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Arise Windpower AB reported its third-quarter 2025 financial results, revealing a decline in net sales to SEK 88 million. Despite the revenue drop, the company is expanding into new markets and technologies, which could drive future growth. The stock price fell by 0.65% to SEK 30.6 following the announcement, reflecting investor concerns over the earnings miss and current financial performance.
Key Takeaways
- Arise Windpower’s Q3 revenue decreased to SEK 88 million.
- The company reported a net loss of SEK 9 million.
- Expansion into Germany and Finland is underway, focusing on battery energy storage and data centers.
- Stock price decreased by 0.65% in pre-market trading.
- Strong cash flow, with SEK 322 million in operating cash flow.
Company Performance
Arise Windpower’s performance in Q3 2025 was marked by a decline in net sales and a net loss, contrasting with its strategic expansion efforts. The company is venturing into new geographies and technologies, aiming to diversify its portfolio in wind, solar, and battery energy storage. This diversification is intended to offset the challenges posed by fluctuating power prices and macroeconomic uncertainties.
Financial Highlights
- Revenue: SEK 88 million (decreased from previous periods)
- Earnings per share: SEK -0.18
- EBITDA: SEK 22 million
- Operating cash flow: SEK 322 million
- Cash flow after investments: SEK 251 million
Market Reaction
Arise Windpower’s stock price fell by 0.65% to SEK 30.6 in pre-market trading, reflecting investor concerns over the company’s financial performance and earnings miss. The stock is trading closer to its 52-week low of SEK 29.3, indicating cautious sentiment in the market.
Outlook & Guidance
Looking forward, Arise Windpower is targeting 400 MW in transactions by the end of 2025 and aims to meet its 10-gigawatt financial target. The company’s diversification strategy into solar, battery energy storage, and data center development is expected to support future growth.
Executive Commentary
CEO Per-Erik Eriksson stated, "We are well positioned to catch opportunities in soft markets," highlighting the company’s strategic position despite current challenges. CFO Markus Larsson added, "We have the means to continue our journey to grow," indicating confidence in Arise’s financial and strategic capabilities.
Risks and Challenges
- Fluctuating power prices could impact revenue.
- Macroeconomic uncertainties may affect project timelines and costs.
- Supply chain issues, particularly in turbine supply, could delay projects.
- Low industrial energy consumption may dampen demand.
Q&A
During the earnings call, analysts inquired about the Fasicon project’s revenue recognition, which has been paused due to turbine supplier cost uncertainties. The company also discussed ongoing sales processes for battery and development projects, with potential project sales valued around EUR 500,000 per megawatt.
Full transcript - Arise Windpower AB (ARISE) Q3 2025:
Conference Operator: Now I will hand the conference over to the speakers. CEO Per-Erik Eriksson and CFO Markus Larsson, please go ahead.
Per-Erik Eriksson, CEO, Arise: Thank you very much. I will start with a brief introduction of Arise, starting with our three business segments. We have, to the left, the development business. We have currently some 9,500 megawatts in our pipeline, closing the gap to 10,000 megawatts, which is our financial target to reach this year. We have, since inception, divested some 1,620 megawatts. So that’s the development business. Our production business, IPP business. We have, at the moment, 172 megawatts in own production, corresponding to a budgeted annual production of some 430 gigawatt hours per year. The third leg is our solutions business or services business. We have currently some 2,350 megawatts under management and currently 105 megawatts under construction for second project. We think we have a quite robust and complementary business model. With that said, we can flip to the next slide. This shows our current focus areas, geography.
It also shows how Arise developed during the last five years. If you start to the left, in 2021, we mainly had operations in Sweden and only focusing on wind. Now we have operations in six different geographies covering wind, solar, and BES. If you start with Sweden, which still is the center of gravity for Arise, we cover all technologies: wind, solar, PV. We have, as mentioned, our own production assets. We are an active developer. We do asset management and construction management. U.K., we started up operations in the U.K. in 2022. We cover all technologies, mainly focusing on development. We do wind, solar, and BES. Finland, the same scope, acquired Point Voima in 2023. We cover all technologies, focusing on development. We also have quite material asset management operations in Finland as well.
