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Results Presentation
Full Year 2015 May 13th, 2016
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Disclaimer
This document has been prepared by Grupo Isolux Corsán, S.A.; therefore no part of it may be published, disclosed or distributed in any form or by any means, nor used by any other person or entity, without the prior written consent of Grupo Isolux Corsán, S.A. This document contains statements related to our future business and financial performance and future events or developments involving us that may constitute forward-looking statements. These statements may be identified by words such as “expects,” “looks forward to,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “will,” “project” or words of similar meaning. We may also make forward-looking statements in other reports, in presentations, in material delivered to shareholders and in press releases. In addition, our representatives may from time to time make oral forward-looking statements. Such forward-looking statements and information are based on the current expectations and assumptions, and are, therefore, subject to certain risks and uncertainties. A variety of factors, which are beyond our control or may be difficult to predict, affect our operations, performance, business strategy and results and could cause our actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements or anticipated on the basis of historical trends. Should one or more risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results, performance or achievements may vary materially from those described in the relevant forward-looking statement as being expected, anticipated, intended, planned, believed, sought, estimated or projected. We neither intend, nor assume any obligation, to publicly update or revise these forward-looking statements in light of developments which differ from those anticipated. The information contained in this document has not been verified or revised by the auditors of Grupo Isolux Corsán, S.A. Certain data included in this presentation has been subject to rounding adjustments. Accordingly, in certain instances, the sum of the numbers in a column or a row in tables may not conform exactly to the total figure given for that column or row. This document does not constitute or form part of any offer for sale or subscription of or solicitation or invitation of any offer to buy or subscribe for any securities in any jurisdiction, including in the United States, nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever. Specifically, this presentation does not constitute a “prospectus” within the meaning of the Securities Act.
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Results Presentation FY 2015 | Table of Contents
Table of Contents 1. Key Developments
2. Business and Financial Highlights
i. EPC
ii. Concessions
3. Cash flow and debt overview
4. Appendix
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1. Key Developments
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Results Presentation FY 2015 | Key Developments
Group
Financials
FY 2015 consolidated Revenues reached €2,189 million.
FY 2015 consolidated EBITDA: €176 million. EBITDA includes non-recurring losses coming from Brazil where macro environment led to a significant
slowdown in collections, resulting in project cancellations. This effect represents approximately €34 million of negative EBITDA.
FY 2015 Net loss of €52 million vs. a loss of €39 million last year, driven by the aforementioned decline in EBITDA and higher financial expenses, partially offset by a larger share of profit from the equity accounted business.
EPC
EPC backlog at €6.8 billion (4% Y-o-Y decrease).
New orders in 2015 amounted to €2,453 million.
Main contracts awarded in Q4 2015: Transmission line and substation in Ecuador (€20 million). Oil and gas processing plant in Algeria (€71 million). Courthouse in Segovia, Spain (€12 million).
Concessions
Break up of Isolux Infrastructure completed at the beginning of May 2016 (see next page) Car Park business improving significantly its performance following the acquisition of mature new assets.
At the end of 2015 total car spaces in operation were above 28,000.
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Results Presentation FY 2015 | Key Developments
Corporate
Isolux Infrastructure (IIN) break up process:
Break up completed on May 3, 2016. Over 150 authorizations were obtained during the last 6 months.
Grupo Isolux Corsán is now the sole owner of the Brazilian and Indian transmission lines as well as T-Solar.
On top of receiving the assets, we collected USD98.5 million corresponding to the Adjustment Payment determined by a third party expert back in September, and adjusted by Leakage.
This amount was paid directly to the banks that factored this receivable in Q4 2015.
Restructuring process and Going Concern
The Company has started to conduct an analysis of its financial structure in order to adapt it to the current market conditions.
For that purpose it has hired Rothschild and Houlihan Lokey as advisors.
Given the above, the auditor's report on our annual accounts includes a going concern emphasis paragraph.
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Results Presentation FY 2015 | Key Developments
Isolux Corsán Group Key metrics by segment (in € MM, unless otherwise stated) FY 2014 FY 2015 Change
EPC 2,097 2,161 3%
Subtotal (before IFRS 11) 2,780 3,056 10%
Concessions 657 870 32%
Other and corporate 27 24 (11%)
Adjustments due to change in consolidation method(1) (652) (866) -
REVENUES
Total Consolidated 2,128 2,189 3%
FY 2014 FY 2015 Change
279 222 (20%)
620 653 5%
372 477 28%
(30) (46) -
(369) (477) -
EBITDA
252 176 (30%)
FY 2014
13%
22%
57%
n.a.
n.a.
