Q2 2020 Boralex Inc Earnings Call
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Good morning, My name is Simon and I will be your conference operator today.
At this time I would like to welcome everyone to the board looks Inc. second quarter 2020 results conference call.
All lines have been placed on mute to prevent any background noise.
After the speaker's remarks, there will be a question answer session.
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They're not cyclical.
Thank you operator, and good morning, everyone.
You're welcome you to a bottleneck second quarter results conference call. Joining me today on the line are perfect <unk>, our president and Chief Executive Officer.
That got our vice President and Chief operating Officer, we didn't know get about our vice President and Chief Financial Officer, and other members of our management and finance teams.
Yes, I am I will begin with comments about the highlights of the second quarter afterwards, Minnesota costs would provide comments on the operations and on the development and Mr. Guy, that's getting that sorry, [laughter] well that carry on with financial highlights and then would be a all available to answer your question. So as you know during this call.
We will discuss the sort of call. That's my last forward looking information so when talking about the future there are various de risks.
And that up in listed in our different filings with security regulators, which can materially change. Our estimates risk estimated results are these documents are all available for consultation seed our dotcom.
In our a webcast presentation document the disclose results are presented both on the IRS and on a combined basis unless otherwise stated all comments made in this presentation waterworks grew two combined basis figures. So the press release, the M.D. I need a consolidated financial statements and a copy yesterdays.
Isn't Asian are all posted on the buybacks website <unk> dot com on 30 investors section if you wish to receive a copy of these documents. Please contact me.
Whenever you want so I still am I will now start with its common. So please go ahead okay.
Thank you Mr fan good morning, everyone.
I will start my thinking once again, all our employees for their hard work. They continued to provide despite all the elements relating to a good bit 90, which is still affecting our daily lives in different ways, depending on the region, where we are living it.
Once again this quarter, you really made the difference and allowed us to continue growing our EBIT d. and adding projects to our pipeline.
Comments were made during the call the quarter by many governments, indicating renewable energy shouldn't be a strong component of their economy recovery plan.
[laughter]. This major sanitary an economy crisis would probably I would probably be the triggered needed to accelerate the energy transition underway.
For us where I've been in this business for 30 years, it's the logical that to take investing into different economic economies of the world to resumed growth, while taking care of the health of the platinum and all the people living on it.
In New York State Governor Cool.
Reaffirm his objectives to achieved zero emission by 2040.
And this desire to accelerate exchanges with Canada, a white paper, indicating they need to accelerate the growth in the development not renewable energy to achieve the stated goals.
I was also published by Nicer, though and New York State Department of public service.
In Qubec Prime Minister nickel indicated that the new projects to be done in the province would be when projects, which is good news Fort worth 200 megawatts I forget project in France.
Wes will proposal are continuing and government officials reaffirmed their commitment to de energy transition.
All these announcements are really positive and reinforce our conviction that we have chosen to write market in our strategic plan.
Turning now to our second quarter result.
We experienced mix when condition in the quarter, which resulted in strong production production in Canada, which conduct only compensates for the decrease in wind production in France, and hydro production in North America.
However.
We have been able to increase our EBIT D. Thanks to our Canadian when operation the optimization of our service and maintenance costs and the contribution from our Buckingham hydropower station.
We have been able to add projects into our pipeline and advanced projects within our growth path.
During the quarter. We also completed many optimization initiatives, which will bear fruit inquiry.
I will now report report on progress towards the foreign station or worse strategic plan, starting with the main elements of our great orientation.
Last Saturday, we commissioned our 515 megawatt wind farm in France. We also added hundred in three megawatts of projects to our pipeline.
And then three project from secured stage to the you're ready to build stage in July.
We bid out were 90 megawatt projects in France for Oh for which we have been able to optimize layout and increased capacity from 51 megawatt 71 megawatt.
On the diversification orientation, we are getting ready to bid projects, India Dober auction in New York State.
On the customer orientation.
We signed our second culprit, b b with retailers or shot in France, which will be fulfilled by two wind farms, having E.D.F. contract and.
