Phoenix Solar AG
1 Disclaimer
The content of this presentation is solely for information purposes and is not intended to constitute a recommendation for investment or a solicitation to subscribe or an offer to buy or sell securities of the company. Phoenix Solar AG shall undertake no liability whatsoever for any loss in connection with this presentation or the information contained therein. This also applies particularly to any eventual loss in connection with the shares of Phoenix Solar AG.
This document contains forward-looking statements on future developments which are based on management’s current assessment. Words such as “anticipate”, “assume”, “believe”, “estimate”, “expect”, “intend”, “can/could”, “plan”, “project”, “forecast”, “should”, and similar terms are indicative of such forward-looking statements. Such statements are subject to certain risks and uncertainties which are mainly outside the sphere of influence of Phoenix Solar AG, but which have an impact on the business activities , the success , the business strategy and the reesults. These risks and factors of uncertainty include, for instance, climatic change, changes in the state subsidisation of photovoltaics, the introduction of competitor products or technologies of other companies, the development of the planned internationalisation of business activities, fierce competition as well as rapid technological change in the photovoltaic market. If one of these or other factors of uncertainty or risks should occur, or if the assumptions underlying the statements should prove incorrect, the actual results may diverge substantially from the results in these statements or implicit indications. Phoenix Solar AAG does not have the intention nor will it undertake any obligation to realise forward-looking statements on an ongoing basis or at a later point in time as this is entirely dependent on circumstances prevailing on the day of their release.
In some countries the dissemination of this presentation and the information contained therein may be restricted or prohibited undthlder the law. This presen ttiithftation is therefore express ly no titdt intendddfed for persons res idtilident in lega l sys tems un der w hihhich suc h an offer or solicitation is not permissible, or for persons for whom such an offer or invitation would constitute a breach of the law.
2 Table of Contents
1. Phoenix at a Glance 2. Company Profile 3. Market Development 4. Module Supply 5. Financial Parameters 6. Phoenix Share - SonnenAktie® 7. Investment Highlights
3 Phoenix Solar at a Glance
Founded Nov. 1999, headquartered near Munich, glo ba l wor kforce >230 One of the leading globally active PV system integrators (3 continents , 6 countries) CAGR revenue: >80% CtiContinuous ly pro fitblifitable since 2004 2 Stock-listed since November 2004, TecDAX-listed since March 2008 First mover in PV thin-film technology, holding 12% world market share in 2007 Covered by 14 banks/institutions, further coverage under preparation
4 Phoenix Solar’s Worldwide Company Locations in 6 countries and 3 continents
Phoenix Solar AG, Germany ¦ (since Nov. 1999) ¦ ¦ ¦ Phoenix Solar S.L., Spain (since April 2006)
Phoeni x S ol ar Phoenix Solar S.r.l., Italy Pte Ltd, (since July 2006) Singapore (since Dec. 2006) Phoenix Solar E.P.E., Greece (since June 2008)
Phoenix Solar Pty Ltd, Australia (since July 2008)
All 100% owned subsidiaries, except Phoenix Solar Singapore (75%
5 Table of Contents
1. Phoenix at a Glance 2. Company Profile 3. Market Development 4. Module Supply 5. Financial Parameters 6. Phoenix Share - SonnenAktie® 7. Investment Highlights
6 Business Model - Overview
International Manufacturers
Solar Modules BOS-CtComponents • Crystalline • Inverters • Thin-film • Mounting Systems • Cables System integration
Turn-key installation
Segment Segment Solar Power Plants Components & Systems
Project Investors International Customers Resellers
7 Phoenix Solar’s Offering to the Customer
Segments
Investor Business Power Plants Power Plant Sales
Components & Systems
0,11 kWp* MWp 500 kWp 1 MWp10 10 MWp+ MWp
Phoenix Solar’s business model covers all PV system sizes: • Components & Systems 1kWp - 1 MWp • Power Plants > 500 kWp * not to scale
8 Focused Business Model
Focus on Photovoltaics ElilExclusively active in the fie ld o f pphhtotovolt ltiaics, the mark et segment of renewable energies with the highest growth rate
Focus on PV System Technology Focus on core competence of high-yield, long-lasting and profitable PV syst ems System integrators are the gateway to the end customer
Advantages of Focused Business Model - Purchase of PV modules and components with the best price-to-performance ratio independent of the manufacturer - High flexibility, rapid response to market trends - Low financial risk as limited investment is required
9 Business Model – Solar Power Plants
A full-service package in the Power Plant segment Phoenix offers project investors an all-inclusive services & products package
Benefits Phoenix Solar AG Benefits Phoenix Solar Energy IttAGInvestments AG Planning of power plants Project development Procurement und delivery Financial consulting / fund structuring Turn-key installation Funds management Plant management Event management Operation and maintenance
10 Target Customers for Large Solar Power Plants
Closed Solar Funds as capital collection point for private investors - Participation starting at €10,000 - Fund capitalisation starting at €20M nership usiness - Expected Return: > 6% ww Institutional investors, insurance companies, pension funds vestor B roject O n n - Risk spreading (in addition to equitiess, I P P annuities, real estates) - Planable cash flow!!
