Suzlon Energy Ltd · NSE:SUZLON
Suzlon Energy — Q1 FY17 Earnings Presentation
38 slides from Suzlon Energy's earnings presentation, Sep 13, 2016
Slide 1: Suzlon Energy Limited Q1 FY17
Suzlon Energy Limited Q1 FY17 13 September 2016
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 DOES not constitute any offer, recommendation or invitation to purchase or subscribe for any secu
Slide 3: Agenda
Agenda Q1 FY17 Highlights Order Book Solar Vertical Debt Overview Technology Update Industry Opportunity Detailed Financials 3
Slide 4: Q1 Performance Highlights
Q1 Performance Highlights IND AS Stable Q1 FY17 Volumes; ~204 MW Disciplined Working Capital levels; ~61 Days Reducing term debt and overall finance cost; Strong Wind Order Book Position; ~1,205 MW (as on 30th June 2016) Ongoing Divestment of Solar Bid Capacity 4
Slide 5: Q1 Volume Trend
Q1 Volume Trend Revenue Recognition Volumes (Fig. in MW) 1,131 926 454 Balance 9 Months 233 Q1 Volumes 221 205 204 FY15 FY16 FY17 Q1 typically is 10-15% of the full year volume in India 5 Stable Q1 volumes; Improved liquidity leads to growth volume in next 9 months
Slide 6: Result Snapshot (Consolidated)
Result Snapshot (Consolidated) (Rs. Crs.) As per IND AS As per IND GAAP Particulars Q1 FY17 Q4 FY16 Q1 FY16 Q1 FY17 Q4 FY16 Q1 FY16 Limited Review Unaudited Unaudited Unaudited Audited Limited Review Revenue 1,650 3,246 2,587 1,649 3,245 2,606 Gross Profit 735 1,163 1,029 733 1,168 1,046 Gross Margi
Slide 7: Q1 FY17 IND GAAP to IND AS Bridge
Q1 FY17 IND GAAP to IND AS Bridge Reported Net Profit / (Loss) after Tax (Rs. Crs.) -144 -90 -20 -6 -260 As per IND GAAP FX Gain / Loss Net Finance Cost Others As per IND AS 7
Slide 8: Net Working Capital Bridge
Net Working Capital Bridge IND AS Consolidated Net Working Capital (Rs. Crs.) Increase in inventory offset by reduction in debtors 51 days 6 61 days 273 556 1,419 524 1,172 To cater to growth Recovery of Q4 FY16 volumes in balance 9 receivables built-up months Mar’16 Inventory Builtup Payables reduc
Slide 9: Operation and Maintenance Service Business
Operation and Maintenance Service Business IND AS Service Revenues (Rs. Crs.) Growing into a sizeable & profitable business +5.5% ― ~24% revenue share in Q1 FY17 426 404 31 Annuity like business Internal 33 ― Non cyclical business in nature ― Steady cash flow generation External 371 395 100% r
Slide 10: Agenda
Agenda Q1 FY17 Highlights Order Book Solar Vertical Debt Overview Technology Update Industry Opportunity Detailed Financials 10
Slide 11: Strong Wind Order Backlog
Strong Wind Order Backlog Order Book (Fig. in MW) 166 -204 Rs. 7,657 Crs. 101 1,306 1,243 1,205 10% PSU 86% IPP Mar’16 Net Intake Q1 RR Jun’16 Orders announced Total post 30 Jun’16 Backlog for Operation and Maintenance Service, SE Forge and Solar is over and above 11 Firm order book backed by custom
Slide 12: Agenda
Agenda Q1 FY17 Highlights Order Book Solar Vertical Debt Overview Technology Update Industry Opportunity Detailed Financials 12
Slide 13: Solar Bidding Status Update
Solar Bidding Status Update 515 MW Rs. 5.36 340 MW 100 MW Divested Bids Won Per unit PPA signed (49% Stake) average tariff State Bids Won Configuration Off-taker Average Tariff PPA Signed 1 x 100 MW Telangana Telangana(1) 210 MW 1 x 50 MW Rs. 5.58 / Unit Y DISCOMs 4 x 15 M 1 x 100 MW, Jharkhand 175
Slide 14: Agenda
Agenda Q1 FY17 Highlights Order Book Solar Vertical Debt Overview Technology Update Industry Opportunity Detailed Financials 14
Slide 15: Debt Profile
Debt Profile (As on 30th June 2016) Consol. Debt (Excluding FCCBs) 5 Year’s Maturity Profile (excluding FCCBs) Rupee Term Debt (A) Rs. 2,805 Crs. For FX Term Debt (US$ Mn) 657 * Credit Enhanced Debt US$ 647 M Rs. 4,369 Crs. 11 11 7 7 (SBLC Backed) Others US$ 52 M Rs. 352 Crs. FY17 FY18 FY19 FY20 FY2
