half-year results 2017 - total direct energie · 2017. 9. 28. · customer portfolio 2.3 million...
TRANSCRIPT
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HALF-YEAR RESULTS 201728 september 2017
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2H1 2017 results
Structure of the French market
Competition CompetitionRegulated
Leading French alternativeon the energy supply market
Third largest French electricity and gas supplierAlso active in Belgium
Createdin 1946
Createdin 1946
Createdin 2002
Production Transmissionon
Supply
Regulated
Distribution
A KEY PLAYER IN THE FRENCH ENERGY MARKET
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Customer portfolio
2.3 million
Revenue
€1.0 billionCurrent op. income
€53 M
H1 2017 results 3
Gross customeracquisitions in France
437,000
425 EmployeesOf which 65 in generation
Generation capacities
1,200 MWOf which 800 MW in operation
Quadran Acquisition
800 MW installed capacity end of 2018200 employees (HQ in Béziers)
v
HALF YEAR KEY FIGURES
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4
- CONTINUING BUSINESS GROWTH:- 390,000 residential sites (gross) acquired over the period +43% (vs 30/06/16)- 2,311,000 sites in portfolio as at 30 June 2017
- IMPROVED FINANCIAL INDICATORS (vs 30/06/2016):- Revenue €1,006.1m +17%- Gross margin €148.4m +39%- EBITDA €69.7m +18%- Current operating income €52.6m +20%
- QUADRAN ACQUISITION:- Signing of the share purchase agreement at the end of July- Transaction still due to be finalised in Q4 2017
- CHANGE IN SHARE CAPITAL:- Successful capital increase (€130m)
H1 2017 results
A WELL ORIENTATED FIRST HALF
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Impala SAS33,0%
AMS Industries18,6%
Lov GroupInvest5,55%
EBM Trirhena AG9,3%
Luxempart9,6%
Management5,6%
Free float17,7%
Change in capital, increaseof free float
5
Capital increase completed successfully in July 2017:- ABB format which raised €130m (extension
clause exercised)- Placement of 2.6m new shares priced at €49.50
per share, or 6.3% of the pre-transaction capital- Participation of core shareholders and
management
Share performance (Jan-Aug 2017):- +37.5%- Capitalisation: €2.2bn
H1 2017 results
SHAREHOLDERS AND SHARE PERFORMANCE
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ACHIEVEMENTS AND KEY EVENTS
6
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392456
522
1,4431,608
1,789
June 2017Dec 2016June 2016
1,1111,274
1,429
108
103
114
Residential
Customer sites in electricity (in thousands)
219
226
246
June 2017 Dec 2016June 2016
370
431
497Professional
Major accounts
H1 2015 H1 2016 H1 2017 H1 17 vs H1 16
Electricity volumes sold 3.7 TWh 7.1 TWh 8.1 TWh ↗ +14%
Gas volumes sold 2.2 TWh 2.9 TWh 3.8 TWh ↗ +30%
H1 2017 results7
Customer sites in gas(in thousands)
BALANCED DEVELOPMENT OF THE CUSTOMER PORTFOLIO IN FRANCE
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Gross acquisition of customer sites(in thousands)
874
1,111
1,429
370
497
281
H1 2015 H1 2016 H1 2017
1,115
1,481
1,926
205
273
390
H1 2017H1 2016H1 2015
154
52
103
200
73Electricity
Number of customer sites (in thousands)
↗ 33%
↗ 43%
Gas287
With still-significant growth potential in the domestic market
- 32.2m residential sites- 87% at regulated tariff
- 11.3m sites- 50% at regulated tariff
H1 2017 results8
Source: CRE
RESIDENTIAL SEGMENT: ACCELERATION OF THE ACQUISITIONS
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Gross acquisition of customer sites (in thousands)
102
227
258
117127
H1 2015 H1 2016 H1 2017
228
344
385
24
103
48
H1 2017H1 2016H1 2015
11
1785
18Major accounts
Number of customer sites(in thousands)
SME’s
3113
126
- The “yellow” and “green” tariffs were terminated in 2016, which explains theexceptional high acquisition rate during the period
- Historical reference which should not mask the continued recruitments in theMajor Accounts segment
H1 2017 results9
CONTINUED MOMENTUM ON THE NON- RESIDENTIAL SEGMENT
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10
Approval by the EuropeanCommission of the annualcapacity premium to be paidon the proposed gas-firedplant in Brittany (Landivisiau).
