NHOA First Half 2023 Results and Q2 Trading and Operational Update

Paris, 25 July 2023 – NHOA (NHOA.PA, formerly Engie EPS) announces its First Half 2023 Results and the Q2 2023 Trading and Operational Update.

At Group level:

• H1 Revenues and Other Income at €116 million, up +48% year-on-year
• Backlog and Purchase Orders at June 30 2023 amounts to c. €270 million, up +89% year-on-year
• 2023 Revenue Guidance Update: Full Year Revenue Guidance upgraded to €250-280 million (previously €220-280 million)
• 2023 EBITDA Guidance: Management expects 2023 EBITDA at Group level (excluding Atlante) to range between -€6m and €5m, with therefore the ambition to reach EBITDA breakeven at year end

First Half 2023 has been a turning point for all business lines:

• NHOA Energy, marks once again unparalleled H1 results with:
  • €100.8 million Revenues and other Income, up +38% year-on-year
  • Positive EBITDA of €1.1 million, with a €5-10 million EBITDA guidance for this business line by year end
  • Backlog at €211 million, up +48% compared to H1 2022
  • Last-12-month Order Intake over €250 million
  • 1.4GWh of projects under construction and 228MWh of projects online totaling c. 1.6GWh
  • Pipeline stable at over €1 billion

• Free2move eSolutions, the JV with Stellantis, reached:
  • Revenues and other income of €13.1 million, as to say +159% year-on-year and 4x revenues booked in Q1 2023
  • Outstanding Purchase Orders at 30 June 2023 of c. €58 million

• Atlante, is ahead on the expected guidance for 2023 with:
  • Over 3,200 Points of Charge (“PoC”) already online and under construction as at 30 June 2023, achieving six months earlier the results envisaged for year-end
  • Over 1,200 PoC already online and serving customers on a daily basis
  • Over 3,700 additional sites in the pipeline
  • Utilization Rate, c. 2.4% in the second quarter for Italy, France and Spain
  • Occupancy Rate, c. 20.7% in the second quarter for Portugal

“NHOA has delivered its strongest first half ever, in all business lines, bringing Group revenues up by +48% to €116 million and increasing visibility towards the new full-year targets of €250 to €280 million revenues and EBITDA breakeven at Group level, excluding Atlante.

NHOA Energy performed remarkably well with 5 energy storage projects online in the first half of the year, €250 million rolling order intake and over 1.6GWh in 4 continents, while expanding in new key geographies, like the United Kingdom, with the newly awarded 130MWh projects for Eku Energy.

Atlante keeps the roll-out of its fast and ultra-fast charging network in Southern Europe at record speed, achieving six months earlier than expected more than 3,200 points of charge online and under construction in over 1,000 sites, and most importantly running at 2.4% utilization rate and 20.7% occupancy rate.

Free2move eSolutions starts to show its ability to scale-up the e-mobility market, with revenues in the second quarter achieving 4 times those of the first quarter, looking forward to a remarkable 2023 with €58 million outstanding purchase orders”, commented Carlalberto Guglielminotti, CEO of NHOA Group.

We achieved this remarkable performance thanks to the tremendous commitment of our teams, over 500 people of 38 nationalities inspired by the same mission: fighting climate change by fostering the energy transition to clean energy and sustainable mobility, with the goal of being a global technology leader, shaping a sustainable future for the next generations.

This is the mission we live by, and these are the people who will continue to grow along with NHOA in the context of the new People Strategy and thanks to the NHOA Élite Program presented in June 2023, which will provide training and support with world-class experts for physical wellbeing, mental balance and performance optimization”.

First Half 2023 Key Figures

Revenues and Other Income as of 30 June 2023 amount to €116 million, up 48% compared to H1 2022.

