Good day, and thank you for standing by. Welcome to Enlight First Quarter 2024 Earnings Call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Yosef Lefkovitz, Vice President and Corporate Finance.

Thank you, operator. Good morning, everyone, and thank you for joining our first quarter 2024 earnings conference call for Enlight Renewable Energy. Before beginning this call, I would like to draw participants' attention to the following: certain statements made on the call today, including, but not limited to statements regarding business strategy and plans, our project portfolio, market opportunity, utility demand and potential growth, discussions with commercial counterparties and financing sources, pricing trends for materials, progress of company projects, including anticipated timing of related approvals and project completion and anticipated production delays, expected impact from various regulatory developments, completion of development, the potential impact of the current conflict in Israel on our operations and financial condition and company actions designed to mitigate such impact, expected changes in Clenera's leadership and the company's future financial and operational results and guidance, including revenue and adjusted EBITDA are forward-looking statements within the meaning of US Federal Securities law, which reflect management's best judgment based on currently available information. We reference certain project metrics in this earnings call, and additional information about such metrics can be found in our earnings release. These statements involve risks and uncertainties that may cause actual results to differ from our expectations. Please refer to our 2023 annual report filed with the SEC on March 28, 2023, and other filings for more information on the specific factors that could cause actual results to differ materially from our forward-looking statements. Although we believe these expectations are reasonable, we undertake no obligation to revise any statements to reflect changes that occur after this call. Additionally, non-IFRS financial measures may be discussed on the call. These non-IFRS measures should be considered in addition to, and not as a substitute for or in isolation from our results prepared in accordance with IFRS. Reconciliations to the most directly comparable IFRS financial measures are available in the earnings release and the earnings presentation for today's call, which are posted on our Investor Relations webpage. With me this morning are Gilad Yavetz, CEO and Co-founder of Enlight, Nir Yehuda, CFO of Enlight, Jason Ellsworth, CEO and Co-founder of Clenera and Adam Pishl, COO and Co-founder of Clenera. Gilad will provide some opening remarks and will then turn the call over to Jason and Adam for a review of our U.S. activity and then to Nir for a review of our first quarter results. Our executive team will then be available to answer your questions.

Thank you, Yosef, and thank you all for joining us today. Enlight is off to a strong start to the year, and we are pleased to present a robust set of financial results for the first quarter. Revenue grew 27% year over year to $90 million, while Adjusted EBITDA grew 28% year over year to $68 million in the quarter. We benefited during the quarter from high production levels across our 1.9 GW operational portfolio, particularly at some of our largest wind farms. Net income was $24 million versus $33 million last year, which benefitted from one-off financing income we recognized post-IPO last year, which Nir will explain in more detail later on. On the back of these results, we are pleased to reaffirm our full year 2024 guidance. In addition to the strong financial results, we continued to execute on our project portfolio during the quarter. Our projects are proceeding on schedule, including the 579 MW and 1.7 GWh expected to reach COD this year, as well as the 1.1 GW and 2.9 GWh of new projects we expect to start construction this year. Enlight is on the cusp of a major expansion, which will ultimately result in the tripling of the company's generation and storage capacity to 5.1 GW and 5.7 GWh by 2026. We are laser focused on the execution and delivery of our plan. Let me describe what we are seeing in the United States, where the industry fundamental backdrop is one of the best we have ever seen. First off, demand for electricity is increasing. For most of the past decade, forecasts for long-term annual U.S. load growth stood at approximately 0.5% per year. But this accelerated in 2023, when forecasts for long term demand nearly doubled to 0.9% a year until 2028. This represents…

