6-K
Enlight Renewable Energy Ltd. (ENLT)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of March 2023
Commission File Number: 001-41613
Enlight Renewable Energy Ltd.
(Translation of registrant’s name into English)
13 Amal St., Afek Industrial Park
Rosh Ha’ayin, Israel
- 972 (3) 900-8700
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
EXPLANATORY NOTE
On March 15, 2023, Enlight Renewable Energy Ltd. issued a press release titled: “Enlight Renewable Energy Reports Year-End 2022 Financial Results”. A copy of the press release is furnished as Exhibit 99.1 herewith.
EXHIBIT INDEX
The following exhibit is furnished as part of this Form 6-K:
| Exhibit No. | Exhibit Description |
|---|---|
| 99.1 | Press Release of Enlight Renewable Energy Ltd., dated March 15, 2023, titled:<br> "Enlight Renewable Energy Reports Year-End 2022 Financial Results". |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Enlight Renewable Energy Ltd. | ||
|---|---|---|
| Date: March 15, 2023 | By: | /s/ Nir Yehuda |
| Nir Yehuda | ||
| Chief Financial Officer |
Exhibit 99.1
Press Release
ENLIGHT RENEWABLE ENERGY REPORTS
YEAR-END 2022 FINANCIAL RESULTS
All of the amounts disclosed in this press release are in U.S. dollars unless otherwise noted
TEL AVIV, ISRAEL, March 15, 2023 – Enlight Renewable Energy Ltd. (NASDAQ: ENLT, TASE: ENLT) today reported financial results for the full year ended December 31, 2022.
The Company’s annually earnings materials and a link to the earnings webcast, which begins today at 8:00 AM ET, may be found on the investor relations section of Enlight’s website at https://enlightenergy.co.il/data/financial-reports/
“We delivered record results in 2022, with revenue up 88% and Adjusted EBITDA^*^up 96% demonstrating our deep track record of converting projects under development through to construction and operations. We succeeded in bringing over 800 MW to operation, commenced construction on 630 MW of generation and 1.7 GWh of energy storage, and expanded our overall Mature Project portfolio^1^ by 0.9 GW. The entirety of our Mature Project portfolio, including 4.5 GW of generation and 2.7 GWh of energy storage globally, is expected to reach commercial operation by the end of 2025, providing us with a clear path on the future of our business”, said Gilad Yavetz, CEO of Enlight Renewable Energy.
“Enlight is a global renewable energy leader with operations and projects in the United States, Europe and Israel. We have been a top performing publicly traded company in Israel for the past decade and we believe the proceeds from our recent initial public offering in the United States will accelerate our growth, particularly in the United States, where, to our knowledge, we are now the first publicly traded pure-play greenfield renewable energy developer,” Yavetz added. “With the passage of the Inflation Reduction Act in the U.S. and a supportive regulatory backdrop in Europe, we believe we are well positioned to deliver both rapid growth and above-market project returns. We are therefore increasing our annual project deployment guidance from 2026 and beyond to 1.5 GW per year, as we believe we are very well positioned to strategically capture the largest and most attractive renewable energy opportunities across our markets.”
^1^ Mature Projects include projects which are operational, under construction, in pre-construction (due to commence construction within 12 months as of March 15, 2023 (the “Approval Date”)) and projects with signed PPAs.
Highlights
| • | FY 2022 Revenue of $192m, Adjusted EBITDA^*^ of $130m, and Net Income of $38m, up 88%, 96% and 76% year over year, respectively. The company also generated $18m of proceeds from the sale of<br> electricity which were not recognized as revenue or included in Adjusted EBITDA under the International Financial Reporting Standards (“IFRS”) for projects treated as Financial Assets.^2^ |
|---|---|
| • | Record quarterly Revenue of $61m and Adjusted EBITDA^3^ of $43m, growing 74% and 99%, respectively, year over year. The company also generated $2m of<br> proceeds from the sale of electricity which were not recognized as revenue or included in Adjusted EBITDA, for projects treated as Financial Assets^2^. |
| --- | --- |
| • | Robust near-term growth, supported by 1.4 GW of operational projects with an additional 1 GW of generation and 1.7 GWh of storage capacity of projects under construction. |
| --- | --- |
| • | Significant increase to our Mature Project portfolio in the fourth quarter of 2022, growing by 14% to 4.5 GW of generation and 2.7 GWh of storage, all of which is expected to reach commercial operation<br> date (“COD”) by year end 2025. |
| --- | --- |
| • | $271m net proceeds raised in an initial public offering in the United States in February 2023. |
| --- | --- |
| • | Strong full year 2023 Revenue and Adjusted EBITDA^3^ guidance, with an increase of 54% over 2022 revenues and 48% over 2022 Adjusted EBITDA at the midpoint, driven by projects which have become<br> operational in H2 2022 and additional projects that are expected to begin operations over the course of 2023. |
| --- | --- |
| • | Medium term project deployment guidance updated to 1.5 GW of project additions per year in 2026 and beyond, compared to previous guidance of 1-1.2 GW a year |
| --- | --- |
Overview of Financial and Operating Results
Revenue
| ($ thousands) | For the three Months Ended | For the year Ended | ||
|---|---|---|---|---|
| Segment | 12/31/22 | 12/31/21 | 12/31/22 | 12/31/21 |
| Israel | 10,910 | 3,734 | 51,363 | 18,919 |
| Central-Eastern Europe | 18,206 | 20,656 | 70,705 | 61,326 |
| Western Europe | 27,706 | 7,539 | 58,991 | 14,064 |
| Management and construction | 4,047 | 3,108 | 11,113 | 8,152 |
| Total Revenues | 60,869 | 35,037 | 192,172 | 102,461 |
^2^ Pursuant to IFRS, if the government controls and regulates the licensing arrangements for a renewable energy facility and the license term is similar to the facility’s useful life, the facility is viewed, from an accounting perspective, as if it has been transferred to the government’s ownership. Although when evaluating our performance, such a project is like any other renewable energy project we own, from an accounting perspective, it is treated as “Financial Asset”, whereby we are considered strictly as a contractor during both the construction period and operating period.
