Second quarter 2022 presentation from Cloudberry Clean Energy. My name is Anders Lenborg. I'm the CEO of Cloudberry, and today I'm joined by my colleague, our CVO, Christian A. Helland. We have prepared a presentation for you that we will go through, and we will also open up for questions after the presentation. Please use the Q&A link on the page to post questions during the presentation. The agenda today, I will start off giving you an overview of Cloudberry and some of the highlights from the last quarter, and then Christian will take over and run you through the key financials. We will finish off with a short outlook and summary. Before we dive into the highlights and the financials, let me just give you a short introduction to Cloudberry. Cloudberry is a local Nordic IPP, independent power producer. We develop, own, and operate, renewable assets in the Nordics. We focus on, hydropower and wind power, and today we have a portfolio of, projects from very early greenfield projects, and up to, producing assets. We believe it's important to have the development capacity in-house so we can develop both wind on and offshore and, hydropower projects, in-house in Cloudberry. Earlier this year, we also added a third section to the company and we have now an operational team that operate all our producing assets, as we speak. We are a listed company, on the main list of Oslo Stock Exchange under the ticker Cloud. We're very happy to present, some of the highlights here today. We have a strong performance when it comes to increased revenue of seven times on a consolidated basis. We have also been able to grow the portfolio and the project portfolio. The proportionate numbers you can see on the left side here and also the consolidated numbers. This will also continue to grow over the rest of the year and the coming years. As you can see, we have a very large merchant exposure, and we feel that the strategy of having this merchant exposure has been right for us over the last years. We have been growing the portfolio, growing the volume, and we have also seen the power prices coming up from a lower level, and that's the main reasons why we have stayed merchant. We will also have a part of the portfolio in the merchant spot market going forward. You can also see that we will probably enter into PPAs or doing hedges on the portfolio to bring down the risk of the production portfolio from the level of today. On the project side, we have been able to now get both Skåråna hydropower plants on the grid. They have been finished for quite a while, but we had to wait for the grid connection. has been concluded earlier this month. Now we have Skåråna on the grid and also Bøen of course. Bøen one and two in operation and then we are working on a third power plant there with also a reservoir. On the wind side, we have the shallow water project in Vänern, 100 MW, and we are happy that we could enter into a binding term sheet with Hafslund, being one of the largest utilities in the Nordics, earlier this summer. We are now in the middle of a due diligence period, but we will hopefully have Hafslund as a partner on our first shallow water project. Odal, we have erected and energized 32 or 34 wind turbines. Two of these turbines need some repairs, but we have seen the production now picking up through the summer and just a week or two back, we reached 100 MW in production. This is moving along as reported. On the Hån project, we have finished all the infrastructure, the foundations. We have the substation in place, tested and ready. Now Vestas is moving in with the cranes and all the parts for the towers and nacelles. First power from Hån we will have earlier, sorry, later this year. What's interesting is that the value creation of NOK 8 million-NOK 10 million per megawatt is significantly above what we have seen earlier. This is based on a third-party evaluation of a similar project in SE3. Then we also see that Captiva is coming along very well. We did a sale of a small hydropower plant earlier this second quarter, a non-strategic asset. That is partly the results on the Captiva. We have also seen new contracts, new customers coming in, and we are very happy to also have the opportunity to be under the same roof as Captiva. When it comes to. On the right side here, when it comes to the installed capacity, the production capacity, we still have the development that we have reported on earlier, and we are in line with this development. So to give you a short overview, this is the portfolio. We have been able to move the projects from the backlog to construction permits to production. Growing both the backlog and the production portfolio, we are very pleased to see that this is going as planned. As you can see on the yellow box, we have four wind assets with permits and we are looking to take investment decisions on all of these over the next year. Other key takeaways is the diversity of the portfolio. As you can see, we are in the south part of Norway and the southern part of Sweden. We think this is the right price areas for Cloudberry. We are close to the consumers, we are close to the interconnectors, and we have a good solid basis of new projects also in this area. When it comes to the ESG, we have used the second quarter to