TIDMOPG
RNS Number : 9923X
OPG Power Ventures plc
28 February 2017
28(th) February 2017
OPG Power Ventures plc
("OPG", the "Group" or the "Company")
Trading update for Q3 FY17
Operational resilience, dividend payment and a new debt
repayment schedule for Gujarat
OPG (AIM: OPG), the developer and operator of power generation
plants in India, announces its trading update for the quarter and
the nine months ended 31(st) December 2016 ("Q3 FY17").
Highlights
-- Maiden interim dividend paid;
-- New debt repayment schedule for Gujarat - maturity extended
by 10 years resulting in a total GBP67 million reduction in
principal repayments through FY17- FY21, interest rate
unchanged;
-- Generation 3.4 billion units up 53% on corresponding nine month period in the prior year;
-- Average load factor expectation for FY17 unchanged - Chennai 76% and Gujarat 65%;
-- Average tariff billed for nine months - Rs 5.33/kWh at Chennai and Rs 3.89/kWh at Gujarat; and
-- 62 MW Karnataka solar project - debt financing secured for 40
MW, land being acquired, EPC shortlisted - on track for
commissioning in 2017.
Arvind Gupta, Chairman, commented:
"Our business model has demonstrated its operational resilience
and competitive position and we are particularly pleased to have
paid our first interim dividend whilst continuing to make debt
repayments and progressing our renewables program. The new debt
schedule at Gujarat should give us further balance sheet
flexibility as we continue to focus on maximising our assets."
For further information, please visit www.opgpower.com or
contact:
OPG Power Ventures PLC
Arvind Gupta / V Narayan +91 (0) 44 429
Swami 11211
OPG Power Ventures PLC -
Investor Relations +44 (0) 20 7850
Ajay Paliwal / Pooja Maru 7070
Cenkos Securities (Nominated
Adviser & Broker) +44 (0) 20 7397
Stephen Keys / Camilla Hume 8900
Macquarie Capital (Europe)
Limited (Joint Broker) +44 (0) 20 3037
Raj Khatri / Nick Stamp 2000
Tavistock (Financial PR)
Simon Hudson / Barney Hayward +44 (0) 20 7920
/ James Collins 3150
OPG operates and develops power generation related assets in
India and at 30(th) September 2016 had 750 MW of assets with a
further 186 MW under development or in the pipeline. In the six
months ended 30(th) September 2016, according to its unaudited
results for the period, the Company generated revenues of GBP118
million, EBITDA of GBP42 million and profit before tax of GBP18
million.
Operations Summary
Q3 Q3 Nine Nine Full
FY17 FY16 months months Year
FY17 FY16 FY16
----------------------------- ------ ------ -------- -------- ---------
Generation (million kWh)
----------------------------- ------ ------ -------- -------- ---------
414 MW Chennai 537 537 1,757 1,595 2,236
----------------------------- ------ ------ -------- -------- ---------
300 MW Gujarat 428 282 1,359 620 927(1)
----------------------------- ------ ------ -------- -------- ---------
Generation (MU) excluding
auxiliary 1,056 819 3,116 2,215 3,163
----------------------------- ------ ------ -------- -------- ---------
Additional "deemed" offtake
at Chennai 78 269 184
----------------------------- ------ ------ -------- -------- ---------
Total Generation (MUe)(2) 1,143 819 3,385 2,215 3,347
----------------------------- ------ ------ -------- -------- ---------
Reported Average PLF
(%)(3)
----------------------------- ------ ------ -------- -------- ---------
414 MW Chennai 67% 59% 74% 72% 78%
----------------------------- ------ ------ -------- -------- ---------
300 MW Gujarat 64% N/A N/A N/A 52%
----------------------------- ------ ------ -------- -------- ---------
Note:
1. Includes 704 million units generated until January 2016 from
Gujarat for which results were capitalised
2. MU - millions units or kWh; MUe - millions units or kWH of
equivalent power
3. Reported Average PLF based on MUe
Chennai generation 27% ahead of last year notwithstanding
one-off events; PLF on track for 76%
As reported on 26(th) January 2017, the Company was able to
limit the financial impact of recent one off events towards the end
of last year, which included a cyclone and a near commercial
shutdown of the region following the unfortunate death of the Chief
Minister, to approximately GBP6 million in revenues.
Notwithstanding these issues, volumes were steady between Q3 FY17
and the comparable quarter last year, with year to date volumes
significantly ahead. For January 2017, our reportable PLF was 73%
and we continue to expect to achieve a reported average load factor
of 76% at Chennai for FY17 as a whole.
