Q2 2025 Enlight Renewable Energy Ltd Earnings Call
Good day, and thank you for standing by. Welcome to the Enlight Renewable Energy Ltd. Q2 2025 earnings call.
Please be advised that today's conference is being recorded, I will now like to hand the conference over to Jonah West director I please go ahead.
Thank you, operator. Good morning, everyone, and thank you for joining the second quarter 2025 earnings conference call for end night, renewable energy.
Before beginning this call, I would like to draw participants' attention to the following.
Certain statements made on the call today including but not limited to statements regarding business, strategy and plans.
Our project portfolio Market opportunity utility demand and potential growth discussions with commercial counterparties and financing sources pricing trends for materials.
Progress of company projects including anticipated timing of related approvals and project completion and anticipated production delays expected impact from various regulatory developments completion of development. The potential impact of the current conflicts in Israel, on our operations and financial conditions and Company actions designed to mitigate such impact.
And the company's future financial and operational results and Guardians including revenue and adjusted ibitta.
Our forward-looking statements are made within the meeting of U.S. Federal Securities laws, which reflect management's best judgment based on currently available information.
We reference certain metrics in this earnings call and additional information about such metrics. Can be found in our earnings release.
These statements involve risks and uncertainties that may cause actual results to differ from our expectations.
Different materially from our forward-looking statements.
Although we believe these expectations are reasonable, we undertake no obligation to revise, any statements to reflect changes that occur after this call.
Additionally non-ifrs, Financial measures may be discussed on the call.
These non-ifrs measures should be considered in addition to and not as a substitute for or in isolation. From our results prepared in accordance with the RFS
We can salvation to the most directly comparable IFRS Financial measures are available in the earnings release. And the earnings presentation, for today's call, which are posted on our investor relations web page.
With me this morning are Gilad Yavetz, CEO and co-founder of Nite, near Huda, CFO of At Night; Adam Pishl, CEO and co-founder of Clara; and Jared McKe, incoming CEO of Kona.
Gilad will provide some opening remarks and then turn the call over to Adam and Jared for a review of our us activity. And then to near for a review of our second quarter results.
Our executive team will then be available to answer your questions.
Thank you for joining us today for in light, second, quarter 2025 earnings call. We are pleased to report another strong quarter of results, revenue and income, grew by 53% compared to the same quarter last year, reaching 135 million.
Adjusted ibida also increased by 57% to 96 million.
Net income amounted to 6 million, compared to 9 million in the same quarter last year. But mainly due to the accounting classification of a foreign currency shareholder loan impacted by exchange rate values. Given this momentum we are raising our full year 2025 guidance ranges. Using the midpoint of this new ranges revenues rise to 528 million from 500 million previously and adjusted evida Rises to 393 million from 370 million previously.
This represents a 5 to 6% increase at the midpoint for both metrics respectively.
And underscores confidence in our business Outlook.
The company is advancing with the roadmap, which we first presented in May, targeting an annual revenue run rate of roughly $2 billion by the end of 2028, roughly four times the 2025 revenues.
Near will provided detailed financial review later. In the call, we've also recently announced an expansion of in light executive leadership team.
A deal is your turn will take on the role of Co of the company at the start of October.
And I will transition to become the executive chairman of the board in full-time capacity.
The ills Russy was served as chairman of the board for the past 7 years, will assume the role of Vice chairman following 2, Decades of leadership roles with global cooperation, such as 3M. And Mackenzie, and Co in Israel. China, and the US a deep brings the wealth of experience to Enlighten. Her addition to the executive team reinforces, our core values of excellence, and integrity and will contribute valuable management insight and best practices from a Fortune 100 company.
I will continue to work closely with AI the board and the leadership, as well as all the employees of enlight remaining, fully committed to steering and light's future growth.
The current market environment for the renewable energy sector across geographies is positive. Now,
Fundamentals remain very strong as the electrification trend and especially AI are driving demand. Significantly Beyond Supply leading to continuing increases in power prices. In parallel, the cost of solar panels and energy storage equipment, continues to decline, reaching historic close.
As a result, renewables are the most cost-effective method for generating electricity, and we are continuously increasing the gap versus conventional energy.
With lower capex and higher power prices. We Believe project returns will remain attractive in the regions we operate in.