Slide 16: July 2019 FCCB Series Overview
July 2019 FCCB Series Overview FCCB Principal Value (US$ Mn) 547 Current and Diluted No. of Shares (Crs.) Current Outstanding 502 299 Pending Conversion 97 248 Post Full Conversion 599 Conversion Details Price (Per Share) Rs. 15.46 July’14 Conversions till date Current Exchange Rate Rs. 60.225 16 Up
Slide 17: Consolidated Net Finance Cost
Consolidated Net Finance Cost IND AS Net Finance Cost (Rs. Crs.) -25% 385 -4% 301 290 Q1 FY16 Q4 FY16 Q1 FY17 Note: Senvion was fully divested by Suzlon group on 29th April 2015. Accordingly Q1 FY16 consolidated results include 1 month of Senvion performance, hence not directly comparable 17 Tighter
Slide 18: Agenda
Agenda Q1 FY17 Highlights Order Book Solar Vertical Debt Overview Technology Update Industry Opportunity Detailed Financials 18
Slide 19: Globally Proven In-House R&D Capabilities
Globally Proven In-House R&D Capabilities Suzlon Technology Locations: Hamburg - Development & Integration Hamburg - Certification Germany Rostock - Development & Integration Rostock - Design & Product Engineering - Innovation & Strategic Research The Netherlands Hengelo - Blade Design and Integrati
Slide 20: 2.1 MW Series: Proven Platform with 100,000,000 Operating Hours
2.1 MW Series: Proven Platform with 100,000,000 Operating Hours Higher energy yield Lower cost of energy Higher returns ~65% Increase in Energy Yield S88-80 S9X-90 S97-120 S111-90 S111-120 >5.7 GW >1.8 GW >800 MW sold >300 MW sold Prototype Installed till date Installed till date ~330 MW Installed ~
Slide 21: Hybrid Towers – Innovation at Work
Hybrid Towers – Innovation at Work Hybrid Tower - Combination of lattice and tubular • Higher hub height (120 M) at optimized cost ‒ Reduced LOCE due to higher AEP ‒ Reduced steel requirement ‒ Lower foundation cost ‒ Logistic friendly – access to sites that were earlier logistically challenging • A
Slide 22: Global Coverage - Next Generation Products
Global Coverage - Next Generation Products ~20% reduction in Wind Levelized Cost Of Electricity (LCOE) 10% LCOE Reduction 10% LCOE Reduction Over S97 Over S111 S97 S111 S128 Product S128 – 2.6 MW S128 – 3.0 MW MW Rating 2,600 kW 3,000 kW Rotor Diameter 128 meters 128 meters Tower Height 120 m - 140
Slide 23: Agenda
Agenda Q1 FY17 Highlights Order Book Solar Vertical Debt Overview Technology Update Industry Opportunity Detailed Financials 23
Slide 24: India: Strong Growth Fundamentals for Renewables
India: Strong Growth Fundamentals for Renewables Estimated India Power Demand Renewables Target 2022 (Billion Units) (GW) +132 GW 175 >4000 Others +9% 40 Solar Rooftop 60 Solar Utility Scale 1108 43 60 Wind Utility Scale 2015 2030 Mar-16 2022 Source: Ministry of Power Source: MNRE Renewables now 2nd
Slide 25: FY16 Saw Highest Annual Wind Capacity Addition in Two Decades
FY16 Saw Highest Annual Wind Capacity Addition in Two Decades India Commissioning Volumes (MW) +26% 4,300 +48% 3,415 3,179 -19% 900 1,161 2,312 2,077 442 1,721 403 415 2,515 2,018 1,870 1,674 1,306 FY12 FY13 FY14 FY15 FY16 FY17E* Suzlon Others *FY17 E – Source: Internal Estimates 25 On a strong grow
Slide 26: State Wise FiT and RPO Details
State Wise FiT and RPO Details Tariff Control Period Non AD Tariff (Rs./Unit) RPO Target (Non Solar) FY17 FY16 FY17 FY16 AP 31st March 2020 4.84 4.83 4.75% 4.75% GJ 31st March 2019 4.19 4.15 8.25% 7.00% KN 31st March 2018 4.50 4.50 11.00% 10.00% MP 31st March 2019 4.78 5.92 6.50% 6.00% TN 31st March
Slide 27: Key Government Initiatives: Preparing India for Renewable Growth
