Statkraft falls to EUR-227 loss after wind, hydro impairments

Norwegian state-owned utility Statkraft AS turned to a net loss of NOK 2.04 billion (USD 250m/EUR 227m) in the second quarter (Q2) of 2015, due to wind and hydro impairments and currency effects.

Statkraft said Thursday it has recorded impairment losses amounting to NOK 1.82 billion on wind assets in Sweden and NOK 384 million on hydropower assets in India. The negative bottom line result compares to a profit of NOK 38 million in Q2 2014.

The group’s net underlying revenue rose to NOK 4.81 billion from NOK 4.62 billion a year earlier. Power generation improved to 14.2 TWh from 12.9 TWh.

In the wind segment, the company had to write down wind power plants in Sweden it expects lower power and certificate prices in the coming years. Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) for wind were negative NOK 9 million, versus positive NOK 68 million a year back, mainly due to the deconsolidation of UK wind capacity and lower Nordic power prices. These effects were offset in part by capacity additions in Sweden and increased wind output in Norway.

The net underlying wind revenue fell to NOK 158 million from NOK 233 in Q2 2014. The company invested NOK 497 million in new capacity.

In June, Statkraft’s Board of Directors decided not to invest in the Fosen and Snillfjord onshore wind power projects in Norway, totalling 1 GW, due to lack of profitability. Yet, the company and partners have initiated a study for an alternative onshore wind plan in the same area. It will help assess whether it is possible to obtain profitability.

(NOK 10 = USD 1.223/EUR 1.114)

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