Atlantica Sustainable Infrastructure Annual Report 2014

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FY2014 Annual Report · Atlantica Sustainable Infrastructure

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Company Registration No. 08818211

ABENGOA YIELD PLC

Annual Report and Financial Statements

For the year ended December 31 2014

Abengoa Yield Plc individual Annual Report and Financial Statements

ABENGOA YIELD PLC
Contents

Staff costs

Significant accounting policies

Strategic Report
Directors’ Report
Events after the balance sheet date
Director’s Remuneration Report
Directors’ Responsibilities Statement
Independent auditor’s report to the members of Abengoa Yield plc
Income Statement
Balance Sheet
Statement of changes in equity
Cash flow statement
Notes to the financial statements
1. General information
2. Adoption of new and revised Standards
3.
4. Critical accounting judgements and key sources of estimation uncertainty
5.
Profit for the year
6. Auditor’s remuneration
7.
8. Operating revenue
9.
Finance costs
10. Other gains and losses
11. Tax
12. Dividends
13.
14. Amounts owed by group undertakings
15. Borrowings
16. Trade and other payables
17. Share capital, share premium and distributable reserves
18. Retained earnings
19. Notes to the cash flow statement
20. Financial Instruments
21. Events after the balance sheet date
22. Related party transactions
23. Contingent liabilities
24. Guarantees and commitments
25. Service concessional arrangements
26. Controlling party

Investments in subsidiaries

3
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58

ABENGOA YIELD PLC
Strategic Report

Strategic Report

This Strategic Report has been prepared solely to provide additional information to
shareholders to assess the company’s strategies and the potential for the strategies to
succeed.

The Strategic Report contains certain forward-looking statements. These statements are
made by the directors in good faith based on the information available to them up to the
time of their approval of this report and such statements should be treated with caution due
to the inherent uncertainties, including both economic and business risk factors, underlying
any such forward-looking information.

The directors, in preparing this Strategic report, have complied with Section 414C of the
Companies Act 2006.

The Strategic Report discusses the following areas:

 Nature of the business

 Business model, strategy and objectives

 Fair review of the business

 Key performance indicators

 Principal risks and uncertainties

 Corporate social responsibility

 Future developments

 Going concern basis

Nature of the business

Abengoa Yield plc (‘Abengoa Yield’ or the ‘Company’) was incorporated in England and
Wales as a private limited company on 17th December 2013 under the name Abengoa Yield
Limited. On 19th March 2014, Abengoa Yield plc was re-registered as a public limited
company, under the name Abengoa Yield plc.

Abengoa Yield is a total return company formed to serve as the primary vehicle through
which Abengoa S.A. (‘Abengoa’ or ´the parent´, our main shareholder indirectly through
Abengoa Concessions Investment Ltd.) owns, manages, and acquires renewable energy,
conventional power, electric transmission lines, and other contracted revenue-generating
assets, initially focused on North America (United States and Mexico) and South America
(Peru, Chile, Brazil and Uruguay), as well as Europe (Spain in the first instance).

ABENGOA YIELD PLC
Strategic Report

Events during the period
On 18th June 2014 Abengoa Yield closed its initial public offering on the NASDAQ market in
the United States, issuing 28,577,500 ordinary shares.

Prior to the consummation of this offering, Abengoa contributed directly or indirectly,
through a series of transactions, ten contracted assets, certain holding companies and a
preferred equity investment. As consideration for the asset transfer, Abengoa received a
64.28% interest in Abengoa Yield and $655.3 million in cash, corresponding to the net
proceeds of the initial public offering less $30 million retained by Abengoa Yield for liquidity
purposes. Abengoa Yield’s shares began trading on the NASDAQ Global Select Market
under the symbol “ABY” on 13th June 2014.

During June 2014, Abengoa Yield signed an exclusive agreement with Abengoa, referred to
as the ‘ROFO Agreement’, which provides the Company with a right of first offer on any
proposed sale, transfer or other disposition of any of Abengoa’s contracted renewabl e
energy, conventional power, electric transmission or water assets in operation and located in
the United States, Canada, Mexico, Chile, Peru, Uruguay, Brazil, Colombia and the
European Union, as well as four assets in selected countries in Africa and the Middle East.
We refer to the contracted assets subject to the ROFO Agreement as the ‘Abengoa ROFO
Assets’.

In September 2014, pursuant to the ROFO Agreement, the Company agreed to acquire
from Abengoa (i) a solar power plant in Spain, Solacor 1/2, with a capacity of 100 MW; (ii) a
solar power plant in Spain, PS10/20, with a capacity of 31 MW; and (iii) one on-shore wind
farm in Uruguay, Cadonal, with a capacity of 50 MW. The acquisition of these assets was
completed during December 2014 with the total consideration paid amounting to $312
million.
On 5th November 2014 the Company announced a proposed offering of $255 million in
aggregate principal amount of senior notes (the “Notes”) due 2019, and the closing and
disbursement of funds took place on 17th November 2014. The Notes accrue annual interest
of 7% payable semi-annually.
On 4th December 2014 the Company announced the closing of a four year credit facility
with a number of banks in the amount of $125 million at a cost of Libor + 275 basis points.
On 11th December 2014 Abengoa announced a secondary public offering of Abengoa Yield
shares. On 22nd January 2015, Abengoa closed an underwritten public offering and sale in
the United States of 10,580,000 of our ordinary shares for total proceeds of $327,980,000
(or $31 per share) before underwriting fees and expenses. After the sale, Abengoa’s
shareholding in the Company was reduced to 51%.

ABENGOA YIELD PLC
Strategic Report

Asset portfolio
The portfolio of assets which are owned by Abengoa Yield as of 31st December 2014
consists of six renewable energy assets, a cogeneration facility, and several electric
transmission lines, all of which are fully operational. All the assets have contracted revenues
(regulated revenues in the case of the Spanish assets) with low-risk off takers, and have an
average remaining contract life of approximately 25 years on 31st December 2014.

The contracts are generally fixed-priced and pursuant to rates revised based on inflation or
similar types of public indexes. Over 90% of project-level debt is hedged against changes in
interest rates through an underlying fixed rate on the debt instrument or through interest
rate swaps, caps, or similar hedging instruments.
The following table provides an overview of the current assets of the Company as of 31st
December, 2014:

Our Assets

Type

Ownership

Location Currency

Solaben 2 & 3 Renewable

70%2

Spain

Euro

2x50 MW

BBB/Baa2/BBB+

100%
Class B1
100%

Arizona
(USA)
California
(USA)

USD

Capacity
(Gross)

Counterparty
Credit
Ratings(3)

COD/
Expected
COD

280 MW

A-/A3/BBB+

4Q 2013

280 MW

BBB/A3/BBB+

4Q 2014

100%

Uruguay

USD

50 MW

BBB-/Baa2/BBB- 2Q 2014

100%

Uruguay

USD

50 MW

BBB-/Baa2/BBB- 4Q 2014

74%4

Spain

Euro

2x50 MW

BBB/Baa2/BBB+

100%

Spain

Euro

31 MW

BBB/Baa2/BBB+

100%

Mexico

USD

300 MW

BBB+/A3/BBB+

2Q 2012 &
4Q 2012

1Q 2007 &
2Q 2009
2Q 2013

100%

Peru

USD

362 miles

BBB+/A3/BBB+

1Q 2011

100%

Peru

USD

569 miles

BBB+/A3/BBB+

1Q 2014

100%

Chile

USD

43 miles

N/A

2Q 2014

100%

Chile

USD

38 miles

N/A

1Q 2014

100%

Chile

USD

6 miles

BBB+/Baa2/BBB+ 4Q 2007

Contract
Years Left

Solana

Mojave

Palmatir

Cadonal

Renewable
(Solar)
Renewable
(Solar)

Renewable
(Wind)

Solacor 1 & 2

PS10/20

ACT

ATN

ATS

Quadra 1

Quadra 2

Palmucho

(Solar)

Renewable
(Solar)

Renewable
(Solar)
Conventional
Power

Transmission
line

Transmission
line
Transmission
line
Transmission
line

Transmission
line

(1) On 30th September 2013, Liberty Interactive Corporation invested $300 million in Class A membership interests in exchange for a
share of the dividends and taxable loss generated by Solana. As a result of the agreement, Liberty Interactive Corporation will
receive 54.06% of both dividends and taxable loss generated during a period of approximately five years; such percentage will
decrease to 24.05% thereafter.

(2)

(3)

(4)

Itochu Corporation holds 30% of the economic rights to each of Solaben 2 and Solaben 3.

Reflects the counterparty’s credit ratings issued by Standard & Poor’s Ratings Services, or S&P, Moody’s Investors Service Inc., or
Moody’s, and Fitch Ratings Ltd, or Fitch.

JGC Corporation, a Japanese engineering company, holds 26% of the shares in each of Solacor 1 and Solacor 2. The Company
holds a 30-year right of usufruct over the remaining shares of Solacor 1 and Solacor 2 and a call option to purchase such shares for
one euro during a four-year term

ABENGOA YIELD PLC
Strategic Report

Asset portfolio (continued)

In addition to the assets listed above, the Company owns a preferred equity investment in
Abengoa Concessions Brasil Holding (‘ACBH`), a subsidiary holding company of Abengoa,
that is engaged in the development, construction, investment and management of
contracted concessions in Brazil, consisting mostly of electric transmission lines.

The Company has no branches outside the UK.

Business model, strategy and objectives

We are a company formed to serve as the primary vehicle through which Abengoa owns,
manages and acquires renewable energy, conventional power and electric transmission lines
and other contracted revenue-generating assets, initially focused on North America (the
United States and Mexico) and South America (Peru, Chile, Uruguay and Brazil), as well as
Europe (Spain). In the future, we intend to expand this presence to selected countries in
Africa and the Middle East.

We intend to take advantage of favourable trends in the power generation and electric
transmission sectors globally, including energy scarcity and a focus on the reduction of
carbon emissions. To that end, we believe that our cash flow profile, coupled with our scale,
diversity and low-cost business model, offers us a lower cost of capital than that of a
traditional engineering and construction company or independent power producer and
provides us with a significant competitive advantage with which to execute our growth
strategy.

With this business model, our objective is to pay a consistent and growing cash dividend to
holders of our shares that is sustainable on a long-term basis. We expect to target a pay-out
ratio of approximately 90% of our cash available for distribution and will seek to increase
such cash dividends over time through organic growth and as we acquire assets with
characteristics similar to those in our current portfolio.

We are focused on high-quality, newly-constructed and long-life facilities with creditworthy
counterparties that we expect will produce stable, long-term cash flows. We have signed an
exclusive agreement with Abengoa, which we refer to as the ROFO Agreement, which
provides us with a right of first offer on any proposed sale, transfer or other disposition of
any of Abengoa’s contracted renewable energy, conventional power, electric transmission
or water assets in operation and located in the United States, Canada, Mexico, Chile, Peru,
Uruguay, Brazil, Colombia and the European Union, as well as four assets in selected
countries in Africa and the Middle East.

Based on the acquisition opportunities available to us, which include the Abengoa ROFO
Assets as well as any third-party acquisitions we pursue, we believe that we will have the
opportunity to grow our cash available for distribution in a manner that would allow us to
further increase our cash dividends per share over time.

ABENGOA YIELD PLC
Strategic Report

A fair review of the business

During the first year of operation the Company has focused on three priorities:

1. Creating, in the case of new assets, and reinforcing, in the case of others, the
processes and systems required to manage and control our contracted assets
internationally;

Bringing into service and ramping up a number of new assets, including ATS, Quadra
1 & 2, Palmatir and Mojave, our 280 MW solar plant in California;

3. Acquiring three new assets from Abengoa ahead of our original plans. This will allow
the Company to have a full year of dividend returns in 2015 in relation to the
following three assets:



Solacor 1 & 2, two solar plants in Spain with 100 MW total capacity that have
been in operation since 2012 and of which the Company now owns 74% of
capital.

PS 10/20, two solar assets in Spain that have been in operation for over six years.

Cadonal, a new wind farm with a 50 MW capacity in Uruguay, that has a 20 year
power purchase agreement with the local utility.

