Integrated Business Model

Innovative Technology Solutions for
Sustainability
ABENGOA
Integrated Business Model:
Our Basis for Sustainable Growth
Analyst & Investor Day
Manuel Sánchez
May 2012
Forward-looking statements
 This presentation contains forward-looking statements and information relating to Abengoa that are based on
the beliefs of its management as well as assumptions made and information currently available to Abengoa.
 Such statements reflect the current views of Abengoa with respect to future events and are subject to risks,
uncertainties and assumptions.
 Many factors could cause the actual results, performance or achievements of Abengoa to be materially different
from any future results, performance or achievements that may be expressed or implied by such forward-looking
statements, including, among others, changes in general economic, political, governmental and business
conditions globally and in the countries in which Abengoa does business, changes in interest rates, changes in
inflation rates, changes in prices, changes to national and international laws and policies that support renewable
energy sources; inability to improve competitiveness of our renewable energy services and products; decline in
public acceptance of renewable energy sources; legal challenges to regulations, subsidies and incentives that
support renewable energy sources; inability to obtain new sites and expand existing ones; changes in business
strategy and various other factors.
 Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those described herein as anticipated, believed, estimated, expected or
targeted.
 Abengoa does not intend, and does not assume any obligations, to update these forward-looking statements.
2
Agenda
1
Quick Glance to 2011
2
How did we do it? Abengoa’s Principles
3
What to expect in 2012
4
What’s next? 2013 and beyond
3
Review of 2011
2011, a truly challenging year
Global recession
Eurozone crisis
Liquidity restrictions
Budgetary restrictions
Arab Revolution
Decreased support to
renewable energy
4
Strategic Priorities 2011
In that economic environment our strategic priorities were very clear
Continue pursuing sustainable growth by global reach and diversification
Continue delivery on proven execution track record
Protect liquidity, ensuring our obligations are met
Improve shareholder returns
Leverage and expand existing visibility of earnings
Increase financial flexibility
5
2011 Key Financial Highlights
How did we do?
Revenues
EBITDA
7,089 M€
1,103 M€
 46% (4,860 M€ FY 2010)
2.7x (2,656 M€ FY 2007)
 36% (812 M€ FY 2010)
3.4x (323 M€ FY 2007)
Net Income
Corporate Net Debt to Corporate EBITDA
257 M€
2.1x
 24% (207 M€ FY 2010 figure)
2.1x (120 M€ FY 2007)
 from 3.8x at FY 2010
1. Delivery of good results, as anticipated
2. Significant improvement in balance sheet structure
6
Asset Investment Phase
During the asset investment phase we have significantly reduced
Abengoa’s risk profile
Asset Investment
2001
2010
Industrial Production
2020
Concession-type infrastructure
 «Internal» capex
 «External» capex
 100% promoter risk
 No promoter risk
 Growth in coporate debt
  non-recourse debt,  corporate debt
 Revenues exposed to market risk
 Secured revenues
 Investment in 1G and recycling capacity
completed
 Significant roll-out of projects in the next
18 months
7
Corporate Capex Evolution
Reduced corporate risk through a change of equity investment profile
towards concession-type assets ...
Equity investment: E&C, Industrial Production
647
2007
956
604
2008
2009
351
187
2010
2011
Equity investment: Concession-type Infrastructure capex
334
311
210
2007
2008
2009
466
2010
854
2011
Corporate Capex Split Evolution – Equity investment
E&C, Industrial Production
34%
66%
2007
34%
18%
66%
82%
2008
Concession-type infrastructure
57%
43%
2009
2010
82%
18%
2011
8
Net Debt Evolution
... financed with non-recourse debt at the project level
Corporate Net Debt (€M)
1,949
1,441
1,105
2007
2008
2009
2,276
1,486
2010
Non-recourse Net Debt (€M)
2011
3,981
Debt if «proportional consolidation»
1,078
1,369
2007
2008
Net Debt Split Evolution
2,920
2,166
2009
Corporate
2010
2,187
2011
Non-recourse
49%
49%
53%
56%
51%
51%
47%
44%
2007
2008
2009
2010
73%
27%
2011
9
Improved leverage profile
Understanding Abengoa’s leverage profile requires a closer look
What does a 5.0x Consolidated Net Debt / EBITDA mean?
2008
Corporate
3.9x
2011
2.1x
Non-recourse
8.0x
10.3x
Consolidated
5.2x
5.0x
 Reduced corporate
risk
 Higher ROE on
project
investment
10
Agenda
1
Looking Back to 2011
2
How did we do it? Abengoa’s Business Model
3
What to expect in 2012
4
What’s next? 2013 and beyond
11
Abengoa’s Principles
Abengoa’s success story is based on our integrated busniess model and
3 key principles
 Global reach

