Revenue and profit increased
BKW 2016 Annual results
Revenue and profit increased Investor presentation, March 16th 2017
2017 ANNUAL RESULTS | BKW | 16.03.2017
Successful 2016: Revenue and profit increased − Operating revenue increased by 8% − Continued rapid growth of services: Revenue +31%, EBIT +82% − Consecutive strong results achieved: Net profit +13% − BKW able to over-compensate negative electricity price effects
+8%
CHF m
2,862 2,645 +13%
CHF m
322 284
2015
2016 Operating revenue
2015
2016 Net profit
2
Financials FY 2016
2017 ANNUAL RESULTS | BKW | 16.03.2017
Income statement CHF m
FY 2015 reported
Operating revenue
2,645
Energy procurement/transport
-1,266
Operating costs EBITDA Depreciation, amortisation and impairment Income from associates EBIT Financial result Income taxes Net profit
One-off effects
-45
-849 530
-45
-214
FY 2015 comparable
FY 2016 reported
One-off effects
FY 2016 comparable
change comparable in %
2,645
2,862
-38
2,824
+8%
-1,311
-1,327
-1'327
-849
-953
-953
485
581
-214
-220
-220 23
-38
543
66
-28
38
23
382
-73
309
384
-38
346
-107
-0
-60
-60
-107 9
-17
-8
-62
9
-53
284
-90
194
322
-89
233
+10%
+12%
+20%
4
2017 ANNUAL RESULTS | BKW | 16.03.2017
Operating EBIT +12% CHF m
+12% 382
38
-73 10
346
other
2016 comparable
15
2015 reported
one-offs
309
-53
2015 comparable
energy
384
65
grid
services
Successful operating performance: Comparable EBIT increased by CHF 37m
one-off
2016 reported
5
2017 ANNUAL RESULTS | BKW | 16.03.2017
EBIT history (comparable) Market price of electricity
CHF m 400
300
200
324
317
346
347
60 EUR/MWh
309
239 30 EUR/MWh
100
0 2011
2012
2013
2014
EBIT-increase despite very adverse business environment
2015
2016
6
2017 ANNUAL RESULTS | BKW | 16.03.2017
Operating cost reduction in organic business CHF m
+130 -26
849 846
2015 reported
953
823
cost reduction
953
820
2016 organic
acquisitions
Significant cost savings in organic business: Over CHF 150m in last three years
2016 reported
7
2017 ANNUAL RESULTS
| BKW |
16.03.2017
Investments 2016: Successful acquisitions Investments 70% in growth
Other Energy
Services
Grid
whereof - Grid - Services - Energy (wind & small hydro)
CHF 480m
CHF 250m CHF 120m CHF 110m
Energy
CHF 690m
30% in maintenance/replacement CHF 210m
AEK Swissgrid
whereof - Grid - Energy - Other Investments partner plants
70% of investments in growth - in line with long-term capex plan
CHF 120m CHF 50m CHF 40m CHF 70m
8
2017 ANNUAL RESULTS | BKW | 16.03.2017
Funds from operations at CHF 486m CHF m 600 500
486
446
486 410
365
400 300 200 100 0 2012
2013
Consecutive strong operating cash inflow
2014
2015
2016
9
2017 ANNUAL RESULTS | BKW | 16.03.2017
Liquidity at CHF 1.2bn CHF m
Operating activities
+358
Investing activities
Financing activities
-341 -42
1394
Liquidity at strong CHF 1,2bn despite high investments
-79
-42 1248
10
2017 ANNUAL RESULTS | BKW | 16.03.2017
Sound financial situation FY 2014
CHF m 1500
1,394
797
FY 2015
FY 2016 1,248
1000 500 0 -500
-292
-470
-439
-1000 -1500 -2000
-1,734
-1,686
-1,687
Cash & equivalents & current financial assets Financial debt Net financial debt
Successful acquisitions increase net debt only slightly thanks to strong funds from operations
11
2017 ANNUAL RESULTS | BKW | 16.03.2017
Maturity profile of financing CHF bn
CHF 150m CHF 350m
CHF 130m CHF 200m EUR 40m CHF 300m EUR 85m EUR 150m
Bonds Registered bonds Convertible bond
Long-term financing framework ensures financial flexibility
12
2017 ANNUAL RESULTS | BKW | 16.03.2017
Cost study for decommissioning and disposal: Consequences CHF m
CHF m
Provisions
Estimated overnight cost +100 2,100
2,200
Assets KKM
+124 124
950 1,613
800
1,489 1,300
1,250
124
+124 124
2011
Decommissioning cost
2016
Disposal cost
Before After adjustment for cost study 2016
0
Before After adjustment for cost study 2016
Overnight cost increase due to higher risk reserves; timing effect leads to lower provisions
13
2017 ANNUAL RESULTS | BKW | 16.03.2017