EBITDA Margin
12%
FY 2015
10%
21%
55%
n.a.
n.a.
8%
(1) Equity method consolidation of Isolux Infrastructure and the Car park business
One off losses in Brazil, driven by country macro environment, compressed EPC EBITDA margin
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Results Presentation FY 2015 | Key Developments
Isolux Corsán Group Debt breakdown by segment (in € MM, unless otherwise stated)
Dec 31, 2015
Dec 31, 2014
EPC 124 158
Subtotal (before IFRS 11) 1,583 1,548
Concessions - 8
Corporate and other 1,459 1,382
Adjustments due to change in consolidation method(1) - -
Bank borrowings and Senior Notes
Total Consolidated 1,583 1,548
Dec 31, 2015
Dec 31, 2014
-
3,499
3,340
159
(3,250)
Project Finance(2)
249
Dec 31, 2015
Dec 31, 2014
163 248
507 631
332 339
13 45
(325) (325)
Cash and STFI
183 306
-
3,464
3,308
156
(3,243)
221
(1) Equity method consolidation of Isolux Infrastructure and the Car park business (2) Guarantees given from Grupo Isolux Corsán to Isolux Infrastructure to finance projects amounted to €171M as of December 31, 2014 and €104M as of December 31, 2015.
In addition to corporate debt as reported under IFRS the Group also has other financial indebtedness including project finance facilities and confirming lines
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(93)
(57)
(18)
162
(33)
(24)
(49)
123
(26)
(74) (59)
(95)
2013 2014 2015
Q1 Q2 Q3 Q4
Results Presentation FY 2015 | Key Developments
Cash flow from operating activities: seasonality
Q4 negative trend driven by delays in collections and reduction in payment instruments
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2. Business and Financial Highlights
i. EPC
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(1) Defined as New Orders / Revenue (2) From consolidated Cash Flow Statement which is a proxy to EPC & Other business segments.
EPC (in € MM, unless otherwise stated)
FY 2014
FY 2015
Change
New Orders
Backlog
Backlog for 3rd parties
3,344 2,453 (27%)
7,107 6,817 (4%)
84% 79% (5 p.p.)
Revenue 2,097 2,161 3%
Book to bill ratio(1) 1.6x 1.1x (0.5x)
EBITDA 279 222 (20%)
EBITDA Margin 13% 10% (3 p.p.)
Operating Cash Flow(2) 123 (95) -
Cash Flow from Investments(2) (48) 178 -
Robust backlog represents almost 3 years of activity. EBITDA margin includes negative one-offs from Brazil
Results Presentation FY 2015 | Business and Financial Highlights
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3.344
2.453
2014 2015
EPC - Key Financial Highlights
Key Figures EPC Segment (in € MM) Main developments
Brazil impacted not only EBITDA, but, in terms of revenues, has almost no contribution.
Armenia: 2 out of 3 segments of the North-South Corridor have been completed and opened to traffic.
India
Second high voltage transmission line, with a total length of 180km and 400kV voltage completed in the state or Karnataka.
New 66kV substation energized in Gurgaon.
Rewa Road Substation, the first 400 kV GIS substation in the state of Uttar Pradesh and part of the biggest transmission project in India (1530km) energized in October.