In terms of optimization. Many initiative were put forward, notably the optimization of maintenance work on wind farms with total production capacity of 412 megawatt or 276 megawatt NEP to behind it.
Last Friday to when the optimization orientation is the construction on the weight of the Shilohs wind farm in France, which is going as planned.
We also had three repowering projects to be optimizing our growth path.
In conclusion for my part as mentioned at the beginning could've been 19 did not significantly affected us thanks to the dedication indication of our employees [noise].
Sorry.
Our development activities continue and we are looking at ways to accelerate the process at different stages. We also maintaining a disciplined execution of our of our class.
We are strong financial position to capture a potential accretive opportunities, bringing strong cash flow.
Maintenance energy or a strong pipeline to develop development projects and finally, we can count on the mobilized management team and the innovation as well as the sharing of best practices.
Between the different part of our organization.
I believe that occurred in 19 pandemic, why forcing people to work remotely and alone in their houses or apartments.
I have strengthened the relationships and the team work among the different services in our company.
I will not let Patrick cover our development and operation I will be back later for the question for you I pick.
Thank you Patrick good morning, everyone.
I would go directly into the analysis of our production.
Hold on slide eight nowhere presentation documents or Canadian wind operations performed quite well the second quarter was production, 10% higher than anticipated production and full person higher.
Then I've just seen.
Quarter last year.
These gross was strong and enough components to compensate did decrease.
In production in France after true exceptionally good coulters in France, the second quarter and ended up.
One person lower than anticipated production on a comparable basis.
Due to less favorable wind conditions.
Production from the commissioning a wind farms was lower than expected due to the slight delay.
The commissioning of our salt they wind farm.
Overall total when production for the quarter, combining Canada and French was in line with the anticipated production and two person higher than last year.
Turning to hydro now.
Production of the Buckingham power station was 14% higher than you anticipated production following its reopening.
Comparable hydro production in Canada, and U.S. was down compared to anticipated production and also compared to last year huge two week hydrology conditions in general.
Thermal production was down compared to anticipated production and last year due to temporary shut down of the sentence station during the seasonally no period of two years.
Yes reduction should be offset in the second part of the year.
In summary.
Total production for the quarter West five person lower and then TCB production and Foreperson lower.
And last year.
You can know d., so whoever on slide nine forward presentation.
On the year to year to date basis total production is four person how your than the anticipated prediction and full person higher than last year. Thanks to the very strong first quarter.
Turning to development.
As you can see on slide 10, we added and within three megawatt to our portfolio project in the second quarter.
Projects, where I did in the early stage for Bush, North America, and Europe, and some projects progress from mid stage to advance stage in Europe.
45% of project I did where wind project and 55 solar project.
No project advance from the portfolio project to overgrowth spot, which we are considering some of them good progress in the coming quarters.
As mentioned by Patrick We had we have bid 71 megawatt into July tender in France, and we are preparing our bid for the upcoming request for proposal scheduled in October well do New York State solar market.
Turning to overgrowth pass no I've mentioned, we added 15 megawatt to or production capacity with the commissioning of our salt <unk> wind farm in France.
Well, we're blush foolish 11 megawatt wind project in trends moving to the ready to build stage with commissioning expected at the end of the year.
Two reporting project he visuals alpha and immediately Klabin also moved into the ready to build that stage, which commissioning expected in the first how off 2022.
Please note that these two project will while adding only two megawatts of capacity per project will improve production by more than 60% for the total 14 megawatts of production capacity each after repowering because.
Of the longer size of the blades and overall improvement inefficiency.
These two wind farms also secured 20 years contract with media.
Please note that we have changed the name of these two project to harmonize internal and external reporting.
These two projects were named Nuveen, he boring one one and two in the first quarter gross.
We're making good progress we've secured project and our and are expecting to have some of them moving into the ready to bid stage in the coming quarters.
In conclusion whole my part we have a good production level for the first six months of the your our project are progressing well you know were pipeline.
And grows faster and I'm very proud of all the optimization going on at all levels in the organization.
We have a strong momentum right now, which is very encouraging for coulters to come.
