Sembcorp Industries Ltd (U96) Earnings Call Transcript & Summary

Ladies and gentlemen, good morning, and welcome to Sembcorp Industries Full Year 2022 Results Presentation. A warm welcome, too, to viewers tuning in via the webcast. I'm Xin Jin from Group Investor Relations. Before we begin, we would like to request for all mobile phones to be turned off or switched to the silent mode. If you feel unwell, do approach our staff assistance. Thank you. The members of the panel for today's presentation are Group President and CEO, Mr. Wong Kim Yin; and Group CFO, Mr. Eugene Cheng. [Operator Instructions] Without further delay, I will now hand over the time to Kim Yin to begin the presentation. Kim Yin, please.

Good morning. Very happy to see all of you, very familiar faces, all friends. Welcome to Sembcorp Industries Full Year 2022 Results Briefing. The group delivered a strong set of results for 2022 amidst a volatile market. Turnover was SGD 9.4 billion, 21% higher year-on-year. EBITDA and Adjusted EBITDA was SGD 1.7 billion and SGD 1.9 billion, respectively. Net profit before exceptional items was SGD 883 million, this is an increase of 87%. Net profit was SGD 848 million. Earnings per share, SGD 0.476. Earnings per share before extraordinary items was SGD 0.495. Group ROE was 21.9% and group ROE before EI was 22.7%. The financial figures mentioned include discontinued operations. This is for easy comparison against last year's results. This will be different from the financial statements at Sembcorp Energy India Limited or SEIL, this has been classified as discontinued operation and deconsolidated. Given the group's strong operational results, the board is proposing a final dividend of SGD 0.04 and a special dividend of SGD 0.04 per ordinary share for FY 2022. Together with the interim dividend of SGD 0.04 paid in August 2022, this will bring our total dividend for the year to SGD 0.12 per ordinary share and this is an increase of 140% from the SGD 0.05 in 2021. During the year, we have made significant progress against our strategic goals. Our renewables portfolio grew significantly with a 60% year-on-year increase in capacity to 9.8 gigawatts, and this is through organic growth as well as acquisitions. We also successfully commissioned Southeast Asia's largest energy storage system, and that was done in 6 months in Singapore. For the Integrated Urban Solutions segment, we achieved a higher order book in 2022. We extended our lead in Vietnam's industrial park development sector with licenses secured for Quang Tri Industrial Park, VSIP Binh Duong III, VSIP Can Tho and VSIP Nghe An park II. In the Conventional Energy segment, we completed the sale of Sembcorp Energy India Limited, SEIL, which operates 2 supercritical coal-fired power plants in January 2023. This marked an important milestone in our Brown to Green portfolio transition. Now as part of our ongoing efforts to decarbonize, we also expanded our strategic partnerships with various corporations to progress hydrogen and other decarbonization initiatives. Since the launch of our green financing framework and sustainable financing framework in 2021, we have received strong support from investors and successfully raised SGD 3.3 billion of funding from green and sustainable financing as far as refinancings. The funds continue to support the group's transformation and our pursuit of growth plans in the Sustainable Solutions segment. So allow me to go through the key highlights of each business segment. The Renewables segment delivered a strong performance with net profit before exceptional items, increasing 150% to SGD 140 million in 2022 and this is up from SGD 56 million in 2021. This was driven by contributions from SDIC New Energy and Shenzhen Huiyang New Energy, HYNE. The solar assets in Singapore also performed better on higher power prices. Net profit after EI was SGD 132 million, up 136% from SGD 56 million in 2021. In 2022, we made strides in growing our portfolio, adding 2.4 gigawatts of renewables from acquisitions and 1.2 gigawatt from organic growth during the year. This brings the total gross renewables capacity to 9.8 gigawatts, which is very close to our target of 10 gigawatts in stock renewables capacity by 2025. Apart from growing our renewables portfolio, we entered into strategic partnerships with Japan Bank for International Corporation, Sojitz Corporation, IHI Corporation and is to progress hydrogen and other decarbonization initiatives. In addition, we are advancing our collaboration with Mitsubishi Corporation and Chiyoda Corporation with the commencement of the pre-FEED studies for the development of hydrogen imports via meta cyclohexane, a type of liquid organic hydrogen carrier into Singapore. The partnerships forged aligned with our brown to green transformation and will enable us to play a pivotal role in the development of hydrogen as a major decarbonization pathway in the long run. And complementing Sembcorp's offerings as a leading renewables player, we launched GoNetZero, our Carbon Management Solutions corporate venture at the 27th United Nations Climate Change Conference. GoNetZero offers one-stop access to renewable energy certificates and carbon credits as well as renewable energy and environmental attribute portfolio management. We are pleased to announce collaborations with leading industry players such as OCBC Bank, Razer and UBS during the launch. This slide shows a little bit more details on the renewables portfolio. Our gross renewables capacity, including acquisitions, pending completion has more than tripled to 9.8 gigawatts over the past 2 years. The proportion of renewables capacity in our group energy portfolio has increased meaningfully from 25% to 59%. We make good progress and gain momentum in our growth areas and our growth markets. In December 2022, we successfully commissioned Southeast Asia's largest energy storage system of 285-megawatt hours on Jurong Island in Singapore. This facility will enhance grid reliability and energy supply security. It also demonstrates our ability to replicate our capabilities from the U.K. to Southeast Asia. In addition, our solar portfolio in Singapore is now 551-megawatt peak, including the award of SolarNova 7 project. This portfolio contributes to more than 1/3 of the nation's 2025 target of 1.5 gigawatt peak. In Vietnam, we acquired a 49% stake in Bamboo Capital Group, GAIA, our first utility scale acquisition in the country with 141-megawatt peak of operational solar capacity. Our experience and presence in Vietnam has put us in good stead to capitalize on opportunities when they arise. In China, we strengthened our presence and successfully completed the acquisition of a 35% stake in SDIC New Energy and a 98% stake in HYNE Huiyang. Since then, SDIC has also grown organically by another 290 megawatts. In November 2022, we announced 2 other acquisitions in China. First, 795 megawatts of solar assets through a 49% owned joint venture with Beijing Energy Sembcorp Hainan International Renewables. And