With the fleet of assets we own at the end of 2014 we believe that we have achieved a
balanced portfolio in terms of geographies and technologies that provides the Company the
critical mass required to continue capturing opportunities to (i) continue improving the
performance and cash generation of our assets, most of which are still in their early stages
of operation and (ii) continue growing through acquisitions from Abengoa and others.

In 2014 the Company has closed with revenues of $24.0 million (2013: nil) and a profit for
the year of $8.4 million (2013: nil). Revenue includes dividend income and interest
receivable on loans to subsidiaries.

Revenues
Ebit (i)
Net Profit

2014
24.0
8.2
8.4

2013
-
-
-

(i)Ebit is defined as earnings before interest and taxation

The Company has closed the year with a corporate cash available position of $155.4 million
(2013: nil). The increase in cash primarily results from the issue of bonds and the securing of
credit facility loans, offset by the purchases of assets during the period. With this amount of
cash we plan to pay further dividends to our shareholders and to acquire new assets.

During 2014 the Company paid dividends of $0.2962 per share (2013: nil).

ABENGOA YIELD PLC
Strategic Report

Key performance indicators

Abengoa Yield plc is a company that owns and manages operating assets in the renewable
energy, conventional power, electric transmission lines and water business sectors. The key
performance indicators of the operating subsidiaries are:

Key Performance Indicator

As of December 31,
2013

2012

2014

Renewable energy
MW in operation ...............................................................................................
GWh produced .................................................................................................

891
902

380
280

Conventional power
MW in operation ...............................................................................................
GWh produced .................................................................................................
Availability (%) ..................................................................................................
Electric transmission lines
Miles in operation..............................................................................................
Availability ........................................................................................................

300
2,474
101.9%

1,018
99.1%

300
1,849
97.0%

368
99.6%

100
75

—
—
—

368
99.2%

The key performance indicators of the Company itself are dividends per share and net profit,
both of which are discussed in the business review section above.

Principal risks and uncertainties

The Company and its underlying assets are subject to a number of risks ranging from
operating to regulatory and financial. The processes and systems implemented have been
designed to mitigate those risks to the extent possible. We include the following table as a
summary of some of those risks and actions take to mitigate them:

Risk

Impact

Operations in each asset

Loss of revenues and cash
flows at the project
company level, which has
subsequent impact on
cash returns to the
Company

Assessment of change
in risk year-on-year

Operational risks are
higher in younger assets
than in more mature
ones and likely to remain
similar in the next few
years

Regulation/counterparty
risk in each asset

Loss of revenues and cash
flows at the project
company, which has a
subsequent impact on
cash returns to the
Company

No material changes for
the underlying assets.
The risk has increased for
the Company following
its acquisitions

Mitigation of risk

 Dedicated supervisory
and management
teams

 Reporting and

monitoring systems in
place

 Operation and

maintenance contracts
with specialists

 Support from Abengoa
 Investment grade

ratings in most of our
assets

 Strong power purchase

agreement or
concession contracts in
most assets

ABENGOA YIELD PLC
Strategic Report

Principal risks and uncertainties (continued)

Risk

Impact

Legal, environmental and
compliance in each asset

Economic penalties, new
investments or inability to
operate assets

Financing agreements in
each contract

Interest rate

Restrictions to distribute
cash out of project
companies or potential
default of project or
corporate companies

Higher interest expenses
at project companies or
at corporate level

Assessment of change
in risk year-on-year
Not material changes for
the underlying assets.
The risk has increased for
the Company following
its acquisitions

No material changes for
the underlying assets.
The risk has increased for
the Company following
the issue of debt in the
period
No material changes for
the underlying assets.
The risk has increased for
the Company following
the issue of debt in the
period.

Currency risk

Lower cash flow in USD

Higher in the case of euro

Mitigation of risk

 Team dedicated to

compliance on each
asset

 Reporting and

monitoring systems

 Abengoa support
 Monitoring of

covenants in each
contract

 Team dedicated

 Over 90% of interest

hedged over the life of
debt at project level
 Bond issued at fixed

rate

 Credit facility 100% to

be hedged

 Over 80% of cash

flows in USD

 Over 80% of cash

flows generated by our
project companies are
denominated in USD

 Policy to hedge in

order to have a 90% at
least of cash flows
generated by our
project companies in
USD or hedged to USD

Liquidity risk

Not being able to meet
debt service or dividend

No material changes

 Processes and systems

in place

 Cash in hand
 10% of cash flows
generated by our
project companies and
distributed to the
holding company
retained

 Possibility to change

dividend policy

ABENGOA YIELD PLC
Strategic Report

Corporate and social responsibility

For Abengoa Yield, sustainability is one of the pillars of the company strategy. Abengoa
Yield activities are geared towards achieving sustainable development and management
thereof seeks to reduce the environmental footprint of our activities.

Abengoa Yield has established a number of environmental policies that ensure that the
Company complies with existing regulation in each of our markets but that additionally it
monitors and measures its environmental impact and identifies and implements action plans
to reduce that impact at each of our facilities.

Abengoa Yield has implemented a methodology, based on the Intergovernmental Panel of
Climate Change and the Greenhouse Gas protocol, to identify and track greenhouse gas
emissions through all our activities including our suppliers. Abengoa Yield follows up these
emissions periodically and establishes, together with our partners and suppliers, actions
plans to reduce the environmental impact of our activities.

In 2014, Abengoa Yield’s emissions were irrelevant as the company did not directly own
assets that generate emissions and had no employees.

Abengoa Yield is committed to create a positive impact in the local communities where the
company developed its activities. Abengoa Yield fosters its social commitment and
responsibility to its employees and to the communities in which they are located, through
the development and collaboration in corporate social responsibility programs and the
creation of highly qualified jobs in these communities. Additionally, in order to guarantee
the respect of our social and environmental standards, Abengoa Yield requires its suppliers
and partners to adhere to our Social Responsibility Code.

As of December 2014, our management team and employees were employed by Abengoa
and supported Abengoa Yield through the existing executive services and support services
agreements. Nevertheless, we are in the process of implementing policies to ensure that we
recruit and develop minorities in our different geographies to encourage a diverse team. As
of 31st December 2014, 10% of our directors are women and approximately 20% of our
management team are women. The percentage of women out of total employees as of 31st
December is irrelevant as the Company had no employees.

It is also important to highlight the constant preoccupation in our corporate culture for the
safety of our teams, operations and suppliers around the world, which is managed through
a strict system of quality and occupational health and safety at every level of the
organization.

Future Developments

In February 2015, pursuant to the ROFO Agreement, the Company agreed to acquire from
Abengoa a stake in (i) two water desalination plants in Algeria, Honaine and Skikda, with an
aggregate capacity of 10.5 million cubic feet per day; (ii) an 81-mile transmission line in
Peru, ATN2; (iii) a solar power asset in Spain, Helioenergy 1/2, with a capacity of 100 MW;
and (iv) a solar power asset in the United Arab Emirates, Shams, with a capacity of 100 MW.
On 3rd February 2015, the Company completed the acquisition of a 25.5% stake in Honaine
and a 34% stake in Skikda.

ABENGOA YIELD PLC
Strategic Report

Future Developments (continued)

The completion of the acquisition of ATN2, the 30% stake in Helioenergy 1/2 and the 20%
stake in Shams is subject to satisfaction of customary conditions, including approvals from
financing institutions and, in certain cases, from partners in joint ventures.

For 2015 we expect to continue growing thanks to the acquisitions closed in late 2014 (two
solar platforms and a wind farm), to the acquisitions announced in early February 2015
(participations in two solar assets, two water desalination facilities and a transmission line)
and to further acquisitions that we expect to make in 2015.

As a result of these acquisitions our priority in 2015 will be to continue to improve our
systems and processes in order to manage a diverse fleet of assets while maximising cash
flow generation. Additionally, raising financing resources for some of the expected
acquisitions will be key.

Additionally, we will be implementing during 2015 a number of changes in our corporate
governance that were announced in December 2014 and we expect to close the year 2015
with Abengoa holding a very large but non-controlling interest in Abengoa Yield. Our ROFO
Agreement with Abengoa should continue to be a major source of growth.

Going Concern Basis

The Company’s business activities, together with the factors likely to affect its future
development, performance and position are set out within this report. During the period,
the Company generated $ 6.9 million from operating activities, invested $ 230.9 million in
acquisitions and raised $ 379.4 million from financing activities after paying dividends. All of
these resulted in a $ 155.4 million increase on our cash position by the year end, with a
closing cash position of that amount. The directors believe that this is above the level of
cash needed to operate the business for the foreseeable future and meet the Company’s
liabilities as they fall due, as well as being used as a significant part of the cash required to
make the acquisitions of the assets announced in February 2015.

In addition, the Company has entered into a Financial Support Agreement under which
Abengoa has agreed to facilitate a US$50m revolving credit line and maintain any
guarantees and letters of credit that have been provided by it on behalf of or for the benefit
of Abengoa Yield and its affiliates for a period of five years.

The Company is also in a net asset and net current asset position. Therefore the directors
continue to adopt the going concern basis of accounting in preparing the financial
statements.

Approval

This Strategic report was approved by the board and signed on its behalf by Santiago Seage,
CEO on 23rd February 2015.

ABENGOA YIELD PLC
Directors’ Report

Directors’ Report

The directors present their annual report on the affairs of the Company, together with the
financial statements and auditor’s report, for the year ended 31 December 2014.

Details of significant events since the balance sheet date are contained in note 21 to the
financial statements. An indication of likely future developments in the business of the
Company and details of research and development activities are included in the Strategic
Report.

Information about the use of financial instruments by the company is given in note 20 to
the financial statements.

Greenhouse Gas Emissions (GHG) Reporting

Due to the fact that in 2014 the Company had no employees and that it did not own
material assets directly our GHG emissions were not relevant. From 2015 we will be
measuring emissions and will be reporting them.

Dividends
On 14th November 2014, the Company declared the first quarterly dividend corresponding
to the third quarter of 2014, as well as a pro-rata dividend corresponding to the number of
days since the initial public offering to June 30 2014, amounting to $0.0370 per share. The
dividend was paid on December 15 2014. During the year 2014, the total dividend paid
amounted to $0.2962 per share, being a total payment of $ 23.7 million.
The board of directors declared a second quarterly dividend on 23rd February, 2015 of
$0.2592 per ordinary share to be paid on or around 16th March 2015 to ordinary
shareholders on the register on 28th February 2015. Together with the interim dividends of
$0.2592 per share and $0.0370 per share, this makes a total of $0.5554 dividend per share
declared for the year 2014.

Capital Structure

Details of the authorised and issued share capital, together with details of the movements in
the Company's issued share capital during the year are shown in note 17. The Company has
one class of ordinary share which carry no right to fixed income. Each share carries the right
to one vote at general meetings of the Company.

There are no specific restrictions on the size of a holding nor on the transfer of shares,
which are both governed by the general provisions of the Articles of Association and
prevailing legislation. The directors are not aware of any agreements between holders of the
Company's shares that may result in restrictions on the transfer of securities or on voting
rights.

The Company participates in no employee share schemes. No person has any special rights
of control over the Company's share capital and all issued shares are fully paid.

With regard to the appointment and replacement of directors, the Company is governed by
its Articles of Association, the SEC listing rules, the UK Companies Act 2006 and related
legislation. The Articles of Association themselves may be amended by special resolution of
the shareholders. The powers of directors are described in the Main Board Terms of
Reference, copies of which are available on request.

ABENGOA YIELD PLC
Directors’ Report

Directors

The directors, who served throughout the year since the date indicated, and to the date of
this report, were as follows:

 Manuel Sanchez Ortega Director and Chairman of the Board Appointed 17 December 2013

 Santiago Seage

Chief Executive Officer and Director Appointed 17 December 2013

 William B. Richardson

Director

 Javier Garoz

Director

 María J. Esteruelas

Director

 Eduardo Kausel

Director, independent

 Daniel Villalba

Director, independent

 Jack Robinson

Director, independent

 Enrique Alarcon

Director, independent

 Juan del Hoyo

Director, independent

Appointed 13 June 2014

Appointed 23 February 2015

Appointed 13 June 2014

Directors’ appointments are proposed to the appointments and remuneration committee,
currently Mr. Sanchez, Mr. Alarcon and Mr. Villalba, and the committee makes a proposal to
the board of directors, who would nominate.

