Market announcement

Title

Enefit Green interim report for Q3 2023

Message

The Enefit Green group's operating income for Q3 2023 decreased by 26% while
operating expenses for the period grew by 4% compared with the same period last
year. As a result, EBITDA dropped by 51% to EUR15.9m. Net profit for the period
decreased by EUR17.9m to EUR5.0m.

Aavo Kärmas, Chairman of the management Board of Enefit Green comments:

"Compared  to the exceptionally high electricity prices last year, prices on the
electricity  market have stabilized at new  levels. However, the fluctuations in
daily electricity prices in the Nord Pool price area continue to be high.

We  produced 37% more electricity in third quarter than a year earlier. New wind
and  solar parks  under construction  and those  already in  operation helped to
achieve  this. Among the assets under construction 72MW Tolpanvaara wind farm in
northern Finland started producing electricity. After a four-month shutdown, 11
out  of 14 wind turbines were restarted in September at the Akmene wind farm (75
MW) in Lithuania.

Despite  growing  production  results,  electricity  production  was  lower than
previously  planned. The  main reason  was the  missing production of the Akmene
wind  farm, but availability challenges also  had a significant impact. Overall,
the decline in electricity prices and lower-than-expected electricity production
affected  the economic results of the third quarter, as they caused larger-than-
expected   purchases   to  rebalance  the  electricity  portfolio  to  meet  the
obligations assumed under long-term PPAs.

Due  to seasonality, the last  quarter of the year  is very important for Enefit
Green,  and our main goal is to  maintain high availability of production assets
to  achieve high production results. We will  continue to work on the short- and
long-term  development portfolio  and keep  the focus  on hybrid solutions. When
making  new investment decisions, our  goal is to ensure  the promised return on
capital."


Webinar to present the results of Q3 2023

Today, November 2, 2023 at 13.00 EET Enefit Green will host a webinar in English
to  present and discuss its Q3  2023 results. To participate, please follow this
link                                      (https://teams.microsoft.com/l/meetup-
join/19%3ameeting_NzZlODJmYjctZDUyYy00NWNkLWE0MjAtYmNiMWU2MTMyN2Zh%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

  * Restart of Akmene wind farm
  * New 12-year EUR180m investment loan from EIB
  * Cornerstone to the Sopi-Tootsi renewable energy production area (255MW wind
    and 74MW solar farm)
  * First turbines started production in Tolpanvaara 72MW wind farm in Finland
  * Approval of phase one of a special spatial plan for wind power development
    in Lääne-Nigula

Key figures

                                               Q3 2023 Q3 2022 Change Change %

 PRODUCTION AND SALES VOLUMES

 Electricity production, GWh                       259     189     70      37%

 incl. new wind farms                               53       -     53        -

 Electricity sales                                 364     201    164      82%

 Heat energy production, GWh                       115      84     31      37%

 Pellet production, th t                            38      39    (1)     (2)%

 Pellet sales, th t                                 17      39   (22)    (56)%



 ELECTRICITY PRICES, EUR/MWh

 Core markets average*                            97.8   317.7  (220)    (69)%

 Implied captured price**                         84.9   205.1  (120)    (59)%



 OPERATING INCOME, mEUR                             44.5    60.3 (15.8)    (26)%

 Sales revenue, mEUR                                39.3    57.3 (18.0)    (31)%

 Renewable energy support and other income, mEUR     5.2     3.0    2.2      74%

 EBITDA, mEUR                                       15.9    32.7 (16.8)    (51)%

 NET PROFIT, mEUR                                    5.0    22.9 (17.9)    (78)%

 EPS, EUR                                           0.02    0.09 (0.07)    (78)%



 FINANCIAL LEVERAGE

 Net debt/EBITDA (LTM)                             3.2     0.7

* Production weighted average market price on group's core markets
** (electricity sales revenue + renewable energy support and efficient
cogeneration support + revenues from sale of guarantees of origin - day-ahead
and intraday purchases on Nord Pool - balancing energy purchases) / production


