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Second Quarter 2020

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Second Quarter 2020 Second quarter 2020 About Scatec Solar Scatec Solar is a leading integrated independent solar power producer, delivering affordable, rapidly deployable and sustainable clean energy worldwide. A long- term player, Scatec Solar develops, builds, owns and operates solar power plants and has an installation track record of more than 1.6 GW. The Company has a total of 1.9 GW in operation and under construction on four continents. With an established global presence and a significant project pipeline, the company is targeting a capacity of 4.5 GW in operation and under construction by end of 2021. Scatec Solar is headquartered in Oslo, Norway and listed on the Oslo Stock Exchange under the ticker symbol ‘SSO’. Asset portfolio 1) Capacity Economic MW interest 2) In operation South Africa 448 46% Egypt 390 51% HQ Malaysia 197 100% Brazil 162 44% Ukraine Ukraine 101 77% Czech Republic Honduras 95 51% Jordan 43 62% Jordan Mozambique 40 53% Tunisia Czech Republic 20 100% Bangladesh Egypt Rwanda 9 54% Mali Total 1,505 58% Honduras Under construction Malaysia Ukraine 235 95% Argentina 117 50% Rwanda Brazil Malaysia 47 100% Total 399 82% Mozambique Projects in backlog South Africa Tunisia 360 65% Argentina Ukraine 65 65% Bangladesh 62 65% Mali 33 64% Total 520 65% Grand total 2,424 63% Projects in pipeline 5,620 Solar power plants in operation: 1,505 MW Plants under construction: 399 MW Projects in backlog: 520 MW Segment overview Development & Construction The Development & Construction segment derives its revenues from the sale of development rights and construction services delivered to power plant companies where Scatec Solar has economic interests. Power Production The plants produce electricity for sale under long term power purchase agreements (PPAs), with state owned utilities or corporate off-takers, or under government-based feed-in tariff schemes. The average remaining PPA duration for power plants in operation is 20 years. Services The Services segment comprises Operations & Maintenance (O&M) and Asset Management services provided to solar power plants where Scatec Solar has economic interests. O&M revenues are generated on the basis of fixed service fees with additional profit-sharing arrangements. Asset Management services typically include financial reporting to sponsors and lenders, regulatory compliance, environmental and social management, as well as contract management on behalf of the power plant companies. Corporate Corporate consists of activities of corporate services, management and group finance. 1) Per reporting date. 2) Scatec Solar’s share of the total estimated economic return from its subsidiaries. For projects under development the economic interest may be subject to change. Scatec Solar ASA 3 Q2’20 – Power production doubled – progressing large project opportunities • Power production reached 406 GWh, doubling production from the same quarter last year Proportionate revenues and EBITDA NOK million • EBITDA 1) of NOK 417 million, up from NOK 346 million in previous quarter 2,000 • Completed 140 MW in South Africa and Ukraine 1,500 • Raised gross NOK 1,968 million of new equity to fund further investments in renewables 1,000 • Limited impact of COVID-19 500 • The Board of Directors approves dividends of 0 NOK 131 million equivalent to NOK 0.95 per share evee A Key figures NOK million Q2 2020 Q1 2020 Q2 2019 YTD 2020 YTD 2019 Proportionate Financials 1) Revenues and other income 925 866 1,648 1,791 3,177 Power Production 458 391 258 849 455 Services 73 52 42 125 71 Development & Construction 383 414 1,339 797 2,636 Corporate 11 8 9 19 15 EBITDA 1) 417 346 388 763 703 Power Production 374 331 216 705 380 Services 34 16 19 50 26 Development & Construction 22 15 165 37 324 Corporate -13 -16 -11 -29 -25 Operating profit (EBIT) 262 206 298 468 531 Profit/(loss) -15 240 142 225 265 Net interest- bearing debt 1) 6,254 8,139 6,005 6,254 6,005 Power Production (GWh) 406 349 198 755 331 SSO proportionate share of cash flow to equity 1) 158 107 205 265 376 Consolidated Financials Revenues and other income 725 625 376 1,350 702 EBITDA 1) 580 503 290 1,083 531 Operating profit (EBIT) 377 328 188 705 333 Profit/(loss) -81 299 21 217 33 Net interest- bearing debt 9,868 12,038 9,367 9,868 9,367 Earnings per Share -0.76 1.87 -0.22 1.06 -0.51 Power Production (GWh) 2) 738 623 346 1,361 600 1) See Alternative Performance Measures appendix for definition. 2) Production volume on a 100% basis of all consolidated entities, including from JV companies. 