UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of August, 2020
Commission File Number 001-36487
Atlantica Sustainable Infrastructure plc
(Exact name of Registrant as specified in its charter)
Not applicable
(Translation of Registrant’s name into English)
Great West House, GW1, 17th floor
Great West Road
Brentford, TW8 9DF
United Kingdom
Tel: +44 203 499 0465
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
☒ Form 20-F | ☐ Form 40-F |
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
This Report on Form 6-K is incorporated by reference into the Registration Statement on Form F-3 of the Registrant filed with the Securities and Exchange Commission on August 6, 2018 (File 333-226611).
Q2 2020 Earnings PresentationAugust 3, 2020
DISCLAIMER Forward Looking StatementsThis presentation contains forward-looking statements. These forward-looking statements include, but are not limited to, all statements other than statements of historical facts contained in this presentation, including, without limitation, those regarding our future financial position and results of operations, our strategy, plans, objectives, goals and targets, future developments in the markets in which we operate or are seeking to operate or anticipated regulatory changes in the markets in which we operate or intend to operate. In some cases, you can identify forward-looking statements by terminology such as "aim," "anticipate," "believe," "continue," "could," "estimate," "expect," "forecast," "guidance," "intend," "is likely to," "may," "plan," "potential," "predict," "projected," "should" or "will" or the negative of such terms or other similar expressions or terminology.By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements speak only as of the date of this presentation and are not guarantees of future performance and are based on numerous assumptions. Our actual results of operations, financial condition and the development of events may differ materially from (and be more negative than) those made in, or suggested by, the forward-looking statements. Except as required by law, we do not undertake any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of anticipated or unanticipated events or circumstances.Investors should read the section entitled "Item 3D. Key Information—Risk Factors" and the description of our segments and business sectors in the section entitled "Item 4B. Information on the Company—Business Overview", each in our annual report for the fiscal year ended December 31, 2019 filed on Form 20-F, for a more complete discussion of the risks and factors that could affect us.Forward-looking statements include, but are not limited to, statements relating to: expected amounts, payments and closing timelines for investments; business synergies from investments; project growth strategy; accretive investment opportunities; strategic business alternatives to ensure optimal company value; estimated returns and cash available for distribution (“CAFD”) estimates, including from project debt refinancing; net corporate leverage based on CAFD estimates; debt refinancing; ESG initiative improvement; the quality of our long-term contracts; self-amortizing project debt structure and related debt reduction; the use of non-GAAP measures as a useful predicting tool for investors; the possibility to extend asset life; cost improvements from debt refinancing; the impact of COVID-19 and the ongoing economic crisis; dividends; and various other factors, including those factors discussed under “Item 1.A—“Risk Factors” in our Quarterly Report for the six-month period ended June 30, 2020 furnished on Form 6-K on the date hereof and “Item 3.D—Risk Factors” and “Item 5.A—Operating Results” in our Annual Report for the fiscal year ended December 31, 2019 filed on Form 20-F.The CAFD and other guidance incorporated into this presentation are estimates as of February 27, 2020. These estimates are based on assumptions believed to be reasonable as of the date Atlantica published its FY 2019 Financial Results. Atlantica disclaims any current intention to update such guidance, except as required by law.Non-GAAP Financial Information This presentation also includes certain non-GAAP financial measures, including Adjusted EBITDA including unconsolidated affiliates, Adjusted EBITDA including unconsolidated affiliates as a percentage of revenues (margin) and CAFD. Non-GAAP financial measures are not measurements of our performance or liquidity under IFRS as issued by IASB and should not be considered alternatives to operating profit or profit for the period or any other performance measures derived in accordance with IFRS as issued by the IASB or any other generally accepted accounting principles or as alternatives to cash flow from operating, investing or financing activities. Please refer to the appendix of this presentation for a reconciliation of the non-GAAP financial measures included in this presentation to the most directly comparable financial measures prepared in accordance with IFRS as well as the reasons why management believes the use of non-GAAP financial measures in this presentation provides useful information.In our discussion of operating results, we have included foreign exchange impacts in our revenue and Adjusted EBITDA including unconsolidated affiliates by providing constant currency growth. The constant currency presentation is not a measure recognized under IFRS and excludes the impact of fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our results of operations. We calculate constant currency amounts by converting our current period local currency revenue and Adjusted EBITDA using the prior period foreign currency average exchange rates and comparing these adjusted amounts to our prior period reported results. This calculation may differ from similarly titled measures used by others and, accordingly, the constant currency presentation is not meant to substitute for recorded amounts presented in conformity with IFRS as issued by the IASB nor should such amounts be considered in isolation.
