Earnings call transcript: Cloudberry Clean Energy sees growth in Q1 2025

Cloudberry Clean Energy reported a robust performance in the first quarter of 2025, marked by increased revenue and EBITDA compared to the previous year. The company’s diverse renewable energy portfolio and strong cash position contributed to its solid financial standing. While the stock price saw a slight decline of 1.93% in pre-market trading, InvestingPro data shows the stock has gained 30.16% over the past year, despite a 6.44% decline year-to-date. For deeper insights into Cloudberry’s performance metrics and valuation analysis, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro.

Key Takeaways

• Revenue and EBITDA increased year-over-year, driven by higher power-related revenues.
• The company maintains a strong cash position with a 2.2 billion NOK debt facility.
• New projects are underway in Denmark, Sweden, and near Stavanger, Norway.
• Over 80% of the company’s debt is fixed at long-term rates below 4%.
• The stock price declined by 1.93% in pre-market trading.

Company Performance

Cloudberry Clean Energy demonstrated solid performance in Q1 2025, with revenue and EBITDA showing significant growth compared to the previous year. The company’s strategy of diversifying its renewable energy portfolio, including hydropower, wind power, solar, and battery storage projects, has positioned it well in the competitive Nordic energy market. The company also reported a strong cash position, supported by a 2.2 billion NOK debt facility, with most of its debt fixed at favorable long-term rates.

Financial Highlights

• Revenue: Increased from the previous year due to higher power-related revenues.
• EBITDA: Also showed growth, contributing to the company’s improved financial performance.
• Debt: 2.2 billion NOK facility with over 80% fixed at long-term rates below 4%.

Market Reaction

Despite the positive financial performance, Cloudberry Clean Energy’s stock price fell by 1.93% in pre-market trading. This decline could be attributed to investor concerns about the company’s future growth prospects and the impact of recent transactions on equity. The stock’s movement contrasts with the company’s strong financial position and ongoing project developments.

Outlook & Guidance

Looking ahead, Cloudberry Clean Energy plans to continue developing attractive projects in the Nordic markets. The company aims to maintain a 50/50 equity ratio in projects and focus on profitable growth. Expansion of the hydropower and battery storage project portfolio is a key priority, alongside the continuation of its capital recycling strategy.

Executive Commentary

• Anders Lemburg, CEO, emphasized the company’s commitment to being present in all phases of renewable projects, highlighting the importance of a diversified portfolio.
• Ole Kristoffer Bragness, CFO, reiterated the company’s focus on profitability over growth, maintaining a balanced approach to financial management.

Risks and Challenges

• Market Saturation: The Nordic energy market is competitive, and maintaining a leading position requires continuous innovation and expansion.
• Regulatory Changes: Potential changes in energy policies or regulations could impact project development and profitability.
• Economic Conditions: Broader macroeconomic pressures, such as inflation or interest rate fluctuations, could affect financial performance.

Q&A

During the earnings call, analysts inquired about the CapEx for the Ullustar project, which stands at $68 million with a $3 million contingency. Questions also focused on the company’s low balancing risk in Norway and Sweden portfolios and the Danish wind capture rates, which are at a 10-20% discount to the area price. The ongoing development of the Bjornskarshberg Swedish wind project was also discussed, highlighting Cloudberry Clean Energy’s commitment to expanding its renewable energy footprint.

Full transcript - Cloudberry Clean Energy As (CLOUD) Q1 2025:

Anders Lemburg, Presenter/Executive, Clabric Clean Energy: Hi and welcome to Clabric Clean Energy’s Q1 twenty twenty five presentation. My name is Anders Lemburg and I am joined today by our CFO Ole Kristoffer Brag ness. We will take you through a short presentation and it’s also possible to post questions, so please use the Q and A function and we will try to answer as many of the questions after our short presentation. The agenda today starts with me giving you some highlights and introduction to Cloudbury. Ulik Stofer will take you through the financial numbers before we open up for questions.