The board of directors have wide powers to manage the Company. For issuing and buying
back shares the board will be requesting approvals with maximum limits at the forthcoming
general shareholders meeting.

Directors’ indemnities

The company has made qualifying third party indemnity provisions for the benefit of its
directors which were made during the year and remain in force at the date of this report.

Political contributions

No political donations were made during the year. (2013: US$nil.)

Substantial shareholdings

During the period between 31 December 2014 and as of the date of this report the
Company did not receive any notifications under chapter 5 of the Disclosure and
Transparency Rules.

ABENGOA YIELD PLC
Directors’ Report

Auditors

Each person who is a director at the date of approval of this annual report confirms that:



so far as the director is aware, there is no relevant audit information of which the
company's auditors are unaware; and

the director has taken all the steps that he/she ought to have taken as a director in order
to make himself/herself aware of any relevant audit information and to establish that the
company's auditors are aware of that information.

This confirmation is given and should be interpreted in accordance with the provisions of
Section 418 of the Companies Act 2006.

Deloitte have expressed their willingness to continue in office as auditors and a resolution to
reappoint them will be proposed at the forthcoming Annual General Meeting.

Events after the balance sheet date

On 22nd January 2015, Abengoa closed an underwritten public offering and sale in the
United States of 10,580,000 of Abengoa Yield´s ordinary shares for total proceeds of
$327,980,000 (or $31 per share). Abengoa continues to beneficially own a majority of our
outstanding shares but, as a result of such offering, reduced its stake in Abengoa Yield from
approximately 64.3% to 51.1%.

In February 2015, pursuant to the ROFO Agreement, the Company agreed to acquire a
second set of assets from Abengoa (the “Second Dropdown”), which comprise an
aggregate of 200 MW of solar power generation, 10.5 million cubic feet per day of water
desalination and an 81-mile transmission line. The Second Dropdown Assets consist of (i)
two water desalination plants in Algeria, Honaine and Skikda, with an aggregate capacity of
10.5 million cubic feet per day; (ii) an 81-mile transmission line in Peru, ATN2; (iii) a solar
power asset in Spain, Helioenergy 1/2, with a capacity of 100 MW; and (iv) a solar power
asset in the United Arab Emirates, Shams, with a capacity of 100 MW. On 3rd February
2015, the Company completed the acquisition of a 25.5% stake in Honaine and a 34%
stake in Skikda. The completion of the acquisition of ATN2, the 30% stake in Helioenergy
1/2 and the 20% stake in Shams is subject to satisfaction of customary conditions, including
approvals from financing institutions and, in certain cases, from partners in joint ventures.

This report was approved by the board of directors on 23 rd February 2015 and signed on its
behalf by Santiago Seage, CEO.

ABENGOA YIELD PLC
Directors’ Remuneration Report

Director’s Remuneration Report

Introduction

This report is on the remuneration of the directors of Abengoa Yield Plc for the period to 31
December 2014. It sets out the remuneration policy and remuneration details for the
executive and non-executive directors of the company. It has been prepared in accordance
with Schedule 8 of The Large and Medium-sized Companies and Groups (Accounts and
Reports) Regulations 2008 as amended in August 2013. This is the first time the Company
has prepared the report in accordance with the amended Regulations.

The report is split into three main areas:



the statement by the chair of the remuneration committee;

the annual report on remuneration; and

the policy report.

The Companies Act 2006 requires the auditors to report to the shareholders on certain parts
of the Directors’ Remuneration Report and to state whether, in their opinion, those parts of
the report have been properly prepared in accordance with the Regulations. The parts of the
annual report on remuneration that are subject to audit are indicated in that report. The
statement by the chair of the remuneration committee and the policy report are not subject
to audit.

Statement by the Chair of the remuneration committee

During our first six months of operation as a committee we have focused on creating the
committee including a majority of independent directors (Mr. Alarcon and Mr. Villalba) and
supervising the process to transfer in early 2015 our executive team and some other key
employees from Abengoa to Abengoa Yield and our subsidiaries. Additionally, we have
reviewed and supervised implementation of a number of key policies. As of today, our
policies are Abengoa’s policies and over the next year we expect to finalize their
implementation, adapting them as required.

Annual Report on Remuneration

Single total figure of remuneration for each director

The information provided in this part of the report is subject to audit.

The only executive director received no remuneration from Abengoa Yield Plc in 2014 for his
services to Abengoa Yield Plc. He was employed by Abengoa SA and his services were
charged to Abengoa Yield Plc as part of the Executive Services Agreement in place between
Abengoa SA and Abengoa Yield Plc.

ABENGOA YIELD PLC
Directors’ Remuneration Report

Annual Report on Remuneration (continued)

Name

Santiago Seage*
Manuel Sanchez**
Daniel Villalba
Jackson Robinson
Enrique Alarcon
Eduardo Kausel
Juan del Hoyo
William Richardson***
Christopher Standlee**
Maria J. Esteruelas**

Total

Director’s remuneration as a single figure (2014)

Salary and
fees
€’000

All
taxable
benefits
€’000

Annual
bonuses
€’000

LTIP
€’000

Pension
€’000

Total for
2014
€’000

130.8
-
50.9
37.7
37.7
37.7
37.7
33.5
-
-

366.0

0.1

130.9
-
50.9
37.7
37.7
37.7
37.7
33.5
-
-

366.1

No remuneration was received by the directors for services to the Company for the year ended 31 December
2013.

The chief executive officer was employed by Abengoa SA and therefore received no remuneration
directly from the Company. The table above reflects an estimate of the fixed remuneration he has
received from Abengoa SA for services provided to the Company, based on the time dedicated to the
Company. The chief executive officer has not received any variable remuneration for services provided
to Abengoa Yield for the year ended 31 December 2014.

Abengoa related directors did not receive any fees for acting as directors of the Company.

*** Mr. Richardson did not receive any fees from the Company for acting as director of the Company. The
table above reflects an estimate of the fee he received from Abengoa SA for his time dedicated to the
Company.

Remuneration of the Chief Executive Officer

The information provided in this part of the report is not subject to audit.

The table below sets out the details for the director undertaking the role of chief executive
officer (CEO)*.

Year

2014
2013

CEO Single figure of total
remuneration
(€’000)

Annual bonus pay-out
against maximum
%

Long term incentive vesting
rates against maximum
opportunity
%

130.9
-

-
-

No remuneration was received for services to the Company for the year ended 31 December 2013.

The chief executive officer was employed by Abengoa SA and therefore received no remuneration
directly from the Company. The table above reflects an estimate of the fixed remuneration he has
received from Abengoa SA for services provided to the Company, based on the time dedi cated to the
Company. The chief executive officer has not received any variable remuneration for services provided
to Abengoa Yield for the year ended 31 December 2014.

ABENGOA YIELD PLC
Directors’ Remuneration Report

Annual Report on Remuneration (continued)

Directors Shareholdings

The following table includes the number of shares held by directors and their connected
persons. Those not included in the table do not hold shares:

Santiago Seage

Daniel Villalba

Manuel Sanchez

2015 Remuneration Policy

31st December 2014

31st December 2013

20,000

46,897

28,000

If approved, this policy will take effect from the date of our Annual General Meeting,
currently expected to be held in May 2015

For independent directors the Company’s policy is to compensate in cash for the time
dedicated, that is currently estimated at a maximum 135 thousand for the lead independent
director and 100 thousand dollars for directors, assuming 9-10 meetings per year.

The Company expects that the CEO will spend around 60% of his time on Abengoa Yield
and that the Company will therefore bear that cost based on that dedication. In 2015 the
CEO will not receive variable payments from the Company as in 2014 he was employed by
Abengoa SA and his objectives were based on Abengoa and not on the Company. It is
intended during the year that the Company will introduce a performance related variable
pay arrangement under which cash will be paid to executives including the chief executive
officer. The performance measures will be linked to dividends and investments and the
targets will be set out in the remuneration report next year. Payment will be made subject
to performance and continued employment..

For the management team and key personnel our policy is to use two external consultants
to estimate market conditions for similar positions in terms of fixed and variable
remuneration and, based on a performance appraisal, set a target remuneration normally
within that market practice. Variable payments are based on a number of specific
measurable targets defined at the beginning of the year. Additionally, and in some cases,
we might approve multiyear plans. For the rest of its employees the Company establishes
predefined remuneration ranges for different positions and reviews each individual
remuneration depending on performance appraisal and the position within two ranges
without employee consultation.

Overall we expect that, following the implementation of these policies, remunerations of the
Company’s employees will increase in line with the market with the exception of individuals
that have been recently promoted or whose remuneration is below market conditions. In
the case of our directors, the base pay increase will be within 5% of the increase in our
comparable peer group.

In any case, the remuneration committee will review in April-May the policies and specific
levels.

ABENGOA YIELD PLC
Directors’ Remuneration Report

2015 Remuneration Policy (continued)

None of the non-executive directors receives bonuses, long-term incentives, pension or
other benefits in respect of their services to the Company.

There are no provisions for the recovery of sum paid or the withholding of any sum.

Given that in 2014 the Company had no employees, the remuneration paid to employees is
not significant.

Service Contracts

Mr. Seage had no contract with Abengoa Yield as of 31st December 2014 as he was an
employee of Abengoa SA. His services are governed by the Executive Services Agreement
between Abengoa SA and Abengoa Yield Plc. Accordingly, the Company has no policy on
notice periods.

The non-executive directors do not have a service contract and have been elected for a
period of three years starting June 2014.

Payments for loss of office for executive directors or executives would be based on
prevailing labour and legal conditions in their contracts or countries where they are
employed. The Company may lawfully terminate the executive director’s employment
without compensation in circumstances where the employer is entitled to terminate for
cause as defined by applicable law. In the event of termination by the Company, each
executive director may have an entitlement to compensation in respect of his statutory
rights under employment protection legislation in the UK, Spain or elsewhere.

Statement of voting at general meeting

The remuneration report will be submitted to the annual shareholder meeti ng in 2015 for
the first time.

Approval
This report was approved by the board of directors on 23rd February, 2015 and signed on its
behalf by Santiago Seage, CEO.

ABENGOA YIELD PLC
Directors’ Responsibilities Statement

Directors’ Responsibilities Statement

The directors are responsible for preparing the Annual Report and the financial statements
in accordance with applicable law and regulations.

Company law requires the directors to prepare such financial statements for each financial
year. Under that law the directors are required to prepare the financial statements in
accordance with International Financial Reporting Standards (IFRSs) as adopted by the
International Accounting Standards Board (IASB) and Article 4 of the IAS Regulation. Under
company law the directors must not approve the financial statements unless they are
satisfied that they give a true and fair view of the state of affairs of the Company and of the
profit or loss of the Company for that period. In preparing these financial statements,
International Accounting Standard 1 requires that directors:

 properly select and apply accounting policies;

 present information, including accounting policies, in a manner that provides relevant,

reliable, comparable and understandable information;

 provide additional disclosures when compliance with the specific requirements in IFRSs
are insufficient to enable users to understand the impact of particular transactions, other
events and conditions on the entity’s financial position and financial performance; and

 make an assessment of the Company’s ability to continue as a going concern.

The directors are responsible for keeping adequate accounting records that are sufficient to
show and explain the Company’s transactions and disclose with reasonable accuracy at any
time the financial position of the Company and enable them to ensure that the financial
statements comply with the Companies Act 2006. They are also responsible for
safeguarding the assets of the Company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.

The directors are responsible for the maintenance and integrity of the corporate and
financial information included on the Company’s website. Legislation in the United Kingdom
governing the preparation and dissemination of financial statements may differ from
legislation in other jurisdictions.

ABENGOA YIELD PLC
Directors’ Responsibilities Statement

Directors' Responsibility Statement

We confirm that to the best of our knowledge:

1. the financial statements, prepared in accordance with International Financial Reporting
Standards as adopted by the IASB, give a true and fair view of the assets, liabilities,
financial position and profit or loss of the Company and the undertakings included in the
consolidated group taken as a whole;

2. the strategic report includes a fair review of the development and performance of the
business and the position of the Company and the undertakings included in the
consolidation taken as a whole, together with a description of the principal risks and
uncertainties that they face; and

3. the annual report and financial statements, taken as a whole, are fair, balanced and
understandable and provide the information necessary for shareholders to assess the
Company’s performance, business model and strategy.

