SolarPack

SolarPack – BME:SPK

Company Background: 

Solarpack is a small-cap specialized in the construction, development, operation and maintenance of solar photovoltaic power plants. Its headquarters are in Spain. However, Solarpack also has a presence in the rest of Europe, North America, Latin America, Asia and Africa.

It was founded in 2005, and its IPO was in 2019

Company data (07/06/20)
Market Capitalization470 mill €
Revenue FY1982.8 mill €
 EBITDA36.1 mill €
Debt227 mill €
P/E25.96

What is the business of the company:

Solarpack is an independent power producer, it develops solar photovoltaic projects from the beginning. The company offers financing, operation, maintenance, power generation and asset management services 

Why it is an interesting company?

  • Solarpack is in a sector which is growing quickly
  • It has presence over 4 continents
  • It has an interesting business model where it combines build to own with build to sell
  • 1Q20 were the best financial results of its history
  • It is backed by an important Private Equity firm (Ardian)
  • Strong presence in important emerging markets such as India & Chile

Current situation: 

  • 450 MW operated (Spain, Peru, India, Chile)
  • 239MW under construction (Spain, India, Chile)
  • Strong pipeline
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Financial review: 

SolarPack has 4 segments: Development & construction + Power Generation + Services + Corporate 

Total EBITDA 1Q20 = 17.2 (+208% vs 1Q19)

Devcon: 4.1M€ (19.4% margin)

PowGen:12.9M€ (88% margin) This is the important one as it is backed by PPA contracts (25 years)

Services: 0.4M€

Corporate: -0.3M€

Earnings Trends*

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*Data from Bloomberg

Conclusion

It is an interesting company which is forecasted to grow heavily during the next year. Currently, its P/E ratio is not cheap. However, we believe that it is worthy of following. It is in an interesting sector, it is well managed, and it can be interesting to consider at an attractive price.

Guidance

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