Key Messages Adjusted EBITDA including unconsolidated affiliates includes our share in EBITDA of unconsolidated affiliates (see reconciliation on page 29).This amount includes the ~$143 million of one-off cash generated in the second quarter 2020 referred to above. Adj. EBITDA incl. unconsolidated affiliates1 decreased by 7.4% mostly due to FX and lower solar radiation in EMEA No material impact from COVID-19 situation as of today; health and safety remains our first priority Continued executing on accretive growth strategyRaised a total of $489 million2 for growthExercised option to buy out Solana’s tax equity investor. Closing expected in August, subject to customary conditionsClosed the acquisition of Chile PV I, a 55MW solar asset through the Renewable Energy Platform created in Chile 3% year-over-year CAFD growth in H1 2020 up to $97.3 million Q2 2020 dividend of $0.42 per share Additionally generated ~$143 million of one-off cash through a non-recourse refinancing in Q2 to finance growth
1. Financial Results Sustainable Infrastructure
First Half US $ in millions 2020 2019 ∆ Reported ∆ Excluding FX impact Revenue 465.7 504.8 (7.7)% (6.1)% Adjusted EBITDA incl. unconsolidated affiliates1 380.1 410.5 (7.4)% (5.5)% Margin2 82% 81% CAFD 97.3 94.5 +2.9% Cash generation fromproject debt refinancings in the period 143 HIGHLIGHTS+3% CAFD Growth in H1 2020 Adjusted EBITDA including unconsolidated affiliates includes our share in EBITDA of unconsolidated affiliates (see reconciliation on page 29).Adjusted EBITDA Margin including unconsolidated affiliates is defined as Adjusted EBITDA including unconsolidated affiliates divided by revenue (see reconciliation on page 31).
WATER H1 2020 H1 2019 ∆ 15.6 11.9 +31% 12.9 11.2 +15% 83% 94% RENEWABLES H1 2020 H1 2019 ∆ 344.7 380.1 (9)% 275.1 301.4 (9)% 80% 79% EFFICIENT NATURAL GAS H1 2020 H1 2019 ∆ 52.0 61.7 (16)% 47.8 54.3 (12)% 92% 88% TRANSMISSION H1 2020 H1 2019 ∆ 53.4 51.1 +5% 44.3 43.6 +2% 83% 85% By Sector US $ in millions Revenue Adjusted EBITDA incl. unconsolidated affiliates1 Margin2 EMEA NORTH AMERICA H1 2020 H1 2019 ∆ 157.9 164.5 (4)% 142.6 147.2 (3)% 90% 89% SOUTH AMERICA H1 2020 H1 2019 ∆ 232.8 271.2 (14)% 177.7 205.8 (14)% 76% 76% By Region US $ in millions Revenue Adjusted EBITDA incl. unconsolidated affiliates1 Margin2 Adjusted EBITDA including unconsolidated affiliates includes our share in EBITDA of unconsolidated affiliates (see reconciliation on page 29).Adjusted EBITDA Margin including unconsolidated affiliates is defined as Adjusted EBITDA including unconsolidated affiliates divided by revenue (see reconciliation on page 31). H1 2020 H1 2019 ∆ 75.0 69.1 +9% 59.8 57.5 +4% 80% 83% HIGHLIGHTSPerformance by Sector and Region
Includes curtailment in wind assets for which we received compensation.Represents total installed capacity in assets owned at the end of the period, regardless of our percentage of ownership in each of the assets.GWh produced in the first half of 2020 includes 30% production from Monterrey since August 2019. Major maintenance overhaul in ACT held in Q1 and Q2 2019, as scheduled, which reduced production and electric availability as per contract. Electric availability refers to operational MW over contracted MW.Includes 43MW corresponding to our 30% share of Monterrey since August 2, 2019.Availability refers to actual availability divided by contracted availability. WATER RENEWABLES TRANSMISSION EFFICIENT NATURAL GAS H1 2020 H1 2019 Availability6 102.0% 100.6% Mft3 in operation2 17.5 10.5 H1 2020 H1 2019 GWh produced1 1,482 MW in operation2 1,551 1,496 H1 2020 H1 2019 GWh produced3 1,268 Electric availability4 101.7% 88.5% MW in operation5 343 300 H1 2020 H1 2019 Availability6 99.9% 100.0% Miles in operation 1,166 1,152 1,651 866 KEY OPERATIONAL METRICSSteady Operational Performance
Adjusted EBITDA including unconsolidated affiliates includes our share in EBITDA of unconsolidated affiliates (see reconciliation on page 29).Includes proceeds for $7.4 million and $14.8 million for the six-month period ended June 30, 2020 and June 30, 2019 respectively, related to the amounts received by Solana in relation to the consent with the DOE. Consolidated cash as of June 30, 2020 increased by $226.0 million vs December 31, 2019 including FX translation differences of $(11.1) million. First Half Second Quarter US $ in millions Q2 2020 Q2 2019 H1 2020 H1 2019 Adjusted EBITDA incl. unconsolidated affiliates1 214.1 229.3 380.1 410.5 Share in Adjusted EBITDA of unconsolidated affiliates (4.0) (2.0) (7.5) (4.1) Net interest and income tax paid (119.5) (129.4) (131.0) (143.3) Variations in working capital (24.7) (37.4) (84.0) (91.9) Non-monetary adjustments and other (3.2) (8.3) (9.2) (22.1) OPERATING CASH FLOW 62.7 52.2 148.4 149.1 INVESTING CASH FLOW2 17.6 (97.1) 16.8 (119.4) FINANCING CASH FLOW 12.1 (39.8) 71.9 (84.4) Net change in consolidated cash3 92.4 (84.7) 237.1 (54.7) CASH FLOWIncreasing Operating Cash Flow
NET DEBT POSITION1 Net debt corresponds to gross debt including accrued interest less cash and cash equivalents.Corporate Net Debt defined as indebtedness where Atlantica Sustainable Infrastructure plc. is the primary obligor minus cash and cash equivalents held at Atlantica Sustainable Infrastructure plc. Project Net Debt is defined as indebtedness where one of our subsidiaries is the primary obligor minus cash and cash equivalents held by one of our subsidiaries.Net corporate leverage calculated as corporate net debt divided by midpoint 2020 CAFD guidance before corporate debt service. US $ in millions As of Jun. 30,2020 As of Dec. 31,2019 Corporate Net Debt2 558.3 657.8 Project Net Debt3 4,497.5 4,355.6 NET DEBTConservative Corporate Leverage Corporate net debt / CAFD pre corporate debt service4 2.3x
2. Strategic Update Sustainable Infrastructure
GROWTH STRATEGYRaised over $400 million for growth Exercised Solana option. Closing expected in AugustClosed Chile PV IOther opportunities Weighted average cost of new financings and refinancings closed in 2020. Average cost of new financings: 3.9%1 Cash generated from Project Debt Refinancings (non-recourse) Total Funds Raised NIFA 2020 Million USD