Thank you Gilad, Enlight and Clenera are rapidly expanding in the U.S. and we are laser focused on construction and project finance. In total, we plan to be in active construction on more than 1.2 GW of solar and 3.2 GWh of battery during 2024. Our 364 MW and 1.2 GWh Atrisco project in New Mexico is on schedule. We expect to reach COD on the solar in the third quarter. The solar project has already reached mechanical completion and commissioning work is underway. The battery is expected to be complete during the fourth quarter; equipment is almost all on site and work is underway to connect the initial circuits. Looking beyond Atrisco, we plan to begin construction on Country Acres, Quail Ranch, and Roadrunner in the second half. These projects together total 810 MW of generation and over 2 GWh of energy storage. The 392 MW and 688 MWh Country Acres project in California is expected to begin first. All regulatory and permitting hurdles are clear and construction contracts are nearly complete. Quail Ranch is not far behind. The 128 MW and 400 MWh project in New Mexico is ready to start construction but awaiting PPA regulatory approval. Finally, the 290 MW and 940 MWh Roadrunner project in Arizona is completing its remaining governmental approvals. Before year end, we expect all three of these projects to enter construction. Each is an important part of delivering our 2026 objectives. Our CO Bar project in Arizona is comprised of 3 busbar PPAs totaling approximately 1.2 GW and 824 MWh and contracted with APS and SRP. The APS queue reform is ongoing and is still on track to support a year-end 2026 COD for the vast majority of the project, with the remainder to follow in early 2027. We continue to engage…

Thank you, Jason. In the first quarter of 2024, the company's revenues increased to $90 million, up from $71 million last year, a growth rate of 27% year over year. Growth was mainly driven by new operational projects compared to last year, while being offset by a decline in revenues caused by much lower electricity prices in Spain relative to the prices observed in the same quarter last year. Since the first quarter of last year, 10 new projects in the US, Hungary, and Israel started selling electricity. The most important of these is Genesis Wind, which contributed $9 million to revenue. In addition, Björnberget, which barely sold power at the start of 2023, contributed $7 million in this quarter. Gecama generated approximately $20 million in revenues; however, its contribution fell 6% year over year due to much lower Spanish power prices compared to Q1 '23. We sold power in Spain at an overall average price of EUR 65 per MWh this quarter versus EUR 85 per MWh in the same period last year. The decline in pricing was offset by very high production volumes, which were 20% higher than last year, as well as the results of our hedging strategy, which allowed us to sell 52% of Gecama's production at a price of EUR 98 per MWh. In Israel, 7 of the 12 Solar plus storage cluster units are now in operation contributing $3 million, while none were selling electricity in the same period last year. Finally, the reclassification of financial asset projects in Israel to fixed asset projects boosted revenues by $3 million, though at the same time, we moved the sum from the financial income line. Fourth quarter net income has declined by 26% to $24 million from $33 million last year due to unusually high finance…

[Operator Instructions] Your first question comes from the line of Justin Clare with ROTH MKM.

Hi, everyone. First off, I just wanted to start on module supply. I was wondering, since the announcement of the latest AD/CVD case that's targeting Southeast Asian countries, can you talk about whether you're seeing any change in the market so far? You mentioned pricing is down to $0.25 a watt. Are you seeing that change? Are you seeing it move higher at this point? And then if tariffs were placed on both cells and modules from Southeast Asia, can you just talk about your ability to access supply and whether you see any potential for disruption to your product time lines?

Certainly on our mind, something we've been spending a good amount of time on as we work through details related to supply chain. So specifically, we're seeing the market remain fairly stable in terms of supply and pricing. There is some shuffling going on and certainly, some of that shuffling is an increased emphasis on investment in the U.S. and acceleration on those investments by producers who are looking to increase U.S. content as the demand is there and there's likely need for that in the future. In the meantime, we're seeing a mix in terms of our supply chain that is manageable given the outcomes, especially given our emphasis on non-targeted Southeast Asia supply. That said, we also have a solid set of relationships and work related to supply out of the U.S. that would allow us to size-step eventual issues. With some cost impact, but it's a manageable amount of cost impact, a few pennies of cost impact to us and then to the projects. Of course, the benefit there is additional opportunity related to domestic content and the upside related to domestic content if that shift occurs. So we see this in large part, a neutral topic in the near term and potentially in the longer term, accelerating the shift to domestic supply that will, in fact, benefit the projects.

I will add 2 short points to that. First, in general, we still see a positive trend in terms of the panels pricing. So, we see them still going down and then offsetting some of the other elements and it's worth to mention the strategic step we did last year with Waaree, the Indian supplier and the MSA that we have with this supplier that allows us very good responsiveness to the AD/CVD future steps that will be taken. So we have a good source that we believe will be available.

