Exhibit 99.2
Financial Information for the Three Months and Six Months Ended June 30, 2019 of Kenon and OPC and
Reconciliation of Certain non-IFRS Financial Information
Table of Contents
Summary Kenon consolidated financial information
Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Financial Position as of June 30, 2019 and December 31, 2018
Consolidated Statement of Financial Position as of June 30, 2019 and December 31, 2018
As of June 30, | As of December 31, | |||||||
2019 | 2018 | |||||||
(Unaudited) | ||||||||
$ millions | ||||||||
Current assets | ||||||||
Cash and cash equivalents | 138 | 131 | ||||||
Short-term investments and deposits | 78 | 50 | ||||||
Trade receivables, net | 32 | 36 | ||||||
Other current assets, including derivatives | 46 | 41 | ||||||
Asset held for sale | 70 | 70 | ||||||
Total current assets | 364 | 328 | ||||||
Non-current assets | ||||||||
Investments in associated companies | 144 | 161 | ||||||
Deposits, loans and other receivables, including derivative instruments | 153 | 140 | ||||||
Deferred payment receivable | 197 | 189 | ||||||
Deferred taxes, net | 1 | 1 | ||||||
Property, plant and equipment, net (including right-of-use asset) | 670 | 635 | ||||||
Intangible assets, net | 1 | 1 | ||||||
Total non-current assets | 1166 | 1,127 | ||||||
Total assets | 1,530 | 1,455 | ||||||
Current liabilities | ||||||||
Loans and debentures | 36 | 23 | ||||||
Trade payables | 61 | 48 | ||||||
Other payables, including derivative instruments and liabilities in respect of leases | 15 | 12 | ||||||
Income tax payable | 1 | 7 | ||||||
Total current liabilities | 113 | 90 | ||||||
Non-current liabilities | ||||||||
Loans, excluding current portion | 507 | 488 | ||||||
Debentures, excluding current portion | 75 | 75 | ||||||
Deferred taxes, net | 68 | 59 | ||||||
Income tax payable | 28 | 27 | ||||||
Other non-current liabilities | 6 | - | ||||||
Total non-current liabilities | 684 | 649 | ||||||
Total liabilities | 797 | 739 | ||||||
Equity | ||||||||
Share capital | 602 | 602 | ||||||
Translation reserve | 7 | 1 | ||||||
Capital reserve | 16 | 17 | ||||||
Accumulated profit | 26 | 29 | ||||||
Equity attributable to owners of the Company | 651 | 649 | ||||||
Non-controlling interests | 82 | 67 | ||||||
Total equity | 733 | 716 | ||||||
Total liabilities and equity | 1,530 | 1,455 |
Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Profit & Loss
Consolidated Statement of Profit & Loss
For the six months ended June 30, | For the three months ended June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
$ millions | $ millions | |||||||||||||||
Revenue | 182 | 185 | 85 | 84 | ||||||||||||
Cost of sales and services (excluding depreciation) | (126 | ) | (127 | ) | (64 | ) | (63 | ) | ||||||||
Depreciation | (15 | ) | (15 | ) | (8 | ) | (8 | ) | ||||||||
Gross profit | 41 | 43 | 13 | 13 | ||||||||||||
Selling, general and administrative expenses | (18 | ) | (11 | ) | (8 | ) | (5 | ) | ||||||||
Other income | 1 | - | 1 | - | ||||||||||||
Financing expenses | (16 | ) | (17 | ) | (10 | ) | (11 | ) | ||||||||
Financing income | 9 | 12 | 5 | 10 | ||||||||||||
Financing expenses, net | (7 | ) | (5 | ) | (5 | ) | (1 | ) | ||||||||
Gain on third party investment in Qoros | - | 504 | - | - | ||||||||||||
Fair value loss on put option | (8 | ) | (13 | ) | (3 | ) | (13 | ) | ||||||||
Write back of financial guarantee | - | 63 | - | - | ||||||||||||
