Mytrah Energy Ltd (LON:MYT) reported a jump in full year profit as the company increased its power generation capacity with the construction of further wind turbines.
Shares gained 5.45% to 26.62p in morning trading as the group reported underlying pre-tax profit rose to US$4.6mln in the year to 31 December 2016 from US$2.15mln a year earlier.
Revenue jumped to US$362.23mln from US$74.72mln, driven by 72% growth in power generation capacity.
Mytrah completed the construction of 417 megawatts (MW) of wind projects last year, which raised capacity from 583 MW at the end of 2015 to 1 gigawatt at the end of 2016, ahead of target.
The construction of more than 600 wind turbines was funded by securing US$1bn of financing during the year. The financing was also used to support the construction of solar projects in Telangana and Punjab
"In 2016 we commissioned more wind capacity than ever before, underlining both the capability of our team and the depth of our pipeline,” said chairman Ravi Kailas.
“This additional capacity helped to drive our EBITDA (underlying earnings) up 70% from last year on a directly comparable basis. India also experienced better wind conditions in 2016, which led to a 7% increase in power production on a like-for-like basis.”
Reported EBITDA rose to US$128.13mln from US$65.92mln.
Mytrah averts legal proceedings...
Meanwhile, Mytrah said its India business is yet to receive any fresh legal proceedings against it over claims it breached the terms of an agreement with a supplier of wind turbine generators.
In 2015 the supplier filed an application before the High Court of Telangana and Andhra Pradesh seeking appointment of an arbitrator on the allegations against Mytrah. An arbitrator was appointed by the High Court but has since passed away.
“Management has not acknowledged these claims as debts, given the nature of the underlying dispute, allegations between the parties and significant uncertainties relating to the financial claims,” Mytrah said.
Mytrah well-placed in growing India market...
Looking ahead, Mytrah said it was “ideally placed” in “fast growing and rapidly developing” India, which has a population of 1.2bn people.
“India is expected to grow at over 7% per year, according to the IMF, and there is clear evidence that electricity consumption is correlated to GDP growth,” Mytrah said.
“Both wind and solar power are faster to market and cost-competitive with alternative sources of power, which in India is primarily coal.”
In the current financial year, Mytrah won a 250MW wind power project in auction through the first competitive bid in the Indian wind power sector.