Savosolar Plc’s business review for January–September 2020

Revenue and profitability continued to develop favourably - Seite 2

The demand for renewable energy, and especially for genuinely clean, emission-free energy, continues to grow when the actions to curb climate change increase. According to the International Energy Agency (IEA), only the production of renewable energy continued to grow during the early part of the year despite the Covid-19 pandemic. Heat production accounted for more than 50% of the global energy production in 2019. According to the IEA, only 10% of this was produced with renewable energy. In Savosolar’s estimate, less than three per cent of the global thermal energy was produced with clean modes of energy production in 2019.

In order to further step up its climate actions, the European Union has decided that 30% of its multi-annual budget and support instrument for recovery from the corona crisis for 2021-2023, totalling approximately EUR 1,800 billion, will be used for climate actions to strengthen the EU Green Deal programme.

In our estimate, the Covid-19 pandemic has caused delays in the investment decisions of certain industrial customers. The Covid-19 situation and potential new restrictions may further postpone client investment decisions and deliveries, and we seek to prepare for the potential effects of the pandemic situation on our business.

Our operating result for January–September was EUR -2.6 million. The net result for the reporting period also improved to EUR -1.0 million. The improved result was due to the increase in volume as well as the measures taken to improve our internal efficiency. We will continue our determined efforts to increase sales and to improve our internal efficiency towards profitable business.

In line with our strategy, we have continued to build our international partner network. After the reporting period, in October, we signed an agreement with a German company named Citrinsolar GmbH on cooperation in the sale and delivery of large solar thermal systems in Germany. In October, we also signed a cooperation agreement on the representation of our products with a Polish company named Eko Ekon. Our objective is to conclude the first solar thermal system delivery contract to Poland during 2021.

In Asia, cooperation with the Chinese company Guangzhou Power Supply Co., Ltd. advanced after the Covid delay in the spring. The objective is to build a renewable thermal energy system in Nansha, Guangzhou as part of the China-Finland Energy Programme. The project has advanced to the tendering stage, and if we win the competitive tendering, the objective is that an agreement is reached on the execution of the project during 2020.