TIDMGLO
RNS Number : 2579D
ContourGlobal PLC
27 October 2020
27 October 2020
ContourGlobal plc
Trading Update
ContourGlobal plc (the "Company"), an international owner and
operator of contracted wholesale power generation businesses, today
issues a trading update for the period from 1 January 2020 to 30
September 2020.
Joseph Brandt, Chief Executive Officer, said: "We continue to
make good progress with ContourGlobal on track to meet our 2020
Adjusted EBITDA guidance of $710 million to $745 million(1) . I am
pleased to be able to confirm the third quarter dividend payment of
4.0591 cents per share(2) , maintaining our commitment to a 10%
annual increase in dividends.
Our results reflect the resilience of our business model, with
ContourGlobal continuing to deliver strong and predictable cash
flow generation. While COVID-19 has posed challenges to every
business and economy I am pleased with the way that we have
responded. The dedication of our workforce has ensured the
continued safe operation of our assets around the world and has
meant we have experienced no material operational or financial
impact from COVID-19."
Strong operating and financial performance
-- Continued industry leading Health and Safety performance with
0.05 Lost Time Incident Rate ("LTIR") in the first 9 months of 2020
(one LTI year-to-date ("YTD") occurred at our Vorotan hydro plant
in Armenia in September 2020).
-- Operational performance remains strong with an average
availability factor of 9 4.6 % in the first 9 months of 2020
combined across the thermal and renewable fleets, compared to 93.5%
for the comparable period last year.
-- Adjusted EBITDA up 2% for the first 9 months of 2020 to
$542.8 million vs. $531.6 million for the comparable period in
2019. The increase is driven by the Thermal division, reflecting
the Mexico CHP acquisition completed in November 2019 (+$74m) and
better commercial terms in the Renewable fleet (+$7m). This was
partially offset by net cash gains from Spanish CSP and European
Solar farm-downs in 2019 (-$46m) and negative FX effect
(-$23m).
-- Strong cash flow generation with Funds from Operations
("FFO") reaching $314.1 million in the first 9 months of 2020, a
10% increase from the comparable period in 2019, primarily due to
higher Adjusted EBITDA, higher distributions from JVs in Colombia
and lower interest paid, partially offset by higher distributions
to non-controlling shareholders, higher tax paid and higher
capex.
-- Our cash conversion rate (FFO / Adjusted EBITDA) continued to
be strong at 58% for the first 9 months of 2020, higher than for
the comparable period in 2019 (54%), reflecting the FFO impacts
mentioned above.
-- Net profit up 64% in the first 9 months of 2020 to $85.5
million vs. $52.2 million for the comparable period in 2019
benefiting mainly from a non-cash revaluation of $43 million for a
derivative in the Mexican CHP assets that locks in a fixed
electricity price margin for certain contracts that would otherwise
be impacted by electricity and gas price volatility. Adjusted net
profit down 34% in the first 9 months of 2020 to $54.9 million vs.
$83.4 million for the comparable period in 2019 mainly due to
excluding the above mentioned positive $43 million non-cash change
in fair value of the Mexican CHP derivative in 2020 as well as the
2019 Adjusted Net Profit benefiting from adding back $15 million of
hedge breaking costs associated with the refinancing of our Italy
and Slovakia PV assets.
-- As separately announced today, the Company will pay a
dividend for Q3 2020 of 4.0591 cents per share(2) , equivalent to
$26.92 million(3) to be paid on 29 December 2020. This is in line
with the Company's commitment to an annual 10% increase in dividend
per share.
COVID-19
he Company continues to experience no material operational or
financial impact as a result of COVID-19. We continue to focus on
the health and safety of our employees, continued business
resilience, and community support.
Delivering on our growth commitments
We continue to focus on external growth opportunities and our
M&A pipeline remains very robust.
