Greencoat Renewables - Interim Results to 30 June 2022
12/09/2022 07:00
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RNS Number : 0185Z Greencoat Renewables PLC 12 September 2022
Greencoat Renewables 2022 Interim Results
Dublin, London | 12 September 2022: Greencoat Renewables PLC ("Greencoat
Renewables" or the "Company"), the renewable infrastructure company invested
in euro-denominated assets, today announces its results for the six months
ended 30 June 2022.
Highlights - Continued Investment across Geographies and Technologies
· The Group's investments generated 1,127GWh of electricity (H1 2021:
745GWh) in the period.
· Net cash generation of €92.1 million (H1 2021: €40.2million),
delivering gross dividend cover of 3.0x (H1 2021 1.8x).
· Total installed capacity increased to 1,028MW (H1 2021: 686MW) in the
period, as a result of an increase in portfolio size to 28 wind farms (H1
2021: 23) and the Killala battery project becoming operational.
· GAV increased to €2,155 million (H1 2021: €1,442 million) and NAV
increased to €1,256 million (H1 2021: €749 million).
· Delivered continued geographic diversity with acquisitions across
Germany and Spain as well as continued investments in Ireland.
· Declared total dividends of 3.09 cent per share with respect to the
period.
· Successful capital raising activity in the period with gross proceeds
of €281.5 million raised in an oversubscribed placing.
· €898.7 million Aggregate Group Debt, equivalent to 42% of GAV.
Commenting on the results, Ronan Murphy, Non-Executive Chairman of Greencoat
Renewables, said:
"The six months to 30 June 2022 was another active period for the Company, as
we added 217MW of new generating assets to the portfolio, taking our total
installed capacity above the 1GW threshold. We achieved a further milestone
with the acquisition of our first offshore wind asset in Germany and
strengthened our European diversification with agreements to acquire new
assets in Spain, Sweden and France.
Over the past 12 months we have committed €867 million into renewable
generation assets, with elevated power prices supporting increased levels of
reinvestment.
With Europe expected to require €1 trillion of new clean energy investment
by 2040, the Company is well positioned to play a significant role in enabling
and accelerating this transition, directly contributing to meeting emissions
targets and reducing reliance on gas across Europe."
Key Metrics
As at 30 June 2022
Market capitalisation €1,346.7 million
Share price 118.0 cent
Dividends with respect to the period €35.3 million
Dividends with respect to the period per share 3.09 cent
GAV €2,154.8 million
NAV €1,256.1 million
NAV per share 110.1 cent
Premium to NAV 7.2%
CO(2) emissions reduced per annum 677,000 tonnes
Homes powered per annum 485,800 homes
Funds committed in community funds and social projects > €1 million
Conference call for analysts and investors
A conference call and webcast for analysts and investors will be held at
10.00am BST today, 12 September 2022. To register please contact FTI
Consulting by email at Greencoat@fticonsulting.com.
Presentation materials are available on the Company's
website: www.greencoat-renewables.com (http://www.greencoat-renewables.com/)
--- ENDS ---
For further information on the Announcement, please
contact:
Greencoat Renewables PLC:
+44 20 7832 9400
Bertrand Gautier
Paul O'Donnell
Tom Rayner
Davy (Joint Broker, Nomad and
Euronext Growth Listing
Sponsor)
+353 1 6796363
Ronan Veale
Barry Murphy
RBC (Joint Broker)
+44 20 7653 4000
Matthew Coakes
Duncan Smith
Elizabeth Evans
FTI Consulting (Media
Enquiries)
greencoat@fticonsulting.com
Melanie
Farrell
+353 86 401 5250
Orla Cox
About Greencoat Renewables PLC
Greencoat Renewables PLC is an investor in
euro-denominated renewable energy infrastructure assets. Initially focused
solely on the acquisition and management of operating wind farms in Ireland,
the Company is now also investing in wind and solar assets in certain other
European countries with stable and robust renewable energy frameworks. It is
managed by Greencoat Capital LLP, an experienced investment manager in the
listed renewable energy infrastructure sector.
Greencoat Renewables PLC
Interim Report
For the six months ended 30
June 2022
At a Glance
Summary
Greencoat Renewables PLC is a sector-focused listed renewable infrastructure
company, investing in renewable electricity generation assets. The Company's
aim is to provide investors with an annual dividend that increases
progressively whilst growing the capital value of its investment portfolio in
the long term through reinvestment of excess cash flow and the prudent use of
portfolio leverage.
Highlights
· The Group generated 1,127GWh of electricity, which was 4% behind
budget, predominantly due to constraints and curtailments in Ireland.
· Net cash generation (Group and wind farm SPVs) was €92.1 million
(gross of SPV level debt repayment).
· Acquisition of three wind farms, across multiple geographies: Borkum
Riffgrund 1 in Germany, Soliedra in Spain and Tullahennel in Ireland, along
with the forward sale acquisition of Erstrask North in Sweden.
· Increased portfolio to 28 wind farms, and a co-located battery project
at Killala, bringing total installed capacity to 1,028MW and GAV to €2,155
million.
· The Company has declared total dividends of 3.09 cent per share with
respect to the period.
· €898.7 million Aggregate Group Debt, equivalent to 42% of GAV.
Key Metrics
As at
30 June 2022
Market capitalisation €1,346.7 million
Share price 118.0 cent
Dividends with respect to the period €35.3 million
Dividends with respect to the period per share 3.09 cent
GAV €2,154.8 million
NAV €1,256.1 million
NAV per share 110.1 cent
Premium to NAV 7.2%
CO(2) emissions reduced per annum 677,000 tonnes
Homes powered per annum 485,800 homes
Funds committed in community funds and social projects > €1 million
Chairman's Statement
I am pleased to present Greencoat Renewables PLC's interim results for the six
months ended 30 June 2022. It was a successful period in which the Company
continued to build one of Europe's leading renewable infrastructure
businesses. Our strategic progress was allied to a strong performance from our
existing portfolio, delivering stable returns to our shareholders.
The period saw 217MW of new generating assets added to the Company's
portfolio, taking our total installed capacity above the 1GW threshold. The
Company achieved a significant milestone with the acquisition of our first
offshore wind asset in Germany and further strengthened our European
diversification with a commitment to acquire new assets in Spain, Sweden and
France.
We are proud that the business contributes directly to a more sustainable
economy, with the current portfolio generating enough clean electricity to
eliminate 677,000 tonnes of CO(2) emissions from thermal generation.
Beyond electricity, we are focused on operating responsibly across the ESG
spectrum and I am pleased with our progress and wider impact. We continue to
work towards best-practice disclosure and the business is now reporting in
line with TCFD recommendations, SFDR Article 9, and is 100% aligned to the EU
Taxonomy for Climate Change Mitigation.
In April, the Company raised €281.5 million at an issue price of €1.12 per
share in an oversubscribed placing, and I thank shareholders for their
continued support. Our equity issuance strategy enables us to maintain
sufficient agility to take advantage of current and future acquisition
opportunities, while maintaining our gearing position within the Company's
Investment Policy.
In summary, it has been a successful first half of the year in a period which
saw considerable disruption to energy markets and indeed to economies and
lives across the Continent. The importance of the transition to clean energy
and securing energy independence is clearer than ever. With the EU expecting a
requirement for up to €1 trillion in new investment by 2040, the Company is
set to play a significant role in enabling and accelerating this transition.
Performance
The portfolio generated 1,127GWh in the period, up from 745GWh for the
corresponding period last year.
Wind resource over the period was above forecast, while generation over the
period was less than 4% below budget, predominately due to constraints and
curtailments in Ireland.
As the portfolio has grown into new geographies, the business has benefitted
from increased diversification both in terms of weather systems and power
markets. Low correlation of wind speeds between Continental Europe and Ireland
ensures stability of cashflows in periods of lower regional wind resource.
Net cash generation in the period was €92.1 million, delivering a gross
dividend cover of 3.0x. In line with the Company's strategy, cash has been
used to pay down debt and reinvest in the portfolio.
The past two years have emphasised the potential volatility in power prices
and the corresponding importance of a prudent approach to forward price curves
and contracting. The Investment Manager's in-house expertise in structuring
and delivering both corporate and utility PPA's is an increasingly valuable
tool for managing this power price risk. We now have merchant assets in Spain,
Sweden, and Ireland, providing opportunities for a pan-European approach to
providing renewable PPA's to corporate customers where required.
The Group's optimisation strategy continued with increased revenues from
system services, alongside performance enhancement measures implemented across
the portfolio.
Following the successful commissioning of our first co-located battery project
at Killala wind farm in Ireland, we continue to assess opportunities to
enhance the existing portfolio and to optimise investments with co-located
facilities to maximise value.
Dividend and Returns
We are pleased to announce an increase in the Company's annual dividend for
2022 in line with the existing policy. The targeted annual dividend is now
6.18 cent per share, up from 6.06 cent per share in 2021, an increase of 2%.
The Company paid a quarterly dividend of 1.515 cents per share with respect to
Q4, 2021 on 25 February 2022, a second and third dividend of 1.545 cents per
share on 1 June and 26 August 2022, with a future dividend payment scheduled
for November 2022.
