Slides
Page 1
MAY 28TH, 2025 INTERIM REPORT Q1 2025
Page 2
AGENDA • Floating Offshore Wind • Market Development Floating Offshore Wind • Global Market • Q1 Significant Events • Status project portfolio • Market update South Korea • Status TwinWindTM technology • Quarterly Deep-dive: Project divestment in Italy • Focus 2025 INTERIM REPORT JAN - MAR 2025 | Hexicon AB (publ)
Page 3
A development from onshore wind to offshore: - Land-based: 100+ countries - Offshore bottom fixed: 26 countries - Offshore floating: 7 countries With development and expansion comes cost reduction FLOATING OFFSHORE WIND BENEFITS OF FLOATING WIND • Stronger winds = more electricity • Flexible placement • Further from the coast • Less impact on animals and nature • Scalable First generation of wind power: Onshore Second generation of wind power: Offshore bottom-fixed Third generation of wind power: Offshore floating >1,000 GW installed globally 275,000+ turbines >83 GW installed globally ~13,000 turbines >245 MW ~50 turbines Source: GWECINTERIM REPORT JAN - MAR 2025 | Hexicon AB (publ)
Page 4
MARKET DEVELOPMENT FLOATING OFFSHORE WIND CURRENT STATE Market expectations Technology trigger 2010 2020 2030 2040 The culmination of exaggerated expectations Demo: Hywind 2,3MW First commercial park >250MW Many commercial wind farms Favorable market conditions: Low interest rates Hype around renewable energy Covid Delays in decision-making processes Rising interest rates The value of marine areas is drastically reduced Bottlenecks in the supply chain Time COMMERCIALISATION Actual market development Many projects under development Inflation Cost reductions in line with the maturity of the industry. Forecasts show a 50% decrease Hexicon’s IPO INTERIM REPORT JAN - MAR 2025 | Hexicon AB (publ)
Page 5
• Global market for offshore wind, both bottom-fixed and floating, has shown signs of recovery • 2024 was the first year that commercial-scale was auctioned – 1,900 MW in total • These projects are now approaching final investment decision (FID), signalling a transition from demo to industrial establishment • Crucial factors for continued progress include standardisation, streamlining of supply chains, and expansion of port and manufacturing infrastructure. • According to GWEC's market forecast for 2024, capacity is expected to increase to 8,500 MW by 2030 and further to 31,000 MW by 2033 • Expected to be installed from 2029 • Compound annual average growth rate (CAGR) of floating offshore wind power is estimated at 82 % in the period 2024-2028 and 54 % in the period 2029-2033 FLOATING OFFSHORE WIND GLOBAL MARKET New Floating Wind Installations Globally (MW) Sources: GWEC offshore wind report 2024Sources: Rystad Energy, GWEC Report 2024, DNV INTERIM REPORT JAN - MAR 2025 | Hexicon AB (publ) 48 72 122 491 835 947 1 996 3 800 6 920 7 550 8 300 2023 2024e 2025e 2026e 2027e 2028e 2029e 2030e 2031e 2032e 2033e
Page 6
• The transaction with Ingka Investments and Oxan Energy was closed on the 4th of April. JANUARY • Hexicon's Swedish joint venture, Freja Offshore, received a Natura 2000 permit from the County Administrative Board for the floating offshore wind farm Mareld, which is planned off the west coast of Sweden. MARCH • On March 26th, Hexicon signed a Sale and Purchase Agreement (SPA) with Ingka Investments, the investment arm of Ingka Group, the largest IKEA retailer, and Oxan Energy to sell its 50% stake in two Italian floating offshore wind projects, Sicily South and Sardinia Northwest. Q1 SIGNIFICANT EVENTS JANUARY FEBRUARY MARCH AFTER THE QUARTER APRIL MAY JUNE EVENTS DURING THE QUARTER INTERIM REPORT JAN- MAR 2025 | Hexicon AB (publ)
Page 7