2
For the fourth quarter of 2022, the Company’s revenues increased to $61m up from $35m in the same period in 2021. The growth was mainly driven by the addition of new projects, including Gecama, Emek Habacha and Selac, which contributed an additional $32m in the fourth quarter and the recognition of all proceeds from the sale of electricity by the Halutziot project as revenue following its reclassification out of Financial Asset, which contributed an additional $2m to revenue in the fourth quarter. These positive impacts were partially offset by lower production and non-recurring events which reduced availability of the facilities, which had a $6m impact, and weaker currency exchange rates (“FX”), which had a $3m impact. In addition, we sold $2m of electricity in projects treated as financial assets in the quarter, which under IFRS we are required to account for as financing income or other non-P&L metrics.
For the full year 2022, the Company’s revenues were $192m versus $102m in the full year 2021. The increase in revenue was mainly driven by the addition of new projects, which contributed an additional $86m, the reclassification of Halutziot, which contributed an additional $12m, and $2m from power purchase agreement (“PPA”) inflation indexation. These positive impacts were partially offset by lower production and certain events which reduced availability, that had an $8m impact and weaker FX which had a $6m impact. In addition, we sold $18m of electricity for projects treated as financial assets in 2022, which under IFRS we are required to account for as financing income or other non-P&L metrics.
The financial contribution of the Company’s segments is now well balanced between Western Europe, Central-Eastern Europe (“CEE”) and Israel, with 71% of revenues in the fourth quarter of 2022 denominated in Euros, 8% in other European currencies and 21% of revenues denominated in Israeli shekel. Following completion of the Company’s first project in the United States, which is expected to come online by the end of the first half of 2023, the Company’s revenue will also include substantial revenues denominated in U.S. dollars.
Adjusted EBITDA^*^
In the fourth quarter of 2022, the Company’s Adjusted EBITDA almost doubled to $43m compared to $22m for the same period in 2021. The increase was driven by the same factors which affected our revenue increase in the same period.
For the full year 2022, the Company’s Adjusted EBITDA also nearly doubled to $130m compared to $66m in 2021. The increase was driven by the same factors which affected our revenue increase in the same period and was offset by an additional $8m from corporate overhead expenses.
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Portfolio Overview^3^
The Company continues to accelerate the progress of its project portfolio through the conversion of Development Projects^4^ into Mature Projects and through the progression of Mature Projects from pre-construction to construction and ultimately operations.
Key changes to the Company’s projects portfolio compared to the third quarter of 2022
| • | 0.5 GW and 1.5 GWh commenced construction in the fourth quarter, including the following projects: Atrisco Solar and Solar + Storage 2. |
|---|---|
| • | 0.9 GW entered into pre-construction in the fourth quarter, including the following projects: Co Bar Phase 2 (from Advanced Development) and Rustic Hills 1 & 2 (from Contracted). |
| --- | --- |
| • | Overall, our Mature Project portfolio grew by 0.5 GW and 0.6 GWh, a 14% increase, driven by the addition of Co Bar Phase 2. |
| --- | --- |
| • | Increase in Advanced Development portfolio by 1.1 GW. |
| --- | --- |
United States
The Company is executing successfully across its US project portfolio. Focus continues to be progressing a large volume of projects to maturity through the development process.
Apex Solar (located in Montana) is progressing as planned. COD is expected by the end of the first half of 2023.
^3^ As of the Approval Date.
^4^ Development Projects comprise Advanced Development (projects which are expected to begin construction within 13 to 24 months of the Approval Date) and Development (the rest of the projects in the development process).
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Atrisco Solar (located in New Mexico and totaling 360 MW solar and 1,200 MWh storage) commenced construction during the fourth quarter 2022. Major equipment is ordered and the construction agreement executed. All interconnection studies are complete. The draft interconnection agreement is underway and expected to be signed in April. The Company is advancing negotiations with financing providers (debt and tax equity). There are strong potential benefits for Atrisco under the Inflation Reduction Act (IRA), including PTC on solar tax equity and the possibility of a domestic content adder on the energy storage system. COD is expected by mid-2024.
The Company has made significant progress on one of the largest projects in its portfolio, CO Bar (located in Arizona and totaling 1,200 MW solar and 824 MWh storage). The initial 580MW of solar is contracted and the remaining capacity including storage is in advanced negotiation with offtakers. The project has secured its primary real estate and conditional use permit (CUP). The system impact study (SIS) is complete and the facilities study is nearing completion. CO Bar is expected to start construction in the second half of 2023 and achieve COD in phases through 2025. Like Atrisco, the CO Bar project potentially stands to benefit from the IRA, including PTC on solar tax equity and the possibility of a domestic content adder on the battery energy storage system. There is further potential to contract an additional 3.2 GWh of storage at CO Bar in the future.
With respect to the supply chain, the Company continues to de-risk its project portfolio. The Company executed an agreement with Waaree for up to 2 GW of modules with delivery through 2025. Together with other module procurement contracts, the Company has clarity on meeting module supply needs for its mature project portfolio in the United States.
Amidst increasing interconnection queue congestion across the United States, the Company continues to see strong interconnection results, which it attributes to its advanced portfolio and market specific knowledge. In the fourth quarter of 2022, the Company increased the projects beyond system impact study (known interconnection cost and timeline) by approximately 2 GW. With more than 8.4 GW of projects past system impact study, the Company believes it is positioned to accelerate its growth in the United States.
