Enersense International Plc's Business Review January–March 2023: Revenue increased by 39% – full-year revenue expected to be over 300 MEUR

Enersense International Plc
Business Review Q1 2023, 8 May 2023 at 12:05 p.m.

The figures in brackets refer to the comparison period (the corresponding period of the previous year), unless otherwise stated. All figures and amounts have been rounded off from exact figures, which may result in minor inaccuracies in additions or subtractions.

JANUARY–MARCH 2023

• Revenue was EUR 75.0 (53.8) million, 39.4% year-on-year.
• EBITDA was EUR 0.1 (5.4) million. The EBITDA margin was 0.1 (10.1)%.
• Adjusted EBITDA was EUR 0.4 (5.5) million, or 0.5 (10.2)% of revenue.
• The operating profit was EUR -2.3 (3.2) million. The profit margin -3.1 (6.0)%.
• Undiluted earnings per share were EUR -0.23 (0.11).
• The order backlog stood at EUR 526 (288) million at the end of the review period.
• On 17 January 2023, Enersense announced that it had signed an agreement of around EUR 35 million on the construction of an optical fibre network in Finland with Valoo, a Finnish optical fibre company.
• On 27 February 2023, Enersense's Board of Directors decided on the Group key employee incentive plan.
• On 27 March 2023, Enersense announced that The Boards of Directors of Enersense International Plc and MBÅ Invest Oy have decided to complete the merger of MBÅ Invest with Enersense in accordance with the merger plan signed on 23 September 2022.

Updated guidance for the financial period 2023

In 2023, Enersense’s revenue is expected to be over EUR 300 million and adjusted EBITDA in the range of EUR 12–18 million.

Despite the general economic uncertainty, the market situation in Enersense’s business areas has continued to be good in the beginning of the year and the favourable development is expected to continue. The company's strong order backlog gives a good basis for increasing revenue. We have managed to accelerate the wind power portfolio development and we assume that the same development continues. Profitability will be impacted by the implementation of the new ERP-system as well as on-going investments in developing the offshore wind power business and acceleration of onshore wind power project development. At the end of 2022 the company completed an offering of EUR 26 million convertible bond in order to implement these investments.

Earlier guidance, issued on 27 February 2023:

In 2023, Enersense’s revenue is expected to be in the range of EUR 280–310 million and adjusted EBITDA in the range of EUR 12–18 million.

Enersense’s business environment is estimated to be developing favourably and the revenue is expected to grow. We have managed to accelerate the wind power portfolio development and we assume that the same development continues. Profitability will be impacted by the implementation of the new ERP-system as well as on-going investments in developing the offshore wind power business and acceleration of onshore wind power project development. At the end of 2022 the company completed an offering of EUR 26 million convertible bond in order to implement these investments.

Key figures

President and CEO Jussi Holopainen

"Despite the uncertainties related to the global economy, Enersense had a strong start for the year 2023. Our revenue increased by 39% year-on-year, increasing to EUR 75 (54) million. Our order backlog also continued to grow and is already EUR 526 (288) million. Our EBITDA is typically at its lowest in the first quarter, but the profitability of our core business operations has improved, considering seasonality.

Our adjusted EBITDA was EUR 0.4 million (5.5) in the first quarter. Our investments in the ramp-up of the offshore wind power business and a new ERP system, EUR 2.3 million in total, were the most significant factors burdening EBITDA in the review period. It is also good to keep in mind that the recognition of EUR 8.5 million arising from the Megatuuli acquisition improved EBITDA in the comparison period.

Profitable core business operations lay the foundation for future growth. We will continue our active measures to ensure the profitability of our core business operations while also strengthening our position in our strategic focus areas. During the review period, as part of the integration of acquired entities, the names for Unified Chargers and Megatuuli were changed and they now continue under the common Enersense brand as Enersense Charging and Enersense Wind.

