Abengoa posts €5.56bn Q1 profit after completing financial restructuring

Spanish renewable energy Abengoa has announced a positive first quarter bottom line of €5.56bn, including non-recurring profits derived from its now-completed financial restructuring.

In its first quarter of it had finalised its financial restructuring process on 31 March, after conduction a share capital hike and issuing warrants. For the three month period, Abengoa booked a non-recurring profit of €5.81bn that takes into consideration the cancellation of financial liabilities for €8.46bn, recording of €1.94bn in new refinanced debt, a negative tax impact of €566m and €138m in fees and other costs.

As a result of the financial restructuring, consolidated gross financial debt has significantly been reduced from €12.258 million at the end of 2016 to €5.734 million on 31 March, 2017. Out of the €5.734 million of gross financial debt, €2.257 million correspond to debt of companies classified as held for sale.

During March 2017 Abengoa completed its financial restructuring process. On 28 March, 2017 the company executed the share capital increase and issued the warrants, as approved in the General Shareholders’ Meeting held on 22 November, 2016.

Revenues in the engineering and construction activity reached €295 million and the earnings before interest, tax, depreciation and amortisation (EBITDA) amounted to €49 million, versus €391 million and €7 million respectively in the first three months of 2016.

‘Strong restrictions of financial resources’

According to Abengoa, this revenue decrease is mainly due to the strong restrictions of financial resources the company has suffered for more than 18 months, which has negatively affected business development, particularly in projects in North America, South America and South Africa.

Also, the EBITDA figure includes the aforementioned one-off costs related to the financial restructuring of €52 million that, if adjusted for, would leave EBITDA of the engineering and construction activity at €3 million.

Abengoa’s backlog in engineering and construction as of 31 March, 2017 amounted to approximately €2.400 million, including bookings of new projects for a total approximate value of €200 million in Chile, Argentina, United Kingdom and Belgium, among others.

Revenues in the concession-type infrastructure activity reached €41 million and EBITDA amounted to €25 million in the first quarter of 2017, compared to €34 million and €21 million, respectively, during the first three months of 2016. This increase is mainly due to revenues from the South African thermo-solar plant Khi which entered commercial operation at the end of 2016 as well as higher operational results from certain assets in Algeria, Uruguay and Brazil.

The sale of Abengoa’s biofuels plants have not been mentioned in its financial statement.

This story was written by Liz Gyekye, editor of Biofuels International.