Increase in Revenues and Other Income is mainly driven by the €100.8 million realized by NHOA Energy and are mainly related to:

• the second storage system in HePing, Taiwan, 311MWh, in early stage of commissioning
• the 200MWh Kwinana storage project with Synergy in Australia, in the final stage of commissioning
• the 2 Peruvian projects, for a cumulated capacity of 67MWh, of which the first one is already operational while the second is still under construction
• the third project in Suao, Taiwan, for a total capacity of 123.6MWh

Free2move eSolutions contributes for €13.1 million to the Group’s consolidated Revenues and other income, of which 9.7 million come from the delivery of the purchase orders signed in 2022 (14% of the total).

Atlante closed H1 2023 with Revenues and other income of €2.0 million.

The 14.8% Gross margin including non-recurring item is mainly due to the revenue mix, where NHOA Energy’s turnkey contracting business model weights heavier than the e-Mobility and EV Fastcharging Network business lines, however, growing volumes of Free2move eSolutions and Atlante are positively impacting and progressively improving total Gross margin.

Backlog of NHOA Energy totals €211 million, represented by 1,413MWh in Australia, Taiwan, China, Latin America, US and Europe, up 48% compared to H1 2022. The 16% decrease compared to the Backlog communicated in the Q1 2023 Trading and Operational Update is due to the Revenues recognition as of 30 June of projects that were still in Backlog at that time and the impact of commodity-indexed price formulas.

The Pipeline of NHOA Energy stands at €1,035 million, stable year-on-year, while decreasing by 16% compared to the pipeline announced in the Q1 2023 Trading and Operational Update. Given the over €250 million Order intake in the last 12 months (+13% vs Q1 2023), this represents an approx. 25% conversion rate.

Personnel costs reached €23.4 million, more than doubling compared to €11.6 million in H1 2022, mainly due to the increase in headcount. As of 30 June 2023, NHOA Group has 522 employees[1] (from 38 nationalities) compared to 359 in H1 2022. The strengthening of the workforce is mainly due to the consolidation of Atlante in four countries and to NHOA Energy’s global growth and is in line with NHOA Group’s roadmap and Masterplan10x.

Capital investments increased to €42.3 million, largely comprised of investments in the roll-out of the Atlante network.

R&D investments amounted to €5.8 million and represent 5% of the consolidated Revenues.

Other Operating Expenses increased by 163%, amounting to €10.4 million, compared to €3.9 million in H1 2022, expressing an organic growth mainly driven by the consolidation of NHOA Energy’s subsidiaries in America, Australia and Taiwan, the addition of Free2move eSolutions North America for Free2move eSolutions and the growth of Atlante which has now consolidated its platform in Italy, France, Spain and Portugal.

EBITDA including non-recurring income represents a €16.6 million loss in H1 2023, compared to a €5.8 million loss in H1 2022, due to the increase in operating expenses and in personnel costs, mainly due to a natural effect of the investments that NHOA made on Atlante, which remains a capital-intensive business whose benefits are expected to contribute to the bottom line in the following years. Excluding Atlante, the EBITDA would represent a €7.2 million loss. Free2move eSolutions has started the delivery of the devices from purchase orders in Q2 2023 and improvement of its EBITDA 2023 is expected for H2. NHOA Energy confirmed its positive EBITDA that amounts to €1.1 million, despite a doubling of personnel cost in order to establish the global origination and execution platform that will bear results over the next few years.

Non recurring expenses and Incentive Plan account for €1.0 million and €1.9 million, respectively; the first one is mainly due to European Commission grant under the Connecting Europe Facility (CEF) program application support, the opening of the new legal entities in new countries and M&A activities, while the second is mainly related to the accrual by per IFRS 2 related to Long Term Incentive Plan approved by the Board of Directors in 2022, without any impact from a cash flow perspective.

EBIT and Net Result as of 30 June 2023 stand, respectively, at -€24.6 million and -€26.7 million, compared to -€9.3 million and -€11.6 million of the previous year as of 30 June 2022.

Net Financial Position stands at -€75.8 million as at 30 June 2023 compared to €4.2 million as at 31 December 2022, mainly reflecting the investment of the Group in Atlante and the capital deployed by NHOA Energy to support projects in execution. Taking into account the €47.3 million of cash deposits and cash collateral posted to guarantee securities on projects in execution, the Net Financial Position would amount to -€28.5 million.