go through the portfolio. We have tested all our projects, but also our producing assets to the taxonomy framework. We are now 100% taxonomy eligible on the production segment and the development segment. We will report on this for 2022. In addition to this, we have a focus on the ESG and sustainability on all our projects. Here on the right side, you see the cable from our Swedish Hån wind farm to the Norwegian substation. Hån is actually a wind farm that is producing out of Sweden, but we are selling the power in Norway. Here using existing roads and using as little of the nature as possible to make it as sustainable as possible. We will continue to have this focus also going forward. In general, we have no incidents and very low sick leave in Cloudberry over the last quarter. This slide you have seen many times before. It gives you a nice overview of our portfolio. The producing assets here in dark blue, we have mostly hydropower. When you see the light blue columns, there are two wind farms, Odal and Hån, that we have shortly touched upon. At the end of this year, we will have those also dark blue, and it will create a balance to the portfolio, which has been heavy on hydro, but it's going to be more balanced with the wind assets coming in and that giving also a better production profile through the autumn and the winter months. With this, I say thank you for your attention, and I leave the word to Christian, and then we will come back to the outlook later. Thank you. All right. Thank you, Anders. Yeah, just to continue a little bit on this slide before we dive into the financials, because I feel this explains very well how we ramp up our balance sheet and also how we see the production ramping up going forward. As Anders said, the Hån project and Odal, we expect to have in production by full production by year-end. The next ones on the list is Øvre Kvemma, where we expect to have that and financially close it by 2024. We have the four projects, Øvre Kvemma, Munkhyttan, Duvhällen, and Stenkalles Grund, all progressing very well. We see they are in attractive price areas. As Anders said, we plan to take investment decision on these ones within 12 months. We're also very pleased to join up with Hafslund. We said before we don't want too much risk in one single project. We have done a binding term sheet with Hafslund to farm down 50% on the Stenkalles project and form a joint venture with Hafslund. I will get a little bit back to that. Keep this picture in mind now when we move more into the balance sheet. As always, we've been focused on keeping a strong balance sheet to be able to take advantage of a growing portfolio. We are focused on always being well-capitalized, low degree of debt, and a strong balance sheet with strong owners to take the growth in front of us and also be able to act on short-term possibilities that we see in the market. As we see today, and Anders will also get back to it, we see large differences in the market, extremely low power prices in the Northern areas of the Nordics and extremely high prices in the South. For us to have a balance sheet and to be able to act on this is very important. We also see that the construction cost, upfront costs of new projects have increased. Turbines, materials, shipping costs have driven up some on the cost side. On the other hand, we see that the long-term expected returns on our projects are strongly improved due to higher expected power prices and more demand for power. We, depending obviously a little bit on the power prices and the revenue we create, but we have minimum funding for 270 MW and expect the long-term return on our existing portfolio to be significantly above the initial expectations. It's also important. Here we report the consolidated figures. Keep in mind that we also have Odal and Forte who is associated companies. In the bottom right, you see the proportionate figures. We will also report on the proportionate debt. All debt we secured more or less all last year on low interest rate, and we fixed them on typically 10-20 years. The larger project in Forte is secured on 15 years and Odal about 20 years. We have minimal interest or no interest risk on the existing portfolio. Obviously on new projects, we closely monitor construction costs and interest rates and take that into consideration when we do investment decisions on the projects. Yes. Very pleased. We're growing profitable. A good quarter for us. As planned, production is coming in. A lot more production is expected in the second half of the year. A combination of increased production, increased prices gives us favorable numbers. As Anders mentioned, consolidated number, proportionate figures, both steadily growing, production growing. We'll also obviously, the production segment is the main revenue driver, but we'll also now show value creation from the development segment and the operational segment. Going forward, we'll start reporting more detailed on all these three segments. To dive into the first segment, the production segment, you see the revenue picking up significantly from last year, five and seven times what we reported last year. Again, we go from 27 GWh to 74 GWh. This is spread out over the portfolio, and we saw some questions coming in that, yes, very