Greencoat UK Wind Plc · LSE:UKW
Greencoat UK Wind — FY2017 Earnings Presentation
30 slides from Greencoat UK Wind's earnings presentation, February 2018
Slide 1: Annual Results
Annual Results February 2018
Slide 2: Simple Low Risk Proven
▪ Greencoat UK Wind acquires and operates UK wind farms. The cash generated by these assets is used primarily to pay a robust, premium dividend to shareholders. The remainder is reinvested to Simple ensure capital is preserved in real terms. ▪ Simple structure, UK domiciled with a strong board, wind
Slide 3: 2017 Highlights
2017 Highlights ▪ Power generation of 1,457GWh; in line with budget ▪ Net cash generation of £80.1m (2016: £49.0m) ▪ Dividends of £57.3m (6.49p per share) declared with respect to the year and 6.76p target for 2018 ▪ Eleven investments made taking generating capacity to 694MW ▪ GAV increased from £9
Slide 4: Simple Model
Simple Model 6-29 wind Generating capacity increased farms from 127 to 694MW since IPO Total reinvestment Equity 4.1TWh Total power produced Debt £231.4m Total cash generated £66.7m £164.7m Total dividends paid or declared “6p dividend, increasing with RPI inflation and real NAV preservation’’ 4 Not
Slide 5: Track Record of Consistent Delivery
Track Record of Consistent Delivery Period Production Cash Generation Dividend(1) Dividend Cover(2) RPI NAV Growth 2013(3) 291.5GWh £21.6m £14.2m (4.50p) 1.8x 1.9% 2.5% 2014 564.6GWh £32.4m £24.8m (6.16p) 1.6x 1.6% 2.5% 2015 799.3GWh £48.3m £29.6m (6.26p) 1.7x 1.2% 0.5% 2016 978.1GWh £49.0m £38.8m (
Slide 6: Wind Resource and Production
0 1 2 3 4 5 6 7 January February March April May June July Production + 8% Wind Speed + 3% August 2013(2) September October Annual average November December January February March April May June July 2014 - 3% - 2% August September October November 10 year average December January Wind Resource and
Slide 7: Operational and Financial Performance
Operational and Financial Performance
Slide 8: Operational Performance
Operational Performance Portfolio availability in line with budget Notable issues: ▪ Little Cheyne – gearbox, converter and blade bolt issues ▪ Corriegarth – post commissioning issues exacerbated by restricted access in Nov and Dec due to heavy snow ▪ Lindhurst - replacement of several transformers
Slide 9: Financial Performance
For the year ended 31 December 2017 Group and wind farm SPV cash flows £000 Net cash generation 80,069 Dividends paid (52,300) Acquisitions” (502,179) Acquisition costs (2,672) Equity issuance 340,000 Equity issuance costs (4,912) Net drawdown under debt facilities 165,000 Upfront finance costs (2,0
Slide 10: Financial Performance
For the year ended 31 December 2017 Net Cash Generation — Breakdown £'000 Revenue 126,361 Operating expenses (33,619) Tax (1,573) Other 1,983 Wind farm cashflow 93,152 Management fee (8,062) Operating expenses (983) Ongoing finance costs (6,571) Other 1,394 Group cashflow (14,222) VAT (Group and win
Slide 11: Net Asset Value
Investment Performance Opening NAV Movement in Movement in Closing NAV 31 December DCF other relevant 31 December 2016 valuation assets/liabilities 2017 £800.1r £507.4 £17.4n £21.0; £2 £16 £1,144.0; — —— —_ fm 1,028,514,652 ] ( Shares in issue 736,700,850 ( NAV/share (pence) 108.6 111.2 } 11
Slide 12: Net Asset Value Since IPO
Net Asset Value Since IPO UKW NAV growth of 11.8% v RPI growth of 11.8% since IPO 12 Note: (1) adjusted for accrued dividends
Slide 13: Investment Performance
Investment Performance TSR in 2017 of 8.4% TSR since IPO of 58.3% Strong, consistent return with correlation to inflation 13
Slide 14: Portfolio and Acquisitions
Portfolio and Acquisitions
Slide 15: Portfolio Overview
Portfolio Overview Well-diversified portfolio generating sufficient electricity to power 620,000 homes 15 Note: all assets shown by value as at 31 December 2017
Slide 16: Acquisitions in 2017
Acquisitions in 2017 Month of Net Investment Wind Farm Seller Comment Acquisition MW Langhope Rig March GE 16.0 £39.9m Bilateral Bishopthorpe June BayWa 16.4 £47.8m Repeat North Hoyle August JP Morgan AM 60.0 £68.2m JPM AM’s only offshore asset Slieve Divena August JP Morgan SM 30.0 £36.6m JPM AM’s
