71 86 100 118 1542018 2202020 5002025
INVESTOR PRESENTATION Q1 2019
22.02.2019 1
COMPANY OVERVIEW
B U S I N E S S M O D E L & P O R T F O L I O F I N A N C I A L P O S I T I O N C A P A C I T Y & M A R K E T C A P
2
Business Model & PortfolioPure-play PV operator with 166 MW own assets, and 77 MW external management contracts
3
ASSET MANAGEMENTIPP PORTFOLIO PV ESTATE
CASH FLOWS
Acquire assets
Develop new projects
(Re-) finance
Optimise & operate
166 MW
SYNERGIES
Recurring fees from external investors
Economies of scale
M&A potential
77 MW
Acquired from Ernst Russ AG on 19.02.2019
TERMINAL VALUE
No land lease costs
Repowering potential for PV parks already in use
Development potential for unused land
110 HECTAR
Business Model & PortfolioCurrent IPP portfolio generates annual EBITDA of at least EUR 34 Mio.
Portfolio characteristics
CAPACITY TARIFF YIELD REVENUES EBITDA
MWp EUR/MWh kWh/kWp EUR Mio EUR Mio
Freefield PV 91 246 1,003 22.4 19.9
Rooftop PV 72 262 881 16.7 14.0
Onshore wind 3 86 2,400 0.6 0.4
IPP PORTFOLIO 166 246 973 39.7 34.3
LOCATIONS > 1 MW
4
▪ PV assets concentrated in Bavaria, Eastern Germany, and Rhineland-Palatinate
▪ Average plant size: 1.2 MWp
▪ Average year of commissioning: 2011
▪ Average feed-in-tariff: EUR 246/MWh.
▪ Tariffs are state-guaranteed and fixed for 20 years + year of commissioning
▪ Rooftop and land lease contracts usually running 20 years + at least 5 years extension option
▪ Small diversification into onshore wind (up to max. 10% of portfolio)
Financial Position Robust financials with annual dividend of EUR 0.10/share
CASH FLOW PER SHARE AND EQUITY RATIOEBITDA EVOLUTION AND RETURN
0.10 0.10
0.26
0.410.45
0.49 0.52
18%
23%
25%
29% ~ 30%
0%
5%
10%
15%
20%
25%
30%
35%
0.00
0.10
0.20
0.30
0.40
0.50
0.60
2014 2015 2016 2017 2018F
Dividend per share Cash Flow per share Equity ratio
16.7
24.927.9
29.933.0
5.4%
7.6%
8.9%
9.6%~9.5%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
2014 2015 2016 2017 2018F
EBITDA in EUR Mio.
Return (clean EBITDA/total assets until 2017, EBITDA/total assets for 2018F)
5
30
40
50
60
70
80
90
100
110
120
130
140
150
160
170
180
190
200
30
40
50
60
70
80
90
100
110
120
130
140
150
160
170
180
190
200
Jan
-15
Fe
b-1
5
Mar-
15
Ap
r-15
Ma
y-1
5
Jun
-15
Jul-1
5
Au
g-1
5
Se
p-1
5
Oct-
15
Nov-1
5
Dec-1
5
Jan
-16
Fe
b-1
6
Mar-
16
Ap
r-16
Ma
y-1
6
Jun
-16
Jul-1
6
Au
g-1
6
Se
p-1
6
Oct-
16
Nov-1
6
Dec-1
6
Jan
-17
Fe
b-1
7
Mar-
17
Ap
r-17
Ma
y-1
7
Jun
-17
Jul-1
7
Au
g-1
7
Se
p-1
7
Oct-
17
Nov-1
7
Dec-1
7
Jan
-18
Fe
b-1
8
Mar-
18
Ap
r-18
Ma
y-1
8
Jun
-18
Jul-1
8
Au
g-1
8
Se
p-1
8
Oct-
18
Nov-1
8
Dec-1
8
Jan
-19
Fe
b-1
9
Capacity in MWp Market cap in EUR Mio
Capacity and Market CapTrack record of growth and capital appreciation
2014-15ACQUISITION COLEXON
IN NEW SHARES + RESTRUCTURING
(26 MWP)
2015-16ACQUISITION
MISKINA IN NEW SHARES +
OPTIMISATION(24 MWP)
2016-17GROWTH TO 115 MWP THROUGH
PRIVATE PLACEMENTS
2018UP TO ~150 MWP
THROUGH ACQUISITION OF
DEVELOPER +ALTERNATIVE
FINANCING
6
2018-19CAPITAL-
INTENSIVE GROWTH TO 220
