Mytrah Energy swings to profit in H1 as revenue rises

Indian wind and solar provider Mytrah Energy swung to a first half profit and said it anticipates meeting full year expectations due to growth in its operating capacity.

For the six months ended 30 June, the company achieved an underlying pre-tax profit of $2.49m, up from a loss of $2.42m in the corresponding period a year ago. Revenue increased by 52% to $49.66m, supported by capacity additions during the year and better wind resources. Wind speeds were slightly ahead of expectations in first half.

The growth came despite depreciation in the average exchange rate between the Indian rupee and US dollar from 62.75 to 67.28 between June 2015 and June 2016.

Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) rose by 56% to $45.54m with an EBITDA margin of 92%. Cash and bank balances was $32.2m.

For the Indian rupee, revenue increased by 63% and underlying EBITDA increased by 68%.

The company signed a new rupee term loan agreement of 25.8bn, which is about $380m, to refinance senior loans from 22 banks across 543 megawatt of operating wind farms, increasing the credit rating to A. This reduced the interest rate by an average of 140 basis points and extended the average maturity of debt by about three years.

It also secured a direct loan facility of up to $175m from the Asian Development Bank to help fund the growth of new wind and solar projects in Mytrah Energy's pipeline.

Since the end of June, the company signed a definitive agreement with US multinational General Electric (GE) for a $31m investment.

The company also fully repaid the $14.91m mezzanine debt, which was outstanding with PTC India Financial Services and long-term debt sanctions were received for 237 megawatt solar photovoltaic projects.

Mytrah Energy completed construction and commissioned 295 megawatt wind projects during the six months, taking operational capacity to 877.9 megawatt, which is significantly ahead of its initial target.

The company reported that the 87 megawatt assets in construction is on track for the upcoming wind season, taking capacity beyond 1,000 megawatt.

Signed power purchase agreements for 422 MW of solar projects till the end of June and began construction on projects in Telangana in southern India.

Chairman Ravi Kailas, said: "We delivered a good performance in the first half of 2016 and we will continue to focus on further strengthening the business and improving the quality of our asset performance. Maintaining construction momentum of projects under development and maximising the performance of our operational assets are key priorities.

“Looking at the second half, we expect that power generation will continue to reflect the good monsoon season across India as well as a strong asset performance. Overall, we are well placed to meet expectations for the full year."

Shares in Mytrah Energy were up 2.31% to 58.19p at 0831 BST.