Ellomay Capital Reports Results for the Three and Six Months Ended June 30, 2020
TEL AVIV, Israel, Sept. 24, 2020 /PRNewswire/ -- Ellomay Capital Ltd. (NYSE American: ELLO) (TASE: ELLO) ("Ellomay" or the "Company"), a renewable energy and power generator and developer of renewable energy and power projects in Europe and Israel, today reported its unaudited financial results for the three and six month periods ended June 30, 2020.
Financial Highlights
-- Revenues were approximately EUR4.2 million for the six months ended June
30, 2020, compared to approximately EUR10.3 million for the six months
ended June 30, 2019. The decrease in revenues is mainly due to the sale
of ten Italian indirectly wholly-owned subsidiaries of the Company,
which held twelve photovoltaic plants in Italy with an aggregate
installed capacity of approximately 22.6 MWp (the "Italian PV
Portfolio"), during December 2019. A small portion of the decrease in
revenues for the six months ended June 30, 2020 resulted from the
decrease in demand and prices of the European electricity markets due to
the Covid-19 crisis. In addition, in February 2020 a strong storm hit
one of the Company's biogas facilities in the Netherlands, causing the
facility to be partially deactivated. The damage repair and return of
the facility to full activity took approximately eight weeks (as the
process of returning to full biological facility output is gradual) and
in May 2020 the facility returned to full operation.
-- Operating expenses were approximately EUR2.1 million for the six months
ended June 30, 2020, compared to approximately EUR3.5 million for the
six months ended June 30, 2019. The decrease in operating expenses is
mainly attributable to the sale of the Italian PV Portfolio, to
increased operational efficiency of the Company's Waste-to-Energy
projects in the Netherlands and to insurance reimbursement in connection
with the storm damages in one of our biogas facilities in the
Netherlands that reduced operating expenses. Depreciation expenses were
approximately EUR1.4 million for the six months ended June 30, 2020,
compared to approximately EUR3 million for the six months ended June 30,
2019. The decrease reflects the sale of the Italian PV Portfolio.
-- Project development costs were approximately EUR2.3 million for the six
months ended June 30, 2020, compared to approximately EUR2.7 million for
the six months ended June 30, 2019. The decrease in project development
costs is mainly due to a decrease in consultancy expenses in connection
with the project to construct a 156 MW pumped storage hydro power plant
in the Manara Cliff, Israel, partially offset by consultancy expenses in
connection with the development of photovoltaic projects in Italy.
-- General and administrative expenses were approximately EUR2.2 million
for the six months ended June 30, 2020, compared to approximately EUR1.9
million for the six months ended June 30, 2019. The increase is mostly
due to D&O liability insurance costs.
-- Company's share of profits of equity accounted investee, after
elimination of intercompany transactions, was approximately EUR0.9
million for the six months ended June 30, 2020, compared to
approximately EUR0.03 million in the six months ended June 30, 2019. The
increase in the Company's share of profit of equity accounted investee
is mainly attributable to lower financing expenses incurred by Dorad
Energy Ltd. for the period as a result of the CPI indexation of loans
from banks.
-- Financing expenses, net was approximately EUR1.1 million for the six
months ended June 30, 2020, compared to approximately EUR3.1 million for
the six months ended June 30, 2019. The decrease in financing expenses,
net, was mainly due to: (i) income recorded in connection with the
reevaluation of the Company's euro/US$ forward transactions and
revaluation of Dori Energy loan in the aggregate amount of approximately
EUR1.1 million during the six months ended June 30, 2020, compared to
approximately EUR0.5 million during the six months ended June 30, 2019,
(ii) decreased expenses resulting from exchange rate differences
amounting to approximately EUR0.9 million in six months ended June 30,
2020, mainly in connection with the New Israeli Shekel ("NIS") cash and
cash equivalents, compared to approximately EUR1.3 million for the six
months ended June 30, 2019, mainly in connection with the Company's NIS
denominated debentures, caused by the 0.1% appreciation of the euro
against the NIS during the six months ended June 30, 2020, compared to
the 5.4% devaluation of the euro against the NIS during the six months
ended June 30, 2019 and (iii) a decrease in financing expenses of
approximately EUR0.9 million resulting from the early repayment of the
Company's Series A Debentures and the sale of the Italian PV Portfolio,
including all related project finance.
-- Taxes on income was approximately EUR0.1 million for the six months
ended June 30, 2020, compared to approximately EUR0.5 million for the
six months ended June 30, 2019. The decrease in tax expenses is mainly
attributable to the sale of the Italian PV Portfolio and deferred tax
income related to the operations of the project company constructing a
photovoltaic plant with a peak capacity of 300MW in the Spain, in which
the Company holds 51%.
