Exhibit 99.2
Financial Information for the Years Ended December 31, 2021 and 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 its subsidiaries
Consolidated Statements of Financial Position as at December 31, 2022 and 2021
December 31, | December 31, | |||||||
2022 | 2021 | |||||||
$ millions | ||||||||
Current assets | ||||||||
Cash and cash equivalents | 535 | 475 | ||||||
Short-term deposits and restricted cash | 46 | - | ||||||
Trade receivables | 74 | 63 | ||||||
Short-term derivative instruments | 3 | 1 | ||||||
Other investments | 345 | - | ||||||
Other current assets | 59 | 43 | ||||||
Total current assets | 1,062 | 582 | ||||||
Non-current assets | ||||||||
Investment in ZIM (associated company) | 427 | 1,354 | ||||||
Investment in OPC’s associated companies | 652 | 545 | ||||||
Long-term deposits and restricted cash | 15 | 21 | ||||||
Long-term derivative instruments | 16 | 12 | ||||||
Deferred taxes, net | 6 | 19 | * | |||||
Property, plant and equipment, net | 1,223 | 1,126 | ||||||
Intangible assets, net | 221 | 225 | ||||||
Long-term prepaid expenses and other non-current assets | 51 | 57 | ||||||
Right-of-use assets, net | 99 | 98 | ||||||
Total non-current assets | 2,710 | 3,457 | ||||||
Total assets | 3,772 | 4,039 | ||||||
Current liabilities | ||||||||
Current maturities of loans from banks and others | 39 | 38 | ||||||
Trade and other payables | 134 | 171 | ||||||
Dividend payable | - | 189 | ||||||
Short-term derivative instruments | 1 | 9 | ||||||
Current tax liabilities | 1 | - | ||||||
Deferred taxes | 1 | 21 | ||||||
Current maturities of lease liabilities | 17 | 19 | ||||||
Total current liabilities | 193 | 447 | ||||||
Non-current liabilities | ||||||||
Long-term loans from banks and others | 610 | 597 | ||||||
Debentures | 513 | 575 | ||||||
Deferred taxes, net | 98 | 95 | * | |||||
Other non-current liabilities | 42 | 29 | ||||||
Long-term lease liabilities | 20 | 15 | ||||||
Total non-current liabilities | 1,283 | 1,311 | ||||||
Total liabilities | 1,476 | 1,758 | ||||||
Equity | ||||||||
Share capital | 50 | 602 | ||||||
Translation reserve | 1 | 26 | ||||||
Capital reserve | 42 | 26 | ||||||
Accumulated profit | 1,505 | 1,140 | ||||||
Equity attributable to owners of the Company | 1,598 | 1,794 | ||||||
Non-controlling interests | 698 | 487 | ||||||
Total equity | 2,296 | 2,281 | ||||||
Total liabilities and equity | 3,772 | 4,039 |
*Reclassified
Kenon Holdings Ltd. and its subsidiaries
Consolidated Statements of Profit or Loss for the years ended December 31, 2022 and 2021
Consolidated Statements of Profit or Loss for the years ended December 31, 2022 and 2021
For the year ended December 31, | ||||||||
2022 | 2021 | |||||||
$ millions | ||||||||
Revenue | 574 | 488 | ||||||
Cost of sales and services (excluding depreciation and amortization) | (417 | ) | (337 | ) | ||||
Depreciation and amortization | (57 | ) | (53 | ) | ||||
Gross profit | 100 | 98 | ||||||
Selling, general and administrative expenses | (100 | ) | (76 | ) | ||||
Other income | 3 | - | ||||||
Operating profit | 3 | 22 | ||||||
Financing expenses | (50 | ) | (144 | ) | ||||
Financing income | 45 | 3 | ||||||
Financing expenses, net | (5 | ) | (141 | ) | ||||
Losses related to Qoros | - | (251 | ) | |||||
Losses related to ZIM | (728 | ) | - | |||||
Share in profit/(losses) of associated companies, net | ||||||||
- ZIM | 1,033 | 1,261 | ||||||
- OPC’s associated companies | 85 | (11 | ) | |||||
Profit before income taxes | 388 | 880 | ||||||
Income tax expense | (38 | ) | (5 | ) | ||||
Profit for the period | 350 | 875 | ||||||
Attributable to: | ||||||||
Kenon’s shareholders | 313 | 930 | ||||||
Non-controlling interests | 37 | (55 | ) | |||||
Profit for the period | 350 | 875 | ||||||
Basic/diluted profit per share attributable to Kenon’s shareholders (in dollars): | ||||||||
Basic/diluted profit per share | 5.80 | 17.27 |
Kenon Holdings Ltd. and its subsidiaries
