Q3 2019 Earnings Call
Just interject.
Renewable energies 2019 third quarter results conference call it.
We have any other calls they have telephony.
Let's see pcls, because each I didnt quite yet CMS related accessories to me do stuff, you know checks and you'll see kind of Alaska.
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I'll now turn the cost over to caffeine Shaw communications.
Communications Director. Please go ahead.
Thank you Hello, everyone and thank you for drinking out because it.
I'd like to find that this conference will deals in English members of the new yard braided twists and person I.
After this call.
The presentation supporting today's discussion.
On dealer base over with like that's reasonable do those individuals.
The scope of the company forward looking statements.
That's a couple things because it could go.
Although the corporation, but we feel good vision Muslim show.
Such forward looking statements.
Are you going a little under the.
Okay.
Listeners are cautioned that through <unk> on the forward looking statement.
Nordstrom's can be given that needs to be got it.
Forward looking information company area is my thought because it doesn't solve the corporation does not undertake no obligation to.
A big or device forward looking information, whether they be dealt with them.
Occurring after that but you're right on this record sorry.
During this call.
Financial measures that are not because they are good reasons and I suppose eventually 47.
First the delivery of her husband's assumption of.
More information.
Okay.
Before we would put them through the goals and Mr. Mitchell must be.
Because it wasn't there wouldn't be viewer consider personal money like into fourq or.
And I'll turn over to come from.
Good to Barry.
We want.
And Paul reported strong results again this quarter.
Sure.
Can I just couldn't be.
30 540.
28% respectively.
Before doing so that I'd like to stress that all 2018 among mentioned, we're restated to be comparable with what do you mind.
Given that we are reporting when they're going to be operation, They do which.
Interesting golf resort.
In the third quarter award for the city living for Jack reach commercial operation.
<unk> would be succeed dependency, we reaffirmed our assumption with a more conservative view to take into consideration.
Listen congestion in the region.
The truth quadrant.
He sold energy from ore feed needs for Roger So when you commissioning is expected.
Oh, what proportion of adult which.
Sure joint venture and not too yes.
Also increased significantly.
Production the portion that 30% in the quarter.
2149 gigawatt hours.
Revenue the portion as well.
Oh no one a good are needed in dollars.
For Sandy Creed.
I, just said the proportion that 24% $136 million.
For the nine month Korea.
What are some proportionate.
The portion of not just could you be proportionate increase.
20, 820% to 22% respectively.
On slide eight.
For the quarter.
Well that's shown in green mainly.
The increase of toward the nine gigawatt hours in the wind segment called by what are sort of demand in Israel.
The five car T wind farm.
But our children.
And the commissioning of the Forest City wind project.
The soldiers segment also recorded an increase mainly attributable to do that but failed.
<unk>.
Continuing lifetime.
Well maybe revenues.
$143 million.
You may need to the quality acquisition and I don't know that.
From the wind facilities and then.
I would be energy so like the PV.
Roger.
No if we looked at B. I, just said BBB.
We can see an increase of 28% where last year. What are your done $7 million, mainly due to the same needs on a full revenue.
When I do not sure or joint ventures, and that seems to be up on slide 11, our adjusted EBIT proportionate reach $130 million.
Media increase with the same quality or not.
Higher contribution from the be facility.
Yeah, this year and their job like well more than offset the lower revenue.
Our wind facility.
Our next stage.
Changes in the financial position I.
Then maybe from the sale of eight years ago.
Additionally, construction activities out before then.
As shown on the much like a work because no which.
It you talked about since we are reporting on a trailing 12 month basis.
Increased by 2 million to $145 million.
I will be obvious you changed significantly up 93% compared to 87% year.
On slide 14.
Yeah, no during the quarter the redemption of our Fourpoint, 25% convertible debentures that was completed on what they do.
2019.
We also completed they've been true operating a $125 million, which was either no rural allotment option.
Good 0.7 $5 million.
The be offering were used to redeem the book was 25% debenture.
Remaining portion was.
Thank you.
No I wouldn't give the board to shuffle Gilbert from older you good basketball shoe show.