ABENGOA YIELD PLC
Independent auditor’s report to the members of Abengoa Yield plc

Independent auditor’s report to the members of Abengoa Yield plc

We have audited the financial statements of Abengoa Yield plc for the year ended 31
December 2014 which comprise the Income Statement, the Balance Sheet, the Cash Flow
Statement, the Statement of Changes in Equity and the related notes 1 to 26. The financial
reporting framework that has been applied in their preparation is applicable law and
International Financial Reporting Standards (IFRSs) as adopted by the European Union.

This report is made solely to the Company’s members, as a body, in accordance with
Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so
that we might state to the Company’s members those matters we are required to state to
them in an auditor’s report and for no other purpose. To the fullest extent permitted by law,
we do not accept or assume responsibility to anyone other than the Company and the
Company’s members as a body, for our audit work, for this report, or for the opinions we
have formed.

Respective responsibilities of directors and auditor

As explained more fully in the Directors’ Responsibilities Statement, the directors are
responsible for the preparation of the financial statements and for being satisfied that they
give a true and fair view. Our responsibility is to audit and express an opinion on the
financial statements in accordance with applicable law and International Standards on
Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices
Board’s Ethical Standards for Auditors.

Scope of the audit of the financial statements

An audit involves obtaining evidence about the amounts and disclosures in the financial
statements sufficient to give reasonable assurance that the financial statements are free
from material misstatement, whether caused by fraud or error. This includes an assessment
of: whether the accounting policies are appropriate to the Company’s circumstances and
have been consistently applied and adequately disclosed; the reasonableness of significant
accounting estimates made by the directors; and the overall presentation of the financial
statements. In addition, we read all the financial and non-financial information in the annual
report to identify material inconsistencies with the audited financial statements and to
identify any information that is apparently materially incorrect based on, or materially
inconsistent with, the knowledge acquired by us in the course of performing the audit. If we
become aware of any apparent material misstatements or inconsistencies we consider the
implications for our report.

Opinion on financial statements

In our opinion the financial statements:

 give a true and fair view of the state of the Company’s affairs as at 31 December 2014

and of its profit for the year then ended;

 have been properly prepared in accordance with IFRSs as adopted by the European

Union; and

 have been prepared in accordance with the requirements of the Companies Act 2006.

Separate opinion in relation to IFRSs as issued by the IASB

ABENGOA YIELD PLC
Independent auditor’s report to the members of Abengoa Yield plc

Opinion on financial statements (continued)

As explained in note 1 to the financial statements, the Company in addition to applying
IFRSs as adopted by the European Union, has also applied IFRSs as issued by the
International Accounting Standards Board (IASB).

In our opinion the financial statements comply with IFRSs as issued by the IASB.

Opinion on other matters prescribed by the Companies Act 2006

In our opinion:



the part of the Directors’ Remuneration Report to be audited has been properly prepared
in accordance with the Companies Act 2006; and

the information given in the Strategic Report and the Directors’ Report for the financial
year for which the financial statements are prepared is consistent with the financial
statements.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where the Companies Act
2006 requires us to report to you if, in our opinion:

 adequate accounting records have not been kept, or returns adequate for our audit have

not been received from branches not visited by us; or



the financial statements and the part of the Directors’ Remuneration Report to be
audited are not in agreement with the accounting records and returns; or

 certain disclosures of directors’ remuneration specified by law are not made; or

 we have not received all the information and explanations we require for our audit.

ABENGOA YIELD PLC
Income Statement
Year ended 31 December 2014

Income Statement

Operating revenue
Other operating expenses

Operating profit

Finance cost
Other gains and losses

Profit before tax

Tax

Profit for the period

Year
Ended
2014
US$’000

24,006
(3,668)

20,338

(2,319)
(9,814)

8,205

209

8,414

15 day
period
Ended
2013
US$’000

-
-

Notes (1)

9
10

All results are derived from continuing operations.
The company has no other gains and losses other than those disclosed above.

(1)

Notes 1 to 26 are an integral part of these financial statements.

ABENGOA YIELD PLC
Balance Sheet
31 December 2014

Balance Sheet

Non-current assets

Investments in subsidiaries
Amounts owed by group undertakings
Deferred tax asset

Current assets
Trade and other receivables
Amounts owed by group undertakings
Cash and bank balances

Total assets

Current liabilities
Trade and other payables
Amounts owed to group undertakings
Borrowings

Net current assets

Non-current liabilities
Borrowings
Deferred revenue

Total liabilities

Net assets

Equity
Share capital
Share premium account
Distributable reserves
Retained earnings

Total equity

Notes (1)

2014
US$’000

2013
US$’000

13
14
11

14
19

15
16

17
17
17
18

1,392,481
694,302
209

2,086,992

1,250
25,485
155,367

182,102

2,269,094

19,558
172
2,255

21,985

160,117

376,159
64,400

440,559

462,544

1,806,550

8,000
1,313,903
476,233
8,414

1,806,550

-
-
-

-
-

-
-
-
-

The Company made a number of acquisitions during the year 2014 (see note 13).

(1)

Notes 1 to 26 are an integral part of these financial statements.

ABENGOA YIELD PLC
Balance Sheet
31 December 2014

The financial statements of Abengoa Yield plc, company registration no. 08818211, were
approved by the board of directors and authorised for issue on 23rd February 2015. They
were signed on its behalf by:

CEO

Santiago Seage

ABENGOA YIELD PLC
Statement of changes in equity
Year ended 31 December 2014

Statement of changes in equity

Share
Capital
US$’000

Share
Premium
Account
US$’000

Distributab
le Reserves
US$’000

Retained
Earnings
US$’000

Total
Equity
US$’000

Notes (1)

Balance at December 31 2013

Profit for the period
Issue of share capital and share

premium

IPO transaction costs
Reduction of share premium
Dividends

17
17

8,414

8,000
-
-
-

1,813,903

(500,000)

-
(71)
500,000
(23,696)

-
-
-
-

1,821,903
(71)
-
(23,696)

Balance at December 31 2014

8,000

1,313,903

476,233

8,414

1,806,550

(1)

Notes 1 to 26 are an integral part of these financial statements

ABENGOA YIELD PLC
Cash flow statement
31 December 2014

Cash flow statement

Net cash from operating activities

Investing activities

Acquisition of subsidiary
Purchases of other financial assets

Net cash used in investing activities

Financing activities

Dividends paid
Proceeds on issue of shares
New bank loans raised
New Bonds raised
Arrangement fees for loans
Repayment of debt

Net cash from financing activities

Net increase in cash and cash equivalents

Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

Notes (1)

15
15
15

(1)

Notes 1 to 26 are an integral part of these financial statements.

Year
ended
2014
US$’000

6,900

(196,849)
(34,053)

(230,902)

(23,696)
681,915
125,000
255,000
(3,253)
(655,597)

379,369

155,367

15 day
period
ended
2013
US$’000

-
-

-
-
-
-

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

Notes to the financial statements

1. General information

Abengoa Yield plc is a company incorporated in the United Kingdom under the
Companies Act. The address of the registered office is Great West Road, Brentford
TW8 9DF, Greater London (United Kingdom). The nature of the Company’s operations
and its principal activities are set out in the strategic report on pages 3 to 11.

These financial statements are presented in US Dollars because that is the primary
currency in which the Company operates.

2. Adoption of new and revised Standards

Standards, interpretations and amendments effective from 1st January 2014
under IFRS-EU, applied by the Company:

›

IAS 32 (Amendment) ’Offsetting of financial assets and financial liabilities’.
The IAS 32 amendment is mandatory for periods beginning on or after 1st
January 2014 under IFRS-EU and under the IFRS approved by the International
Accounting Standards Board, hereinafter IFRS-IASB, and is to be applied
retroactively.

IAS 36 (Amendment) ‘Recoverable Amount Disclosures for Non-Financial
Assets’. The IAS 36 amendment is mandatory for periods beginning on or
after 1st January 2014 under IFRS-EU and IFRS-IASB.

IAS 39 (Amendment) ‘Novation of Derivatives and Continuation of Hedge
Accounting’. The IAS 39 amendment is for periods beginning on or after 1st
January 2014 under IFRS-EU and IFRS-IASB.

The applications of these amendments have not had any material impact on these
financial statements

In preparing these Consolidated Financial Statements as of 31st December 2014,
the Group has applied the following new standards and amendments that came
into effect on 1st January 2014 under IFRS-IASB, and which have been applied
early under IFRS-EU:

›

IFRIC 21 (Interpretation) ‘Levies’. The IFRIC 21 is mandatory for periods
beginning on or after 1st January 2014 under IFRS-IASB and for periods
beginning on or after 17th June 2014 under IFRS – EU.

The amendments and interpretations effective from 1st January 2014 have not had any
significant impact on these financial statements.

Standards, interpretations and amendments published by the IASB that will be
effective for periods beginning on or after 1st January, 2015:

› Annual Improvements to IFRSs 2010-2012 and 2011-2013 cycles. These
improvements are mandatory for periods beginning on or after 1st July 2014
under IFRS-IASB and have not yet been adopted by the EU.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

Notes to the financial statements

2. Adoption of new and revised Standards (continued)

› Annual Improvements to IFRSs 2012-2014 cycle. These improvements are
mandatory for periods beginning on or after 1st January 2016 under IFRS-IASB
and have not yet been adopted by the EU.

›

IFRS 9 ’Financial Instruments’. This Standard will be effective from 1st January
2018 under IFRS-IASB and has not yet been adopted by the EU.

IFRS 14 ‘Regulatory Deferral Accounts’. This Standard will be effective from 1st
January 2016 under IFRS-IASB ad has not yet been adopted by the EU.

IFRS 15 ’Revenues from contracts with Customers’. IFRS 15 is applicable for
periods beginning on or after 1st January 2017. Earlier application is permitted.
IFRS 15 has not yet been adopted by the EU.

IAS 16 (Amendment) ’Property, Plant and Equipment’ and IAS 38 ’Intangible
Assets’, regarding acceptable methods of amortization and depreciation. This
amendment is mandatory for periods beginning on or after 1st January 2016
under IFRS-IASB, earlier application is permitted, and has not yet been
adopted by the EU.

‘Separate

(Amendment)

IAS 27
the
reinstatement of the equity method as an accounting option n separate
financial statements. This amendment is mandatory for periods beginning on
or after 1st January 2016 under IFRS-IASB and has not yet been adopted by the
EU.

financial statements’

regarding

IFRS 10 (Amendment) ‘Consolidated financial statements’ and IAS 28
‘Investments in associates and joint ventures’ regarding the exemption from
consolidation for investment entities. These amendments are mandatory for
periods beginning on or after 1st January 2016 under IFRS-IASB and have not
yet been adopted by the EU.

IFRS 11 (Amendment) ’Joint Arrangements’ regarding acquisition of an
interest in a joint operation. This amendment is mandatory for periods
beginning on or after 1st January 2016 under IFRS-IASB, earlier application is
permitted, and has not yet been adopted by the EU.

The Company is currently in the process of evaluating the impact on the financial
statements derived from the application of the new standards and amendments
that will be effective for periods beginning after 31st December 2014.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

Significant accounting policies

Basis of accounting

The financial statements have been prepared in accordance with International Financial
Reporting Standards (IFRSs) as issued by the International Accounting Standards Board
(IASB).

The company is exempt from the preparation of consolidated financial statements,
since it is included in the group accounts of Abengoa S.A. The group accounts of
Abengoa S.A. are available for public use and can be obtained as set out in note 26. In
addition, the Company is preparing consolidated accounts in accordance with IFRSs as
issued by the IASB, which are also filed within the Securities and Exchange
Commission (SEC).

The financial statements have been prepared on the historical cost basis. Historical cost
is generally based on the fair value of the consideration given in exchange for goods
and services. The principal accounting policies adopted are set out below.

Going concern

The directors have, at the time of approving the financial statements, a reasonable
expectation that the Company have adequate resources to continue in operational
existence for the foreseeable future. Thus they continue to adopt the going concern
basis of accounting in preparing the financial statements. Further detail is contained in
the Strategic Report on pages 3 to 11.

