Neoen Capital Markets Day - 11 March 2021
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Neoen Capital Markets Day
11 March 2021
Disclaimer
This presentation contains forward-looking statements regarding the prospects and growth strategies of Neoen and its subsidiaries (the
“Group”). These statements include statements relating to the Group’s intentions, strategies, growth prospects, and trends in its results of
operations, financial situation and liquidity. Although such statements are based on data, assumptions and estimates that the Company
considers reasonable, they are subject to numerous risks and uncertainties and actual results could differ from those anticipated in such
statements due to a variety of factors, including those discussed in the Group’s filings with the French Autorité des Marchés Financiers
(AMF) which are available on the website of Neoen (www.neoen.com). Prospective information contained in this presentation is given only
as of the date hereof. Other than as required by law, the Group expressly disclaims any obligation to update its forward-looking statements
in light of new information or future developments.
2
Agenda for today
Time (CET) Section Speaker
09:00 – 09:10 Introduction Xavier Barbaro
09:10 – 10:00 FY 2020 results - Q&A Louis-Mathieu Perrin
10:00 – 10:50 Our differentiated and integrated strategy - Q&A Romain Desrousseaux / Jean-Christophe Cheylus
10:50 – 10:55 Break
10:55 – 11:05 Sustainability - Taking the next step Xavier Barbaro
11:05 – 12:00 2025 Roadmap - Q&A Xavier Barbaro / Louis-Mathieu Perrin
Xavier Barbaro Romain Desrousseaux Louis-Mathieu Perrin Jean-Christophe Cheylus
Chief Executive Officer Deputy Chief Executive Officer Chief Financial Officer Head of Energy management
3
Full-year 2020 results
1. FY 2020 highlights
2. FY 2020 results
3. Outlook
4. Appendices
5
2020 highlights
4.1 GW +1 GW 5.2 GW
In operation and under construction Newly awarded projects Secured(1)
299 M€ 270 M€(2) 222 M€
Revenue EBITDA Cash-flow from operating activities
up 18% y-o-y up 25% y-o-y up 20% y-o-y
(1) Assets in operation, under construction and projects awarded
(2) 274.8 M€ at constant exchange rates 6
Strong performance in 2020 end EBITDA target reached
Revenue (M€) EBITDA (M€) Secured capacity(1) (in GW)
+18% 298.8 +25% +1.0 GW
(1)
5.2
270.4
253.2
216.1
4.1
85% 90%
EBITDA margin EBITDA margin
2019 2020 2019 2020 31.12.2019 31.12.2020
• FY 2020 revenue up 18% year-on-year • 2020 EBITDA target achieved: 275 M€ at • More than 1 GW in newly awarded projects
constant exchange rate in 2020
• 2020 EBITDA margin of 90%, up 5 bp y-o-y
– Liquidated damages(2) covering, up to a cap, the
revenue losses related to the delayed
commissioning of certain projects
– One-off positive impact in storage in Q1 2020
(1) Liquidated damages recognized in other current operating income, partly offsetting losses of revenue,
thereby automatically improving the EBITDA margin 7
1. FY 2020 highlights
2. FY 2020 results
3. Outlook
4. Appendices
8
2020 revenue up 18% year-on-year
Revenue (in M€)
• Significant contribution from assets commissioned in 2019
and 2020 as well as early generation revenue recorded in
+40.3
2020
+12.3 298.8
-2.0
+17.3
-10.8 -6.9
-4.6 • Lower average price at a wind farm in Australia due to the
253.2 transition from early generation revenue(2) to PPA in the
first 9M 2020 and year-on-year decrease in market prices
in the last three quarters of 2020, especially in Australia
• Negative volume effect due to less favorable irradiation
conditions in Australia throughout 2020 and to reduced
availability of certain Australian assets in H1 2020
• Strong one-off increase in HPR battery revenue in Australia
in Q1 2020 partly offset by unfavorable market conditions
for the sale of network services over the rest of the year
• Negative FX impact mainly due to the weakening in the
average level of the Australian Dollar against the Euro;
(1)
2019 revenue Impact 2019 New capacity in Prices Volume Storage Other FX 2020 revenue
commissioning 2020 Australia
revenue up 20% at constant FX rates
(1) Based on average FX rate over 2019
(2) Short-term energy revenues prior to the start of a long-term contract 9
Solid growth in 2020 EBITDA
EBITDA (M€)
(1)
+12.9 -18.0
+54.9 +1.0 -6.6 +13.6 -4.1
270.4
• EBITDA up 25% year-on-year mainly driven by the
+0.5
revenue growth in Solar in Americas, in Wind in Europe-
Africa and in storage in Australia
216.1
• EBITDA margin of 90%, up 5 bp year-on-year due to
liquidated damages(2) covering, up to a cap, the revenue
85% 90%
EBITDA margin EBITDA margin losses caused by delayed commissioning of certain
projects and a one-off positive impact in Storage in Q1
2020
2019 Americas Europe-Africa Australia Europe-Africa Australia Europe-Africa Australia Other 2020
(1) Development - Investment and Eliminations
(2) Liquidated damages recognized in other current operating income, partly offsetting loss of revenue,
thereby automatically improving the EBITDA margin 102020 EBITDA by segment: solar
2020 2019 % chg.
