Elia group full year results 2013

Full year 2013 results
Analyst meeting
Brussels, 28 February 2014

Disclaimer
- This presentation is only provided for general information purpose about Elia and its
activities. The included statements are neither reported results nor other historical
information. They are not provided to serve as the basis for any evaluation of Elia, and
cannot be binding and/or enforceable upon Elia.
- As forward-looking statements, they are subject to assumptions, risk and uncertainties,
actual future results may differ from those expressed in or implied by such statements.
- Although Elia uses reasonable cares to present information which is up-to-date to the
best of Elia's knowledge, Elia makes no representation or warranty whatsoever as to
the adequacy, accuracy, completeness or correctness of such information.
- Elia will not be liable for any consequences arising from or related to the use or
interpretation of the information contained or absent in this presentation.

Elia Group full year results 2013 / Brussels, 28.2.2014

2 / 30

1.eghts 2013
• Key highlights 2013
• Operational highlights
• Financial results
• Outlook 2014

Key highlights 2013
Operational
• Adjusted transmission tariffs for Elia have been approved by the CREG
• Nearly full realization of ambitious investment plans in both countries
• Continuity of supply maintained during winter season in both areas
Financial
• Good results for the Group:
• Significant increase results 50Hz transmission
• Lower results for Elia transmission due to low Belgian OLO
• Proposed dividend of €1,54 per share
• New consolidation method for 50Hertz used as from 2014
Outlook
• Establishment of new entity by Elia and 50Hertz to reinforce the position of the Elia Group for asset
and share deals, by scouting for such deals and developing two lines of businesses: Consulting &
Services and EPC/EPCM projects
• Regulatory status of play
• Investment programme for the Elia Group
• Changing government in Germany results in changing energy policy?
• Decisions federal government Belgium relating to the energy law


5 / 30

Energy consumption
9,0
8,0

Elia’s network: 80,5 TWh
(81,7 TWh)

7,0

TWh

6,0

• Mild weather
• Decentralised generation

5,0
4,0
3,0
2,0
1,0
0,0
jan

6,0

feb

mar

apr

may june july
2010
2011

aug sep
2012

oct

nov

dec

50Hertz’s network: 58,1 TWh
(58,2 TWh)

5,0
4,0
TWh

3,0
2,0
1,0
0,0
jan

feb

mar

apr may june july
2010
2011

aug sep
2012

oct

nov

dec

• Mild weather
• Decentralised generation
• Renewables

(1) The Elia consumption indicator covers the majority of electricity consumption.
It includes all production directly connected to the Elia grid plus net import-export balance


7 / 30

Import - export

Denmark
1,2 TWh

4,4 TWh

2,5 TWh

Netherlands
0,5 TWh

7,8 TWh

Poland

Hamburg
Berlin

27,9 TWh

5,4 TWh

8,8 TWh

2,4 TWh

0,7 TWh

France

Luxembourg
8,8 TWh
0,8 TWh

1,4 TWh

Czech Republik
2,4 TWh

•

Significant imports in Belgium due to continued outages of nuclear plants up to
June 2013

•

The increased RES share within control zone 50Hertz results in important exports


8

8 / 30

Elia group: Investments
50Hertz

Elia

2%
3%

11%

6%

14%

€ 202,7 M

€ 402,0 M

43%

1%
€ 247,7 M onshore
€154,3 M offshore

31%
89%

Replacements

Internal consumption

Interconnections

Integrating renewables

Non electrical investments

•

Investments in Belgium are mainly driven by replacements and the internal
consumption.

•

In Germany, the integration of renewables is by far the most important driver.


9 / 30

Elia-TSO: Major investments
Large Infrastructure
projects
• BRABO
• Reinforcement around port of
Antwerp and increased capacity
with the Netherlands
• Permit process ongoing
• Expected commissioning 2017-2018

• ALEGRO

Extension CAPEX driven by
integration of renewables &
localisation of generation
• Increasing renewables onand offshore need to be
integrated
• Localization of the power
plants change

• HVDC interconnection with
Germany
• Increased market liquidity, reliability
and security of supply
• Walloon government adopted the
draft revision of the sector plan
• Expected commissioning 2019


Replacement
CAPEX
• Mostly investments in
the high and low
voltage substations

• Phase out of old
population of assets
commissioned before
1980’s

Extension CAPEX
driven by internal
consumption
• Investments due to the
change in profile of the
power needs, even if
energy has decreased
over time,
• Delocalization of the
electricity needs

10 / 30

50Hertz: Major Investments
BALTIC 2
• Connection of 288
MW offshore wind
park under
construction
• 3 cables, spanning
120km offshore
and 16 km onshore
• Expected to
become
operational in 2014

