Renewables Infrastructure Group Limited GBP Red.Shs · LSE:TRIG
Renewables Infrastructure Group Limited GBP Red.Shs — The Renewables Infrastructure Group — FY2014 Earnings Presentation
37 slides from Renewables Infrastructure Group Limited GBP Red.Shs's earnings presentation, Feb 25, 2015
Slide 1: The Renewables Infrastructure Group Annual results 2014
THE RENEWABLES INFRASTRUCTURE GROUP Annual results for the year to 31 December 2014 25 February 2015 www.TRIG-Ltd.com
Slide 2: Contents
CONTENTS Section Page Overview 3 Portfolio and operations 9 Financials 13 TRIG – A Differentiated Proposition 20 Appendices 22 Contacts 36 This presentation and subsequent discussion may contain certain forward looking statements with respect to the financial condition, results of operations and bus
Slide 3: Overview
ATRIG OVERVIEW
Slide 4: Overview: TRIG
OVERVIEW: TRIG Investment Proposition ▲ Investing in operating renewables projects in UK & Northern Europe, and in proven technologies (onshore wind & solar PV) ▲ Defensive nature of long-term revenues ▲ Inflation-linked dividend yield of c.6% p.a.1 o Met performance and distribution targets since I
Slide 5: Overview: Financial Highlights
OVERVIEW: FINANCIAL HIGHLIGHTS For the year to 31 December 2014 Results Profit before tax: £23.3m (2013 – 5 months: £10.3m) TRIG Dividend Schedule Earnings per share: 6.2p (2013: 3.4p) NAV per share: 102.4p (2013: 101.5p) Total Shareholder Return: 7.5% in 2014 (FTSE-All share total return: 1
Slide 6: Overview: Portfolio
OVERVIEW: PORTFOLIO Acquisitions increased the portfolio 57% by value, 52% by capacity Portfolio Activity March Solar June Wind August Solar November Wind Performance in line with expectations Stour Fields Tallentire Parley Court Farm Earlseat 18.7 MW 24.2 MW 16.0 MW o Generated 814GWh of electric
Slide 7: Overview: Financing Activity
OVERVIEW: FINANCING ACTIVITY For the year to 31 December 2014 £13m reinvestment of cash generated internally in year £120m revolving acquisition facility in place with two major banks o £60m drawn at the year end £105m of equity raised in 2014 12-month Share Issuance Programme launched in De
Slide 8: Overview: Market Dynamics
OVERVIEW: MARKET DYNAMICS Power Energy Government Discount Prices Yield Support Rates Lower in 2014 Benefits of Robust in TRIG’s Continuing demand Upside potential? diversification target markets for assets Portfolio Average Power Price Assumptions UK Gilt Yields % IPO Now Source: TRIG assumptions,
Slide 9: Portfolio and Operations
ATRIG PORTFOLIO AND OPERATIONS
Slide 10: Operational Performance
OPERATIONAL PERFORMANCE Benefits of diversification in evidence Electricity Production1 Against P50 Estimates At Acquisition Operational Output 12 months IPO (5 months) IPO (17 months) Produced 814 GWh of electricity in the year Segment to Dec 2014 to Dec 2013 to Dec 2014 (20131: 345 GWh) Within
Slide 11: Portfolio Diversification (31 December 2014)
PORTFOLIO DIVERSIFICATION (31 DECEMBER 2014) By Jurisdiction / By Technology / Power Market1 2 Weather System2 3 By Revenue Type4 (by portfolio valuation) (by portfolio valuation) (by 2015 projected portfolio revenue) France Republic of 9% Ireland / PPA Market Solar PV Onshore Wind / Revenue Fixed P
Slide 12: Operations Management
OPERATIONS MANAGEMENT Breadth and depth of capability provided by RES Managing performance RES: Resourcing Structure • Availability – minimising lost production, fault rectification • Generation – maximising output, maintenance planning, turbine & grid settings • Financial – budget control, minimisi
Slide 13: Financials
ATRIG FINANCIALS
Slide 14: Valuation – Key Assumptions