Construction due to start in2018, subject to resolution ofthe appeals filed.
Introduction of a capacitymechanism on 1 January 2017.
Suppliers to hold certificatescommensurate with therequirements of their customerportfolio.
Certificates obtained by powergenerators subject to availability.
First auction at a price of around€10k/MW.
Approval by the Council ofState of the principle wherebythe distribution systemoperator compensates thesupplier for customermanagement costs.
The French Energy RegulatoryCommission (CRE) hasaddressed the issue, andpublished deliberationscurrently being assessed.
H1 2017 results
A CHANGING REGULATORY ENVIRONMENT
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11
- Council of State decision of 19 July 2017 confirming thatregulated gas tariffs are incompatible with European law
- Appeal filed against regulated electricity tariffs
H1 2017 results
… and also at a national level
European pressure …
- Clean Energy Package
- End of regulated electricity tariffs in all Member Statesproposed by 2020
Schedule and details uncertain (2020?)Significant acquisition opportunities
FORCASTED TERMINATION OF THE REGULATED TARIFFS
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12
- Favourable market conditions for thermal plants- Validation of the vertical integration strategy
H1 2017 results
Bayet (400 MW) Marcinelle (400 MW)
H1 2016 H1 2017 S1 2017
Running hours 1,407 2,123 2,098
Production 469 GWh 728 GWh 760 GWh
ACHIEVEMENTS OF THE GENERATION SEGMENT
Source Epex spot,Ice,Powernext,
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Biogas
Wind
Solar
Hydro
KEY FIGURES
- Signing of the SPA in late July (acquisition price: €303m + €113m earnout)- Financing fully secured (bank borrowing + capital increase)- Finalisation still scheduled for Q4 2017
PROGRESS REVIEW
H1 2017 results13
> 360 MW: gross capacity installed as of 31/12/2016
> 450 MW: new projects to be operational by 2018?gross capacities raised over 800 MW
> 2.000 MW: pipeline under study and development
QUADRAN: KEY ACQUISITION IN THE PROCESS OF BEING FINALIZED
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PRESENTATION OF 2017 HALF-YEARLY FINANCIAL STATEMENTS
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- SUSTAINED BUSINESS GROWTH...• Strong business momentum, especially in the residential segment, leading to an increase in energy
volumes sold• Contribution of production assets (recorded under energy management margin)
- ...CONTRIBUTING TO THE DYNAMIC INCREASE IN GROSS MARGIN• 15% organic growth after restatement of non-recurring items from H1 2016 (provision for gas transit
capacity, expiry of the Enedis service agreement on 30 September 2016) and despite the decrease inregulated electricity tariffs on 1 August 2016
• First-time consolidation of Marcinelle Energie and increase in margins captured by the Bayet plant
- AND TRANSLATING IN A 20% INCREASE IN COI• Controlled personnel expenses across the entire scope of consolidation• Impact on H1 2016 of GRDF's coverage of unpaid gas distribution costs prior to 2016 (€10m)
15H1 2017 results
€mH1 2017 H1 2016 Change
Revenue from ordinary activities 1,006.1 863.6 +16.5%
Gross margin 148.4 107.1 +38.6%
EBITDA 69.7 59.3 +17.5%
Current operating income 52.6 43.8 +20.1%
CONTINUED GROWTH
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80,0
90,0
100,0
110,0
120,0
130,0
140,0
150,0
160,0
16
107.1
33.0
148.4
8.1 Organic growth
Gross margin H1 2016
Gross margin H1 2017
Termination of the Enedis
service agreementNeutralisation
of transit capacity
provision H1 2016
Additional 2016
retroactive tariff
adjustment
Marcinelle contribution
2.9
(21.7)
+€41.3m (+38%)
19.0
In €m
H1 2017 results
DYNAMIC INCREASE IN GROSS MARGIN
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€mH1 2017 H1 2016
Current operating income 52.6 43.8 Changes in fair value of Energy financial derivative instruments operational in nature
(20.8) (16.8)
Impairment and disposals of non-current assets 0.0 (0.1)
Operating income 31.8 26.9 Financial income / (loss) (6.5) (5.4)
Corporate income tax (8.5) 30.5
Share of net income from equity-accounted companies 0.1 0.3
Net income 17.0 52.4
17H1 2017 results
- FINANCIAL INSTRUMENTS:• Consequence of the delivery of forward products (power), which had a positive fair value at 31/12/2016