NAV per share increased in the period from 105.1 cent per share on 31 December
2021 to 110.1 cent per share on 30 June 2022. This increase is attributable to
higher power prices in the near term and adjustments to short term inflation
assumptions in Ireland and Continental Europe.
Acquisitions & Diversification
The Company's plans for growth and diversification continued successfully with
value accretive opportunities emerging across Continental Europe and
consolidation of our leading position in Ireland. In aggregate, the Company
committed or deployed over €712 million in the first six months of the year.
A number of these transactions were in off-market, bilateral processes.
The past 12 months has seen 281MW of net capacity added outside of Ireland,
and 50MW of net capacity within Ireland, reflective of the scale of
opportunities we are seeing in Continental Europe.
In light of the increasing scope in the acquisition pipeline across
Continental Europe, the Board is considering a change to the Investment Policy
regarding the 40% limit on non-Ireland investments, in order to support the
Company's continued diversification in Europe, providing access to a wider set
of opportunities.
In total, three new assets were acquired in the first half of 2022:
Germany - A 50% stake in the 312MW offshore wind farm Borkum Riffgrund 1,
alongside Ørsted, benefitting from a government-backed floor price until
2035.
Ireland - Tullahennel wind farm, a 37.1MW onshore wind farm which benefits
from a long-term government-backed guaranteed floor price.
Spain - Soliedra wind farm, a 24MW onshore wind farm currently uncontracted
with flexibility in the future to contract via a corporate PPA.
In addition, the Group entered into a forward sale agreement to acquire
Erstrask North, a 134.4MW onshore wind farm located in Sweden.
The expansion into the Nordics last year and into Spain and Germany this year
is indicative of the Company's intentions, seeing opportunities to aggregate
significant investments in diversified geographies, as we have demonstrated in
Ireland.
The Company continues to explore new European markets where we can see low
Levelized Cost of Electricity ("LCOE") opportunities in both wind and solar,
with underlying Euro denominated cashflows. This includes opportunities in the
Baltics and Italy.
As at 30 June 2022, the Group's portfolio comprised 28 operational wind farms
and a co-located battery project, with an aggregate net capacity of 1,027.6MW,
with a further 356.1MW contracted to acquire.
Gearing
During the period, the Group entered into a new €275 million 5-year term
debt facility to support value accretive acquisitions. This new term debt is
complementary to the existing term debt facilities with bullet payments due
between 2025 and 2028. More details are contained in the Interim Report.
The Revolving Credit Facility ("RCF") was utilised early in the year to
support acquisition activity and was repaid following the equity raise in
early April in line with the Company's investment model. As at 30 June 2022,
the RCF remains undrawn, with €300 million available.
A significant portion of the excess cash generated was used to directly
acquire new assets for the portfolio, including Soliedra and more recently
acquisitions in Q3, 2022, including a 67.7MW portfolio comprised of four wind
farms in France from Axpo and the expected forward-sale acquisition of
Kokkoneva, a 43.2MW wind farm in Finland, following successful commissioning.
Total Group debt, including the Company and SPV's, as at 30 June 2022 amounted
to €898.7 million, which is 42% of GAV. While interest rates are rising, it
is important to note that the Group has entered into long term interest rate
hedges to minimise this risk. The Group continues its prudent use of low-cost
debt (limited to 60% of GAV) which has further enhanced the Group's cash
yield, while maintaining gearing levels well within the guidelines detailed in
the Company's Investment Policy.
Principal Risks and Uncertainties
As detailed in the Company's Annual Report for the year ended 31 December
2021, the principal risks and uncertainties affecting the Company are
generally unchanged and include:
§ Dependence on the Investment Manager;
§ Regulatory risks;
§ Financing risks; and
§ Risks of investment returns becoming unattractive.
Further, as detailed in the Company's Annual Report for the year to 31
December 2021, the principal risks and uncertainties affecting the investee
companies are summarised as follows:
§ Electricity prices (volatility in the market price of electricity);
§ Dispatch down (reduction of output due to grid constraints and
curtailments);
§ Regulation (changes in government policy or laws on renewable energy);
§ Wind resource (short term volatility);
§ Asset life (lower than expected life of the wind farm);
§ Market structure (risk of market structure change); and
§ Health and Safety and the Environment.
The principal risks outlined above remain the most likely to affect the
Company and its investee companies in the second half of the year.
Environmental, Social and Governance
Central to the Company's strategy is growing a successful business that
supports the transition to a net-zero carbon economy, in a way that positively
impacts the communities and local environment in which we operate. With a
continued focus on the challenges associated with climate change, the Company
is also mindful of the current energy security risk and the role the Company
has in mitigating this across Europe.
During 2022, the Company has made strong progress on key ESG areas including;
§ The completion of the first phase of physical risk modelling in line with
TCFD recommendations;
§ The commencement of the first modern slavery audits of material service
providers;
§ The completion of the first wind turbine recyclability study for the
Company;
§ The completion of the CDP submission for the reporting year of 2021; and
§ The integration of the Company's ESG strategy across new geographies and
technologies.
In addition, the Company's activities are aligned to the EU Taxonomy for
Climate Change Mitigation and is reporting in line with the requirements for
SFDR Article 9. The continued evolution of the Company's ESG strategy and its
successful implementation will ensure the long-term success of the Company and
protect the interests of shareholders and all stakeholders.
Board Composition and Governance
The Board places significant emphasis on reviewing its composition and skills;
and ensuring that the Board's diversity - including gender, background,
expertise and ethnicity, among other considerations - meets the needs of the
business; matches the expectations of stakeholders; and brings fresh thinking
to Board deliberations.
The Board has been engaged in a process to identify an additional candidate to
appoint as a non-executive Director over the past year, with the support of an
independent executive search agency. The Board was pleased to appoint Eva
Lindqvist as an independent Director on 7 July 2022.
Eva is an experienced company Chair and Non-Executive Director with
international experience in telecoms and infrastructure, having worked for
more than 30 years across these sectors. She brings valuable senior experience
to the Board and her appointment will also raise female representation on the
Board to 40%, an important metric for the Company.
The Board notes that the re-appointment of Marco Graziano, Chairman of the
Nominations Committee, as a non-executive director at the 2022 AGM was opposed
by c.21% of shareholders. Following a consultation process held with
shareholders, feedback indicated that opposition to Marco's reappointment was
driven by the lack of gender diversity of the Board with only a 25% female
representation at the time of the AGM. Since the summer of 2021, the Board was
engaged in a process to appoint an additional Director to the Board and
following the appointment of Eva Lindqvist as outlined, the increased female
representation on the Board has addressed the issue raised by shareholders,
aligns with market best-practice and meets the target for gender diversity set
by the Board.
Outlook
The outlook for the Company remains strong, with a considerable pipeline of
attractive assets in Continental Europe, and the opportunity for further
consolidation of the Irish market.
Over the past six months, the Company has invested and committed €712
million into renewable generation assets across four countries. The Investment
Manager's position as a long-standing strategic partner of developers and
utilities creates co-investment opportunities which further enhance the
ability of the business to identify and execute value accretive transactions.
The Company is clearly benefiting from having access to the widest opportunity
set, enabled by our scale and geographic reach, with our core focus remaining
the acquisition of contracted wind and solar assets. Whilst Ireland remains a
core market, we expect future acquisitions to be weighted towards Europe as
the Company continues to diversify. In particular, we expect to see continued
growth in our offshore portfolio where we see significant value and potential
for acquisitions.
Investment Management Agreement
We are pleased to announce that the Board has agreed a new five-year agreement
with the Investment Manager. This process was commenced early in the year and
was supported by the Company's brokers, RBC and J&E Davy, who provided
benchmarking and independent recommendations that were reviewed and challenged
by the Board. The new contract was agreed on beneficial terms to the Company,
with an additional tier added to the cash fee structure, which will see a
reduction in the fee charged in respect of NAV over €1,750 million,
reflecting continued economies of scale as the business grows.
Annual General Meeting
The AGM took place on Friday 29 April 2022, with all resolutions passed
without amendment.
Conclusion
In conclusion, the Board and I are very pleased with the overall performance
of the Company in the six-month period and, in addition, we are excited about
the future direction as the Company continues to expand its geographical
diversity and technology mix.
Rónán Murphy
Chairman
11 September 2022.
Investment Manager's Report
Information about Investment Manager
Greencoat Capital LLP, the Investment Manager, is responsible for the
day-to-day management of the Group's investment portfolio in accordance with
the Company's investment objective and policy, subject to the overall
supervision of the Board.
The Investment Manager is an experienced manager of renewable infrastructure
assets with over €10 billion of assets under management. Following the
recent investment by Schroders plc, the Investment Manager continues to
operate in an independent capacity, and has a dedicated, unchanged team
managing the Group, led by Bertrand Gautier and Paul O'Donnell.
The Investment Manager is authorised and regulated by the Financial Conduct
Authority and is a full scope UK AIFM.
Portfolio Performance
Portfolio generation for the six months ended 30 June 2022 was 1,127GWh, 3.7%
below budget. Wind resource was slightly above budget in our operating
geographies, however, forced grid outages, constraints, and curtailments in
Ireland were above expectations due to a continued backlog in the grid's
delivery of upgrade projects. The Investment Manager is actively engaged with
the regulator and wider industry to ensure full implementation of the EU Clean
Energy Package.