Solar 161.2 111.8 +44%
% margin 112% 94% +18bp
Wind 97.2 102.2 -5%
% margin 80% 92% -12bp
Storage 31.4 17.4 +80%
% margin 96% 85% +11 bp
Other(1) (19.4) (15.3) -27%
Group EBITDA 270.4 216.1 +25%
Group EBITDA margin 90% 85% +5bp
• Solar EBITDA up 44% year-on-year
+ Strong contribution from new capacity added in 2020, notably in El Salvador and in Mexico, and, to a lesser extent, full-year
impact from assets commissioned in 2019 in Australia, Zambia, Jamaica and France
+ Significant increase in liquidated damages in 2020 compared to 2019, directly linked to delayed commissioning, especially in
Americas
Lower irradiation conditions in Australia throughout the year and reduced availability of an Australian asset in H1 2020 due to
upgrade works on the grid
In the last three quarters of 2020, lower market prices notably in Australia compared to 2019
(1) Development - Investment and Eliminations 112020 EBITDA by segment: wind
2020 2019 % chg.
Solar 161.2 111.8 +44%
% margin 112% 94% +18bp
Wind 97.2 102.2 -5%
% margin 80% 92% -12bp
Storage 31.4 17.4 +80%
% margin 96% 85% +11 bp
Other(1) (19.4) (15.3) -27%
Group EBITDA 270.4 216.1 +25%
Group EBITDA margin 90% 85% +5bp
• Wind EBITDA down 5% year-on-year
+ Contribution of capacity added in Ireland and in France in 2019 as well as in Finland and France in 2020
+ Ramp-up of Bulgana in Australia, which gradually injected electricity into the grid in H2 2020
Lower average price earned by the Hornsdale 3 wind farm in Australia in the first 9M 2020 following the entry into force of its long
term PPA in October 2019
Decrease in liquidated damages in 2020 compared to 2019, essentially in Australia
Higher network service costs at certain wind farms in South Australia in Q1 2020 due to specific market conditions
(1) Development - Investment and Eliminations 122020 EBITDA by segment: storage
2020 2019 % chg.
Solar 161.2 111.8 +44%
% margin 112% 94% +18bp
Wind 97.2 102.2 -5%
% margin 80% 92% -12bp
Storage 31.4 17.4 +80%
% margin 96% 85% +11 bp
Other(1) (19.4) (15.3) -27%
Group EBITDA 270.4 216.1 +25%
Group EBITDA margin 90% 85% +5bp
• Storage EBITDA up 80% year-on-year
+ Strong one-off positive impact in Q1 2020 in Australia due to specific market conditions (power interconnection line down for 18 days)
Storage revenue in the last three quarters of 2020 declined year-on-year as weaker demand for electricity in Australia during the
period reduced strain on the grid, creating less favorable market conditions for sale of network services
(1) Development - Investment and Eliminations 13Profit & Loss: from revenue to operating income
2020 2019 Change
Revenue 298.8 253.2 +18%
EBITDA 270.4 216.1 +25%
Current operating depreciation, amortization and Increase in depreciation and amortization resulting from the growth in
(109.8) (80.2) +37%
provisions the number of assets in operation related to new commissionings in 2019
and 2020
Current operating income 160.5 135.9 +18%
Other non-current operating income and expenses (4.0) (5.5) -27%
Impairment loss related to the Altiplano project in 2020 (-15.3 MUSD)
Impairment of non-current assets (14.1) 1.5 n/a
– Slow recovery of VAT credits denominated in Argentine peso pending
Operating income 142.4 131.9 +8% reimbursement in a context of declining ARS against USD
– Impact of currency control measures currently in place
14Profit & Loss: from operating income to net income
2020 2019 Change Cost of debt reflecting
– Growth in assets in operation (-10.7M€) and impact of hedging
Operating income 142.4 131.9 +8% derivatives (-9.7M€)
– Interest expense related to the issue of two convertible bonds(1)(2)
Cost of debt (101.8) (79.0) +29% (-10.7 M€)
Other financial income and expenses (15.9) (8.0) x2 – Positive impact on interest expense of the refinancing of the Hornsdale
wind farms in Australia in 2020 (+3.3 M€) and a portfolio of French
Net financial result (117.7) (87.0) -35% projects in H2 2019 (+5.5 M€)
Income tax (21.4) (23.7) -10% Other financial income and expenses
– Costs associated with the early repayment of the historical debt related
Net income from continuing operations 3.3 21.2 -84% to the refinancing of the Hornsdale wind farms in 2020 (-4.9 M€)
Net income from discontinued operations - 15.8 n/a – Foreign exchange losses in 2020 reflecting the decreasing value of
current assets in Argentina (-8.5 M€)
Net income of the consolidated group 3.3 37.0 -91% – In 2019, one-off penalties related to the refinancing of French assets
and discounting effects partly mitigated by positive impact of the
Net income Group share 3.9 36.0 -89%
refinancing of a portfolio of Australian solar projects
o/w net income attributable to non-controlling interests (0.5) 1.0 n/a
Effective tax rate of 86.6% vs 52.8% in FY 2019
(1) The effective interest rate of the debt component of these convertible bonds stands at 4.27% and
5.80% respectively
(2) Issued respectively in October 2019 and in June 2020 15Current and deferred tax expenses
2020 2019 Change
Current tax expenses, down 5% year-on-year
Profit before tax 24.8 44.9 -45% – Corporate tax expenses: -2.8 M€ year-on-year
Income tax (21.4) (23.7) -10% – Withholding tax expenses: +1.7 M€ year-on-year
– CVAE(1) tax expenses: +0.4 M€ year-on-year
Current tax expenses (14.5) (15.3) -5%
Deferred tax expenses (6.9) (8.4) -18%
Deferred tax, down 18% year-on-year
Effective tax rate 86.6% 52.8% +34 bp
(1) France’s value added levy 16From theoritical tax rate to effective tax rate in 2020
+2.8% 86.6%
+12.0%
+18.8%
+6.9%
+2.7%
+10.5%
+4.9%
28.0%
