AY - Earnings call transcript Q3 2020 | Atlantica Sustainable Infrastructure plc

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Operator

Welcome to the Atlantica's Third Quarter 2020 Financial Results Conference Call. Atlantica is a sustainable infrastructure company that owns a diversified portfolio of contracted renewable energy, power generation, electric transmission and water assets in the North and South America and certain markets in EMEA.

Just a reminder that this call is being webcast live on the Internet and a replay of this call will be available at the Atlantica's corporate website. Atlantica will be making forward-looking statements during this call, based on current expectations and assumptions, which are subject to risks and uncertainties. Actual results could differ materially from our forward-looking statements. Risk key in incorrect because our today's factors can in on our other because of found latest of the be Commission, discussed discussed of each with factors earnings the and reports any and assumptions or website. the or are of other accompanying filings If presentation section Securities on Exchange Factors our presentation which or of undertake not update duty any statements. does Atlantica any to forward-looking

Seage; call conference Francisco are today's and for Santiago CFO, CEO, us Joining Martinez-Davis. Atlantica's

As the will of I conference open to ahead, the the pass session. go Mr. now usual, Q&A sir. end at call, Seage. Please, lines we for will over the

Santiago Seage

opening presentation continued showing everybody. In XXXX. Thank for very conference third we joining remarks you of first in takes place, believe our of we few positive XXXX third before with over the performance much very the Francisco good results. the morning, a is Thanks quarter what A and call. quarter

announced distribution nearly growth the first available nine same our CAFD important If million. bit at look And cash more that on to we compared reaching XX% place, we $XXX X.X% quarter months second last than is increased of the by million finally, $XX it for XXXX In progress in months has the we nine making XXXX, versus Our accretive a we reaching year. year-on-year, has of cash previously. mention existing increased through $XXX as of by assets first one-off of continue million around generated initiatives. non-recourse refinancings

as anticipated. Solana the First, buyout, investor third we closed quarter, the equity during tax

approvals acquire and Closing in subject a we to customary regulators. signed is to to a heating district asset purchase Canada. Second, have a still conditions by agreement

we invested With results. every and expect will target turn have we that, million with of the our call $XXX million equity for continue the over announced who investment $XXX year. to target additional $XXX of financial maintaining to to capturing we the opportunities, have Francisco million or XXXX, investments growth over in Third, I cover

Francisco Martinez-Davis

morning Santiago. you, all. Good Thank to

five, unconsolidated Spain by mostly our a will nine same to Revenue in present decrease previous turn please and triggered decrease XXXX financials including decreased XXXX. million, period $XXX versus in EBITDA, to resource X.X% the was slide solar million. outage number unscheduled was in by and The in nine Now production adjusted to the for affiliates, where $XXX lower months. reached the X.X% -- lower first due the months first I of in Kaxu key And quarters. discussed

XXXX, months X.X% a $XXX XXXX. the of generated Regarding million in XXXX to in the $XXX.X increase an generation period in CAFD, with compared we quarter the of close first same third million XX% million. This $XX to nine driving of increase year-over-year, of CAFD represents

In distribution, growth addition cash for cash and debt one-off nine first being in the million we months refinancings, in cash finance to to is debt. through flow of cancellation. reserves project increasing used transaction our XXXX net costs, This rate without swap interest corporate $XXX of available generated three

In and -- solid revenue X% despite smoke assets number our quarter XXXX. in of performance decrease South EBITDA America, performance slide production reduction months due the by is nine In X%, North primarily both by This assets solar revenue segment, X% months first in X to turn to of caused a third from please the and and performance continued our in in and quarter higher wind radiation revenue In of of our increased our levels the of geography. America, natural non-cash assets increased decreased from and production thanks nine wildfires. now Let's solar by the America, high to the review ACT the caused adjustment thanks and to California revenue assets. accounting caused with North to solar in The Spain first recently a respectively, lower due into lower radiation to also to by in in in gas XXXX. the Mojave, in in previously levels by a solar revenue onetime acquired XXXX, due sector contribution of compared better first by and production region from the to the unscheduled in lines Kaxu mentioned. mainly EMEA transmission outage was availability EBITDA decreased efficient

effects. gas we the to sector, our business to renewable continued decreased by results And show and efficient the previously assets at solid similar performance. Mexican natural revenue energy, In can below due Looking see reasons EBITDA mentioned.

