Romande Energie Holding SA · SIX:REHN
Romande Energie Holding SA — FY2012 Earnings Presentation
47 slides from Romande Energie Holding SA's earnings presentation, Mar 26, 2013
Slide 1: 2012 Annual Results
2012 ANNUAL RESULTS Lausanne, 26 March 2013 Pierre-Alain Urech, CEO Denis Matthey, CFO © ROMANDE ENERGIE 23.06.2010 © ROMANDE ENERGIE www.romande-energie.ch
Slide 2: Agenda
1. Romande Energie in 2012 2. Financial results 3. Challenges and outlook 4. Questions © ROMANDE ENERGIE www.romande-energie.ch 2
Slide 3: Romande Energie in 2012: Highlights
Romande Energie in 2012 Highlights One of the top five among 800 power • Lines of business: distribution • Energy companies in Switzerland • Distribution The leading power • Marketing supplier in French- speaking • The Group companies supply Switzerland clients in over 300 municipalities located in
Slide 4: Romande Energie in 2012: Structure
Romande Energie in 2012 Structure Romande ENERGY DISTRIBUTION Energie Business Unit Business Unit COMMERCE ENERGY EFFICIENCY Department Business Support Units Finance, human resources, legal, communications, general services © ROMANDE ENERGIE www.romande-energie.ch 4
Slide 5: Noteworthy events in 2012: Conventional Energy
Romande Energie in 2012 Noteworthy events in 2012 Conventional ENERGY • Work began on modernization of the Farettes hydropower station (near Aigle) with plans to expand production • Work carried out to expand the capacity of installations at Forces Motrices Hongrin-Léman SA (FMHL+) • Positive impact
Slide 6: Noteworthy events in 2012: Renewable Energy
Romande Energie in 2012 Noteworthy events in 2012 Renewable ENERGY • Inhabitants of Sainte-Croix approve wind-farm project. Plans awaiting approval from Vaud canton • Resizing of Provence wind-farm project (16 turbines) following consultation between cantons of Vaud and Neuchatel, and incorporation
Slide 7: Noteworthy events in 2012: Renewable Energy
Romande Energie in 2012 Noteworthy events in 2012 Renewable ENERGY • Commissioning of the two small hydro plants on the drinking water network of Morges • Work began to optimize small hydro plant in Rivaz, using innovative technology to boost output by a factor of 7 • Start-up of project to equip fa
Slide 8: Noteworthy events in 2012: Renewable Energy
Romande Energie in 2012 Noteworthy events in 2012 Renewable ENERGY Hydro plants Small hydro plants Solar farms Biomass plants © ROMANDE ENERGIE www.romande-energie.ch 8
Slide 9: Noteworthy events in 2012: Networks
Romande Energie in 2012 Noteworthy events in 2012 NETWORKS • Commissioning of new grid control centre: migration to a state-of-the-art system • Construction of a new HV sub-station in Villeneuve • Launch of a project for the construction of an operations centre "East" in Villeneuve • Continued work
Slide 10: Noteworthy events in 2012: Customer Relations
Romande Energie in 2012 CUSTOMER Noteworthy events in 2012 RELATIONS • April 2012: Group supplies power directly to over 300,000 customers • The Swiss Federal Electricity Committee (ElCom ) has approved the pricing principles in force at Romande Energie Group while reducing the level of remuneration
Slide 11: Noteworthy events in 2012: Energy Efficiency
Romande Energie in 2012 Noteworthy events in 2012 ENERGY EFFICIENCY • Development of service pack for optimum energy use: thermal solar range added to heat-pump solutions, and audits for households and businesses • High rate of visits to declics.romande-energie.ch, a website for sharing experiences
Slide 12: Noteworthy events in 2012: Partnerships & CSR
Romande Energie in 2012 Noteworthy events in 2012 PARTNERSHIPS & CSR • 25-year partnership with municipalities in the Lower Valais region. Inception of Bas-Valais Energie SA, a subsidiary of Romande Energie providing power to 18,000 customers in eight municipalities • Group's CSR policy now official
Slide 13: 2. Financial results
1. Romande Energie in 2012 2. Financial results 3. Challenges and outlook 4. Questions © ROMANDE ENERGIE www.romande-energie.ch 13
Slide 14: Key figures in 2012
Key figures in 2012 Solid operating results tarnished by ALPIQ Key figures 2012 2011 2010 CHF 000 restated Net revenues 579 412 590 165 579 413 Gross profit 259 682 254 165 239 419 As % of net revenues 45% 43% 41% Operating expenses ( 138 088) ( 133 447) ( 131 827) EBITDA 121 594 120 718 107 592 As
Slide 15: Key figures in 2012
