EX-99.2 3 exhibit_99-2.htm EXHIBIT 99.2

Exhibit 99.2
 
Financial Information for the Three Months and Six Months Ended June 30, 2019 of Kenon and OPC and
 Reconciliation of Certain non-IFRS Financial Information

Table of Contents






Appendix A
 
Summary Kenon consolidated financial information
 
Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Financial Position as of June 30, 2019 and December 31, 2018

   
As of
June 30,
    
As of
December 31,
  
   
2019
    
2018
  
   
(Unaudited)
        
   
$ millions
  
Current assets
            
Cash and cash equivalents
    
138
      
131
  
Short-term investments and deposits
    
78
      
50
  
Trade receivables, net
    
32
      
36
  
Other current assets, including derivatives
    
46
      
41
  
Asset held for sale
    
70
      
70
  
Total current assets
    
364
      
328
  
Non-current assets
                
Investments in associated companies
    
144
      
161
  
Deposits, loans and other receivables, including derivative instruments
    
153
      
140
  
Deferred payment receivable
    
197
      
189
  
Deferred taxes, net
    
1
      
1
  
Property, plant and equipment, net (including right-of-use asset)
    
670
      
635
  
Intangible assets, net
    
1
      
1
  
Total non-current assets
    
1166
      
1,127
  
Total assets
    
1,530
      
1,455
  
Current liabilities
                
Loans and debentures
    
36
      
23
  
Trade payables
    
61
      
48
  
Other payables, including derivative instruments and liabilities in respect of leases
    
15
      
12
  
Income tax payable
    
1
      
7
  
Total current liabilities
    
113
      
90
  
Non-current liabilities
                
Loans, excluding current portion
    
507
      
488
  
Debentures, excluding current portion
    
75
      
75
  
Deferred taxes, net
    
68
      
59
  
Income tax payable
    
28
      
27
  
Other non-current liabilities
    
6
      
-
  
Total non-current liabilities
    
684
      
649
  
Total liabilities
    
797
      
739
  
Equity
                
Share capital
    
602
      
602
  
Translation reserve
    
7
      
1
  
Capital reserve
    
16
      
17
  
Accumulated profit
    
26
      
29
  
Equity attributable to owners of the Company
    
651
      
649
  
Non-controlling interests
    
82
      
67
  
Total equity
    
733
      
716
  
Total liabilities and equity
    
1,530
      
1,455
  
 
 Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Profit & Loss

   
For the six months ended
June 30,
    
For the three months ended
June 30,
  
   
2019
    
2018
    
2019
    
2018
  
   
$ millions
    
$ millions
  
Revenue
    
182
      
185
      
85
      
84
  
Cost of sales and services (excluding depreciation)
    
(126
)
    
(127
)
    
(64
)
    
(63
)
Depreciation
    
(15
)
    
(15
)
    
(8
)
    
(8
)
Gross profit
    
41
      
43
      
13
      
13
  
Selling, general and administrative expenses
    
(18
)
    
(11
)
    
(8
)
    
(5
)
Other income
    
1
      
-
      
1
      
-
  
Financing expenses
    
(16
)
    
(17
)
    
(10
)
    
(11
)
Financing income
    
9
      
12
      
5
      
10
  
Financing expenses, net
    
(7
)
    
(5
)
    
(5
)
    
(1
)
Gain on third party investment in Qoros
    
-
      
504
      
-
      
-
  
Fair value loss on put option
    
(8
)
    
(13
)
    
(3
)
    
(13
)
Write back of financial guarantee
    
-
      
63
      
-
      
-
  
Share in losses of associated companies, net of tax
    
(16
)
    
(50
)
    
(3
)
    
(22
)
(Loss)/profit before income taxes
    
(7
)
    
531
      
(5
)
    
(28
)
Income taxes
    
(7
)
    
(7
)
    
(2
)
    
(1
)
(Loss)/profit for the period from continuing operations
    
(14
)
    
524
      
(7
)
    
(29
)
Loss for the period from discontinued operations (after tax)
    
(1
)
    
-
      
(1
)
    
-
  
(Loss)/profit for the period
    
(15
)
    
524
      
(8
)
    
(29
)
Attributable to:
                                
Kenon's shareholders
    
(20
)
    
517
      
(8
)
    
(29
)
Non-controlling interests
    
5
      
7
      
-
      
-
  
(Loss)/profit for the period
    
(15
)
    
