Energy One Limited · ASX:EOL
Energy One — Merger or Acquisition (January 2022)
38 slides from Energy One's merger presentation, Jan 31, 2022
Slide 1: Energy One to acquire CQ Energy (Australia)
ABN 37 076 583 018 ASX EOL ASX Announcement For personal use only 31 January 2022 Energy One to acquire CQ Energy (Australia) Sydney, Australia - Energy One [ASX:EOL] today announces that it has entered into a share purchase agreement (SPA) to acquire 100% of the shares / units of CQ Energy Group, e
Slide 2: For personal use only
In its first full financial year post consolidation Energy One expects CQ to contribute approximately A$7 million revenue and A$4.5 million EBITDA. Further information and financial detail will be included in the half-year reporting, once integration is For personal use only underway. Authorised by
Slide 3: Energy One Limited announces the acquisition of CQ Energy
Energy One Limited (ASX:EOL) or personal use only Announces the acquisition of CQ Energy
Slide 4: Disclaimer
Disclaimer or personal use only This document has been prepared by Energy One Limited (EOL) and comprises written materials and slides for a presentation concerning EOL. This presentation is for information purposes only and does not constitute or form part of any offer or invitation to acquire, sel
Slide 5: Contents
Contents or personal use only About CQ Energy 5 Transaction financials 15 Strategy 19 Appendix 30 3
Slide 6: Energy One signs share purchase agreement to acquire 100% of CQ Energy
Energy One is pleased to announce it has signed a share purchase agreement to or personal use only acquire 100% of CQ Energy 4
Slide 7: CQ Energy is our largest acquisition to date
CQ Energy is our largest acquisition to date… or personal use only • Based in Adelaide Australia, CQ Energy provides 24/7 operational energy services. • CQ is our largest acquisition to date and will increase existing EBITDA by roughly 50% • It is a well established, profitable company with a loyal
Slide 8: About CQ Energy
About CQ Energy Established in 2008 and based in Adelaide CQ Energy is the leading supplier of operational energy services to the Australian gas and electricity sector. They provide similar 24x7 or personal use only operational services as our European businesses eZ-nergy and Egssis. Typical clients
Slide 9: CQ is the largest provider of 24/7 operational energy services in Australia
CQ is the largest provider of 24/7 operational energy or personal use only services in Australia The acquisition of CQ marks our entry into the energy services business in Australia. Energy markets across the globe are decarbonizing and de-centralising. As large thermal power stations become a thing
Slide 10: Operational services include
Operational services include or personal use only 1) Bidding, scheduling and dispatch services : Electricity - bidding generation into the NEM on behalf of clients based on agreed strategies. Gas - managing the day-to-day nominations for gas supply agreements and gas transportation agreements 2) Con
Slide 11: CQ is facilitating the entry of renewable generation into the national electricity market
CQ is facilitating the entry of renewable generation into the national electricity market or personal use only CQ offers software and services for: • Electricity dispatch • Algo trading in the spot market • Managing contract positions in the forward market • 24/7 operational control room services •
Slide 12: Algo-trading and process automation are exciting opportunities to increase market share
Algo-trading and process automation are exciting opportunities to increase market share or personal use only Combining algo-trading and business process automation will be a major product differentiator in the 24/7 services market. These additional services will appeal not only to customers with DIY
Slide 13: CQ also runs a very sophisticated consulting and broking business
CQ also runs a very sophisticated consulting and broking business or personal use only Operational services accounts for about two thirds of CQ’s revenue the other third comes from a consulting and risk transfer broking business. The risk transfer and broking business includes, among other things, t
Slide 14: Excellent management with strong cultural fit
Excellent management with strong cultural fit or personal use only • The executive and technical team at CQ are of a very high calibre. • Culturally, the management teams are a good fit • Management teams at EOL and CQ are excited about the opportunity of providing operational control room services
Slide 15: This is a strategic acquisition placing us at the heart of the emerging 24/7 services market
This is a strategic acquisition placing us at the heart of the emerging 24/7 services market or personal use only 13
Slide 16: Key benefits of the acquisition
Key benefits of the acquisition The acquisition: • Builds on our European expertise in energy or personal use only services • Expands our reach in Australia • Increased market share in the global 24/7 scheduling and nomination services • A strong competitive advantage by: – using EOL’s existing auto
Slide 17: Transaction financials
Transaction financials or personal use only 15
Slide 18: Total cost of acquisition is $36M
or personal use only Total cost of acquisition is $36M AUD Consideration Payable $6.0M Equity On Completion $26.4M Cash On Completion $1.8M Cash 6 months post completion $1.8M Cash 12 months post completion $36.0M Total Consideration EBITDA multiple paid is 8x based on proforma expectations. The equ
Slide 19: The acquisition will increase annual proforma revenue by $7M and EBITDA by $4.5M
The acquisition will increase annual proforma revenue by $7M and EBITDA by $4.5M or personal use only EOL FY21A CQ 12month proforma Revenue $27.9M ~$7.0M EBITDA $8.1M ~$4.5M+ Looking forward to the first full financial year we expect CQ Energy will generate income of approximately AUD$7.0M and EBITD
Slide 20: The acquisition will be self funded with a combination of debt and equity
