EDP ​​Renováveis: ambitious goals 2021/25

EDP ​​Renováveis: ambitious goals 2021/25

RESULTS 2020

EDPR’s revenues at the end of 2020 decreased by 5%, up to 1,731 million euros, with an impact of MW capacity (-47 million € vs 2019), wind resources (-89 million vs 2019) and others (-9 million vs 2019) as it has not been compensated with the higher sales prices (+53 million vs 2019).

Operating costs, OPEX totaled € 568 million, -1% vs 2019 and EBITDA in 2020 amounts to € 1,655 million, in line with the figure recorded a year ago. Net income grew 17%, to € 556 million.

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EDP ​​Renováveis: ambitious goals 2021/25

SOLVENCY AND LIQUIDITY

Net Debt at the end of 2020 totaled 3,443 million euros (+640 million vs 2019), reflecting, on the one hand, the cash generation from the assets in operation, and on the other hand, the investments made in the period, including the purchase of Viesgo’s renewable business and the effect of the exchange rate.

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EDP ​​Renováveis: ambitious goals 2021/25

OPERATING RESULTS

EDPR had a 12.2GW portfolio of operating assets at the end of 2020, with an average life of 9 years, of which 11.5GW fully consolidated and 669MW consolidated by equity (Spain, Portugal, EU, and Offshore). Last year, EDPR added 1,580 MW, including 486MW from the purchase of Viesgo’s renewables business.

As of Dec 2020, EDPR has 2.4GW of new capacity under construction, of which 1,648MW related to onshore wind energy, 404MW solar and 311MW with equity-consolidated interests in offshore wind.

The annual evolution maintains the line with the lowest average installed capacity vs 2019, following the execution of EDPR’s Sell-Down strategy. In 2020 the average sale price was 3% lower than in 2019.

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EDP ​​Renováveis: ambitious goals 2021/25

STRATEGIC PLAN 2021-25

EDPR recently carried out a capital increase of € 1,500.25 million in the context of its new Strategic Plan 2021-25, to partially finance the CAPEX of € 19 billion for the installation of 20GW of renewable energy capacity until 2025. The objective set by the company in this new plan to achieve the An additional 20GW in 2021/25 is an installation rate of 4GW / year. 41% will be solar, 54% onshore wind, 3% offshore wind and 2% other energy.

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Regarding the objectives in terms of results, EDPR wants to achieve an EBITDA of € 2,000 million in 2023 and raise it to 2,300 in 2025 (+ 7% CAGR20-25); The Net Result will be, according to its objectives,> € 600 million in 2023 and € 800 million in 2025 (+ 8% CAGR 20-25).

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EDP ​​Renováveis: ambitious goals 2021/25

BUY VIESGO

The energy Group reached an agreement with certain funds managed by Macquarie Infrastructure and Real Assets to acquire control of Viesgo’s energy business. Specifically, EDPR will acquire 100% of the 511 MW (EBITDA + Equity Income MW) portfolio of renewable capacity installed in Spain (84%) and Portugal (16%). It is a high-quality portfolio with a strong wind resource (average utilization factor of 29%) and a low risk profile, of which 87% of the capacity is regulated with an average age of 13 years (there are about 7 years of regulated life). The portfolio also has attractive potential for future extensions / enhancements given the profile mentioned above.

The amount to be paid by EDPR for Viesgo’s renewable business corresponds to a business value (EV) of 565 million euros, which represents a ratio between EV and net MW of 1.1 million euros.

This transaction reinforces EDPR’s position as one of the main leaders in the renewable energy market, particularly in Spain, with a highly synergistic portfolio of high quality assets, with strong wind resources and a low risk profile, also offering interesting growth opportunities in the future.

SHAREHOLDER REMUNERATION

In its new Strategic Plan, EDPR marks a floor for the dividend of € 0.08 / share. In its last AGM in 2021, the Group approved the proposal of the Board of Directors regarding the payment of a gross dividend of 0.08 euros per share, which means distributing 69.78 million as an ordinary dividend and 7.06 million euros as a dividend complementary. Payment will be made in May 2021.

FUNDAMENTAL ASSESSMENT

In an analysis by ratios on estimated results and low forecast for the end of 2021 (EPS: € 0.45 / share), the market price is already very adjusted to the company’s valuation. It is trading at a PER> 43v, higher than its historical average and adjusted against its competitors. Also by multiple on sales and on book value the valuation is already very adjusted. It pays a dividend, but very little. Expensive action.

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EDP ​​Renováveis: ambitious goals 2021/25

Based on our fundamental valuation, we are neutral with the medium / long-term value.

COMPANY’S DESCRIPTION

EDP ​​Renováveis is specialized in the production of electricity from renewable energies. The group’s activity is organized around 3 segments:

With a strong development channel, first-class assets and market-leading operational capacity, EDPR has experienced exceptional development in recent years and is currently present in 14 markets (Belgium, Brazil, Canada, France, Greece, Italy, Mexico, Poland, Portugal, Romania, Spain, United Kingdom, United States and Colombia).

EDPR’s main shareholder is EDP ​​Group, with 83% of the share capital. Energías de Portugal, SA (“EDP”), is a global energy company and leader in value creation, innovation and sustainability. EDP ​​remains on the Dow Jones Sustainability Index for 13 consecutive years.

Excluding the participation of the EDP Group, as of December 2017, EDPR’s shareholders comprise more than 30,000 institutional and private investors distributed in 22 countries with a primary focus on the United States. Institutional investors represented 94% of the company’s shareholders, mainly mutual funds and socially responsible investors (“SRI”), while private investors, mostly Portuguese, represent 6%.

INDICES of which it is part:

LC 100 EUROPE

PSI 20

PSI ALL-SHARE

PSI UTILITIES