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Nov 8, 2022
11/08/2022 | 10:24am EST Message : Thursday, 3rd November 2022 This transcript of MPC Energy Solutions NV's webcast and conference call is produced by a third party. MPC Energy Solutions takes no responsibility for possible discrepancies between this transcript and the original audi- ocast and conference call. This transcript contains minor modifications from the original for accuracy or clarifica- tion, none of which change the substance of the original. Please also refer to the cautionary statements included in the webcast slides. INTRODUCTION WELCOME Good morning to all and welcome to the Q3 2022 webcast of MPC Energy Solutions. My name is Heike, and I have the pleasure of guiding you through the presentation and the Q&A session later on. This morning at 7.00, MPC Energy Solutions published its financial statements for the nine months ended 30th September 2022. We would therefore like to take the opportunity to walk you through some of the highlights of the financial statements and also share some insights into project updates of the last few weeks with you. After our presentation, we will, as usual, hold a Q&A session, in which we'd be happy to answer any questions you might have. You can send in your questions via the text function in the webcast at any time during the presentation, and we will answer them at the end. This webcast is being recorded and will be published later together with a transcript. Before we get started, let me remind everyone that certain statements made on this call, including financial estimates and comments about our plans, expectations, beliefs, or business prospects, and other statements that are not historical in nature may constitute forward-looking statements under the securities laws. We make these statements on the basis of our views and assumptions regarding future events and business performance at the time we make them. And we do not undertake any obligation to update these statements in the future. Forward-looking statements are subject to a number of risks and uncertainties. And actual results may differ materially from the results expressed or implied in light of a variety of factors, including factors contained in our financial statements, filings and other releases. Okay. Let me now move on and introduce you to the management team of MPC Energy Solutions. I have with me, Martin Vogt, the CEO, and Stefan Meichsner, the CFO of the company. Please go ahead, Martin and Stefan. OUR BUSINESS AND STRATEGY INTRODUCTION Thank you, Heike. Good morning also to everyone from my side. Very excited to present today our Q3 results and go into some of the most recent developments in our projects, and also as it's the last time that we have the opportunity to speak to this audience. This year, we also wanted to recap on MPC Energy Solutions as an organ- isation. So Heike, if you may move forward to the slide next. Thank you. MPC Energy Solutions │ Making clean energy happen! 2 Thursday, 3rd November 2022 So, as you all know, we started last year only with a very small group of management and colleagues and have grown the company to about 20 full-time employees during the last 18 months and since the IPO. So the management and our colleagues from the Supervisory Board as well as from the team in Amsterdam, Panama and Co- lombia, we took the time to develop a joint vision, mission and purpose statement. We believe this is very critical for an organisation that is culturally and geographically diversified like MPC Energy Solutions, and really serves in the future as a focal point that helps to align everyone with the organisation, ensuring everyone is working towards a single purpose and as an effective guide for decision making. MAKING CLEAN ENERGY HAPPEN! So you see here on this slide, the results of our vision and mission. I think it's self-explanatory. Very important for us are, of course, the sustainability aspects in our business, first of all, to preserve the resources for future generations in the way how we conduct our business to work with respect to the local communities that we are affecting heavily with our activities. And in the next step, what we will present to the public shortly is the sustainable value strategy that we have developed based on our vision, mission and purpose statement. And we have adapted accordingly our environmental social management system, so that all these management tools are fully aligned with these statements. COMPREHENSIVE VALUE CHAIN Full-cycle Independent Power Production (IPP) Now, focusing on the business model itself and to recap for everyone: the comprehensive value chain that MPC Energy Solution is part of and applying. I would like to highlight here again, from our perspective, one of the main key differentiators in our value chain also compared to our peers is the true and sole focus on the needs of our clients. We are truly technology-agnostic and try to implement a technical and commercial solution that meets the requirements of our clients when it comes to renewable energy penetration, affordability, reliability, as well as source of energy. I do believe it is a key differentiator to some of our peers. And of course, we remain a long-term partner throughout the project cycle from the development over the financing into the operations until these assets are reaching end of