Edp S.a. · EURONEXT:EDP
Edp — Energias de Portugal — Debt Investor Presentation (November 2022)
29 slides from Edp's debt investor presentation, November 2022
Slide 1: Credit Investors' Presentation
CREDIT INVESTORS’ PRESENTATION November 2022
Slide 2: Disclaimer
Disclaimer This document has been prepared by EDP - Energias de Portugal, S.A. (the "Company") solely Forward-looking statements include statements regarding: objectives, goals, strategies, for use at the presentation to be made on this date and its purpose is merely of informative outlook and growt
Slide 3: Global company, leader in the energy sector, present in 29 markets
We are a global company, leader in the energy sector, present in 29 markets throughout different stages of the value chain % Weight on EBITDA 2021 ~62% Renewables Wind, Solar & Hydro ~36% Networks Distribution Transmission 21% 32% EBITDA Client solutions & €3.7 Bn ~3% energy management 20% New Clien
Slide 4: Key credit strengths
Key credit strengths Attractive, resilient and integrated business model with stable margins, ✓ Integrated operations across energy value chain allows for successful risk mitigation visible cash flow generation and ✓ Strong protection against inflation through long-term offtake contracts and long-du
Slide 5: Business Strategy Execution
Business Strategy Execution 9M22 | Results Presentation 5
Slide 6: Committed to lead the Energy Transition in Renewables
We have started this journey in Renewables over 2 decades ago and are committed to continue to lead the Energy Transition By 2025 By 2030 €24 Bn >50 GW CAPEX in energy transition renewables additions Leading the energy transition to create superior value 4 GW/yr 100% renewables deployed renewables g
Slide 7: Diversified presence across technologies and geographies
Diversified presence across technologies and geographies, with differentiating value propositions Strong visibility Hydro Global leadership Extensive pipeline with Top 4 global player additions ramping up quickly Mostly maintenance investments Differentiation Cost competitiveness Solar Cash generato
Slide 8: +10.8 GW capacity additions secured, evenly split per geography
We have +10.8 GW capacity additions secured (55%) evenly split per geography 4.4 3.5 North America GW Europe GW 50% committed 52% committed 1.5 GW 2.8 GW 0.2 GW 6.7 1.5 GW 0.8 GW 1.0 GW 0.2 GW post 2025 8.8 20 GW1 1.1 GW Gross post 2025 Additions 2021-25 1.4 2.2 South America 2.9 APAC 0.8 GW GW 76%
Slide 9: Investment fully aligned with the energy transition
EDP’s investment is fully aligned with the energy transition, with 95% of the investment focused on Renewables and Networks Investment acceleration … with strong focus on Renewables, across vs previous target… key markets in Europe and North America CAPEX1, € Bn/yr CAPEX1, Cumulative, € Bn, 2021-25
Slide 10: Well protected against inflationary and interest rate pressures
EDP well protected against inflationary and interest rate pressures with >70% of non-fixed revenues EDP Revenues(1) with limited exposure to inflation Potential upside from 2023 onwards as hedges roll over 100% ~35% Natural hedge to inflation ~40% ~25% (2) Total Revenues Merchant/ Inflation linked F
Slide 11: Asset Rotation program keeps delivering value
EDP Asset Rotation program keeps delivering value, with €3.4bn of AR proceeds secured, >40% of the €8bn target for 2021-25 AR net GW/year AR Gains/year AR Gains/MW GW €bn €m AR Proceeds 1.4 +1.5x 0.4 +2x 0.5 ~0.3 1.0 ~0.2 In line with BP Guidance €3.4bn BP Executed BP Executed BP Executed Guidance 2
Slide 12: 9 asset rotation deals in 6 markets in 2021-22
9 asset rotation deals in 6 markets in 2021-22 reaching >40% of target proceeds for 2021-25 AR proceeds 2021-2022 €bn 2022 2021 Closed Signed ~3.4 ~0.25 (1) ~0.35 0.4 0.3 0.3 0.5 0.4 0.2 0.5 AR Proceeds 405 MW 200 MWac 302 MW 221 MW 149 MW 181 MW 172 MW 260 MW 200 MWac MW Gross 80% 80% 100% 100% 100
Slide 13: Governments joining forces to foster renewables growth
Governments are joining forces to foster renewables growth, while context of high energy prices pushes for additional regulation in EU countries IRA represents unprecedented US Scenarios of price stabilization and commitment on climate, aiming to regulation from European governments reduce carbon em
Slide 14: 2023 electricity regulated tariffs proposal in Portugal
2023 electricity regulated tariffs proposal in Portugal (Oct.17 th): Despite high electricity wholesale prices, retail tariffs stable, system debt down by €2bn Reg. Electricity Tariff components Wholesale Price vs Renewables FiT Electricity System Debt Residentials end-user tariffs2; €/MWh €Bn 3 1 E
Slide 15: Electricity Networks in Portugal 2023 regulated revenues +2%