Sound balance sheet: equity ratio at 34.3% 34.3%
CHF bn
32.2% 8,6 8,0 5,4
2,3
2,4
5,6
6,2
5,7
3,0 2,6
FY 2015
FY 2016
Increased equity ratio thanks to strong net profit
Non-current assets Current assets Equity Liabilities Equity ratio
14
2017 ANNUAL RESULTS | BKW | 16.03.2017
Share price development and shareholder structure CHF
+70%
52
BKW
47
Free float
37.5%
42
27.6%
37 52.5%
32
SPI
27
6.6% 3.3% 10.0%
22 17 12 30.12.2014
30.04.2015
31.08.2015
31.12.2015
30.04.2016
31.08.2016
31.12.2016
Canton of Berne Groupe E Ltd. E.ON SE (exchangeable bond) Treasury shares (convertible bond) Free float
Performance FY 2016: +30%, free float at 37.5% (incl. convertible bond BKW)
strike 32.21 EUR 38.09 CHF
15
2017 ANNUAL RESULTS | BKW | 16.03.2017
Convertible bonds BKW convertible bond (2020) Principal amount Issue price Conversion price Conversions until March 17 (nom.) Converted shares
CHF 163.4m 100 38.09 CHF 63.0 MCHF 1'638'818
CHF
CHF t
135
10000 9000
130
8000
39%
125
7000 6000
120
5000 115
4000
E.ON exchangeable bond (2018) Principal amount Underlying number of shares Conversion price Converted shares E.ON stake in BKW Feb 2017
CHF 113m 3'509'475 32.21 EUR 2'084'280
3000
110
6.65% 59% 2.7%
2000 105
1000 0
100 04.01.2016
07.03.2016
12.05.2016
15.07.2016
19.09.2016
21.11.2016
25.01.2017
BKW convertible bond Conversions
Significant conversions: 34% / 59%
16
2017 ANNUAL RESULTS | BKW | 16.03.2017
Operating revenue and EBIT per business area Operating revenue Operating profit One-off effects
CHF m 1,565
-5% +21%
1,481
925 +31%
762
565 +49%
73 189
430
38 198
-28% 136
+82%
133 17
2015
2016
2015
Energy
2016
2015
2016
2015
Grid
2016
2015
2016
Services
Strong growth of services and grid business, energy affected by negative price effects
2015
32 2016
17
2017 ANNUAL RESULTS | BKW | 16.03.2017
Energy: Considerable compensation of negative price effects CHF m 1,565
– Negative price effect on revenue: ~CHF -150m
-5%
– Partly offset on EBIT-level by
1,481
• Management of energy position • Reduction of operating cost • Cost reduction partner plants 73 189
-28% 136
FY 2015 FY 2016 Operating revenue
FY 2015 FY 2016 Operating profit
one-off effects
Negative price effects significantly compensated on EBIT level
– Volumes • Sales: increased non-regulated customers in Switzerland • Production: increased thermal, lower nuclear
18
2017 ANNUAL RESULTS | BKW | 16.03.2017
Grid: EBIT-contribution significantly increased – Increased EBIT thanks to higher regulatory asset base
CHF m +21%
– Passed on levies and charges are EBIT-neutral
925 762 +49% 38 198 133 FY 2015 FY 2016 Operating revenue
FY 2015 FY 2016 Operating profit
one-off effect
Comparable EBIT-contribution increased in line with expectations
– One-off compensation for expropriation of transmission grid (+CHF 38m) – One-time revaluation gain of CHF 11m relating to AEK acquisition
19
2017 ANNUAL RESULTS | BKW | 16.03.2017
Services: Growth leads to strong EBIT-increase CHF m
– Sales over CHF 0.5 billion, up by 31% – 18 acquisitions in 2016
+31%
– EBIT-margin 4% 6%
565 430 +82% 32 17 FY 2015 FY 2016 Operating revenue
FY 2015 FY 2016 Operating profit
Expansion on track with almost doubled EBIT and improved EBIT-margin
20
Outlook and strategy update
2017 ANNUAL RESULTS | BKW | 16.03.2017
Outlook FY 2017 Further negative impact of energy prices BKW expects to compensate these effects through – profitable growth of services business – active management of energy position – enforced cost management
BKW expects FY17 comparable operating profit to be on FY16 levels
22
2017 ANNUAL RESULTS | BKW | 16.03.2017
Shaping the future of energy – straightforward, reliable and integrated FUTURE
2014
TODAY
Reduce dependency on energy exposed to market Strengthen regulated income Keep recovery potential in energy A robust business model: Growth, risk diversification and sustainability
23
2017 ANNUAL RESULTS | BKW | 16.03.2017
