1. Investment Case

Phoenix Solar AG
Consolidate the Turnaround!
September 2015
Table of Contents
1. Investment Case
2. Profile and Business Model
3. Market Overview
4. Financial Results Q2 2015
5. How to Consolidate the Turnaround
6. The Next Steps
7. Strategic Outlook
8. Executive Summary
2
Phoenix Solar is Excellently Positioned in the PV Growth
Regions in the USA, Middle East and Southeast Asia
Investment Considerations
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One of the pioneers in the photovoltaic (“PV”) industry and independent international PV system
integrator with a strong brand recognition
One of the last remaining public EPC companies worldwide
USP: Top expertise in optimizing PV power plant design and engineering for highest energy yields
Outstanding track record (more than 1 GW of installed or sold modules)  international expertise
in large scale power plants using both crystalline and thin-film modules
International network of subsidiaries with a strategic focus and excellent market position in the
growth regions USA, Middle East and Southeast Asia
Committed bank financing available until September 2016 (approx. € 110 million)
Highly experienced senior management team and a very qualified employee base
Phoenix Solar being one of the few winners in the current consolidation process in the PV market
offers long-term growth perspectives
Phoenix Solar AG – consolidate the turnaround and return to growth
3
Table of Contents
1. Investment Case
2. Profile and Business Model
3. Market Overview
4. Financial Results Q2 2015
5. How to Consolidate the Turnaround
6. The Next Steps
7. Strategic Outlook
8. Executive Summary
4
Phoenix Solar: Capabilities Across the
Solar Value Chain
Origination
Select the
optimal sites
in regards to
project
execution &
production
Due
Diligence
Proposal
Comprehensive,
competitive
and
customized
proposal
Site studies: Geotechnical studies,
permitting, environmental, PPA
negotiations, Interconnection Studies
O&M Skills
EPC Skills
Project Development Skills
Project
Finance
Engineering &
Design
Financial advisory work,
financial model review and
2 set of eyes for closing
documents
Plant Design optimization,
LCOE analysis: right
technology for the right use
Construction &
Commissioning
Operations &
Maintenance
Strong management
capabilities to reduce overall
ownership costs
Utility like safety standards.
Executing on time, on budget
and with an excellent
attention to detail.
5
Phoenix Solar is a Pioneer of the Photovoltaic Industry
Mainly Focussed on the Construction of Power Plants
 The predominant business model is „EPC“ of photovoltaic power plants –
both, roof-top and green-field.
Customers
Retail, commercial and institutional investors, utilities
Operations
Sales
Engineering
Procurement
Construction
Operation
&
Maintenance (intl.)
Cash Flows
out: personnell and
materials
Suppliers
Diverse local
sales agents
in: progressional milestone payments
in: long term contracts
monthly/annual fees
Manufacturer independent: always best
price-performance ratio for customer
6
Our Offering: Excellence in EPC
Turn Key Development & EPC Phase
Range of Services
Consulting
Engineering
Project
Management
 Site assessment
 Energy production modeling
 Economic and financial consulting
 System planning and layout
 Technical plant design
 Engineering
Final Product
Turn Key PV Solar Power Plants
 Power Range:
1 - 75 MWp
 Installed capacity:
approx. 600 MWp
Utility-Scale Ground-Mounted Systems
 Procurement and evaluation of
system components / equipment
 Construction management
 Plant commissioning
Commercial & Industrial Roof-Mounted Systems
Execution
Post-Construction
Phase
 Turn key installation
 Performance testing




Operation management
Maintenance & inspection
Repair
Plant optimization
7
Customer Satisfaction
Duke Energy - Fayetteville, NC USA
Green Field Power Plant – 32.1 MWp
Duke Energy - Key Customer

USD 25 bn Revenues

Largest Utility in the USA

Highest Standards re Quality and Safety



Customer Feedback, June 9:
Duke is impressed by Phoenix
Excited by engineering, team,
execution
“Phoenix is on a higher level
than two of its competitors,
carrying out other solar projects
on our behalf... “
8
Table of Contents
1. Investment Case
2. Profile and Business Model
3. Market Overview
4. Financial Results Q2 2015
5. How to Consolidate the Turnaround
6. The Next Steps
7. Strategic Outlook
8. Executive Summary
9
The Solar PV Market:
Global Installed Capacity Reaches New Peaks
Photovoltaic Global Capacity

Ongoing strong worldwide growth:
installed capacity approaches 200
GWp

Biggest base in Europe, Asia is
catching up

USA on an ambitious growth path

China remains a closed shop for
foreign vendors
Source: https://en.wikipedia.org/wiki/Growth_of_photovoltaics
10
Photovoltaic Capacity Continues to Grow Fast–
Phoenix Solar Takes its Share of the Market
Market Forecasts
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Installed capacity today at approx.
180 GWp
Capacity Added Estimated to reach
54 GWp in 2015
Low Case Estimates until 2019
approx. 400 GWp
High Case Estimates until 2019
approx. 540 GWp
11
Solar Increases its Share in Total Energy Production
Source: EIA, GWEC, Deutsche Bank Estimates
12
The Solar PV Market:
Cost Base Down 78% from 2009 through 2014