MWP BY 2020
VIEW ON GERMAN PV MARKET
E E G F E E D - I N T A R I F F S N E W M O D E L S T O M A R K E T P VP V C O M P E T I T I V E N E S S
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PV CompetitivenessSolar PV now the lowest-cost power generator, even cheaper than conventional power
HIGHER EFFICIENCY MODULES
MODULE COST DECLINES
FALLING LEVELISED COST OF ELECTRICITY (LCOE)
Source: IRENA Source: LazardSource: IRENA
-
0.40
0.80
1.20
1.60
2.00
2.40
2.80
Feb
10
Jun
10
Oct
10
Feb
11
Jun
11
Oct
11
Feb
12
Jun
12
Oct
12
Feb
13
Jun
13
Oct
13
Feb
14
Jun
14
Oct
14
Feb
15
Jun
15
Oct
15
Feb
16
Jun
16
Oct
16
Feb
17
Crystalline China
Crystalline Europe (Germany)
Crystalline Japan
Thin film
8
EEG Feed-In TariffsFixed tariffs still at attractive levels, but difficult to scale up
SYSTEM COST GERMANY 750 KWP ROOFTOP
▪ No relevant decrease in tariffs for new-build since 2014 due to
annual capacity additions below the 2.5 GWp regulatory target
▪ 20% decline in panel prices in H2 2018 reflecting:
1. Subsidy stop for new PV projects in China
2. End of import duty on Chinese panels in Europe
▪ Government decided a to cut new-build tariffs for large rooftop
by 10% during the period Feb-April 2019.
▪ The <750 kWp segment remains attractive, but limitations to
scale up in size and time (no longer EEG tariffs once 52 GWp cap
is reached)
7C SOLARPARKEN VIEW:
EUR/MWhEUR/Wp
9
-
10
20
30
40
50
60
70
80
90
100
110
120
-
0.20
0.40
0.60
0.80
1.00
1.20
1.40
2015H1
2015H2
2016H1
2016H2
2017H1
2017H2
2018H1
2018H2
2019Q1
2019Q2
BOS EUR/Wp
PV Panel EUR/Wp
FIT Large rooftop EUR/MWh
Freefield < 750 kWp EUR/MWhFIT FOR NEW PROJECTS Q2’19
Large rooftop < 750 kWp: ~ EUR 90/MWh
Freefield < 750 kWp: ~ EUR 80/MWh
New Models to Market PV PowerA. Market Parity
WHOLESALE POWER PRICE AND PV AUCTIONS > 750 KWP OPTION A: SELL POWER AT THE AUCTION (FFAV TARIFF)
▪ Fixed state-guaranteed tariff for 20 years
▪ Principally from 750 kWp to 10 MWp
▪ EEG limitations: rooftop, conversion land, alongside motorways
▪ Allocated FFAV or auction tariff is paid out on a monthly basis as
market price + market premium (at least zero)
▪ Captures upside from rising market price (FFAV tariff as minimum)
▪ Special auctions: 500 MWp in Dec ‘19, 1 GWp in 2020 and 1 GWp
in 2021
OPTION B: CORPORATE PPA
▪ Long-term contract with utility or corporate wholesale
customer who purchases green power at a fixed price
▪ No limitation on size or on land as long as compliant to
construction law
▪ Suitable for large freefield installations
▪ Driver: LCOE of large freefield PV (EUR 45-60/MWh in 2019)
▪ Corporate PPA market in Germany only a recent occurrence
-
10
20
30
40
50
60
70
80
90
100
27
/07
/20
06
27
/01
/20
07
27
/07
/20
07
27
/01
/20
08
27
/07
/20
08
27
/01
/20
09
27
/07
/20
09
27
/01
/20
10
27
/07
/20
10
27
/01
/20
11
27
/07
/20
11
27
/01
/20
12
27
/07
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12
27
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13
27
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13