water with can transmission the months quarter continue of availability look number finally, XX% assets. good XXXX. by in consolidate of the our respectively increased the due EBITDA And to hours nine our operational increase Tenes we that we gigawatt in plant XX% to of Our second by first and the renewable segment in show at review and our acquisitions started Electricity to key from the assets the revenue slide lines contribution together we very levels revenue water and X,XXX explain X, EBITDA. XXXX. decelerization produced the in following reached metrics If that now

transmission high on our at two achieve other XXX%. continue revenue contracts, our around availability, where levels again showing availability based solid we lines to is ACT performance. and once water Looking And keeps sectors in availability-based finally, the

flow to move slide X XXXX. the months now to nine walk you of through Let's for first our cash

by slight in cash first XXXX lower the period and negative to reached nine interest partially lower showing for $XXX capital EBITDA months less a paid. same of of operating XXXX. The million, working flow the decrease variation compared offset Our a was

the million. for financing the of of months XXXX, in an million the included XXXX project refinancings dividend this in of first interest also perspective, in payments investor corporate approximately cash All tax Solana. $XXX paid an first approximately From as the $XXX flow months Financing addition, accounting acquisition equity million. net $XXX debt in debt all, in year for nine increase scheduled nine and approximately is the the was from net flow. project of amount change proceeds and classified financings, of debt consolidated In cash we the our cash repayments

On of significant slide would the our net million, debt corporate next number nine at closed maturities able have pre-corporate of increase $XXX corporate debt ratio closed refinancings And Thanks and to debt we until nine completing corporate first been any don't with the extend the CAFD XXXX. XXXX, debt today net our stood service to corporate the the X.X to debt we the months times. of in months have after first maturities. project like debt investment. net we this, an review We position. XXXX our With Solana to X,

debt of approximately XXXX. September average X.X Our corporate was maturity years as XX

the accrued will call to the was debt consolidated million by we new $XXX to the to million. due December now hand potential available, of increase facility interest, together to acquisitions. corporate amortization. now more addition, million entire as XXXX scheduled cash on XX, finance XX, debt Net nonrecourse of XXXX which total amount of The credit revolving assets $XXX the In $XXX with partially refinancings Santiago. back available I project turn $X,XXX respect September data project the mainly of and offset of principal million debt than represents our have our liquidity with in a period, was

Santiago Seage

you Thank much very Francisco.

Let's investments. talk now about growth and

Solana. the investor interest of equity have our closed As previously acquisition we in mentioned, tax

of district and we asset year-to-date, With Canada. the have previously reached in for addition, reached an XXXX we announced In a heating in have acquisition million. $XXX agreement investments that around

region year in to Obviously As the be potential we this opportunities, more we of at $XXX strong to will year. million it continue pipeline a equity than target million currently see investments of that. least $XXX investment per

district us. sector and with revenues It It a reduce provides heating with in of contract heating If you has indexation new high high a is services a it our look as first investment measure The The asset quality believe including as represents know is different asset you of number for on types growth wide average barriers at availability obviously emissions. an XX, of you cities range to take and inflation a years heating, life. overview the asset, credit opportunity Calgary. clients, entry recognized slide of in district XX infrastructure a based asset have number essential for is to to a clients. key which we weighted

We closing to signed obviously subject customary the purchase is agreement, and approvals. conditions have and regulatory

that that, will your whenever attention. want and note, see you for approved Additionally Directors dividend of our can for today's the of lines we Thanks now Q&A. $X.XX you the Board Operator, quarterly annualized. are presentation. a share per ready third quarter we for as for we conclude And a questions. has final $X.XX open or With

Operator

of Julien America. first question comes Your the Instructions] from [Operator ahead. you. Dumoulin-Smith go Bank Please line Thank of from

Your now open. line is

Julien Dumoulin-Smith

are all doing Hey, time. Thanks good you for Hope morning. well.

