7c Solarparken Ag · XETR:HRPK

7c Solarparken — Investor Presentation (May 2018)

36 slides from 7c Solarparken's investor presentation, May 2018

  1. Slide 1: Investor Presentation Q2 2018

    INVESTOR PRESENTATION Q2 2018 © 7C Solarparken AG 2018 www.solarparken.com MAY 2018 1

  2. Slide 2: Equity Story

    INVESTOR PRESENTATION Q2 2018 EQUITY STORY 2

  3. Slide 3: Long-term cash flows, growth and first-time dividend

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK LONG-TERM CASH FLOWS, GROWTH AND FIRST-TIME DIVIDEND Pure-play owner-operator of PV parks of 134 MWp in Germany Stable cash flows through guaranteed fixed feed-in tariffs for 20 years Optimisation and PV Estate drive long-term value Growth pl

  4. Slide 4: Business

    INVESTOR PRESENTATION Q2 2018 BUSINESS 4

  5. Slide 5: Pure-play PV owner-operator in Germany

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK PURE-PLAY PV OWNER-OPERATOR IN GERMANY 1 2 3 4 Asset investment Optimisation Operations PV Estate COMMITMENT FOR VALUE CREATION THROUGHOUT THE PROJECT’S LIFECYCLE 5

  6. Slide 6: USP 1: We continue to expand our IPP portfolio

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK USP 1: WE CONTINUE TO EXPAND OUR IPP PORTFOLIO OF GERMAN PV PARKS PORTFOLIO GROWTH IN MWP 150 140 16 134 130 18 120 110 14 100 90 15 80 71 70 60 50 40 30 20 10 - 2014 2015 2016 2017 2018 YTD RECURRING GROWTH OF ~15 MW PER YEAR IN THE PERIOD 2

  7. Slide 7: USP 2: Acquisition of Amatec's development business

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK USP 2: THE ACQUISITION OF AMATEC’S DEVELOPMENT BUSINESS ENABLES A NEW GROWTH CHANNEL Sourcing of investments: New-build development New-build turnkey Operating asset acquisition - Land identification - Due diligence - Due diligence 12-18 Mont

  8. Slide 8: USP 3: We optimise parks

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK USP 3: WE OPTIMISE PARKS OVERVIEW OPTIMISATION PLANS WITH RECURRING ANNUAL EBITDA GAIN 2014-18 IN EUR MIO 1,26 0,70 0,36 0,18 0,10 0,07 Plan 2014-16 "Colexon IPP" optimisation Plan 2015-17 "Miskina" optim Plan 2016-18 "Optim 2.0" Investment ∆

  9. Slide 9: USP 4: We operate the parks at high performance ratio

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK USP 4: WE OPERATE THE PARKS AT HIGH PERFORMANCE RATIO OVERVIEW PERFORMANCE RATIO 2017 OF ALL INSTALLATIONS kWh/kWp (relative output yield) PR = kWh/m² (irradiation on the panel) 95% AVERAGE PR  Weighted average Performance Ratio > 80% 90% 

  10. Slide 10: USP 5: We buy PV Estate to secure long-term value

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK USP 5: WE BUY PV ESTATE TO SECURE LONG-TERM VALUE GRAFENTRAUBACH: Building PV ESTATE PORTFOLIO PROJECT ESTATE REGION SIZE IN HA CAPACITY Sandersdorf Land Sachsen Anhalt 9,3 5.1 MWp Zerre Land Sachsen 28,5 8.0 MWp Hausen Building Bayern n.r. 0

  11. Slide 11: Company

    INVESTOR PRESENTATION Q2 2018 COMPANY 11

  12. Slide 12: IPP portfolio of 134 MWp generates annual EBITDA of approx EUR 31 Mio

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK IPP PORTFOLIO OF 134 MWP GENERATES ANNUAL EBITDA OF APPROX EUR 31 MIO CAPACITY TARIFF YIELD (*) REVENUES (*) EBITDA (*) Unit MWp EUR/MWh kWh/kWp EUR Mio EUR Mio Freefield 77 264 1.019 20,6 18,4 Rooftop 57 294 890 14,9 12,6 IPP PORTFOLIO 134 2

  13. Slide 13: Why we like Germany

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK WHY WE LIKE GERMANY Stable government, stable regulation Respect for capital Transparent and competitive power markets The heart of European energy flows Lowest government bond yields Largest PV market in Europe > 43 GWp 13

