81 diverse projects in ACWA Power’s portfolio; non-recurring gains pull down Q4 profit YoY: Exec

Ozgur Serin, VP Head of Investor Relations at ACWA Power

ACWA Power holds a diverse portfolio of 81 projects with a total investment cost of SAR 318 billion, Ozgur Serin, VP Head of Investor Relations at ACWA Power, told Argaam.

The company has 41 projects in operation, with a total electricity generation capacity of 30 gigawatts (GW) and a water desalination capacity of up to 5.5 million cubic meters per day (MSCMD). In addition, there are 19 projects under construction and 21 in advanced stages of development.

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Serin said that ACWA Power is the largest private desalination company in the world, with water desalination capacity of 7.6 MSCMD. Its total electricity generation capacity of all projects stood at 55.1 GW.

The company seeks to maintain its leadership position in all the markets where it operates, as its market share in the electric power generation field in the main markets ranged between 20-35%. Similarly, it is the largest private water desalination company in the world with a market share ranging between 20-45% across Gulf markets.

He pointed out that the Kingdom represented about 55-60% of the total investment cost, followed by the UAE and Uzbekistan at 13% and 10%, respectively.

ACWA Power reported that about 70-80% is being hedged to mitigate the impact of rising interest rates at the group level, including investment portfolio debt.

The company began work on its second green hydrogen project, in Uzbekistan, and the construction will begin soon. It also has other green hydrogen projects under development in Indonesia and Egypt.

Serin highlighted that 2023 showed a positive performance financially, despite lower profits in Q4 2023 year-on-year (YoY).

The YoY decrease in Q4 profits was attributed to one-time capital gains in Q4 2022. However, the net profit in Q4 2023 jumped 46% quarter-on-quarter (QoQ) to SAR 580 million.

The company distributed cash dividends of SAR 1.2 billion, since listing, during 2021 and 2022. Meanwhile, the board of directors recommended making a cash and non-cash distribution via bonus shares for 2023, to improve the company’s sustainability and support the growth plans that require mega investments.

ACWA Power focuses on growth strategy to boost the value of managed assets from more than $84 billion in 2023 to about $250 billion by 2030.

The growth plan is projected to start during the current year, as the company finalized the financial closure of the Hassyan IPP in the UAE by the end of February.

Serin expects that ACWA Power will likely suffer quarterly fluctuations due to the nature of business model. So, the company will not comment on quarterly performance expectations.