Current tax Permanent differences Deferred tax
(1)
Theoretical tax rate CVAE tax Withholding tax IFRS 2 Non-deductible share Non recognition of Hyperinflation Other Effective tax rate
of interest of losses carried Argentina
convertible bonds forward
(1) France’s value added levy 17Cash position at Group level at year-end 2020
Change in total cash balance (M€)
• Net cash flows from operating activities amounted to 222 M€ up 38M€ y-o-y
reflecting notably
+222 – Increase in EBITDA (+54 M€ y-o-y)
– Negative change in WCR (-11 M€ y-o-y) mainly due to receivable pending payments
– Increase in tax paid (-8 M€ y-o-y)
460 +267 • Net cash flows from investing activities reached -502 M€, driven by
(1)
+12 375 investments in new projects mainly
– In Australia: HPRX (53 M€), Western Downs (37 M€), VBB (25 M€), Bulgana (17 M€)
-75 -9
– In Americas: Altiplano (61 M€), El Llano (48 M€) and Capella (23 M€)
– In Europe: Mutkalampi (36 M€), Yllikkäla (13 M€), Hedet (11 M€), wind farms (73 M€)
& solar projects (45 M€) in France
-502
Net cash from financing activities • Net cash flows from financing activities reached 204 M€ mainly reflecting net
= 204 M€ Increase in borrowings related to
Opening cash Net cash from Net cash used in Net increase in Interests paid Other FX Closing cash – Project financing raised with the construction of new assets
balance operating investing borrowings balance
31.12.2019 activities activities 31.12.2020
– Issuance of a 170 M€ green convertible bond in June 2020 (143 M€ recognized as
debt component)
– Net impact of the refinancing of a portfolio of wind assets in Australia
375 M€(2) of cash available at 31 December 2020
plus a 200 M€ undrawn syndicated loan
(1) The other items mainly include the equity portion of the green convertible bond, net acquisition of treasury
shares and dividends paid to minority shareholders
(2) Cash and cash equivalents stood at 60.4 M€ at Neoen SA (vs 185.4 M€ in 2019) 18Gross debt increasing with the construction of new assets
Change in gross debt (M€)
• Net Increase in borrowings of 267 M€
+794 -528 – Additional project financing raised with the construction of new assets
+178 – Issuance of a 170 M€ green convertible bond in June 2020 (143 M€
+433 recognized as debt component)
-350 +58 +9 +30 +10 -39 2 749 – 11 M€ net impact of the refinancing of Hornsdale wind assets in Australia
+361 +11 M€ net impact
• Change in fair value of derivatives derived from decrease in market
2 415 from the refinancing interest rates in FY 2020
of a portfolio of wind
assets in Australia
• Average cost of project finance debt: 3.4% (vs 3.7% at end-2019)
due to low interest-rates environment until year end and one refinancing
transaction
• Average Group cost of debt: 3.7% (vs 4.2% at-end 2019) due to
lower cost of project finance debt and the issue of a green convertible
bond in June 2020 at a nominal interest rate of 2.0%(1)
31.12.2019 New Repayment Change in fair Accrued IFRS 16 Other FX 31.12.2020
borrowings value of interest
derivatives
>80% non-recourse debt, with long tenor
(1) The effective interest rate of the debt component of this convertible bond stands at 5,80% 19Financial discipline maintained
Net debt (in M€) Average residual tenor of project finance debt(1) (in years)
18.0
2 267 15.1 15.4
+456 M€
1 811
EUR AUD USD
16.3 years
Weighted average residual tenor(2)
(15.8 years at 31.12.2019)
Gross debt by currency(3)
31.12.2019 31.12.2020
USD
Stable leverage 19%
8.4x net debt / EBITDA at 31.12.2020
(8.4x at 31.12.2019) EUR
50%
AUD
31%
Other
(1) Senior debt (excluding junior debt) 0.3%
(2) For all the Group’s projects in operation as of December 31, 2020
(3) Excluding lease liabilities and minority interests. As of December 31, 2020 201. H1 2020 highlights
2. H1 2020 results
3. Outlook
4. Appendices
211.4 GW under construction across our three geographies
EUROPE - AFRICA
254 MW under construction
France
Solar(1) - 132 MWp
Wind(2) - 80 MW
CODs expected between
2021 and H1 2022
AMERICAS AUSTRALIA
208 MWp under construction 974 MW under construction
Mozambique
Metoro - 41 MWp
Argentina Australia
COD expected in H2 2021
Altiplano - 208 MWp Western Downs – 460 MWp
COD expected in Q3 2021 COD expected in Q4 2022
Australia Australia
Victorian Big Battery – 300 MW / 450 MWh Bulgana - 214 MW
COD expected in Q4 2021 (incl. 20 MW / 34 MWh of storage)
COD expected in H2 2021
100 MW already injecting into the grid
(corresponding to 70% of the expected production)
Notes: Capacity under construction at December 31st, 2020. Current best estimate of the timing for commissioning
of assets under construction given the Covid-19 outbreak
(1) Arue 1,2, 3 (40 MWp), Mer (15 MWp), Réaup-Lisse (15 MWp), Bioule (13 MWp), Paulmy (12 MWp), Levroux (10 MWp),
Morhange (9 MWp), CapVert (5 MWp), Sernhac (5 MWp), Badonviller (4 MWp), Savernat (4 MWp)
(2) Le Mont de Malan (29 MW), Saint-Sauvant (21 MW), Courcome (15 MW), Les Avaloirs (9 MW), Chemin Vert (7 MW) 222020 confirming Group’s sustainable growth profile
• 769 MW of additional assets in operation in 2020
• Significant progress on the delivery of projects
• Launch of construction of close to 1 GW
despite some localized delays
• More than 1 GW in newly awarded projects
• The 300 MW Victorian Big Battery, one of the world’s largest
• Distinctive and innovative projects batteries
• A cross-border PPA for the Mutkalampi wind farm (126 MW)(1)
in Finland with a consortium of four major Dutch groups
• FY 2020 revenue: up 18 % year-on-year
• Solid financial performance and