 Engine of growth
Industries
 Competitive advantage
Integrated
Business
Model
Discipline
Discipline
 Financial
 Management
12
Integrated Business Model
Integrated business model
The Abengoa Value Chain
Engineering
Procurement
E&C
Construction
Maintenance
Operation
Concession
and
Industrial
Production
Key Benefits
 Standardisation of activities through clearly
defined procedures
 In-house capabilities
–
Critical activities are executed by own
resources or through stable strategic
alliances
 Cross divisional learning benefits
 Improved visibility and growth profile vs.
pure players
Portfolio
Management
 Stronger financial profile and flexibility
Asset
Rotations
 Capital allocation managed to optimise
“global IRR” whilst protecting key
proprietary know-how
 Optimisation of maintenance activities
13
Integrated Business Model
Allows to take advantage of different market opportunities
Industrial
Production
Abengoa
Business
E&C
Sponsor
External
customer
Activity
EPC
EPC +
Operation
Sale of product
Project
Delivery
Regulation
Supply /
Demand
Equity
Source
none
EPC margin
ABENGOA
Debt
Guarantee
none
Project
ABENGOA
Risk
Concessions
External
customer
ABENGOA
14
Integrated Business Model
The concession model allows for superior returns and self-financing
Identification of
Opportunity
Start of
Construction
Development Phase
 Limited development
costs
Construction / Execution
Phase
 Equity contribution
< EPC mg
 N/R Project Finance
Asset
Rotation
Disciplined Asset Portfolio
Management

Opportunistic assets divestment 
to capture derisking arbitrage, 
crystallizing value uplift

Portfolio of Mature
Concessions
Managed to Maximise
Group Objectives
Dividend distribution
Natural deleverage
10-15% IRR to maturity
Start of
Operations


Concession
Ramp- up 
(2-4 years)
Asset ramp up
O&M
optimisation
Reduction asset
risk profile
Mature
concession
with clear Cash
Flow Profile
15
Geographic Diversification
A truly global business
World (M€)
Revenues FY 2001
1,380
Revenues FY 2011
Rest of Europe
7,089
15%
9%
Spain
US
1%
11%
Asia & Oceania
2%
Rest of Latin America
18%
27%
64%
19%
6%
Africa
1%
Brazil
6%
1%
21%
16
Industry Diversification
Well diversified platform provides a natural hedge to market cycles
EBITDA 2001: 157 M€
EBITDA 2011: 1,103 M€
33%
30%
4%
40%
66%
27%
Different industries – Different market and earnings drivers
E&C

Backlog and EPC margin

Internationalisation

Infrastructure
investment macro trends
Concession

Secured revenues/cash
flows

Average contract life of
25 years

EBITDA recurrence
Industrial Production

Revenue recurrence

Demand & pricing risk /
upside

Market cycle
17
R&D: the engine of growth
R&D is Abengoa’s engine of growth
Abengoa’s Strategy
R&D Project
R&D Program
18
Financial Discipline
Conservative approach to liquidity
Debt
 Corporate
 Non-recourse
+
Working
Capital
 N/R factoring
 Confirming
 Client
pre-payments
+
Cash
 Cash pooling
 Diversification
 Currency risk
management
Abengoa’s financial policy is focused on achieving maximum
flexibility and resilience for the company
19
Financial Discipline
Liquidity ensures we maximise our options
High Yield issuance – EU (B$)
14.9
20.8
27.4 30.7
30.7
6.5
3.0
Equity issuance – EU (B$)
80.2

Positive trend since mid 2010

Markets seemed to re-open in
H1 2011 ...