EPC Segment New Orders
y-o-y Backlog
y-o-y Revenue
y-o-y EBITDA
y-o-y
Growth (27%) (4%) 3% (20%)
New Orders Backlog Revenue EBITDA
7.107 6.817
2014 2015
2.097 2.161
2014 2015
279
222
2014 2015
Results Presentation FY 2015 | Business and Financial Highlights
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Spain 20%
Latam 50% Rest of
Europe 3%
Middle East and Africa
9%
North America
3% Asia 15%
Spain 14%
Latam 57%
Rest of Europe
2%
Middle East and Africa
10%
North America
4% Asia 13%
Energy 31%
T&D 27%
Infrastructure 42%
Energy 48%
T&D 20% Infrastructure
32%
EPC Revenue by activity
FY 2015
FY 2014
EPC Revenue by Geographic Area
FY 2015
FY 2014
86% International
€2,161 MM
€2,097 MM
80% International
Results Presentation FY 2015 | Business and Financial Highlights
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Middle East and
Africa 13%
Asia 15%
LATAM 49%
Rest of Europe
4%
Spain 13%
North America
6%
Middle East and
Africa 12%
Asia 15%
LATAM 53%
Rest of Europe
3%
Spain 13%
North America
4%
>250M 16%
100M-250M 35%
50M-100M 20%
10M-50M 21%
<10M 8%
>250M 20%
100M-250M 26%
50M-100M 23%
10M-50M 24%
<10M 7%
2014
Energy 21%
T&D 33%
Infrastructure 46%
3rd Parties
79%
Concessions Division
21%
Energy 24%
T&D 24%
Infrastructure 52%
2015
EPC Backlog by Segment EPC Backlog by Geographic Area
2015
2014
EPC Backlog Concentration
2015
2014
87% International
87% International
EPC Own Backlog
2015
2014
€6.8 Bn
€7.1 Bn
3rd Parties
84%
Concessions Division
16%
Results Presentation FY 2015 | Business and Financial Highlights
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2. Business and Financial Highlights
ii. Concessions
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2014 2015
Concessions - Key Financial Highlights
Key Figures Concessions (in € MM) Main developments
Revenue growth driven mostly by tariff review in transmission lines, as well as new assets in operation within toll roads
Transmission lines operating EBITDA decreased by 2% driven by FX in Brazil, partially offset by increased revenues from WETT.
Toll roads EBITDA has grown by 32% driven by the opening of NH6 and NH8 to traffic and increased contributions across the board with the exception or BR116.
Isolux Infrastructure and car parks accounted by the equity method
(1) Construction Revenue not included
Revenue 2015 (1) Revenue 2014 (1)
Revenue EBITDA
372
477
2014 2015
50% 30%
17%
3% Transmission lines
Toll roads
Solar
Car parks
+32% +40%
54% 28%
15%
3%
Results Presentation FY 2015 | Business and Financial Highlights
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Concessions Key financial metrics (in € MM, unless otherwise stated) FY 2014 FY 2015 Change
Transmission lines 263 296 12%
Isolux Infrastructure 509 574 13%
Toll roads 156 186 19%
Solar photovoltaic 90 93 3%
Revenues
Total Concessions 657 870 32%
FY 2014 FY 2015 Change
203 253 25%
369 449 22%
93 122 32%
73 74 1%
EBITDA
372 477 28%
FY 2014
77%
72%
60%
81%
EBITDA Margin
57%
FY 2015
86%
78%
66%
80%
55%
Car Parks 15 21 40% 5 27 440% 33% 129%
Toll roads
97%
3%
Total kilometres: 1,644
89%
11%
100%
Total MW: 286 Total spaces: 28,884
In operation Under construction
Other( inc. Construction revenue) 133 275 - (2) 1 - n.a. n.a.
Solar PV Car Parks Transmission lines
61%
39%
Total kilometres: 5,959
Results Presentation FY 2015 | Business and Financial Highlights
Of which, operating 122 119 (2%) 98 96 (2%) 80% 80%
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Location Asset Stake (1)
(%) Years to Maturity
Demand Risk
Revenue Mechanism(2)
Equity Invested(5) Net Debt(6)
LXTE 100% Availability Payment €126m €227m
LMTE 100% Availability Payment €136m €210m
CPTE 100% Availability Payment €15m €44m
IENNE 50% Availability Payment €38m €25m
JTE 33% Availability Payment €21m €17m
LTTE 100% Availability Payment €47m €48m
LITE 100% Availability Payment €4m €3m
UPTE 100% Availability Payment €116m €322m
T-Solar 88% Unlimited PPA(3)/ Feed in Tariff €239m €709m
BR116 90% Real Toll €127m €180m
NH1 61% Real Toll €49m €434m
