Investing.com -- Shares of Orron Energy AB (STO:ORRON) tumbled 7% following the announcement of its financial results for FY24, which showed a proportionate EBITDA of €7m.
The decline was primarily attributed to lower power prices, although this was partly mitigated by increased generation after acquiring Karskruv wind farm and gains from the sale of the Leikanger hydro power plant.
The company's FY24 achieved power price was €34/MWh, marking a significant decrease of approximately 28% compared to the previous year.
However, there was a slight recovery in the fourth quarter, with power prices rising to €30/MWh from €18/MWh in the third quarter. The improvement in prices came after they hit a low in the first half of the year but began to recover progressively thereafter.
Orron's power generation for FY24 matched its revised guidance from the third quarter, reaching 907GWh. This consistency was mainly due to a record quarterly power generation of 283GWh in the fourth quarter, despite voluntary curtailments during periods of low prices. Notably, FY24 marked the fourth consecutive year of wind speeds being lower than the historical average.
The company's proportionate net debt increased to €65m from €56m in the third quarter, while its revolving credit facility (RCF) stood at €170m, providing liquidity headroom for future capital expenditure investments.
Operationally, Orron advanced its first large-scale projects in the UK, progressing a 1.4GW solar plant with a co-located 500MW battery development to the ready-to-permit stage. The company has started a sales process to explore divestment options for this project and anticipates other projects in the UK and Germany to reach a similar stage in 2025.
Regarding legal matters, Orron noted that the Sudan legal case has reached its midpoint, with expectations for the District Court trial to conclude by the second quarter of 2026.
Barclays (LON:BARC) analysts commented on the results, stating, "As expected, results were impacted by lower power prices in FY24, albeit offset by improved generation and sell down gains from Leikanger hydro power plants."
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