Good Energy’s profit before tax increased in 2023 as the renewable energy services company delivered on its strategy to become an end-to-end microgeneration specialist.
The 2023 full year marked a year of transformation for Good Energy, in which it transitioned to operating as an end-to-end renewable energy services business providing a one-stop shop for climate-conscientious households.
During the period, Good Energy completed the acquisition of Wessex EcoEnergy enabling them to enhance their solar installation service. The deal adds to similar acquisitions that bolster heat pump installations.
Customers can use Good Energy for energy supply, installation of heat pumps and solar panels, smart metering, and the capability to sell their energy back to the network.
The company has now installed 47,000 smart meters, meaning that around 58% of the company’s domestic customers now have them installed.
Despite a volatile year for energy prices, Good Energy produced a 2.4% increase in revenue and increased gross margin to 17.4% helped by power purchase agreements.
“Against a backdrop of continued volatility in the energy market, 2023 saw Good Energy undergo a transformation from pure renewable supply and Feed-in-Tariff administration to a fully-fledged clean energy services business,” said Nigel Pocklington, CEO, Good Energy Group.
“Following multiple acquisitions in the heat and solar space we can now offer customers premium services across supply, export, heat pumps, solar PV, storage and EV charging.
“Alongside this, we are now a leader in smart export for small scale solar and have trialled innovative flexibility services for businesses and consumers to shift their demand to cut their carbon further. Good Energy is establishing itself as the microgeneration specialist for the premium end of a rapidly growing market, offering everything a home or business needs to go greener, from a trusted brand with unparalleled expertise.”
The 2.4% increase in revenue reflected substantially lower wholesale prices at the start of 2023 compared to the end. Good Energy sees energy prices trending lower through 2024 leading to both lower revenue and cost of sales.
Reported profit before tax of £5.7m in 2023 compared with an underlying profit before tax of £1.4m in 2022. Good Energy recorded a one-off gain in 2022, meaning the reported profit before tax was £9.2m.
Good Energy’s balance sheet is exceptionally strong. Cash and equivalents grew to £41m in the period and total liabilities fell to £69m. Trade and other receivables also fell to culminate in £42m total equity at the end of the period.
In terms of the EV/EBITDA ratio used to assess the true value of the business, Good Energy trades at a material discount to peers.
After a substantial rally in Good Energy shares in the runup to results, investors booked profits on Tuesday sending shares lower in early trade.