Rubis (RUI) Earnings Call Transcript & Summary

Hello, everyone. It is a joy to see you all for our full year results for 2023. And here we are with Clarisse and Bruno and would all like to thank you for joining us. First and foremost, I would just like to quickly go over our main business lines. Give you a few highlights for the 2023 financial year. I'd just like to say that we've reached all of our targets, and then we will get a very quick overview of our investment policy and cash flow allocation policy. Clarisse will then go over some of the major financial highlights for 2023. And Bruno will look much more closer at the financials. Clarisse will wrap up for expectation for 2024, and then we'll field any of your questions. So no real surprises for most of you. We have 2 main business lines, our legacy business lines, energy distribution. And then on the far right, we have bulk liquid storage for industrial clients. And the third business line, a bit more recently as of 2022 is when it comes to renewable electricity production with solar power. When it comes to energy distribution, we have businesses in Africa, in the Caribbean region, in Europe and we provide energy and which went to B2C and B2B customers. The main product that we operate with is LPG. It is seen in Europe as a transition energy which still has quite a high level of CO2 emissions attached to it, and it's mainly for peri-urban and rural customers. But it is highly advantageous in African and Caribbean area where it is quite present, well really in Africa because it is a way of transferring away from energy sources, which are highly carbon-intensive such as kerosene and coal, and that's for individual use. We also have a large network of service stations that we provide fuel to and lubricants. Now that business line in Africa is really buoyed up by the growing population. And also because there is a growing middle class with an increasing purchasing power. In the Caribbean, we see that, that business is being driven mainly by the North American economies, mainly America, the United States of America, because they provide a lot of economic inflows through tourism and the like. And we are generally either #1 or #2 in the respective countries because we provide a niche service with long-term goals. As for our bitumen business, we are a leader in Africa. And for that, we really depend in the long term on the infrastructure needs in Africa. So all of that business makes up for about 96% of our group fixed assets -- sorry, 80% of group fixed assets and 96% of group EBITDA. The other legacy business line is about liquid storage. So we produce industrial liquids. And what's interesting is that for a long time, we used to store oil-based products. About 70% of that was oil based. And we've actually been able to drop that by about half and now that business is predominantly for biofuels and other chemicals. And another part of that business is focused on French state strategic reserves. use. We also have a large network of service stations that we provide fuel to and lubricants. Now that business line in Africa is really buoyed up by the growing population. -- and also because there is a growing middle class with an increasing purchasing power. In the Caribbean, we see that, that business is being driven mainly by the North American economies, mainly America, the United States of America, because they provide a lot of economic inflows through tourism and the like -- and we are generally either #1 or #2 in the respective countries because we provide a niche service with long-term goals. As for our bitumen business, we are a leader in Africa. And for that, we really depend in the long term on the infrastructure needs in Africa. So all of that business makes up for about 96% of our group fixed assets -- sorry, 80% of group fixed assets and 96% of group EBITDA. The other legacy business line is both liquid storage. So we produce industrial liquids. And what's interesting is that for a long time, we used to store oil-based products, about 70% of that was oil based. And we've actually been able to drop that by about half -- and now that business is predominantly for biofuels and other chemicals. And another part of that business is focused on French state strategic reserves -- so using the equity method, that's how we account for that. We also generate, as I mentioned a little earlier, solar power. We have Rubis Photosol in Europe, mainly in France with a few inroads into a few other European countries, but we're also present in the Caribbean area, thanks to a partnership that we have with Hydrogène de France. As of end of December, we had 435 megawatts installed capacity, 4.3 gigawatts in the pipeline. So you can see it's quite a big ratio there, and that's very indicative of how this business really tends to grow and the growth opportunities that we're expecting to see from it. As I said, we have heavily vested in France. We're probably one of the top 5 operators in France and we have made in roads into Italy with 10 projects for about 100 megawatts and also 30 megawatts in Spain, again, with 300 megawatts in the pipeline. The EBITDA share of renewables, as I'm sure you could understand. And given the extreme growth of the group is quite limited yet it still has very high growth, double-digit growth. So solar electricity makes up for about 20% of our group fixed assets. What's important to bear in mind when looking at our 3 main business lines is that we have 2 of them, which are legacy and they provide strong cash flow because they are mature markets and growing markets and that cash flow can be allocated predominantly into developing our renewable energies. Few main highlights for 2023. 