Q3 2024 Boralex Inc Earnings Call
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Bonjour Mesdames et Messieurs et bienvenue à la conférence téléphonique portant sur les résultats financiers du troisième trimestre 2024 de Buralex. Veuillez noter que toutes les lignes sont en mode écoute seulement.
At the end of the presentation, there will be a Q&A session during which financial analysts, shareholders, and investors will be invited to ask their questions by pressing star 1 and 1 on their phone.
Please also note that this conference is being recorded.
For the webcast participants, you can also ask questions during this conference, but they will be answered by email after the call.
Speaker Change: Finally, media representatives with questions are invited to contact Camille L'Aventure, Senior Advisor for Public Affairs and External Communications, directly at the code indicated at the end of the quarterly release.
Speaker Change: I would now like to give the floor to Stéphane Milot, Vice President of Investor Relations at Boralex.
Stphane Milot: Good evening ladies and gentlemen, and welcome to Boralex's third quarter financial results conference of the year 2024.
Stphane Milot: Please note that all lines are in listen-only mode. Following the presentation, we will conduct a question and answer session in which financial analysts, partners, and investors will be invited to ask questions by pressing star 1 and 1 on their phone.
Don't forget that the conference is being recorded.
Stphane Milot: For the webcast participants, we can also ask questions during the conference, but they will be answered by email after the call.
Stphane Milot: Finally, media representatives are invited to contact Camille L'Aventure, senior advisor Public Affairs and External Communications.
Stphane Milot: Your contact information is provided at the end of the press deadline quarter.
Speaker Change: I would now like to turn the conference over to Stéphane Milot, Vice President of Investor Relations for Boralex. Please go ahead.
Stéphane Milot: All right, thank you, operator, and good morning, everyone. So welcome to Baralex's third quarter resolve conference call. So joining me today on the call, Patrick Decostre, our President and Chief Executive Officer, Bruno Guilmette, our Executive Vice President and Chief Financial Officer, and other members of our management and finance teams.
Stéphane Milot: M. Decostre will begin with comments about market conditions and the highlights of the quarter. Afterwards, Mr. Guilmette will carry on with financial highlights and then we will be available to answer your questions.
Stéphane Milot: As you know, during this call, we will discuss historical as well as forward-looking information.
Stéphane Milot: When talking about the future, there are a variety of risk factors that have been listed in our different filing with securities regulators.
Stéphane Milot: which can materially change our estimated results. So these documents are all available for consultation at CDARplus.ca. In our webcast presentation document, the disclosed results are presented both on a consolidated basis and on a combined basis.
Stéphane Milot: When talking about the results, we generally refer to combined numbers, and when referring to cash flow and balance sheet, we generally refer to consolidated numbers. So please note that combined is a non-GAAP financial measure and does not have a standardized meaning under IFRS.
Speaker Change: Therefore, Combine cannot be comparable to similar measures used by other companies. For more details, see the sections on non-IFRS and other financial measures in the MD&A.
Speaker Change: The press releases, the MDNA, the financial statements, and a copy of today's presentation are all posted on Bagalex's website, at bagalex.com under the Investors section. If you would like to receive a copy of these documents, please contact me.
Speaker Change: M. Decostre will now start his comment. Patrick, you can go ahead.
Thank you, thank you Stéphane, and good morning everyone.
Speaker Change: It is a pleasure for me to present our results and achievements.
Speaker Change: During this quarter, the third quarter of 2024, we actively pursued our development and diversification activities in a period affected by adverse humidity conditions in Canada and France, which impacted our results.
Speaker Change: On a year-to-year basis, we observe an improvement in all our financial metrics. We have increased our EBDA by 7%, our operating income by 15%, and our net earnings by 32% compared to the first nine months of 2023.
Speaker Change: During the quarter, we continue to make good progress on building our support project in Quebec and our Lionkin project in Germany.
Speaker Change: We are very happy with what our teams have accomplished on both sides. These two projects should be commissioned as planned by the end of the year.
Speaker Change: We have also started the construction of our two storage projects, Agersville and Tilbury, in Ontario. These two projects are scheduled to be commissioned at the end of the year 2025.
Speaker Change: In addition, our wind project for the south of Dénèche and our storage project in Oxford are progressing as planned, with commissions scheduled for the year 2026.