27
/01
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14
27
/07
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14
27
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15
27
/07
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15
27
/01
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16
27
/07
/20
16
27
/01
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17
27
/07
/20
17
27
/01
/20
18
27
/07
/20
18
27
/01
/20
19
EEX market price (EUR/MWh)
FFAV/auction tariff EUR/MWh
10
~ 160
91 9064
5
-
20
40
60
80
100
120
140
160
180
Industrial client<20 kV
EEG levy for2019
Imbalance risk Theoreticalpricing for PPA
FIT large roof750 kWp,
Q2'19
New Models to Market PV PowerB. Grid Parity
DISTRIBUTED GENERATION AT MEDIUM-VOLTAGE
Prices in EUR/MWh
▪ Long-term contract with on-site client who buys green
power at a fixed price
▪ At mid-voltage level, end-user / industrial clients pay on
average EUR 160/MWh for their power including the EEG
levy of EUR 64/MWh.
▪ Ideally suited to large rooftop PV installations
▪ Driver: LCOE of rooftop PV (<EUR 90/MWh in 2018)
▪ On-site consumption market not developed yet in
Germany as feed-in tariffs for large rooftops, prior to
Q2’19, were at higher levels than the theoretical pricing of
a PPA (EUR 91/MWh)
▪ Significant potential as from Q2’19 due to the further
monthly drop in feed-in tariffs for rooftop projects
ON-SITE PPA
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CAPACITY PLAN 2018-2020
T I E R - T W O T A R G E T 2 0 2 0 : 2 2 0 M W P V I S I O N 2 0 2 5 : 5 0 0 M W P
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Tier-TwoTarget: Tier-2 player to benefit from improved valuation and cost of capital
OVERVIEW LISTED YIELDCOS & GREEN IPP’S IN EUROPE
TIER 1+2 TIER 3
-
200
400
600
800
1,000
1,200
1,400
1,600
Market cap EUR Mio. MW
Clear benefits for 200 Mio. EUR market caps / 200 MW players
- Access to a broader class of institutional investors who are
looking for long-term cash flows and defensive yield stocks.
- Increased leverage potential at corporate level (to finance
“big” deal) and cheaper debt
- Tier 1+2: average net debt/EBITDA ~6x
- Tier 3: average net debt/EBITDA ~5x
- Improved equity valuation
- Tier 1+2: average price/cash flow ~8x (min. 6x)
- Tier 3: average price/cash flow ~5x
MANAGEMENT VIEW
< 200 MW
< 200 Mio. EUR
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Target 2020: 220 MWpContinuation of growth acceleration with EUR 16 Mio fresh capital required to meet 220 MWp
BREAKDOWN OF BUILD UP PLAN TO 220 MW (STATUS NOV’18)
▪ 66 MWp planned additions: through own development and
acquisition of operating parks
▪ Capex budget: EUR 107 Mio.
▪ Project financing: EUR 72 Mio.
▪ Equity financing: EUR 35 Mio.
▪ EBITDA contribution: at least EUR 9 Mio. The 66 MWp new
investments assume an average specific yield of 965 kWh/kWp
and an average FIT of EUR 170/MWh (mix of old parks and
new-build).
▪ Net cash flow contribution: at least EUR 7 Mio.
▪ Requires capital increase of EUR 16 Mio.