SOUTH-WEST
CONNECTOR

BARWALDE SCHMOLLN

• Section Vieselbach
– Altenfeld :
under construction

• Under construction

• Section Altenfeld –
Redwitz:
Plan approval in
preparation
• Decision expected
3rd quarter 2014


• Innovative
construction
method minimizing
costs
• Expected to
become
operational in
autumn 2014

UCKERMARKLINE
& BERLIN NORTH
RING

SOUTH-EAST DC
PASSAGE

• Plan approved on
first section Berlin
North Ring

• Project necessity
defined and legally
approved

• Other section and
Uckermarkline in
ongoing plan
approval phase

• Part of German
Grid Need Act

• Decisions
expected in 2014

• Joint project with
Amprion (450 km)
• Preparation of
regional planning

11 / 30

Corporate structure and shareholders’ structure
Publi-T
45.22%

Free float1
52.26%

Publipart
2.52%

Eurogrid International
CVBA
60.00%

Elia System Operator NV

Elia Asset NV
99.99%

Ampacimon
36.81%

Elia Engineering
100%

Elia Re
100%

CASC
8.33%

HGRT
24.50%

Coreso
22.49%

APX
29.02%

Eurogrid GmbH
100%

E offshore A
LLC
100%

Gridlab GmbH
100%

50Hertz
Transmission
100%

EEX
2.25%

CAO
12.50%

Coreso
10.00%

EMCC
20.00%

Atlantic Grid
Investment A
Inc. - 100%

50Hertz
Offshore
100%

Atlantic Grid A
Interm. Holdco
10.00%
Atlantic Grid A
Operational
Holdco

Main change is the new participation of 50Hertz in the European Energy
Exchange (EEX)

13 / 30

Elia group : consolidated key figures
(in € Mio)

2013

2012

1.389,5

1.306,6

6,3%

EBITDA

486,9

455,5

6,9%

(R)EBIT

345,4

305,4

13,1%

Total revenues

Finance result

(108,5)

(134,8)

-19,5%

Taxes

(61,5)

(16,2)

•
•

2013

56
%

2012
42
%

44
%

58
%

279,6%

Net profit

•
•

Net profit

Change

175,8

155,0

13,4%

Elia

50Hertz

Positive evolution in EBIT(DA) due to improved EBITDA in both 50Hertz and Elia
Finance result positively impacted by lower interest charges in Belgium and a
change in discounting of auction revenues in Germany
Taxes mainly increase due to the 2012 one-off effect in the figures of Elia
Increase in the net profit of 13,4% to € 175,8 M as a result of the significant
increase in Germany, partly compensated by the decrease in Belgium


14 / 30

Elia: 2013
Regulated returns
5,96%

(in € Mio)

2013

Total revenues

832,7

2012
770,1

Change

100
80

8,1%

209,3

291,6
188,6

7,6%
11,0%

In € Mio

(R)EBIT

313,9

60

(109,2)

(117,5)

-7,1%

2,1
7,7

6,3
16,1

16,2

4,21%

40

Net profit

•
•
•

(23,4)
77,1

17,5
89,2

-233,7%
-13,6%

13,5

53,5

63,8

20

5,3
6,9
19,3

2,98%
2,43%
51,6

0
-10

5,17%

3,44%

10

Taxes

0,1
3,8
8,2

50
30

Finance result

5,35%

90
70

EBITDA

5,59%

2010

-1,5

2011

Fair remuneration
Incentive efficiency
Other
OLO

44,5
-0,4
2012

2013

Goodwill
Incentive CAPEX
ROE

Total revenues, EBIT(DA) and taxes are impacted by the one-off effect in 2012 from the recognition of
the deferred tax benefit on the transferable notional interest deduction reserve
Finance result down mainly due to lower interests to be paid on the loan with floating interest rates
Regulated profit (€ 75,6 Mio) fairly in line with 2012 (- 2,1%), net profit negatively impacted by the
important discount effect of the recoverable pension cost last year


15 / 30

Elia: 2013
Net profit evolution 2012 - 2013

Regulated asset base
2013

1,5
(7,1)

5,8

(0,9)

(1,2)

3.935,1

Other

- 17,3

(4,7)

Goodwill decomissioning
Changes in WC
(10,1)

4,6

Depreciations
New investments

89,2
77,1

2012
2011
2010

- 23,3
62,5
- 96,8
202,7

3,807,3
3,763,0
3.743,3
In € Mio

•
•

Results are still suffering from low long term Belgian interest rate (2,43% in 2013 vs. 2,98% in
2012), partly compensated by higher goodwill decommissioning
Negative effect from the recoverable pension cost is due to the important discount effect in 2012