Finally, we are getting ready for the upcoming request for proposals and are quite optimistic about what we have in the pipelines to bid in day senders.
This completes my part I wouldn't know that Reno covered the financial portion in more detail.
And we'll be back later for the question period.
Reno.
Thank you Patrick.
Good morning, everyone.
Let's start with a review of the progress made in light of arc 2023 financial objectives.
Starting with our last 12 months, if that's all which decreased by 20 million from one to 44 mail again in the first quarter, two 124 million in second quarter.
This decrease is due to timing effect in the debt reimbursement schedule compared to last year following the refinancing in Europe.
As well as the difference in the distribution levels from joint ventures in Canada that reimbursement in France for 2020 should high there'd be equivalent to 2019.
For the full year.
Our dividend distribution ratio now stands at 50% in a bit all of our 40% to 60% targets.
Our net install capacity stands at 2055 megawatts and with the grille patent pipeline presented earlier by Patrick.
We remain confident that we will reach 2023 goal of.
Oh, 2800, 2000 megawatt sorry about that.
Another important element that I want to bring to a you're a attention this morning.
If you follow your a your press worse on the optimization front is the closing we just announced this morning, the refinancing of our Niagara Windfarm project.
For.
The total refinancing of a total of 805 million.
Generating 5 million annual recurring benefit.
And providing the financial flexibility to reduce our corporate credit facility between 65 and $70 million.
Within the last 12 months, we have completed three they re financings totaling 2.7 billion dollar these refinancings greatly improved our financial flexibility.
Reducing our corporate credit facility by 258 million in generating total annual recurring savings of $22 million.
Getting back to results now.
Second quarter revenues fell pretty much the same pattern as production with growth compared to last year coming from the wind and hydro sectors.
The increase in hydro revenues is coming from the yellow false power station, which was selling at market price last year.
And this year, it's a did contract or became in effect.
And the de increased from 120 million in the second quarter of last year or 207 million this year.
<unk> for the went sector was 6 million or 6% higher than last year, and hydro EBITDA increased by 2 million or 16%.
Moving to cash flow now we generated.
The 1 million.
As far as cash flow from operations in the first quarter.
Down by 4 million compared to the same quarter last year.
Yes, I sold decreased by 20 million going from 16 million in second quarter last year to a negative 4 million. This year for the reasons mentioned before.
Timing effect.
As indicated on slide 18, our financial position remains solid.
Our net debt to total market cap ratio of 40% on June Thirtyth, 2020, <unk> compared to 56% on December last year.
In conclusion.
Results in the second quarter showed an increase in that they'd be in spite of reduction in our total production.
We are proud of the momentum committed to with all the promising optimization initiatives just completed an under way.
One last point as mentioned by Patrick we have a solid balance sheet I still looking for potential acquisitions or partnerships. If they represent added value and are accretive to our shareholders. Thank you for your attention. We are now ready to take your questions.
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At this time, if he would like to ask a question. Please press Star then the number one on your telephone keypad.
If you'd like to withdraw your question. Please press the pound <unk>, we will pause for just a moment to can probably too many roster.
[noise] your first question, but plenty of customer comes from the line of Nelson with RBC. Your line is open buttoning itself.
Great. Thanks, good morning, everyone.
My first question relates to the Repowering. So you have to Ah So you're working on several repowering facilities that two of them.
Due in 2022, I think the investment is about $38 million each with a a 3 million dollar.
EBITDA contribution can you just clarify whether the 3 million is.
The total EBITDA or the incremental EBITDA you expect.
Well I need to take this one it's a 10 million.
Yeah, it's the total.
Okay, so and so you're you're repowering it.
I guess, just under 13 times.
EBITDA I could you just a walk us through.
The decision to I guess free power rather than to re contract maybe or sell the the a sell the power generated under under merchant process or under a corporate P.P. again.
And how you decide to repower versus keeping keeping those facilities running.
Like we mentioned in the past, we always do arbitration.
Between the Repowering and to keep it running so the result of that the arbitration that comparison it was more beneficial to the power or a D. A these facilities.
Yeah, good compared to a keeping them on the spot market.