Share in losses of associated companies, net of tax | (16 | ) | (50 | ) | (3 | ) | (22 | ) | ||||||||
(Loss)/profit before income taxes | (7 | ) | 531 | (5 | ) | (28 | ) | |||||||||
Income taxes | (7 | ) | (7 | ) | (2 | ) | (1 | ) | ||||||||
(Loss)/profit for the period from continuing operations | (14 | ) | 524 | (7 | ) | (29 | ) | |||||||||
Loss for the period from discontinued operations (after tax) | (1 | ) | - | (1 | ) | - | ||||||||||
(Loss)/profit for the period | (15 | ) | 524 | (8 | ) | (29 | ) | |||||||||
Attributable to: | ||||||||||||||||
Kenon's shareholders | (20 | ) | 517 | (8 | ) | (29 | ) | |||||||||
Non-controlling interests | 5 | 7 | - | - | ||||||||||||
(Loss)/profit for the period | (15 | ) | 524 | (8 | ) | (29 | ) | |||||||||
Basic/diluted (loss)/profit per share attributable to Kenon's shareholders (in dollars): | ||||||||||||||||
Basic/diluted (loss)/profit per share | (0.37 | ) | 9.60 | (0.13 | ) | (0.53 | ) | |||||||||
Basic/diluted (loss)/profit per share from continuing operations | (0.35 | ) | 9.60 | (0.12 | ) | (0.53 | ) | |||||||||
Basic/diluted loss per share from discontinued operations | (0.02 | ) | - | (0.01 | ) | - |
Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Cash Flows
For the six months ended June 30, 2019 and 2018
Consolidated Statement of Cash Flows
For the six months ended June 30, 2019 and 2018
For the six months ended June 30, | ||||||||
2019 | 2018 | |||||||
$ millions | ||||||||
Cash flows from operating activities | ||||||||
(Loss) / profit for the period | (15 | ) | 524 | |||||
Adjustments: | ||||||||
Depreciation and amortization | 15 | 15 | ||||||
Financing expenses, net | 7 | 5 | ||||||
Share in losses of associated companies, net of tax | 16 | 50 | ||||||
Write back of financial guarantee | - | (63 | ) | |||||
Gain on third party investment in Qoros | - | (504 | ) | |||||
Fair value loss on put option | 8 | 13 | ||||||
Write back of other payables | - | (3 | ) | |||||
Share-based payments | 1 | 1 | ||||||
Income taxes | 8 | 7 | ||||||
40 | 45 | |||||||
Change in trade and other receivables | 12 | 17 | ||||||
Change in trade and other payables | 10 | (14 | ) | |||||
62 | 48 | |||||||
Income taxes paid, net | (7 | ) | (169 | ) | ||||
Net cash provided by / (used in) operating activities | 55 | (121 | ) |
Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Cash Flows, continued
For the six months ended June 30, 2019 and 2018
Consolidated Statement of Cash Flows, continued
For the six months ended June 30, 2019 and 2018
For the six months ended June 30, | ||||||||
2019 | 2018 | |||||||
$ millions | ||||||||
Cash flows from investing activities | ||||||||
Short-term deposits and loans, net | (26 | ) | - | |||||
(Payment for)/proceeds from long-term deposits, net | (14 | ) | 3 | |||||
Cash paid for businesses purchased, less cash acquired | - | (2 | ) | |||||
Acquisition of property, plant and equipment | (19 | ) | (33 | ) | ||||
Interest received | - | 2 | ||||||
Proceeds from dilution of third party investment in Qoros | - | 260 | ||||||
Receipt to release financial guarantee | - | 18 | ||||||
Payment of transaction cost for sale of subsidiaries | - | (49 | ) | |||||
Sale of subsidiary, net of cash disposed off | 1 | - | ||||||
Net cash (used in) / provided by investing activities | (58 | ) | 199 | |||||
Cash flows from financing activities | ||||||||
Dividend paid to non-controlling interests in a subsidiary | (7 | ) | (6 | ) | ||||
Capital distribution | - | (665 | ) | |||||
