Sales up - positive result eroded by downtime at Teverola

2018 half-year results

(PresseBox) ( Poschiavo, )
Graubünden-based energy company Repower saw another increase in sales in the first half of 2018, posting total operating revenue of more than a billion Swiss francs. The first six months of Repower’s business year were dominated by efforts to refine and develop innovative systems and services for efficient energy use and grid management. The company also saw very gratifying growth in its services for third parties. In the process Repower reached key new milestones in the implementation of its corporate strategy. At CHF 1,053 million, total operating revenue was up 16 per cent on the prior-year period. EBIT came to CHF 9 million francs, and the company posted slightly positive profits. Earnings were eroded by loss of production at the Teverola power plant.

Repower looks forward with confidence, but is also alert to the challenges in what is still a volatile market. The company took further positive steps in terms of developing its areas of strategic focus. For example there was a gratifying increase in orders for services for third parties – a vote of confidence in Repower due undoubtedly in part to the high quality of work it delivers. Added to this there was significant investment in maintaining the company’s own plants and grids, and further efforts to expand the SME segment of the Italian market.

Innovation with Smart Power

In Switzerland Repower has developed a Smart Power solution, which is now being tested with pilot consumers in the Landquart area. The market launch of Smart Power is scheduled for 2019. In addition to being offered to Repower customers, Smart Power will also be made available to other energy utilities in the form of a modular package. Smart Power is based on a new output-based tariff, a smart metering solution and the integration of customers, who are able to optimise their consumption patterns on an ongoing basis.

Tried-and-tested solutions remain successful

Repower is also offering a tool called EASYASSET enabling the efficient management of infrastructure assets, as well as ENERGYSPACE, a trading portal that simplifies processes and increases transparency for large customers. There are healthy orders for services launched in the Italian market.

Electric mobility headed for growth

Repower’s electric mobility offerings are generating growing interest both in Switzerland and Italy. The PLUG’N ROLL charging network is being further extended in Switzerland in partnership with companies including EKZ, Swiss Prime Site AG, the Thurau Raststätten motorway services group and the Rhaetian Railway. Not only this, but Repower also recently unveiled a new PLUG’N ROLL-website, a new app, and new state-of-the-art charging points.

CEO Kurt Bobst: “The sustained uptrend and a growing number of utility customers demonstrate that Repower’s wealth of experience and the high quality it delivers in its various areas of competence is paying off. Repower is one of the most innovative operators in the energy business, both in Italy and in Switzerland. In both our key markets we’re using our product ranges to position ourselves as a partner to our customers, offering them bespoke solutions along the whole value chain. I’m convinced that our strategy will continue to yield noteworthy, lasting successes in the future in an increasingly volatile environment. ”

Good balance sheet and debt figures

Repower closed the first half of 2018 with operating income (EBIT) of CHF 9 million. As anticipated, this figure is down on last year’s performance (a decline of 55% versus the prior year). Total operating revenues were up 16% to CHF 1,053 million on CHF 15 million in cash flow from operating activities. Profits for the first six months were slightly positive. Technical defects discovered in the scheduled overhaul of the Teverola plant, which resulted in protracted downtime, had a negative impact on results for the first half of 2018. With shareholders’ equity of CHF 768 million, the equity ratio is running at a very solid 43%. Repower’s debt numbers are also very good. As of 30 June 2018 the group posted net liquidity, all interest-bearing financial liabilities were covered by assets, and there was a renewed reduction in net debt.

There was a slight increase in the number of people employed by the group: 575 (6 more than in the prior-year period) in FTE terms. Added to this are 30 apprentices in Switzerland and around 600 sales consultants in Italy.

CEO Kurt Bobst comments on the results as follows: “Despite the unexpected loss of production at Teverola we can report positive interim results. This is a satisfactory result, especially considering the constantly changing market conditions.”

Outlook

Repower anticipates sustained pressure on margins in the electricity business, and expects the CHF/EUR exchange rate to have a substantial impact on results for the whole year as well. However, the company has a solid capital base, and in the past has set the right strategic course to be able to hold its own in the marketplace. Accordingly, Repower anticipates annual results in line with the trend for the first six months.

Notes:
• The 2018 semiannual report is available in online form at onlinereport.repower.com
• At www.repower.com/investors documentation containing additional information on the 2018 semi-annual results can also be found
• Analysts and representatives of the media have been invited separately to a telephone conference
• Images for the PLUG’N ROLL offering are available for download on Repower’s website at www.repower.com/galleries
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