MB notes on Altenergy’s BDO TradeTalk

The following are notes that we took from the TradeTalks webinar with Alternergy [ALTER 0.87 unch; 81% avgVol], hosted by Jonathan Latuja of BDO Securities. Representing ALTER were Vince Perez (Chairman), Gerry Magbanua (President), and Maria Carmen Diaz (CFO). The first part of the talk was an overview of ALTER’s growth plan to reach 500 MW of installed capacity by 2026, with some financial highlights like its 167% increase in cash reserves driven by various fundraising efforts.

The question and answer part of the talk was the most interesting, as it allowed viewers to get a better feel for ALTER’s approach and its pitch to investors.

> Shared risk with investors:  When Mr. Perez was asked what ALTER does differently compared to other renewable energy developers, his answer was, “We’re not part of a conglomerate; we are the founders. Everyone of the public float of 34%, the other 66% are the management team, so we’re very focused on shareholder value.” He also said that while ALTER is not a massive corporation, it’s big enough to contain all the important moving parts of one (engineers, scientists, project management, bankers, lawyers, etc) which allows ALTER to “do an entire project from design, concept, to construction and operation” while retaining the sense that ALTER is “mobile” and responsive to change.

> Life beyond 500 MW:  When asked about how close ALTER is to achieving its 500 MW goal, Mr.

Perez said that they’re “easily two-thirds on our way to the 500 MW [goal]”, but that ALTER’s goal is to “actually reach far more than that.” Mr. Perez said that ALTER has had “multiple inquiries from others whether we could partner with them, joint venture with them, and those are approaches that we’re closely entertaining.” Mr. Perez added later that its management team has considerable experience in investment banking, and has already had “closed-door sessions” on how to fund the next 500 to 1000 MW of development, including “actively talking to folks both locally and overseas.” 

> Development challenges:  A common theme of ALTER’s responses was in how it values LGU outreach as part of its competitive advantage.