Europe
The Company continues to benefit from the significant demand for power across Europe. Despite declining natural gas prices, natural gas remains significantly above historical price levels. Moreover, the steep increase in recent months in the price of carbon, recently eclipsing 100 Euros per ton, has kept thermal generation expensive. For example, in the fourth quarter of 2022, Gecama (Spain) benefited from an average net price of 115 EUR/MWh, 82% of which was hedged.
Project Bjorn (Sweden), one of the largest onshore wind farms in Europe, totaling 372 MW continues to progress with 26 turbines operational (out of 60) as of the date of this release. 52 turbines are fully erected. In Sweden, the Company is able to generate revenues from the sale of electricity for operational turbines even before the project reaches full COD. The Company expects Bjorn to reach full COD by the end of the first half of 2023.
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On the development front, Gecama Solar, a 250 MW solar and 200 MWh storage project advances as planned. With real estate and interconnection already secured, the project awaits its environmental and construction permit. Construction is expected to commence by the end of H2 2023 with COD expected by year end 2024.
Israel
In the fourth quarter the Company commenced construction on the project called Solar + Storage 2, totaling 163 MW and 328 MWh of storage. Negotiations of corporate power purchase agreements negotiations are ongoing with COD expected in 2024.
In addition, Genesis Wind, the largest renewable energy project in Israel totaling 189 MW has completed erection of all its wind turbines. Commissioning tests have begun with COD expected in the second half of 2023.
The Company also recently signed definitive agreements with NewMed Energy (TASE: MWND) and its CEO, Yossi Abu, to invest in renewable energy projects across the Middle East & North Africa. Although entering this agreement does not result in an immediate financial affect on the Company, the Company believes that there is a unique opportunity to develop attractive renewable energy projects of significant scale in the region, particularly across Egypt, Jordan and Morocco, which are markets adjacent to Enlight’s current geographic footprint (Israel and Spain).
Balance Sheet and Funding
The Company benefits from a strong liquidity position with the vast majority of its cash held in Euros or U.S. dollars. As of December 31, 2022, but including cash received in the U.S. IPO, 81% of the Company’s cash and cash equivalents was held in U.S. dollars or Euros, with a minimal exposure to the Israeli shekel. The Company has no exposure to Silicon Valley Bank.
| 12/31/2022 | ||
|---|---|---|
| ($ thousands) | Total | Pro Forma^5^ |
| Cash and Cash Equivalents: | ||
| Enlight Renewable Energy Ltd ,Enlight EU Energies Kft and Enlight Renewable LLC, excluding subsidiaries | 82,342 | 353,067 |
| Subsidiaries | 111,527 | 111,527 |
| Deposits: | ||
| Short term deposits | 4,054 | 4,054 |
| Restricted Cash: | ||
| Projects under construction | 92,103 | 92,103 |
| Reserves, including debt service, performance obligations and others | 38,728 | 38,728 |
| Total Cash | 328,754 | 599,479 |
| Financial assets at fair value through profit or loss* | 33,895 | 33,895 |
| Total Liquidity | 362,649 | 633,374 |
* Securities, largely government fixed income securities
Similarly, approximately 70% of the Company’s estimated Mature Project revenues are expected to be generated in U.S. dollars or Euros
^5^ Including the net proceeds from the IPO
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2023 Financial Outlook
“We are pleased to introduce Revenue and Adjusted EBITDA guidance for 2023 based on our current operational portfolio and expected conversions to operations over the course of the year. We note that our Revenue and Adjusted EBITDA guidance does not include certain proceeds from the sale of electricity for our projects treated as Financial Assets. Similarly, our Adjusted EBITDA outlook does not include tax credits expected to be recognized upon COD of Apex Solar. "We benefit as a well-capitalized and diversified group, and demand for renewable energy continues to increase globally,” said Nir Yehuda, Enlight Renewable Energy’s Chief Financial Officer.
| • | Revenue for fiscal year 2023 between $290m and $300m, |
|---|---|
| • | Adjusted EBITDA* for fiscal year 2023 between $188m and $198m |
| --- | --- |
| • | $15m proceeds from the sale of electricity with respect to projects treated as Financial Assets which are not recognized as revenue nor included in Adjusted EBITDA |
| --- | --- |
| • | 1,759 MW operational by year end 2023 |
| --- | --- |
* The section titled “Non-IFRS Financial Measures” below contains a description of Adjusted EBITDA, a non-IFRS financial measure discussed in this press release. A reconciliation between Adjusted EBITDA and Net Income, its most directly comparable IFRS financial measure, is contained in the tables below. The Company is unable to provide a reconciliation of Adjusted EBITDA to Net Income on a forward-looking basis without unreasonable effort because items that impact this IFRS financial measure are not within the Company’s control and/or cannot be reasonably predicted. These items may include, but are not limited to, forward-looking depreciation and amortization, share based compensation, U.S. acquisition expense, other income, finance income, finance expenses, share of losses of equity accounted investees and taxes on income. Such information may have a significant, and potentially unpredictable, impact on the Company’s future financial results. We note that “Adjusted EBITDA” measures that we disclosed in previous filings in Israel were not comparable to “Adjusted EBITDA” disclosed in the release and in our future filings.
