Exhibit 99.2
Financial Information for the Three Months Ended March 31, 2021 of Kenon and OPC and
Reconciliation of Certain non-IFRS Financial Information
Table of Contents
Summary Kenon consolidated financial information
Kenon Holdings Ltd. and its subsidiaries
Consolidated Statements of Financial Position (Unaudited)
Consolidated Statements of Financial Position (Unaudited)
March 31, | December 31, | |||||||
2021 | 2020 | |||||||
$ millions | ||||||||
Current assets | ||||||||
Cash and cash equivalents | 455 | 286 | ||||||
Short-term deposits and restricted cash | 22 | 564 | ||||||
Trade receivables | 44 | 48 | ||||||
Short-term derivative instruments | 1 | - | ||||||
Other current assets | 28 | 22 | ||||||
Total current assets | 550 | 920 | ||||||
Non-current assets | ||||||||
Investment in ZIM (associated company) | 478 | 297 | ||||||
Investment in CPV (associated companies) | 550 | - | ||||||
Long-term investment | 233 | 235 | ||||||
Long-term deposits and restricted cash | 55 | 72 | ||||||
Long-term prepaid expenses | 45 | 45 | ||||||
Long-term derivative instruments | 5 | - | ||||||
Deferred taxes, net | 9 | 7 | ||||||
Property, plant and equipment, net | 924 | 819 | ||||||
Intangible assets, net | 217 | 1 | ||||||
Right-of-use assets, net | 94 | 86 | ||||||
Total non-current assets | 2,610 | 1,562 | ||||||
Total assets | 3,160 | 2,482 | ||||||
Current liabilities | ||||||||
Current maturities of loans from banks and others | 50 | 47 | ||||||
Short-term derivative instruments | 10 | 39 | ||||||
Current tax liabilities | 1 | - | ||||||
Trade and other payables | 154 | 128 | ||||||
Current maturities of lease liabilities | 17 | 14 | ||||||
Total current liabilities | 232 | 228 | ||||||
Non-current liabilities | ||||||||
Long-term loans from banks and others | 719 | 576 | ||||||
Debentures | 282 | 296 | ||||||
Deferred taxes, net | 105 | 94 | ||||||
Other non-current liabilities | 30 | 1 | ||||||
Long-term derivative instruments | 7 | 7 | ||||||
Long-term lease liabilities | 14 | 4 | ||||||
Total non-current liabilities | 1,157 | 978 | ||||||
Total liabilities | 1,389 | 1,206 | ||||||
Equity | ||||||||
Share capital | 602 | 602 | ||||||
Translation reserve | 13 | 16 | ||||||
Capital reserve | 17 | (11 | ) | |||||
Accumulated profit/(loss) | 682 | 460 | ||||||
Equity attributable to owners of the Company | 1,314 | 1,067 | ||||||
Non-controlling interests | 457 | 209 | ||||||
Total equity | 1,771 | 1,276 | ||||||
Total liabilities and equity | 3,160 | 2,482 |
2
Kenon Holdings Ltd. and its subsidiaries
Consolidated Statements of Profit or Loss (Unaudited)
Consolidated Statements of Profit or Loss (Unaudited)
For the three months ended March 31, | ||||||||
2021 | 2020 | |||||||
$ millions | ||||||||
Revenue | 115 | 89 | ||||||
Cost of sales and services (excluding depreciation and amortization) | (79 | ) | (58 | ) | ||||
Depreciation and amortization | (13 | ) | (7 | ) | ||||
Gross profit | 23 | 24 | ||||||
Selling, general and administrative expenses | (10 | ) | (8 | ) | ||||
Operating profit | 13 | 16 | ||||||
Financing expenses | (12 | ) | (7 | ) | ||||
Financing income | 6 | 7 | ||||||
Financing expenses, net | (6 | ) | - | |||||
Net (loss)/gains related to Qoros | (2 | ) | 16 | |||||
Gain related to ZIM dilution | 10 | - | ||||||
Share in profit/(losses) of associated companies, net | ||||||||
- ZIM | 172 | (3 | ) | |||||
- CPV | (11 | ) | - | |||||
- Qoros | - | (4 | ) | |||||
Profit before income taxes | 176 | 25 | ||||||
Income tax benefit/(expense) | 2 | (5 | ) | |||||
Profit for the period | 178 | 20 | ||||||
Attributable to: | ||||||||
