Hexicon (HEXI) Q4 2024 earnings summary

Executive summary

• The floating offshore wind industry faces deployment delays, with commercial-scale projects now expected around 2030, but long-term forecasts remain robust, especially in Europe and Asia.

• 2024 was challenging for renewables due to high interest rates, rising costs, and cautious investor sentiment, impacting offshore wind.

• Hexicon became sole owner of the MunmuBaram project in South Korea after regulatory approval and signed a Transmission Service Agreement with KEPCO.

• Project portfolio size decreased due to Swedish government rejection of two projects and cancellation of an early-stage Korean project, but remaining assets are more mature and valuable.

• Ongoing cost control measures and resource reductions, with a focus on core projects and divestment to improve financial stability.

Significant events and developments

• MunmuBaram project in South Korea secured a transmission service agreement, enabling grid connection, and achieved 100% ownership after regulatory approval.

• Swedish government rejected two Baltic Sea projects, reducing portfolio capacity.

• Extension of credit facility with lenders, including Wallenius, to June 2025, with new security and warrant program.

• Termination of Vestas supplier agreement led to a significant write-down in MunmuBaram.

• Approval of Natura 2000 permit for Mareld site in Sweden, advancing project milestones.

Segment performance

• South Korea: MunmuBaram project advanced, but political instability delays divestment and new partnerships.

• Sweden: Two projects rejected, but Mareld site progressing with permit approvals.

• Italy: Four projects and three prospects active, with two prioritized projects mid-way through environmental assessment.

• UK: TwinHub and Pentland projects progressing, with focus on upcoming CfD auction rounds.

• South Africa: Early-stage development continues with low spend, leveraging strong wind resources and market need.