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Conference Call Information
Enlight plans to hold its Fourth Quarter 2022 Conference Call and Webcast on Wednesday, March 15, 2023 at 8:00 a.m. ET to review its financial results and business outlook. Management will deliver prepared remarks followed by a question-and-answer session. Participants can join by conference call or webcast:
| • | Conference Call<br><br> <br>Please pre-register by conference call:<br><br> <br>https://register.vevent.com/register/BI6be483f1b52b4541a4c425933c76b2e3<br><br> <br>Upon registering, you will be emailed a dial-in number, direct passcode and unique PIN. |
|---|---|
| • | Webcast<br><br> <br>Please join and register by webcast: https://edge.media-server.com/mmc/p/yjzqcnph |
| --- | --- |
The press release with the financial results as well as the investor presentation materials will be accessible from the Company’s website prior to the conference call. Approximately one hour after completion of the live call, an archived version of the webcast will be available on the Company’s investor relations website at https://enlightenergy.co.il/info/investors/.
Supplemental Financial and Other Information
We intend to announce material information to the public through the Enlight investor relations website at https://enlightenergy.co.il/info/investors, SEC filings, press releases, public conference calls, and public webcasts. We use these channels to communicate with our investors, customers, and the public about our company, our offerings, and other issues. As such, we encourage investors, the media, and others to follow the channels listed above, and to review the information disclosed through such channels.
Any updates to the list of disclosure channels through which we will announce information will be posted on the investor relations page of our website.
Non-IFRS Financial Measures
This release presents Adjusted EBITDA, a non-IFRS financial metric, which is provided as a complement to the results provided in accordance with the International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”). A reconciliation of the non-IFRS financial information to the most directly comparable IFRS financial measure is provided in the accompanying tables found at the end of this release.
We define Adjusted EBITDA as Net Income adjusted for depreciation and amortization, share based compensation, U.S. acquisition expense, other income, finance income, finance expenses, share of losses of equity accounted investees and taxes on income. Our management believes Adjusted EBITDA is indicative of operational performance and ongoing profitability and uses Adjusted EBITDA to evaluate the operating performance and for planning and forecasting purposes.
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Non-IFRS financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for financial information presented under IFRS. There are a number of limitations related to the use of non-IFRS financial measures versus comparable financial measures determined under IFRS. For example, other companies in our industry may calculate the non-IFRS financial measures that we use differently or may use other measures to evaluate their performance. All of these limitations could reduce the usefulness of our non-IFRS financial measures as analytical tools. Investors are encouraged to review the related IFRS financial measure, Net Income, and the reconciliations of Adjusted EBITDA provided below to Net Income and to not rely on any single financial measure to evaluate our business.
Special Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements as contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements contained in this press release other than statements of historical fact, including, without limitation, statements regarding the Company’s business strategy and plans, capabilities of the Company’s project portfolio and achievement of operational objectives, market opportunity and potential growth, and the Company’s future financial results and Revenue, EBITDA, Adjusted EBITDA and proceeds from sale of electricity guidance are forward-looking statements. The words “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “target,” “seek,” “believe,” “estimate,” “predict,” “potential,” “continue,” “contemplate,” “possible,” “forecasts,” “aims” or the negative of these terms and similar expressions are intended to identify forward-looking statements, though not all forward-looking statements use these words or expressions.
These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the following: slowed demand for renewable energy projects; changes to existing renewable energy industry policies and regulations that present technical, regulatory and economic barriers to renewable energy projects; electricity price volatility, unusual weather conditions (including wind and solar conditions), catastrophic weather- related or other damage to facilities, unscheduled generation outages, maintenance or repairs, unanticipated changes to availability due to higher demand, shortages, transportation problems or other developments, environmental incidents, or electric transmission system constraints and the possibility that we may not have adequate insurance to cover losses as a result of such hazards; our ability to enter into new offtake contracts on acceptable terms and prices as current offtake contracts expire; actual or threatened health epidemics, such as the COVID-19 pandemic, and other outbreaks; operational delays and supply chain disruptions or increased costs of materials required for the construction of our projects, as well as cost overruns and delays related to disputes with construction contractors; the reduction, elimination or expiration of government incentives for, or regulations mandating the use of, renewable energy; our ability to effectively comply with Environmental Health and Safety and other laws and regulations and receive and maintain all necessary licenses, permits and authorizations; a drop in the price of electricity derived from the utility grid or from alternative energy sources; receipt of necessary land use, environmental, regulatory, construction and zoning permissions we need, on favorable terms; advances in technology that impair or eliminate the competitive advantage of our projects; the impact of adverse weather patterns and climate change; the requirements of being a public company the attending diversion of management’s attention; certain provisions in our articles of association and certain applicable regulations that may delay or prevent a change of control; and the other risk factors set forth in the section titled “Risk factors” in our prospectus dated February 13, 2023 filed with the Securities and Exchange Commission (the “SEC”) pursuant to Rule 424(b), and our other documents filed with or furnished to the SEC, including our Annual Report on Form 20-F for the fiscal year ended December 31, 2022, to be filed with the SEC.
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These statements reflect management’s current expectations regarding future events and operating performance and speak only as of the date of this press release. You should not put undue reliance on any forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that future results, levels of activity, performance and events and circumstances reflected in the forward-looking statements will be achieved or will occur. Except as required by applicable law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.
About Enlight
Founded in 2008, Enlight develops, finances, constructs, owns, and operates utility-scale renewable energy projects. Enlight operates across the three largest renewable segments today: solar, wind and energy storage. A global platform, Enlight operates in the United States, Israel and 9 European countries. Enlight has been traded on the Tel Aviv Stock Exchange since 2010 (TASE: ENLT) and completed its US IPO (Nasdaq: ENLT) in 2023.
