Enefit Green (EGR1T) Q2 2024 earnings summary

Executive summary

• Q2 2024 electricity production increased 35% year-over-year, driven by new wind and solar assets, though still below forecasts due to lower wind speeds and asset availability; thermal output fell 32% due to asset sales and outages.

• Operating income declined 7% to €38.3m, EBITDA decreased 2% to €18.9m, while net profit surged 246% to €3.9m, reflecting lower electricity prices, asset sales, and lower corporate income tax.

• Major investments continued, with €129.8m invested in Q2, mainly into wind and solar developments; total renewable capacity under construction reached 637 MW.

• CEO transition occurred with the appointment of a new CEO effective October 2024 and ongoing recruitment for a new CFO.

• Loan agreement with Swedbank increased to €100m and extended to 2028 to support ongoing investments.

Financial highlights

• Q2 2024 operating income: €38.3m (-7% YoY); EBITDA: €18.9m (-2% YoY); net profit: €3.9m (+246% YoY).

• H1 2024 operating income: €107.2m; EBITDA: €61.3m (+2%); net profit: €37.4m (+18%).

• Average electricity price earned was €70/MWh in Q2, 22% below last year, with market sales at €52/MWh.

• Q2 earnings per share: €0.015 (vs. €0.004 in Q2 2023).

• Investments in Q2: €129.8m (+74% YoY), mainly in wind and solar projects.

Outlook and guidance

• 2024 electricity production forecast revised slightly downward to just over 2 TWh due to lower wind speeds and asset availability; 62.8% of output hedged with PPAs at €67.2/MWh.

• Market analysts expect electricity prices to remain stable, with a potential 15% rise in 2025–2026.

• Leverage expected to peak in 2025 as major projects complete; net debt/EBITDA at 5.5x as of June 2024.

• Focus remains on completing projects under construction, developing storage and hydrogen technologies, and active PPA management.

• No postponement of tier-one wind projects planned, but market and financing conditions are closely monitored.