Why Tilt Renewables’ (ASX:TLT) FY21 profit plunged 86%

May 13, 2021 08:21 AM AEST

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Ashish

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Ashish - Financial Journalist
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Ashish is a Financial Journalist with an experience of nearly 9 years in the field of economy, stock market and foreign affairs. He has also spent a few years in the corporate sector. A mechanical engineer with post-graduation in marketing and operat...
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Why Tilt Renewables’ (ASX:TLT) FY21 profit plunged 86% — Image source: Olena Yakobchuk,Shutterstock

Summary

Tilt Renewables Ltd reported muted earnings for the year ended 31 March 2021.

Tilt’s net profit after tax (NPAT) fell 86% to AU$67 million.

EBITDAF was down AU$74.9 million from $117.5 million in FY2020.

Tilt Renewables Ltd (ASX:TLT) on Thursday reported muted earnings for the year ended 31 March 2021 on account of fiscal 2021 being a transition year following the sale of the 270MW Snowtown 2 Wind Farm (SWF2) in the prior period, combined with the boost in operations at Dundonnell and Waipipi.

The electricity generation company’s net profit after tax (NPAT) fell 86% to AU$67 million, while EBITDAF was down AU$74.9 million from $117.5 million in FY2020. With 29% gearing on 31 March 2021 and no debt refinancing requirements until 2023, TLT retained the debt headroom and flexibility to support the large development pipeline.

Source: ©Webking | Megapixl.com

In Australia, commissioning revenue from Dundonnell partially offset the loss of SWF2 production and softer spot prices. In New Zealand, earnings from Waipipi, which commenced commissioning in November 2020, more than offset the lower earnings from the existing New Zealand assets.

Fiscal guidance

The guidance for FY2022 has been split by the dual-listed company’s portfolio across Australia and New Zealand. The ramp-up of Dundonnell production was budgeted to continue through the first half, resulting in an Australian EBITDAF range of AU$58 to AU$66 million.

For New Zealand, Tilt’s EBITDAF guidance range, incorporating a full 12-month contribution from Waipipi, was expected to be AU$46 to AU$48 million, assuming average AUD/NZD rate of 0.93 and P50 wind production. Group FY2022 EBITDAF guidance was AU$104 to AU$114 million, based on P50 wind.

Source: ©Webking | Megapixl.com

Stock performance

On Wednesday, 12 May 2021, the stock of TLT Renewables closed unchanged at AU$7.41, as against the previous closing on Tuesday, 11 May 2021. TLT competes with Woolworths Group Ltd (ASX:WOW), Coles Group Ltd (ASX:COL), Coca-Cola Amatil Ltd (ASX:CCL), Treasury Wine Estates Ltd (ASX:TWE) and Metcash Limited (ASX:MTS), among others in the consumer sector.