ERG (ERG) Q2 2024 earnings summary

Executive summary

• Adjusted EBITDA for H1 2024 reached EUR 281 million, up 4% year-over-year, driven by increased installed capacity, new projects, and full consolidation of the U.S. portfolio from April 1.

• Adjusted net profit for H1 2024 was EUR 106 million, down 7–8% YoY, impacted by higher depreciation, financial charges, and a higher tax rate after the cancellation of fiscal benefits in Italy.

• Major expansion into the U.S. market via acquisition and partnership, consolidating 317 MW of wind and solar assets from April 2024.

• Issued a EUR 500 million Green Bond, extending average debt duration to over 5 years and supporting the 2024–2026 Business Plan.

• Fitch affirmed BBB- rating with a stable outlook; MSCI confirmed AAA ESG rating.

Financial highlights

• Q2 2024 EBITDA was EUR 116 million, up 8–9% YoY, mainly from new asset contributions.

• H1 2024 adjusted revenue: EUR 386 million (+4% YoY); Q2 2024 adjusted revenue: EUR 168 million (+7% YoY).

• H1 2024 capital expenditure totaled EUR 444 million, up 43% YoY, mainly for M&A in the U.S. and France and Italian repowering.

• Net financial position at June 30, 2024, was EUR 1.9 billion, up from end-2023, reflecting investments, buyback, and dividends.

• Q2 2024 adjusted net profit was EUR 28 million, down from EUR 36 million YoY.

Outlook and guidance

• 2024 guidance confirmed: full-year EBITDA EUR 520–580 million, CapEx EUR 550–600 million, year-end net financial position EUR 1.75–1.85 billion.

• Guidance unchanged despite a EUR 35 million cash out for substitute tax to free up goodwill, expected to yield EUR 13 million/year in tax savings over five years.

• Significant new capacity (600 MW, +18% vs. end-2023) to be fully contributing from 2025.

• Italian wind and solar EBITDA expected to increase in 2024 due to incentives and new capacity, offset by lower market prices.

• International wind EBITDA expected to decrease due to lower prices, partially offset by new U.S. and France assets; solar EBITDA abroad to remain stable.