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Costs sink H1 renewables profits for Spain's Ence, EBITDA stays healthy

Forest biomass. Author: Oregon Department of Forestry. License: Creative Commons, Attribution 2.0 Generic.

July 31 (Renewables Now) - The renewable energy business of Spanish group Ence Energia y Celulosa SA (BME:ENC) recorded a 67.9% year-on-year drop in first-half attributable net profit to EUR 1.2 million (USD 1.3m).

Earnings before interest, taxes, depreciation and amortisation (EBITDA) in the renewables segment rose by 30.5% to EUR 25.7 million at the end of the year’s first semester. According to the financial report published on Wednesday, the company’s net finance costs rose by 88.8% year-on-year to EUR 8.9 million.

Ence, whose other business activities include pulp and forestry, saw its half-year revenues in the renewables business rise by 17.5% year-on-year to EUR 80.8 million.

The company operates six biomass-fired power plants in Spain with a combined installed capacity of 170 MW. Since December 2018, it has been running the 50-MW Puertollano concentrated solar power (CSP) plant in the Spanish province of Ciudad Real.

Electricity sales volume increased by 7.8% to 482,580 MWh in the first six months and by 7% to 235,363 MWh in the second quarter, driven by the contribution of the CSP plant.

Revenue figures for each plant are presented in the table below:

Plant location: Capacity: Technology: H1 2019 (in EUR): H1 2018 (in EUR): y/y change in %
Huelva 50 MW biomass 139,829 134,905 3.7
Huelva 41 MW biomass 48,757 73,141 -33.3
Merida 20 MW biomass 68,560 57,046 20.2
Ciudad Real 16 MW biomass 45,909 45,172 1.6
Jaen 16 MW biomass 40,107 45,193 -11.3
Cordoba 27 MW biomass 100,125 92,013 8.8
Ciudad Real 50 MW CSP 39,293 - -
Total revenue in EUR million: 80.8 68.8 17.5

According to Ence, the decline in output at the 41-MW facility in Huelva was due to a temporary halt of operations for repair and repowering.

Ence is currently building two new power plants fired by agricultural and forestry biomass -- a 46-MW facility in Huelva and a 50-MW station in Ciudad Real. Both are planned for commissioning by the end of 2019. The company projects that the new plants will boost annual renewables EBITDA by around EUR 30 million to reach EUR 100 million per year.

(EUR 1.0 = USD 1.12)

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Sladjana has significant experience as a Spain-focused business news reporter and is now diving deeper into the global renewable energy industry. She is the person to seek if you need information about Latin American renewables and the Spanish market.

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