And the real estate market, Okay. It's that there's always a risk and the cool I pressure there could that could have been corporate P.A., but that we compare to the risk of the spot.
Okay and those facilities are are they in like 15 to 20 years old or oral does not.
Here or there will be 15 years old when we will that dismantle Dan and then and then Repower and we are building the turbine nothing exactly the same position. So we can we have optimized the time, where we there to shut down or we would have neulasta.
Actual them decide because we can do some foundation and Nexus words without without.
Touching the existing flat.
Okay, and then and then the cost of Repowering.
Is pretty similar to a new belt and given that it's mostly new equipment, but at least the permitting time is a lot quicker right is that the.
The way to everything I mean, squeaker Caribbean think time is quicker generosity you have some savings on axis and electrical connections.
Especially in this case because as you have seen the power is nothing cuisinart and on the other side oldest costs of the spending foundations and reselling turbines to Spanish company <unk> already interest. These two to two sites we knew.
Partners to do this and we are.
We we see we knew the cost we don't have any we had already experience, which thanks to show.
Okay got it and then my next question just relates to the optimization of I'll, let EM.
It looks like your skin sourcing some own I'm contracts or some own I'm asset or some assets and outsourcing or renewing the outsourcing contracts for for other assets.
Could you just talk about the Ike whether there's a cost difference to that whether you're taking a bit more risk in sourcing and.
And I think like Big picture like what's the cost savings and what are the risk differences, but that you look at.
Yeah, Indeed, we have the [noise].
So I actually sweet types of move during this quarter and one in France, which is a renegotiation of contracts with the was one supplier.
And in this case, we had to compare to try to internalizing everything to reducing the scope of their contract and we think that we are indeed.
And making more more money for for the risk we're taking on this on this contract in Canada.
We have a liking look like too.
Last year and themed river some years ago, we have decided to internalize.
And have been agreement to internalize all the HM dimension its work.
But I like so are we are a abuse the savings more money.
In term of risk, it's not deliver it's not more really because because it's a it's to the day to day work maintenance and does that is done by yes, but we are.
In a better position to optimize the production of these sites and when we compare books that we think it's the right decision here in Canada and finally in France.
Oh, there's a on the some nice it's coming from.
From the Kelly still a transaction, we have optimized to fully internal or maintenance. Since we are really Oh. We are we are used to these b study subjects and get into bites and Jim It's been integrated and Siemens Gummy sounds you knew when we think it's the what's the right way to do in Trimas.
Oh, the savings or it's just I was like approach produce a webcast I'm not disclosing savings you can see already some savings in the quarter.
This call through a in France, and the you wouldn't see them and equally be reflecting the you'd be viewed numbers. So it's difficult or considering the sensitive nature agreement with suppliers and partners to disclose you a precise numbers on this.
Okay. That's great and then just one more questions before I get back into queue in France in terms of the corporate <unk> I think ones for five years once for three years.
Could you just comment on the.
Economics of the a corporate P.P. as compared to I guess, the merchant power price and compare to the the feed in tariff like I presume, it's lower than the feed in tariff price, but how does that compare to the merchant price and then also three years versus five years. So like how long are corp.
That's a willing to go in terms of or the period.
Okay, starting by the duration the duration of the contract. Some some some corporations ones three years another's five years typically nobody is going and then we're not interested to go for less than three years. Now we had we have older negotiation underweight showed this is read the brackets, where we think.
It's good to be and on the other side more than five years or I mean, I'm not sure. We'll we'll go to this typically we are we're thinking now to Repower wouldn't need the Ali wind farm and you make a wind farm, where we have with five years contract was a whole since you know and a if we sign.
Well 10 years, we will not be able to repowering, so sometimes we need to be to be to keep some flexibility. When we we'd have the we have the duration and in term of price, but also.
In the French market, there that could be some reason for an increase of the of the price speakers. So the of the <unk>.
Do reducing.
Oh were nuclear power in France, Germany, and cool so she should they could be some pressure. So we need we want to not to go over five years or no.
