Solaria Energía y Medio Ambiente

head of IR of Solaria. I am joined today by Arturo Díaz-Tejero Larrañaga, our chief executive officer. During this call, we'll discuss our business outlook and make forward-looking statements. These comments are based on our prediction and expectation as of today. During this presentation, we'll begin with an overview of the result and main highlights and main development during this period given by our CEO, Arturo. Following this, we will move on to the Q&A session. I would also like to highlight that you have to submit all your questions via the web. So thank you very much again, and I will now hand over the word to Arturo.

Thank you, David, and thank you to everyone joining this conference call. Like always, I will move extremely fast around the slides and the presentation, and we will go to the Q&A session. In the first half of 2025 we have increased significantly exponentially our net profits. We have grown close to 100%. That is a record in the history of the company. And we have installed, this is something significant because you know that during the last two years we have done enormous efforts in order to connect new installations. We have connected during this quarter 300 MW. That is one of our key targets for this year, and we have connected during this quarter 300 MW. From an operational point of view, our business is running great, because we closed, as you know, during this first half, a great deal with Stompik for generia. And our infrastructure business is running great and we have included numbers in this quarter that come from our infrastructure division and generation is going in a good situation even with a low prices situation that we are living in Spain. But we maintain the same level. If you compare first half with last year we maintain the same level of generation. That is good because we haven't included new assets during the first half. The good point is that finally we have connected 300 MW and hopefully during this quarter and next quarter we are going to complete 3 GW of capacity constructed and connected to the grid that it will be a great success for the company. Points or key points of this presentation. all the market is talking about batteries and new business that is growing in Europe especially in Spain around batteries Solaria absolutely will be there and during our investor day we will give a great we will give our business update about battery business and my comment about batteries is we are the key player today in Spain with batteries under construction that will be connected to the grid during October for our investor day we will have batteries connected to the grid this is a great success for the company because we will be able to play the game of battery in Spain with high volume of batteries connected to the grid And we will talk about our new division of data center during the investor day. And it's something that we are extremely excited around data center business and the growth of this business. Today, first half presentation numbers in order to go directly to the numbers. Growth, 3 gigawatts installed that we will finish for the end of this year. We are going to finish this year with 3 gigawatts of capacity connected to the grid. It's a great success. Probably from volume point of view, Solaria will be the leader from volume point of view in the Iberian region of solar photovoltaic technology connected to the grid. 3 gigawatts, 3000 megawatts connected to the grid. Under construction, today we have around 4.4 gigawatts of capacity connected to the grid or under construction, we have added new developments to our under construction pipeline, Oliva, Mantia, Villaviciosa, large installations that will be constructed during 2025, 2026 and 2027, and that will add 1.4 GW of additional capacity during 2026 and third half of 2027. It's significant because it's an enormous volume of megawatts that includes not only solar, include PES, include batteries, that jointly is a great combination from business point of view. Solar with batteries that will optimize price of electricity. Batteries, as I have mentioned, Three important points around battery business. I could say, like in solar technology, that Solaria probably is the best in class from CAPEX perspective. 75,000 euros per MWh, all connected. That is a record from CAPEX perspective view. And as I have mentioned, during October we are going to connect our first battery to the grid. And for the investors, they will have batteries functioning connected to the grid. And it's a great success for us. It's something that changed completely our history because we are going to optimize the price of electricity. We could enter at night or in the afternoon with, you know, the situation especially in Spain, high price of electricity in the afternoon, at night, and we could obtain enormous profits associated to these batteries. We are going to install more, absolutely. We are going to invest more in batteries. We are developing an enormous volume of batteries globally in Spain, not only in Spain. We have included in this presentation slides associated with Italy, Germany, with the United Kingdom, but obviously focused in Spain. We have an enormous volume of megawatts per hour of batteries that we will introduce in 2025-2026. And we will be the leader in the short term in batteries in Spain. And this is extremely important. Short term. Batteries are great business today. We need to use this opportunity and timing is critical. You need to be the first and you need to be the most efficient. Not only batteries. Wind, data center. The global business plan of Solaria, the global idea of Solaria is a global energy player that supply solar electricity, wind electricity. that has demand that comes from data centers and that has demand that comes from batteries. And it's a global solution for customers that includes technology of generation and technologies of demand. And globally in Europe, not only in Spain, focused in several countries of Europe, Spain, Italy, Portugal, Germany, United Kingdom. Generia. Generia. You know that two years ago sounds like a dream. Generia Land Company. Today it's a real company that is functioning and that will give to all of our shareholders strong success. Because, as you know, we have got a great agreement with Stone Peak. It's functioning. We are developing the pipeline of Generia. We are executing and we are closing acquisition of land. It's the beginning. Obviously, the plan is extremely ambitious. And during 2025, 2026, 2027, you will see a lot of deals associated with Generia. Obviously, if you want to construct all of these assets, if you want to construct new batteries, new data centers or whatever you need financing, good financing terms, this is a good example like all the quarters we show to the market that we have a strong capacity to raise money, to raise project finance debt with our banks and partners. Recently we have closed a new deal with Sabadal Bank, 175 MW of solar PV capacity. The key points of this deal is probably 22 years, close to 100 millions of euros of debt, that is a global capex of 0.50 something, and a link with a 70 MW PPA data center project. We will extend and we will give more information during the investor day. But in our case this is something signed, real and that is functioning now and we have under construction today the project associated with this deal. Europe. We have included several slides because usually people say Solari is extremely focused in Spain. You are not out of Spain. It is not the truth. Spain today is obviously our key market in Europe, but we don't