Sales revenue and other operating income

Total operating income decreased by EUR15.8m year on year, the figure comprising a
decrease  in revenue of EUR18.0m  and an increase in  renewable energy support and
other  operating income of EUR2.2m. Out of  the EUR18.0m decrease in revenue, EUR11.0m
was  attributable to electricity sales which  weakened mainly because the market
prices  of electricity were  lower than a  year earlier. The average electricity
price  in the  group's core  markets in  Q3 2023 was 97.8 EUR/MWh (Q3 2022: 317.7
EUR/MWh).  The group's average  implied captured electricity  price for the period
was  84.9 EUR/MWh (Q3  2022: 205.1 EUR/MWh). The  implied captured electricity price
differs  from  the  average  market  price  in  the  core markets, because it is
calculated  by taking into account  long-term fixed-price 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 Q3 2023 was 82.2
EUR/MWh  compared with 285.2 EUR/MWh  a year earlier.  The group sold  to the market
163 GWh of electricity in Q3 2023 compared with 120 GWh in Q3 2022.

In Q3 2023, 202 GWh of the group's portfolio was covered with PPAs at an average
price  of 80.9 EUR/MWh. A  year earlier,  81 GWh of  electricity was sold under an
income  model based on PPAs and the Feed-in  Tariff (FiT) at an average price of
72.1 EUR/MWh.  The  share  and  prices  of  production covered with PPAs in future
periods are disclosed in the risk management chapter of the interim report.

We  purchased from  the market  110 GWh of  electricity at  an average  price of
116.5 EUR/MWh  in Q3 2023, compared with 16 GWh at an average price of 337.7 EUR/MWh
in  the same period last year (the prices and quantities exclude the electricity
purchased  for pellet  production). In  Q3 2022, purchases  from the market were
substantially smaller because part of the production was covered with the fixed-
price  FiT support  scheme and  the volume  of PPAs  was very small. Electricity
purchases were also increased by lower than expected electricity production.

Pellet  sales revenue decreased by  EUR3.0m year on year.  While the average sales
price of pellets increased by 32%, rising from 182.6 EUR/t in Q3 2022 to 240.6 EUR/t
in  Q3  2023, pellet  sales  volume  decreased  from  39 thousand  tonnes in the
comparative period to 17 thousand tonnes in the reporting period.

Heat  production  grew  by  31 GWh  to  115 GWh  (Q3 2022: 84 GWh) but the price
dropped by 14% (1.8 EUR/MWh). Through the combined effect of higher production and
a lower price, heat sales revenue grew by EUR1.3m.

Revenue for Q3 2022 was also EUR3.2m higher due the sale of the inventories of the
turnkey solar solutions business. We decided to exit the turnkey solar solutions
business and sold relevant inventories in the comparative period.

Renewable  energy support and  other operating income  for Q3 2023 were affected
the  most by  renewable energy  support, which  grew by  EUR1.4m year on year. The
growth  in renewable energy support was influenced by the support schemes of our
solar  farms in Poland: in  Q3 2022 we had to  repay renewable energy support of
EUR0.7  million under the Polish CfD schemes. Renewable energy support received in
Poland in Q3 2023 amounted to EUR16k. The renewable energy support received by our
operating wind farms in Estonia and the Iru power plant grew by EUR0.3m and EUR0.4m,
respectively.  The amount of  renewable energy support  received is based on the
quantity  of energy produced.  Although the eligibility  periods of the Vanaküla
and  Virtsu III wind farms expired  in Q3 2022 (contribution to operating income
for  the  comparative  period:  EUR0.2m),  the  output  of wind farms eligible for
support  in both  periods grew  by 13.6 GWh  year on  year (impact  on operating
income:  +EUR0.5m). The renewable energy  output of the Iru  power plant grew from
6.2 GWh a year earlier to 10.5 GWh, increasing operating income by EUR0.4m.

Other  operating  income  was  improved  by  the  decrease in the non-derivative
contract  liability  incurred  in  2021 by  EUR0.4m  in  connection  with  partial
fulfilment of relevant PPAs and liquidated damages of EUR0.4m received for the low
availability  of  the  Shilute  wind  farm. The non-derivative contract liability
results  from  earlier  electricity  derivatives  (base  load  swaps) which were
converted  into  fixed-price  physical  electricity  sales contracts (PPAs). The
decrease  in the non-derivative contract liability does not affect cash flow and
monetary settlement of electricity sales takes place on the basis of PPAs.