Speaker Change: Finally, in North America, we are currently awaiting the final results of the NYSERDA proposals in New York, which are expected to be announced soon.
Speaker Change: In Europe, we are very happy to announce the acquisition of the SALAKI project, a 50-megawatt advanced wind project in Scotland.
Stéphane Milot: This transaction adds another exciting project to our strong wind portfolio on the Isle of Scotland and represents a key step towards the future.
Stéphane Milot: to achieve our goal of strengthening our presence in the high-growth potential market of the United Kingdom.
Stéphane Milot: This quarter, we also achieved significant milestones in our client's strategic direction by signing two long-term renewable energy purchase agreements in France with major industrial companies Nestlé and Saint-Gobain.
Stéphane Milot: This success demonstrates the expertise of creativity and the creativity of our marketing team to support new clients in their energy transition through a balanced solution.
Stéphane Milot: It also shows the increase in competitiveness and the support for renewable energy, even for industrial players.
Stéphane Milot: In terms of market conditions, the demand for renewable energy in our markets continues to be strong, providing a favorable environment for the operations and development of our activities.
Speaker Change: In the United States, we understand that the implications of the election on the renewable energy sector are a key point.
Speaker Change: We will continue to develop our pipeline and produce cost-competitive renewable energy in markets driven by an increase in demand for clean power and strong state-level support.
Speaker Change: In Europe, the election of the Labour parties in the United Kingdom is very promising, with several measures to encourage renewable energy, such as increasing the bank on export power in England.
Speaker Change: The government also announced the creation of the state entity Great British Energy to lead the deployment of clean energy and energy independence.
Speaker Change: I will now rapidly cover the main variances in our portfolio of projects and growth paths.
Speaker Change: The change in the pipeline was mainly due to the addition of wind, solar, and storage projects in Europe and North America in the previous period.
Speaker Change: and the renewal of the non-strategic welding project in Germany.
Speaker Change: Transition of wind and solar projects through the pipeline to the mid and advanced stages in Europe.
Stéphane Milot: In total, our morning and afternoon project pipeline consists of a project totaling 6.4 gigawatts of wind, electricity, and storage projects.
Speaker Change: In the second quarter, the development path represents a capacity of 867 megawatts, an increase of 16 megawatts compared to the previous quarter.
Speaker Change: This increase was mainly attributable to the progress of the solar project in Europe at the security stage.
Speaker Change: Our total projects in development, security, and under construction is 7.2 gigawatts.
Speaker Change: Regarding the progress made in our growth and diversification strategies, I have already covered the key points in the introduction.
Speaker Change: On the optimization front, we were pleased to announce the closing of a $95 million financing for the closure of the Temis-Quatar II farm in Quebec.
Speaker Change: This completes my part. I will now let Bruno cover the financial portion in more detail, and we'll be back later for the question period. Bruno?
Bruno Guilmette: Thank you Patrick. Good morning everyone. I will start with the financial highlights of the quarter.
Speaker Change: The total production is less than 1% compared to last year and less than 11% than expected due to unpleasant weather conditions and the increase in electricity power in France.
Speaker Change: As a result, our combined EBITDA amounted to $109 million, down $4 million, and the FFO amounted to $16 million, down $7 million compared to the third quarter of 2023.
Speaker Change: I will now review the progress made in light of our 2025 corporate objectives.
Speaker Change: Our balance sheet remains quite strong, with 608 million euros in available cash resources and high growth financing.
In addition...
Speaker Change: 51 million euros are accounted for maintenance and other receipts, representing approximately 85% of the ITC to be received based on the qualified properties acquired for the APRIT project under construction in Quebec.
Speaker Change: The total debt remained stable during the third quarantine of 2024, with project debt accounting for 90% of the total.
Speaker Change: The reinvestment ratio is consistent with our target of 66%.
and the initiative of a science-based target based on the SBTI.
Speaker Change: This certification is a great achievement and demonstrates that our CSR strategy creates value through effective management and the differentiation we bring to the renewable energy sector.
Speaker Change: I will now provide more detailed information on our financial results for the third quarter, starting with production.
Speaker Change: In North America, the total production for the quarter is in line with last year's, but 10% less than expected.
Speaker Change: The production of wind energy was 5% higher than last year, but 10% lower than expected, due to weak resource conditions in Canada.
