eneva corporate presentation ? may 2014
Post on 02-May-2017
217 Views
Preview:
TRANSCRIPT
May, 2014
Investment Thesis
1
Investment Thesis
One of the largest private sector power generators in Brazil
ENEVA currently operates 2.4GW in coal and gas-fired power plants (2.9 GW until the end of year)
Integrated energy platform, with privileged access to natural resources
Only private power generator in Brazil with access to onshore gas
Short-term value triggers
- Reorganization of the company’s structure and continuous TPP’s operation stabilization
- Stronger role of E.ON, bringing technical expertise and cost discipline to ENEVA
Competitive greenfield portfolio
Licensed coal, gas and wind power generation projects
3
A Brazilian thermal generator with asset exposure to energy fossil fuels (natural gas and coal)
ENEVA at a Glance
2.9GW inflation-protected, long-term PPAs
o 2.4GW in operation
o 517MW under construction
Long-term PPAs guarantee R$2.2 billion in annual inflation-adjusted
capacity payments
PPAs provide hedge against commodity price exposure
Integrated gas E&P assets supply up to 8.4MM m³/day to ENEVA’s power
plants
Competitive portfolio of licensed greenfield wind, coal and gas fired
capacity
Company Description
4
ENEVA ownership structure
Geographic Footprint
Parnaíba I ENEVA 70% / Petra 30% Natural Gas - 676MW
Amapari Energia ENEVA 51% / Eletronorte 49% Diesel - 23MW
Itaqui ENEVA 100% Coal - 360MW
Natural Gas Exploratory
blocks Contracted production
of 8.4MM m3/day
Pecém I ENEVA 50% / EDP 50% Coal - 720MW
Pecém II ENEVA 100% Coal - 365MW
Parnaíba II ENEVA 100% Natural Gas - 517MW
Parnaíba III¹ ENEVA 70% / Petra 30%
Natural Gas - 176MW
Parnaíba IV¹ ENEVA 70% / Petra 30% Natural Gas - 56MW
Free Float (38.2%)
37.9% 23.9%
Other
MPX / E.ON Partipações Joint Venture
50%
50%
BNDES
10.3%
Eike Batista
Controlling Block
27.9%
Solar Tauá ENEVA 100% Solar - 1MW
Note: 1) Ownership structure assumes future MPX / E.ON Participações JV incorporation, as disclosed on the Material Fact Notice as of July 3, 2013
Company Overview
2
6
Creation of MPX (2007)
1,080MW in the A-5 (2007)
IPO (USD1.1BN)
365MW in the A-5 (2008)
Parnaíba Basin onshore exploratory blocks (2009)
Successful closing of E.ON partnership
Acquisition of greenfield projects
Beginning of commercial operations at Pecém I
Waivers received from the Regulatory Agency
Operational capacity reaches 2.4GW
E.ON stake increase to 36%, joining controlling block
Name changed to ENEVA
Signing of E.ON / Cambuhy recapitalization of Parnaíba Gás Natural to secure gas delivery
Asset stabilization plan developed with very good imminent results
ICB Online criteria from the Regulatory Agency achieved
Asset stabilization ongoing, further improvements on availability in Jan, 2014
Successful injunction halting ADOMP in Jan, 2014
Recapitalization efforts
Balance Sheet strengthening
Further cost reduction measures
Successful start of drilling campaign in Parnaíba (2010)
Parnaíba II 517MW contracted in A-3 auction
Power supply contracts for Parnaíba I secured (676MW), start of Parnaíba complex development
2 fields in Parnaíba declared commercial
Gavião Real and Gavião Azul with estimated production of up to 6MM m3/day
Unique Development Track, overcoming its Short Term Challenges
Key Milestones, Challenges & Outlook
2007 - 2009 2010 - 2011 2012
2013
2014
2.4GW of coal and gas-fired power plants in operation
Operational Assets (1)
7
Pecém I
Energy Source: Coal
ENEVA Stake: 50%
Installed Capacity: 720MW
Sold Energy: 615MW
Fixed Revenue¹: R$600.3MM p.a.