In term of price when you speak about merchant price merchant price typically refer to deal had price. This this prices moving every day and there's been affected a lot by during the crisis in a dream dependent making the lock down in France, but if you look to the the price for next year or the full what.
Price full 2021. This has gone from C 50 to one thing the law, which was little bit over 40, and then games back to a little bit lower than that you referred megawatt hours. So and you can and we have signed with news Corp. just.
Around this bryce talks to 2021.
Forward price will next years, but again, it's essentially visits I think it's reasonable phobos, because you have to compare base load and and P.S. produced contracts, where a suit shoots good injuries most.
Of risk return for Bob Thanks.
Okay. So it's pretty close to the forward prices is what you're saying, yes, Ah lisanti <unk> into forward prices. If you look to it you can see that isn't it doesn't really not be affected by the crisis, because it's a it's a temporary situation on on on the.
On the deal had price.
Okay, great I'll get back into queue.
Thank you.
Your next question, but pushing because you don't come from the line of David because auto with Raymond James Your line is open putting it to them.
Thanks morning, everyone out my first question here just on the upcoming RFP in New York.
I'm wondering if there's any I guess qualitative comments you can provide on on the number of projects you're looking at how that's shaping up and and maybe just on that same topic I understand that that a nicer to how has the RFP that I think as the one year bidding on but I think then your power authority or.
So has won.
Little bit for that I'm wondering if that's one that you could also participate in in it and if any of your products could apply to both of those.
Yeah.
I'll answer that we will participate to boat RFP.
So we are projects that would shoot the two criteria that we know up then I'll each RFP. So oh, we don't want to disclose how many projects or the amount of Mega West for a company that competitive purposes. So don't indicates our to our Ah, let's see on other people bidding.
We're going to do with during this so these are.
But that tell you that we will participate.
Okay, great. Thank you and then maybe just I'm going back to your comments.
About potential restart of wind didn't come back or or that there may be more open to that now what kind of a timeframe. Do you think ballpark is added that is that a couple of years out or maybe more like five years out.
Okay, a there wasn't article in ER and ER.
Right, so yesterday and a it wasn't mentioning a it what's coming from I look at that that they were seeing themselves.
The let's see the end of their surplus or the overcapacity that they have the worth mentioning could since a few years a there we're seeing it by 2025 being a challenge your so Ah. So if everything goes away the anticipated that consumption to be and also exports.
No. They did what they're doing now with their power and Ah. So so we see if we think of 2025, we see the RFP probably coming in a that's in the.
18 months to come because if you want to build by 2025, you need to give us, let's say you need to giving them in order to a private producer like we are 2022 a at the.
Let's see would be a good date to be a up in operation 2025. So but this is a this is all new outlets is it just came out a couple of weeks ago from that Prime Minister of a goal and the article came out there and yesterday, we knew that especially bushy or the new president of Hydro Qubec has been a it's been a.
Oh I've been in the news since since since since our IPO hold so it's changing.
Changing a little bit the scope of what was done before and I don't come back. So we see everything are being very positive so.
That's my answer Okay excellent. Thank you for that color I'll get back into queue.
Your next question, but push I guess you cover some of the line of Mark Turvy with RBC capital markets. Your line is open but they need to though.
Thanks, maybe just picking up on your comments there Patrick Sophie coming in Africa back obviously, she was I got in Metro and you've got to the partnerships or around the salary to both <unk> and is there any increased thoughts from your perspective or any updated thoughts around expanding out and maybe exploiting wind down to you.
Murphy.
Oh, we're looking at all avenues that.
And ER, we mention a that see when there was the Massachusetts. The RFP, we did the submit didn't that RFP with hydro qubec. So we've been having good discussion since I guess and so while we're title connect for sure Hydro Qubec one on a standalone basis.
Yes, and in that RFP, but then there was a ah different proposal that weren't and one of them out was partly win from both Nixon, partly a hydro and ER. So so so.
Just to mention that we have discussion with I'd look at becton, ER and with the new team over there. It can only better the discussions are the relation between the two.
Okay fulfill possibility.