DIVIDEND Q2 2020 Dividend1 of $0.42 per share Quarterly dividends declared by the Board of Directors and paid during the following quarter. On July 31, 2020, the Board of Directors declared a dividend of $0.42 per share corresponding to the second quarter of 2020 The dividend is expected to be paid on September 15, 2020, to shareholders of record as of August 31, 2020
3. Appendix Sustainable Infrastructure
Strong Liquidity and No Significant Corporate Debt Maturities in the Short-term >$500 million @ 30/06/20 Corporate Liquidity ~5.0 years average maturity1 of current corporate debt RCF’s maturities in 2021 and 2022, we intend to seek renewal as usual ~$530 million available liquidity, out of which $278.7 million is corporate cash as of June 30, 2020Corporate debt maturities in 2025, 2026 and 2027 Corporate Debt Maturities1 RCF Corporate Debt Maturites as of June 30, 2020, presented for their accounting amounts, pro forma of new debt issued in July 2020, presented for their notional amounts. STRATEGIC UPDATEHealthy Balance Sheet and Strong Liquidity
Total cash obtained from non-recourse project financings and refinancings to be used in acquisitions: Additional tranche of debt at the SPV with a private investor3.0% interest costBack-ended amortization with a 15 year maturityAA Rating by S&P Helioenergy New Project Debt 2 $43M New debt in a holding of certain Spanish assets3.1% interest cost75% bullet in year 5 / 25% amortizing Green Project Finance in Spain closed in Q2 3 $143M Approx. Net Recap1 $216M New approx. €326 million project debt to replace the previous one (approx. €250 million outstanding) and cancel legacy swapsCost improvement: 1.9% interest cost vs. ~4.2% in the previous financing (with spread step-ups)Maturity extension: 17 year maturity vs. 7 year in the previous financing $30M Helios Refinancing After refinancing fees and costs. GROWTH STRATEGYProject Debt RefinancingsAdditional cash for acquisitions without increasing Corporate Debt 1
GROWTH STRATEGYCorporate Debt Refinancings $115 million5 year maturity4% couponExchange rate equivalent to 34.36 per ordinary shareOversubscriptionLeveraging on our ESG focusIn compliance with 2018 Green Bond Principles Green Exchangeable Bond NIFA 2020 $158 million (€140 million)7 year maturity5.25% couponClosing subject to exercising Solana optionPrivate investor
CORPORATE DEBT DETAILSCorporate Debt as of June 30, 2020No significant maturities in the short term Exchange rates as of June 30, 2020 (EUR/USD = 1.1234).Amounts include principal amounts outstanding and interests to be paid in the short term.As of June 30, 2020, the total amount drawn down under our RCF was $172.3 million. Total RCF limit of $425 million, of which $37.5 million with maturity in 2021 and the rest in 2022.Other facilities include other credit lines, the commercial paper program issued in October 2019 and RCF line with maturity in 2021. US $ in millions1 Maturity Amounts2 Credit Facilities (2022 Revolving CF) 20223 156.4 (Other facilities)4 2020 / 2021 48.8 2019 NIFA5(€ denominated) 2025 309.3 Green Senior Secured Notes 2026 322.5 Total 837.0 (5) NIFA means Note Issuance Facility Agreement. 2019 NIFA refers to the senior secured note facility dated April 30, 2019, of Euro equivalent of $300 million.(6) Senior unsecured obligations dated July 17, 2020, exchangeable into ordinary shares of Atlantica, cash, or a combination of both, at Atlantica’s election.(7) 2020 NIFA refers to the senior secured note facility dated July 8, 2020, of €140 million (~$158 million as of signing date exchange rate) with closing expected in August 2020 subject to condition precedents.(8) Aggregate principal amount. US $ in millions Maturity Amounts8 Green Exchangeable Bond6 2025 115.0 2020 NIFA7 (€ denominated) 2027 ~158.0 New issuances in July 2020:
Improved ESG Ratings in 2019 Performance Rank Percentile Renewable Power Production 1 out of 48 1st Utilities 1 out of 442 1st Global Universe 58 out of 12,228 1st 9.7 ESG Risk Score “Negligible Risk”1 “B” rating1 Active Player in Green Financing 14% Reduction of GHG Emissions 14% reduction of GHG emissionsReporting Scope 1, 2 and 34.7 million tons of CO2 emissions avoided2 We have issued in the last 12 months: A Green Exchangeable BondA Green Project Finance FacilityA Green Private Placement According to Sustanalytics ESG Risk Rating Summary Report dated February 12, 2020 and CDP Score Report - Climate Change 2019. For further information please see both reports on our website.Calculated taking into account GHG emissions Scope 1 and 2 and energy generation of our power generation assets, both electric and thermal energy. The GHG Equivalences Calculator uses the Avoided Emissions and Generation Tool (AVERT) U.S. national weighted average CO2 marginal emissions rate to convert reductions of Kilowatt-hours into avoided units of carbon dioxide emissions. Commitment to maintain 80% of our revenues generated from low-carbon footprint assets Rating issued in January 2020Risk score improved versus last year ESG FOCUSGood Progress on our ESG Commitments
Weighted Average Life Project debt term Represents weighted average years remaining as of December 31, 2019, and includes the acquisitions of new assets announced as of June 30, 2020. (2) Regulation term in the case of Spain and Chile TL3. PPAs with predefined prices for ~18 years on average1 Refinancing opportunities could increase CAFD in earlier years Possibility to extend life in many assets (excluding ATN and ATS) Tails in most assets after debt amortization Contract term2 LONG-TERM STABLE CASH FLOWStrong Portfolio of Assets Year
Key principle: non-recourse project financing in ring-fenced subsidiaries100% project debt self-amortizing progressively before the end of the contracted lifeLow interest rate risk, with +90% of interest rates fixed or hedged >$1.1B planned debt reduction in the next 4 years FINANCING Self-Amortizing Project Debt Structure1 Project debt amortization schedule as of December 31, 2019.