Electricity Networks in Portugal 2023 regulated revenues +2% supported by indexation to Portugal 10-year bond yields and inflation Electricity Distribution regulated revenues ERSE’s proposal 2022 2023 YoY Annual RoRAB indexed to 10-year Portuguese Regulated bond yields1 Revenues €1,029m €1,050m +2.0
Slide 16: Strong liquidity position covering refinancing needs beyond 2024
Strong liquidity position covering refinancing needs beyond 2024 Financial Liquidity as of Sep-22 (Bn) Debt breakdown by Maturity BRL EUR & USD Cash & Equivalents €3.5Bn 8.3 0.4 Available Credit Lines €5.8Bn Total Liquidity 9M22 €9.3Bn €7.2Bn 7.9 3.0 €1Bn 2.8 Bonds Issued in Oct-22 2.4 0.8 2.2 1.8 0
Slide 17: Significant volumes of LT financing closed in 2021-2022
Significant volumes of LT financing closed in 2021-2022 under attractive market conditions in accordance with our conservative funding policy In 21/22 EDP has issued ~€4Bn through green 9M22 Financial debt breakdown senior bonds & hybrids 2021: Interest Rate Type Currency Sources €2Bn Hybrid issued
Slide 18: Since 2018, EDP issued EUR 8.8b in Green Bonds
Since 2018, EDP issued EUR 8.8b in Green Bonds, in line with EDP’s sustainability strategy EDP’s green bond issuances Total allocated amount as of 2021 2018: EUR 600m 1.875% 7Y Green Bond (1st Green issuance) 2019: Location Technology 1% EUR 1,000m 4.496% NC5.25 Green Hybrid (1st Green Hybrid) 4% 4%
Slide 19: Funding portfolio increasingly reflects commitment to sustainability
EDP’s funding portfolio will increasingly reflect its commitment to sustainability Share of sustainable funding > € 8bn already placed in Green Bond format, aligned with our Sustainability Strategy +11% Continued investment in Renewables and sustainable activities 50% 2025 50% Leveraging on growing
Slide 20: Increase in Net Debt impacted by expansion investment
Increase in Net Debt impacted by the acceleration of Net expansion investment and temporary WC due to higher commodity prices Change in Net Debt € Bn 15.3 +€5.1 Bn Gross Expansions Investments 0.5 -€1.5Bn Asset Rotation Proceeds 0.7 +€0.6 Bn Forex Organic CF 2.9 11.6 1.4 1.1 Net Debt Recurring Cash
Slide 21: Net financial costs increase in 9M22
Net financial costs increase in 9M22 impacted by higher interest rates in Brazil Net Financial Costs Cost of Debt(1) €m >2X Brazil EDP excl Brazil €m +55% 2.4% 2.6% 580 188 533 47 Avg. Cost 150 of Debt 4.3% 356 345 242 Excl. Brazil 11 39 92 3.3% 253 291 9M21 Non- 9M21 Interest 9M22 Non- 9M22 EUR USD
Slide 22: Recurring EBITDA +21% YoY
Recurring EBITDA +21% YoY prompt by good performance of Wind & Solar and Electricity Networks despite the penalizing Iberian hydro shortfall Recurring EBITDA(1,2) €m YoY growth, % ∆ YoY +21% YoY 3,046 2,511 +15% EDPR Installed Capacity +10% YoY excl. FX 1,482 +565m Wind resources in line with LT avg
Slide 23: Recurring Net Profit penalized by higher financial costs in Brazil
Recurring Net Profit penalized by higher financial costs in Brazil and increase of minority interests Recurring Net Profit (1) Reported Net Profit €m Δ YoY €m EBITDA 3,046 +534 +1% YoY D&A and Reported (1) 510m 518m Provisions 1,223 +120 EBIT 1,822 +654 Non-recurring items 0m +6m Net Financial Costs
Slide 24: Resilient portfolio supports 2022 performance and execution of 21-25 plan
Resilient and diversified portfolio support 2022 performance and upfront execution of 21-25 plan, CMD Mar-23 to provide updated targets for 23-27 Maintenance 2022 Recurring Net Profit 2022 > 2021(1) Guidance Current Target Secured Upfront execution Committed renewable capacity 10.8GW 20GW 55% 4.3 GW
Slide 25: Annex
Annex @edp
Slide 26: Prudent financial policy with centralized management
We have a prudent financial policy with a centralized management, committed to a solid investment grade rating Green Credit Active debt Centralized and Interest and financing Rating(1) and liquidity diversified foreign management funding exchange risks Tap most efficient Strong credit metrics Strong
Slide 27: EDP Green Finance Framework
EDP Green Finance Framework, recently updated this year, is aligned with the Green Bond Principles and EU Taxonomy EDP established its first green bond framework in 2018 and has been since a frequent green bond issuer Project Evaluation & Management of Use of Proceeds Selection Proceeds Reporting •
Slide 28: Key Data on EDP debt outstanding
Key Data on EDP debt outstanding Amount Name Currency Coupon Maturity Issue date Market Price (bid) Market Yield ISIN (million) Private Placements EDP BV Private Placement EUR 49 2.661% 23/12/2022 23/12/2002 XS0160258280 EDP BV Private Placement EUR 160 0.000% 12/11/2023 12/11/2008 XS0399353506 Seni
Slide 29: IR Contacts
IR Contacts E-mail: ir@edp.com Phone +351 210 012 834 Site: www.edp.com Investor presentation 29
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