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B_ IMPSA - 2Q 2011 Earnings Conference Call Presentation

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B_ IMPSA - 2Q 2011 Earnings Conference Call Presentation Powered By Docstoc
					     2Q11 Financial Results
COO Lucas Pescarmona & CFO Julio Dreizzen




                                    September 15, 2011
IMPSA’s Sustainable Business Model


      Leading renewable energy player in Latin American and a proven track
                  record of more than 100 years of experience

 •   Profitable resilient business with highly
                                                                             R&D
     attractive industry dynamics

 •   Largest wind power developer and one of




                                                  ene eneratio wer
     the two largest manufacturers of wind




                                                                                                   Cor
     and hydro equipment in Latin America




                                                              n
                                                     wable Po




                                                                                                       e Equipm
 •   Complete solutions provider

 •   Synergies between business units



                                                 R G




                                                                                                               en
 •   Strong backlog of more than US$3 billion




                                                                                                                 t
     and significant growth potential

 •   Highly experienced management team

 •   Technology innovator
                                                                             EPC
                                                                     NY004V7H-Process arrows.cdr                     2
Integrated Platform Built On Three Pillars(1)




   • Designs, manufactures and                               • Designs, manufactures and                                    • Develops and operates wind
      installs wind energy                                      installs custom-made equipment                                 farms
      generators and ancillary                                  for hydro generation projects:                              • Capital gains in windfarms
      equipment                                                 “One-stop-shop” with water-to-
   • Leading wind equipment                                     wire solutions                                              • Development of more than
                                                                                                                               1,000 MW in wind farms:
      manufacturer in LatAm                                  • Top 10 global hydro player and
   • Proprietary (UNIPOWER®)                                    leader in LatAm                                                      •   254 MW Operating
      and licensed technology                                • State-of-the-art hydro                                                •   344 MW Under
      (Vensys)                                                  laboratory                                                               Construction
   • More than 400 MW already                                • More than 22,600 MW already                                           •   545 MW Awarded with
      installed and under                                       installed and 17,000 MW under                                            PPAs
      construction                                              execution
                                                                                                                            • Focused on projects in Brazil,
   • Over 1,000 MW under                                     • Excellent track record for more                                 rest of Latin America with
      execution turbine backlog                                 than 75 years                                                  credit-worthy off-takers
 Notes:
 (1)    The Company has also a non-core business unit dedicated to waste collection and waste management in Argentina and Colombia                          3
Long-Term Relationships Key to Success



 103-year history (25
 103-year history (25
   years in Brazil)
   years in Brazil)



    87% customer
    87% customer
retention rate over last
retention rate over last
        10 years
        10 years




Strategic Relationships
Strategic Relationships




Access to Competitive
Access to Competitive
     Financing
     Financing



                                         4
Leading Hydro and Wind Equipment
Manufacturer in Latam and Brazil



 Market share (LatAm)
 Market share (LatAm)                                               Market share (Brazil)
                                                                    Market share (Brazil)


                                 Others                                                       Others
                                                       IMPSA                             Alstom11%                IMPSA
                                  11%
                                                        20%                                2%                      22%
                                                                                      Siemens
                      Voith                                                            3%
                                                                                    Gamesa
                      18%
                                                                                      8%

                                                                                      Suzlon                       Wobben
                                                                                       16%                          21%
                                                        Alstom
                           Andritz
                                                         33%                                           GE
                            18%
                                                                                                      17%




              2007 – 2011 (1)                                               2007 – 2011 (1)

Source: McCoy, Waterpower and Dams Construction and CAS and IMPSA   Source: Emerging Energy Research (EER), BTM Consult, Bloomberg and IMPSA

Notes:
(1)    2011 is an estimate for the end of the period                                                                                           5
Energy: LatAm’s Largest Wind Developer

  IMPSA Energy has more than 1,000MW under execution and over 1,900MW under development
  IMPSA Energy has more than 1,000MW under execution and over 1,900MW under development




                                                                    Brazil
                                                In commercial Operations (MW)                    254


                                                Under construction (MW)                          279


                                                Awarded with PPAs (MW)                           390


                                                TOTAL MW                                         923


                                               One of the largest investors in Proinfa, and in the
                                               One of the largest investors in Proinfa, and in the
                                                   2009 and 2010 Brazilian Wind Auctions
                                                    2009 and 2010 Brazilian Wind Auctions


                                          Argentina                                            Uruguay
                          MW awarded in 2010                  155         Under Construction             65

                          TOTAL MW                            155         TOTAL MW                       65


                                                                                                              6
2Q11 Operational and Financial Highlights

  LTM consolidated Sales of US$1,146 million and YTD 2011 consolidated Sales of
  US$585 million

  LTM consolidated EBITDA reached US$153 million

  Roughly 60% of sales are being generated in Brazil

  IMPSA signed agreements for more than US$3.4 billion in wind and hydro projects

  IMPSA won the Valor Economico award as the #1 metallurgical company in Brazil

  IMPSA was awarded 120 MW from the 1,218 MW auctioned on the 4th Leilão de
  Energia de Reserva (Brazilian Reserve Energy Auction)

  IMPSA will supply 246 MW in Unipower ® Wind Turbines to Eletrosul (50% of MW
  awarded to Eletrosul)