And then the comments on on looking at M&A, and saying, Hey, you know looking for creative and maybe just cannot mice again, when we define as accretive to the is it on a NPV basis in the near one free cash flow and then.
What else would you guys thinking about from a from M&A or partnerships around on target of either and developing or more operating assets and.
You're looking at.
I can I can take that Patrick cat.
Yes.
[noise] little a mark I guess he a straight answer is we were pointing out quite a bit of emphasis on on free cash flow per share.
And Ah Trust that that's an important points.
And spawned a on the basically that they yield also we want to make sure that we.
No.
Do you get an appropriate yield on that so.
On on larger M&A, a we clearly have quite a bit of that money.
Possibilities on the smaller ended the scale with a wind developers and so on but for larger stuff. There's there's a clear focus that it's accretive on the free cash flow for share for shareholders.
Is that necessarily day, one or if there wasn't development assets it could be maybe over a clear paradise you bring on assets or any other color you can provide around timelines for accretion.
Well, we certainly want it to be a we aim certainly for.
Hopefully to for at 12 to 18 months accretion.
Okay, and then when you talk about partnerships you know it from a financing perspective, it would really lean on a partnership or what weather Oxiclean figures are now thinking about partnerships that will be key item for you guys know the head on.
I can answer that because that's because you haven't seen.
Partnership could happen in many many ways it could be a partnership participation or in partly into some assets or so in that and then acquisition or do I have a partner to acquire something so so this is the way that we see a partnership so it's.
Maybe it's going to its always to help us to Abbott better Ah that's a better return of the biologics and Abbott financial partner, because a week or whatever in the partnership.
More lifting free cash flow by managing and things like this and this would Ah Ah this with better to situation for a for Alex a return compare to the to the overall acquisition of a projects are where because we know on the acquisition then.
Sometimes the return or low. So this is why we see ourselves DDIC partners.
Okay.
My last question is maybe just around the dividend you're sort of in mid point of view on your payout ratio range, but maybe less focus from investors from income perspective in this space and more around growth and you guys have a healthy pipeline. So we'll give you more lean towards moving the parish into the lower end of the range or any up his perspective on the importance of.
Have a parent capital for the dividend.
Well <unk>.
<unk> comfortable we're comfortable with our dividend policy at the moment.
And this payout range.
Our projections show that.
It's a working while some from our plan perspective to allow us to reinvest money and growth.
And.
The the payout ratio seems to be a to be in the right ballpark for shareholders at the moment.
Okay. Thanks for now.
Your next question, but pushing guess deal comes the line of Rupert Merer with National Bank. Your line is open but they get to that.
Good morning, everyone.
I think one or two started on a on the development activities in France, you mentioned, the new land to low and Kojak.
71 megawatts now as being a bit into a call can you walk us through <unk>.
What happened with that project of course, you had a P.A. previously.
Hi, there was some pushback Phil on the pro Jack So imagine you'd given up on this previous a PPA anyway can you can you walk us through how we got to where we are today.
Good.
Yes, I will do.
The.
The first overrides Asian owns 51 megawatt.
As you remember as being canceled by the first level of course re read enforced by the second cool that then and then no. We are Oh, the will say did the last the last level lower courts in Prince just on the.
And they are looking just on the form of two full maliki of the queued up in decision to this is still pending and but we're confident about the fact that the queued up in its in the right John.
We have obtain just by the end of June yields right station from the <unk> Bussell building friends, even if Youre. Your final decision is spending to improve the size of the turbine and go to 71.
This has allowed us to bid in the tender offer Oh July through some July which was up 260 megawatts, then there and the and then if we win new Spender.
We will have 20 years contract again for this project.
In the duration and we have three years to to build the project after the tender or when when we are when we when it.
But the delay is frozen if you have any recourse against the project. So we will we will hopefully freeze a price for 20 years for this project what ever or the next to.
Court procedures.
Yes.
Just had Rupert just to add to what Patrick just mention or.
If you if we do we do remember for sure but that this will answer the want 51 megawatt what was on the two 2016 program, which has expired being at the maximum capacity of the program. So this is the reason why this one loss, it's contracts or and now we a weekend submitted in the news.