-- Net loss was approximately EUR4.3 million for the six months ended June
30, 2020, compared to approximately EUR4.4 million for the six months
ended June 30, 2019.
-- Total other comprehensive loss was approximately EUR9.2 million for the
six months ended June 30, 2020, compared to a profit of approximately
EUR0.5 million for the six months ended June 30, 2019. The change was
mainly due to changes in fair value of cash flow hedges and from foreign
currency translation differences on NIS denominated operations, as a
result of fluctuations in the euro/NIS exchange rates.
-- Total comprehensive loss was approximately EUR13.5 million for the six
months ended June 30, 2020, compared to approximately EUR4.9 million for
the six months ended June 30, 2019.
-- EBITDA was approximately EUR(1.6) million for the six months ended June
30, 2020, compared to approximately EUR2.3 million for the six months
ended June 30, 2019.
-- Net cash used in operating activities was approximately EUR1.9 million
for the six months ended June 30, 2020, compared to net cash provided by
operating activities of approximately EUR1.1 million for the six months
ended June 30, 2019. The decrease in net cash from operating activities
is mainly attributable to the sale of the Italian PV Portfolio.
-- As of September 1, 2020, the Company held approximately EUR52 million in
cash and cash equivalents, approximately EUR8 million in short-term
deposits, approximately EUR0.8 million in marketable securities and
approximately EUR10.6 million in restricted short-term and long-term
cash.
-- On September 24, 2020, the Company's Board of Directors approved an
extension to the previously announced plan to repurchase the Company's
debentures in an aggregate amount of up to NIS 15 million for an
additional six-month period. The timing, volume and nature of
repurchases will be at the sole discretion of management and will depend
on market conditions, the price and availability of the Company's
debentures, and other factors. No assurance can be given that any
particular amount of debentures will be repurchased and the repurchase
plan does not obligate the Company to acquire a specific amount of
debentures in any period.
-- As noted above, the revenues for the six months ended June 30, 2020 were
impacted by the decrease in demand and market prices of electricity in
Spain resulting from the Covid-19 pandemic. Although the Company's
operations have not thus far been materially adversely affected by the
pandemic, the Company's operations, including, but not limited to, its
results of operations, ability to raise capital and ability to develop
new projects, may in the future be adversely affected by the
implications of the spread of Covid-19 in Israel, Europe and worldwide.
These potential affects could last until a vaccine or successful
treatment plan are developed and implemented worldwide.
Second Quarter 2020 CEO Review
Ran Fridrich, CEO and a board member of the Company, provided the following CEO review:
-- The spreading of the Covid-19 pandemic during the last six months posed
new challenges for the company and its employees. Despite those
challenges, due to our presence in each of the countries in which we
operate through our representatives, and thanks to an efficient and
tight management and control system, the development of projects in
Europe continued at a rapid pace and was not halted. While meeting the
schedule and without exceeding the budget. The Talasol project, which is
one of the largest mega-projects built in Europe in the past year, is on
the verge of completion of the construction process, meeting the
schedule and without exceeding the budget.
-- The 2(nd) quarter was characterized by the continued development
momentum of various projects in the field of renewable energy. The
Italian PV portfolio under advanced development continued to grow and
currently 242 MW are already in advanced permitting stages.
-- In Spain, a 28 MW PV project is expected to receive the final permits in
the near future and commence construction. The Company received bids
from several contractors and the contractor selection process is in its
final stages.
-- The Company won a quote of 20 MW of PV and battery storage in a tender
published by the Israeli Electricity Authority. The project involves the
construction of 40 MW PV and 80 MW of battery storage capacity (20MW
times 4 hours storage).
-- As of today, Talasol's construction is on the verge of completion and
the operating permit has been obtained. This permit is the final permit
issued by the government, and once obtained the guarantees provided upon
receipt of the building permit will be released. The process of
connection to the grid, which is expected to take between 5-7 weeks, is
expected to commence shortly.
-- The operational improvement of the biogas facilities in the Netherlands
continues. During September 2020 a CHP system was installed in the Oude
Tonge facility, which will allow cheap electricity generation for
self-consumption and utilization of the residual heat and receipt of
subsidies accordingly. The output in the last three months represents
100% production and the facility is approaching full alignment with the
business plan. The Goor facility is in line with production targets and
business plan for the last several months. Further improvements are
planned, which are expected to enable increased production and a
reduction of costs in our existing facilities.