• FY 2020 EBITDA: up 25% year-on-year
2020 EBITDA target reached
• Cash-flow from operations: up 20% year-on-year
• At the forefront of sustainable finance with • A syndicated loan indexed to ESG criteria - 200 M€
two successful green issues • The first ever European green convertible bond - 170 M€
(1) Total capacity of 404 MW, of which 251 MW accounted in the awarded projects at end-December 2020 23Our differentiated and integrated strategy
1. Batteries – A cornerstone of our competitive offer
2. Corporate PPAs – Innovating in a growing practice
3. Energy Management – Our key differentiator
25Batteries: A cornerstone of our competitive offer
Neoen has chosen lithium-ion as its preferred technology
Competitive advantages Key suppliers
1 Reliable 5 Benefitting from An open architecture with a number
quickest cost of different suppliers
2 Easy to roll-out reductions
3 Scalable 6 Available from several
different suppliers
4 Fast-response 7 Bankable
27Two different models to connect storage assets
Behind the meter Stand alone
• Integration within a solar or wind farm • Direct connection to the grid
as a single profit unit • Dedicated legal entity with its own P&L
• Electricity output sold on a blended • Option to co-locate the battery with another Neoen project to share infrastructure
basis and benefit from cost synergies
Albireo Power Reserve within Capella Yllikkälä Power Reserve in Finland Hornsdale Power Reserve in Australia
solar farm in El Salvador (independent site) (co-located site)
28A successful global track record since 2015
EUROPE AUSTRALIA
Yllikkälä Power Reserve Azur Stockage Victorian Big Battery Hornsdale Expansion (HPRx)
Finland 2020 France 2018 Victoria 2021 South Australia 2019
Bulgana Storage Hornsdale Power Reserve
AMERICAS
Albireo Power Reserve
Victoria 2017 South Australia 2017
De Grussa
El Salvador 2020
Western Australia 2015
Neoen is a leading player in storage with 515 MW / 717 MWh capacity
29Neoen fully owns landmark storage assets - 1 DeGrussa (2015) Hornsdale Power Reserve (2017) Largest off-grid solar & storage project Largest lithium-ion battery worldwide Behind the meter 6 MW / 1.4 MWh Stand alone (co-located) 100 MW / 129 MWh Bulgana Storage (2017) HPRx (2019) Hybrid wind & storage project Extension of the largest Australian battery project Behind the meter 20 MW / 34 MWh Stand alone (co-located) 50 MW / 65 MWh Note: Statistics at the time of commissioning 30
Neoen fully owns landmark storage assets - 2 Azur Stockage (2018) Yllikälä Power Reserve (2020) Largest battery in France Largest battery in the Nordics Stand alone (co-located) 6 MW / 6 MWh Stand alone 30 MW / 30 MWh Albireo Power Reserve (2020) Victorian Big Battery (2021) First and largest battery in Central America Largest battery in Southern Hemisphere Behind the meter 3 MW / 2 MWh Stand alone 300 MW / 450 MWh Note: Statistics at the time of commissioning 31
Dynamic combination of 3 economic models to increase
competitiveness
Frequency Network Firming renewables
support + reliability + and arbitrage
Stabilise the grid Support the network through Smoothen the intermittency
everyday exceptional events of renewables
Daily service fee auctioned Long-term capacity contracts with the Better prices obtained from off-takers
by the grid operator network operator to reward more adequate power
production profiles
Albireo Power Reserve Hornsdale Power Reserve
Azur Stockage HPRx Bulgana
Yllikkälä Power Reserve Victorian Big Battery De Grussa
Hornsdale Power Reserve
(merchant part)
Victorian Big Battery
(merchant part)
32Neoen has been building valuable know-how in storage
Competitiveness increased by significant operational expertise accumulated over the last 5 years
Operations Control Centre since 2017
Providing 24/7 asset monitoring
Real time optimization of Neoen’s assets
in Australia
Unique experience in dispatching batteries on
the Australian grid: more than 4,600 bids per day
33Neoen is building one of the world’s largest batteries
Victorian Big Battery
Large project with combined model:
• Nov-20: Neoen won a Victorian Government tender for 250 MW capacity contracted for
11 years with the Victorian state grid, allowing to optimize the interconnector between
Victoria and New South Wales
• Additional 50 MW will be dedicated to frequency support and firming
Bankable:
• Feb-21: attractive financing secured from the Clean Energy Finance Corporation (CEFC)
for 160 MAUD senior debt facility
Fast to roll out:
• Short lead time of 2 years from beginning of development
(Q4 2019) to COD (Q4 2021)
Long-term business model:
• Expected lifetime of 20 years with supplier performance guarantees
300 MW / 450 MWh Q4 2021
Total capacity Expected COD Partners
34Storage is an essential pillar of Neoen’s growth story
Future developments … as well as in Europe
in Australia… and in the Americas
• Reinforce Neoen’s leading position in Australia with the • Leverage Australian experience in Europe and the
ambition to operate at least one large battery in each state Americas
• Add value to our solar and wind projects • Offer innovative solutions for grid operators and off-takers
• Offer diversified services to counterparties • Be among the leaders in storage in the countries where we
operate
Storage represents 10% of Neoen’s total capacity today
and this proportion is expected to remain in the future
35Corporate PPAs: Innovating in a growing practice
The corporate PPA market is attractive and fast growing
Global market of corporate PPAs (in GW) Market growth is driven by the broadening profile of off-takers