And a new are.
Okay. Okay can you remind us how about you had invested I think it was about 60 million and I believe you had some recourse to recover some of those funds. So when you're looking to bid this and into the next call you treat that investment as a sunk cost or or or the economics of the next caller.
Possibly attractive enough that I feel come out ahead of where you were.
2016 call.
Well, we did a write off on that a and correct me, but we know if I'm wrong, but.
At the end of December.
2009, partials partial write offs.
Yeah, and there so a will will not counted the rest of the let's see of.
Spendings under this projects.
Into the into Uganda make up there.
<unk>.
Okay. So we should treat that previous investment as or some cost at this point.
Yes, well that the government and off portion.
Okay.
And secondly on on development cost so they were down little bit in the quarter did this hamper or slow down and if youre development activities and and should we expect the development cost to rebound in coming quarters.
I think took us.
Yes.
It's essentially no or or or our budget dogs development is sometimes moving from one called closer to the other digging into it comes opportunity Oh emerging during Q2. It was a some some of 'em or some way.
Words was not possible to be done so that could be teams are working hard so they could be some some rebound, but the the annual budget will be respected and and we are working hard to develop the company.
Hi, Thanks very much.
But your next question, but pushing Guestroom comps in the line of John mode with TD Securities. Your line is open putting into that.
Good morning, you mentioned in your news release, you're working on U.S. corporate PPH can you provide a little more color on that efforts, where you're potentially looking beyond New York state and and what the scale of opportunities is that you're considering.
Renew or something.
Well I take a minute.
Yeah, essentially yield on call incorporate p.. We are we are concentrating on New York State.
For the moment, we are we are looking more for.
And then Oh outside the New York State, whereas for the moment on.
But not.
Yes.
Okay.
And then maybe moving just back to France, and the broader competitive environment. There you've got a lot large early stage pipeline.
French seems to be getting more attention from larger developers and I'm thinking of either draw those announcements from June beyond the regular tenders, you're participating what does the competitive environment look like for securing earlier stage development opportunities in France right now.
Yeah the.
But they should've known on on securing proved Jake.
See lands or grid connection.
That's not really change the question is more to come fishing is more the fact that.
Small companies or or you Ed will probably be seen the nordics, a I've sold to a developing pipeline to R&D, but you really big companies are arriving but there are no.
Uh huh.
I stay humble but.
They're not they're not managing their team better than us in term of Green She did love and so on this side there is no.
No real change Oh still landscape and for the moment.
And I think I think the duration also did luffman friends.
When it will not change a lot on the on this site.
But it's it's an impact on the bus would be to make partnership with some developers because obviously developers move developers are informed by the the interest of the big companies.
It's definitely something well and that will you know development in France is done with the boots on the ground. The big guys. There acquire a pipeline for sure the acquire a smaller developer.
But we still have a team.
Our team is still ongoing I liked it was mentioned we had over 100 megawatts of new projects. So so this has been going on for years and do the reason why we have over a thousand megawatt project that's been done we're adding.
Over time, so or so yes, the big guys. They can come in but a where we've been that we have an established steam and friends that can sign land lease that can look at the grid and to see if they there's capacity over there and for sure and monitor Ah the win where the best when is where to find those athletes.
[noise]. This is my answer.
Okay. No that's very helpful detail and maybe just lastly on the your your project in Scotland limestone any any updates on progress there a in securing a offtake offtake agreements.
We are we're working on this Q2 was not the it was not the best moment due to do this but we're still working on this there is there is interest but nothing to tune to see two d., we have done some pretty big <unk> preliminary work on the on the site.
Turning to keep the construction planning and we would work during the next to the next quarter about securing the financing and ER and the partner.
[noise], Okay, I'll get back into queue, thanks very much.
Again, if he would like to ask a question. Please press star one on your telephone keypad.
My cost with this isn't the money. They just don't be completed its when she did you see what could that be telephonic.
Next question, but push I guess you comes into line of Nashi, They doing with industrial Alliance. Your line is open but thing to though.
Hi, good morning.