Starting off with the highlights of 2025, we have increased our revenue and EBITDA from last year. We have also realized a power price well above the system price in The Nordics and we are proud to quarter after quarter realizing a higher power price than the system price in The Nordics and we will get back to the reason for that in the end of the presentation. As you can see here on the right hand side, our production is increasing, also the installed capacity is increasing and we are happy happy to see that our team in Denmark is up and running. We have both a development team and an asset management team on the ground in Denmark and we are now working on new projects to increase our footprint in the Danish DK1 attractive price area. We have also worked on our hydro portfolio in Norway.

We have just started construct a new hydropower plant outside Stavanger in the attractive price area NO2 and we will see more hydropower projects and more hydro permits application coming into our portfolio over the year. And last but not least, we are very happy to see that all our Siemens Gamesa turbines now is returned to service, has returned to service at the Udal Wind Farm, and this has an impact on our Q1 numbers and will also have an impact going forward. Very happy to see that the wind farm is up and running approximately a year after we had an incident last March. Before going into the numbers, let’s have a look at Clabbery Clean Energy. We have developed a platform that develops, own and operates renewable assets in The Nordics.

We believe strongly in being present in all the phases of renewable project, that we have the opportunity to develop our exclusive portfolio, our exclusive backlog with projects from greenfield. We can develop them and when they are permitted construct and put them into production and also manage our assets as we also manage a lot of third party assets in The Nordics. This gives us a unique flexibility to always focus on where we see the best returns for CloudBerry. Another important side of our project is that we have different technologies. We have hydropower, wind power, solar and BEST projects.

Put these together you will have a very stable production profile throughout the year, much like a base load profile. This is also important for us to have this stable project portfolio generating long term cash flow for Glowbray. As you see here on the right hand side, we have developed a project portfolio in the most attractive price areas in The Nordics. We have believed in being in the price areas where you see that the interconnect ors were coming, interconnectors to The UK, to Germany, to The Netherlands, to Poland and so forth. And we see also now that these are the attractive price areas when it comes to new demand.

We have our projects close to new data center projects, to new logistic hubs in South Of Sweden. We are closely working with the Power2X industry in Denmark and seeing now that it is very important to develop a project that is attractive for the demand side and we can offer a stable power production with our mixed technologies. All the different projects, different technologies and price areas gives us this unique flexibility that we strongly believe is important also going forward. Diving into the production portfolio, we have created, as mentioned, a diversified production portfolio, diversified of technologies, price areas and countries. We have now over one terawatt hour in production generating cash flow to the company.

At the same time, we have been able to develop our exclusive development portfolio, our backlog. Here you see on the left hand side how this backlog has grown over the years with both projects that we work on to apply for a permit, but also we have a permitted portfolio. This has been growing over the years and we see still it’s very important for us to keep focusing on growing this portfolio. We also have, as you can see here on the right hand side, managed to divest and also to sell some of our projects. We have shown over the last years that we have a strong value creation out of our portfolio where we have sold projects or farmed down projects generating NOK500 million gain over last years.

This recycling we will also see as continuing going forward. So both having a production portfolio and an exclusive development portfolio is important for us. As mentioned going forward, I think we will continue to see that we manage to develop attractive projects. We have now a larger footprint in Denmark with a new 160 gsvH portfolio of producing assets, DK1 being the strongest price area in The Nordics. We will continue to focus on that and also continue to focus on developing new projects like the NESHEAD project, as you see here.

It’s a wind solar best project and we are working on this and hopefully you will see FID on this project later in 2025. In Norway we have done some hydropower projects and also hydropower sales and generating more than 2x book value on the sales of these hydropower assets. We think that the hydropower segment will be strong also going forward and we will continue to focus on building a larger development portfolio of hydro projects so we can have more in our energy mix, but we can also recycle when we see that we get the right price level for our projects. In Sweden, we will continue to cooperate with the large landowners like Holmen, continue to focus on larger projects. And also here, as you see, we have a battery storage project in Sweden, SE3, which is very important when we also see how the market and the balancing market is developing.

So here we are constructing a storage project with a lot of different opportunities and value stacking this profitability first, very important for us, to show that we can deliver profitable growth. That will continue to be our focus. It will also continue to be our focus to stay well financed, to have a strong balance sheet, to always be financed for our projects and also to keep on developing our team to develop our platform and continue to deliver projects on time and at cost or below cost. So more of the same is summing up our strategy going forward. Before I hand over to Oleg Stoffe here, just a short update on our ESG and HCSC.

