Irish energy trader Erova’s profit falls to 5.7 million euros

Profit after tax of Dublin-based energy trading provider Erova Energy – which was co-founded by two former ESB executives – fell to €5.7 million last year from €8.5 million last year, new accounts filed for the business show show .

Energy trading business revenue increased last year from EUR 91 million in 2020 to EUR 293 million due to continued increases in wholesale energy prices.

It focuses on providing risk and reward optimization of renewable energy technologies. It has also increased its presence in the UK offshore wind energy market.

Erova was co-founded in 2015 by its Managing Director Michael Brennan and Commercial Director Fergal O’Donnell.

Mr. Brennan worked for ESB as a proprietary trader and analyst, while Mr. O’Donnell managed the parastatal company’s thermal fleet, renewable energy and interconnectors.

Until 2018, Erova was owned solely by the co-founders, as well as a UK financier and Swiss private equity firm Seren.

A sales process for Erova was started in mid-2017 by the consulting firm Jones Lang LaSalle.

In 2018, Japanese corporate giant Mitsui acquired a significant stake in the Irish company. It now owns 35 percent of the business.

Last year, Erova paid a dividend of 2 million euros to shareholders, followed by a dividend of 3 million euros in 2020.

The latest accounts for Erova point to the impact of rising energy prices over the past year.

“The historic commodities rally has been felt most severely in the UK utilities market, causing over 30 UK electricity and gas suppliers – as well as the largest provider of gas transport services – to fail,” the statement said.

The company said it implemented an internal credit scoring system in 2020 to set limits, monitor and report bilateral credit exposures.

“This system, combined with responsive settlement processes, has helped Erova minimize the risk of two counterparty defaults in the UK utility market,” the statement reads.

They add that Erova has secured an extended credit facility with a major house bank, giving the company more liquidity if needed as “further credit events in the energy market become more frequent.”

Last month another Irish energy trading company, ElectroRoute, was taken over entirely by existing shareholder Mitsubishi in a multi-million euro deal.

The Japanese group already owned nearly 65 percent of the company after acquiring a majority stake in 2016.

Headquartered in Dublin, ElectroRoute was founded in 2011 by executives including its Managing Director, Ronan Doherty, and employs 90 people across Ireland, the UK, mainland Europe and Japan.

Profit after tax increased from €5.8 million in 2020 to €7.3 million last year.

Separately, wind power provided 21 per cent of Ireland’s electricity in July, new figures released this morning show. Wind has supplied 34 per cent of Ireland’s electricity since the beginning of the year, according to data from Wind Energy Ireland.

“Although figures in July are lower than previous months, this is in line with seasonal expectations,” said Wind Energy Ireland CEO Noel Cunniffe. Irish energy trader Erova’s profit falls to 5.7 million euros

Fry Electronics Team

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