Speaker Change: The production of the hydro sector was 20% lower than last year and 5% lower than anticipated due to unpleasant humidity conditions in Canada, compared to a strong five-year period in 2023.
Speaker Change: The production of solar silver is 2% higher than last year, but 15% lower than expected, mainly due to the demands of the National Assembly in California.
Speaker Change: In Europe, the total production was 3% compared to the last quarter and 12% less than expected, attributable to unpleasant winter conditions.
The increase in curtailments in France.
Speaker Change: As mentioned at the beginning of my presentation, the decrease in production has affected our revenues in EBITDA and AFFO, with the contribution of new sites and our sales optimization strategy partially mitigating the decrease.
Speaker Change: Our financial positions remain very strong, with a total ratio of 43% in the total debt market.
Speaker Change: In conclusion, we remain focused on the discipline and execution of our strategic plan.
Speaker Change: As mentioned by Patrick, we have delivered strong results to date.
Speaker Change: Significant increases in key metrics, such as operating income and net income.
so far this year compared to last year.
Speaker Change: The future of the year is very promising, with the commission of the Préhension du Québec in LimeKin, Scotland.
Speaker Change: We are also actively working on the financing of our battery projects in Tiltbury in Agersville, Ontario.
due to the increase in demand for renewable energy.
Speaker Change: and remain very positive about the future of Boralex and our ability to generate the expected revenue from our investments.
Speaker Change: Thank you for your attention. We are now ready to take your questions.
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Speaker Change: Thank you. Until a recap. Can you ask your questions about the backpoles? Please press 1 and 1 on your phone and wait for your name to be announced. To ask a question, press 1 and 1 and then again. Once more, press 1 and 1 on your phone and wait for your name to be announced. To ask a question, press 1 and 1 and finally, again.
Speaker Change: If you wish to ask questions through the webcast, click in the question box and click on Submit.
Thank you.
Speaker Change: The questions come from the Nielsen-Ning line, from the RBC Capital Market. Can you ask your questions?
Speaker Change: Good evening everyone. My first question concerns France, and it is a multipart question.
Speaker Change: Can you talk about your PPA strategy for new projects under development? I just asked if you prefer to participate in government RFPs or sign PPAs.
Speaker Change: And also, I assume that physical PPAs have a higher power price.
Given the lower off-take credits.
Speaker Change: And finally, if a project is unsuccessful and the government asks, can you try to obtain a corporate PPA for this project to be developed?
Speaker Change: Good evening Nelson. The strategy of Incorporate PPA for us is to target specific clients with specific needs.
Speaker Change: There is a specific need and we understand that and we provide values. So, the consequences, generally, are a better return for us.
Speaker Change: when we have this kind of opportunity, because we provide a specific service to a client. There is always...
for the project
Speaker Change: a safety net of a government RFP, and we just don't...
Speaker Change: received confirmation yesterday that we won another 21 MW project. It is not in the document because it came yesterday, a 21 MW project.
Speaker Change: in France, in the latest RFP from the Energy Regulatory Commission. The average price of this project is about 88 euros per megawatt-hour. So you see, exactly as you asked the question, there are different options.
Speaker Change: and we are going to the best option for Boralex. Of the six projects that are under construction in France, five are with the corporate PPA, and I think this is an interesting market trend.
Speaker Change: Ok, that's quite interesting. So, these are the corporate PPAs in these 15 to 20 years?
Yes, it depends. Nestlé is 15 years old and Saint-Gobain…
All the others, like Auchan, Métro, Weir, 20 years contract.
Speaker Change: We therefore supported their funding project, which is also an important criterion.
Speaker Change: who finance the project and who have been used in recent years to finance the EDF-PPA-backed financing, did not go through this corporate PPA. So, it is also an important movement in the financial market in France.
Speaker Change: One last thing about that. Obviously, corporate PPAs have a lower yield.
Speaker Change: So, from a financial point of view, what are you expecting?
Like a wider margin and potentially...
Speaker Change: That's the case, but overall, what we will see is that we have a better reward for Boralex.
And we do not have any bad counterparts.
and other companies in good standing and long-term.
Speaker Change: I think the cost is a bit higher, but in the end, the revenue is significantly better for us. Otherwise, we are not going to do this project if we don't have an EVF contract.