We have had no damages in Q1. We have had no whistleblowing incidents in Q1 and we will continue to focus on our safety culture in Cloudbury. And here on the right hand side, you see a drill from our Sundby Wind Farm in Q1. So with that, I hand over to Orik Stofer and he will take you through the numbers and then I will come back afterwards. Thank you.

Ole Kristoffer Bragness, CFO, Clabric Clean Energy: Thank you so much Anders. Hi everyone. My name is Orik Stauffer Bergnes, CFO of Glabri. I’m happy to take you through the financial story of this quarter. So before we dive into the details of this quarter, it’s good to get a burst of view of our development in our balance sheet since our listing.

When we started out in 2020 we had a relatively small production profile and development backlog and permitted project. This has grown quite significantly throughout our journey. Always delivering on projects on time and cost while creating a sufficient producing asset base that we’re now able to capitalize on through generating cash flows. That’s been very important throughout our journey while we’ve also had a strong focus on capital discipline in order to fuel this. We raised equity at accretive prices throughout this journey while being cautious of the debt.

Having sufficient debt facilities in place has been important us as we’ve had that and increased that throughout this journey while drawing up this debt as we needed liquidity in order to grow further. But having the equity on hand and the cash balance on hand has given us opportunities to act on what we see has been available to us. Going forward now, as Anders talked about earlier, we have a production profile of around one terawatt hour diversified throughout The Nordics giving us a great foundation in order to grow further. So that’s been very important to kind of look at the bird’s eye view here before we kind of dive into where we are for this quarter. Looking at the right hand side here for Q1 twenty five, we continue on the trend but you see a small drop in the consolidated equity.

Good reasons for that, which I come back to on the next slide here, but that has to do with the transaction we just did with Skovroyd. So while the overall equity has gone down slightly, the equity to the controlling interests, I. E. The shareholders of Calgary, has increased since ’24. Diving into the Q1 twenty five balance sheet financial, we can start out with taking that equity side.

We see that equity is somewhat down quarter since year on year, but the share to controlling interest has increased. So when we acquired the remaining 20% of the Udin portfolio from Skogoid, which he utilized to reinvest into Cavalry, But when we acquired that, this is a transaction with the equity with the non controlling interest. So we acquired a non controlling interest from our balance sheet through our cash balance on the asset side. So this reduced the non controlling interest from $760,000,000 in Q1 twenty twenty four to only 131,000,000 in Q1 twenty twenty five. So the equity to the controlling interest has increased both in nominal terms and also important in book value per share as we print the shares to SCORGO at 17 kroners per share in order to finance this transaction.

I urge you to see the quarterly report for more information how this transaction influences on the balance sheet side as this purchase price allocation is quite technical. So more on that there and reach out if there are further questions. The cash side, we have strong cash position and our debt has been increased somewhat as we draw on debt in order to increase our liquidity from projects that has been equity financed. And we have still the facility in place of 2,200,000,000.0, where we are currently 200,000,000 approx current undrawn from our local savings banks, and very good dialogue with them to potentially increase that further if need be, and also an accordion of 300,000,000 that we can utilize. And of course it’s been important to us to hedge our debt positions as we’ve grown and reporting to date we still have above 80 percent of our proportionate interests.

That is fixed at long term agreements at an all in rate of below 4% and average tenure of approximately ten years. And that’s a strategy we’ll continue on doing as we withdraw the debt. Reverting back to our liquidity and commitments overview. We show this slide every quarter now and it’s good to see what the liquidity is available to us in order to continue to grow. Since last quarter we have paid some of the CapEx on Sundby Munkitas as they are completed.

Still some small CapEx items left in relation to tidying the site and some grid, etcetera. And also added on the Obrilostal project, which Anders talked about, the new hydro construction project. So 93,000,000 now in remaining committed CapEx in Calgary. On the other side, Kvema, the hydro project which was completed and taken over by Calgary last summer, that’s still equity financed. We can draw that debt when need be, but we still have that equity financed as we don’t want to draw that debt and pay interest on it when we have sufficient available liquidity, but that can be drawn on very short notice.

