Exhibit 99.2
Unaudited Financial Information for the Three Months and Nine Months Ended September 30, 2020 of Kenon and
OPC and Reconciliation of Certain non-IFRS Financial Information
Table of Contents
Summary Kenon consolidated financial information
Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Financial Position as of September 30, 2020 and December 31, 2019
Consolidated Statement of Financial Position as of September 30, 2020 and December 31, 2019
As of September 30, | As of December 31, | |||||||
2020 | 2019 | |||||||
$ millions | ||||||||
Current assets | ||||||||
Cash and cash equivalents | 432 | 147 | ||||||
Short-term deposits and restricted cash | 16 | 33 | ||||||
Trade receivables | 33 | 39 | ||||||
Short-term derivative instruments | 1 | - | ||||||
Other current assets | 19 | 40 | ||||||
Asset held for sale | - | 70 | ||||||
Total current assets | 501 | 329 | ||||||
Non-current assets | ||||||||
Investments in associated companies | 137 | 120 | ||||||
Long-term investment | 230 | - | ||||||
Long-term deposits and restricted cash | 100 | 77 | ||||||
Other non-current assets | 39 | 88 | ||||||
Long-term derivative instruments | 1 | 2 | ||||||
Deferred payment receivable | 217 | 204 | ||||||
Deferred taxes, net | 3 | 2 | ||||||
Property, plant and equipment, net | 720 | 668 | ||||||
Intangible assets, net | 1 | 1 | ||||||
Right-of-use assets, net | 84 | 17 | ||||||
Total non-current assets | 1,532 | 1,179 | ||||||
Total assets | 2,033 | 1,508 | ||||||
Current liabilities | ||||||||
Current maturities of loans from banks and others | 48 | 46 | ||||||
Short-term derivative instruments | 7 | 6 | ||||||
Current tax liabilities | 10 | - | ||||||
Trade and other payables | 68 | 52 | ||||||
Current maturities of lease liabilities | 16 | 1 | ||||||
Total current liabilities | 149 | 105 | ||||||
Non-current liabilities | ||||||||
Long-term loans from banks and others | 533 | 504 | ||||||
Debentures | 181 | 73 | ||||||
Deferred taxes, net | 80 | 79 | ||||||
Non-current tax liabilities | 31 | 29 | ||||||
Other non-current liabilities | - | 1 | ||||||
Long-term derivative instruments | 8 | - | ||||||
Long-term lease liabilities | 5 | 5 | ||||||
Total non-current liabilities | 838 | 691 | ||||||
Total liabilities | 987 | 796 | ||||||
Equity | ||||||||
Share capital | 602 | 602 | ||||||
Translation reserve | (2 | ) | 18 | |||||
Capital reserve | 5 | 14 | ||||||
Accumulated profit/(loss) | 355 | (11 | ) | |||||
Equity attributable to owners of the Company | 960 | 623 | ||||||
Non-controlling interests | 86 | 89 | ||||||
Total equity | 1,046 | 712 | ||||||
Total liabilities and equity | 2,033 | 1,508 |
Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Profit & Loss
Consolidated Statement of Profit & Loss
For the nine months ended September 30, | For the three months ended September 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
$ millions | $ millions | |||||||||||||||
Revenue | 282 | 284 | 117 | 102 | ||||||||||||
Cost of sales and services (excluding depreciation and amortization) | (202 | ) | (195 | ) | (84 | ) | (69 | ) | ||||||||
Depreciation | (23 | ) | (23 | ) | (9 | ) | (8 | ) | ||||||||
