Tidal power and vertically integrated turbine supplier SIMEC Atlantis Energy (LON: SAE) saw its annual losses double on-year, due to the financial strain of investment in alternative energy projects.
While the Company were able to celebrate some success with revenues jumping from £0.3 million to £2.2 million on-year, their profits were ultimately weighed down by extensive expenditure. This caused the firm’s pre-tax losses to widen from £11.1 million to £24.2 million for the full year through December.
The central cause of this loss Simec Atlantis said, was its continued investment in its tidal power and waste-derived pellet projects – which we can only speculate at being part of the Company’s long-term strategy.
SIMEC Atlantis comments
Tim Cornelius, Chief Executive of Atlantis, commented on the results:
“In many ways, 2018 was a breakthrough year for SIMEC Atlantis. In April, Phase 1A of our flagship MeyGen tidal energy project entered its fully operational phase helping us to grow revenues and, with all four turbines successfully installed, has now delivered over 17 GWh of predictable and sustainable energy to the grid. In June, we completed the acquisition of the 220MW Uskmouth power station.”
“Our ambition is to grow quickly to become the leading independent generator of sustainable energy in the UK and we are making significant steps towards achieving that goal: we have commenced work on the world’s first conversion of a coal power station to 100 per cent waste derived fuel at Uskmouth; and we are expanding MeyGen with Phase 1B (Project Stroma) through the installation of two additional turbines.”
“Our sustainable energy projects are not just good business, they are making a meaningful contribution towards tackling some of the biggest issues facing society today: climate change and the war on plastics.”
Update on acquisition agreement
SIMEC Atlantis announced on the 18th of June 2019 that they had successfully reached a conditional agreement to acquire Green Highland Renewables and on Friday the Company updated investors on this subject:
“As announced on 18 June, the Company is considering an alternative transaction structure in relation to GHR. Atlantis now has agreed to release the SIMEC group from its obligations under the SPA in consideration for receipt of a payment in cash of approximately £5 million, pursuant to a payment agreement, (the “Payment Agreement”) which will be deployed towards the delivery of its flagship 220MW Uskmouth waste-to-energy conversion project. Furthermore, SIMEC has agreed pursuant to a loan agreement made between Atlantis and SIMEC, subject to the satisfaction of certain conditions precedent, to make a £2 million interest free loan available to Atlantis (the “Loan Agreement”). Further information on these agreements is provided below.”
The Company’s shares are currently trading down 12.75% or 2.2p at 15.05p a share as of Friday afternoon 28/06/19 14:22 GMT.
Elsewhere in the renewable energy sector, there have been recent updates from; The Renewables Infrastructure Group Ltd (LON: TRIG), Tekmar Group Plc (LON: TGP) and Remote Monitored Systems PLC (LON: RMS).