Includes cash classified in short-term financial investments as of December 31, 2019. Exchange rates as of June 30, 2020 (EUR/USD = 1.1234) and December 31, 2019 (EUR/USD = 1.1213).Restricted cash is cash which is restricted generally due to requirements of project finance lenders. US $ in millions2 As of June 302020 As of Dec. 312019 Corporate cash at Atlantica 278.7 66.0 Existing available revolver capacity 251.0 341.0 Total Corporate Liquidity 529.7 407.0 Cash at project companies1 510.1 531.5 - Restricted3 323.4 373.6 - Other 186.7 157.9 LIQUIDITYStrong Liquidity Position1
1Q18 2Q18 3Q18 4Q18 FY 2018 1Q19 2Q19 3Q19 4Q19 FY 2019 1Q20 2Q20 Revenues 225,265 287,848 323,812 206,897 1,043,822 221,452 283,338 293,373 213,289 1,011,452 210,403 255,344 Adj. EBITDA incl. unconsolidated affiliates 179,800 263,458 271,188 144,270 858,717 181,106 229,352 247,668 163,429 821,255 165,962 214,107 Adj. EBITDA margin (%) 79.8% 91.5% 83.7% 69.7% 82.3% 81.8% 80.9% 84.4% 76.6% 81.2% 78.9% 83.9% Atlantica’s pro-rata share of EBITDA from unconsolidated affiliates (1,832) (2,071) (2,183) (2,024) (8,110) (2,017) (2,043) (3,062) (3,229) (10,351) (3,553) (3,959) Adjusted EBITDA 177,968 261,388 269,005 142,246 850,607 179,089 227,309 244,606 160,200 811,204 162,409 210,148 Dividends from unconsolidated affiliates - - 4,432 - 4,432 - - 26,945 3,498 30,443 5,120 5,262 Non-monetary items (8,839) (60,629) (14,755) (15,057) (99,280) (14,632) (7,729) (10,288) (4,783) (37,432) (4,334) (3,683) Interest and income tax paid (26,760) (133,844) (29,212) (143,721) (333,537) (13,925) (129,405) (24,339) (131,845) (299,514) (11,436) (119,517) Principal amortization of indebtedness net of new indebtedness at projects (17,647) (71,028) (13,025) (127,947) (229,647) (15,176) (93,935) (22,115) (123,568) (254,794) (14,898) (75,301) Deposits into/withdrawals from debt service accounts (16,631) (2,643) (26,128) 4,205 (41,197) 21,461 25,564 (52,463) 4,721 (717) 32,921 17,605 Change in non-restricted cash at project companies (63,782) 85,444 (93,166) 93,857 22,352 (61,445) 69,866 (58,847) 119,707 69,281 (50,467) 31,257 Dividends paid to non-controlling interests - (6,787) (2,958) - (9,745) - (5,105) (18,978) (5,156) (29,239) (4,915) (9,246) Changes in other assets and liabilities (1,278) (25,195) (51,465) 85,499 7,562 (50,253) (37,183) (38,792) 27,271 (98,957) (66,842) (6,808) Cash Available For Distribution (CAFD) 43,031 46,706 42,728 39,082 171,547 45,119 49,382 45,729 50,045 190,275 47,558 49,717 Dividends declared1 32,070 34,074 36,078 37,080 139,302 39,625 40,641 41,657 41,657 163,579 41,657 42,673 # of shares at the end of the period 100,217,260 100,217,260 100,217,260 100,217,260 100,217,260 100,217,260 101,601,662 101,601,662 101,601,662 101,601,662 101,601,662 101,601,662 DPS (in $ per share) 0.32 0.34 0.36 0.37 1.39 0.39 0.40 0.41 0.41 1.61 0.41 0.42 Project debt 5,533.8 5,218.8 5,214.7 5,091.1 5,091.1 5,076.4 4,997.4 4,931.3 4,852.3 4,852.3 4,777.2 5,007.6 Project cash (604.5) (504.9) (609.6) (524.8) (524.8) Project cash (604.5) (504.9) (609.6) (524.8) (524.8) (546.7) (469.0) (568.5) (496.8) (496.8) (535.3) (510.1) Net project debt 4,929.3 4,713.9 4,605.1 4,566.3 4,566.3 4,529.6 4,528.4 4,362.8 4,355.6 4,355.6 4,241.9 4,497.5 Corporate debt 657.3 639.0 641.8 684.1 684.1 697.5 689.6 686.4 723.8 723.8 807.3 837.0 Corporate cash (151.4) (152.3) (135.1) (106.7) (106.7) (107.9) (107.0) (73.2) (66) (66) (154.9) (278.7) Net corporate debt 505.9 486.8 506.7 577.4 577.4 589.7 582.6 613.2 657.8 657.8 652.4 558.3 Total net debt 5,435.2 5,200.6 5,111.8 5,143.6 5,143.6 5.119.3 5,111.0 4,976.0 5,013.3 5,013.3 4,894.4 5,055.8 Net Corporate Debt/CAFD pre corporate interests2 2.3x 2.2x 2.3x 2.7x 2.7x 2.5x 2.5x 2.7x 2.9x 2.9x 2.4x 2.3x HISTORICAL FINANCIAL REVIEWKey Financials by Quarter Debt details Key Financials US $ in thousands (3) Dividends are paid to shareholders in the quarter after they are declared.Ratios presented are the ratios shown on each earnings presentations.