Gross profit | 57 | 66 | 24 | 25 | ||||||||||||
Selling, general and administrative expenses | (28 | ) | (25 | ) | (10 | ) | (7 | ) | ||||||||
Other income | 2 | 6 | 1 | 5 | ||||||||||||
Operating profit | 31 | 47 | 15 | 23 | ||||||||||||
Financing expenses | (24 | ) | (22 | ) | (11 | ) | (6 | ) | ||||||||
Financing income | 13 | 14 | 5 | 5 | ||||||||||||
Financing expenses, net | (11 | ) | (8 | ) | (6 | ) | (1 | ) | ||||||||
Net gains/(losses) related to changes of interest in Qoros | 304 | (11 | ) | 10 | (3 | ) | ||||||||||
Share in profit/(losses) of associated companies, net | 45 | (18 | ) | 46 | (3 | ) | ||||||||||
Profit before income taxes | 369 | 10 | 65 | 16 | ||||||||||||
Income taxes | (8 | ) | (14 | ) | (3 | ) | (7 | ) | ||||||||
Profit/(loss) for the period from continuing operations | 361 | (4 | ) | 62 | 9 | |||||||||||
Gain/(loss) for the period from discontinued operations | ||||||||||||||||
-Recovery of retained claims, net | 8 | 26 | 8 | 26 | ||||||||||||
-Other | - | (1 | ) | - | - | |||||||||||
8 | 25 | 8 | 26 | |||||||||||||
Profit for the period | 369 | 21 | 70 | 35 | ||||||||||||
Attributable to: | ||||||||||||||||
Kenon's shareholders | 362 | 9 | 67 | 28 | ||||||||||||
Non-controlling interests | 7 | 12 | 3 | 7 | ||||||||||||
Profit for the period | 369 | 21 | 70 | 35 | ||||||||||||
Basic/diluted profit/(loss) per share attributable to Kenon's shareholders (in dollars): | ||||||||||||||||
Basic/diluted profit per share | 6.72 | 0.16 | 1.25 | 0.53 | ||||||||||||
Basic/diluted profit/(loss) per share from continuing operations | 6.56 | (0.30 | ) | 1.09 | 0.05 | |||||||||||
Basic/diluted profit per share from discontinued operations | 0.16 | 0.46 | 0.16 | 0.48 |
Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Cash Flows
For the nine months ended September 30, 2020 and 2019
Consolidated Statement of Cash Flows
For the nine months ended September 30, 2020 and 2019
For the nine months ended September 30, | ||||||||
2020 | 2019 | |||||||
$ millions | ||||||||
Cash flows from operating activities | ||||||||
Profit for the period | 369 | 21 | ||||||
Adjustments: | ||||||||
Depreciation and amortization | 23 | 23 | ||||||
Financing expenses, net | 11 | 8 | ||||||
Share in (profit)/losses of associated companies, net | (45 | ) | 18 | |||||
Net (gains)/losses related to changes of interest in Qoros | (304 | ) | 11 | |||||
Gain on sale of property, plant and equipment | (2 | ) | - | |||||
Recovery of retained claims, net | (8 | ) | - | |||||
Share-based payments | 1 | 1 | ||||||
Income taxes | 8 | 19 | ||||||
53 | 101 | |||||||
Change in trade and other receivables | 11 | (18 | ) | |||||
Change in trade and other payables | 19 | 16 | ||||||
83 | 99 | |||||||
Income taxes paid, net | - | (3 | ) | |||||
Net cash provided by operating activities | 83 | 96 |
Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Cash Flows, continued
For the nine months ended September 30, 2020 and 2019
Consolidated Statement of Cash Flows, continued
For the nine months ended September 30, 2020 and 2019
For the nine months ended September 30, | ||||||||
2020 | 2019 | |||||||
$ millions | ||||||||
