Suzlon Energy Ltd · NSE:SUZLON
Suzlon Energy — Q3 FY2011 Earnings Presentation
37 slides from Suzlon Energy's earnings presentation, Feb 4, 2011
Slide 1: Q3 FY 2010-11 Earnings Presentation
S l Energy Suzlon E Limited Li it d Q3 FY 2010‐11 Earnings Presentation 4th February 2011 Suzlon windfarm at Dhule, India 1 www.suzlon.com
Slide 2: Disclaimer
Disclaimer • This presentation and the accompanying slides (the “Presentation”), which have been prepared by Suzlon Energy Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securi
Slide 3: Contents
Contents • Suzlon Group: Key highlights – Q3 FY2011 – Volumes continue to grow sequentially and YoY – Strong order book, improving visibility for FY2012 – Robust turbine fleet performance across the globe • Outlook for the FY2012 and beyond – Green shoots visible in the wind industry – Developed p a
Slide 4: Suzlon Group - Key highlights: Q3 FY2011
Contents Suzlon Group ‐ Key highlights : Q3 FY2011 • Suzlon Group: Key highlights – Q3 FY2011 – Volumes continue to grow sequentially and YoY – Strong order book, improving visibility for FY2012 – Robust turbine fleet performance across the globe • Outlook for the FY2012 and beyond – Green shoots vi
Slide 5: Financial performance snapshot
Financial performance snapshot INR Crs. Q3 Q3 9m 9m FY2009‐10 Particulars FY2010‐11 FY2009‐10 FY2010‐11 FY2009‐10 Unaudited Unaudited Unaudited Unaudited Audited (a) MW Volume (Suzlon Wind) 461 404 1,029 810 1,460 Suzlon Wind Business revenue 2,509 2,453 6,138 5,485 9,635 REpower revenue 1,903 2,454
Slide 6: Group order book
Group order book Firm group order book Announced framework contracts Suzlon Wind • 300 MW business agreement with Techno Electric • Order book as on 4th Feb, 2011 is • 225 MW framework agreement with EUFER 2,578 MW : Rs. 14,635 Crs. (JV between ENEL Green Energy and Union Fenosa) (~$3bn*) for Spain
Slide 7: Orders announced since last results
Orders announced since last results Asia – 1,150 MW • 150 MW order in India from Vedanta Group - Deal valued at ~$ 191mn - 50 MW delivery by March 2011 and 100 MW by September 2011 • 1,000 MW order in India with Caparo Group - Deal valued at ~$ 1.28 bn - 500 MW to be commissioned by March 2012 and b
Slide 8: Orders announced since last results
Orders announced since last results North America – 351 MW • 51 MW order in US from EverPower - Also has a further option for 85 units - Order to be commissioned by end of 2011 • 300 MW order in Canada with Saint‐Laurent Énergies Consortium - Order confirmed out of a framework contract of 954 MW - C
Slide 9: Robust turbine fleet performance
Robust turbine fleet performance Improving global fleet availability*... ...is the result of a globally coordinated execution effort Total installations across the Globe over 10 GW OMS teams across Suzlon have worked on a program focussed on increasing availability Global average fleet availabilityy
Slide 10: Outlook for the FY2012 and beyond
Robust turbine fleet performance Outlook for the FY2012 and beyond Improving global fleet availability*... ...is the result of a globally coordinated execution effort Total installations across the Globe over 10 GW OMS teams across Suzlon have worked on a program focussed on increasing availability
Slide 11: Industry outlook: green shoots visible
Industry outlook: green shoots visible Improving wind financing for new build Developing trends wind assets ($bn) 26 • Globally, prospects for 20 19 18 12 wind assets improving 16 8 10 China • Project financing 7 9 Europe 2 5 growing with each 7 3 3 North America 2 5 4 quarter t 3 RoW 2 5 4 3 3 2 •
Slide 12: Developed markets: slow recovery visible
Developed markets : slow recovery visible North America Europe (Decent growth expected in 2011) (Stable, but more saturated and hence growing slowly) USA: Onshore: • ~5.1 GW installed in 2010 v/s 10 • Certain regions remain challenging – credit GW installations in 2009, a drop spreads in Spain, Gree
Slide 13: Emerging markets: leading revival
Emerging markets : leading revival Asia Rest of the World (Growth continues with strong policy push) (Positive developments continue) China: Brazil: • 12th five year plan set to spell out the • Regulatory push for wind continues improved framework in terms of underpinned by need for diversification
