Rubis (RUI) Earnings Call Transcript & Summary

Good evening, everybody. Welcome to today's presentation of the results for the first half of 2023 of the Rubis Group. By way of an introduction. I will make some broad remarks on our positioning on the different markets as well as a more specific insight into how we allocate cash flow within the group. And then I will hand over to Clarisse, who will go into more detail on our businesses and on the results of the group for the first half. We have Robin Ucelli with us, who is the CEO of Photosol and one of the 2 Co-founders, with [ David Guinard ], who will go into more detail on the business of the subsidiary that he runs. Next, Bruno will go into greater detail on the group financial statements. And we will then move on to questions and answers, after; and conclusion, some concluding remarks from Clarisse. So first of all, a reminder about the group's current structure after some sweeping changes made last year. We have 3 businesses, which are all parts of the "distribution and storage of energy" business. We have a traditional activity which has been the backbone of Rubis for some time. This is the Energy Distribution business. Part of -- we have a Retail & Marketing business. And then we have the upstream business which is supporting services and infrastructure services and third-party services. The group has a presence in over 40 countries across 3 continents, Africa; America and specifically the Caribbean region; and of course, Europe. In these continents, we have many products. We promote LPG, which is a low-carbon-intensive solution. We also distribute fuel, various types of fuel, across a network of petrol stations. We have a major subsidiary in Africa which specializes in the distribution of bitumen. And the middle section shows energy -- renewable electricity. We have Photosol, which is a major platform, a French and soon to be a European production platform for photovoltaic energy; and a stake in HDF Energy which gives access to photovoltaic solutions as well as the storage of hydrogen in the Caribbean region. At present, we have approximately 400 megawatts of installed capacity, a pipeline of 3.8 giga. And as I was saying earlier, we have strong activity in France, which is the core market of Photosol, but with inroads in the process of being made this year into Italy, Spain and Poland. And we will be going back on that, of course. Now most of the assets and the EBITDA, as you can see at the bottom of the slide, are due to the long-standing businesses of the group. And the renewables section is an activity which is expanding strongly and is reflected in the EBITDA and the assets. Thirdly, and this is accounted for under the equity method, we have a 55% stake in [ the terminal ] which specializes in the storage of liquid products, namely chemical products, biofuels, agri fuel products and oil products. Here's a view of our markets. We wanted to look at the various markets in which we're having activity, especially the fundamentals, the growth to be expected in terms of volume on these various markets. The benefit for the group is the portfolio effect which enables us to have a business across 40 countries on 3 continents, many markets with different structures, segments that are also very diverse and a very diverse client base, which enables us to be very resilient in terms of growth for the group. In Africa, we're very good, very strong on LPG. This is a transition energy. And of course, it is in Europe as well, but there's an additional benefit in Africa, which is that it's a substitute for paraffin or coal. And this is a significant improvement for users in their day-to-day uses. We also have a network of petrol stations, with a presence in all categories of fuels and lubricants. This is -- and supported through, accompanied by the development of mobility and with the emergence of a middle class. And as I was saying earlier, we have a presence in bitumen. And the needs and infrastructure requirements in Africa are very significant. So this provides growth of [ 3.5% ] growth for fuel and approximately 10% -- 5% to 10% for bitumen. In the Caribbean, we have a presence in the LPG market with a growth of approximately 3%, and in fuel with growth between 2% to 3% per year. We have some very active regions and areas in this part of the world, namely Guiana. Suriname is another country where we are investing. And this region enjoys the proximity and the wealth of the United States, Canada; and increasingly countries such as Brazil, through tourism and various services and in particular financial services. Now finally, Europe. The LPG market is a market which is posting moderate -- a moderate decline in growth, but it's very strong in terms of cash flow generation and profitability. And of course, depending on the -- with a view to the investments we made last year in renewable electricity, we have invested more heavily in green energy in Europe than in [ fossil fuel ] energies. And through renewable energies, we have access to growth markets with growth to the tune of 15% to 20% per year. So the fundamentals that underpin all this and which account for the very strong resilience of the group to all the external shocks is that we are targeting the basic requirements of different categories of the population. And in many regions, these population categories are seeing higher spending power and with the emergence of the middle class. So this -- we also wanted to give you some new information. This is the annual cash flow allocation for the group. So this -- you read this from left to right. So what you have -- and you have EUR 450 million cash flow overall which is generated. With to -- moving to the Second column from the left, the first main use of the cash flow that we fully intend to maintain is that of dividend payment. The group has -- over the past 25 years and even beyond that, has always paid out a dividend and has always increased the dividend payout, so we have no intention of breaking with -- that tradition. And this is something that's quite rare. So the first use of the cash flow is for dividend payments. The next, we have investment and maintenance CapEx, of which is -- for Rubis Énergie. That's EUR 150 million. That leaves us with EUR 100 million of cash available for growth CapEx, so this brings us to the column in the middle, third from the left. This is adjusted yearly, but let's just take and break the EUR 100 million down into EUR 40 million and EUR 60 million. EUR 40 million is the cash flow which is available for the growth CapEx for Rubis Énergie. The leverage for the business is approximately 50%. And on a full year basis, this gives us access to investments of approximately EUR 80 million. The remaining EUR 60 million of cash flow are allocated to green power investment, with 85% average -- leverage, more so in France. And in the far right column on the screen: This, as you can see, gives us access to funding of approximately EUR 400 million investments in this area. So if we look ahead to the end of the decade, 2030, simply multiplying this, this gives you approximately 600 million for growing Rubis Énergie with external growth and approximately 3 billion that enables us to support the strong growth in greener power market, so we have revised upwards and -- we've revised upwards our targets in this area. We had a published target of 1 gigawatt of operating capacity. We're halfway there. So that's 1 gigawatt by 2025 of installed operating capacity. There won't be any significant change in the target. There will be a small addition to that, a complement, from the external markets, but by 2030, our view is that we will reach 3.5 giga in operating capacity, bearing in mind that 2.5 giga will be outside of France. And the rest will be in France, and the rest will come from European market. Bottom left. You have the cumulated CapEx, which brings us to the EUR 2.7 billion in overall investment, with a leverage of 85% approximately. So the share of EBITDA from Photosol, in other words solar-generated power, will be at least 25% -- and of course, while maintaining a disciplined investment approach with an IRR minimum projected target of 6% to 8%, with a minimal use of nonrecourse debt of 75% to 80%. Now all of these figures, bearing in mind that -- what I was saying to -- earlier on the previous slide, all these will happen without any raising of new equity while -- and maintaining a net debt-EBITDA ratio of less than 2. So with -- staying with a very strong capital base. So I'll hand over to Clarisse.