And again, like I talked about on the last slide, we have some remaining debt facility there in place, 140,000,000 approx after joining the Quellema debt. And we have an accordion and strong relationships with the local savings banks and other banks if we need to increase that facility further to fund our remaining portfolio and continuous growth. But we still remain intact with the notion that we want to be fiftyfifty percent equity in that in a project. We don’t want to go beyond that. Then reverting over to the P and L side, we see the same story as we did in the balance sheet, just the income side of it.

So we’ve had strong growth in our journey since listing and as we have more and more assets producing, we have the cash flow for production, selling the power in the southern price, generating high power prices. So that’s been good to us. But also very important is the capital recycling and also the value creation from a development side has been very important and fueled Clabbery’s growth in our financials. We’ve had internal sales of Hornsund and Bommunketan as they’ve been completed in 02/2004, generating strong value creation in the development or projects segment, which you can see in the proportionate financials. All are third party evaluations showcasing the value created there development phase, but also to capital recycling on the hydropower side in 2023 and 2024, showcasing the value of our assets.

Capital recycling has been important to us and will be important to us in order to fuel growth as profitability is very important and profitability over growth remains an intact story like Anders talked about. Also the value creation that’s been done in the project segment will continue to be a strong factor for CloudBerry, although lumpy as it will tide over to project realizations. More on that later. Looking at the Q1 financials, we see we have an increase in proportionate revenue and EBITDA on the back of higher power related revenues. And taking one step back again, proportionate financials, that reflects the ownership stake in all assets, Notably that includes Uda and Forta, where are the minority shareholder and the ownership adjustment in the Udne portfolio.

Looking at that in relation to consulted revenue, we see a slight decrease in power related revenue. That’s primarily caused by Denmark where we had lower wind resources over the quarter. And again, as Odin is fully consolidated and Odin and Fortra are not included with their are only included with the net income and not the EBITDA and revenue in the consolidated financials, then the lower wind resources in Denmark affects consolidated figures on a relatively much higher level than the proportionate financials. So that’s the main reason why they have the differences here between the consolidated and the proportionate. Just to clarify the recent acquisition we completed over the quarter in Denmark, which Anders talked about, that’s finalized at quarter end, so you do not have any P and L effects notably in this quarter for the revenue generated from the 160 gvh we acquired, and that will continue to generate cash flows as we go on from the next quarter.

In terms of the segments, commercial segment remains an important driver for CloudBerry. This is where we sell our electricity. Power production has increased to 194 from 173 and as this is a winter quarter in Q1 wind power remains the majority of our production and that has increased over the quarter on quarter mainly due to Uldal ramping up production, which is great to see and then soon Beomunktitan also being completed, while Denmark has shown less production over this quarter compared to last quarter due to lower wind resources. But more on that in the quarterly report if of interest. Like Anastragbat, all turbines in accordance with Simska Mesa and production will continue to ramp up through ’25 as final appraisal inspection has been completed.

Average price of 0.71 compared to 0.73 in Q1 twenty twenty four, much higher than the system price showcasing the favorable position in the southern price areas in The Nordics which has been the strategy from day one. On the right hand side there we showcase the last twelve month figures and this is the same comment that we had the last quarters, but just to clarify again, we’ve had accretive asset sales in both ’24 and ’23 which you see in the Q1 twenty four LTM and the Q1 twenty five LTM. The gain in ’23 was a nominal larger gain at two times book value compared to the gain we had in ’twenty four at 2.3 times book value. So more accretive sale but less nominal value. When you deduct these we have growth in the LTM figures as well.

And lastly on the remaining segments, we have the project segment, we’ll start there. Revenue has decreased with NOK6 million but that’s due to Sunbeam Okitan being transferred to the commercial segment as they have been completed. We showcased that in Q4 twenty twenty four realizing a strong gain of approximately million per megawatt and as a development gain there, recording the project segment representing the value creation for the project. Excluding this, EBITDA is comparable with the last quarters. And it’s important here again that it’s driving the projects forward, increasing the backlog.

