HALF-YEAR RESULTS 2016 AND OUTLOOK · Half-yearresults 2016 15 H1 2016 H1 2015 Change Current...

HALF-YEAR RESULTS2016 AND OUTLOOK

29 September 2016

1Half-year results 2016

A DYNAMIC FIRST SEMESTER


- STRONG INCREASE OF SALES AND FINANCIAL INDICATORS

- More than 375,000 customer sites acquired over the period

- Revenues : €863.6M +71%

- Current operating income : €43.8M +93%

- Net income (Group share) : €52.4M x2,3

- €41.1M SHAREHOLDER’S EQUITY, €190M cash and cash equivalents + €177Mavailable financing facilities

- NET FINANCIAL DEBT DOWN TO €53.8M reduced by €94.1M

- INCREASE IN THE FREE FLOAT after the successful reclassification operation on themarket for slightly over 4% of share capital

- A REGULATORY ENVIRONMENT which is still evolving

ACHIEVEMENTS

AND KEY EVENTS


STRONG ACCELERATION IN SALES GROWTH IN FRANCE...


H1 2016 H1 2015

Customer sites acquired 376,000 229,000 ↗ 64%

Customer sites in portfolio 1,826,000 1,383,000 ↗ 32%

...WHICH TRANSLATES INTO AN INCREASE IN VOLUMES DELIVERED


Significant contribution from major accounts following the end of yellow and green regulated tariffs

June 2016 June 2015

Electricity volumes sold 7.1 TWh 3.7 TWh ↗ +93%

Gas volumes sold 2.9 TWh 2.2 TWh ↗ +32%

Breakdown of electricity volumes sold by customer segment

Professionnals 15%

Residentials40%

Majoraccounts45%

Residentials60%

Professionnals19%

Major accounts21%

H1 2016 H1 2015

SUCCESS ON THE MAJOR ACCOUNTS SEGMENT

Half-year results 2016

H1 acheviements

85,000 Customer sites acquired

277,000 Customer sites in portfolio (end of june 2016)

3.1 TWh Delivered volumes of electricity

And local authorities, public groups(38% of the portfolio)

Of which private groups(62% of the portfolio)

6

A FAVOURABLE MARKET CONTEXT

7

Source: EEX


H1 2016

8€/MWh pricedrop in less than

3 months

Optimized sourcingstrategy in a context of

significant customeracquisitions:

- Volumes of energy boughtat historical low marketprices

- Gradual forwardpurchases (up to 3 yearsahead) that allow tosecure growth in futuremargins

Opportunities seized to secure energy volumes at competitiveprices over time

STRONG SHAREHOLDER BASE, NEW STOCK STATUS


- Liquidity improvement:- 400,000 shares exchanged monthly on

average over the period Jan-June 2016 vs249,000 over the period Jan-June 2015

- Integration of new indexes (CAC Mid andSmall, CAC All-Tradable, CAC Small)

Capitalisation calculated at the closing price of the last day of the month, which explains theapparent decrease in June 2016

Successful reclassification of ECOFIN's stake in June (1,684,656 shares i.e. 4.11% of the share capital)- In the form of an accelerated placement (around €42.1M)

- Spread over multiple investors in the market- Increase in free float from 9.48% to 13.21%

754 M€ 800 M€ 817 M€

975 M€

1 195 M€1 118 M€

17,95 €18,41 €

19,53 €

22,68 €

25,56 €28,01 €

15 €

17 €

19 €

21 €

23 €

25 €

27 €

29 €

600

700

800

900

1 000

1 100

1 200

1 300

janv.-16 févr.-16 mars-16 avr.-16 mai-16 juin-16

Capitalisation and change in share price

A REGULATORY CONTEXT THAT CONTINUES TO STRUCTURE ITSELF


Constitution of a €33.0Mprovision for lossmaking contract(gas transportation capacitiesnot included in the supplysecurity mechanism of the grid)

Impact over the half-year: €31.5M

Confirmation, for thefuture and the past,that the distributioncosts included inunpaid invoices are tobe bourn by the gridoperator

Extension over 12 monthsof the service contractstarting from October 2015

Non cash impact over the half year: €(33.0M)

9

- Confirmation by the French Council of State in june 2016 of two pricedecrees annulment (July and October 2014),

- Decision not likely to be challenged,- New decrees to fix retroactive tariffs expected in H2 2016,

- Estimated impact in H2 2016: €14M

A PRODUCTION DIVISION IN LINE WITH TARGETS...