Speaker Change: I have a few questions about the Ontario battery project. Haggersville and Pillery, I think that sounds like the total cost of these two projects.
is approximately 770 million.
Can you tell us about the trend in battery costs?
Speaker Change: Cost savings when you start your Oxford battery project potentially next year.
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Speaker Change: I don't have the exact cost of the battery from Agersville, Ontario, and Tilbury.
Speaker Change: Secondly, yes, it is not completely finalized and public, but the Oxford...
Speaker Change: The battery costs are lower than those of Agersville and Tilbury at the time we ordered the battery. That's what goes south and the right side for us.
OK, and then maybe…
Speaker Change: Excuse me, Nelson, I just have a point on that. As you mentioned, these projects are now under development, under construction.
I think this is what you are talking about regarding investment.
Speaker Change: The amount is in fact slightly lower than what we were expecting originally, and it's a mix of...
Speaker Change: There are a few elements like the cost of the battery, of course, but also the BOP and some savings here and there. Generally, the conditions are better than those we had at the start of this project.
OK. And then, can you talk about...
How do partnerships with the United Nations work? Is it 50-50?
the first two battery projects.
Speaker Change: Do you want to talk about Bruno Deft's fund for the Church of the Church?
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Speaker Change: The financing of the two battery projects, Agersville and Tilbury, we hope to have good news before the end of the year. We are actively working, as I mentioned, on these financings. It seems that it is underway for us to complete and close.
That's what there is this year.
Speaker Change: on the run rate EBITDA. Do you want the run rate EBITDA for these two specific sites? Is that your question? Yes, relative to the CAPEX 770.
This is part of our disclosure in the MD&A.
Speaker Change: to look at that, or we could talk about it after the testimony, if you want a more precise number.
I am going to go watch some.
Speaker Change: And finally, regarding the partnership with the United Nations, is it a 50-50 partnership or is it a different arrangement?
Yeah, it's both 50-50 partnership.
Speaker Change: Ayersville is with the Six Nations of the Grand River, so we already partnered with them in 2016, or even before, for the development of Niagara.
And Tilbury is with the island of the old bridges, it's 50-50.
Speaker Change: It was their first partnership, but the negotiation was going very well and we were very good partners. We were very good long-term partners in Inglesville and new partners, but we were very good partners throughout the whole island of Paule and in Tilbury.
Thank you, I will stop there.
Thank you.
We will now proceed to our next question.
Speaker Change: The questions come from Sean Stewart's line at TD Cowan. Please, ask a question.
Thank you, good morning to everyone.
Speaker Change: Question about the perspective pipeline in Quebec. I wonder if you can provide some updates on...
Hydro-Québec's plans, which are clearly aggressive, and invisibility on...
Speaker Change: future partnership opportunities going forward and how that feeds into your longer term.
especially to one's own development ambitions.
Speaker Change: Yes, hello Sean. Indeed, the Hydro-Québec plan is very aggressive because it doubles the size of Hydro-Québec from today to 2050.
Speaker Change: and renewable developments. We are clearly focusing on that. I would say it is currently under clarification
Speaker Change: by the government and Hydro-Québec, but definitely the role of the government, Hydro-Québec and the public sector, the private sector, sorry, would be a part of that, the First Nations would be a part of that.
and I have...
Reconfirmation.
directly from Hydro-Québec to say...
Speaker Change: that we have skin in the game in terms of equity in the project.
Speaker Change: The example they were already taking in May and continue to take is the Dénège project, which is the third phase of 400 megawatts with us, where we own a third.
Speaker Change: Énergir own one third and Hydro-Québec own the other third, so I think that's a successful partnership. And this project is going well, so I presume they will build on this type of project for the future.
Speaker Change: What happened in the press is that Hydro-Québec is operating, as they have seen.
Speaker Change: to try to find an agreement with the United Nations and the municipality to move forward on a larger project.
Speaker Change: I suppose they will also continue to do the classic route of, I don't know if it's annual or...
Speaker Change: Every two years, the RFP trend for smaller projects. But no, it's interesting because the small projects are 350 megawatts. It's still a small project in Quebec, in the new language. So, it's also a good signal that there are plenty of opportunities for us.
Patrick Decostre: Thank you for this detail. And I also appreciate your comments on the current growth opportunities in the United States. What are your thoughts, Patrick?