2023 was quite a good year because, as you can see, our EBITDA is up 19% year-on-year. Strong cash flow, up EUR 583 million, so that's up 35%. And this is really because top quality businesses, strong business based on cash flow. The cash flow that you have up on the screen is obviously after financial costs and after tax. Quickly about Photosol. One of the main highlights there is that we have a secured portfolio up 77%. In terms of the secured portfolio, we have everything in operation, everything being built and everything that is ready to be built, so that there are those operations where we already have permits in place and a contract. With all of that in mind, we can now offer shareholders a dividend of EUR 1.98. Now probably you remember that the past 25 years, our dividend has been constantly rising. Now that said, we must bear in mind that the economic backdrop is not as stable as we would like. We have prices rising. After a peak in 2022, they still remain high, which impacts end customers and actually in a number of our countries, predominantly in Africa, like in Nigeria and some other Eastern African countries, in Kenya, for example. These are countries that have been facing considerable macroeconomic hardship. And this has had a huge impact in terms of foreign exchange. So we have had some foreign exchange negatives. But nevertheless, it has not impacted overall growth. Now when we look at the targets that we set ourselves for 2023 in terms of EBITDA we laid down a guidance range of EUR 690 million to EUR 730 million, and we were almost at EUR 800 million. So that's up 19% year-on-year. And there's roughly EUR 50 million in positive effect, which won't necessarily be recurrent or so it's going to be more likely one-offs. In terms of net income, EUR 354 billion, well, there are 3 ways of looking at this? If we look at it in terms of adjusted net income group share. So we adjusted both 2022 and '23 for one-off items, and we still have plus 8%. Now plus 8% that indicates our ability to really tap into all of our growth drivers and using them as a way to offset negative impacts from the economic climate. Again, if we look at our Haitian assets and how we can amortize that, we have growth of plus 17% and 35% -- plus 35% for the overall net income group share increase. Now as I just mentioned, we have a dividend growth, which is perfectly in line with our dividend distribution policy, which we have been abiding by for some time now. And the final point, acceleration of renewable energy development with Rubis Photosol, you have that there as well. So that gives us quite a satisfactory overall portfolio. Moving on to the next slide. This is just a way to illustrate what I said as my introduction. We have an ability to generate cash flow and allocate that cash flow to developing other businesses. If we work from the left to the right, you have a good example of cash flow from existing activities around EUR 450 million. That's post financial costs. And obviously, it's not exactly the same as what we had in 2023, but let's just take this as an example. With this level of cash flow, we can pay out a dividend around EUR 200 million in dividends. If you work down a little lower, EUR 150 million can go into investment and maintenance CapEx. And the left over, roughly EUR 100 million is cash that is left over to develop our growth drivers. Moving over a bit further to the right. We have the 4 main areas where we can allocate that money, EUR 40 million can go into our traditional businesses. So energy distribution -- sorry, EUR 80 million can go into energy distribution and storage. Now we used to have a 50-50 split between equity and debt -- so when you have that 50-50 split, you get that total of 80 -- if we look at renewables, if you have cash -- available cash of EUR 60 million, plus a leverage effect of 85%, that's quite high. And that's just on average, obviously, we're a little higher than that in France. It means we can add in an additional EUR 340 million of external debt for Photosol and that's in France and around Europe. So that's a total of EUR 400 million over the full year. Obviously, we said that we want 25% of EBITDA to be put back into these businesses by 2030. And you can see that there's EUR 1.5 billion in investment that we can fund while still covering our original maintenance businesses and while still covering our legacy businesses. Just quickly talking about our investment policies. We've always been very disciplined by maintaining our long-term plan by focusing on energy distribution, which is, again, our legacy business line. We really focus on bolt-on acquisitions in our existing geographies, ways of bolstering our current business. And we are really looking for opportunities out there. Obviously, we're not going to look for any opportunities that don't make sense when trying to add extra value to our shareholders. So as I said, these sorts of opportunities are funded by debt for about 50%. Now when talking about renewables, we want to hit project IRRs unlevered of about 7% to 9%. Now what that means is that once we tap into nonrecourse debt financing, we should hit about 80% to 90%, we should be able to get equity IRRs that are quite high, almost double digits. Now again, because we already have a solid footing in France, we can still develop in other countries, Italian and Spain, first up, and then we can look for other field and this type of investment secures revenue over long periods. And that actually explains how it is so easy to refinance it. And we can go 10 up to 20 years, 20 years when talking about France with CRE-type contracts or it can be about 10 to 15 years when looking at corporate PPAs. So these are contracts with companies who want to use more green energy. Now either be it out of principal or because of requirements. There's also a new segment that we are investing in and when talking about solar plants, it's no longer ground-mounted -- large-scale grounded solar plant, but here we're talking about small-scale PV plants. And these are key solutions, which really tap into current simplification policy that is being brought in. And so we have Rubis Photosol that really focuses on this key market, and these are high-growth markets. And it's a sort of a solution that you can roll out on a car box. And also talking about new segments. Another area that we are looking at is battery energy storage systems. Now whenever we get a construction permit, we also ask for the necessary approvals for this. And we are already starting to send in bids for specific tenders for these sorts of systems. And we see it growing in plenty of countries, and we are sure it is going to continue to grow in the future. Now what's interesting is that you have both electricity and distribution business lines. And by developing then we are going to really leverage our major accounts that we already have with major corporate players by providing with carbon or low carbon solutions. And we're going to be able to really leverage our geographical footprint in Europe, in the Caribbean region and in Africa because a lot of customers are calling for more hybrid solutions. So a combination of oil-based products tied in with green electricity solutions. That's pretty much it for the overall view I want to give. Why don't I quickly hand over to Clarisse?