Strengthen energy Invest in renewable energy production: wind and small hydro Strengthen energy trading Optimize maintenance in order to safeguard existing production portfolio Focus on operating cost Integrated approach of production, trading and sales
Reducing dependency on energy exposed to market while keeping recovery potential
24
2017 ANNUAL RESULTS | BKW | 16.03.2017
Growth of regulated energy production Investment in Europe’s largest on-shore wind farm project in Fosen (N) Acquisition of four wind farms in France BKW wind portfolio: −
Installed capacity:
440 MW
−
Under construction:
151 MW
Four small hydro power plants went on-stream in 2016 BKW small hydro portfolio: −
Installed capacity:
40 MW
−
Under construction:
10 MW
Well-balanced portfolio of regulated energy production
25
2017 ANNUAL RESULTS | BKW | 16.03.2017
Competence in energy trading Acquisition of majority stake in Wind Energy Trading (WET) Specialist in direct marketing of electricity from renewable energy sources Position management for decentralized energy production for wind farms and solar plants 3,500 MW across Germany and Austria (almost 10% of all Germany’s onshore wind farms)
BKW aligns its energy trading to changed market structures
26
2017 ANNUAL RESULTS | BKW | 16.03.2017
Develop grid Investments of around CHF 100m per year to ensure security of energy supply Increase efficiency / reduce operating cost
Profitable, optimized management of grid to ensure reliable EBIT-contribution
27
2017 ANNUAL RESULTS | BKW | 16.03.2017
Services around infrastructure
Engineering
Networks
Digital management of decentralized production
Exploit opportunities of increasingly complex energy supply system
Building technologies
28
2017 ANNUAL RESULTS | BKW | 16.03.2017
Engineering: Signigicant growth of international network - BKW's already existing engineering skills are embedded in strong engineering network with today more than 1,000 engineers - Lindschulte, IFB Eigenschenk and Assmann join BKW's engineering network - BKW now has wide-ranging expertise to provide comprehensive solutions for infrastructure, energy and environment - Considerable need to invest in improving and expanding infrastructures - Resilient business due to diversified customer segments (manufacturing, public sector) - Business with attractive margins planning/consulting
Buildup of existing skills to strong international engineering network
installation
maintenance
29
2017 ANNUAL RESULTS | BKW | 16.03.2017
Engineering: Comprehensive planning of large-scale projects Harbor site Spelle-Venhaus
Arena Regensburg
Combined engineering know-how enables BKW to develop unique large-scale projects in Europe
30
2017 ANNUAL RESULTS | BKW | 16.03.2017
Building technologies: Buildings as an intelligent, integrated energy supply system
~50% Almost half of all energy in Switzerland is consumed by buildings
increase efficiency
Synergies and new market opportunities due to increasing complexity of new technologies
31
2017 ANNUAL RESULTS | BKW | 16.03.2017
Building technologies: Fast growth throughout Switzerland − Successful growth: 7 acquisitions in 2016 − Most recent acquisition in French speaking part of Switzerland − BKW now has a network of building technology specialists throughout Switzerland −
Organization in geographical clusters
−
Each acquisition adds additional skills and build on existing expertise
−
Major potential in energy efficiency and intelligent usage
planning/consulting
installation
maintenance
Synergies and new market opportunities due to increasing complexity of new technologies
32
2017 ANNUAL RESULTS | BKW | 16.03.2017
Networks: Provider of multi-utility services − BKW provides services in areas electricity supply, transport, telecommunications and water supply − Acquired companies add expertise to existing competences − Extensive and widespread networks need considerable maintenance − Swiss market for network services > CHF 1.5bn p.a.