Consolidated Statements of Cash Flows for the years ended December 31, 2022 and 2021
Consolidated Statements of Cash Flows for the years ended December 31, 2022 and 2021
For the year ended December 31, | ||||||||
2022 | 2021 | |||||||
$ millions | ||||||||
Cash flows from operating activities | ||||||||
Profit for the period | 350 | 875 | ||||||
Adjustments: | ||||||||
Depreciation and amortization | 63 | 58 | ||||||
Financing expenses, net | 5 | 141 | ||||||
Share in profit of associated companies, net | (1,118 | ) | (1,250 | ) | ||||
Losses related to Qoros | - | 251 | ||||||
Losses related to ZIM | 728 | - | ||||||
Share-based payments | 20 | 18 | ||||||
Income tax expense | 38 | 5 | ||||||
86 | 98 | |||||||
Change in trade and other receivables | (29 | ) | (1 | ) |
Change in trade and other payables | (11 | ) | - | |||||
46 | 97 | |||||||
Dividends received from associated companies | 727 | 143 | ||||||
Income taxes paid | (2 | ) | - | |||||
Net cash provided by operating activities | 771 | 240 |
Kenon Holdings Ltd. and its subsidiaries
Consolidated Statements of Cash Flows for the years ended December 31, 2022 and 2021, continued
Consolidated Statements of Cash Flows for the years ended December 31, 2022 and 2021, continued
For the year ended December 31, | ||||||||
2022 | 2021 | |||||||
$ millions | ||||||||
Cash flows from investing activities | ||||||||
Short-term deposits and restricted cash, net | (46 | ) | 558 | |||||
Short-term collaterals deposits, net | (19 | ) | - | |||||
Investment in long-term deposits, net | 13 | 52 | ||||||
Purchase of other investments | (651 | ) | - | |||||
Proceeds from sale of other investments | 309 | - | ||||||
Long-term advance deposits and prepaid expenses | (11 | ) | (7 | ) | ||||
Long-term loans to an associate | - | (5 | ) | |||||
Acquisition of subsidiary, less cash acquired | - | (659 | ) | |||||
Acquisition of associated company, less cash acquired | (3 | ) | (9 | ) | ||||
Acquisition of property, plant and equipment | (260 | ) | (231 | ) | ||||
Acquisition of intangible assets | (10 | ) | (1 | ) | ||||
Reimbursement of right-of-use asset | - | 5 | ||||||
Interest received | 6 | - | ||||||
Payment of transactions in derivatives, net | 1 | (6 | ) | |||||
Proceeds from distribution from associated companies | 4 | 47 | ||||||
Proceeds from sales of interest in ZIM | 464 | 67 | ||||||
Payment of financial guarantee | - | (16 | ) | |||||
Net cash used in investing activities | (203 | ) | (205 | ) | ||||
Cash flows from financing activities | ||||||||
Dividends paid to holders of non-controlling interests | - | (10 | ) | |||||
Cash distribution and dividends paid | (741 | ) | (100 | ) | ||||
Investments of holders of non-controlling interests in the capital of a subsidiary | 37 | 197 | ||||||
Costs paid in advance in respect of taking out of loans | (3 | ) | (5 | ) | ||||
Payment of early redemption commission with respect to the debentures | - | (76 | ) | |||||
Payment in respect of derivative financial instruments, net | (1 | ) | (14 | ) | ||||
Proceeds from issuance of share capital by a subsidiary to non-controlling interests, net of issuance expenses | 193 | 142 | ||||||
Proceeds from long-term loans | 102 | 343 | ||||||
Proceeds from issuance of debentures, net of issuance expenses | - | 263 | ||||||
Repayment of long-term loans, debentures and lease liabilities | (56 | ) | (562 | ) | ||||
Interest paid | (25 | ) | (31 | ) | ||||
Net cash (used in)/provided by financing activities | (494 | ) | 147 | |||||
Increase in cash and cash equivalents | 74 | 182 | ||||||
Cash and cash equivalents at beginning of the year | 475 | 286 | ||||||
Effect of exchange rate fluctuations on balances of cash and cash equivalents | (14 | ) | 7 | |||||
Cash and cash equivalents at end of the period | 535 | 475 |
Information regarding reportable segments
Information regarding activities of the reportable segments are set forth in the following table.