Key figures in 2012 Solid operating results tarnished by ALPIQ Key figures 2012 2011 2010 CHF 000 restated Net revenues 579 412 590 165 579 413 Gross profit 259 682 254 165 239 419 As % of net revenues 45% 43% 41% Operating expenses ( 138 088) ( 133 447) ( 131 827) EBITDA 121 594 120 718 107 592 As
Slide 16: Key figures in 2012
Key figures in 2012 Gradual improvement in key performance indicators Key figures 2012 2011 2010 CHF 000 restated Net revenues 579 412 590 165 579 413 Gross profit 259 682 254 165 239 419 As % of net revenues 45% 43% 41% Operating expenses ( 138 088) ( 133 447) ( 131 827) EBITDA 121 594 120 718 107
Slide 17: Profit by business unit
Key figures in 2012 Profit by business unit © ROMANDE ENERGIE www.romande-energie.ch 17
Slide 18: Profit/loss from affiliated companies causes substantial loss
Key figures in 2012 Profit/loss from affiliated companies causes substantial loss © ROMANDE ENERGIE www.romande-energie.ch 18
Slide 19: Outcome of ATEL/EOS merger
Outcome of ATEL/EOS merger Taking account of ALPIQ's inception in 2009 and fair- value adjustments entered in Group's 2011 and 2012 financial statements Profit booked in 2009: CHF 612 million Impairment in 2011: CHF 292 million Impairment in 2012: CHF 402 million © ROMANDE ENERGIE www.romande-energi
Slide 20: Outcome of ATEL/EOS merger
Outcome of ATEL/EOS merger Despite fair-value adjustments relating to affiliated companies, outcome has been financially positive Impact of EOSH results on profit or Cash received 000 CHF loss from affiliated (EOSH dividends) companies 2009 669 292 139 315 2010 60 861 57 450 2011 ( 254 205) 57 450 2
Slide 21: Key figures in 2012
Key figures in 2012 Profit/loss from affiliated companies causes substantial loss Key figures 2012 2011 2010 CHF 000 restated Net revenues 579 412 590 165 579 413 Gross profit 259 682 254 165 239 419 As % of net revenues 45% 43% 41% Operating expenses ( 138 088) ( 133 447) ( 131 827) EBITDA 121 594
Slide 22: Consolidated balance sheet
Consolidated balance sheet Shareholders' equity (81% of total assets) hit by fair-value adjustments relating to affiliated companies Condensed consolidated balance sheet CHF 000 31.12.2012 31.12.2011 31.12.2010 ASSETS restated restated Current assets 592 878 524 710 527 621 Non-current assets 1 843
Slide 23: Balance sheet figures: change in capital expenditure
Balance sheet figures Change in capital expenditure © ROMANDE ENERGIE www.romande-energie.ch 23
Slide 24: Cash flow
Cash flow Surge in cash and cash equivalents in 2012 Cash flows CHF 000 2012 2011 Cash flow before change in working capital 178 953 154 282 Change in WCR ( 10 011) 11 782 Net cash provided by operating activities 168 942 166 064 Purchases of tangible and intangible fixed assets ( 79 373) ( 110 370)
Slide 25: Other financial indicators
Other financial indicators Careful management of resources Key figures 2012 2011 2010 Regulated WACC (weighted average cost of capital) 4.14% 4.25% 4.55% Free cash flow CHF 000 43 418 ( 34 235) ( 31 166) Dividends received from affiliated companies CHF 000 61 571 60 958 61 455 Return on capital empl
Slide 26: RE Holding share price
RE Holding share price Low power prices on wholesale markets and uncertainty over Switzerland's 2050 energy strategy have weighed on sector stocks Source: SIX-Telekurs © ROMANDE ENERGIE www.romande-energie.ch 26
Slide 27: RE Holding share price
RE Holding share price Book value per share higher than market price HREN: Registered share of Romande Energie Holding SA © ROMANDE ENERGIE www.romande-energie.ch 27
Slide 28: 2012 dividend
2012 dividend Solid operating results enable increased dividend of CHF 27 Rate of distribution (EBITDA) © ROMANDE ENERGIE www.romande-energie.ch 28
Slide 29: 2012 dividend: dividend yield per share
2012 dividend Dividend yield per share © ROMANDE ENERGIE www.romande-energie.ch 29
Slide 30: Core shareholders (March 2013)
Core shareholders (March 2013) Romande Energie Holding SA © ROMANDE ENERGIE www.romande-energie.ch 30
Slide 31: Financial Calendar 2013
Financial Calendar 2013 • 26 March Publication of 2012 annual results • 27 March Analysts/investors presentation of 2012 results in Zurich • 26 April Publication of the 2012 annual report (French only) • 17 May Share register cut-off date • 27 May Annual General Meeting in Morges • 29 May Ex dividen
Slide 32: 3. Challenges and outlook
1. Romande Energie in 2012 2. Financial results 3. Challenges and outlook 4. Questions © ROMANDE ENERGIE www.romande-energie.ch 32
Slide 33: Challenges: European market in throes of change