Thank you, Jacques. Good evening, everyone. We'll talk about the highlights of the first half of '23, our group's financial performance. Bruno will give specifics on that after Robin speaks. So a takeaway point from the first half of this year. First half of the year saw strong growth. In spite of significant currency losses at the group, we've got an EBITDA which is up 30% for the period, restated for several nonrecurring items, inter alia, repayments of losses, for instance, from the Madagascar government, as well as currency fluctuations from Nigeria. Our EBITDA growth is 15% [indiscernible], which is remarkable. As we said previously, we saw some major negative currency effects, mainly in Nigeria and Kenya. The net amount is approximately EUR 55 million. In spite of these major currency effects, our net income is up 8% compared to last year, if we exclude the sale of Rubis Terminal operations in Turkey in the first part of 2022. Our balance sheet continues to be very good. Debt level is slightly down to 1.6x, excluding Photosol's nonrecourse debt. Capital expenditure level is slightly up particularly due to the acquisition of 3 new ships by Rubis Énergie supports and -- support and services and integration of Photosol for a full half year. I'd also like to mention that the increase in our capital expenditure shows our intention to grow all of our businesses in both distribution as well as renewable power production. Lastly, to wrap up on this slide. Cash flow generation continues to be a very high level, cash flow up 3%. We're very pleased of this performance, which yet again is an illustration of our ability to deliver the goods even when the environment is seeing some difficulties in certain geographies. Now let's take a look at our performance more specifically in terms of operations and business line. First of all, I'll talk to you about Energy Distribution, Rubis Énergie. Volumes are up 1.4% compared to the first half of 2022 which already saw buoyant business activity for this group. Jacques mentioned this previously, but I'd like to repeat it: In our product mix, LPG and bitumen represent around 30% of volumes. LPG is a transition energy in most countries where we operate, substituting for charcoal and paraffin. Now bitumen, it's not consumed, of course. Once it's been laid, it doesn't emit any CO2. Gross margin at Rubis Énergie, up 4%; unit margin, again up, by 2.4%, for this half yearly period. Among the highlights of the half year, I mentioned on the previous slide investments in 3 ships. We did acquire full ownership of 2 LGP (sic) [ LPG ] haulers that we're using and a bitumen hauler which was designed especially for our operations in Nigeria. Having to do with generation of renewable electricity, assets in operation and electricity generation, up, respectively, 19% and 16% for -- 16%. The portfolio of secured projects is up 26% versus the end of 2022. Furthermore, we did a first major investment at Rubis Photosol in Italy using a portfolio of 10 projects. These are agrivoltaic projects. The total [ is around 100 megawatts ]. As well as -- and the acquisition of each project hinges on the ready-to-build permit we already acquired through the projects. Several further projects will be acquired before the end of the year -- the development agreements that were also entered into with Spanish and Portuguese developers -- and Polish developers to boost Photosol's development in various European countries. Robin will talk more specifically about the details of Rubis Photosol in a few moments. Now let's take a look at our Energy Distribution business, representing the bulk of our earnings. Currently our distribution -- LPG, bitumen and fuel distribution saw a strong performance in the first half of 2023. EBIT is up strongly -- top ranking always in terms of generating EBIT, excluding nonrecurring items [ and repayment ] of a loss. Africa saw its profitability go up slightly in the first half after fiscal '22 which was especially high. This beautiful performance underscores the effectiveness of our investment plan in Eastern Africa which was begun 3 years ago. We're continuing to further improve our network. There's a rebranding program reaching 90% of our achievement rate. We're also rightsizing our customer portfolio in the geography. To talk about bitumen now. This business is slightly below our expectations, particularly due to the elections in Nigeria which led to some delayed decision-making to start infrastructure projects. We very much hope this will be made up for in the second half of the year after the rainy season is over with. To talk to you about the Caribbean area now. In spite of stable volumes, we can say volumes in Haiti went down, so in spite of stable volumes, we generated EBIT which was strongly up, up 37% (sic) [ 27% ]. All market segments in the geography did well. The retail segment is growing strongly in Jamaica and Eastern Caribbean, Barbados and surrounding islands, thanks to, among others, optimization of service station networks as well as increased nonfuel revenue. Europe now, demand for LPG fairly stable in the first half. [ We would -- observing less ] -- very good performance in the bulk segment in Portugal and Morocco. On that point, we always make sure that we maintain our operational efficiency to continue to win market shares as we've done for many years now. Let's talk now about Support & Services activity. This is continuing to grow under the impetus of shipping activities mainly; the first half of '23 driven by very strong performance in bitumen trading, which made up for bitumen distribution slightly down in Western Africa due to the elections in Nigeria. This is a wonderful example of our agility, our ability to use shipping both in distribution and in trading when we have less in operations. We can compensate using more trading. Aside from all of these financial aspects I've mentioned, let's talk a little bit about CSR. The Sea Cargo Charter issued its first report. Rubis Énergie in that report is seen as a contributor, identified all of its shipping emissions. Its [indiscernible] identified various items very specifically, so we can put together a dedicated shipping action plan. Tracking annual indicators was updated in our road map. This is in compliance with our targets set by the group. We'll be -- we would observe a drop in our CO2 emissions, [ not just ] scopes 1 and 2, in line with our trajectory for internal decarbonization. Now in terms of society. Recently we disclosed our up-to-date ethics code, which is distributed to all of our employees. It's also available on our website, if you're interested in taking a look at it. I'll complete this portion of my talk by talking to you about our storage activities, Rubis Terminal. This is an activity which has done well in the period, revenue growth up 16%, EBITDA up [ 19% ], driven in all 3 geographies of ours: 16% growth in France, to some degree due to the closure of some of the refineries during the strike; plus 7% in Spain, where storage -- fuel storage demand and chemical storage demand has been very strong; plus 30% in the ARA region, particularly with the bringing online of new storage capacities and new biofuel contracts. In line with Rubis Terminal's strategy and joint venture under CSR, the proportion of storage of biofuels and chemical products will continue to grow to reach the decarbonization targets. There you have it. I'd like to give the floor now to Robin, who will talk to us about the first half year of Rubis Photosol within Rubis Group.