Cash flows from investing activities | ||||||||
Short-term deposits and restricted cash, net | 17 | (18) | ||||||
Investment in long-term deposits, net | (23) | (20) | ||||||
Sale of subsidiary, net of cash disposed off | - | 1 | ||||||
Acquisition of property, plant and equipment | (50) | (24) | ||||||
Deferred consideration in respect of acquisition of subsidiary | (13) | - | ||||||
Proceeds from sale of interest in Qoros | 220 | - | ||||||
Recovery of retained claims, net | 10 | 5 | ||||||
Income tax paid | - | (6) | ||||||
Long-term advance deposits and prepaid expenses | (54) | - | ||||||
Interest received | 1 | 2 | ||||||
Payments of transactions in derivatives, net | (2) | (1) | ||||||
Net cash provided/(used in) by investing activities | 106 | (61) | ||||||
Cash flows from financing activities | ||||||||
Repayment of long-term loans, debentures, derivative financial instruments and lease liabilities | (34) | (14) | ||||||
Proceeds from long-term loans | 58 | - | ||||||
Proceeds from issuance of share capital by a subsidiary to non-controlling interests | - | 76 | ||||||
Proceeds from issuance of debentures, less issuance expenses | 111 | - | ||||||
Short-term credit from banks and others, net | (7) | (4) | ||||||
Acquisition of non-controlling interests | (8) | - | ||||||
Payment in respect of derivative financial instruments, net | (4) | - | ||||||
Dividends paid to holders of non-controlling interests | (6) | (7) | ||||||
Interest paid | (17) | (15) | ||||||
Net cash provided by financing activities | 93 | 36 | ||||||
Increase in cash and cash equivalents | 282 | 71 | ||||||
Cash and cash equivalents at beginning of the period | 147 | 131 | ||||||
Effect of exchange rate fluctuations on balances of cash and cash equivalents | 3 | 8 | ||||||
Cash and cash equivalents at end of the period | 432 | 210 |
Information regarding reportable segments
The following table sets forth selected financial data for Kenon’s reportable segments for the periods presented:
For the nine months ended September 30, 2020 | ||||||||||||||||||||
OPC | Quantum1 | ZIM | Other2 | Consolidated Results | ||||||||||||||||
$ millions | ||||||||||||||||||||
Revenue | 281 | - | - | 1 | 282 | |||||||||||||||
Depreciation and amortization | (23 | ) | - | - | - | (23 | ) | |||||||||||||
Financing income | 1 | - | - | 12 | 13 | |||||||||||||||
Financing expenses | (24 | ) | - | - | - | (24 | ) | |||||||||||||
Net gains related to changes of interest in Qoros | - | 304 | - | - | 304 | |||||||||||||||
Share in (losses)/profit of associated companies | - | (6 | ) | 51 | - | 45 | ||||||||||||||
Profit before taxes | 19 | 298 | 51 | 1 | 369 | |||||||||||||||
Income taxes | (7 | ) | - | - | (1 | ) | (8 | ) | ||||||||||||
Profit from continuing operations | 12 | 298 | 51 | - | 361 |
____________________________________
(1) | Quantum is a wholly-owned subsidiary of Kenon which holds Kenon's interest in Qoros. |
(2) | Includes the results of Primus; as well as Kenon’s and IC Green’s holding company and general and administrative expenses. |
For the nine months ended September 30, 2019 | ||||||||||||||||||||