Specifically in the US regulatory Clarity and a supportive business environment, create the runway for Accelerated growth.
Very favorable for the utility scale, solar and storage segments. Providing the larger companies, such as in light, a window of significant growth opportunities.
It allows and light to continue with our major expansion plan through 2028.
Solar levelized cost of energy remains extremely price competitive compared to traditional power sources, especially in the southwest UF, 1 of our Prime development markets.
Given the cost effectiveness of our projects. We believe we are well positioned to continue. Growing also Beyond 2030 in a subsidy free environment.
Atom will give more details on our us project progress shortly.
In Europe, we are seizing the energy storage opportunity.
Given the high percentage of renewable within Europe's energy Supply. We see very strong demand, for storage cost of energy. Storage equipment are at historic close coupled with high price Arbitrage and ancillary Services revenues. We expect to generate very attractive returns in the region.
As a global front runner, in energy storage, in light was early to identify the opportunity in this segment and 7.8 gigawatt hour of our total portfolio. Comprises of energy storage projects in 5 countries in Europe.
3.6 gwh hour of which are expected to reach operations by 2028.
Finally, we are breaking into new areas of growth. Also, in Israel.
Given Israel's market dynamics and dependency on solar within the renewable sector. We see very strong need for energy storage in the country where we are the leading player in our expanding rapidly, with 6.9 gigawatt hours of Planned storage projects in our Advanced development and development portfolios.
Following the recent Land Reform aggro solar is taking large steps forward and we are very early to secure dozens of land agreements for the segments.
On the basis of our experience. In Israel, we are positioned to Pioneer. The Agra solar Revolution also in other geographies worldwide with similar needs.
We see demand for data centers, in the coming years and the important role that energy plays in developing and operating these assets.
We are in the early stages of developing. The land. We recently acquired in the south of Israel for our First Data Center
A location surrounded by adjacent renewable. Energy sites.
To summarize this quarter, we demonstrated robust Financial results and raised our guidance, strengthen our senior leadership and made tangible progress across our near and long-term growth plans, positioning and light to continue outpacing the market in both growth and returns.
Now, I'd like to turn the call over to Adam.
Thank you. Gone, our us business continues to experience, incredible growth with achievements and construction financing. And the development of our deep project pipeline, we are demonstrating our ability to build profitable projects and continue to deliver power to meet America's increasing energy demand.
I'm happy to report our snowflake a project nurse and Don, Arizona has mobilized and entered in a Full Construction.
Through early construction activity. This summer we have States Harvard the project for optimal tax credits.
Snowflake a includes 600, megawatts of solar power and 1.9 gigawatt hours of battery storage.
And is the first of 2 length projects that will fill 1 gigawatt interconnection on the site.
Snowflake, a is currently scheduled the Cod and 2027.
We continue to make progress at our three other projects under construction this year.
Let's move on to a project located east of Tucson, Arizona.
Roadrunner, solar and storage includes 290 megawatts of PV and 940 megawatt hours of battery storage.
Just last month, we successfully completed the initial energization of the substation, a major Milestone, the rocking and tracking systems are complete and we are more than halfway through installation of the solar modules.
We are using Tesla Mega packs as our battery storage solution. Those are installed and we are making good progress on the wiring and power management system.
The project remains on schedule for a Cod towards the end of 2025.
Moving on to our second project outside Albuquerque, New Mexico.
Solar and storage includes 128 megawatts of PV and 400 megawatt hours of battery storage.
Files. Racking and tracking, equipment are complete and we are over halfway complete with the module installation.
Currently the batteries are being delivered and installed.
Our final project under construction is Country Acres. A 403 megawatt, PV and 688 megawatt hour, battery storage project located at outside Sacramento, California.
Construction on the PV site is well underway and we have completed the golden row achieving the important real world testing of the design and clearing the way for successful construction of the rest of the site.
We continue to work on piles and racking the batteries are scheduled to be delivered. This winter, the project remains on schedule for COD by the end of 2026.
As we announced last month, Jared mcke our chief commercial. Officer will take my place as CEO beginning in October 1st of this year.
Jared has been a leader at clean air for nearly a decade. He has played a key role in building our robust development pipeline of projects,
And creating the structures and processes needed for us to execute the funding and construction of those projects.
