Solaria Energía y Medio Ambiente (SLR) Q2 2024 earnings summary

Executive summary

• H1 2024 saw resilient performance despite a weak electricity price environment, with energy generation up 22% and sales down less than 2% year-over-year.

• EBITDA reached €84.34M, down 5% year-over-year, and net profit was €41.64M, down 17%, with results in line with internal estimates.

• Strategic shift towards infrastructure and data centers, including the first 40 MW supply and construction deal, and a 1 GW DCs connection portfolio.

• Expansion into new business areas such as Generia (land ownership), wind/battery projects, and international markets to diversify revenue streams.

• 1.4 GW under construction remains on track, with new authorisations obtained in Spain and international expansion progressing.

Financial highlights

• Total revenues for H1 2024 were €97.8M, down 2% year-over-year, with EBITDA margin at 102%.

• Infra revenue of EUR 12M and asset rotation gain of EUR 11.5M recognized in H1 2024.

• Net profit for H1 2024 was €41.64M, a 17% decrease year-over-year.

• Operating cash flow was strong at €76M, with €112M invested during the period.

• Net financial debt stood at €1,064M, with an average cost of debt at 3.7% and 14-year average residual tenor.

Outlook and guidance

• FY2024 EBITDA guidance is €205–215M, rising to €245–255M in 2025, with strong cash generation expected from data center and infrastructure businesses.

• Expected cash generation of nearly €1 billion over the next four years, with €670–700M visibility in 2024–2025.

• Progressive connection of 1.4 GW under construction over the next 6–10 months, with Catalonia assets connecting in Q4 2024.

• Buyback program considered if share price remains undervalued, funded by new cash inflows and a stronger-than-expected cash position.

• Plans to expand data center capacity to 1,000 MW, with a 200 MW AI data center project underway and international expansion progressing.