(3) Excludes Solana debt repayments with proceeds received from Abengoa $52.5M in Mar’18. (4) “Deposits into/ withdrawals from restricted accounts” and “Change in non-restricted cash at project level” are calculated on a constant currency basis to reflect actual cash movements isolated from the impact of variations generated by foreign exchange changes during the period. Prior periods have been recalculated to conform this presentation. (4) (4) US $ in millions
HISTORICAL FINANCIAL REVIEWSegment Financials by Quarter 1Q18 2Q18 3Q18 4Q18 FY 2018 1Q19 2Q19 3Q19 4Q 19 FY 2019 1Q20 2Q20 by Geography NORTH AMERICA 61,781 110,534 122,309 62,553 357,177 60,441 104,095 109,378 59,052 332,965 59,283 98,648 SOUTH AMERICA 29,536 30,345 31,928 31,405 123,214 33,493 35,597 36,671 36,447 142,207 35,654 39,375 EMEA 133,948 146,969 169,576 112,938 563,431 127,518 143,646 147,325 117,790 536,280 115,466 117,321 by Business Sector RENEWABLES 167,225 224,988 259,922 141,422 793,557 156,817 223,269 229,742 151,261 761,090 150,793 193,881 EFFICIENT NAT. GAS 28,387 33,050 33,918 35,444 130,799 34,009 27,689 31,193 29,390 122,281 26,403 25,629 TRANSMISSION 23,840 24,063 24,018 24,076 95,998 24,867 26,231 25,926 26,429 103,453 26,608 26,787 WATER 5,813 5,747 5,955 5,954 23,468 5,759 6,149 6,511 6,209 24,629 6,599 9,047 Total Revenue 225,265 287,848 323,813 206,896 1,043,822 221,452 283,338 293,373 213,289 1,011,452 210,403 255,344 1Q18 2Q18 3Q18 4Q18 FY 2018 1Q19 2Q19 3Q19 4Q19 FY 2019 1Q20 2Q20 by Geography NORTH AMERICA 60,247 94,411 117,498 36,591 308,748 50,870 96,293 108,198 51,881 307,242 52,661 89,954 97.5% 85.4% 96.1% 58.5% 86.4% 84.2% 92.5% 98.9% 88.8% 92.3% 88.8% 91.2% SOUTH AMERICA1 24,180 25,067 26,987 23,999 100,233 28,212 29,252 30,293 27,589 115,346 28,422 31,380 81.9% 82.6% 84.5% 76.4% 81.3% 84.2% 82.2% 82.6% 75.6% 81.1% 79.7% 79.7% EMEA 95,373 143,979 126,703 83,681 449,736 102,024 103,807 109,177 83,959 398,968 84,879 92,773 71.2% 98.0% 74.7% 74.1% 79.8% 80.0% 72.3% 74.1% 71.3% 74.4% 73.5% 79.1% by Business Sector RENEWABLES 131,434 213,952 220,529 98,514 664,429 123,484 177,910 192,168 110,517 604,079 113,670 161,415 78.6% 95.1% 84.8% 69.7% 83.7% 78.7% 79.7% 83.6% 73.1% 79.4% 75.4% 83.3% EFFICIENT NAT. GAS 23,330 23,652 24,742 22,134 93,858 30,476 23,826 27,983 26,915 109,200 24,462 23,303 82.2% 71,.6% 72.9% 62.4% 71.8% 89.6% 86.1% 89.7% 91.6% 89.3% 92.6% 90.9% TRANSMISSION1 19,837 20,463 20,148 18,014 78,463 21,650 21,936 21,548 20,524 85,658 21,922 22,423 83.2% 85.0% 83.9% 74.8% 81.7% 87.1% 83.6% 83.1% 77.6% 82.7% 82.4% 83.7% WATER 5,199 5,392 5,769 5,608 21,967 5,496 5,680 5,969 5,473 22,619 5,908 6,966 89.4% 93.8% 96.9% 94.2% 93.6% 95.4% 92.4% 91.7% 88.1% 91.8% 89.5% 77.0% Total Adj. EBITDA incl. unconsolidated affiliates1 179,800 263,458 271,188 144,270 858,717 181,106 229,352 247,668 163,429 821,556 165,962 214,107 79.8% 91.5% 83.7% 69.7% 82.3% 81.8% 80.9% 84.4% 76.6% 81.2% 78.9% 83.9% US $ in thousands Revenue Adj. EBITDA incl. unconsolidated affiliates Adjusted EBITDA includes our share in EBITDA of unconsolidated affiliates.