Kenon’s shareholders | 180 | 15 | ||||||
Non-controlling interests | (2 | ) | 5 | |||||
Profit for the period | 178 | 20 | ||||||
Basic/diluted profit per share attributable to Kenon’s shareholders (in dollars): | ||||||||
Basic/diluted profit per share | 3.34 | 0.28 |
3
Kenon Holdings Ltd. and its subsidiaries
Consolidated Statements of Cash Flows (Unaudited)
Consolidated Statements of Cash Flows (Unaudited)
For the three months ended March 31, | ||||||||
2021 | 2020 | |||||||
$ millions | ||||||||
Cash flows from operating activities | ||||||||
Profit for the period | 178 | 20 | ||||||
Adjustments: | ||||||||
Depreciation and amortization | 13 | 7 | ||||||
Financing expenses, net | 6 | - | ||||||
Net losses/(gains) related to Qoros | 2 | (16 | ) | |||||
Gain related to ZIM dilution | (10 | ) | - | |||||
Share in (profit)/losses of associated companies, net | (161 | ) | 7 | |||||
Share-based payments | 1 | - | ||||||
Income tax (benefit)/expense | (2 | ) | 5 | |||||
27 | 23 | |||||||
Change in trade and other receivables | - | 4 | ||||||
Change in trade and other payables | (8 | ) | (7 | ) | ||||
Cash generated from operating activities | 19 | 20 | ||||||
Dividend received from associated companies | 3 | - | ||||||
Net cash provided by operating activities | 22 | 20 |
4
Kenon Holdings Ltd. and its subsidiaries
Consolidated Statements of Cash Flows (Unaudited), continued
Consolidated Statements of Cash Flows (Unaudited), continued
For the three months ended March 31, | ||||||||
2021 | 2020 | |||||||
$ millions | ||||||||
Cash flows from investing activities | ||||||||
Short-term deposits and restricted cash, net | 545 | 11 | ||||||
Investment in long-term deposits, net | 16 | (16 | ) | |||||
Acquisition of subsidiary, less cash acquired | (656 | ) | - | |||||
Acquisition of property, plant and equipment | (45 | ) | (28 | ) | ||||
Reimbursement in respect of right-of-use asset | 2 | - | ||||||
Proceeds from sale of investment in associated company | 41 | - | ||||||
Long-term advance deposits and prepaid expenses | (1 | ) | (55 | ) | ||||
Payment of transactions in derivatives, net | - | (1 | ) | |||||
Net cash used in investing activities | (98 | ) | (89 | ) | ||||
Cash flows from financing activities | ||||||||
Repayment of long-term loans and debentures, derivative financial instruments and lease liabilities | (56 | ) | (4 | ) | ||||
Investments of holders of non-controlling interests in the capital of a subsidiary | 167 | - | ||||||
Proceeds from issuance of share capital by a subsidiary to non-controlling interests, net of issuance expenses | 105 | - | ||||||
Receipt of long-term loans from banks and others | 52 | - | ||||||
Short-term credit from banks and others, net | - | 59 | ||||||
Payment in respect of derivative financial instruments, net | (2 | ) | (1 | ) | ||||
Costs paid in advance in respect of taking out of loans | (1 | ) | - | |||||
Dividends paid to holders of non-controlling interests | - | (6 | ) | |||||
Acquisition of non-controlling interests | - | (8 | ) | |||||
Interest paid | (11 | ) | (4 | ) | ||||
Net cash provided by financing activities | 254 | 36 | ||||||
Increase/(decrease) in cash and cash equivalents | 178 | (33 | ) | |||||
Cash and cash equivalents at beginning of the year | 286 | 147 | ||||||
Effect of exchange rate fluctuations on balances of cash and cash equivalents | (9 | ) | (3 | ) | ||||
Cash and cash equivalents at end of the period | 455 | 111 |
5
Information regarding reportable segments
Information regarding activities of the reportable segments are set forth in the following table.
