Encavis AG, the German wind and solar farm operator, reported a notable decrease in preliminary key performance indicators (KPIs) for the first quarter of 2024 compared to the same period last year. Despite this decline, the company emphasized that the figures remained close to the planned level and reiterated its guidance for the financial year.
Net revenues for the quarter amounted to approximately EUR 86.6 million (USD 93.3m), marking a decrease of more than 12% from the first quarter of 2023. This decline was attributed to factors such as a positive one-off effect in the previous year, improved weather conditions, and higher electricity prices. Christoph Husmann, the CFO of Encavis, highlighted that average electricity prices fell by around 11% across the entire generation portfolio during the first trimester of 2024.
Husmann noted, “There were large differences between regions. In Spain, prices fell by more than a third compared with the same period of the previous year. Nevertheless, revenues are approximately at the planned level, as we had taken into account a decrease in electricity prices and the almost complete hedging of our planned revenues by means of subsidy tariffs or Power Purchase Agreements is taking effect.”
Adjusted EBITDA experienced a decline of over 24% year-on-year to approximately EUR 48.5 million, while adjusted EBIT stood at around EUR 18.2 million, plummeting by more than 48%. The first quarter concluded with adjusted earnings per share of negative EUR 0.04, compared to EUR 0.09 in the corresponding period of the previous year.
Operating cash flow also saw a decrease of around 30% to approximately EUR 36.3 million. Husmann explained, “Such a fluctuation in key figures in the first quarter of the fiscal year is not unusual for a company like Encavis, which is dominated by solar capacity, given that we have very low solar radiation in the first quarter and therefore low production and sales, but the expense is fixed.”
Despite the challenges, Encavis remains optimistic about its prospects for the year. The company expects further sales growth in its Italian solar operations and maintenance business, Stern Energy, along with expanded wind capacity in Germany and increased sales at Encavis Asset Management to compensate for the decline in electricity prices.
Encavis confirmed its guidance for the current year, anticipating a slight increase in operating revenue and operating EBITDA compared to 2023. Total operating revenue is projected to exceed EUR 460 million, with operating EBITDA slightly surpassing EUR 300 million.