NH2 (4) 50% Real Toll €17m €15m
NH6 (4) 50% Real Toll €24m €143m
NH8 (4) 50% Real Toll €28m €82m
CAMS 100% Real Toll €59m €329m
COPEXA 50% Real Toll €71m €252m
Ocaña A4 51% Shadow Toll €14m €37m
I 69 Section 5 51% Availability Payment €8m €86m
WETT 50% Unlimited Availability Payment €156m €280m
Concessions – Grupo Isolux Corsan’s Assets
Toll
-Ro
ads
Tran
smis
sio
n L
ine
s
(1) Stake held by Isolux Infrastructure (2) Revenues indexed to inflation. (3) PPA stands for Power Purchase agreement. (4) 50% stake owned in partnership with Morgan
Stanley Infrastructure Partners. (5) Isolux Infrastructure proportional Equity Invested
as of December 2015 (6) Isolux Infrastructure Net debt based on
Consolidation stake as of December 2015. Holdco Net debt was €59m
Sola
r
(Brazil)
(India)
(Mexico)
(Spain)
(USA)
(Brazil)
(India)
(USA)
2013
2004
2013
2013
2007
2009
2012
2013
2010
2009
2010
2015
23
23
17
23
22
26
28
33
19
9
25
13
12
39
38
11
36
Results Presentation FY 2015 | Business and Financial Highlights
2015
TL
Operational & under construction
Under construction
Start of operations
Assets going to PSP
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3. Cash flow and debt overview
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172
294
(95)
(202)
(4)
178
Cash and cashequivalents Sep 2014
Cash and cashequivalents Dec 2014
Operating Cash Flow2015
Cash Flow from Investingactivities 2015
Cash Flow from FinancingActivities 2015
FX Cash and cashequivalents Dec 2015
Consolidated Cash Flow Bridge December 2014 to December 2015 (in € MM)
Cash Flow Bridge
Results Presentation FY 2015 | Cash flow and debt overview
Cash from operations(1)
: €154M Working capital: €(249M)
(1) Cash from operations including profit (loss) for the year and after taxes paid
STFI €15M
STFI €13M
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5 112 87 71
270
44 19
40 12
833
69
21 1
2016 2017 2018 2019 2020 From 2021 onwards
Term loans Advanced credit debts Senior notes Credit lines Finance lease liabilities
Corporate debt maturities as of December 31, 2015(1): breakdown by type of debt (Total €1,583 MM)
Debt Maturities
Over 85% of our corporate debt maturities are long term
(1) Senior Notes in accordance with IFRS, at amortized cost
2016 2017 2018 2019 2020 From 2021 onwards
Results Presentation FY 2015 | Cash flow and debt overview
234
109 73
852
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4. Appendix
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Results Presentation FY 2015 | Appendix
FY 2014
FY 2015
Borrowings(1) 1,548 1,583
Cash & STFI (before IFRS 11) 631 507
Net Corporate Debt 916 1,076
LTM EBITDA 252 176
LTM Distributions from concessions 14 192
LTM Adjusted EBITDA 276 368
Net Corporate Leverage(3) 3.3x 2.9x
(1) The relevant bondholders’ perimeter figure would also include Project finance (€214 MM) and Real Estate (€18 MM) for FY 2014 and Project finance (€249 MM), Real Estate (€14 MM) for FY 2015 (2) Includes indemnities and redundancy costs mainly related to headcount restructuring in our Spanish construction business (3) Covenant test to be performed as of December 31, 2015 .
Isolux Corsán Group (in € MM, unless otherwise stated)
Others(2) 10 -
Corporate leverage as per bank covenant definition
Financial indebtedness: • Corporate debt- €1,583m • Infinita - €159m • Confirming - €268m
Total - €2,010m
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Results Presentation FY 2015 | Appendix
Detailed Financial Statements - Consolidated Balance Sheet by segment
Consolidated Balance Sheet (in million €)
Property, plant and equipment 81 0 31 113 - 113 45 0 31 76 - 76
Investments in associates and joint ventures - (0) - (0) 974 974 - - - - 127 127
Other non-current assets 619 5,048 364 6,030 (4,963) 1,067 623 5,220 370 6,213 (5,173) 1,040
Total non current assets 700 5,048 395 6,143 (3,989) 2,154 668 5,220 401 6,289 (5,046) 1,243
Inventories 135 25 101 261 (7) 253 116 26 105 248 (5) 243
