AES(US:AES)2021-05-06 19:18Financial Data and Key Metrics Changes - Adjusted pre-tax contribution (B2C) for Q1 2021 was $247 million, consistent with expectations and similar to last year's performance [18] - Adjusted EPS for the quarter was $0.28, down from $0.29 last year, primarily due to a slightly higher effective tax rate [19] - The company is on track to achieve full-year 2021 adjusted EPS guidance range of $1.50 to $1.58 [21] Business Line Data and Key Metrics Changes - In the U.S. and utilities SBU, PTC decreased by $27 million due to lower contributions from legacy units and higher spending in clean energy [19] - South America SBU saw a $31 million decrease in B2C, mainly from lower contributions at AES Andes due to higher interest expenses [20] - The Eurasia SBU reported higher PTC due to improved operational performance and lower interest expenses [20] Market Data and Key Metrics Changes - The company has a backlog of 6.9 gigawatts of renewables, representing a 20% growth in total installed capacity and a 60% increase in renewables capacity [9] - The global pipeline of renewable projects exceeds 30 gigawatts, with half located in the United States [10] Company Strategy and Development Direction - The company aims for 7% to 9% average annual growth through 2025, focusing on low carbon energy sources [6] - Key goals for 2021 include signing contracts for 4 gigawatts of renewables and launching a 24-7 carbon-free energy product [8] - The company has transformed its portfolio, reducing coal capacity by 70% over five years and targeting net zero emissions by 2040 [16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about economic recovery across markets, with demand returning to pre-COVID levels [18] - The company is preparing for potential future supply chain constraints due to increased demand for renewables [42] Other Important Information - A landmark agreement with Google was announced to supply 24-7 carbon-free energy for its data centers [11] - The company is working on a green hydrogen project in Chile and a new LNG terminal in Vietnam [53] Q&A Session Summary Question: Insights on the Northvolt agreement and energy storage market - The Northvolt agreement is a strategic relationship to ensure battery supply and joint development of new battery technologies [28] Question: Replicability of the Google deal with other customers - The product offers hourly carbon-free energy, which is unique in the market, and there is significant interest from other corporate clients [32] Question: Competition in the market - The company faces competition but aims to provide more value through innovative solutions and co-development with clients [36] Question: Supply chain stresses across the renewables value chain - Currently, there are no significant supply constraints, but the company is preparing for potential future challenges [42] Question: Growth potential of the 5B technology - The 5B technology will be available to the broader market over time, similar to previous successful ventures [46] Question: Updates on the strategic alliance with Google - The initial agreement with Google is expected to expand as their energy needs grow [51] Question: Progress on hydrogen and LNG projects - The feasibility study for the green hydrogen project in Chile is ongoing, and the LNG terminal project in Vietnam is progressing as planned [53]