Just to follow on that with the domestic content adder, can you talk about the timing potential in which you think you could secure that out on the solar side of the business, but then also for storage projects as well. I am curious what the time frame might be?

We are aligning some of our projects in order to get more from the domestic content, especially in projects where the tax equity path will be ITC, then we see a strong benefit for that. For example, Rustic Hills and we believe that for '27, we will be on track to get the adder on that.

We've seen obviously a very strong increase in demand for electricity from data centers, wondering if you're looking to participate in RFPs that are being done from data centers and whether or not those might incorporate solar and storage?

I think it's a great question. We see a very positive environment for us right now that is being created in the U.S. because of the data center growth that leads to this increase in electricity demand primarily and also opens up a lot of opportunities for us also in the business model. So it's not only participating in PPAs, we are reviewing and exploring other business development and even M&A options that are related to this trend, which we believe that will be long term.

In the West, which is obviously power constrained and with big data center builds over the next decade, that is contracted via the utility. So the utility will leave the corporate demand through a PPA direct with the utility. So we won't see it in an RFP with the data center providers directly. We'll see it with increased demand from the utilities and just given the interconnection positions we hold in the West, we think that puts us in a really position to deliver in the near term for those data center clients, which is a huge value to them.

Your next question comes from the line of Maheep Mandloi from Mizuho.

Just on the module procurement, can you talk about the sourcing. You talked about Waaree being one of the word big ones, are you looking solar cells from them or potentially modules from their potential expansion in the U.S.? Or do you have any other suppliers lined up for that as well?

Our relationship with Waaree includes solar cells and Waaree is a producer of solar cells. Their produced solar cells are part of our sourcing plan with them and our contractual relationship. We're continuing to look at the advent and introduction of solar cells in the U.S., and that's a longer-term equation, i.e. 2027 time frame for projects and domestic content that Gilad was referencing. We're targeting that time frame to be careful, though, we're, of course, open to and working on accelerating as much as possible as it relates to other projects and opportunities that might pull us in a little earlier than that, but 2027 is really the reasonable time frame that we're looking at to include U.S. sales.

You kind of talked about everything seems the target on track, but curious on your thoughts on how should we think about going forward? Do you expect any bottlenecks over here on a run rate basis, either from EPC constraints or transformer switchgear constraints. For the market, then we're obviously hearing from some of the suppliers that projects are getting pushed out. But just curious, why you're not seeing that right now? And what are your expectations for that going forward?

This is a great question. I think that we are very confident right now on the operational track, First on Atrisco, that is a major project for us, and we plan the COD of both the solar side and the battery side before the end of '24, and we are at least on track. I believe that we took a very important operational and procurement decisions that will also support construction on time of the new projects that we are going to build in the U.S. in '24, including decision for transformers that we did and other elements that can be bottlenecked. So we feel quite confident right now on our plans.

If I may add to Gilad's point, I think all those projects have signed interconnection agreements, signed PPAs, real estate and for the large part, all their permits. So that gives us a large degree of comfort on the milestones that these projects have achieved that were on plan, if not ahead.

Then maybe just one last one on merchant pricing in Spain, the table in the press release is pretty useful to understand the sensitivity. The spot prices in Spain are almost around EUR 30 right now per MWh, almost 50% below your assumption of 68.5% that imply like EBITDA could be 2% below the midpoint for the rest of the year.

The current price today may be EUR 30, but if you look at the forwards for the remainder of the year, they're in the 70% range, if not higher. So there's been kind of a short-term decline in power prices, which we've seen in February and mostly in March, which has been driven by strong hydro and a lot of wind and solar resource. The hydro was expected to come off, which is why you see the near-term future is at the 70% range, July, August, September and so on and so forth. So the 30 is maybe today's price, but it's not the expectation of price in the market for the remainder of the year. I would add to that is that the point we are making in the presentation is our resilience to even a short-term downturn in the spot prices in Spain and the point that we just have shown is that even in a reduction of 50% in the merchant prices, we don't see any impact on the EBITDA. The opposite, what we see is positive results in other projects. So, we do not see any reason why to reduce our guidelines, maybe to the opposite but we will consider that next quarter. On the long term, we see also in Spain, very good forecast and forward for the electricity prices, including PPAs. So, the fact that we get offers right now for 10 years PPA on a high basis provide us a lot of confidence that we can either remain in the merchant profile where we have benefited a lot in the last 2 years, and basically being able to withdraw more than 50% of the equity of the project. We had a very good up in the last 2 years and what we see currently forward for the next 10 years is good levels of prices and also flexibility to sign long-term PPA at high levels that represent higher returns than the original model. So I think that we stand there with very good situation. In Spain, I think this was the goal of showing that table on the filter.