His growth into the CEO role brings the leadership strengths and continuity needed to expand our U.S. business.
It has been an honor to see the company. I co-founded 12 years ago, emerge as a market leader.
as Jared takes over the day-to-day leadership, I will remain a part of the queen era and inlight family serving as Vice chair of the Clean Air Board and an executive adviser
Let me close by emphasizing that the demand for energy continues to soar and our unique ability to build and deliver large power and battery storage facilities. At a fast pace makes us a Prime Choice for utilities seeking new, sources of power across the country.
Our outlooks remains very positive as we deliver the next generation of reliable affordable clean energy projects to the market.
Jared, would you like to say a few words?
I would thank you, Adam.
It has been an honor to learn from you and the nlight leaders, as we build a world-class Renewable Energy company.
My time leading the development team involved a focus on implementing process and operational improvements to expedite to conversion of projects from ideas to reality and to continually grow our early Greenfield development efforts.
I look forward to advancing our company to the greatest period of growth. Yet, I'm excited to step into this leadership role with a special focus on execution and delivery of projects that will take us through. Not just the near-term, but for many years to come,
I will be sharing more of our growth story during future earning calls.
Thank you and let me turn the call over to near.
Thank you Jared in the second quarter of 25, the company's total revenues and income increased to 135 million up from 88 Million last year, a growth rate of 53% year-over-year. This was composed of revenues from the sale of electricity which was 37% to 160 million compared to 85 million in the same period of 24 as well as recognition of 19 million in income from tax benefit compared to 3 million in second quarter of 24.
Revenues from the sale of electricity grew due to the contribution of newly operational projects.
Since the second quarter of 24, 3 of the solar and storage cluster unit in Israel, Atrisco in the US pooping in Serbia, and Tulsa in Hungary All Began selling electricity the most important increases originated at Atrisco, which added 13 million followed by the Israel, solar and storage cluster which added 12 million in total, new projects contributed 30 million to revenues from the sale of electricity revenues and income were distributed between Mana Europe and the US with 40% of revenues in the second quarter of 25 from Israel, 35% from Europe and 25% from the US.
Hey Justin from the effects of foreign currency revaluation net income amount to 16 million compared to 7 million last year. An increase of 110% year-over-year
By 57% to 96 million compared to 61 million for the same period in Q2 2024.
The increase in adjusted ibida was boosted by 47 million stemming from the same factors that drove the revenue and income increase mentioned above.
Along with recognition of 3 million in compensation, linked to blood failures to the Beyond project in Sweden.
It was offset by an additional 13 million in cost of sales, linked to new projects. While other operating expenses Rose by 3 million looking to our balance sheet and like completed the financial close for the hybridization of the hakama project in Spain, secure in 310 million. In financing. For the addition of 225 megawatt of solar and 220 megawatt hours. Storage capacity to the existing 329 megawatt Wind project,
Since the fourth quarter of 24 and light has raised 1.8 billion in Project finance and 300 from corporate debt and asset sales to support its expansion plans with particular focus on the US.
In addition to these funds, we have 525 million of credit facilities at several Israeli and International Bank of which only 9 million has been drawn as at the balance sheet date.
In addition, we have approximately 1 billion of LC and surety bond facility supporting our Global extension of, which half was available for use, at the end of the quarter,
This further increases our financial flexibility, as we continue to deliver on our growth strategy.
Given the strong financial performance during the first half of 25, we are raising. Our 25 guidelines with revenues and income. Now, expected between 520 million and 535 million and adjusted. Evida expected between 385 million and 400 million representing a 5.5% and 6%. Increase for both metrics respectively, compared to our previous guidance ranges.
Our revenues and income guidance, for 25 includes recognition of an estimated 70 million to 80 million in income from us tax benefit, and 90% of 25 generation output is expected to be sold at 6 price either through Hedges or ppas. I will now turn the call over to the operator for questions.
Thank you.
To ask a question. Please press star 1, 1 on your telephone, and wait for your name to be announced.
To waste your question. Please press star 1 and 1 again.
Questions will be our answered in the order. They are received.
We will now take the first question.
From the line of smart stros from JP Morgan. Please go ahead.