Receipt of long-term loans and issuance of debentures | - | 3 | ||||||
Repayment of long-term loans and debentures | (8 | ) | (101 | ) | ||||
Repayment of short-term credit from banks and others, net | (2 | ) | (276 | ) | ||||
Proceeds from issue of share capital by a subsidiary to non-controlling interests | 33 | - | ||||||
Interest paid | (11 | ) | (14 | ) | ||||
Net cash provided by / (used in) financing activities | 5 | (1,059 | ) | |||||
Increase / (decrease) in cash and cash equivalents | 2 | (981 | ) | |||||
Cash and cash equivalents at beginning of the period | 131 | 1,417 | ||||||
Effect of exchange rate fluctuations on balances of cash and cash equivalents | 5 | (7 | ) | |||||
Cash and cash equivalents at end of the period | 138 | 429 |
Information regarding reportable segments
The following table sets forth selected financial data for Kenon’s reportable segments for the periods presented:
For the six months ended June 30, 2019 | ||||||||||||||||
OPC | Quantum1 | Other2 | Consolidated Results | |||||||||||||
Revenue | 182 | - | - | 182 | ||||||||||||
Depreciation and amortization | (15 | ) | - | - | (15 | ) | ||||||||||
Financing income | - | - | 9 | 9 | ||||||||||||
Financing expenses | (15 | ) | - | (1 | ) | (16 | ) | |||||||||
Fair value loss on put option | - | (8 | ) | - | (8 | ) | ||||||||||
Share in losses of associated companies | - | (9 | ) | (7 | ) | (16 | ) | |||||||||
Profit / (Loss) before taxes | 19 | (17 | ) | (9 | ) | (7 | ) | |||||||||
Income taxes | (5 | ) | - | (2 | ) | (7 | ) | |||||||||
Profit / (Loss) from continuing operations | 14 | (17 | ) | (11 | ) | (14 | ) |
____________________________________
(1) | Quantum is a wholly-owned subsidiary of Kenon which holds Kenon's interest in Qoros. |
(2) | Includes the results of Primus; the results of ZIM, as an associated company; as well as Kenon’s and IC Green’s holding company and general and administrative expenses. |
For the six months ended June 30, 2018 | ||||||||||||||||||||
OPC | Quantum1 | Other2 | Adjustments3 | Consolidated Results | ||||||||||||||||
$ millions | ||||||||||||||||||||
Revenue | 185 | -- | - | - | 185 | |||||||||||||||
Depreciation and amortization | (15 | ) | - | - | - | (15 | ) | |||||||||||||
Fair value loss on put option | - | (13 | ) | - | - | (13 | ) | |||||||||||||
Financing income | 1 | 1 | 39 | (29 | ) | 12 | ||||||||||||||
Financing expenses | (15 | ) | (2 | ) | (29 | ) | 29 | (17 | ) | |||||||||||
Write back of financial guarantee | - | 63 | - | - | 63 | |||||||||||||||
Gain on third party investment in Qoros | - | 504 | - | - | 504 | |||||||||||||||
Share in losses of associated companies | - | (28 | ) | (22 | ) | -- | (50 | ) | ||||||||||||
Profit / (Loss) before taxes | 22 | 526 | (17 | ) | - | 531 | ||||||||||||||
Income taxes | (6 | ) | - | (1 | ) | - | (7 | ) | ||||||||||||
Profit / (Loss) from continuing operations | 16 | 526 | (18 | ) | - | 524 |
____________________________________
(1) | Quantum is a wholly-owned subsidiary of Kenon which holds Kenon's interest in Qoros. |
(2) | Includes the results of Primus; the results of ZIM, as an associated company; as well as Kenon’s and IC Green’s holding company and general and administrative expenses. |
(3) | “Adjustments” includes inter-segment financing income and expenses. |
For the three months ended June 30, 2019 | ||||||||||||||||
OPC | Quantum1 | Other2 | Consolidated Results | |||||||||||||
$ millions | ||||||||||||||||
Revenue | 85 | - | - | 85 | ||||||||||||