Accounts receivable 2,651 312 (774) 2,189 (341) 1,847 3,131 184 (929) 2,385 (303) 2,083
Derivative financial instruments 2 - 0 2 - 2 0 7 - 7 (7) 0
Financial assets 11 25 3 39 (25) 15 12 49 2 62 (49) 13
Cash and cash equivalents 236 314 41 592 (301) 291 151 283 11 445 (276) 169
Non-current assets held for sale - - 380 380 - 380 - - 381 381 947 1,327
Total current assets 3,035 676 (249) 3,462 (674) 2,788 3,410 549 (431) 3,528 308 3,836
Total assets 3,735 5,724 146 9,605 (4,663) 4,942 4,078 5,769 (30) 9,817 (4,738) 5,078
Borrowings 158 8 1,382 1,548 - 1,548 124 - 1,459 1,583 - 1,583
Project finance - 3,308 156 3,464 (3,243) 221 - 3,340 159 3,499 (3,250) 249
Liabilities held for sale - - 173 173 - 173 - - 167 167 254 421
Accounts payable 2,505 556 (294) 2,767 (412) 2,355 2,872 510 (445) 2,936 (456) 2,481
Other liabilities 196 915 51 1,162 (882) 280 188 1,191 9 1,387 (1,161) 226
Total liabilities 2,859 4,787 1,467 9,113 (4,536) 4,577 3,184 5,040 1,348 9,572 (4,613) 4,959
December 31, 2015
EPC ConcessionsOther and
corporateSub-Total
Change in
consolidation
method
Total
Consolidated
December 31, 2014
Sub-Total
Change in
consolidation
method
Total
ConsolidatedEPC Concessions
Other and
corporate
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Detailed Financial Statements - Consolidated Income Statement by segment
Results Presentation FY 2015 | Appendix
Consolidated Income Statement (in million €)
Segment's ordinary revenue 2,097 657 27 2,780 (652) 2,128 2,161 870 24 3,056 (866) 2,189
Other 16 - 0 17 (11) 6 16 26 (1) 40 (26) 14
Total operating income 2,113 657 27 2,797 (663) 2,134 2,177 896 23 3,096 (892) 2,204
Other operating expenses (1,834) (285) (58) (2,177) 294 (1,883) (1,955) (419) (69) (2,443) 415 (2,028)
EBITDA 279 372 (30) 620 (369) 252 222 477 (46) 653 (477) 176
Depreciation, amortization and impairment losses (19) (87) (27) (133) 91 (41) (29) (97) (17) (142) 101 (41)
Change in trade provisions (21) 0 (24) (45) - (45) (8) 0 (16) (25) - (25)
Operating results 240 285 (82) 443 (277) 166 184 381 (79) 486 (376) 110
Net financial results (13) (264) (171) (448) 243 (206) (47) (293) (174) (515) 278 (236)
Equity method - - - - 26 26 - - - - 43 43
Profit before income tax 226 21 (253) (5) (8) (13) 137 88 (253) (28) (55) (84)
Income tax - - (31) (31) 12 (19) - - (16) (16) 54 38
Results for the period from continuing operations 226 21 (284) (36) 4 (33) 137 88 (269) (44) (1) (45)
Results for the period from discontinuing operations - - (9) (9) - (9) - - (10) (10) - (10)
Results for the period 226 21 (293) (46) 4 (42) 137 88 (279) (55) (1) (56)
Attributable to:
Owners of the parent - - - (39) - (39) - - (52) (52) - (52)
Non-controlling interests - - - (7) 4 (3) - - (3) (3) (1) (4)
FY 2014
EPC ConcessionsOther and
corporateSub-Total
Change in
consolidation
method
Total
Consolidated
FY 2015
EPC ConcessionsOther and
corporateSub-Total
Change in
consolidation
method
Total
Consolidated
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Detailed Financial Statements – Consolidated Cash Flow Statement
Results Presentation FY 2015 | Appendix
Consolidated Cash Flow (in million €) FY 2014 FY 2015
Profit/(loss) for the period before taxes (25) (97)
Adjustments for non-cash items 269 266
Changes in working capital (109) (249)
Taxes paid (11) (15)
Net cash generated from /(used in) operating activities 123 (95)
Purchase of PP&E and intangible assets (18) (15)
Acquisition of concessionary assets and non-current assets assigned to projects (16) (25)
Advances from divestments in joint ventures - 216
Other capex, net (15) 3
Net cash used in investing activities (48) 178
Proceeds /(Reimbursement) of Corporate debt, net (671) 1
Proceeds /(Reimbursement) of Project finance, net 6 9
Proceeds from issuance of Senior Notes 840 -
Interest paid (209) (212)
Net cash flows generated from /(used in) financing activities (34) (202)
March 5th 2015 | 27
225
131
131
196
48
48
178
178
178
234
234
234
243
203
0
235
138
27
129
5
5
Thank you
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