Corporate News
 

ENCAVIS grows in turbulent times and increases operating earnings per share by around 4%

Hamburg, 13 November 2023 – Hamburg-based wind and solar park operator Encavis AG, listed on the MDAX of Deutsche Börse AG (Prime Standard; ISIN: DE0006095003; ticker symbol: ECV) remains on its clear growth path also after nine months of the financial year 2023. The production volume exceeds that of the same period of the previous year, although the latter was meteorologically very strong. The increase in production volume from 2,590 gigawatt hours (GWh) to around 2,638 GWh is driven by the new wind and solar farms acquired in the previous year.

The Management Board confirms the guidance for the full year 2023, published in March 2023, as well as the Accelerated Growth Strategy up to 2027.

In the first nine months of the 2023 financial year, the Group generated net revenue of EUR 356.0 million, slightly above the previous year's level of EUR 354.8 million – each after deduction of the amounts due to the systems implemented in some countries to cap electricity prices. Compared to the meteorologically very strong period of the previous year 2022, which was also characterised by very high electricity prices due to the war in Ukraine, electricity revenue has fallen because of a now markedly reduced price level and more normalised weather. This planned development was offset by substantial revenue growth in the Services segment. The first-time consolidation of Stern Energy increases revenue of the segment by a good EUR 36.6 million to around EUR 40.0 million. The price-related decrease in revenue of around EUR 26 million after nine months of 2023 compared to the same period of the previous year in 2022 was offset by the new wind and solar farms and the full consolidation of Stern Energy – at an electricity price that was at the level of expectations but below the level of the previous year 2022. Revenue in the Asset Management segment are below the planned level after nine months as a result of postponements of projects to the fourth quarter of 2023.

“By the end of September, we had already acquired around half of the 600 megawatts (MW) generation capacity planned to be acquired for this year. Never before in our Company’s history have we acquired such a large generation portfolio in the first nine months of a year as we did this year. Today, we are able to acquire projects with significantly improved returns compared to previous years. The currently rising interest rates on the market for financing the new parks are overcompensated by the increased returns,” comments Dr Christoph Husmann, Spokesman of the Management Board and CFO of Encavis AG, the successful first nine months of 2023.

Operating EBITDA*⁾ of EUR 246.1 million being 9% lower than in the previous year (EUR 271.3 million) after the first nine months of the 2023 financial year resulted in an EBITDA margin of 69%, which was reduced by a good seven percentage points. This is due to the inclusion of Stern Energy's services business for the first time in the consolidated figures, which has a lower margin than that of electricity generation from Renewable Energy sources. In the Wind and Solar Park segments, operating EBITDA margins remain at the usual high level of 73% for Wind Farms and around 80% for Solar Parks.

The decline in operating earnings before interest and taxes (operating EBIT*) by around 5% to EUR 158.9 million (previous year: EUR 166.9 million) is mainly due to the significantly normalised electricity prices in the current year compared to the exceptionally high electricity prices in the same period of the previous year as a result of the war in Ukraine. The operating EBIT margin of just under 45% is thus almost on the level of the previous year's exceptionally strong 47%. Overall, Encavis achieved an increased consolidated operating profit after taxes of EUR 88.6 million (previous year: EUR 86.9 million). Despite growth and as a result of significantly lower taxes on income and earnings compared to the exceptionally strong previous year, this resulted in an operating profit per share*) of EUR 0.53 for the first nine months of 2023, which is above the previous year’s level (previous year: EUR 0.51 per share). In these turbulent times, which are reflected in various expense and income line items, the Encavis business model continues to be very robust – with both net revenue and operating earnings per share (EPS) above the exceptionally strong level of the previous year.

Despite the reduced operating cash flow from operating activities after nine months of EUR 183.7 million (previous year: EUR 271.5 million), as of 30 September 2023, the Group again had cash in the amount of EUR 345.0 million available for the Group's further growth (previous year: EUR 348.7 million). The majority of the decline in operating cash flow is due to the decline in wind and solar park revenue of around EUR 26 million due to significantly lower electricity prices (price effect). In addition, provisions or liabilities established in the previous year, including for price caps already announced at the time, which affected EBITDA but did not affect cash flow, also contribute to this difference.

The equity ratio as of 30 September 2023 rises again from 32.9% to 33.8% compared to the half-year figure of 2023. At the end of the year 2022 (equity ratio as of 31 December 2022: 28.1%) the negative valuation effects for the Group's derivative financial instruments used to hedge interest rates and electricity price hedges, recorded in hedge reserves, have partially reversed. In addition, the fully retained profit of 2022 has a positive impact here.

Overall, the Group remains fully on its growth path and is in line with expectations with the financial key figures for the first nine months of 2023. The Management Board confirms the existing guidance for the full year 2023 and expects revenue of just over EUR 460 million, i.e. EUR 440 million after deduction of the electricity price brakes (2022: EUR 487.3 million and EUR 462.5 million after deduction of the electricity price brakes). Operating EBITDA*⁾ is expected to exceed EUR 310 million (2022: EUR 350.0 million). The Group expects an operating EBIT*⁾ of more than EUR 185 million (2022: EUR 198.3 million). For the operating cash flow, the Group expects a value of more than EUR 280 million (2022: EUR 327.2 million) and thus an operating cash flow per share of more than EUR 1.70 (2022: EUR 2.04). Operating earnings per share*⁾ are expected to amount to more than EUR 0.60, slightly exceeding the previous year's figure (2022: EUR 0.60).

*) Explanations and derivation of the adjusted operating profit figures can be found in the Annual Report / Consolidated Financial Statements 2022 of Encavis AG starting on page 16 and on page 33.

The Annual Report / Consolidated Financial Statements 2022 of Encavis AG is available at:

https://www.encavis.com/Dokumente/IR/Finanzberichte/Encavis%20AG/Gesch%C3%A4ftsjahr%202022/20230328-Encavis-Geschaeftsbericht2022-EN.pdf

About ENCAVIS:
The Encavis AG (Prime Standard; ISIN: DE0006095003; ticker symbol: ECV) is a producer of electricity from Renewable Energies listed on the MDAX of Deutsche Börse AG. As one of the leading independent power producers (IPP), ENCAVIS acquires and operates (onshore) wind farms and solar parks in twelve European countries. The plants for sustainable energy production generate stable yields through guaranteed feed-in tariffs (FIT) or long-term power purchase agreements (PPA). The Encavis Group’s total generation capacity currently adds up to more than 3.5 gigawatts (GW), of which more than 2.1 GW belongs to the Encavis AG, which corresponds to a total saving of around 0.8 million tonnes of CO₂ per year stand-alone for the Encavis AG. In addition, the Group currently has around 1 GW of capacity under construction, of which more than 600 MW are own assets.

Within the Encavis Group, Encavis Asset Management AG offers fund services to institutional investors. Another Group member company is Stern Energy S.p.A., based in Parma, Italy, a specialized provider of technical services for the installation, operation, maintenance, revamping and repowering of photovoltaic systems across Europe.

ENCAVIS is a signatory of the UN Global Compact as well as of the UN PRI network. Encavis AG’s environmental, social and governance performance has been awarded by two of the world’s leading ESG rating agencies. MSCI ESG Ratings awarded the corporate ESG performance with their “A” level and ISS ESG with their “Prime” label.

Additional information can be found on www.encavis.com

Contact:
Encavis AG
Jörg Peters
Head of Corporate Communications & Investor Relations
Tel.: +49 40 37 85 62 242
E-mail: joerg.peters@encavis.com
http://www.encavis.com