ABO Energy GmbH & Co. KGaA
ABO Wind AG: Successful first half year reported

The consolidated financial statement for the first half of the year underlines the good development of ABO Wind AG. “We are on track to achieve the profit forecast for the full year,” said CFO Alexander Reinicke. In 2022, the company generated a net profit of more than 20 million euros for the first time. This will most likely also be achieved in 2023. In the first half of the year, the surplus was 8.9 million euros (same period last year: 9.6 million euros). “For the full year, we continue to expect a result in the range between 22 and 26 million euros – that is to say at the level of the record profit of 24.6 million euros achieved in the previous year.” Like previous reports, the 2023 half-year report is only available in German on the company’s website.

Especially the turnover has significantly increased in the first half of the year: At 130.7 million euros, the turnover exceeded that of the same period of the previous year (98 million euros) by around one third. At 71.3 million euros, the turnover from construction services was particularly higher than in the first half of 2022 (44 million euros). The brisk construction activity is also reflected in the increase in the cost of materials ratio to 51 per cent (first half of 2022: 48.3 per cent).

ABO Wind has further expanded the portfolio of projects under development. The company is currently working on renewable energy and battery storage projects with a total capacity of 22.2 gigawatts (GW). Since February, the pipeline has grown by five percent. The increase is particularly significant in Germany (from 2.8 to 3.4 GW). The figure reflects the growing willingness of municipalities to make land available for the use of renewable energies. With a total of 700 megawatts of newly acquired project sites for wind power capacity in Germany, the company’s original target for the year 2023 was already exceeded by mid-year. With the reports for the full and half financial year, the company also updates the status of the development pipeline broken down by country and maturity level.

In addition, the company’s second pipeline of renewable energy projects under development has grown to around 20 gigawatts. However, these wind and solar projects will not have access to the electricity grid in the foreseeable future. They are linked to the production of green hydrogen. Policymakers and industry leaders are very interested in building a hydrogen economy to enable decarbonisation of chemical and steel production or shipping, for example. “In countries like Canada, Argentina and South Africa, we are developing sites that are predestined to produce green hydrogen at competitive prices,” says Board Spokesman Dr Karsten Schlageter. The goal is to convert some of this hydrogen into more easily transportable green ammonia and then export it to Germany, for example. When securing locations, ABO Wind pays attention not only to good wind conditions but also to access to ports. The hydrogen activities are shown here. “We are making good progress with these projects,” says Dr Schlageter. But the economic and technological hurdles are higher. In addition, the 20 gigawatts of the hydrogen pipeline are spread over only a dozen projects.

The standard pipeline of 22 gigawatts, on the other hand, consists of about 800 projects under development. If some of these projects turn out not to be feasible, which happens regularly, this will not have a serious impact. “This large and valuable pipeline is a meaningful indicator of our good prospects,” says Dr Karsten Schlageter. “This is the basis for our expectation to continue to significantly increase the company’s profit in the coming years.” In many markets, the political efforts to make more land available for renewable energy projects and to accelerate the approval processes are currently noticeable. “In all likelihood, we will benefit from this not only in the short term, but over many years,” says Managing Director Schlageter. The hydrogen projects offer additional potential.

To make the most of the opportunities in the coming years, the Managing Board hopes the Extraordinary General Meeting scheduled for 27 October will resolve to change the company’s legal form to a so-called Partnership Limited by Shares (KGaA). The formal decision by the Managing Board and Supervisory Board to put the issue on the agenda is still pending. Once approved, it makes sense to have shareholders vote on the proposal on this occasion, since an Extraordinary General Meeting will have to take place on October 27 anyway. Due to the growth, the One-Third Participation Act now applies to ABO Wind. Accordingly, one third of the Supervisory Board will consist of employee representatives in the future. This shall be implemented at the upcoming General Meeting.

The Managing Board is convinced that the intended new structure will bring considerable advantages to the company and thus to all shareholders in the medium and long term. “At ABO Wind, strategic and long-term considerations form the guiding principle of action. This has proven its merit over the years,” says Dr Schlageter. “Dr Jochen Ahn and Matthias Bockholt stand for this, as does the entire Managing Board.” The development of renewable energy projects is complex and arduous. The success of the business model depends on the long-term strategic orientation and the industry knowledge of the founders, and respectively, the decision-makers. Another essential aspect is the company’s character as a family business. This is guaranteed at ABO Wind because so far, the Ahn and Bockholt families have held more than 50 percent of the votes at the General Meeting. This means that the founders indirectly influence who runs the business. In the case of further capital increases, this influence, which is important for the success of the company, would decrease.

“Only a change of legal form into a KGaA decouples the influence of the founders and their families from their majority at the General Meeting,” says Dr Schlageter. Since the Managing Board does not want to jeopardise the competitive advantage as a company shaped by the founders, capital increases would only be possible to a limited extent without a change of form. “We have ambitious goals and want to make as large a contribution as possible to a speedy energy transition,” emphasises Dr Schlageter. “If we can continue to use the equity capital market in the future, the potential for a sustainable increase in earnings per share will grow at the same time.” Therefore, the Managing Board is working to bring the change of legal form to a decision-making stage and is counting on the necessary three-quarters majority of the shareholders to endorse the proposal at the General Meeting.