Use of NON-IFRS Financial Measures
EBITDA is a non-IFRS measure and is defined as earnings before financial expenses, net, taxes, depreciation and amortization. The Company presents this measure in order to enhance the understanding of the Company's historical financial performance and to enable comparability between periods. While the Company considers EBITDA to be an important measure of comparative operating performance, EBITDA should not be considered in isolation or as a substitute for net income or other statement of operations or cash flow data prepared in accordance with IFRS as a measure of profitability or liquidity. EBITDA does not take into account the Company's commitments, including capital expenditures, and restricted cash and, accordingly, is not necessarily indicative of amounts that may be available for discretionary uses. Not all companies calculate EBITDA in the same manner, and the measure as presented may not be comparable to similarly-titled measures presented by other companies. The Company's EBITDA may not be indicative of the historic operating results of the Company; nor is it meant to be predictive of potential future results. A reconciliation between results on an IFRS and non-IFRS basis is provided in the last table of this press release.
About Ellomay Capital Ltd.
Ellomay is an Israeli based company whose shares are registered with the NYSE American and with the Tel Aviv Stock Exchange under the trading symbol "ELLO". Since 2009, Ellomay Capital focuses its business in the renewable energy and power sectors in Europe and Israel.
To date, Ellomay has evaluated numerous opportunities and invested significant funds in the renewable, clean energy and natural resources industries in Israel, Italy and Spain, including:
-- Approximately 7.9MW of photovoltaic power plants in Spain and a
photovoltaic power plant of approximately 9 MW in Israel;
-- 9.375% indirect interest in Dorad Energy Ltd., which owns and operates
one of Israel's largest private power plants with production capacity of
approximately 860MW, representing about 6%-8% of Israel's total current
electricity consumption;
-- 51% of Talasol, which is involved in a project to construct a
photovoltaic plant with a peak capacity of 300MW in the municipality of
Talaván, Cáceres, Spain;
-- 100% of Groen Gas Goor B.V. and of Groen Gas Oude-Tonge B.V., project
companies developing anaerobic digestion plants with a green gas
production capacity of approximately 375 Nm3/h, in Goor, the Netherlands
and 475 Nm3/h, in Oude Tonge, the Netherlands, respectively;
-- 75% of Ellomay Pumped Storage (2014) Ltd. (including 6.67% that are held
by a trustee in trust for us and other parties), which is involved in a
project to construct a 156 MW pumped storage hydro power plant in the
Manara Cliff, Israel.
Ellomay Capital is controlled by Mr. Shlomo Nehama, Mr. Hemi Raphael and Mr. Ran Fridrich. Mr. Nehama is one of Israel's prominent businessmen and the former Chairman of Israel's leading bank, Bank Hapohalim, and Messrs. Raphael and Fridrich both have vast experience in financial and industrial businesses. These controlling shareholders, along with Ellomay's dedicated professional management, accumulated extensive experience in recognizing suitable business opportunities worldwide. Ellomay believes the expertise of Ellomay's controlling shareholders and management enables the Company to access the capital markets, as well as assemble global institutional investors and other potential partners. As a result, we believe Ellomay is capable of considering significant and complex transactions, beyond its immediate financial resources.
For more information about Ellomay, visit http://www.ellomay.com.
Information Relating to Forward-Looking Statements
This press release contains forward-looking statements that involve substantial risks and uncertainties, including statements that are based on the current expectations and assumptions of the Company's management. All statements, other than statements of historical facts, included in this press release regarding the Company's plans and objectives, expectations and assumptions of management are forward-looking statements. The use of certain words, including the words "estimate," "project," "intend," "expect," "believe" and similar expressions are intended to identify forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Company may not actually achieve the plans, intentions or expectations disclosed in the forward-looking statements and you should not place undue reliance