- INCREASE IN INTEREST EXPENSES• New €68m bond in November 2016 and setup of funding lines for the Quadran acquisition
- CHANGE IN DEFERRED TAX• Negative change in deferred tax in H1 2017 (-€5.5m, mainly impacted by the use of tax losses carried forward), whereas
the Group had recognised deferred tax income of €34.5m in H1 2016 (mainly from the capitalisation of tax lossescarried forward in view of projected future earnings)
NET RESULT IMPACTED BY NON-RECURRING ITEMS
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- DECREASE IN CURRENT ASSETS AND LIABILITIES:• Current assets: decrease in cash due to the usual seasonal change in WCR and the anticipated repayment of the
margin calls received• Current liabilities: decrease in trade payables (seasonality effect) and margin calls received (delivery of energy
purchaseswith an important positive fair value at the end of 2016)
- EQUITY RELATIVELY STABLE BEFORE FAIR VALUE IMPACT:• Earnings growth offset by the impact of dividend payouts and share buybacks
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€m 30/06/2017 31/12/2016
Non-current assets 220.7 223.2
Current assets 757.4 1,006.3
of which cash and cash equivalents 194.9 368.9
TOTAL ASSETS 978.1 1,229.5
Shareholders' Equity excluding fair value of derivative hedging instruments 207.2 203.9
Fair value of derivative hedging instruments (4.1) 13.6
Shareholders' equity 203.1 217.5
Non-current liabilities 244.0 255.6
Current liabilities 531.0 756.4
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 978.1 1,229.5
H1 2017 results
SEASONALITY EFFECTS ON THE BALANCE SHEET
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Opening cash position at 31/12/2016
Cash flow generation Change in WCR
Investment cash flows
Closing cash position at 30/06/2017
Financing cash flows
0
100
200
300
400
64.4
- CASH POSITION REMAINS SOLID AT €192.3M• Customary cyclical increase in WCR due to the combined effect of the seasonal nature of the business
(reduction in trade payables of approximately €84m) and the impact of early “market unwinding” in 2016repayed in 2017 (around€33m)
• Investment cash flows which partly reflect the cash collateral repaid to counterparties (around €69m),mainly due to the delivery of energy purchases with an important positive fair value at the end of 2016
(In €m)
232.4
75.6(122.5)
(109.4)
(16.2)
127.9
19H1 2017 results
Deposits and margin calls received Deposits and margin
calls received
132.5
364.9
192.3
ANALYSIS OF THE CHANGE IN CONSOLIDATED CASH FLOW
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20H1 2017 results
- NET FINANCIAL DEBT• €57.1m versus €(43.6)m at 31/12/2016, a direct result of the seasonal
increase in WCR
• Financial flexibility supported by €192.3m in available cash and €245m inunused authorised lines
- QUADRAN PROJECT: DEDICATED FINANCING• €230m: set up of a 5-year unsecured term loan• €120m: refinancing of the existing RCF
• Operating credit lines to support growth (€125m: factor + clearer)• Bondholders approval of the new acquisition financing package (€183m)
NET DEBT STILL CONTAINED
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2017 ANNUAL
TARGETS
21
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Customer portfolio increased to 2.5
million sites€2,000k €100mCOMMUNICATED TARGETS
22
Customer portfolio
Revenueat normal temperatures
Operating current income
at normal temperatures
- First-half results confirm that all annual targets for 2017 will be reached
- Projected ROC of €100m implies an EBITDA of around €135m
- As a reminder, the 2016 annual financial statements benefited from positive regulatory impacts of€21.7m
- Minor contribution expected from Quadran due to the closing date (Q4 2017)
H1 2017 results
CONFIRMATION OF 2017 TARGETS
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Q&A
23
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APPENDICES
24
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PROFIT & LOSS ACCOUNT
25H1 2017 results
In thousands of euros 30/06/2017 30/06/2016
Revenue excluding Energy Management 970,174 859,008 Energy Management Margin 35,885 4,557
Revenue from ordinary activities 1,006,059 863,565
Cost of sales (857,648) (756,490)