Thank you, Jacques. Okay. So I will tell you about our performance and how our subsidiaries have grown. I will start with a presentation of our financial performance in 2023. So the highlights, as Jacques as already said in his introduction, is the fact that our performance has been very solid with EBITDA up 19% over the period. However, there are a few exceptional items that Jacques has already told you about that Bruno will also tell you about a little later including reimbursements of lost earnings, particularly in Madagascar and the inflection of the margin in Nigeria for EUR 32 million passed on to customers, which somewhat distorts the interpretation of this performance. But excluding these items, EBITDA growth has been around 15%. As Jacques has said, we've also suffered significant foreign exchange losses, mainly in Africa, particularly in Nigeria and Kenya. So our net ForEx loss amounts to about EUR 74 million versus EUR 60 million at H1 as we announced in September. And as we already explained, H2 was better controlled -- much better controlled in terms of ForEx losses. So despite these losses, our net income came in at EUR 354 million, up 8% versus last year, excluding one-off items. Our balance sheet remains healthy as a result with leverage down -- slightly down to 1.4x, including Photosol's -- excluding Photosol's nonrecourse debt. The CapEx level is under control as you can see on the slide, the 10% increase between 2022 and 2023 is accounted for by our energy distribution business and what happened in the Caribbean. As for cash flow generation, it remains at a fairly high level cash flow -- with cash flow up 34%, in line with the increase in our net income. I still wanted to tell you that we're very proud of this performance, which illustrates our ability to deliver even in an environment that has been turbulent in some of our geographies last year. Moving on to our slide about energy distribution and the highlights. Our LPG fuels and bitumen distribution activities delivered a very solid performance this year with strong EBIT growth of 20%. In first place, in terms of EBIT generation, the Caribbean region saw its profitability increased significantly in 2023 after an already very profitable 2022 financial year. This strong performance highlights the efficiency of our operations in the region as well as the growth in some regions like Guyana and Suriname as well as the relevance of holding our vessels in full ownership strategy, which we put in place a few years ago and which positions us particularly well in the context of rising shipping rates on a global scale and helps us to be extremely agile and effective. As far as our investment plan in East Africa, it's continues to bear fruit, the improvement of our network and the rationalization of our customer portfolio have enabled us to significantly improve our margins, particularly in the Aviation segment. On the bitumen side, activity was slightly below our expectations. In particular, due to the political context in Nigeria as well as foreign exchange issues that I've just mentioned. The other countries, South Africa, Togo, Senegal, Cameroon and others have performed well. LPG in Europe continues to grow at a very satisfactory rate around 4%. We maintain our operational efficiency and excellence with a view to further gaining market share and maintaining high margins. In addition to these business-related aspects, 2023 was marked by the publication of the first sea cargo charter report. Rubis Energie in this context has identified all of its emissions related to charter activities with a view to drafting a dedicated decarbonization plan between 2023 and 2030 so as to reach the minus 30% target on Scopes 1 and 2. We are also delighted to announce that Rubis Energie's Scope 1 and 2 carbon intensity ratio is down 34% compared to our reference year 2019. Moving on to Rubis Photosol. Rubis Photosol has been growing well this year. It's been a great year in terms of development. The secured portfolio has grown by 77% in 2023, bringing us closer to gigawatt, we have also double the size of teams, particularly on the development side to give us the means to achieve our ambitions towards 2030 with Photosol accounting for 34 -- 35 gigawatts in operational terms. We've also eased access to the financing market. With regard to our development in France, our revenues for the next few years from power plants in operation or under construction are already secured and stabilized whether through CRE contracts or whether that's through corporate PPAs. This gives us all the more peace of mind as we have just won the latest round of CRE call for tenders with 257 megawatt, this slot includes the flagship project of [indiscernible] of about 200 megawatts which once built, will be the second largest solar power plant in France. And the first plant will be commissioned in 2025. Photosol and that's something new that happened this year has started positioning itself in the small solar power plant market for B2B customers with the acquisition of Mobexi in late 2022, as well as a small actor, small player Ener 5 in early 2024, bolstering our presence in France. At the same time, codevelopment JVs are underway between Rubis Photosol, Mobexi and some of Rubis Energie subsidiaries developing small solar plants, particularly in French overseas territories and in the Caribbean capitalizing on Rubis Energie's customer portfolio. Internationally, our Italian portfolio continues to grow in -- at the end of 2023, we acquired 44 megawatts that has reached RTB status and should be commissioned between the end of 2025 and 2026. In Spain, we already have 30-megawatt RTB and our partnership feeds our pipeline to the tune of around 300 megawatts. Now moving on to the next slide. It's a slide that you -- we've shown each time ever since we acquired Photosol. This is to show you what the project looks like in late 2023. And it's an illustration of how dynamic this project, this activity has been over the past year. Assets in operation have increased from 383 to 435 megawatts in 1 year, an increase of 14%. Our secured portfolio reaches 893 megawatts, including the 44-megawatt acquired in Italy. Now project pipeline is at 4.3 gigawatt at the end of December, which represents about 5x our secure portfolio and gives us peace of mind about the development over the next few years. As far as our Rubis Terminal JV is concerned -- again, this business has done well with revenue growth 14% and EBITDA growth of 16%, in line with recent periods, the proportion of stored biofuels and chemicals is growing sharply, great performance all around this year. These past few years, by the way, this subsidiary has worked extensively to reverse the product mix of its stored products by significantly increasing the proportion of stored chemicals and biofuels. This great performance is also the result of decisions in terms of new storage capacities in the area. And I'll now give over to Bruno, who will present the group's financial performance.