on the Company's forward-looking statements. Various important factors could cause actual results or events to differ materially from those that may be expressed or implied by the Company's forward-looking statements, including the impact of the Covid-19 pandemic on the Company's operations and projects, including in connection with steps taken by authorities in countries in which the Company operates, changes in the market price of electricity and in demand, regulatory changes, changes in the supply and prices of resources required for the operation of the Company's facilities (such as waste and natural gas) and in the price of oil, and technical and other disruptions in the operations or construction of the power plants owned by the Company. These and other risks and uncertainties associated with the Company's business are described in greater detail in the filings the Company makes from time to time with Securities and Exchange Commission, including its Annual Report on Form 20-F. The forward-looking statements are made as of this date and the Company does not undertake any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
Ellomay Capital Ltd. and its Subsidiaries
Condensed Consolidated Statements of Financial Position
---
June 30, December 31
,
June 30,
2020 2019 2020
(Unaudited)
(Audited)
(Unaudited)
Convenience Translation
EUR in thousands into US$ in thousands
*
Assets
Current assets
Cash and cash equivalents 51,232 44,509 57,393
Marketable securities 2,226 2,242 2,494
Short term deposits 6,439 6,446 7,213
Restricted cash 22,162
Receivable from concession project 1,486 1,463 1,665
Financial assets 1,418
Trade and other receivables 4,790 4,882 5,366
66,173 83,122 74,131
Non-current assets
Investment in equity accounted investee 32,165 33,561 36,033
Advances on account of investments 882 883 988
Receivable from concession project 26,173 27,122 29,320
Fixed assets 194,521 114,389 217,913
Right-of-use asset 15,291 15,401 17,130
Intangible asset 4,857 5,042 5,441
Restricted cash and deposits 10,275 10,956 11,511
Deferred tax 5,777 2,285 6,472
Long term receivables 5,305 12,249 5,943
Derivatives 209 5,162 234
295,455 227,050 330,985
Total assets 361,628 310,172 405,116
Liabilities and Equity
Current liabilities
Current maturities of long term bank loans** 4,603 4,138 5,157
Current maturities of long term loans** 2,472 2,769
Debentures 4,592 26,773 5,144
Trade payables 1,730 1,765 1,940
Other payables 5,425 5,010 6,077
18,822 37,686 21,087
Non-current liabilities
Lease liability 15,487 15,402 17,349
Liabilities to banks ** 110,906
**40,805 124,243
Other long-term loans ** 46,711
**48,377 52,328
Debentures 40,087 44,811 44,908
Deferred tax 6,854 6,467 7,678
Other long-term liabilities 1,289 1,795 1,444
Derivatives 14,152 7,263 15,854
235,486 164,920 263,804
Total liabilities 254,308 202,606 284,891
Equity
Share capital 23,933 21,998 26,811
Share premium 75,433 64,160 84,504
Treasury shares (1,736) (1,736) (1,945)
Transaction reserve with non-controlling Interests 6,106 6,106 6,840
Reserves (1,454) 3,283 (1,629)
Retained earnings 9,346 12,818 10,470
Total equity attributed to shareholders of the Company 111,628 106,629 125,051
Non-Controlling Interest (4,308) 937 (4,826)
Total equity 107,320 107,566 120,225
Total liabilities and equity 361,628 310,172 405,116
* Convenience translation into US$ (exchange rate as at June 30, 2020: EUR 1 = US$ 1.120)
**Reclassified
Ellomay Capital Ltd. and its Subsidiaries
Condensed Consolidated Statements of Comprehensive Income (in thousands, except per share data)
---
For the three months For the six months
For the year ended
For the six months
ended June 30, ended June 30 December 31, ended June 30,
2020 2019 2020 2019 2019 2020
Unaudited Unaudited
Audited
Unaudited
Convenience
Translation
into US$*
EUR in thousands EUR in thousands
EUR in thousands
Revenues 2,271 5,570 4,214 10,303 18,988 4,721
Operating expenses (1,085) (1,791) (2,146) (3,455) (6,638) (2,404)
Depreciation and amortization expenses (721) (1,465) (1,447) (3,043) (6,416) (1,621)
Gross profit 465 2,314 621 3,805 5,934 696
Project development costs (584) (1,840) (2,338) (2,714) (4,213) (2,619)
General and administrative expenses (1,123) (982) (2,204) (1,879) (3,827) (2,469)
Share of profits of equity accounted investee (481) (1,133) 850 31 3,086 952
Other income (expenses), net (2,100)
Capital gain 18,770
Operating profit (loss) (1,723) (1,641) (3,071) (757) 17,650 (3,440)
Financing income 378 480 886 870 1,827 993
Financing income in connection with derivatives and warrants, net 145 29 1,099 460 897 1,231