EBITDA and segmental breakdown

The  factor with  the strongest  impact on  EBITDA development  was the price of
electricity  sold, which  fell steeply  compared with  Q3 2022 (negative impact:
EUR25.1m).  Due  to  PPAs  the  quantity  of  electricity  sold  grew considerably
(positive  impact:  EUR15.5m),  which  also  increased  the  volume of electricity
purchased  to balance the  electricity portfolio (negative  impact: EUR11.2m). The
combined  effect of the above factors on EBITDA development is influenced by the
quantity  and  profile  of  electricity  produced during the period. Electricity
production grew by 37% compared with Q3 2022.

Excluding  the effects of  the electricity price  and quantity, the Cogeneration
segment  had  a  EUR1.9m  positive  impact  on  EBITDA. The calculation takes into
account  the  effects  of  pellet  sales  revenue,  the  change  in inventories,
technological fuel, and heat sales revenue.

The  change in the non-derivative liability  increased EBITDA. See the renewable
energy support and other operating income description above for details.

Fixed  costs comprise  costs not  directly dependent  on the  production volume.
Fixed  costs grew by EUR2.2m  (24%) year on year.  The increase in fixed costs was
attributable  to higher  maintenance costs,  payroll expenses,  and research and
consulting expenses.

Based  on total operating income and EBITDA, the group's largest segment is Wind
energy,  which accounted  for 61% of  operating income  and 64% of EBITDA for Q3
2023. The  Cogeneration segment  contributed 33% to  operating income and 41% to
EBITDA. The smallest reportable segment is Solar energy, which accounted for 6%
the group's operating income and 10% of the group's EBITDA for Q3 2023. In terms
of  reportable  segments,  the  EBITDA  of  the  Wind  energy  segment  and  the
Cogeneration  segment decreased the most. A more detailed analysis by segment is
presented in the attached report.

Net profit

The group's net profit decreased by EUR17.9m year on year to EUR5.0m. The decline is
attributable  to  lower  electricity  prices  and higher expenses on electricity
purchased to balance the electricity portfolio.

Capital Expenditures

The  group invested  EUR87.3m in  Q3 2023, which  is EUR7.5m  more than in Q3 2022.
Growth  resulted from development investments, which  extended to EUR85.6m. Of the
latter,  EUR79.0m was invested in the construction  of three wind farms: EUR45.4m in
the  Kelme wind  farm, EUR18.9m  in the  Sopi-Tootsi wind  farm and  EUR14.8m in the
Tolpanvaara  wind farm. The largest solar energy development investment was made
in the Sopi solar project in the amount of EUR1.9m.

Expenditure  on the maintenance and improvement  of existing assets increased by
EUR0.8m  year on year, rising to EUR1.7m  in Q3 2023. Maintenance expenditure of the
period was mainly related to Estonian wind farms.

Financing

During Q3 2023, to finance its continuing investment activity Enefit Green drew
down EUR60m of an investment loan raised from NIB which matures in 2035 and signed
an additional 12-year investment loan agreement of EUR180m with EIB. The amortised
cost of the group's interest-bearing liabilities at 30 September 2023 was
EUR411.3m (31 December 2022: EUR279.6m). Loan liabilities to banks accounted for
EUR407.0m of the total.

The average interest rate of bank loans drawn down at 30 September 2023 was
3.80% (31 December 2022: 2.60%). For about 39% of loan liabilities, the interest
rate risk has been hedged until maturity of the respective loan contracts.

Investment loans raised but not drawn down at 30 September amounted to EUR405m.