large differences. It's been more volumes of snow in the northern part of Norway where the price has been low, slightly less in the south where the prices has been higher. We're very pleased with delivering 74 GWh, and especially now when Odal is picking up. The realized power price at NOK 101. Odal and Hån will produce into the southern areas, and these are large volumes that we expect to come in now in Q3, Q4. The higher prices are in the south. We still have some of our production in NO3, north of the Sognefjord, mid part of Norway, which is leveling out the higher prices in the areas. In the report, you will also see a more breakdown. We get a lot of questions about this, about the breakdown between the different price areas. You can read more carefully about that in the report. We want to emphasize that we have taken away the interest rate risk in 2021, and we continue the ramp-up of Odal and Forte. The development segment for us is, as Anders mentioned, early development in hydro, primarily in Norway. It's development of wind in central and south Sweden. We also now are starting the development in Norway, which has not been so active on the wind side over the last years. Here you see there's been no transactions in Q2. However, we have done a transaction now in Q3 based on third-party valuations. We see high degree of value creations for our in-house projects. NOK 8 million-NOK 10 million per megawatt hour, significantly higher than what we have said in the prospectus before about where we expected NOK 1 million-NOK 3 million per megawatt. Hån is very favorable project. Its execution cost of that project, we were able to secure turbines at relatively low levels. It's a good project with favorable wind conditions and the expected power is also going to the Oslo region, which looks favorable going forward. It's a combination of good execution and that the project is in the right area that gives us strong internal value creation for this project. We expect to see similar value creation for Munkhyttan and Kafjärden and so forth. Again, we're still in the procurement process of these companies. Also subsequently, we've agreed with Hafslund on selling 50% of Stenkalles Grund. For us, it's been very important to work with a local to have a local project working with a strong industrial owner who has experience and are also strong financially to back this project with us and do a joint venture. We're very pleased to work with Hafslund as a joint venture to optimize the total economics. We will still own 50%, so it's a very important project for us. Also, this is the start for our further development into the Baltic Sea. On the backlog side, we have taken out one wind project in Norway but also gotten two very attractive new hydro projects that we're developing. Over time, we will give you more transparency into these 15 projects, and we also have earlier reported Björnberget just on the southern area between Norway and Sweden of 100 MW, which is an important project for us in relatively midterm. Operational segments. Captiva, we own this 60%, so we report here on our consolidated figures, the 60% ownership. Starting to really get closely integrated in Cloudberry. Extremely happy with the competence they have both on hydro operations and construction within wind in Sweden. Really a good match for us to help us grow and also to have control since we plan to build three, four projects in parallel. Showing new contracts, the portal now have more than 500 hydro plants, big data from that benefits all small hydro owners here in the Nordics to see and improve on small scale hydro operations over time. We're also very pleased to see that they get new contracts on the financial side and also for the larger European players that's here in the Nordics that needs advice and services. Also the operational intelligence leg in Captiva is very strong. They now got a grant also with the top research institutes here in Norway, and then SINTEF to develop the operational intelligence for small and mid-scale hydro. Also on regulation technique, the Tide will do preventive work and secure higher uptimes and also we expect it to improve efficiency of these plants over time. Again, will benefit our portfolio, but hopefully also other third-party operators of hydro power in Europe. This will over time also be sold in Europe. I hope that gives a short summary before Anders dives into outlook and questions. Thank you. Yeah. Thank you, Christian. Moving on to the outlook, we have on the right hand side here mentioned some of the drivers. What we feel is that we have a very strong governmental support both in Europe, you see the EU having focus on speeding up the energy transition, speeding up the development of new renewable energy, REPowerEU with the go-to zones and so forth, with hopefully then also bring more projects to the market and more production to the market faster. The same we see in the Nordics. Both Sweden and the Norwegian governments are now focusing and prioritizing on getting more production, more renewable energy into the market. We see that we will have a higher demand in the Nordics. Historically, we have had very low power prices. As you can see here on the left side, we have an average of EUR 33 over the last 