Norway's Scatec swings to Q1 loss amid Ukraine impairments

Norwegian renewable power producer Scatec ASA (OSL:SCATC) turned to a consolidated net loss of NOK 1.1 billion (USD 114.9m/EUR 109.3m) in the first quarter of 2022 after booking close to NOK 1 billion of impairments, mostly related to its solar parks in Ukraine, and cut its full-year EBITDA forecast.

More specifically, the Norwegian firm wrote off NOK 932 million in total in the three months, including NOK 116 million for the discontinued development of projects in Mali, Bangladesh and India and NOK 816 million for assets in Ukraine. The impairments led to a quarterly net loss against a profit of NOK 42 million a year earlier.

“Our first-quarter results were impacted by Russia’s war in Ukraine, the broader geopolitical uncertainty and seasonality in the Philippines,” said CEO Terje Pilskog.

Consolidated earnings before interest, tax, depreciation and amortisation (EBITDA), meanwhile, contracted by 31% year-on-year as lower revenues were brought from joint ventures and associated companies. The result was further burdened by a NOK-98-million loss provision on accounts receivable in Ukraine.

Scatec Solar closed the January-March quarter with consolidated revenues from power sales that were 5% higher than in the year-ago period. The increase was registered mainly thanks to the contribution of the Dam Nai wind farm in Vietnam that the company bought last January. On a proportionate basis, revenues improved further due to the higher power output.

More details are available in the table below.

Due to the military conflict between Russia and Ukraine, Scatec Solar lowered its 2022 guidance for proportional EBITDA to NOK 2.3 billion-2.6 billion from NOK 2.7 billion-3 billion. Power production on a proportionate basis in the year is now seen to range between 3.9 TWh and 4.2 TWh, instead of 3.9 TWh-4.3 TWh previously.

(NOK 1.0 = USD 0.104/EUR 0.099)

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