Thank you, Clarisse. Good evening, everyone. Yes, I'll be spending a few moments talking to you about the first year spent in Rubis Group, the first [ highly ] active year and where we saw very strong growth in the French market and inroads made in new markets as well. First of all, to begin with, talking about France, we've seen strong growth in our installed capacity by around 23% between June '22 and June '23, going from 313 (sic) [ 330 ] mega in June '22 to 394 in operation in June '24 (sic) [ '23 ]. We should reach around 450 megawatts by the end of '23. At the same time, if we look at our pipeline which is projects we haven't yet reached ready to build, the pipeline is growing significantly, going from 3.3 giga to 3.8 giga between June '22 and June '23 and should reach approximately 4 gigawatts by the end of the year. There's very strong growth in our assets. Of course, it went hand-in-hand with an increase in our head count and employees. Over an 18-month period, number of employees doubled broadly. We should reach around 180 employees by the end of '23. The breakdown is -- this covers all of France. Henceforth, we opened 5 new agencies in the regions after coming into the group, enabling us to develop projects throughout France. Now at the same time as these traditional activities will be Photosol has also wanted to further diversify its offering in France. I'd mention 2 salient examples. The first 1 is our entrance in the corporate PPAs market. We signed our first corporate PPA at the beginning of '23 with Leroy Merlin, 38 megawatts. It's a contract that lasts 20 years, covering assets in Charente. In our portfolio, we've got around 100 megawatts currently being negotiated with various corporations. We will continue developing this segment of corporate PPAs. A second example, which I'll spend more time on later, which is salient, is our developing of rooftops. In November of '23, we acquired the company called Mobexi, which [ is not exactly a ] new area for Photosol, which is small roof areas. I'll talk to you about this later. In addition to speeding up our presence in France. Rubis Photosol also quickly developed outside of France, targeting 3 geographies, firstly, Italy, Spain and Poland. In Italy, as Clarisse said, we acquired a first portfolio of 100 megawatts. 25 megawatts are already at the ready-to-build stage. Within the next 18 months, we hope the 75 remaining will also reach RTB. We're, of course, at the same time developing a platform with employees to develop greenfield projects alongside the 100 first megawatts. Our target for 2030 in this geography, thanks to the teams that are developing new projects, will be to a multiple by 3, to triple the portfolio that we acquired. A second very promising geography is Spain. We signed several partnerships with local developers. We also secured several key interconnections for development. Key to development in Spain is very much interconnection, very important. Our pipeline in Spain currently, after 6 months development, is reaching around 70 megawatts. Third geography, Poland: In the first quarter, we put together a joint venture with local partners here. In the 3 geographies -- and we may well move into other geographies as well, but in these 3 geographies, our strategy, our intention is to mix both project acquisitions that are in advanced stage to speed up growth and also to develop greenfield projects, always working with platform development -- development platforms. Growth in France and overseas could not have happened without proper funding. In 2023, we signed up funding of EUR 115 million with leading French banks to support us on the development in France and overseas. A few words now on Mobexi, which is a company that we acquired in November 2022. For Photosol, this is a significant increase in our offering because, to date, Photosol, put simply, was focusing on major land projects, 5 to 50 megawatts per project. And with Mobexi, we can now target a new market segment, which is smaller rooftops which is 100 kilowatts to 3 megawatts. There are 3 subsegments here. Number one is for the traditional agricultural farming market and Mobexi was developing for third parties. And Photosol will move on to ownership of the assets. Next subsegment is C&I and local authorities, with an offering of auto consumption -- and the third subsegment, which is car, automobile canopies, which is a market we already knew. We've already built several projects