Norway and Ukraine, we are focusing on development, greenfield development, only wind, quite low dev expand in Ukraine and Norway, I can mention. The latest geography in Arise is Germany, focusing on BES and acting as a developer in Germany. Germany, I will mention more in the next slide. We are continuing our diversification journey. This will show two good examples that demonstrate that we are a fast-moving organization, rapidly capitalizing on our know-how. The first example is the market entry into Germany. Actually, we started up last year to do a market analysis second half of 2024, concluding that we see business opportunities in BES in Germany. Now we have three employees by end of third quarter. We have a fast-growing pipeline. We did the first acquisition of project rights, three projects in total, 120 MW. On top of that, we do greenfield.
Development in Germany. We can see quite good growth already. We have quite ambitious targets to do the first transactions already next year. Another good example is data center development. We see quite clear synergies and a quite natural evolution of our development business to move into data centers as well. Key features are a bit the same. Require land, data center require land, access to land, access to grid and fiber infrastructure, and of course, a permit in the end of the day. All this is within our normal scope. First project is already in early stage. In Finland, we have secured land. We have a good understanding of grid capacity and also fiber infrastructure that is available. We have an estimated capacity of some 400 MW, which is a large scale. I learned it is defined as a hyperscale data center.
If we manage to do this or to take this to transaction, we believe that we could see quite significant profit potential in this. With that, I hand over to Markus.
Markus Larsson, CFO, Arise: Thank you, Per-Erik. Yeah, we released the Q3 numbers this morning, and net sales for the quarter decreased to SEK 88 million. This is a decrease that, in all aspects, derives from a lower revenue recognition within the Development segment, which trickles down to EBITDA and EBIT, which came in at SEK 22 million and SEK -1 million, respectively. This was also affected by the extraordinary cost in July of approximately SEK -15 million, which is related to the acceleration of the ShareLion project. This results in a profit after tax of SEK -9 million or SEK -0.18 per share. On the other hand, a very strong operating cash flow during the quarter of SEK 322 million. Majority obviously driven by the earnout in ShareLion. Cash flow after investments amounted to SEK 251 million.
Our own production generated 64 GWh with an average income of SEK 434 per MW hour. If we look into our segments, Development posted SEK 25 million in EBITDA, mostly driven by the ShareLion earnout, which I mentioned just on the previous slide. The earnout contributed to EBITDA by EUR 3 million. At the same time, there has been no revenue recognition in project Fasicon due to some uncertainties in the project cost for Fasicon. Also, we do not expect to make any further revenue recognition in Q4 either. Late-stage portfolio increased by approximately 500 MW, mostly driven by the projects Per-Erik just mentioned in Germany and Finland. Production posted SEK 18 million EBITDA, so a slight decrease in both production and the realized prices. In addition, the grid that we now own between Fasicon and the connection point to the regional grid was commissioned in Q3.
This had a positive EBITDA impact of approximately SEK 3 million in this quarter. Solutions back on track to SEK 3 million in EBITDA due to the full quarter effect from the ShareLion OMA, which came into force in June. This is the first quarter where we had the full effect. In addition, we announced the assignment with EIP and Fortum of 350 MW, which will be in force as of this month in November and contribute going forward. The portfolio, as I mentioned, increased by 500 MW, largely due to the German BES and the Finnish data center. I think overall, we are seeing very strong progress in advancing all the late-stage projects. In the U.K., for instance, we submitted several late-stage projects into Gate 2 of the grid reform process, which is very, very positive.
Overall, I would say that we are well on track and pretty confident that with this portfolio, we’ll meet the 10 gigawatt financial target that we have by year-end. That’s a hand back over to you, Per-Erik.
Per-Erik Eriksson, CEO, Arise: Thank you, Markus. Market development looking on power markets. We have, during the quarter, seen increasing forward prices driven by a normalized hydrological balance in the Nordics. We still see some surplus in the north, but also deficit in the south of the Nordics. Fuel prices continue to be rather stable. And by saying fuel prices, I mean gas and coal. European forward prices sideways in general. Looking to the bottom left, you can see the graph. In the bottom, you can see I’m a bit colorblind, but the blue line is system price and the gray is SE3, and the orange one is SE4 prices. On top, you have the German prices representing the continental European prices. You can see the second half of this year that the Nordic prices have started to move upwards, very much driven by the hydrology in this case.