Revenue recognition

Dividend income from investments is recognised when the shareholders’ rights to
receive payment have been established (provided that it is probable that the economic
benefits will flow to the Group and the amount of revenue can be measured reliably).

Interest income is recognised when it is probable that the economic benefits will flow
to the Group and the amount of revenue can be measured reliably. Interest income is
accrued on a time basis, by reference to the principal outstanding and at the effective
interest rate applicable, which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset to that asset’s net carrying
amount on initial recognition.

Foreign currencies

In preparing the financial statements of the individual companies, transactions in
currencies other than the entity’s functional currency (which is US$) are recognised at
the rates of exchange prevailing on the dates of the transactions. At each balance
sheet date, monetary assets and liabilities that are denominated in foreign currencies
are retranslated at the rates prevailing at that date. Non-monetary items carried at fair
value that are denominated in foreign currencies are translated at the rates prevailing
at the date when the fair value was determined. Non-monetary items that are
measured in terms of historical cost in a foreign currency are not retranslated.
Exchange differences are recognised in profit or loss in the period in which they arise.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

Significant accounting policies (continued)

Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs
from net profit as reported in the income statement because it excludes items of
income or expense that are taxable or deductible in other years and it further excludes
items that are never taxable or deductible. The group’s liability for current tax is
calculated using tax rates that have been enacted or substantively enacted by the
balance sheet date.

Deferred tax

Deferred tax is the tax expected to be payable or recoverable on differences between
the carrying amounts of assets and liabilities in the financial statements and the
corresponding tax bases used in the computation of taxable profit, and is accounted
for using the balance sheet liability method. Deferred tax liabilities are generally
recognised for all taxable temporary differences and deferred tax assets are recognised
to the extent that it is probable that taxable profits will be available against which
deductible temporary differences can be utilised. Such assets and liabilities are not
recognised if the temporary difference arises from the initial recognition of assets and
liabilities in a transaction that affects neither the taxable profit nor the accounting
profit.

Deferred tax liabilities are recognised for taxable temporary differences arising on
investments in subsidiaries, except where the Company is able to control the reversal
of the temporary difference and it is probable that the temporary difference will not
reverse in the foreseeable future. Deferred tax assets arising from deductible
temporary differences associated with such investments and interests are only
recognised to the extent that it is probable that there will be sufficient taxable profits
against which to utilise the benefits of the temporary differences and they are
expected to reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and
reduced to the extent that it is no longer probable that sufficient taxable profits will be
available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period
when the liability is settled or the asset is realised based on tax laws and rates that
have been enacted or substantively enacted at the balance sheet date. Deferred tax is
charged or credited in the income statement, except when it relates to items charged
or credited in other comprehensive income, in which case the deferred tax is also dealt
with in other comprehensive income.

The measurement of deferred tax liabilities and assets reflects the tax consequences
that would follow from the manner in which the Company expects, at the end of the
reporting period, to recover or settle the carrying amount of its assets and liabilities.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

Significant accounting policies (continued)

Investments in subsidiaries and impairment

Investments in subsidiaries are stated at cost less, where appropriate, provisions for
impairment.

At each balance sheet date, the Company reviews the carrying amounts of its
investments to determine whether there is any indication that those assets have
suffered an impairment loss. If any such indication exists, the recoverable amount of
the asset is estimated to determine the extent of the impairment loss (if any).

Recoverable amount is the higher of fair value less costs to sell and value in use. In
assessing value in use, the estimated future cash flows are discounted to their present
value using a pre-tax discount rate that reflects current market assessments of the time
value of money and the risks specific to the asset for which the estimates of future
cash flows have not been adjusted.

If the recoverable amount of an asset is estimated to be less than its carrying amount,
the carrying amount of the asset is reduced to its recoverable amount. An impairment
loss is recognised immediately in profit or loss.

Where an impairment loss subsequently reverses, the carrying amount of the asset is
increased to the revised estimate of its recoverable amount, but so that the increased
carrying amount does not exceed the carrying amount that would have been
determined had no impairment loss been recognised for the asset in prior years. A
reversal of an impairment loss is recognised immediately in profit or loss.

Financial instruments

Financial assets and financial liabilities are recognised in the Company’s balance sheet
when the Company becomes a party to the contractual provisions of the instrument.

Financial assets and financial liabilities are initially measured at fair value. Transaction
costs that are directly attributable to the acquisition or issue of financial assets and
financial liabilities (other than financial assets and financial liabilities at fair value
through profit or loss) are added to or deducted from the fair value of the financial
assets or financial liabilities, as appropriate, on initial recognition. Transaction costs
directly attributable to the acquisition of financial assets or financial liabilities at fair
value through profit or loss are recognised immediately in profit or loss.

Financial Assets

All financial assets are recognised and derecognised on a trade date where the
purchase or sale of a financial asset is under a contract whose terms require delivery of
the financial asset within the timeframe established by the market concerned, and are
initially measured at fair value, plus transaction costs, except for those financial assets
classified as at fair value through profit or loss, which are initially measured at fair
value.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

Significant accounting policies (continued)

Financial assets are classified into the following specified categories: financial assets ‘at
fair value through profit or loss’ (FVTPL), ‘held-to-maturity’ investments, ‘available-for-
sale’ (AFS) financial assets and ‘loans and receivables’. The classification depends on
the nature and purpose of the financial assets and is determined at the time of initial
recognition. As at the balance sheet date the Company held only AFS financial assets
and loans and receivables and therefore we have discussed only the treatment applied
to those assets within this policy.

Effective interest method

The effective interest method is a method of calculating the amortised cost of a debt
instrument and of allocating interest income over the relevant period. The effective
interest rate is the rate that exactly discounts estimated future cash receipts (including
all fees and points paid or received that form an integral part of the effective interest
rate, transaction costs and other premiums or discounts) through the expected life of
the debt instrument, or, where appropriate, a shorter period, to the net carrying
amount on initial recognition. Income is recognised on an effective interest basis for
debt instruments.

Available for sale financial assets

AFS financial assets are non-derivatives that are either designated as AFS or are not
classified as (a) loans and receivables, (b) held-to-maturity investments or (c) financial
assets at fair value through profit or loss.

The Company has investments in unlisted shares that are not traded in an active
market but that are classified as AFS financial assets and stated at fair value (because
the directors consider that fair value can be reliably measured). Fair value is the price
that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date, regardless of
whether that price is directly observable or estimated using another valuation
technique. In estimating the fair value of an asset or a liability, the Company takes into
account the characteristics of the asset or liability if market participants would take
those characteristics into account when pricing the asset or liability at the
measurement date. Fair value for measurement and/or disclosure purposes in these
financial statements is determined on such a basis. Dividends on AFS equity
instruments are recognised in profit or loss when the Company’s right to receive the
dividends is established.

Loans and receivables

Trade receivables, loans, and other receivables that have fixed or determinable
payments that are not quoted in an active market are classified as ‘loans and
receivables’. Loans and receivables are measured at amortised cost using the effective
interest method, less any impairment. Interest income is recognised by applying the
effective interest rate, except for short-term receivables when the recognition of
interest would be immaterial.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

Significant accounting policies (continued)

Impairment of financial assets

Financial assets, are assessed for indicators of impairment at each balance sheet date.
Financial assets are impaired where there is objective evidence that, as a result of one
or more events that occurred after the initial recognition of the financial asset, the
estimated future cash flows of the investment have been affected.

For unlisted equity investments classified as AFS, a significant or prolonged decline in
the fair value of the security below its cost is considered to be objective evidence of
impairment.

For financial assets carried at amortised cost, the amount of the impairment is the
differences between the asset’s carrying amount and the present value of estimated
future cash flows, discounted at the financial asset’s original effective interest rate.

When an AFS financial asset is considered to be impaired, cumulative gains or losses
previously recognised in other comprehensive income are reclassified to profit or loss
in the period.

With the exception of AFS equity instruments, if, in a subsequent period, the amount
of the impairment loss decreases and the decrease can be related objectively to an
event occurring after the impairment was recognised, the previously recognised
impairment loss is reversed through profit or loss to the extent that the carrying
amount of the investment at the date the impairment is reversed does not exceed
what the amortised cost would have been had the impairment not been recognised. In
respect of AFS equity securities, impairment losses previously recognised in profit or
loss are not reversed through profit or loss. Any increase in fair value subsequent to an
impairment loss is recognised in other comprehensive income and accumulated under
the heading of investments revaluation reserve.

Financial liabilities and equity

Debt and equity instruments are classified as either financial liabilities or as equity in
accordance with the substance of the contractual arrangement.

Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of
an entity after deducting all of its liabilities. Equity instruments issued by the Company
are recognised at the proceeds received.

Financial liabilities

Financial liabilities are classified as either financial liabilities ‘at FVTPL’ or ‘other
financial liabilities’.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

Significant accounting policies (continued)

Other financial liabilities

Other financial liabilities, including borrowings, are initially measured at fair value, net
of transaction costs. Other financial liabilities are subsequently measured at amortised
cost using the effective interest method, with interest expense recognised on an
effective yield basis.

The effective interest method is a method of calculating the amortised cost of a
financial liability and of allocating interest expense over the relevant period. The
effective interest rate is the rate that exactly discounts estimated future cash payments
through the expected life of the financial liability, or, where appropriate, a shorter
period, to the net carrying amount on initial recognition.

Transaction fees on borrowings are capitalised and amortised over the term of the
borrowings.

Critical accounting judgements and key sources of estimation uncertainty

In the application of the Company’s accounting policies, which are described in note
3, the directors are required to make judgements, estimates and assumptions about
the carrying amounts of assets and liabilities that are not readily apparent from other
sources. The estimates and associated assumptions are based on historical experience
and other factors that are considered to be relevant. Actual results may differ from
these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions
to accounting estimates are recognised in the period in which the estimate is revised if
the revision affects only that period, or in the period of the revision and future periods
if the revision affects both current and future periods.

The following are the critical judgements and estimates the directors have made in the
process of applying the Company’s accounting policies and that have the most
significant effect on the amounts recognised in financial statements.

Impairment of investments in subsidiaries

Determining whether the company’s investments in subsidiaries have been impaired
requires estimations of the investments’ values in use. The value in use calculations
require the entity to estimate the future cash flows expected to arise from the
investments and suitable discount rates in order to calculate present values. The
carrying amount of investments in subsidiaries at the balance sheet date was $
1,392,481 thousand with no impairment loss recognised in 2014 or 2013.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

Critical accounting judgements and key sources of estimation uncertainty

4.
(continued)

Fair value measurement of available for sale financial assets

The Company’s available for sale financial assets are measured at fair value for
financial reporting purposes.
The fair value of the preferred equity investment in ACBH was calculated by taking as
the main reference the value of the investment, which is obtained by considering
expected cash-flows from the preferred equity instrument discounted at a rate
appropriate for the sector in which the Company is operating. Valuation was obtained
from internal models. This valuation could vary where other models and assumptions
made on the principle variables had been used, however the fair value of the asset as
well as the results generated by this financial instrument are considered reasonable.

Profit for the year

Profit for the year has been arrived at after charging:

Net foreign exchange losses

6. Auditor’s remuneration

The analysis of the auditor’s remuneration is as follows:

Fees payable to the company’s auditor for the audit of the company’s
annual accounts

Fees payable to the company’s auditor for the audit of the group
accounts

Fees payable to the company’s auditor for other audit services

Total audit fees

Year
ended
2014
US$’000

9,821

Period
ended
2013
US$’000

Year
ended
2014
US$’000

Period
ended
2013
US$’000

144

508

318

970

No services were provided pursuant to contingent fee arrangements. Audit fees for the
period ended 2013 were borne by Abengoa S.A.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

Staff costs

The company had no employees in the period (2013 - Nil).

8. Operating revenue

Interest income
Dividend income (see note 14)

Total Operating Income

Finance costs

Interest on loans (see note 15)
Interest on bonds (see note 15)

Total finance costs

Year
ended
2014
US$’000

Period
ended
2013
US$’000

14,806
9,200

24,006

-
-

Year
ended
2014
US$’000

Period
ended
2013
US$’000

(167)
(2,152)

(2,319)

-
-

Interest on bonds and loans relate to the interest on the $ 255 million Senior Notes
issued in November 2014 and on the $ 125 million credit facility entered into in
December 2014 respectively. See Note 15 for further details of the terms in place.