OPC | Quantum1 | ZIM | Other2 | Consolidated Results | ||||||||||||||||
$ millions | ||||||||||||||||||||
Revenue | 284 | - | - | - | 284 | |||||||||||||||
Depreciation and amortization | (23 | ) | - | - | - | (23 | ) | |||||||||||||
Financing income | 2 | - | - | 12 | 14 | |||||||||||||||
Financing expenses | (22 | ) | - | - | - | (22 | ) | |||||||||||||
Recovery of financial guarantee | - | 11 | - | - | 11 | |||||||||||||||
Fair value loss on put option | - | (22 | ) | - | - | (22 | ) | |||||||||||||
Share in losses of associated companies | - | (13 | ) | (5 | ) | - | (18 | ) | ||||||||||||
Profit / (Loss) before taxes | 39 | (24 | ) | (5 | ) | - | 10 | |||||||||||||
Income taxes | (11 | ) | - | - | (3 | ) | (14 | ) | ||||||||||||
Profit / (Loss) from continuing operations | 28 | (24 | ) | (5 | ) | (3 | ) | (4 | ) |
____________________________________
(1) | Quantum is a wholly-owned subsidiary of Kenon which holds Kenon's interest in Qoros. |
(2) | Includes the results of Primus; as well as Kenon’s and IC Green’s holding company and general and administrative expenses. |
For the three months ended September 30, 2020 | ||||||||||||||||||||
OPC | Quantum1 | ZIM | Other2 | Consolidated Results | ||||||||||||||||
$ millions | ||||||||||||||||||||
Revenue | 117 | - | - | - | 117 | |||||||||||||||
Depreciation and amortization | (9 | ) | - | - | - | (9 | ) | |||||||||||||
Financing income | - | - | - | 5 | 5 | |||||||||||||||
Financing expenses | (11 | ) | - | - | - | (11 | ) | |||||||||||||
Net gains related to changes of interest in Qoros | - | 10 | - | - | 10 | |||||||||||||||
Share in profit of associated companies | - | - | 46 | - | 46 | |||||||||||||||
Profit before taxes | 8 | 10 | 46 | 1 | 65 | |||||||||||||||
Income taxes | (3 | ) | - | - | - | (3 | ) | |||||||||||||
Profit from continuing operations | 5 | 10 | 46 | 1 | 62 |
____________________________________
(1) | Quantum is a wholly-owned subsidiary of Kenon which holds Kenon's interest in Qoros. |
(2) | Includes the results of Primus; as well as Kenon’s and IC Green’s holding company and general and administrative expenses. |
For the three months ended September 30, 2019 | ||||||||||||||||||||
OPC | Quantum1 | ZIM | Other2 | Consolidated Results | ||||||||||||||||
$ millions | ||||||||||||||||||||
Revenue | 102 | - | - | - | 102 | |||||||||||||||
Depreciation and amortization | (8 | ) | - | - | - | (8 | ) | |||||||||||||
Financing income | 1 | - | - | 4 | 5 | |||||||||||||||
Financing expenses | (6 | ) | - | - | - | (6 | ) | |||||||||||||
Net gains related to changes of interest in Qoros | - | (3 | ) | - | - | (3 | ) | |||||||||||||
Share in losses of associated companies | - | (5 | ) | 2 | - | (3 | ) | |||||||||||||
Profit / (Loss) before taxes | 20 | (8 | ) | 2 | 2 | 16 | ||||||||||||||
Income taxes | (6 | ) | - | - | (1 | ) | (7 | ) | ||||||||||||
Profit / (Loss) from continuing operations | 14 | (8 | ) | 2 | 1 | 9 |
____________________________________
(1) Quantum is a wholly-owned subsidiary of Kenon which holds Kenon's interest in Qoros.
(2) Includes the results of Primus; as well as Kenon’s and IC Green’s holding company and general and administrative expenses.