for canopies; for example, the [indiscernible] project in Strasbourg [indiscernible] project in [indiscernible], but with Mobexi, we're going to be able to target smaller car canopies. Now there is a commitment by the government to develop this market segment, and market regulation now requires that all car parks with more than 80 spaces have a canopy. This latest regulatory measure has brought about other measures that will enable us to step up the growth of this small canopy market of -- Mobexi also responded to a need for the group to respond to client with car requirements for photovoltaic roofs for small car parks. And since the beginning of the year, Rubis Photosol has created several joint ventures with the group's subsidiaries in order to meet client requirements. For example, [ CLBB -- SLBB ], Rubis Antilles Guyane. And the idea here is to have portfolios which represent us and -- several dozen megawatts. And overall, with Mobexi, this new market should account for 5% to 10% of installed capacity by -- for Photosol. Now we'll focus on the portfolio in June 2023. As I said earlier, the operating assets rose by 23%, so we stood at -- we had 394 megawatts; and we'll have over 450. The secured portfolio with projects that are ready to build has increased from 477 mega in June 2022 to 640 in June 2023, including the 25 megawatts recently acquired in Italy that we spoke about earlier. The current pipeline has moved from, increased from 3.4 to 3.8 giga. This pipeline is approximately 6x bigger than our secured portfolio, and this is where we're going to build the future growth. And we're quite confident given the outlook [indiscernible] by the end of the year. Focusing now on the last 6 months and the switch of assets in the various categories. Now over the past 6 months, in terms of operational projects, only 11 megawatts have switched into this category; in other words, have been commissioned. This is due to administrative delay, connection delays in particular. This should step up again by the end of the year and in 2024. Regarding the projects that are in the process of being built, we had 96 mega in June 2023. 6 projects have been kicked off in the first half, representing 43 megawatts. And the ready-to-build projects stand at 151 megawatts in France -- 151 megawatts in total, of which 25 megawatts in Italy. 6 new projects are underway, representing 112 megawatts. We expect in the next few weeks some good news which will put a different perspective on the figures we're presenting. And I hope we'll have some good news for you both in France and in Europe that we'll be announcing soon. Another important point on the chart here is the average size of the project because you can see that the projects under construction, the 6 projects, account for 43 megas. And this shows a significant shift in the type of projects which is being developed by Rubis Photosol. The size has more than doubled over the past few years. The average size, which was 8 to 10 megawatts, has now gone to 20 megawatts in the ready to build category. And I will conclude this presentation with a few words on a specific project, which is a project at Sauvigny-les-Bois. We had [ planning permission ] in April 2023. This illustrates our growth strategy and the type of development for Rubis Photosol. It's a project, the development of which began in 2020, with [ planning permission ] in April '23. And the construction should be -- start in 2024 or early 2025. An interesting point here is that it fully illustrates the know-how and the strategy of Photosol in the agrivoltaism. It will be used for sheep farming. This is nothing new for Photosol because Photosol, in its portfolio of 390 megawatts, has [ 17 ] mega in agrivoltaic projects. So we have a lot of experience and we intend to step up with the agrivoltaism segment. We have 67 people working full time on this. We've established partnerships with [indiscernible] farming unions. And we have great confidence in this market segment. In 2024, we'll be working on 3 areas: number one, financing. It's a 50-megawatt project which is approximately 30 million to 35 million in CapEx investment and 30 million in debt, so the leverage is approximately 90 million, and nonrecourse debt with a maturity of approximately 20 years. We're working on financing. And we're working on the selling strategy for electricity with PPAs and the CRE contracts. I'll hand over now to Bruno for the rest of the presentation.