Examples Required capacity
• Retailers >100 MW
Utilities
22.9 GW
x9 • Power intensive companies
Very large • Looking for cheaper power >100 MW
power sources
2.5 GW consumers
• Multi-sector players for
whom energy is a non-core
2014 2020 activity
Medium • Looking to reduce carbon
CAGR 2014-2020: +45% footprint and procure 10-50 MW
power
clean energy
consumers
• Untapped opportunity for a
sophisticated IPP like Neoen
Source: Bloomberg New Energy Finance 371.3 GW of corporate PPAs contracted since 2015
15
off-takers
in 4
countries
2015 2016 2017 2018 2019 2020
Solar
Neoen’s
Wind
offer
Storage
Energy management
38Combining 5 PPAs to develop the largest wind farm in Finland
Mutkalampi 404 MW wind project in Finland
Optionality to further contract post COD
Signed Dec-2020
Signed Sept-2019
125 MW 126 MW 153 MW
The ability to gradually aggregate several corporate PPAs enabled us to secure a large project
and achieve economies of scale in a country that does not offer single contracts of that size
39The ability to sign cross-border contract is a game-changer
Mutkalampi Finnish grid
€/kWh Sophisticated arrangement to offer PPA access to
companies seeking lower unitary volumes
2
1 5 Innovative solutions, through volume transfer
PPA GOO
between off-takers
3
Settlement
transfer Flexibility to adapt to each off-taker’s risk
(€/kWh) requirements within a unique contractual framework
4
Utility supplier consortium
Advised by
0 1 1 1 1
Off-taker €/kWh Local grid
Source: EPA 40Our corporate PPA strategy is driving our competitiveness
Trigger demand for green corporate Aggregate PPAs from several
1 mid-sized off-takers
2
PPAs (including cross-border)
1
2
Offer competitive
5 electricity prices
5
Develop a larger project to
3 serve the off-takers
from a single site, 3
Secure attractive financing
4
hence achieving
4 terms (leveraging higher
economies of scale
contracted volumes and diversified
counterparty risk)
41Neoen’s strong competitive advantages for corporate PPAs
Competitiveness Long-term Sophistication Excellence
reliable partner in C.S.R.
• Exploit highest • Develop-to-own strategy • Expertise in storage, • Close relationships
wind/solar resource customised contracts with communities
potential • Extensive experience
and energy management
reducing execution risk • Global excellence in
• Develop large scale Corporate Social
projects Responsibility
Ideal combination to address off-takers’ needs
42Energy Management: Our key differentiator
More capabilities are now required to grow in today’s
increasingly complex markets
Larger, more cost- An evolving demand Power networks
efficient projects from corporates under stress
Combination of several PPAs and Increasing pool of clients requiring Less stable grids requesting
some merchant exposure in one more tailored solutions multiple services to integrate more
single project renewable energy
This will play to the strength of a sophisticated IPP like Neoen
44Competitive leadership thanks to energy management
Energy management team fulfills 3 interdependent missions to create value
1 Asset optimisation with real time decision-making on electricity markets
Neoen’s
growing
energy 2 Risk management and hedging of merchant position
management
platform
Tailored solutions to grid operators and off-takers, integrating wind, solar,
3
storage and trading in innovative offers
Neoen’s ambition is to become the best-in-class IPP thanks to its differentiated and integrated strategy
45Sustainability - Taking the next step
Neoen is dedicated to the energy transition…
4,396 GWh 4,1 GW +745 MW 15 Countries ≥ 5 GW
Clean competitive energy Installed Installed capacities International Target
produced in 2020 capacity in 2020 player for 2021
47… and is advancing global development goals
Delivering clean energy to reduce emissions Promoting access to affordable energy
Neoen develops, owns and operates large-scale Neoen’s wind and solar projects deliver
wind, solar and battery storage projects around the competitively priced energy, exerting downward
world, helping to accelerate the pace of transition pressure on electricity prices
48But sustainability is not new to us
200 M€
syndicated loan linked
to ESG criteria – 2020
170 M€
first ever European Green
Convertible Bond – 2020
Community fund Agrisolar Art & sponsorship Gender index 92/100 Green finance
...as recognized by Vigeo Eiris
TOP 4%1
(1) Neoen has been ranked in the Top 4% among the companies assessed 49Now we want to take it the next level
+
50Our framework is anchored by 3 foundational pillars
Our people Our projects Our communities
Working together to speed up Driving excellence Participating in the transition
the transition in sustainability with us
51Our people: working together to speed up the transition
Working Ethically Encouraging Diversity Reducing Emissions
Respect and protect our core value of Respect for the principles of fairness, Respect for the planet and the environment,
integrity at all levels of the company inclusion and non-discrimination, encouraging monitoring and mitigating our carbon footprint
gender balance
ACTIONS ACTIONS ACTIONS
• 100% of our employees formally commit to • Exceed industry benchmark of 32% women • Calculate our global carbon footprint
Neoen’s Code of Conduct working at Neoen, in each of our regions (including scope 1, 2, 3)
• 100% of our employees formally commit to • Increase annually the percentage of • Support roll-out of at least one additional