Power Prices
Electricity demand and prices continued to increase over the period as Europe
experienced a shortage of gas supply as well as the ongoing economic recovery
from the pandemic. Independent power price forecasts continue to view this as
a short-to-medium-term spike, with expectations of a reversion to pre-pandemic
levels in 12-24 months.
The Group operates a highly contracted portfolio, which we continue to view as
the most prudent long-term approach. In the nearer term, the Group continues
to benefit from merchant exposure in Sweden and Spain, along with certain
assets in Ireland being exposed to higher power prices via the REFIT
mechanism.
Inflation
Approximately 70% of portfolio cashflows are underpinned by government support
mechanisms with underlying contracted tariffs that are inflation-linked to
2032. The past year saw significant rises in inflation across Europe, and we
are currently forecasting 2022 inflation to be 6.0% in Ireland and a similar
level in the rest of Europe. We remain pleased to have a portfolio of assets
with such high levels of inherent protection.
Portfolio Management
The Group continues to actively manage its portfolio in concert with its
O&M partners. As one of the largest operators of renewable assets in
Europe, the Investment Manager is able to leverage its scale and experience to
identify opportunities to optimise the portfolio. The Group's size also
enables it to achieve economies of scale in contractual arrangements with its
O&M partners.
Notable achievements include:
Performance improvement
§ Killala turbine smart yaw upgrade providing a 0.6% energy yield
improvement;
§ Power upgrade on two sites, Knockacummer and Glencarbry, providing a c. 1%
energy yield improvement;
§ Signed new HV maintenance contracts at a portfolio level to improve overall
service and reduce costs; and
§ Increased participation in DS3 ancillary grid services.
Active PPA strategy
§ Implemented a new trading strategy at Knockacummer and Ballybane from 1
January 2022, which optimised constraint payments to yield additional revenue
streams;
§ Actively tendering a number of renewable assets for long term PPAs, where
the original support regimes are ending in 2023 and 2024.
Co-located battery project at Killala wind farm
The Killala Battery facility was fully operational in time for the DS3
contract start date of 1 April 2022, six months ahead of project schedule and
within budget. The project is retendering for additional DS3 services in the
current gate. Capacity market revenue will commence in Q4 2022, following the
unit's success in the T-1 2022/2023 auction.
Health and safety
Health and safety are of paramount importance for both the Group and the
Investment Manager. The Investment Manager reviews, on a monthly basis,
comprehensive reports provided by operational site managers, which are also
reviewed by Directors at Board meetings. In the period there have been in
excess of 110 audits and site inspections across the portfolio carried out by
our operations managers to ensure best practice is maintained.
The Investment Manager is pleased to report that there were no major incidents
in the period ended 30 June 2022, with plans in place to ensure all sites
receive an annual inspection by the Investment Manager during 2022.
Acquisitions
During the six-month period ending 30 June 2022, the Group completed three
material acquisitions as noted below:
§ The 312MW Borkum Riffgrund 1 offshore wind farm, located in the North Sea,
part of Germany's exclusive economic zone. The wind farm was developed and
constructed by Ørsted, who remains a 50% shareholder and will continue to
provide operation, maintenance and management services under a long-term
contract. The wind farm benefits from a fixed-price CfD until September 2024.
After this period, the project benefits from a government-backed floor price
until May 2035. This provides exposure to power price upside, as well as the
emerging European corporate PPA market opportunity.
§ The 24MW Soliedra wind farm located in Soria, in the region of Castilla y
Leon, Spain. The Soliedra wind farm is currently contracted as a merchant
asset, however, has flexibility in the future to be contracted via a corporate
PPA.
§ The 37MW Tullahennel wind farm, located in County Kerry, Ireland with
revenues contracted under the REFIT 2 scheme, providing a long-term guaranteed
minimum floor price for the electricity generated until December 2032.
In addition to the above, the Group entered into an agreement in May 2022 to
acquire a 67.7MW portfolio of operating wind farms in France which all benefit
from French government long-term fixed-price contracts. The acquisition
comprises 4 wind farms:
§ The 16MW Arcy-Précy windfarm located in the Burgundy region of France with
a government-backed, fixed-price contract until August 2041;
§ The 9.4MW Butte de Menonville windfarm located in the Centre Val-de-Loire
region of France with a government-backed, fixed-price contract until June
2041;
§ The 21.6MW Genonville windfarm located in the Centre Val-de-Loire region of
France with a government-backed, fixed-price contract until February 2042.
§ The 20.7MW Grande Pièce windfarm, located in the Centre Val-de-Loire
region of France with a government-backed, fixed-price contracted until August
2032.
The transaction which completed on 6 September 2022 is the Group's second
portfolio acquisition in France.
Forward sale commitments
During the period, the Group entered into a forward sale commitment to acquire
Erstrask North, a 134.4MW wind farm located in Norrbotten County, Sweden. This
is the Group's second acquisition in this location, having acquired Erstrask
South wind farm in October 2021. The wind farm construction is being financed
and managed by Enercon, who will provide long term operations and maintenance
services once fully commissioned in Q4 2023.
Other existing forward sale commitments include:
§ Kokkoneva 43.2MW wind farm, located in Northern Ostrobothnia, Finland,
expected to reach commercial operations in Q3, 2022;
§ Torrubia, 50MW solar farm, located in La Muela, Spain. The deal represents
the Group's first solar transaction and is expected to reach commercial
operations in Q4, 2022;
§ Taghart 25.2MW wind farm, located in County Cavan, Ireland, expected to
reach commercial operations in Q4, 2022; and
§ Cloghan 37.8MW wind farm, located in County Offaly, Ireland, expected to
reach commercial operation in Q1, 2023.
In addition to the above commitments, post period end the Group recently
committed to acquire South Meath, an 80.5MW solar farm located in County
Meath, Ireland. This is the Group's first co-investment, with the remaining
50% being acquired in partnership with a pension fund, investing through a
fund also managed by the Investment Manager. Statkraft will finance and manage
the construction of the solar farm and will continue to provide management
services once operational, with commencement of commercial operations expected
in Q4 2023.
These projects, all under construction, are proceeding as planned, with no
material issues effecting the planned completion timetable.
Financial Performance
Dividend cover for the six months ended 30 June 2022 was 2.7x net and 3.0x
gross of project level debt repayment. Cash balances, which include the Group
and the SPV wind farms, was €264.1 million at 30 June 2022.
Group and wind farm SPV cash flows For the six months ended
30 June 2022
Net ((1)) Gross ((1))
€ 000 € 000
Net cash generation 85,504 92,057
Dividends paid (31,114) (31,114)
SPV Capex & PSO Cashflow ((2)) 8,295 8,295
SPV level debt repayment - (6,553)
Acquisitions ((3)) (422,034) (422,034)
Acquisition costs (2,046) (2,046)
Equity issuance 281,514 281,514
Equity issuance costs (4,451) (4,451)
Net drawdown under debt facilities 275,000 275,000
Upfront finance costs (74) (74)
Movement in cash (Group and wind farm SPVs) 190,594 190,594
Opening cash balance (Group and wind farm SPVs) 73,464 73,464
Ending cash balance (Group and wind farm SPVs) 264,058 264,058
Net cash generation ((1)) 85,504 92,057
Dividends 31,114 31,114
Dividend cover 2.7x 3.0x
((1) ) The dividend cover table shows two scenarios: the first reflects
cash generation net of the Group's share of project level debt repayment
(€6,553k) and the second is the net cash generation gross of SPV level debt
repayments. The following wind farms contain project level debt: Cloosh
Valley, Raheenleagh, Sliabh Bawn and Pasilly.
((2) ) Cashflows reflect residual capital expenditure from acquired SPVs,
being (€1.8 million), plus REFIT PSO working capital movements of €10.1
million relating to wind farm SPV's.
((3) ) Acquisition consideration is net of the acquired SPV cash of €17
million.
The following two tables provide further detail in relation to net generation
figures of €92.1 million (gross) and €85.5 million (net).
Net Cash Generation - Breakdown For the six months ended
30 June 2022
Net Gross
€'000 €'000
Revenue 143,435 143,435
Operating expenses (33,017) (33,017)
Tax / VAT (1,848) (1,848)
Wind farm operating cashflow 108,570 108,570
SPV level debt interest (2,774) (2,774)
SPV level debt repayment (6,553) -
Wind farm cashflow 99,243 105,796
Management fee (4,614) (4,614)
Operating expenses (2,034) (2,034)
Ongoing finance costs (7,124) (7,124)
VAT 33 33
Group cashflow (13,739) (13,739)
Net cash generation 85,504 92,057
For the six months ended
30 June 2022
Net Cash Generation - Reconciliation to Net Cash Flows from Operating
Activities
Net Gross
€'000 €'000
Net cash flows from operating activities ((1)) 49,318 49,318
Movement in cash balances of wind farm SPVs ((2)) 46,541 46,541
SPV capex and PSO cashflow ((3)) (10,834) (10,834)
Cash used by the Company for SPV Bonds (35,370) (35,370)
Repayment of debt at SPV level ((2)) - 6,553
Repayment of shareholder loan investment ((1)) 41,858 41,858
Finance costs ((1)) (8,833) (8,833)
Upfront finance costs (cash) ((4)) 2,824 2,824
Net cash generation 85,504 92,057
(1) Condensed Consolidated Statement of Cash Flows.