planning/consulting
BKW able to provide comprehensive services for complex networks
installation
maintenance
33
2017 ANNUAL RESULTS | BKW | 16.03.2017
BKW strategy shaped to create value Strengthen energy
Invest in renewable energy production Strengthen energy trading Focus on cost reduction
Develop grid
Optimize grid and grid revenues
Buildup services
Grow in focus areas - Engineering - Networks - Building technologies - Digital management of decentralized production
BKW business model geared towards growth: robust, profitable and sustainable
34
Questions?
2017 ANNUAL RESULTS | BKW | 16.03.2017
Financial calendar and contact information Financial calendar – Publication of 2017 Annual Results:
16 March 2017
– Annual General Meeting:
12 May 2017
– Ex-dividend Date:
16 May 2017
– Dividend Payment:
18 May 2017
– Publication of 2016 Half-year Results:
5 September 2017
For further information, please contact: Thomas Herren, Investor Relations Officer Tel (+41) 58 477 53 56 [email protected]
36
2017 ANNUAL RESULTS | BKW | 16.03.2017
37
Disclaimer This presentation contains forward-looking statements which are made on the basis of current expectations and assumptions. These forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements. Potential risks and uncertainties include, among others, such factors as market and economic conditions, governmental regulations, competitive conditions, interest rates and fluctuation in currency exchange rates. Although BKW believes that its expectations reflected in any such forward-looking statement are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved. BKW undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
Appendix
2017 ANNUAL RESULTS | BKW | 16.03.2017
Sales in GWh Sales in GWh
2015
2016
Sales Switzerland
6,684
7,147
Sales International
2,148
2,348
11,703
11,370
Pump energy
249
382
Transmission losses and own consumption
191
202
20,975
21,449
Trading
Total
– Delivering electricity directly and indirectly via its distribution partners to more than 1 million residents in Switzerland – Strong market position – one of the most important distributors in Switzerland – Sales international refer to sales activities in Italy
39
2017 ANNUAL RESULTS | BKW | 16.03.2017
Generation in GWh
Generation and purchases in GWh
2015
2016
Hydroelectric plants
3,983
3,614
Nuclear power plants incl. purchase contracts
5,875
5,261
Fossil-thermal power plants New renewable energy incl. fin. investments Total generation Trade (purchases) and energy buy-backs Total Total capacity MW
1,107
1,421
865
922
11'830
21,449
9,145
10,231
20,975
31,680
3,318
3,473
Capacity 2016
59%
41%
Peak load Base load
Output 2016 23% Peak load
77%
Base load
Peak load: storage, pump storage plants and CCGT Tamarete Base load: run-of-river, nuclear, other plants
40
2017 ANNUAL RESULTS | BKW | 16.03.2017
Generation overview Switzerland (Core market) Generation 2016 (incl. French purchase contracts) Installed production 31.12.2016 Under construction
Norway 9.0 TWh
112 MW
2’490 MW 10 MW
France Generation 2016
Under construction
Germany 0.1 TWh
Installed production 31.12.2016
24 MW
Under Construction
39 MW
Generation 2016
0.6 TWh
Installed production 31.12.2016
413 MW
Italy Generation 2016
1.5 TWh
Installed production 31.12.2016
546 MW
41
2017 ANNUAL RESULTS | BKW | 16.03.2017
Energy: Mühleberg nuclear power plant (KKM) −
Last day of operation: December 20, 2019
−
Cost study 2016 lead to a reduction of provisions (CHF -124m)
Financing framework for decommissioning and disposal Cost estimation excl. inflation
CHF
950m
Provisions 31.12.2016
State funds 31.12.2016
decommissioning cost
CHF 829m*
CHF 435m.
