Release Date: July 25, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Metlen Energy & Metals SA (MYTHF, Financial) reported a 5% year-on-year increase in earnings per share, exceeding EUR2.
- Net profitability rose by 5% to EUR282 million, and EBITDA increased by 8% to EUR474 million.
- The company's liquidity improved significantly, with current liquidity at EUR2.6 billion, up 15% year-on-year.
- The company has a strong outlook for the second half of 2024, expecting stronger performance across most subsegments.
- Metlen Energy & Metals SA (MYTHF) is confident in achieving its 2024 EBITDA target range of EUR1 billion to EUR1.2 billion and net earnings of EUR600 million to EUR700 million.
Negative Points
- The company faced challenges due to low power prices in Greece and the impact of energy price fluctuations.
- Gas trading performance was notably poor in the first half, with only slight improvement expected in the second half.
- The Greek government's tax on energy generation profits could impact profitability despite a strong July.
- Natural gas prices remain unpredictable, posing a risk to future profitability.
- Achieving a 30% market share in the Greek electricity supply is seen as a challenging and difficult task.
Q & A Highlights
Q: Given H1 EBITDA performance, are you confident in meeting the 2024 EBITDA target of EUR1 billion to EUR1.2 billion and net earnings of EUR600 million to EUR700 million? How do you expect the second-half profitability to unfold among subsegments?
A: Evangelos Mytilineos, Chairman & CEO, expressed increased confidence in meeting the targets set in June. He anticipates a stronger H2, with significant turnover and performance improvements across most subsegments, particularly in renewables and M Power Projects. Gas trading may see slight improvement but remains challenging.
Q: Could you provide an update on your potential listing on the London Stock Exchange?
A: Evangelos Mytilineos confirmed that the decision to proceed with the listing was made months ago and remains unchanged.
Q: What causes the spikes in DAM prices during evening hours, and is this positive for your profitability?
A: The spikes are primarily due to solar generation ceasing at sunset, increasing demand for other energy sources. This demand spike raises prices, which can be beneficial for profitability. However, recent spikes were due to broader European issues, not just Greek market dynamics.
Q: What are your estimates on CapEx for the current year and going forward?
A: Eleftheria Kontogianni, CFO, reported current CapEx at EUR311 million, with expectations to double by year-end, driven by renewable investments. CapEx is expected to decrease from 2025 as the company builds a critical mass of renewable assets.
Q: How are conversations around potential investment-grade upgrades developing, and is there a hard ceiling for your leverage ratio?
A: Christos Gavalas, Chief Treasury & IR Officer, stated the leverage ceiling is set at 3, with current leverage at 1.76. The company is confident in qualifying for an investment-grade upgrade, reflecting its strong performance and market perception.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
