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Enefit Green interim report for Q2 2024

Teade

The Enefit Green group's operating income for Q2 2024 decreased by 7% while
operating expenses (excl. D&A) decreased by 12% compared to the same period last
year. As a result, EBITDA decreased by 2% to EUR19.3m. Net profit for the quarter
increased by EUR2.8m to EUR3.9m (earnings per share EUR0.015).

Andres  Maasing,  interim  chairman  of  the  management  board  of Enefit Green
comments:

"Construction  activities are  underway in  several development sites, including
three  large wind farms in Estonia and  Lithuania, with a total capacity of 422
megawatts.  Investments during  the last  quarter exceeded  a tenth of our total
ongoing investment programme. The volume of investments required to complete all
ongoing constructions is close to EUR250m.

In  the Sopi-Tootsi wind farm, 25 of the 38 wind turbines have been erected, and
the  installation of  the remaining  turbines is  proceeding as  planned. In the
solar  farm, which we  are building in  the close vicinity,  installation of the
panel  frames is  about to  be completed  and the  installation of the panels is
already  ongoing. In Lithuania,  in the Kelm?  I wind farm  all 14 wind turbines
have  been erected, and turbine foundations are being built in the Kelm? II wind
farm.  In Latvia,  we are  building our  first solar  farms. We  expect to start
generating  electricity in  all these  projects later  this year, except for the
Kelm? II wind farm, which will take longer to complete.

In  the second quarter, we produced 358 gigawatt-hours of electricity (+35% y-o-
y)  and 96 gigawatt-hours of thermal  energy (-27%). The significant increase in
electricity  production for several quarters  in a row is  due to the production
from  both wind and solar farms already  commissioned and from those still under
construction.  During the last  year and a  half, a total  of eight new projects
have  started generating electricity,  of which five  have been commissioned and
three are nearing the end of construction.

The  contribution  of  new  production  assets  in  our  production portfolio is
gradually  growing, but the achievement of the electricity production target has
been primarily affected by lower wind speeds and the configuration activities of
new  wind  farms  (especially  in  the  Tolpanvaara  wind farm). The performance
indicators  for the quarter were affected  by lower market prices of electricity
and higher-than-expected output.

We  continue  to  focus  on  completing  ongoing  construction projects on time,
maintaining  high  availability,  and  working  to  bring  storage  and hydrogen
technologies to market."


Webinar to present the results of Q2 2024

Today,  1 August 2024 at 13.00 EEST Enefit Green  will host a Webinar in English
to  present and discuss its Q2  2024 results. To participate, please follow this
link                                      (https://teams.microsoft.com/l/meetup-
join/19%3ameeting_NGJkZjMxMDgtMGFhOC00ZTM3LWE5MzEtZjM1YzFhMzNjZjE2%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

  * The Supervisory Board of Enefit Green has appointed Juhan Aguraiuja as the
    new Chairman of the Management Board. Mr Aguraiuja will take office on 14
    October
  * CFO Veiko Räim will not be applying for a new term as a member of the
    Management Board after the end of the current contract on 24 September
  * Active construction activities in major Sopi-Tootsi (255 MW), Kelm? I (80
    MW), Kelm? II (87 MW) wind farms and Sopi solar farm (74 MW)
  * Commissioning of the Tolpanvaara wind farm (72 MW) in Finland
  * Amendment of the Swedbank loan agreement: increased loan amount to EUR100m and
    extension of the term to December 2028
  * Purtse hybrid farm passed Elering's grid compliance tests