Thank you help us well good afternoon, everybody. We're sorry, the sound is not a bad good we are in Texas.
It's a visited our TV project with the board of director.
I'm very very proud to exceed its a this achievement. The construction team has a coke is during the Vicki who treat to finalize the construction, although we have not been here.
Just in mind a.
Little bit more of a technical match with the financial goals of this activity, but be a project has been generating a export capacity.
Getting all that September so pretty proud of Oh, I'll be construction Dean and all the other.
People involved and.
There's big project for the time gains that doesn't remainder TV is the biggest a solar plant in Texas, So pretty impressive.
So he's a panel all over the the landslide. So construction also with very active in for two years, you've seen we have completed the you do you foresee a glad to report also that I, usually you know after a few a few weeks or it takes a few.
A few months do make sure that all digital bugs are being near during the 60 period then after after that but a indicates a on the team. We're reporting that are actually very little downtime or a where every quarter and <unk> performed very well in.
Terms of a putting these machine or up to full production and actually the month of <unk> Oh.
<unk> has produced a 120% a over budget a versus b a long term average so corn the kind of interesting to see that a this is a project is producing a at full capacity since the.
Yeah Yeah.
Much of a buck so quite keys with that as well.
In terms of a construction also you have any future.
The the placement and a supply.
First material no big.
We have an interesting are set up over there where we have you want the contractor, but he the boat big towboat to bring a material from the lower being <unk> James they ought to be a top of the ought to convey so this way we have now.
Hey system, where we can bring the material on rule.
The lower Ah and have been seems to be and bring a by a bike.
Our materials. So this is a very clever ways to make sure that he will be supplying to construction side. So during the.
Summer period at the peak of the construct was a pretty happy to the infuse. The you should do from our contractor to make sure that we'll be able to have a country in which supply to construct a this project in the north.
Also in development last construction, we have initiated a lot of discussion.
Correct.
We have signed a limited notice to proceed with the contractor to start construction, that's really a generally all the other aspect of the finalizing the construction permit or not and mm underway.
And also the BPMI confusion.
Okay very good then a we are very hopeful to be able to announce it just before year end, so actually hillcrest should be fully a fully in construction.
Really.
Q1 in 2020 quite proud of that that's a 200 megawatt solar project here and Oh higher.
Now if we switched to the good luck in the six a section a the team were also pretty a pretty busy as you remember we have the strategy of deploying a small solar panels that we have bought a in order to.
Creep a free pre qualified confusion about a four pool or like the <unk>. That's for the next few years. So the idea you just do you do you have a.
A reminder, that yeah I did you do boy anywhere between 500, 700 megawatts or you solar project.
We have now a full control on a one took them, Texas a site a we have a couple more yeah quite out then the negotiation with the man control in Texas and we also want you have five to six project can be Pennsylvania, Ohio area.
Diversified our development and markets exposure not United States. So on that front, a quite happy to see those those projects being developed we'll talk about it in the next a few quarters do you want to keep you up the Darren that advancement.
Still into sort of the U.S., so but little bit further we have also.
And our along in a project and there, but we also have been busy in answering the art you know why.
Let you report that we have submitted for poultry on three island.
Oh, usually I don't I described mortgage.
The first a wave of Oh, the RSP preferred a preferred the proponent will be selected before the yearend and be will have a second a chance.
We opened the the bid for the first quarter of 2020, So we will not comment more on these projects since they are still in competition with many others in Hawaii.
Frank has been busy as well you might have a read about <unk>.
Oh, it's an interesting a venture that you have done with great experience, though people in the a Indian history in France.
It's not a big transaction it sounds that you're hoping to have a perhaps oh five or six projects totaling anywhere between 100 950 megawatts to be viewed locked in the next five years.
The early it's a possible project should be between two to three years, not being either <unk> or full permitting and is available to put into our <unk> or two take the and be a contract for good friends and Oh.
Well in our own the portfolios advancing well the strategies do you have to be Threed athletes be project for your starting in 2020, 120 or 22 to be in a in construction. So the team in France is advancing quite well known but oh that matter.
