Report for the nine months ended 30 September 2024
Orrön Energy reported mixed results for the nine months ended September 2024. The company added 33 GWh of annual power generation through acquisitions in SE3 and SE4 price areas. Power generation reached 620 GWh, approximately 10% below expectations due to lower wind speeds and voluntary production curtailments. Financial highlights include cash flows from investing activities of MEUR 39.5, benefiting from the Leikanger hydropower plant sale. Operating cash flows were MEUR -3.6, with achieved electricity price at EUR 35 per MWh resulting in proportionate EBITDA of MEUR 6.9. The company maintains significant liquidity through a MEUR 170 revolving credit facility, with proportionate net debt at MEUR 55.9.
Orrön Energy ha riportato risultati misti per i nove mesi terminati a settembre 2024. L'azienda ha aggiunto 33 GWh di produzione annuale di energia attraverso acquisizioni nelle aree di prezzo SE3 e SE4. La produzione di energia ha raggiunto i 620 GWh, circa il 10% al di sotto delle aspettative a causa di velocità del vento inferiori e tagli volontari alla produzione. Le principali informazioni finanziarie includono flussi di cassa dalle attività di investimento di MEUR 39.5, beneficiando della vendita della centrale idroelettrica di Leikanger. I flussi di cassa operativi sono stati di MEUR -3.6, con il prezzo dell'elettricità raggiunto a EUR 35 per MWh che ha portato a un EBITDA proporzionale di MEUR 6.9. L'azienda mantiene una liquidità significativa attraverso un credito revolving di MEUR 170, con un debito netto proporzionale di MEUR 55.9.
Orrön Energy reportó resultados mixtos para los nueve meses que finalizaron en septiembre de 2024. La empresa agregó 33 GWh de generación anual de energía a través de adquisiciones en las áreas de precio SE3 y SE4. La generación de energía alcanzó los 620 GWh, aproximadamente un 10% por debajo de las expectativas debido a menores velocidades del viento y recortes voluntarios en la producción. Los aspectos destacados financieros incluyen flujos de efectivo de actividades de inversión de MEUR 39.5, beneficiándose de la venta de la planta hidroeléctrica de Leikanger. Los flujos de efectivo operativos fueron de MEUR -3.6, con un precio de electricidad alcanzado de EUR 35 por MWh, lo que resultó en un EBITDA proporcional de MEUR 6.9. La empresa mantiene una liquidez significativa a través de una línea de crédito rotativa de MEUR 170, con una deuda neta proporcional de MEUR 55.9.
Orrön Energy는 2024년 9월 종료된 9개월 동안 혼합된 결과를 보고했습니다. 이 회사는 SE3 및 SE4 가격 지역에서 인수를 통해 연간 33 GWh의 발전량을 추가했습니다. 발전량은 620 GWh에 도달했으며, 바람 속도 저하와 자발적인 생산 축소로 인해 예상보다 약 10% 낮았습니다. 재무 하이라이트에는 Leikanger 수력 발전소 매각 덕분에 MEUR 39.5의 투자 활동에서 발생한 현금 흐름이 포함됩니다. 운영 현금 흐름은 MEUR -3.6이며, 전기 가격은 MWh당 EUR 35로 달성되어 MEUR 6.9의 비례 EBITDA를 초래했습니다. 이 회사는 MEUR 170의 리볼빙 신용 시설을 통해 상당한 유동성을 유지하고 있으며, 비례 순부채는 MEUR 55.9입니다.
Orrön Energy a rapporté des résultats mitigés pour les neuf mois se terminant en septembre 2024. L'entreprise a ajouté 33 GWh de production annuelle d'énergie grâce à des acquisitions dans les zones de prix SE3 et SE4. La production d'énergie a atteint 620 GWh, soit environ 10 % en dessous des attentes en raison de vitesses de vent inférieures et de réductions volontaires de la production. Les faits saillants financiers incluent des flux de trésorerie provenant d'activités d'investissement de MEUR 39,5, bénéficiant de la vente de la centrale hydroélectrique de Leikanger. Les flux de trésorerie d'exploitation étaient de MEUR -3,6, avec un prix d'électricité atteint de 35 EUR par MWh, entraînant un EBITDA proportionnel de MEUR 6,9. L'entreprise maintient une liquidité significative grâce à une facilité de crédit renouvelable de MEUR 170, avec une dette nette proportionnelle de MEUR 55,9.
Orrön Energy berichtete über gemischte Ergebnisse für die neun Monate bis September 2024. Das Unternehmen hat durch Akquisitionen in den Preisbereichen SE3 und SE4 33 GWh an jährlicher Energieerzeugung hinzugefügt. Die Energieerzeugung erreichte 620 GWh, etwa 10 % unter den Erwartungen aufgrund niedrigerer Windgeschwindigkeiten und freiwilliger Produktionsdrosselungen. Finanzielle Highlights umfassen Cashflows aus Investitionstätigkeiten von MEUR 39,5, begünstigt durch den Verkauf des Wasserkraftwerks Leikanger. Die operativen Cashflows betrugen MEUR -3,6, wobei der erzielte Strompreis bei 35 EUR pro MWh lag und ein proportionaler EBITDA von MEUR 6,9 resultierte. Das Unternehmen hält eine signifikante Liquidität durch eine MEUR 170 revolving credit facility und hat eine proportionale Nettoverschuldung von MEUR 55,9.