Slide 14: Offshore: growing at a fast clip
Offshore : growing at a fast clip Offshore wind energy in 2010 • Global installations in 2010: - 833 MW, (+51% compared to 2009) • TOP 4 countries (new installations 2010): - UK (52%), Denmark (23%), Belgium (19%), Germany (6%) • Cumulative global offshore installations (as per Dec 31, 2010): - 2,94
Slide 15: India: New emerging revenue models
India: New emerging revenue models create lucrative opportunities Broadly, three revenue models have emerged in India with a lucrative risk/return profile Revenue models 1 2 3 Preferential tariff model REC model Captive model • Ensures fixed pre‐tax RoE of • Revenue stream = electricity • Preferred
Slide 16: India: Business continues to gather momentum
India: Business continues to gather momentum Strong order inflows..... ...resulting in robust order book (Figures in MW) (Figures in MW) 2 147 2,147 1,624 +279% +417% 566 314 9m FY10 9m FY11 Q3 FY10 Q3 FY11 • Booked approx. 1,255 MW of orders since last order book update • Indian market is expected
Slide 17: Brazil: Continues to provide positive momentum
Brazil: Continues to provide positive momentum Favorable industry dynamics • Suzlon announced an order 218 MW from Martifer with commissioning scheduled before June 2012 • The market is expected to grow from ~700 MW to 6GW of cumulative installations by 2019 ‐ Currently, half of the installations in
Slide 18: Offshore: Provides significant visibility for future
Offshore: Provides significant visibility for future Beatrice Thornton Alpha Ormonde Nordsee Thornton Bank Ventus Ost Bank Phase I Phase II & III 2 x 5M 6 x 5M 6 x 5M 30 x 5M 48 x 6M 48 x 6M (10 MW) (30 MW) (30 MW) (150 MW) (295 MW) (295 MW) 18 www.suzlon.com
Slide 19: New products: well received by customers
New products: well received by customers • Low wind speed (IEC Class‐III) sites presents significant opportunity • New offerings from Suzlon Group are designed with larger rotor diameters, increased hub heights, improved aerodynamic efficiency, and grid‐friendly characteristics for delivering higher
Slide 20: Suzlon Group has all the relevant competencies
Suzlon Group has all the relevant competencies Suzlon strengths REpower strengths Group Positioning • Asia, US, ANZ, Brazil • Global player Market coverage • Europe, US, Canada • Developing markets • Present across geographies, with • Customer • Developed markets • Strong customer centric flexible b
Slide 21: Group well positioned in current market environment
Group well positioned in current market environment • India: A high margin market, capitalizing on the robust growth 1 Emerging markets • Entrenched in China, Brazil • Early entrant in South Africa, Chile, Argentina and Mexico Offshore & key • Well entrenched with a comprehensive product portfolio f
Slide 22: Chairman's Message
Chairman’s Message Mr. Tulsi Tanti, Chairman and Managing Director – Suzlon Group, said: “I am pleased to report that our Group performance is steadily improving. Emerging, offshore and key matured markets are showing sustained momentum. momentum Our strategy to focus on these markets is delivering
Slide 23: Detailed financials - Q3 FY2011
Chairman’s Message Mr. Tulsi Tanti, Chairman and Managing Director – Suzlon Group, said: “I am pleased to Detailed financials – report that our Group performance is steadily improving. Emerging, offshore and key Q3 FY2011 matured markets are showing sustained momentum. momentum Our strategy to focus
Slide 24: Consolidated financial results
Consolidated financial results (Suzlon Wind + SE Forge + Hansen + REpower*) INR Cr. Q3 FY11 Q3 FY10 9m FY11 9m FY10 Particulars Unaudited Unaudited Unaudited Unaudited(a) Sales 4,433 5,590 10,603 14,536 Raw material cost 3 031 3,031 3 674 3,674 7 344 7,344 9 806 9,806 Gross Profit 1,402 1,916 3,259
Slide 25: Consolidated financial results: Q3 year-on-year
Consolidated financial results Q3‐year‐on‐year Q3 FY11 (unaudited) (INR Cr.) Q3 FY10 (unaudited) (INR Cr.) Particulars Suzlon SE Forge Hansen REpower Consol. Suzlon SE Forge Hansen REpower Consol. Sales MW 461 404 Sales 2,509 91 ‐‐ 1,903 4,433 2,453 28 699 2,454 5,590 Raw material cost 1,605 57 ‐‐ 1
