Generating 100 percent renewable energy at its solar and wind power plants, Galata Wind completed the first nine months of 2021 with successful operational and financial results. As a Doğan Holding company, Galata Wind increased its consolidated revenues by 33.1 percent year-on-year to TRY 331 million, while also increasing EBITDA by 27.2 percent to TRY 251 million. Galata Wind's net profit for the period was around TRY 93 million.
As a Doğan Holding company, the 100 percent renewable energy company Galata Wind increased its consolidated revenues by 33.1 percent to TRY 331,194 in the first nine months of 2021 (2020: TRY 248,826). The two most important factors in the revenue growth were the increase in electricity sales prices and the 14.7 percent year-on-year output increase to 530,778 MWh, which was achieved in the first nine months (2020/09: 462,876 MWh) with the contributions of the Taşpınar WPP.
Galata Wind increased its consolidated gross profit by 23.1 percent year-on-year to TRY 224,127 (2020/09: TRY 182,022), while increasing its Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) by 27.2 percent to TRY 250,507 (2020/09: TRY 197,000). Galata Wind's net profit for the period was TRY 93 million.
The increase in EBITDA was mostly due to the 14.7 percent year-on-year output increase, the increase in electricity sales prices in parallel with increasing exchange rates, the increase in sales revenues of verified emission reduction credits and the increase in gross profit. In the first nine months of 2021, we recorded a net profit of TRY 92,785 (2020/09: TRY 98,623) thanks to the improvements in the exchange difference expenses on loans, and financial expenses being less than the previous year.
Galata Wind generated TRY 218,298 in cash from its operations in the first nine months of 2021 (2020/09: TRY 210,417), demonstrating its strong cash generation potential. The Company also reported retained earnings of TRY 262,187 on its balance sheet as of September 30, 2021. Building on these retained earnings and stable cash flow, Galata Wind aims to pay regular dividends every year. Click on the link below to see Galata Wind's dividend policy.
The sales revenues of the Company’s verified emission reduction (VER) credits increased sevenfold year-on-year from TRY 1,013 to TRY 7,184. The company will continue to generate revenue from the verified emission reduction credits earned through the generation activities at its power plants in the last quarter of 2021.
The Paris Agreement adopted within the scope of the UN Framework Convention on Climate Change was ratified by the Grand National Assembly of Turkey on October 7, 2021, bringing significant momentum to global carbon emission markets. In line with the global developments, the value of the verified emission reduction credits held by Galata Wind increased by about 5.5 times since the beginning of 2021, an increase that is expected to extend well into the future. The Company is able to earn verified emission reduction credits because it generates electricity from renewable energy sources, and it will continue to sell these credits for additional revenue.
With all its turbines commissioned on March 25, 2021 and the electricity selling at a price of $94/MWh (including local content price) within the scope of the Renewable Energy Support Scheme (YEKDEM), Galata Wind's Taşpınar WPP generated 15,598 MWh of electricity in the first quarter, 27,266 MWh in the second quarter, and 46,809 MWh in the third quarter of 2021. As summer is the windiest time of the year in Turkey, the generation output of the Taşpınar WPP, which is still in its first year of operation, is in line with the Company's projections.
The Company's plan to build the Taşpınar WPP Hybrid Solar Power Plant (SPP) with an installed capacity of 42.58 MW was approved with the Energy Market Regulatory Authority's decision dated August 5, 2021 and numbered 10345-3.
Having a projected investment cost of about $27 million, the Taşpınar Hybrid SPP project is expected to start by the beginning of 2022, after procuring the necessary permits, including those for EIA, zoning and expropriation. The plant is expected to be completed and commissioned in 2022. Just as with the Galata Wind’s Taşpınar WPP, the electricity generated at the SPP will be sold at the prices set by the Renewable Energy Support Scheme (YEKDEM) ($94/MWh until the end of 2025; $73/MWh between 2026 and 2030), which is expected to have a positive impact on the Company's revenues.
With the capacity increase achieved at Galata Wind's Mersin WPP in May 2021, the installed capacity (MWe) of the plant was increased from 51 MW to 56.85 MW. From the impact of the wind regime and the increase in capacity, a year-on-year output increase of 31.3 percent was achieved in the third quarter of 2021 (2021/Q3: 73,745 MWh, 2021/09: 174,770 MWh). The additional output is expected to contribute to the revenue in the upcoming period.
The Company's operating revenues, improved gross profit and increased output are all key performance indicators that demonstrate the success achieved in the first nine months of 2021. In the third quarter (summer), the windiest time of the year, the wind power plants in Şah, Mersin and Taşpınar were operated at a capacity utilization rate of about 41.8 percent, which is above the average in Turkey. In the same period, the average capacity utilization rate in Turkey was 38.4 percent. Provided that the current level of performance is maintained in all power plants of Galata Wind, performance in the last quarter will also be in line with the expectations, since this period will be very windy as well.
Meanwhile, Galata Wind continues to evaluate domestic and foreign investment opportunities from a broad perspective.