Northland Power Inc. · TSX:NPI
Northland Power — Investor Presentation (August 2022)
49 slides from Northland Power's investor presentation, August 2022
Slide 1: Northland Power Investor Presentation August 2022
Northland Power Investor Presentation August 2022
Slide 2: Corporate Overview
CORPORATE OVERVIEW
Slide 3: Northland Overview
Northland NorthlandOverview Overview • A top global player in offshore wind – fastest growing renewables power technology • Northland Power is a leading global power producer at the forefront of the global energy transition • Over 30 years of success developing, constructing and operating power proj
Slide 4: Global Competitive Position
Regional Development Offices Toronto Houston Mexico City Bogota Glasgow Amsterdam Seoul Tokyo Madrid Warsaw Global Competitive Position Offshore Wind Northland is on the ground in key Offshore wind engineering and construction management centers markets Hamburg Taipei Onshore Renewables Onshore wind
Slide 5: Global Company with Local Presence
Global Company with Local Presence Established Regional Presence Provides Competitive Advantage Offshore Wind Strategy Onshore Renewables Strategy New Technologies • TOP 10 Incumbent in Global Offshore Wind • Growth in near-term cash flow • New growth area focus for Northland • Industry is expected
Slide 6: Accelerating Growth
Accelerating Growth Northland’s capital allocation is focused on renewable growth Northland has the following major business segments Offshore Wind Onshore Renewables Utilities Efficient Natural Gas New Technologies Increase Exposure Increase Exposure Increase Exposure Reduce Exposure Establish Posi
Slide 7: Sustainability
Sustainability Keep our people healthy & safe by upholding the highest standard of safety and wellbeing of our people, contractors and all other Developing programs and initiatives to stakeholders inspire, train and grow our workforce Further differentiate our workforce by attracting, developing and
Slide 8: 2021 Sustainability Report
2021 Sustainability Report Our ESG Performance Launched our 2021 Sustainability Report and ESG Performance Index. Both reports represent an enhanced level of ESG disclosure for Northland’s and contain information and data covering our activities and accomplishments in 2021. Alignment and reporting s
Slide 9: Portfolio Overview
PORTFOLIO OVERVIEW
Slide 10: Diversified Asset Portfolio
Diversified Asset Portfolio Strong operating foundation with a significant growth profile Europe (Offshore Wind): Canada: Operated: 1,184 MW Operated: 1,267 MW Development: 2,758 MW Development : 400 MW United Kingdom/Scotland: Development: 2,340 MW U.S.: Development: 320 MW South Korea: Spain: Deve
Slide 11: Sustainable growth
Offshore wind –88% Technology Sustainable growth Strong Growth Portfolio Across Multiple 14 Onshore wind – 3% Technologies GW Solar – 6% Other – 3% Continue to target Europe and Asia as key markets for offshore wind development Expand onshore footprint in Northeast United States and Colombia as well
Slide 12: TOP 10 Incumbent in Global Offshore Wind
Offshore Wind Strategy Leveraging our global leadership position TOP 10 Incumbent in Global Offshore Wind 1.2 GW in operations and 2.7 GW1 of projects which will achieve financial close within the next 2 years Fastest Growing Renewables Technology 1. Includes Hai Long, Baltic Power and Nordsee Two N
Slide 13: Offshore Wind Strategy: National offshore wind targets by 2035
Offshore Wind Strategy Projects and teams in top global markets for offshore wind National offshore wind targets by 2035 Australia: 2GW Brazil: 3GW France: 11GW Germany: 40GW Ireland: 6GW India: 8GW Japan: 10GW Netherlands: 22GW Poland: 11GW Spain: 2GW S. Korea: 12GW Taiwan: 21GW UK: 50GW US: 40GW V
Slide 14: Europe 1.2 GW