Thank you very much. So we'll move from that with a comment on the financial results. We've already said quite a bit about this, so I'll be brief but just to give you the key highlights here. So for the second 6-month period in a run, we see a shift, with a very strong increase in operational activities, with the operating income, which are offset a bit, lowered down by foreign exchange losses which were quite significant. So we have seen a continuation of what we saw in the second half of last year in actual fact. And to sum up: The operating income -- in other words, the increase in volume, the resilience of our margins have enabled us to generate a reserve, a cash reserve in terms of results, to be able to absorb the currency impact. And this still leaves us with net income which is up on a published basis, plus 20%; and 80% when adjusted for the nonrecurring items, namely last year's capital gains. So 8% is the figure to keep in mind when we measure the growth for the first half of 2023. Now going back to the significant growth that you can see on the operating parameters, 30%, 32%, looking at EBIT and EBITDA. And we've established a mechanism which -- vis-à-vis customers in Nigeria to whom we sell bitumen. It means that we inflect the invoices charged to these customers to take into account the expected currency losses that we expect. And this situation was due to the fact -- this is no longer the case, but it -- this was due to the fact that, for a long time in Nigeria, we had different exchange rates. There was an official exchange rate set by the central bank, an interbank exchange rate. And then there was a secondary market for exchange rate. And all this was -- these were all virtually official rates with significant discrepancies. And a new legislation which was adopted in June of this year adopted a reunification of all of these exchange rates, so broadly speaking, this means that we have a devaluation. And it also means that, if you have a devaluation, then this means a more accurate exchange rate. And this means that we should expect that foreign investors who've stopped [ invested ] due to currency risks in Nigeria will now be more comfortable with investments in Nigeria because they will be [ paying ] the actual price, the real price for their investments. So ultimately what we have since June has been a good thing. Admittedly it's cost us 15 million in the financial statement and in terms of the currency impact of it down in the income statement. And the first EUR 25 million in exchange rate losses inflated the ROC and EBITDA -- have been offset -- basically they've been neutralized. And the second point, which has inflated the top section of the income statement, is the reimbursement by countries such as Madagascar of shortfalls due to the non-application of the price structure since the end of '21, throughout 2022, due to the very strong increase in oil prices and the policy of these governments which was to smooth out -- to put a cap on prices in order to help the population spending power. And this had a negative impact on the income statement. And the commitments have been made by the government, so this would be a temporary decision. And these governments have kept to their word, and they have compensated 12 to 18 months later the impact that we had undergone. So what's important to remember is that we have a commitment here that was implemented. Lower down on the income statement, you can see a strong [ increase ] in contribution from associates, equity affiliates, EUR 6 million versus EUR 12 million last year, EUR 12 million. Much of this was a capital gain on the sale of an asset in Turkey. So here we're now this year coming back to more usual levels. This is our contributions has doubled from Rubis Terminal if we cancel out the effect of the nonrecurring items. Also financial expenses. This will surprise no one. Financial charges went up significantly very much due to transition from a [indiscernible] rate and the [ Euribor ] rates and the dollar rates, the financial expenses going from EUR 16 million to EUR 36 million. Nevertheless, interest rate paid on average on our debt is below 3%. Under ForEx financial charges, you can see EUR 80 million. We talked about this a little bit higher up, ForEx losses, versus around EUR 20 million at the same time last year. This is also the same level in the amount we'd booked in the second half of 2022. Here again if we separate out this figure, you have to correct it for the, of the EUR 25 million which inflated the income statement a little higher up at the EBIT level. Real loss, so to speak, if we can call it that, is only EUR 55 million. Tax rate is 16% due to the strong performance in the regions where interest rates were low, such as in Support & Services -- sorry, where tax rates were low and in the Caribbean as well. This brings us to EUR 171 million in net income group share, which is a 1% change. Corrected for the nonrecurring items, it would be up 8%. Here we can see a breakdown of growth in operating income between 2022 and '23. Here we can see a strong contribution from Africa for the same reasons. There are currency effects; neutralizing losses inflated by the contribution from Africa; also Madagascar, a very good contribution which is recurring, in this instance, from the Caribbean region both in terms of volumes and margins; also gains in market share, so we're seeing very significant growth in this geography. Europe. We talked about Europe is mainly LPG; a more mature market also impacted by the climate effects, mild winter yet again, also some stock effects which had a slight impact on contribution here in this half year. Support & Services, supplying third parties, trading activities and shipping activities; this area up strongly. We talked about this a moment ago. Contribution is almost EUR 20 million. The contribution from Rubis renewables is in the beginning stages, so we have to look at it as is currently. What's very important in this business area is to look toward the future. Look at the major investments we're making now and the outlook for significant growth and development, in conjunction with the presentation that Robin made. That brings us to the EUR 323 million in operating income in this half yearly period. Let me talk to you briefly now about our financial results. Rest assured, for the umpteenth time, I'd say it, the balance sheet is strong structurally. It's a company that has the wherewithal to finance both its investments and its growth and also pay out its dividend. We're finishing the period with overall debt level group-wide standing at EUR 1.5 billion, which is a ratio of debt over EBITDA of 2x. If we correct this for the debt [ accommodated ] in the solar power areas, where this is nonrecourse debt, the selfsame ratio at the consolidated level is 1.6x the relevant to -- related EBITDA. And that's an important point to observe. Cash flow. There were operational cash flow effects. This is up 3%. Change in WCR: Last year, this was a drop, [ 110 million ]. We don't have [ that big of an effect. This year it's only ] EUR 48 million (sic) [ EUR 58 million ], so a strong improvement in that respect. This made it possible to finance investments, growth and pay out the company's dividend. So there you have it.

