Voltalia SA: 2019 second half rebound, as expected - Long-term visibility and growth secured with over EUR 5 billion of future revenues under contracts

Voltalia SA 
Voltalia SA: 2019 second half rebound, as expected - Long-term visibility 
and growth secured with over EUR 5 billion of future revenues under 
contracts 
 
23-March-2020 / 07:30 CET/CEST 
Dissemination of a French Regulatory News, transmitted by EQS Group. 
The issuer is solely responsible for the content of this announcement. 
 
Sound FY 2019 performance compared to FY 2018, which integrated 
non-recurring items 
 
  · Energy sales EBITDA down by EUR 10 million: installed capacity 
  expansion and diversification mitigated the EUR 20 million impact of 
  2018's non-recurring price hikes in Brazil 
 
  · Services confirmed as a sustainable contributor to EBITDA and value 
  creation 
 
  · Group net profit at EUR 4.6 million, with Group net profit reaching 
  EUR 13.3 million in the second half 
 
  · Solid balance sheet with more than EUR 400 million cash available[1] 
 
2020 objectives maintained in a less predictable environment due to the 
Covid-19 situation 
 
  · Monitoring impacts of the Covid-19 outbreak on activity, with a strong 
  priority given to employees' health 
 
  · 1 GW and EUR 160-180 million EBITDA objectives maintained 
 
  · Plants currently in operation and construction will bring, once fully 
  built, EUR 180 million of EBITDA per year 
 
2023 roadmap already well underway and fully financed 
 
  · 2.6 GW capacity ambition in 2023: 73% secured thanks to long-term power 
  sales contracts won since January 2019 
 
  · The required equity is fully financed by the 2019 capital increase 
 
Revenues long-term visibility and contained leverage remain key features of 
the Voltalia model 
 
  · EUR 5 billion of contracted future revenues representing over 20 years 
  of future cash flows from strong counterparties 
 
  · Pipeline of 7.8 GW, up by 28% compared with FY 2018, to be kept or sold 
  with Services 
 
  · Low gearing[2] (46%) and very disciplined approach to financing offers 
  strong financial flexibility 
 
  Voltalia (Euronext Paris ISIN code: FR0011995588), international player in 
            renewable energies, announces today its FY 2019 results[3]. 
 
         Volltalia will comment on its FY 2019 results and short to mid-term 
 perspectives during a live webcast starting at 9.00 AM Paris time on Monday 
            23, 2020. All connection details are available on our website: 
            https://www.voltalia.com/uk/investors [1]. 
 
   "2019 is another year where the Voltalia model has proven its robustness. 
  Good operational and financial performances during the second half allowed 
  another year of positive net profit. As the Covid-19 outbreak is putting a 
   lot of stress on people and economy around the world, we belong to a very 
     resilient sector with revenues secured by long-term contracts. Voltalia 
 benefits from over EUR 5 billion of contracted future revenues, one of the 
  best levels in the industry given its size. Voltalia's strength also comes 
   from its strategy to focus on competitive, non-subsidized power projects, 
    its integrated model and its cautious, low-leverage financial policy. In 
          addition to presenting challenges, the Covid-19 crisis will create 
        opportunities that can be seized by strong players such as Voltalia" 
             comments Sébastien Clerc, CEO of Voltalia. 
 
            Key figures 
 
 2019 full year results show a solid and profitable performance, with growth 
  after restatement of the non-recurring price hikes that occurred in Brazil 
            in 2018 (+13% in revenues and +16% in EBITDA). 
 
                                             Change 
In EUR         FY 2019  FY 2018 At actual rates   At constant 
millions                                              rates 
 
Revenue          175.5    180.7       -2.9%           -1.5% 
EBITDA            65.1    76.2       -14.6%          -12.3% 
EBITDA margin    37.1%    42.2%     -5.1 pts        -4.6 pts 
Net profit        4.6      8.5       -45.7%          -40.5% 
(Group share) 
 
            Business review 
 
   Energy sales: portfolio expansion and diversification compensate the 2019 
            normalisation of pricing in Brazil 
 
With second half revenues and EBITDA outperforming that of the first half by 
        84% and 82% respectively, full-year revenues in 2019 were stable and 
 full-year EBITDA declined by EUR 9 million (-11%) when compared with 2018, 
            at constant exchange rates. 
 