Neoen's Anti Corruption code and are management positions held by women “Greener Neoen1” initiative each year: in
trained in the fight against corruption 2021, 100% offset of the company’s travel
emissions
(1) “Greener Neoen” is a spontaneous internal think tank which objective is to drive Neoen to go “above and beyond” on the
aspects of our business that relate to emissions reductions and the environment 52Our projects: driving excellence in sustainability
Prioritising Safety Protecting Biodiversity Integrating Recycling
Maintaining a robust health and safety culture Monitoring, limiting and mitigating our Planning for future decommissioning of plants
for our employees, contractors and environmental and biodiversity impact across and recycling of all materials
subcontractors the project lifecycle
ACTIONS ACTIONS ACTIONS
• Collate & report frequency and severity of • Conduct environmental impact assessment • Identify recycling channels for all our
accident and incident rates of our by expert ecologists on 100% of sites during activities
contractors development
• Integrate a recycling commitment clause into
• Conduct HSE compliance audit on 100% • Offset any unavoidable environmental all new supply agreements, in countries with
of construction sites, monthly on sites > 20 impact in accordance with local a mature recycling industry
MW in size, every 2 months on smaller sites requirements, with each project selecting
one 'above and beyond' biodiversity initiative
53Our communities: participating in the transition with us
Consulting & Engaging Economic Development Benefit-Sharing
Developing genuine, open and ongoing Delivering local and regional economic Tailoring community benefit-sharing initiatives
relationships with local communities and development through employment, supply with and for the local community
stakeholders chain outcomes and skills development
ACTIONS ACTIONS ACTIONS
• Conduct community consultation and • Engage with local business and employment • Develop a benefit-sharing initiative for each
information-sharing on all projects during networks, prioritising local suppliers and new project over 50 MW
development, even if not mandated jobseekers where possible
• Create an artwork that celebrates the
• Develop a Community Engagement Plan1 • Local Participation Plan2
developed for encounter between renewable energy
for 100% of our new projects over 50 MW projects over 100 MW in scale and local culture for each new project over
in scale 50 MW in size
(1) Community Engagement Plan is a comprehensive internal tool which guides and maps our consultation and engagement across a
project’s lifecycle from early stages of assessing feasibility through until decommissioning | (2) Local Participation Plan is a sister document
to the Community Engagement Plan which identifies and maps potential local and regional economic outcomes such as job creation, supply
chain opportunities, apprenticeships and training. 54Sustainability is in our DNA !
Our Our Our
People Projects Communities
552025 Roadmap
1. Growth journey since IPO
2. Neoen today
3. Renewable energy market outlook
4. 2025 targets and strategy
5. Investment envelope and criteria
6. Approach to leverage
7. Source of funds
8. Short-term and medium-term outlook
57We have a very strong track record of growth
Assets in operation and under construction(1) (in GW) Revenue(1) (in M€)
CAGR 2016-2020 CAGR 2016-2020
+ 46% + 44%
4.1 299
253
3.0 207
2.2
1.5 132
0.9 70
2016 2017 2018 2019 2020 2016 2017 2018 2019 2020
Secured portfolio(1) (2) (in GW) EBITDA(1) (in M€)
CAGR 2016-2020 CAGR 2016-2020
+ 36% 5.2 + 51%
270
4.1
216
3.1
2.8 167
1.4 102
52
2016 2017 2018 2019 2020 2016 2017 2018 2019 2020
(1) Restated for the biomass business sold in September 2019
(2) Assets in operation, under construction and projects awarded 58We have a balanced, high-quality portfolio
Technology breakdown Geographic breakdown Contracted vs merchant breakdown(4)
8% 4%
At IPO
45% 1.8 GW (1)(2) 55% 39% 1.8 GW (1)(2) 53% 1.8 GW (1)(2) 96%
13% 12%
22%
2020
24% 4.1 GW(3) 63% 4.1 GW(3) 47% 4.1 GW(3) 88%
31%
Solar Wind Storage Australia Europe-Africa Americas Under PPA Merchant
(1) Capacity in operation or under construction as of June 30, 2018 | (2) Restated for biomass business sold in
September 2019 | (3) Capacity in operation or under construction as of December 31, 2020 | (4) Weighted average by
MW for assets in operation or projects under construction as of December 31, 2020 59Strong value creation for shareholders
Share price performance since IPO Strong increase in liquidity
2018 2019 2020 2021(1)
47.8€
at 09.03.2021 Daily volume Euronext €1,6m €0,8m €4,5m €12,6m
Market capitalization(2) €1.6bn €1.8bn €3.3bn €4.9bn
IPO price: 16,5€
Floating capitalization(2) €430m €623m €1,225m €1,805m
Source : Factset
Neoen SBF 120 (rebased) Running average (3m)
Share price performance : x2.9 since IPO
(1) At 9 March 2021 | (2) Yearly average 60Neoen today
We are a global, pure player in renewable energy
EUROPE-AFRICA
163 employees
AMERICAS 1 268 MW
(in operation or under construction)
37 employees
878 MW Finland
(in operation or under construction)
Sweden
USA
Ireland
Mexico
El Salvador
Croatia AUSTRALIA
France 55 employees
Jamaica
1 905 MW
Portugal (in operation or under construction)
Ecuador
Zambia Australia
Argentina
Mozambique
Countries with assets in operation and under construction
Additional countries with projects in advanced development
15 countries 4.1 GW 110 power plants(1) 255 employees 12 GW total portfolio(2)
in operation or under construction
