Abengoa Yield: Q1 results
Abengoa Yield (ABY), the sustainable total return company that owns a diversified portfolio of contracted assets in the energy and environment sectors, reported revenues of $118.3 million for the three months ended March 31, 2015, representing an 85 % increase compared to the first quarter of 2014 and Further Adjusted EBITDA including unconsolidated affiliates of $105.2 million, representing a 106 % increase compared to the same period of 2014. Cash Available for Distribution reached $38.5 million, more than one quarter of the 2015 CAFD guidance in spite of seasonality.
Increase in quarterly dividend
Abengoa Yield announced today that the Board of Directors declared a quarterly dividend corresponding to the first quarter of 2015, amounting to $0.34 per share, representing more than a 30 % increase with respect to our last quarterly dividend and a very comfortable pay-out ratio of 71 %. This dividend is expected to be paid on or about June 15, 2015 to shareholders of record on May 29, 2015.
$669 million acquisition of assets from Abengoa announced
Abengoa Yield has reached an agreement with Abengoa to acquire four solar assets consisting of:
Helios (100 MW complex), Solnovas (150 MW complex) and the remaining 70 % stake in Helioenergy (100 MW complex of which Abengoa Yield already owns a 30 % stake), all in Spain.
A 51 % stake in Kaxu, a 100 MW plant in South Africa.
Abengoa Yield expects these new assets to generate incremental run rate cash available for distribution of approximately $63 million per year before debt service associated with acquisition financing. This represents a 9.4 % acquisition yield. The acquisition includes the exercise of the 12 % call option signed with Abengoa in December 2014. Pro forma of this transaction, 93 % of CAFD is expected to be denominated or indexed to US$.
The acquisition will be financed with $670 million proceeds of a capital increase priced Friday, May 8, at $33.14 per share, which was based on a 3 % discount versus May 7 closing price, pursuant to a private placement that will result in the issuance of 20,217,260 new shares. The private placement is expected to close on May 14, 2015. Abengoa has subscribed for 51 % of the newly-issued shares and will maintain its current stake in Abengoa Yield.
Average remaining useful life of the portfolio to be acquired is approximately 22 years. Helios, Solnovas and Helioenergy have been operating for two to five years, showing a solid operational track record and have significant management and operational synergies with existing solar assets in Abengoa Yield's portfolio. Kaxu solar plant is located in the Kalahari desert in South Africa site with a solar radiation higher than the Southwest of the United States and has a power purchase agreement in place for 100 % of the output with Eskom, with a guarantee from the Department of Energy of the Government of South Africa, rated BBB-, Baa, BBB.
Increase in Dividend per Share Guidance
Santiago Seage, CEO of Abengoa Yield, commented "Our largest acquisition of assets from Abengoa will double our existing installed capacity in renewable energy, while maintaining very good quality in our portfolio, with a best-in-class average remaining useful life of 23 years and all our CAFD generated from contracted or regulated assets with high quality off-takers. As a result, we are pleased to raise our guidance for the year 2016, in which we expect to distribute a dividend in the range of $2.10 to $2.15 per share, an increase of up to 9 % with respect to our previous guidance. With this, we would provide a dividend per share growth of 30 % to 34% in 2016 vs 2015."
Outlook beyond 2016
In addition, considering Abengoa's current portfolio of assets in operation and construction, which are expected to generate cash available for distribution in the range of $310 to $360 million, and future potential opportunities, we expect to deliver a yearly dividend per share growth in the range of 12 % to 15 %. This means that mid-term dividend growth per share from our 2015 IPO target of $1.36 would be higher than 20 % per year.
About Abengoa Yield
Abengoa Yield is a total return company that owns a diversified portfolio of contracted renewable energy, power generation, electric transmission and water assets in North America, South America and EMEA. We focus on providing a predictable and growing quarterly dividend or yield to our shareholders (www.abengoayield.com).