For the year ended December 31, 2022 | ||||||||||||||||||||
OPC Israel | CPV Group | ZIM | Other | Consolidated Results | ||||||||||||||||
$ millions | ||||||||||||||||||||
Revenue | 517 | 57 | - | - | 574 | |||||||||||||||
Depreciation and amortization | (47 | ) | (16 | ) | - | - | (63 | ) | ||||||||||||
Financing income | 10 | 25 | - | 10 | 45 | |||||||||||||||
Financing expenses | (42 | ) | (7 | ) | - | (1 | ) | (50 | ) | |||||||||||
Losses related to ZIM | - | - | (728 | ) | - | (728 | ) | |||||||||||||
Share in profit of associated companies | - | 85 | 1,033 | - | 1,118 | |||||||||||||||
Profit/(loss) before taxes | 24 | 61 | 305 | (2 | ) | 388 | ||||||||||||||
Income tax expense | (10 | ) | (10 | ) | - | (18 | ) | (38 | ) | |||||||||||
Profit/(loss) for the period | 14 | 51 | 305 | (20 | ) | 350 | ||||||||||||||
Adjusted EBITDA | 103 | (26 | ) | - | (11 | ) | 66 |
For the year ended December 31, 2021 | ||||||||||||||||||||
OPC Israel | CPV Group | ZIM | Other | Consolidated Results | ||||||||||||||||
$ millions | ||||||||||||||||||||
Revenue | 437 | 51 | - | - | 488 | |||||||||||||||
Depreciation and amortization | (44 | ) | (13 | ) | - | (1 | ) | (58 | ) | |||||||||||
Financing income | 3 | - | - | - | 3 | |||||||||||||||
Financing expenses | (119 | ) | (25 | ) | - | - | (144 | ) | ||||||||||||
Loss related to Qoros | - | - | - | (251 | ) | (251 | ) | |||||||||||||
Share in profit of associated companies | - | (11 | ) | 1,261 | - | 1,250 | ||||||||||||||
(Loss)/profit before taxes | (57 | ) | (61 | ) | 1,261 | (263 | ) | 880 | ||||||||||||
Income tax benefit/(expense) | 10 | 14 | - | (29 | ) | (5 | ) | |||||||||||||
(Loss)/profit for the period | (47 | ) | (47 | ) | 1,261 | (292 | ) | 875 | ||||||||||||
Adjusted EBITDA | 104 | (13 | ) | - | (12 | ) | 80 |
Information regarding associated companies
Carrying amounts of investment in associated companies | Equity in the net profit / (losses) of associated companies | |||||||||||||||
as at | for the year ended | |||||||||||||||
December 31, | December 31, | December 31, | December 31, | |||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
$ millions | $ millions | |||||||||||||||
CPV Fairview LLC | 199 | 173 | 24 | 1 | ||||||||||||
CPV Maryland LLC | 69 | 61 | 9 | 3 | ||||||||||||
CPV Shore Holdings LLC | 87 | 75 | 6 | 10 | ||||||||||||
CPV Towantic LLC | 130 | 112 | 12 | 5 | ||||||||||||
CPV Valley Holdings LLC | 94 | 58 | 35 | (29 | ) | |||||||||||
CPV Three Rivers LLC | 69 | 64 | (1 | ) | (1 | ) | ||||||||||
Others | 4 | 2 | - | - | ||||||||||||
652 | 545 | 85 | (11 | ) | ||||||||||||
ZIM | 427 | 1,354 | 1,033 | 1,261 | ||||||||||||
1,079 | 1,899 | 1,118 | 1,250 |
Summary of OPC consolidated financial information
OPC’s Consolidated Statements of Profit or Loss
For the year ended December 31, | ||||||||
2022 | 2021 | |||||||
$ millions | ||||||||
Revenue | 574 | 488 | ||||||
Cost of sales (excluding depreciation and amortization) | (417 | ) | (337 | ) | ||||
Depreciation and amortization | (57 | ) | (53 | ) | ||||
Gross profit | 100 | 98 | ||||||
Selling, general and administrative expenses | (86 | ) | (64 | ) | ||||