Now if we if we look a in Canada, there's a tough catch warn that had been exits or RFP, so well get a ready we have a few project where weekend a weekend would the RFP. So he will be a horse a competitive but Ah we have a few a few probably a few project.
That seems to be competitive and also a will or will be participating in Ah that's catch one though in the next year.
Now if we go back to Chile.
Working hard on Frontera.
We hard now negotiating with a contractor and the turbine supply or trying to make sure that you can get the most interesting offer from from these people are advancing also on the Oh the financing of Frontera.
But of course, a what's happening.
Putting everybody movements on a on the whole just make sure that being a will evolve in the right way. So a we are working with everybody but were caution in a in a looking or.
The.
The.
Right. So hard time seeing in English, but works is concerned that it but positively.
What's the positive on the fact that.
Policy over there should shooting and.
President of TV has just announced that he has now offered to change the confusion so everybody looted on a on the even friends. We could say someone to look tells you what would be oh.
Okay.
So still positive about the other TV, but just want to make sure that things are going to cool down into right direction before committing a more to their construction on from zero, we have a good when do opportunities as opposed to construction I'd be early fall next years.
So that would be a the a general aspect of the Oh, Yes did laufman.
Always on to look out for good acquisition that could be accretive to our casual and would have strengthened our position in our different market on this we'll open the floor for questioning.
Thank you ladies and gentlemen, if you have a question. Please press star followed by the one on your Touchtone phone.
[noise]. Please ensure you lufthansa if you're using speaker phone calls for pressuring any keep your first question comes from Sankaran from National Bank Financial Your line is open.
Hi, there I'm, calling on behalf of Rupert.
No project currently in the pushes over redesign can we get some color on what do you expect to the pros are forward looking basis.
No I'm sorry, your line is a little bit difficult I could be good louder, we really haven't heard the question will.
No more short my question is on Oh No project.
Which I believe is currently in the pushes over redesign can we get some corridor.
Yes, but you're going forward.
This one is a is it 10 and what a hydro facility.
I'm not sure not true that you're going.
We're concentrating our if work on front, there referred to foundries and their little you would have still a lot of time to review would a in terms of permitting a but I would say that are for the time being you would be focusing on from there.
All right and.
And I <unk> <unk> are you guys still considering or some known LCB upon completion of construction and any other comments on potential others Philadelphia.
We are always trying to I would say.
Enhanced any financial engineering.
So these are looking into.
These possibilities you then the the maturity of TV, but it's not a it's not a first priority for the time being.
But you always considering a recycling some are some capital and making sure that we create value by doing so.
I think that's all for meals are back in Q.
Sure.
Your next question comes from Nelson Ng from RBC capital markets. Your line is open.
Great. Thanks, I hope, it's Sunny where you are.
Yes, it was colder and Wendy [laughter] Rah rah location for the window right. My first question relates to your or developments in France, you mentioned.
You are kind of five year targets on plans I.
Just wondering whether they go after a year agreement with Ah I guess, it's called Eastwind.
Like what are your expectations in terms of a bidding into the a the French I guess wind or solar RF piece has that.
Just a lot of flat or pushed any projects a florida in terms of fear.
Oh, what do you expect to bid into the next therapies.
No.
This will help that I would say strengthened the amount of broader cooking warehouse, but b you don't have.
Project ready to deal right now so.
That's why I said, the probably the earliest one from did not and that's a should be between two and after three years before we can bid them, but from our apart.
I think that by the end of 2020, you should that we weren't project, we could fit into the are you.
After that we're hoping to have between <unk> and three project every year <unk> to be or when they're good then.
So it took a bit of turned to start the or did very well indeed.
He's really feed the the total portfolio as you know friends. They don't five years developing projects. So we've been added for the last three and a half year. So it enhanced we're getting now a very close to start harvesting.
The amount of early early investment that we've done no point in the market. Although there's there's a little warn that is actually ready to do built it's an extension of our existing E. on project.
We are extending a disposing by adding three machines. So it's not a big project, but it's the first that had a gun to be a permitting process. So we should be able to start construction somewhere next year and that small one that's about six and a half do seven megawatt but.