Challenges European market in throes of change • The economic crisis has led to a sharp drop in demand for power across Europe • Concurrently we have seen the rapid expansion of renewable power generation (chiefly wind and solar) in Europe, driven by sharp increase in government incentives • This ha
Slide 34: Challenges: European market in throes of change
Challenges European market in throes of change © ROMANDE ENERGIE www.romande-energie.ch 34
Slide 35: Switzerland: Energy Strategy 2050
Challenges Switzerland: Energy Strategy 2050 The Federal Council's 2050 Energy Strategy plans for a phase-out of nuclear power (40% of current power generation in Switzerland) through: • energy efficiency • renewable energy sources • electricity imports • use of natural-gas-fired power plants and he
Slide 36: Switzerland: Energy Strategy 2050
Challenges Switzerland: Energy Strategy 2050 Ambitious strategy but several questions unanswered • Would the climate come under threat due to over-reliance on fossil fuels instead of nuclear power? • Will renewable energy sources suffice to cover all our needs? What are the incentives? How competiti
Slide 37: Switzerland: Energy Strategy 2050 – Official position
Challenges Switzerland: Energy Strategy 2050 Official position of Romande Energie: • We support the Strategy's principles though we are aware of the challenge that this represents and the fact that rules of implementation still must be defined/revised • The Federal vision is in line with the corpora
Slide 38: Challenges: Full market liberalization
Challenges Full market liberalization • On 1 January 2015 ? • Severe pressure from European Union • Unfettered competition based chiefly on pricing. But prices are currently distorted by massive renewable-energy subsidies in some countries, most notably in Germany • Romande Energie is still in favou
Slide 39: Challenges: Changes at cantonal level
Challenges Changes at cantonal level as well • Revision of Vaud Cantonal Energy Act entered consultation phase in 2012. Changes will shortly be debated in cantonal parliament. Reforms planned: • Various measures to ensure rationale use of energy, mainly in construction • Electric heating installatio
Slide 40: Ensuring supply
From standpoint of Romande Energie Ensuring supply • Plans to expand own-power production to limit our dependence on the energy market and exert greater control over costs and prices • Two additional avenues: • production projects based on new renewable energies (project portfolio worth CHF 590 mill
Slide 41: Reducing energy consumption
From standpoint of Romande Energie Reducing energy consumption • Increase and diversify existing efforts that promote energy efficiency • Two avenues: o Technological solutions: Heat pumps Solar-thermal Company and household audits Energy performance certificates o Raising awareness: "Déclic
Slide 42: Maintain and upgrade grids
From standpoint of Romande Energie Maintain and upgrade grids • Continued investments to maintain and modernize grid (approx. CHF 50 million/year) • Rollout of optical fibre. By the end of 2015, most densely population regions will be equipped. By 2030, 80% of customer base will be equipped • Asset
Slide 43: Refine customer focus
From standpoint of Romande Energie Refine customer focus • Internal program for ongoing improvement in customer focus in all departments: "REflexes" • Designing new product and service ranges that meet changing needs among customers • Work on processes and cost centres with the aim of maintaining pr
Slide 44: 4. Questions
1. Romande Energie in 2012 2. Financial results 3. Outlook and commitments 4. Questions © ROMANDE ENERGIE www.romande-energie.ch 44
Slide 45: Thank you for listening
Thank you for listening We will be pleased to take any questions you may have Pierre-Alain Urech Denis Matthey CEO CFO pierre-alain.urech@romande-energie.ch denis.matthey@romande-energie.ch +41 (0)21 802 97 00 +41 (0)21 802 97 05 © ROMANDE ENERGIE www.romande-energie.ch 44
Slide 46: Contact: Media Relations
Contact Romande Energie Holding SA Rue de Lausanne 53 Case postale CH-1110 Morges 1 Media Relations Karin Devalte, Head of Communications Phone: +41 (0)21 802 95 67 Fax: +41 (0)21 802 97 11 E-Mail: karin.devalte@romande-energie.ch © ROMANDE ENERGIE www.romande-energie.ch 45
Slide 47: Contact: Investor Relations
Contact Romande Energie Holding SA Rue de Lausanne 53 Case postale CH-1110 Morges 1 Investor Relations René Lauckner, Treasurer Phone: +41 (0)21 802 95 24 Fax: +41 (0)21 802 95 18 E-Mail: rene.lauckner@romande-energie.ch © ROMANDE ENERGIE www.romande-energie.ch 47
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