Release Date: February 26, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Ignitis Group AB (STU:IGV0, Financial) achieved a record high adjusted EBITDA of EUR527.9 million in 2024, representing an 8.9% year-over-year increase.
- The company expanded its green capacities portfolio by 0.8 gigawatts, reaching a total of 8 gigawatts.
- Despite heavy investments, Ignitis Group AB (STU:IGV0) maintained a strong balance sheet with a net debt to adjusted EBITDA ratio of 3.05 times.
- The company plans to distribute a dividend of EUR1.33 per share, a 3.1% increase over the previous year.
- S&P reaffirmed Ignitis Group AB (STU:IGV0)'s BBB+ credit rating with a stable outlook, reflecting its solid investment grade status.
Negative Points
- The Customers & Solutions segment experienced a significant decline in EBITDA, driven by lower B2B natural gas supply results and ongoing losses in B2C electricity supply.
- The Curonian Nord project faces potential delays due to challenges in securing long-term power offtake and financing difficulties.
- The Silesia II wind farm in Poland is expected to reach full operational capacity later than initially planned, now anticipated in H2 2025.
- The company's free cash flow was negative at minus EUR193.9 million, primarily due to investments exceeding EBITDA.
- Scope 1 greenhouse gas emissions increased by 14.8% due to higher energy production, despite reductions in Scope 2 and Scope 3 emissions.
Q & A Highlights
Q: Can you highlight more about Customers & Solutions significantly worse results? Should this continue in 2025?
A: The decline in Customers & Solutions is due to normalized natural gas results and loss-making B2C electricity, partly due to prosumer's negative effect under the current net metering scheme. For 2025, we expect lower EBITDA mainly due to prosumer impact and expiring higher price purchase contracts. - Darius Maikstenas, CEO
Q: Do you see the Baltic state synchronization project as a positive or negative indicator for Ignitis' future financial results?
A: Synchronization is a positive development as it brings additional ancillary services to the market, benefiting flexibility investments like batteries. - Darius Maikstenas, CEO
Q: Silesia I produced less than expected compared to Pomerania. Is Silesia I producing at full scale?
A: Silesia I has a lower capacity factor due to its geographic location and is still in its first year of operations, affecting availability. These factors explain the production difference. - Darius Maikstenas, CEO
Q: Are all turbines in Kelme I and Kelme II projects producing?
A: Not all turbines are producing yet as both projects are still in the testing period and have not reached COD. - Darius Maikstenas, CEO
Q: What challenges and financial difficulties may delay the Curonian Nord project COD?
A: Delays in electrolysis projects and related financing difficulties are the main challenges that could delay the project COD. - Darius Maikstenas, CEO
Q: When should we expect the first electricity production in Latvia solar parks?
A: The Stelpe and Varme projects are expected to reach COD this year, with the majority of solar generation coming in 2026. - Darius Maikstenas, CEO
Q: Do you anticipate getting state support subsidy for the BESS project?
A: We are exploring Lithuanian tenders for BESS and support schemes in other markets. - Darius Maikstenas, CEO
Q: What are the key risks that could delay your adjusted EBITDA guidance?
A: The main risks are captured power prices and generation volumes in green capacities and reserve capacity segments. We are managing these risks with high hedging levels and proper maintenance. - Darius Maikstenas, CEO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