>80% OCDE
(1) In operation or under construction
(2) Assets in operation, under construction and projects awarded, tender-ready and in advanced development 62We have long-term, predictable and de-risked cash flows
Long-term visibility Strong currencies Contracted revenues
c. 13.4 years USD €6.2bn
average remaining PPA duration(1) 17% Contracted revenues(5)
3.1 years vs
AUD EUR
average asset age(2) 43% 40%
€2.3bn
Net debt(6)
c. 50
Years 25%
land control(3) land owned(4) • More than 80% of Neoen’s clients have
FY 2020 revenues investment grade ratings(7)
(1) Weighted average residual PPA duration by MW in operation as of December 31, 2020 | (2) Weighted average age of
assets in operation as of December 31, 2020 | (3) Weighted average lease duration (by MW) for assets in operation and
projects under construction; residual duration of 45 years (4) Capacity installed on owned land (for projects in operation and
under construction as a % of total MW) | (5) Revenue contracted for the coming years, as of December 31, 2020 | (6) as of
December 31, 2020 | (7) Weighted average investment grade off-takers for projects in operation, under construction and
awarded 63Neoen ideally positioned in the sector
1 2 3
High-quality and young Sizeable and growing pipeline A highly efficient
fleet of secured assets to fuel future business organization
4 5 6 7
A clear disciplined Distinctive Extensive in-house Best-in class
investment approach multi-technology expertise know-how coupled with ESG profile
supported by pioneering seasoned management and
storage integration committed shareholders
64Renewable energy market outlook
Key market drivers of renewables expansion
Sustained commitment from governments
and off-takers to containing global warming
Increasing competitiveness
of renewable electricity generation
Growing global energy consumption
Growing electricity demand related to
transport electrification and hydrogen
development
Large stimulus plan in OECD countries with
global decarbonisation policies and need
for energy sovereignty
66Buoyant long-term growth prospects for renewables
Evolution of global installed capacity
2019 2025E 2040E
1.2 TW 2.3 TW 5.6 TW
16% 26% 42%
20%
19% 15% 27%
8%
20% 8%
5% 11% 4%
6%
7.5 TW 8.8 TW 13.4 TW
14%
58%
50% 35%
Solar Wind Fossil Fuels Nuclear Other
Solar and Wind CAGR 2019-2025E: + 11.0% Solar and Wind CAGR 2019-2040E: + 7.5%
Source: World Energy Outlook 2020, IEA 67Strong market dynamics in our regions
Australia Europe Central and South America
(installed capacity in GW) (installed capacity in GW) (installed capacity in GW)
457
422
33 95
356 370
75
299
281
20 60
54
17 204
40 42
147
11 11
23
7 7
4 11
2019 2025 2030 2040 2019 2025 2030 2040 2019 2025 2030 2040
Solar Wind Solar Wind Solar Wind
CAGR 2019-2040E: + 7.7% CAGR 2019-2040E: + 5.2% CAGR 2019-2040E: + 10.8%
CAGR 2019-2040E: + 7.9% CAGR 2019-2040E: + 3.9% CAGR 2019-2040E: + 5.8%
(2)
Source: World Energy Outlook 2020, IEA & Baringa 682025 targets and strategy
We will double the pace of new projects awarded
NEW AMBITION
ACHIEVED > 2 GW
ANNOUNCED
IN 2019 AND 2020
per year
AT THE IPO
by 2025 and
1 GW ONWARDS
0.7 GW per year
per year
x2 vs. 2020
x3 vs. target announced at the IPO
70Our existing platform will act as a springboard
At least 80% of new projects awarded
in existing countries…. …drawing on
1 Develop more, larger-scale projects Large and robust advanced pipeline
Market leadership in selected countries
2 Broaden technology mix in each country
Differentiation through storage and energy
management
3 Seek governmental contracts + corporate
PPAs + merchant
Experimented local teams and strong
reputation
71New geographies will bring additional growth
Up to 20% of new projects awarded to come from new countries
Selective approach Same proven criteria
• Expand in our three regions • Concentrate on markets at or below grid parity
• Apply framework of at least 80% of installed capacity • Seek countries offering potential for Neoen to develop a
in OECD countries top tier position
• Focus particularly on some new European countries • Give priority to long-term off-take contracts with solid
counterparties
• Sign PPAs denominated in reliable currencies
• Finance mainly with non-recourse debt with local or
international lenders on same currency as project PPA
revenues
72We have proven our ability to replenish our pipeline
12 GW
+4.3 5.4 6.9 GW
7.7 GW GW of advanced pipeline
at end-2020
3.3 1.5
1.1
1.2
1.4
0.9 5.2 GW secured
0.8 at end-2020
2.6
1.5
31.12.2018 31.12.2020
In operation Under construction Awarded Tender ready Advanced development
73We have a diversified pipeline
Advanced pipeline (tender-ready and advanced development)
Storage
AMERICAS EUROPE 6%
Wind
1,308 MWp 150 MW 51 MW 1,817 MWp 655 MW 67 MW 34% 6.9 GW Solar
61%
AUSTRALIA
Americas
1,060 MWp 1,506 MW 260 MW 22%
Australia
41%
6.9 GW
Countries with projects Europe
in advanced development 37%
74“Develop-to-own” is Neoen’s core business model
• Provide a strong competitive edge in tenders
• Guarantee the quality and performance of our
assets over the long term
• Deliver value throughout the project life
cycle
• Control risk-return
• Secure land beyond industrial lifetime with a
view to repowering
75We are in a position to seize potential external growth
As in the past, Neoen will seek potential
opportunistic and value-creating acquisitions,
targeting for example:
Distressed Old assets with
industrial assets repowering potential
and platforms
76Discretionary farm-down will also bring short-term value
WHY?