1Q18 2Q18 3Q18 4Q18 FY 2018 1Q19 2Q19 3Q19 4Q19 FY 2019 1Q20 2Q20 RENEWABLES3 (GWh) 507 939 1,109 504 3,058 581 1,071 1,048 536 3,236 526 957 (GWh) 547 554 613 603 2,318 383 483 615 694 2,090 644 624 (electric availability %) 97.9% 99.3% 101.3% 100.9% 99.8% 87.1% 89.9% 101.5% 101.4% 95.0% 102.4% 100.9% TRANSMISSION (availability %) 100.0% 99.9% 100.0% 99.8% 99.9% 99.9% 100.0% 99.9% 100% 100% 99.9% 99.9% WATER (availability %) 99.1% 102.6% 103.7% 102.5% 102.0% 99.8% 100.6% 103.6% 100.1% 101.2% 101.8% 102.2% 1Q18 2Q18 3Q18 4Q18 FY 2018 1Q19 2Q19 3Q19 4Q19 FY 2019 1Q20 2Q20 RENEWABLES1 (MW) 1,446 1,446 1,446 1,496 1,496 1,496 1,496 1,496 1,496 1,496 1,496 1,551 EFF. NATURAL GAS2 (electric MW) 300 300 300 300 300 300 300 343 343 343 343 343 TRANSMISSION1 (Miles) 1,099 1,099 1,099 1,152 1,152 1,152 1,152 1,152 1,166 1,166 1,166 1,166 WATER1 (Mft3/day) 10.5 10.5 10.5 10.5 10.5 10.5 10.5 10.5 10.5 10.5 10.5 17.5 Capacity in operation(at the end of the period) Production / Availability 5 6 6 Represents total installed capacity in assets owned at the end of the period, regardless of our percentage of ownership in each of the assets.Includes 43MW corresponding to our 30% share of Monterrey since August 2, 2019.Includes curtailment in wind assets for which we receive compensation.GWh produced includes 30% production from Monterrey since August 2019. Major maintenance overhaul held in ACT in Q1 and Q2 2019, as scheduled, which reduced production and electric availability as per the contract.Electric availability refers to operational MW over contracted MW. Availability refers to actual availability divided by contracted availability. EFFICIENT NATURAL GAS4 HISTORICAL FINANCIAL REVIEWKey Performance Indicators
1Q18 2Q18 3Q18 4Q18 FY 2018 1Q19 2Q19 3Q19 4Q19 FY 2019 1Q20 2Q20 US 18.8% 39.9% 38.9% 15.0% 28.2% 15.2% 39.8% 35.2% 16.3% 26.6% 18.2% 37.5% Spain 8.8% 20.8% 30.6% 7.3% 16.9% 12.1% 26.7% 27.2% 6.7% 18.2% 8.0% 22.1% Kaxu 36.9% 27.6% 29.9% 50.0% 36.0% 48.7% 27.8% 27.5% 45.4% 37.3% 28.9% 8.6% WIND2 Uruguay 31.2% 34.5% 42.3% 40.7% 37.2% 33.0% 36.3% 40.9% 38.0% 37.2% 34.6% 40.8% SOLAR Historical Capacity Factors1 Capacity factor ratio represents actual electrical energy output over a given period of time to the maximum possible electrical energy output assuming continuous operation at full nameplate capacity over that period. Historical Capacity Factors are calculated from the date of entry into operation or the acquisition of each asset. Some capacity factors are not indicative of a full period of operations.Includes curtailment production in wind assets for which we receive compensation. HISTORICAL FINANCIAL REVIEWCapacity Factors
CURRENCY2 SECTOR GEOGRAPHY Based on CAFD estimates for the 2020-2024 period, including the acquisitions announced. See “Disclaimer – Forward Looking Statements”.Including the effect of currency swap agreements. of long-term interest rates in projects are fixed or hedged2 ~ 90% 90 Denominatedin USD % > 69% Renewable15% Transmission & Transport.13% Efficient Natural Gas 3% Water 45% North America35% Europe12% South America8% RoW SIZEABLE AND DIVERSIFIED ASSET PORTFOLIOPortfolio Breakdown Based on Estimated CAFD1
As of June 30, 2020 ASSET TYPE STAKE LOCATION GROSSCAPACITY OFFTAKER RATING 1 YEARS INCONTRACT LEFT CURRENCY RENEWABLE ENERGY Solana 100%2 USA (Arizona) 280 MW APS A-/A2/A- 23 USD Mojave 100% USA (California) 280 MW PG&E BB-/WR/BB 19 USD Solaben 2/3 70% Spain 2x50 MW Kingdom of Spain A/Baa1/A- 17/17 EUR 4 Solacor 1/2 87% Spain 2x50 MW Kingdom of Spain A/Baa1/A- 17/17 EUR 4 PS 10/20 100% Spain 31 MW Kingdom of Spain A/Baa1/A- 12/14 EUR 4 Helioenergy 1/2 100% Spain 2x50 MW Kingdom of Spain A/Baa1/A- 16/16 EUR 4 Helios 1/2 100% Spain 2x50 MW Kingdom of Spain A-/Baa1/A- 17/17 EUR 4 Solnova 1/3/4 100% Spain 3x50 MW Kingdom of Spain A/Baa1/A- 15/15/15 EUR 4 Solaben 1/6 100% Spain 2x50 MW Kingdom of Spain A/Baa1/A- 18/18 EUR 4 Seville PV 80% Spain 1 MW Kingdom of Spain A/Baa1/A- 16 EUR Kaxu 51% South Africa 100 MW Eskom BB-/Ba1/BB3 15 ZAR Chile PV I 36% Chile 55 MW n/a n/a n/a USD 5 Palmatir 100% Uruguay 50 MW UTE BBB/Baa2/BBB-3 14 USD Cadonal 100% Uruguay 50 MW UTE BBB/Baa2/BBB-3 14 USD Melowind 100% Uruguay 50 MW UTE BBB/Baa2/BBB-3 16 USD Mini-Hydro 100% Peru 4 MW Peru BBB+/A3/BBB+ 13 USD EFFICIENT NATURAL GAS ACT 100% Mexico 300 MW Pemex BBB/Ba2/BB- 13 USD 5 Monterrey 30% Mexico 142 MW Industrial Customers Not rated 18 USD 5 ELECTRICAL TRANSMISSION ATN 100% Peru 379 miles Peru BBB+/A3/BBB+ 21 USD 5 ATS 100% Peru 569 miles Peru BBB+/A3/BBB+ 24 USD 5 ATN 2 100% Peru 81 miles Minera Las Bambas Not rated 13 USD 5 Quadra 1&2 100% Chile 81 