Greencoat Renewables confident despite lower wind in first half

The AIM-traded company reported net cash generation of €113.6m, compared to €125.5m in the first half of 2023.

That equated to gross dividend cover of 3x, slightly lower than the 3.5x reported previously.

Dividends paid or declared for the period amounted to 3.37 cents per share.

Greencoat said its net asset value per share stood at 112.1 cents, marginally down from 113.2 cents in the prior year.

The aggregate group debt was reported at €1.3bn, representing 51% of the company's gross asset value (GAV).

During the period, the firm secured a new €150m five-year term debt facility, which was used to repay its revolving credit facility.

Demonstrating disciplined capital allocation, operating cash flows funded €33m in debt repayments.

Additionally, a €25m share buyback programme was currently in progress.

The firm highlighted that increasing demand from big tech firms and advancements in artificial intelligence were driving a surge in the clean energy market and power purchase agreements (PPAs).

In line with the trend, Greencoat Renewables signed a 10-year PPA during the period with a leading data centre owner in Ireland.

Proactive revenue management increased the company's contracted revenue between 2024 and 2028 to 77% of total projected revenue, enhancing financial stability.

Post period end, Greencoat completed the acquisition of a 50% stake in the 80MWp South Meath solar farm located in County Meath, Ireland.

That purchase included a 15-year PPA with a leading technology company, further diversifying the company's renewable energy portfolio.

“We are pleased to present another strong set of results for the six-month period ended 30 June, with Greencoat Renewables continuing to benefit from strong cash generation and sector leading dividend cover,” said non-executive chairman Rónán Murphy.

“Disciplined capital allocation has remained a key focus for the board in a period where the Company has continued to deleverage through operating cash flow whilst also initiating a share buyback programme of up to €25m.

“As one of the largest listed owners of European renewables, with a diversified portfolio across six European countries, we have the knowledge and the ability to capitalise on long-term positive trends in the sector.”

Murphy said proactive revenue management had enabled the firm to enter into power purchase agreements with reputable corporates, as it leveraged the increasing demand from ‘Big Tech’ for clean energy.

“The opportunity and investment case for renewables remains strong with operating assets attractively priced in historical terms.

“We are well positioned to take advantage of opportunities as they arise through our on the ground experts and active approach to asset management.

“As such, we are confident and determined to continue to play a leading role in enabling the energy transition while delivering for our shareholders.”

At 1054 BST, shares in Greencoat Renewables were up 3.91% at 0.96p.

Reporting by Josh White for Sharecast.com.