Start-up: May, 13
Energy Source: Coal
ENEVA Stake: 100%
Installed Capacity: 360MW
Sold Energy: 315MW
Fixed Revenue¹: R$317.3MM p.a.
Start-up: Feb, 13
Itaqui
Note: 1) Fixed revenues are indexed to inflation index – IPCA (Database: Nov, 2013)
Energy Source: Coal
ENEVA Stake: 100%
Installed Capacity: 365MW
Sold Energy: 276MW
Fixed Revenue¹: R$284.9MM p.a.
Start-up: Oct, 13
Pecém II
8
Parnaíba I (OCGT)
Energy Source: Natural Gas
ENEVA Stake: 70%
Installed Capacity: 676MW
Sold Energy: 450MW
Fixed Revenue¹: R$445.9MM p.a.
Start-up: Apr, 13
Energy Source: Natural Gas
ENEVA Stake: 70%
Installed Capacity: 176MW
Sold Energy: 98MW
Fixed Revenue¹: R$99.0MM p.a.
Start-up: Oct, 13
Parnaíba III (OCGT)
Energy Source: Natural Gas
ENEVA Stake: 70%
Installed Capacity: 56MW
Sold Energy: 46MW (Free Market)
Fixed Revenue¹: R$54.0MM p.a.
Start-up: Dec, 13
Parnaíba IV
2.4GW of coal and gas-fired power plants in operation
Operational Assets (2)
Note: 1) Fixed revenues are indexed to inflation index – IPCA (Database: Nov, 2013)
9
Energy Source: Natural Gas
ENEVA Stake: 100%
Installed Capacity: 517MW
Sold Energy: 450MW
Fixed Revenue¹: R$373.7MM p.a.
Start-up: 2H14
Parnaíba II (CCGT)
Note: 1) Fixed revenues are indexed to inflation index – IPCA (Database: Nov, 2013)
Additional 517 MW will come on stream
Power Plant under construction
Outstanding management capabilities
Financial strength and discipline
Sector know-how: E.ON E&P looks at a volume delivery of +170k
barrels/day and +60 licenses in GB and Norway
Tried and tested Parnaíba experience, know-how of Parnaíba Complex
rooted within PGN
Strong Shareholders¹
All Parnaíba gas-fired power plants are supplied by Parnaíba Gás Natural,
owner and operator of 8 onshore exploration blocks
ENEVA has a direct interest in PGN as key supplier of its TPPs
Declaration of commerciality with Development Plan for 3 gas fields:
Gavião Real, Gavião Branco and Gavião Azul
Gas supply agreements secured for 8.4MM m³/day
R$250 million capital injection concluded in Feb, 2014
Highlights
10
Integrated Natural Gas E&P
Strong competitive position in gas-fired generation
Parnaíba Gás Natural
18.2% 9.1% 72.7%
Geographic Footprint
Note: 1) Ownership structure after execution of the sale and purchase agreement between OGP and Cambuhy, subject to approval by OGP’s creditors, under its judicial recovery procedure, and authorization by ANP
37 wells drilled, of which 26 have gas indications
o 18 wells with discoveries
o 8 wells with gas indications
Declaration of commerciality with Development Plan for 3 gas fields:
o Gavião Real
o Gavião Azul
o Gavião Branco
Gavião Real field is producing since Jan, 2013:
o 16 producing wells out of 5 clusters
o Daily Production: 6.6MM m³/day of natural gas
o Connected to a 6.6MM m³/day GTU – Gas Treatment Unit (as of
today)
o All gas dedicated to ENEVA’s Parnaíba TPPs
Exploration Campaign
11
Integrated Natural Gas E&P
2014 / 2015:
o Connection of 3 additional production wells and GTU expansion to
8.4MMm³/day
o Gavião Branco production development and submission to ANP of
assessment plan for new discoveries (Mar, 2014)
Upcoming Events
Power Plant Parnaíba I, Parnaíba III
and Parnaíba IV Parnaíba II
Wells 16 19
Production Ramp-up (MM m³/day)
6.6
8.4
Current 2H14
Short-Term Value Triggers
3
Operating Costs
13
Operational Performance (Itaqui)
EBITDA (R$MM)
Availability Variable Revenue X Variable Cost (R$/MWh)
Sources: ONS & Company
Positive EBITDA driven by improved operational performance and reduced operating cost/MWh
COD: Feb 5, 2013
24.2
36.1
4Q13 1Q14
63%
83% 84% 87%
75%
1Q13 2Q13 3Q13 4Q13 1Q14
4Q13 1Q14 1Q14/ 4Q13
Operating Costs1 (R$ ‘000) 125,668 121,005 -3.7%
Gross Energy Generated (GWh) 660 583 -12%
Operating Costs per Gross Energy Generated (R$/MWh)
190.5 207.7 9.0%
NOTE: 1) Does not include Depreciation & Amortization.