Santiago Seage

Good morning.

Julien Dumoulin-Smith

then what If you. can however about growth for can it? obviously, district to this that. relative kind talk do investments? seems you is related metrics And on about IRR, describe million yield how target your transaction, to this It Thank a X/XX you annual of CAFD you whether to that, the provide think a Absolutely. of $XXX about smaller to of million want some this transaction we $XXX kind side,

is quarter of kind this in? something -- of feather here these we should every expect that to smaller-type So investments just some

Santiago Seage

Thanks, Julien.

equity year a investor question. So transactions. investments you combination you it see starting our -- The second this year, your the with combined look larger have some Solana transactions. at we was way This tax if with that smaller of

again combination. our going investment $XXX forward, million to million yearly should a So $XXX be

call $XXX of the transactions, investments terms issue asset. both a in it's an larger within. we terms we contracts recontracted XX from expire no $XXX of average to view, what it difference of that order accretion that is of if this our on believe also an the point But and main can growth investment CAFD potential million permanent to And we fits now point and as a view, making criteria right. today. from IRR are our believe smaller we or will then. reach would asset be generation have is From obviously, have in It's years in has that, We metrics every in numbers

that So it provides the is well to. assets a is a it's some we than believe used contracted profile new longer category, of us. to as clearly our in category and a for our we cash that intention are grow And market fits other visibility very that

Julien Dumoulin-Smith

Pemex there've with lot front the that a Got here come what's I of know about to deal the it. PTS Excellent. you just factors on line resolution? to time here? some kind When been of think that

Santiago Seage

and an control because been cannot cannot it. number close today. because to going I it's of met We an if have it's delayed answer you been we as cannot -- it's it we of and even give not that depends happening on therefore a do parties that conditions things cannot investment control the And be So not sure control. about has we because third timing the

Julien Dumoulin-Smith

Excellent. more when And reconfirming for the the lastly just line here broadly subject of time dividend and me, here? then for on reengage we'll growth growth

Santiago Seage

there? Julien question the What's

Julien Dumoulin-Smith

targets? Just just we longer-term updates I to on reconfirm when expect there? dividend can the growth timeline want

Santiago Seage

So from our as probably guidance know and we we to that's results, time point present the would about of the yearly midterm. give And be guidance you right the typically, year talk that short February. for when view

Julien Dumoulin-Smith

that. Thank a guys. reconfirming you, Just Have great day.

Santiago Seage

Great. Thank you.

Francisco Martinez-Davis

you, Thank Julien.

Operator

you. Thank

from line comes from Raymond question David the next go James. Quezada ahead. of Please Your

Your now line is open.

David Quezada

morning, Good Thanks. everyone.

Santiago Seage

morning, David. Good

David Quezada

new opportunities emerging maybe jurisdictions provide into color any opportunities? potential see have Are promising My you climate wondering just few Europe, you there? the talk provides that about I morning. got any I'm before? in if assets up do in that since a any you And first as any going that soon. on might could can there question coming the you if And if just Good law mean, weren't just here region. consider we've European quite you

Santiago Seage

administrations I In impacts I make the and few So one let's are that would COVID say, comments opportunities around are you there given world situation a to going we global of and believe doing, to be what believe the there. similar we that the would say general, the described.

can Union. We becoming It's something you Europe should there's not it's being going So are Europe. us happens, launched opportunities. large believe administrations the as around But good the to it's infrastructure. still that In how believe our example there. I play whenever for reality perhaps U.S. But those we be market Europe, some it's along for early aware capture going on that sustainable what a in should depending and good lines we regarding a could it for be initiatives or clearly one way there what and in mean, say another. able work we be to to European be by efforts stages role only in launching and maybe happens program

we pushing way jurisdictions administrations another. do several one believe in or sustainable be infrastructure So should with that there opportunities

David Quezada

Calgary follow-up could great and question And deal whether of Algonquin I'm a came that or relationship to it then district bidding -- on about was just competitive That's about was maybe you heating. the the it through how outside just color. if talk wondering a it that situation? whether

Santiago Seage

the It by our it was a with seller. run main competitive shareholder but situation. collaborated a was We process obviously there

David Quezada

Okay.