Financing expenses (1,220) (1,972) (3,095) (4,457) (10,877) (3,467)
Financing expenses, net (697) (1,463) (1,110) (3,127) (8,153) (1,243)
Profit (loss) before taxes on income (2,420) (3,104) (4,181) (3,884) 9,497 (4,683)
Tax benefit (Taxes on income) 16 (325) (88) (514) 287 (99)
Profit (loss) for the period (2,404) (3,429) (4,269) (4,398) 9,784 (4,782)
Profit (loss) attributable to:
Owners of the Company (2,055) (2,040) (3,472) (2,751) 12,060 (3,890)
Non-controlling interests (349) (1,389) (797) (1,647) (2,276) (892)
Profit (loss) for the period (2,404) (3,429) (4,269) (4,398) 9,784 (4,782)
Other comprehensive income (loss) items that
after initial recognition in comprehensive
income (loss) were or will be transferred to profit or loss:
Foreign currency translation differences for foreign operations
113 (250) (86) 982 2,103 (97)
Effective portion of change in fair value of cash flow hedges
(23,401) (718) (9,289) (368) 1,076 (10,406)
Net change in fair value of cash flow hedges transferred to profit or loss 87 (94) 190 (1,104) (1,922) 213
Total other comprehensive income (loss) (23,201) (1,062) (9,185) (490) 1,257 (10,290)
Total other comprehensive income (loss) attributable to:
Owners of the Company (11,638) (667) (4,737) (13) 2,114 (5,307)
Non-controlling interests (11,563) (395) (4,448) (477) (857) (4,983)
Total other comprehensive income (loss) (23,201) (1,062) (9,185) (490) 1,257 (10,290)
Total comprehensive income (loss) for the period (25,605) (4,491) (13,454) (4,888) 11,041 (15,072)
Total comprehensive income (loss) for the period
attributable to:
Owners of the Company (13,693) (2,707) (8,209) (2,764) 14,174 (9,197)
Non-controlling interests (11,912) (1,784) (5,245) (2,124) (3,133) (5,875)
Total comprehensive income (loss) for the period (25,605) (4,491) (13,454) (4,888) 11,041 (15,072)
Basic net earnings (loss) per share (0.17) (0.19) (0.29) (0.26) 1.09 (0.32)
Diluted net earnings (loss) per share (0.17) (0.19) (0.29) (0.26) 1.09 (0.32)
* Convenience translation into US$ (exchange rate as at June 30, 2020: EUR 1 = US$ 1.120)
Ellomay Capital Ltd. and its Subsidiaries
Condensed Consolidated Unaudited Interim Statements of Changes in Equity
---
Attributable to shareholders of the Company Non- controlling Total
Interests Equity
Interests Transaction reserve with
Translation reserve from non-controlling Interests
foreign operations
Share capital Share premium Retained earnings Treasury shares Hedging Reserve Total
EUR
in thousands
For the six months ended June 30, 2020 (unaudited):
Balance as at January 1, 2020 21,998 64,160 12,818 (1,736) 4,356 (1,073) 6,106 106,629 937 107,566
Loss for the period - (3,472) (3,472) (797) (4,269)
Other comprehensive loss for the period - (98) (4,639) (4,737) (4,448) (9,185)
---
Total comprehensive loss for the period - (3,472) (98) (4,639) (8,209) (5,245) (13,454)
Transactions with owners of the Company, recognized directly in equity:
Issuance of ordinary shares 1,935 11,253 13,188 13,188
Share-based payments - 20 20 20
---
Balance as at June 30, 2020 23,933 75,433 9,346 (1,736) 4,258 (5,712) 6,106 111,628 (4,308) 107,320
Ellomay Capital Ltd. and its Subsidiaries
Condensed Consolidated Interim Statements of Changes in Equity (in thousands) (cont'd)
---
Non-
controlling Total
Attributable to shareholders of the Company Interests Equity
---
Retained Translation Transaction
earnings reserve from reserve with
Share Share (accumulated Treasury foreign H
edging non-controlling
capital Premium deficit) shares operations Reserve Interests Total
EUR in thousands
For the six months ended June 30, 2019 (unaudited):
Balance as at January 1, 2019 19,980 58,344 758 (1,736) 1,396 (227) 78,515 (1,558) 76,957
Loss for the period - (2,751) (2,751) (1,647) (4,398)
Other comprehensive loss for the period - 1,459 (1,472) (13) (477) (490)
---
Total comprehensive loss for the period - (2,751) 1,459 (1,472) (2,764) (2,124) (4,888)
Transactions with owners of the Company, recognized
directly in equity:
Sale of shares in subsidiaries to
non-controlling interests - 5,614 5,614 4,899 10,513
Options exercise 8 11 19 19
Share-based payments - 3 3 3
---
Balance as at June 30, 2019 19,988 58,358 (1,993) (1,736) 2,855 (1,699) 5,614 81,387 1,217 82,604
Ellomay Capital Ltd. and its Subsidiaries
Condensed Consolidated Interim Statements of Changes in Equity (in thousands) (cont'd)
---
Non-
controlling Total
Attributable to shareholders of the Company Interests Equity
---
Translation Transaction
Reserve from reserve with
Share Share Retained Treasury