10. Other gains and losses

Net foreign exchange losses
Other gains

Total other gains and losses

Year
ended
2014
US$’000

Period
ended
2013
US$’000

(9,821)
7

(9,814)

-
-

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

11. Tax

Corporation tax:
Current tax

Year
ended
2014
US$’000

Period
ended
2013
US$’000

209

The charge for the year can be reconciled to the profit in the income statement as
follows:

Profit before tax on continuing operations

Profit before tax multiplied by the blended rate of
Corporation tax in the UK of 21.5% (2013 –
23.25%)

Tax effect of income not taxable in determining
taxable profit

Tax credit for the period

Year
ended
2014
US$’000

8,205

1,723

(1,932)

(209)

Period
ended
2013
US$’000

The tax effect of income not taxable in determining taxable profit relates to dividend
income.

On 17th July 2013, the Finance Act 2013 received Royal Assent which enacted the
change in the corporate tax rate in the UK from 23% to 21% from 1 April 2014 and
to 20% from 1 April 2015.

12. Dividends

On 14th November 2014, the Company announced that the board of directors
declared the first quarterly dividend corresponding to the third quarter of 2014,
amounting to $0.2592 per share. The dividend was paid on December 15 2014,
together with a pro-rata dividend corresponding to the number of days since the initial
public offering to June 30 2014, amounting to $0.0370 per share, which resulted in a
total average payment of $ 0.2962 per share, resulting in a total payment of US$23.7
million.

The payment of this dividend will not have any tax consequences for the Company.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

13.

Investments in subsidiaries

Details of the Company’s subsidiaries at 31 December 2014 are as follows:

Name

Place of
incorporation
and principal
place of
business

Proportion
of
ownership
interest
%

Proportion
of
voting
power held
%

Palmucho, S.A.
Solar de Receptores de Andalucía, S.A.
Transmisora Baquedano, S.A.
Transmisora Mejillones, S.A.
Abengoa Solar US Holdings Inc.
ACT Holdings, S.A. de C.V.
Abengoa Concessions Perú, S.A.
Abengoa Concessions Infrastructure, S.L.
Abengoa Solar Holdings USA Inc

Chile
Spain
Chile
Chile
USA
Mexico
Peru
Spain
USA

1%
99.99%
0.10%
0.10%
100%
99.97%
99.99%
99.99%
100%

100%
99.99%
100%
100%
100%
99.97%
99.99%
99.99%
100%

As at 31 December 2013 the Company had no subsidiary undertakings.

The investments in subsidiaries are all stated at cost. As of 31 December 2014, the
carrying value of these investments was as follows:

2014
US$’000

2013
US$’000

-
73
-
-
317,950
72,095
258,795
363,375
380,193

Total Investments in subsidiaries

1,392,481

Movements in the carrying value of investments during the period were as follows:

-
-
-
-
-
-
-
-
-

As at 1st January 2014
Additions

As at 31st December 2014

US$’000

-
1,392,481

1,392,481

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

13.

Investments in subsidiaries (continued)

The date and method of the acquisition of each subsidiary during the period were as
follows:

Acquisition date Acquisition method

(*) Contribution through issue of shares

13/06/2014
23/12/2014 Purchase
14/04/2014 Purchase
14/04/2014 Purchase
13/06/2014
13/06/2014
13/06/2014
13/06/2014
13/06/2014

(*) Contribution through issue of shares
(*) Contribution through issue of shares
(*) Contribution through issue of shares
(*) Contribution through issue of shares
(*) Contribution through issue of shares

(*) Prior to the initial public offering of Abengoa Yield Plc., Abengoa contributed, through a series of
transactions, which we refer to collectively as the “Asset Transfer,” a series of concessional assets
described in the Strategic Report on pages 3 to 11, certain holding companies and the preferred
equity investment in ACBH.
In September 2014, pursuant to the ROFO Agreement, the Company agreed to acquire from
Abengoa an additional set of assets described in the Strategic Report on pages 3 to 11 through a
purchase by Abengoa Yield’s immediate holding company. The acquisition of these assets completed
during December 2014, with the total consideration being paid for these assets amounting to $312
million.

14. Amounts owed by group undertakings

Non-current receivables from group companies
Preferred equity investment in ACBH

Current receivables from group companies

2014
US$’000

2013
US$’000

431,302
263,000

694,302

25,485

719,787

-
-

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

14. Amounts owed by group undertakings (continued)

The preferred equity investment in ACBH is an available for sale financial asset that
gives the following rights:

 During the five-year period commencing on 1st July 2014, Abengoa Yield has the
right to receive, in four quarterly instalments, a preferred dividend of $18,400
thousand per year;

 Following the initial five-year period, Abengoa Yield has the option to (i) remain as
preferred equity holder receiving the first $18,400 thousand in dividends per year
that ACBH is able to distribute or (ii) exchange the preferred equity for ordinary
shares of specific project companies owned by ACBH.

Given that Abengoa Yield has a right to receive a quarterly dividend during the
upcoming five years, the Company has recorded an account receivable for a total
amount of $70,784 thousand as at 31 December, 2014, corresponding to the present
value of the receivable, with a credit to Deferred income. Income is recorded
progressively during the next five years from July 2014, as dividend is collected. The
long-term portion of this account receivable is included in non-current receivables
from group companies as set out below.

The current receivables from group companies includes the current portion of the
preferred dividend of $18,400 thousand and accrued interest on loans from group
companies.

As at 31 December 2014, the detail of the amounts owed by group undertakings was
as follows:

Abengoa Transmisión Norte, S.A.
Abengoa Concessions Infrastructure, S.L.
Abengoa Concessões Brasil Holding, S.A.
Carpio Solar Inversiones, S.A.
Abengoa Transmisión Sur, S.A.
Logrosán Solar Inversiones, S.A.
ACT Holdings, S.A. de C.V.
Other

Amounts owed by group undertakings

2014
US$’000

2013
US$’000

21,932
43,035
64,400
116,472
84,764
42,807
51,448
6,444

431,302

-
-
-
-
-
-
-
-

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

14. Amounts owed by group undertakings (continued)

The principal features of the main group’s borrowings are as follows:

Interest Rate

Maturity

Abengoa Transmisión Norte, S.A..
Abengoa Concessions Infrastructure, S.L.
Carpio Solar Inversiones, S.A.
Abengoa Transmisión Sur, S.A.
Logrosán Solar Inversiones, S.A

8.96%
10.05%

2,5% to Euribor 12 months

8.96%

2,5% to Euribor 12 months

Not applicable
Not applicable
31 July 2031
Not applicable
15 December 2030

15. Borrowings

Secured borrowing at amortised cost
Bonds
Borrowings

Total borrowings

Amount due for settlement within 12 months

Amount due for settlement after 12 months

2014
US$’000

2013
US$’000

254,912
123,502

378,414

2,255

376,159

-
-

The principal features of the borrowings and bonds are as follows:

On 17th November 2014 the Company issued 7.000% Senior Notes due 2019 in an
aggregate principal amount of $255 million (the “2019 Notes”). The 2019 Notes
accrue annual interest of 7.000% payable semi-annually beginning on 15th May 2015
until their maturity date of 15th November 2019. In the event that the Company does
not obtain a public credit rating for the 2019 Notes from both S&P and Moody’s prior
to 15th November 2015, the interest rate per annum accruing on the 2019 Notes will
increase by 0.75%, to 7.750%, on and after 15th November 2015 until the date on
which the Company has obtained a public credit rating for the 2019 Notes from both
S&P and Moody’s.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

15. Borrowings (continued)

On 3rd December 2014, the Company entered into a credit facility of up to $125
million with Banco Santander, S.A., Bank of America, N.A., Citigroup Global Markets
Limited, HSBC Bank plc and RBC Capital Markets, as joint lead arrangers and joint
book runners (the “Credit Facility”). On 22nd December 2014, the Company drew
down $125 million under the Credit Facility. Loans under the Credit Facility accrue
interest at a rate per annum equal to: (A) for Eurodollar rate loans, LIBOR plus 2.75%
and (B) for base rate loans, the highest of (i) the rate per annum equal to the weighted
average of the rates on overnight U.S. Federal funds transactions with members of the
U.S. Federal Reserve System arranged by U.S. Federal funds brokers on such day plus
1/2 of 1.00%, (ii) the U.S. prime rate and (iii) LIBOR plus 1.00%, in any case, plus
1.75%. Loans under the Credit Facility will mature on the fourth anniversary of the
closing date of the Credit Facility. Loans prepaid by the Company under the Credit
Facility may be reborrowed. The Credit Facility is secured by pledges of the shares of
the guarantors which the Company owns.

16. Trade and other payables

Deferred income (current)
Other payables (current)

Total current payables excluding borrowings
Deferred income (non – current)

Total non-current payables excluding borrowings

2014
US$’000

2013
US$’000

18,400
1,158

19,558

64,400

-
-

Deferred income current and non-current fully relates to the preferred dividend of
$18,400 thousand per year that the Company has the right to receive for the
upcoming five years commencing on 1 July 2014 from Abengoa Concessões Brasil
Holding, S.A. (see note 14).

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

17. Share capital, share premium and distributable reserves

Share capital
Authorised:
80 million ordinary shares of $ 0.1 each

Issued and fully paid:
80 million ordinary shares of $ 0.1 each

2014
US$’000

2013
US$’000

8,000

The Company has one class of ordinary shares which carry no right to fixed income.

There are a number of events in the current and prior period relating to the issue and
transfer of share capital, being as follows:

 The Company was incorporated by Abengoa on 17th December 2013 under the
name Abengoa Yield Ltd with 100 shares of 0.1 Euros each for a total amount of
10 Euros. These shares were transferred by Abengoa S.A. to Abengoa Concessions
Investments Limited on 27th December 2013.

 On 17th March 2014, Abengoa Yield Plc issued an additional 570,900 shares of 0.1
Euros each for a total amount of 57,090 Euros to Abengoa Concessions
Investments Ltd. On 19th March 2014, the Company re-registered as public limited
company under the name of Abengoa Yield plc. On 20th March 2014, the
571,000 shares in the Company were redenominated to USD, using an exchange
rate of 1.38 USD and immediately consolidated into 5,710 shares of USD 13.80
each. Each share of 13.80 USD was then divided into 138 shares of 0.10 USD each,
resulting in 787,980 shares of 0.1 USD each for a total amount of 78,798 USD
owned by Abengoa Concessions Investments Ltd.

 On 2nd June 2014, Abengoa Solar S.A. transferred its equity interest in Abengoa
Solar US Holdings Inc to Abengoa Yield Plc. in exchange for the allotment and
issue of 12,718,005 shares. Abengoa Solar S.A. then sold its equity interest in
Abengoa Yield Plc on 4th June 2014 to Abengoa Concessions S.L. On 5th June
2014, Abengoa Solar S.A. also contributed 100% of its equity interest in Abengoa
Solar Holdings USA Inc. to Abengoa Yield Plc in exchange for the allotment and
issue of 15,207,720 shares.

 On 13th June 2014, Abengoa Concessions S.L. contributed the shares in Abengoa
Concessions Perú S.A., ACT Holding S.A., Abengoa Concessinos Infrastructures
S.L.U. and Abengoa Concessoes Brasil Holding S.A. to Abengoa Yield plc in
exchange for the allotment and issue of 26,436,295 shares in Abengoa Yield plc.
Subsequently on the same date Abengoa Solar S.A. and Abengoa Concessions S.L.
transferred their equity interest in Abengoa Yield Plc to Abengoa Concessions
Investments Ltd.

 On 18th June 2014, Abengoa Yield plc closed its initial public offering issuing

24,850,000 ordinary shares.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

17. Share capital, share premium and distributable reserves (continued)

The underwriters further purchased 3,727,500 additional shares from Abengoa
Concessions Investment Ltd., a subsidiary wholly owned by Abengoa, at the public
offering price less fees and commissions to cover over-allotments (“greenshoe”)
driving the total proceeds of the offering to $828,748 thousand.

On 22nd January 2015, Abengoa closed an underwritten public offering and sale in the
United States of 10,580,000 of the ordinary shares of Abengoa Yield for total
proceeds of $327,980,000 (or $31 per share). Abengoa continues to beneficially own
a majority of Abengoa Yield´s outstanding shares but, as a result of such offering,
reduced its stake from approximately 64.3% to 51.1% of Abengoa Yield´s shares.

