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Italian ERG reports stable 2019 profit despite low hydro

Wind farm in Italy. Source: ERG SpA (www.erg.eu).

March 12 (Renewables Now) - Italian energy company ERG SpA (BIT:ERG), which operates nearly 2 GW of wind parks in Europe, almost doubled its fourth-quarter net profit but still its 2019 bottom-line result shrank by 3% to EUR 104 million (USD 117.5m).

The company registered adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of EUR 504 million in 2019, which rose from EUR 491 million a year back thanks to favourable wind conditions, the contribution of the thermoelectric business and the addition of new power production capacity. The result was, however, negatively impacted by low hydropower reserves due to the dry weather and a weakening of power prices, CEO Luca Bettonte explained.

Adjusted revenues from ordinary operations came at EUR 1.02 billion, more or less at the level of the previous year. More details are available in the table.

Amounts in EUR million Q4 2019 Q4 2018 2019 2018
Revenues 260 261 1,022 1,027
Adjusted EBITDA 124 109 504 491
-- of which wind 87 75 301  274
-- of which solar 7 4 63 32
-- of which hydroelectric 23 28 87 146
Adjusted EBIT 48 38 205 216
Adjusted net profit 29 15 104 107

At end-2019, ERG had 1,929 MW of installed wind, mainly in Italy, 480 MW of thermal power plants, 141 MW of solar and 527 MW of hydropower assets. Its wind farms produced 4,000 GWh of electricity in 2019, up from 3,464 GWh in 2018, while the output of its solar plants increased to 226 GWh from 130 GWh. Hydropower generation witnessed a 29% drop to 1,229 GWh.

The Italian power group continues work on its plan to add 850 MW of capacity between 2017 and 2022. It has so far installed 350 MW. Financially, it expects an EBITDA of EUR 500 million-520 million in 2020 and investments of between EUR 185 million and EUR 215 million that will go for greenfield projects in the UK, Poland and France.

(EUR 1.0 = USD 1.130)

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Veselina Petrova is one of Renewables Now's most experienced green energy writers. For several years she has been keeping track of game-changing events both large and small projects and across the globe.

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