Thank you, Clarisse. I won't be long because everything has been said and very well explained. Now looking at the slide. You'll see a high [indiscernible] 2022 EBIT to the 2023 EBIT from EUR 509 million to EUR 621 million at both ends of the slide, showing you a growth of 22%, which we mentioned before for this indicator. If you go back in time a little bit, let me remind you that volumes for the whole of Rubis Energie have grown by 4% over the 3 continents where we have a presence. This graph also shows digital -- all geographies are in positive territory as far as growth is concerned, Africa with 8%, Caribbean or -- at 45% plus -- 45%, Europe, logically 4% but support and services plus 20% renewable. Energy is on the rise. It's still a slow rise at this stage, but that's to be expected. And going back to Rubis Energie, we have mentioned a growth of the distribution -- retail distribution side of 20% in terms of EBIT. Logistics third-party shipping and chipping are also seeing a growth of 20%. And in terms of the geographies, the Caribbean region has performed particularly well with a record year in terms of both volume and margins and market penetration. With the Aviation segment doing very well as well as LPG lubricants. So all of the traditional segments of oil products have shown a lot of progress in the region that has also been -- or whose economy has been driven by tourism from the U.S. and Canada, which is the main driver of these island economies. Now, as far as Europe is concerned, this is a good level of performance because we're mostly present in LPG. A mature market, yes, but which should generate good cash flow and very secure cash flow that is labeled in Euros and has seen its contribution or its share go up as you can see from the figures on the slide. In terms of EBIT, Africa is up 8 percentage, is much more diversified between or across LPG service station, networks and bitumen, which is present in the infrastructure segment, I would say. So that's very much linked to the long-term investments of these economies into their road infrastructure. And we are supporting what these countries are doing with a focus on Western Africa, with new territories and new markets that we have been able to start developing such as Angola, South Africa, Gabon, Cameroon, -- and I would say that about 10 years ago, we were mostly present in Nigeria and in a few countries around Nigeria, whereas today, as we speak, we have a presence in about a dozen countries in Nigeria accounts for under 50% of our business in Africa. Of course, Nigeria counts because it is the most populated country in Africa with over 200 million inhabitants and colossal infrastructure needs. So yes, there you go. Rubis Energie's business in Eastern Africa with, as you know, the major acquisition that happened in 2019. Well, growth has been good in terms of contribution as well as in terms of our BP with EUR 58 million to EUR 60 million in EBIT for this branch, which was our objective towards 2023. And we're also confident in terms of how this contribution is -- or this share as it's going to continue growing because we're talking about a region of 250 million inhabitants and strong economic growth in those countries, which means that people will need more and more oil-based products. In fact, at a rate even higher than the economic growth rate. So that's what I had to say about the economic contribution of Africa. In terms of Rubis Renewables, EUR 4 million is still a modest figure. But I would say that's just the takeoff phase because look at the structure of these assets, we have 430 megawatts that are already installed. We have a large pipeline of projects. And you need to bear in mind that it is assets -- installed assets, existing assets that generate the profit. And all the rest just generate costs at this stage. And as you've seen before, the ratio of pipeline to assets in operation is very high. So the configuration you're looking at is young companies, growing companies with extensive or high costs in terms of their development, which is absorbing a lot of the EBIT of operating companies. But the operating structure is such that as soon as these installations are commissioned, 8 megawatt which was being -- which was in construction and becomes operational megawatt sees all of its costs covered in just 6 months. All the cost that is served to build it are actually covered and absorbed in just 6 months of business -- of doing business. So obviously, what we're doing is working on the growth dynamic from going from the pipeline and pushing the pipeline towards more operational or operating businesses. And as we accelerate that dynamic, the EBITDA of the renewable sector is going to rise. So those were a few general remarks about Rubis. And just a few words about this chart. So the EBITDA is strongly growing, the EBIT, those growth rates -- really are cash based because cash flow is up 35%, as we've seen. So this is a great result. The quality of the results is really there. As far as the EUR 15 million that you see under associates, the share of net income from associates is mainly -- that's mainly Rubis terminal whose contribution has risen a lot over that fiscal year. We have one item representing a nonrecurring expenses -- income and expenses going from minus EUR 58 million in 2022 to a positive figure of EUR 7 million in fiscal year 2023. Let me remind you that in 2022, we had 2 exceptional nonrecurring items in impairment test with goodwill depreciation of EUR 40 million in Haiti on the one hand as well as acquisition costs in the context of our acquiring Photosol up to about EUR 20 million. This year, we are seeing a positive figure, which is the sum of the fact that we have won an arbitration case in Kenya that pitted us against the seller and the arbitration court, in this case, has vindicated us and is [ faulting ] the seller to pay us a penalty of about EUR 15 million. And on the other hand, there is the rest of the Photosol acquisition cost which means that we get from EUR 7 million to EUR 15 million after taxes. So that's the explanation of the EUR 7 million in the nonrecurring income and expenses item. As for financial charges, so the net financial charges, they have doubled going from EUR 41 million to EUR 84 million. That's not because of an increase in debt, but that's due to an increase in rates. So that's not what we really saw in 2022 because interest rates rose very slightly, but 2023, the interest rates of around 3% to 4%. And that really increased our net financial charges. We move on to the line for financial charges from foreign exchange. So this reflects what we said a little earlier, there was an increase from EUR 84 million to EUR 105 million in foreign exchange losses. This is predominantly from Nigeria for the first half of the year, Kenya as well especially in the first half of the year. Actually, in the second half of the year, the situation actually improved; thanks to what we put in place. So for example, we sought to reduce the dollar debt level that we had locally and we sought to actually shift everything from Schillings inflows into Dollar inflows so that we maintained our debt exposure in dollars. And that is actually -- because we were suffering a strong foreign exchange loss. So EUR 67 million in Nigeria that was offset on to the end clients by increased billing and that is reflected in EBITDA. So we reassessed the situation in June because of the highly volatile early half of the year. So we are in the country, we have business in the country. We have a 45% market share, so that places in leader position, and we have a long-term vision. And I would say that the capacity that we have to be able to push on the foreign exchange risk on to end customers or end clients means that all of our businesses in the country still provide a satisfactory return. So a tough year, but the underlying business is solid. We also have profit before tax EUR 425 million, up 27%. And if we drop down a few lines, we have tax rate that went from 19% to 14% this year. So that drop in tax rates can be explained by the geographic contribution mix. So you have the Caribbean area, which was very very much present in supplies, trading and shipping and present -- and a lot of that was in Ireland states where there is 0% tax. So that's why our tax rate really dropped from 2022 to '23. There was a drop in goodwill as well which unfortunately is not tax deductible. So we had a pinch effect between the -- those 2 effects. So aside from 35% growth of our net income group share, what we would like you to draw your attention to is the 8% of adjusted net income group share because what that reflects, is it correct for a number of one-off items. So these are events that really came through in 2023 and partly in '22. So because of that, we can actually compare both, so we went from EUR 317 million to EUR 342 million for adjusted net income. So when we look at 2022 to 2021, the increase was 10% for adjusted net income. So 10% growth last year, 8% growth this year. So this is always hovering around the double-digit percentage growth. That's it for our financial results and the income statement. I'd now like to quickly talk about our balance sheet. What we see here with our balance sheet is that we have a healthy balance sheet when looking at our consolidated finances. We have a net debt-to-EBITDA ratio, which in 2022 -- end of 2022, was at 2.0x and which is now at 1.8x end of '23 financial year. That's predominantly due to the cash generation over the year. Another ratio we like looking at is looking at non-recourse debt and this is especially what we saw with the renewable energy development. So we had 1.5x to 1.4x which is quite manageable when looking at group level. So that's it for the main changes for Rubis balance sheet. So again, a modest level of debt, mostly liquid -- high level of liquidity in our overall balance sheet with some credit lines that are constantly being renegotiated meaning that we always have some EUR 400 million in available credit lines, so that we can continue to acquire new businesses and further our company's growth.