miles Sierra Gorda Not rated 15/15 USD 5 Palmucho 100% Chile 6 miles Enel Generacion Chile BBB+/Baa1 /A- 17 USD 5 Chile TL3 100% Chile 50 miles CNE A+/A1/A Regulated USD 5 WATER Skikda 34% Algeria 3.5 Mft3/day Sonatrach & ADE Not rated 14 USD 5 Honaine 26% Algeria 7 Mft3/day Sonatrach & ADE Not rated 17 USD 5 Tenes 51% Algeria 7 Mft3/day Sonatrach & ADE Not rated 20 USD 5 Reflects the counterparties’ issuer credit ratings issued by S&P, Moody’s and Fitch, respectively, as of August 3, 2020.Liberty Interactive Corporation holds $300M in Class A membership interests in exchange for a share of the dividends and the taxable loss generated by Solana.For Kaxu, it refers to the credit rating of the Republic of South Africa, and for Palmatir, Cadonal and Melowind, it refers to the credit rating of Uruguay, as UTE is unrated.Gross cash in euros dollarized through currency hedges.USD denominated but payable in local currency. AT A GLANCESizeable and Diversified Asset Portfolio
NON-GAAP FINANCIAL INFORMATIONReconciliation of Non-GAAP Measures Our management believes Adjusted EBITDA including unconsolidated affiliates and CAFD are useful to investors and other users of our financial statements in evaluating our operating performance because it provides them with an additional tool to compare business performance across companies and across periods. Adjusted EBITDA is widely used by investors to measure a company’s operating performance without regard to items such as interest expense, taxes, depreciation and amortization, which can vary substantially from company to company depending upon accounting methods and book value of assets, capital structure and the method by which assets were acquired. Our management believes CAFD is a relevant supplemental measure of the Company’s ability to earn and distribute cash returns to investors and is useful to investors in evaluating our operating performance because securities analysts and other interested parties use such calculations as a measure of our ability to make quarterly distributions. In addition, CAFD is used by our management team for determining future acquisitions and managing our growth. Adjusted EBITDA and CAFD are widely used by other companies in the same industry. Our management uses Adjusted EBITDA and CAFD as measures of operating performance to assist in comparing performance from period to period on a consistent basis. They also readily view operating trends as a measure for planning and forecasting overall expectations, for evaluating actual results against such expectations, and for communicating with our board of directors, shareholders, creditors, analysts and investors concerning our financial performance.We present non-GAAP financial measures because we believe that they and other similar measures are widely used by certain investors, securities analysts and other interested parties as supplemental measures of performance and liquidity. The non-GAAP financial measures may not be comparable to other similarly titled measures employed by other companies and they may have limitations as analytical tools. These measures may not be fit for isolated consideration or as a substitute for analysis of our operating results as reported under IFRS as issued by the IASB. Non-GAAP financial measures and ratios are not measurements of our performance or liquidity under IFRS as issued by the IASB. Thus, they should not be considered as alternatives to operating profit, profit for the period, any other performance measures derived in accordance with IFRS as issued by the IASB, any other generally accepted accounting principles or as alternatives to cash flow from operating, investing or financing activities. Some of the limitations of these non-GAAP measures are:they do not reflect our cash expenditures, future requirements for capital expenditures or contractual commitments; they do not reflect changes in, or cash requirements for, our working capital needs;they may not reflect the significant interest expense, or the cash requirements necessary, to service interest or principal payments, on our debts;although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often need to be replaced in the future and Adjusted EBITDA and CAFD do not reflect any cash requirements that would be required for such replacements;some of the exceptional items that we eliminate in calculating Adjusted EBITDA reflect cash payments that were made, or will be made in the future; andthe fact that other companies in our industry may calculate Adjusted EBITDA and CAFD differently than we do, which limits their usefulness as comparative measures.