foreign Hedging non-controlling
capital premium earnings shares operations Reserve
Interests Total
EUR in thousands
For the year ended December 31, 2019 (audited):
Balance as at January 1, 2019 19,980 58,344 758 (1,736) 1,396 (227) 78,515 (1,558) 76,957
Profit (loss) for the year - 12,060 12,060 (2,276) 9,784
Other comprehensive loss for the year - 2,960 (846) 2,114 (857) 1,257
---
Total comprehensive loss for the year - 12,060 2,960 (846) 14,174 (3,133) 11,041
Transactions with owners of the Company, recognized
directly in equity:
Sale of shares in subsidiaries to non-controlling interests
5,439 5,439 5,374 10,813
Purchase of shares in subsidiaries from non-controlling interests
667 667 254 921
Issuance of ordinary shares 2,010 5,797 7,807 7,807
Options exercise 8 11 19 19
Share-based payments - 8 8 8
---
Balance as at December 31, 2019 21,998 64,160 12,818 (1,736) 4,356 (1,073) 6,106 106,629 937 107,566
Ellomay Capital Ltd. and its Subsidiaries
Condensed Consolidated Unaudited Interim Statements of Changes in Equity
(cont'd)
---
Attributable to shareholders of the Company Non- controlling Total
Interests Equity
Interests
Transaction
Translation reserve with
reserve from
non-controlling
foreign Interests
Share capital Share premium Retained earnings Treasury shares operations Hedging Reserve Total
Convenience translation into US$*
For the six months ended June 30, 2020 (unaudited):
Balance as at January 1, 2020 24,643 71,876 14,360 (1,945) 4,880 (1,202) 6,840 119,452 1,049 120,501
Loss for the period - (3,890) (3,890) (892) (4,782)
Other comprehensive loss for the period - (110) (5,197) (5,307) (4,983) (10,290)
---
Total comprehensive loss for the period - (3,890) (110) (5,197) (9,197) (5,875) (15,072)
Transactions with owners of the Company, recognized
directly in equity:
Issuance of ordinary shares 2,168 12,606 14,774 14,774
Share-based payments - 22 22 22
---
Balance as at June 30, 2020 26,811 84,504 10,470 (1,945) 4,770 (6,399) 6,840 125,051 (4,826) 120,225
* Convenience translation into US$ (exchange rate as at June 30, 2020: EUR 1 = US$ 1.120)
Ellomay Capital Ltd. and its Subsidiaries
Condensed Consolidated Unaudited Interim Statements of Cash Flows
---
For the three months For the six months For the year ended For the six months
ended June 30, ended June 30, December 31, ended June 30
---
2020 2019 2020 2019 2019 2020
---
Unaudited Unaudited
Audited
Unaudited
---
Convenience Translation into US$*
EUR
in thousands
---
Cash flows from operating activities
Profit for the period (2,404) (3,429) (4,269) (4,398) 9,784 (4,782)
Adjustments for:
---
Financing expenses, net 697 1,463 1,110 3,127 8,153 1,243
Capital gain (18,770) -
Depreciation and amortization 721 1,465 1,447 3,043 6,416 1,621
Share-based payment transactions 6 2 20 3 8 22
Share of profits of equity accounted investees 481 1,133 (850) (31) (3,086) (952)
Payment of interest on loan from an equity accounted investee 370 582 370 370 652
Change in trade receivables and other receivables (461) (48) 127 (1,744) 403 142
Change in other assets (19) (234) (708) (1,950) (262)
Change in receivables from concessions project 503 475 704 646 1,329 789
Change in accrued severance pay, net 4 8 9 -
Change in trade payables (350) 556 (35) 1,065 461 (39)
Change in other payables 642 638 368 1,054 5,336 412
Income tax expense (tax benefit) (16) 325 88 514 (287) 99
Income taxes paid (100) -
Interest received 428 420 869 835 1,719 974
Interest paid (1,685) (2,450) (1,853) (2,655) (6,083) (2,076)
---
Net cash from (used in) operating activities (1,457) 924 (1,926) 1,129 3,712 (2,157)
===
Cash flows from investing activities
Acquisition of fixed assets (39,866) (37,230) (81,280) (44,519) (74,587) (91,054)
Acquisition of subsidiary, net of cash acquired (1,000) (1,000) -
Proceeds from sale of investments 34,586 -
Compensation as per agreement with Erez Electricity Ltd. 1,418 1,418 1,589
Repayment of loan by an equity accounted investee 1,923 2,154
Proceeds from settlement of derivatives, net 532 532 -
Proceeds (investment) in restricted cash, net (5) (5,306) 22,580 (5,219) (26,003) 25,295
Investment in short term deposit (6,302) -
Repayment of loan to others 3,500 3,500 3,912 -
Net cash used in investing activities (38,453) (39,036) (55,359) (46,706) (68,862) (62,016)
===
Cash flows from financing activities
Repayment of long-term loans (1,994) (3,652) (2,804) (4,158) (5,844) (3,141)
Repayment of Debentures (4,761) (4,532) (26,923) (4,532) (9,836) (30,161)
Cost associated with long term loans (12,218) -
Proceeds from options 19 19 -