Patrick Decostre: Risk-adjusted returns, the best markets for long-term opportunities. I think that last time you mentioned the fields in the UK.
Patrick Decostre: It's a particularly competitive market. Has it changed in order relative to the past three weeks in terms of your preferred focus for growth perspective?
Speaker Change: I am not changing my point. I think we have a lot of opportunities in Quebec, Ontario, and the United Kingdom. These are the three places where, in the future, we will have many opportunities. As you know, we have...
590 megawatts in New York, the latest RFP.
Speaker Change: I am waiting for the final result, I don't know when but I don't know if it's soon. It's also a good turnaround for the RFP. The point is that today...
It's…
Speaker Change: It's a very good result to achieve 10 to 12 returns in different markets. The goal is to develop the right project and that's exactly what we are doing in these different markets. I don't see a big difference in return expectations currently on our site.
Speaker Change: OK, that's great detail. That's all I have for now. Thanks very much.
Thank you and have a good day.
We will now proceed to our next question.
Speaker Change: The questions come from Jessica Hoyle's line at Scotiabank. Can you ask your questions?
Thanks. Good morning, everyone.
Thank you for taking my question.
Good evening, Jessica. I think what is important is...
We have interesting developments.
more than expected four years ago in Quebec.
Speaker Change: It's not a question of diversifying our portfolio, but on the other hand, we have an important project.
Speaker Change: and the capitalized deployments in Ontario regarding battery storage, which is a completely different business model, with a completely different contract.
Speaker Change: to optimize our sales reduction strategy. If I go back four years, we were probably a bit too exposed to France.
in terms of diversification. It's a very good market.
Speaker Change: But in terms of diversification, it was a big part of Boralex and we sold 30% at a very attractive price. It's also a way, in the end, to have a more diversified net cash flow. So we expect, we will also use this...
Speaker Change: It's a way to optimize our diversification of cash flow, and if we can carry out large-scale projects in Quebec, we will continue to do so and have partners at the right time.
Speaker Change: on this project to not be too exposed in one place. And that is also the reason why we are developing in the United Kingdom, which is also a completely different market in terms of resources, regulation, and prices.
Patrick Decostre: I would like to add to your point, Patrick, that there is also this week, we have seen a positive impact from the American acquisition, which we did in the wind, where, you know, in a week where we had difficult conditions in Canada and France, we achieved very good results in the United States.
It is also another market where we benefit.
Diversification
Thank you. Thank you. Thank you.
I appreciate the color.
Stphane Milot: Stphane, could we see more resources invested to improve and further enhance your storage pipeline?
I am not sure that I understand the question.
Speaker Change: I am just looking for a bit of color on the addition to the storage pipeline. Can you give us more details?
Speaker Change: Yeah, sorry, sorry. Yeah, we are essentially in Ontario, what is coming.
Speaker Change: The three projects are short-term, the 200 constructions, then Oxford, probably next year. And then we have...
Speaker Change: We are developing a project for LT2, and for LT2, the next RFP, there will be production, energy generation, and there will certainly be capacity.
Speaker Change: Will storage be a part of this or a hybrid site? We are preparing for that. The answer is yes.
Thank you to Stéphane Milot and Bruno Guilmette for their presentation.
Speaker Change: As you know, storage for us makes sense where we have long-term contracts.
Speaker Change: or sellers' markets, which is less interesting for us at this moment.
Thank you.
We will now proceed to our next question.
Speaker Change: The questions come from Benjamin Saïm's line at BMO, please ask your questions.
Speaker Change: Hello, thank you, hello. A few more questions about Ontario's storage projects. Can you confirm the CAPEX cost? Is it all settled at this point?
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And you put the batteries on top.
– Subtitling ST' 501
Speaker Change: It is probably the largest project you have built in your history.
Speaker Change: You're feeling pretty good about execution, risk and timing, and how you're moving forward?
We have decided to work with Tesla.
Speaker Change: I think it was part of our decision last year to go with them because they were selected by Northland to do the AIDA. So, if there is a learning curve for them, in Ontario specifically, above all,
With their knowledge.
the United States, Australia, and somewhere else.
Speaker Change: They will do it with Oneda, and I think it will go well.
on the second part, on the balance of the plans.