Trade, Industry und Commerce - Secure financial returns
t Sales - Green image benefit tracts nn nn Local Communities - Secure financial returns
EPC Co - Sensible use of agricultural lands ower Pla P P
11 Competence in Large-scale Roof-Mounted Solar Power Plant Design & Construction
Munich Trade Fair (Germany), 2.1 MWp Completion November 2002
12 Competence in Large-scale Ground-Mounted Solar Power Plant Design & Construction
SolarPark Miegersbach (Germany), 5.3 MWp Completion December 2005
13 Competence in Large-scale Ground-Mounted Solar Power Plant Design & Construction
“La Solana” (Spain), 6.5 MWp Comp leti on M arch 2008
14 Features of Phoenix Solar’s Operation, Monitoring & Maintenance Service
Utility standard 24/7 stand-by service independent from inverter manufacturers 24-hour reaction time in case of pltfillant failure International service network with local contact persons Customer access to all plant data Reportingg(y to customer (monthly, quarterly, yearly) Continuous plant optimisation 85 MWp under management as of Jan. 2009, 150 MWp expected end 2009
15 Table of Contents
1. Phoenix at a Glance 2. Company Profile 3. Market Development 4. Module Supply 5. Financial Parameters 6. Phoenix Share - SonnenAktie® 7. Investment Highlights
16 Phoenix Solar & the German Market 2008/2009
German market - Strong demand in both the Components & Systems and Power Plants segments throughout 2008 continuing into 2009 - On 19 December 2008 Phoenix reported a total plant installation 2008 of 50 MWp and grid-connection of the 5.6 MWp Has born pro ject for KGALL - Large-scale power plant project financing delayed due to financial crisis starting in Q4 20008 and is still an issue in Q1 2009
Significant market growth in 2009 to 2 GWp expected
17 Phoenix Solar & Spanish Market 2008/2009
Spanish market - Spanish market boom 2008 has come to an abrupt end - New Roya l Decree 1578/20008 with s ign ifican tly re duce d fee d-in tariffs and hard cap introduced Æ Spppanish market expectation 2009 siggynificantly below market 2008 - Market size and access to projects difficult to predict - Initial demand for large-scale power plants exists but generally cautious view on Spanish market 2009
18 Phoenix Solar and Italian & Greek Market 2008/2009
Italian market - Market 2009 may triple to 5 -600 MWp (from > 150 MWp in 2008) - Financing from Italian banks & grid connection still an issue - Phoenix Solar well positioned with 100% owned Phoenix Solar subsidiary in Rome - Significant volumes of large-scale projects under development Greek market - Demand has been picking up in 2008 but volume still very small compared to Spain and Italy - Market growth below expectations due to bureaucratic hurdles and long project permitting perioods
Italy is the most promising European market 2009 aft er Ge Germany
19 Table of Contents
1. Phoenix at a Glance 2. Company Profile 3. Market Development 4. Module Supply 5. Financial Parameters 6. Phoenix Share - SonnenAktie® 7. Investment Highlights
20 Phoenix Solar’s Solar Module and Inverter Suppliers & Long-Term Contracts
50 MWp framework contraact 2008 – 2011
Inv erter Suppliers