Bayet plant

→ optimisation of the plant’s flexibility

→ contribution in line with the announced targets

Landivisiau CCGT project- Notification currently being studied by the European

Commission (validation of the capacity premium mechanismstipulated in the initial call for tender)

- Answer expected by end of the year

H1 2016 H1 2015

Operating hours 1,407 hours 1,223 hours

Production 469.1 GWh 441.7 GWh

… STRENGTHENED BY THE ACQUISITION OF A NEW GAS POWER PLANT


- CCGT of 400 MW located in Marchienne-o-pont (Belgium)- Owned by the Marcinelle Energie company, wholly owned subsidiary of

the ENEL group- Production plant commissioned by Ansaldo in 2012

(Siemens technology)- Operated by around 40 people

Transaction:- Purpose: purchase of 100% of the share capital of

Marcinelle Energie- Amount: €36.5M with an earn out mechanism- Completion: by the end of 2016

Rationale:- Upstream/downstream hedging strategy- Sensitivity to changes in energy market prices reduced- Strengthening of the Group in Belgium- Technology close to that of Bayet (multiple industrial

synergies)

PRESENTATION OF 2016 HALF-YEARLY ACCOUNTS


PROFITABLE GROWTH

- BOOST IN REVENUE:• Customer acquisitions, significant increase in volumes sold especially on the major account segment

- STRONG INCREASE IN GROSS MARGIN:• Sharp organic growth in a context of optimisation of supply costs, along with several regulatory impacts

- CURRENT OPERATING INCOME ALMOST DOUBLED:• Close monitoring and control in personnel expenses and other operating expenses, in a context of

development of the sales business in France and Belgium and integration of the production,• GrDF incurs the transportation costs included in unpaid gas invoices prior to 2016

H1 2016 H1 2015 Change

Revenue from ordinary activities 863.6 505.7 70.8%

Gross margin 107.1 78.4 36.7%

Current operating income 43.8 22.7 93.0%

€M


50,0

60,0

70,0

80,0

90,0

100,0

110,0

120,0

130,0

CHANGE IN GROSS MARGIN


78.4

(2.5)8.5

(33.0)

107.1

3.6

52.1

Organic growth

Gross margin H1 2015

Gross margin H1 2016

Neutralisation of tariff

recovery H1 2015

Net impact (from H1

2015) of the Enedis

contract extension

Provision on gas transportation

capacity contracts

Contribution from the

production division

STRONG GROWTH IN NET INCOME

GROWTH IN NET INCOME EXCEEDING THAT OF THE CURRENT OPERATING INCOME• Under the impact of the recognitions of deferred tax income related, in particular, to the Group's income

outlook

• Despite an impact of the non-cash and temporary change in fair value of €(16.8M): impact, in particular, of theunwinding of gas swaps with a strongly positive fair value at the end of 2015

Increase in financialexpenses linked to raisingadditionnal financingfacilities to supportgrowth

Half-year results 2016 15

H1 2016 H1 2015 Change

Current operating income 43.8 22.7 93%

Changes in fair value of Energy financial derivative

instruments operational in nature(16.8) 7.3

Impairment and disposals of non-current assets (0.1) (3.9)

Operating income 26.9 26.1 3%

Financial income/(loss) (5.4) (1.5)

Corporate income tax 30.5 (0.2)

Share of net income from companies accounted

for by the equity method0.3 0.0

Net income from discontinued operations 0.0 (1.2)

Net income 52.4 23.2 126%

€M

STRENGTHENING OF THE BALANCE SHEET

POSITIVE EQUITYSITUATION:Dynamic growth in incomeand reduction of negativeMTM inventoriesassociated with energyhedging derivatives, underthe effect of physicaldeliveries during the period(residual inventory:€87.5M)

€M 30/06/2016 31/12/2015

Non-current assets 174.7 145.5

Current assets 663.8 468.1

of wich cash and cash equivalents 191.4 35.2- -

TOTAL ASSETS 838.5 613.6

Shareholders' Equity excluding fair value of hedging instruments 128.9 80.6

Fair value of derivative hedging instruments (87.5) (110.0)

Shareholders' Equity 41.4 (29.4)

Non-current liabilities 222.5 224.5

Current liabilities 574.6 418.4- -

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 838.5 613.6

Half-year results 2016 16

INCREASE IN CURRENT ASSETS:Increase in accounts receivable associated with business growth Increase in available cash: strong generation ofcash flow, and implementation of additional financing

INCREASE IN CURRENT LIABILITIES:Increase in operating debts: business growth and new TICFE (domestic tax on the final consumption of electricity)operating system (formerly CSPE), implementation of additional financing over the period

Opening cash position

31/12/2015

Operating Cash flow

Change in WCR

Investment cash flows

Closing cash position

30/06/2016

FinancingCash flows

0

20

40

60

80

100

120

140

160

180

CHANGE IN CONSOLIDATED CASH POSITION: +€158.2 M

(In €M)

32.0

90.7

(4.3) 22.5

49.3

190.2

A significant improvement to the cash position over the 1st half-year 2016 • Very strong increase in operating cash flow under the impact of business growth • Positive investment flow, thanks to the reduction of cash deposits for margin calls• Financing flows translating the strengthening of the company's financial flexibility


A STRENGTHENED FINANCING STRUCTURE


New credit lines secured to support growth:

€120M Doubling of the RCF

€60M Set up of a dedicated credit line by the clearer to finance margin calls

€55M Shareholder support in the form of current accounts

Strong reduction in net financial debt Improved financial flexibility

- Available cash: €190.2M

- Undrawn credit facilities: €177M

- Net financial debt:

€53.8M compared to €147.9M at31/12/2015

- Net financial debt restated for cashmargin calls:

€20.7M compared to €83M at31/12/2015

UPDATING OF 2016 ANNUAL TARGETS


UPWARDS REVISION OF 2016 TARGETS


Acquisitionsof customer sites

Revenueat normal temperatures

Operating current incomeat normal temperatures

Growth of portfolio > 20%

>35% >30%PREVIOUS TARGETS FOR FY 2016 (march 2016)

REVISED TARGETS FORFY 2016

> 2 million customers

>€1.5bn Around €85M

The new targets include the estimated impact of the tariff catch up (around €14M).

