15 Nov 2022
Soltec closed the third quarter of the year with revenues of €159m, an increase of €59m compared to the same period last year, an adjusted EBITDA of €14m (+€17m compared to the third quarter of 2021) and a net profit of €15m (€15m higher year-on-year).
For the first nine months of the year, revenues reached €403m, an increase of €216m compared to the same period last year. Adjusted EBITDA also rose to €8.5m and net profit to €4.5m, a significant improvement compared to 2021.
The good results are driven by a strengthened demand, the reduction in global disruptions, with an improvement in logistics conditions at a global level, as well as the impact of the measures taken by the company to mitigate them.
The company maintains its guidance for the end of the 2022 financial year, with a consolidated EBITDA for Soltec Power Holdings of between €15m and €20m. In the Industrial Division, revenues are expected to be in the range from €450m to 550m and the EBITDA margin, from 2% to 3%. In the Project Development Division, Soltec expects to achieve an EBITDA of between €7m and €11m.
Operational and financial strength of the industrial business
The Industrial Division consolidated the trend shown in the second quarter and recorded a strengthened demand with revenues of €158m in the third quarter, and EBITDA margins of 3% thanks to the measures implemented by the company to mitigate the global disruptions that impacted it in previous quarters, as well as the reduction of tensions in the logistics chain.
At the operating level, the industrial division maintains solid operating indicators, with a backlog (signed projects pending execution) of €308m (1,537 MW), which is well diversified geographically in Latin America 51%, North America 26% and Europe 23%.
Regarding the pipeline (projects that have not yet been signed but with a certain degree of probability of success), it stands at €3,669m (25,174 MW), with Europe (46%), Latin America (25%) and North America (15%) as the most relevant markets.
The company reported an accumulated track record of more than 14 GW as of September 2022, having supplied 2.6 GW of solar trackers during the first nine months of the year.
Growth of the pipeline of the Project Development Division
The pipeline of the Project Development Division reached 13.7 GW at different stages of development, with presence in 8 countries: Spain, Italy, Denmark, Romania, Brazil, Colombia, the United States and Mexico.
The development division shows a very positive evolution and a highly balanced exposure of its project pipeline of 46% in Europe and 54% in the Americas.
At the end of the third quarter of the year, the company had 117 MW already in operation corresponding to two projects in Spain and Brazil.
The company has 112.5 MW under construction in Brazil corresponding to the Araxá Project (Minas Gerais, Brazil), which will be connected to the grid shortly and 5 MW under construction in Spain that will be completed in 2023.
Thanks to the strength and balance of the company's pipeline, Soltec has again partially rotated projects from its portfolio during the third quarter, with the closing of an agreement for the joint development of 340 MW of solar photovoltaic projects in Italy with ACEA, thus consolidating its position in the Italian market.
Net financial debt
Soltec reported on 30 September 2022 a gross financial debt of €180m, mainly associated with the revolving credit facility of its Industrial Division and the project debt linked to the assets under construction in Brazil. Net financial debt thus stands at €155m.
A competitive advantage: vertical integration
Last May, Soltec Power Holdings presented its 2022-2025 Business Plan, in which it announced the creation of a new business line specialising in asset management: Soltec Asset Management.
Through this Asset Management Division, the firm expects to obtain an additional revenue stream from the sale of energy that will provide it with recurrence, strength and stability. It will also allow it to differentiate itself from its competitors and maximise the value of its projects, as well as to mitigate existing risks in the value chain through geographic and business diversification.
In the roadmap it published for the coming years, Soltec expects to achieve revenues of between €780m and €840m through its three lines of activity (industrial, project development and asset management). The company also aims to achieve an EBITDA in the range of between €100m to €120m in the period set out in its Strategic Plan.
Soltec expects to achieve this thanks to the synergies among its different divisions and the recurrence and solidity provided by vertical integration, as well as the growth prospects for the solar industry over the next 30 years – mainly due to cost competitiveness and public policies promoting renewable energies.
Soltec | https://soltec.com/