VALUATION – KEY ASSUMPTIONS 31 December 2014 31 December 2013 Discount Rate1 Weighted Average 9.0% 9.8% Energy Yield All markets Third party acquisition P50 – central case Third party acquisition P50 – central case Based on updated third party forecasts (with Based on updated third party forecasts (
Slide 15: Portfolio Valuation Bridge
PORTFOLIO VALUATION BRIDGE Robust performance in 2014 Valuation Movement in the Year (£m) 1 1. The foreign exchange movement at the portfolio level excludes £1.2m gain in 2014 as a result of currency hedging arrangements in place at the Company level, resulting in a net effect of -£2.0m. 15
Slide 16: 2014 Change in Accounting Basis
2014 CHANGE IN ACCOUNTING BASIS ▲ December 2013: TRIG adopted IFRS 10 o Enabled TRIG to carry its investments at fair value (“Investment Basis”) rather than line-by-line consolidation ▲ December 2014: IFRS 10 was amended to clarify treatment of Investment Entity subsidiaries o TRIG UK (TRIG’s portfo
Slide 17: Summary Income Statement
SUMMARY INCOME STATEMENT A continuation of TRIG’s robust performance since launch Year ended 5 months ended 31 December 2014 31 December 2013 £m £m IFRS Basis Adjustments Expanded Basis Expanded Basis Total operating income 23.1 7.0 30.1 15.2 Acquisition costs - (1.5) (1.5) (3.2) Net operating incom
Slide 18: Summary Balance Sheet
SUMMARY BALANCE SHEET Portfolio growth through acquisitions; incremental uplift in NAV after power price adjustments At 31 December 2014 At 31 December 2013 £m £m IFRS Basis Adjustments Expanded Basis Expanded Basis Portfolio value 412.4 60.5 472.9 299.81 Cash 12.4 0.5 12.9 16.2 Debt - (60.1) (60.1)
Slide 19: Summary Cash Flow
SUMMARY CASH FLOW Distributions on target Year ended 5 months ended 31 December 2014 31 December 2013 £m £m IFRS Basis Adjustments Expanded Basis Expanded Basis Cash from investments 25.6 9.7 35.3 13.2 Operating and finance costs outflow (1.0) (3.7) (4.7) (0.3) Net cash inflow before acquisitions an
Slide 20: TRIG – A Differentiated Proposition
TRIG – A DIFFERENTIATED PROPOSITION
Slide 21: TRIG: A Differentiated Proposition
TRIG: A DIFFERENTIATED PROPOSITION ▲ Solid operating performance in 2014 and since IPO ▲ Delivering target returns: 6% cash yield with surplus reinvestments ▲ Benefits of substantial, diversified portfolio ▲ Healthy acquisition pipeline with selective approach across segments ▲ Distinct management c
Slide 22: Appendices
ATRIG APPENDICES 22
Slide 23: Portfolio Composition (31 December 2014)
PORTFOLIO COMPOSITION (31 DECEMBER 2014) 439 MW capacity / 29 projects – largest and most diversified portfolio in the sector Capacity Turbine (MW) Project Market (MW) Commissioning1 /Panel Roos GB (Eng) 17.1 2013 Vestas (1.9) Grange GB (Eng) 14.0 2013 Vestas (2.0) Tallentire GB (Eng) 12.0 2013 Vest
Slide 24: Counterparty Exposures
COUNTERPARTY EXPOSURES Broad spread of high quality equipment, maintenance and off-take counterparties ▲ Main credit exposure is to national governments through subsidy commitments (both directly and indirectly) ▲ Commercial counterparties performing as expected – power off-takers, equipment and mai
Slide 25: Diversification by Project Revenue Type
DIVERSIFICATION BY PROJECT REVENUE TYPE Revenue from PPAs, FITs, ROCs, LECs… December 2014 Portfolio: Evolution of Annual Project Revenues Under Current Contracts1 MARKET (green) FIRM (blue) Revenue Characteristics2 Framework Counterparty Wholesale Power (merchant) Market price, PPA typically 15 yea
Slide 26: NAV Sensitivities
NAV SENSITIVITIES Based on portfolio as at 31 December 2014 Impact on NAV per share at 31 December 2014 (£ labels represent impact on Portfolio Value of £472.9m) 26
