Wind turbines: Is the energy consumption ready for new growth after course correction? (Photo: Freepik)
Energiekontor has gained a lot of experience in the area of renewable energies for over 30 years and is one of the pioneers in the industry. Today the company is one of the leading German project developers and operators of wind and solar parks. When the “sustainability” investor trend was in demand, the Energy Kontor share achieved despite the high profits Course-profit ratio (KGV) of 37.
The share price increased by 350 percent from early 2020 to summer 2022. The result was a clear correction. The course fell from 95 euros to around 55 euros. Is an anti -cyclical start now before growth picks up speed again?
The way to 160 wind and solar parks within 30 years
The Energiekontor AG was founded in 1990 by Bodo Wilkens and Günter Lammers in Bremerhaven. Today they work as chairwoman of the supervisory board and each hold 25.5 percent of the company shares. The Free Float is only 43.9 percent. The company is managed by Peter Szambo.
Since the first wind farms in 1994, Energiekontor has implemented a total of 160 wind and solar parks in Germany, Great Britain, Portugal, France and in the USA over the past 30 years. The total output of the projects is 1.4 gigawatts, which corresponds to an investment volume of around 2.1 billion euros. Around 40 wind and solar parks are in the company’s own stock.
Energy account as a projector, site manager and operator
Energy account is active as a projector, site manager and operator. In some cases, the company has the clear intention of selling the entire energy park before the project starts and only taking over the project execution. In other cases, Energiekontor also acts as an operator. This takes off from the competition, increases the liquidity and thus also the further investment opportunities, which in turn should win more and lead higher returns.
Positive outlook – new records in prospect
After the record year 2023, Energiekontor had to accept a decline in the result in 2024. The wind and solar park developer and operator had already forecast a significant decline in sales and profits at the beginning of 2024. The reasons for this were the difficult market situation, long delivery times for systems and components as well as limited access to wind turbines, which delayed the completion and commissioning of new projects.
Many of the projects currently under construction are to be completed in 2025 and 2026, which significantly strengthens the potential for results for the coming years. In 2024 alone, Energiekontor received building permits for wind farms with a total capacity of over 220 megawatts. This includes 3 large projects in Scotland and a smaller one in Germany.
These permits expand the existing project pipeline, which now amounts to 1,100 megawatts. Despite the challenging year 2024, Energiekontor maintains its goals: by 2028, the profit is to increase before interest and taxes (EBIT) to 120 million euros, whereby EBIT is expected to recover around 105 million euros, the level of 2023.
Financing measures new projects with corporate bond
To finance new projects, Energiekontor has recently successfully placed a company bond over 20 million euros with a term by 2032 and a cupon of 5.25 percent. Since 2021, the company has emitted a total of 4 bonds with a total value of 70 million euros. With these measures, Energiekontor provides itself with sufficient capital for upcoming projects without watering down the shareholders by issuing new shares.
The high demand for the Bonds reflects the trust of many investors in the creditworthiness of Energiekontor. The increased debt harbors risks, especially in times of rising interest rates. However, it is crucial that the forecast cash flows from the projects are sufficient to cover interest costs.
Cheap courses are used for stock returns
Instead of watering down the shareholders, Energiekontor is currently using the share of the share. Since June 2024, more than 34,000 shares have been bought back for around 1.7 million euros at an average price of 52 euros. Despite the weak financial year 2024, which led to a significant increase in the KGV, investors expect a significantly more attractive assessment in 2025.
The backlog of projects is to be dismantled, which could reduce the KGV to a historical low of 10. It is also expected that the Capital yield (Roic) rises to 19 percent again. Only in the debt should be careful with the debt, since the degree of net duty continues to increase and in 2025 it is expected to be 2.5. Nevertheless, analysts are optimistic and see the price target at up to 135 euros, which means a potential of around 150 percent.
Disclaimer:
No investment advice. No call to buy or sell securities.