Thank you very much, Bruno. And now we'll -- going to move on to the main conclusions for the half year. What would we say? First of all, the half year was very strong, which illustrates the appropriateness of our [ policy of ] diversification in terms of products and geographies in spite of currency effects which were relatively significant. We do observe net income, excluding the sale of Turkey, up 18%; strong cash flow generation, making it possible for us to confirm yet again our objectives of increasing the dividend. We've increased our objectives for Rubis Photosol in [ '25 and ] 2030. We've got a European development plan, opening new prospects for the development of Rubis Photosol. Of course, we're updating our CSR road map, all of this in line with the group's targets in this area, we -- post the first Sea Cargo Charter report, for the Rubis Énergie shipping portion -- first carbon footprint assessment being done by Rubis Photosol. We're the first CSR road map to be included within the group before '25. Now let's look at the outlook for the rest of 2023 broken down by products. First of all, bitumen: Nigerian elections have taken place. We believe that bitumen business will resume, come back to a buoyant level; gain momentum once the rainy season is over. LPG, there will be no significant surprises to be expected, neither in Europe nor in Africa. Regarding fuels, the business should continue to grow at a good pace in the Caribbean. And in Africa, there should also be further development of income in nonfuel areas. Among the various areas of uncertainty, we would identify [ and could question ] our estimates. First of all, we mentioned a possible deterioration in the situation in Haiti, which of course would be bad news even though the impact on the group would be limited, concerning the current level; and if there are further currency fluctuations, if they further impacted results in the second half of '23. Also, for the first time, furthermore -- we can, for the first time, say, unless there's any major -- assuming no further deterioration in market conditions, our 2023 EBITDA should be between EUR 690 million and EUR 730 million at the current currency situation, which is midway through the current consensus. I'd underline Bruno said earlier H1 includes [ 50 million ] in nonrecurring items which won't, therefore, take place again in H2. Growth in our dividend is confirmed as well. Lastly, we'll come back to you sometime during 2024 to present to you our group's ambitions and our financial trajectory for the medium term. We'll hold a CMD for that. Thank you very much. [ We'd be only too happy ] now to field any questions you might have.