Movements in share capital and share premium in the current and prior periods are as
follows:

Balance at 1 January 2014
Issue of share capital and share premium
Reduction in share premium
Dividend paid

Share
capital
US$’000

Share
premium
US$’000

Distributable
Reserves
US$’000

8,000

-
-

1,813,903
(500,000)

-
(71)
500,000
(23,696)

Balance at 31 December 2014

8,000

1,313,903

476,233

On 14th November 2014, the Board of Directors declared the first quarterly dividend
corresponding to the third quarter of 2014 amounting to $0.2592 per share. The
dividend was paid on 15th December 2014, together with pro-rata dividend
corresponding to the days since our initial public offer on 12th June 2014 until 30th
June 2014, amounting to $0.0370 per share, resulting in a total payment of $0.2962
to shareholders of record as of 28th November 2014.

On 23rd February 2015, the Board of Directors declared a second quarterly dividend
corresponding to the fourth quarter of 2014 amounting to $0.2592 per share. It is
expected that the dividend will be paid on or around 16th March 2015.

On 17th September 2014 the High Court of Justice approved a reduction of the share
premium by US$500 million.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

17. Share capital, share premium and distributable reserves (continued)

The breakdown of share capital and share premium as at 31st December 2014 is as
follows:

Shareholders

Share
capital

Share
premium

Total

Abengoa Concessions Investment
Limited
Free float

5,142

64.28%

1,069,654

1,074,796

2,858

35.72% 744,249 747,107

Total

8,000

100.00%

1,813,903

1,821,903

18. Retained earnings

Balance at 1 January 2014

Net profit for the year

Balance at 31 December 2014

19. Notes to the cash flow statement

Profit for the year

Adjustments for:
Investment revenues
Other gains and losses
Finance costs
Exchange differences

Operating cash flows before movements in working capital
Increase in payables

Cash generated by operations

Net cash from operating activities

2014
US$’000

2013
US$’000

8,414

2014
US$’000

2013
US$’000

8,414

(14,806)
(7)
2,319
9,822

5,742

1,158

6,900

-
-
-
-

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

19. Notes to the cash flow statement (continued)

Cash and bank balances

Analysis of changes in net debt

2014
US$’000

2013
US$’000

155,367

Cash and bank balances
Borrowings
Amount owed by group
undertakings
Amount owed to group
undertakings**

Net debt*

January 1
2014
US$’000

Cash
Flow
US$’000

Interest
Charges
US$’000

Other
non-cash
movements
US$’000

December
31 2014
US$’000

-
-

(155,367)
376,159

(34,053)

(655,597)

(468,858)

-
-

-
2,255

(155,367)
378,414

(667,334)

(701,387)

655,597

(9,482)

(478,340)

* Includes accrued interest at December 31 2014

** Amounts owed to group undertakings included US$655m assigned by Abengoa prior to the IPO. The granting of the loan
during the period represents a non cash movement. Subsequent to the IPO, borrowings assigned were repaid to Abengoa

Balances at December 31 2014 comprise:

Cash and bank balances
Borrowings
Amount owed by group
undertakings

Non-
current
assets
US$’000

Current
assets
US$’000

Current
liabilities
US$’000

Non-
current
liabilities
US$’000

Total
US$’000

-
-

(155,367)
-

-
2,255

-
376,159

(155,367)
378,414

(694,302)

(7,085)

(701,387)

Net debt

(694,302)

(162,452)

2,255

376,159

(478,340)

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

20. Financial Instruments

Capital risk management

The Company manages its capital to ensure that entities in the Company will be able
to continue as a going concern while maximising the return to shareholders through
the optimisation of the debt and equity balance. The capital structure of the Company
consists of net debt (borrowings disclosed in note 19 after deducting cash and bank
balances) and equity of the Company (comprising issued capital, reserves and retained
earnings). The board of directors review the capital structure on a regular basis. As
part of this review, the committee considers the cost of capital and the risks associated
with each class of capital.

Gearing ratio

The gearing ratio at the year end is as follows:

Debt
Cash and cash equivalents

Net financing position

Equity

Net financing position to equity ratio

2014
US$’000

2013
US$’000

378,414
155,367

223,047

1,806,550

12,34%

-
-

Debt is defined as long- and short-term borrowings as detailed in note 15. Equity
includes all capital and reserves of the Company that are managed as capital.

Significant accounting policies

Details of the significant accounting policies and methods adopted (including the
criteria for recognition, the basis of measurement and the bases for recognition of
income and expenses) for each class of financial asset, financial liability and equity
instrument are disclosed in note 3.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

20. Financial Instruments (continued)

Categories of financial instruments

Financial assets
Investments in subsidiaries
Amounts owed by group undertakings
Trade and other receivables
Amounts owed by group undertakings
Cash and bank balances
Available-for-sale financial assets

Financial liabilities
Borrowing

2014
US$’000

2013
US$’000

1,392,481
431,302
1,250
25,485
155,367
263,000

2,268,885

378,414

-
-
-
-
-
-

Financial risk management objectives

Market risk

The Company is exposed to market risk, such as movement in foreign exchange rates
and interest rates. All of these market risks arise in the normal course of business and
we do not carry out speculative operations.

Foreign currency risk management

All financial instruments, except for some borrowings owed by group undertakings to
the Company, are denominated in US$, which is the Company´s functional and
presentation currency.

Interest rate risk management

Financial assets held by the Company are mainly fixed interests instruments, except for
some group´s borrowings owed by group undertakings to the Company. Financial
liabilities are all fixed interests instruments, except for the US$125 million credit facility
entered into in December 2014. For the purpose of managing the interest risk, the
Company is currently closing a hedge instrument on this credit facility which will be
effective in 2015.

Credit risk management

Credit risk refers to the risk that a counterparty will default on its contractual
obligations resulting in financial loss to the Company. The Company does not have
significant credit risk

The Company does not hold significant receivable and therefore does not have any
significant credit risk exposure. The Company does not hold any collateral or other
credit enhancements to cover credit risk.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

20. Financial Instruments (continued)

Liquidity risk management

Ultimate responsibility for liquidity risk management rests with the board of directors,
which has established an appropriate liquidity risk management framework for the
management of the Company’s short, medium and long-term funding and liquidity
management requirements. The Company manages liquidity risk by maintaining
adequate reserves, banking facilities and reserve borrowing facilities, by continuously
monitoring forecast and actual cash flows, and by matching the maturity profiles of
financial assets and liabilities.

In addition, the Company has entered into a Financial Support Agreement under
which Abengoa has agreed to facilitate a US$50,000 thousand revolving credit line
and maintain any guarantees and letters of credit that have been provided by it on
behalf of or for the benefit of Abengoa Yield and its affiliates for a period of five years.
As of 31 December, 2014, the total amount of the credit line remains undrawn.

The following tables detail the Company’s remaining expected and contractual
maturity for its financial liabilities with agreed repayment periods. The tables have
been drawn up based on the undiscounted cash flows of financial liabilities based on
the earliest date on which the Company can be required to pay. The table includes
both interest and principal cash flows. The contractual maturity is based on the earliest
date on which the Company may be required to pay.

Weighted
average
effective
interest
rate

Less than
1 month

1-3
months

3 months
to 1 year 1-5 years

Total
% US$’000 US$’000 US$’000 US$’000 US$’000 US$’000

5+ years

December 31 2014
Variable interest rate
instruments
Fixed interest rate
instruments

2.99%

7.00%

103

123,399

2,152

252,760

103

2,152

376,159

123,502

254,912

378,414

Non derivative financial assets are primarily made up of amounts owed by group
undertakings which have no contractual maturities at less than five years, but will be
repaid depending on cash generated by the projects.

The Company has access to financing facilities as described above, of which none
were unused at the balance sheet date (2013: none). In addition, the Company has
entered into a financial support agreement with Abengoa S.A. The Group expects to
meet its other obligations from operating cash flows and proceeds of maturing
financial assets.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

20. Financial Instruments (continued)

Fair value measurements

The information set out below provides information about how the Company
determines fair values of various financial assets and financial liabilities.

Financial instruments measured at fair value are presented in accordance with the
following level classification based on the nature of the inputs used for the calculation
of fair value:

 Level 1: Inputs are quoted prices in active markets for identical assets or liabilities;

 Level 2: Fair value is measured based on inputs other than quoted prices included
within Level 1 that are observable for the asset or liability, either directly (i.e. as
prices) or indirectly (i.e. derived from prices);

 Level 3: Fair value is measured based on unobservable inputs for the asset or

liability.

Fair value of the Company’s financial assets and financial liabilities that are measured
at fair value on a recurring basis

The Company measures its available for sale financial asset preferred equity investment
in ACBH at fair value. The fair value as at 31 December 2014 was US$263 million
(2013: nil). The valuation method used to calculate the fair value of the preferred
equity investment in ACBH was discounting the US$18.4 million annual dividend,
using a discount rate of 7%.

The fair value hierarchy is level 3.

If the discount rate used were 1% higher or lower while all the other variables were
held constant, the carrying amount of this instrument would decrease by US$33
million or increase by US$44 million respectively.

Fair value of financial assets and financial liabilities that are not measured at fair value
on a recurring basis

The directors consider that the carrying amounts of financial assets and financial
liabilities recorded at amortised cost in the financial statements approximate their fair
values.

There were no financial liabilities subsequently measured at fair value on Level 3 fair
value measurement bases.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

21. Events after the balance sheet date

On 22nd January 2015, Abengoa closed an underwritten public offering and sale in the
United States of 10,580,000 of Abengoa Yield´s ordinary shares for total proceeds of
$327,980,000 (or $31 per share). Abengoa continues to beneficially own a majority of
our outstanding shares but, as a result of such offering, reduced its stake in Abengoa
Yield from approximately 64.3% to 51.1%.

In February 2015, pursuant to the ROFO Agreement, the Company agreed to acquire a
second set of assets from Abengoa (the “Second Dropdown”), which comprise an
aggregate of 200 MW of solar power generation, 10.5 million cubic feet per day of
water desalination and an 81-mile transmission line. The Second Dropdown Assets
consist of (i) two water desalination plants in Algeria, Honaine and Skikda, with an
aggregate capacity of 10.5 million cubic feet per day; (ii) an 81-mile transmission line
in Peru, ATN2; (iii) a solar power asset in Spain, Helioenergy 1/2, with a capacity of
100 MW; and (iv) a solar power asset in the United Arab Emirates, Shams, with a
capacity of 100 MW. On 3rd February 2015, the Company completed the acquisition of
a 25.5% stake in Honaine and a 34% stake in Skikda. The completion of the
acquisition of ATN2, the 30% stake in Helioenergy 1/2 and the 20% stake in Shams is
subject to satisfaction of customary conditions, including approvals from financing
institutions and, in certain cases, from partners in joint ventures.

22. Related party transactions

During the year, the Company entered into the following transactions with related
parties who are members of the Abengoa S.A. group:

Abengoa, S.A.
Abengoa Concessions, S.L.

2014
Other
operating
expenses
US$’000

2013
Other
operating
expenses
US$’000

2013
Revenue
US$’000

2014
Revenue
US$’000

4,126
-

-
(2,250)

4,126

(2,250)

-
-

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

22. Related party transactions (continued)

The following amounts were outstanding at the balance sheet date:

Abengoa, S.A.
Abengoa Solar, S.A.
Abengoa Concessions, S.L.

2014
Owed by
group
undertaking
US$’000

2014
Owed to
group
undertaking
US$’000

2013
Owed by
group
undertaking
US$’000

2013
Owed to
group
undertaking
US$’000

3,387

-
-

3,387

-
18
79

-
-
-

The Company has taken the exemption under IAS 24 of disclosing transactions with its
immediate and intermediate subsidiaries.

Aggregate directors’ remuneration

The total amounts for directors’ remuneration in accordance with Schedule 5 of the
Accounting Regulations were as follows:

Salaries, fees, bonuses and benefits in kind

2014
US$’000

2013
US$’000

440.8

The directors received no other benefits in respect of their services to the company,
including any share option or pension schemes. Further information about the
remuneration of individual directors is provided in the audited part of the Directors’
Remuneration Report on pages 15 to 18.

