“In the first nine months of 2024, Simtel focused on developing large-scale projects aimed at significantly expanding the company's capabilities and presence in the renewable energy market. The projects currently underway this year are five times larger than those from 2023. As a result, Simtel's transition in 2024 towards a business model adapted to large-scale projects also implies an adjustment of financial indicators, with the notable drop in net profit representing a natural stage in this transition. These projects involve different implementation and billing dynamics, meaning that revenue collection is mainly achieved in the second half of the financial year as projects are completed and billed to beneficiaries. This strategy allows the company to tackle large-scale projects, though it temporarily affects profit levels during implementation. In the long term, this strategic approach will allow us to consolidate our position in the renewable energy market and bring added value to our shareholders,” stated Mihai Tudor, CEO and Executive Board Member of Simtel Team.
In terms of operational revenues generated by the entities within the group, Simtel Team S.A. recorded RON 122.2 million, GES Furnizare SRL – RON 33.6 million, Simtel Moldova SRL – RON 6.5 million, and ANT Power Energy SRL – RON 6.5 million.
Regarding the progress of its own photovoltaic parks, in the first nine months of 2024, Simtel acquired two projects ready for construction, Salonta and Iacobeni. The Salonta photovoltaic park is already implemented, and for the Iacobeni park, with a planned installed capacity of 5.38 MWp, the company is finalizing construction works. Currently, Simtel holds seven photovoltaic park projects which, upon completion, will have a total installed capacity of over 80 MWp and generate an annual output of over 108 GWh.
Alongside the development of its own photovoltaic parks, Simtel has also begun building a portfolio of energy storage parks, aiming to consolidate its position in renewable energy. These parks are an essential element in the transition to a sustainable and efficient energy system. Compared to the first half of 2024, when the company had four energy storage parks, as of September 30, 2024, Simtel owned five such parks with a total storage capacity of approximately 200 MWh. The company expects some of these to be implemented in the second half of 2025, with the remainder by 2026.
Regarding the energy supply activity conducted through GES Furnizare SRL, a company in which Simtel Team S.A. holds a 62% stake, the activity is secured with contracts already in place for both energy procurement and supply for 2024. The company estimates that year-end revenue will exceed 60 million lei. In 2025, GES aims to double the volume of energy supplied.
Concerning the 2024 Revenue and Expense Budget, while its completion is approaching the established objectives, certain logistical and implementation aspects impacted the planned cash collection for Q4 2024. Specifically, several major projects at various stages of implementation faced unforeseen delays due to factors beyond the company's control, such as the delivery of critical components for grid connection, affecting billing and cash collection stages. Payments related to these projects will be made in the first quarter of 2025. These delays do not reflect operational performance issues but are a consequence of the specific execution pace for large-scale projects that the company is managing with the expansion of its activities.
“Considering this context and the adjustment of revenue timing, for 2024, we estimate a consolidated revenue growth of 23% compared to the previous year, reflecting an achievement of the revenue and expense budget for this year at 91% of the initial estimates. Even with these adjustments, the financial performance for 2024 will be solid, reflecting a strong foundation for accelerated growth in 2025. The level of sales orders recorded in 2024 is at an all-time high, and we estimate a significant volume of new orders will be added by the end of the year. These temporary delays reflect Simtel's strategic transition in 2024, providing us with the necessary base for accelerated growth next year,” added Mihai Tudor.
Additionally, it is important to underline that the first nine months of the year represented a period of learning and adjustment for Simtel's operating model, considering the unique dynamics of larger-scale projects, exceeding over 25 MWp. In this context, the company restructured both its management and technical teams, which needed to learn and adapt to new challenges and requirements. Due to these measures, the company's teams are now prepared and equipped to handle large-scale projects without facing significant limitations. This dynamic in large-scale projects is expected to continue through 2050, providing solid long-term prospects for the company. Additionally, as of 2025, the management aims for Simtel to start performing in international markets as well.
Simtel Team is listed on the Main Market of the Bucharest Stock Exchange as of August 12, 2024, and trades under the symbol SMTL.