Speaker Change: We are working with Borea. Borea is a well-known company originating from Quebec, but it has developed many wind and solar projects in Canada and the United States. So, we are in good hands and we have a specific team. I am quite confident and the project is going well. The team is doing well, so I am not...
who are specifically interested in this project.
Speaker Change: OK, it's good to hear. My question or our topic is about Scotland.
Can you speak, perhaps, at a High Level?
I think that Scotland...
Speaker Change: Transpiring in the next few years, in terms of where do you want the development pipeline to be?
Speaker Change: I hope there will be much more money to deploy and at what percentage it could be a part of the total company.
Speaker Change: There is generally a delay in the United Kingdom. The offshore wind solution is delayed. At Key Point, the big nuclear plan is also delayed.
Just starting.
for the next one.
Speaker Change: It's an opportunity for us to study the environment and engineering, and they don't know exactly where they are going. I think there is a good opportunity for wind and solar abroad, and overall, in the United Kingdom.
as a partner of the BOCALEX pipeline.
Speaker Change: We have a team of nearly 20 people there today. The acquisition of Saraki is an interesting matter, as it is a German developer, WKN, who wanted to exit.
Speaker Change: to concentrate their resources as German developers in Germany and Poland. They have therefore decided to sell this project. It is a very beautiful project, fully permitted. We will therefore optimize it. It is very similar to what we did in France.
15 years ago, and which consolidated different...
Speaker Change: organic development, mid-stage development, and maybe one day operational assets to build an interesting platform, a consistent platform in the UK. I think that's exactly the long-term vision I have.
OK, perfect. Thank you.
Thank you.
Speaker Change: As a reminder to ask a question, please press star 1 and 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 and 1 again. If you wish to ask a question via the webcast, please type them in the question box and click Submit.
We will now proceed to our next question.
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Speaker Change: The questions come from Mélissa Dean of National Bank Financial, please ask your questions.
Hello everyone, it's Philippe Rupert.
Speaker Change: For your capacity target for the year 2025 of 4.4 gigawatts,
Well... Sorry, Bruno. Go ahead.
Bruno Guilmette: Regarding the objectives for the year 2025, we remain confident that we will be able to achieve them. Just a reminder that these objectives include some M&A activities, some acquisitions.
Bruno Guilmette: and that's why I think it's been mentioned a few times that we have been less active voluntarily on the M&E front because the prices were too high. Now, the situation is better from an M&E acquisition perspective in terms of price and valuation. So, we are actively looking at opportunities, mainly in the US and American markets for M&E.
Speaker Change: and specifically to your question, it can be a combination of larger sales and other acquisitions like Senekey that we just talked about, which Patrick mentioned, in the UK. So it's really...
In terms of guidelines, we keep our confidence.
Speaker Change: Thank you. And Burlesque already has liquid support for you, but if you are in Grosse or M&A, what tools might you consider to support your growth, and what would you say is the most attractive for you that refinancing does not stop?
Speaker Change: In terms of financing, I will start by saying that we are in a very good position.
Speaker Change: competitive market, competitive bids from our lenders and strong interest. So looking good on the project financing side, still an important portion of our financing strategy. In terms of...
Speaker Change: the needs for equity, with regard to what we currently have.
without taking into account M&A.
For example, we are...
Speaker Change: we will always have good visibility for the next 12 to 18 months. It's not a big concern, but I think your point of interest also applies to M&A. And depending on the size of the M&A, it can be a combination. We are looking at different possibilities, different frontiers.
Speaker Change: if it is a larger acquisition than this one or a sale of assets, but we are working on different fronts.
Speaker Change: and, depending on the creation of more value for the partners, we will do this if we need to finance a large acquisition.
At the moment, if we look at our testing ratio,
Speaker Change: In general, I'm sorry, I went out of line here.
Speaker Change: So we have other opportunities to manage, either at the corporate level or at the project financing level.
Thank you, I will leave it there.
Speaker Change: And we have, I believe we mentioned it, more than 600 million in available assets, funds, and financial assets available.
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We will now proceed to our next question.
Speaker Change: The questions come from Marc's line. Jarvie from CIBC, please ask a question.
Thank you. Good evening everyone.
Speaker Change: Are there any concerns about acquisitions, particularly on the American front, with the American election?
Speaker Change: Does this slow down activity in this market? Does it give you pause? How do you view the election event in terms of the appetite you have for business in the United States?