... but quickly closed again
44.1
19.0
39.0
20.7
13.1
Q3 Q4 Q1 Q2 Q3 Q4 Q1
2010 2010 2011 2011 2011 2011 2012
Q3 Q4 Q1 Q2 Q3 Q4 Q1
2010 2010 2011 2011 2011 2011 2012
In the current market conditions, the
benefits of our approach on liquidity
clearly outweight the financial cost
69.7

Meet debt maturities

Meet E&C payment obligations

Execute committed capex plan

Additional «room for
maneuver» for management
Building up a liquidity «life-line» takes much longer than capital markets to
reverse
20
Financial Discipline
Investment only after financial risk has been ringfenced at the project
level
ABENGOA
Equity
EPC
Margin
Abengoa Equity
Dividend
 Limited equity at risk:
Equity < EPC margin
Customer
Project NewCo
Debt
Debt
re-payment
Project Debt
 Limited responsibility to
project debt
Non-recourse debt
Banks
21
Management Discipline
Strict management procedures implemented accross the organisation
Strategic Planning & Control
Risk Management
 Strategic planning through
McKinsey’s «3 Horizons»
Put
Financial risk
Call
 Commodities
 10-year strategic plan
reformulated every 6 months
–
Hedging
 FX
 Interests
Review of KPIs
Credit risk
 Reporting & Control:
NOC
–
Monthly analysis and
review of results (KPIs)
–
SOX compliant
 Common management
procedures
 Non-recourse factoring
 Credit insurance
Operational risk
 At bidding
 At execution
Note: 2010 data
22
Agenda
1
Looking Back to 2011
2
How did we do it? Abengoa’s Principles
3
What to expect in 2012
4
What’s next? 2013 and beyond
23
Strategic Priorities 2012
Same financial environment, so same strategic priorities
Continue pursuing sustainable growth by global reach and diversification
Continue delivery on proven execution track record
Protect liquidity, ensuring our obligations are met
Improve shareholder returns
Leverage and expand existing visibility of earnings
Increase financial flexibility
24
2012 Guidance
Guidance for 2012
How will we get there?
Revenue
EBITDA
Corp.
EBITDA
Corporate
Leverage
7,550 – 7,750 M€
8%
1,275 - 1,325 M€
 E&C Backlog
18%
 Excellence in operating out
assets
780 – 800 M€
 Roll-out of concession plan
10%
<3.0x
 Extension of syndicated
loan
25
2012 Guidance Revenue Breakdown
M€
Total Revenues
E&C Evolution
7,650
3,526
1,683
7,089
4,100
2,302
3,085
2009
2010
2011
2012e
Concession-Type Infrastructure Evolution
4,860
465
3,444
1,542
219
308
427
2009
2010
2011
465
2012e
Industrial Production Evolution
3,136
2,250
427
308
219
3,526
1,683
2009
4,100
2,302
2010
2011
2012e
E&C
3,136 (2)%
1,542
2009
3,085
2,250
Concession-Type
Infrastructures
Industrial Production
2010
2011
2012e
26
High Revenue Visibility
Backlog (M€)
(1) Illustrative
Rest of 2012e
2013e
2014e+
7,078
3,141
2,727
1,210
32,541
33,620
Concession-type
Industrial Production
Asset based, recurring revenues
E&C Order Book
Mar. 2012
Estimated Conversion to Revenues
330
749
16,100
(1)
11,200
2,100
calculation according to estimated 12 months of revenues. 2014+e is calculated as 4 years of revenues.
2,800
27
High Revenue Visibility
Solid revenue visibility for E&C business
Year-end Backlog (M€)
Estimated Conversion to Revenues
2012E
7,535
Dec 2009
Dec 2010
Dec 2011
% sales
2013E
2014+E
93%
3,832
2,624
1,078
6,253
% sales
5,017
% sales
2011E
2012E
74%
59%
2,593
2,415
2010E
2011E
83%
58%
1,909
2,037
2013+E
1,245
2012+E
1,071
28
Working Capital Policy
E&C backlog provides 18-month revenue visibility and ability to generate
cash via working capital
Historical and Projected Working Capital Overview
Aggressive working capital policy:
12.7%
11.9%
Factoring
 n/r factoring with customers
8.7%
6.3%
 Removes credit risk
847
5.0%
Confirming
 Bank Payment to Suppliers
90 + 90 days
479
148
2007
321
206
2008
Change in WC (M€)
2009
2010
2011
Change in WC as % of Sales