Yes, hello there. Thank you very much for taking our questions. Um, so my first question uh kind of thinking about Safe Harbor and the July 7th executive order from president Trump uh you know, kind of the industry just waiting to see what the the new guidelines potentially might be. Um with regards to the inline, I'm curious you've got some projects that are scheduled to be complete.
Uh, by the end of 27, or potentially, first, half of 28 uh you know, CEO bar and snowflake kind of curious, you know, to the extent. You, you safe harbor those already. But if the, the Safe Harbor rules change, can you talk about your ability to accelerate those projects to to, to ensure that they are complete by the end of 27? Uh, and therefore, we don't have to worry about, uh, potential Safe, Harbor guidelines.
Hey, hi Mark, its gilad. How are you?
Uh so I will start with uh with the answer then Jared if you want you can compliment me. So to start, I would say that uh currently we already have 6 gigawatt.
That are fully Safe Harbor.
Which is for 6.5 to 8, gigawatts to be connected uh to the network. In addition we believe that with uh, the I would say, uh, the fact that we are a large developer,
uh, with good access to Capital and cost of capital, and a lot of I would say very good, uh, liquidity
Uh, relatively we are in a very good position if we need to accelerate, uh, cash investment in order to meet, uh, potential, uh, different criteria. So, we believe that we are positioned in a very good, uh, situation first. Uh, we are reaffirming our road map that we announced on the 27th of May to reach 1.4
Billion of total revenues and income uh and and and as a r by the end of 27 and 2 billion of ARR by the end of 28. So we are reaffirming that after the reconciliation bill.
But we believe we are also positioned very well in order to say uh, adjust to any different criteria. If such is introduced Jared would you like to compliment?
Thank you.
in respect to CLR and snowflake, we
We are.
starting construction, we have
Ability to to meet the needs of both.
already starting construction in respect to Safe harboring and as gilad has mentioned, we had the ability to to meet the
demands. If if there are some in the future to accelerate construction, um, seal bar and snowflake are already expected to be online before the end of 2027. And so they already fit within the schedule of the, uh, executive order.
Perfect. Okay. Thank you very much. And then just a follow-up, uh, you know, with, with India, being in the news, um, you know, in 1 of your major panel suppliers located in in India, uh, Curious, you know, to the extent that India, uh, tariff rates coming into the US increase, um, or you know, the, the new Ab CBD case that's out there, uh, including India. Uh, can you talk about your your supply? Uh, if you're locked into that Supply, um, and your ability to pass that on, uh, in your PPA. Uh, if you are in fact, locked into that supply. Thank you.
Yeah, Jared. You can start with our supply chain strategy and I will complement afterwards.
so project currently,
By the new ADCB case, um, against Laos. Indonesia and India are are, are next wave of projects will be connected. Contracted such that ABCD will not apply.
Yeah, and I will just add that, uh, I think we are now benefiting from very diversified supply chain strategies. So we have many sources of production for the panels, also coming from many countries.
So, uh, uh, it seems that since the, you know, the Tariff uh, uh, regulation was introduced. We see that we have very good resilience, uh, against um, you know, different, uh, orders in this regard. So we are very confident that we will meet that.
Uh, Mark if I just add 1 more thing in terms of the um, in terms of the uh, interaction with the worry, we're not locked into anything. It's an option to purchase. Uh and we have no, um, liability. We have no um requirements to to to buy from them.
Great, thank you very much.
Thank you.
We will now take the next question.
From the line of Justin Claire from Rose Capital Partners. Please go ahead.
Maybe not uh, subject to the executive order. So any way to quantify how much of the 6 gigawatts was safe? Harbored prior to 2025
Yeah, so first, it's important to mention that according to the Reconciliation Bill, we have until July 4, 2026, in order to make projects eligible for the Safe House. So at this point in time, having 6 gigawatts out of the 6.5 to 8 gigawatts plan.
It's a very, very good position and I would say that, since the 27th of May where we first introduced our plan, we had back then, 4.9 gigawatts, and then we qualified additional 1.5 gig 1.1. Sorry. Gigawatts coming from the snowflake project. Uh, so we are, we we are now already have 6, gigawatts. So the, the pace is very high and I believe that by, uh, you know, the end of June 26th, we'll have, uh, eligible much more than, you know what? We anticipated.
