A good 1Q for Acwa Power: Saudi Arabia's renewable energy utility Acwa Power reported a 78% y-o-y rise in net income in 1Q 2023 to SAR 270 mn, a disclosure to Tadawul showed. Its revenues were up 16% y-o-y during the quarter to SAR 1.3 bn, it added.

A reason or two: The growth came mainly due to a higher operating income before impairment and other expenses on the back of a higher contribution from existing and new projects, Acwa said. “These were partially offset by lower contributions from development and construction management services fees earned for projects and higher general and administrative expenses in line with business growth,” it added. A lower zakat and tax charge also contributed to the growth after the recognition of a deterred tax credit on account of FX fluctuations in Morocco.

There was a bit of a downside: The increases in net income were somewhat offset by higher finance charges on the back of increased finance costs due to higher market interest rates and increased finance costs from additional debt related to the second tranche of sukuk issued by the company in February, it added.

Some progress during the quarter: Acwa Power said it “achieved significant milestones on the business development landscape during the first quarter of 2023,” according to an earnings release.Those include three power purchase agreements (PPA) with Uzbekistan for three solar PV plants with combined capacity of 1.4k megawatt alternating currency (MWAc) and battery energy storage systems with an overall capacity of 1.5k MWh. It also announced the signing of a water purchase agreement (WPA) with the Saudi Water Partnership Company for the development and operation of a water desalination plant using reverse osmosis technology with a capacity of up to 600k cbm/day at the south of Rabigh city.

Quite an eventful quarter: Two dry financial closes were also achieved during the quarter, including a SAR 24 bn financing for smart city NEOM’s green hydrogen project, which is set to be “the world’s largest at-scale green hydrogen production project.” Three other projects, including Jazan Integrated Gasification Combined Cycle project’s Group 2 assets, Noor Energy 1’s 300 MW two units, and Jazlah Independent Water Plant, also began commercial operations during the quarter.