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Wind speeds returned to their historical range in the year to June, helping to lift revenues at Renewable Energy Generation, the Aim-quoted green energy company, by 23 per cent.
Andrew Whalley, chief executive, said wind speeds had been abnormally low during the winters of both 2010 and 2011 but they returned to more normal levels across the UK last year.
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Revenues in the year to June were also boosted as more wind farm projects became operational during the year.
At present, Renewable Energy operates 11 onshore wind farms, from Cumbria to Cornwall, and Mr Whalley said total sales will be boosted as three new plants come on stream. These include one at Sancton Hill in Yorkshire and another in County Durham. The group has also just gained permission to re-power St Breock wind farm in Cornwall generating 10 megawatts – enough power to supply about 20,000 homes.
However, Mr Whalley warned the results should be set against a regulatory and political backdrop that has not been easy for the windpower industry, with government policy becoming confused by “conflicting priorities of energy security, economy, affordability and sustainability for a growing population”.
The Jersey-based group said total revenues rose to £12.1m in the year to June, from £9.8m last year, and pre-tax losses improved to £2m from £3m in 2011. The loss per share narrowed from 2.56p to 1.74p in the same period. Adjusted losses before interest, tax, depreciation and amortisation at Reg Bio, the division that creates fuel from recycled cooking oil, narrowed from £1m to £244,000.
Renewable Energy also said it is proposing to pay an unchanged dividend of 1.5p a share and, in its next period of growth, will seek to “return some of the benefits of this growth to our patient shareholders”. Mr Whalley added that the group was generating substantial amounts of cash.
The shares – which were first quoted on Aim in 2005, when the group raised £25m at 100p – rose 1.5 per cent to 49.5p on Monday. In January 2011, the price had spiked by almost 30 per cent, nearly reaching 60p, after it emerged that the company had received an approach from a listed UK company at 67.7p a share. Renewable Energy’s board rejected the offer, arguing the intrinsic value of the company was substantially higher. Yesterday it maintained that there was still a “clear gap” between the discounted cash flow from assets and the group’s £50m market capitalisation.
