We are committed to providing transparent
communication to shareholders, thus the inclusion this
year of a Finance Review in our Annual Report. The mix
of our businesses, spanning from project development
to operations, combined with varying shareholding
levels, controlling interests, joint venture arrangements,
etc., means that our results at a glance can appear
somewhat complicated. This Finance Review is
intended to supplement the Chief Executive and
Chairman’s Reviews and to provide further explanation
to shareholders of our results and the underlying
accounting treatments adopted in respect of significant
items in our annual accounts, the funding of the Group
and our management of business risk.
On an overall basis, Group revenue was stable year on year. At €327.0 million, revenue was marginally lower than 2011, down €2.4 million (1%). Included in the 2011 results is €12.1 million of revenue relating to Roads assets which were disposed of during that year and which, if excluded, would reflect a revenue increase, on a like-for-like basis, of €9.7 million (3%).
EBITDA is one of the key metrics by which we judge the performance of our operating subsidiaries. EBITDA from continuing operations doubled from €8.7 million in 2011 to €17.4 million in 2012. This reflects growth in earnings in Wind of €6.7 million, reflecting a full year’s contribution from the Lost Creek wind farm; lower losses recognised in respect of Roads, contributing a €9.6 million increase in earnings; a reduction in central costs, contributing €10.2 million; offset by a contraction in earnings in Waste of €17.7 million. Earnings in Waste were impacted by significantly reduced prices for recyclables in the second half of the year, the planned closure of the KTK landfill in Ireland, and price pressure driven by below-cost selling by landfills in Ireland.
Although impairment charges were reduced from last
year, total impairment charges (on continuing and
discontinued operations) of €64.2 million (2011: €195.7
million) were recognised in the current year and are
commented on in greater detail below.
Other operating income for the year was €3.7 million (2011: €22.5 million), with 2011 including a €20.3 million profit on the disposal of certain of the Group’s Roads businesses.
Share of losses from joint ventures of €1.0 million is €6.7 million lower than last year due to the discontinuation of recognition of losses from CRG Waterford and CRG Portlaoise following the impairment of these assets, which are now fully impaired. Traffic levels for CRG Portlaoise are slightly behind plan while those for CRG Waterford are significantly behind plan.
Net financing costs decreased by €10.8 million (33.1%) to €21.9 million in the year, mainly due to lower tax equity related financing costs in Wind Capital Group and the positive impact of net foreign exchange gains.
Profit from discontinued operations of €46.3 million (2011: loss of €214.9 million) arose from the release of provisions no longer required in respect of the sale of Airtricity (€25.3 million) and the de-recognition of Solar liabilities (€60.5 million), offset by a loss on the disposal of part of the Group’s shareholding in Green Plains Renewable Energy, Inc. (€39.1 million). The sale of these shares generated proceeds of US$99.9 million for the Group.
Taking all of these items into consideration, the resulting loss for the year decreased to €88.8 million from €381.0 million in 2011. The loss attributable to equity holders was €109.4 million (2011: €280.2 million).