450 €M framework contract 2008 - 2011 108 MWp framework contract 2008 - 2011
411 MWp framework contract 2008 - 2012
21 Phoenix Solar Product Mix: Thin-film vs. Crystalline Modules
100% Crystalline 90%
80% 42.8% 40% 52.1% 48.1% 70% 78.5% 60% 79.7% 83. 1% 50% 100%
40% Thin-film
30% 57.2% 60% 47.9% 51.9% 20% 21.5% 10% 20.3% 16.9% 0% 2002 2003 2004 2005 2006 22007 2008 2009e
22 Table of Contents
1. Phoenix at a Glance 2. Company Profile 3. Market Development 4. Module Supply 5. Financial Parameters 6. Phoenix Share - SonnenAktie® 7. Investment Highlights
23 Guidance 2009 & Outlook 2013
Guidance 2009 Long-term Outlook 2013 (as of 27 January 2009) (as of 27 January 2009) Sales: 520 €M Sales: 1.5 bil. € EBIT: 31 €M EBIT: 100 €M Expansion of international Positioning of Phoenix business to more than 35 % Solar as a globally leading of sales systems integrator Expansion of international business to more than 65% ooffl sales
24 Sales Development
1500 700 € M 600 ~ ~ 520 500
400 380
300 260.1
200 111.1 119.0 100 67.2 20.8 23.5 0 4.0 14.4 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008e 2009e ... 2013e Up to 2003: Phoenix Solar AG (HGB 2004 onwards: Revenue of Phoenix Concern (IFRS
25 Sales Development per Full-Time Equivalent
Sales €T 2200 2000 1915 1778 1800 1600 1555 555 1400 13
1200 €T
1000 2000 1732 800 +54% 621 1500 551 575 1124 600 1000 400 5 200 00
0 2001 2002 2003 2004 2005 20 06 2007 Q1-Q3 '07 Q1-Q3 '08
Accounting Basis: HGB; from 2004 onwards IFRS
26 EBIT / EBIT-Margin Development
100 EBIT40 EBIT (€ M) Margin 10% 35 ~ 33 8.6% ~ 31 ~ 30 8% 6.9% 25 22.3 6% 20 4.0% 3.7% 15 4%
10 7.7 2% 4.8 5 2.5
0 0%
2004 2005 2006 2007 2008e 2009e ... 2013e AditIttilFiilAccording to International Financial Reporting Standards (IFRS)
27 Order Backlog Development
€M 300 275 280 260 231 240 230 220220 199 200 132 180 56 160 1 43 138 140 167 120 109 214 92 100 75 88 42 73 76 80 1 26 143 6 143 60 36 40 67 63 67 63 20 17 1 7 1.1.08 1.4.08 1.7.08 1.10.08 1.1.08 1.4. 0 8 1.7.08 1.10.08 1.1.08 1.4.08 1.7.08 1.10.08 1.1.08 1.4.08 1.7.08 1.10.08 1.1.08 1.4.08 1.7.08 1.10.08 1.1.08 1.4.08 1.7.08 1.10.08 TotalPowoweeatsr Plants Compo ne nts & Syste m s Percentage-of-Completion Revenues
28 Review Q4 2008
Module sales and purchase prices movinggy down substantially in Q4 2008 increasing profitability of PV systems
Two weeks of delivery lost in December due to harsh winter conditions in Germany, i.e. - Order backlog 2008 had partlyy to be transferred into Q1 2009 - Year-end inventory higher than initially planned
Total order intake Q4 2008 subbstantially higher than Q4 2007
Overall revenue expectations met
29 Highlights Q4 2008
10 October: Phoenix Solar ranked no. 2 in Ernst & Young’s Entrepreneur of the Year award
6 November: Phoenix Solar winns its biggest roof -mounted PV system totalling 2.3 MWp for public service company SWU
20 November: Phoenix Solar seecures the Group’ s future growth through a syndicated loan of 150 €M for working capital financing and to cover need for bank guarantees and letters of credit. The agreement was signed with six banks and has a term of three years. Together with the capital increase carried out in April 2008 long-term financing of Phoenix Solar’ s operation is highly secure