Thank you, everyone. We're going to begin the Q&A session. [Operator Instructions] I have a few questions in writing now which we received. First, from Eric (sic) [ Deryckx ], [If I'm not mistaken], representing Kepler, who is interested in the following item. He says we've revised outlook on Photosol. I announced this. Percentage of EBITDA from Photosol remained at 25%. People might wonder about that indeed, but what I was -- intended to say and what was written here was that the 25% is a minimum percentage EBITDA as Photosol's proportion within the group by 2030. It will be at least 25%. At this juncture, we can't give more specifics on that, 3.5 giga installed capacity by 2030. That's our target, but it's not cast in stone in terms of target.

Next question [ from the person ] are having to do with the situation in Haiti. First of all, as everyone knows, the situation is still very difficult from a political and social point of view. And there are safety problems in Haiti. Nevertheless, we continue operating there and downgraded. Moreover, we continue operating in Haiti. For instance, we continue supplying important supplies to telco stations, for instance. Regarding volume sales: Well, the volumes have gone down very significantly over the period to the tune of 30%, but due to improvements in margins and currency effects, inter alia, there was a better contribution in the first half from Haiti than we saw in the first half of last year. We have a further question. This one is on bitumen business in Gabon. Gabon is a country we entered very recently, about [ 3% ] of bitumen volumes. There's also a question asking why we don't buy back our own shares, "Since you feel your current company is not valued highly." I thought I said that, but we don't buy back our own shares because we intend to build for future years. We're building Rubis Group which is a high-performance group growing strongly, yielding cash flow and paying a dividend. We have to build the group now. It's now particularly in the area of photovoltaic businesses. Now things are happening. And then investments must be made; also continuing, as I said, investing in Rubis Énergie. There's great works we've done there as well. And demand is increasing for carbon-based products. And we hope more and more for biofuel products as well. EBITDA questions in Gabon. We mentioned the EBITDA from that country is very small. A question for Bruno. If you adjust the EBIT, how can it grow by 21%, whereas gross margin after adjustment only goes up by 4%? The total adjusted amount isn't the same between those 2 indicators.

Well, yes, that's what we were saying earlier. Gross margin is up by 2%, but in the operating income, you've got specific items. We inflated, selling prices in Nigeria, for instance, by EUR 25 million. That increased operating income. Growth in margin, which was disclosed, has been adjusted for the products invoiced of -- inflated invoiced -- invoices in Nigeria. If you take into account gross margin, it's up 18%, not 2%. This is consistent, therefore.

[ Here ], another question. This one is on electricity production. With negative EBIT for the first part of the year, what are our expectations for the amount in the next period? This was expected. Contribution to EBIT has to be looked at carefully. You're talking about generating EBITDA. You have to expense this if you take into account significant amortizations that have a negative accounting impact, [ not cash flow impacts ] but an accounting impact, on EBIT. This is a standard way of viewing renewables, especially for companies that are seeing significant growth.

Yes. A takeaway point on this business area, an important metric, is an average project in terms of IRR, project industrial business IRR between 6%, 7%, 8%. In addition, as you know, when you consider the leverage these facilities, up to 95% leverage, then you go from 6%, 7% or 8% project IRR to an equity IRR, an investment equity IRR which is well above that, at least double, and sometimes more than that compared to the project IRR, 15%, 20%. This is what you have to keep in mind when you analyze the performance of the renewable business, which is clearly different from more traditional businesses.

A question from CIC regarding cooperation with HDF Energy, [ to ] Clarisse.

HDF Energy. Well, we have 2 projects under development, 1 in French Guiana, which is called CEO (sic) [ CEOG ], which is spearheading HDF, whose main shareholders are [indiscernible] 75%. And HDF is the historic project here, the construction of which has restarted after the rainy season and the commissioning should be within the next 18 months. And we also have another project in Barbados and which is with Rubis Caribbean taking 51% stake, which is going ahead smoothly. And we have not completed yet the development phase. So CEOG is under construction. And Barbados is under development, with some conditions that still have to be set before we finally launch into the construction phase of the project.

Mr. Matot has a question on ForEx issues and problems. And he's asking us about the reasons for which we cannot pass on ForEx problems to clients in Kenya. We -- contrary to what we do in Nigeria. Now you're right. The countries are in 2 very and -- different situations. And the ForEx are -- costs are due to 2 completely different mechanisms. In Nigeria, you have a free market, so we are dealing directly with our client. And this is -- I mean, where it is a discussion, it's a negotiation; and we are able to pass on the cost and -- that we bear in this respect. The business model in Kenya is different because the markets are regulated, and the currency cost is due to a different mechanism, which Bruno explained. And it's due to the fact that we kind of have acquired in the country the dollars that we need to pay for international purchases -- or purchases on the international market of the required product, so there is a mismatch, which means that we borrow dollars either from the suppliers or from the banking system, mainly through the banking system, which creates a dollar exposure, which we seek to reduce as much as possible, but it generates the cost. The situation has improved in Kenya because, since April, the Kenyan government has negotiated all product imports directly with countries in the Middle East. These -- all products are sold to the operators. That's the next phase, with payment in local currency. So for the past few months, and for the next few months if the agreement is renewed, we've been able to alleviate the ForEx problem.