261
232
144 159
128 149
112
141
108 103 115 121 126 129
107 106 103 102 102 100 104 108 107 113 116 119 120 112
Variable Cost Variable RevenueAvailability reduction in 1Q14 due to mainly maintenance in coal mils, fan equipment and emissions control systems
14
Operational Performance (Pecém II)
Variable Revenue X Variable Cost (R$/MWh) Availability
Sources: ONS & Company
EBITDA positively impacted by high availability and recurring positive margin on dispatch
EBITDA (R$MM)
COD: Oct 18, 2013
N.A. N.A. N.A.
85%
97%
1Q13 2Q13 3Q13 4Q13 1Q14
55.4
46.3
4Q13 1Q14
92 99 111 99 106 101
114 118 122 125 125 118
Variable Cost Variable Revenue
NOTE: 1) Does not include Depreciation & Amortization.
Operating Costs
4Q13 1Q14 1Q14/ 4Q13
Operating Costs1 (R$ ‘000) 92,446 99,414 7.5%
Gross Energy Generated (GWh) 558.1 720.8 29%
Operating Costs per Gross Energy Generated (R$/MWh)
165.7 137.9 -17%
15
Operational Performance (Parnaíba I)
EBITDA (R$MM)
Availability Variable Revenue X Variable Cost (R$/MWh)
Sources: ONS & Company
OBS: Dispatch margin captured by Parnaíba Gás Natural
Growth in operating costs per MWh justified by increase in Henry Hub prices and offset by
increase in variable revenues
COD: Feb 1st, 2013 to
Apr 12, 2013
96% 91%
96% 96% 99%
1Q13 2Q13 3Q13 4Q13 1Q14
32.0
44.8
4Q13 1Q14
77 74 65 75 80 68 77 78 74 79 90
77 79 77
80 82 94 99 100 96 93 99 95 92
104 121
152 134
Variable Cost Variable Revenue
NOTE: 1) Does not include Depreciation & Amortization.
Operating Costs
4Q13 1Q14 1Q14/ 4Q13
Operating Costs1 (R$ ‘000) 183,576 221,902 21%
Gross Energy Generated (GWh) 1,370 1,411 3.0%
Operating Costs per Gross Energy Generated (R$/MWh)
134.0 157.2 17%
Operating Costs
16
Operational Performance (Pecém I)
Availability
NOTES: 1) Figures consider 100% of Pecém I; 2) Does not include Depreciation & Amortization.
Variable Revenue X Variable Cost (R$/MWh)
EBITDA negatively impacted by high unavailability costs due to outage of Turbine #1
Sources: ONS & Company
In Jan, 14, Turbine #1 was 744 hours unavailable primarily due to shaft maintenance and hydrogen seal replacement, started in 4Q13
COD: Dec 1st, 2012 May 10, 2013
72%
41%
66%
51%
71%
1Q13 2Q13 3Q13 4Q13 1Q14
61.7
48.8
4Q13 1Q14
151 127 118
318
154
117 139 138
109 119 107
134
106 107
110
111 105 104 100 99 99 97 102 105 106 110 114
117 118
110
Variable Cost Variable Revenue
4Q13 1Q14 1Q14/ 4Q13
Operating Costs2 (R$ ‘000) 265,301 230,220 -13%
Gross Energy Generated (GWh) 693 1,014 46%
Operating Costs per Gross Energy Generated (R$/MWh)
382.7 227.1 -41%
EBITDA1 (R$MM)
Operating Costs
17
Operational Performance (Parnaíba III)
NOTES: 1) Figures consider 100% of Parnaíba III; 2) Does not include Depreciation & Amortization.