524
      
(8
)
    
(29
)
Basic/diluted (loss)/profit per share attributable to Kenon's shareholders (in dollars):
                                
Basic/diluted (loss)/profit per share
    
(0.37
)
    
9.60
      
(0.13
)
    
(0.53
)
Basic/diluted (loss)/profit per share from continuing operations
    
(0.35
)
    
9.60
      
(0.12
)
    
(0.53
)
Basic/diluted loss per share from discontinued operations
    
(0.02
)
    
-
      
(0.01
)
    
-
  


Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Cash Flows
For the six months ended June 30, 2019 and 2018
 
 
For the six months
ended June 30,
 
  
2019
    
2018
  
 
  
$ millions
  
Cash flows from operating activities
            
(Loss) / profit for the period
    
(15
)
    
524
  
Adjustments:
                
Depreciation and amortization
    
15
      
15
  
Financing expenses, net
    
7
      
5
  
Share in losses of associated companies, net of tax
    
16
      
50
  
Write back of financial guarantee
    
-
      
(63
)
Gain on third party investment in Qoros
    
-
      
(504
)
Fair value loss on put option
    
8
      
13
  
Write back of other payables
    
-
      
(3
)
Share-based payments
    
1
      
1
  
Income taxes
    
8
      
7
  
 
    
40
      
45
  
Change in trade and other receivables
    
12
      
17
  
Change in trade and other payables
    
10
      
(14
)
     
62
      
48
  
Income taxes paid, net
    
(7
)
    
(169
)
Net cash provided by / (used in) operating activities
    
55
      
(121
)

 
 
Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Cash Flows, continued
For the six months ended June 30, 2019 and 2018
 
 
  
For the six months
ended June 30,
  
 
  
2019
    
2018
  
 
  
$ millions
  
Cash flows from investing activities
            
Short-term deposits and loans, net
    
(26
)
    
-
  
(Payment for)/proceeds from long-term deposits, net
    
(14
)
    
3
  
Cash paid for businesses purchased, less cash acquired
    
-
      
(2
)
Acquisition of property, plant and equipment
    
(19
)
    
(33
)
Interest received
    
-
      
2
  
Proceeds from dilution of third party investment in Qoros
    
-
      
260
  
Receipt to release financial guarantee
    
-
      
18
  
Payment of transaction cost for sale of subsidiaries
    
-
      
(49
)
Sale of subsidiary, net of cash disposed off
    
1
      
-
  
Net cash (used in) / provided by investing activities
    
(58
)
    
199
  
 
                
Cash flows from financing activities
                
Dividend paid to non-controlling interests in a subsidiary
    
(7
)
    
(6
)
Capital distribution
    
-
      
(665
)
Receipt of long-term loans and issuance of debentures
    
-
      
3
  
Repayment of long-term loans and debentures
    
(8
)
    
(101
)
Repayment of short-term credit from banks and others, net
    
(2
)
    
(276
)
Proceeds from issue of share capital by a subsidiary to non-controlling interests
    
33
      
-
  
Interest paid
    
(11
)
    
(14
)
Net cash provided by / (used in) financing activities
    
5
      
(1,059
)
 
                
Increase / (decrease) in cash and cash equivalents
    
2
      
(981
)
Cash and cash equivalents at beginning of the period
    
131
      
1,417
  
Effect of exchange rate fluctuations on balances of cash and cash equivalents
    
5
      
(7
)
Cash and cash equivalents at end of the period
    
138
      
429
  
 

Information regarding reportable segments

The following table sets forth selected financial data for Kenon’s reportable segments for the periods presented:
 
 
  
For the six months ended June 30, 2019
  
   
OPC
    
Quantum1
    
Other2
    
Consolidated Results
  
Revenue          
    
182
      
-
      
-
      
182
  
Depreciation and amortization
    
(15
)
    
-
      
-
      
(15
)
Financing income          
    
-
      
-
      
9
      
9
  
Financing expenses          
    
(15
)
    
-
      
(1
)
    
(16
)
Fair value loss on put option
   
-
      
(8
)
    
-
      
(8
)
Share in losses of associated companies
    
-
      
(9
)
    
(7
)
    
(16
)
Profit / (Loss) before taxes
    
19
      
(17
)
    
(9
)
    
(7
)
Income taxes          
    
(5
)
    
-
      
(2
)
    
(7
)
Profit / (Loss) from continuing operations
    
14
      
(17
)
    
(11
)
    
(14
)
____________________________________
(1)
Quantum is a wholly-owned subsidiary of Kenon which holds Kenon's interest in Qoros.
(2)
Includes the results of Primus; the results of ZIM, as an associated company; as well as Kenon’s and IC Green’s holding company and general and administrative expenses.