For the three months ended March 31, 2021 | ||||||||||||||||||||||||
OPC Israel | CPV | ZIM | Quantum | Other | Consolidated Results | |||||||||||||||||||
$ millions | ||||||||||||||||||||||||
Revenue | 107 | 8 | - | - | - | 115 | ||||||||||||||||||
Depreciation and amortization | (11 | ) | (2 | ) | - | - | - | (13 | ) | |||||||||||||||
Financing income | 3 | 3 | - | 6 | ||||||||||||||||||||
Financing expenses | (10 | ) | (2 | ) | - | - | - | (12 | ) | |||||||||||||||
Net losses related to Qoros | - | - | - | (2 | ) | - | (2 | ) | ||||||||||||||||
Gain related to ZIM dilution | - | - | 10 | - | - | 10 | ||||||||||||||||||
Share in (losses)/profit of associated companies | - | (11 | ) | 172 | - | - | 161 | |||||||||||||||||
Profit/(loss) before taxes | 11 | (13 | ) | 181 | (2 | ) | (1 | ) | 176 | |||||||||||||||
Income taxes (expense)/benefit | (3 | ) | 5 | - | - | - | 2 | |||||||||||||||||
Profit from continuing operations | 8 | (8 | ) | 181 | (2 | ) | (1 | ) | 178 |
For the three months ended March 31, 2020 | ||||||||||||||||||||
OPC | ZIM | Quantum | Other | Consolidated Results | ||||||||||||||||
$ millions | ||||||||||||||||||||
Revenue | 89 | - | - | - | 89 | |||||||||||||||
Depreciation and amortization | (7 | ) | - | - | - | (7 | ) | |||||||||||||
Financing income | 2 | - | - | 5 | 7 | |||||||||||||||
Financing expenses | (7 | ) | - | - | - | (7 | ) | |||||||||||||
Net losses related to Qoros | - | - | 16 | - | 16 | |||||||||||||||
Share in losses of associated companies | - | (3 | ) | (4 | ) | - | (7 | ) | ||||||||||||
Profit/(loss) before taxes | 15 | (3 | ) | 12 | 1 | 25 | ||||||||||||||
Income taxes | (4 | ) | - | - | (1 | ) | (5 | ) | ||||||||||||
Profit/(loss) from continuing operations | 11 | (3 | ) | 12 | - | 20 |
6
Information regarding associated companies
Carrying amounts of investment in associated companies | Equity in the net profit / (losses) of associated companies | |||||||||||||||
as at | for the period ended | |||||||||||||||
March 31, | December 31, | March 31, | March 31, | |||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
$ millions | $ millions | |||||||||||||||
ZIM | 478 | 297 | 172 | (3 | ) | |||||||||||
CPV Fairview LLC | 169 | - | (2 | ) | - | |||||||||||
CPV Towantic LLC | 117 | - | 3 | - | ||||||||||||
CPV Maryland LLC | 60 | - | - | - | ||||||||||||
CPV Shore Holdings LLC | 65 | - | - | - | ||||||||||||
CPV Valley Holdings LLC | 74 | - | (12 | ) | - | |||||||||||
CPV Three Rivers LLC | 65 | - | - | - | ||||||||||||
Qoros* | - | - | - | (4 | ) | |||||||||||
(111 | ||||||||||||||||
1,028 | 297 | 161 | (7 | ) |
*Qoros was accounted for as an associated company until April 2020, when we reduced our interest in Qoros from 24% to 12%.
7
Summary of OPC consolidated financial information
OPC’s Consolidated Statements of Profit or Loss (Unaudited)
For the three months ended March 31, | ||||||||
2021 | 2020 | |||||||
$ millions | $ millions | |||||||
Revenue | 115 | 89 | ||||||
Cost of sales (excluding depreciation and amortization) | (79 | ) | (58 | ) | ||||
Depreciation and amortization | (13 | ) | (7 | ) | ||||
Gross profit | 23 | 24 | ||||||
Selling, general and administrative expenses | (8 | ) | (4 | ) | ||||
Operating profit | 15 | 20 | ||||||
Financing expenses | (12 | ) | (7 | ) | ||||
Financing income | 6 | 2 | ||||||
Financing expenses, net | (6 | ) | (5 | ) | ||||
Share of losses of associated companies, net | (11 | ) | - | |||||
(Loss)/profit before income taxes | (2 | ) | 15 | |||||
Income taxes benefit/(expense) | 2 | (4 | ) | |||||
Net profit for the period | - | 11 | ||||||
Attributable to: | ||||||||
Equity holders of the company | 2 | 8 | ||||||
Non-controlling interest | (2 | ) | 3 | |||||
Net profit for the period | - | 11 |
8
Summary Data from OPC’s Consolidated Statement of Cash Flows (Unaudited)
For the three months ended March 31, | ||||||||
2021 | 2020 | |||||||
$ millions | ||||||||
Cash flows provided by operating activities | 24 | 24 | ||||||
Cash flows used in investing activities | (98 | ) | (89 | ) | ||||
Cash flows provided by financing activities | 254 | 35 | ||||||
Increase/(Decrease) in cash and cash equivalents | 180 | (30 | ) | |||||
Cash and cash equivalents at end of the period | 233 | 78 |
Summary Data from OPC’s Consolidated Statement of Financial Position (Unaudited)
As at | ||||||||
March 31, 2021 | December 31, 2020 | |||||||
$ millions | ||||||||
Total financial liabilities1 | 1,051 | 921 | ||||||
Total monetary assets2 | 277 | 608 | ||||||
Investment in associated companies | 550 | - | ||||||
Total equity attributable to the owners | 671 | 520 | ||||||
Total assets | 2,235 | 1,734 |
1. | Including loans from banks and others and debentures |
2. | Including cash and cash equivalents and debt service reserves (out of restricted cash) |
9
Definition of OPC’s Adjusted EBITDA and non-IFRS reconciliation
This press release, including the financial tables, presents OPC’s EBITDA, which is a non-IFRS financial measure.