second, 892-megawatt portfolio through a 45.3% stake in Hunan Xingling New Energy in China. Hunan Xingling New Energy has since completed the acquisition of 792 megawatts out of the 892-megawatt portfolio from Wuling Power with the remaining 100 megawatts expected to be completed in the first half of 2023. These projects expand our geographical footprint in China and the partnerships provide platforms for us to jointly pursue further renewables opportunities. In India, we're also very pleased to have completed an acquisition of 100% interest in Vector Green, which holds 583 megawatts of renewable assets. The portfolio brings significant utility scale solar capacity to our India business, complementing our existing wind portfolio. This broadens and deepens our renewable energy presence across the states in India and positions us for more green growth in the country. In addition to the acquisition of Vector Green, we secured a further 195 megawatts of renewable projects in India during the year despite competitive market conditions. And last but not least, in the U.K., we commissioned another 50-megawatt hour of our battery energy storage portfolio in July 2022, bringing our operational energy storage fleet to 120-megawatt hours. We also began development of the first tranche of 150 megawatts or 300-megawatt hours of battery storage as part of a planned 360-megawatt battery storage system on Teesside and secured a 15-year capacity market contract for these assets. These batteries are expected to be completed in 2024, further enhancing our presence in energy storage in the U.K. The Integrated Urban Solutions segment delivered a net profit before EI of SGD 148 million compared to SGD 155 million in 2021. In the urban segment, lower land and property sales in China was mitigated by a strong demand in Vietnam and higher sales margin in Indonesia. Our waste-to-energy plant in the U.K., Wilton 11 which serves our industrial customers on Teesside, performed better due to higher power prices. Net profit after EI was SGD 140 million compared to SGD 161 million in 2021. We have received investment licenses to develop 4 other industrial parks in Vietnam and now have 16 urban projects strategically located across Vietnam, China and Indonesia. These parks provide platforms to leverage our business synergies and drive future growth in sustainable solutions. In March 2022, we began the development of VSIP Binh Duong III, which is ambitioned to be the model of a smart and sustainable industrial park. A distinguishing feature of VSIP Binh Duong III is its planned 50-hectare on-site solar farm, offering great reliability and sustainability benefits to its industrial tenants. LEGO Group has begun construction of its first carbon-neutral factory in VSIP Binh Duong III, which is planned to be powered by renewable energy drawn from the solar farm installed by VSIP as well as solar panels installed on their sites. As an expansion of our product offerings, we started the development of Sembcorp Logistics Parks in Quang Ngai and Nghe An in the provinces of Central Vietnam. Totaling 76,000 square meters in gross floor area, this modern ready built warehouses provide quality logistics spaces in strategic locations to manufacturers. Construction will be completed in the fourth quarter of 2023. Now we move on to Conventional Energy. The Conventional Energy segment delivered a strong performance in 2022. Net profit before EI was SGD 766 million, up 105% from SGD 373 million, driven by higher power prices in Singapore and the U.K. as well as gains from favorable gas hedges. This was partially offset by SGD 84 million expected credit loss provision for Sembcorp Myingyan Power Company receivables. Net profit after EI was SGD 766 million from SGD 174 million the year before. A major milestone in our brown to green transition this year was the completion of the sale of SEIL, Sembcorp Energy India. The transaction structure was developed in accordance with the strategic commitments we have communicated and will preserve value for shareholders as well as protect the interest of SEIL's many stakeholders. We will continue to support SEIL's operational excellence and initiatives to decrease its greenhouse gas emissions. And this is done through a technical service agreement. To underscore our commitment to sustainability, we have also provided a financial incentive that rewards a reduction in emissions intensity. To diversify our sources of gas, we signed a supply agreement with Total Energies to import LNG into Singapore for 5 years starting from 2025. This is Sembcorp's largest LNG contract signed to date, and it will augment our energy generation sources and supplies in Singapore. This slide gives a snapshot of our progress against the strategic targets that we have explained to you in 2025. So in the year 2022, sustainable solutions comprising the Renewables and Integrated Urban Solutions segments accounted for 27% of group net profit compared to 35% as at the end of 2021. Despite the decline, it is important to note that the sustainable solutions portfolio performed well, with net profit growing at a compounded annual growth rate of 35% since 2020. However, we also saw a strong earnings contribution from the Conventional Energy segment, which led to it being a bigger contributor to group net profit. In terms of our renewables target, we have achieved 8.3 gigawatt of gross in-stock capacity and a further 1.5 gigawatts of gross capacity under development. We are close to our target of 10 gigawatt gross in-stock renewables to be achieved by 2025. And we continue to look for opportunities to grow this portfolio. Urban land sales in 2022 was steady at 172 hectares, and this is despite a weak property market in China. 2022 order book was higher also at 312 hectares compared to 279 hectares in 2021. We will and must continue to focus on growing our land bank to ensure a steady launch pipeline. With the divestment of SEIL, we have met our 2025 carbon emissions intensity target well ahead of time. Excluding SEIL, 2025 emissions intensity, Scope 1 and 2 were reduced to 0.31 tonnes of carbon dioxide equivalent per megawatt hour. Absolute emissions for Scope 1 and 2 will decrease to 10.4 million tonnes of carbon dioxide equivalent in 2022. We will continue to actively explore options to reduce our absolute emissions to achieve our 2030 and 2050 targets. Our focus on execution has yielded results. And we have made very good progress in our Brown to Green transition in less than 2 years. While the global economic outlook remains uncertain, the opportunities ahead are significant. With our capabilities and track record in energy and urban development, we believe we remain well positioned to seize opportunities in this transition. Given the strong growth momentum, we are looking beyond 2025, and we'll communicate our refreshed strategy and targets to shareholders and investors later this year. Let me now hand over to Eugene, who will give you more details of the group financial review. Thank you.