Slide 17: Clyde Extension
Clyde Extension Overview Location Previous Ownership ▪ SSE Capacity ▪ 173MW Turbines ▪ 54 x Siemens 3.2MW Commercial Operations Date ▪ Aug 2017 PPA ▪ SSE until 2032 Turbine O&M ▪ Siemens O&M Management ▪ SSE ▪ Clyde Extension construction indemnity fell away upon commissioning on 28 August 2017 ▪ UK
Slide 18: Corriegarth
Corriegarth Overview Location Previous Ownership ▪ Invenergy Capacity ▪ 69.5MW Turbines ▪ 23 x Enercon 3.02MW Commercial Operations Date ▪ Apr 2017 PPA ▪ Centrica to 2032 Turbine O&M ▪ Enercon O&M Management ▪ Wind Prospect ▪ Corriegarth is UKW’s second transmission-connected wind farm investment ▪
Slide 19: EDF English Portfolio
EDF English Portfolio Red House Bicker Fen 12.3MW 26.7MW 6 turbines 13 turbines Lincolnshire Glass Moor 16.4MW 8 turbines Deeping St Nicholas 16.4MW 8 turbines Cambridgeshire Red Tile 24.6MW 12 turbines ▪ UKW bought 80% from EDF Energy Renewables ▪ All Senvion MM82 2.05MW turbines ▪ EDF operates all
Slide 20: Secondary Market - Continued Opportunities to Grow
Secondary Market - Continued Opportunities to Grow UKW net generating capacity (MW) 700 694MW 600 500 400 300 200 127MW 100 0 30,000 25,000 £45bn market 20,000 15,000 £20bn market 10,000 UK offshore capacity (MW) 5,000 UK onshore capacity (MW) 0 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-2
Slide 21: Summary
Summary
Slide 22: 2017 Highlights
2017 Highlights ▪ Power generation of 1,457GWh; in line with budget ▪ Net cash generation of £80.1m (2016: £49.0m) ▪ Dividends of £57.3m (6.49p per share) declared with respect to the year and 6.76p target for 2018 ▪ Eleven investments made taking generating capacity to 694MW ▪ GAV increased from £9
Slide 23: Appendix
Appendix
Slide 24: Diversified Asset Portfolio (1)
Diversified Asset Portfolio (1) Group Acquisition Total Commercial ROCs / Forecast Net Load Wind Farm Country Turbines PPA Ownership Net MW(1) MW Operations Date Date MWh Factor(2) Stake Bicker Fen England Senvion EDF 26.7 80% 21.3 Sep-08 Nov-17 1.0 23.6% Bin Mountain N Ireland GE SSE 9.0 100% 9.0 J
Slide 25: Diversified Asset Portfolio (2)
Diversified Asset Portfolio (2) Group Acquisition Total Commercial ROCs / Forecast Net Load Wind Farm Country Turbines PPA Ownership Net MW(1) MW Operations Date Date MWh Factor(2) Stake Earl’s Hall Farm England Senvion Sainsbury’s 10.3 100% 10.3 Mar-13 Oct-13 1.0 36.1% Glass Moor England Senvion ED
Slide 26: Diversified Asset Portfolio (3)
Diversified Asset Portfolio (3) Group Acquisition Total Commercial ROCs / Forecast Net Load Wind Farm Country Turbines PPA Ownership Net MW(1) MW Operations Date Date MWh Factor(2) Stake Red House England Senvion EDF 12.3 80% 9.8 Jun-06 Nov-17 1.0 25.8% Red Tile England Senvion EDF 24.6 80% 19.7 Apr
Slide 27: Langhope Rig, Bishopthorpe, North Hoyle, Slieve Divena
Langhope Rig, Bishopthorpe, North Hoyle, Slieve Divena Slieve Divena – 30MW (100%) Langhope Rig – 16MW (100%) ▪ Same Nordex 2.5MW turbines ▪ Similar GE turbines to Bin and technicians as Screggagh Mountain and Tappaghan (20 miles away) ▪ GE recycling capital after ▪ JP Morgan AM selling its only tur
Slide 28: Simple Capital Structure
Simple Capital Structure Asset Level ▪ No debt at asset level in existing portfolio nor intention to have any asset level debt going forward ▪ Revolving Credit Facility (“RCF”) used to acquire new assets Fund Level ▪ Significant value opportunity for the fund: execution advantage without the carry c
Slide 29: NAV Sensitivities
NAV Sensitivities The base case portfolio discount rate is 7.7% (unlevered). A variance of +/- 0.5 per cent. is considered to be a reasonable range of alternative assumptions for discount rate. Base case energy yield assumptions are P50 (50 per cent. probability of exceedance) forecasts produced by
Slide 30: Disclaimer
Disclaimer Important Information This document has been prepared by Greencoat Capital LLP and Greencoat UK Wind PLC (“UKW”) solely for use at a presentation in connection with UKW’s annual results in respect of the period from 31 December 2017 to 31 December 2018 (the “Presentation”). For the purpos