LCoE = Levelized Cost of Energy (Total Generating Cost)

Solar is competitive now, has almost overtaken cost of wind

Coal at $66 - 151/MWp – Natural gas/ CCGT at $61 - 87/MWp
Source: Lazard, LCOE Study, 09/2014
13
Table of Contents
1. Investment Case
2. Profile and Business Model
3. Market Overview
4. Financial Results Q2 2015
5. How to Consolidate the Turnaround
6. The Next Steps
7. Strategic Outlook
8. Executive Summary
14
Key Profit and Loss Figures
First Six Months of FY2015*
H1 2015
H1 2014
% Change
39.8 €M
12.1 €M
> 100 %
> of which Components & Systems
2.9 €M
8.1 €M
-84.9 %
> of which Power Plants
36.8 €M
3.9 €M
>100 %
> share of international business
39.6 €M
10.4 €M
> 100 %
Other operating income
1.7 €M
4.1 €M
- 59.4 %
Personnel expenses
4.7 €M
4.9 €M
- 3.6 %
Other operating expenses
3.6 €M
5.3 €M
- 31.5 %
Depreciation & amortization
0.7 €M
0.8 €M
-9.8 %
EBIT
- 4.6 €M
- 3.3 €M
- 37.3 %
> of which Components & Systems
- 1.3 €M
0,3 €M
n. a.
> of which Power Plants
- 3.2 €M
- 3.6 €M
+ 9.9 %
- 6.6 €M
- 6.3 €M
- 5.2 %
- 6.3 €M
- 6.4 €M
+ 1.3 %
Revenues
Net profit / loss for the six months period
> of which attributable to shareholders
* Group Financial Statements
15
Key Balance Sheet and Cash Flow Statement Figures
First Six Months of FY 2015*
06/30/2015
12/31/14
Non-current assets
17.4 €M
17.9 €M
Inventories
2.0 €M
2.1 €M
Receivables from long-term construction contracts
26.7 €M
1.0 €M
Trade receivables
8.5 €M
10.4 €M
Shareholders‘ equity
- 8,6 €M
-1.6 €M
Trade payables
29.7 €M
2.5 €M
Non-current financial liabilities
42.4 €M
38.6 €M
Total assets
70.8 €M
45.2 €M
Equity ratio
- 12.1 %
-3.5 %
2015
2014
-3.7 €M
-5.0 €M
Cashflow from operations (Jan – Jun)
* Group Financial Statements
16
Table of Contents
1. Investment Case
2. Profile and Business Model
3. Market Overview
4. Financial Results Q2 2015
5. How to Consolidate the Turnaround
6. The Next Steps
7. Strategic Outlook
8. Executive Summary
17
How to Consolidate the Turnaround?
(1) Cost Structure Significantly Improved
Other operating
expenses
Personnel expenses
40
40
30
- 68 %
30,0
35,9
30
21,1
- 70 %
25,2
20
20
14,6
9,6
10
0
2011
2012
2013
2014
9,4
2015e *
12,3
10
10,9
7,2
0
2011
2012
2013
2014
2015e*
*) Forecast for 2015 arithmetically : Q2 expenses x 2
18
How to Consolidate the Turnaround?
(2) Improve Sales Performance
Free Order Backlog / Order Intake
140
140
131,2
120
120
102,1
100
100
93,2
80
80
60
60
45,5
40
40
41,0
20
20
0
0
Mar 14
Jun 14
Power Plants
Sep 14
Dec 14
Components & Systems
Mar 15
Jun 15
Order Intake
19
How to Consolidate the Turnaround?
(3) Significant Top Line Growth
Phoenix Solar Group: Revenue & EBIT Development
2013 - 2015 (in € mn)
Forecast
180,0
160
160,0
140
140,0
10
8
6
120,0
3
100,0
2
1
80,0
4
0
60,0
40,0
-2
20,0
-4
-
-6
2013 actual
2014 actual
Sales Revenue
Forecast 2015
Forecast 2015
EBIT
Depending on timely construction starts on key projects.
20
Table of Contents
1. Investment Case
2. Profile and Business Model
3. Market Overview
4. Financial Results Q2 2015
5. How to Consolidate the Turnaround
6. The Next Steps
7. Strategic Outlook
8. Executive Summary
21
Next Steps at Phoenix Solar AG:
Six Point Plan (1)
1
Growth 2015: Dedicated focus on closing profitable projects

Gain momentum, in operations, financials and share price
Continue to differentiate:
2