(2) Note 8 to the Financial Statements, excludes acquired
cash.
(3) Cashflows reflect REFIT working capital movements
including the PSO relating to wind farm SPVs, being €12 million less
residual capital expenditure from acquired SPVs of €1 million.
(4) €2,824k includes €2,750k Facility C arrangement
fees plus €74k professional fees (as per note 12 to the Financial
Statements).
During the period, the 5.0 cent per share NAV increase is attributable to:
§ Cash generated over the period (minus dividend paid) of +6.3 cent;
§ Portfolio depreciation of -3.3 cent;
§ Impact of short-term CPI increase of +3.2 cent; and
§ Others (mostly mid to long-term power price forecast and increased business
rates) -1.2 cent.
The Group also acquired three wind farms for a total of €454 million. The
investments were financed by a mix of group debt, proceeds from the equity
raise in April 2022, and organic cash generation.
Dividends totalling €31.1 million were paid in the period on 25 February and
9 June 2022.
The share price at 30 June 2022 was 118.0 cents, representing a 7.2% premium
to NAV.
Cent per share
NAV at 31 December 2021 105.1
Less February 2022 dividend (1.5)
NAV at 31 December 2021 (ex-dividend) 103.6
NAV at 30 June 2022 110.1
Less August 2022 dividend (1.5)
NAV at 30 June 2022 (ex-dividend) 108.6
Movement in NAV (ex-dividend) 5.0
Reconciliation of Statutory Net Assets to Reported NAV
As at As at
30 June 2022
31 December 2021
€'000 €'000
DCF valuation 1,892,237 1,470,117
Other relevant assets (wind farm SPVs) 2,169 20,397
Cash (wind farm SPVs) 131,744 68,419
Fair value of investments ((1)) 2,026,150 1,558,933
Cash (Group) 132,315 5,045
Other relevant (liabilities)/assets ((2)) (3,645) 2,302
GAV 2,154,820 1,566,280
Aggregate Group Debt ((3)) (898,696) (631,080)
NAV 1,256,124 935,200
Reconciling items - -
Statutory net assets 1,256,124 935,200
Shares in issue 1,141,238,938 889,887,587
NAV per share (cent) 110.1 105.1
(1) The fair value of investments are shown gross of €149 million debt
and swap values held at wind farm SPV level that are not included in the
equivalent figure in the consolidated Statement of Financial Position.
(2) Other relevant assets at 30 June 2022 include €2.2 million of
capitalised facility arrangement fees that are netted off against loans and
borrowings (consistent with Note 12) to the financial statements.
(3) Aggregate Group debt includes €149 million debt and swaps held at
wind farm SPV level, plus three tranches of term debt being €275 million
Facility A term debt, €200 million 7-year term debt and €275 million
Facility C.
Gearing
As at 30 June 2022, the aggregate Group debt was €898.7 million, which
equates to 42% of GAV. This comprises €750.0 million drawn under the Group's
term debt facilities, plus the Group's proportionate share of asset level,
long-term project finance debt of €149 million.
The Group's RCF at 30 June 2022 remains undrawn, with €300 million available
to fund future investments. The group will continue to optimise the capital
structure and take advantage of favourable debt market conditions.
Equity Issuance
In April 2022, the Company issued 251,351,351 new shares at an issue price of
112 cent per share raising gross proceeds of €281.5 million in an
oversubscribed and NAV-accretive share placing. Net proceeds from the equity
raise were used to repay the Group's drawn RCF and to fund future acquisitions
in line with the Company's strategy.
Environmental, Social and Governance
The Group continues to make progress in 2022 on its ESG ambitions, as outlined
in its ESG policy. The following summarises our ESG accomplishments in 2022:
§ Completion of the first phase of physical risk modelling in line with TCFD
recommendations and SFDR;
§ Completion of the CDP submission for the reporting year of 2021;
§ Commencement of the first Modern Slavery audits on material service
providers;
§ Completion of the Company's first study on wind turbine recyclability; and
§ Continuation of engagement with material service providers on recyclability
and emissions.
The continued evolution of our ESG strategy and its successful implementation
will ensure the long-term success of our business and protect the interests of
shareholders and all stakeholders.
Further details of the Group's ESG initiatives, including its SFDR Disclosure
Statement, can be found in the latest ESG report, available on the Company's
website www.greencoat-renewables.com (http://www.greencoat-renewables.com)
Outlook
In summary, we are pleased to report another successful period for the
Company, as a result of a strong operational performance, inherent inflation
protection, and exposure to current power prices.
The outlook for the Group remains positive with an excellent pipeline in the
medium term, combined with significant long-term growth in European
renewables.
Driven by the transition to Net Zero and recent energy security concerns, we
have seen a strong commitment to renewable deployment, and increased or
accelerated targets for renewable capacity across our target European
geographies.
Accordingly, the Group has high confidence in its European growth strategy,
and sees excellent opportunities for continued diversification across
geographies, technologies, and pricing structures. In particular, we believe
the Group to be well-placed to take advantage of a growing opportunity to
invest in European offshore wind, benefitting from the experience and existing
relationships of the Investment Manager.
Given the accelerating opportunity in Continental Europe, we plan to consult
shareholders on a change to the current 40% limit on investments outside of
Ireland, to ensure that the Group is well placed to deliver on our growth
potential with the full range of opportunities available in the market.
Statement of Directors' Responsibilities
The Directors acknowledge responsibility for the interim results and approve
this Half Year Report. The Directors confirm that to the best of their
knowledge:
a) the condensed financial statements have been prepared in accordance with
IAS 34 "Interim Financial Reporting" and give a true and fair view of the
assets, liabilities and financial position and the profit of the Group as
required by DTR 4.2.4R;
b) the interim management report, included within the Chairman's Statement and
Investment Manager's Report, includes a fair review of the information
required by DTR 4.2.7R, being the significant events of the first half of the
year and the principal risks and uncertainties for the remaining six months of
the year; and
c) the condensed financial statements include a fair review of the related
party transactions, as required by DTR 4.2.8R.
The Responsibility Statement has been approved by the Board.
Rónán Murphy
Chairman
11 September 2022.
Condensed Consolidated Statement of Comprehensive Income (unaudited)
For the six months ended 30 June 2022
Note For the six months ended For the six months ended
30 June 2022 30 June 2021
€'000 €'000
Return on investments 3 91,182 32,991
Other income 13 -
Total income and gains 91,195 32,991
Operating expenses 4 (7,807) (4,605)
Investment acquisition costs (3,419) (2,309)
Operating profit 79,969 26,077
Finance expense 12 (4,926) (3,362)
Profit for the period before tax 75,043 22,715
Taxation 5 - -
Profit for the period after tax 75,043 22,715
Profit and total comprehensive income attributable to:
Equity holders of the Company 75,043 22,715
Earnings per share
Basic and diluted earnings from continuing operations during the period (cent) 6 7.42 3.06
The accompanying notes form an integral part of the condensed consolidated
interim financial statements.
Condensed Consolidated Statement of Financial Position (unaudited)
As at 30 June 2022
Note 30 June 2022 31 December 2021
€'000 €'000
Non current assets
Investments at fair value through profit or loss 8 1,877,453
1,408,802
1,877,453 1,408,802
Current assets
Receivables 10 386 359
Cash and cash equivalents 132,315 5,045
132,701 5,404
Current liabilities
Payables 11 (8,664) (6,297)
Net current assets/(liabilities) 124,037 (893)
Non current liabilities
Loans and borrowings 12 (745,366) (472,709)
Net assets 1,256,124 935,200
Capital and reserves
Called up share capital 14 11,413 8,898
Share premium account 14 942,885 668,405
Other distributable reserves 83,483 114,597
Retained earnings 218,343 143,300
Total shareholders' funds 1,256,124 935,200
Net assets per share (cent) 15 110.1 105.1
Authorised for issue by the Board on 11 September 2022 and signed on its
behalf by:
Rónán
Murphy
Kevin McNamara
Chairman
Director
The accompanying notes form an integral part of the condensed consolidated
interim financial statements.
Condensed Consolidated Statement of Changes in Equity (unaudited)
For the six months ended 30 June 2022
Note Share capital €'000 Share premium €'000 Other distributable Retained earnings €'000 Total
For the six months reserves €'000
ended 30 June 2022 €'000
Opening net assets attributable to shareholders (1 January 2022) 8,898 668,405 114,597 143,300 935,200
Issue of share capital 2,515 278,999 - - 281,514
Share issue costs - (4,519) - - (4,519)
Interim dividends paid in the period 7 - - (31,114) - (31,114)
Profit and total comprehensive income for the period - - - 75,043 75,043
Closing net assets attributable to shareholders 11,413 942,885 83,483 218,343 1,256,124
After taking account of cumulative unrealised gains in fair value of
investments of €167,181,313, the total reserves distributable by way of a
dividend as at 30 June 2022 were €134,645,847.