- Added 33 GWh of annual power generation capacity through acquisitions
- Strong technical availability of 96% in Q3
- Positive cash flow from investing activities of MEUR 39.5
- Significant liquidity headroom with MEUR 170 revolving credit facility
- Reduced capital expenditure guidance to MEUR 11 for 2024 due to cost savings
- Power generation 10% below expectations at 620 GWh
- Negative operating cash flow of MEUR -3.6
- Q3 proportionate EBITDA declined to MEUR -4.9
- Lower electricity prices impacting financial results
- Proportionate net debt of MEUR 55.9
Highlights
- Added 33 GWh of annual proportionate power generation in the SE3 and SE4 price areas through acquisitions and increased ownership in existing windfarms.
- Power generation amounted to 620 GWh for the reporting period, which was approximately ten percent below expectations, due to lower-than-average wind speeds and voluntary production curtailments during periods of low electricity prices.
- Continued progress on the Company’s greenfield projects, with additional land secured and the first projects in the UK and Germany approaching the ready-to-permit stage.
Consolidated financials – 9 months
- Cash flows from investing activities amounted to MEUR 39.5 and was positively impacted by the sale of the Leikanger hydropower plant in the second quarter.
- Cash flows from operating activities amounted to MEUR -3.6.
Proportionate financials – 9 months
- Achieved electricity price amounted to EUR 35 per MWh, which resulted in a proportionate EBITDA of MEUR 6.9.
- Proportionate net debt of MEUR 55.9, with significant liquidity headroom available through the MEUR 170 revolving credit facility.
Financial Summary
Orrön Energy owns renewables assets directly and through joint ventures and associated companies and is presenting proportionate financials to show the net ownership and related results of these assets. The purpose of the proportionate reporting is to give an enhanced insight into the Company’s operational and financial results.
Expressed in MEUR | 1 Jan 2024- 30 Sep 2024 9 months | 1 Jul 2024- 30 Sep 2024 3 months | 1 Jan 2023- 30 Sep 2023 9 months | 1 Jul 2023- 30 Sep 2023 3 months | 1 Jan 2023- 31 Dec 2023 12 months |
| Consolidated financials | |||||
| Revenue | 18.6 | 1.6 | 19.6 | 2.3 | 28.0 |
| EBITDA | 0.9 | -7.1 | -4.2 | -6.7 | -5.1 |
| Operating profit (EBIT) | -11.2 | -11.3 | -12.6 | -9.4 | -17.0 |
| Net result | -6.7 | -11.1 | -15.6 | -7.8 | -7.6 |
| Earnings per share – EUR | -0.02 | -0.04 | -0.05 | -0.03 | -0.03 |
| Earnings per share diluted – EUR | -0.02 | -0.04 | -0.05 | -0.03 | -0.03 |
| Proportionate financials1 | |||||
| Power generation (GWh) | 620 | 164 | 539 | 161 | 765 |
| Average price achieved per MWh – EUR | 35 | 18 | 49 | 23 | 47 |
| Operating expenses per MWh – EUR | 18 | 21 | 18 | 20 | 18 |
| Revenue | 22.0 | 2.9 | 26.6 | 3.6 | 36.2 |
| EBITDA | 6.9 | -4.9 | 4.0 | -4.3 | 5.3 |
| Operating profit (EBIT) | -8.1 | -10.1 | -7.8 | -8.2 | -11.0 |
1 Proportionate financials represent Orrön Energy’s proportionate ownership (net) of assets and related financial results, including joint ventures. For more details see section Key Financial Data in the report for the interim report for the third quarter.
Comment from Daniel Fitzgerald, CEO of Orrön Energy AB
“The third quarter provided many opportunities for our business, in a period characterised by low and volatile electricity prices. We continued to grow our business through selective acquisitions and consolidation opportunities, and continued to lay the foundation for future growth through our greenfield projects across Europe. However, the third quarter was challenging from a revenue and electricity price perspective, impacting our financial results. In the Nordics this was primarily due to lower-than-expected electricity demand, low gas prices and an oversupply of electricity during peak hours. Despite these challenges, we successfully expanded our asset base through strategic acquisitions of shares and assets across wind farms and companies, delivered in line with our cost guidance and maintained high technical availability across our operational portfolio. Orrön Energy’s balance sheet remains robust and we have ample liquidity to continue to invest in growth while withstanding periods with lower electricity prices, allowing us to capitalise on opportunities when markets are weak.