Thank you, Kim Yin. Now as you have heard Kim Yin mentioned earlier, for this particular year, our group financials, as you will find in the SGX that is presented slightly differently where the discontinued operations, which represents SEIL's contribution for the year is represented as a single discontinued operations, net profit contribution, right? So this particular slide helped to detail from a line-by-line basis, the continuing operations and the discontinued operations as a comparison. Within the SGX net, you can find more details in relation to the discontinued operations under Note 7C. So I'm pointing that out for those who would read the SGXNet to make it easier for you. And essentially, the discussions in the following slides will be with reference largely to the continuing operations. Now if we move on to the next slide. Now as Kim Yin has mentioned, for FY 2022, we have achieved a set of strong results. When we look at our turnover from continuing operations, it has increased 22% from SGD 6.4 billion to SGD 7.8 billion. And as a result of that strong operational performance, our EBITDA has also correspondingly increased by 48% from SGD 885 million the year before to SGD 1.3 billion this year. The key contribution to the increase in turnover and EBITDA is largely driven by the strong performances in the Conventional Energy segment as well as the growth that was achieved in the Renewables segment. Share of results of associates and JVs net of tax has increased 20% from SGD 206 million the year before to SGD 248 million. And this improvement is largely due to the contribution from the 35% owned SDIC new energy portfolio, which was acquired and completed in January of 2022. Now the combination of the EBITDA performance as well as the share of results performance then resulted in a 43% increase in our adjusted EBITDA to SGD 1.6 billion for FY '22 compared to approximately SGD 1.1 billion for FY '21. Net profit from exceptional items then grew 129% from SGD 323 million the year before to SGD 739 million this year, again as for the reasons mentioned earlier on, largely through the completion of our renewables acquisitions as well as much stronger earnings in the Conventional Energy segment. Exceptional Items in FY '22 totaled SGD 35 million for the items that was mentioned earlier by Kim Yin. And this is a significant reduction from the SGD 193 million in FY 2021, which largely came across as a result of the impairment of our China Songzao asset. All in all, our net profit from continuing operations is SGD 704 million compared to SGD 130 million in FY 2021. And our total net profit for the year is SGD 848 million compared to SGD 279 million. Total net profit for the year in FY 2022, once again to reiterate, excluding exceptional items, would have been SGD 883 million, as highlighted earlier on. So from an earnings per share perspective, EPS before exceptional items from our continuing operations is SGD 0.415 compared to SGD 0.181 the year before. On EPS, taking into account exceptional items is SGD 0.395 compared to SGD 0.073 the year before and ROE from our continuing operations is 18.2% compared to 3.7% the year before. Moving on to the next slide. This slide details the turnover breakdown as well as contribution from the key segments of our business, particularly within the continuing operations. Just want to mention that the renewables segment saw a 43% increase in turnover. And for, as highlighted earlier on, it's largely due to the completion of the acquisition of the HYNE portfolio as well as higher energy prices that was realized for our solar operations in Singapore. In addition, we also have an additional 50 megawatts of contribution from our SEUK batteries that came online in August of 2022 that will continue to contribute on a full year basis in FY 2023. Now the integrated urban solutions saw a slight decline in revenues, and this is largely due to the cessation of a public waste collection contract in the Singapore Waste Management business. Now the bulk of our Urban Solutions earnings have contributed at the associate level, and so I'll touch on that in a slide subsequent to this. But all in all, turnover from our Sustainable Solutions segment is SGD 950 million compared to SGD 819 million the year before, representing a 16% increase. In the conventional energy, turnover increased by 24% to SGD 6.5 billion from SGD 5.3 billion the year before driven largely by the strong power price and demand performance, particularly in the Singapore and the U.K. Other businesses saw a 10% increase in turnover to SGD 328 million, and this is largely a result of higher volumes of projects from our Sembcorp Specialized Construction business. When we look at the breakdown of our group net profit for FY 2022 compared to FY 2021, as mentioned earlier on, we have seen the renewables segment contribute SGD 140 million, representing a 150% increase over for SGD 56 million that was seen in FY 2021. This SGD 140 billion in net profit for the Renewables segment largely benefited from 11 months contribution from SDIC and 7 months from HYNE. On a full year basis, on a run rate basis, assuming that SDIC and HYNE have contributed on a full year basis, that SGD 140 million would have been about approximately SGD 166 million. Now the Integrated Urban Solutions segment from a net profit perspective also saw a slight decline. And the large -- this is largely a result of the one -- having a one sector less in Waste business, also lower land and property sales in our Urban business as a result of a slowdown in China, but this has been partially mitigated by higher earnings from Wilton 11 in the U.K., which is our waste-to-energy plant that has benefited from a stronger price performance. All in all, net profit contribution from our Sustainable Solutions segment was SGD 288 million, a 36% increase from SGD 211 million the year before. The conventional energy segment turned in SGD 622 million in net profit, which represents a 115% increase from SGD 289 million the year before. Now this SGD 622 million has been achieved as a result of strong performances, largely from higher power prices in Singapore and U.K. and also benefiting from the fact that we have a diversified portfolio of gas in Singapore that allow us to optimize our spark spreads. Now this has been partially offset by an SGD 84 million ECL, expected credit loss provision that we have taken for our Myingyan asset, which I will quite painstakingly explain in the slide after because some of you may be wondering how that came about. Now Other business, net profit contribution has remained rather stable, SGD 23 million compared to SGD 25 million. And from a corporate cost perspective, largely at similar levels as well. Now when we factor in the effects of exceptional items, directionally, right, the numbers represent the factors that I've discussed on a before exceptional items basis. Now, I just want to move on to the next slide, which shows the net profit bridge between the FY 2022 and FY 2021, right? Now for renewables segment, when we look at FY 2021 net profit before EI of SGD 323 million, the Renewables segment contribution growth largely came as a result of the completion of our acquisitions and also stronger solar prices for our solar operations in Singapore. The Integrated Urban Solutions, as mentioned earlier on, slightly lower earnings as a result of slower land sales as a result of China slowdown, loss of a sector in [indiscernible] business, offset by stronger performance for Wilton 11. Now for the Conventional Energy segment, okay, the outperformance is really stronger fuel prices and spreads and margins achieved. Now I just want to talk a little bit about this SGD 84 million of expected credit loss provision which is onetime in nature that we had to take and is noncash for Myingyan. Now if you recall, our Myingyan is really a gas-fired power plant incepted in Myanmar in 2018 with a long-term concession with EPGE, which is the national power company. Now as a result of the nature of the contract, instead of accounting for the Myingyan power plant as property, plant and equipment and recognizing receivables as generation occur, the entire concession contract was recognized as one single large service concession receivable as a result of IFRIC-12 accounting, right? And that service concession receivables total an amount of close to SGD 260 million. Now because it is a service concession receivable, SFRS 9, which is the accounting standards for accounting for financial assets is applicable in this situation. And at the end of each financial period, we are to assess if there is a significant increase in credit risk based on circumstantial as well as macroeconomic situations to estimate if expected credit losses on that basis, pretty much what a bank would do looking ahead for the asset. So when we review the credit and economic situation surrounding Vietnam, a few things we noted have taken place across 2022. There were currency controls put in place in the first half of the year, although none of them were applicable to Myingyan as an essential services. We continue to receive U.S. dollars even up to this date. Now as we progress through 2022, certain developments continue to take place in Myanmar and one meaningful one was Myanmar being placed on the black list so-called of the Financial Action Task Force, and that is typically -- potentially could be a signal for increased risk of economic and financial sanctions. When we look into January this year, we did notice that certain Myanmar entities faced increased sanctions that is in the news. We did see certain officials in MOGE being sanctioned and a couple of Myanmar SOEs, which are mining companies -- mining companies 1 and 2 face sanctions. So while although as of now, operationally, the gas plant being one of the, if not the most efficient gas plant in Myanmar, still generating and still receiving payments up to January of this year. Taking into account of all the factors under the requirements of SFRS-9, we did have to come to the conclusion that there was a significant increase in credit risk surrounding Myanmar as well as the counterparty. As a result, we took a reference to credit ratings of Myanmar, cross-reference against a probability of default rates with those ratings on a lifetime basis that are typically put out by the ratings agencies and that ultimately size our additional ECL provision of SGD 84 million. Now I just want to highlight this point because it really came about as a result of how the Myingyan investment has to be treated on our books as a IFRIC-12 service concession receivable. And as a result, SFRS-9, which lead to expected credit loss provisions on a look-forward basis have to be applied. It is noncash in nature. And from an operations perspective, as of now, the asset is still receiving payments for generation as recent as of January of 2023. So I just want to highlight this element in relation to conventional energy segment. There may also be a question as to why this SGD 84 million has not been treated as an exceptional item. Now if you look at it historically, what we have treated as exceptional items are either impairments or gains or losses from monetization of investments. And we -- given that we have consistently applied the definition of exceptional items in this situation, while it is a onetime ECL provision, it doesn't fall into how we have consistently applied the exceptional items. And that is the reason why this SGD 84 million is not treated or not disclosed or classified as an exceptional items. Happy to take more questions later on, but essentially, I just want to explain this situation. SGD 84 million noncash ECL provision as a result of our application of SFRS-9 on the service concession receivables. Now then if we touch on corporate, as mentioned earlier on, not much of a significant change compared to last year. Now if we move on to the next slide. Now this slide details our group ROE from our continuing operations. From the Renewables