4 Second quarter 2020 Group – Proportionate financials Q2 Q1 Q2 YTD YTD In the second quarter, proportionate revenues decreased NOK million 2020 2020 2019 2020 2019 compared to the same quarter last year due to lower construction activity only partly offset by higher power Revenues and other income 925 866 1,648 1,791 3,177 production revenues. Gross Profit 596 497 500 1,093 917 Operating expenses -180 -151 -111 -331 -213 The EBITDA increased by 7% compared to the same EBITDA 417 346 388 763 703 period last year and by 21% compared to the previous EBITDA margin 45% 40% 24% 43% 22% quarter, primarily driven by new solar power plants starting D&A and impairment -155 -140 -90 -295 -172 commercial operation. EBIT 262 206 298 468 531 Cash flow to equity 1) 158 107 205 265 376 With a larger portfolio of power plants in operation, both revenues and EBITDA increased in the Power Production Proportionate revenues and EBITDA segment, while decreasing in the Development & NOK million Construction segment due to lower construction activity. 2000 0 This continued change in segment mix resulted in a higher EBITDA margin for the Group compared to previous periods. 00 0 0 000 20 Operating expenses and depreciation increased, mainly due 00 0 to new solar power plants starting operation. 0 0 2 20 20 20 2020 2 2020 evenue EBITDA DA arn 1) See Alternative Performance Measures appendix for definition. Power Production – Proportionate financials Q2 Q1 Q2 YTD YTD At the end of second quarter, power plants with a total capacity NOK million 2020 2020 2019 2020 2019 of 1,505 MW were in operation. The total capacity increased by 140 MW from the end of previous quarter reflecting Revenues and other income 458 391 258 849 455 completion of the 258 MW solar power plant in Upington, Operating expenses -84 -60 -42 -144 -75 South Africa and the 54 MW Boguslav plant in Ukraine. EBITDA 1) 374 331 216 705 380 1) EBITDA margin 82% 85% 84% 83% 84% Production reached 406 GWh in the second quarter compared D&A and impairment -144 -125 -83 -269 -150 to 349 GWh in the previous quarter and 198 GWh in the same EBIT 230 206 133 436 230 quarter last year, mainly explained by added capacity. Cash flow to equity 1) 135 105 78 240 136 Operating expenses and depreciations increased due to the added capacity. The reduced EBITDA margin compared to the Proportionate revenues and EBITDA quarter is primarily reflecting seasonal production variations NOK million GWh in South Africa and Malaysia. 00 00 See additional information on page 14 for a specification of 00 00 00 financial performance for each individual power plant company. 200 200 00 00 Revenues and profitability in first half 2020 are explained by 0 0 the developments referred to above. 2 20 20 20 2020 2 2020 evenue A oer roducton GWh) 1) See Alternative Performance Measures appendix for definition. Scatec Solar ASA 5 Services – Proportionate financials Q2 Q1 Q2 YTD YTD Revenues from Services increased by 73% from the same NOK million 2020 2020 2019 2020 2019 period last year due to new plants starting operations in Ukraine, Egypt and South Africa. The revenues in second Revenues and other income 73 52 42 125 71 quarter also includes a NOK 14 million catch up of service Operating expenses -39 -36 -24 -75 -46 revenues, following a clarification of certain contracts in the EBITDA 34 16 19 50 26 portfolio which allows for earlier revenue recognition than 1) EBITDA margin 47% 31% 44% 40% 36% previously anticipated. D&A and impairment -1 -1 -1 -2 -2 EBIT 33 15 18 49 24 Operating expenses increased compared to the previous Cash flow to equity 1) 27 13 15 40 20 quarter and the second quarter last year, primarily due to the new plants in operation. The operating expenses mainly constitute fixed expenses, covering personnel and recurring Proportionate revenues and EBITDA maintenance cost reflecting fixed maintenance schedules. NOK million 0 Revenues and profitability in first half 2020 are explained by the developments referred to above. 0 0 20 0 2 20 20 20 2020 2 2020 evenue A 1) See Alternative Performance Measures appendix for definition. Development & Construction (D&C) – Proportionate financials Q2 Q1 Q2 YTD YTD D&C revenues in second quarter were generated by the NOK million 2020 2020 2019 2020 2019 projects in Malaysia, South Africa, Ukraine and Argentina. Accumulated progress across ongoing construction projects Revenues and other income 383 414 1,339 797 2,636 at the end of the second quarter was 96%. Gross Profit 53 46 190 99 376 1) Gross Margin 14% 11% 14% 12% 14% Construction was completed for an additional 54 MW in -32 Operating expenses -31 -25 -63 -52 Ukraine and 86 MW in South Africa. Further, the second solar EBITDA 22 15 165 37 324 hybrid project for a United Nations (UN) organisation in South D&A and impairment -4 -10 -5 -14 -18 Sudan was completed.
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