23. Contingent liabilities

Contingent liabilities are possible obligations, existing obligations with low probability
of a future outflow of economic resources and existing obligations where the future
outflow cannot be reliably estimated. The Company had no contingent liabilities as of
31 December 2014.

24. Guarantees and commitments

The Company did not issue any guarantees and commitments as of 31 December
2014.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

25. Service concessional arrangements

Below is a description of the concessional arrangements of the Abengoa Yield group.

In these parent only financial statements, they have been accounted for as investments
in subsidiaries at cost.

Solana
Solana is a 250 MW net (280 MW gross) solar electric generation facility located in
Maricopa County, Arizona, approximately 70 miles southwest of Phoenix. Arizona
Solar One LLC, or Arizona Solar, owns the Solana project. Solana includes a 22-mile
230kV transmission line and a molten salt thermal energy storage system. The
construction of Solana commenced in December 2010 and Solana reached COD on 9
October, 2013.

Solana has a 30-year, PPA with Arizona Public Service, or APS, approved by the
Arizona Corporation Commission (ACC). The PPA provides for the sale of electricity at
a fixed price per MWh with annual increases of 1.84% per year. The PPA includes
limitations on the amount and condition of the energy that is received by APS with
minimum and maximum thresholds for delivery capacity that must not be breached.

Mojave
Mojave is a 250 MW net (280 MW gross) solar electric generation facility located in
San Bernardino County, California, approximately 100 miles northeast of Los Angeles.
Abengoa commenced construction of Mojave in September 2011 and Mojave reached
COD on 1 December 2014.

Mojave has a 25-year, PPA with Pacific Gas & Electric Company, or PG&E, approved by
the California Public Utilities Commission (CPUC). The PPA will begin on COD. The PPA
provides for the sale of electricity at a fixed base price per MWh without any
indexation mechanism, including limitations on the amount and condition of the
energy that is received by PG&E with minimum and maximum thresholds for delivery
capacity that must not be breached.

Palmatir

Palmatir is an on-shore wind farm facility in Uruguay with nominal installed capacity of
50 MW. Palmatir has 25 wind turbines and each turbine has a nominal capacity of 2
MW. UTE (Administracion Nacional de Usinas y Transmisiones Electricas), Uruguay’s
state-owned electricity company, has agreed to purchase all energy produced by
Palmatir pursuant to a 20-year PPA.

Palmatir reached COD in May 2014. The wind farm is located in Tacuarembo, 170
miles north of the city of Montevideo.

Palmatir signed a PPA with UTE on 14 September, 2011 for 100% of the electricity
produced, approved by URSEA (Unidad Reguladora de Servicos de Energia y Agua).
UTE will pay a fixed-price tariff per MWh under the PPA, which is denominated in U.S.
dollars and will be partially adjusted in January of each year according to a formula
based on inflation.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

25. Service concessional arrangements (continued)

Cadonal

Cadonal is an on-shore wind farm facility in Uruguay with nominal installed capacity of
50 MW. Cadonal has 25 wind turbines and each turbine has a nominal capacity of 2
MW each. UTE (Administraction Nacional de Usinas y Trasmisiones Electricas),
Uruguay´s state-owned electricity company, has agreed to purchase all energy
produced by Cadonal pursuant to a 20-year PPA.

Cadonal reached COD in December 2014. The wind farm is located in Flores, 105
miles north of the city of Montevideo.

Cadonal signed a PPA with UTE on 28 December 2012 for 100% of the electricity
produced, approved by URSEA (Unidad Reguladora de Servicios de Energia y Agua).
UTE will pay a fixed tariff under the PPA per MWh under the PPA, which is
denominated in U.S. dollars and will be adjusted every January considering both US
and Uruguay´s inflation indexes and the exchange rate between Uruguayan pesos and
U.S. dollars.

Solaben 2 & 3
Solaben 2 and 3 are two 50 MW solar power facilities located in Spain. Solaben 2
reached COD in June 2012 and Solaben 3 reached COD in October 2012. Solaben
Electricidad Dos, S.A., or SE2, owns Solaben 2 and Solaben Electricidad Tres, S.A., or
SE3, owns Solaben 3.

Renewable energy plants in Spain, like Solaben 2 and Solaben 3, are regulated
through a series of laws which guarantee the owners of the plants a reasonable
remuneration for their investments. Solaben 2 and 3 sell the power they produce into
the wholesale electricity market, where offer and demand are matched and the pool
price is determined, and also receive additional payments from the Comision Nacional
de los Mercados y de la Competencia, or CNMC, the Spanish state-owned regulator.

Solacor 1 & 2

The Solacor 1 and 2 are two 50 MW solar power facilities located in Spain. The COD
was reached in January 2012 for Solacor 1 and in March 2012 for Solacor 2. JGC
Corporation holds 26% of Solacor 1 & Solacor 2, a Japanese engineering company.

Renewable energy plants in Spain, like Solacor 1 and 2, are regulated through a series
of laws and rulings which guarantee the owners of the plants a reasonable
remuneration for their investments. Solacor 1 and 2 sell the power they produce into
the wholesale electricity market, where offer and demand are matched and the pool
price is determined, and also receive additional payments from the Comision Nacional
de los Mercados y de la Competencia, or CNMC, the Spanish state-owned regulator.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

25. Service concessional arrangements (continued)

ACT

The ACT plant is a gas-fired cogeneration facility with a rated capacity of
approximately 300 MW and between 550 and 800 metric tons per hour of steam. The
plant
includes a substation and an approximately 52 mile and 115-kilowatt
transmission line.

On 18 September 2009, Abengoa Cogeneracion Tabasco entered into the Pemex
Conversion Services Agreement, or the Pemex CSA, with Petroleos Mexicanos, or
Pemex. Pemex is a state-owned oil and gas company supervised by the Comision
Reguladora de Energía (CRE), the Mexican state agency that regulates the energy
industry. The Pemex CSA has a term of 20 years from the in-service date and will
expire on 31 March 2033.

According to the Pemex CSA, ACT must provide, in exchange for a fixed price with
escalation adjustments, services including the supply and transformation of natural gas
and water into thermal energy and electricity. Part of the electricity is to be supplied
directly to a Pemex facility nearby, allowing the Comision Federal de Electricidad (CFE)
to supply less electricity to that facility. Approximately 90% of the electricity must be
injected into the Mexican electricity network to be used by retail and industrial end
customers of CFE in the region. Pemex is then entitled to receive an equivalent amount
of energy in more than 1,000 of their facilities in other parts of the country from CFE,
following an adjustment mechanism under the supervision of CFE.

The Pemex CSA is denominated in U.S. dollars. The price is a fixed tariff and will be
adjusted annually, part of it according to inflation and part according to a mechanism
agreed in the contract that on average over the life of the contract reflects expected
inflation. The components of the price structure and yearly adjustment mechanisms
were prepared by Pemex and provided to bidders as part of the request for proposal
documents.

ATN

Abengoa Transmision Norte, or the ATN Project, in Peru is part of the SGT (Sistema
Garantizado de Transmision), which includes all transmission line concessions allocated
by a bidding process by the government and is comprised of the following faciliti es:

(i)

(ii)

the approximately 356 mile, 220kV line from Carhuamayo-Paragsha-Conococha-
Kiman-Ayllu-Cajamarca Norte;

the 4.3 mile, 138kV link between the existing Huallanca substation and Kiman
Ayllu substations;

(iii)

the 1.9 mile, 138kV link between the 138kV Carhuamayo substation and the
220kV Carhuamayo substation;

(iv)

the new Conococha and Kiman Ayllu substations; and

(v)

the expansion of the Cajamarca Norte, 220kV Carhuamayo, 138kV Carhuamayo
and 220kV Paragsha substations.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

25. Service concessional arrangements (continued)

Pursuant to the initial concession agreement, the Ministry of Energy, on behalf of the
Peruvian Government, granted ATN a concession to construct, develop, own, operate
and maintain the ATN Project. The initial concession agreement became effective on
22 May 2008 and will expire 30 years after COD of the first tranche of the line, which
took place in January 2011. ATN is obliged to provide the service of transmission of
electric energy through the operation and maintenance of the electric transmission
line, according to the terms of the contract and the applicable law.

The laws and regulations of Peru establish the key parameters of the concession
contract, the price indexation mechanism, the rights and obligations of the operator
and the procedures that have to be followed in order to fix the applicable tariff, which
occurs through a regulated bidding process. Once the bidding process is complete and
the operator is granted the concession, the pricing of the power transmission service is
established in the concession agreement. ATN has a 30-year concession agreement
with a fixed-price tariff base denominated in U.S. dollars that is adjusted annually after
COD of each line, in accordance with the U.S. Finished Goods Less Food and Energy
Index published by the U.S. Department of Labor.

ATS

The Abengoa Transmision Sur, or ATS Project, in Peru is part of the Guaranteed
Transmission System, or (Sistema Garantizado de Transmisión) which includes all
transmission line concessions allocated by a bidding process by the government, and is
comprised of:

(i)

one 500kV electric transmission line and two short 220kV electric transmission
lines, which are linked to existing substations;

(ii)

three new 500kV substations; and

(iii)

three existing substations (two existing 220kV substations and one existing
550/220kV substation), through the development of new transformers, line
reactors, series reactive compensation and shunt reactions in some substations.

Pursuant to the initial concession agreement, the Ministry of Energy, on behalf of the
Peruvian Government, granted ATS a concession to construct, develop, own, operate
and maintain the ATS Project. The initial concession agreement became effective on
22 July 2010 and will expire 30 years after COD, which took place in January 2014.
ATS is obliged to provide the service of transmission of electric energy through the
operation and maintenance of the electric transmission line, according to the terms of
the contract and the applicable law.

ABENGOA YIELD PLC
Notes to the financial statements
Year ended December 31 2014

25. Service concessional arrangements (continued)

The laws and regulations of Peru establish the key parameters of the concession
contract, the price indexation mechanism, the rights and obligations of the operator
and the procedure that has to be followed in order to fix the applicable tariff, which
occurs through a regulated bidding process. Once the bidding process is complete and
the operator is granted the concession, the pricing of the power transmission service is
established in the concession agreement. ATS has a 30-year concession agreement
with fixed-price tariff base denominated in U.S. dollars that is adjusted annually after
COD of each line, in accordance with the U.S. Finished Goods Less Food and Energy
Index published by the U.S. Department of Labor.

Quadra 1 & Quadra 2

Transmisora Mejillones, or Quadra 1, is a 49-mile transmission line project and
Tranmisora Baquedano, or Quadra 2, is a 32-mile transmission line project, each
connected to the Sierra Gorda substations.

Both projects have concession agreements with Sierra Gorda SCM. The agreements
are denominated in U.S. dollars and are indexed mainly to CPI. The concession
agreements each have a 21-year term that began on COD, which took place in April
2014 and March 2014 for Quadra 1 and Quadra 2, respectively.

Quadra 1 and Quadra 2 belong to the Northern Interconnected System (SING), one of
the two interconnected systems into which the Chilean electricity market is divided
and structured for both technical and regulatory purposes.

As part of the SING, Quadra 1 and Quadra 2 and the service they provide are
regulated by several regulatory bodies, in particular: the Superintendent’s office of
Electricity and Fuels (Superintendencia de Electricidad y Combustibles, SEC), the
Economic Local Dispatch Center (Centro de Despacho Economico de Cargas, CDEC),
the National Board of Energy (Comision Nacional de Energia, CNE) and the National
Environmental Board (Comision Nacional de Medio Ambiente, CONAMA) and other
environmental regulatory bodies.

In all these concession arrangements, the operator has all the rights necessary to
manage, operate and maintain the assets and the obligation to provide the services
defined above, which are clearly defined in each concession contract and in the
applicable regulations in each country.

26. Controlling party

In the opinion of the directors, the company's ultimate parent company and ultimate
controlling party is Inversiones Corporativa S.A, a company incorporated in Spain. The
parent undertaking of the largest and smallest group, which includes the company
and for which group accounts are prepared, is Abengoa S.A, a company incorporated
in Spain. Copies of the group financial statements of Abengoa S.A. are available from
is Abengoa
Abengoa´s website. The company's
Concessions Investments Limited.

immediate controlling party