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Appendix 1 - Consolidated statements of financial position
Consolidated Statements of Financial Position as of December 31
| 2022 | 2021 | |
|---|---|---|
| in | in | |
| thousands | thousands | |
| (Unaudited) | (Audited) | |
| Assets | ||
| Current assets | ||
| Cash and cash equivalents | ||
| Deposits in banks | ||
| Restricted cash | ||
| Financial assets at fair value through profit or loss | ||
| Trade receivables | ||
| Other receivables | ||
| Current maturities of contract assets | ||
| Current maturities of loans to investee entities | ||
| Other financial assets | ||
| Total current assets | ||
| Non-current assets | ||
| Restricted cash | ||
| Other long term receivables | ||
| Deferred costs in respect of projects | ||
| Deferred borrowing costs | ||
| Loans to investee entities | ||
| Contract assets | ||
| Fixed assets, net | ||
| Intangible assets, net | ||
| Deferred taxes | ||
| Right-of-use asset, net | ||
| Financial assets at fair value through profit or loss | ||
| Other financial assets | ||
| Total non-current assets | ||
| Total assets |
All values are in US Dollars.
11
Consolidated Statements of Financial Position as of December 31 (Cont.)
| 2022 | 2021 | |||
|---|---|---|---|---|
| in | in | |||
| thousands | thousands | |||
| (Unaudited) | (Audited) | |||
| Liabilities and equity | ||||
| Current liabilities | ||||
| Credit and current maturities of loans from | ||||
| banks and other financial institutions | ||||
| Trade payables | ||||
| Other payables | ||||
| Current maturities of debentures | ||||
| Current maturities of lease liability | ||||
| Financial liabilities through profit or loss | ||||
| Other financial liabilities | ||||
| Total current liabilities | ||||
| Non-current liabilities | ||||
| Debentures | ||||
| Convertible debentures | ||||
| Loans from banks and other financial institutions | ||||
| Loans from non-controlling interests | ||||
| Financial liabilities through profit or loss | ||||
| Other financial liabilities | ||||
| Deferred taxes | ||||
| Other long term payables | ||||
| Employee benefits | ||||
| Lease liability | ||||
| Asset retirement obligation | ||||
| Total non-current liabilities | ||||
| Total liabilities | ||||
| Equity | ||||
| Ordinary share capital | ||||
| Share premium | ||||
| Capital reserves | ) | |||
| Proceeds on account of convertible options | ||||
| Accumulated loss | ) | ) | ||
| Equity attributable to shareholders of the Company | ||||
| Non-controlling interests | ||||
| Total equity | ||||
| Total liabilities and equity |
All values are in US Dollars.
12
Consolidated Statements of Income
| 2021 | |||
| in | |||
| thousands | |||
| (Audited) | |||
| Revenues | |||
| Cost of sales | ) | ) | |
| Depreciation and amortization | ) | ) | |
| Gross profit | |||
| General and administrative expenses | ) | ) | |
| Development expenses | ) | ) | |
| Transaction costs in respect of acquisition of | |||
| activity in the United States | ) | ||
| Other income | |||
| ) | ) | ||
| Operating profit | |||
| Finance income | |||
| Finance expenses | ) | ) | |
| Total finance expenses, net | ) | ) | |
| Profit before tax and equity loss | |||
| Share of loss of equity accounted investees | ) | ) | |
| Profit before income taxes | |||
| Taxes on income | ) | ) | |
| Profit for the year | |||
| Profit for the year attributed to: | |||
| Owners of the Company | |||
| Non-controlling interests | |||
| Earnings per ordinary share (in ) with a par | |||
| value of NIS 0.1, attributable to owners of the | |||
| parent Company: | |||
| Basic earnings per share | |||
| Diluted earnings per share | |||
| Weighted average of share capital used in the | |||
| calculation of earnings: | |||
| Basic per share | |||
| Diluted per share |
All values are in US Dollars.
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Consolidated Statements of Cash Flows
| For the year ended December 31 | ||||
|---|---|---|---|---|
| 2022 | 2021 | |||
| in | in | |||
| Thousands | Thousands | |||
| (Unaudited) | (Audited) | |||
| Cash flows for operating activities | ||||
| Profit for the year | ||||
| Adjustments required to present cash flows from operating | ||||
| activities (Annex A) | ||||
| Cash from operating activities | ||||
| Interest receipts | ||||
| Interest paid | ) | ) | ||
| Income Tax paid | ) | ) | ||
| Repayment of contract assets | ||||
| Net cash from operating activities | ||||
| Cash flows for investing activities | ||||
| Acquisition of consolidated companies | ) | ) | ||
| Restricted cash, net | ) | |||
| Purchase, development and construction of fixed assets | ) | ) | ||
| Investment in deferred costs in respect of projects | ) | ) | ||
| Proceeds from sale (purchase) of short term financial assets | ||||
| measured at fair value through profit or loss, net | ) | ) | ||
| Investments in bank deposits | ) | |||
| Payments on account of acquisition of consolidated company | ) | ) | ||
| Loans to investee | ) | ) | ||
| Investment in investee | ) | ) | ||
| Loans to non-controlling interests | ) | |||
| Purchase of long term financial assets measured at fair value | ||||
| through profit or loss | ) | ) | ||
| Net cash used in investing activities | ) | ) |
All values are in US Dollars.