Just wondering if you could talk more about the corporate to pay market in France the to deal with <unk>. It's very interesting there obviously quite a large corporation and I think that establish their own clean energy targets I think it's 50% renewable energy by 2025 I'm. Just wondering if you can comment on the partnership with the launch how could that evolve over time.
Yeah, essentially the first to the first step the was signed a beep year with them. They are they didn't have to define the ambitious.
Targets there are not the only one in France, a big good re known cooperation doing this just situation is the there is nothing lopped off assets.
They liable for the moment, because because everything is being sign a 15 years ago with media. So a lot of assets are our sign we are one of the if you. If you remember in by the end up 22.
2005 bottlenecks owns 90 megawatt wind and was the first the.
Layered another first independents that you're already.
So we have we are one where the winning was the first when you can send electricity from existing sites and this is interesting thing the next step.
We'll be indeed to Oh pretty Wendy.
[noise] offer new project.
For these people with a long term contract we should not be five years in this case to secure financing there was already <unk> one tender from my knowledge about this in trends we have not been successful than this but we did you see that it's a tendency of the market, though the Big Corporation, who wants to be greener.
<unk> for on one side years T., a question and on the other side customers and branding. So we are we're discussing was all these people in its good because the board there should we go home and also the new contract with the repeat or will show, which is very well known in France.
Just on the on the place as a new name and the Youd see start of the new branding for bottlenecks in France.
And would you like when you're looking at some of these assets that are coming off that P. AIDS, let's say over the next few years with the with the S.
So when you would rather have a or sign corporate p. a's rather than maybe try to renegotiate or extend contracts with a death.
AH Yes. There is there is no possibility to to extend the contracts or renegotiate with <unk>.
Really the it's possible to Sun was easy if aggregator jittery, but but not renegotiated contract with the be corporation. So in this case, that's what we have than the last three years on the first three assets. You you can you can son who's aggregator but.
We were negotiating presently the next the next project outdoor I'd be shown rules, which is ER will be beginning of 2021.
A new contracts that started in 2006.
When negotiating was interesting corporation also to secure a corporate BB with them and we are all the time comparing to the possibility of Repowering Oh the project when its winning Repowering is very very accretive in interesting to US then we it's better to Google reporting because we're securing today 20 years.
On track and the and that's metric mentioned, where nothing exposed to any market risk.
So we are playing ball both games parallel for any project and looking in screening everything.
Okay got it that's where they tell so <unk> you know not not sticking to one property. Other it's kinda by a site by site basis, you decide whether to repower or look for corporate <unk>, Oh, yes, Indeed, I mean could evolve in time.
[noise] I was just the market situation older technology can change or yields right nation can also.
The be easier to obtain wouldn't please.
Okay. Thanks, Thats, what I did so maybe just one other question I I know you don't have any specific targets for storage and they are a current a strategic objectives, but just wondering if you can give us an update on generally your thoughts on storage and when opportunities you might be saying and that's acknowledged you're going forward.
[noise]. So [laughter] generally on on that we are working we have one side in France, we are monitoring the revenue and monitoring all each works so.
This is one thing we have another project we're working on on one the other side when we wouldn't have subsidies to two to build a small system, which will be a small project, but the initial to learn.
New York State storage.
As a on its own is is it purely merchant market and so we don't want to do this but storage.
Combined with the with solar project. We're working on this also on the small size, especially to learn but there is a as you probably do you have seen the reserve.
Fortunes target storage in New York for the next year. So we will follow that then and learn from the next years and you do something in the future.
Okay. Good thank you.
Yes pick it still I suppose there are no further questions at this time I'll turn the call back over to our presenters.
All right. So thank you very well. Thank you operator, and thank you everyone Floria your attention and if you have any additional questions. Please call me at five one floor to one three 104 or five I'll make sure we quickly answering questions.
And Ah that I would like to say that our next conference call to announce third quarter results will be on Wednesday November 11.
I hope you all remain healthy.
Okay, great. They can see you next quarter.
[noise] Saddam Hussein Nicholson, our social she didn't know if I could see this concludes today's conference call for today you may now disconnect.
[music].