High quality EPC and Services … support project financing, O&M,
utilize network in favor of our customers
Strategic Purchasing
3

Global Supply Chain Function – volume advantages,
supplier partnerships
22
Next Steps at Phoenix Solar AG:
Six Point Plan (2)
4
Reduce operating cost per Wp for competitive reasons by approx
6-8 % p.a.
Forge Strategic Alliances
5
6

Short term: vendors, project developers, sub contractors

Mid term: strategic partners
Base corporate culture on communication,
processes, performance to secure jobs in the long term
ULTIMATIVE GOAL
Create sustainable value for owners and investors
through reliable engineering and execution of high performance power plants
23
2015 Focus on Core Markets in Growth Regions:
Competent Teams on Location, Systematic Approach
Europe
Americas
• France
• Spain
• Greece
• USA
• Latin America
Middle East
•
•
•
•
Phoenix Solar
AG, Germany
(Since Nov. 1999)
Phoenix Solar
SAS, France

(Since Sept. 2009)
Phoenix Solar
Inc., USA
Phoenix Solar
S.L., Spain
(Since Sept. 2010)
(Since Apr. 2006)

Turkey
Jordan
Saudi Arabia
UAE



Phoenix Solar
E.P.E., Greece
(Since June 2008)
Asia/Pacific
•
•
•
•
Singapore
Philippines
Thailand
Malaysia
Phoenix Solar
Sdn Bhd,
Malaysia
(Since Sept. 2010)
Phoenix Solar
Pte. Ltd.,
Singapore
(Since Dec. 2006)
Phoenix Solar
L.L.C., Oman
(Since Dec. 2009)
All 100% owned subsidiaries, except Phoenix Solar Singapore (75%), Phoenix Solar Malaysia (75%) and Phoenix Solar Oman (70%)
24
Project Pipeline 2016
Already Good Demand – Competent EPC are Being Searched for

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USA: Booming market, utility segment alone is to reach
6 to 8 GWp in 2016
Middle East: growth markets in Jordan and Turkey:
we are well positioned and networked
Asia/Pacific: Expanding the team, Focus on the Philippines
Sales approach: understand the potential,
systematically identify attractive projects
and close profitable contracts
25
Global Sales Pipeline per Region
as of June 30, 2015
Global Sales Pipeline (in MWp, weighted)
Share by region (%)
7,5
25,3
43,4

USA: 67%

Asia/Pacific: 19%

Middle East: 11%

Europe: 3%

151,8
USA
Asia/Pacific
Middle East
Europe
Total 228,0 MWp,
weighted
Table of Contents
1. Investment Case
2. Profile and Business Model
3. Market Overview
4. Financial Results Q2 2015
5. How to Consolidate the Turnaround
6. The Next Steps
7. Strategic Outlook
8. Executive Summary
27
Value Chain and Growth Potential
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
Potentials Cube: Systematically Assess Market Trends and Volumes
Explore and Seize Opportunities Along Our Strategic Guidelines
1. Market
Segments
Utility 
C&I Rooftop 
Off-Grid
3. Geographies

Residential
Project development
2. Value Chain

EPC 
O&M 
IPP

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Mid- to Long-Term: Explore the fourth growth dimension

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4th Dimension
 Project Financing
 Hybrid Systems
 Diesel Replacement
 Desalination
28
Table of Contents
1. Investment Case
2. Profile and Business Model
3. Market Overview
4. Financial Results Q2 2015
5. How to Consolidate the Turnaround
6. The Next Steps
7. Strategic Outlook
8. Executive Summary
29
Executive Summary
Well Positioned – Turnaround Ahead – Long-term Growth Perspectives

Global solar market continues to grow fast, great opportunities!

Focus on turnaround in 2015; revenue forecast of €140-160 mn with positive EBIT

Good working global sales process as growth driver

Solid sales pipeline, weighted > 200 MWp; good prospects for 2016 and beyond

Market potential is being scrutinized systematically

Differentiated service offering, best price/performance:
“Excellence in Global EPC”
30
Phoenix Solar AG
“Excellence in Global EPC”
Appendix
Share Price Development
( Feb 28 - Aug 27, 2015)
13,6*14,88
Appendix
33
The Company is Led by a Competent, Skilled, International
Management Team with Broad Solar Industry Expertise
Tim P. Ryan
CEO since 01/2015
Manfred
Hochleitner
Dr. Murray
Cameron
CFO since 01/2015
Founder, Member of the
Executive Board (2003)
Broad experience in growth - oriented
With extensive experience in financial
Expert in the field of photovoltaics since
business development, general
affairs, Manfred Hochleitner takes the
1994. Lead a wide range of international
management and leadership with
responsibility for Controlling, Treasury,
renewables & storage projects on behalf
international businesses. Expert for the
Group Accounting, Tax functions and he
of the European Commission & European
technical, sales-related, commercial and
plays a significant role in Group financing.
Parliament. CEO of the European
financial aspects of utility-scale and
Photovoltaic Industry Association (EPIA)
commercial rooftop solar PV systems.
2000 to 2003 and a board member since.
Major Responsibilities:
Major Responsibilities:
Major Responsibilities:

Corporate Strategy

Finance and administration

Global Partner Network

Business Development and Sales

Internal Audit, Legal and Compliance

Global Procurement

USA, Asia Pacific, Middle East Regions

Europe Region

Strategy Projects

Corporate Communications

Investor Relations
Appendix
34
Project Experience: Georgia (USA)
Simon Solar Farm:
38.6 MWp

Location: Georgia (USA)

Commissioned: November 2013

1000 V system

IPP (Silicon Ranch) selling power under a PPA to
Georgia Power
Services
Equipment

Site due diligence and design

Development services

Approx. 130,000 JA (305/310W) Solar Modules

Interconnection study and application services

40 SMA inverters (SD 750 CP-US)

Full EPC services, Operations & Maintenance

Unriac fixed tilt racking at 20 degrees

Substation design and construction

High Voltage Interconnection


Energy Data Acquisition System
Structured finance moderation

Final advisory services for permanent and
construction financing
Specific Challenges

Record rain falls during construction required close schedule management

Despite detailed geotechnical studies, rock encountered; creative low cost mitigation by redesigning plant during construction
Appendix
35
Project Experience: Thailand (Asia) and Riyadh (Saudi Arabia)
Solar Park Solarco:
36.0 MWp
Solar Park KAPSARC:
3.55 MWp
Location:
approx. 2h from Bangkok (Thailand)
Location:
Riyadh (Saudi Arabia)
Connected:
November & December 2013
Connected:
December 2012
Scope of work Phoenix: Engineering, Procurement,
Scope of work Phoenix: Engineering, Procurement,
Project management
Project management
Module technology:
Crystalline
Module technology:
Polycrystalline
Rated System power:
36.0 MWp
Rated System power:
3.552 MWp
Appendix
36
Phoenix Solar Share in Brief
International Securities Identification Number
(ISIN)
DE000A0BVU93
German Securities Identification Number (WKN) A0BVU9
Symbol
PS4
Number of shares issued and outstanding
7,372,700 no-par bearer shares
Share Capital
€ 7,372,700
Market Segment
Official Market (Deutsche Börse Prime Standard)
Trading
XETRA, Frankfurt (Prime Standard), Munich
(M:access), Stuttgart, Berlin, Dusseldorf,
Hamburg, Hannover
Industry sector / subsector
Industrials / Renewables
Financial year ends
31 December
Designated Sponsor
Oddo Seydler AG
Appendix
37
Disclaimer
The content of this presentation is solely for information purposes and is not intended to constitute a recommendation for
investment or a solicitation to subscribe or an offer to buy or sell securities of the company. Phoenix Solar AG shall
undertake no liability whatsoever for any loss in connection with this presentation or the information contained therein. This
also applies particularly to any eventual loss in connection with the shares of Phoenix Solar AG.
This document contains forward-looking statements on future developments which are based on management’s current
assessment. Words such as “anticipate”, “assume”, “believe”, “estimate”, “expect”, “intend”, “can/could”, “plan”, “project”,
“forecast”, “should”, and similar terms are indicative of such forward-looking statements. Such statements are subject to
certain risks and uncertainties which are mainly outside the sphere of influence of Phoenix Solar AG, but which have an
impact on the business activities, the success, the business strategy and the results. These risks and factors of uncertainty
include, for instance, climatic change, changes in the state subsidisation of photovoltaics, the introduction of competitor
products or technologies of other companies, the development of the planned internationalisation of business activities,
fierce competition as well as rapid technological change in the photovoltaic market. If one of these or other factors of
uncertainty or risks should occur, or if the assumptions underlying the statements should prove incorrect, the actual results
may diverge substantially from the results in these statements or implicit indications. Phoenix Solar AG does not have the
intention nor will it undertake any obligation to realise forward-looking statements on an ongoing basis or at a later point in
time as this is entirely dependent on circumstances prevailing on the day of their release.
In some countries the dissemination of this presentation and the information contained therein may be restricted or
prohibited under the law. This presentation is therefore expressly not intended for persons resident in legal systems under
which such an offer or solicitation is not permissible, or for persons for whom such an offer or invitation would constitute a
breach of the law.
Appendix
38
Contact Details
Phoenix Solar AG
Dr. Joachim Fleing
Hirschbergstrasse 4
D-85254 Sulzemoos
Germany
Phone
+49 8135 938-315
Fax
+49 8135 938-429
www.phoenixsolar-group.com
[email protected]
Appendix
39
40