That’s the main value driver for the project segment and you’ll only see that value creation in the financials as the projects are realized. For the asset management segment that’s been has had a great increase now with the Skorba transaction, increasing the solar capabilities in Denmark. Having a Danish football is very important to us and the team will continue to manage the Ulden portfolio as well, which they have been. So we have a great foundation now to continue to grow the asset management side of Denmark. And lastly, corporate segment is in line with previous quarters and also please note there’s a non cash cost here related to warrants of NOK4 million, which is booked over the quarter.

So all in all, a good quarter for Clabbery. Then, we’re working back to you Anders for markets and summary before we take some Q and A at the end. Thank you.

Anders Lemburg, Presenter/Executive, Clabric Clean Energy: Coming in for landing here, just a couple of slides. Here you see the Nordic long term power price and as you see Clabri has delivered well above the system price. Quarter after quarter we managed to get the better price than the Nordic system price and that is due to, like Ulrik Gustafus said, the price areas that we are in, but also that we have managed to enter into PPAs on attractive levels and that’s also part of our strategy is to be well financed and we don’t need to enter into any PPAs when we do our FIDs on the projects. We can finance the project and we have no requirements for PPAs, but of course if we see that we get attractive prices for some of our assets in the most attractive price areas, we have entered into PPAs and we will continue to also do that as long as it is on attractive levels for Clowbridge. But that’s also part of the flexibility that we have in Clowbridge that we can choose to enter into PPAs when we think it’s right and the level we think is right and we don’t have to do that to finance the construction projects.

So here you see the Tehma Nordic power price and what we have delivered over the last quarter. To sum it up, we think that we are perfectly positioned. The strategy is working. We like to stay Nordic. Nordic countries have fantastic resources when it comes to hydropower, when it comes to wind and so forth.

And we have a lot of projects, we have a lot of opportunities and we will continue to focus on delivering profitable growth. We will continue to develop our platform with all the great people. We will continue to deliver development projects at time and cost. And with all that and the market also developing in a positive way, we believe that we are perfectly positioned also for the future. Thank you so much for listening into our presentation.

I could see that we have got some questions and I will hand over the word to Orik Stofer, who will answer some of them and I will also get back to some other questions.

Ole Kristoffer Bragness, CFO, Clabric Clean Energy: Thank you, Anders. I can start out with taking two more detailed questions. So the first one is Ullustar. We reported a $68,000,000 in CapEx there. Someone has been correct that saw that we only have 65,000,000 in contractual commitment which is reported in the notes.

The difference in the 3,000,000 is what we have added on as internal contingencies and so forth which is customary for these kind of projects. So that’s just the contingency and internal hours which is the difference there. That cost then is all in. They include the entire EPC contract Clabber, and it’s a good way to showcase how a project can come directly from pipeline and into project under constructions and not necessarily through backlog as we have a vast network and also with entrepreneurs, etcetera, that want to work with us, and that’s how we got access to this project. Also a question about capture rates in Denmark, how that performed over the quarter.

Capture rates are hard to estimate how they will develop going forward. There’s a lot of very reputable analyst firms that does this which I’ll hand over to if you have more questions about capture rates. But we see maybe Denmark capturing say ten, fifteen, 20 percent discount to the area price, but that will vary from quarter to quarter depending on wind resources and other external factors, so not something we can be very precise on. Those were the two questions I recorded, Anders. Do you have other?

Anders Lemburg, Presenter/Executive, Clabric Clean Energy: Thank you. I have got a question here for balancing risk and how we handle this in Clowberry is that we do not have any balancing risk in our portfolio in Norway and Sweden. We rather try to look at this balancing cost as an opportunity. Dinghilsson, the best project in Sweden, Nesheid, also with battery storage in Denmark, and we have several other projects with battery storage and how to turn this into something positive in both Norway, Sweden and Denmark. Balancing costs and risk are very low in the Claberry portfolio.

And another question was Bjornskarshberg, which is a Swedish wind project we have developed. It has been also some focus on this project in media. We are continuing to developing the project and we hope to take the next step in the permitting process later in 2025 and it’s then a work in progress in Glabri. Thank you. I think that was it.

That was the questions we had and thank you so much for attending and listening to our presentation and have a nice day. Thank you.

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