I would like to just quickly come back for a few final items for the final outlook. So as Jacques and Bruno have already just said, I would just like to congratulate everyone for the fantastic operating performance with adjusted net income up 8%, a 35% increase for cash flow as well, which really attests to the quality of our overall financial results and also attests to our ability to pay a growing dividend. As for our extra financial indicators, we've really been working on ESG-type topics, and that's been recognized by nonfinancial rating agencies. CDP reiterate its B rating for the third year running. Same as MSCI, which continues to give us a AA rating. As for Photosol, now I didn't mention this a little earlier when I spoke about it. We have really started in-depth work on avoided emissions. And this year, we hope to avoid 230,000 tonnes of CO2 for 2023. That's a total of 475 gigawatt hours of produced solar power. So I see as our roadmap will be orbited with 2024 indicators. We'll put that up online on our website. Rubis Photosol will be incorporated in the 2024 road map for the first time. Now moving on to the 2024 outlook. The broad strokes outlook, the key drivers for the year is that, well, we don't expect any main surprises for LPG, be it in Europe or in Africa. As for bitumen, we expect business to stabilize in Nigeria. Other countries are going to continue with a strong positive momentum. In terms of fuels, expecting to grow at a steady pace in Africa, predominantly thanks to our network of service stations and also by growing our non NFRs -- so nonfuel revenues, which is set to increase. Moving into the Caribbean region. So because COVID years, we saw 2 years of high business, we expect this year for that business to return to a more stable level of business. Talking about renewable LNGs and renewable electricity, we expect it to grow in line with our plan. This is probably mainly due to large and small ground-mounted power plants in France. We also have other small power plants for professional clients, again, working with Rubis Energies to roll them out. And we're going to continue to grow business internationally and when I say international I mean mainly in Europe. In terms of risk areas for the coming year, is the ones that we've identified, which may actually challenge some of our estimates. Well, we have sharp exchange rate fluctuations in Nigeria. They've really penalized us in the past and they're hard to predict. We have been able to account for Haiti, hopefully, that will be offset with the rest of the group's business. We estimate that aside from any major deterioration in market conditions, EBITDA for 2024 should sit at somewhere between EUR 725 million and EUR 775 million. Other key features for 2024. We expect that the global minimum tax rolled out by the OECD will be applied. So that will have an impact somewhere between EUR 20 million and EUR 25 million for the group. Now I know many of you are aware of this, but every year, we intend to have our dividend grow yet again. Finally, back in 2023, we announced that we were going to hold an Investor Day, and we are delighted to announce that we are going to have a Photosol Day on September 17, 2024. At the event, we will provide more ample information on the business. I'd also like to take this opportunity as I wrap up this session to introduce you all to Marc Jacquot, who is joining our team as Group Chief Financial Officer and it is a joy to have Marc. So Marc has actually been with us since January and to ensure the transition with Bruno because Bruno will be becoming Chief Strategy and M&A.