  14. Slide 14: Management track-record

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK MANAGEMENT TRACK-RECORD 2018 GROWTH TO 150 MWP THROUGH ALTERNATIVE FINANCING 135 2016-17 GROWTH TO 115 MWP THROUGH PRIVATE 125 PLACEMENTS 2015-16 ACQUISITION & 115 OPTIMISATION MISKINA (14 MWP) 105 2014-15 95 ACQUISITION & OPTIMISATION COLEXO

  15. Slide 15: Shareholders structure

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK SHAREHOLDERS STRUCTURE Sufina Comm VA; Axxion S.A.; 3,4% Share 7C Solarparken AG 4,2% XIX-Invest NV ISIN DE000A11QW68 5,0% WKN A11QW6 DVP Invest BVBA; 5,1% Ticker HRPK # shares 46,8 Mio Steven De Proost; Standard General Standard 5,4% Trading

  16. Slide 16: Strategy

    INVESTOR PRESENTATION Q2 2018 STRATEGY 16

  17. Slide 17: Market observation: competitiveness of solar power

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK MARKET OBSERVATION COMPETITIVENESS OF SOLAR POWER TREND OF FEED-IN TARIFFS FOR NEW-BUILD 2000-17 COST TO BUILD A NEW 100 KWP PV PLANT (IN EUR/KWP) 6.000 Modules 5.000 BOS incl. Inverter 4.000 3.000 2.000 1.000 -  Tariffs have reduced from ov

  18. Slide 18: Freefield solar power seen as the cheapest

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK MARKET OBSERVATION COMPETITIVENESS OF SOLAR POWER LEVELISED COST OF NEW-BUILD ELECTRICITY (EUR/MWH) WHOLESALE POWER PRICE DEVELOPMENT (EUR/MWH) 100 90 80 70 60 50 40 30 20 EEX base-load Auction price PV 10 - Source: Fraunhofer Institute, Marc

  19. Slide 19: M&A will dominate the renewables market

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK MARKET OBSERVATION M&A WILL DOMINATE THE RENEWABLES MARKET IRR of new-build plants Valuation of portfolios Size of new-build projects Technical regulations M&A to drive growth and extract synergies Highly fragmented PV market in Germany 1/3 o

  20. Slide 20: 200 MWp seen as critical point for improved valuation

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK MARKET OBSERVATION VALUATION DISCOUNT FOR OPERATORS BELOW 200 MW TIER 1 > 500 MW TIER 2 > 200 MW  Regular secondary offerings  Regular secondary offerings  International institutions  Local institutional investors  Market cap/MW ~ 1,2x 

  21. Slide 21: Plan 2017-19: grow to 200 MW in two stages

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK PLAN 2017-19 7C SOLARPARKEN AIMS TO GROW TO 200 MW IN TWO STAGES UPDATE 23.04.2018 The 150 MW target for 2018-19 is now set for year-end 2018 FOUNDATIONS FOR STRATEGIC DEAL #1 SECURED THROUGH AMATEC AND THE SCHULDSCHEIN 21

  22. Slide 22: Strategic deal #1: acquisition of Amatec's development business

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK STRATEGIC DEAL #1 ACQUISITION OF AMATEC’S DEVELOPMENT BUSINESS EARLY STAGE LOCATION OF DEVELOPMENT PROJECTS FINISHED PROJECT OPPORTUNITIES > 40 MW 12-18 Months DEVELOPMENT & READY TO BUILD (< 750 KW) 15 MW  Mühlheim (Nordrhein Westfalen)  0

  23. Slide 23: Strategic deal #1: alternative financing of EUR 25 Mio

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK STRATEGIC DEAL #1 ALTERNATIVE FINANCING OF EUR 25 MIO. • Issue of EUR 25 Mio Promissory Notes (“Schuldschein”) at 7C Solarparken AG level at the end of Feb ‘18 SUMMARY • Unsecured bullet loan with maturity of five and seven years • Fixed and

  24. Slide 24: Financials

    INVESTOR PRESENTATION Q2 2018 FINANCIALS 24

  25. Slide 25: Improved financial profile since change of management in 2014

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK IMPROVED FINANCIAL PROFILE SINCE CHANGE OF MANAGEMENT IN 2014 30,0 RETURN ON ASSETS 12,0% COVERAGE RATIO 25,0 10,0% 6,0 5,0 9,6% 5,0 20,0 8,9% 8,0% 3,8 7,6% 4,0 15,0 5,4% 6,0% 3,4 3,4 27,5 25,3 3,0 10,0 20,2 4,0% 2,6 2,0 2,5 2,2 11,2 1,7 5,0

