Kuala Lumpur, 30 May 2024 – Regional clean energy expert, Solarvest Holdings Berhad (“Solarvest” or the “Group”) has today announced its fourth quarter (“4QFY24”) and twelve months financial results for the period ended 31 March 2024 (“FY24”).
FY24 marks the second consecutive year of record-breaking financial performance for Solarvest, as revenue grew by 34.8% year-on-year (“YoY”) to RM492.6 million from RM365.5 million attained in the previous financial year (“FY23”). Meanwhile, profit after tax and non-controlling interest (“net profit”) soared by 64.1% YoY to RM32.3 million from RM19.7 million recorded in FY23. Net profit margin stood higher at 6.5% as compared to 5.4% in the previous year.
The impressive growth was driven by higher revenue contribution from Large Scale Solar 4 (“LSS4”) projects, strong performances in the commercial and industrial (“C&I”) segments, as well as the profitability of asset development projects. These achievements highlight the effectiveness of the Group’s five-year strategic roadmap, leading to record-high profit margins and successful diversification of revenue sources beyond engineering, procurement, construction, and commissioning (“EPCC”) contracting.
In 4QFY24, Solarvest’s revenue stood at RM96.90 million from RM113.22 million in the preceding year’s quarter (“4QFY23”), primarily due to the completion of most LSS4 projects. Despite the decrease, the Group’s net profit climbed 48.1% YoY to RM7.7 million in Q4FY24 as compared to RM5.2 million last year, contributed by the lucrative asset development projects under Powervest and electricity sales from Solarvest’s three self-owned LSS4 plants.
Breaking it down by revenue segment, we continue to see the EPCC segment remain as Solarvest’s main revenue contributor, accounting for RM449.7 million or 91.3% of the Group’s revenue, growing from RM355.7 million or 97.3% recorded in FY23. The adjustment in its EPCC ratio signifies a step closer in achieving its 5 years plan to attain 30% recurring income.
In regards to recurring income, the Group’s electricity sales segment surged by six-fold YoY to RM12.0 million from RM1.9 million in FY23, following the successful commissioning of all three self-owned LSS4 assets, which commenced commercial operations during the year. FY24 captured initial contributions from the LSS4 assets, with full-year impact to be recognised in FY25.
Reflecting on Solarvest’s commitment in growing its new sustainable solutions, its other segments—comprising solar project development, environmental commodities trading and other green energy solutions—have grown more than 7 times to reach RM24.0 million in FY24 from RM3.2 million in the prior year. While the operations and maintenance (“O&M”) of solar energy systems segment accounted for the remaining 1.4% of revenue, contributing RM6.9 million, up from 4.7 million last year.
Executive Director and Group Chief Executive Officer of Solarvest, Mr. Davis Chong Chun Shiong (张俊雄) said, “FY24 was a landmark year for Solarvest, marked by our record-breaking financial performance and the successful completion of all eleven LSS4 projects, totalling 208.0 megawatts peak (“MWp”). Of these, eight were awarded to us as the EPCC contractor and three as the asset owner.”
“Our prospects for the EPCC segment remain bright as we are strategically capitalising the awards of the Corporate Green Power Programme (“CGPP”), which will include projects totalling 443.4 MWp and potential revenue of over RM1.0 billion. These projects will be reflected in our order book by Q2FY25 to Q3FY25.”
Building on its successful LSS4 approach, Solarvest also plans to pursue ownership and development opportunities alongside bids for EPCC contracts in the upcoming LSS5 programme.
“Our team is all set for the LSS5 bidding which has a total quota of 2.0GW. Our extensive tendering experience and successful project track record in LSS4 has put us in the greatest position to get the best out of LSS5. Coupled with the additional 800 MW quota allocations under NEM 3.0[1] and NEDA[2], it presents massive project opportunities to expand and strengthen our business pipeline.
Under the sale of electricity segment, FY25 will see the full-year contributions from Solarvest three self-owned LSS4 assets at RM 23 million per annum. On top of that, the cumulative capacity of 109.0 MWp under Powervest corporate power purchase agreement are projected to generate annual revenues of RM38.0 million, upon full completion within the next 12-18 months.
Moving forward, Solarvest remains confident about its prospects as government kickstarts the preparation of the National Energy Transition Roadmap (“NETR”) flagship projects which present further avenues for growth. The establishment of Energy Exchange Malaysia (“Enegem”) also opens the door to cross-border electricity trading with neighbouring countries, positioning Malaysia as a regional energy hub. We anticipate higher returns from the renewable energy (“RE”) export market to incentivise local RE infrastructure, benefiting the entire RE ecosystem.
In April 2024, Solarvest announced a Proposed Private Placement with expected gross proceeds of up to RM56.7 million. The bulk of the proceeds, RM40.5 million, are earmarked for capital expenditure on CGPP and C&I rooftop solar projects. Scheduled for completion by the second quarter of 2024, this exercise is anticipated to bolster Solarvest’s asset investment capabilities and generate further opportunities within the EPCC sector, thereby driving business expansion.
On a related note, Solarvest is planning for an internal restructuring to enhance its RE asset investment capabilities, facilitated by an upcoming fundraising initiative.
“Through this upcoming strategic fundraising, we will be better equipped to pursue the robust project opportunities of 6.1 gigawatt-peak (“GWp”) tenderbook, strategically distributed across Malaysia and overseas markets at 4.0 GWp and 2.0 GWp, respectively. This asset investment is expected to foster additional EPCC opportunities capitalising on the heightened project capability, allowing Solarvest to enter into a bigger game with strengthened core competencies. This will be leading our company into a lucrative expansion in Malaysia and overseas markets. Our plan to focus on regional expansion in FY25 is expected to replenish our regional order book with an approximate of 200 MW overseas projects.”
As of 31 March 2024, Solarvest’s unbilled order book stood at RM242.0 million.