 
  
For the six months ended June 30, 2018
  
   
OPC
    
Quantum1
    
Other2
    
Adjustments3
    
Consolidated Results
  
   
$ millions
  
Revenue          
    
185
      
--
      
-
      
-
      
185
  
Depreciation and amortization
    
(15
)
    
-
      
-
      
-
      
(15
)
Fair value loss on put option
    
-
      
(13
)
    
-
      
-
      
(13
)
Financing income          
    
1
      
1
      
39
      
(29
)
    
12
  
Financing expenses          
    
(15
)
    
(2
)
    
(29
)
    
29
      
(17
)
Write back of financial guarantee
    
-
      
63
      
-
      
-
      
63
  
Gain on third party investment in Qoros
    
-
      
504
      
-
      
-
      
504
  
Share in losses of associated companies
    
-
      
(28
)
    
(22
)
    
--
      
(50
)
Profit / (Loss) before taxes
    
22
      
526
      
(17
)
    
-
      
531
  
Income taxes          
    
(6
)
    
-
      
(1
)
    
-
      
(7
)
Profit / (Loss) from continuing operations
    
16
      
526
      
(18
)
    
-
      
524
  
____________________________________
(1)
Quantum is a wholly-owned subsidiary of Kenon which holds Kenon's interest in Qoros.
(2)
Includes the results of Primus; the results of ZIM, as an associated company; as well as Kenon’s and IC Green’s holding company and general and administrative expenses.
(3)
“Adjustments” includes inter-segment financing income and expenses.





 
  
For the three months ended June 30, 2019
  
   
OPC
    
Quantum1
    
Other2
    
Consolidated Results
  
     
$ millions
  
Revenue          
    
85
      
-
      
-
      
85
  
Depreciation and amortization
    
(8
)
    
-
      
-
      
(8
)
Financing income          
    
-
      
-
      
5
      
5
  
Financing expenses          
    
(10
)
    
-
      
-
      
(10
)
Fair value loss on put option ……
    
-
      
(3
)
    
-
      
(3
)
Share in (losses) / profits of associated companies
    
-
      
(3
)
    
1
      
(2
)
(Loss) / Profit before taxes
    
-
      
(6
)
    
1
      
(5
)
Income taxes          
    
-
      
-
      
(2
)
    
(2
)
Loss from continuing operations
    
-
      
(6
)
    
(1
)
    
(7
)
____________________________________
(1)
Quantum is a wholly-owned subsidiary of Kenon which holds Kenon's interest in Qoros.
(2)
Includes the results of Primus; the results of ZIM, as an associated company; as well as Kenon’s and IC Green’s holding company and general and administrative expenses.

 
  
For the three months ended June 30, 2018
  
   
OPC
    
Quantum1
    
Other2
    
Adjustments3
    
Consolidated Results
  
   
$ millions
  
Revenue          
    
84
      
-
      
-
      
-
      
84
  
Depreciation and amortization
    
(8
)
    
-
      
-
      
-
      
(8
)
Financing income          
    
1
      
1
      
21
      
(13
)
    
10
  
Financing expenses          
    
(10
)
    
(1
)
    
(13
)
    
13
      
(11
)
Fair value loss on put option……
    
-
      
(13
)
    
-
      
-
      
(13
)
Share in losses of associated companies
    
-
      
(13
)
    
(9
)
    
-
      
(22
)
Profit / (Loss) before taxes
    
1
      
(26
)
    
(3
)
    
-
      
(28
)
Income taxes          
    
(1
)
    
-
      
-
      
-
      
(1
)
Loss from continuing operations
    
-
      
(26
)
    
(3
)
    
-
      
(29
)
____________________________________
 
(1) Quantum is a wholly-owned subsidiary of Kenon which holds Kenon's interest in Qoros.
(2)
Includes the results of Primus; the results of ZIM, as an associated company; as well as Kenon’s and IC Green’s holding company and general and administrative expenses.
(3)
“Adjustments” includes inter-segment financing income and expenses.
 