And I should also say to our listeners that we have an $80 million (sic) [ EUR 80 million ] FX loss. It's quite a lot on our income statement, but as Jacques was saying, the second half would be much more positive in this regard because we have virtually settled the -- or removed the uncertainty in Kenya. And so at the beginning of the year, we have significantly converted our amount, our shilling-denominated cash converted into dollars, in order to reimburse our commitments in dollars, so we've significantly reduced our foreign exchange risk in Kenya. So this is the case at present and this will remain so till the end of the year. And secondly, in Nigeria, the worst is behind us. The reunification of the different exchange rates has happened with an immediate spot impact, but henceforth, we're going to have a trend with unified exchange rates. The fact that there's only a single exchange rate will enable us to pass on any currency impact directly to clients, which is what we do in all our other geographies, so we will not in the second half have to deal with the situation that we were facing in H2 '22 and H1 '23.

Question from [ Deryckx Lienart ] on the impact. This is for Robin, on the potential impact of interest rates on power generation products. Could you perhaps give an answer on that?

Well, you have to draw a distinction between 2 categories of projects, those which are already operational which have bank funding. The funding, these financing structures are hedged to the tune of 80%. If there's any increase in interest rates, it has a very marginal impact on the unhedged 20%. And on new project, keep in mind that, when we respond to a call for tender, I'm talking about the CRE, we set the price depending on the existing economic situation, which includes interest rate increases, inflation. And the [indiscernible] rates that we submit depend on these new economic parameters, and the impact of interest rates is reflected in the new prices. And what we've seen since -- over the past 2 years is an increase in prices which have gone from 5.8 cents for the kilowatt per hour to about 7 cents or 8 cents for the CRE to reflect higher inflation and interest rates. So no immediate impact on the projects, apart from a few projects which may be caught up in a [ scissors effect ] which is that we have secured the purchase price but the [ tax ] has not yet been secured. And we have a few projects like this last year with some [ regulatory ] measures made by the government in order to offset the loss arising from higher interest rates or inflation. So this concerns a few projects. It's a temporary thing with some offsetting features.

A question from [ Mr. Wail ] on the impact from the recent pickup in the oil price for the unit prices; and some additional questions. Bruno, I think, has already answered this question quite extensively on the doubling of the financial result. Is there an interest rate impact? But I think we've given the main reasons. And can we have an assumption on the FX effect in Nigeria and Kenya after the EUR 25 million nonrecurring item which is part of the expected EBITDA result? I'll let you answer that, Bruno.

Regarding the impact of the oil price, the increase in the oil price. These are the conditions under which we operate since oil has been [ neutral ]. When the oil price goes up, regarding our business which is the distributor of oil products, the situation is less positive because we have to pass on the increases to our clients, bearing in mind that for most of our volume we're operating under contracts with regulated margins. Therefore, the passing on of the price increase to clients is done automatically. And conversely, when the oil prices decline, it's easier for us since we can manage our margins while passing on the decline to our customers. So it's very difficult to give you an assessment. In very few months or a few weeks time, usually we are able to pass on changes in oil, international oil, prices if they don't skyrocket, which isn't the case now.

Would you like to comment on something, Bruno?

Yes. To repeat: What we see in the income statement, this EUR 25 million canceling out the currency effects by extra margin, that is smoothed out by several currency rates. And by unifying the currency rates, we no longer have this mechanism because, in fact -- almost no extra margin gradually; and at the same time, less currency losses, specifically we saw in July and in August, which is to say we're perfectly on track since the devaluation in mid-June. That's why we're highly confident in what's going to happen both in Nigeria; and then for other reasons, as I explained, Kenya. What was problematic in Kenya? Every country has its own specifics and difficulties. The issue there was a scarcity of dollar availability. A great deal of work was done at Rubis Énergie to find sources to convert the shilling into dollars. They were successful, which made it possible to significantly reduce our shilling balances, converting them into dollars; and then to repay the bank overdrafts in dollars, so we can say now we're no longer exposed to this risk in Kenya. Both in Nigeria and in Kenya, we're very much headed in the right direction.

Thank you, Bruno. I believe we've gone through all of the questions. I'd like to thank all of you very much for your attention and for the interest you've shown in our group. We'll meet again later when we look at the annual financial statements. Thank you very much. Have a good evening. [Statements in English on this transcript were spoken by an interpreter present on the live call.]