Operating profit | 14 | 34 | ||||||
Financing expenses | (49 | ) | (144 | ) | ||||
Financing income | 35 | 3 | ||||||
Financing expenses, net | (14 | ) | (141 | ) | ||||
Share in profit/(losses) of associated companies, net | 85 | (11 | ) | |||||
Profit/(loss) before income taxes | 85 | (118 | ) | |||||
Income tax (expense)/benefit | (20 | ) | 24 | |||||
Profit/(loss) for the period | 65 | (94 | ) | |||||
Attributable to: | ||||||||
Equity holders of the company | 50 | (68 | ) | |||||
Non-controlling interest | 15 | (26 | ) | |||||
Profit/(loss) for the period | 65 | (94 | ) |
Summary Data from OPC’s Consolidated Statement of Cash Flows
For the year ended December 31, | ||||||||
2022 | 2021 | |||||||
$ millions | ||||||||
Cash flows provided by operating activities | 63 | 119 | ||||||
Cash flows used in investing activities | (329 | ) | (256 | ) | ||||
Cash flows provided by financing activities | 286 | 311 | ||||||
Increase in cash and cash equivalents | 20 | 174 | ||||||
Cash and cash equivalents at end of the period | 241 | 243 |
Summary Data from OPC’s Consolidated Statement of Financial Position
As at | ||||||||
December 31, 2022 | December 31, 2021 | |||||||
$ millions | ||||||||
Total financial liabilities1 | 1,163 | 1,215 | ||||||
Total monetary assets2 | 287 | 264 | ||||||
Investment in associated companies | 652 | 545 | ||||||
Total equity attributable to the owners | 997 | 730 | ||||||
Total assets | 2,709 | 2,488 |
1. | Including loans from banks and others and debentures |
2. | Including cash and cash equivalents, term deposits and restricted cash |
Definition of OPC’s Adjusted EBITDA and share of EBITDA of its associated companies and non-IFRS reconciliation
This press release, including the financial tables, presents OPC’s Adjusted EBITDA and share of EBITDA of its associated companies, which are non-IFRS financial measures.
OPC EBITDA is defined for each period as net profit before depreciation and amortization, financing expenses, net, and income tax expense and Adjusted EBITDA is defined as net profit before depreciation and amortization, financing expenses, net, income tax expense and share of profits or losses of associated companies, net. EBITDA and Adjusted EBITDA are 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 and Adjusted EBITDA are 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 and Adjusted EBITDA as measures 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 and share of EBITDA of its associated companies provide useful information to investors and financial analysts in their review of the company’s, its subsidiaries’, and its associated companies’ 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 are reconciliations of OPC’s net profit to Adjusted EBITDA and share of net profit or losses to share of EBITDA of its associated companies for the periods presented. Other companies may calculate EBITDA and Adjusted EBITDA differently, and therefore this presentation of EBITDA and Adjusted EBITDA may not be comparable to other similarly titled measures used by other companies.
