Abengoa announces 2016 results and is nearing the completion of its financial restructuring
Abengoa, the international company that applies innovative technology solutions for sustainability in the energy and environment sectors, announces the financial results for the year 2016. During the fourth quarter of 2016 the Company has completed several fundamental milestones in the execution of its restructuring process. On November 22, 2016 the Company held the Extraordinary General Shareholders’ Meeting, in which the necessary measures for the implementation of the Restructuring Agreement signed in September 2016 were approved, including the share capital increase and the designation of the new Board of Directors.
Abengoa recorded revenues of 1,510 M € and EBITDA of (241) M € in 2016. These figures exclude the impact from the Bioenergy activity and the concessional Brazilian transmission lines, which have been classified as discontinued operations, and with combined impact of revenues of 1,137 M € in 2016 vs. 2,109 M € in 2015. The net result represents a loss of 7,629 M €, mostly due to the negative impact from (i) the impairment of certain assets (Bioenergy plants, transmission lines in Brazil, generation assets in Mexico and Chile, tax credits) for a total amount of 6,036 M €, (ii) the effect of the general decrease in activity which has caused, amongst others, provision of constructions costs for a total of 245 M € and, (iii) higher financial expenses amounting to 521 M € mainly derived from the materialization and provision of certain guarantees and default interests.
These losses, to a great extent the result of the implementation of measures included in the Restructuring Agreement, are expected to be compensated by the positive impact derived from the debt write-offs and capital increases, allowing Abengoa S.A to restore its financial stability and to obtain the liquidity needed to begin the operations contemplated in the viability plan and continue with the Company’s activity in a competitive and sustainable manner going forward. Gonzalo Urquijo Fernández de Araoz, Abengoa’s Executive Chairman, said “These results must be interpreted in the context of Abengoa’s financial restructuring. The 2016 financial statements reflect the adjustments derived from the restructuring and the Company’s performance impacted by the long negotiation with financial creditors. As soon as the financial restructuring is completed, for which our creditors have today once more confirmed their support, the subsequent debt reduction will restore financial stability”.
Results by segment
Revenues in the engineering and construction activity reached 1,367 M€ and EBITDA amounted to (327) M €, versus 3,382 M € and 169 M € respectively in 2015. This decrease is mainly due to the aforementioned effects of decrease in activity that has affected mostly certain projects in Mexico, the solar power plants in Chile and South Africa and the transmission lines in Brazil. Said delays or stoppages in projects have led to certain construction cost provisions in the amount of 245 M € being recorded. Abengoa’s backlog in engineering and construction as of December 31, 2016 amounted to approximately 2,700 M €, after adjustments derived from the sale of assets, the financial restructuring of Brazilian transmission lines, hibernation of certain projects in line with the viability plan, and for other canceled projects. Nevertheless, in 2016 the Company has been awarded with new projects for a total approximate value of 1,290 M € in Saudi Arabia, Oman, Peru, and Uruguay, among others.
Revenues in the concession-type infrastructure activity reached 143 M € and EBITDA amounted to 85 M € in 2016, compared to 265 M € and 174 M €, respectively, during 2015. These decreases are mainly due to the sale of assets to Atlantica Yield during 2015 under the ROFO agreement (Right of First Offer) and other assets included in the divestment plan.In order to keep all stakeholders up to date with regards to the financial restructuring process, Abengoa has dedicated a new section in the corporate website to this. We encourage all our stakeholders to visit: http://www.abengoa.com/web/en/accionistas_y_gobierno_corporativo/proceso-restructuracion/