Europe Established offshore wind platform in North Sea 1 Deutsche Bucht COD: 2020 Capacity: 252 MW Ownership: 100% PPA Expiry: 2032 1 Deutsche Bucht Nordsee One 2 Gemini 1.2 GW 3 1 Offshore wind in-operation Netherlands 3 Nordsee One Gemini Germany COD: 2017 COD: 2017 2 Capacity: 332 MW Capacity: 60
Slide 15: Baltic Power
Baltic Power Established position in Eastern Europe through Baltic Power offshore wind project Up to 1.2 GW Baltic Power • Poland is an attractive new country within the EU, with growth potential in onshore and offshore • Granted a 25-year fixed price Contract for Differences (“CfD”) • Partnership p
Slide 16: Nordsee Cluster Offshore Wind
Nordsee Cluster Offshore Wind Building Scale and Size in German Offshore Wind Nordsee Delta Nordsee Two 480 MW 433 MW 1.5 GW Godewind 255 MW Nordsee Three Nordsee One 420 MW • Partnership provides scale resulting in enhanced returns due to synergies in development, construction and operation of the
Slide 17: Scotwind Offshore Wind
Scotwind Offshore Wind Executing on our strategy to Extend our Offshore wind runway 2.3 GW N3 N N1 2 • Successfully awarded two leases in recent Crown Estate Scotland offshore wind process • Lease N4 – 840 MW fixed bottom foundation • Lease N2 – 1,500 MW floating foundation • Continuation of Northla
Slide 18: Asia 4.0 GW+
Asia Hai Long project anchor for growth across the region Japan South Korea 4.0 GW+1 Taiwan Offshore wind in-development Taiwan Hai Long 1, 044 MW Japan South Korea Early Stage Development Chiba Katagami Dado Ocean Bobae 600 MW up to 400 MW Up to 1,000 MW 600 MW Mid/Advanced Stage Development 1. Rep
Slide 19: Hai Long
Hai Long Progressing to financial close 1.0GW • Hai Long comprises two adjacent sites: 532 MW Hai Long 2 and 512 MW Hai Long 3 • Localization plan obtained in 2021 HL HL 3 2 • Tendering for main components concluded, preferred supplier agreements signed • EIA amendment approved, allowing for 14MW tu
Slide 20: Asia Offshore Wind Development: Japan
Asia Offshore Wind Development Advancing milestones to facilitate growth and opportunities for future offshore wind Announced entry into Japanese market in 2019 with Chiba project and followed up with membership in consortium to develop Katagami project in 2021. Isumi City, Chiba Prefecture • Develo
Slide 21: Asia Offshore Wind Development: South Korea
Asia Offshore Wind Development Advancing milestones to facilitate growth and opportunities for future offshore wind Acquired Dado Offshore Wind Corp. in February 2020 Multiple early-stage development opportunities near Chodo Island Dado • A 1GW+ mid-stage offshore wind project in-development South K
Slide 22: Onshore Renewables
Onshore Renewables Our onshore renewables strategy Onshore renewables present an attractive growth opportunity for Northland • The industry is expected to grow at upwards of 10% per annum over the next decade. • We continue to build local capabilities in development to ensure that sufficient resourc
Slide 23: Onshore Renewables Strategy
Spain • 57 GW market growth by 2030 • Northland is top ten operator • Focus on development and M&A to grow platform Onshore Renewables EU Eastern Europe • 22 GW market growth by 2030 • Capitalise on Northland “brand” created by Strategy Baltic Power • Focus on development Targeted Approach North Eas
Slide 24: Spain Onshore Renewables
Spain Onshore Renewables Achieving Success in Onshore M&A Execution on M&A strategy to secure near-term cash flow and establish new market • Acquired a portfolio of 551 MW (net) of onshore renewables with a regulated tariff • Delivers near-term cash flow which helps fund the development of Northland
Slide 25: United States
United States New York onshore wind Ball Hill 320 MW 108 MW Bluestone 112 MW • Acquired three New York onshore wind development projects in 2020. Projects Highbridge 100 MW expand Northland’s North American portfolio by providing investment opportunities into the US renewables market • Well position
