NextEnergy Solar Fund Ltd · LSE:NESF
NextEnergy Solar Fund — H1 FY2018/19 Earnings Presentation
29 slides from NextEnergy Solar Fund's earnings presentation, Nov 20, 2018
Slide 1: NextEnergy Solar Fund Limited Results for the period ended 30 September 2018
NextEnergy Solar Fund Limited Results for the period ended 30 September 2018 Analyst Presentation – 20 November 2018
Slide 2: Agenda – Presented by NextEnergy Capital, Investment Adviser
Interim Results for the period ended 30 September 2018 Agenda – Presented by NextEnergy Capital, Investment Adviser MICHAEL BONTE-FRIEDHEIM NEC Founding Partner & CEO • Investment Update – Michael Bonte-Friedheim ALDO BEOLCHINI NEC Managing Partner & CFO • Financial Results – Aldo Beolchini • Q&A -
Slide 3: Investment Update
Investment Investment Update Update
Slide 4: Investment Highlights
Interim Results for the period ended 30 September 2018 Investment Highlights 30 September 2018 ◼ Investment portfolio of 87 solar PV assets amounting to 691MWp installed capacity NAV – £610m NAV/share – 105.1p ◼ Acquired 24 new UK solar assets during the last six months including first investmen
Slide 5: Continuous Operating Outperformance
Interim Results for the period ended 30 September 2018 Continuous Operating Outperformance ◼ NESF’s portfolio consistently generates more electricity than its acquisition budget estimates (+4.2% since IPO) ◼ This portfolio outperformance is only partially due to higher solar irradiation than forecas
Slide 6: Portfolio Assets
Interim Results for the period ended 30 September 2018 Portfolio Assets ◼ NESF’s 87 PV assets represent 691MWp of installed capacity and £894m of investment value ◼ NESF acquired project rights for subsidy free projects representing 172MWp Project rights: 6
Slide 7: Current UK Pipeline
Interim Results for the period ended 30 September 2018 Current UK Pipeline ◼ NEC is negotiating Tier 1: Letters of Intent multiple UK projects for NESF Power plants location Incentive regime Plant capacity Status ◼ Advanced negotiation pipeline amounts to Multiple sites No Subsidies 470MWp Planning
Slide 8: UK Energy Market Prices
Interim Results for the period ended 30 September 2018 UK Energy Market Prices ◼ Current long-term power Forecast UK Power Price (Real 2018 - £/MWh) (1) price forecast implies an average growth rate of c.0.2% in real terms between 2018 and 2038 ◼ As at September 2018, c.68% of NESF revenues are cont
Slide 9: Portfolio's Secured Power Prices
Interim Results for the period ended 30 September 2018 Portfolio’s Secured Power Prices Apollo - ROC Assets (226 MWp) Radius and NIBC assets (112 MWp) ◼ NEC continues to Output Locked Locked Price (£/MWh) Output Locked Locked Price (£/MWh) secure higher power Winter 2018 / 2019 100.0% 52.5 100.0% 52
Slide 10: Strategic Focus 2018/19
Interim Results for the period ended 30 September 2018 Strategic Focus 2018/19 ◼ Optimisation of revenues and reduction of operating expenses of current portfolio of assets ◼ On-boarding and integration of acquired portfolios ◼ Construction of subsidy free assets in the UK ◼ Opportunistic acquisitio
Slide 11: Financial Results
Financial Results
Slide 12: Financial Highlights
Interim Results for the period ended 30 September 2018 Financial Highlights ◼ Net Asset Value grew from £605.0m to £609.8m. NAV per share stable at 105.1p ◼ First Issuance of Preference Shares for £100.0m on 13 November 2018 following shareholder approval on 8 November. The second issuance is expect
Slide 13: Issuance of Preference Shares
Interim Results for the period ended 30 September 2018 Issuance of Preference Shares ◼ An issuance of £200m is ◼ On 8 November 2018, the Shareholders approved the creation of £200m of Preference Shares. The expected to increase Company issued the first tranche of £100m and is expecting a subsequent
Slide 14: Track Record Since IPO
Interim Results for the period ended 30 September 2018 Track Record Since IPO 14
Slide 15: Portfolio Valuation
Interim Results for the period ended 30 September 2018 Portfolio Valuation Discount rates ◼ Equity discount rate remains at 6.75% for unlevered assets ◼ Levered discount rates up to 9.00% for levered assets Up to 1.0% premium used to reflect greater risk to shareholders from levered assets/portfol
