ABOUT INFIGEN (ASX: IFN)

Infigen is a leading ASX listed energy market participant delivering energy solutions to Australian businesses and large retailers. Infigen supplies clean energy from a combination of renewable energy generation and firming solutions available from the broader energy market to Australian business customers. Infigen assets are located across New South Wales, South Australia and Western Australia.

Image Map
Alinta Wind Farm, 89.1MW
Lake Bonney Wind Farm 1, 80.5MW
Lake Bonney Wind Farm 2, 159.0MW
Lake Bonney Wind Farm 3, 39.0MW
Lake Bonney Battery, 25 MW / 52 MWh
(under construction)
Capital Wind Farm, 140.7MW
Capital East Solar Farm, 0.1MW
Woodlawn Wind Farm, 48.3MW
Bodangora Wind Farm, 113.2MW
(under construction)

1. Alinta Wind Farm, 89.1MW
2. Bodangora Wind Farm, 113.2MW
(under construction)
3. Capital Wind Farm, 140.7MW
4. Capital East Solar Farm, 0.1MW
5. Lake Bonney Battery, 25 MW / 52 MWh
(under construction)
6. Lake Bonney 1, Wind Farm 80.5MW
7. Lake Bonney 2, Wind Farm 159.0MW
8. Lake Bonney 3, Wind Farm 39.0MW
9. Woodlawn Wind Farm, 48.3MW

2018
Highlights.

1,480GWh
Production sold increased 6%
$149.1M
Underlying EBITDA increased 7%
$210.1M
Net Revenue increased 7%
60¢
Net Assets per Security increased 20%
$100.4M
Net operating cash flow increased 2%
$45.7M
Net Profit after Tax increased 41%
“During the past year we have made solid progress: reducing and refinancing our corporate debt, generating free cash flow and investing in growth. This has created an opportunity for the Board to consider the reintroduction of distributions.”

CHAIRMAN AND MANAGING DIRECTOR’S REPORT SUMMARY

FY18 Highlights

In FY18, Infigen reported earnings of $45.7 million from current operating assets reflecting higher generated production (1,549 GWh) and the benefits of the Multi-Channel Route to Market strategy returning improved electricity prices. Net revenue was $210.1 million, underlying EBITDA was $149.1 million and reported free cash flow generated was $97.8 million.

During the year we executed a $605 million syndicated facility agreement and paid down corporate debt by $138 million. The new Corporate Facility is an important step in giving Infigen the capital structure to pursue our strategy while at the same time creating flexibility for the Boards to consider reintroducing sustainable distributions to security holders in the future.

An integral aspect of becoming an active energy market participant is the delivery of a range of products and solutions to Commercial and Industrial (C&I) Customers and energy retailers through the Multi-Channel Route to Market strategy. Through this strategy we sell our generation through a number of channels: purchase power agreements to third parties such as energy retailers; medium to long term contracts with C&I energy users; and spot sales in the energy market.

In FY18 we saw the benefit of this sales strategy: in South Australia, for example, Infigen’s reduced exposure to the spot market as a result of C&I contracting, meant that the average price received from electricity sales in FY18 was largely in line with FY17 despite a decline in wholesale electricity prices in the South Australian market.

Lake Bonney Battery

On 15 August 2018 Infigen announced it had entered into an agreement for the construction of a 25MW/52MWh Battery Energy Storage System (BESS) in South Australia, using Tesla powerpack technology. The battery will be located adjacent to Infigen’s 278.5 MW Lake Bonney Wind Farm. Construction is expected to be complete by May 2019.

The battery will provide firming for Infigen’s South Australian portfolio, and this access to energy storage allows Infigen to enter into additional energy supply contracts with C&I customers. There are further benefits from greater system security for the National Electricity Market and increased battery energy storage capability in the South Australian market.

It is expected that the battery will support firming of at least an additional 18 MW of energy for commercial and industrial customers, depending on their load profile.

Growth in generation – Bodangora Wind Farm

On 6 August 2018 Infigen’s Bodangora Wind Farm in Wellington, NSW, delivered its first export of energy generated to the NEM. Once fully completed the wind farm will feature 33 turbines. Depending on the wind speed, each turbine can generate up to 3.4 MW of power, providing in total enough output to supply electricity to 49,000 homes each year.

When fully commissioned the 113.2 MW Bodangora Wind Farm will increase Infigen’s installed capacity by 20% and expected annual production by 24%. This is a significant milestone for Infigen, and for the local community, and Infigen is grateful for the hard work and support of all parties involved.

VIEW THE LATEST COMMUNITY UPDATE

The year ahead

Infigen’s growth focus for FY2019 will be on the following projects:

  • Bodangora Wind Farm delivered on budget with the Energy Australia power purchase agreement on track for commencing 1H FY19
  • Entry into the Victorian market underpinned by the Kiata Wind Farm power purchase agreement
  • Potential development of Cherry Tree Wind Farm
  • BESS construction with expected first operations in 2H FY19
  • Additional physical firming options being evaluated for key markets
  • Flyers Creek Wind Farm next prospective development under consideration

As you can see we’ve had another year of solid progress as we transform Infigen to an active energy market participant. We look forward to keeping you updated on our progress and hope to see many of you at the Annual General Meeting on Friday, 16 November 2018.

Yours sincerely,

Len Gill
Chairman

Ross Rolfe AO
Chief Executive Officer / Managing Director

SAFETY & ESG

Infigen’s purpose is to offer Australian industries the supply of energy from clean sources of generation at affordable prices to assist them in reducing the impact of their activities on the global climate. Infigen believes that the business strategy must withstand changes to energy and climate change policies that often result from political debate, media and public interest. Infigen has a goal of “zero harm” to people. It aims to attract and engage skilled and talented people, who are collectively motivated to achieve business success. In adhering to responsible corporate governance Infigen has the following goals:

  1. Ensuring safety of our people and communities
  2. Responsible conduct in communities and the environment
  3. Promoting wellbeing and diversity in the workplace
  4. Contributing to energy security

Infigen’s Corporate Governance Statement sets out the corporate governance framework and the extent to which Infigen followed the Principles and Recommendations for the financial year ended 30 June 2018.

VIEW THE CORPORATE GOVERNANCE STATEMENT 2018

Run with the Wind at Woodlawn Wind Farm, October 2017