forget other countries that are critical for us, that are going to grow around batteries, data center, solar and wind. Italy. In Italy, we have made a strong effort during the last years, and I think that today we have a really good pipeline. Hopefully before the end of this year, we will receive final authorization for close to 1 gigawatt. That is a great success, because to start with 1 gigawatt will be great for us. It's a diversification of our business. In my mind, the perfect photo for the company should be to stay in Spain with global volume, but to maintain good volume in Italy, in Portugal, in Germany, and to install generation in these three countries, in Italy, Portugal, and Germany. And the Italian business is in a good situation today. As I have explained for the full year's presentation, we will give an update with one gigawatt ready to start with the construction. And it's great. At the same time we are developing batteries, we are developing data centers. Germany, Germany is the same. In Germany we are more focused in generation, especially in solar and some applications of wind, but especially solar is the beginning. We have a good amount of megawatts. In my mind, it's easier than Italy or Spain. It's a different market, really professional, really mature market. And I think that in the past we had a strong successful market. in solar in Germany and we are going to replicate. Today we have more than 500 MW in a good situation, fully authorised, and we will start construction soon, probably in 2026. Portugal. Portugal, this is a real global project. As you know we have assets functioning today in Portugal. We have done several projects in the last years in Portugal with great success. In Portugal we have fully authorized a global project with close to 500 MW of solar and close to 200 MW of wind. We are waiting for the final substation that should be done or that depends on the government, national agency and depends on government hopefully we could start with the construction in 2027 from permitting process point of view is fully complete the key point here is that we depend on the connection infrastructure that should be constructed by REN. I think that 2027 is a conservative schedule for starting with the construction. UK. In UK we are not going to be involved in generation. We are going to be involved in other activities. Today we are only talking about batteries and we are only talking about data centers. But I talk about other activities and I'm not including here all the activities that we are working on in United Kingdom. Not in generation, we are not going to stay involved in generation. We are interested in other activities that we will explain to the market. Numbers I have mentioned and I will move extremely fast. EBITDA, record of EBITDA 140. In order to give additional information to the market, as you remember, we gave a guideline for the year of 245, 255 millions of euros for the end of this year of EBITDA. I can say that we are extremely comfortable with this number. What does it mean? We have strong visibility that we are going to accomplish with the guideline of EBITDA for 2025. During the investor day, the 17th of November, we will give guideline for next years and global business plan for next years. Production, we maintain levels of production as I have explained at the beginning. We have maintained similar numbers from generation point of view. A small reduction on production associated with less sun radiation, especially in the first half of this year. I can say that the third quarter was good from radiation point of view and price. It's good. And especially second quarter of this year was not good from radiation point of view. small decrease associated with this solar radiation. Average selling price, even I can say that it's better if you compare first half 2024, first half 2025. Contracted merchant, 75 today is contracted, 25 is merchant. As we have explained, and it's not a surprise, we are going to maintain this mix and we are going to sign additional PPA contracts and we are going to maintain this proportion of 75 contracted, 25 merchant. EBITDA continues growing and is affected by three different activities, by infra-business, by generation, and by area. I can say that, as I have explained at the beginning, it's around one-third productivity and all the activities are functioning great. Why I'm saying this? Because I have visibility of third quarter and I think numbers are functioning great. As I have said previously, we have extremely high level of comfort of our guideline of EBITDA. Cash, we maintain the same level of cash like always. As you know, we are not rich, but we continue... making strong investments and we maintain our discipline around CAPEX. That is one of the key points of our strategy. We have a global CAPEX of less than 0.38 euros per watt. That is probably best in class. And in my mind we are going to improve in the next quarters. I think that probably for the first quarter of 2026 we will achieve a record in CAPEX When I talk about record I think that number is going to surprise to the market but we are going to improve a lot even our capex and this is critical for us because as you know we are covering all of our capex with project finance and it's critical for us to be effective not only in the construction of solar installation, in batteries, in wind, in all of our applications. And of course a bit of evolution is great if you compare the last five years. It's impressive. It's not as we want to get because we want more, much more. We want to grow more. We want to be the leader. And unfortunately during the last two years we had delays in the construction. The good point today is that we are in the good moment connecting megawatts, and we are going to finish with all the megawatts under construction connected to the grid. And it's great. And it's part of our guideline of last year, and we are going to accomplish it. Solaria transformation plan sounds ambitious, but we are ambitious as always. And on November 17th, We will present to the market our view about data center, batteries, where we are, where we will be, and what we are going to do for financing all, and it will be extremely interesting. You know, Solaria today is a key player in Europe, focused on solar, wind, data center, and batteries, and we will try to explain Our global view of the market and where we are going to stay the next three years. And where will be the company in the next three years. And before to enter in the Q&A session, in order to give more information, we will be focused in the remuneration of the shareholders. We think that is something that we need to improve and we need to stay focused there. we will continue acquiring shares and as you know in the first quarter we have announced a shares buyback program and we have today 2% of the shares of the company and we are going to continue with the acquisition of shares at least until 10% and we are going to maintain this discipline and we are going to execute and at the same time and in order to be fair with the market understand this comment but probably company in the next days could sign contracts impressive contracts that will give visibility to our business plan and to all the activities of the company and we will explain during the investor day of the 17th of November Q&A if you want

So thank you, Arturo. I will now open for Q&A session. And once again, thank you for your time. Just let us have one minute. So the first question comes from Fernando Garcia from RBC. Could we elaborate on the sentence evaluating additional options to boost shareholder returns?