Slide 26: Colombia Onshore Renewables: Helios
Colombia Onshore Renewables Helios Solar Project Overview 16 MW EBSA • 16 MW Solar project in Colombia Helios • First development project in Colombia to capitalize on EBSA’s grandfathered rights, allowing it to expand into the energy generation market in Colombia • Aim is to service the power needs
Slide 27: Colombia Onshore Renewables: Suba
Colombia Onshore Renewables Suba Solar Project Overview 130 MW EBSA • Secured two solar projects in Colombian renewables auction with a Suba combined capacity of 130 MW • Developing in partnership with EDF Renewables through 50/50 joint venture • Projects underpinned by 15-year Power Purchase Agreem
Slide 28: Utilities
Utilities High-quality Regulated Utility Business Regulated utility provides strategic value to existing asset portfolio • Sole distributor to a population of over 1.3 million; proven management team with local expertise • Operates under regulatory framework with an average approved WACC of approxim
Slide 29: Colombia: EBSA Utility
Colombia EBSA Utility • Provided Northland with a platform to drive future opportunities in Colombia and Latin America EBSA • EBSA is one of a few energy companies in Colombia with favourable grandfathered rights allowing for vertical integration across all segments of the electricity market • In ad
Slide 30: Financial Overview
FINANCIAL OVERVIEW
Slide 31: Long-term financial objectives
BBB (Stable) Long-term financial Maintain investment grade balance sheet to support growth objectives $12-15B1 pipeline Maintain flexibility to fund Capitalized Projects costs Maintaining flexibility, adding corporate funding tools to diversify sources of capital, preserving low cost of capital and
Slide 32: Committed to prudent capital structure and investment grade
Commitment to investment grade credit rating and continued balance sheet strength Committed to prudent Corporate Credit Ratings capital structure and S&P Fitch BBB (Stable) BBB Stable investment grade (since 2013) (since fall 2021) rating • Strong financial condition supported by investment grade ra
Slide 33: Financial Strategy
Financial Strategy Disciplined and flexible approach to project funding • The Company manages its capital strategy with a high degree of selectivity in funding its capitalized growth projects • Focused on maintaining an investment grade rating • Credit facilities support short-term funding needs wit
Slide 34: Strong Balance Sheet will Support Growth
Strong Balance Sheet will Support Growth Illustrative Capital Funding Plan of Capitalized Growth projects Over Next Five Years Illustrative Funding Plan ~$1-2Bn ~$1Bn NORTHLAND EQUITY2 + for Capitalized Projects GREEN CORPORATE DEBT (INCLUDING OFFSHORE WIND SELL-DOWNS REVOLVER/HYBRIDS) ~10-15% (2022
Slide 35: Sustainable Finance
Sustainable Finance Adding Financial Optionality to Portfolio Green Financing allows Northland to diversify and optimize additional sources of capital to fund growth plan Green Financings $1Bn+ Credit Facility with Green Bonds Targeting all of our project finance debt sustainability linked KPIs to b
Slide 36: 2022 Financial Guidance
2022 Financial Guidance Adjusted EBITDA and Free Cash Flow Adjusted EBITDA Utilities– 8% $1.25 to $1.35 Offshore wind – 52% Billion Efficient natural gas– 16% 2022E Free Cash Flow (incl. growth expenditures) Adjusted EBITDA $1.40 to $1.60 Onshore renewables– 24% Per Share Adjusted Free Cash Flow (ex
Slide 37: Strong annual EBITDA growth
Strong annual EBITDA growth Capitalized Growth Projects will increase EBITDA and Quality of Cash Flow through 2027+ + Ability for more $2.0 – 2.2 Bn 2 growth through 6 GW Additional Pipeline $1.7 – 1.9 Bn 1 EBITDA $1.15 - 1.25 Bn ~ 2x 7-10% Capitalized By 2030 CAGR + Other Capitalized Identified pro