For the six months ended 30 June 2021
Note Share capital €'000 Share premium €'000 Other distributable Retained earnings €'000 Total
For the six months reserves €'000
ended 30 June 2021 €'000
Opening net assets attributable to shareholders (1 January 2021) 7,412 507,476 161,768 72,157 748,813
Share issue costs - 44 - - 44
Interim dividends paid in the period 7 - - (22,460) - (22,460)
Profit and total comprehensive income for the period - - - 22,715 22,715
Closing net assets attributable to shareholders 7,412 507,520 139,308 94,872 749,112
After taking account of cumulative unrealised gains in fair value of
investments of €91,075,313 the total reserves distributable by way of a
dividend as at 30 June 2021 were €143,104,623.
The accompanying notes form an integral part of the condensed consolidated
interim financial statements.
Condensed Consolidated Statement of Cash Flows (unaudited)
For the six months ended 30 June 2022
Note For the six months ended 30 June 2022 For the six months ended 30 June 2021
€'000 €'000
Net cash flows from operating activities 16 49,318 5,631
Cash flows from investing activities
Acquisition of investments 8 (474,099) (296,672)
Investment acquisition costs (1,855) (2,590)
Repayment of shareholder loan investments 8 41,858 31,097
Net cash flows from investing activities (434,096) (268,165)
Cash flows from financing activities
Issue of share capital 281,514 -
Payment of issue costs (4,519) (103)
Dividends paid 7 (31,114) (22,460)
Amounts drawn down on loan facilities 12 370,660 360,000
Amounts repaid on loan facilities 12 (95,660) (85,000)
Finance costs (8,833) (1,682)
Net cash flows from financing activities 512,048 250,755
Net (decrease)/increase in cash and cash equivalents during the period 127,270 (11,779)
Cash and cash equivalents at the beginning of the period 5,045 16,517
Cash and cash equivalents at the end of the period 132,315 4,738
The accompanying notes form an integral part of the condensed consolidated
interim financial statements.
Notes to the Unaudited Condensed Consolidated Financial Statements
For the six months ended 30 June 2022
1. Significant accounting policies
Basis of accounting
The condensed consolidated financial statements included in this Half Year
Report have been prepared in accordance with IAS 34 "Interim Financial
Reporting". The same accounting policies, presentation and methods of
computation are followed in these condensed consolidated financial statements
as were applied in the preparation of the Group's consolidated annual
financial statements for the year ended 31 December 2021 and are expected to
continue to apply in the Group's consolidated financial statements for the
year ended 31 December 2022.
The Group's consolidated annual financial statements were prepared on the
historic cost basis, as modified for the measurement of certain financial
instruments at fair value through profit or loss and in accordance with IFRS
to the extent that they have been adopted by the EU and with those parts of
the Companies Act 2014 (including amendments by the Companies (Accounting) Act
2017) applicable to companies reporting under IFRS.
These condensed consolidated financial statements are presented in Euro
("€") which is the currency of the primary economic environment in which the
Group operates and are rounded to the nearest thousand, unless otherwise
stated.
These condensed financial statements do not include all information and
disclosures required in the annual financial statements and should be read in
conjunction with the Group's consolidated annual financial statements as of
31 December 2021. The audited annual accounts for the year ended 31 December
2021 have been delivered to the Companies Registration Office. The audit
report thereon was unmodified.
Review
The Interim Report has not been audited or formally reviewed by the Company's
Auditor in accordance with the International Standards on Auditing (ISAs)
(Ireland) or International Standards on Review Engagements (ISREs).
Going concern
As at 30 June 2022, the Group had net assets of €1,256 million (31 December
2021: €935.2 million) and cash balances of €132.3 million (31 December
2021: €5.0 million) which are sufficient to meet current obligations as they
fall due.
The COVID-19 pandemic has had a negative impact on the global economy. The
Directors and Investment Manager are actively monitoring this and its
potential effect on the Group and its SPVs. In particular, they have
considered the following specific key potential impacts:
§ Unavailability of key personnel at the Investment Manager or Administrator;
§ Increased volatility in the fair value of investments;
§ Disruptions to maintenance or repair at the investee company level; and
§ Allowance for expected counterparty credit losses.
In considering the above key potential impacts of COVID-19 on the Group and
SPV operations, the Directors have assessed these with reference to the
mitigation measures in place and do not consider that the effects have created
a material uncertainty over the assessment of the Group as a going concern.
The Directors have reviewed Group forecasts and projections which cover a
period of at least 12 months from the date of approval of this report, taking
into account foreseeable changes in investment and trading performance, which
show that the Group has sufficient financial resources to continue in
operation for at least the next 12 months from the date of approval of this
report.
On the basis of this review, and after making due enquiries, the Directors
have a reasonable expectation that the Company and the Group have adequate
resources to continue in operational existence for at least up to September
2023. Accordingly, they continue to adopt the going concern basis in preparing
the financial statements.
Segmental reporting
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision-maker. The chief operating
decision-maker, who is responsible for allocating resources and assessing
performance of the operating segments, has been identified as the Board of
Directors, as a whole.
The key measure of performance used by the Board to assess the Group's
performance and to allocate resources is the total return on the Group's net
assets, as calculated under IFRS, and therefore no reconciliation is required
between the measure of profit or loss used by the Board and that contained in
the condensed consolidated financial statements.
For management purposes, the Group is organised into one main operating
segment, which currently invests in wind farm assets.
The Group is engaged in a single segment of business, being investment in
renewable infrastructure to generate investment returns while preserving
capital. The Group presents the business as a single segment comprising a
homogeneous portfolio.
All of the Group's income is generated within Ireland and Continental Europe.
All of the Group's non-current assets are also located in Ireland and
Continental Europe.
Seasonal and cyclical variations
The Group's results do not vary significantly during reporting periods as a
result of seasonal activity.
2. Investment management fees
Under the terms of the Investment Management Agreement, the Investment Manager
is entitled to a management fee from the Company, which is calculated
quarterly in arrears and remains at 0.25% of NAV per quarter on that part of
NAV up to and including €1 billion, 0.2% of NAV per quarter on that part of
NAV from €1 billion to €1.75 billion and 0.1875% of NAV per quarter on
that part of NAV over €1.75 billion.
During the period the Investment Management Agreement was extended for a
further five-year term, commencing on 25 July 2022.
Investment management fees paid or accrued in the period were as follows:
For the six For the six
months ended months ended
30 June 2022 30 June 2021
€'000 €'000
Investment management fees 5,732 3,691
5,732 3,691
As at 30 June 2022, €3,070,207 was payable in relation to investment
management fees (31 December 2021: €2,155,526).
3. Return on investments
For the six For the six
months ended months ended
30 June 2022
30 June 2021
€'000 €'000
Dividends received (note 17) 45,300 1,498
Unrealised movement in fair value of investments (note 8) 33,922 25,776
Interest on shareholder loan investment 11,960 5,717
91,182 32,991
*
4. Operating expenses
For the six For the six
months ended months ended
30 June 2022
30 June 2021
€'000 €'000
Investment management fees (note 2) 5,732 3,691
Other expenses 1,705 589
Group and SPV administration fees 152 126
Non-executive Directors' remuneration 170 159
Fees to the Company's Auditor:
for audit of the statutory financial statements 45 37
for other services 3 3
7,807 4,605
The fees to the Company's Auditor include €3,150 (2021: €3,000) payable in
relation to a limited review of these interim financial statements, and
estimated accruals apportioned across the year for the audit of the statutory
financial statements.
5. Taxation
Taxable income during the period was offset by management expenses and the tax
charge for the period ended 30 June 2022 is €nil (30 June 2021: €nil). The
Group is not expected to have tax losses carried forward to offset against
current and future profits as at 30 June 2022 (30 June 2021: €nil).
6. Earnings per share
For the six For the six
months ended months ended
30 June 2022
30 June 2021
Profit attributable to equity holders of the Company - €'000 75,043 22,715
Weighted average number of ordinary shares in issue 1,010,702,877 741,238,938
Basic and diluted earnings from continuing operations in the period (cent) 7.42 3.06
7. Dividends declared with respect to the period
Interim dividends paid during the period ended 30 June 2022 Dividend per Total
Share cent Dividend
With respect to the quarter ended 31 December 2021 1.5150 13,482
With respect to the quarter ended 31 March 2022 1.5450 17,632
3.0600 31,114
Interim dividends declared after 30 June 2022 and not accrued in the period Dividend per Total
Share cent Dividend
With respect to the quarter ended 30 June 2022 1.5450 17,632
1.5450 17,632
As disclosed in note 18, the Board approved a dividend of 1.5450 cent per
share on 27 July 2022 in relation to the quarter ended 30 June 2022, bringing
total dividends declared with respect to the period to 3.09 cent per share.
