Earnings surge at Renewables not enough to prevent Q1 loss for EnBW

Albatros offshore wind park. Image by: Twitter @EnBW.

May 19 (Renewables Now) - The Renewable Energies segment of German electric utility EnBW Energie Baden-Wuerttemberg AG (ETR:EBK) has helped the company improve its first-quarter operating result by 20.5% year-on-year, but still it turned to a net loss for the period.

On Friday, EnBW posted adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of EUR 945 million (USD 1.03bn) compared to EUR 784 million a year back, with the renewables contribution surging by 93.8% to EUR 236.1 million. The company said it is keeping its EBITDA guidance for the full year at EUR 2.75 billion-2.9 billion.

“As a result of our two offshore wind farms Hohe See and Albatros coming into operation, we expect significantly higher earnings in particular in our renewables business,” said CFO Thomas Kusterer. The operation of these offshore wind parks along with better spring wind conditions and higher water levels at run-of-river power plants were the factors that helped drive earnings growth at Renewable Energies in January-March 2020.

Still, EnBW booked a group net loss of EUR 10.4 million for the period, against a profit of EUR 273.8 million a year earlier. It blamed this negative development on a sharp drop in the financial result due to a lower result from the market valuation of securities.

The table below gives more details about the company’s Q1 financial performance, which, it noted, was not impacted by the coronavirus pandemic.

Figures in EUR million Q1 2020 Q1 2019
External revenue 5,411.7 5,908.7
Adjusted EBITDA 944.8 783.9
-- accounted for by Sales 77.9 67.3
-- accounted for by Grids 416.4 428.7
-- accounted for by Renewable Energies 236.1 121.8
-- accounted for by Generation and Trading 262.1 207.1
-- accounted for by Other/Consolidation (loss) (47.7) (41.0)
Adjusted EBIT 625.7 436.9
EBIT 449.4 360.7
Adjusted group net profit 77.6 369.8
Group net profit (loss) (10.4) 273.8

While EnBW expects to eventually face the negative impact of the COVID-19 crisis, it is confident that it will be able to attain its full-year earnings targets “at least at the lower end of the guidance range.”

“Overall, we have a good basis and a stable business model to carry us relatively well through the crisis,” Kusterer stated.

(EUR 1.0 = USD 1.094)

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