Key figures

                                               Q2 2024 Q2 2023 Change Change %

 PRODUCTION AND SALES VOLUMES

 Electricity production, GWh                       358     265     93      35%

 incl. new wind and solar farms                    141      56     85     152%

 incl. assets sold                                   -       9    (9)   (100)%

 Electricity sales                                 460     357    103      29%

 Heat energy production, GWh                        96     141   (45)    (32)%



 OPERATING INCOME, mEUR                             38.3    41.2  (2.9)     (7)%

 Sales revenue, mEUR                                33.9    36.8  (2.9)     (8)%

 Renewable energy support and other income, mEUR     4.4     4.4    0.0     (1)%

 EBITDA, mEUR                                       18.9    19.3  (0.4)     (2)%

 NET PROFIT, mEUR                                    3.9     1.1    2.8     246%

 EPS, EUR                                          0.015   0.004  0.011     246%


Sales revenue and other operating income

The  group's Q2 electricity production grew by 93 GWh (35%) to 358 GWh, with the
output  of new wind and solar farms increasing by 85 GWh. Heat energy production
decreased  by  45 GWh  (32%).  The  comparison  of  the  group's  Q2 performance
indicators  is strongly affected by the sale of the Broc?ni CHP plant and pellet
factory, which was completed in Q4 2023, and the sale of the Paide and Valka CHP
plants,  which was  completed in  March 2024 ('assets  sold'). Assets sold had a
negative impact, reducing Q2 electricity and heat energy production by 9 GWh and
36 GWh respectively compared to Q2 2023.

Electricity  production in  Q2 was  about 61 GWh  lower compared  to our earlier
forecast.  More than half of  this shortfall was driven  by weaker than expected
wind  conditions, the  remainder was  primarily driven  by lower availability of
wind  farms under construction and of Iru  power station, but also by production
curtailments  (related both to negative  prices as well as  those ordered by DSO
(in Poland)).

Total  operating income decreased by EUR2.9m,  the figure reflecting a decrease in
revenue  of  EUR2.9m,  an  increase  in  renewable  energy  support of EUR0.6m and a
decrease  in  other  operating  income  of  EUR0.8m.  The effect of assets sold on
operating  income was positive at  EUR4.7m in Q2 2023 and  negative at EUR0.8m in Q2
2024.

Excluding  the  impact  of  assets  sold,  i.e. operating income from continuing
operations, was EUR36.5m for Q2 2023 and EUR39.1m for Q2 2024 (operating income grew
by EUR2.5m, the figure reflecting revenue growth of EUR1.7m and an increase in other
operating income of EUR0.8m).

Of  the EUR1.7m growth in revenue  from continuing operations, EUR2.1m resulted from
electricity  sales revenue that was driven by higher production. In Q2 2024, the
average  electricity price in the group's  core markets was EUR72.2/MWh (Q2 2023:
EUR78.7/MWh). The group's average implied captured electricity price was EUR69.7/MWh
(Q2  2023: EUR89.3/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  Q2 2024 was
EUR52.3/MWh  (Q2 2023: EUR63.7/MWh).  The group  sold 214 GWh  of electricity to the
market in Q2 2024 compared with 139 GWh a year earlier.

In Q2 2024, 246 GWh of the group's electricity production was covered by PPAs at
an  average price of EUR68.0/MWh. A  year earlier, 218 GWh of electricity was sold
under  PPAs at an average  price of EUR83.5/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. The share and prices  of production covered by  PPAs in future periods
are disclosed in the risk management chapter of the attached interim report.

In  Q2 2024, we purchased 108 GWh  of electricity from the  market at an average
price  of EUR80.4/MWh, compared with 97 GWh at an average price of EUR83.8/MWh in Q2
2023 (the  prices  and  volumes  exclude  the  electricity  purchased for pellet
production  in Q2 2023). The volume  of electricity purchased increased slightly
as  sales under PPAs have  increased, but as the  share of production covered by
PPAs  has decreased, the ratio of  electricity purchased to electricity produced
decreased  year  on  year.  The  purchase  price decreased compared to Q2 2023,
because the market price has declined, but due to a higher wind profile discount
the gap between the purchase price and the sales price increased.
In  Lithuania, the Q2  wind profile discount  increased by 4.4 percentage points
year on year, rising to 13%. In Estonia, the solar profile discount increased by
6.3 percentage  points to  30.3%, while the  wind profile  discount decreased by
1.6 percentage  points to 7.9% In  2024, we began 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 Q2 2024 was 26.6%.

