Norwegian renewable power developer Scatec has published its latest financial results, which include record revenues of NOK2.97 billion (US$270 million) in the third quarter of 2024, driven by a number of asset sales.
The company’s revenues are a significant quarter-on-quarter increase, up from NOK1.28 billion (US$120 million) in the first quarter of this year and NOK1.17 billion (US$110 million) in the second quarter. The company’s results note that no profit was made from the sale of assets in the first and second quarters of this year, compared to a significant profit of NOK1.49 billion (US$140 million) made in the third quarter.
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In the third quarter, Scatec divested from solar plants that were funded as part of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) programme in South Africa, selling projects from the first two bidding rounds to South African asset manager STANLIB. The company also sold hydropower and wind assets, as it looks to raise as much as NOK4 billion (US$360 million) through divestments to support expansions of solar and storage projects in South Africa, Egypt, Brazil and the Philippines, such as a 1GW solar-plus-storage project currently under development in Egypt.
“We are very pleased to continue to deliver on our divestment plan with the announcement of three new transactions during the quarter,” said Scatec CEO Terje Pilskog. “These transactions will increase our financial flexibility through substantial divestment proceeds, enabling re-investment of capital into new attractive renewable energy projects.”
This approach helped drive the company’s profit in the third quarter to NOK1.65 billion (US$150 million), up from losses of NOK26 million (US$2.36 million) and NOK33 million (US$2.99 million) in the first and second quarters of the year, respectively.
Among the company’s remaining operating assets, it also saw significant improvement in the production of electricity at its South African and Jordanian facilities, as shown in the graph above. While the company’s hydropower facilities remained the most productive in terms of raw electricity generation – its Philippines and Laos facilities generated 305GWh and 174GWh of electricity in the quarter, more than any other national sub-sector – its solar facilities contributed to a portfolio that generated more than 1TWh of electricity in the quarter, the first time the company has reached such a milestone this year.
Scatec’s total electricity generation of 1,254GWh in the third quarter is a notable increase over the 995GWh of electricity produced in the second quarter, and the 901GWh of electricity produced in the first quarter, of this year. This is the first time the company has reached this milestone since the third quarter of 2023, when its projects produced 1,047GWh of electricity.
Looking ahead, Scatec expects its full-year proportionate earnings before inflation, taxation, depreciation and amortisation (EBITDA) to reach between NOK4.15 billion (US$380 million) and NOK4.35 billion (US$390 million), an increase of NOK350 million (US$31.72 million) on earlier forecasts. The company also expects the gross margins of its development and construction business to increase to 10-12%, from earlier forecasts of 8-10%.
However, Scatec noted that it has reduced down its full-year proportionate power production by 50GWh to a range of 4.2TWh to 4.3TWh. The combination of lower expectations for power production, but higher expectations for construction profits and overall financial performance, reflects the company’s current emphasis on divesting from assets, before reinvesting this money into new project construction and expansion.