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Consolidated Statements of Cash Flows (Cont.)
| For the year ended December 31 | ||||
|---|---|---|---|---|
| 2022 | 2021 | |||
| in | in | |||
| Thousands | Thousands | |||
| (Unaudited) | (Audited) | |||
| Cash flows from financing activities | ||||
| Receipt of loans from banks and other financial institutions | ||||
| Repayment of loans from banks and other financial institutions | ) | ) | ||
| Issuance of debentures | ||||
| Issuance of convertible debentures | ||||
| Repayment of debentures | ) | ) | ||
| Dividends and distributions by subsidiaries to non-controlling | ||||
| interests | ) | ) | ||
| Proceeds from settlement of derivatives | ||||
| Deferred borrowing costs | ) | ) | ||
| Receipt of loans from non-controlling interests | ) | |||
| Repayment of loans from non-controlling interests | ) | |||
| Issuance of shares | ||||
| Exercise of share options | ||||
| Repayment of lease liability | ) | ) | ||
| Proceeds from investment in entities by non-controlling | ||||
| interest | ||||
| Net cash from financing activities | ||||
| Increase (decrease) in cash and cash equivalents | ) | |||
| Balance of cash and cash equivalents at beginning of year | ||||
| Effect of exchange rate fluctuations on cash and cash | ||||
| equivalents | ) | |||
| Cash and cash equivalents at end of year |
All values are in US Dollars.
15
Consolidated Statements of Cash Flows (Cont.)
| For the year ended December 31 | ||||
|---|---|---|---|---|
| 2022 | 2021 | |||
| in | in | |||
| Thousands | Thousands | |||
| (Unaudited) | (Audited) | |||
| Annex A - Adjustments Required to Present Cash Flows From | ||||
| operating activities: | ||||
| Income and expenses not associated with cash flows: | ||||
| Depreciation and amortization | ||||
| Finance expenses in respect of debentures | ||||
| Finance expenses in respect of project finance loans | ||||
| Finance expenses in respect of loans from non-controlling | ||||
| interests | ||||
| Finance expenses in respect of contingent consideration | ) | |||
| Interest income from deposits | ) | |||
| Fair value changes of financial instruments measured at fair | ||||
| value through profit or loss | ) | ) | ||
| Share-based compensation | ||||
| Deferred taxes | ||||
| Finance expenses in respect of lease liability | ||||
| Finance income in respect of contract asset | ) | ) | ||
| Exchange rate differences and others | ) | |||
| Amortization of deferred costs in respect of projects | ||||
| Interest incomes from loans to investees | ) | ) | ||
| Company’s share in losses of investee partnerships | ||||
| Finance expenses (income) in respect of forward transaction | ) | |||
| Changes in assets and liabilities items: | ||||
| Change in other receivables | ) | |||
| Change in trade receivables | ) | ) | ||
| Change in other payables | ) | |||
| Change in trade payables | ||||
| Change in provisions for employees benefits | ||||
| ) | ) | |||
All values are in US Dollars.
16
Segmental Reporting
| For the year ended December 31, 2022 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Israel | Central-<br><br> <br>Eastern<br><br> <br>Europe | Western<br><br> <br>Europe | Management<br><br> <br>and<br><br> <br>construction | Total<br><br> <br>reportable<br><br> <br>segments | Adjustments | Total | |||||||||
| in thousands | |||||||||||||||
| (Unaudited) | |||||||||||||||
| External revenues | 70,705 | 58,991 | 11,113 | 192,172 | - | 192,172 | |||||||||
| Inter-segment revenues | - | - | 9,111 | 9,111 | (9,111 | ) | - | ||||||||
| Total revenues | 70,705 | 58,991 | 20,224 | 201,283 | (9,111 | ) | 192,172 | ||||||||
| Segment Adjusted | |||||||||||||||
| EBITDA | 56,181 | 45,750 | 4,018 | 163,547 | - | 163,547 | |||||||||
| Reconciliations of unallocated amounts: | |||||||||||||||
| Headquarter costs (*) | (18,071 | ) | |||||||||||||
| Intersegment profit | 2,037 | ||||||||||||||
| Repayment of contract asset under concession arrangements | (17,578 | ) | |||||||||||||
| Depreciation and amortization and share based compensation | (50,940 | ) | |||||||||||||
| Other incomes not attributed to segments | 11,617 | ||||||||||||||
| Operating profit | 90,612 | ||||||||||||||
| Finance income | 23,341 | ||||||||||||||
| Finance expenses | (62,591 | ) | |||||||||||||
| Share in the losses of equity accounted investees | (306 | ) | |||||||||||||
| Profit before income taxes | 51,056 |
All values are in US Dollars.
| (*) | Including general and administrative, project promotion and development expenses (excluding depreciation and amortization and share based compensation). |
|---|
17
Segmental Reporting (cont.)
| For the year ended December 31, 2021 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Israel | Central-<br><br> <br>Eastern<br><br> <br>Europe | Western<br><br> <br>Europe | Management<br><br> <br>and<br><br> <br>construction | Total<br><br> <br>reportable<br><br> <br>segments | Adjustments | Total | |||||||||
| in thousands | |||||||||||||||
| (Unaudited) | |||||||||||||||
| External revenues | 61,326 | 14,064 | 8,152 | 102,461 | - | 102,461 | |||||||||
| Inter-segment revenues | - | - | 10,894 | 10,894 | (10,894 | ) | - | ||||||||
| Total revenues | 61,326 | 14,064 | 19,046 | 113,355 | (10,894 | ) | 102,461 | ||||||||
| Segment Adjusted | |||||||||||||||
| EBITDA | 51,610 | 11,183 | 6,623 | 113,965 | - | 113,965 | |||||||||
| Reconciliations of unallocated amounts: | |||||||||||||||
| Headquarter costs (*) | (12,086 | ) | |||||||||||||
| Intersegment profit | (2,811 | ) | |||||||||||||
| Repayment of contract asset under concession arrangements | (32,857 | ) | |||||||||||||
| Depreciation and amortization and share based compensation | (24,480 | ) | |||||||||||||
| U.S. acquisition expense | (7,331 | ) | |||||||||||||
| Operating profit | 34,400 | ||||||||||||||
| Finance income | 30,333 | ||||||||||||||
| Finance expenses | (37,175 | ) | |||||||||||||
| Share in the losses of equity accounted investees | (189 | ) | |||||||||||||
| Profit before income taxes | 27,369 |
All values are in US Dollars.