Renewable  energy support and other operating income (excl. the effect of assets
sold) increased by EUR0.8m compared to the same period last year. Renewable energy
support  increased by EUR0.7m. The amount  of renewable energy support received is
based on the quantity of energy produced by wind farms eligible for support. The
eligibility period of the Purtse wind farm began in Q2 2024, which increased the
amount of support received by EUR0.2m. The output of other wind farms eligible for
support was 6.4 GWh higher than in Q2 2023.


EBITDA and segmental breakdown

The  factor with  the strongest  impact on  EBITDA development  was the price of
electricity  sold, which decreased compared to Q2 2023 (negative impact: EUR5.4m).
Due  to  PPAs,  the  quantity  of  electricity sold grew significantly (positive
impact:  EUR8.2m), which  also increased  the volume  of electricity  purchased to
balance  the electricity portfolio (negative impact: EUR0.8m). The combined effect
of  the  above  factors  on  EBITDA  is  influenced by the volume and profile of
electricity produced during the period.

The total impact of assets sold on EBITDA development was negative at EUR1.6m. The
figure  consists of a positive impact on  Q2 2023 of EUR0.8m and a negative impact
on  Q2 2024 of EUR0.8m. The latter results from  the correction of the gain on the
sale  of  the  Paide  and  Valga  CHP  plants  recognised  in April. For further
information, see the financial results chapter of the attached interim report.

The EBITDA of the Iru cogeneration plant excluding the effects of the
electricity price and volume decreased by EUR0.3m to EUR4.2m. The calculation takes
into account the effects of heat energy, gate fees for waste received and
technological fuel. The decrease was mainly due to lower energy production
resulting from lower availability, which was partly offset by a rise in the
price cap for heat energy.

Based  on total operating income and EBITDA, the group's largest segment is Wind
energy,  which accounted  for 70% of  operating income  and 80% of EBITDA for Q2
2024. The  Cogeneration segment  contributed 22% to  operating income and 28% to
EBITDA. The smallest reportable segment is Solar energy, which accounted for 8%
the group's operating income and 11% of the group's EBITDA for Q2 2024. The only
reportable segment that delivered EBITDA growth was Wind energy. This growth was
driven   by   significant  growth  in  electricity  generation.  EBITDA  of  the
Cogeneration  segment declined primarily  due to the  assets sold. EBITDA of the
Solar energy segment remained at last year's level. More detailed information is
available in the attached interim report.


Net profit

Net  profit increased by EUR2.8m  to EUR3.9m compared to  the same period last year.
The increase in net profit was mainly driven by a decrease in income tax expense
by EUR4.1m.


Capital Expenditures

The  group invested EUR129.8m in Q2 2024, EUR55.3m  more than in Q2 2023. The growth
was  driven  by  development  investments,  which  amounted to EUR129.6m. Of this,
EUR106.9m  was invested  in the  construction of  three wind  farms: EUR86.6m in the
Sopi-Tootsi  wind farm and EUR20.4m in the Kelm? wind farms (EUR11.6m in Kelm? I and
EUR8.7m  in Kelm? II). The largest development investment in solar energy was made
in   the   Sopi  solar  project  at  EUR7.4m.  Base  investments  remained  at  an
insignificant level of EUR0.2m.


Financing

At  30 June 2024, the amortised cost of the group's interest-bearing liabilities
amounted  to EUR629.0m  (31 March  2024: EUR503.2m). During  the second quarter, the
group  drew down  bank loans  of EUR125m.  In addition,  at the  end of the second
quarter,  the group increased  the amount of  a previously signed loan agreement
with  Swedbank to  EUR100m and  extended the  term of  this loan  until the end of
2028. Investment  loans raised  but not  drawn down  at 30 June 2024 amounted to
EUR235m.  The average interest rate  of bank loans drawn  down at 30 June 2024 was
4.23% (31 March 2024: 3.79%). The net debt/EBITDA ratio stood at 5.52 at the end
of  the quarter  (31 March  2024: 4.39). The increase  in the  ratio is due to a
large number of development projects under construction.


