Kenon Holdings Reports Full Year 2023 Results and Additional Updates
Q4 and Recent Highlights
Kenon
- In
March 2024 , Kenon's board of directors approved a cash dividend of approximately$200 million ($3.80 per share) payable inApril 2024 .
OPC
- Financial results:
- OPC's net profit in 2023 was
$47 million , as compared to a net profit of$65 million in 2022. OPC's 2023 net profit included its share in profit of CPV of$66 million as compared to$85 million in 2022. - OPC's Adjusted EBITDA1 (including proportionate share in Adjusted EBITDA1 of associated companies) in 2023 was
$304 million as compared to$250 million in 2022.
ZIM
- Financial results2:
- ZIM reported a net loss in 2023 of
$2.7 billion , which included a non-cash impairment of$2.1 billion , as compared to net profit of$4.6 billion in 2022. - ZIM reported Adjusted EBITDA1 in 2023 of
$1 billion , as compared to$7.5 billion in 2022.
Discussion of Results for the Year ended
Kenon's consolidated results of operations from its operating companies essentially comprise the consolidated results of OPC Energy Ltd ("OPC"). Our share of the results of
See Exhibit 99.2 of Kenon's Form 6-K dated
OPC
The following discussion of OPC's results of operations is derived from OPC's consolidated financial statements, which are denominated in NIS for purposes of OPC's financial statements, as translated into US dollars for Kenon's financial statements.
|
Summary Financial Information of OPC |
|
||||||
|
|
For the year ended |
||||||
|
|
2023 |
|
2022 |
||||
|
|
$ millions |
||||||
|
Revenue |
692 |
|
574 |
||||
|
Cost of sales (excluding depreciation and amortization) |
(494) |
|
(417) |
||||
|
Finance expenses, net |
(53) |
|
(14) |
||||
|
Share in profit of associated companies, net |
66 |
|
85 |
||||
|
Profit for the period |
47 |
|
65 |
||||
|
Attributable to: |
|
|
|
||||
|
Equity holders of OPC |
40 |
|
50 |
||||
|
Non-controlling interest |
7 |
|
15 |
||||
|
|
|
|
|
||||
|
Adjusted EBITDA3 |
304 |
|
250 |
||||
|
|
|
|
|
||||
|
For details of OPC's results please refer to Appendix B. |
|||||||
|
|
|
|
|||||
|
|
|
|
|||||
|
|
|
|
|||||
|
Revenue |
|
|
|||||
|
|
For the year ended |
|
|||||
|
|
2023 |
|
|
2022 |
|
||
|
|
$ millions |
|
|||||
|
|
|
|
|||||
|
|
619 |
|
|
|
|
517 |
|
|
|
73 |
|
|
|
|
57 |
|
|
Total |
692 |
|
|
|
|
574 |
|
OPC's revenue increased by
OPC's revenue from the sale of electricity to private customers is derived from electricity sold at the generation component tariffs, as published by the
Set forth below is a discussion of changes in the key components in revenue for 2023 as compared to 2022.
-
Revenue from sale of energy to private customers in
Israel – Increased by$25 million in 2023 as compared to 2022. Excluding the impact of translating OPC's revenue from NIS to USD, such revenues increased by$57 million primarily as a result of (i) an increase of$49 million from an increase in customer consumption and (ii) an increase of$24 million from the consolidation of results of the Gat Power Plant which was consolidated starting in Q2 2023, partially offset by (iii) a decrease of$9 million as a result of the change in demand hour brackets; -
Revenue from private customers in respect of infrastructure services – Increased by
$36 million in 2023 as compared to 2022. Excluding the impact of translating OPC's revenue from NIS to USD, such revenues increased by$45 million , primarily as a result of (i) an increase of$26 million from an increase in the infrastructure tariff, (ii) an increase of$12 million from an increase in customer consumption and (iii) an increase of$8 million from the consolidation of results of the Gat Power Plant beginning in Q2 2023; -
Revenue from sale of energy to the System Operator and to other suppliers – Increased by
$16 million in 2023 as compared to 2022. Excluding the impact of translating OPC's revenue from NIS to USD, such revenues increased by$18 million , primarily as a result of (i) an increase of$18 million from the commencement of commercial operations of Tzomet Power Plant inJune 2023 and (ii) an increase of$4 million from the consolidation of results of the Gat Power Plant beginning in Q2 2023; -
Revenue from capacity payments – Increased by
$16 million in 2023 as compared to 2022, primarily as a result of the commencement of commercial operations of Tzomet Power Plant inJune 2023 ; and -
Other revenue – Increased by
$5 million in 2023 as compared to 2022, primarily as a result of the commencement of commercial operations of Tzomet Power Plant inJune 2023 .
