The Infigen Energy Ltd (ASX: IFN) share price is fluctuating today following the release of the renewable energy company's half-year FY20 results.
After trading as much as 4.1% higher this morning, Infigen shares are now down 1.37% to $0.72 at the time of writing.
What did Infigen Energy report?
Infigen Energy reported that Renewable Energy Generation sold 1,071 gigawatt hours (GWh) during the half-year period. This was up 17% compared to the amount it sold during the prior corresponding period (pcp) of H119.
The company's net revenue also grew strongly to reach $134.3 million, up by 13% on the pcp, while contracted revenue saw an even larger increase of 23% to come in at $116.3 million.
Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) for Infigen Energy was $98.2 million, up 11% on the pcp. Meanwhile, net profit after tax (NPAT) came in at $26.2 million, a 24% increase on the pcp.
The company declared a 1H20 distribution of 1 cent per security which will be paid on 27 March 2020.
Strategic delivery update
During the period, Infigen Energy increased its electricity contracting which provided for higher levels of revenue reliability and continued improvement in the quality of earnings. This was made possible due to the addition of physical firming plant.
Infigen Energy pointed out that the first half of FY20 reflected the first full reporting period which included the company's ownership of Smithfield Open Cycle Gas Turbine plant. This newly acquired asset was reported to have performed in line with company expectations, generating 15GWh which reflected a 3% capacity factor. Fixed and variable operating costs were also reported to be performing in line with the previous guidance the company had provided at the time of the acquisition.
Infigen also noted that the beginning of this year marked the commencement of its electricity-only Power Purchase Agreement with regards to the 21 megawatt (MW) Toora Wind Farm.
Market outlook for remainder of FY20
Infigen Energy has made some minor adjustments to the FY20 outlook it released to the market when providing its FY19 full-year results.
These adjustments include an improved electricity sales mix. In particular, the company noted a higher contribution from commercial and industrial customers, and also an equivalent decline in anticipated merchant revenues. As a result of this, 81% of the company's expected renewable energy generation, as well as 100% of its expected large scale generations, are now contracted for FY20.
In addition, Infigen Energy has slightly lowered its capital expenditure outlook, reflecting deferred timing of payments that were made in relation to the South Australia Gas Turbine (SAGT) relocation.
Commenting on Infigen Energy's outlook, Managing Director and Chief Executive Officer, Ross Rolfe, AO, said:
"Going forward we remain focused on maintaining high levels of customer contracting and delivering growth through procuring supply from an incremental 600-700MW of renewable energy capacity."
"While ongoing policy discontinuity creates an uncertain environment for agreeing Power Purchase Agreements, we remain confident in our ability to secure the 600-700MW of contracted capacity over the next two to three years," he added.