                                          Change 
In EUR        FY 2019 FY 2018      At actual       At constant 
millions                                               rates 
 
                                      rates 
Before 
eliminations 
of services 
provided 
internally 
 
Revenue         129.2   131.7         -1.9%            -0.2% 
EBITDA          77.2    87.9          -12.1%          -10.5% 
EBITDA margin   59.7%   66.7%        -7.0 pts        -6.9 pts 
Production (in  2 117   2 081          +2% 
GWh) 
Installed        678     524           +29% 
capacity (in 
MW, end of 
period) 
 
            Robust performances of existing portfolio 
 
 In 2018, Voltalia added EUR 25 million and EUR 20 million of revenues and 
  EBITDA, respectively, thanks to a non-recurring opportunity resulting into 
selling price hikes[4]. Restated for this impact, Voltalia records in 2019 a 
 strong double-digit growth in revenues (+23%) and EBITDA (+16%), reflecting 
        overall robust performances across the portfolio and the increase in 
       installed capacity: 154 MW of capacity has been added in 2019, almost 
            entirely during the second semester. 
 
· In Brazil, despite lower wind overall, Voltalia's wind farms capacity 
factors in 2019 reached 49%, four points above the regional average during 
the year, reflecting once more the quality of Voltalia's portfolio. 
 
· In France, utility-scale solar and wind plants capacity factors were 19% 
and 27% respectively, outperforming the observed national averages by five 
and two points respectively. 
 
            Portfolio diversification 
 
   Voltalia's portfolio diversification accelerated in 2019: United-Kingdom, 
 Belgium, Portugal, Italy, Greece and Egypt already represented close to 11% 
of Energy sales (versus less than 3% in 2018). The performance has been good 
overall with revenues multiplied by 4.2 compared with 2018, and first Energy 
     sales in new countries (Egypt, Italy, Spain, Belgium) thanks to organic 
            development and Helexia's acquisition. 
 
            Helexia 
 
     For its first six months within the Group, Helexia recorded very robust 
revenues growth at EUR 14 million driven by expansion in installed capacity 
        (62 MW at year-end 2019 vs. 51 MW upon acquisition) and very dynamic 
Services activities. Commercial efforts (22 new hires since the acquisition) 
            and one-off integration costs weighed temporarily on its EBITDA 
            contribution, at EUR 4 million over the six-month period. 
 
            Services: a sustainable contributor to EBITDA 
 
                                               Change 
In EUR  millions    FY 2019 FY 2018 At actual At constant rates 
 
Before eliminations                    rates 
of services provided 
internally 
 
Revenue               145.6   117.2   +24.2%        +24.1% 
EBITDA                10.0     6.7    +50.0%        +58.4% 
EBITDA margin         6.9%    5.7%   +1.2 pts      +1.6 pts 
 
  At constant exchange rates, Services revenues in 2019 were up 24% on 2018, 
       with a 58% increase in EBITDA. This increase reflected high levels of 
        construction activity for the Group's own assets as well as a strong 
            clients' appetite for projects developed by Voltalia. 
 
· With revenues of EUR 126 million in 2019, the Development, Equipment 
Procurement and Construction business continued its profitable growth as a 
result of (i) higher construction volume for Voltalia's own plants (97 MW 
commissioned and 397 MW under construction at year-end, on three 
continents and five technologies, including Voltalia's largest power 
storage projects), and (ii) record level of sale of project development, 
in Brazil (227 MW of developed wind projects sold to Echoenergia, a 
company controlled by British investor Actis) and in France (sale of 60% 
in a 4.3 MW solar plant repowered immediately prior to the sale, which is 
now deconsolidated). Thanks to this, the Development, Construction & 
Equipment Procurement team generated positive EBITDA while developing a 
large and growing portfolio of future projects (1.7 GW added to the 
pipeline during 2019). 
 
· With revenues of EUR 19 million in 2019, Operation & Maintenance is 
slightly below breakeven, pending higher volume of activity to be derived 
from new business secured since January 2019 from third-party clients and 
from Voltalia's growing portfolio of plants. 
 
As part of Voltalia's value enhancing strategy of internalizing development, 
 construction and maintenance, revenues eliminations were up by 45% on 2018, 
         at EUR 99.3 million, representing, once corporate costs are added, 
 EUR 22.1 million of EBITDA. The increase reflects high volumes of activity 
    in the context of the major growth of generating capacity experienced by 
            Voltalia. 
 
  Other income statement items: positive net profit thanks to dynamic second 
            half 
 
                                               Change 
In EUR  millions    FY 2019 FY 2018 At actual At constant rates 
 
                                       rates 
EBITDA before         87.2    94.6     -7.8%         -5.7% 
eliminations and 
corporate 
Eliminations and      -22.1   -18.3   +20.6%        +22.0% 
corporate 
EBITDA                65.1    76.2    -14.6%        -12.3% 
Depreciation,         -29.0   -29.1    -0.3%         +1.8% 
amortisation, and 
provisions 
Other financial       -0.5     0.1      n/a           n/a 
income and expenses 
Operating revenue     35.6    47.2    -24.6%        -22.3% 
(EBIT) 

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