NEOEN : 9M 2020 revenue

Paris, November 9, 2020

Sustained increase in revenue in the first nine months of 2020 and targets confirmed

• Revenue totaled €224.1 million, up 22% compared to the first nine months of 2019
• Neoen commissioned 308 MW, launched the construction of 605 MW and won 409 MW of new projects during the first nine months of 2020
• The secured portfolio1 stood at 4.5 GW at end-September 2020 versus 4.1 GW at end-2019
• Neoen is confirming its 2020 EBITDA2 guidance of between €270 million and €285 million at constant exchange rates3, with an EBITDA margin4 of over 85%
• The Group is reiterating its targets for 2022

Neoen (ISIN: FR0011675362, Ticker: NEOEN), one of the world's leading and fastest-growing independent producers of exclusively renewable energy, is reporting unaudited revenue of €224.1 million in the first nine months of 2020, up 22% compared to the first nine months of 2019. At constant exchange rates, revenue was 23% higher.

Xavier Barbaro, Neoen's Chairman and Chief Executive Officer, commented: "Neoen's revenue growth in the first nine months of the year confirms the Group's growth profile. We were awarded 409 MW in new projects during the period, and since the end of September, we have won a 250 MW contract that enables us to build one of the world's largest batteries in the State of Victoria in collaboration with Tesla, plus a 110 MW wind energy project, also in Australia. All in all, we have been awarded more than 800 MW of new projects since the beginning of the year, demonstrating our ability to deliver innovative, distinctive services, in addition to the quality and competitiveness of our projects. These achievements, underpinned by our teams' flawless commitment and despite the sanitary crisis, have heightened our confidence in our ability to reach our targets".

1. Assets in operation, under construction and projects awarded
2. EBITDA corresponds to current operating income adjusted for current operating depreciation, amortization and provisions
3. Forecasts at constant exchange rates compared to 2019
4. The EBITDA margin is calculated as the ratio of EBITDA to revenue

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Operational highlights

	September 30,	December 31,		chg.
	2020	2019
	(1)	(1)
Assets in operation (MW)	2,154	1,847		+308

(1) Gross capacity including projects in which Neoen is a minority shareholder: Cestas (228 MWp) and Seixal (8.8 MWp)

Neoen's capacity in operation stood at 2,154 MW at end-September 2020, up 308 MW compared to end- December 2019. After commissioning the 143 MWp5 Capella solar facility in El Salvador, the 81 MW Hedet wind farm in Finland and three solar power plants in France with total capacity of 15 MWp during the first half of 2020, the Group completed the 50 MW expansion of the Hornsdale Power Reserve battery in Australia during the third quarter, lifting its total capacity to 150 MW. This extension further enhances its ability to stabilise the grid, curb price volatility in the market and reduce the risks of blackouts. In France, the 10 MW La Garenne wind farm and the Brègues d'Or and Antugnac solar power plants (9 MWp in total) also entered service during the third quarter.

	9m 2020	9m 2019	% chg.
Electricity generated (GWh)	3,130	2,081	+50%

Electricity generation totaled 3,130 GWh in the first nine months of 2020, up 50% compared to the first nine months of 2019. The average availability rate for solar energy and wind energy assets held up at high levels of 98% and 99% respectively (versus 99% for both segments in the first nine months of 2019) illustrating Group's ability to continue to optimize use of its generating assets.

In addition to newly commissioned assets, the El Llano solar power plant (375 MWp) in Mexico has been injecting electricity into the grid since the first quarter of 2020 6 . This facility, which just received the administrative authorization from the CENACE to start commercial operation, should be commissioned by the end of the year. The Bulgana wind farm in Australia (214 MW, including 20 MW/34 MWh in storage) also gradually began injecting electricity into the grid from the end of the first half of the year, starting with a limited capacity.

The average load factor of solar assets stood at 18%, an equivalent level to that recorded in the first nine months of 2019. The contribution from the power plants at Capella in El Salvador and El Llano in Mexico, which have higher load factors than the average for solar assets in operation, helped offset the impact of the unfavorable weather conditions in Australia in the first nine months of the year, and a temporary reduced availability level of a solar asset in Australia in the first half due to upgrading works on the grid.

The average load factor of wind assets stood at 33% over the first nine months of 2020, versus 30% in the same period of 2019. Neoen's performance was buoyed by excellent wind conditions in Europe in the first quarter and by the commissioning of the Hedet project in Finland, which has a higher-than-average load factor among wind farms in operation. Conversely, it was held back by unfavorable wind conditions in Europe during the third quarter of 2020.