18 December: RED2002 srl, based in Rome, renamed to Phoenix Solar srl , effective from 1 January 2009
30 Outlook to 2009
Seasonal business expected in 2009 similar to 2007 and the previous years (weak Q1 and sstrong Q4). 2008 unusual pattern with revenue and profit peaks in Q2 & Q3 due to the Spanish market
Positive view on market development 2009 by customers and Phoenix Solar’s sales department, however to date final market trends too early to predict
Q1 2009 startinggy slowly due to heavy winter conditions in Germany and vacation period, however: - Order intake in the Components & Syg(ystems segment (as of 21 January) is higher in a year-on-year comparison - Power Plant construction planned to be resumed between mid and end Q1 2009
31 Highlights Q1 2009
Project company Scarlatti srl accquired. Scarlatti holds shares in four project companies which develop projects in Italy totalling 27 MWp
KGAL contract extension: +150 €M for 2011, now sales volume totalling a minimum of 375 €M 2009 – 2011
Phoenix highly ranked in specialised journal “BOERSE ONLINE” yyyearly analy sis “Best Investor Relations Germany”. Phoenix Solar ranked no. 1 of all TecDAX-listed companies and no. 6 of all stock listed companies of the DAX, MDAX, TecDAX and SDAX
32 Table of Contents
1. Phoenix at a Glance 2. Company Profile 3. Market Development 4. Module Supply 5. Financial Parameters 6. Phoenix Share - SonnenAktie® 7. Investment Highlights
33 Share Price Performance of Phoenix Solar vs. TecDAX Index
Phoenix Solar TecDAX
34 Dividend Payment
Phoen ix So lar has been pay ing ddivid en ds s ince 2007 Shareholder-oriented dividend policy according to company growth and business situation
Financial year Date of Gross ddividend Number of Payout ratio distribution per share shares 2006 29.05.2007 0.10 € 6,077,000 27 %
2007 05.06.2008 0.20 € 6,648,500 37 %
2008 20.05.2009e TBD (>0) 6,648,500 TBD
35 Development of Analyst Coverage
Institution since Institution since ÖKO-Invest Verlag Pacific Crest 31.01.2005 12.06.2008 Vienna Portland
Citigroup UniCredit 03.06.2005 25.08.2008 London Munich Deutsche Bank FBR Capital Markets 25.08.2005 15.09.2008 Frankfurt San Francisco Commerzbank Main First 21.11.2005 17.09.2008 Frankfurt/Main Frankfurt
Equinet AG Dexia 22.05.2006 09.10.2008 Frankfurt Brussels
HSBC Trinkaus & Burkhardt Viscardi 17.08.2006 New! 07.11.2008 Dusseldorf Munich
Goldman Sachs BHF Bank 17.10.2006 New! 02.12.2008 London Frankfurt
36 Table of Contents
1. Phoenix at a Glance 2. Company Profile 3. Market Development 4. Module Supply 5. Financial Parameters 6. Phoenix Share - SonnenAktie® 7. Investment Highlights
37 Investment Highlights
Business model focuses on the core capabilities (PV systems technology), allows for high flexxibility and fast exploitation of market opportunities
As system integrator Phoenix Solar is the gateway to the end customer
Expansion of international business to more than 50% of sales by 2010 and 65 % by 2013
World-leading expertise in large-scale power plant construction using thin-film systems technology
Phoenix Solar AG – a “PV pure play”