Guidance Update[2]

• 2023 Revenue Guidance Update: given the increased visibility of Revenues recognition of NHOA Energy, the conversion of the Purchase Orders of Free2move eSolutions in Revenues successfully started in Q2 2023 and the Utilization/Occupancy rate trend in Atlante, Full Year Revenue Guidance is upgraded to €250-280 million (previously €220-280 million). The revised guidance is based on the following key assumptions:
  • no delays in NHOA Energy supply chain delivery schedule;
  • no major impact from contract commodity indexation mechanisms and currency variation; and
  • delivery (and the corresponding revenues recognition) of at least 75% of the Purchase Orders of Free2move eSolutions by year-end, in line with the trend started in Q2 2023
• 2023 EBITDA Guidance: as a result of the revised 2023 revenue guidance and the increased visibility of Revenue recognition of NHOA Energy and the conversion of the Purchase Orders of Free2move eSolutions in revenues, Management expects 2023 EBITDA at Group level (excluding Atlante) to range between -€6m and €5m, with therefore the ambition to reach EBITDA breakeven at year end. Guidance of the 2023 EBITDA of NHOA Energy continues to be at €5 to 10 million.

First Half 2023 results by business line

NHOA Energy

NHOA Energy, NHOA Group’s business line dedicated to energy storage, confirmed EBITDA-positive also in H1 2023, with €1.1 million of EBITDA realized over €100.8 million of revenues and other income, despite a doubling of personnel cost in order to establish the global origination and execution platform that will bear results over the next few years.

In the first semester of 2023 Revenues and Other Income grew by +38% year-on-year, in line with expectations. During H1, NHOA Energy saw the commissioning of several advanced projects in the portfolio, while the first project in Australia (200MWh) is also approaching the finish line and the Heping Big Battery project (311MWh) in Taiwan that has provided the largest contribution in terms of Revenues.

Backlog for NHOA Energy totalizes €211 million, 16% lower compared to Q1 2023 mainly due to the significant portion of Backlog converted into revenues during the H1 2023 and the impact of commodity-indexed price formulas. Backlog is represented by 1.4GWh in USA, APAC, Europe and South America. In the first semester of 2023 NHOA Energy was awarded two contracts in the UK for a total capacity of 130MWh by EKU Energy. Five projects entered operation in H1 2023, including the two fast reserve projects in Italy for an aggregated capacity of 41.1MWh, one of the 2 Peruvian storage systems (31MWh) and one of the storage systems in Massachusetts for Kearsage Energy.

Pipeline for NHOA Energy is stable at over €1 billion, and continues to improve in quality: NHOA is shortlisted in 6 projects with very promising short-term conversion prospects.

Gross Margin stands at 11.7% and its improving, due to the profitability profile of the project portfolio.

NHOA Energy confirms EBITDA positive, at €1.1 million in H1 2023, while continuing to invest aggressively in geographical expansion and talent acquisition. After the opening of the subsidiaries NHOA Australia and NHOA Americas in 2022, establishing 2 crucial centers for the commercial expansion in Australia and the whole American continent, NHOA Energy continued on this trend by opening in H1 2023 two other geographical subsidiaries NHOA Taiwan and NHOA UK, to better follow the Asian and Great Britain markets, as testified by the recent subscription of a contract for the supply of two battery storage systems for an aggregate capacity of 130MWh in the UK.

NHOA Energy’s Graduate Program, the talent program launched on April 1^st 2022, in which 10 new young talents had been hired and immediately trained by experts of the field and top management, has been replicated in 2023 and is assuming a primary role in the expansion of NHOA Energy’s origination and execution platform. As planned, part of the talents of the first class have been already moved, together with senior team members, in the geographical subsidiaries, taking NHOA Energy’s philosophy and competences all over the world and integrating them with local expertise.

EBIT excluding non-recurring and Net Result are both still negative by €2.0 million, after posting depreciation and amortization of €2.2 million.   

