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RENEWABLE ENERGIES: A SAFE COMMITMENT

• The Net Zero path is unstoppable at a global level, and the processes of electrification and decarbonization are a reality worldwide, which enhances the relevance of renewable energies.
• The climate emergency requires a coordinated, adequate and urgent response.
• To face this challenge, the energy sector plays a key role in following the path to achieve the global targets.
• Likewise, the geopolitical tensions that we have recently begun to experience in Europe have shown how renewable energy is key to reducing the energy dependencies of countries and guaranteeing supply.
• Despite the disruptions that are occurring in the short term, in the medium and long term, it is a sector that will experience great growth.
• The environment is more challenging than ever, and companies must adapt to new conditions, with agile and flexible business models, capable of generating value and responding to the needs of their stakeholders, in a changing environment full of challenges.

 

A CLEAR GOAL

• Soltec has a clear goal: to help build a cleaner, more sustainable and fairer world through energy.
• This goal leads our activity and gives reason to our existence.
• In the current context, our corporate strategy is based on three fundamental pillars:

-Vertical integration
-Sustainability
-Innovation

 

GREATER VERTICAL INTEGRATION TO GENERATE VALUE

In a complex context, Soltec is committed to vertical integration to generate value for its shareholders, through three business lines:

1. Industrial: solar tracker supply and other construction services
2. Photovoltaic project development
3. Asset management

In the next five years, Soltec Power Holdings plans to achieve revenues of more than €780-840 million through its three business dicisions (Industrial, Project Development and Asset Management).

The operating result, thanks to the synergies between the different divisions, and the recurrence and strength provided by vertical integration, we estimate it to be in the range of €100-120 million.

 

AN INDUSTRIAL IPP

The photovoltaic project development strategy focuses on Tier 1 countries, with high irradiation and high growth potential (those in which Soltec has an integrated presence, or potentially can be integrated), such as: Spain, Italy, Brazil, Denmark, Colombia, United States, Romania or Mexico.

Every 18 months, it will begin development in new countries that offer potential and guarantee the use of our integrated capabilities, with the continuous optimization of asset rotation aimed at maximizing the value of projects under development and generating synergies.

Gradually, Soltec Power Holdings transforms into an IPP that offers industrial services, and a strengthened value proposition that makes us stronger and provides us with strength and flexibility to face a complex environment.

 

A GROWING INDUSTRIAL DIVISION AND WITH IMPROVING OPERATING MARGINS

The industrial division maintains a leadership position worldwide, rising to third position for accumulated trackers supplied.

At the end of the first quarter of 2022, the industrial division had an accumulated track record of 12.7 GW (0.9 GW in the first quarter of the year).

The operational indicators remained robust, with a backlog (signed projects pending execution) of €399 million, and a €2,928 million pipeline (projects with a certain probability of execution).

The solar tracker value proposition remains robust against fixed installations, with solar tracker supply expected to reach 26-30 GW by the end of the strategic plan term.

These levels of supply will imply revenues to be between €750 million and €800 million.

The investments necessary to achieve these objectives are limited to 1% of the revenues generated, corresponding mainly to R&D and reaching €22-30 million for the full plan period.

 

HIGH QUALITY PHOTOVOLTAIC DEVELOPMENTS

Soltec Power Holdings has developed photovoltaic projects since its inception. To date, it has more than 11.6 GW of projects in development at different stages, 225 MW under construction, and 5 MW that have recently been connected to the grid in Spain (35% owned).

The main competitive advantages of our photovoltaic developments are:

• Unique development team of 85 people dedicated exclusively to developing projects globally
• Origination capacity
• Quality of our assets
• Optimized development costs
• Presence in countries with high solar radiation and growth potential
• Countries in which Soltec Industrial is present and has knowledge and equipment
• Geographic diversification

We expect the pipeline of the project development division to reach 25-30 GW in 2025, very balanced by region, maintaining 55% of the pipeline in Europe and 45% in America.

The assets that will be rotated to third parties from the development division will reach 3.5GW-4.4GW in the 2022-2025 period.

 

SOLTEC ASSET MANAGEMENT

In line with our goal of taking a further step in the vertical integration of the company, Soltec Asset Management was born, which will be in charge of managing the assets that the company decides to keep in its portfolio, instead of rotating them to third parties.

This step in our business strategy will allow us to:

1. Obtain an additional revenues stream from the sale of energy that provides recurrence to our income statement, soundness and stability.

2. Mitigate existing risks in the value chain thanks to geographic diversification and business diversification.

3. Differentiation from competitors

4. Maximize the value of projects, generating value for our stakeholders

Soltec Asset Management will reach between 750 MW and 1,020 GW in operation, generating energy in the year 2025, generating a range of revenues of €30-40 million, and €770-950 million investments in the period 2022-2025.