Information regarding associated companies
Asset held for sale | Carrying amounts of investment in associated companies | Equity in the net earnings / (losses) of associated companies | ||||||||||||||||||||||||||
as at | as at | For the nine months ended | for the three months ended | |||||||||||||||||||||||||
December 31, 2019 | September 30, 2020 | December 31, 2019 | September 30, 2020 | September 30, 2019 | September 30, 2020 | September 30, 2019 | ||||||||||||||||||||||
$ millions | $ millions | $ millions | $ millions | |||||||||||||||||||||||||
ZIM | - | 137 | 84 | 51 | (5 | ) | 46 | 2 | ||||||||||||||||||||
Qoros | 70 | - | 36 | (6 | ) | (13 | ) | - | (5 | ) | ||||||||||||||||||
70 | 137 | 120 | 45 | (18 | ) | 46 | (3 | ) |
Summary OPC consolidated financial information1
Summary Data from OPC’s Consolidated Statement of Income
For the nine months ended September 30, | For the three months ended September 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
$ millions | $ millions | |||||||||||||||
Revenue | 281 | 284 | 117 | 102 | ||||||||||||
Cost of sales (excluding depreciation and amortization) | (202 | ) | (195 | ) | (84 | ) | (69 | ) | ||||||||
Depreciation and amortization | (23 | ) | (23 | ) | (9 | ) | (8 | ) | ||||||||
Gross profit | 56 | 66 | 24 | 25 | ||||||||||||
Selling, general and administrative expenses | (13 | ) | (12 | ) | (5 | ) | (4 | ) | ||||||||
Other income | - | 5 | - | 4 | ||||||||||||
Financing expenses, net | (24 | ) | (20 | ) | (11 | ) | (5 | ) | ||||||||
Profit before taxes | 19 | 39 | 8 | 20 | ||||||||||||
Taxes on income | (7 | ) | (11 | ) | (3 | ) | (6 | ) | ||||||||
Net profit for the period | 12 | 28 | 5 | 14 | ||||||||||||
Attributable to: | ||||||||||||||||
Equity holders of the company | 6 | 20 | 3 | 10 | ||||||||||||
Non-controlling interest | 6 | 8 | 2 | 4 | ||||||||||||
Net profit for the period | 12 | 28 | 5 | 14 |
____________________________________
(1) Translations of NIS amounts into US Dollars use a rate of 3.47: 1 for 2020 and 3.59: 1 for 2019.
Summary Data from OPC’s Consolidated Statement of Cash Flows
For the nine months ended September 30, | For the three months ended September 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
$ millions | $ millions | |||||||||||||||
Cash flows provided by operating activities | 88 | 115 | 37 | 41 | ||||||||||||
Cash flows used in investing activities | (126 | ) | (61 | ) | (25 | ) | (2 | ) | ||||||||
Cash flows provided by financing activities | 94 | 29 | 14 | 30 | ||||||||||||
Increase in cash and cash equivalents | 56 | 83 | 26 | 69 | ||||||||||||
Cash and cash equivalents at end of the period | 172 | 180 | 172 | 180 | ||||||||||||
Investments in property, plant and equipment | 50 | 24 | 25 | 5 | ||||||||||||
Total depreciation and amortization | 23 | 23 | 9 | 8 |
Summary Data from OPC’s Consolidated Statement of Financial Position
As of | ||||||||
September 30, 2020 | December 31, 2019 | |||||||
$ millions | ||||||||
Total financial liabilities1 | 763 | 622 | ||||||
Total monetary assets2 | 234 | 152 | ||||||
Total equity attributable to the owners | 221 | 228 | ||||||
Total assets | 1,194 | 1,011 |
____________________________________
(1) | Including loans from banks and others and debentures |
(2) | Including cash and cash equivalents, short-term deposits and restricted cash. |
Definition of OPC’s EBITDA and non-IFRS reconciliation
This press release, including the financial tables, presents EBITDA, which is considered to be a “non-IFRS financial measure.”
OPC defines “EBITDA” as for each period as net profit before depreciation and amortization, financing expenses, net, and income tax expense. EBITDA is not recognized under IFRS or any other generally accepted accounting principles as a measure of financial performance and should not be considered as a substitute for net profit or loss, cash flow from operations or other measures of operating performance determined in accordance with IFRS. EBITDA is not intended to represent funds available for dividends or other discretionary uses because those funds may be required for debt service, capital expenditures, working capital and other commitments and contingencies. There are limitations that impair the use of EBITDA as a measure of OPC's profitability since it does not take into consideration certain costs and expenses that result from OPC's business that could have a significant effect on net profit, such as financial expenses, taxes, depreciation, capital expenses and other related items.
OPC believes that the disclosure of EBITDA provides transparent and useful information to investors and financial analysts in their review of the company’s, or its subsidiaries’ operating performance and in the comparison of such operating performance to the operating performance of other companies in the same industry or in other industries that have different capital structures, debt levels and/or income tax rates.