For the year ended December 31, | ||||||||
2022 | 2021 | |||||||
$ millions | ||||||||
Net profit/(loss) for the period | 65 | (94 | ) | |||||
Depreciation and amortization | 63 | 57 | ||||||
Financing expenses, net | 14 | 141 | ||||||
Share in (profit)/losses of associated companies, net | (85 | ) | 11 | |||||
Income tax expense/(benefit) | 20 | (24 | ) | |||||
Adjusted EBITDA | 77 | 91 |
For the year ended December 31 | ||||||||
2022 | 2021 | |||||||
$ million | ||||||||
Share in profit/(losses) of associated companies, net | 85 | (11 | ) | |||||
Share of depreciation and amortization | 44 | 39 | ||||||
Share of financing expenses, net | 39 | 78 | ||||||
Proportionate share of EBITDA of associated companies | 168 | 106 |
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 December 31, 2022 and December 31, 2021 (in $ millions):
As at December 31, 2022 | OPC Energy | OPC-Rotem | OPC-Hadera | OPC-Tzomet | CPV Keenan | Others | Total | |||||||||||||||||||||
Debt (including accrued interest) | 527 | - | 190 | 237 | 88 | 1 | 1,043 | |||||||||||||||||||||
Cash and cash equivalents | 166 | 7 | 2 | 3 | 1 | 98 | 277 | |||||||||||||||||||||
Restricted cash (including debt service reserves) | - | - | 14 | - | - | - | 14 | |||||||||||||||||||||
Net debt* | 361 | (7 | ) | 174 | 234 | 87 | (97 | ) | 752 |
As at December 31, 2021 | OPC Energy | OPC-Rotem | OPC-Hadera | OPC-Tzomet | CPV Keenan | Others | Total | |||||||||||||||||||||
Debt (including accrued interest) | 587 | 219 | 170 | 98 | 2 | 1,076 | ||||||||||||||||||||||
Cash and cash equivalents | 86 | 17 | 7 | 24 | 1 | 99 | 234 | |||||||||||||||||||||
Restricted cash (including debt service reserves) | - | - | 14 | - | - | - | 14 | |||||||||||||||||||||
Net debt* | 499 | (17 | ) | 198 | 146 | 97 | (97 | ) | 826 |
*Net debt is defined as debt minus cash and cash equivalents and deposits and restricted cash.
Definition of ZIM’s Adjusted EBITDA and non-IFRS reconciliation
This press release, including the financial tables, presents ZIM’s Adjusted EBITDA, which is a non-IFRS financial measure.
ZIM defines Adjusted EBITDA as for each period as net profit before depreciation and amortization, financing expenses, net, income tax expense, non-cash charter hire expenses, capital gains beyond the ordinary course of business and expenses related to legal contingencies. 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 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 Adjusted EBITDA enables the comparison of operating performance between periods on a consistent basis. This measure should not be considered in isolation, or as a substitute for operating income, any other performance measure, or cash flow data, which were prepared in accordance with IFRS as measures of profitability or liquidity. 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 Adjusted EBITDA for the periods presented.
For the year ended December 31, | ||||||||
2022 | 2021 | |||||||
$ millions | ||||||||
Net profit for the period | 4,629 | 4,649 | ||||||
Depreciation and amortization | 1,396 | 780 | ||||||
Financing expenses, net | 109 | 157 | ||||||
Income tax expense | 1,398 | 1,010 | ||||||
EBITDA | 7,532 | 6,596 | ||||||
Non-cash charter hire expenses | - | (1 | ) | |||||
Capital gains beyond the ordinary course of business | (1 | ) | - | |||||
Expenses related to legal contingencies | 10 | 2 | ||||||
Adjusted EBITDA | 7,541 | 6,597 |