Got it. Okay. All right, that's helpful. And then wondering if you could just speak to also the uh the trend in ppas you're seeing for us projects, uh, maybe specifically for, for COD dates out in the 2028 or 2029 time frame. It might be a little bit early at this point, but would you anticipate a a decrease in the supply of projects in those later years? Uh given the potential reduction in in the tax credits uh available there. And would you expect a upward pressure on um, on ppas
Yeah, Jared. Uh why you want to start? And again I will compliment afterwards.
Yep, not a problem.
As we look to 202728292030, it will largely depend on what our the components of the executive order and also the adjustments. If any, on the start of construction requirements, um, it it is too early to know where and how the supply will adjust, uh, without the guidance coming in. Um, as you can
Be sure that we are tracking and monitoring the guidance and as it comes out, we will adjust 1 of the things that we are doing. Is we are advancing our start of construction.
strategy to ensure that we have the most projects possible that are ready to
deliver in 2829 and 2030.
Yeah, Jared. I I I will add just that uh
We think that the decisive here factor is the demand for electricity. There is a very strong demand for electricity as, you know, in the US coming. Uh uh mainly from the data center industry and Ai and so forth.
now, uh, if you refer to, uh,
You know, the standard economy of solar energy and storage in Europe and in all the developed worlds, so our lcoe is already economical and does not require the tax equity.
the fact that the reconciliation bill allowed,
Uh, gradual time for the US market to adapt to that is very favorable and and and we believe it's the right policy. But we believe that by the end of 2030 or 2829 2030, the US market will be already. I would say, will adapt already, uh,
Uh, you know, the world economy where, uh, the cost of 1 megawatt is 600k, rather than 1.2 million and therefore, we are, you know, very optimistic about the continuing, the growth in the US based on a non- tax Equity economy, starting from 2030. And also, I refer the fact that energy storage has even more, you know, a gradual a timeline. So, we believe that, uh, the US economy or I would say the administration did the right thing by, uh, allowing the US market to adapt to that with, uh, uh, uh, demand for electricity being, you know. Uh, the, uh, I would say the most important factor here.
Okay, I appreciate it. I'll pass it on.
Thank you.
We will now take the next question.
From the line of Ken Blanchard from Deutsche Bank, please go ahead.
On for current, um, congrats on the guidance race. So, my first question concerning that FX has been a pretty meaningful Tailwind for you guys here today. Um, can you parse out the contribution of FX to the increased guidance? And then talk about what assumptions you have baked into the guidance for FX?
Yeah, thanks for the question. So first uh yes. Uh we also benefited from the FX uh but I think that the we raised the um uh guidance also due to very strong performance that we had with our plans and the fact that we execute on time and we focus to continue to execute on time. So we believe that the combination of, you know, this period positive effects but with very strong fundamentals on the operation and execution allows us to be confident on the future and we believe that this trend will continue.
Okay, thank you. That's really helpful. Um, the second question I have is around component costs, given so during your prepared marks you mentioned,
That falling component costs is a key driver. Um, can you talk about just the differences between the US and the rest of the world and how you see us component costs for batteries and modules point out?
Yeah. So naturally uh first you know as uh most of the common components are generic such as uh solar panels and uh inverters and of course, battery cells. And for. So, first of all first, yes, it can be comparable but of course, under regulation. Uh, I would say environments such as tariffs uh, domestic content and so forth. So, clearly in the US the same modules, or the same equipment, cost more mainly due to uh, mainly due to um tariffs. But also we believe that the tax Equity environment is also contributing with and this is a factor that increases a little bit. Let's say the overall would say pool of the cost of the project, part of it goes to the lenders or to the tax Equity providers part of it to the uh, contractors. So we see also higher Bop cost in the US.
Per kilowatt than let's say, in the other developed countries. So we believe that this will adapt itself. I would say gradually, but with tariffs, of course, according to the administration policy, and we believe that the electricity prices in the market will reflect the change. So, uh, to the extent that it will be tariffs, they will be reflected in electricity prices and ppas.
Because of the demand to De demand for electricity, of course.
Great. Thanks so much.
Thank you as a reminder to ask a question. Please press star 1 and 1.
We will now take the next question from the line of Mando from mizuho. Please go ahead.