CHF 1,250m
disposal cost
CHF 661m
CHF
CHF 2,200m
estimated total cost
CHF 1,490m
CHF 1,069m
* Whereof CHF 415m directly financed (not covered by state funds)
634m
42
Revenue and profit increased Investor presentation, March 16th 2017
2017 ANNUAL RESULTS | BKW | 16.03.2017
Successful 2016: Revenue and profit increased − Operating revenue increased by 8% − Continued rapid growth of services: Revenue +31%, EBIT +82% − Consecutive strong results achieved: Net profit +13% − BKW able to over-compensate negative electricity price effects
+8%
CHF m
2,862 2,645 +13%
CHF m
322 284
2015
2016 Operating revenue
2015
2016 Net profit
2
Financials FY 2016
2017 ANNUAL RESULTS | BKW | 16.03.2017
Income statement CHF m
FY 2015 reported
Operating revenue
2,645
Energy procurement/transport
-1,266
Operating costs EBITDA Depreciation, amortisation and impairment Income from associates EBIT Financial result Income taxes Net profit
One-off effects
-45
-849 530
-45
-214
FY 2015 comparable
FY 2016 reported
One-off effects
FY 2016 comparable
change comparable in %
2,645
2,862
-38
2,824
+8%
-1,311
-1,327
-1'327
-849
-953
-953
485
581
-214
-220
-220 23
-38
543
66
-28
38
23
382
-73
309
384
-38
346
-107
-0
-60
-60
-107 9
-17
-8
-62
9
-53
284
-90
194
322
-89
233
+10%
+12%
+20%
4
2017 ANNUAL RESULTS | BKW | 16.03.2017
Operating EBIT +12% CHF m
+12% 382
38
-73 10
346
other
2016 comparable
15
2015 reported
one-offs
309
-53
2015 comparable
energy
384
65
grid
services
Successful operating performance: Comparable EBIT increased by CHF 37m
one-off
2016 reported
5
2017 ANNUAL RESULTS | BKW | 16.03.2017
EBIT history (comparable) Market price of electricity
CHF m 400
300
200
324
317
346
347
60 EUR/MWh
309
239 30 EUR/MWh
100
0 2011
2012
2013
2014
EBIT-increase despite very adverse business environment
2015
2016
6
2017 ANNUAL RESULTS | BKW | 16.03.2017
Operating cost reduction in organic business CHF m
+130 -26
849 846
2015 reported
953
823
cost reduction
953
820
2016 organic
acquisitions
Significant cost savings in organic business: Over CHF 150m in last three years
2016 reported
7
2017 ANNUAL RESULTS
| BKW |
16.03.2017
Investments 2016: Successful acquisitions Investments 70% in growth
Other Energy
Services
Grid
whereof - Grid - Services - Energy (wind & small hydro)
CHF 480m
CHF 250m CHF 120m CHF 110m
Energy
CHF 690m
30% in maintenance/replacement CHF 210m
AEK Swissgrid
whereof - Grid - Energy - Other Investments partner plants
70% of investments in growth - in line with long-term capex plan
CHF 120m CHF 50m CHF 40m CHF 70m
8
2017 ANNUAL RESULTS | BKW | 16.03.2017
Funds from operations at CHF 486m CHF m 600 500
486
446
486 410
365
400 300 200 100 0 2012
2013
Consecutive strong operating cash inflow
2014
2015
2016
9
2017 ANNUAL RESULTS | BKW | 16.03.2017
Liquidity at CHF 1.2bn CHF m
Operating activities
+358
Investing activities
Financing activities
-341 -42
1394
Liquidity at strong CHF 1,2bn despite high investments
-79
-42 1248
10
2017 ANNUAL RESULTS | BKW | 16.03.2017
Sound financial situation FY 2014
CHF m 1500
1,394
797
FY 2015
FY 2016 1,248
1000 500 0 -500
-292
-470
-439
-1000 -1500 -2000
-1,734
-1,686
-1,687
Cash & equivalents & current financial assets Financial debt Net financial debt
Successful acquisitions increase net debt only slightly thanks to strong funds from operations
11
2017 ANNUAL RESULTS | BKW | 16.03.2017
Maturity profile of financing CHF bn
CHF 150m CHF 350m
CHF 130m CHF 200m EUR 40m CHF 300m EUR 85m EUR 150m
Bonds Registered bonds Convertible bond
Long-term financing framework ensures financial flexibility
12
2017 ANNUAL RESULTS | BKW | 16.03.2017
Cost study for decommissioning and disposal: Consequences CHF m
CHF m
Provisions
Estimated overnight cost +100 2,100
2,200
Assets KKM
+124 124
950 1,613
800
1,489 1,300
1,250
124
+124 124
2011
Decommissioning cost
2016
Disposal cost
Before After adjustment for cost study 2016
0
Before After adjustment for cost study 2016
Overnight cost increase due to higher risk reserves; timing effect leads to lower provisions
13
2017 ANNUAL RESULTS | BKW | 16.03.2017
Sound balance sheet: equity ratio at 34.3% 34.3%