Looking at spot prices, you see the graph to the upper left. You can see that prices, this is showing system price, the blue, gray is SE3, and the orange one is SE4. You can see prices picking up. This is the monthly average prices picking up second half this year. Yeah, and we should also mention the balancing market here, still volatile, but somewhat calmer over the quarter. I would say that the amplitude in the swings in the balancing market has become smaller. Continental European prices, as said, quite stable, driven by gas prices. We had, during summer, a continuous injection in gas storages that held up the prices. There are still a lot of macroeconomic uncertainty and still low energy consumption, especially on the industrial side.
We still see the gap, the quite big gap or even huge gap between Nordics and continental Europe, that it remains. As we see it, if we have a bit colder winter than normal, if we see industrial consumption picking up again, this could be an arrival on the upside in the Nordics. We see some upside or hope for some upside in Nordic power. With that said, we take the next slide. Ending 2025, we have less than two months left of this year. To start with, we have some ongoing transactions that we already mentioned: solar and BES projects in the U.K., a development portfolio, and a BES project, a large-scale BES project in Finland. Those transactions are ongoing in a structured manner where we have advisors having a structured process. We have a target to reach 400 MW by the end of this year.
400 megawatts in total, 2024 and 2025. That target remains. We think we have good traction in the sales processes, but obviously, we have a quite challenging time perspective here, only less than two months left. If we fail in closing the transactions this year, in worst case, it is likely that we have a good start of 2026. As said, the target we have is to close this year. Our strategy with diversification continues and is expected to contribute going forward. Contribute in terms of transactions. We are very happy to conclude that we have the means both for organic growth as well as selective acquisitions. We have a solid cash position and also cost-efficient access to an EUR 40 million facility on top of that. We think we have a very strong financial position in general.
We have also a strong track record and excellent in-house resources. All key resources are in-house. I would especially mention that we have built up the organization in M&A. We have quite a strong M&A team now. All in all, we are well positioned to catch opportunities in soft markets. I think that’s it. We leave the floor for questions.
Conference Operator: If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Caleb Solomon from SEB. Please go ahead.
Caleb Solomon, Analyst, SEB: Hi guys, thank you. Just a few questions from me. First, on the paused revenue recognition from Fasicon, what kind of cost uncertainties are we talking about? Can you give some more color on that? Also, is any part of it related to delays in the construction timeline? Are you expecting to recognize revenue again in Q1?
Markus Larsson, CFO, Arise: Thank you, Caleb. Thank you for your questions. In terms of if I recall them correctly, the first question related to the type of cost kind of overruns or uncertainties, and it’s mostly related to the turbine supplier. Where we expect to see some cost increases. The second question, in terms of timing, timing does not impact the earnout in Fasicon. It’s just kind of actual cost versus the construction budget.
Caleb Solomon, Analyst, SEB: Are you expecting to recognize revenue again in Q1?
Markus Larsson, CFO, Arise: No, I wouldn’t expect to recognize any further revenue until full takeover when it’s potentially done when it’s finally settled.
Caleb Solomon, Analyst, SEB: Okay. On the impairment test, I noticed that the impairment test you carried out in the quarter showed an excess value of EUR 40 million, which is quite a bit below the EUR 70 million last year. Can you give a bit of color on what factors explain that, given that the discount rate seems unchanged?
Markus Larsson, CFO, Arise: Yeah. In all material aspects, that’s related to price curves. You have some effect also from a lower FX, lower euro to SEK, but 80% or so, I would say, is related to the price curves.
Caleb Solomon, Analyst, SEB: Because you usually say a 1% change in discount rate is about EUR 10 million on the impact on the excess value. What kind of movements have you seen in price curves? Is it 1%, 2%, 5%, 10%? Like how much?
Markus Larsson, CFO, Arise: Hard to quantify in terms of %, given that it’s 50 years of data points or 30 or whatever it is. Yeah. But I would say it’s maybe much more conservative on the front in the short term, which has some impact, of course. In addition to overall lower curves.
Caleb Solomon, Analyst, SEB: Okay. Just the last follow-up on that. Can you sort of break out how much of the book value is attributable to the producing assets right now? Or can you just remind us?