Set forth below is a reconciliation of OPC’s net profit to EBITDA for the periods presented. Other companies may calculate EBITDA differently, and therefore this presentation of EBITDA may not be comparable to other similarly titled measures used by other companies.
For the nine months ended September 30, | ||||||||
2020 | 2019 | |||||||
$ millions | ||||||||
Net profit for the period | 12 | 28 | 1 | |||||
Depreciation and amortization | 23 | 23 | ||||||
Financing expenses, net | 24 | 20 | ||||||
Income tax expense | 7 | 11 | ||||||
EBITDA | 66 | 82 |
____________________________________
(1) Includes non-recurring revenue of $4 million.
For the three months ended September 30, | ||||||||
2020 | 2019 | |||||||
$ millions | ||||||||
Net profit for the period | 5 | 14 | 1 | |||||
Depreciation and amortization | 9 | 8 | ||||||
Financing expenses, net | 11 | 5 | ||||||
Income tax expense | 3 | 6 | ||||||
EBITDA | 28 | 33 |
____________________________________
(1) Includes non-recurring revenue of $4 million.
Summary Financial Information of OPC and its Subsidiaries
The tables below set forth debt, cash and cash equivalents, deposits and restricted cash for OPC and its subsidiaries as of September 30, 2020:
As at September 30, 2020 | OPC-Rotem | OPC-Hadera | OPC Energy | Other | Total | |||||||||||||||
Debt (including accrued interest) | 325 | 205 | 194 | 39 | 763 | |||||||||||||||
Cash and cash equivalents and short-term deposits | 77 | 2 | 82 | 11 | 172 | |||||||||||||||
Debt service reserves (out of restricted cash) | 22 | 13 | 27 | - | 62 |
The table below sets forth debt, cash and cash equivalents, deposits and debt service reserves for OPC and its subsidiaries as of December 31, 2019 (in $ millions):
As at December 31, 2019 | OPC-Rotem | OPC-Hadera | OPC Energy | Other | Total | |||||||||||||||
Debt (including accrued interest) | 346 | 194 | 82 | - | 622 | |||||||||||||||
Cash and cash equivalents and short-term deposits | 33 | 3 | 74 | 1 | 111 | |||||||||||||||
Debt service reserves (out of restricted cash) | 22 | - | 19 | - | 41 |
Summary Operational Information of OPC
The tables below set forth details of sales, generation and purchases of electricity by OPC and availability and net generation of OPC split by the OPC-Rotem plant and the OPC-Hadera energy center (kWh in millions):
For the nine months ended September 30, | For the three months ended September 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Sales to private customers | 3,057 | 2,982 | 1,200 | 991 | ||||||||||||
Sales to the system administrator | 115 | 54 | 7 | 6 | ||||||||||||
Total sales | 3,172 | 3,036 | 1,207 | 997 |
For the nine months ended September 30, | For the three months ended September 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Net generation of electricity | 2,958 | 2,829 | 1,048 | 897 | ||||||||||||
Purchase of electricity from the system administrator | 214 | 207 | 159 | 100 | ||||||||||||
Total volume of electricity generated and purchases from the system administrator | 3,172 | 3,036 | 1,207 | 997 |
For the nine months ended September 30, | For the nine months ended September 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
In thousands of tonnes | ||||||||||||||||
Net generation of electricity and purchases during dispatch reduction – OPC Rotem | 2,692 | 2,766 | 826 | 876 | ||||||||||||
Net generation – OPC Hadera (energy center) | 266 | 63 | 222 | 21 | ||||||||||||
Total volume of electricity generated and purchases from the system administrator | 2,958 | 2,829 | 1,048 | 897 |
For the nine months ended September 30, | For the nine months ended September 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
In thousands of tonnes | ||||||||||||||||
Steam Generation | 544 | 574 | 159 | 186 |