Slide 27: Cash Flow and NAV Outlook
CASH FLOW AND NAV OUTLOOK Based on portfolio as at 31 December 2014 Illustration of Long-Term Cash Flows and NAV (including effect of re-investment of surplus after dividend payment) 1. The chart is illustrative only and is not a profit forecast. There can be no assurance that these levels of perfor
Slide 28: Senior Management Team
SENIOR MANAGEMENT TEAM Over 100 years of relevant experience on the TRIG Advisory Committee TRIG Independent Board Helen Jonathan Klaus Shelagh (Non-Executive) Mahy Bridel Hammer Mason (Chairman) Investment matters TRIG Investment Werner Chris Tony James Committee1 von Gill Roper Hall-Smith Guionnea
Slide 29: RES & Operations Management
RES & OPERATIONS MANAGEMENT TRIG’s leading edge in unrivalled experience, in-house IP and technical expertise RES brings a complete reliability monitoring service to TRIG Full access to an integrated team of experts in engineering, technical and asset management (30+ staff) RES knowledge from a
Slide 30: EU – New Power Capacity Installations
EU – NEW POWER CAPACITY INSTALLATIONS Onshore wind and solar PV dominating European new power capacity 2013 Share of EU New Power Capacity Installations (Total = 35GW) 2014 Share of EU New Power Capacity Installations (Total = 27GW) Source: Data from EWEA Annual Statistics (Copyright The European Wi
Slide 31: UK Market – Renewable Electricity Growth
UK MARKET – RENEWABLE ELECTRICITY GROWTH Production variability depends on technology-related seasonality and weather outcomes UK Overall Electricity Production From Renewable Sources Quarterly: 2010 Q1 – 2014 Q3 Electricity production (GWh) Source: DECC (December 2014) 31
Slide 32: EU – Progress Towards Renewables Targets
EU – PROGRESS TOWARDS RENEWABLES TARGETS Challenging targets for many countries Progress in Europe towards Renewables’ Targeted Contributions to Total Energy Consumption (Electricity, Heat and Transport) 2012 actual v 2020 targets % of energy from renewables 15% Source: Eurostat March 2014 32
Slide 33: Renewable Energy – Sustained Growth
RENEWABLE ENERGY – SUSTAINED GROWTH Significant further investment required to meet the UK’s EU 2020 renewables targets Onshore Wind and Solar PV: UK Installed Base & Development Pipeline (MW)3 3 Sources: DECC / InfraRed 33
Slide 34: TRIG: Key Facts
TRIG: KEY FACTS Fund Structure ▲ Guernsey-domiciled closed-end investment company Return Targets1 ▲ Initial 6.0p annualised dividend, increasing with inflation over the medium term; targeting 3.08p for 6 months to 30 June 2015 Issue / Listing ▲ Premium listing of ordinary shares on the Main Market o
Slide 35: Glossary
GLOSSARY ▲ CfD contract for difference: typically , a contract between a buyer and seller, stipulating that the seller will pay to the buyer the difference between a pre-agreed price of an asset or commodity and its actual (if higher) value at contract time (if the value is lower, then the buyer pay
Slide 36: Contacts
CONTACTS INVESTMENT MANAGER OTHER ADVISERS INFRARED CAPITAL PARTNERS LTD ADMINISTRATOR / COMPANY SECRETARY REGISTRAR 12 CHARLES II STREET DEXION CAPITAL (GUERNSEY) LTD CAPITA REGISTRARS (GUERNSEY) LTD LONDON SW1Y 4QU 1 LE TRUCHOT MONT CREVELT HOUSE +44 (0)20 7484 1800 ST PETER PORT BULWER AVENUE KEY
Slide 37: Important Information
IMPORTANT INFORMATION By attending the meeting where this presentation is made, or by reading the presentation slides, you agree to be bound by the following limitations: This document is an advertisement and is not a prospectus. Any decision to purchase shares in The Renewables Infrastructure Compa
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