CHF bn
32.2% 8,6 8,0 5,4
2,3
2,4
5,6
6,2
5,7
3,0 2,6
FY 2015
FY 2016
Increased equity ratio thanks to strong net profit
Non-current assets Current assets Equity Liabilities Equity ratio
14
2017 ANNUAL RESULTS | BKW | 16.03.2017
Share price development and shareholder structure CHF
+70%
52
BKW
47
Free float
37.5%
42
27.6%
37 52.5%
32
SPI
27
6.6% 3.3% 10.0%
22 17 12 30.12.2014
30.04.2015
31.08.2015
31.12.2015
30.04.2016
31.08.2016
31.12.2016
Canton of Berne Groupe E Ltd. E.ON SE (exchangeable bond) Treasury shares (convertible bond) Free float
Performance FY 2016: +30%, free float at 37.5% (incl. convertible bond BKW)
strike 32.21 EUR 38.09 CHF
15
2017 ANNUAL RESULTS | BKW | 16.03.2017
Convertible bonds BKW convertible bond (2020) Principal amount Issue price Conversion price Conversions until March 17 (nom.) Converted shares
CHF 163.4m 100 38.09 CHF 63.0 MCHF 1'638'818
CHF
CHF t
135
10000 9000
130
8000
39%
125
7000 6000
120
5000 115
4000
E.ON exchangeable bond (2018) Principal amount Underlying number of shares Conversion price Converted shares E.ON stake in BKW Feb 2017
CHF 113m 3'509'475 32.21 EUR 2'084'280
3000
110
6.65% 59% 2.7%
2000 105
1000 0
100 04.01.2016
07.03.2016
12.05.2016
15.07.2016
19.09.2016
21.11.2016
25.01.2017
BKW convertible bond Conversions
Significant conversions: 34% / 59%
16
2017 ANNUAL RESULTS | BKW | 16.03.2017
Operating revenue and EBIT per business area Operating revenue Operating profit One-off effects
CHF m 1,565
-5% +21%
1,481
925 +31%
762
565 +49%
73 189
430
38 198
-28% 136
+82%
133 17
2015
2016
2015
Energy
2016
2015
2016
2015
Grid
2016
2015
2016
Services
Strong growth of services and grid business, energy affected by negative price effects
2015
32 2016
17
2017 ANNUAL RESULTS | BKW | 16.03.2017
Energy: Considerable compensation of negative price effects CHF m 1,565
– Negative price effect on revenue: ~CHF -150m
-5%
– Partly offset on EBIT-level by
1,481
• Management of energy position • Reduction of operating cost • Cost reduction partner plants 73 189
-28% 136
FY 2015 FY 2016 Operating revenue
FY 2015 FY 2016 Operating profit
one-off effects
Negative price effects significantly compensated on EBIT level
– Volumes • Sales: increased non-regulated customers in Switzerland • Production: increased thermal, lower nuclear
18
2017 ANNUAL RESULTS | BKW | 16.03.2017
Grid: EBIT-contribution significantly increased – Increased EBIT thanks to higher regulatory asset base
CHF m +21%
– Passed on levies and charges are EBIT-neutral
925 762 +49% 38 198 133 FY 2015 FY 2016 Operating revenue
FY 2015 FY 2016 Operating profit
one-off effect
Comparable EBIT-contribution increased in line with expectations
– One-off compensation for expropriation of transmission grid (+CHF 38m) – One-time revaluation gain of CHF 11m relating to AEK acquisition
19
2017 ANNUAL RESULTS | BKW | 16.03.2017
Services: Growth leads to strong EBIT-increase CHF m
– Sales over CHF 0.5 billion, up by 31% – 18 acquisitions in 2016
+31%
– EBIT-margin 4% 6%
565 430 +82% 32 17 FY 2015 FY 2016 Operating revenue
FY 2015 FY 2016 Operating profit
Expansion on track with almost doubled EBIT and improved EBIT-margin
20
Outlook and strategy update
2017 ANNUAL RESULTS | BKW | 16.03.2017
Outlook FY 2017 Further negative impact of energy prices BKW expects to compensate these effects through – profitable growth of services business – active management of energy position – enforced cost management
BKW expects FY17 comparable operating profit to be on FY16 levels
22
2017 ANNUAL RESULTS | BKW | 16.03.2017
Shaping the future of energy – straightforward, reliable and integrated FUTURE
2014
TODAY
Reduce dependency on energy exposed to market Strengthen regulated income Keep recovery potential in energy A robust business model: Growth, risk diversification and sustainability
23
2017 ANNUAL RESULTS | BKW | 16.03.2017
Strengthen energy Invest in renewable energy production: wind and small hydro Strengthen energy trading Optimize maintenance in order to safeguard existing production portfolio Focus on operating cost Integrated approach of production, trading and sales