Depreciation and amortization | (8 | ) | - | - | (8 | ) | ||||||||||
Financing income | - | - | 5 | 5 | ||||||||||||
Financing expenses | (10 | ) | - | - | (10 | ) | ||||||||||
Fair value loss on put option …… | - | (3 | ) | - | (3 | ) | ||||||||||
Share in (losses) / profits of associated companies | - | (3 | ) | 1 | (2 | ) | ||||||||||
(Loss) / Profit before taxes | - | (6 | ) | 1 | (5 | ) | ||||||||||
Income taxes | - | - | (2 | ) | (2 | ) | ||||||||||
Loss from continuing operations | - | (6 | ) | (1 | ) | (7 | ) |
____________________________________
(1) | Quantum is a wholly-owned subsidiary of Kenon which holds Kenon's interest in Qoros. |
(2) | Includes the results of Primus; the results of ZIM, as an associated company; as well as Kenon’s and IC Green’s holding company and general and administrative expenses. |
For the three months ended June 30, 2018 | ||||||||||||||||||||
OPC | Quantum1 | Other2 | Adjustments3 | Consolidated Results | ||||||||||||||||
$ millions | ||||||||||||||||||||
Revenue | 84 | - | - | - | 84 | |||||||||||||||
Depreciation and amortization | (8 | ) | - | - | - | (8 | ) | |||||||||||||
Financing income | 1 | 1 | 21 | (13 | ) | 10 | ||||||||||||||
Financing expenses | (10 | ) | (1 | ) | (13 | ) | 13 | (11 | ) | |||||||||||
Fair value loss on put option…… | - | (13 | ) | - | - | (13 | ) | |||||||||||||
Share in losses of associated companies | - | (13 | ) | (9 | ) | - | (22 | ) | ||||||||||||
Profit / (Loss) before taxes | 1 | (26 | ) | (3 | ) | - | (28 | ) | ||||||||||||
Income taxes | (1 | ) | - | - | - | (1 | ) | |||||||||||||
Loss from continuing operations | - | (26 | ) | (3 | ) | - | (29 | ) |
____________________________________
(1) | Quantum is a wholly-owned subsidiary of Kenon which holds Kenon's interest in Qoros. |
(2) | Includes the results of Primus; the results of ZIM, as an associated company; as well as Kenon’s and IC Green’s holding company and general and administrative expenses. |
(3) | “Adjustments” includes inter-segment financing income and expenses. |
Information regarding associated companies
Asset held for sale | Carrying amounts of investment in associated companies | Equity in the net (losses) / earnings of associated companies | ||||||||||||||||||||||||||||||
as at | as at | For the sixmonths ended | For the three months ended | |||||||||||||||||||||||||||||
June 30, 2019 | December 31, 2018 | June 30, 2019 | December 31, 2018 | June 30, 2019 | June 30, 2018 | June 30, 2019 | June 30, 2018 | |||||||||||||||||||||||||
$ millions | $ millions | $ millions | $ millions | |||||||||||||||||||||||||||||
ZIM | - | - | 83 | 91 | (7 | ) | (22 | ) | 1 | (9 | ) | |||||||||||||||||||||
Qoros | 70 | 70 | 61 | 70 | (9 | ) | (28 | ) | (4 | ) | (13 | ) | ||||||||||||||||||||
70 | 70 | 144 | 161 | (16 | ) | (50 | ) | (3 | ) | (22 | ) |
Summary OPC consolidated financial information1
OPC’s Consolidated Statement of Profit
For the six months ended June 30, | For the three months ended June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
$ millions | $ millions | |||||||||||||||
Sales | 182 | 185 | 85 | 84 | ||||||||||||
Cost of sales (excluding depreciation and amortization) | (126 | ) | (127 | ) | (64 | ) | (63 | ) | ||||||||
Depreciation and amortization | (15 | ) | (15 | ) | (8 | ) | (8 | ) | ||||||||
Gross profit | 41 | 43 | 13 | 13 | ||||||||||||
General, selling and administrative expenses | (8 | ) | (7 | ) | (4 | ) | (3 | ) | ||||||||
Other income | 1 | - | 1 | - | ||||||||||||