The record date for the dividend was 05 August 2022 and the payment date was
26 August 2022.
8. Investments at fair value through profit or loss
For the period ended 30 June 2022 Loans Equity interest Total
€'000 €'000 €'000
Opening balance 1 January 2022 779,865 628,937 1,408,802
Additions 395,418 78,679 474,097
Repayment of shareholder loan investments (41,858) - (41,858)
Shareholder loan adjustments 2,097 - 2,097
Unrealised movement in fair value of investments (note 3) 393 33,922 34,315
Closing balance 30 June 2022 1,135,915 741,538 1,877,453
For the period ended 30 June 2021 Loans Equity interest Total
€'000 €'000 €'000
Opening balance 1 January 2021 505,552 438,800 944,352
Additions 256,189 40,483 296,672
Repayment of shareholder loan investments (31,097) - (31,097)
Unrealised movement in fair value of investments (note 3) 1,741 24,035 25,776
Closing balance 30 June 2021 732,385 503,318 1,235,703
The unrealised movement in fair value of investments of the Group during the
period was made up as follows:
For the six For the six
months ended months ended
30 June 2022 30 June 2021
€'000 €'000
Decrease in valuation of investments (27,003) (18,457)
Movement in swap fair values at SPV level 826 1,025
Repayment of debt at SPV level 6,553 8,316
Cash used by the Company for SPV Bonds (35,370) -
Repayment of shareholder loan investments (note 17) 41,858 31,097
Movement in cash balances of SPVs 46,541 1,205
Shareholder loan balance adjustment (2,097) -
Investment acquisition costs 3,007 2,590
34,315 25,776
Fair value measurements
As disclosed in the Company's Annual Report for the year ended 31 December
2021, IFRS 13 "Fair Value Measurement" requires disclosure of fair value
measurement by level. The level of fair value hierarchy within the financial
assets or financial liabilities ranges from level 1 to level 3 and is
determined on the basis of the lowest level input that is significant to the
fair value measurement.
The fair value of the Group's investments is ultimately determined by the
underlying fair values of the SPV investments. Due to their nature, they are
always expected to be classified as level 3, as the investments are not traded
and contain unobservable inputs. There have been no transfers between levels
during the six months ended 30 June 2022. All other financial instruments are
classified as level 2.
Sensitivity analysis
The fair value of the Group's investments is €1,877,453,243 (31 December
2021: €1,408,802,257). The following analysis is provided to illustrate the
sensitivity of the fair value of investments to a change in an individual
input, while all other variables remain constant. The Board considers these
changes in inputs to be within reasonable expected ranges. This is not
intended to imply the likelihood of change or that possible changes in value
would be restricted to this range.
Input Base case Change in input Change in fair value of investments Change in NAV per share
€'000 cent
Discount rate 6 - 7% + 0.25% (33,090) (2.9)
- 0.25% 34,165 3.0
Energy yield P50 10-year P90 (118,993) (10.4)
10-year P10 118,284 10.4
Power price Forecast by leading consultant - 10% (121,282) (10.6)
+ 10% 119,395 10.5
Inflation rate 2.0% - 0.5% (66,904) (5.9)
+ 0.5% 71,064 6.2
Asset Life 30 years - 5 years (149,089) (13.1)
+ 5 years 104,600 9.2
The sensitivities above are assumed to be independent of each other. Combined
sensitivities are not presented.
9. Unconsolidated subsidiaries, associates and joint ventures
The following table shows subsidiaries of the Group acquired during the
period. As the Company is regarded as an investment entity under IFRS, these
subsidiaries have not been consolidated in the preparation of the financial
statements:
Investment Place of Business Ownership Interest as at
30 June 2022
Registered Office
Tullahennel Ireland Riverside One, Sir John 100%
Rogerson's Quay, Dublin 2
Soliedra Spain Paseo Castellana 9, 28046 Madrid 100%
Borkum Riffgrund 1 Germany Van-der-Smissen-Straße 9 50%
22767 Hamburg
Boston Holding A/S* Denmark Koldingvej 2, 7190 Billund 100%
*Boston Holding A/S is the holding company of Borkum Riffgrund oHG.
There are no other changes to unconsolidated subsidiaries of the Group and
there are no other changes to associates and joint venture of the group as
disclosed in the Company's Annual Report for the year ended 31 December 2021.
There have been no changes to security deposits or guarantees as disclosed in
the Company's Annual Report for the year ended 31 December 2021.
10. Receivables
30 June 2022 31 December 2021
€'000 €'000
Sundry receivables 6 157
VAT receivable 48 118
Prepayments 79 46
Accrued income 209 20
Withholding tax receivable 44 18
386 359
11. Payables
30 June 2022 31 December 2021
€'000 €'000
Investment management fees payable 3,070 2,156
Other payables 2,258 1,739
Acquisition costs payable 2,142 1,327
Loan interest payable 798 781
Commitment fee payable 328 257
Share issue costs payable 68 37
8,664 6,297
12. Loans and borrowings
30 June 2022 31 December 2021
€'000 €'000
Opening balance 472,709 210,808
Revolving Credit Facility
Drawdowns 95,660 379,780
Repayments (95,660) (394,780)
Amortisation - 2,173
Term debt facilities
Drawdowns 275,000 275,000
Finance costs capitalised (2,829) (816)
Amortisation 486 544
Closing balance 745,366 472,709
Non current liabilities 745,366 472,709
For the six For the six
months ended
30 June 2022 months ended
30 June 2021
€'000 €'000
Loan interest 3,495 1,820
Professional fees 22 441
Commitment fees 923 382
Facility arrangement fees 486 719
Finance expense 4,926 3,362
As at 30 June 2022, the principal balance of the RCF was €nil (31 December
2021: €Nil) accrued interest was €nil (31 December 2021: €Nil) and the
outstanding commitment fee was €328,258 (31 December 2021: €256,719).
Details of the Group's term debt facilities under Facility A and associated
interest rate swaps are set out in the below table:
Facility A
Provider
CBA 7 October 2025 1.55 (0.399) 75,000 204
ING 7 October 2025 1.55 (0.300) 75,000 221
NAB 7 October 2025 1.55 (0.399) 75,000 204
NatWest 7 October 2025 1.55 (0.396) 50,000 136
275,000 765
These loans contain swaps that are contractually linked. Accordingly, they
have been treated as single fixed rate loan agreements, which effectively set
interest payable at fixed rates.
In April 2022, the Group entered into a new 5-year term debt arrangements with
the existing tern debt lenders, being, CBA, ING, NAB and NatWest.
Details of the Group's term debt facilities under Facility C and associated
interest rate swaps are set out in the below table:
Facility C
Provider
CBA 28 March 2027 1.45 2.0620 75,000 9
ING 28 March 2027 1.45 2.0587 75,000 9
NAB 28 March 2027 1.45 2.0570 75,000 9
NatWest 28 March 2027 1.45 2.0770 50,000 6
275,000 33
These loans contain swaps that are contractually linked. Accordingly, they
have been treated as single fixed rate loan agreements, which effectively set
interest payable at fixed rates.
In 2021, the Group entered into a 7-year term debt arrangement with AXA. This
fixed rate non-amortising term debt of €200 million was utilised in three
tranches. Details are set out in the below table:
Provider Maturity date Loan Mid swap Loan Accrued interest at 30 June 2022
margin rate principal
% % €'000 €'000
AXA September 2028 1.85 (0.141) 150,000 -
AXA September 2028 1.85 (0.045) 50,000 -
200,000 -
All borrowing ranks pari passu with a debenture over the assets of Holdco 1
and Holdco 2 and a floating charge over Holdco 1 and Holdco 2's bank accounts.
13. Contingencies & Commitments
At the time of acquisition, wind farms which had less than 12 months'
operational data may have a wind energy true-up applied, whereby the purchase
price for these wind farms may be adjusted so that it is typically based on a
2-year operational record, once operational data has become available.
The following wind energy true-ups remain outstanding and the maximum
adjustments are as follows: Letteragh: €2,500,000.
In December 2020, the Group entered into an agreement to acquire the Taghart
and Cloghan wind farms for a headline consideration of €123 million. The
investment is scheduled to complete in Q4, 2022 and Q1, 2023 respectively,
once the wind farms are fully operational.
In February 2021, the Group entered into an agreement to acquire the Kokkoneva
wind farm for headline consideration of €60 million. The investment is
scheduled to complete in Q4, 2022 once the wind farm is fully operational.
In December 2021, the Group entered into an agreement to acquire Torrubia, a
50MW solar farm currently under construction in La Muela, Spain. The
investment is scheduled to complete in Q4, 2022 once the solar farm is fully
operational.
In April 2022, the Group entered into an agreement to acquire Erstrask North,
a 134MW wind farm currently under construction in Sweden. The investment is
scheduled to complete in Q4, 2023 once the wind farm is fully operational.
On 24 May 2022 the Group entered into an agreement to acquire a 67.7MW
portfolio of operating wind farms in France, being:
§ The 16MW Arcy-Précy windfarm located in the Burgundy region of France -
government-backed, fixed-price contract until August 2041;
§ The 9.4MW Butte de Menonville windfarm located in the Centre Val-de-Loire
region of France - government-backed, fixed-price contract until June 2041;
§ The 21.6MW Genonville windfarm located in the Centre Val-de-Loire region of
France - government-backed, fixed-price contract until February 2042.
§ The 20.7MW Grande Pièce windfarm, located in the Centre Val-de-Loire
region of France - government-backed, fixed-price contracted until August
2032.
14. Share capital - ordinary shares
At 30 June 2022, the Company had issued share capital of 1,141,238,938
ordinary shares of €0.01 each.