Reducing dependency on energy exposed to market while keeping recovery potential
24
2017 ANNUAL RESULTS | BKW | 16.03.2017
Growth of regulated energy production Investment in Europe’s largest on-shore wind farm project in Fosen (N) Acquisition of four wind farms in France BKW wind portfolio: −
Installed capacity:
440 MW
−
Under construction:
151 MW
Four small hydro power plants went on-stream in 2016 BKW small hydro portfolio: −
Installed capacity:
40 MW
−
Under construction:
10 MW
Well-balanced portfolio of regulated energy production
25
2017 ANNUAL RESULTS | BKW | 16.03.2017
Competence in energy trading Acquisition of majority stake in Wind Energy Trading (WET) Specialist in direct marketing of electricity from renewable energy sources Position management for decentralized energy production for wind farms and solar plants 3,500 MW across Germany and Austria (almost 10% of all Germany’s onshore wind farms)
BKW aligns its energy trading to changed market structures
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2017 ANNUAL RESULTS | BKW | 16.03.2017
Develop grid Investments of around CHF 100m per year to ensure security of energy supply Increase efficiency / reduce operating cost
Profitable, optimized management of grid to ensure reliable EBIT-contribution
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2017 ANNUAL RESULTS | BKW | 16.03.2017
Services around infrastructure
Engineering
Networks
Digital management of decentralized production
Exploit opportunities of increasingly complex energy supply system
Building technologies
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2017 ANNUAL RESULTS | BKW | 16.03.2017
Engineering: Signigicant growth of international network - BKW's already existing engineering skills are embedded in strong engineering network with today more than 1,000 engineers - Lindschulte, IFB Eigenschenk and Assmann join BKW's engineering network - BKW now has wide-ranging expertise to provide comprehensive solutions for infrastructure, energy and environment - Considerable need to invest in improving and expanding infrastructures - Resilient business due to diversified customer segments (manufacturing, public sector) - Business with attractive margins planning/consulting
Buildup of existing skills to strong international engineering network
installation
maintenance
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2017 ANNUAL RESULTS | BKW | 16.03.2017
Engineering: Comprehensive planning of large-scale projects Harbor site Spelle-Venhaus
Arena Regensburg
Combined engineering know-how enables BKW to develop unique large-scale projects in Europe
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2017 ANNUAL RESULTS | BKW | 16.03.2017
Building technologies: Buildings as an intelligent, integrated energy supply system
~50% Almost half of all energy in Switzerland is consumed by buildings
increase efficiency
Synergies and new market opportunities due to increasing complexity of new technologies
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2017 ANNUAL RESULTS | BKW | 16.03.2017
Building technologies: Fast growth throughout Switzerland − Successful growth: 7 acquisitions in 2016 − Most recent acquisition in French speaking part of Switzerland − BKW now has a network of building technology specialists throughout Switzerland −
Organization in geographical clusters
−
Each acquisition adds additional skills and build on existing expertise
−
Major potential in energy efficiency and intelligent usage
planning/consulting
installation
maintenance
Synergies and new market opportunities due to increasing complexity of new technologies
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2017 ANNUAL RESULTS | BKW | 16.03.2017
Networks: Provider of multi-utility services − BKW provides services in areas electricity supply, transport, telecommunications and water supply − Acquired companies add expertise to existing competences − Extensive and widespread networks need considerable maintenance − Swiss market for network services > CHF 1.5bn p.a.