Speaker Change: I will start and maybe Patrick can add something, because there are two aspects to your question. M&A, and M&A if we look, I mean...
in terms of existing assets.
Speaker Change: It may be less of a problem for a few years. This can happen if we look for strengthening options.
Speaker Change: I would say, depending on the types of assets we acquire, that we still strongly believe in the U.S. market, election or not, if you remember.
Speaker Change: and it is he who extended the ITCs and the PTCs at that time. So we are still confident in the American market, generally. On the development side, maybe I will let Patrick answer that question.
and Bruno Guilmette.
I think that in the United States, we must...
Speaker Change: to differentiate the noise from the signal. The signal is that there is...
the electricity needs are very important.
Speaker Change: At Renewables, we are able to develop and deploy projects. So, I think we need to...
Speaker Change: and we will take care of the situation and if there are any changes.
I don't think that...
I wasn't expecting that.
Speaker Change: The IRA will be completely changed. I remind you that at the end of this first term, Trump expanded the ITC and PTC mechanism, and this was driven by the development of renewable energy in the United States, so it's a fact. And we will see, I think there is also...
Speaker Change: or sites in operation, as we have done in France in the past. I think we have different opportunities on this site as well.
Speaker Change: To conclude on the development projects, do you have equipment for Save Harbor to obtain the credits?
on the projects you are following.
Speaker Change: We worked very closely with the additional devices before being in New York.
Speaker Change: and we were very cautious about this point when we voted.
Speaker Change: We will see when the result arrives, how we will trigger this commitment with the suppliers and see how we can work. The important thing is that...
Speaker Change: the domestic content of the project and we are, I think, on the safe side of this project, in orbit.
OK.
Speaker Change: With the results of the French tender that have been released, there was a media article talking about a number of German developers who are winners and more active in this tournament. Does that surprise you? What do you see in terms of competition? And who follows the projects through the competitive tender? Does this support you more in the corporate PPA market?
Speaker Change: I have known a German developer in France for about 23 years.
Speaker Change: And just for the story, when I was alone, there was already a great...
Speaker Change: and other companies from Germany, like WSB, VSB Today, Planbeck, EnergiKontor or other German developers. In the end, we are bigger than them in France. We will continue to work. And yes, we have the option to...
and we get caught.
Speaker Change: of the company, the RFP of the EDF, and to incorporate the PPA and try to play on the different options we previously had in France. The main point in France...
and we see that the price of the tensioner is not...
Speaker Change: The competition is not on the price, the competition is on the acquisition.
Speaker Change: to be able to sell them. That's why we have been competing with German developers for 20 years.
Speaker Change: The last question for me is that in the United Kingdom, I believe they said they would allow the postponement of investments for the next elections. Do you think this dynamic change is part of how you think about your positioning on your project pipeline, expecting to invest in the next elections?
Will the onshore... [inaudible]
Wind, be in the same...
Speaker Change: the subsidy basket, then the solar project, like in the AR6? It's a big question, Marc, because they did it.
Speaker Change: according to the latest trend, which was not the case in the past. So, they did something specific.
The wind industry...
Speaker Change: by saying that if you want to have wind projects, specifically in the north, and not just solar projects in England, you should do something specific, because the nominal price will always be different. So that's one thing. The other question is, what would the budget be?
Do you remember that...
Speaker Change: When the government arrived at the office, they changed the AR6 budget from a certain amount to 50% more very quickly, but they didn't change anything else in the framework. We know there is time before the AR7 to see some changes, and I think that's also something important. So, yes, the report will be there.
Speaker Change: It could be a great opportunity and the two other factors will have to be taken into account to evaluate the competitiveness of the next tender.
Understood. Thank you Bruno. Thank you Patrick. Thank you Marc.
Speaker Change: There are no further questions on this subject, so I will hand it over to you. Thank you.
Speaker Change #100: Thank you all for your attention and your good questions. If you have additional questions, call me. The number is the same as usual, 514-213-1045. I will ensure that we respond to your questions promptly. Our next conference call to announce the results of the fourth quarter will be on February 28.
Speaker Change #100: 2025 at the same time, at 11:00 AM. Have a good day everyone.
Bye. Thank you. Thank you.
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Speaker Change #101: This concludes today's conference call. Thank you all for participating. You may now disconnect your lines. Thank you.