1. Including a 3 MW/2 MWh storage battery
2. Except for the period from May 3 to 21, 2020 following a decision by the National Center for the Control of Energy (CENACE)

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Nine-month 2020 revenue up 22%

	9m 2020	9m 2019	% chg.
Revenue (€ m)(1)
Solar	112.7	89.8	+26%
Wind	83.7	78.3	+7%
Storage	27.2	13.7	+99%
Other(2)	0.5	2.4	n/a
Consolidated revenue	224.1	184.2	+22%
o/w contracted energy revenue	173.0	157.5	+10%
o/w merchant energy revenue	47.7	21.9	x2,2
o/w other revenue(3)	3.5	4.8	n/a

1. Unaudited financial data
2. Corresponding to the Development and investment segment
3. Other revenue chiefly comprises the development business and services to third parties

Neoen's consolidated revenue totaled €224.1 million in the first nine months of 2020, or an increase of 22% compared to the first nine months of 2019. At constant exchange rates7, revenue was up 23%. The key factor driving this growth was the contribution from assets commissioned in 2019 and the first nine months of 2020. Another contributing factor was the strong first-quarter increase in storage as a result of specific non-recurring conditions in Australia.

Solar revenue grew 26% compared to the first nine months of 2019 as a result of the contribution from projects commissioned during 2019 in Australia, Zambia, Jamaica and France, and also those commissioned in the first nine months during 2020 in El Salvador and in France. This increase also reflected early generation revenue from the El Llano power plant in Mexico since the beginning of the year. Revenue was held back by unfavorable irradiation conditions in Australia throughout the first nine months and by the reduced availability of an asset in Australia over the first six months of the year as a result of upgrading work on the grid. Revenue was also curbed by the year-on-year downturn in market prices in Australia, especially in the third quarter. Solar's contribution to Neoen's consolidated revenue stood at 50% over the first nine months of 2020, versus 49% in the same period of 2019.

Wind revenue rose 7% compared to the first nine months of 2019. This growth was powered by the contribution from the capacity added in Ireland and France during 2019 and also in Finland and France during 2020. Other contributing factors were the early-generation revenue generated in the third quarter of 2020 by the Bulgana power plant in Australia and the excellent wind conditions in Europe in the first quarter of 2020. On the other hand, Neoen's performance was held back by less supportive wind conditions in Europe during the third quarter of 2020, as well as the lower average price recorded by the Hornsdale 3 wind farm in Australia in the first nine months of 2020 compared to the same period of 2019. This asset had temporarily benefited from early generation revenue prior to the entry into force of its long-term power purchase agreement in October 2019. Wind contributed 37% of Neoen's consolidated revenue over the first nine months of 2020, versus 43% in the same period of 2019.

7 Based on the average exchange rate over the first nine months of 2019

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Storage revenue doubled in the first nine months of 2020 to €27.2 million. An exceptional event in Australia during the first quarter was the key factor behind this very hefty increase. Following a tornado in late January, a power interconnection line between the state of South Australia and Victoria was down, creating specific conditions generating a high level of non-recurring revenue. Conversely, as in the second quarter, Neoen experienced a revenue contraction in the third quarter year-on-year owing to less favorable market conditions in Australia for network services (FCAS). Storage revenue accounted for 12% of consolidated revenue in the first nine months of 2020, up from 7% in the year-earlier period.

During the first nine months of 2020, merchant energy revenue accounted for 21% of consolidated revenue. This high level is temporary as it reflects the non-recurring increase in storage business in Australia in the first quarter. Neoen also benefited from early generation revenue from the Capella8 (El Salvador) and Hedet8 (Finland) facilities in the first quarter, from El Llano (Mexico) throughout the period and from Bulgana (Australia) in the third quarter.

Third-quarter 2020 revenue up 1%

During the third quarter of 2020, Neoen recorded consolidated revenue of €66.9 million, up 1% compared to the third quarter of 2019.

Solar revenue rose 12% compared to the third quarter of 2019 as a result of the contribution from the Capella power plant in El Salvador, which entered service during the first quarter of 2020, and from early generation revenue contributed by the El Llano power plant in Mexico. However, it was depressed by unfavorable irradiation conditions in Australia and the decline in Australian market prices compared to the third quarter of 2019.

Wind revenue dropped 3% below its third-quarter 2019 level despite the start-up of generating activities at the Bulgana facility. This decline is due to a low level of wind resources in Europe and the decrease in the average price earned by the Hornsdale 3 wind farm in Australia following the entry into force of its long-term power purchase agreement in October 2019.

Lastly, Storage revenue totaled €2.6 million versus €5.3 million in the third quarter of 2019 as a result of unfavorable market conditions in Australia for the sale of network services (FCAS). Revenue was also held back by the shutdown of the Hornsdale Power Reserve battery for 14 days during testing of its extension, which entered service in September.

In the third quarter of 2020, merchant energy revenue accounted for 9% of consolidated revenue.

8 Prior to the entry into force of their PPA in Q2 2020

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