Enefit Green (EGR1T) Q1 2025 earnings summary

Executive summary

• Electricity production rose 25% year-over-year to 617 GWh, mainly from new wind and solar parks in Lithuania and Latvia, nearly doubling installed capacity since Q1 2022, while heat production fell 19% due to asset sales.

• Operating income was €66.9m (-3%), EBITDA €31.0m (-27%), and net profit €21.7m (-35%) compared to Q1 2024, impacted by a 33% drop in captured electricity prices and higher purchase costs.

• New wind and solar assets contributed significantly to production, but deeper wind discounts and lower PPA prices pressured margins.

• Major strategic moves included a partnership with Sumitomo Corporation for offshore wind and a voluntary takeover bid by Eesti Energia, with management proposing no dividend for 2024.

Financial highlights

• Revenue rose to €62.4m (+11%), but renewable energy support and other operating income fell sharply, and overall operating income declined due to lower prices and asset sales.

• Average implied captured electricity price dropped to €54.5/MWh from €81.4/MWh year-over-year.

• EBITDA margin contracted as operating expenses (excluding D&A) rose 35% year-over-year.

• Investments in Q1 2025 totaled €37.7m, down 64% year-over-year, reflecting the current phase of project development.

• Cash flow from operations was €25.8m, with a net cash outflow of €8.5m for the quarter.

Outlook and guidance

• Focus remains on high-return wind and hybrid projects in the Baltics and Poland, with 132 MW under construction and Kelmė I and Latvian PV parks expected to contribute positively in upcoming quarters.

• Strzałkowo solar park in Poland to boost production and revenues from next summer, with 75% output under a 15-year CfD.

• Estimated total investment capacity for pipeline projects is approximately €200 million, with €100m required to complete projects under construction.

• Long-term PPAs and indexed CfDs are expected to provide revenue stability amid market volatility, with 50.8% of 2025-2028 expected production covered by PPAs.

• Integration with Eesti Energia aims to create a more competitive, integrated energy group.