Condensed consolidated interim income statement

 EUR thousand                                Q2 2024  Q2 2023    H1 2024  H1 2023

 Revenue                                    33,875   36,760     90,067  106,451

 Renewable energy support and other
 operating income                            4,377    4,406     17,106   12,219

 Change in inventories of finished goods
 and work in progress                            0    4,892          0    (168)

 Raw materials, consumables and services
 used                                     (13,910) (20,583)   (34,584) (45,375)

 Payroll expenses                          (2,363)  (2,905)    (4,588)  (5,391)

 Depreciation, amortisation and
 impairment                                (9,829)  (9,707)   (19,171) (19,522)

 Other operating expenses                  (3,073)  (3,274)    (6,668)  (7,329)

 OPERATING PROFIT                            9,077    9,589     42,162   40,885

 Finance income                                456    1,191      1,026    1,598

 Finance costs                               (436)    (402)      (742)    (782)

 Net finance income and costs                   20      789        284      816

 Profit (loss) from associates under the
 equity method                                (39)       22       (49)       41

 PROFIT BEFORE TAX                           9,058   10,400     42,397   41,742

 Income tax expense                        (5,117)  (9,260)    (5,010) (10,080)

 PROFIT FOR THE PERIOD                       3,941    1,140     37,387   31,662



 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                 0.015    0.004       0.14     0.12

 Diluted earnings per share, EUR               0.015    0.004       0.14     0.12


Condensed consolidated interim statement of financial position

  EUR thousand                           30 June 2024   31 December 2023

  ASSETS

  Non-current assets

  Property, plant and equipment           1,250,517          1,027,057

  Intangible assets                          59,808             59,891

  Right-of-use assets                         8,651              9,097

  Prepayments for non-current assets         47,477             55,148

  Deferred tax assets                         1,487              2,013

  Investments in associates                     499                548

  Derivative financial instruments            5,772              5,054

  Non-current receivables                     1,026                  0

  Total non-current assets                1,375,237          1,158,808



  Current assets

  Inventories                                 5,425              3,180

  Trade receivables                           6,207              8,618

  Other receivables                           6,970             16,380

  Prepayments                                13,098             30,084

  Derivative financial instruments            4,135              3,806

  Cash and cash equivalents                  39,372             65,677

                                             75,207            127,745

  Assets classified as held for sale              0             15,370

  Total current assets                       75,207            143,115

  Total assets                            1,450,444          1,301,923


 EUR thousand                                       30 June 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                               8,291            5,556

 Other reserves                                        166,296          163,451

 Foreign currency translation reserve                    (103)            (162)

 Retained earnings                                     230,620          223,718

 Total equity                                          729,731          717,190

 LIABILITIES

 Non-current liabilities

 Borrowings                                            532,860          454,272

 Government grants                                       3,139            3,102

 Non-derivative contract liability                      12,412           12,412

 Deferred tax liabilities                               12,442           12,497

 Other non-current liabilities                           5,239            5,239

 Provisions                                                  7                8

 Total non-current liabilities                         566,099          487,530

 Current liabilities

 Borrowings                                             96,100           32,126

 Trade payables                                         32,720           29,464

 Other payables                                         22,916           24,981

 Provisions                                                  2                6

 Non-derivative contract liability                       2,876            5,674

                                                       154,614           92,251

 Liabilities directly associated with assets
 classified as held for sale                                 0            4,952

 Total current liabilities                             154,614           97,203

 Total liabilities                                     720,713          584,733

 Total equity and liabilities                        1,450,444        1,301,923


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 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.