Gujarat generation 119% higher than last year; PLF on track for
65%
The Gujarat plant ramped up, achieving an average PLF of 65% in
Q3 FY17. Generation was 428 million units in the quarter and
approximately 1.4 billion units in the period to date. This is
considerably higher than last year and is principally on account of
the plant's full commissioning being in January 2016. Due to the
demand and supply dynamic in Gujarat, and as referred to in our
interim FY17 results, there have been continuing delays in paying
over to us amounts collected from customers by state electricity
companies. As a result, the Group's strategy has been to focus on
procuring additional contracts outside the State with the objective
of achieving the right balance between growing our volumes and
profitability on each sale. The Company is still expected to
achieve a PLF of 65% for the current year and remains confident of
increasing this next year.
At both our plants, customer diversity has helped to mitigate
any significant impact to date from demonetisation and the general
consensus remains for this event to result in significantly more
activity and growth across all sectors of the Indian economy in the
future.
Coal
Benchmark international coal prices continued to soften during
Q3 following the spike in H1 FY2017 that the Company previously
reported. With some volatility at the beginning of CY2017,
consensus expectations are for a further decline in prices
throughout the rest of 2017 and into 2018. The Company has already
completed its coal purchases for FY17.
Gujarat new debt repayment schedule
The Company has negotiated a new, extended debt repayment
schedule with its lenders for its INR 1.5 billion (GBP179.2
million) project debt at Gujarat to better match operating cash
flows. The total remaining duration of the facility will be
extended from 9 to 19.5 years with the final repayment due in 2036
and the following is a summary of the new repayment schedule:
Period Previous
repayment New repayment
schedule schedule
------------- ------------ ---- -------------- ----
GBP million % GBP million %
------------- ------------ ---- -------------- ----
FY17 - FY
21 80.64 45 14.01 8
------------- ------------ ---- -------------- ----
FY22 - FY26 89.60 50 58.35 33
------------- ------------ ---- -------------- ----
FY27 - FY36 8.96 5 106.84 59
------------- ------------ ---- -------------- ----
Total 179.20 100 179.20 100
------------- ------------ ---- -------------- ----
Note: GBP1 = INR 83.5
Accordingly, the total principal amounts to be repaid between
FY17 and FY21 are being reduced by GBP67 million.
The debt is to remain at an unchanged variable rate of interest
and on the existing security.
A closer relationship between debt repayments and expected
performance of Gujarat
It is expected that the new schedule of repayments will better
reflect the cash generation and maximisation of this plant, which
is expected to be a function of the following factors:
- continuing to target load factors at or above 80 per cent,
rising from the 70-75 per cent that OPG expects to achieve next
year, all well above national average;
- continuing to target higher tariff industrial customers, especially outside the state;
- preserving sales relationships that contribute to fixed cost,
and re-emphasising focus on profitability on each sale; and
- Gujarat state electricity board companies paying over to the
Company, as referred to in the FY17 interim results, amounts
collected from customers located in the state and doing so on
time.
One year since commissioning, the Gujarat plant is achieving
better load factors than many thermal power plants in the country
and has already developed a diverse industrial customer base in
Gujarat and other states. The Company believes there is the ability
to further diversify the customer base and that the new debt
repayment schedule at this plant will facilitate achieving this
through the provision of increased financial flexibility over the
coming years.
Solar projects
62 MW Karnataka
The Company has already secured debt financing for 40 MW of its
62 MW solar project development in Karnataka. Against the 25 year
PPA, debt is to be repayable over 17 years and carry a variable
rate of interest. In addition, the Company has received approval
for transmission of power from the sites that it is currently in
negotiation to secure. The project is on track for commissioning in
2017.
124 MW Jharkhand
The Company has been issued with a letter of award confirming
that OPG has secured a 25 year PPA for this project at the terms we
bid. The land has been identified along with potential debt
providers such that when OPG receives the signed PPA from the state
government financial closure could be achieved soon afterwards.
Outlook
The Company expects the current year's results to be in line
with consensus expectations. In addition, a new debt repayment
schedule at Gujarat is expected to reduce principal repayments over
the next few years from FY18 and better match repayments with asset
performance.
The long term proposition remains unchanged - the Group
continues to demonstrate its operational resilience and the Board
is pursuing its strategy of maximising our assets, paying dividends
and investing with a view to growing earnings.
This information is provided by RNS
The company news service from the London Stock Exchange
END
TSTLFFFIFIIDFID
(END) Dow Jones Newswires
February 28, 2017 02:01 ET (07:01 GMT)
Opg Power Ventures (LSE:OPG)
Historical Stock Chart
From Apr 2024 to May 2024
Opg Power Ventures (LSE:OPG)
Historical Stock Chart
From May 2023 to May 2024