16 / 30

50Hertz: 2013
Dividend yield
(in € Mio)

2013

2012

45

Change

40

557,6

539,4

3,4%

EBITDA

173,1

163,9

5,6%

(R)EBIT
Finance result

136,1
0,7

116,8
(17,5)

16,5%
-104,0%

35
In € Mio (60%)

Total revenues

15,24%

30
25
20

13,06%
11,01%
36,4

42,5

30,7

15
10

Taxes
Net profit

(38,2)
98,7

(33,6)
65,8

13,7%
50,0%

5
0
2011

2012

Dividend

•
•

2013

Yield

Increased EBIT(DA) mainly a result from the increased cost recovery for investments, both in the
old (T-2) and new system (T-0)
Finance result positively impacted by discounting of auction revenues


17 / 30

50Hertz: 2013
Net profit evolution 2012 -2013 (1)

Regulated asset base (1)
2013

5,4

(7,2)

3.064,0

3,0
22,0

Other

14,3

Changes in WC
18,9 (14,7) 20,9
15,8
(15,4)

Depreciations

166,4

New investments

14,7

-313,4
-92,4
402,0

110,7
2012
2011

3.045,4
2.699,9
In € Mio

•

•

Net profit mainly boosted by the increased cost recovery for investments, lower regulatory risk
provisions and the discounting of auction revenues, partly offset by no EEG bonus and lower
result on the Korridor model
Regulated asset base growing with the important investments, however offset to a large extent by
the improving EEG prefinancing position

(1) Numbers are based on 100% of 50Hertz


18 / 30

Elia Group: Consolidated key figures
Debt
155,3

In € Mio

495

4
60

60
495
298

298

Maturity

Short term
borrowings 50Hertz
EIB Elia

16,1%

Within 3 - 5 y

Shareholder loan

After 5 y

Eurobond 50Hertz
1.997,6

2012

•
•
•

2.244,0

Eurobond Elia

Within 1 y

18,0%
65,9%

2013

Debt within Elia increased due to the refinancing of the € 500 Mio Eurobonds with the new € 550
Mio (15 y) and € 200 Mio (20y) Eurobonds.
Short term borrowings decreased significantly within 50Hertz as a result of the positive evolution
on the prefinancing of the EEG mechanism
Maturity profile improved significantly with the new Eurobonds. In 2014, a € 500 Mio bond is
coming to maturity


19 / 30

Elia Group: Consolidated key figures
(in € Mio)

2013

2012

Net debt

2.773,8

2.910,8

Long Term:

A-

Leverage (D/D+E)

55,31%

57,99%

Outlook:

Stable

REBITDA/Gross
Interest

3,96

3,08

Net debt / REBITDA

5,61

6,39

Average cost of debt

3,94%

4,93%

% fixed of gross debt

84,37%

83,89%

Standard & Poor’s rating Elia Group:

•
•
•

Moody’s rating German segment:
Long Term:
Baa1
Outlook:

Stable

Decrease in net debt is mainly a result of the significant improvement in the prefinancing of the
EEG mechanism by 50Hertz
Average cost of debt decreased thanks to the replacement of the Eurobond and low interest
charges that were due on the floating interest loan
Ratings were again confirmed for both Elia and 50Hertz


20 / 30

Elia Group: Dividend policy
CAGR = 2,22%

€ / share

1,38

1,40

1,47

1,47

1,54

79,3%
68,4%

64,5%

57,4%

53,1%

2009
Total amount
paid out (€m)

2010

2011

2012

2013

66,6

84,5

88,7

89,0

93,3

Dividend

Pay-out ratio

Proven track record of growing dividend over time, with a compound annual growth rate
of 2,22%

21 / 30

Impact changed method of consolidation for 50Hertz
as of 2014
Proportionate
consolidation

Equity pick-up

Change

Total revenues

1.389,5

832,7

(556,8)

EBITDA

487,0

313,9

(173,1)

(R)EBIT

345,4

209,3

(136,1)

Finance result

(108,5)

(109,2)

(0,7)

Taxes

(61,5)

(23,4)

38,2

Share of profit of equity accounted
investees

0,3

98,7

98,7

Net profit

175,8

175,8

0,0

Total assets

6.532,2

5.555,7

(976,5)

Net financial debt

2.733,9

2.628,4

(105,5)

• No impact on S&P rating – consistently consolidating 50Hertz at 100%
• Due to mechanical adjustment, ratio’s will look slightly worse. However no impact on
financing as both Elia and 50Hertz are strictly ringfenced

