DGAP-News: Pacifico Renewables Yield AG initiates portfolio rotation to pave the way for entering the UK and battery storage market

Pacifico Renewables Yield AG initiates portfolio rotation to pave the way for entering the UK and battery storage market

• Agreements signed to sell Czech portfolio
• Proceeds from opportunistic disposal are intended to enable entry into UK solar market and potentially the battery storage market
• Portfolio rotation would allow increase of MW capacity without raising capital
• Revenue guidance lowered to between €30.0 and €40.0 million due to disposal

Gruenwald, July 11, 2022 – Recently, Pacifico Renewables Yield AG (ISIN: DE000A2YN371) (“Pacifico Renewables”), an independent producer of electricity from renewable sources, signed agreements to dispose of its Czech portfolio comprising four solar parks with a total installed capacity of 7.5 MW. The proceeds from the disposal are intended to enable the acquisition of first projects in the UK and potentially entering the battery storage market. In addition, Pacifico Renewables’ first portfolio rotation would allow for further portfolio growth by using the company’s equity capital even more efficiently.

Entry into UK solar and potentially battery storage market

Since entering into a partnership with Boom Power, a solar park and energy storage developer based in the United Kingdom, in 2021, the cooperation between Pacifico Renewables and Boom Power has continuously intensified, and first projects are expected to reach the ready-to-build phase soon.

Christoph Strasser, Co-CEO: “Accelerating the energy transition as a dynamic and agile company was key for us from day one. With this disposal, we take the next step forward. We are selling operational assets impacted by regulatory instability in order to enter new markets with promising prospects for us. In particular, we are excited to shift our focus more and more towards battery storage – a technology which will play a key role in accelerating the energy transition. This applies not only to the UK, but to increasingly more markets as demonstrated by the most recent regulatory change to facilitate the build-out of more battery storage in Germany.”

On June 27, the Bundestag passed an amendment of the Energy Industry Act to include a new definition of energy storage, which facilitates the implementation of more consistent regulation and is expected to lead to fewer double charges, which previously occurred due to the classification of energy storage as both a consumer and producer of electricity. Pacifico Renewables is optimistic that this amendment will help accelerate battery storage development activity in Germany, providing Pacifico Renewables with further investment opportunities in an attractive market, both in terms of technology and geography.

Disposal of Czech solar parks

The company’s management has decided to dispose of its Czech solar parks at an enterprise value of approximately €20 million. Even though the Czech parliament imposed an additional solar levy of 10% in September 2021, the company was able to achieve an attractive price after having received interest from several parties and does not expect any impairments in its consolidated group financials. With this transaction, Pacifico Renewables will exit the Czech markets in order to shift its focus towards markets with superior future growth potential. The reduction of regulatory risks in the portfolio was the main driver for this opportunistic disposal, along with the release of capital for new investments and the favorable timing.

Dr. Martin Siddiqui, Co-CEO: “Exiting the Czech market lays the foundation to enter the UK solar and battery storage market. This perfectly combines our priorities and is another proof that we strictly adhere to making the most efficient use of our capital.”

Guidance adjustment

On the occasion of the disposal, the management board lowers its revenue guidance for the financial year 2022 from between €33.0 and €43.0 million to between €30.0 and €40.0 million. This adjustment is based on (i) deducting the expected revenues of the Czech portfolio, (ii) group-wide year-to-date production in line with expectations combined with high electricity prices, (iii) the possibility of continued high electricity prices, (iv) no reinvestment of the disposal proceeds and (v) assuming no further acquisitions.

The adjusted guidance only relates to revenues from operating activities. Due to the disposal, all Czech revenues from financial year 2022 (including the first half year) will be excluded from the Group’s reported revenues from operating activities for the full financial year 2022. Income from discontinued operations will be reported as a separated item and not recognized as revenues. The revenues of the Czech portfolio amounted to approximately €5 million in each of the years 2020 and 2021. Due to the continuing high electricity prices, the management board expects that part of the operating revenues which are lost as a result of the disposal can be offset by additional revenues due to high electricity prices in other markets.

About Pacifico Renewables Yield AG

Pacifico Renewables Yield AG is an independent power producer listed on the open market of the Dusseldorf Stock Exchange with additional requirements (Primärmarkt) (ISIN: DE000A2YN371) with the aim of building up a gradually growing portfolio of plants for energy generation from renewable sources. With operational wind and photovoltaic power plants spread across Europe, the company offers a clear and diversified profile with stable and predictable earnings.

Disclaimer

This announcement may contain certain forward-looking statements, estimates, opinions, and forecasts concerning the future business situation, earnings situation, and results of Pacifico Renewables Yield AG (“forward-looking statements”). Forward-looking statements can be identified by words such as "believe", "estimate", "anticipate", "expect", "intend", "will", or "should" and their negation and similar variations or comparable terminology. Forward-looking statements include all matters that are not historical facts. Forward-looking statements are based on the current opinions, forecasts and assumptions of the management board of Pacifico Renewables Yield AG and involve significant known and unknown risks and uncertainties, therefore actual results, performance and events may differ materially from those expressed or implied by forward-looking statements. Forward-looking statements contained herein should not be construed as guarantees of future performance or results and are not necessarily reliable indicators of whether or not such results will be achieved. The forward-looking statements contained in this release are only valid on the date of this publication. Pacifico Renewables Yield AG will not update the information, forward-looking statements or conclusions contained in this release in light of subsequent events or circumstances, nor will it reflect subsequent events or circumstances or correct inaccuracies that arise after the date of this release as a result of new information, future developments or otherwise, and the company does not assume any obligation to do so. The company does not assume any responsibility whatsoever that the forward-looking statements or assumptions contained herein will occur.