German wind project developer Energiekontor AG (ETR:EKT) has halved its group earnings before tax in 2017 and is prepared for an even weaker result this year mainly due to the new onshore wind auctioning procedure at home.
The company posted on Thursday group earnings before tax of EUR 16.7 million (USD 20.7m) for 2017 compared to EUR 35.5 million a year back. Net profit at the level of the AG fell to EUR 15.5 million from EUR 28.7 million, while consolidated net profit went down to EUR 11.9 million from EUR 25.3 million. The group’s total output though increased to EUR 202.1 million from EUR 166.7 million.
Energiekontor said that its earnings for the year are in line with expectations. CEO Peter Szabo attributed the decline to the company’s choice to retain half of all wind farms developed throughout the year.
“Group-owned plants continuously generate profits over the years. Energiekontor prefers this strategy of sustainable growth, which also safeguards the business for the long term, to short-term profit-taking,” Szabo commented, adding that the company will follow this strategy in the coming years.
In 2017 the group commissioned 10 projects and sold three wind parks along with three single turbines to investors. Its pipeline of wind and solar projects is now close to 3,000 MW, and in the western part of Texas alone Energiekontor has secured sites for solar projects with a combined capacity exceeding 600 MW.
The CEO also commented on the new auctioning procedure in Germany, saying that its introduction in 2017 resulted in some competitive distortion and undesirable effects.
“Energiekontor and many other project developers were forced to fundamentally change the planning and permission of projects already approved to be able to profitably realise these projects on the basis of the massively lower feed-in tariffs. Accordingly, many of the projects planned in 2018 are experiencing unplanned delays,” Szabo said.
Because of the transitional nature of 2018, group EBT might fall short of the prior year's figure, he added. The company though should return to its previous growth path in 2019.
(EUR 1.0 = USD 1.237)
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