lifetime. MARKET CHARACTERISTICS Delivering affordable and clean energy Going into our market characteristics and why we have chosen to be active in Latin America and the Caribbean Islands, and why we keep our focus on these core markets for the moment. It's really that we find very attractive local conditions to invest. First of all, we have the very strong ambition of the governments that have all set binding goals and NDCs. Next week, we will see COP 27 starting in Egypt. And we believe also from that perspective, there will be a new push in the region for a faster energy transition, especially for the small island development states as well as for the remaining developing markets that we are active in. So from that side and the policymakers and the regulators, we see continued support when we approach with our projects, the private and public sector. Furthermore, we still see that there is a limited renewable energy base, meaning strong growth prospects for companies like us in the markets. The rationale below remains the same. We have a high abundance of solar and MPC Energy Solutions │ Making clean energy happen! 3 Thursday, 3rd November 2022 wind resources. We have a very strong dependency on fossil fuels, still on diesel and HFO. In some countries, there was a shift towards natural gas massively in the last three to five years. However, as we experience at the moment a global energy crisis, the reference prices on Henry Hub have materially increased. And that has led to a moment also for the government to recognise that only a true diversification away from fossil fuels can be the key to independence, considering the price movements for natural gas lately. On the other hand, we continue to see high local generation costs, given the outdated technology that is being active since 30, 40 years. Replacing this with state-of-the-art technology, renewable energy remains truly the cheapest source of generation. And another benefit that we see that is not listed here is that all of these markets, given their size, have relatively high entry barriers that for us, as an established player, creates some level of protection; but also that the contracts that we are signing are in US dollars, meaning we have limited exposure to FX movements, except for Colombia, where we do sign PPAs in local Colombian Pesos. REGIONAL FOOTPRINT Providing clean and affordable energy for Latin America and the Caribbean Moving over to our regional footprint. I think we can say by now that MPC Energy Solutions has the broadest asset base across the region. Diversification remains a key risk mitigator in our strategy. So, there's a reason why we are targeting the entire region despite in itself each of these markets being fragmented and a niche market. We do not want to assume any cluster risks when it comes to our off-take and counterparties, as well as to seek protection from regulation and policy changes. Therefore, we believe that our current strategy provides very attractive risk adjusted returns for our shareholders. And at the moment, we can clearly say that we're the only player with such a broad footprint across the region compared to many of the other European IPPs that are also active. SOLAR GROWTH OPPORTUNITIES Expanding our development backlog in the region with focus on solar projects Looking at the growth path on the next slide, we wanted to show where we see the growth opportunities. We have highlighted here today, in particular, the solar growth, because for the region, solar energy will be the key tech- nology. 70-80% of the energy transition will be fuelled by solar technology. Of course, wind also plays a role combined with other technologies such as biomass and geothermal. But by far the vast majority is being created through solar, which you can also see already in our existing portfolio. So our goals for the next three years is to create a proprietary project development backlog of around 800 megawatts of ready-to-build assets. Projects that are fully permitted reaching financial close and are ready for construction that is doubling our current capacity of about 400 megawatt that we do have already in the region, focusing on four key areas. We have two, what we would consider the most developed markets, which are also OECD members, that is Mexico and Colombia, that are currently seeing major growth in renewables, but also the Central American region as well as the Caribbean. In Central America, we will particularly look at Panama, Guatemala and El Salvador. And in the Caribbean, at the larger islands, like the Dominican Republic, Jamaica, as well as the Eastern Caribbean islands, that all have very ambitious plans to decarbonise their energy metrics. We have shifted clearly our focus more towards own project development in the region. It's a very good moment to do so compared to our focus this year that was primarily on the construction of the first series of assets that we have brought to the IPO and capitalised. MPC Energy Solutions │ Making clean energy happen! 4 Thursday, 3rd November 2022
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Where is MPC Energy Solutions's headquarters?
MPC Energy Solutions's headquarters is located at Strawinskylaan 1547, Amsterdam.
What is MPC Energy Solutions's latest funding round?
MPC Energy Solutions's latest funding round is IPO.
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