Thank you, Clarisse. Hello, everyone. It's a pleasure to be with you here. Just a few quick words. I actually started my career in New York, in investment banking and I joined CGG Corporate Finance in France and then worked for the United States for more than 10 years. I then joined Rubis Terminal as CFO and we set up the joint venture with I Squared-Capital in 2020. And I'm really excited to join Rubis today because it is a group going through fundamental transformation across the board. I'm really looking forward to working with management to push forward all the projects for the coming years. And I really feel a great sense of peace of mind because Bruno will still be there in the company. He's not too far away and are really looking forward to working with everyone in the coming months.

Marc, thank you very much. I think it's now time for Q and A. Good evening, everyone. We have a first round of questions from Jean-Luc Romain, an analyst who's been following Rubis from some time. Four questions. What is residual value in the balance sheet? Final question, are you going to account for the adjustment for HDF Energy? Third question, about Photosol. With EUR 400 million in annual investments, what is going to be the growth of installed capacity year after year? And final question about Ener 5. Can you just provide us a few more details about the Ener 5 acquisition? And what did you pay?

First question about Haiti, what is residual value of Haiti? EUR 120 million in assets, EUR 60 million of which is an acquisition gap. Again, there's a 2023 contribution of just under EUR 5 million in net profit. Again, that was where we've been. In relation to the EUR 6 billion in assets, it's not a huge drop in the ocean and compared to the EUR 350 million in net profit, I think we really need to just bid at EUR 4 million in mind. It's not that big. So that's it for Haiti. Any other questions?

Well, I'll quickly answer the question about HDF Energy. So HDF Energy was an 18% stake that we took out. So it doesn't appear in our profit and loss. It does appear on the balance sheet. And we actually have a strategic partnership with them for all of our geographical zones where we have business. So there's nothing really new there for HDF from Rubis side. So it's hydrogen and electricity from French Guiana, CEOG 30% and HDF [indiscernible] also have share which is currently building that, and that will be commissioned mid-2026. We also have one in Barbados, RSB and it is in a fairly early stage of the project, and we have already secured funding from the World Bank, EUR 41 million. And we're also looking in -- at some EPCs. We've got 25 projects in the pipeline, which should be -- that came through in 2023, but they are going to be in Namibia, Indonesia and Mexico and these are projects for which we didn't want to take out a stake. They've also got an industrial project for factories for fuel cells, and that's currently being built and it should be commissioned mid-2025. So they'll be making their first fuel cells as of then. That's it for HDF. As for Ener 5 question, it's a really small company and they install small solar plants for B2B clients. It's very much like Mobexi. So an acquisition price, which is very low between EUR 2 million to EUR 3 million and really, that acquisition is just to shore up the Photosol acquisition in France. And again, the small solar plant installations require a lot of local presence, so you need local installers, and that acquisition is just so that we can really roll out that business a bit more effectively.

There was just one final question, if we may, about EUR 400 million in annual investments. Just quickly about the HDF and how value is booked. It was actually depreciated because of the stock price evolution since the acquisition, we're about EUR 22 million, EUR 25 million in terms of how -- the value that we booked. Now just quickly answer the question about EUR 400 million in annual investments. I mean this is part of our 2030 plan. So this year, we're going to invest EUR 75 million. Obviously, we -- that investment will increase year after year so that we can reach our 2030 levels. But here, we're talking about EUR 400 million in annual investments will here, we're talking about 400 megawatts in additional power and here, we're talking about installed capacity that will be added into our secured portfolio. So we -- really, we're going to be increasing the annual additional megawatts by about 400 over '26 and '27.

And again, here, when we talk about secured, it's both -- it covers a lot of ground. So it will take time to get that through.