Date Issued and fully paid Number of shares issued Share capital Share premium Total
€'000 €'000 €'000
1 January 2022 Opening balance 889,887,587 8,898 668,405 677,303
5 April 2022 Issued and paid 251,351,351 2,515 278,999 281,514
5 April 2022 Issues costs paid - - (4,519) (4,519)
30 June 2022 1,141,238,938 11,413 942,885 954,298
Shareholders are entitled to all dividends paid by the Company and, on a
winding up, provided the Company has satisfied all of its liabilities, the
Shareholders are entitled to all of the residual assets of the Company.
15. Net assets per share
30 June 2022 31 December 2021
Net assets - €'000 1,256,124 935,200
Number of ordinary shares issued 1,141,238,938 889,887,587
Total net assets - cent 110.1 105.1
16. Reconciliation of operating profit for the period to net cash from
operating activities
For the six months ended For the six months ended
30 June 2022
30 June 2021
€'000 €'000
Operating profit for the period 79,969 26,077
Adjustments for:
Unrealised movement in fair value of investments (note 8) (34,315) (25,776)
Investment acquisition costs 3,419 2,309
Finance costs capitalised (2,829) (862)
Amortisation of finance costs 486 825
(Increase)/decrease in receivables (27) 3,756
(Decrease)/increase in payables 2,615 (698)
Net cash flows from operating activities 49,318 5,631
17. Related party transactions
During the period, Holdco made repayments of €8,000,000 (30 June 2021:
€17,200,000). During the period, the Company also received shareholder loan
repayments from Knockacummer of €6,850,400 (30 June 2021: €4,155,069) and
Killhills of €7,251,217 (30 June 2021: €1,100,000).
In April 2022, Rónán Murphy subscribed to 17,500 shares and Marco Graziano
25,000 shares in the Company at an issue price of 112 cent per share.
The below table shows the Group's dividend income:
For the six months ending 30 June 2022 For the six months ending 30 June 2021
Dividend Income Dividend Income
€000 €000
Ballybane 2,800 -
Raheenleagh 1,000 500
Lisdowney 800 -
Knocknalour 500 248
Knockacummer 22,600 -
Killhills 1,300 -
Glanaruddery 4,400 -
Gortahile 1,250 750
Letteragh 600 -
Garranereagh 850 -
Cordal 7,300 -
Beam Hill 1,900 -
45,300 1,498
The table below shows the Group's shareholder loans with the wind farm
investments.
Loans at 1 January 2022((1)) Loan balance adjusted in the period Loans advanced in the period Loan Repayments Loans balance Accrued interest Total Interest on shareholder loan in the period
at 30 June 2022 at 30 June 2022
€'000 €'000 €'000 €'000 €'000 €'000 €'000 €'000
Cordal 168,499 - - (18,499) 150,000 821 150,821 1,663
Glencarbry 71,263 - - (4,263) 67,000 353 67,353 708
Monaincha 63,474 863 - - 64,336 325 64,662 647
Glanaruddery 46,333 - - - 46,333 234 46,568 466
Knockacummer 46,229 2,713 - (6,850) 42,092 787 42,879 1,565
Erstrask South 44,334 - - - 44,334 448 44,782 892
Sommette 40,206 - - - 40,206 601 40,807 1,196
Ballybane 35,808 - - - 35,808 181 35,989 360
Killala 32,069 (3,263) 700 (1,400) 28,106 492 28,598 534
GRP Sweden 25,223 - - - 25,223 709 25,932 507
Letteragh 25,200 - - 25,200 207 25,407 412
Killhills 21,471 (663) - (7,251) 13,556 67 13,624 134
Cnoc 16,247 - - (2,247) 14,000 78 14,078 159
Saint Martin 15,819 (321) - - 15,498 232 15,730 461
Gortahile 15,640 - - - 15,640 79 15,719 157
Kostroma 14,481 646 - - 15,127 257 15,383 152
Tullynamoyle II 13,861 - - - 13,861 70 13,931 139
Garranereagh 13,233 (863) - - 12,370 63 12,433 124
Carrickallen 12,998 - - - 12,998 394 13,392 261
Lisdowney 9,603 - - - 9,603 72 9,675 143
Pasilly 8,720 - - - 8,720 259 8,979 259
Beam Hill Extension 8,640 - - - 8,640 44 8,683 87
Ballincollig Hill 7,824 - - - 7,824 83 7,907 79
Knocknalour 5,795 - - - 5,795 48 5,842 95
Sliabh Bawn 5,052 2,985 - - 8,037 - 8,037 -
Cloosh Valley 4,574 - - - 4,574 - 4,574 -
Borkum Riffgrund 1 - - 275,346 - 275,346 59 275,405 59
Tullahennel - - 58,162 - 58,162 413 58,575 413
Boston Holding A/S - - 31,890 - 31,890 - 31,890 -
Soliedra - - 29,322 (1,347) 27,974 286 28,260 286
772,596 2,097 395,418 (41,858) 1,128,253 7,662 1,135,915 11,960
(1)€772,595k excluded accrued interest at 31 December 2021 of €7,269k.
*The balance of accrued interest at 30 June 2022 is €7,662k, with movement
in the period being €393k.
18. Subsequent events
On 18 July 2022 the Group entered into an acquisition agreement to acquire the
80.5MW South Meath Solar Farm from Statkraft. The Group will acquire a 50%
stake in the asset with the remaining 50% being acquired in partnership with a
pension fund, investing through a fund also managed by Greencoat Capital LLP,
the Group's Investment Manager. The asset is currently under construction in
County Meath, Ireland, with commencement of commercial operations expected in
Q4 2023. The transaction is structured under a forward sale model and will
only complete once the solar farm is fully operational.
On 28 July 2022, the Board approved a dividend of €17.6 million, equivalent
to 1.545 cent per share in relation to the quarter ended 30 June 2022. The
record date for the dividend was 5 August 2022 and the payment date was 26
August 2022.
On 6 September 2022 the Group completed the acquisition of the 67.7MW
portfolio of operating wind farms in France, being:
§ The 16MW Arcy-Précy windfarm located in the Burgundy region of France -
government-backed, fixed-price contract until August 2041;
§ The 9.4MW Butte de Menonville windfarm located in the Centre Val-de-Loire
region of France - government-backed, fixed-price contract until June 2041;
§ The 21.6MW Genonville windfarm located in the Centre Val-de-Loire region of
France - government-backed, fixed-price contract until February 2042.
§ The 20.7MW Grande Pièce windfarm, located in the Centre Val-de-Loire
region of France - government-backed, fixed-price contracted until August
2032.
19. Board approval
The Group's Interim Report and Financial Statements were approved by the Board
of Directors on 11 September 2022.
Company Information
Registered Company Number
Directors (all non-executive)
Rónán Murphy 598470
Emer Gilvarry
Kevin McNamara Registered Office
Marco Graziano Riverside One
Eva Lindqvist (appointed 7 July 2022) Sir John Rogerson's Quay
Dublin 2
Investment Manager
Greencoat Capital LLP Registered Auditor
4(th) Floor, The Peak BDO
5 Wilton Road Beaux Lane House
London SW1V 1AN Mercer Street Lower
Dublin 2
Company Secretary
Ocorian Administration (UK) Limited Legal Advisers
Unit 18 Innovation Centre McCann Fitzgerald
Northern Ireland Science Park Riverside One
Queens Road Sir John Rogerson's Quay
Belfast BT3 9DT Dublin 2
Administrator Joint Broker, NOMAD and
Euronext Growth Listing Sponsor
Northern Trust International Fund J&E Davy
Administration Services (Ireland) Limited Davy House
54-62 Townsend Street, Dublin 2 49 Dawson Street
Dublin 2
Depositary
Northern Trust International Fiduciary Joint Broker
Services (Ireland) Limited RBC Capital Markets
Georges Court 100 Bishopsgate
54-62 Townsend Street London, EC2N 4AA
Dublin 2
Account Banks
Registrar Allied Irish Banks plc.
Computershare Investor Services 40/41 Westmoreland Street
(Ireland) Limited Dublin 2
3100 Lake Drive
Citywest Business Campus Northern Trust International Fiduciary
Dublin 24 Services (Ireland) Limited
Georges Court
56-62 Townsend Street
Dublin 2
Defined Terms
Admission Document means the Admission Document of the Company published on 31
December 2019
Aggregate Group Debt means the Group's proportionate share of outstanding
third-party debt.