segment, ROE stands at 10.2% compared to 4.6% a significant part of it as a result of the completion of the HYNE as well as SDIC portfolios and also the continued generation that come through assets maturity. Now I just want to highlight 10.2% ROEs on the basis of 11-month contribution by SDIC and a 7-month contribution by HYNE, assuming both are at run rate, the ROE would have been 12%. The Integrated Urban Solutions saw a slight decline in ROE also for the reasons mentioned earlier on, essentially, the loss of that sector in and also a slowdown in the China property market that -- sorry, that was offset by higher energy prices that was realized for Wilton 11 waste-to-energy plant. At the Conventional Energy segment, a very strong ROE of 34.8% in FY 2022. Now our ROE, which is the table below that, represents ROE, including our exceptional items, but pretty much paint a similar picture. Moving on to the next slide, just to touch on a little bit about our group capital expenditure as well as equity investment as expected, the bulk of our CapEx and capital allocation in FY 2022 has been into the Renewables segment. SGD 1.6 billion of our total CapEx was allocated into the Renewable segment, which you would have seen resulted in the strong growth, both in capacity and also in earnings to come. Approximately 8% to 10% of the CapEx was allocated towards Conventional Energy, but largely for maintenance purposes and our business as usual pretty much in line in the 5-year guidance that we have shared with the market. The next slide highlights our group free cash flow. Given the strong performance, our operating cash flows was close to SGD 1.7 billion compared to SGD 1.2 billion in FY 2021, representing a 36% increase. Correspondingly, our free cash flow also improved SGD 1.8 billion compared to SGD 1.3 billion the year before, representing a 36% increase. Moving to group borrowings. For the year ended 31st December 2022, our gross debt has reduced to about SGD 7.1 billion compared to SGD 7.4 billion as of 31st December 2021. Of course, this came as a result of the deconsolidation of SEIL from the balance sheet. If we had included SEIL borrowings for 31st December 2022, that would have been SGD 8.2 billion and the increase of roughly SGD 800 million to SGD 900 million is largely for the funding of -- the consolidation of debt at the HYNE portfolio level as well as the funding for the equity contribution for HYNE as well as SDIC as we closed those acquisitions. But if we focus on December 31, 2022, what does the rest of our credit metrics look like. Our debt-to-EBITDA would have been at 5.4x and a debt to adjusted EBITDA 4.5x. If we take into account the cash and cash equivalents of close to SGD 1.3 billion that we have on our balance sheet, net debt to EBITDA would have been 4.4x and our net debt to adjusted EBITDA at 3.7x. Our EBITDA to interest also has improved on a year-on-year basis to 4.2x and adjusted EBITDA to interest 5x. So when we look at our group debt portfolio, from a Maturity Profile standpoint, as you will recall, over the past 2 years, we have taken a quite a lot of focus in, number one, raising longer-term ESG-related financing to fund growth as well as to term out certain refinancing of debt that was due. I'm quite pleased to say that currently, looking at the debt maturity profile, it has been pushed out into the longer term. We still have about SGD 2 billion of debt that is coming due in the next couple of years, but we are working on the refinancing and access to capital would not be a problem. I also want to highlight and talk about our borrowing profile, as you have heard me mention at the start of our execution of this 5-year plan. One of the key elements would be to reduce our reliance on project finance loans and to increase a corporate level borrowings, particularly in the green and sustainability linked space. So we are quite pleased to say that looking at our borrowing profile today, right? Project finance loans comprises only 16% and corporate debt comprises 84% of which half of debt represents green and sustainability-linked financing. We have come a long way in the ESG financing space, being able to raise SGD 3.3 billion over the last 24 months. Now looking at our interest rate exposure profile. Right now, 66% of our debt profile is fixed and 34% of it is floating. Now this compared to -- in 2020, we have focused quite a lot on fixing our debt portfolio. Back in 2020, only 37% of our portfolio was fixed. And we have quite -- over the past 2 years focused on fixing the portfolio to 66%. Of course, going forward, in the current environment, we will still be focused on increasing the fixed rate proportion of our portfolio with an intended target of 75%. When we look at our weighted average cost of debt, average across FY '22, we see a marked reduction compared to FY '21. We have brought our weighted average cost of debt down to 4.1% and a lot of it contributed by the more cost-efficient green financing that we are able to raise. But having said that, we do know that base rates are increasing, particularly through FY 2022. The fourth quarter weighted average cost of debt for us increased a little bit to 4.4%. So as we -- in the rising interest rate environment, while we have achieved a good result of 4.1% for FY 2022, we do have to note that going into FY 2023, it is still a rising interest rate environment. The advantage that we have is that we still could focus on tapping green sources of financing and are being able to focus on managing our margins and spreads. And right now, our weighted average debt maturity stands at 4.5 years compared to 4.8 years before. And that reduction in the debt maturity profile, largely is in part due to the deconsolidation of SEIL's debt, which is project finance in nature and are longer term on average in nature. So when we look at the group's liquidity position, right, when we look at 31 December of 2022. I'm quite pleased to say that from a committed dry powder standpoint, we have cash and cash equivalents of SGD 1.3 billion as well as a committed unutilized revolving working capital facilities of SGD 2.4 billion, which means that at this point in time, we have ready to deploy a short notice, SGD 3.7 billion of dry powder to allow us to continue to capitalize on any opportunities that become due. We do have a further additional SGD 2.5 billion of uncommitted facilities and SGD 912 million of unutilized trade-related facilities. So good liquidity position. So in summary, just want to take us through the outlook statement that we have placed up. We acknowledge that in 2022, we have performed exceptionally, particularly driven by the strong performance in the Conventional Energy segment right on the back of good power prices that was realized in Singapore and the U.K. as well as increased capacity in the Renewable segment. When we look forward, we do expect the Renewables segment to grow, right, as a result of contributions from acquisitions that we had announced, particularly towards the end of 2022 and also full year contributions of the ones that we have closed earlier on in the year. Now the Urban business will continue to secure our land bank and to ensure that we have a steady land pipeline to realize the earnings from the land sales. And we do expect that the performance of the Conventional Energy segment to potentially be subject to energy market conditions. We do want to highlight that our SEIL transaction was completed in January of 2023. So in 2023, we would be recognizing the income from our deferred payment node. There are still certain macroeconomic headwinds that persist which comes through in the form of interest -- heightened interest rates as well as possibly elevated inflation that may weigh down on global demand and also, of course, further escalations in geopolitical tensions could potentially disrupt supply chains and impact business performance. But all in all, the group will still continue to focus on execution of our transformative strategy and will leverage on our energy as well as urban development capabilities to continue to cease and drive growth and capture opportunities in this global energy transition. Now to end of my segment, I just want to point out a couple of developments to note, right? Something that you -- first point is something that you already know, our power purchase agreement of Phu My 3 power plant in Vietnam will expire in the early part of 2024. We will continue to monitor the development in Myanmar closely, right? Post the ECL provision of USD 78 million pretax, our net book value of Sembcorp Myingyan Power Company as at the end of December, still stands at USD 49 million and USD 205 million of the project loans remains outstanding backed by a corporate guarantee that is issued by Sembcorp Utilities. Now I just want to talk a little bit about our sale of SEIL given the fact that we have completed the sale. I am happy to share the results of the completion of that sale. Now I just want us to focus on the upper half of the table, right? In June 2022, we have guided the market that are based on the estimation of our net consideration and the carrying value at that point in time. We had expected a slight loss before the realization of flushing out of our foreign currency translation reserve and any other capital reserve in our books relating to SEIL. Now taking into account those reserves position as of 30th June 2022, there was a slight excess or gain from the disposal of SGD 11 million. Now when we fast-forward that to 19 January this year, when we look at it from a pure transactional or cash perspective, right, we were able to realize a SGD 47 million gain. Now -- but given accounting considerations, we will have to -- similar to the calculation in June of 2022, we would have to flush out the reserves that are related to SEIL in the balance sheet into the P&L before taking it back into equity again. What I want to point out is that when you look at the realization of our foreign currency translation reserve, the FCTR, over the course of the last 6 months, particularly in the last quarter, our foreign currency translation reserve has, in general, moved against us. Now for people to understand, the foreign currency translation reserve measure the difference in the exchange rate on a balance sheet date against the date in which the assets have been booked at historical cost within our balance sheet. So if you look in our SGXNet, you will notice that in the second half of this year, right, we have a significant negative movement of foreign currency translation reserve, firstly as a result of the Indian rupees, particularly in the fourth quarter towards the end of the year and also the renminbi, which currently has since recovered a bit. Given that situation, right, the cumulative foreign currency translation reserve in relation to was SEIL was SGD 418 million at the point in time of completion of the transaction. So as a result of that, taking into account of this movement, on completion, the gain loss of the SEIL transaction has resulted in an SGD 81 million loss largely as a result of the foreign currency translation reserve movement. Now I just want to highlight that actually, there is no real impact to the net asset value of the Sembcorp Industries because the FCTR has already been recognized in the FCTR reserve and for the purpose of accounting for the completion of this sale, it is moved from the FCTR reserve into the P&L and then back into equity. I just also want to highlight that this foreign currency translation reserve of SGD 418 million is noncash and it is largely a translation reserve to measure the difference between the exchange rate at the point of the balance sheet date and when the assets were recorded as historical costs. So I just want to end my presentation on that note to give a highlight of some of the developments that management continue to monitor, and that is coming up. So I'll end my segment, and we're happy to take any further questions from the floor.