         
 Information regarding associated companies

 
  
Asset held
for sale
    
Carrying amounts of investment
in associated companies
    
Equity in the net (losses) / earnings
of associated companies
  


as at


as at

For the sixmonths ended

For the three months ended
 
  
June 30,
2019
    
December 31,
2018
    
June 30,
2019
    
December 31,
2018
    
June 30,
2019
    
June 30,
2018
    
June 30,
2019
    
June 30,
2018
  
 
  
$ millions
    
$ millions
    
$ millions
    
$ millions
  
ZIM
    
-
      
-
      
83
      
91
      
(7
)
    
(22
)
    
1
      
(9
)
Qoros
    
70
      
70
      
61
      
70
      
(9
)
    
(28
)
    
(4
)
    
(13
)
 
                                                                
 
    
70
      
70
      
144
      
161
      
(16
)
    
(50
)
    
(3
)
    
(22
)
 
Appendix B

Summary OPC consolidated financial information1

OPC’s Consolidated Statement of Profit

 
  
For the six months ended
June 30,
    
For the three months ended
June 30,
  
 
  
2019
     2018    
2019
     2018  
 
  
$ millions
    
$ millions
  
Sales
    
182
      
185
      
85
      
84
  
Cost of sales (excluding depreciation and amortization)
    
(126
)
    
(127
)
    
(64
)
    
(63
)
Depreciation and amortization
    
(15
)
    
(15
)
    
(8
)
    
(8
)
Gross profit
    
41
      
43
      
13
      
13
  
General, selling and administrative expenses
    
(8
)
    
(7
)
    
(4
)
    
(3
)
Other income
    
1
      
-
      
1
      
-
  
Financing expenses, net
    
(15
)
    
(14
)
    
(10
)
    
(9
)
Profit before taxes
    
19
      
22
      
-
      
1
  
Taxes on income
    
(5
)
    
(6
)
    
-
      
(1
)
Net profit for the period
    
14
      
16
      
-
      
-
  
Attributable to:
                                
Equity holders of the company
    
11
      
12
      
-
      
-
  
Non-controlling interest
    
3
      
4
      
-
      
-
  
Net profit for the period
    
14
      
16
      
-
      
-
  

 (1)
Translations of NIS amounts into US Dollars use a rate of 3.62: 1 for 2019 and 3.59: 1 for 2018.

Summary Data from OPC’s Consolidated Statement of Cash Flows

 

  
For the six months ended
June 30,
    
For the three months ended
June 30,
  
 
  
2019
    
2018
    
2019
    
2018
  
 
  
$ millions
    
$ millions
  
Cash flows provided by operating activities
    
73
      
66
      
21
      
39
  
Cash flows used in investing activities
    
(58
)
    
(39
)
    
(46
)
    
(17
)
Cash flows used in / (provided by) financing activities
    
(1
)
    
(33
)
    
7
      
(28
)
Increase / (decrease) in cash and cash equivalents
    
14
      
(6
)
    
(18
)
    
(6
)
Cash and cash equivalents at end of the period
    
106
      
133
      
106
      
133
  
Investments in property, plant and equipment
    
(18
)
    
(29
)
    
(10
)
    
(14
)
Total depreciation and amortization
    
15
      
15
      
8
      
8
  

Summary Data from OPC’s Consolidated Statement of Financial Position
 
 
  
As of
  
 
  
June 30,
2019
    
December 31,
2018
  
 
  
$ millions
  
Total financial liabilities1
    
618
      
586
  
Total monetary assets2
    
250
      
187
  
Total equity attributable to the owners
    
221
      
181
  
Total assets
    
1,008
      
905
  
 
1.
Including loans from banks and others and debentures
2.
Including cash and cash equivalents, short-term deposits and restricted cash.
 
 
Appendix C
 
Definition of OPC’s EBITDA and non-IFRS reconciliation
 
This press release, including the financial tables, presents EBITDA, which is considered to be a “non-IFRS financial measure.”
 
OPC defines “EBITDA” as for each period as net profit before depreciation and amortization, financing expenses, net, and income tax expense. EBITDA is not recognized under IFRS or any other generally accepted accounting principles as a measure of financial performance and should not be considered as a substitute for net profit or loss, cash flow from operations or other measures of operating performance determined in accordance with IFRS. EBITDA is not intended to represent funds available for dividends or other discretionary uses because those funds may be required for debt service, capital expenditures, working capital and other commitments and contingencies. There are limitations that impair the use of EBITDA as a measure of OPC's profitability since it does not take into consideration certain costs and expenses that result from OPC's business that could have a significant effect on net profit, such as financial expenses, taxes, depreciation, capital expenses and other related items.
 