Condensed consolidated interim income statement

-------------------------------------------------------------------------------
 EUR thousand                                  Q3 2023  Q3 2022  9M 2023  9M 2022
-------------------------------------------------------------------------------
 Revenue                                      39,259   57,254  144,600  156,900

 Renewable energy support and other
 operating income                              5,233    3,011   18,562   17,363

 Change in inventories of finished goods
 and work in progress                          3,434    2,028    3,266    4,607

 Raw materials, consumables and services
 used                                       (26,011) (24,969) (71,386) (55,468)

 Payroll expenses                            (2,634)  (2,029)  (8,025)  (6,641)

 Depreciation, amortisation and impairment  (10,218)  (9,637) (29,740) (28,930)

 Other operating expenses                    (3,388)  (2,574) (10,716)  (7,721)

 OPERATING PROFIT                              5,675   23,084   46,561   80,110

 Finance income                                  747      468    2,345      718

 Finance costs                               (1,115)    (722)  (1,897)  (1,275)

 Net finance income and costs                  (368)    (255)      448    (558)

 Profit from associates under the equity
 method                                           45      120       85      687

 PROFIT BEFORE TAX                             5,352   22,949   47,094   80,239

 Income tax expense                            (326)        0 (10,405)  (5,441)

 PROFIT FOR THE PERIOD                         5,026   22,949   36,689   74,798



 Basic and diluted earnings per share

 Weighted average number of shares,
 thousand                                    264,276  264,276  264,276  264,276

 Basic earnings per share, EUR                    0.02     0.09     0.14     0.28

 Diluted earnings per share, EUR                  0.02     0.09     0.14     0.28


Condensed consolidated interim statement of financial position

---------------------------------------------------------------------------
  EUR thousand                                    30 Sept 2023   31 Dec 2022
---------------------------------------------------------------------------
  ASSETS

  Non-current assets

  Property, plant and equipment                      978,497       776,870

  Intangible assets                                   60,275        60,382

  Right-of-use assets                                  4,295         4,239

  Prepayments for non-current assets                  42,522        19,412

  Deferred tax assets                                  1,379         1,321

  Investments in associates                              568           506

  Derivative financial instruments                     9,310        11,277

  Non-current receivables                                  0            40

  Total non-current assets                         1,096,846       874,047



  Current assets

  Inventories                                         19,177        14,227

  Trade and other receivables and prepayments         59,765        41,091

  Cash and cash equivalents                           25,731       131,456

  Derivative financial instruments                     4,473         3,349

  Total current assets                               109,146       190,123

  Total assets                                     1,205,992     1,064,170
---------------------------------------------------------------------------


-------------------------------------------------------------------------------
 EUR thousand                                            30 Sept 2023 31 Dec 2022
-------------------------------------------------------------------------------
 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                                    5,555       3,259

 Other reserves                                             167,621     166,419

 Foreign currency translation reserve                         (709)       (762)

 Retained earnings                                          204,613     225,190

 Total equity                                               701,707     718,733



 LIABILITIES

 Non-current liabilities

 Borrowings                                                 334,639     255,755

 Government grants                                            6,745       7,115

 Non-derivative contract liability                           18,086      18,086

 Deferred tax liabilities                                    12,445      12,326

 Other non-current liabilities                                3,000       3,000

 Provisions                                                       8           9

 Total non-current liabilities                              374,923     296,291

 Current liabilities

 Borrowings                                                  76,686      23,808

 Trade and other payables                                    51,107      20,215

 Provisions                                                       2           2

 Non-derivative contract liability                            1,567       5,121

 Total current liabilities                                  129,362      49,146

 Total liabilities                                          504,285     345,437

 Total equity and liabilities                             1,205,992   1,064,170
-------------------------------------------------------------------------------


Further information:
Sven Kunsing
Head of Finance Communications
[email protected]
(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 diversified renewable energy producers in the
Baltic Sea area. The Company operates wind farms in Estonia and Lithuania,
cogeneration plants in Estonia and Latvia, solar farms in Estonia and Poland, a
pellet plant in Latvia and a hydroelectric plant in Estonia. In addition, the
Company is developing several wind and solar farms in the mentioned countries
and Finland. As of the end of 2022, the Company had a total installed
electricity production capacity of 457 MW and a total installed heat production
capacity of 81 MW. During 2022, the Company produced 1,118 GWh of electricity,
565 GWh of heat energy and 154 thousand tonnes of wood pellets.