38 Thank you for your attention!
39 Phoenix Solar share in brief
ISIN DE000A0BVU93
Share class No-par bearer share
Number of shares as per 30/06/08 6,684,500 units
Share capital 6,684,500 €
Stock market segment Official Market, Prime Standard
40 Contact
Phoenix Solar AG
Hirschbergstrasse 8 D-85254 Sulzemoos Germany
Phone +49 8135 938-000 www.phoenixsolar.com Fax +49 8135 938-399 [email protected]
Investor Relations Public Relations Anka Leiner Andrea Zepf Phone +49 8135 938-315 PPhone +49 8135 938-313 [email protected] [email protected]
41 Quarterly Sales Development 2007 / 2008 Power Plant Segment
Power Plant Segment €M 84 % revenue increase yyyoy 90 Sales 80.9 Q3 2008 revenues surpass Q4 2007 80 +22% 148 % increase 66.5 70 64. 8 Q1-3 2008 vs. Q1-3 2007 60 +48% +303% Germany and Spain were the
50 revenue drivers 43.9 €M 40 +139% 140 130.7 120 +132% 30 100 18.4 80 20 16.5 56.4 +406% 60 10 40 3.6 20 0 0 Q1'07 Q2'07 Q3'07 Q4'07 Q1'08 Q2'08 Q3'08 2006 2007
42 Quarterly EBIT Development 2007 / 2008 Power Plant Segment EBIT EBIT- €T Margin Power Plant Segment 12,000 22% Almost 54 % EBIT increase yoy 11,000 10694 20% Stable EBIT margin compared to 9885 10,000 Q2-2008 16.5% 18% 9, 000 8405 14.6% 16% 155 % increase Q1-3 2008 vs. Q1- 8,000 14% 3 2007 – in line with revenue 12.6% 12.2% 7,000 increase 6429 12% 6,000 €M 10% 5,000 8.3% 20 17.9 8% 4, 000 15 1.3% 6% +459% 3,000 2.9% 10 2,000 4% 2% 5 323.2 1,000 303 533 214 0 0 0 Q1'07 Q2'07 Q3'07 Q4'07 Q1'08 Q2'08 Q3'08 2006 2007
43 Quarterly Sales Development 2007 / 2008 Components & Systems Segment
Components & Systems Segment €M 80 Sales 133 % revenue increase yyyoy
68.4 108 % increase 70 63.2 Q1-3 2008 vs. Q1-3 2007 +56% 60 GGditlthherman revenues dominate although international revenues increased +116% 50 43.7 significantly € M 40 +74% 140 129.3 +15% 29.3 120 +107% 30 25.4 25.1 100 +123% 80 20 62.5 11.4 60 10 40 20 0 0 Q1'07 Q2'07 Q3'07 Q4'07 Q1'08 Q2'08 Q3'08 2006 2007
44 Quarterly EBIT Development 2007 / 2008 Components & Systems Segment EBIT EBIIT- €T Margin Components & Systems Segment
8000 7707 18% Higgggher revenues and higher margin 15% modules lead to significant EBIT 7000 11.3% margin increase (11.3%) 9.9% 12% 6000 63%6.3% 99% 593 % increase Q1-3 2008 vs . 4.3% 5000 6% Q1-3 2007 – far greater than the 1.7% 0.6% revenue increase 4000 3% € M 2887 2782 2772 0 3000 5 - 3% 4.3 2000 - 6% 4 +230% - 9% 1000 430 3 146 - 12% 0 2 1.3 - 15% -15.8% - 1 1000 - 18%
-2000 -1783 - 21% 0 Q1'07 Q2'07 Q3'07 Q4'07 Q1'08 Q2'08 Q3'08 2006 2007
45 Quarterly Sales Development 2007 / 2008 Group Results
€M Group Sales 160 Sales 1149, 3 Best quarter revenue ever (Q3 2008 sales higher than Q4 140 +35% 128.1 2007)
120 110.2 104 % revenue increase yoy +75% 100 128 % increase +165% Q1-3 2008 vs. Q1-3 2007 80 73.2 €M +67% 300 260.1 60 250 +119% 43. 8 41.6 200 40 +192% 150 119.0
20 15.0 100 50 0 0 Q1'07 Q2'07 Q3'07 Q4'07 Q1'08 Q2'08 Q3'08 2006 2007
46 Quarterly EBIT Development 2007 / 2008 Group Results
EBIT EBIT-Margin Group EBIT (€ T) Best quarter EBIT ever 175599 18,000 (Q3 2008 EBIT higher than Q4 24% 16,000 2007) 20% 14, 000 13280 85 % EBIT increase yoy 16% 12,000 13.0% 11173 11.8% 10.4% 10.1% 12% EBIT margin remains on very 10,000 9499 high level 8% 8,000 €M 25 22.3 6,000 4% 20 +365% 22%2.2% 0% 4,000 0.9% 15
2,000 -1480* 960 -4% 10 359 4.8 -8% 5 - 9.8% -2,000 -12% 0 Q1'07 Q2'07 Q3'07 Q4'07 Q1'08 Q2'08 Q3 '08 2006 2007
* Adjusted in Q3-2007 according to Int’l Accounting Standard (IAS) 8.49
47