Gross margin 148,412 107,075
Personnel expenses (19,251) (17,167) Other operating income and expenses (60,861) (31,506) Depreciation and amortisation (15,681) (14,575)
Current operating income 52,619 43,826
Changes in fair value of Energy financial derivative instruments operational in nature(20,800) (16,781)
Disposals of non-current assets 2 (11) Impairment of non-current assets 0 (112) Income and expenses related to changes in scope of consolidation - -
Operating income 31,820 26,923
Cost of net debt (6,207) (5,237) Other financial income and expenses (293) (138)
Financial income / (loss) (6,500) (5,375)
Corporate income tax (8,503) 30,533 Share of net income from companies accounted for by the equity method 135 332
Net income from continuing operations 16,953 52,414
Net income from discontinued operations - -
Net income 16,953 52,414
of which Net income, Group share 16,953 52,414 Earnings per share (in euros) 0.41 1.28 Diluted earnings per share (in euros) 0.39 1.21
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BALANCE SHEET ASSETS
26H1 2017 results
In thousands of euros 30/06/2017 31/12/2016
Intangible assets 59,241 50,170
Property, plant and equipment 82,363 76,217
Investments in associates 1,648 1,434
Non-current derivative financial instruments 11,769 19,334
Other non-current financial assets 2,221 1,342
Other non-current assets 5,924 8,210
Deferred tax assets 57,554 66,467
Non-current assets 220,720 223,173
Inventory 42,696 38,458
Trade receivables 406,956 413,279
Current derivative financial instruments 53,972 137,084
Other current financial assets 21,390 18,364
Other current assets 37,492 30,263
Cash and cash equivalents 194,884 368,867
Current assets 757,389 1,006,314
TOTAL ASSETS 978,109 1,229,487
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BALANCE SHEET LIABILITIES
27H1 2017 results
In thousands of euros 30/06/2017 31/12/2016
Share capital and share premiums 19,538 15,307
Retained earnings and net income / (loss) 196,706 188,769
Treasury shares (9,044) (207)
Other comprehensive income (4,134) 13,630
Shareholders' Equity - Group share 203,066 217,499
Shareholders' equity 203,066 217,499
Non-current provisions 34,014 37,658
Non-current derivative financial instruments 20,568 17,311
Other non-current financial liabilities 183,736 182,843
Other non-current liabilities 5,349 4,759
Deferred tax liabilities 367 13,065
Non-current liabilities 244,033 255,637
Current provisions 14,944 14,169
Trade payables 158,751 242,602
Current derivative financial instruments 63,564 103,925
Other current financial liabilities 73,746 145,689
Other current liabilities 220,004 249,966
Current liabilities 531,010 756,351
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 978,109 1,229,487
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CASHFLOW TABLE
28H1 2017 results
In thousands of euros 30/06/2017 30/06/2016
Consolidated net income 16,953 52,414 Tax expenses/income 8,503 (30,533) Financial income / (loss) 6,500 5,375
Income before taxes and financial expenses 31,955 27,255
Depreciation and amortisation 15,681 14,575 Impairments - 112 Provisions and depreciations 4,731 31,446 Expenses related to share-based payments 1,359 862 Change in fair value of financial instruments 26,482 16,781 Other financial items with no cash impact (294) 11 Share of income from associates (135) (332)
Items with no cash impact 47,823 63,456
Income tax paid (4,213) -Change in working capital requirement (122,509) (4,248)
Net cash flow from operating activities (46,944) 86,463
Acquisition of fixed assets (30,519) (16,502) Disposals of fixed assets 2 -Change in deposits and guarantees (68,734) 35,644 Net change in loans granted by the Company (10,177) 3,356
Net cash flows from investing activities (109,430) 22,497
Sums received from shareholders during capital increases 4,232 3,190 Treasury shares (8,805) 36 Proceeds from borrowings 2,159 117,494 Repayment of borrowings (1,104) (60,870) Interest paid (2,391) (2,975) Interest received 150 657 Dividends paid (10,407) (8,242)
Net cash flows used in financing activities (16,166) 49,291
Net change in cash and cash equivalents (172,540) 158,250
Cash and cash equivalents at beginning of year 364,837 31,993 Cash and cash equivalents at end of year 192,298 190,243