| (*) | Including general and administrative, project promotion and development expenses (excluding depreciation and amortization and share based compensation). |
|---|
18
Appendix 2 - Reconciliations between Net income to Adjusted EBITDA
| ($ thousands) | For the three month period ended | For the Year Ended | ||
|---|---|---|---|---|
| 12/31/22 | 12/31/21 | 12/31/22 | 12/31/21 | |
| Net Income | 10,955 | 8,116 | 38,113 | 21,675 |
| Depreciation and amortization | 13,454 | 6,331 | 42,267 | 20,500 |
| Share based compensation | 1,140 | 2,166 | 8,673 | 3,980 |
| U.S. acquisition expense | 0 | 341 | 0 | 7,331 |
| Other income expenses* | 5,846 | 0 | (11,617) | 0 |
| Finance income | (4,160) | (7,436) | (23,341) | (30,333) |
| Finance expenses | 12,126 | 8,859 | 62,591 | 37,175 |
| Share of losses of equity accounted investees | 234 | 50 | 306 | 189 |
| Taxes on income | 3,619 | 3,275 | 12,943 | 5,694 |
| Adjusted EBITDA | 43,214 | 21,702 | 129,935 | 66,211 |
* One time (Income) expenses is largely comprised of movements in the expected earnout for the Clenera acquisition
19
Appendix 3 - Mature Projects: 4.5 GW operational by 2025
Operational MW Over Time
20
Appendix 4 - Mature Projects information
| a) | Segment information: Operational projects | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| ( thousands) | Twelve Months ended December 31, 2022 | 3 Months ended December 31 | |||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Operational Project Segments | Generation<br><br> (GWh) | Reported Revenue* | Segment Adjusted<br><br> EBITDA | Generation<br><br> (GWh) | Reported Revenue | Segment Adjusted<br><br> EBITDA | |||
| 2021 | 2022 | 2021 | 2022 | 2021 | 2022 | ||||
| Israel | 478 | 51,363 | 57,598 | 51 | 98 | 3,734* | 10,910* | 7,410 | 9,608 |
| Western Europe | 682 | 58,991 | 45,750 | 103 | 292 | 7,539 | 27,706 | 6,271 | 23,618 |
| Central & Eastern Europe | 718 | 70,705 | 56,181 | 191 | 184 | 20,656 | 18,206 | 17,751 | 14,085 |
| Total Consolidated | 1,878 | 181,059 | 159,529 | 345 | 574 | 31,929 | 56,822 | 31,432 | 47,311 |
| Unconsolidated at share | |||||||||
| Total |
All values are in US Dollars.
| Total Consolidated Q4 2022 Segment Adjusted EBITDA for Israel, Western Europe and Central & Eastern Europe | 47,311 |
|---|---|
| Less: Q4 2022 Segment Adjusted EBITDA for projects that were not fully operational in Q4 2022 | (1,142) |
| Annualized Q4 2022 Consolidated Segment Adjusted EBITDA (“Annualized EBITDA”)** | 184,676 |
| Invested Capital for Consolidated Projects that were Fully Operational as of October 1, 2022 (“Invested Capital”)*** | 1,600,000 |
| Annualized EBITDA / Invested Capital | 11.5% |
* We generated $2m of proceeds from the sale of electricity in Israel under long term PPAs which are not recognized as revenue or included in Adjusted EBITDA (projects treated as Financial Assets) for the fourth quarter ended December 31, 2022 and $18m for the twelve months ended December 31, 2022.
** We use an annualized total amount of Segment Adjusted EBITDA given the rapid growth of our Operational Projects between quarters in 2022, which resulted in rapid growth in our Segment Adjusted EBITDA in between quarters. In addition, our geographic and technological diversity substantially mitigates any seasonal effects.
*** Invested capital in a project reflects the total cost we incurred to complete the development and construction of such project.
21
| b) | Operational projects that have been operational for less than a full year | |||
|---|---|---|---|---|
| ( thousands) | Twelve Months ended December 31, 2022 | 3 Months ended December 31 | ||
| --- | --- | --- | --- | --- |
| Consolidated Projects | Generation<br><br> (GWh) | Reported Revenue | Generation<br><br> (GWh) | Reported Revenue |
| Gecama<br> (Full COD August '22) | 337 | 43,512 | 188 | 22,843 |
| Bjorn<br> (Initial COD October '22)* | 18 | 1,281 | 18 | 1,282 |
| Emek Habacha<br> (COD April '22) | 199 | 21,242 | 49 | 5,153 |
All values are in US Dollars.