And question enough. Fair Okay. there. then a guess related maybe I

valuation, I better lately. your that the has continues. mean as stock been doing And Just hopefully

or As of gets guess growth think an And front? for potential do resume your capital, from see on I you guess that Algonquin? that cost do AAGES you lower could increased that drop-downs I

Santiago Seage

our those We opportunities. doing mentioned creating We for that In that let's the price And Yes. view general, as helps. homework are growth some from have opportunities. stock we we also believe market opportunities. fairly of been point are optimistic a time there believe regarding say you

do are hopefully we opportunities mentioning relationship from we that the believe with use to capture the one the we going sources you're So Algonquin/AAGES. all including

David Quezada

Okay. I Thank you very get queue. will in the back much.

Santiago Seage

Thank you.

Operator

question ahead. go next Seaport comes of Global. the Angie from line Storozynski Please Our from

now is open. line Your

Angie Storozynski

morning. Good

Does a interesting have the CAFD is do you you location? asset. heating look share mean CAFD acquisition at question yield it potential strict or I have to accretion definitely as to any So the I very down targets? a per preference just how acquisition come about the

going water from said traditional it past assets. like maybe you seems and But away the As some of expansion in we're It somewhat in solar the you wind renewables. the mentioned model. Yieldco sits desal

And as with if mix again, you preference the any wondering have so to proceed you as just strategies? if asset growth

Santiago Seage

are contracts only track that and that long solar. and number of think as in we opportunities as sectors to Yes. have we creates good we positive No assets and exposed you. Thank not good I wind general, think but operational as -- good different wind a and know including you the that's And more solar, off-takers record.

in happy sectors investing are We geographies. different and different

point So that from of we open. are view

well our year be the do should Now because we typically most investments that of will compete. in in we therefore the realistic, are less we are being expect those you mean example. to are that larger times in which we that markets other some many investing doesn't continue majority investments solar. taking sectors of those in of going fact than be other to happen in when solar expect shy cases But others any And the or that wind were know sectors where wind And and in we advantage for competitive. mentioning and transmission continue our lines

Angie Storozynski

geographic in have How about but... mean Does matter? that mix? did acquisition I Solana a you

Santiago Seage

Yes.

we having one Our geographical similar expectation a to have continue today. to is the mix

to But America investing So core. be the maintain investments should more be as would or North we America our less. well South some We in Western mix be in in Europe. should our dollars have expectation broadly

we we a bit today. we've year probably In own we pipeline portfolio of fact look resembles done have, that. the it the the last at during And when

Angie Storozynski

was were I transaction Okay. the smaller to that I understand the be PTC in could And the on – providing – are building slew replenish or PTS that actually on CAFD to project close meaning you you're call. question, my going have fourth case to of PTC that you that contingencies the mean, projects some not acquisition fully last But well contribution a the targets quarter those have? guidance

Santiago Seage

million with of asset we specific Well, invest to is in without obviously, or this $XXX the case we – that's to plan. And PTS. part a the million target have what $XXX any

the happen active to compensate, to looking is if very before mentioned being able didn't be control as I because at don't that we continue we it. reality opportunities So

Angie Storozynski

you. Thank good. Very

Santiago Seage

to Thanks you.

Operator

Thank There this no are continue. at further you. questions Please time.

Santiago Seage

we If the we lines. have operator, no would close more questions,

further Okay, you are can no verify that there questions?

Operator

There further are no questions.

Santiago Seage

Great.

you thank much nice very day. a to Have So everyone.

Francisco Martinez-Davis

you. Bye-bye. Thank

Operator

our today. conclude does That participating. you for for conference Thank

You may disconnect. all now

Atlantica Sustainable Infrastructure (AY) 6 Nov 202020 Q3 Earnings call transcript