Sale of shares in subsidiaries to non-controlling interests 14,062 14,062 13,936 -
Acquisition of shares in subsidiaries from non-controlling interests (2,961) -
Issue of warrants 320 358
Issuance of ordinary shares 13,188 7,807 14,774
Proceeds from long term loans 39,661 41,470 80,584 58,894 59,298 90,275
Proceeds from issuance of Debentures, net 22,317 -
Net cash from financing activities 32,906 47,348 64,365 64,285 72,518 72,105
===
Effect of exchange rate fluctuations on cash and cash equivalents 471 (54) (357) (55) 259 (400)
Increase (decrease) in cash and cash equivalents (6,533) 9,182 6,723 18,653 7,627 7,532
Cash and cash equivalents at the beginning of the period 57,765 46,353 44,509 36,882 36,882 49,861
---
Cash and cash equivalents at the end of the period 51,232 55,535 51,232 55,535 44,509 57,393
===
* Convenience translation into US$ (exchange rate as at June 30, 2020: EUR 1 = US$ 1.120)
Ellomay Capital Ltd. and its Subsidiaries
Reconciliation of Profit (Loss) to EBITDA (in thousands)
---
For the three months For the six months
For the year
For the six months
ended June 30, ended June 30, ended December 31, ended June 30,
2020 2019 2020 2019 2019 2020
---
Unaudited
Convenience
Translation
into US$*
EUR
in thousands
---
Net profit (loss) for the period (2,694) (3,429) (4,269) (4,398) 9,784 (4,782)
Financing expenses, net 782 1,463 1,110 3,127 8,153 1,243
Taxes on income (18) 325 88 514 (287) 99
Depreciation 808 1,465 1,447 3,043 6,416 1,621
--- ---
EBITDA (1,122) (176) (1,624) 2,286 24,066 (1,819)
* Convenience translation into US$ (exchange rate as at June 30, 2020: EUR 1 = US$ 1.120)
Information for the Company's Debenture Holders
Pursuant to the Deeds of Trust governing the Company's Series B and C Debentures (together, the "Debentures"), the Company is required to maintain certain financial covenants. For more information, see Item 5.B of the Company's Annual Report on Form 20-F submitted to the Securities and Exchange Commission on April 7, 2020.
Net Financial Debt
As of June 30, 2020, the Company did not have a Net Financial Debt, as the calculation of Net Financial Debt (as such term is defined in the Deeds of Trust of the Company's Debentures), resulted in a negative amount (i.e., an excess of assets over liabilities) of approximately EUR(15.4) million (consisting of approximately EUR174.2 million of short-term and long-term debt from banks and other interest bearing financial obligations and approximately EUR44.7 million in connection with the Series B Debentures issuance (in March 2017) and the Series C Debentures issuance (in July 2019), net of approximately EUR59.9 million of cash and cash equivalents, short-term deposits and marketable securities and net of approximately EUR174.4* million of project finance and related hedging transactions of the Company's subsidiaries).
_____________________________
* The project finance amount deducted from the calculation of Net Financial Debt includes project finance obtained from various sources, including financing entities and the minority shareholders in project companies held by the Company (provided in the form of shareholders' loans to the project companies). The minority shareholders' loans were not included in the project finance amount in previous calculations due to an oversight, despite such loans' terms and characteristics as "financing of projects" as set forth in the definition of Net Financial Debt in the Deeds of Trust governing the Debentures. The Company updated its calculations of Net Financial Debt and of the financial covenants based on Net Financial Debt for the recent four quarters, amending the oversight, and provided them to the Trustee of the Debentures. Based on the updated calculations, the calculation of Net Financial Debt of the Company as of June 30, 2019, September 30, 2019, December 31, 2019 and March 31, 2020 resulted in the following: EUR(6.3) million, EUR(4.3) million, EUR18.2 million and EUR(17.3) million, respectively. The updated financing of projects amount for such periods is EUR136.2 million, EUR136.5 million, EUR101 million and EUR139.5 million, respectively. The change in calculation did not affect the Company's fulfillment of the financial covenants as of such dates. The change in calculation also did not affect the Company's fulfillment of the financial covenants as of June 30, 2020, as the Net Financial Debt excluding the minority shareholders' loans as of June 30, 2020 was EUR33.7 million (based on a financing of projects amount of EUR125.3 million).