Abengoa has consistently been able to
generate positive cash flows through
efficient management of working
capital
29
Debt Maturity Profile
Improved maturity profile and liquidity position at March 31, 2012
Pre-extension Maturity Profile (M€)
2,825
376
Cemig Cash Effect
Successful 1,566 M€ extension
1,640
2,449
1,282
650
466
556
Liquidity
94
Rest of 2012e
358
200
266
2013e
2014e
422
2015e
616
2016e
865
250
615
130
2017e
Subsequent
New Corporate Debt Maturity Profile (M€)
2,825
376
Cemig Cash Effect
1,258
2,449
904
907
438
200
266
485
94
273
358
Rest of 2012e
2013e
2014e
2015e
631
Liquidity
Syndicated Loans
Note: Maturities exclude revolving facilities
422
Convertible Bonds
642
865
250
616
615
130
2016e
2017e
Subsequent
Other Corp. Debt
30
Agenda
1
Looking Back to 2011
2
How did we do it? Abengoa’s Principles
3
What to expect in 2012
4
What’s next? 2013 and beyond
31
Supporting macro fundamentals
Population remains the key driver of energy demand
Projected Population
World
Europe
Brazil
USA
Rest of Latin America
Asia & Oceania
Africa
World
1,419m
2012
554m
199m
317m
273m
3,925m
1,041m
7,034m
2035
580m
219m
390m
340m
4,596m
1,501m
8,453m
Δ%
5%
10%
23%
25%
17%
44%
20%
Europe
US
26m
Asia & Oceania
73m
671m
Rest of Latin America
67m
460m
20m
Brazil
Africa
Projected population increase 2012-2035
Source: IHS Global Insight
32
Supporting macro fundamentals
Global GDP growth is likely to accelerate, driven by emerging
economies
Real GDP Growth Rate (%)
World
2012E Real GDP (2005 USD billions)
54,479
3.5%
Europe
US
15,436
2.2%
3.1%
Asia & Oceania
13,979
4.8%
Africa
4.3%
Brazil
Rest of Latin America
3.6%
Source: IHS Global Insight
1,285
5.1%
15,076
1,373
1,214
33
Supporting macro fundamentals
Strong increase of primary energy demand
Mtoe
18,000
Other NonOECD
16,000
Middle East
14,000
India
12,000
China
10,000
Other OECD
8,000
6,000
Europe
4,000
United States
2,000
0
1980
2000
2009
2015
2020
2030
2035
Source: WEO2011
34
Supportive Outlook - Transmission
T&D investment driven by new generation capacity additions and population
growth
Latin America
 Strong economic growth
 Under developed infrastructure
Asia
 Growing population
–
Consequent increase in the
demand of energy
–
Huge potential market
10-yr Energy infrastructure plan
 48 GW new generation capacity
by 2019
 37,000 km new lines 2009-19
 43.0 B BRL planned investment
Investment estimates:
Electricity Investment plan
 5 GW new generation capacity by
2017
 >2,000 Km new lines 2012-17
 ~100 B$ until 2020
Middle East
 670 M$ planned investment
8 Tenders
 ~30 B$ until 2020
 8 BOT concessions between 2011
and 2012
 850 M$ investment
35
Supportive Outlook - CSP
CSP will become a relevant technology in the global energy mix
World Energy Outlook estimates for 2035
 Global capacity additions: 81 GW
15
 Committment to Renewable Energy
Directive targets
15
11
11
3
EuropeMiddle East USA
Africa
CSP targets in most of the relevant regions
LatAm
 Global investment: $285 B (2010 prices)
 Nuclear «shutdown» promoting initiatives
such as Desertec (first 22GW agreed by
Algeria by 2030)
 $9 billion solar program, launched in 2009
for a total capacity of 2 GW between
2015-2020
 South Africa´s 2030 CSP target is 1GW out
of the country´s target of 10,000 GWh from
renewable energies
 Australia´s CSP target: 1GW by 2020
65
46
45
 Saudi Arabia has a target of 15% from solar
energy by 2020
34
10
EuropeMiddle East USA
Africa
LatAm
 Abu Dhabi has set a renewable target of
7% for 2020. The Masdar project, for the
deployment of RE, accounts for 750 M$
36
Supportive Outlook - Recycling
Increased industrial activity and tougher regulation on waste disposal
Stable growth expected in European steel
production (Mt)
EAF
250
Stringent environmental regulation will
increase demand for recycling capacity
 2th largest EAF market, 500 –
600k tons steel dust per year
Crude Steel
200
 Regulation converging to EU
standards
150
100
 Abengoa already present
50
0
 3rd largest EAF market, ~400k
tons steel dust per year
CAGR 2011-2015e: 6.7%
CAGR 2011-2015e: 6.5%
 Increasingly strict
environmental regulation
 High landfill cost