AIB means Allied Irish Bank plc
AIC means the Association of Investment Companies
AIC Code of Corporate Governance sets out a framework of best practice in
respect of the governance of investment companies. It has been endorsed by the
Financial Reporting Council as an alternative means for our members to meet
their obligations in relation to the UK Corporate Governance Code
AIC Guide means the AIC's Corporate Governance Guide for Investment Companies
AIF means Alternative Investment Funds (as defined in AIFMD)
AIFM means Alternative Investment Fund Manager (as defined in AIFMD)
AIFMD means Alternative Investment Fund Managers Directive
AGM means Annual General Meeting of the Company
AXA means funds managed by AXA Investment Managers UK Limited
Ballincollig Hill means Tra Investments Limited
Ballybane means Ballybane Windfarms Limited
BDO means the Company's Auditor as at the reporting date
Beam means Beam Hill and Beam Hill Extension
Beam Hill means Beam Wind Limited
Beam Hill Extension means Meenaward Wind Farm Limited
Board means the Directors of the Company
Borkum Riffgrund 1 means Borkum Riffgrund oHG
Boston Holding means Boston Holding A/S
Brexit means the withdrawal of the United Kingdom from the European Union
Carrickallen means Carrickallen Wind Limited
CBA means Commonwealth Bank of Australia#
CBI means the Central Bank of Ireland
CDP means Carbon Disclosure Project
CFD means Contract for Difference
CIBC means Canadian Imperial Bank of Commerce
Cloosh Valley means Cloosh Valley Wind Farm Holdings DAC and Cloosh Valley
Wind Farm DAC
Cnoc means Cnoc Windfarms Limited
Company means Greencoat Renewables PLC
Cordal means Cordal Windfarm Holdings Limited, Oak Energy Supply Limited and
Cordal Windfarms Limited
CPI means Consumer Price Index
DCF means Discounted Cash Flow
DS3 means Delivering a Secure, Sustainable Electricity System
EGM means Extraordinary General Meeting of the Company
Erstrask South means Erstrask Vind South AB
ESG means the Environmental, Social and Governance
EU means the European Union
Euronext means the Euronext Dublin, formerly the Irish Stock Exchange
EURIBOR means the Euro Interbank Offered Rate
Eurozone means the area comprising 19 of the 28 Member States which have
adopted the euro as their common currency and sole legal tender
FCA means Financial Conduct Authority
FIT means Feed-In Tariff
FRC means Financial Reporting Council
GAV means Gross Asset Value as defined in the Admission Document
Garranereagh means Sigatoka Limited
Glanaruddery means Glanaruddery Windfarms Limited and Glanaruddery Energy
Supply Limited
Glencarbry means Glencarbry Windfarm Limited
Gortahile means Gortahile Windfarm Limited
Group means the Company, Holdco, Holdco 1 and Holdco 2
GRP Sweden means GRP Sweden Holding AB
Holdco means GR Wind Farms 1 Limited
Holdco 1 means Greencoat Renewables 1 Holdings Limited
Holdco 2 means Greencoat Renewables 2 Holdings Limited
Holdcos mean GR Wind Farms 1 Limited, Greencoat Renewables 1 Holdings Limited
and Greencoat Renewables 2 Holdings Limited
IAS means International Accounting Standards
IFRS means International Financial Reporting Standards
ING means ING Bank N.V.
Investment Management Agreement means the agreement between the Company and
the Investment Manager
Investment Manager means Greencoat Capital LLP
IPEV means the International Private Equity and Venture Capital Valuation
Guidelines
IPO means Initial Public Offering
Irish Corporate Governance Annex is a corporate governance annex addressed to
companies with a primary equity listing on the Main Securities Market of
Euronext
IRR means internal rate of return
I-SEM means the Integrated Single Electricity Market, which is the wholesale
electricity market arrangement for Ireland and Northern Ireland
Killala means Killala Community Wind Farm DAC
Killhills means Killhills Windfarm Limited
Knockacummer means Knockacummer Wind Farm Limited
Knocknalour means Knocknalour Wind Farm Holdings Limited and Knocknalour Wind
Farm Limited
Kostroma Holdings means Kostroma Holdings Limited
Letteragh means Seahound Wind Developments Limited
Lisdowney means Lisdowney Wind Farm Limited
Monaincha means Monaincha Wind Farm Limited
NAB means National Australia Bank
NatWest means National Westminster Bank
NAV means Net Asset Value as defined in the Admission Document
NAV per Share means the Net Asset Value per Ordinary Share
NOMAD means a company that has been approved as a nominated advisor for the
Alternative Investment Market (AIM), by Euronext Dublin and London Stock
Exchange
O&M means operations and maintenance
Pasilly means Société d'Exploitation du Parc Eolien du Tonnerois
PPA means Power Purchase Agreement entered into by the Group's wind farms
PSO means Public Support Obligation
Raheenleagh means Raheenleagh Power DAC
RBC means Royal Bank of Canada
RCF means the Group's Revolving Credit Facility
REFIT means Renewable Energy Feed-In Tariff
RESS means Renewable Energy Support Scheme
Saint Martin means Parc Eolien Des Courtibeaux SAS
Santander means Abbey National Treasury Services Plc (trading as Santander
Global Corporate Banking)
SEM means the Single Electricity Market, which is the wholesale electricity
market operating in the Republic of Ireland and Northern Ireland
SFDR means Sustainable Finance Disclosure Regulation
Sliabh Bawn means Sliabh Bawn Holding DAC, Sliabh Bawn Supply DAC and Sliabh
Bawn Power DAC
SMSF means SMSF Holdings Limited
Solar PV means a solar photovoltaic system, which is a power system designed
to supply usable solar power by means of photovoltaics.
Soliedra means Parque Eolico Soliedra
Sommette means Parc Eolien Des Tournevents SAS
South Meath means SMSF Holdings Limited
SPVs means the Special Purpose Vehicles, which hold the Group's investment
portfolio of underlying operating wind farms
TCFD means Task Force on Climate-Related Financial Disclosures
TSR means Total Shareholder Return
Tullahennel means Ronaver Energy Limited
Tullynamoyle II means Tullynamoyle Wind Farm II Limited
UK means United Kingdom of Great Britain and Northern Ireland
UK Code means UK Corporate Governance Code issued by the FRC.
Alternative Performance Measures
Performance Measure Definition
CO(2) emissions avoided per annum The estimate of the portfolio's annual CO(2) emissions avoided through the
displacement of thermal generation, based on the portfolio's estimated
generation as at the relevant reporting date.
Homes powered per annum The estimate of the number of homes powered by electricity generated by the
portfolio, based on the portfolio's estimated generation as at the relevant
reporting date.
Generation The amount of energy generated by the underlying SPV's (investments) in the
portfolio over the period.
NAV movement per share (adjusting for dividends) Movement in the ex-dividend Net Asset Value per ordinary share during the
year.
NAV per share The Net Asset Value per ordinary share.
Net cash generation The operating cash flow of the Group and wind farm SPVs.
Premium to NAV The percentage difference between the published NAV per ordinary share and the
quoted price of each ordinary share as at the relevant reporting date.
Total return (NAV) The movement in the ex-dividend NAV per ordinary share, plus dividend per
ordinary share declared or paid to shareholders with respect to the year.
Total Shareholder Return The movement in share price, combined with dividends paid during the year, on
the assumption that these dividends have been reinvested.
Forward Looking Statements and other Important Information
This document may include statements that are, or may be deemed to be,
"forward-looking statements". These forward-looking statements can be
identified by the use of forward-looking terminology, including the terms
"believes", "estimates", "anticipates", "expects", "intends", "may", "plans",
"projects", "will", "explore" or "should" or, in each case, their negative or
other variations or comparable terminology or by discussions of strategy,
plans, objectives, goals, future events or intentions.
These forward-looking statements include all matters that are not historical
facts. They may appear in a number of places throughout this document and may
include, but are not limited to, statements regarding the intentions, beliefs
or current expectations of the Company, the Directors and/or the Investment
Manager concerning, amongst other things, the investment objectives and
investment policy, financing strategies, investment performance, results of
operations, financial condition, liquidity, prospects, and distribution policy
of the Company and the markets in which it invests.
By their nature, forward-looking statements involve risks and uncertainties
because they relate to future events and depend on circumstances that may or
may not occur in the future. Forward-looking statements are not guarantees of
future performance. The Company's actual investment performance, results of
operations, financial condition, liquidity, distribution policy and the
development of its financing strategies may differ materially from the
impression created by, or described in or suggested by, the forward-looking
statements contained in this document.
In addition, even if actual investment performance, results of operations,
financial condition, liquidity, distribution policy and the development of its
financing strategies, are consistent with any forward-looking statements
contained in this document, those results or developments may not be
indicative of results or developments in subsequent periods. A number of
factors could cause results and developments of the Company to differ
materially from those expressed or implied by the forward-looking statements
including, without limitation, general economic and business conditions,
global renewable energy market conditions, industry trends, competition,
changes in law or regulation, changes in taxation regimes, the availability
and cost of capital, currency fluctuations, changes in its business strategy,
political and economic uncertainty. Any forward-looking statements herein
speak only at the date of this document.
As a result, you are cautioned not to place any reliance on any such
forward-looking statements and neither the Company nor any other person
accepts responsibility for the accuracy of such statements.
Subject to their legal and regulatory obligations, the Company, the Directors
and the Investment Manager expressly disclaim any obligations to update or
revise any forward- looking statement contained herein to reflect any change
in expectations with regard thereto or any change in events, conditions or
circumstances on which any statement is based.
In addition, this document may include target figures for future financial
periods. Any such figures are targets only and are not forecasts. Nothing in
this document should be construed as a profit forecast or a profit estimate.
This Interim Report has been prepared for the Company as a whole and therefore
gives greater emphasis to those matters which are significant in respect of
Greencoat Renewables PLC and its subsidiary undertakings when viewed as a
whole.
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. END IR UAABRURUKAAR
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