22 / 30

Regulatory state of play
Belgium
• CREG wants to formulate a new tariff methodology by the end
of 2014, including a framework for the offshore investments
• A draft methodology will be issued by the CREG in June 2014
• Consultation round will be organized by the CREG from June
up to the fall of 2014
• Afterwards the CREG will issue a new tariff methodology by the
end of the year which will be used for the period 2016-2020
Germany
• New tariff period has started as from 1 January 2014
• Positive changes in the Korridor model


24 / 30

Elia Group: Investments 2014
Elia

50Hertz
5%
3%3%

13%
35%

€ 252,5 M
26%

€ 505,2 M
€ 257,9 M onshore
€ 247,3 M offshore

2%
24%
89%
Replacements
Interconnections
Non electrical investments

Internal consumption
Integrating renewables

•

Integrating renewables and investments due to generation localization are becoming
more important in Belgium.

•

In Germany, investments increase year-over-year with 25,7%, mainly driven by the
offshore connections


25 / 30

Elia TSO – main investment projects
1 Stevin
2 Belgian Offshore Grid
3 Nemo - HVDC Connection UK
4 Brabo
5 Allegro – HVDC Connection Belgium-Germany
6 East Loop reinforcement
7 Interconnection BE-Lux
8 Reinforcement Avelgem

• Auditor of the Council of State issued negative advices on the Flemish Regional Spatial
Plan, which includes the approval of the Stevin project
• Possible repercussions on Belgian Offshore Grid and Nemo

26 / 30

50Hertz – main investment projects
11

3

Existing grid
Planning procedure
Approval procedure
Under construction
Completed

10
1
1

Power Plant
Substation
(50Hertz)
Substation
(not 50Hertz)

9 1

3 Offshore connection Baltic 2
4 South-West interconnector
5 Grid connection UW Förderstedt

8

7
1

12

2 Bärwalde – Schmölln

Fertig gestellt

1
1

1 Completed projects in 2013 and 2012

6 3rd interconnector to Poland
7 380-kV-Nordring Berlin

1

6

5

8 Uckermark-line Neuenhagen – Bertikow
9 Bertikow – Pasewalk

1
4
1


2

10 Offshore connections in Baltic Sea
11 Combined Grid Solution
12 Wolmirstedt – Perleberg

27 / 30

Belgium: Proposed changes in the Energy law
Developments in the changing energy environment give rise to
proposals from the legislator on adapting the energy law. Main
topics of those resolutions:

-

Plan Wathelet:

Installed capacity non-profiled units
14000

- 3.100 MW

12000

To further ensure the security of supply, the plan is introducing

10000

consultation about the needed volumes and activation of the
strategic reserves

MW

the concept of strategic reserves. Role of Elia : yearly

Max

8000

Min

6000
4000
2000

-

Change in corporate governance rules Elia

0
January 2014

2014/2015

2015/2016

2016/2017

Composition of the different committees advising the Board of
Directors will be changing

-

Offshore

- Support mechanism for new wind farms has been decided upon
- Elia will be granted the right to ask for the concession to
construct the offshore platforms.


28

28 / 30

Germany: Main outline of the proposed amendment
of the Renewable Energies Act (EEG)

-

RES share of electricity consumption to be between 40%
and 45% by 2025 and between 55% and 60% by 2035
(previously minimum targets were set: 2020 35%; 2030
50%)
A binding corridor for the deployment of renewables
energies

-

Offshore wind target: 6.5 GW by 2020 (previously 10
GW by 2020)

-

20,36
20
13,53

15
10
5

8,33

3,530

3,592

2011

2012

6,240

14,11
5,277

2,047

0
2010

2013

2014

Feed-in tariffs remain method of choice, mechanisms
for quantitative expansion control to be introduced by
2018 (tenders to be tested for large solar power systems
by 2016)

-

23,58

Mandatory “market premium” with sliding premium for
new RES plants

Costs

EEG surcharge

Line of attack of the Energiewende remains unchanged.

29 / 30

EEG surcharge [ct/kWh]

-

25
Costs [Bn. €]

Until now only key parameters have been established.
The legislative process has not yet started. Entry into
force is foreseen for August 2014.

Questions & Answers
Tom Schockaert
Investor Relations
+32 (0)2/546.75.79
tom.schockaert@elia.be
www.eliagroup.eu

Follow Us
http://www.twitter.com/eliacorporate

http://www.facebook.com/eliacorporate

http://www.linkedin.com/company/elia

Brussels, 28.2.2014

Elia group full year results 2013

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Viewers also liked

Viewers also liked (8)

Similar to Elia group full year results 2013

Similar to Elia group full year results 2013 (20)

More from Elia

More from Elia (6)

Recently uploaded

Recently uploaded (20)

Elia group full year results 2013