Zinc consumption is expected to increase
by 3.8% between in the next 2 years .

Other large EAF markets with growing
environmental regulation include
Thailand, Brazil, Taiwan and Saudi Arabia
37
Supportive Outlook - Water
Governments promoting investment in water infrastructure.
Desalination capacity expected to double in the next 5 years

1/3 of the
population lacks
access to
sufficient safe
water for basic
needs

Desalination
capacity of 10
million m3/day
by 2016
Water Deficient Regions
Population with No Access
to an Improved Water Source
Population with No Access
to Improved Sanitation
Countries facing Water Stress
Countries facing Water Scarcity
Water Desalination Investment 2012-2016
8.1
Global investment of 74 B$
9.0
5.8
Saudi
Arabia
USA
UAE
5.0
3.7
Australia Kuwait
2.8
Israel
3.5
Libya
2.1
1.7
1.9
Spain
Algeria
India
1.0
0.8
Oman
Qatar
38
Supportive Outlook - Biofuels
Compliance with renewable energy committments and increase in
transport fuel will drive industry in the mid and long term
Penetration of biofuels in the 3 key markets
3%
Share of fuel
(% of energy use)
39%
7%
21%
Renewables
15%
4%
2010
2010
2030
7%
2030
15%
1990
2030
0,4%
6%
Nuclear
5%
6%
Hydro
6%
7%
Coal
27%
28%
Natural gas
22%
26%
Oil
39%
27%
4%
2010
2030
Drivers for the key biofuels markets
US
Brazil
 E15 roll-out
 Price-driven market
 RPF: 36 BGY in 2022
 Energy security
 Energy security
Europe
 RED : 10% renewable
energy in transportation
by 2020
 Sustainability
39
A Success Story
Finalising asset investment, on track to continue to the phase of
sustainable growth
E&C
know-how
Asset investment
2001
Sustainable growth
2014
7.089 M€
1,800 M€ EBITDA 2015
1.380 M€
1.103 M€
Revenue
EBITDA
> 15% Dividend payout
166 M€
<3.0x Corporate
 Solid E&C
company
 Limited R&D
investment
 No
recurrent
revenues
 Strong R&D committment
 Capex >>> EBITDA
leverage
Maximise N/R debt
 Increase total debt
 Limited dividend
40
Innovative Technology Solutions for
Sustainability
ABENGOA
Thank you!
Analyst & Investor Day
May 2012