OPC believes that the disclosure of EBITDA provides transparent and useful information to investors and financial analysts in their review of the company’s, or its subsidiaries’ operating performance and in the comparison of such operating performance to the operating performance of other companies in the same industry or in other industries that have different capital structures, debt levels and/or income tax rates.
 
Set forth below is a reconciliation of OPC’s net profit to EBITDA for the periods presented. Other companies may calculate EBITDA differently, and therefore this presentation of EBITDA may not be comparable to other similarly titled measures used by other companies.

   
For the six months
ended June 30,
  
 
  
2019
    
2018
  
 
  
$ millions
  
Net profit for the period
    
14
      
16
  
Depreciation and amortization
    
15
      
15
  
Financing expenses, net
    
15
      
14
  
Income tax expense
    
5
      
6
  
EBITDA
    
49
      
51
  

   
For the three months
ended June 30,
  
 
  
2019
    
2018
  
 
  
$ millions
  
Net profit for the period
    
-
      
-
  
Depreciation and amortization
    
8
      
8
  
Financing expenses, net
    
10
      
9
  
Income tax expense
    
-
      
1
  
EBITDA
    
18
      
18
  


Appendix D
 
Summary Financial Information of OPC’s Subsidiaries
 
The tables below set forth debt, cash and cash equivalents, deposits and restricted cash for OPC’s subsidiaries as of June 30, 2019:

 
 
OPC-Rotem
 
 
OPC-Hadera
 
 
Tzomet
 
 
Others
 
 
Total OPC
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt (excluding accrued interest)
 
 
352
      
186
      
-
      
80
      
618
 
Cash and cash equivalents and short term deposits
 
 
40
      
10
      
1
      
111
      
162
 
Restricted cash (including debt service reserves)
 
 
59
      
2
      
1
      
26
      
88
 
Debt service reserves
 
 
37
      
-
      
-
      
15
      
52
 
 
The tables below set forth debt, cash and cash equivalents, deposits and restricted cash for OPC’s subsidiaries as of December 31, 2018: 
 
 
 
  
OPC-Rotem
    
OPC-Hadera
     Others     Total OPC  
 
                        
Debt (excluding accrued interest)
    
336
      
172
      
78
      
586
  
Cash and cash equivalents and short term deposits
    
26
      
12
      
77
      
115
  
Restricted cash (including debt service reserves)
    
46
      
2
      
24
      
72
  
Debt service reserves
    
24
      
-
      
13
      
37
  
 
Appendix E
 
Summary Operational Information of OPC
 
The tables below set forth details of sales, generation and purchases of electricity by OPC and availability and net generation of OPC split by the Rotem plant and the Hadera energy center (kWh in millions):

 
  
For the six months ended
June 30,
    
For the three months ended
June 30,
  
 
  
2019
     2018    
2019
     2018
 
Sales to private customers
    
1,991
      
1,973
      
1,022
      
1,000
  
Sales to the system administrator
    
48
      
47
      
5
      
9
  
Total sales
    
2,039
      
2,020
      
1,027
      
1,009
  

 
 
  
For the six months ended
June 30,
    
For the three months ended
June 30,
  
 
  
2019
    
2018
     2019    
2018
  
Net generation of electricity
    
1,932
      
1,930
      
948
      
954
  
Purchase of electricity from the system administrator
    
107
      
90
      
79
      
55
  
Total volume of electricity generated and purchases from the system administrator
    
2,039
      
2,020
      
1,027
      
1,009
  

 
  
For the six months ended June 30,
  
 
  
2019
    
2018
  
 
  
Availability
(%)
    
Net generation
(kWh in millions)
    
Availability
(%)
    
Net generation
(kWh in millions)
  
OPC-Rotem
    
100
%
    
1,890
      
100
%
    
1,888
  
OPC-Hadera
    
92
%
    
42
      
94
%
    
42
  

 
  
For the three months ended June 30,
  
 
  
2019
    
2018
  
 
  
Availability
(%)
    
Net generation
(kWh in millions)
    
Availability
(%)
    
Net generation
(kWh in millions)
  
OPC-Rotem
    
99
%
    
929
      
100
%
    
936
  
OPC-Hadera
    
92
%
    
19
      
93
%
    
18