Enefit Green group's operating income for Q1 2024 decreased by 11% while
operating expenses for the period decreased by 22% compared to the same period
last year. As a result, EBITDA increased by 3% to EUR42.4m and net profit for the
quarter increased by 10% to EUR33.4m (earnings per share EUR0.13).
Aavo Kärmas, Chairman of the management Board of Enefit Green comments:
"We produced 494 gigawatt-hours of electricity (+22%) and 129 gigawatt-hours of
thermal energy (-27%). The increase in electricity production by a fifth was
driven by newly completed wind and solar farms and those under construction
(+131 gigawatt-hours). The decrease in heat output was mainly due to the sale of
biomass assets.
We focused on the completion of wind and solar farms under construction and
invested nearly 105 million euros. We completed construction works at
Tolpanvaara wind farm in Finland. In Lithuania at Akmene wind farm, the
collapsed wind turbine was replaced and first wind turbines were erected in
Kelm? I wind farm. At Sopi-Tootsi renewable energy area in Estonia, we have
reached the installation stage of wind turbines, installation of solar panels is
already ongoing. Compared to the second half of last year, we have significantly
improved the availability of Shilut? wind farm in Lithuania and we continue to
maintain good availability of the WinWind wind turbines in Estonia.
Quarterly KPIs were affected by lower electricity market prices and the prices
of the concluded power purchase agreements (PPA). Due to the setup activities at
the wind farms under construction and low wind speeds, the electricity
production target was not achieved (-95 gigawatt-hours), which continued to
cause significant volumes of electricity purchases.
This year our focus is on timely completion of the wind and solar farms under
construction and maintaining the high availability of existing assets. We will
also continue to work with the development portfolio to increase the value of
the company in the longer run."
Webinar to present the results of Q1 2024
Today, 2 May 2024 at 13.00 EEST Enefit Green will host a Webinar in English to
present and discuss its Q1 2024 results. To participate, please follow this link
(https://teams.microsoft.com/l/meetup-
join/19%3ameeting_NzM5ZDc3NWEtOTdkZi00MzdkLTk4ZjgtODcxNjc1ZTE5OWU5%40thread.v2/0
?context=%7B%22Tid%22%3A%2215cd778b-2b28-4ebc-956c-
b5977a36cd28%22%2C%22Oid%22%3A%22775ae01b-e561-
4cc9-8790-1290c7b28035%22%2C%22IsBroadcastMeeting%22%3Atrue%2C%22role%22%3A%22a%
22%7D&btype=a&role=a).
Significant events
* Completion of construction works at the Tolpanvaara wind farm in Finland
* At Akmene wind farm in Lithuania, wind turbine that collapsed last year was
replaced, start of negotiations with GE regarding compensation for the
damage
* Installation of wind turbines started at Kelm? I wind farm in Lithuania
* Preparations for the installation of wind turbines are being finalized at
the Sopi-Tootsi wind farm
* Co-development agreement with RES Global Investment regarding wind farms in
Poland (up to 360 MW)
* Direct line power purchase agreement with Elcogen in Estonia
* With closing of the sale of Valka and Paide cogeneration plants, we have
completed the exit from biomass assets
* In agreement with the supervisory board, chairman of the management Board
Aavo Kärmas will resign as of 1 July 2024
Key figures
+---------------------------------------------+-------+-------+------+--------+
| |Q1 2024|Q1 2023|Change|Change %|
+---------------------------------------------+-------+-------+------+--------+
|PRODUCTION AND SALES VOLUMES | | | | |
+---------------------------------------------+-------+-------+------+--------+
|Electricity production, GWh | 494| 406| 89| 22%|
+---------------------------------------------+-------+-------+------+--------+
|incl. new wind and solar farms | 169| 38| 131| 343%|
+---------------------------------------------+-------+-------+------+--------+
|Electricity sales | 627| 495| 133| 27%|
+---------------------------------------------+-------+-------+------+--------+
|Heat energy production, GWh | 129| 176| (47)| (27)%|
+---------------------------------------------+-------+-------+------+--------+
| | | | | |
+---------------------------------------------+-------+-------+------+--------+
|OPERATING INCOME, mEUR | 68.9| 77.5| (8.6)| (11)%|
+---------------------------------------------+-------+-------+------+--------+
|Sales revenue, mEUR | 56.2| 69.7|(13.5)| (19)%|
+---------------------------------------------+-------+-------+------+--------+
|Renewable energy support and other income, mEUR| 12.7| 7.8| 4.9| 63%|
+---------------------------------------------+-------+-------+------+--------+
|EBITDA, mEUR | 42.4| 41.1| 1.3| 3%|
+---------------------------------------------+-------+-------+------+--------+
|NET PROFIT, mEUR | 33.4| 30.5| 2.9| 10%|
+---------------------------------------------+-------+-------+------+--------+
|EPS, EUR | 0.13| 0.12| 0.01| 10%|
+---------------------------------------------+-------+-------+------+--------+
Sales revenues and other operating income
The group's total electricity production grew by 89 GWh (+22%) to 494 GWh in Q1,
with electricity production at new wind and solar farms and wind and solar farms
under construction increasing by 131 GWh. Nevertheless, electricity production
was around 95 GWh lower than forecasted. This was due to weather conditions
(mainly lower than expected wind speeds) as well as low availability of wind
farms under construction. The negative impacts to production compared to the
projections were -42 GWh and -47 GWh respectively.