Proportionate power generation amounted to 620 GWh for the reporting period and was below expectations due to lower-than-average wind speeds and voluntary production curtailments during periods of low electricity prices. I am pleased that we continue to achieve high technical availability across our operational assets, reaching an average of 96 percent in the third quarter, which demonstrates that we have the capacity to produce more if not for the weather conditions and low prices. Lower seasonal demand, coupled with high volatility in the electricity markets, resulted in a higher number of hours with low or negative electricity prices across the Nordics this summer. During these periods, we proactively curtailed production for short periods to avoid uneconomical power generation, returning to full operation once prices strengthened. As we move into winter, we expect to see higher demand which should help to strengthen electricity pricing into the fourth quarter this year and the first quarter next year, as already reflected in the futures price. Based on our power generation year to date, we now expect to produce around 900 GWh in 2024, depending on wind speeds and power prices during the fourth quarter.
The third quarter marks one year since the start of the Sudan trial in the Stockholm District Court, which will conclude in early 2026 with a verdict expected around the summer 2026. My view on this case remains unchanged and, if anything, it has strengthened over the past 12 months, and I expect a complete and unequivocal acquittal of all parties involved, given the baseless nature of the allegations. Once the trial is complete, we will no longer need to fund the ongoing legal costs related to this case which reduces our G&A expenses by around MEUR 7 per annum, leading to higher underlying EBITDA for the Company in the long term.
Strategic Growth
We have been active on the M&A front since the start of the summer, adding 33 GWh of annual power generation in the SE3 and SE4 price areas through increased ownership in various wind farms and companies. These investments strengthen our operational portfolio, and we will continue to seek opportunities to further consolidate ownership in assets that are complementary to our existing portfolio.
On the greenfield front, we continue to make good progress with our growth strategy. Having secured additional land, we are now moving closer to the ready-to-permit phase for our first large-scale projects in both the UK and Germany, where market valuations and demand for such projects remain high. Additionally, we have commissioned our first battery project in Sweden and continue to advance a pipeline of projects across wind, solar and batteries in the Nordics.
Financially Resilient
We remain in a financially robust position, with liquidity headroom exceeding MEUR 110. Proportionate revenues and other income amounted to MEUR 2.9 for the third quarter, which was impacted by low electricity prices, resulting in a proportionate EBITDA of MEUR -4.9 for the third quarter and MEUR 6.9 for the reporting period. Due to cost savings and phasing of investments into 2025, we are revising our capital expenditure guidance to MEUR 11 for 2024.
Looking Ahead
Throughout the remainder of the year, we will intensify our efforts on the greenfield side to reach the ready-to-permit phase for our first large-scale projects, while continuing to explore opportunities to capitalise on the current market conditions. Orrön Energy has a resilient financial position, enabling us to withstand periods of low pricing while still investing in accretive growth opportunities and acquisitions. I expect market conditions to improve as we come into the winter months, and over time, I am convinced that we will see further value creation through the growth in our core business and greenfield projects.
Once again, I thank our shareholders for their continued support and look forward to sharing updates as we continue to grow the business.”
Webcast
Listen to Daniel Fitzgerald, CEO and Espen Hennie, CFO commenting on the report and presenting the latest developments in Orrön Energy and its future growth strategy at a webcast held on 8 August 2024 at 14.00 CEST. The presentation will be followed by a question-and-answer session.
Registration for the webcast presentation is available on the website and the below link:
https://vimeo.com/event/4678321/54544efc16
For further information, please contact:
Robert Eriksson
Director Corporate Affairs and Investor Relations
Tel: +46 701 11 26 15
robert.eriksson@orron.com
Jenny Sandström
Communications Lead
Tel: +41 79 431 63 68
jenny.sandstrom@orron.com
Orrön Energy is an independent, publicly listed (Nasdaq Stockholm: “ORRON”) renewable energy company within the Lundin Group of Companies. Orrön Energy’s core portfolio consists of high quality, cash flow generating assets in the Nordics, coupled with greenfield growth opportunities in the Nordics, the UK, Germany and France. With financial capacity to fund further growth and acquisitions, and backed by a major shareholder, management and Board with a proven track record of investing into, leading and growing highly successful businesses, Orrön Energy is in a unique position to create shareholder value through the energy transition.
Forward-looking statements
Statements in this press release relating to any future status or circumstances, including statements regarding future performance, growth and other trend projections, are forward-looking statements. These statements may generally, but not always, be identified by the use of words such as “anticipate”, “believe”, “expect”, “intend”, “plan”, “seek”, “will”, “would” or similar expressions. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that could occur in the future. There can be no assurance that actual results will not differ materially from those expressed or implied by these forward-looking statements due to several factors, many of which are outside the company’s control. Any forward-looking statements in this press release speak only as of the date on which the statements are made and the company has no obligation (and undertakes no obligation) to update or revise any of them, whether as a result of new information, future events or otherwise.
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