Slide 16: NAV Movement
Interim Results for the period ended 30 September 2018 NAV Movement 16
Slide 17: Debt Financing Strategy
Interim Results for the period ended 30 September 2018 Debt Financing Strategy ◼ NESF has total debt facilities outstanding of ◼ Fully amortising facility (£149m outstanding) expiring in 2035 £365m which represents with unique NAV-enhancing features (grace period, DSRF, 37% of GAV flexible PPA) ◼ Ad
Slide 18: Robust Dividend Cover
Interim Results for the period ended 30 September 2018 Robust Dividend Cover ◼ During the period the Company generated cash income of £26.3m and had net operating costs of £3.3m ◼ For illustrative purpose only, a theoretical principal instalment on the Apollo financing for the period would have redu
Slide 19: Summary Income Statement
Interim Results for the period ended 30 September 2018 Summary Income Statement 1 April 2016 to 1 April 2018 to 1 April 2017 to 30 September 30 September 2018 31 March 2018 2017 £m £m £m Income 26.3 41.1 16.4 Movement in Investment Portfolio value (4.4) (2.9) 0.5 Net Income 21.9 38.2 16.9 Total expe
Slide 20: Summary Balance Sheet and Cash Flows
Interim Results for the period ended 30 September 2018 Summary Balance Sheet and Cash Flows During the period 30 September 30 September 2018 31 March 2018 Balance Sheet 2017 ◼ NAV increased by £4.8m £m £m £m ◼ Investment Portfolio increased by £110m Investment Portfolio 591.3 481.4 390.4 ◼ Cash at b
Slide 21: Q&A – Appendix
Q&A – Appendix Leading Solar Asset Manager
Slide 22: NESF Overview
Interim Results for the period ended 30 September 2018 NESF Overview NextEnergy Solar Fund ❑ Attractive acquisition values sourced by NextEnergy Capital ❑ Operational outperformance supported by WiseEnergy ensuring optimal asset management ❑ Targeting a quarterly dividends linked to UK RPI (6.65p/sh
Slide 23: Capital Raise and Deployment
Interim Results for the period ended 30 September 2018 Capital Raise and Deployment ◼ During the period NESF has fully deployed all the capital raised through equity raising and debt financing ◼ During the period NESF issued an additional 4.6m new shares totalling £5.0m in the form of scrip dividend
Slide 24: Investment Portfolio Diversification
Interim Results for the period ended 30 September 2018 Investment Portfolio Diversification 24
Slide 25: UK Energy Market
Interim Results for the period ended 30 September 2018 UK Energy Market Power Prices ◼ During the year, the wholesale day ahead power market in the UK experienced an upward movement following the movement in gas price, electricity spot prices rose from £46/MWh in September 2017 to £67/MWh in Septemb
Slide 26: NAV Sensitivities
Interim Results for the period ended 30 September 2018 NAV Sensitivities ◼ The long-term sensitivity analysis highlights the % change in the investment portfolio value (£591.3m) as well as the subsequent impact on NAV per share ◼ As of 30 September 2018, the remaining weighted average lease life of
Slide 27: Share Price vs NAV per Share
Interim Results for the period ended 30 September 2018 Share Price vs NAV per Share ◼ NESF share price outperformed the FTSE All-Share by 5.7% since IPO ◼ Shareholder total return was 3.4% for the period ended 30 September 2018 (8.4% annualised since IPO) 27
Slide 28: Summary of Debt Financing Terms
Interim Results for the period ended 30 September 2018 Summary of Debt Financing Terms ◼ Total debt outstanding at period end is £365m which represents a gearing of 37% ◼ Average Cost of Debt is 3.7% ◼ NESF entered into a £2.5m counter- indemnity with Santander following the issuance of a £2.0m Lett
Slide 29: Important Notice
Important Notice This document is issued by Next Energy Capital Limited (“NEC”), which is authorised and regulated by the UK Financial Conduct Authority (“FCA”) with registered number 471192. The contents of this document are strictly private and confidential and accordingly may not be published, re
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