I'd like to add one thing. When [indiscernible] example at the end of my introduction, I was keeping you or showing you an example just to make it very clear what the investment capabilities are in this area without asking for anyone to help and certainly not the shareholders because sometimes the markets tend to be apprehensive in the industry building solar plants, sometimes the market is apprehensive about the need for finding more equity over the years, which is not at all our case because we can finance those EUR 400 million, and I'm not saying we can do it overnight as Bruno and Clarisse has pointed out. Between 2022 and 2026, we had said cumulative EUR 700 million. In fact, this is linked to the growth of our capacities on the French market, which used to be around 2.5 gigawatts -- which according figure, which should double to 5 gigawatts or even 7-gigawatts if we are to follow French and European regulations, which is something that should allow us to grow before the Photosol acquisition. Photosol reached about 300 to 350 extra megawatts a year secured, just to give you an idea.

Next question. It comes from Alexandre Letz, who is the analyst who follows Rubis at [indiscernible] Dupont and he's asking what has driven the gross margins for retail marketing in Europe, the Caribbean and Africa? Well, the drivers were [indiscernible] the behavior of the oil prices, which went down slightly compared to the summits that had been reached in the previous years. And that has obviously meant that the margin situation was rather favorable. That would be my first basic answer. Now in terms of [indiscernible] market, I think we've mentioned the aviation in Eastern Africa, which I mean you have to look at each market. It used to be a very sluggish market in the past few years with many players that, in fact, disappeared. Now we replaced them, but with much lower risks and the margins that we get from this industry or this segment has gone up quite a bit. Now similarly, if you take the Caribbean zone -- in the Caribbean, the margin situation was quite favorable and has been for a long time. And with our logistics tools in terms of transport and shipping, we have access to competitive resources, which also allows us to boost our margins. And lastly, in Europe, in Europe, we are mostly positioned on LPG and free markets in terms of pricing. And here, again, in an environment where prices have gone down compared to previous years, this makes it easier to get good margins.

Any other questions? The next question comes from [ Stephanie Moshe ]. [ Stephanie Moshe ] is asking why we're only or why you're only increasing your dividend by 3% with such good results? Well, there was a question at some point of not increasing the dividend at all. And now we're saying we're increasing it by 3%. Now the adjusted result has gone up 8%, indeed, but you have to keep in mind the fact that the share has a yield of about 8%. So that's pretty high. And we would love it for the market to bring down that yield by boosting the market share. So there's nothing hidden behind this 3% dividend increase.

The next question comes from [indiscernible], who's asking a question about the group's equity, the gearing, the time line for reimbursement and predicted rates for 2024. Well, the equity, you will find it in the balance sheet, EUR 2.8 billion the total equity, including minority shareholders. And the question -- well, the part of the question is about the gearing rate where we talked about EUR 1 billion or EUR 1.2 billion of net debt compared with EUR 2.8 billion of equity. So it's a fairly modest amount. It's much less than 100%. And in terms of the net debt-to-EBITDA ratio, it is also under 2. So that allows us to say that this is a very robust financial situation with a debt situation, which is such the average direction of our credit line is about 3 to 5 years as far as Photosol, the -- a majority of the existing debt is much longer about 20 years originally, but some of it can be amortized year after year. And this is all backed by contracts of the same duration. Now our financial strategy, of course, is focused on protecting the liquidity of our balance sheet by always having available credit lines and renegotiating and finding new instruments that give us access to as long maturity debt as we can access. So those are the directions in which we are going as far as our debt structure.

There's another question about reimbursement and time lines, EUR 450 million must be reimbursed in 2024, which in light of the systems that we have put in place is not problematic. The next question comes from [ Filippe Vida ], who is asking if there are any plans to -- to do share buybacks in 2024?

No, it's -- that's not the case. Nothing of the sort is in our plans. We're doing a bit of it each year, and we have plans for that at Rubis Energie and Photosol as well. So in the current situation, we are now planning to do any share buyback.

The next question comes from Emmanuel Matot, the analyst who follows Rubis at [indiscernible]. He's asking whether we expect to have a stable net result in 2024. And if we have incorporated any ForEx losses, particularly in Nigeria. And then he asked a second question about Kenya, where the government had put in place a subsidy system to cap fuel prices.

As for the first question, I think we answered as part of our outlook document for 2024 saying that it was one of the points that we had integrated into our guidance and that we were very much alert to the situation, which is why we targeted a stable net results or 1 point of increase. We're stable after the impact of the tax situation at EUR 20 million to EUR 25 million. So that's the situation we're at. Perhaps we could specify that we're talking about second pillar, taxes. Yes, and effective in 2024. So the impact -- the estimated impact on the P&L as far as taxes between 2024.

There's another question on Kenya, if I'm not mistaken, and the subsidies there? Yes, subsidies system was put in place in 2022, back when the Kenyan government had abandoned the premium system and that capped the pump level prices, which have gone up sharply. In exchange for that, a subsidy was put in place for oil distributors. A part of it was paid through treasury bonds -- short-term treasury bonds. And so as part of our balance sheet. We have EUR 30 million of treasury bonds with a maturity of 3 years, and the reimbursement will happen gradually over time and will help us [indiscernible] rather reimburse what we owe to the government. As far as the other similar situation. In Madagascar, something similar happened, but the government kept all of its promises and reimbursed the earnings losses that arose from the abandonment of the price structure, all of that money was paid back to us.