OPC defines Adjusted EBITDA as for each period as net profit before depreciation and amortization, financing expenses, net, share of losses of associated companies, net, and income tax expense. Adjusted 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. Adjusted 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 Adjusted 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, and depreciation and amortization.
OPC believes that the disclosure of Adjusted 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 Adjusted EBITDA for the periods presented. Other companies may calculate Adjusted EBITDA differently, and therefore this presentation of Adjusted EBITDA may not be comparable to other similarly titled measures used by other companies.
For the three months ended March 31, 2021 | ||||
$ millions | ||||
Total | ||||
Net profit for the period | - | |||
Depreciation and amortization | 13 | |||
Financing expenses, net | 6 | |||
Share of losses of associated companies, net | 11 | |||
Income tax benefit | (2 | ) | ||
Adjusted EBITDA | 28 | |||
Proportionate share of EBITDA of associated companies | 18 | 1 |
For the three months ended March 31, 2020 | ||||
$ millions | ||||
Total | ||||
Net profit for the period | 11 | |||
Depreciation and amortization | 7 | |||
Financing expenses, net | 5 | |||
Income tax expense | 4 | |||
EBITDA | 27 |
1 Reconciliation of Net income to EBITDA for associated companies
For the three months ended March 31, 2021 | ||||
$ millions | ||||
Total | ||||
Share of net loss for the period | (11 | ) | ||
Share of depreciation and amortization | 8 | |||
Share of financing expenses, net | 21 | |||
Share of EBITDA | 18 |
10
Summary Financial Information of OPC’s Subsidiaries
The tables below set forth debt, cash and cash equivalents, and debt service reserves for OPC’s subsidiaries as of March 31, 2021 and December 31, 2020 (in $ millions):
As at March 31, 2021 | OPC Energy | OPC-Rotem | OPC-Hadera | OPC-Tzomet | Keenan | Other | Total | |||||||||||||||||||||
Debt (including accrued interest) | 289 | 322 | 207 | 55 | 71 | 107 | 1,051 | |||||||||||||||||||||
Cash and cash equivalents and short-term deposits | 104 | 47 | 4 | 6 | 11 | 68 | 240 | |||||||||||||||||||||
Debt service reserves (out of restricted cash)1 | - | 23 | 14 | - | - | - | 37 |
As at December 31, 2020 | OPC Energy | OPC-Rotem | OPC-Hadera | Other | Total | |||||||||||||||
Debt (including accrued interest) | 305 | 341 | 217 | 58 | 921 | |||||||||||||||
Cash and cash equivalents and short-term deposits | 511 | 38 | 1 | 12 | 562 | |||||||||||||||
Debt service reserves (out of restricted cash)1 | 8 | 24 | 14 | - | 46 |
1 Including reserves used for guarantees of debt.
11
Definition of ZIM’s EBITDA and non-IFRS reconciliation
This press release, including the financial tables, presents ZIM’s EBITDA, which is a non-IFRS financial measure.
ZIM 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 ZIM’s profitability since it does not take into consideration certain costs and expenses that result from ZIM’s business that could have a significant effect on net profit, such as financial expenses, taxes, and depreciation and amortization.
ZIM believes that the disclosure of EBITDA enables the comparison of operating performance between periods on a consistent basis. In addition, non-IFRS financial measures may not be comparable to similarly titled measures reported by other companies, due to differences in the way these measures are calculated.
Set forth below is a reconciliation of ZIM’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 three months ended March 31, 2021 | ||||
$ millions | ||||
Total | ||||
Net profit for the period | 590 | |||
Depreciation and amortization | 134 | |||
Financing expenses, net | 39 | |||
Income tax expense | 54 | |||
EBITDA | 817 |
For the three months ended March 31, 2020 | ||||
$ millions | ||||
Total | ||||
Net loss for the period | (12 | ) | ||
Depreciation and amortization | 72 | |||
Financing expenses, net | 34 | |||
Income tax expense | 3 | |||
EBITDA | 97 |
12