Your next question comes from the line of Mark Strouse with JPMorgan.

This is Michael Fairbanks on for Mark Strauss. For the U.S. development pipeline, how are you feeling about the availability of tax equity, particularly on the PTC side. We've heard some tightness there. So just wondering, if you're seeing that and to what extent can you use transferability to offset that?

I think the profile of our offtake rest of the fundamentals, but primarily offtake of our project in the West is very attractive to tax equity providers because we have long-term busbar PPAs for 20 and in some projects, 30 years with a very solid profile. So as produced, we don't have any exposure to curtailment as opposed to have set of PPAs that you can find in other areas. So this leads to a very strong demand that we are getting for tax equity for the project. So we feel less the bottlenecks right now and I think that this is one of the advantages of the portfolio that we see right now in [indiscernible] and specifically with the project online right now.

There's also the optionality that transferability has provided to do the hybrid structures, which is around the tax equity provider syndicating the credits to corporate clients of theirs, which have tax exposure and then retaining the interest for the purposes of monetizing the depreciation. So, there's plenty of demand. It's just a matter of exactly the structure that works best for us.

Any update you guys have on the overall ramp-up at the Genesis the wind projects since the last call?

It's on plan and even better than planned. We see improved performance of both plants and also we are getting to continuous arrangement with the supplier in the past. So, we feel very good there.

[Operator Instructions]. Your next question comes from the line of David Paz with Wolfe Research.

I wanted to just circle back on the PJM portfolio that you touched on it. If you could maybe at a high level talk about your plans in that market, and in particular, all the demand that of course, we're seeing from data centers and so forth. Do you anticipate, as part of your farm-down strategy, I think it was 30% or so on going forward, just one of those kind of portfolios that we should look at, what kind of interest are you seeing and are you particularly looking at breaking it down pieces or that you mentioned on your one of your earlier comments on M&A, just maybe overall, just address your PJM strategy.

First, to begin with, we continue to advance the PJM portfolio. It has advanced well. We have more than 5 projects there, but with 5 projects, we are on fast track and with network operate cost of less than $5 million per project, which I think is a fantastic for PJM. I understand that on the fast track, Enlight holds 40% of the project right now that are on the fast track on PJM. I think it is amazing. Then, to your question, yes, we believe that PJM is a potential for our strategy on the sell down. There are some elements in PJM were, [indiscernible] project is good. Options for doing this kind of equity recycle we mentioned in previous quarter when the project finally completely matures and get to their optimal value, we believe that the high PPA prices in PJM derived by the data centers demand and multiple players that are interested in projects there may create a very high upside for us in this market.

Just on your unlevered return target for your '24 to '26 portfolio, obviously, that was great to see a 50 basis point improvement. How locked in from here, are those returns? Do you anticipate more movement, just with those set of projects on your returns or if you walked in the pricing and so forth that we should probably kind of think of that in a steady state?

PPAs are signed for over 90% of that block. So the revenue side, obviously, we feel great degree of confidence. On the cost side, we're naturally going to procurement in a significant way, and on everything, we're going to obviously start building this year. So we're in advanced negotiations on procurement decisions. For example, on the 3 big projects in the U.S. that we're going to commence construction this year, naturally we have the Atrisco project where procurement is obviously all done and that's locked in. Yes, we feel pretty good. I think the CO Bar, which is obviously a big project, which we hope to make some procurement decisions by the end of this year, early next.

That concludes our question-and-answer session and I will now turn the call back over to Yosef for closing remarks.

Thank you, operator. Thanks, everyone for joining today. We will be at the JPMorgan Energy Conference in New York as well as ROTH Sustainability Conference in London, and we look forward to catching you up there. Thank you.

This concludes today's conference call. Thank you for your participation and you may now disconnect.