Key Government Initiatives: Preparing India for Renewable Growth Strengthening Grid and Future Growth Drivers Strengthening Demand Environment transmission systems (Policy Under Draft) ‒ Introducing Renewable Generation ‒ Green Corridor ‒ Wind Solar Hybrid Farms Obligation (RGO) ‒ Scheduling and For
Slide 28: Suzlon Strengths in India Wind Market
Suzlon Strengths in India Wind Market Full Turnkey Solution Pan India Presence Provider Target Strong Customer Technology Leadership Relationship REGAIN 50%+ MARKET SHARE Best In Class Service 20+ Years Track Record Capabilities 28 End-to-end service provider with strong presence across value chain
Slide 29: International Market Roadmap
International Market Roadmap FY18 FY19 Europe Latin America FY20 North America APAC EMEA Global Wind Industry Outlook (GW) 332 GW 74 69 70 58 61 19 17 17 13 America 16 16 16 15 16 EMEA 13 33 36 37 39 APAC 30 2016E 2017E 2018E 2019E 2020E Source: BENF Q2 2016 Wind Market Outlook 29 Prioritizing marke
Slide 30: Agenda
Agenda Q1 FY17 Highlights Order Book Solar Vertical Debt Overview Technology Update Industry Opportunity Detailed Financials 30
Slide 31: Consolidated Income Statement
Consolidated Income Statement IND AS Rs Crs. Particulars Q1 FY17 Q4 FY16 Q1 FY16 Limited Review Unaudited Unaudited Revenue from operations 1,650 3,246 2,587 Less: COGS 914 2,082 1,558 Gross Profit 735 1,163 1,029 Margin % 44.6% 35.8% 39.8% Employee benefits expense 259 234 329 Other expenses (net)
Slide 32: IND AS Convergence – Major Impact Items
IND AS Convergence – Major Impact Items IND GAAP IND AS Description Position Position CDR Recompense Recompense payable is Recompense considered as financial liability Upon exit from CDR, CDR Lenders disclosed under contingent and quarterly provisions to be made until exit of get a right to recompen
Slide 33: IND AS Convergence – Major Impact Items
IND AS Convergence – Major Impact Items IND GAAP IND AS Description Position Position FCCB FCCB is treated as a compound financial FCCB was treated as a debt instrument and accordingly equity component is instrument. Further, cost recognised. The cost incurred for restructuring Accounting for FCCB i
Slide 34: Reconciliation between IND GAAP and IND AS – Income Statement
Reconciliation between IND GAAP and IND AS – Income Statement Rs Crs. Net Profit Q4 FY16 Q1 FY16 FY16 Reported Consolidated Profit / (Loss) as per IND GAAP (271) 1,047 483 Effect of discounting long term liabilities (7) (5) (24) Acturial gain/ (loss) on defined benefit obligation recognised in other
Slide 35: Consolidated Net Working Capital
Consolidated Net Working Capital IND AS Rs Crs. 30th Jun’16 31st Mar’16 31st Dec’15 Inventories 3,078 2,554 2,512 Trade receivables 2,060 2,616 1,946 Loans & Advances and Others 1,675 1,481 1,637 Total (A) 6,814 6,651 6,095 Sundry Creditors 2,540 2,813 2,347 Advances from Customers 1,116 1,130 862 P
Slide 36: Key Accounting Policies – Revenue Recognition and Order Booking
Key Accounting Policies – Revenue Recognition and Order Booking Opening Order Book • Sales (WTG Revenue Recognition) (-) Sales during the period ‒ WTG revenue is recognised upon transfer of risks and rewards to the buyer of complete WTG viz: Nacelle, Blade and Tower. (+) Order Intake during • Order
Slide 37: Key Accounting Policy: Maintenance Warranty Provisions
Key Accounting Policy: Maintenance Warranty Provisions Maintenance Warranty Provisions Accounting Policy: (Average calculated as % of Revenue) ― Comprise of provisions created against maintenance warranty issued in connection with WTG sale 3.5% Created when revenue from sale of wind turbine is r
Slide 38: Thank You
CIN of Suzlon Energy Ltd - L40100GJ1995PLC025447 THANK YOU 38