20

21

Q&A


22

ANNEXES


Profit and loss account


In thousands of euros 30/06/2016 30/06/2015

Revenues excluding Energy Management 859 008 506 520

Energy Management Margin 4 557 (867)

Revenue from ordinary activities 863 565 505 653

Cost of sales (756 490) (427 281)

Gross margin 107 075 78 373

Personnel expenses (17 167) (13 631)

Other operational income and expenses (31 506) (31 308)

Depreciation and amortisation (14 575) (10 721)

Current operating income 43 826 22 713

Changes in fair value of Energy financial derivative

instruments operational in nature(16 781) 7 322

Disposals of non-current assets (11) (3 356)

Impairment of non-current assets (112) (550)

Operating income 26 923 26 129

Cost of net debt (5 237) (1 504)

Other financial income and expenses (138) 2

Financial income/(loss) (5 375) (1 501)

Corporate income tax 30 533 (190)

Share of net income from companies accounted for by the

equity method332 (14)

Net income from continuing operations 52 414 24 424

Net income from discontinued operations - (1 236)

Net income 52 414 23 189

of which Net income, Group share 52 414 23 189

Earnings per share (in €) 1,28 0,57

Diluted earnings per share (in €) 1,21 0,55

Balance sheet: assets



Intangible assets 44 182 40 949

Property, plant and equipment 46 345 47 661

Investments in associates 1 306 902

Non-current derivative financial instruments 7 918 8 494

Other non-current financial assets 1 146 1 458

Other non-current assets 5 759 5 279

Deferred tax assets 68 085 40 780

Non-current assets 174 741 145 522

Inventory 23 313 36 245

Trade receivables 321 604 220 596

Current derivative financial instruments 23 666 35 843

Other current financial assets 40 511 70 688

Other current assets 63 223 69 500

Cash and cash equivalents 191 436 35 230

Current assets 663 752 468 102

TOTAL ASSETS 838 492 613 624

Balance sheet: liabilities


Share Capital and share premiums 12 193 9 003

Retained earnings and profit or loss 116 751 71 717

Treasury shares (52) (88)

Other comprehensive income (87 512) (109 981)

Shareholders' Equity - Group share 41 380 (29 350)

TOTAL SHAREHOLDERS' EQUITY 41 380 (29 350)

Non-current provisions 33 041 5 051

Non-current derivative financial instruments 57 517 81 354

Other non-current financial liabilities 115 413 114 829

Other non-current liabilities 2 545 2 164

Deferred tax liabilities 13 941 21 130

Non-current liabilities 222 457 224 528

Current provisions 11 692 6 776

Trade payables 128 624 187 818

Current derivative financial instruments 89 246 83 851

Other current financial liabilities 134 951 69 113

Other current liabilities 210 143 70 887

Current liabilities 574 656 418 446

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 838 492 613 624

Consolidated statement of cash flows



Consolidated net income 52 414 23 189

Tax expenses/income (30 533) 190

Financial income/(loss) 5 375 1 501

Income before taxes and financial expenses 27 255 24 880

Depreciation and amortisation 14 575 10 721

Impairment 112 550

Provisions 31 446 3 168

Expenses related to share-based payments 862 559

Change in deferred taxes with no income impact (0) (0)

Change in fair value of financial instruments 16 781 (8 848)

Other financial items with no cash impact 11 4 892

Share of income from affiliates (332) 14

Items with no cash impact 63 456 11 055

Change in working capital requirement (4 248) (50 934)

Net cash flow from operating activities 86 464 (14 999)

Acquisition of fixed assets (16 502) (12 175)

Disposals of fixed assets - 3

Change in deposits and guarantees 35 644 (3 457)

Change in financial assets - (164)

Net change in loans originated by the company 3 356 (604)

Net cash flows used in investment activities 22 497 (16 398)

Sums received from shareholders during capital increases 3 190 -

Treasury shares 36 27

Proceeds from borrowings 117 494 25 128

Repayment of borrowings (60 870) (533)

Interest paid (2 975) (1 139)

Interest received 657 355

Dividends paid (8 242) (6 118)

Net cash flows used in financing activities 49 291 17 721

Net change in cash and cash equivalents 158 250 (13 676)

Net change in cash and cash equivalents from discontinued operations - (28)

Cash and cash equivalents at beginning of year 31 993 31 308

Cash and cash equivalents at end of year 190 243 17 605

HALF-YEAR RESULTS 2016 AND OUTLOOK · Half-yearresults 2016 15 H1 2016 H1 2015 Change Current...

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