PROJECT PORTFOLIO STATUS A diversified and world-class project portfolio • Active in 5 key markets • Diversified - countries, locations and stages • Decrease from Q1 2024 to Q1 2025 • Two Swedish project rejected • Decision to cancel Pohang 1 and 2 in South Korea • Q2 further decrease due to Italian divestment • 54% ownership in active projects 7 6 575 7 850 882 Total portfolio Q1 2025 Stages Gross MW Prospect Early Late 2 500 4 550 750 800 132 Active projects Q1 2025 Countries Gross MW Sweden Italy South Korea South Africa UK 6 575 4 475 8 900 5 300 8 732 3 492 14 600 6 800 15 307 7 967 23 500 12 100 0 5 000 10 000 15 000 20 000 25 000 Gross Net Gross Net Q1 2025 Q1 2024 Development of Project Portfolio Prospects MW Projects MW 15.3 GW 8.7 GW INTERIM REPORT JAN - MAR 2025 | Hexicon AB (publ)
Page 8
MARKET UPDATE SOUTH KOREA • One of the global leading countries in floating offshore wind – backed by a strong political support and subsidy system • First auction for floating offshore wind held in 2024 • The sudden imposition of martial law in late 2024 and subsequent impeachments created a climate of uncertainty affecting investor behaviour • The president Yoon Suk-Yeol was officially impeached in April 2025 OUTLOOK • Re-election will be held on the 3rd of June • The front-runner, currently leading the polls, Lee Jae-myung, Democratic Party, is pro-renewables. • After the election, investor appetite is expected to return to South Korea. MUNMUBARAM 750 MW • 100 % ownership • Electricity Business Licenses (EBLs) • EIA1) approved • TSA2) signed with KEPCO • Two of three EBLs transferred to Hexicon after approval from authorities in November 2024 • Application for third EBL to be evaluated 1) Environmental Impact Assessment 2) Transmission Service Agreement Read more: www.munmubaram.com INTERIM REPORT JAN - MAR 2025 | Hexicon AB (publ)
Page 9
• Important milestone reached in Q1 • A first set of load assessments completed • One of the first times a turbine OEM has conducted an evaluation for a floating foundation hosting two third-party turbines • Results showed promising load performance, without any significant risks identified • Results further support its development towards demonstration and commercialisation STATUS TWINWINDTM TECHNOLOGY INTERIM REPORT JAN - MAR 2025 | Hexicon AB (publ)
Page 10
PROJECT DIVESTMENT IN ITALY • 26th of March Hexicon made a divestment of two Italian projects in early phase with a total of 1,225 MW • Buyers were Ingka Investments and Oxan Energy • Purchase price EUR 2.5 million, plus payment at milestones of up to a total of EUR 20 million QUARTERLY DEEP-DIVE Year Project Capacity (MW) Transaction terms 2025 Sardinia NW, Sicily S, Italy 1,225 Up to 16,300 EUR/MW incl. milestone payments 2022 Geonggwang, South Korea 224 Up to 20,000 USD/MW incl. milestone payments 2021 Sounraey Tri, UK 90 11,000 GBP/MW, plus free carry of remaining 10% 2019 MunmuBaram, South Korea 900 8,500 USD/MW as free carry DIVESTMENT HISTORY INTERIM REPORT JAN - MAR 2025 | Hexicon AB (publ)
Page 11
FOCUS 2025 PROJECT DEVELOPMENT • Develop key projects through milestones • Divest selected projects • Continuous improvement of our project development process PORTFOLIO DEVELOPMENT Focus on core projects • Maintain and manage technical asset value • Establish route to market FINANCING INTERIM REPORT JAN - MAR 2025 | Hexicon AB (publ) TECHNOLOGY DEVELOPMENT Maintain technology value • Improve operational efficiency • Focus on divestment • Establish sufficient operational runway FINANCING Secure staying power
Page 12
www.hexicongroup.com HEAD OFFICE Östra järnvägsgatan 27 111 20 Stockholm, Sweden www.hexicongroup.com Thank you for listening!