Infigen’s Shares Uplifted on ASX Post Release of Results for 1HY19

Infigen Energy (ASX: IFN) is into the business of delivering energy solutions to large retailers and other businesses. It is a developer owner and operator of generation assets. The company uses the combination of renewable energy generation and firming solutions to supply clean energy. It has its own wind and solar projects, and currently it is into the development of options for firming in the NEM, in line with its business strategy.

The company today on 21 February 2019, has released its interim results for the period 31 December 2018. On the financial performance front, the net revenue for the company stood at $119.2 million for 1HY19 as compared to $118.2 million in the prior corresponding period, representing an increase of one percent approx. This was primarily on the back of 7% more production sold from owned assets, including the commencement of production at Bodangora Wind Farm however partially offset by 5% decrease in the average price Infigen received for electricity from Infigen’s owned assets and an 8% decrease in the average LGC price Infigen received. 

The EBIT for the reported period stood at $52.8 million compared to the prior corresponding period of $62.2 million with a decrease of 15 per cent. The decline in EBIT, however, is primarily due to the impairment of development assets recorded for the period to reflect increased costs and risks in realising the value of certain development projects.

On the balance sheet front, cash represented unrestricted cash of $86.1 million including cash on hand and term deposits held at call. Restricted cash was reported to be $22.0 million held in accordance with the minimum cash requirements for Australian Financial Services Licence (AFSL) compliance and the Bodangora PF. The debt drawn for the period consists of the corporate facility with a drawn balance of $502.5 million compared to $517.5 million in the prior corresponding period and the Bodangora PF with a drawn balance of $160.0 million compared to $158.6 million in the prior corresponding period.

The company is positive about both FY19 and the future. The energy market is dynamic, and Infigen is responding to it with a strategy for the future that is capable of adaptation to respond to emerging market dynamics and conditions. In short to medium term, Infigen’s contracted position will deliver reliable revenue outcomes.

On the price-performance front, the stock of Infigen Energy last traded at $0.495 with an increase of ~2.062% during the day’s trade and with a market capitalisation of $463.93 million. The stock has generated a YTD return of 10.23% and posted a negative return of 19.83% over the last six months; however, it has generated returns of 1.04% and 8.99% over the last three months and one-month period respectively. The stock has a 52-week high price of $0.750 and a 52-week low price of $0.410 with an average trading volume of ~1.98 million. It is trading at PE multiple of 10.10x with an EPS of AUD 0.048.


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