Markus Larsson, CFO, Arise: Sorry, can you take that again? How much book value is Production? Just below SEK 1.5 billion, I would say.
Caleb Solomon, Analyst, SEB: Okay. Thank you. On the price contracts that you disclosed this quarter, can you remind us how much of that is any of that new, or is it the same one you signed last quarter? Kind of as a follow-up to that, are you expecting to secure anything for the rest of 2026 as well?
Markus Larsson, CFO, Arise: Are we hedging? Yeah. Yeah. I mean, we have a short-term perspective when it comes to hedging. Trying to basically to be, we are monitoring the market on a daily base and trying to catch opportunities in the market. I won’t say we are speculative, but we have some target levels where we do some hedges. I would say if we see a bit, prices continue to pick up, we will do more price hedges. We have some target levels already now that we are working on. I believe we will do more price hedges during winter, yes. There were some were done during Q3, yes.
Caleb Solomon, Analyst, SEB: Okay. Thank you. And just lastly, on the volume targets, they imply you’re going to sell another 235 MW in Q4 since you’re reiterating them. And you sort of said ongoing sales processes exceed that volume. My first question is, I mean, I appreciate it’s hard to give an exact answer, but sort of how confident are you in that figure? Second, can you give some more color on what the mix could potentially be, both in terms of technology and maturity of those projects? Is it mostly ready to permit or ready to build?
Markus Larsson, CFO, Arise: Yeah. Yeah. Starting with the last question, when it comes to the BES projects we have under transaction in Finland that is ready to build, we have all the permits in place. We have a grid connection agreement in place. So that is just set to start construction works, basically, when everything is arranged with financing, etc. When it comes to the U.K. portfolio, it is a bit different story. That is a development portfolio, meaning that we would, if we manage to do that transaction, expect to have an upfront payment, and then it will be milestone payments based on performance in development. That was the last question. What did you say earlier? What we expect? How confident?
Caleb Solomon, Analyst, SEB: Yes.
Markus Larsson, CFO, Arise: How confident? Yeah. That’s a tricky question. Definitely, I am confident that we will be managed to do this within, let’s say, half a year. If we manage to do it within two months. But we believe in that. It’s doable, but it’s challenging. That’s the current timetable. Yeah. Obviously, we are working hard. I almost said hell, but we are working hard to do that. We have ongoing, we have people engaged trying to do everything they can to manage that. It’s a challenge. Of course, the market environment has been quite soft for a while. We see good traction at the moment. We definitely believe that transactions will happen.
Caleb Solomon, Analyst, SEB: Okay. Just one last follow-up, and then I’ll leave you to it. Because you said it was ready to build, but it was battery projects in Finland and in the U.K. portfolio. It’s sort of more ready to permit and followed my milestone payments. Is it fair to say that the sort of average blend pricing-wise is well below EUR 1 million per megawatt, maybe somewhere closer to EUR 500,000?
Markus Larsson, CFO, Arise: Yeah. Yeah. Of course. It’s difficult to say since it’s a bit of moving targets. But in that range, I don’t think that’s totally out of range.
Caleb Solomon, Analyst, SEB: Okay. Thank you for taking my questions.
Conference Operator: As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. There are no more questions at this time. I hand the conference back to the speakers for any written questions and closing comments.
Markus Larsson, CFO, Arise: Maybe I could take some of the written questions. A bit ad hoc. One of the questions is how much the 120 MW battery rights were acquired for. And I would say ballpark. Below EUR 100,000 in total. Another question is if we intend to utilize the remaining 27 million second authorized share buybacks. Not really a resolution for management. That’s obviously a board matter. Do we have the financial means to do more buybacks? If that’s the case, yes. But again, it’s a question for the board. Let me see. I think that’s basically what’s relevant to answer on the written questions. I think we have another one online. Yeah. Okay. That’s it. If we don’t have other questions on the line. Okay. Thank you. Then perhaps it’s time to sum up. Some last comments from my side. Arise continued to perform well.
Of course, the bottom line results could be better. On the other hand, we deliver an extremely strong cash flow that has created a very solid financial position. We have the means to continue our journey to grow and look forward to end 2025. Thank you very much for attending.
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