[Operator Instructions] First question from the floor. Zhiwei, please.

Zhiwei From Macquarie. I have 3 questions. Two on Conventional and one on Renewables. The first question is regarding your electricity pool trading in Singapore. Was it a significant contributor to your second half '22 earnings? And how does it compare half-on-half, right? And when we think about it, FY '23, what proportion of your second half figures should be considered as sustainable, right? Second question on conventional energy relates to your EBITDA margin. I know that has improved on a half-on-half basis. You mentioned that your diversified gas business has kind of helped with your spark spread. So how sustainable are these margins going forward? Now on the third question on Renewables. When I look at your [indiscernible] factors for your renewables in India and China, SGI seems a bit weak. Are there any other assets in your Renewables portfolio that is not performing to your expectations? And what are you doing to address them?

So I think in terms of the pool contribution for the second half of 2022, as you have recalled, largely from management of our Singapore assets, roughly 2/3 of our assets are contracted, right? So we tend to leave one asset free to either serve as backup to either generate into the pool or potentially we can also monetize our gas positions for them. So I would say that from a second half perspective, it is largely on that basis, roughly about 1/3 of the capacity. It's running on pool. Now in terms of the EBITDA margins, that is realized for the conventional market in the second half, we did saw a strong performance that is coming through, right, as a result in the earlier part of the second half overall from the portfolio. Now you have also heard me mention before that through FY 2022, we will continue with the strategy of really keeping at least 2/3 of our capacity contracted, right, going into -- covered by 1 to 3-year retail contracts going into FY 2023. Now our gas positions also -- when we have secured the gas positions coming into Singapore, we will also hedge off any indexations that is exposed. So from that perspective, from a margin standpoint, right, we do see going to FY 2023 fairly stable. Now the last point in relation to the Renewable segment, I think we just have to take note that particularly in the second half of the year. Generally, we do hit certain parts of a low wind season. Now in India itself, particularly in we are hit with some low wind. So as a result, probably that may be the reason why you see some lower plan load factors contributing in the second half.

Your other portfolios in, say, China, was there any weaknesses in POF you saw sequentially down half-on-half?

Yes. So even in the second half for the China Wind portfolio, right, there is also typically some seasonalities, right, that we see low wind in the second half as well for the China portfolio, which is also a trend which we have seen in the past years as well.

So I think that what we -- from our perspective, wind is wind, right, sometimes blow, sometimes doesn't. What we want to make sure is that when it blows, the plant is up. So we are happy to -- maybe happy is not the right adjective. But when we look at the softening front load factors across the portfolio, the reason for it softening wasn't because the plant was down. I think that is the important thing to note. And then as we grow with a bigger portfolio, it tends to hopefully have a portfolio effect or more diversification. What we want to make sure, again, and emphasize that we want to satisfy ourselves that front load factor down -- it is because of wind. It's something that we have to deal with. But if this is because of our own operation issues, then we have a program, right? So at least what we observed in the last year, it wasn't because of -- largely not because of our plant not being available. So is that your questions are dealt with, are you happy with them.

Next question, please.

[indiscernible] And I must admit, this is the first time I'm really looking at Sembcorp. So how should we think about the outlook of the power in Singapore in this coming year, given that we had a huge upswing in costs last year? Because that's 1 question. And also, how should we think about the outlook for the cost of debt? I think the CFO, you said that you have about SGD 2 billion to refinance in the next 2 years. So what was like your exit cost of debt like? And what do you think is likely to be this year? And based on that, I guess, there will be an impact on your ROEs and the returns that you'll get from your assets. The other question is regarding SEIL, how should ESG -- people who look at ESG, think about the cash flow that comes back on your deferred payment note because it's -- is it Scope 3 or whatever that is likely to be brown? I'm not quite sure how that works. Yes. So those are the 3 questions.

Eugene, why don't I answer the first one, then the cost of debt and SEIL, Scope 3 you can answer. On the Singapore market, what folks on the street experience is the retail energy prices, right? And retailers, including Sembcorp Power would retail power to you. They are getting -- their costs is mainly based on the wholesale electricity market. Wholesale electricity market is a function of demand and supply -- the supply being the power generation businesses, right, the gencos. And the gencos derive the power, providing the supply into the wholesale market, via natural gas largely, right? Maybe I don't on what's the right number now, probably 95% that goes into a wholesale market is from natural gas. So -- and natural gas come from 2 sources. Piped natural gas as well as LNG, right? And as you know, with what's happening in the international gas markets, partly driven by Ukraine and all that, last year, we saw a lot of volatility and high gas prices in the international gas markets. So and that flows through into Singapore as we import the LNG into Singapore. So import prices was high for the primary input into the power plants. And that translates into higher cost structure and higher electricity generation costs, which then flows into the wholesale electricity market and the retailers pick up -- pick that up and then they flow it through to you. So if we want to think about next year -- I'm sorry if I repeated this current year, that if I repeated something that folks really well know, please forgive me, right? But in my mind, I'm also trying to construct it so that then I can explain it for myself. So for this current year, which is 2023, where do we see electricity prices for end customers in Singapore. I will try to answer it without answering it, right? You saw that in our prospect statement, we did warn against or we pointed towards, I don't want to say warn, right? Because this is not a session where you say warn and you guys will probably say warning. No, it's not quite that. I want to point to what's that the international -- so you trace it back, it boils down to international gas prices. Now international gas prices, what is the outlook? We expect it to continue to be volatile. In the last 2 calendar quarters of 2022, Q3 prices were firmer than Q4. We saw it tapering down somewhat in Q4, right? So then this -- how does that move forward? Not quite sure. Because after Ukraine war happened, in mid-2022, when most people look forward, they say, "Oh, look, winter is going to be very bad, right? Because the European winter is it going to get coal, people will run out of gas? So then gas prices will go very, very high in winter. Lo and behold, in the fourth quarter when winter begins in Europe, prices softened relative to Q3. So the market is running ahead of itself. So today, if we take a crystal ball and we say, hey, look, what's going to happen in 2023 to gas prices. We expect it to not -- we don't expect to crash, let's put it that way, right? It's not going to just go back to the heydays of 2019, right? It will stay firm and then at that firm level, volatile on the upswing, right? So from month-to-month, you might see some event-driven issues. And then it will flow through into Singapore. Now that is international gas markets. Then in the Singapore side, our gencos, have we -- are we able to insulate ourselves from some of that by contracting long, right? So if we have gone out there, our gencos including Sembcorp gone out there to sign contracts to hedge against volatile prices, then we might be partially insulated against this. So I cannot speak on behalf of the other gencos in Singapore. I don't know what they've done, right? But for us, for 2023, a good portion of our production or expected production we have hedged, right? We have hedged. Now of course, hedge at what level I cannot share with you because otherwise, that's forward-looking. But we have hedged such that then we can say that our expected gas input costs into our power generation business would be stable because we have hedged a good portion of it. And then when it goes down to flowing down to end customers in Singapore, we hope that if our -- the entire -- all the marketplace has done the same as we did, then it would be more stable than less. And I can also, for whatever it is worth, and you can't speak -- I can't speak on behalf of the regulator. They are also watching this very closely. Our regulator, Energy Market Authority, they have also put into place measures that will help stabilize the market. So I would like to think that the retail electricity market for 2023 would be less choppy than 2022. Maybe that's as far as I could stretch myself. I see Eugene giving me that look really. So I hope I've shared some light. Like I said, answer without answering.

That's very helpful. But could I -- also the impacts of your conventional energy segment within Sembcorp, which is your largest segment, I mean what is the outlook like, are you expecting sort of stable margins, so that everything will be stable or because that sort of growth that you saw in 2022, I'm just wondering can it be repeated?

So as I mentioned just now, a good portion of our expected production in 2023, we have contracted. So if -- the gas part, the input part is a big driver of profit margins into our Singapore business, into our Singapore conventional energy business. So having contracted a good portion of it, we expect our 2023 conventional energy business in Singapore to be within our expectations. And having contract means it should be stable. So actually, Sembcorp CEO -- Sembcorp Hainan CEO, he would tell you -- I'm not going to pull him up here, but he would tell you that he should be quite confident about his budget this year.