• Very high growth in new projects awarded enables
us to implement a farm-down policy
• Farm-down is an opportunity to realize short-term
value creation alongside long-term value creation
coming from develop-to-own
• Farm-down will allow us to contribute to the
financing of our growth
For each GW of newly awarded capacity, Neoen could sell up to 200 MW of projects or assets
77We will more than double in size by 2025
Consolidated capacity in operation or under construction post farm-down
> 10 GW
by the end of 2025
~2.5x
4.1 GW
2020 2025
78Investment envelope and criteria
We will keep strict investment criteria
Methodology Bid equity IRR criteria(2) depending on geographies
• IRRs and depreciation for solar and wind projects(1)
calculated over 30 years vs 25 years previously in order Other
to be aligned with the OECD Europe Australia OECD
countries 7.5% 8.5% 6 to 10%
– Industrial lifetime of assets (+/- 150 bp) (+/- 150 bp)
– Widely recognized market practice
• Indexation and Opex in line with contractual framework Non-OECD > 10%
and lenders’ assumptions countries > 10 %
• Merchant price assumptions based on a range
of independent experts’ forecasts Tailored IRR approach on each project taking into account
• Production estimates at P50 using independent experts’ • Country risk profile
assessments • Off-taker profile
• No commercial terminal value • Merchant exposure
(1) Bid IRRs and depreciation for Storage remaining at 15/20 years depending on technology
(2) Not assuming any IRR uplift from potential subsequent farm-downs 80We have proven our ability to achieve growth and value creation
Loirecopark, France, February 2021 Goyder, Australia, September 2020
39 MWp Q4 2022 100 MW Q2 2022
PPA capacity Expected COD PPA capacity Start of construction
• We have fully developed the project in a country where permits • We optimized a gigawatt-scale project drawing on world class wind
are scarce resources
• We bid with a large project by French standards, taking • We went beyond the base requirements of the tender process by
advantage of economies of scale in project financing including a battery storage facility to meet the needs of the Australian
• We are rehabilitating former military land Capital Territory (ACT)
• We benefit from a strong track record in terms of delivery that had a
high value for the off-taker
81We have a disciplined procurement strategy
• Selection of the EPC on a project-by-project
basis
• Focus on top-tier EPC contractors with strong
guarantees and top-tier components
• General policy: full-turnkey contract with
protective terms
• Strong HSE requirements
Selected EPC contractors
82Competitiveness of solar and wind will continue to improve
Capex by technology(1) (in k€ / MW) It’s not just about capex….
~ 1 000 ~ 965
• Cost of wind energy will continue to decrease driven
by further technological improvements :
~ 500 – Larger-capacity turbines
~ 425 – Increased hub heights and larger rotor diameters
– Optimized power electronics (power inverters reliability
and dimensions)
2021e 2025e 2021e 2025e • These advancements in technology would
– Improve yields for the same location
– Reduce installation as well as O&M costs per unit of
installed capacity
Solar Wind
(1) Average capex for new awarded projects including interconnection costs but excluding development fees 83Approach to leverage
Our leverage approach
Neoen SA
• 170 M€ first European green convertible bond – Maturity: 2025
Corporate financing • 200 M€ syndicated loan linked to ESG criteria – Maturity: 2024
• 200 M€ convertible bond – Maturity: 2024
Non-recourse debt at project level(1) Project finance debt gearing at 31.12.20202 Cost of project finance debt at 31.12.2020
80% 78% 6.5%
71%
Project Project Project Project 3.9%
1 2 3 x 1.8%
EUR AUD USD EUR AUD USD
78% on average 3.4% on average
Leverage (all debt(3) / invested capital): not less than 70% by 2025
Net debt / EBITDA ratio: between ~8x and ~10x in 2025
(1) Mezzanine could be complementary to project finance at project level | (2) Weighted average ratio of project
debt to investment expenditure for the project's development and construction, for all the Group's projects in
operation as of December 31, 2020 | (3) Whether corporate or associated with project financing 85Structuring project finance at competitive terms
Strong relationships with financial institutions Optimized financing structure
• Non-recourse repayment schedule –
sized on cash flows over time
OECD markets Non-OECD markets • PPA lifetime (with or without a tail) or
negative tail (i.e. merchant
exposure)
Debt
• Debt Coverage Service Ratio sizing
Potential
50% - 90% criteria
Equity increase of • Same currency as the PPA or
leverage indexed on same currency
10% - 50% ratio through • Variable interest rates largely
refinancing swapped into fixed rates
• Competitive terms and accelerated processes thanks to Long-term project finance debt(1)
– Strong long-term alignment with lenders
18.0
– Existing strong relationships 15.1 15.4
– Larger projects and portfolio effect
– Neoen’s reputation, credibility and expertise
• Optimized due diligence and documentation process
thanks to recurring business and repeat deals
EUR AUD USD
16.3 years on average
(1) Average remaining maturity of the financing for all the Group's projects in operation as of December 31, 2020 86Source of funds
Investments and source of funds
c.€5.3bn
• Project financing and refinancing
• Refinancing of corporate debt
• Cash flow from operations
• Farm-downs
Up to €1.2bn
Total investments 2021-2025 Source of funds New equity
Highly flexible, as assumes
100% ownership of the next 5 GW
88Short-term and medium-term outlook
2021 guidance and medium-term outlook
2021 2022 2023-2024-2025
More than 5 GW of capacity More than 10 GW of capacity
5 GW of capacity (1) fully
in operation or under in operation or under
Capacity operational by the end of
construction(1) by the end of construction(1)
2022
2021 by the end of 2025
Between 295 M€ and 325 M€(2) At least 20% annual growth
EBITDA Double-digit annual growth
EBITDA margin around 80% vs. 2021
Dividend policy First dividend to be paid Progressive
dividend policy
(1) Consolidated capacity post Farm-Downs | (2) Including capital gains from Farm Down (will not exceed 20%
of 2021 EBITDA) but excluding the impact of IFRS 2 according to new EBITDA definition. It takes into account
the best estimate to date of the timetable for the commissioning of power plants currently under construction 9091
Thank you for attention ARGENTINA AUSTRALIA CROATIA ECUADOR EL SALVADOR FINLAND FRANCE IRELAND JAMAICA MEXICO MOZAMBIQUE PORTUGAL SWEDEN USA ZAMBIA
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