* Full COD expected by end of Q2 2023. 11 turbines operational as of December 31,2022; 26 turbines operational as of the date of this release (out of a total of 60 turbines)
22
| c) | Projects under construction | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Consolidated Projects<br><br> <br>($ millions)* | Country | Generation Capacity<br><br> (MW) | Storage<br><br> Capacity<br><br> (MWh) | Est.<br><br> COD | Est. Total<br><br> Project Cost | Capital Invested as of Dec. 31, 2022 | Est. Equity Required (%) | Equity Invested as of Dec. 31, 2022 | Est. Tax Equity (% of project cost)** | Est. First Full Year Revenue | Est. First Full Year EBITDA*** |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Apex Solar | United States | 105 | - | H1 2023 | 123-129 | 76 | 10% | - | 90% | 11-12 | 8 |
| Atrisco Solar | United States | 360 | 1,200 | H1 2024 | 824-866 | 67 | 15% | 67 | 55% | 51-53 | 43-45 |
| Genesis Wind | Israel | 189 | - | H2 2023 | 355 | 340 | 15% | 53 | N/A | 51-53 | 40-42 |
| Solar+Storage Cluster 1 | Israel | 89 | 155 | H1 2024 | 125-131 | 107 | 25% | 107 | N/A | 11 | 7 |
| Solar+Storage Cluster 2 | Israel | 163 | 328 | H2 2024 | 201-212 | 13 | - | 13 | N/A | 39-41 | 16-17 |
| AC/DC | Hungary | 26 | - | H2 2023 | 23-24 | 16 | 30% | 16 | N/A | 2 | 2 |
| Total Consolidated | 932 | 1,683 | 1,651-1,717 | 619 | 256 | 165-172 | 116-121 | ||||
| Unconsolidated at share | Israel | 19 | - | H1 2024 | 35-37 | - | - | - | N/A | 3 | 3 |
| Total | 951 | 1,683 | 1,686-1,754 | 619 | 256 | 168-175 | 119-124 |
* For projects not located in the United States, the conversion into U.S. dollars was based on foreign exchange rates as of the date of the financial statements (December 31, 2022)
** Total tax equity investment anticipated as a percentage of total project costs
*** EBITDA does not include recognition of PTC or ITC tax credits. EBITDA is a non-IFRS financial measure. The Company is unable to provide a reconciliation of EBITDA to Net Income on a forward-looking basis without unreasonable effort because items that impact this IFRS financial measure are not within the Company’s control and/or cannot be reasonably predicted.
23
| d) | Pre-Construction Projects (due to commence construction within 12 months of the Approval Date) | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Major Projects<br><br> <br>($ millions)* | Country | Generation Capacity<br><br> (MW) | Storage<br><br> Capacity<br><br> (MWh) | Est.<br><br> COD | Est. Total<br><br> Project Cost | Capital Invested as of Dec. 31, 2022 | Est. Equity Required (%) | Equity Invested as of Dec. 31, 2022 | Est. Tax Equity (% of project cost)** | Est. First Full Year Revenue | Est. First Full Year EBITDA*** |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| CoBar Complex | United<br><br> <br>States | 1,200 | 824<br><br> <br>(3.2 GWh<br><br> <br>additional<br><br> <br>potential) | 2025 | 1,529-1,607 | 8 | 15% | 8 | 48% | 96-102 | 75-79 |
| Rustic Hills 1&2 | United<br><br> <br>States | 256 | - | H1<br><br> <br>2025 | 284-298 | 3 | 15% | 3 | 53% | 16-17 | 13-14 |
| Gecama Solar | Spain | 250 | 200 | H2<br><br> <br>2024 | 234-246 | 1 | 50% | 1 | N/A | 36-38 | 30-32 |
| Other Projects<br><br> <br>($ millions)* | MW Deployment | Storage<br><br> Capacity<br><br> (MWh) | Est. Total<br><br> Project Cost | Capital Invested as of Dec. 31, 2022 | Est. Equity Required (%) | Equity Invested as of Dec. 31, 2022 | Est. Tax Equity (% of project cost)** | Est. First Full Year Revenue | Est. First Full Year EBITDA*** | ||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 2023 | 2024 | 2025 | |||||||||
| United States | - | - | 305 | - | 354-372 | 9 | 25%-30% | 9 | 40%-45% | 22-23 | 16-17 |
| CEE | - | 60 | - | - | 47-49 | 4 | 35% | 4 | N/A | 8 | 7 |
| Israel | 18 | - | 38 | - | 69-73 | 3 | 25% | 3 | N/A | 8-9 | 6 |
| Total Consolidated | 18 | 60 | 343 | - | 470-494 | 16 | - | 16 | - | 38-40 | 29-30 |
| Unconsolidated at share | - | - | 32 | - | 39-41 | 2 | 30% | 2 | N/A | 6 | 5 |
| Total | 18 | 60 | 375 | - | 509-535 | 18 | - | 18 | - | 44-46 | 33-35 |
| Total Pre-Construction | 2,159 | MW | 1,024 | MWh | 2,556-2,686 | 30 | 30 | 192-203 | 152-160 |
* For projects not located in the United States, the conversion into U.S. dollars was based on foreign exchange rates as of the date of the financial statements (December 31, 2022)
** Total tax equity investment anticipated as a percentage of total project costs
*** EBITDA does not include recognition of PTC or ITC tax credits. EBITDA is a non-IFRS financial measure. The Company is unable to provide a reconciliation of EBITDA to Net Income on a forward-looking basis without unreasonable effort because items that impact this IFRS financial measure are not within the Company’s control and/or cannot be reasonably predicted
24
Appendix 5 – Functional Currency Conversion Rates:
The financial statements of each of the Company’s subsidiaries were prepared in the currency of the main economic environment in which it operates (hereinafter: the “Functional Currency”). For the purpose of consolidating the financial statements, results and financial position of each of the Group’s member companies are translated into the Israeli shekel (“NIS”), which is the Company’s Functional Currency. The Group’s consolidated financial statements are presented in U.S. dollars (“USD”)..
FX Rates to USD:
| Date of the financial statements: | Euro | NIS |
|---|---|---|
| As of December 31, 2022 | 1.07 | 0.28 |
| As of December 31, 2021 | 1.13 | 0.32 |
| Average for the 12 months period ended: | ||
| December 31, 2022 | 1.05 | 0.30 |
| --- | --- | --- |
| December 31, 2021 | 1.18 | 0.31 |
| Average for the 3 months period ended: | ||
| December 31, 2022 | 1.02 | 0.29 |
| --- | --- | --- |
| December 31, 2021 | 1.13 | 0.32 |
25