Availability Variable Revenue X Variable Cost (R$/MWh)
Sources: ONS & Company
OBS: Dispatch margin captured by Parnaíba Gás Natural
EBITDA margins negatively impacted by energy acquisition costs as full capacity was reached
only in February 2014
COD: Oct 22, 2013
N.A. N.A. N.A.
100% 96%
1Q13 2Q13 3Q13 4Q13 1Q14
1.1
14.4
4Q13 1Q14
75 71 69 69 61
161 161 161 161 161
Jan-13...Out-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14
Variable Cost Variable Revenue
4Q13 1Q14 1Q14/ 4Q13
Operating Costs2 (R$ ‘000) 124,329 61,880 -50%
Gross Energy Generated (GWh) 0 344 -
Operating Costs per Gross Energy Generated (R$/MWh)
- 179.6 -
EBITDA1 (R$MM)
R$1.5 billion Capitalization and Debt Measures
Capitalization and Debt Maturity Profile Extension
Private capital increase in two steps, amounting
up to R$1.5 billion:
o Phase I
• Amount: up to R$316.5 million
• Price: R$1.27/share (closing price May 9, 2014)
• E.ON commitment: R$120 million
o Phase II
• Amount: R$1,500 million minus funds raised in
Phase I
• E.ON commitment: up to R$450 million (potentially
partially by injecting Pecém II)
Sale of Pecém II
o ENEVA will dispose of 50% or 100% of Pecém II in a
structured bidding process
o In parallel to Phase I of the Capital Increase
o E.ON to backstop sale of 50% of Pecém II at a
maximum price of R$400 million
Capital Increase and Sale of Pecém II
18
HoldCo financing banks to provide short-term
HoldCo bridge of R$100 million in parallel to the
Phase I Capital Increase
Push-down of R$600-700 million to ENEVA‘s
operating subsidiaries/projects
5-year maturity extension of remaining HoldCo
debt, with amortization starting only in June 2017
Financing banks to issue LT financing on Pecém II
o Banks to provide additional Pecém II LT financing
amounting to R$150 million in parallel to the conclusion
of the sales process of Pecém II
ENEVA committed to reduce HoldCo cost until YE
to a sustainable level of R$80 million/year
Debt Measures & Cost Reduction
19
Consolidated Debt (end of 1Q14) Significant reduction of short-term indebtedness secured by agreement with banks signed in May
Consolidated Debt (R$MM)
Total Gross Debt R$6,099MM
Consolidated Gross Debt Profile (R$MM)
R$871.8MM out of the total debt balance of short-term debt is
allocated in the projects, as follows:
o R$290.3MM: Current portion of the long-term debts of Itaqui,
Pecém II and Parnaíba I;
o R$87.3MM: Bridge loans to Parnaíba I. The outstanding balance will
be paid-off in installments, which started in October, 2013;
o R$494.2MM: Bridge loans to Parnaíba II, which should be paid-off
with the disbursement of the long-term financing packages.
On May 12, 2014 concluded a debt transaction comprising in:
o Push-down of R$600-700MM to projects;
o 5-year maturity extension of remaining HoldCo. debt, with
3 years of grace period.