Slide 26: Consolidated financial results excluding FX impact
Consolidated financial results: Excluding impact of foreign exchange loss / (gain) INR Cr. Suzlon Wind Consolidated – Ex Hansen Particulars Q3 FY11 Q3 FY10 Q3 FY11 Q3 FY10 Sales 2,509 2,453 4,433 4,891 Raw material cost 1,605 1,647 2,922 3,291 Gross Profit fi 905 807 1,511 1,600 Gross Profit margin
Slide 27: Consolidated financial results: 9m year-on-year
Consolidated financial results 9m‐year‐on‐year 9m FY11 (unaudited) (INR Cr.) 9m FY10 (unaudited) (INR Cr.) Particulars Suzlon SE Forge Hansen REpower Consol. Suzlon SE Forge Hansen REpower Consol. Sales MW 1,029 810 Sales 6,138 240 ‐‐ 4,411 10,603 5,485 55 2,656 6,579 14,536 Raw material cost 4,108
Slide 28: Consolidated financial results: FY10 vs FY09
Consolidated financial results year‐on‐year FY10 (unaudited) (a) (INR Cr.) FY09 (unaudited) (b) (INR Cr.) Particulars Suzlon SE Forge Hansen REpower Consol. Suzlon SE Forge Hansen REpower Consol. Sales MW 1,460 2,790 Sales 9,635 104 2,656 8,502 20,620 15,897 17 3,994 7,125 26,082 Raw material cost 6
Slide 29: Suzlon group order book
Suzlon group order book Orders as on New Sales in Orders as on Region Sales in FY10 Sales in FY09 Sales in FY08 29/10/10 Orders Q3 FY11 04/02/11 India 693 1,255 , 325 1,624 , 688 749 975 USA 246 ‐‐ ‐‐ 246 410 989 593 China 397 ‐‐ 73 324 182 249 134 ANZ 53 8 57 4 128 430 143 Europe 162 ‐‐ ‐‐ 162 53 1
Slide 30: Consolidated: NWC improving
Consolidated: NWC improving INR Cr. Particulars As on As on As on As on As on 31st Dec. ’10 30th Sept. ’10 30th Jun ’10 31st Mar ‘10 31st Dec. ’09 Inventories 6 907 6,907 6 321 6,321 5 890 5,890 5 994 5,994 5 796 5,796 Receivables 5,010 4,283 4,428 6,192 5,524 Advances * 1,915 2,268 1,771 1,684 1,88
Slide 31: Suzlon Wind: NOWC stabilized
Suzlon Wind: NOWC stabilized • Suzlon Wind Business: ‐ In view of traditionally higher volumes in Q4, NOWC is stable on y‐o‐y basis INR Cr. Particulars As on As on As on As on As on 31st Dec. ’10 30th Sept. ’10 30th Jun ’10 31st Mar ‘10 31st Dec. ’09 Inventories 3 241 3,241 3 013 3,013 2 910 2,910 2
Slide 32: Suzlon Wind: WTG revenue by geography
Suzlon Wind: WTG revenue by geography Region 9m FY11 Sales FY10 Sales FY09 Sales FY08 Sales (MW) (INR Crs.) (MW) (INR Crs.) (MW) (INR Crs.) (MW) (INR Crs.) India 754 4,110 688 4,094 749 4,420 976 5,572 USA 27 435 410 2,483 989 5,229 593 2,289 China 181 701 182 813 249 1,104 134 455 ANZ 57 735 128 1,
Slide 33: Group Financial Leverage
Group Financial Leverage As at As at As at As at As at 31st Dec. 2010 30th Sept. 2010 30th June 2010 31st March 2010 31st Dec. 2009 Particulars SEL Consol. SEL Consol. SEL Consol. SEL Consol. SEL Consol. Wind Group Wind Group Wind Group Wind Group Wind Group (a) (a) (a) (a) (a) (a) (a) (a) (a) (a) G
Slide 34: Suzlon Wind: Financial leverage
Suzlon Wind: Financial leverage (a) INR Cr. Debt type Balance as on Balance as on Balance as on Balance as on Balance as on 31st Dec. 2010 30th Sept. 2010 30th June 2010 31st March 2010 31st Dec. 2009 Acquisition loans 2 073 2,073 2 085 2,085 2 155 2,155 2 083 2,083 2 159 2,159 FCCBs 2,141 2,153 2,2
Slide 35: FCCBs: Post restructuring
FCCBs: Post restructuring Key Terms: Outstanding amount Conversion Redemption FCCBs Maturity date Coupon rate (USD mln) price (Rs.) Premium June 2012 ‐ Old 211.3 97.26 June 2012 0% 145.23% October 2012 ‐ Old 121.4 97.26 October 2012 0% 144.88% June 2012 ‐ Exchange 35.6 76.68 June 2012 7.5% 150.24% O
Slide 36: REpower Net Profit Reconciliation
REpower Net Profit Reconciliation Q3 FY 2011 9m FY 2011 Particulars EURO m INR Crs. EURO m INR Crs. Profit / (loss) as per REpower books 4 32 26 158 Less: Policy alignment impact (6) (36) (2) (12) Profit / (loss) before translation loss 10 68 28 171 Less: FX loss on translation of COGS 18 109 55 332
Slide 37: Thank You
REpower Net Profit Reconciliation Q3 FY 2011 9m FY 2011 Particulars EURO m INR Crs. EURO m INR Crs. Profit / (loss) as per REpower books 4 32 26 158 Less: Policy alignment impact (6) (36) (2) (12) Profit / (loss) before translation loss 10 68 28 171 Less: FX loss on translation of COGS Profit / (los