  26. Slide 26: IPP portfolio: operational performance 2017

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK IPP PORTFOLIO: OPERATIONAL PERFORMANCE 2017 961 982 102,5 104,4 +15% 390 372 359 337 88,9 92,5 131 157 100 98 2016 2017 Q1 Q2 Q3 Q4 Year GWh MWp weighted kWh/kWp 2016 kWh/kWp 2017  7C Solarparken produced 102,5 GWh in 2017 (prognosis: 101,9

  27. Slide 27: Group P&L (IFRS)

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK GROUP P&L (IFRS) In T EUR 2017 2016 Comment Revenues 32.988 30.294 EUR 32,6 Mio from IPP in 2017 (average tariff: EUR 318/MWh) EBITDA 29.864 27.949 including positive one-time effects D&A - 17.287 - 15.956 Reflects increase in underlying asse

  28. Slide 28: Clean EBITDA and cash flow per share

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK CLEAN EBITDA AND CASH FLOW PER SHARE In Mio EUR 2017 2016 Comment EBITDA 29,9 27,9 Including one-time effects Transaction & restructuring expenses 1,0 0,2 Compensation for damage -1,6 0,0 Incl. settlement with equipment supplier resulting fro

  29. Slide 29: Group balance sheet (IFRS)

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK GROUP BALANCE SHEET (IFRS) In T EUR 2017 2016 Comment ASSETS 294.438 285.063 Land & Property 8.183 7.889 PV Estate Solarparks 240.517 233.937 Solar installations incl under construction Financial investment 31 183 Inventory 1.637 408 mainly m

  30. Slide 30: Provisions and old legacy Colexon

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK PROVISIONS AND OLD LEGACY COLEXON In T EUR 2017 2016 Comment LONG TERM PROVISIONS 8.507 7.744 Rückbau 6.330 5.443 Normal dismantling provisions Technical warranties 1.429 1.463 EPC risks O&M contracts 14 98 Unprofitable O&M contracts Continge

  31. Slide 31: First-time dividend EUR 0,10 per share

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK FIRST-TIME DIVIDEND EUR 0,10/PER SHARE Date Presentation Title Management statement 08.Sep.2015 Plan 2015-17 Capital appreciation through consolidation “towards a highly attractive dividend or dividend equivalent of EUR 0,10/share over 2017”

  32. Slide 32: Outlook

    INVESTOR PRESENTATION Q2 2018 OUTLOOK 32

  33. Slide 33: Planned capacity growth during 2018 towards 150 MWp

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK PLANNED CAPACITY GROWTH DURING 2018 TOWARDS 150 MWP 10 150 150 6 140 16 130 MANAGEMENT ASSUMPTION 120 118 The planned capacity built up in Q3’18 (+ 6MWp) and Q4’18 (+ 10MWp) will 110 not contribute to EBITDA in 2018 100 90 80 70 60 50 Year-en

  34. Slide 34: EBITDA bridge 2017-18

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK EBITDA (EUR MIO) BRIDGE 2017-18 AND SHOWCASE 150 MWP 34,0 32,0 ASSUMPTIONS 2,4 32,0 0,5 0,5 0,6  We fully reflect the weak Q1’18 performance. The 1,7 29,6 30,0 0,5 production yield in March ’18 suffered from below- 28,2 0,7 0,2 average irrad

  35. Slide 35: Cash flow prognosis for 2018

    EQUITY STORY BUSINESS COMPANY STRATEGY FINANCIALS OUTLOOK CASH FLOW (EUR MIO) PROGNOSIS FOR 2018 35,0 29,6 MANAGEMENT COMMENT: 30,0 2018 is a cornerstone year from strategic point, but both strategic 25,0 22,8 transactions will limit the net cash flow generation in its first year due to: 5,8 0,3 0,7

  36. Slide 36: Contact

    INVESTOR PRESENTATION Q2 2018 7C SOLARPARKEN AG An der Feuerwache 15 - 95445 Bayreuth Steven De Proost, CEO [email protected] +49 (0) 921 230 557 77 CONTACT 36

7C Solarparken — Investor Presentation (May 2018) on 6ix