MANAGEMENT INDICATION
14
118
154
220
0
50
100
150
200
250
2017 2018 2019 2020
OBJECTIVE TO ALLOCATE EQUITY OF EUR 35 MIO.
YIELDING NET CASH FLOW OF > EUR 7 MIO.
Vision 2025: 500 MWCapturing future opportunities once the Tier-2 status is reached
POTENTIAL POOL OF LARGER SCALE ACQUISITIONS & DEVELOPMENT
IPP PORTFOLIO ASSET & FUND MANAGEMENT500 MW
CONSOLIDATION: 15 GWp existing PV installations > 1 MWp in Germany
AUCTIONS: Special rounds in 2019-21, including innovative auctions
PPA: Large scale opportunities > 10 MWp upon further LCOE improvement
REPOWERING: 4 GWp runs out of the tariff by 2025
EXPLORE OPPORTUNITIES: in other stable and mature EU countries
200 MWP IPP AND 200 MIO EUR CAP IS AN ENABLER
▪ An improved / cheaper access to debt
▪ Attract large institutional investors as new
shareholders, mainly those who reallocate funds
out of conventional utilities into green energy
LEADING & DRIVING THIRD-PARTY INVESTORS
▪ Identify the right investment that fits in their
sustainability agenda
▪ Monetize expertise
▪ Financial flexibility between IPP and asset management
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FINANCIAL TARGETS
2 0 1 8 G U I D A N C E E B I T D A & C F P S T A R G E T D I V I D E N D P O L I C Y
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2018 GuidanceEBITDA will rise to EUR 33 Mio, CFPS to EUR 0.52
REPORTED FIGURES FORECAST
in Mio. EUR Q1'18 H1'18 9M '18 2018F
Revenues 5.1 20.4 35.7 39.5
_ Power sales 5.0 20.2 35.5 39.2
_ Other revenues 0.1 0.2 0.2 0.3
Other operating income 0.9 1.0 1.9 1.0
Cost of sales and opex 1.7 3.4 5.9 7.5
EBITDA 4.3 18.0 31.7 33.0
Cash interest paid -2.7 -5.7
Full-year interest expense SSD (*) -0.6
Taxes paid -0.1 -1.3
Net cash flow (**) 15.2 25.4
Average number of shares 46.9 49.3
CFPS (per share data) (**) 0.32 0.52
Net debt 160.4 163.6 163.6 166.0
Equity ratio 29.2% ~ 30%
Outlook for 2018 reflects strong production yield
(*) in Feb ‘18, 7C Solarparken issued a Schuldschein of EUR 25 Mio. at an average interest cost of 2.78%. Nonetheless, the first annual interest payment is
scheduled for Feb ’19 and therefore there is no cash interest to be paid during 2018.
(**) To provide a more realistic view, management indicatively presents the net cash flow and CFPS under the assumption as there would be a pro-rata cash
interest paid on the SSD
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7C SOLARPARKEN WILL REPORT THEIR FY’18 RESULTS ON 23 APRIL 2019
EBITDA & CFPS targetTowards EBITDA > EUR 41 Mio. upon executing the Plan 2018-2020
ESTIMATED EBITDA AND NET CASH FLOW SHOWCASE 220 MWP (EUR MIO) MANAGEMENT COMMENT
▪ EBITDA to increase by EUR 9.3 Mio to EUR 41.3 Mio following
acquisition / commissioning of the planned 67 MWp.
▪ Net cash flow contribution from the added capacity is EUR 7.3 Mio.
reflecting EUR 2 Mio interest costs on the EUR 72 Mio underlying
project loans (2.8% interest cost).
▪ The number of shares is planned to increase from 53.4 Mio. to
59.1 Mio. upon execution of the financing plan. The planned capital
increase of EUR 16 Mio could create ~5.7 Mio. new shares
▪ Cash Flow per Share: targeted to rise to EUR 0.57/share
▪ Net debt will reflect the capex plan and rise from EUR 166 Mio.