So to a certain essential way, that's also an indication of the question that you asked me early on. Okay. So on interest costs, yes, although we averaged 4.1% across FY 2022, some of the refinancings that we have done in the fourth quarter of last year actually saw our weighted average cost of debt go up to 4.4% in the fourth quarter of last year. I think as we look forward into this year, as we focus on the refinancings that has to be done, I think we have to take note of a couple of factors, right, which are offsetting. Now firstly, it's -- base rates have come up, like, interest rates have hiked. But I think if you look at where OECD yield curves are, particularly U.S., Singapore, they are inverted. So at their longer end, when we're talking about 7, 10 years, base rates are actually lower than the short end rates. So obviously, we will be looking to refinance at the optimal tenants looking hit in light of the inverted yield curve. Now in certain countries, for example, like China, right, the yield curves are still represent -- are still representing a fairly normalized economy. So interest rates environment are still pretty benign there. So as we refinance in China, we do expect to be able to realize some positive interest cost impacts there. Now having said that, while base rates are in general, increasing, as I mentioned earlier on, 1 of the successes that we have in the last 2 years when we changed our financing philosophies again, using a corporate level, a green format of our financing where we get to average down on our margins as well as the spreads. So that would be the offsetting impact against the rising base rates that we are experiencing as we manage our overall interest costs. So net-net impact, we do expect interest costs potentially to creep up, but there will be mitigating factors that we have put in place to overall still manage our interest costs accordingly, okay? So that's what I will say about our cost of debt. Now the second question is in relation to accounting for the carbon for SEIL, post the transaction. The positive thing is that we have concluded obtaining a independent opinion from a well-known assurance firm, which tend to stand among the count of 4 globally, right, wouldn't name them. The conclusion that we got to is that from a Scope 1 and 2 perspective, SEIL would no longer be a contributing to our Scope 1 and 2. So that's clear. Now because we have the deferred payment note out to them, under Category 15 of the GHG carbon accounting protocols, we would be recognizing the Scopes 1 and 2. of SEIL back at Scope 3, right? And how that is done it will be the proportion that the deferred payment note represents in light of their total capital or total funding for SEIL to take in via Scope 3. So I would say that we can confirm that, that would be the accounting -- carbon accounting for SEIL going forward.

We have some questions on the web. One more question on your debt. For the Chinese acquisitions that you made in SDIC and HYNE, was there onshore debt, did you take onshore debt or offshore debt or a combination?

Okay. There is a funding of 2 elements. The funding of the equity component of those acquisitions are largely offshore debt, the proceeds from our ESG financing. So very efficient. Of course, we hedge via cross-currency swaps given the Chinese yen exposure, right? But the onshore debt that we have consolidated on the balance sheet from HYNE, they are onshore in nature, right? So obviously, taking the new philosophy of managing our project finance, there will be opportunities for us to optimize the cost of debt in the HYNE portfolio as we look at refinancing.

Okay. Some questions that's related to borrowings as well from the web. So any reasons why SCI is looking to cut project financing exposure and increase the corporate level? And also whether we've received any feedback on continued access to the sustainability financing market following the SEIL transaction and report.

Okay. Yes. I think in looking to cut project financing exposure, I think we have explained when we are looking to grow into renewables, the financing philosophy is a little different, right? For project financing, they tend to be very long dated floating rate in nature. And in addition and in addition to that, although nonrecourse as a result, having a higher margins, also very restrictive in terms of the cash flow waterfall, right? We have to fund DSRAs. We have to meet debt service coverage ratios and all that before cash could be made fungible. Maybe suitable when you are looking at very large CCGTs or well, pardon me for mentioning this, historically [indiscernible] that lend itself to single, very long PPAs to service the debt. Quite tricky for renewables, because renewables typically are on a individual project standpoint, they could range anywhere, even when this utility scale from 50 to 100 megawatts or 200 megawatts as opposed to 1 gigawatt, 1.5 gigawatts, 2 gigawatts, right? And so as a result, the renewable projects also from a time-to-market standpoint is a lot shorter to arrange. So using a corporate financing will allow us to be able to fund these projects a lot more nimbly. Now secondly, also is being able to manage their cash flows that come from these projects. Now given the fact that the growth in the renewable segment and the deployment of the CapEx is much shorter, being able to have as close as possible unfettered access to our group cash flows, particularly for these assets is important, right, so that we can always continually redeploy them for growth. So in a project financing setting where there is a lot of cash restrictions and waterfalls in place, that makes it difficult. Now the third element I want to touch on is in relation to capital recycling. Now clearly, after the renewables assets have reached maturity, then we have to start thinking about packaging them for capital recycling. Now if each of these 50-, 100-, 200-megawatt assets are well, I would loosely use the word encumbered by project financing, right? Being able to put together a package of assets for recycling will be challenging because ultimately, you will have to align a myriad of project financing banks, which potentially may have deferring terms. So to keep it simple, it's always easier to use corporate financing, which allows a lot more of these capital management, a positive capital management initiatives to be done. So the second question is, has SCI received any feedback on continued access to sustainability financing market. I think in relation to this element, the positive thing that we have gotten feedback from our lending banks as well as our investors is that particularly in the green financing market it is still very open and are supportive of us. From the sustainability financing market, I think, in general, there's a recognition that from a Sembcorp's perspective, whatever we have done in relation to the SEIL transaction was really in accordance to accounting protocols to the tee. So in our -- in terms of continued support for our access to the sustainability financing market, it is still a very strong and unfettered. Of course, the point would be, now that we have met some of our targets that we have set in our sustainability financing frameworks, then the question is that what would be the new possible set of targets that we could put out to refresh the framework that will be in line with our strategy. So in relation to that, we are currently working on that, and we will update the market at a later time.

As I thought I might want to leverage on this question to talk a little bit about the SEIL transaction from our perspective, right? We announced that we did it and structured it in a manner that would best serve the interests of our stakeholders. Who are our stakeholders? Stakeholders are our shareholders. Stakeholders are our lenders. Stakeholders are our employees. Stakeholders are our customers, right, among many stakeholders, but these are the main ones. This plant -- in the first instance, it ranks #4 amongst almost 180 coal plants in India, in terms of efficiency, right? Efficiency, that means, it is the cleanest relative to fourth in 180. So for India to decarbonize, they should shut down the number 180. If you shut down this one, somebody in India is going to get deprived of power, supply of clean -- a reliable source of power supply, low cost. So the customer interests shouldn't be compromised even as we promote our own green agenda, that's #1. Employees, despite in the highest -- the entire town, if not the city, 2,000 employees -- they need stable earnings. They have to bring home their food. They moved into living around the plant in order for them to continue serving their roles, right? So they -- we need to make sure that their interests are not compromised. More importantly, shareholders, if you look at other transactions that were done prior to our deal, coal plants -- minimum, if it is a sale, 40% discount, okay? 40% out of a SGD 2 billion book value, you can do the math. And what will happen to our shareholders or in terms of our financial performance, our balance sheet, you will knock down SGD 900 million to SGD 1 billion from our balance sheet. Suddenly, all the debt ratios will have floated up, right? If you look back, it will hamper our ability to transit our portfolio and to grow because we will have less access to the capital markets, our ratios are not good. Our debt level is high, right? Your equity just got knocked down by SGD 1 billion. Today, Sembcorp, if you look at our balance sheet, book equity SGD 4 billion, you knock down by SGD 1 billion, it's material you now, so it'll become SGD 3 billion overnight. So taking that big impairment when it's going to be a major valued consideration from a shareholder perspective, right? So I'm not going to go through all the stakeholders, but that's sort of the picture. But more importantly, we come out here to tell people we're going to transit the portfolio brown to green. What does that mean, invest in renewables, right? But what it also means is, I'm taking the cash flow from the brown to fund the green. So by structuring the deal this way, with a deferred payment mode, we continue to enjoy the buck with the cash flow coming from this business through the interest and principal payment from SEIL. And what do I do with the cash flow, goes towards growing the green, which we have shown you in the last 2 years how we can execute. So in our mind, it's very clear. We're transiting brown to green. We are taking the cash flow from the brown, go to the green instead of selling it at 40% discount, giving away that cash flow to someone else who most likely is going to run the plant very hard because they just got it cheap. So what is the better outcome for India, for stakeholders, for shareholders and for Sembcorp. For me, it was very clear, right? So brown to green, we continue to invest. And everything that we have done, as Eugene has mentioned, we met the financial accounting rules. We met the carbon accounting rules, and we got independent validation of all that. So that's really -- I think I want to -- I've not spoken about this since the deal was announced in September and then closed in January, right? So I haven't had the opportunity to share with you how certainly I see this and how -- that's why we structured the deal this way. That's why we are happy with the outcome. That's why we think we can then move on, even continue to benefit from the brown cash flow to fund the green, right? So this season, we are very lucky, the markets have been buoyant, margins have been kind to us. So our cash flow from the conventional energy segment is strong. The earnings is strong. And that's giving us that good favorable conditions for us then to continue to go into the green. Then the question is, are we able to find the quality projects, continue to find quality projects, are we able to continue to fund. So having some of that brown cash flow helps in the funding of the green ambition, right? So I just want to stop there just to help put things into our perspective. Everybody is entitled to their views. There are people who write reports, who try to promote their own cause. I respect their cause, but I have my stakeholders to look after.