RECONCILIATIONReconciliation of Cash Available For Distribution and Adjusted EBITDA to Profit/(loss) for the period attributable to the Company Adjusted EBITDA including unconsolidated affiliates includes our share in EBITDA of unconsolidated affiliates.“Deposits into/ withdrawals from restricted accounts” and “Change in non-restricted cash at project level” are calculated on a constant currency basis to reflect actual cash movements isolated from the impact of variations generated by foreign exchange changes during the period. Prior period has been recalculated to conform this presentation. (in thousands of U.S. dollars) For the three-month period ended June 30, For the six-month period ended June 30, 2020 2019 2020 2019 Profit/(loss) for the period attributable to the Company $ 12,340 $ 25,913 $ (28,171) $ 16,956 Profit attributable to non-controlling interest (267) 524 1,979 5,791 Income tax 13,618 17,463 3,471 27,040 Share of loss/(profit) of associates carried under the equity method (2,259) (1,529) (1,591) (3,352) Financial expense, net 102,263 110,611 202,797 209,900 Operating profit $ 125,695 $ 152,982 $ 178,485 $ 256,335 Depreciation, amortization, and impairment charges 84,454 74,327 194,073 150,063 Adjusted EBITDA $ 210,148 $ 227,309 $ 372,557 $ 406,398 Atlantica’s pro-rata share of EBITDA from unconsolidated affiliates 3,959 2,043 7,512 4,060 Adjusted EBITDA including unconsolidated affiliates1 $ 214,107 $ 229,352 $ 380,069 $ 410,458 Atlantica’s pro-rata share of EBITDA from unconsolidated affiliates (3,959) (2,043) (7,512) (4,060) Dividends from equity method investments 5,262 - 10,382 - Non-monetary items (3,683) (7,729) (8,017) (22,361) Interest and income tax paid (119,517) (129,405) (130,953) (143,330) Principal amortization of indebtedness (75,301) (93,935) (90,199) (109,111) Deposits into/ withdrawals from restricted accounts 17,605 22,692 50,526 47,627 Change in non-restricted cash at project level 31,257 68,101 (19,210) 8,654 Dividends paid to non-controlling interests (9,246) (5,105) (14,161) (5,105) Changes in other assets and liabilities (6,808) (32,546) (73,650) (88,271) Cash Available For Distribution $ 49,717 $ 49,382 $ 97,275 $ 94,501
RECONCILIATIONReconciliation of Adjusted EBITDA including unconsolidated affiliates to Net Cash Provided by Operating Activities Adjusted EBITDA including unconsolidated affiliates includes our share in EBITDA of unconsolidated affiliates. (in thousands of U.S. dollars) For the three-month period ended June 30 For the six-month period ended June 30, 2020 2019 2020 2019 Net cash provided by operating activities $ 62,722 $ 52,218 $ 148,407 $ 149,108 Net interest and income tax paid 119,517 129,405 130,953 143,329 Variations in working capital 24,672 37,418 84,005 91,926 Other non-cash adjustments and other 3,237 8,268 9,192 22,035 Adjusted EBITDA $ 210,148 $ 227,309 $ 372,557 $ 406,398 Atlantica’s pro-rata share of EBITDA from unconsolidated affiliates 3,959 2,043 7,512 4,060 Adjusted EBITDA including unconsolidated affiliates1 $ 214,107 $ 229,352 $ 380,069 $ 410,458
RECONCILIATIONReconciliation of Adjusted EBITDA Margin including unconsolidated affiliates to Operating Profit Margin Adjusted EBITDA including unconsolidated affiliates includes our share in EBITDA of unconsolidated affiliates. (in thousands of U.S. dollars) For the three-month period ended June 30, For the six-month period ended June 30, 2020 2019 2020 2019 Revenue $ 255,344 $ 283,338 $ 465,747 $ 504,790 Profit/(loss) for the period attributable to the Company $ 12,340 $ 25,913 $ (28,171) $ 16,956 Profit attributable to non-controlling interest (267) 524 1,979 5,791 Income tax 13,618 17,463 3,471 27,040 Share of loss/(profit) of associates carried under the equity method (2,259) (1,529) (1,591) (3,352) Financial expense, net 102,263 110,611 202,797 209,900 Operating profit $ 125,695 $ 152,982 $ 178,485 $ 256,335 Operating profit margin % 49.2 % 54.0 % 38.3 % 50.8 Depreciation, amortization, and impairment charges 33.1 26.2 41.7 29.7 Adjusted EBITDA margin % 82.3 % 80.2 % 80.0 % 80.5 Atlantica’s pro-rata share of EBITDA from unconsolidated affiliates 1.6 0.7 1.6 0.8 Adjusted EBITDA Margin including unconsolidated affiliates1 % 83.9 % 80.9 % 81.6 % 81.3
Great West House, GW1, 17th floor,Great West RoadBrentford TW8 9DFLondon (United Kingdom)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Atlantica Sustainable Infrastructure plc | |||
Date: August 3, 2020 | By: | /s/ Santiago Seage | |
Name: | Santiago Seage | ||
Title: | Chief Executive Officer |