Total operating income decreased by EUR8.6m, the figure reflecting a decrease in
revenue of EUR13.5m and an increase in renewable energy support and other
operating income of EUR4.9m. Operating income for Q1 2023 includes EUR20.0m
generated by assets sold in Q4 2023 and Q1 2024 EUR8.0m ('assets sold'). Excluding
the impact of assets sold, the group's operating income was EUR57.5m for Q1 2023
and EUR60.9m for Q1 2024 and operating income grew by EUR3.4m, the figure reflecting
revenue growth of EUR4.1m and a decrease in other operating income of EUR0.7m.
Of the EUR4.1m revenue growth, EUR4.9m resulted from electricity sales revenue that
was driven by higher production. In Q1 2024, the average electricity price in
the group's core markets was EUR87.0 EUR/MWh (Q1 2023: EUR100.5/MWh). The group's
average implied captured electricity price was EUR81.4/MWh (Q1 2023: EUR101.2/MWh).
The implied captured electricity price differs from the average market price in
the group's core markets, because it takes into account long-term fixed-price
power purchase agreements (PPAs), renewable energy support, purchases of
balancing energy, electricity purchases from the Nord Pool day-ahead and
intraday markets and the fact that wind farms do not produce the same amount of
electricity every hour.
The group's average price of electricity sold to the market in Q1 2024 was
EUR77.6/MWh compared with EUR82.4/MWh a year earlier. The group sold 292 GWh of
electricity to the market in Q1 2024 compared with 234 GWh a year earlier.
In Q1 2024, 335 GWh of the group's electricity production was covered by PPAs
signed at an average price of EUR75.0/MWh. A year earlier, 260 GWh of electricity
was sold under PPAs at an average price of EUR89.8/MWh. The average price of
electricity sold under PPAs has decreased significantly year on year because the
settlement periods of PPAs signed in Lithuania and Finland in 2021 at lower
prices began in Q1 2024.
In Q1 2024, we purchased 138 GWh of electricity from the market at an average
price of EUR106.1/MWh, compared with 92 GWh at an average price of EUR116.7/MWh in
Q1 2023 (the prices and volumes exclude the electricity purchased for pellet
production in Q1 2023). The volume of electricity purchased increased because
sales under PPAs and the share of production covered by PPAs have increased and
therefore the purchases needed to balance the baseload PPA portfolio have also
increased. The purchase price decreased compared to Q1 2023 because the market
price has declined, but due to a higher wind profile discount the difference
between the purchase price and the market price increased. In Lithuania, the Q1
wind profile discount increased by 3.3 percentage points year on year, rising to
15%. In Estonia, the wind profile discount rose by 0.4 percentage points to
13.5%. In 2024, we started to supply electricity under a PPA in Finland, which
is why we also started to purchase electricity in Finland. In Finland, the wind
profile discount in Q1 2024 was 28.1%.
Renewable energy support and other operating income increased by EUR4.9m. The
figure reflects the gain on the sale of the Paide and Valka CHP plants of EUR5.4m
and a decrease in renewable energy support of EUR0.8m. The amount of renewable
energy support received is based on the quantity of energy produced by wind
farms eligible for support, which in Q1 2024 was 12.0 GWh lower than a year
earlier.