                                                                                    7
Sales and EBITDA – Double-Digit Growth

 (US$ million)                                      (US$ million)
                  Sales                                             EBITDA




                     • Outstanding economic performance and increasing demand for energy
Core Growth Drivers: • Increased demand potential from Brazilian clients
                     • Brazilian factory has helped ensure market participation and cheap
                       financing since 2008
                                                                                            8
Backlog & Sales –Brazil Represents Over 50%

 LTM Sales1: US$1,146 million   Manufacturing Backlog 1: US$3,464 million




       Other                               Other
        42%         Brazil                             Brazil
                                            46%
                    58%                                54%




         Energy &
          Other
           10%                                          Hydro
                      Hydro
                       39%                               36%


       Wind                                Wind
       51%                                 64%

                                                                Notes:
                                                                1: As of July 31, 2011   9
Strong Backlog Translates into Visible and
Stable Cash Flow

          IMPSA’s manufacturing backlog and energy pipeline
            provides stability in the short and medium term
                                             Manufacturing Backlog
                       3,500                                                              3,464
                                                                         3,166    3,084
                       3,000
         US$ million




                       2,500
                                                                 2,150   1,731            2,209
                                                                                  1,797
                       2,000

                       1,500                            1,327    1,225

                       1,000                            507
                                                                         1,435    1,287   1,255
                        500                    992      820       925
                               426    478
                          0
                               2005   2006     2007     2008     2009    2010    1Q 2011 2Q 2011

                                                      Hydro     Wind


• 2010 Sales & EBITDA result from 2009 backlog monetization
• An increase in backlog will lead to an increase in both Sales and EBITDA
                                                                                                   10
Cash Flow Reflects Long-Term Strategy

                                                                 Net Cash Flow

                          100
                                                                                                                    YTD 2011
                                     61                                                  61
                           50                                            39

                                                          (21)                                         (28)               2
         (US$ million)




                            0
                                 Operational Intangible   Capex        Net            Non           Interests         Others
                                   Funds       Assets                Recourse       Recourse
                          (50)                                         Debt           Debt


                         (100)

                                                (113)
                         (150)


 • Long Term Non-Recourse Debt to finance our Capex in wind farm concessions in Brazil (intangible assets)
 • IMPSA Energy today generates 166MW in wind operations and by year-end expects to increase to 320
   MW
     IMPSA’s differences in cash flow arise from IFRIC 12 application (application of specific accounting parameters to
     specific IMPSA Energy Capex) and the difference produced by wind farm sales.                                              11
 Corporate Debt Profile
 Focus on Extending Maturities


                                                                               390.0



                                                                                                 Project Finance
93.4    96.1                                                                                          Debt
                                                                                                      29%
                          55.5
                 35.1
                                                                                                    Corporate
                                     9.8    9.8      10.9    7.5                                      Debt
                                                                                                      71%

2011   2012     2013      2014       2015   2016    2017     2018    2019      2020
       Bond Debt                                   CAF
       Expo Prefinancing (rolling)                 Working Capital & ST Debt
                                                                                       Debt Structure (U$S mm)
       WPE LT Financing                            ON 2020                             Corporate Debt            708
                                                                                       Project Finance Debt      287
                                                                                       Total Debt                995

                                                                                       2020 Bond represents over 50%
                                                                                       of financical debt


                                                                                                                       12
Big Winner AT Brazil’s Energy Auction (Leilão 2011)


  The results of the Leilão reflects our strong execution capabilities and reinforces our
  The results of the Leilão reflects our strong execution capabilities and reinforces our
                       leading market position within the industry
                        leading market position within the industry
  •   Two types of auctions: the Energia Nova A-3 (new
      energy) and Energia de Reserva (Capacity), with
      2.7GB and 1.2GB awarded, respectively
  •   A total of 1.9 GW of Wind Power were auctioned
  •   Out of the Energia de Reserva auction, IMPSA
      obtained 120MW in the "Ceara IV" project
  •   We have already agreed to sell 246MW of our
      Unipower ® equipment to the Electrosul/Rio Bravo
      consortium (50% of their 492MW awarded). This:
        •   Confirms the competitiveness of our own
            technology, Unipower ®
        •   Ensures a significant portion of next 2 years
            forecasted Wind sales coming from our existing
            backlog.
        •   Increases our third party sales changing the mix
            between internal and external clients                                           13
Our Strategy…



                        Focusing on renewable energy sectors in high growth
                        Focusing on renewable energy sectors in high growth
                        developing markets in Latin America
                        developing markets in Latin America
    To increase our
    leadership as a     Leveraging position as a fully integrated and full
                        Leveraging position as a fully integrated and full
      provider of       service player to capture synergies
                        service player to capture synergies
 integrated solutions
  in hydro and wind     Continuing with local presence and expanding our
                        Continuing with local presence and expanding our
     power in Latin     proven track record for quality and reliability
                        proven track record for quality and reliability
America by executing
     the following      Innovating and developing proprietary technology to
                        Innovating and developing proprietary technology to
       strategies       retain our competitive edge
                        retain our competitive edge


                        Expanding manufacturing capacity to gain key local
                        Expanding manufacturing capacity to gain key local
                        presence in select focus markets
                        presence in select focus markets

                                                                              14
     2Q11 Financial Results
COO Lucas Pescarmona & CFO Julio Dreizzen




                                    September 15, 2011

				
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