Operational highlights
----------- -------- --------
USDm 9M 2020 9M 2019 Change
------------------------------------- -------- -------
GWh produced Thermal 7,627 6,035 26.4%
------------------------ ----------- -------- -------
Renewable 3,644 3,907 (6.7%)
------------------------------------ -------- -------
MW in operation Thermal 2,992 2,512 19.1%
------------------------ ----------- -------- -------
Renewable 1,813 1,790 1.3%
------------------------------------ -------- -------
Availability factor Thermal 93.5% 91.3% 2.2%
------------------------ ----------- -------- -------
Renewable 96.4% 96.7% (0.3%)
------------------------------------ -------- -------
Financial highlights
-------- --------
USDm 9M 2020 9M 2019 Change
-------------------------------- -------- --------
Revenue 1,017 961 5.8%
-------------------------------- -------- --------
Income from operations 246 231 6.5%
-------------------------------- -------- --------
Adjusted EBITDA* 543 532 2.1%
-------------------------------- -------- --------
Thermal Adj. EBITDA 308 238 29.4%
-------------------------------- -------- --------
Renewable Adj. EBITDA 259 319 (18.9%)
-------------------------------- -------- --------
Corporate Adj. EBITDA (24) (26) (5.8%)
-------------------------------- -------- --------
Proportionate Adjusted EBITDA* 422 427 (1.2%)
-------------------------------- -------- --------
Funds from Operations (FFO)* 314 285 10.1%
-------------------------------- -------- --------
Net profit 86 52 63.8%
-------------------------------- -------- --------
Adjusted Net profit* 55 83 (34.2%)
-------------------------------- -------- --------
*Non-IFRS metrics
Share buy-back update
The Company commenced a buy-back programme on 1 April 2020, to
repurchase up to GBP30 million of shares. Up until 30 September
2020, 6,464,387 shares have been repurchased for a consideration of
GBP11.5 million and are held in treasury, representing a further
return of capital to shareholders in addition to the dividend
payments.
Outlook
ContourGlobal's business model is highly resilient with stable
and predictable cashflows. We have not seen meaningful disruption
to operations as a result of COVID-19 to date, and current trading
is in line with our expectations. As a result, we reiterate our
2020 Full Year guidance for Adjusted EBITDA in the range of $710m -
$745m(1) and maintain our dividend policy of an 10% annual increase
in dividend per share.
(1) (Based on constant exchange rates from 2019 of EUR/USD 1.12
and BRL /USD 0.25, and assuming no prolonged disruption to
operations, human resource and to our off-takers from the current
COVID-19 pandemic.)
(2 Payment of 4.0591 cents per share, or 3.1139 pence per share.
Further details on timing announced separately today.)
(3 Based on 663,114,749 shares in issue as at 23 October 2020,
excluding shares held in treasury)
Enquiries
Investor Relations - ContourGlobal
Alice Heathcote
+1 617 690 9633
+44 (0) 203 626 9077
alice.heathcote@contourglobal.com
investor.relations@contourglobal.com
Media - Brunswick
Charles Pretzlik/William Medvei
Tel: +44 (0) 207 404 5959
Contourglobal@brunswickgroup.com
About ContourGlobal
ContourGlobal is listed on the premium segment of the London
Stock Exchange (TKR: GLO). ContourGlobal is an international owner
and operator of contracted wholesale power generation businesses
with approximately 4.8 GW in operation in 18 countries.
ContourGlobal operates a portfolio of 107 thermal and renewable
power plants across Europe, Latin America, and Africa utilizing a
wide range of technologies.
Cautionary note regarding forward-looking statements
These results 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", "plans", "goal", "target", "aim", "may",
"will", "would", "could" or "should" or, in each case, their
negative or other variations or comparable terminology. These
forward-looking statements include all matters that are not
historical facts. They appear in a number of places throughout
these results and the information incorporated by reference into
these results and include statements regarding the intentions,
beliefs or current expectations of the directors or the Company
concerning, amongst other things, the results of operations,
financial condition, liquidity, prospects, growth, strategies and
dividend policy of the Company and the industry in which it
operates.
By their nature, forward-looking statements involve risks and
uncertainties because they relate to events and depend on
circumstances that may or may not occur in the future and may be
beyond the Company's ability to control or predict. Forward-looking
statements are not guarantees of future performance. The Company's
actual results of operations, financial condition, liquidity,
dividend policy and the development of the industry in which it
operates may differ materially from the impression created by the
forward-looking statements contained in these results and/or the
information incorporated by reference into these results. In
addition, even if the results of operations, financial condition,
liquidity and dividend policy of the Company and the development of
the industry in which it operates, are consistent with the
forward-looking statements contained in these results and/or the
information incorporated by reference into these results, those
results or developments may not be indicative of results or
developments in subsequent periods.
Other than in accordance with its legal or regulatory
obligations, the Company does not undertake any obligation to
update or revise publicly any forward-looking statement, whether as
a result of new information, future events or otherwise.
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END
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October 27, 2020 03:00 ET (07:00 GMT)
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