EBITDA and segmental breakdown
The factor with the strongest impact on EBITDA development was the price of
electricity sold, which decreased compared to Q1 2023 (impact: -EUR8.3m). Due to
PPAs, the quantity of electricity sold grew considerably (impact: +EUR12.3m),
which also increased the volume of electricity purchased to balance the
electricity portfolio (impact: -EUR4.7m). The combined effect of the above factors
on EBITDA development is influenced by the volume and profile of electricity
produced during the period. Electricity production grew by 22% year on year.
The impact of assets sold on EBITDA development was +EUR3.1m. The largest item was
the gain on the sale of the Paide and Valka CHP plants of EUR5.5m.
Excluding the effects of the electricity price and volume, Iru cogeneration
plant had a negative impact on EBITDA. The calculation takes into account the
effects of heat energy, gate fees for waste received and technological fuel. The
EBITDA of the Iru cogeneration plant decreased because gate fees decreased by
EUR0.7m due to a decline in the volume of waste received and expenses on natural
gas increased by EUR0.3m due an unplanned production interruption in February
during which replacement heat was produced from natural gas.
Fixed costs excluding the fixed costs of assets sold grew by EUR1.0m. The increase
was attributable to higher maintenance costs and IT expenses.
Based on total operating income and EBITDA, the group's largest segment is wind
energy, which accounted for 73% of operating income and 76% of EBITDA for Q1
2024. The cogeneration segment contributed 25% to operating income and 32% to
EBITDA. The smallest reportable segment is solar energy, which accounted for 1%
the group's operating income and 1% of the group's EBITDA for Q1 2024.
EBITDA of all reported segments increased compared to the reference period (by
EUR1.2m, EUR0.6m and EUR0.1m for the wind, cogeneration and solar energy segments
respectively). The change of EBITDA of the cogeneration segment was positively
affected by assets sold (+EUR3.1m) and negatively by Iru power plant (-EUR2.5m).
Net profit
The group's net profit increased by EUR2.9m to EUR33.4m in the reporting period. The
growth in net profit was supported by an increase in EBITDA, a decrease in
depreciation of EUR0.5 million (increase of depreciation stemming from new
operating assets, decrease of depreciation due to assets sold), an increase in
net financial income by EUR0.2m and a decrease in income tax expense by EUR0.9m.
Capital Expenditures
The group invested EUR104.8m in Q1 2024, which is EUR12.9m more than in Q1 2023.
Growth resulted from development investments, which extended to EUR104.7m. Of
this, EUR77.6m was invested in the construction of three wind farms: EUR64.8m in the
Sopi-Tootsi wind farm and EUR12.9m in the Kelme wind farms - EUR10.4m in Kelme I and
EUR2.5 in Kelme II. The largest solar energy development investment was made in
the Sopi solar project in the amount of EUR17.6m.
Base investments remained on a negligible level of EUR0.1m.
Financing
At 31 March 2024, the amortised cost of the group's interest-bearing liabilities
was EUR503.2m (31 December 2023: EUR482.4m). In Q1 2024, the group drew down bank
loans of EUR30m and the level of investment loans raised but not drawn down at 31
March 2024 amounted to EUR285m. The average interest rate of bank loans drawn down
at 31 March 2024 was 3.79% (31 December 2023: 3.75%). Net debt/EBITDA ratio
stood at a level of 4.39 (31 December 2023: 3.97). The ratio's increase is
corresponding to the expectation due to the large number of development projects
under construction.
