Release Date: November 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- PNE AG (XTER:PNE3, Financial) achieved a 34% increase in total output to EUR210.9 million, marking the highest 9-month number in the company's history.
- The company's power generation portfolio grew from 321 megawatts last year to 412 megawatts by the end of September 2024.
- PNE AG successfully sold its US business and several international projects, contributing to a robust project pipeline of 17.8 gigawatts.
- The service business managed a capacity of more than 2.9 gigawatts, indicating strong operational performance.
- The company anticipates a strong fourth quarter, with expected project sales and milestone payments to improve financial metrics.
Negative Points
- EBITDA decreased by 62% to EUR6.2 million due to high construction activities and delayed commissioning of wind farms.
- Equity declined to EUR155.5 million from EUR208 million at the end of last year, impacting the equity ratio.
- The company faced challenges such as supply bottlenecks, unfavorable weather conditions, and lower power prices.
- There was a significant decrease in EBITDA for the IPP portfolio despite an increase in revenue, attributed to poor wind yields and lower power prices.
- The equity ratio fell to 12.2%, raising concerns about the need for future capital increases to support growth.
Q & A Highlights
Q: Can you provide details on the expected milestone payments and project sales for the final quarter?
A: We are preparing to sell another significant project in Germany, which is underway. Milestone payments may come from the USA, Romania, and Poland, but we are not disclosing specific amounts due to uncertainties. We are optimistic that the fourth quarter will meet our guidance with these sales and payments. - Per Pedersen, Independent Chairman of the Supervisory Board
Q: Will the disposal of German projects affect your target of a 1.5 gigawatt owned portfolio by 2027?
A: While we aim for 1.5 gigawatts, profitability and a bankable balance sheet are more important than reaching exactly 1.5 gigawatts. The target remains to build a substantial IPP portfolio. - Per Pedersen, Independent Chairman of the Supervisory Board
Q: Why are there no projects in Panama at the development stage one and two?
A: We reviewed our pipeline and decided not to proceed with early-stage projects in Panama as they were not profitable enough. - Roland Stander, Chief Operating Officer
Q: Will there be a capital increase soon given the decrease in equity ratio?
A: Not in the next year, possibly in 2026. We are optimistic about reaching our 20% equity ratio goal by year-end. Future growth in the IPP business will require more equity. - Harald Wilbert, Chief Financial Officer
Q: What are the supply bottlenecks causing delays in wind farm commissioning?
A: Challenges include weather conditions and supply chain bottlenecks from OEMs, leading to delayed deliveries and project completions. - Per Pedersen, Independent Chairman of the Supervisory Board
Q: How will the end of the German traffic light coalition impact your business?
A: In the short term, we do not foresee any significant changes to our strategy or business operations in Germany. - Roland Stander, Chief Operating Officer
Q: Is there a shift in strategy towards a balance between growth and profitability?
A: Yes, profitability is prioritized over growth. We will continue to grow the IPP portfolio but with a sharper focus on profitability. - Per Pedersen, Independent Chairman of the Supervisory Board
Q: What is the status of your offshore development business in Vietnam?
A: We are pursuing a project in southern Vietnam with a potential capacity of up to 2 gigawatts. We are in discussions with the Vietnamese government to secure exclusivity for the project. - Per Pedersen, Independent Chairman of the Supervisory Board
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