Next question, please, from the floor. Mayank first.

Mayank from Morgan Stanley. I had 3 questions. I'll start with the renewables side and then maybe we'll move on to convention and the balance sheet. On the renewables side, you have around 1.5 gigs, which is currently under development. Can you just talk us of how much CapEx has been already spent on that? What's coming on that? And is it fair to -- for us to say that the 12% ROE, you kind of generated on renewable portfolio this year, that can be replicated on a 12-plus basis going forward for this additional capacity that's coming through? That was the first question. The second one was more related to, again, I'm just harping back on the gas point, but more from a 3- to 5-year perspective rather than 2023 perspective. You talked about the new portfolio that you have signed in terms of sourcing from TotalE. Can you just give us a big picture highlight of how much of your TotalE gas sourcing requirements are completed with the long-term supply? And what is still running on spot and where you see opportunities in terms of growing your gas portfolio in terms of sourcing? And what kind of contracts are we kind of thinking about? So if you can just give us a bit of a flavor there? And I think the last question was more related to the debt side. I think, Eugene, you talked about how you're thinking about getting 75% of the debt to fixed rates. But in terms of in absolute levels, are there certain ratios that you are saying that this is a number we want to get to? Or this is the absolute net debt that we want to get to and we are not going beyond this. Is there something that's in your mind when you're looking at balancing the balance sheet and the returns.

Let me answer the CapEx question first because your third question, Mayank, is quite cheeky, but I will deal with it in a different way. I think in terms of the CapEx question, the fact of the matter is there's a 1.5 gigawatts left. I think that from a CapEx deployment standpoint, roughly 1/3 to 40% have -- of that has been spent and continue to be developed. I think in terms of returns, Mayank, we have talked about it, right? We use a very disciplined approach CapEx based -- sorry, CAPM based and to make sure that all of that from a cost of capital perspective, it reflects the cost of capital at a time in which the projects are developed. I think what we are very happy to see is that across all the assets that is coming off maturity, right, the 12% run rate ROE that we see right now from a package of assets that is on average about 5 years old, right? So I think -- and that is largely within expectations. And I do expect that in a longer term -- and I mean, longer term, like to average out the ROEs, that level of ROE is certainly sustainable. So I think we have -- quite comfortable in how we have selected our projects, okay? Maybe I'll answer the third question first. Boss, you want to take the second one, on the longer term. Now third question, Mayank, you're asking me if I have a net debt number in mind, okay? I think the response I have to you is that at the end of the day, we did guide the market that by 2025, we target to have a debt-to-adjusted EBITDA of about 4.3x, right? Somewhere around at that level, we'll be comfortable. But of course, I -- it's hard to put out a number because it will really be dependent on growth and growth ambitions. But I just want to reiterate again that we do not need any external equity capital to complete this 10 gigawatts growth. So I just want to again respond to that categorically, Mayank and hopefully, this is probably like the third and fourth time you've heard from me and I will show you that in order to get to our 10 gigawatts, no equity capital raising, okay? So thanks.

Mayank, on the gas, you know that today, we are the largest importer of natural gas into Singapore through pipeline as well as LNG, right? It has -- it's a good position, actually. It's given us that opportunity to access customer downstream, also with the gas to generate power ourselves, right? So we can -- we sell steam, we sell electricity, we sell gas to downstream customers and also into the Singapore electricity market. And you know that, that was built on the back of a 20-year gas contract pipeline that started in 2001, right? So now you look at the date today it's 2023, that contract continues to flow, but it is beginning to deplete. Everybody knows that, yes. So we are in this business, we've got customer downstream, we have our own needs. So we enter into a fresh contract to bring in gas to replace what we haven't -- or what is to be depleting in the existing portfolio, right? So I want to emphasize that, that's sort of the motivation, right? So it's not speculative. We are doing it to the extent we can see the customer downstream. If we got customers and our own needs that I can see fine enough, then I would then be prepared to source fine enough with my supplier, right? So first, pipeline depletion. Second, not speculative, but to serve our customers downstream. And I want to reassure you that we find ourselves this season in actually a very interesting position because we have got -- our gas position has enabled us to really access and serve our customers with confidence in terms of gas and electricity for a reasonably long tenure. Maybe I can say that, that's our job. So because of that, my -- I can go upstream and buy contracts, buy gas with reasonably long tenures, right? And that provides a additional dimension to negotiate. You are prepared to sign long, people can give you a different pricing formula. If you sign short, everybody is going on spot, that one is very, very competitive, as you can imagine, with the shortage or the perceived shortage in gas, right? So I guess I was -- I wouldn't venture further from that. Mayank is looking at me with that encouraging look, hoping that -- I must tell you, I also don't have the details as to the pricing because you're going to ask me about the price, but I can talk about the term, right, without giving you a number, but I'm saying it's reasonably healthy term because we can see downstream and we can see upstream. But I want to reassure you again that we're doing it to serve our portfolio needs and we believe that will help us consolidate, if not grow our good position in terms of Singapore gas and electricity market. So today, as I mentioned that we are the largest gas importer into Singapore. It's a good position. We are happy with that. We would like to maintain that, if not grow it. I hope I answered that. The other part about the returns. Can I look at it also from a different perspective? We were looking at our renewables portfolio, right? We in 2 years quadrupled from -- I remember, we started about 2.5 -- 2.4 gigawatts, right, 2 years ago. And now we are almost at 10 gigawatts. So we quadrupled the capacity. Then the question you asked is, have you paid too much in a rush to grow it? When we did our own sums internally, if all these deals that we have announced up to right now, if they all are operating full year and taken into account for full year's operations, our earnings from this global assets from the renewable assets would have more than quadrupled. So starting from some SGD 50 million, you would have gone to north of SGD 200 million. So you quadruple the capacity, but you also quadruple the earnings. That gives us the confidence that we are doing deals that haven't eroded the returns, notwithstanding that the market has become more competitive, at least right up to this point. So I think that is another way that we think about it instead of talking to you about 10%, 15%. You know what we were doing 2 years ago for that 2.5 gigs, SGD 50 million. Today, we got almost 10 gigs. We quadrupled the earnings. So that's something that we are very proud of and we will continue to do the same.

Next question, lady at the back.