Financing expenses, net | (15 | ) | (14 | ) | (10 | ) | (9 | ) | ||||||||
Profit before taxes | 19 | 22 | - | 1 | ||||||||||||
Taxes on income | (5 | ) | (6 | ) | - | (1 | ) | |||||||||
Net profit for the period | 14 | 16 | - | - | ||||||||||||
Attributable to: | ||||||||||||||||
Equity holders of the company | 11 | 12 | - | - | ||||||||||||
Non-controlling interest | 3 | 4 | - | - | ||||||||||||
Net profit for the period | 14 | 16 | - | - |
(1) | Translations of NIS amounts into US Dollars use a rate of 3.62: 1 for 2019 and 3.59: 1 for 2018. |
Summary Data from OPC’s Consolidated Statement of Cash Flows
For the six months ended June 30, | For the three months ended June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
$ millions | $ millions | |||||||||||||||
Cash flows provided by operating activities | 73 | 66 | 21 | 39 | ||||||||||||
Cash flows used in investing activities | (58 | ) | (39 | ) | (46 | ) | (17 | ) | ||||||||
Cash flows used in / (provided by) financing activities | (1 | ) | (33 | ) | 7 | (28 | ) | |||||||||
Increase / (decrease) in cash and cash equivalents | 14 | (6 | ) | (18 | ) | (6 | ) | |||||||||
Cash and cash equivalents at end of the period | 106 | 133 | 106 | 133 | ||||||||||||
Investments in property, plant and equipment | (18 | ) | (29 | ) | (10 | ) | (14 | ) | ||||||||
Total depreciation and amortization | 15 | 15 | 8 | 8 |
Summary Data from OPC’s Consolidated Statement of Financial Position
As of | ||||||||
June 30, 2019 | December 31, 2018 | |||||||
$ millions | ||||||||
Total financial liabilities1 | 618 | 586 | ||||||
Total monetary assets2 | 250 | 187 | ||||||
Total equity attributable to the owners | 221 | 181 | ||||||
Total assets | 1,008 | 905 |
1. | Including loans from banks and others and debentures |
2. | Including cash and cash equivalents, short-term deposits and restricted cash. |
Definition of OPC’s EBITDA and non-IFRS reconciliation
This press release, including the financial tables, presents EBITDA, which is considered to be a “non-IFRS financial measure.”
OPC defines “EBITDA” as for each period as net profit before depreciation and amortization, financing expenses, net, and income tax expense. EBITDA is not recognized under IFRS or any other generally accepted accounting principles as a measure of financial performance and should not be considered as a substitute for net profit or loss, cash flow from operations or other measures of operating performance determined in accordance with IFRS. EBITDA is not intended to represent funds available for dividends or other discretionary uses because those funds may be required for debt service, capital expenditures, working capital and other commitments and contingencies. There are limitations that impair the use of EBITDA as a measure of OPC's profitability since it does not take into consideration certain costs and expenses that result from OPC's business that could have a significant effect on net profit, such as financial expenses, taxes, depreciation, capital expenses and other related items.
OPC believes that the disclosure of EBITDA provides transparent and useful information to investors and financial analysts in their review of the company’s, or its subsidiaries’ operating performance and in the comparison of such operating performance to the operating performance of other companies in the same industry or in other industries that have different capital structures, debt levels and/or income tax rates.