Free2move eSolutions

Free2move eSolutions, NHOA Group’s business line dedicated to e-mobility products and services in joint venture with Stellantis, after a transitional 2022, with a change in leadership and a general streamlining and refocusing of its operations, had a positive H1 2023.

Free2move eSolutions Revenues and Other Income, indeed, raised more than 2.5 times on a year-on-year basis, reaching €13.1 million, mainly due to the opening of the American subsidiary Free2move eSolutions North America.

Most importantly €13.1 million represents four times the revenues booked in the first quarter of 2022, while recording a 34.7% Gross Margin, increasing visibility towards unparalleled results in 2023.

EBIT excluding non-recurring stands at -€7.3 million and Net Result stands respectively at -€7.7 million.

Atlante

Atlante, NHOA Group’s business line dedicated to EV fast and ultra-fast charging network, is continuing its successful path to 2025 targets, reaching six months in advance the target foreseen for FY 2023 with 3,215 points of charge online and under construction as of 30 June 2023 and a pipeline of more than 3,700 additional sites.  Highlights of H1 2023 for Atlante include the inauguration of its largest station to date, the e-mobility hub at To Dream, the new innovative urban district in Turin, with more than 130 fast and ultra-fast points of charge; the signing of important partnerships like the one with Groupe Duval in France for more than 180 fast and ultra-fast charging points across the country and the one with Avanza Food in Spain and Portugal, and the award of 87 fastcharging points to be deployed on French highways for Vinci Autoroutes, as recently announced.

During H1 2023 Atlante’s team continued the development of its proprietary energy management system, leveraging on the 15 years of know-how developed by NHOA, and unveiled the exclusive design of Atlante’s charging station design, in partnership with Bertone Design (New Crazy Colors), one of the world’s most renowned design, architectural planning and all-around creativity companies.

Revenues and Other Income for H1 2023 amount to €2.0 million.

EBITDA of -€9.4 million reflects the investments in the roll-out of the EV fast and ultra-fast charging network, including the technology platform and the organization already structured to own and properly operate one of the largest networks of charging stations across Southern Europe, consistently with Atlante’s 2025 ambitious targets and with the common purpose of the Group to push forward the energy transition. Atlante now counts 134 people in 4 countries.

EBIT excluding non-recurring stands at -€10.5 million and Net Result stands respectively at -€11.3 million.

[1] Including secondments to NHOA.

[2] See also Chapter 11 of NHOA’s 2022 Universal Registration Document for more details on the assumptions underlying this guidance, and Chapter 3 on the risk factors that could negatively impact its achievement.

Q2 2023 Trading and Operational Update

Notes to the Q2 2023 Trading and Operational Update

(1) Cash and Credit Lines available for withdrawal represents the cash in the bank accounts of NHOA Group, coupled with the cash credit facilities approved and available for drawdown as of the relevant reporting date. From Q1 2023 we excluded from this indicator cash deposits and cash collateral posted to guarantee securities  projects in execution.

(2) Backlog means the estimated revenues and other income attributable to (i) purchase orders received, contracts signed and projects awarded (representing 100% of Backlog as of the date hereof), and (ii) Project Development contracts associated with a Power Purchase Agreement, where the agreed value is a price per kWh of electricity and an amount of MW to be installed (nil at the date hereof). When any contract or project has started its execution, the amount recognized as Backlog is computed as (A) the transaction price of the relevant purchase order, contract or project under (i) and (ii) above less (B) the amount of revenues recognized, as of the relevant reporting date, in accordance with IFRS 15 (representing the amount of transaction price allocated to the performance obligations carried out at the reporting date).

(3) 12-month order intake represents the cumulated value of new purchase orders received, contracts signed and projects awarded in the 12 months preceding the relevant reporting date.

(4) Projects Under Construction is an indicator representing the capacity equivalent of Backlog, in terms of signed turnkey supply or EPC contracts and therefore excluding Project Development contracts associated with a Power Purchase Agreement, (please see Note (2) above).