+1.2% (net debt)
Gross Short-Term Debt R$2,478MM
Consolidated Short-Term Debt (R$MM)
2,478 41%
3,621 59%
Short Term Long Term
1,606 65%
872 35%
Hold Co. Project Related
5,933 6,002
278 96
4Q13 1Q14
Net Debt Cash and Cash Equivalents
6,221
6,099
Brazilian Power Market and Greenfield Portfolio
4
Southeast Reservoirs
~70% of total storage capacity
Source: ANEEL
Brazil’s Generation Capacity: 136 GW
Breakdown by source – April, 2014
Brazil is highly dependent on hydro generation with increasingly faster depletion of reservoirs
Brazilian Energy Matrix
21
Dry Season
63.5% 10.5%
2.5%
1.5%
2.2%
19.8%
Hydro Gas Coal Nuclear Wind Others
67% 56%
76%
29% 38%
43% 40% 35% 36%
39%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Average 2007-2011 2012 2013 2014
Source: ONS
Autonomy = Storage Capacity / (Load – Thermal Generation)
Economic growth will boost power demand
leading to a supply deficit in 2016
Water storage capacity has stagnated,
leading to decreased system autonomy
65
86
65
78
60
65
70
75
80
85
90
2013 2014 2015 2016 2017 2018 2019 2020
GW
avg
ENERGY DEMAND
PHYSICAL GUARANTEE
(with signed PPAs)
2016-on: New generation required ~8 GWavg required until 2020
22
Electric System Reliability
New thermal plants are necessary to guarantee reliable power supply
0
5
10
15
20
25
30
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
Reservo
irs A
uto
no
my (
Mo
nth
s)
2013
Current reservoir autonomy ~6 months
Parnaíba Complex
Integrated to natural gas resources
Located in a tax-advantaged region
Ventos Wind Complex
Located in one Brazil’s best wind resource areas
Attractive load factor
Just 30km from grid connection
Land ownership assured
Açu (Coal + Gas)
Located at a port with a regasification terminal build license
150km from Campos Basin natural gas accumulations
Environmental licensed to both coal and gas operations
Sul & Seival Integrated to the Seival Mine (proven reserves: 152 M ton)
Low operation costs
Power
supply-demand
unbalanced
Hydropower
concentrated
matrix
Spot prices at
historical highs
Demand for base-
load generation
Opportunities
for ENEVA’s
growth 2 3 4 5 1
Sul 727 MW
Parnaíba Complex 2,166 MW
Seival 600 MW
Açu 2,100 MW – Coal 3,300 MW – Natural Gas
Solar Tauá 1 MW
Ventos Wind Complex 600 MW
Seival Mine License granted 152 M ton in proven reserves
ENEVA’s Greenfield Portfolio
23
Attractive licensed greenfield projects in various development stages
Appendix | Images
5
Pecém I & II
25
Itaqui
26
Parnaíba Complex
27
Natural Gas: Parnaíba E&P
28
Disclaimer
The material that follows is a presentation of general background information about ENEVA S.A. and its subsidiaries (collectively, “ENEVA” or the “Company”) as of
the date of the presentation. It is information in summary form and does not purport to be complete. No representation or warranty, express or implied, is made
concerning, and no reliance should be placed on, the accuracy, fairness, or completeness of this information.
This presentation may contain certain forward-looking statements and information relating to ENEVA that reflect the current views and/or expectations of the
Company and its management with respect to its performance, business and future events. Forward looking statements include, without limitation, any statement
that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words like “may”, “plan”, “believe”, “anticipate”,
“expect”, “envisages”, “will likely result”, or any other words or phrases of similar meaning. Such statements are subject to a number of risks, uncertainties and
assumptions. We caution you that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates
and intentions expressed in this presentation. In no event, neither the Company, any of its affiliates, directors, officers, agents or employees nor any of the
placement agents shall be liable before any third party (including investors) for any investment or business decision made or action taken in reliance on the
information and statements contained in this presentation or for any consequential, special or similar damages.
This presentation does not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or purchase any securities.
Neither this presentation nor anything contained herein shall form the basis of any contract or commitment whatsoever.
Recipients of this presentation are not to construe the contents of this summary as legal, tax or investment advice and recipients should consult their own advisors
in this regard.
The market and competitive position data, including market forecasts, used throughout this presentation were obtained from internal surveys, market research,
publicly available information and industry publications. Although we have no reason to believe that any of this information or these reports are inaccurate in any
material respect, we have not independently verified the competitive position, market share, market size, market growth or other data provided by third parties or
by industry or other publications. ENEVA, the placement agents and the underwriters do not make any representation as to the accuracy of such information.
This presentation and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole or in part without ENEVA’s prior
written consent.
Thank you. www.eneva.com.br
top related