Condensed consolidated interim income statement
-------------------------------------------------------------------------------
EUR thousand Q1 2024 Q1 2023
-------------------------------------------------------------------------------
Revenue 56,192 69,691
Renewable energy support and other operating income 12,729 7,813
Change in inventories of finished goods and work in progress 0 (5,060)
Raw materials, consumables and services used (20,674) (24,792)
Payroll expenses (2,225) (2,486)
Depreciation, amortisation and impairment (9,342) (9,815)
Other operating expenses (3,595) (4,055)
OPERATING PROFIT 33,085 31,296
Finance income 570 407
Finance costs (306) (380)
Net finance income and costs 264 27
Profit (loss) from associates under the equity method (10) 19
PROFIT BEFORE TAX 33,339 31,342
Income tax income (expense) 107 (820)
PROFIT FOR THE PERIOD 33,446 30,522
Basic and diluted earnings per share
Weighted average number of shares, thousand 264,276 264,276
Basic earnings per share, EUR 0.13 0.12
Diluted earnings per share, EUR 0.13 0.12
Condensed consolidated interim statement of financial position
---------------------------------------------------------------------------
EUR thousand 31 March 2024 31 December 2023
---------------------------------------------------------------------------
ASSETS
Non-current assets
Property, plant and equipment 1,123,597 1,027,057
Intangible assets 59,857 59,891
Right-of-use assets 8,764 9,097
Prepayments for non-current assets 54,240 55,148
Deferred tax assets 2,095 2,013
Investments in associates 538 548
Derivative financial instruments 5,169 5,054
Non-current receivables 1,826 0
Total non-current assets 1,256,086 1,158,808
Current assets
Inventories 3,402 3,180
Trade and other receivables and prepayments 40,930 55,082
Derivative financial instruments 3,720 3,806
Cash and cash equivalents 34,989 65,677
83,041 127,745
Assets classified as held for sale 0 15,370
---------------------------------------------------------------------------
Total current assets 83,041 143,115
---------------------------------------------------------------------------
Total assets 1,339,127 1,301,923
---------------------------------------------------------------------------
-------------------------------------------------------------------------------
EUR thousand 31 March 2024 31 December 2023
-------------------------------------------------------------------------------
EQUITY
Equity and reserves attributable to
shareholders of the parent
Share capital 264,276 264,276
Share premium 60,351 60,351
Statutory capital reserve 5,556 5,556
Other reserves 164,566 163,451
Foreign currency translation reserve (108) (162)
Retained earnings 257,163 223,718
Total equity 751,804 717,190
LIABILITIES
Non-current liabilities
Borrowings 437,916 454,272
Government grants 3,054 3,102
Non-derivative contract liability 12,471 12,497
Deferred tax liabilities 12,412 12,412
Other non-current liabilities 5,239 5,239
Provisions 8 8
Total non-current liabilities 471,100 487,530
Current liabilities
Borrowings 67,685 32,126
Trade and other payables 44,870 54,445
Provisions 6 6
Non-derivative contract liability 3,662 5,674
116,223 92,251
Liabilities directly associated with assets
classified as held for sale 0 4,952
Total current liabilities 116,223 97,203
Total liabilities 587,323 584,733
Total equity and liabilities 1,339,127 1,301,923
-------------------------------------------------------------------------------
Further information:
Sven Kunsing
Head of Finance Communications
investor@enefitgreen.ee
(https://www.globenewswire.com/Tracker?data=eahglFI0K4UUxwsmqXkQdO3N_ld1uojlGTE_
vteiKcyQu1wfu3r9tXxEfe64TI9iPjXXdLcA-1wKJKK402r4cwPqdjBXLG-Ga36PZFEEUJ4=)
https://enefitgreen.ee/en/investorile/
(https://www.globenewswire.com/Tracker?data=2hvtWZj2Sah7P5FHBmegLeIoMx1_pu7PK9v_
TsWBkf9HVGRVBco0gBWNAR8sTIf_RfHfPw1v74a_H6m3SjVkIBzGyIVVbjGOe57EOq9-
agKg8ttz2h5EHYmF0la-hs-rAYHvQm2Fvlu3QknP8tcDCA==)
Enefit Green is one of the leading renewable energy producers in the Baltic Sea
area. The Company operates wind farms in Estonia and Lithuania, waste-to-energy
CHP plant in Estonia, solar farms in Estonia and Poland and a hydroelectric
plant in Estonia. In addition, the Company is developing several wind and solar
farms in the mentioned countries, Latvia and Finland. As of the end of 2023, the
Company had a total installed electricity production capacity of 515 MW and a
total installed heat production capacity of 50 MW. During 2023, the Company
produced 1,343 GWh of electricity, 604 GWh of heat energy and 156 thousand
tonnes of wood pellets. In the end of 2023, Enefit Green exited the biomass
based CHP and pellet production businesses.
|