Cost of Sales (Excluding Depreciation and Amortization) |
|
|
||||||
|
|
|
||||||
|
|
For the year ended |
||||||
|
|
2023 |
|
|
2022 |
|||
|
|
$ millions |
||||||
|
|
|
||||||
|
|
|
453 |
|
|
|
385 |
|
|
|
|
41 |
|
|
|
32 |
|
Total |
|
|
494 |
|
|
|
417 |
OPC's cost of sales (excluding depreciation and amortization) increased by
-
Natural gas and diesel oil consumption in
Israel – Increased by$23 million in 2023 as compared to 2022. Excluding the impact of translating these costs from NIS to USD, such costs increased by$37 million primarily due to (i) an increase of$11 million from the consolidation of results of the Gat Power Plant beginning in Q2 2023, (ii) the commencement of commercial operations of Tzomet Power Plant inJune 2023 , (iii) an increase of$14 million due to an increase in the generation component and the USD/NIS exchange rate and (iv) an increase of$14 million as a result of an increase in the quantity of gas consumed, partially offset by (v) a decrease in gas expenses of$14 million as a result of the commencement of delivery of gas from Energean from Q2 2023; -
Expenses for infrastructure services in
Israel – Increased by$36 million in 2023 as compared to 2022. Excluding the impact of translating these costs from NIS to USD, such costs increased by$45 million primarily as a result of (i) an increase of$26 million linked to the infrastructure tariff, (ii) an increase of$12 million due to an increase in customer consumption and (iii) an increase of$8 million from the consolidation of results of the Gat Power Plant beginning in Q2 2023; and -
Operating expenses and other expenses – Increased by
$20 million in 2023 as compared to 2022. Excluding the impact of translating these costs from NIS to USD, such costs increased by$22 million primarily as a result of (i) the commencement of commercial operations of Tzomet Power Plant inJune 2023 and (ii) consolidation of results of the Gat Power Plant beginning in Q2 2023.
Finance Expenses, net
Finance expenses, net in 2023 was
Share of Profit of Associated Companies, net
OPC's share of profit of associated companies, net decreased by
For further details of the performance of associated companies of CPV, refer to OPC's immediate report published on the Tel Aviv Stock Exchange ("TASE") on
Liquidity and Capital Resources
As of
As of
Business and other Developments
Tariff Update
On
OPC-Rotem Supply License
In
ZIM
Discussion of ZIM's Results6 for 2023
ZIM carried approximately 3,281 thousand TEUs in 2023 representing approximately a 3% decrease as compared to 2022, in which ZIM carried approximately 3,380 thousand TEUs. The average freight rate in 2023 was
ZIM's revenues decreased by approximately 59% in 2023 to
ZIM's operating loss and net loss was
ZIM's total cash (which includes cash and cash equivalents and investments in bank deposits and other investment instruments) was
Additional Kenon Updates
Kenon's (stand-alone) Liquidity and Capital Resources
As of
Kenon's stand-alone cash includes cash and cash equivalents and other treasury management instruments.
Interim Dividend for the Year Ending
In
The TASE ex-dividend date, which is the date on which Kenon's shares will begin trading on the TASE without the entitlement to the Dividend, is
We encourage you to contact your bank, broker, nominee or other institution if you have any questions regarding the mechanics and timing of having the Dividend attributable to your shares credited to your account.
Bilateral Investment Treaty Claims Relating to
In
As previously disclosed in Kenon's Form 20-F,
The ICSID Award is subject to tax.
Qoros update
In
In addition, the lenders under Qoros'
1 Adjusted EBITDA is a non-IFRS measure. See Exhibit 99.2 of Kenon's Form 6-K dated
2 Represents 100% of ZIM's results. Kenon owns and owned during the years ended
3 Non-IFRS measure. See Appendix C for a definition of OPC's Adjusted EBITDA and a reconciliation to profit for the period.
4 The table above and corresponding comparison relating to 2023 and 2022 were converted using an average exchange rate of
5 Comparing 2023 and 2022 using the average exchange rate of
6 Represents 100% of ZIM's results. Kenon owns and owned during the years ended
About Kenon
Kenon has interests in the following businesses:
- OPC (55% interest) – a leading owner, operator and developer of power generation facilities in the Israeli and
U.S. power markets; - ZIM (21% interest) – an international shipping company.
Kenon has agreed to sell its remaining 12% interest of Qoros, a
For further information on Kenon, including its businesses and strategy, see Kenon's publicly available filings, which can be found on the
Caution Concerning Forward-Looking Statements
This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include statements relating to (i) with respect to OPC, including tariff rates and the Supply License Resolution, including the provisions thereof, (ii) Kenon's announced dividend, (iii) the ICSID Award including interest payable on the ICSID Award, procedural steps that have been or may be taken with respect to the ICSID Award and the agreement with a capital provider and its entitlement to a portion of the ICSID Award, (iv) the CIETAC Award and Quantum's intention to enforce the CIETAC Award, the court order in respect of the payment default by Qoros and impact of such order and (v) other non-historical matters. These statements are based on current expectations or beliefs and are subject to uncertainty and changes in circumstances. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond Kenon's control, which could cause the actual results to differ materially from those indicated in such forward-looking statements. Such risks include (i) tariff rates applicable to OPC for 2024, and risks relating to the terms of the Supply License Resolution and the impact on OPC-Rotem, and other risks, (ii) risks relating to payment of Kenon's announced dividend, (iii) risks relating to the ICSID Award including a potential application to annul the ICSID Award, Kenon's ability to enforce the ICSID Award and collect the amounts awarded thereunder and interest payable thereon, and amounts payable to the capital provider and to Kenon, (iv) risks related to the CIETAC Award, including the risk that Quantum may be unable to enforce the CIETAC Award or otherwise collect the amounts awarded or otherwise owing to it, and risks relating to the order in respect of the payment default by Qoros and the pledge by Quantum of its 12% interest in Qoros including the risk of enforcement of the pledge and impact thereof and (v) other risks and factors including those risks set forth under the heading "Risk Factors" in Kenon's most recent Annual Report on Form 20-F filed with the
Contact Info
|
|
|
|
Chief Financial Officer Tel: +65 9669 4761 |
|
View original content:https://www.prnewswire.com/news-releases/kenon-holdings-reports-full-year-2023-results-and-additional-updates-302099606.html
SOURCE