Slide 38: Northland's Competitive Positioning
Northland’s Competitive Positioning Northland is well positioned to capitalize on market growth opportunities Growth Pipeline Moves Toward Financial Close Global De-carbonization movement is accelerating Significant growth in renewables expected to offer immense opportunities for Northland 2.9 GW of
Slide 39: Looking Forward
Looking Forward Northland’s identified development projects to deliver substantial growth Total Pipeline 14 Identified Devt GW Projects3 9.0+ Capitalized Devt GW Projects2 Capacity 6.5 Existing Projects GW >2x 3.2 By 2030 GW1 9% CAGR 2021 2027e 2030e 2021 2027 1. Based on installed gross capacity an
Slide 40: Appendix
APPENDIX
Slide 41: Shareholder Returns
Shareholder Returns Track Record of Strong Returns to Shareholders An investor who invested in the IPO in 1987 would have realized a total return of over 2,200 %1 Annual Dividends (Distributions) per share Total Shareholder Returns Peer Group $1.20 S&P/TSX Capped Utilities Index Northland Power $0.8
Slide 42: Market Summary
Market Summary Key Metrics1 Recent Share Price (TSX: NPI) $45.71 Shares (Common) 235 million Annual Dividend $1.20 2022 EBITDA Guidance $1.25 – $1.35 billion 2021 FCF/sh Guidance $1.40 – $1.60 2021 Adjusted FCF/sh Guidance $1.85 - $2.05 Total Debt, Net of Cash2 $6.0 billion Preferred Shares (NPI.PR.
Slide 43: European Offshore Wind
European Offshore Wind Facility Details Gemini Nordsee One Deutsche Bucht Capacity 600 MW 332 MW 252 MW Distance to Shore 85km 40km 95km Wind Turbines 150 x Siemens 4 MW 54 Senvion x 6.15 MW 31 x MHI Vestas 8MW Turbine Foundation Monopile Monopile Monopile Water Depth 28m to 36m 26m to 29m 39m to 41
Slide 44: Northland's Operating Assets
Northland’s Operating Assets On-time and on-schedule project execution Construction Expiry PPA (On-time/on- Project Technology Location Gross Capacity Ownership Term budget) Gemini Offshore Wind Netherlands 600 MW 60% 2032 ✓ Nordsee One Offshore Wind Germany 332 MW 85% 2027 ✓ Deutsche Bucht Offshore
Slide 45: Project Pipeline
Project Pipeline Nearly 8 GW of capitalized and identified projects to support growth to 2030 Northland Current Project Location Technology Size Status Contract Type Est. COD Ownership Capitalized Growth Projects Hai Long Taiwan Offshore Wind 1,044MW 60% Late-Stage Development 20-yr PPA 2026/2027 Ba
Slide 46: Onshore Renewables
Onshore Renewables Our onshore business continues to grow to supplement growth in offshore wind Project Technology Size Status COD Our onshore strategy will Spain Solar and wind 551MW Operational provide nearly 1.2 GW of La Lucha Solar 130MW Construction 2022 near-term growth to complement growth fr
Slide 47: Forward looking statement
Forward looking statement This written and accompanying oral presentation contains certain forward-looking statements which are provided for the purpose of presenting information about management’s current expectations and plans. Readers are cautioned that such statements may not be appropriate for
Slide 48: Reporting of Non-IFRS Financial Measures
Reporting of Non-IFRS Financial Measures This investor presentation includes references to Northland’s adjusted EBITDA and free cash flow, measures not prescribed by International Financial Reporting Standards (IFRS). Adjusted EBITDA and free cash flow, as presented, may not be comparable to other s
Slide 49: Northland Power investor relations contact
Northland Power Wassem Khalil Email: investorrelations@northlandpower.com 30 St. Clair Avenue West, Senior Director Investor Relations & Strategy 12th Floor 647.288.1019 Website: northlandpower.com Toronto, ON Canada M4V 3A1
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