The efforts. So it's that you have to for some words on the how deep you.
But the a the pipeline in trends is starting to produce a project ready to go.
Just to clarify on that last project. The small expansion would you have to bid that into an RFP in order to I get a contract before you start construction.
This one is the small one would be a is a less than six a turbine. So we can we couldn't get the the PBT for the difference. So it's a you don't have to bid in the in the art piece and as soon as we have all the permits in hand that we have to send that the project and.
Yes would have now the price I can't remember the exact right, but it's something close to 70, a city or something for each of you know what the power.
Or not.
Okay I.
I don't know exactly like the hurdle.
The group within those about.
Seven cents.
Seven euro cents right.
Yeah. So.
Since.
It's a it's been in.
Euros per megawatt hour for seven so sooner or by kilowatt hour.
Okay got it and then just start moving on to afford city I'll just looking at a revised forecast in terms of revenues on an.
An EBITDA I think the.
Though latest revenue forecasts.
Assumes roughly I realized prices about $15 per megawatt hour.
Down from about I think like 16.7, and then the.
I think the implied operating costs increased by about 3 million. So could you just give a bit more color in terms of.
The the reduced realized price I presume, that's mainly just due to congestion, but then also the increase and the implied opex cost by roughly 3 million.
Yeah, that's something that's when we'll call bookmark it Mike My answer, but the revenue yes. The written who is a in line with little bit more conservative view on the future congestion. This is of course.
Something that will either.
<unk> in time, we're hopeful we'll pull that the are caught a system will be agreed at all to the transmission system would be upgraded but of course the expenses very popular for a for a as the state to implement wind and solar so sometimes you get you have a little bit of the overbuilt in certain there.
Area before do you get a to be upgraded.
So yes, we're going to review for the expenses, there's a few little heightens that had been moving around but the main a the namely the bulk of read taxes that wins when he few defers the guidance.
He was based on a cash pieces and we had a holiday.
You are well I guess was on a diesel.
First 12 months Halloween.
Right right now we provide guidance on the not good bye.
Right.
The main elements.
Yeah.
Corporate.
Yeah, which is close to the $3 million and then they didnt happen in Abu <unk> diversified.
Then additional assumption.
I'm not sure.
So we should have.
I guess forecasted that a a de initiated a guidance.
That's why it seems to be a bigger difference, but it's a it's a onetime adjustment.
Property.
Okay, Thanks, I'll get back into queue.
Right.
Your next question comes from Sean Stewart from TD Securities. Your line is open.
Thanks, Good afternoon I'm just following up on Nelson's question. You you also had smaller negative revisions to a.
Contribution from CB similar factors at play there any contact she can provide.
There are this easy the revenue were mainly.
A reflection of the more conservative view on congestion.
Okay.
And Shannon of flat top contributions were were weak this quarter.
Any details you can provide there.
And presuming some of that as nonrecurring.
No.
Not as the generation was good but it all related.
What I will generate.
Yeah.
Hi people outside.
The mean.
I think.
No I'm involved.
Yeah. The if you remember the the market was very either walcott in terms of pricing just a this summer and sometimes.
The price was high and to win was low in hand, we had a two by energy on the spot.
And they were quite expensive, but we're working now with a with the firm to try to be a little bit more proactive into the I had oh screening so to minimize these big swing and who you are also.
And distributing some kind of a hedge.
Basically by some exposure to the market Oh.
The markets to basically.
What are some kind of the hedge or an insurance on builds wild swing to minimize any huge exposure so to answer your question it.
We're hoping to see that as a one off given the fact that will be trying to mitigate a by a derivative and being crew a proactive on the had trading to basically minimize these exposure.
Okay. Thanks, very much I'll get back into queue.
Good.
Your next question comes from markets RV from T.I.B.C. capital markets. Your line is open.
Hi, good morning.
I wanted to go back to Ford City.
Congestion issues.
What would the expectation of how long it'll take before some that clears.
If you have you seen as hits in the projects in Texas think about.