Siew Khee from CGS-CIMB. I've got about just 5 questions. Very easy. Just I know that I probably won't ask you about the returns question. But maybe just tell us how much of RE capacity is coming in for 2023. So then we know that you might have some new capacity that you would need to fund or to just look at which may actually dilute the potential long-term target, so that's just set our expectation. So capacity coming in, we need to ensure that would be helpful. Second question is just on landscape, on new opportunities in RE. I know that you said it's difficult, but maybe just share what you see from the ground in terms of pricing or just -- what are the things that you're looking out for that. So that is to build the hope that what will happen when you reach 10 gigawatt very, very soon. That was my second question. My third question would be, Eugene, for Singapore profit in second half or rather in first half, Singapore contributed about 60% of CE. Is it still about the same? And in that second half CE, do we have much gas hedges gains, that will be my next question. I can't remember how many really -- but then can I also ask -- the next question is further provision risk for Myanmar assets? I know you have actually done a thorough review and you have explained to us, but what are the things that we should be looking out for that may cause you to provide further or potentially write back. And my final question is, what's the receivable status the SGD 700 million from the sale of SEIL because I noted that we have SGD 21 million delayed interest income in second half. So that would be transferred into interest from DPN next time, right? But I just wanted to check on the SGD 700 million receivables.

Okay. Maybe I'll take on 1, 3, 4, 5, and then you want to touch on 2, which is the landscape on renewables. Okay. So okay, for the first one for RE capacity coming in 2023, Siew Khee, I think if you look at our announcement, so the clear one would be all the 3 acquisitions that we have made, right? So those that would be the guaranteed one. I think in terms of the timing of other additions we have our construction schedule. So they may move around a little bit. But I would say that the definite contribution into FY 2023 will be the 3 acquisitions that we have made now. Okay. Now the third question is, Singapore contribution to conventional energy. Yes, you're right, it's still approximately about 60%. In terms of hedges, gains in the second half, they are at similar levels to the first half. Okay? And so the last one on the receivable status. So receivable status have been very positive, both Andhra Pradesh and Telangana did not miss a single equal monthly installment payments. So it was at about SGD 700 million, as we talked about. Thankfully, we ended the year at a high 400s, almost SGD 500 million. So in a space of, call it, 5 to 6 months, we were able to collect about SGD 200 out of those past receivables. Yes. And then in terms of further provision for Myanmar. Now looking at the current economic state and the ECL provision, we are quite comfortable that it does reflect the additional ECL that we need. Now the only question is that would that -- what are the possible triggers that may even result in a real cash impairment of the assets. So one the key things that we are looking out very closely, obviously, is the economic sanctions that potentially could be placed on Myanmar countrywide or EPGE, our counterparty. Now when that happens, typically, and we know the drill, once the economic sanctions are in place, many of our account banks would probably find it hard, will not probably find it hard, they definitely will not be able to receive payments coming out from sanctioned parties. And then at that point in time, we would potentially have an outright credit impairment of the assets' cash flows. And then we would have to assess the further provisions at that time. So then that answers, Siew Khee, your 1 3, 4 and 5. Then as the second question, boss, you want to touch?

Okay. Siew Khee, I take it that your question is related to new opportunities in renewables? Is it -- okay, okay. So sorry, I didn't quite catch that just now. So I think -- you look at what we did in the last 2 years, we went into markets where we have got boots on the ground, India, China, Southeast Asia, right, Vietnam, Singapore, U.K. So that has served us quite well. These markets continue to show very good growth potential, right? India continues to show good potential even though some of the greenfield, Siew Khee, bids have become very competitive, but we're very happy to note that we were able to find opportunities otherwise, right? So you saw that we did Vector Green. It was at, we believe, a decent pricing -- price point that we got it, right? There are actually some acquisition opportunities that we continue to come across, yes. We are also doing quite well in the C&I segment. Even though the numbers are not very big, but they do add up. And the nice thing about C&I portfolio is that the margins are good and the customer base diversified. And so we are seeing good C&I. We're seeing some acquisition opportunities in addition to the traditional greenfields that are around. We want to maintain strict discipline. We don't want to do a deal for the sake of the megawatts. As I mentioned to you, the earnings is just important, if not more important than the megawatts. And we are also seeing a slight -- maybe a slight -- I shouldn't say it's slight, but we're seeing some changes in the competitive landscape. You look at what's happening in India, obviously, Adani is in a bit of a situation, right? And then you see renew also not aggressively growing. You see green coal [indiscernible] saying that they want to go into pump hydro, right? So the competitive landscape is changing, right? Then the flip side of it is, the interest rate is going up, right? But the opportunities remain -- the demand for green capacity remains strong. So we think India continues to be a market where we can find deals. China, likewise, emerging from COVID, things are beginning to turn around. Again, it cuts both ways, right? Then with all, with the borders opening, what has been a barrier to entry for our competitors is now becoming lower barrier, right? But our relationships, our track record, our profile, our ability to move fast and be nimble in terms of terms and conditions has really set us well. So the market continues to show strong growth potential. Southeast Asia, I don't need to get into them, right? So that's sort of, first, the first point I'm trying to make in answer to the question really from our perspective, where we were successful in growing the green portfolio, the renewable portfolio, we see the markets largely, still having strong demand. The second leg to this, increasingly, there's a lot of talk about green hydrogen. And you need massive amount of renewables, if you want to produce green hydrogen in places that are -- where we operate China, India, but also in new geographies like Middle East and perhaps Australia, right? Chile was held out as one of the most prolific solar destinations. I think it's a little bit far from us. But very close to home, we're talking Australia and Middle East. Middle East, we actually operate there in UAE as well as Oman, right? We actually have got people on the ground, although they are not renewables people. So some of this -- the way I'm heading is that the hydrogen angle to that extent if there is a demand that is strong enough to produce green hydrogen from renewables, we stand ready to be in that equation, to be part of the value chain to be the one from building and owning the renewables to sell the green electrons to the hydrogen producer, who would then take the green electrons and turn into green hydrogen. And that may take us into some new geographies like the Middle East and Australia. So just to put into perspective, I was told that if you need to make 1 million tonnes of hydrogen, green hydrogen, you need 14,000 megawatts of wind to serve that, to make 1 million tonnes of green hydrogen, right? It's not totally equivalent, but to put again the total demand for Singapore gas is 9 million to 10 million tonnes of natural gas, right? So the calorific value is not equal. But in terms of -- it cannot be that far off the tonnage, it's not -- so 1 million tonnes is -- just if Singapore has to convert all to green hydrogen, we're talking about huge amount, massive amount of renewables, right? So we don't need to go there. But the point really is that there is, that we are watching that, and that could be a very big demand, source of demand for renewable energy capacity, and it could take us to new geographies like Middle East and Australia. Even though in our existing geographies, India, China, these are also big developments, yes. So coming back to Siew Khee's point, first, our -- the markets that we currently operate and have grown well, continues to be prolific. And then we are also thinking in the long run with developments in green hydrogen, the need for renewables to produce green hydrogen, we could also be part of the value chain. I think that's the gist of...

In the interest of time, we'll take 1 last question from the floor. Shaun?

Shaun from Credit Suisse. Just 2 questions from me. The first one is on the conventional energy in Singapore. I heard that it was contracted -- 2/3 of our capacity is contracted out for 1 to 3 years. So I was wondering if you could share when the weighted average period for this contract, right? So when will we be more exposed to the spot pricing? So that's the first question. The second question is on the Myanmar power plant. After this ECL provision that we had taken, is there a receivable balance that sits on that power plant asset? And if so, how much is it?

So to answer your first question, wouldn't be able to tell you what the weighted average is, but I think what I can comfortably tell you is that 2023 is covered. Okay. Now on your second question, after taking that USD 78 million of write-down, the remaining service concession receivables is probably in the region of about $180 million, okay? Now because if you've seen what we have shared with you, it's the loan that is still outstanding for Myingyan and also the book value. So your service concession typically, if we talk accounting will be approximately the sum of those 2, is largely the capital that we put in place, right, that will be covered by the concession. So given that we have provided $78 million, there's still about $188 million that is still outstanding.

We've now come to the end of today's briefing. Thank you very much for joining us today.

Thanks, everyone.

Please feel free to step outside. We have refreshments prepared for everyone at the foyer.