Don't be concerned with the headline figures for Indian green tech company Greenko (GKO), which were distorted by a number of one-off items. Adjusted cash profits were actually up 46.5 per cent to €16.5m (£13.3m), despite adverse currency movements. Generating capacity rose from 183 to 289 megawatts (MW), leaving the renewable power developer on track to achieve its 1,000MW target by 2015. Management believes it will then have sufficient visibility to boost capacity further to 3,000MW.
The company currently has 500MW-worth of capacity under construction and an additional 850MW classed as under active development. The net book value of its assets rose 7.7 per cent over the half, driven by the rapid building programme. The ethical implications of the green tag are slightly misleading - Greenko is developing wind and hydro power because it is cheap. Imported coal can cost 5.1 rupees per kilowatt hour, for example, while Greenko can generate electricity through hydropower at 3.4 rupees.
Hydropower output rose from 104MW to 165MW, thanks to three acquisitions. While a late monsoon caused southern hydro output to fall, output in the north ran 15 per cent ahead of expectations.
Arden Partners has trimmed its full-year forecasts, but only to reflect recent adverse currency movements. It now expects adjusted pre-tax profits of €13.2m and EPS of 5.8¢, rising to €17m and 8.4¢ in 2014 (from €13.9m and 7¢ in 2012).
| GREENKO GROUP (GKO) | ||||
|---|---|---|---|---|
| ORD PRICE: | 135p | MARKET VALUE: | £203m | |
| TOUCH: | 130-137p | 12-MONTH HIGH: | 143p | LOW: 99p |
| DIVIDEND YIELD: | nil | PE RATIO: | 26 | |
| NET ASSET VALUE: | 136¢* | NET DEBT: | 74% | |
| Half-year to 30 Sep | Turnover (€m) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2011 | 19.8 | 3.09 | 1.15 | nil |
| 2012 | 23.7 | 1.74 | -0.62 | nil |
| % change | +20 | -44 | -46 | - |
Ex-div: na Payment: na £1=€1.236 *Includes intangible assets of €91.2m, or 60¢ a share | ||||