Taking some of your capital out of that project returns.
<unk>.
Well be.
MPT. He wash has brought a lot of win and ER in Texas, who by the time it takes to.
Rebalanced, the a the trends for piece and it a system.
Can't take two three years 40 years supply Daqo sports, so it's difficult to predict right because.
It's a matter of basically a input and also a capital.
Expenditure to could be put in place so difficult to be quite true. So that's why we when we say we've been little bit conservative we.
We'd be Taxact, Moody's will losing we thought we take a few a forecast from different expert in a in the field and of course, we have to make some judgment call as well. So we hope we've been conservatives in a in bad Guy then.
Have your second point in saying to you want a diversified from Texas at some point in time, yes, and that there were first question about recycling some of our capital in CV and grab some 40. So we are.
Of course, taking that into consideration, especially if we also are successful you ended lumping more prolific in Texas in the field to the I'd would be to kind of recycled these ah that capital and hopefully create value when we do our own that greenfield projects.
Okay.
And then maybe this is.
Maybe could explain.
In the free cash flow.
Reconciliation, there's just a income tax paid on intercompany loans, because maybe walk us through how that flow through in cash.
Yeah. This neeson TV.
Yeah, It's a cool game, we announced in Q2 and now we needed to you.
Pre deposits on the target would be vision.
To be paid on first quarter of 2020.
But this is the and then announcing our pay allocations. So it's not bad because in our tax line.
They did.
Sure intact and then he added back since its in relation to be yes.
<unk> equity contribution.
The projects and we don't consider besides being.
Gosh I couldn't tax on operation. So that's why did that.
And then.
So you talked a little bit about the civil unrest in Chile, just curious how much impact.
Business and then maybe just.
She thought maybe what kinda impacts on Frontera is it just people are preoccupied income.
The bank financing contracting or sort of how does that.
Playing into how you want to advance Frontera on the next couple of quarters.
Well at a for the time dealing we are not slowing down in front there but of course, it's a either for some reason that a.
Recent worsen financing can be can be nishu. So we don't want to treat a our itself a little bit a in the litigation spend too much liquidity and then you'll be stuck with.
Switching were bank when windfall was but like I said I'm still positive I wouldn't there on the by just happened to that was visiting our facility and analysis.
Well I landed on the on Saturday morning of or the beginning of the crisis. So I would there and witness a little bit of what's happening, but I was I was not also could be able to exchange with a lot of ER business.
Business individual and some fall in the politics also a people and I think that in general.
Yeah she need.
Police and of course.
I wouldn't say they are very motivated to.
[noise] create I'm, sorry did it the word disturbing to create a he knew social shown social contract with the government.
But what I what I saw also is that the elite the over there.
Are not against it I mean there.
Concern and of course anybody get to that had said yesterday that bigger or a tax payment is not that happened, but I think that a in general a the business the business theater understand that spine to renegotiate the social.
Then if it would a with a couple of isn't dinner and so that's why I'm quite hopeful that a situation a little ER.
We'll end up being a solved in the next to humans.
And to some degree or to the second part the contractor we were negotiating with local contractor.
And to some degree that provided us a.
A little bit more flexibility to negotiate with them because the sum of do you.
Activities or construction activities are a slowing down to some some shortly on the price of a copper is not going to do so there's less activity the mining sector. So it's perhaps a good window for us to negotiate a very good construction a contract and reduced a little bit the total tool called.
Okay.
Okay and then my last question would be Wonder Hillcrest, just curious again.
Curious if you.
You guys would be in a position with construction activity starting up and.
She just still capture the fall off 30%.
So that project, yes, yes, yes, definitely because we already have also bought the a that's the first solar a codec and yes, that's correct.
For the 100% the ITC Uh huh.
Okay, great. Thanks.
[noise] once again, if he would like to ask a question. Please press star followed by the number one on your telephone keypad.
[noise], but especially when there are no further questions at this time.
All right. So thank you very much everybody and.
Ah we'll see you are in a few months. Thank you.
Thank you.
Ladies and gentlemen, you may now disconnect your lines.