(year-end ‘18) to EUR 220 Mio. in 2020.
32.5
41.3
33.6 1.0
1.5
9.3
4.8 2.0
1.0
-
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
45.0
EBITDA > EUR 41 Mio.
CFPS to rise to EUR 0.57/share
18
Dividend PolicyStable annual dividend or equivalent, cash-flow related but at least EUR 10ct/share
DIVIDEND OUTLOOK 2018
▪ Partly exempt of German withholding tax: First-time dividend
over 2017 of EUR 10ct/share has been paid out exempt of
withholding tax in Germany. The same regime will apply in part for
the 2018 dividend.
▪ Strong comfort on 2018 numbers
▪ Equity ratio well above 25%
▪ CFPS guidance “at least EUR 0.52/share in 2018” versus
EUR 0.49/share in 2017
DIVIDEND POLICY
▪ A stable and preferably increasing dividend or dividend
equivalent
▪ Shareholders can be rewarded in cash, in stock or through a
buyback of shares
▪ Dividend growth will generally be in line with the performance
of the company results (CFPS as current performance
indicator), as long as it does not affect the 25% equity ratio.
AT LEAST EUR 10CT/SHARE PLANNED FOR 2018
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THE SHARE & GOVERNANCE
O W N E R S H I P M A N A G E M E N TO U T P E R F O R M A N C E
20
Outperformance Among German Developers & IPPsLed by defensive character and growth
50
70
90
110
130
150
170
190
Dec
-14
Mar
-15
Jun
-15
Sep
-15
Dec
-15
Mar
-16
Jun
-16
Sep
-16
Dec
-16
Mar
-17
Jun
-17
Sep
-17
Dec
-17
Mar
-18
Jun
-18
Sep
-18
7C Solarparken Encavis
PNE Wind Energiekontor
ABO Invest
4-YEARS SHARE PRICE PERFORMANCE (REBASED) SHARE PRICE PERFORMANCE 2018 (REBASED)
75
80
85
90
95
100
105
110
115
7C Solarparken Encavis
PNE Wind Energiekontor
ABO Invest
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Librae Holding10.6%
Rodolphe de Spoelberch8.1%
Distri Beheer6.0%
Steven De Proost4.7%
DVP Invest4.5%
XIX Invest4.4%
Sufina3.1%
Vlaamse Energieholding
3.1%
Free float, 55.7%
OwnershipObjective to further institutionalize the shareholders’ structure and to increase free float
SHAREHOLDERS STRUCTURE Q1’2019
38.4% 38.7%
43.4% 44.0%
53.5%55.7%
2014 2015 2016 2017 2018 Q1'19
TREND IN FREE FLOAT
▪ Rising free float reflects the regular issue of new shares to new
institutional investors via private placements , and brings about
increased liquidity in the stock.
▪ Target is to attract larger institutional investors to support the
growth trajectory to 220 MWp and the long-term vision of 500
MWp
22
ManagementEntrepreneurship and industry-expertise
Steven De Proost, CEO
✓ Utilities & energy analyst and head of equity research at Delta Lloyd and Dexia
✓ Ranked by Handelsblatt as best analyst in the German power industry in 2008
✓ Founder of 7C Solarparken NV
✓ CEO of 7C Solarparken AG as June 2014 with responsibilities for Strategy & Budgeting, Investor
Relations and Technical operations
✓ Voted best CEO in European Solar Industry 2017 by CEO Magazine
Koen Boriau, CFO
✓ Buy-side analyst and fund manager at Selectum
✓ Sector analyst for shipping & renewable energies at Dexia
✓ Co-founder of 7C Solarparken NV
✓ CFO of 7C as from May 2014 with responsibilities for Finance, Operations and Legal affairs
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CONTACT
7C SOLARPARKEN AG
An der Feuerwache 15
95445 Bayreuth / Germany
+49 (0) 921 23 05 57 77
www.solarparken.com
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