It's very interesting, what Bruno has just said because this is something that keeps happening in the energy and fuel distribution and service stations industry in a number of countries that are constrained in terms of their price formulas with regulated price in another words. When international prices go up too high and too quickly and reach the kind of levels that we saw in 2022, clearly, the system can get to a point where it is [indiscernible] and the government will decide to cap the prices, which is problematic to players like us. But over time, over the years, experience has shown us that once the situation goes back to normal, governments will actually indemnify you for the lost earnings and it was -- it was still the case in 2022. 2023 was no different. It is interest -- interesting to note that because it's one of the strengths of this industry, in that, you can really pass on to the market the variations of international prices and where there is a blockage that systematically taken into consideration by countries, and they will make amends for -- the governance will make amends for that as soon as they can usually the next year. Question from [indiscernible], are there still any other acquisition opportunities in Rubis Legacy business? Will you in the years to come, focus on investments and M&As in renewables? Second question is about your assumptions in terms of ForEx in 2024 as part of your EBITDA and net results. And his third question is about Rubis Terminal, wasn't the JV expected to be more aggressive in acquisitions? And how about debt refinancing?

Okay. I'll [indiscernible] your first question. In terms of our legacy activities, you can't really say that we haven't developed or grown. But what we've done these past few years was organic growth through bitumen which is a kind of development and growth that is highly profitable for us and also by developing countries like Guyana and Suriname. And we're really capitalizing on our geographical footprints to penetrate other markets. We've always said that we would -- we've always said that we would consider M&A if the multiples will go -- mainly in Africa of 3 activities, but there won't be any opportunities in bitumen -- it will be organic in bitumen, but on LPG and retail as well as in the Caribbean, whilst at the same time, spending the next years, investing in low carbon energy at Rubis, of course, but Rubis Energie as well. So that we can provide our customers with multiservice, multi-product services, mainly for our industrial and professional customers.

Another question was about ForEx? Yes. On ForEx and currency. We don't have a budget rate in terms of the currencies. We never do it. We never do it simply because our industry allows us to pass on the product's price to the end consumer as labeled in the local currency whether because the price is free for the distributor or because there's a price mechanism system in place [indiscernible] the depreciation or appreciation of the currency as part of that formula, which is [indiscernible] budget in terms of currencies. We look at the currencies as they are. And then we pass on to the end consumer, the real price of product, which, of course, takes into consideration, the depreciation or appreciation of the local currency.

Other questions about the terminal wing. Yes, Rubis Terminal. I think the question was about being more or less aggressive in acquisitions. Yes, it is a fact that since we built the Spanish company of [indiscernible] beautiful companies that led to a 30% rise of the value of Rubis of the company that bought it, we haven't renewed any such large acquisitions, but we have grown a lot in Rotterdam and France. And at the end of the day, in this industry investments, it doesn't -- arbitration between construction from scratch and acquisition and the growth of Rubis Terminal is fairly remarkable because it's been interrupted even throughout COVID years and it was still very strong in 2023. And I keep saying it's a great industry because when the economy is going well, the volumes higher -- the volumes rise and the economy is not doing so well, clients need to make stocks. They need to store energy.

In Rubis terminal, we are looking at this potentially EUR 100 million acquisition in the south of Spain, in the area of green ammonia, which will be made with solar plants that would build the kind of energy that is needed to produce ammonium and then ship it to the north of Europe. So it's -- so it would be a large project, one of the largest in Europe, in fact. Still on Rubis Terminal, what is the residual value of the 55% of the Rubis Terminal JV? And has that value been recessed since it was sold to I Squared? And I'm getting another question from Jean-Luc Romain about the leverage at Rubis Terminal. Well, the debt levels of Rubis Terminal was about EUR 650 million at the end of last year. Well above the maximum leverage as stipulated in the financing contract which would be 6x. We're at 4.5x because we're not using the whole of the leverage. So that means we still have a major ability to releverage if needed, by distributing dividend or by acquisition. The 2022 refinancing exercise was very fair to us in that it really allowed us to bring down the interest rates. And right now, we have a [indiscernible] 4% when we used to be at 5.6% in the past or high yield, in other words. So yes, this instrument gives us all the flexibility we need to manage the Rubis Terminal balance sheet, who's value is booked in Rubis from an accounting point of view, we don't reassess if we can readjust it down, but we didn't readjust up, it's very basic principle of accounting. But the amount that is asked for is booked or add to EUR [ 80 million.]

Any other questions?

No, I'm not getting any other questions. We're very glad that we have been able to answer your questions. Thank you very much for spending time with us, and we really hope to see you soon on the next opportunity so that we can continue to present our group and convince you that we, ourselves, are convinced it is -- it has a great potential for value creation. Bye.