10 years. If you take a longer look at it's even lower. Historically, we have had low power prices in the Nordics. Going forward, we see that the third-party analysts here is our partner Volue's price estimate is much higher. Even though it comes down after a couple of years, according to this Volue outlook, we will still have a higher price level in the Nordics going forward. This curve shows the system price in Norway. But you will also see the same in the other Nordic countries and also if you have the outlook from other suppliers of the power price forecasts, they are more or less in the same area as what you see here. It could be that we are now facing a shift in the power prices and that we will have a much more higher power price in the Nordics going forward. This of course also has to do with the interconnectors out of Norway and Sweden and the capacity to export and also to import power from the continent. All in all, it's a very positive outlook for Cloudberry. We think what we see is that base load production is moving out, taking out of the market, Sweden with the, you know, phase out nuclear power over some time. That has to be compensated with a lot of new wind and other renewable sources. All in all, we believe in a higher price level going forward. That was on the positive side. We still feel that the commodity prices is an issue for us. Prices are rising on all type of commodities and as we've see also issues with the supply chain. We try to plan, be better at also planning, have some buffers between the different sections of a development project so we can have more flexibility. On the Hån project, for example, so far this has been working out very well. Now coming into the wind farm all the towers and nacelles and so on, we hope that this will also be in operation as planned. We can feel that there are issues on the supply chain side. The higher commodity prices is also levered with the higher power prices as we just showed. All in all, we have a positive view on the renewable sector and the renewable market in the Nordics. Thank you so much. That concludes our presentation. We are going to get Christian to join me here, and we are moving over to some of the questions that you have posted. I saw that several questions was concerning the portfolio, the production portfolio and the price areas, and how does this play out in the different price areas? What I can say is on the Cloudberry production, there is a lot of NO2 assets. When you look at the Forte portfolio, they have a lot of production in NO5. Also when it comes to our cooperation with Akershus Energi and KLP with the Odal, of course there is a lot of production in NO1. NO1, NO2, and NO5 are also the price areas we believe is going to be strongest over the next years in Norway. We think that then price areas three and four will pick up over time. We also have some producing assets in NO3 and NO4, but this summer we have stopped those assets because the power price have been too low. In the Swedish market, we have focused on SE three, and the next projects, all our next wind projects in Sweden will be in the SE3 area. We are also looking at project in SE4 and SE2. That is something that we are continuously looking at to build and get new project in these price areas. Yeah. Yeah. I see, Anders, we got a lot of questions and that's fantastic. Anders, you can maybe read. I can take some of the financial questions- Mm-hmm while you update on the incoming questions here. To take some of the financial ones, will the Hån transaction in Q3? The answer is yes, we will do that. That's a. We also got some other questions around that transaction. It's an internal transaction, but obviously based on conservative third party estimates. We will see significant value gains on the segment reporting in development segment. It said here NOK 160-NOK 200, and that seems to be fair estimates. We also had some questions on the balance sheet between the consolidated debt level and the proportionate debt level. Again, we prefer to show the proportionate because that also includes the debt, our portion of the debt in Forte and Odal. The figure of over 900 million of total debt in proportionate level includes our 100% owned, but also our proportionate share of the project-financed Odal and Forte. All these interests, as we mentioned, are on fixed and long-term rates. We also got a financial question about the non-strategic sale in Captiva. It was a 1 MW plant that was too small for us. We realized a gain of slightly over NOK 4 million on that based on the purchase price we had in January. That shows good value creation in a short amount of time for a non-strategic asset for us. Anders, feel free to jump in. Yeah. There are- I see it's a lot of questions here, and one concerning the offshore portfolio or several concerning the offshore portfolio, the shallow water projects. Yes, we are constantly working on the Stenkalles Grund project. Looking to take a FID during this year. We are now going into the next phase of that project, the procurement phase, and we are working on the different contracts on the marine side, on the foundations, on the turbine supply agreements and so forth. That is moving along very nicely. We are working very closely with our Dutch