Information for the Company's Series B Debenture Holders
The following is an internal pro forma consolidated statement of financial position of the Company as at June 30, 2020. This information is required under the Series B Deed of Trust in connection with the adoption of IFRS 16 "Leases" by the Company and provides the consolidated statement of financial position of the Company as of the date set forth below after elimination of the effects of adoption of IFRS 16. Based on the pro forma statement of financial position, the ratio of the Company's equity (which the Company calculated in line with the definition of Balance Sheet Equity in the Series B Deed of Trust) to balance sheet as at June 30, 2020 was 31.1%.
Unaudited Internal Pro Forma Statement of Financial
Position
---
June 30,
2020
Unaudited
Pro Forma
EUR in thousands
Assets
Current assets
Cash and cash
equivalents 51,232
Marketable securities 2,226
Short term deposits 6,439
Receivable from
concession project 1,486
Trade and other
receivables 4,790
66,173
Non-current assets
Investment in equity
accounted investee 32,165
Advances on account
of investments 882
Receivable from
concession project 26,173
Fixed assets 194,521
Intangible asset 4,857
Restricted cash and
deposits 10,275
Deferred tax 5,954
Long term receivables 5,305
Long term receivables 209
Derivatives 280,341
Total assets 346,514
Liabilities and
Equity
Current liabilities
Current maturities of
long term loans 7,075
Debentures 4,592
Trade payables 1,730
Other payables 5,185
18,582
Non-current
liabilities
Long-term loans 157,617
Debentures 40,087
Deferred tax 6,963
Other long-term
liabilities 1,289
Derivatives 14,152
220,108
Total liabilities 238,690
Equity
Share capital 23,933
Share premium 75,433
Treasury shares (1,736)
Transaction reserve
with non-
controlling
Interests 6,106
Reserves (1,454)
Accumulated deficit 9,850
Total equity
attributed to
shareholders of the
Company 112,132
Non-Controlling
Interest (4,308)
Total equity 107,824
Total liabilities and
equity 346,514
Information for the Company's Series C Debenture Holders
The Deed of Trust governing the Company's Series C Debentures includes an undertaking by the Company to maintain certain financial covenants, whereby a breach of such financial covenants for two consecutive quarters is a cause for immediate repayment. As of June 30, 2020, the Company was in compliance with the financial covenants set forth in the Series C Deed of Trust as follows: (i) the Company's shareholders' equity was EUR107.5 million and (ii) the Company did not have a Net Financial Debt. In the event the Company does not have a Net Financial Debt the calculation of the two covenants that are based on Net Financial Debt (i.e., the ratio of the Company's Net Financial Debt to the Company's CAP, Net (defined as the Company's consolidated shareholders' equity plus the Net Financial Debt) and the ratio of the Company's Net Financial Debt to the Company's Adjusted EBITDA((1))), becomes irrelevant and the Company is therefore in compliance with such covenants.
(______________________________________________)
((1) )The term "Adjusted EBITDA" is defined in the Series C Deed of Trust as earnings before financial expenses, net, taxes, depreciation and amortization, where the revenues from the Company's operations, such as the Talmei Yosef project, are calculated based on the fixed asset model and not based on the financial asset model (IFRIC 12), and before share-based payments. The Series C Deed of Trust provides that for purposes of the financial covenant, the Adjusted EBITDA will be calculated based on the four preceding quarters, in the aggregate. The Adjusted EBITDA is presented in this press release as part of the Company's undertakings towards the holders of its Series C Debentures. For a general discussion of the use of non-IFRS measures, such as EBITDA and Adjusted EBITDA see above under "Use of NON-IFRS Financial Measures."
The following is a reconciliation between the Company's net profit and the Adjusted EBITDA for the four-quarter period ended June 30, 2020*:
For the four
quarter period
ended June 30,
2020
Unaudited
EUR
in
thousands
Net profit for the period 9,913
Financing expenses, net 6,136
Taxes on income (713)
Depreciation 4,820
Adjustment to revenues of the Talmei Yosef project due to calculation based on the 2,889
fixed asset model
Share-based payments 25
---
Adjusted EBITDA as defined the Series C Deed of Trust 23,070
___________________________________
* As noted above, the Company is in compliance with the covenant with respect to the ratio of Net Financial Debt to Adjusted EBITDA as the Company does not have a Net Financial Debt as of the end of the period. Therefore, the Adjusted EBITDA calculation above is provided for convenience and consistency purposes only.
Contact:
Kalia Weintraub
CFO
Tel: +972 (3) 797-1111
Email: kaliaw@ellomay.com
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SOURCE Ellomay Capital Ltd