Set forth below is a reconciliation of OPC’s net profit to EBITDA for the periods presented. Other companies may calculate EBITDA differently, and therefore this presentation of EBITDA may not be comparable to other similarly titled measures used by other companies.
For the six months ended June 30, | ||||||||
2019 | 2018 | |||||||
$ millions | ||||||||
Net profit for the period | 14 | 16 | ||||||
Depreciation and amortization | 15 | 15 | ||||||
Financing expenses, net | 15 | 14 | ||||||
Income tax expense | 5 | 6 | ||||||
EBITDA | 49 | 51 |
For the three months ended June 30, | ||||||||
2019 | 2018 | |||||||
$ millions | ||||||||
Net profit for the period | - | - | ||||||
Depreciation and amortization | 8 | 8 | ||||||
Financing expenses, net | 10 | 9 | ||||||
Income tax expense | - | 1 | ||||||
EBITDA | 18 | 18 |
Summary Financial Information of OPC’s Subsidiaries
The tables below set forth debt, cash and cash equivalents, deposits and restricted cash for OPC’s subsidiaries as of June 30, 2019:
OPC-Rotem | OPC-Hadera | Tzomet | Others | Total OPC | ||||||||||||||||
Debt (excluding accrued interest) | 352 | 186 | - | 80 | 618 | |||||||||||||||
Cash and cash equivalents and short term deposits | 40 | 10 | 1 | 111 | 162 | |||||||||||||||
Restricted cash (including debt service reserves) | 59 | 2 | 1 | 26 | 88 | |||||||||||||||
Debt service reserves | 37 | - | - | 15 | 52 |
The tables below set forth debt, cash and cash equivalents, deposits and restricted cash for OPC’s subsidiaries as of December 31, 2018:
OPC-Rotem | OPC-Hadera | Others | Total OPC | |||||||||||||
Debt (excluding accrued interest) | 336 | 172 | 78 | 586 | ||||||||||||
Cash and cash equivalents and short term deposits | 26 | 12 | 77 | 115 | ||||||||||||
Restricted cash (including debt service reserves) | 46 | 2 | 24 | 72 | ||||||||||||
Debt service reserves | 24 | - | 13 | 37 |
Summary Operational Information of OPC
The tables below set forth details of sales, generation and purchases of electricity by OPC and availability and net generation of OPC split by the Rotem plant and the Hadera energy center (kWh in millions):
For the six months ended June 30, | For the three months ended June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Sales to private customers | 1,991 | 1,973 | 1,022 | 1,000 | ||||||||||||
Sales to the system administrator | 48 | 47 | 5 | 9 | ||||||||||||
Total sales | 2,039 | 2,020 | 1,027 | 1,009 |
For the six months ended June 30, | For the three months ended June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Net generation of electricity | 1,932 | 1,930 | 948 | 954 | ||||||||||||
Purchase of electricity from the system administrator | 107 | 90 | 79 | 55 | ||||||||||||
Total volume of electricity generated and purchases from the system administrator | 2,039 | 2,020 | 1,027 | 1,009 |
For the six months ended June 30, | ||||||||||||||||
2019 | 2018 | |||||||||||||||
Availability (%) | Net generation (kWh in millions) | Availability (%) | Net generation (kWh in millions) | |||||||||||||
OPC-Rotem | 100 | % | 1,890 | 100 | % | 1,888 | ||||||||||
OPC-Hadera | 92 | % | 42 | 94 | % | 42 |
For the three months ended June 30, | ||||||||||||||||
2019 | 2018 | |||||||||||||||
Availability (%) | Net generation (kWh in millions) | Availability (%) | Net generation (kWh in millions) | |||||||||||||
OPC-Rotem | 99 | % | 929 | 100 | % | 936 | ||||||||||
OPC-Hadera | 92 | % | 19 | 93 | % | 18 |