planning/consulting
BKW able to provide comprehensive services for complex networks
installation
maintenance
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2017 ANNUAL RESULTS | BKW | 16.03.2017
BKW strategy shaped to create value Strengthen energy
Invest in renewable energy production Strengthen energy trading Focus on cost reduction
Develop grid
Optimize grid and grid revenues
Buildup services
Grow in focus areas - Engineering - Networks - Building technologies - Digital management of decentralized production
BKW business model geared towards growth: robust, profitable and sustainable
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Questions?
2017 ANNUAL RESULTS | BKW | 16.03.2017
Financial calendar and contact information Financial calendar – Publication of 2017 Annual Results:
16 March 2017
– Annual General Meeting:
12 May 2017
– Ex-dividend Date:
16 May 2017
– Dividend Payment:
18 May 2017
– Publication of 2016 Half-year Results:
5 September 2017
For further information, please contact: Thomas Herren, Investor Relations Officer Tel (+41) 58 477 53 56 [email protected]
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2017 ANNUAL RESULTS | BKW | 16.03.2017
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Disclaimer This presentation contains forward-looking statements which are made on the basis of current expectations and assumptions. These forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements. Potential risks and uncertainties include, among others, such factors as market and economic conditions, governmental regulations, competitive conditions, interest rates and fluctuation in currency exchange rates. Although BKW believes that its expectations reflected in any such forward-looking statement are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved. BKW undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
Appendix
2017 ANNUAL RESULTS | BKW | 16.03.2017
Sales in GWh Sales in GWh
2015
2016
Sales Switzerland
6,684
7,147
Sales International
2,148
2,348
11,703
11,370
Pump energy
249
382
Transmission losses and own consumption
191
202
20,975
21,449
Trading
Total
– Delivering electricity directly and indirectly via its distribution partners to more than 1 million residents in Switzerland – Strong market position – one of the most important distributors in Switzerland – Sales international refer to sales activities in Italy
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2017 ANNUAL RESULTS | BKW | 16.03.2017
Generation in GWh
Generation and purchases in GWh
2015
2016
Hydroelectric plants
3,983
3,614
Nuclear power plants incl. purchase contracts
5,875
5,261
Fossil-thermal power plants New renewable energy incl. fin. investments Total generation Trade (purchases) and energy buy-backs Total Total capacity MW
1,107
1,421
865
922
11'830
21,449
9,145
10,231
20,975
31,680
3,318
3,473
Capacity 2016
59%
41%
Peak load Base load
Output 2016 23% Peak load
77%
Base load
Peak load: storage, pump storage plants and CCGT Tamarete Base load: run-of-river, nuclear, other plants
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2017 ANNUAL RESULTS | BKW | 16.03.2017
Generation overview Switzerland (Core market) Generation 2016 (incl. French purchase contracts) Installed production 31.12.2016 Under construction
Norway 9.0 TWh
112 MW
2’490 MW 10 MW
France Generation 2016
Under construction
Germany 0.1 TWh
Installed production 31.12.2016
24 MW
Under Construction
39 MW
Generation 2016
0.6 TWh
Installed production 31.12.2016
413 MW
Italy Generation 2016
1.5 TWh
Installed production 31.12.2016
546 MW
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2017 ANNUAL RESULTS | BKW | 16.03.2017
Energy: Mühleberg nuclear power plant (KKM) −
Last day of operation: December 20, 2019
−
Cost study 2016 lead to a reduction of provisions (CHF -124m)
Financing framework for decommissioning and disposal Cost estimation excl. inflation
CHF
950m
Provisions 31.12.2016
State funds 31.12.2016
decommissioning cost
CHF 829m*
CHF 435m.
CHF 1,250m
disposal cost
CHF 661m
CHF
CHF 2,200m
estimated total cost
CHF 1,490m
CHF 1,069m
* Whereof CHF 415m directly financed (not covered by state funds)
634m
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