Hey uh, thank you, thanks for taking the questions here, uh, and and congratulations. Have a nice quarter here. 1 question just on the Safe Harbor. Uh, expectations here on August 18th. Just want to understand 1 Thing uh based on your checks with lawyers. Uh is it possible that they might change the rules for project diversity properly, July 4th, or that something which uh to basic law is not possible again.
Yeah, so I am a hip so first, I guess that we are following uh, you know uh the analysis of the law firms, like yourself, and it looks like the broad. I would say consensus is that there will be no or cannot be a retroactive uh legislation and therefore it will not be affected, but of course we will follow it like everyone else. And uh we are also following uh opinions of other large developers and we see quite a broad I would say.
A uh, um, projection that uh, uh, there will be a positive situation with regard to start of construction.
No, that's fair. We're hearing something similar from others as well, uh, but but secondly just on, uh, 1 house keeping on the IPC sales looks like 728 million dollars for this year. Um, it was a reduction from a previous estimate or how do you think about that ITC sales, revenue contribution? Um, uh, next year,
Previously looking for, if I understand your question correctly, we were previously looking for tax benefit contribution of between 60 to 80 million. And this uh, has now uh, turned to 70 to 800 million. So the the range has slimmed down just a bit. Yeah, and mohab just to compliment uh the other my previous answer, it's important near just refer me to the fact that, uh, 405 major projects that are supposed to, uh, become operational on our portfolio. Uh, will do so, uh, or a plan to do so. Before the end of 27, meaning that even if start of construction, uh, criteria is moving or something, we still have the protection of the end of 27. So we are in a very good situation.
Oh, that's good. Thank you.
Thank you. We will now take the next question.
From the line of David, pass from Wolf, please go ahead.
Yeah, thank you.
Just um, see you over. Want to make sure I heard you correctly. Um, that is started construction and I believe employees, or maybe you said that you received all the necessary studies and interconnection in the queue and all the other required approvals. Is that correct?
Jared, would you like to take it?
Yeah, is this relation to a specific project or in general?
Um, Arizona.
Ah, thank you. Um, seal bar. We
We are working through still the what I would call Pre and during constructions we have officially Safe Harbor, the project through various mechanisms, through startup, construction roads and also Transformers, We are in the final stages of the interconnection.
process and we expect to start full mobilization of construction later this year in quarter,
Okay. Any sense of when you get that final interconnection,
yeah, that is a
Yep. That that's expected for this year.
This year, okay.
All right, and then secondly, just switching subjects. Um, what, what is your plan for your? I believe you still have the PGM assets, uh, particularly the, um,
Blackwater project which I think is about 720 megawatts and 1.2 gigawatt hours and it's pretty Advanced. Are you do you have any plans for the that project or the overall portfolio in pjm?
Yeah, so I I I will start. And of course, Jared if you want, please compliment me. So of course, we are still developing the portfolio on PGM.
Uh, of course until project is fully permitted. Uh, so we are, you know, still under the development phase. Uh, we believe that we have a good portfolio there, and we are quite optimistic that it will create value for us Jared.
Same we have a a world-class team in tjm, they are a part of the community and we're we're working through the permitting processes there at Blackwater as well as the rest of the portfolio on pjm. So we are going to continue their development. Their work towards uh work towards a permit and uh, you know,
Continue to have the the expansion of what we see across the rest of the country in pjm as well.
Great. If I could speak 1 more and then just you give us these um run rates revenue and income. Um
very helpful appreciate that any other costs or expenses that we should be mindful of as we project outwards. I don't know on an annual basis development costs, or other things that you could give us a run rate for for those thank you.
Yeah, so, uh, we believe that uh, the road map and the details. We provide are very comprehensive. So the idea is that it will allow you to construct your models and Analysis. Of course, uh, if some assistance is required, uh, you know, we can be, uh, in touch with the team. Uh, but you know, there is no any material, uh, you know, data that is different from what you see.
Great. Thank you. Yep. If you refer to any, you know, other component in the pns, so we we expect that to be increased in a in a lower.
Increase proportion to the revenues and other and D beta as well.
Understood great. Thank you so much.
Thank you.
There are no further questions at this time. I would like to turn the conference back to Jonah ways for closing remarks.
Thank you very much. Everyone for joining. I will speak with you next quarter. Take care.
This concludes today's conference call, thank you for participating. You may now disconnect
That is it, right?