Year End Report 2023 - Seite 2

Comment from Daniel Fitzgerald, CEO of Orrön Energy AB
“The fourth quarter marks an important step in Orrön Energy’s growth with the successful completion and handover of our Karskruv wind farm, adding around 290 GWh of annual power generation in the SE4 price region. This increases our annual power generation to 1,100 GWh and adds significant cash flow to our business. In early 2024, we acquired four greenfield wind projects in Finland with a total capacity of up to 180 MW, where land has already been secured, and coupled with the progress on our own projects, this adds to an already substantial development portfolio across wind, solar and battery projects spread across five countries in Europe.

We delivered the Company’s highest quarterly power generation in the fourth quarter of 2023, including one month of contribution from Karskruv. Wind speeds continued to be unseasonably low in the fourth quarter, meaning our production was slightly lower than expected, however, I am pleased to see that trend improving already in January 2024 with production above our forecast for the month. Electricity prices remained volatile during the fourth quarter, with the early part of the quarter affected by high hydrological balances in Sweden as a result of storm Hans, and the remainder of the quarter impacted by unseasonably low and variable wind speeds. January has shown a much improved picture, where we see a combination of higher winds and colder weather leading to a strong start for the Company in 2024.

Power generation and financial performance
We achieved proportionate power generation of 765 GWh for the year, and 226 GWh during the fourth quarter, marking the highest quarterly power generation for the Company. The full year power generation was slightly lower than expected due to lower than average wind speeds across the Nordics during a majority of the year. We delivered in line with or ahead of our expenditure guidance for the year, achieving an electricity price of EUR 47 per MWh, proportionate revenues of MEUR 36.2, proportionate EBITDA of MEUR 5.3 and ended the year with a proportionate net debt position of MEUR 92.4. Looking ahead into 2024, we increase our estimated annual power generation by around 40 percent to 1,100 GWh, while at the same time decrease our unit operating cost by 20 percent to EUR 15 per MWh, adding significant cash flow to the business. Our CAPEX programme for 2024 is also significantly reduced to MEUR 14, which can be fully funded out of cash generation at electricity prices of EUR 50 per MWh, which is in line with our achieved price in 2023. In the beginning of 2024, we increased our revolving credit facility from MEUR 150 to MEUR 190, adding more financial firepower that allows us to take advantage of favourable market conditions as they arise.