partners on that project. Now bringing also Hafslund into that project will be strengthening the team. That is moving along according to plan. At the same time, our team in Gothenburg is working on the Baltic projects. We will, during the next half year, inform the market of the next project. We work now with the local authorities, with the grid companies, to secure capacity and also to with all the local stakeholders. Making sure that this project has the ability to be delivered over the next couple of years. We are working on the other projects also in the Baltic Sea, but we are focusing now on Stenkalles in Vänern and then the first Baltic project that we will inform the market more about later this autumn. That was one of the questions. Yeah. Other questions? Yeah if you. No, no, I'll jump in there. It was a very good question about how prices. How does cash relate to production and power pricing? Can you say something about the split between variable and fixed cost of the production, power production? This is a little complicated answer. It's for us, as we mentioned, hydropower in Norway. We get the margin, as you see here, is about 67%, because we have a lot of hydro production now. There we have certain profit sharing agreements with the waterfall owners. When power prices are higher, you will also see higher operational expenses. The margins are, as you say, about 66% now. We expect on the wind side, when Odal and Hån comes in, that these margins are higher because there we have a fixed fee with the people owning the land of typically 4%. On hydro, it is on certain agreements, more variable. That's why you see a little higher OpEx because the people owning the water rights in Norway get paid well when the power prices are high. On the other side, we also have a defensive mechanism if the power price is low, that we pay very low for the water rights. This can obviously be explained in more detail, but shows a little bit of the dynamic in the portfolio. I can move on to answer one of the other questions concerning Hån. The question is, you know, how does this work when having a power project in Sweden and we are importing the power to Norway? That's a good question. I don't think there is a lot of those assets around, but we have an export license from the Swedish government and an import license from the Norwegian government. We own the cable. That's a separate company, but controlled by Cloudberry that own the cable from Sweden to Norway. The wind farm needs to be taxed according to the Swedish rules when it comes to wind farms. We will pay grid fees and et cetera when it comes to the export to Norway. It will be let's call it a hybrid Nordic project between Sweden and Norway, where we will sell the power into the Norwegian grid, and it's connected to the substation in Ørje on the border to Sweden on the Norwegian side. We are very, very happy with getting all these licenses in place. Yeah. We'll try to wrap this up, but maybe a last question, also about Kafjärden. We haven't written so much about it here, but it asked about the project. This is a project where it asks, "Can you reuse the foundations that's already in Kafjärden?" The answer is yes. That's what we're working on. And just in short, we bought this project for, depending on the last configuration of it, for about NOK 50 million if we get a larger case. It's already done about NOK 100 million of infrastructure investments in there. The plan is to reuse a lot of this and have turbines fit to these existing foundations. Hopefully we can update you on this in the coming quarters. It's so far so good. Okay. Should do a last question. Will the Norwegian politicians be successful implementing measures drawing down the Norwegian electricity prices? Well, we do see that the issue here is really that we will be having too little power available in 2025, 2026. We will have a deficit of power production. We really need to get up the production levels. Mm. That is really the problem. If we had more production, we could also probably drive down some of the prices. I'm sure that this is something that will be prioritized in Norway. We see the same in Sweden. They are prioritizing new renewable assets. We see the EU has these go-to zones where you have maximum one or two years before you get the license. We feel that it is a lot of. The resources is there. Just looking at the small hydropower around the river hydropower, you have a 15-16 TWh of a new project that doesn't have concessions per now. We have upgrade of large hydro, and you, of course, you have the wind power both offshore and onshore. I would think that the fastest way to more production is to do the onshore wind and the hydro projects in Norway and the onshore wind projects in Sweden. Yeah. Yeah. Last one, just again. Yeah There are a lot of questions about Hån and it's internal, so on consolidated level we won't report it, but it will be showing in the development segment in Q3. That's been for us a way to show that there is value creation in the development segment. I mean, these are again based on third-party reports. That's at least to show that a lot of good work is being done in the development segment. I agree. Yeah. Thank you so much for following us. Wish you all a nice day.