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Germany

Germany

Innogy's grid business drives earnings

GERMANY: Innogy generated less power from renewable sources in the first nine months of the year, while its earnings rose, the developer stated in its third quarter results.

Innogy saw its 352.8MW Galloper site (above) in the UK North Sea produce first power in October
Innogy saw its 352.8MW Galloper site (above) in the UK North Sea produce first power in October

The company’s renewable energy projects produced 6.9TWh between January and September — a 10.4% drop in output year-on-year.

But due to new customers and "supplying more electricity" it sold 193.1TWh of power in the first nine months of 2017 — 8.1% more than in the same period last year.

Innogy’s adjusted earnings before interests, taxation, depreciation and amortisation (EBITDA) totalled €3.1 billion, up 5.3% year-on-year, while its external revenue of €30.79 billion represented a 2.1% fall on the same period last year.

The company described its grid business as the "main driver" behind its growth in earnings.

The commissioning of new onshore wind farms also had a "positive effect" on the company’s finances, Innogy added.

Bernhard Günther, Innogy’s chief financial officer said: "We have set ourselves ambitious goals with our growth strategy, and we are pulling out all the stops to secure and expand our competitive position."

Innogy won a tender for the 860MW Triton Knoll project in the UK’s second contract for difference (CfD) round in September, while its 352.8MW Galloper site in the UK North Sea first produced power in October.

The company also issued its first senior bond, with a volume of €750 million in April, and then a green bond worth €850 million to refinance five wind projects in October.

Innogy said it would use the capital raised through the ten-year green bond to restructure the finance arrangement of the four offshore projects in the UK and Germany and one Dutch onshore site.

Günther described the bond issued in April as "an important step on the way to financial independence for Innogy" following the renewables unit being separated from RWE in April 2016.

Utility

Innogy plans to merge its UK utility subsidiary, npower, with Scottish rival SSE. The merger would create a company roughly the size of UK market leader British Gas.

Günther added: "We are also making good progress in the UK. Despite the difficult situation on the UK market, npower is a strong part of the planned combined retail company with SSE."

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