The acquisition will be self funded with a combination of debt and equity or personal use only • We have negotiated an indicative term sheet for a new acquisition facility • The $30M facility amortises over 7-years • The facility will be provided by a major bank with interest rates and fees similar
Slide 21: Strategy
or personal use only Strategy 19
Slide 22: Building a global energy services business
Building a global energy services business will place Energy One at the forefront of the green energy revolution or personal use only • We’ve seen energy services markets in both Europe and Australia growing with the development of new distributed renewable energy. • The acquisition of CQ Energy, Eg
Slide 23: Energy One is now number one provider of 24/7 operational energy services in Australia
Energy One is now the number one provider of 24/7 operational energy services in Australia and the number two provider in Europe or personal use only 21
Slide 24: With control rooms in Europe and Australia we will provide 24/7 global coverage
With operational control rooms in Europe and Australia we will provide 24/7 global coverage or personal use only • In time we will look to utilise control rooms to provide a follow the sun global service. • Two geographically distanced control rooms also provides redundancy and backup, a unique prop
Slide 25: Covering all the bases and providing real time trading solutions
Covering all the bases and providing real time trading solutions for energy markets or personal use only Market type Forward Day ahead Real time Task Contracts & Balancing Portfolio Scheduling/ Intraday/ Derivatives optimisation Nominations algo-trading eZ + Egssis Software & 24/7 services Algo-trad
Slide 26: None of our traditional competitors provide 24/7 operational energy services
None of our traditional competitors provide 24/7 operational energy services or personal use only Many of our competitors only provide ETRM software to manage financial derivatives. For a long time we have focused on the physical side of the equation with dispatch and scheduling software to provide
Slide 27: Combining our software with a premium service offering
Combining our software with a premium service offering gives us an enviable position in facilitating the entry of renewable energy or personal use only into national electricity markets SaaS Services Algo trading software Managing the bidding and Auto bidding Energy Services scheduling of software d
Slide 28: EOL introduces Software with a Service
EOL introduces Software with a Service or personal use only Renewable generators require sophisticated software to operate in national energy markets. However these same renewable generators often don’t have, or don’t want, the hassle associated with the resources required to operate the software. T
Slide 29: The expansion into services is a logical progression of our long-term strategy
The expansion into services is a logical progression of our long-term strategy or personal use only Diversification Grow customer base Invest in new products Grow by acquisition • Battery software Target a larger Cross-sell products number of smaller • Combine products Acquire complementary customer
Slide 30: Expanding into operational services considerably increases our addressable market
or personal use only Expanding the physical side of our business into operational services will also see a considerable increase in our addressable market as we move from a niche market to a much larger industrial type market. 28
Slide 31: Appendix: Additional information
Appendix Additional information or personal use only 29
Slide 32: Energy One independent SaaS & Services company
• Energy One Limited (ASX:EOL) is a leading Energy One independent global supplier of Energy Trading - a profitable and Risk Management (ETRM) software systems and services. SaaS & or personal use only • Hybrid business model of recurring (SaaS) Services revenue (80%) and project T&M (20%) in FY21 c
Slide 33: Supplying large blue chip companies in essential industries
Supplying large Our customers are often large: blue chip • Utilities – such as power stations and or personal use only vertically integrated retailers companies in • Infrastructure providers – such as gas pipelines, electricity transmission essential • Industries industries • Market traders, banks a
Slide 34: EOL's suite of software tools used to manage exposure to risk and volatility
EOL’s suite of software tools are used by customers to manage their exposure to risk and volatility or personal use only Our software is used to trade and manage both physical energy and derivative contracts either bilaterally (B2B) or on public exchanges. 32
Slide 35: Many energy market participants use EOL group software
Many energy market participants use EOL group software only Exchange Traded Electricity Derivatives Energy Generators: Consumers - Solar farms (Domestic) - Wind farms Spot Market Traded energy - Hydro for Electricity Energy - Batteries Retailers/ use - Coal fired OTC Contracts, PPA’s Suppliers - Gas
Slide 36: A comprehensive suite of software and services
A comprehensive suite of software and services or personal use only Physical Bidding ETRM Business Process Automation Allows a power station to bid it’s Contract management for recording Many systems and contracts in energy electricity (quantity, price, time and physical trades (PPA’s) and financial
Slide 37: EOL group software makes life easier
EOL group software makes life easier Participant Challenges faced EOL group solutions or personal use only Generators Accurate, compliant energy spot market bidding and nominations ü Efficiently dispatching generation ü Energy operations (B2B, bid preparation, monitoring, compliance) ü Hedging outpu
Slide 38: Mr Shaun Ankers – Group CEO and Managing Director
or personal use only Mr Shaun Ankers – Group CEO and Managing Director Email: enquiries@energyone.com 77 Pacific Highway North Sydney NSW 2060 +61 2 8916 2200