The soaring stock and better-than-expected results in 2018 led Falck Renewables, the company of the historic Falck group which today produces 100% green energy (above all from wind and solar), to revise its plan upwards to 2021. From November 2016 to today, the share listed on the Piazza Affari has in fact completed a rally of +230%, with a return for shareholders of +251% and volumes up by 70%.
The performance is the result of financial results above the targets of the previous plan: in 2018 Ebitda rose to 184 million, up 23% on 2017 and 2,2% on the guidance communicated with the nine-month results; profits almost double from 20 to 34 million. This will first lead to a consistent update of the dividend policy, whose payout ratio is set at 40% of net profits: the dividend for shareholders will thus grow by 41% (7% CAGR) from €0,49 per share in 2016 to €0,69 in 2021, and will already be more higher than expected for both 2018 (0,63 vs. 0,58 initially forecast) and 2019 (0,65 vs. 0,63 forecast).
The targets for 2021 are also revised upwards as regards Ebitda (+55%) and net profit (+33% compared to the previous plan, but the growth also concerns the industrial side, with capital destined for asset development and services which almost doubled in the period 2018-2021 and the installed MW capacity in further progress of 4% compared to the previous plan and of 74% since 2016. In fact, the roadmap envisages the achievement of 1430 MW produced from renewable sources, with various operations already completed in the calendar year: 20,5 MW of photovoltaic plants already operational in the USA (Massachusets), 56 MW of wind just acquired in France (37 million euro deal) and another 10 MW of wind power in Spain ready to be built.
“We are proud – commented the CEO of Falck Renewables at the press conference in Milan, Tony Fox – to present our updated Business Plan, on the basis of a remarkable 2018 that exceeded our expectations – as, indeed, already happened in 2017 – both in terms of execution and in terms of economic and financial results. On the basis of the geographical and business diversification achieved in the last two years, we propose more ambitious targets combined with reconfirmed financial solidity and greater attention to balancing the allocation of capital”.
ROADMAP 2021 – UPDATE OF ECONOMIC AND FINANCIAL TARGETS
The updated Business Plan therefore highlights a strong improvement in the targets compared to those of the previous plan, in particular at Group Net Result level with a further improvement in the Net Financial Position despite the expected increase in capex.
In detail, the update provides:
– Consolidated EBITDA in 2021 of 213 million euros, an improvement of 2,4% compared to the plan presented last year, and an average annual growth of 5% in the period 2018-2021. The Group believes it can achieve this goal thanks to i) the increase in installed capacity through asset development activities, ii) a strong focus on Energy Management and Energy Efficiency services thanks to greater visibility and the support given by the recent acquisition of Energy Team and iii) internal improvements in operational efficiencies and production growth, managed by Vector Cuatro.
– Consolidated Net Result of the Group (after the result attributable to third parties) in 2021 expected to exceed 40 million euros (compared to the over 30 million euros of the plan presented last year), mainly thanks to the contribution that comes from proprietary assets , by the growth of other activities (services and asset development) and by financial efficiency which will allow for the progressive reduction of financial charges.
– Cumulative investments 2019-2021 of 506 million euros, compared to 408 million euros in the previous plan. Investments will mainly be allocated to the growth of assets, while a growing portion will be invested in services (Energy Management, Energy Efficiency and Asset Management). Falck Renewables will also invest heavily in digitalisation, quadrupling the investment envisaged in the previous plan.
– The consolidated Net Financial Position at 2021 will decrease from the 813 million euros expected in the business plan presented last year to the 804 million euros expected in the current plan. The Group expects to improve its consolidated NFP/EBITDA ratio to 2021 from 3,9x, in the plan presented last year, to 3,8x in the current plan. The Group believes it can maintain a consolidated Debt/Equity ratio of approximately 1,3x in 2021 (compared to 1,5x under the previous plan).