(5) Pipeline means the estimate, as of the release date, of the amount of potential projects, tenders and requests for proposal for which NHOA Energy has decided to participate or respond. On a quarterly basis NHOA Group will disclose in its Trading & Operational Updates the number of projects in which NHOA Energy is officially shortlisted.

(6) Sales include the data coming from the recent acquisition of the e-mobility business unit of Ressolar S.r.l. (“Ressolar”) and the recent acquisition of the majority stake in Kilometer Low Cost S.A. (“KLC”).

(7) Utilization Rate indicator first published in Q2 2023, applies to Italy, France and Spain only and is calculated first at station level as the ratio of (a) kWh sold divided (b) the maximum available power (i.e. the available grid connection) multiplied by 18 hours (being the assumed daily maximum charging hours) per number of days in the relevant period. The ratios are then aggregated, weighted by the stations’ available power. Note that stations’ utilization data is only included in the calculation after a phase-in period of six months and for DC fastcharging only.

(8) Occupancy Rate indicator applies to Portugal only where, due to the different local market regulations, as Charge Point Operator (CPO) Atlante is remunerated for the usage of its infrastructure “by minute”. Occupancy rate is therefore calculated on a 24-hour basis, first at station level as the ratio of (a) minutes of charging sessions sold divided (b) total number of minutes in the relevant period. The ratios are then aggregated, weighted by the stations’ available power. Note that stations’ occupancy data is only included in the calculation after a phase-in period of six months.

(9) Sites Online and Under Construction, includes, as of the relevant reporting date, the number of sites already operational, already installed but waiting for grid connection, secured and under construction. Please note that this performance indicator includes sites with AC points of charge, mainly coming from the KLC and Ressolar acquired networks.

(10) PoC Online and Under Construction, includes the points of charge already operational, as of the relevant reporting date, already installed but waiting for grid connection, secured and under construction. Please note that this performance indicator includes AC points of charge, mainly coming from the KLC and Ressolar acquired networks.

(11) Of the PoC Online and Under Construction performance indicator the geographical and construction phase split are provided, including the AC points of charge, mainly coming from the KLC and Ressolar acquired networks.

(12) Sites Under Assessment includes the total number of sites, as of the relevant reporting date, which are actively pursued after prospecting activity and following a first internal screening for high level feasibility. At this point, the full contractual documentation remains to be finalized and signed, all the required permits have not yet been awarded and construction has not started.

(13) Sites Under Development, includes sites for which a more detailed feasibility activity commences, including detailed discussions with site owners and exchange of documentation. For the sites included in the “under development” performance indicator there would be a reasonable degree of confidence that they can be converted into stations within the next six months (subject to interconnection and timely delivery of hardware).

Additional notes

Online Capacity Starting in H1 2023 online capacity is stated in MWh of energy storage capacity as opposed to MW of power capacity, as historically reported. Storage systems are increasingly sized towards the time shift of bulk volumes of renewable energy from periods of overgeneration to period of higher residual reliance of fossil-based generation. Their storage capacity volume is therefore a more significant indicator rather than their power rating, indicative of their speed of charge or discharge of such volumes.

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1 CONSOLIDATED FINANCIAL STATEMENTS

• • 1.1 Consolidated Income Statement

*The H1 2022 figures have been restated for the item described in note 2.6 of the  Consolidated Financial Statements

•  1.2 Consolidated Statement of Other Comprehensive Income

*The H1 2022 figures have been restated for the item described in note 2.6 of the  Consolidated Financial Statements

•  1.3 Consolidated Balance Sheet

*The H1 2022 figures have been restated for the item described in note 2.6 of the  Consolidated Financial Statements

•  1.4 Consolidated Statement of Changes in Equity

*The 2021 figures have been restated for the item described in note 2.6 of the 2022 Consolidated Financial Statements

**The H1 2022 figures have been restated for the item described in note 2.6 of the  Consolidated Financial Statements

•  1.5 Consolidated Statement of Cash Flows

*The H1 2022 figures have been restated for the item described in note 2.6 of the  Consolidated Financial Statements