Markets for our strategic focus areas are developing well and for example, activity in the offshore wind power market is increasing, and we are strongly involved in bidding processes. Our high-quality foundation concept is a highly effective and cost-effective solution, particularly for the areas of the Baltic Sea that freeze up in the winter. Our previous customer relationships and good references enable deliveries to major international renewable energy and offshore wind power companies.

The work we have completed is also reflected in our order backlog, which developed favourably during the first quarter. In the first quarter, the Power business area recorded an agreement with Gigawatti Oy on the construction of the infrastructure for 13 power plants in Oosinselkä, in addition to agreements with Fingrid on substation projects worth EUR 20 million, among other contracts. Our onshore wind power projects are also progressing. In our project portfolio, the project including 50 wind power plants in Yli-Olhava in Ii proceeded to the next phase in February, when the regional wind power plan for Yli-Olhava entered into force. The project is being developed in collaboration with Enersense’s French partner Valorem, and the project investment is estimated at EUR 400–500 million. Wind measurements have been carried out for more than two years, and the wind conditions in the area are excellent. When completed, the wind farm is estimated to generate more than 1 TWh of electricity, or around 1.5% of Finland’s total electricity demand. The investment decision in the project is estimated to be made in 2024–2025.

In early 2023, we also announced our first project related to the green hydrogen economy, when we signed an agreement on the delivery of steel structures for reactor modules for a methanation plant to Q Power, a provider of Power-to-X technologies. The agreement is related to the synthetic methane production plant delivered by Q Power to P2X Solutions in Harjavalta. The plant is being built in connection with P2X’s green hydrogen production plant. Through its 16.3% holding in P2X, Enersense is involved in reducing the emissions of heavy transport using hydrogen and synthetic fuels and in enabling energy storage opportunities created by green hydrogen.

In the Connectivity segment, the increase in the demand for fibre-to-the-home (FTTH) construction projects began in late 2022. The trend continued in January, when we signed a four-year agreement on the construction of an FTTH network for Valoo. The total value of the agreement is EUR 35 million. High-speed data connections play a significant role in enabling the constantly growing data transfer capacity required by the energy transition, and Enersense is strongly involved in investing in the reliability, security and sustainability of Finnish data transmission.

For a long time, we have also been involved in projects to synchronise the Baltic countries with the frequency of the European electricity grid. In January, we announced that we had signed an agreement to modernise the power line between the Mustvee and Paide substations in Estonia. The project plays an important role in the synchronisation of the Baltic electricity grids.

We have today updated our outlook for 2023 as regards to the revenue development. Guidance for the EBITDA remains unchanged. Despite the general economic uncertainty, our order backlog has grown to over half a billion euro and based on this we expect the full-year revenue to grow over EUR 300 million.”

This release is a summary of Enersense's Business Review January–March 2023. The complete report is attached to this release as a pdf-file. It is also available on the company's website at www.enersense.com/press-releases/reports-and-presentations/.

ENERSENSE INTERNATIONAL PLC

Tommi Manninen
SVP, Communications and Public Affairs

More information:  

Jussi Holopainen, CEO   
Tel. +358 44 517 4543   
Email: jussi.holopainen@enersense.com

Mikko Jaskari, CFO
Tel.: +358 40 053 5337​
Email: mikko.jaskari@enersense.com​

Media contacts:  
Tommi Manninen, SVP, Communications and Public Affairs   
Tel. +358 40 043 7515   
Email: tommi.manninen@enersense.com

Distribution:
Nasdaq Helsinki
Major media
www.enersense.com

Enersense in brief: 
Enersense International Plc is a creator of zero emission energy solutions and strongly supports the ongoing energy transition and enabling a zero-emission society. Enersense Group’s revenue in 2022 was EUR 268 million. The company has approximately 2,000 employees, with operations in Finland and internationally. Enersense’s shares are listed on Nasdaq Helsinki (ESENSE). The company’s investor pages can be found at www.enersense.com/investors.