UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13A-16 OR 15D-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of March 2023

 

Commission File Number: 001-41613

 

Enlight Renewable Energy Ltd.

(Translation of registrant’s name into English)

13 Amal St., Afek Industrial Park

Rosh Ha’ayin, Israel

(Address of principal executive office)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F ☒        Form 40-F ☐

 

EXPLANATORY NOTE

On March 15, 2023, Enlight Renewable Energy Ltd. issued a press release titled: “Enlight Renewable Energy Reports Year-End 2022 Financial Results”. A copy of the press release is furnished as Exhibit 99.1 herewith.

EXHIBIT INDEX

The following exhibit is furnished as part of this Form 6-K:

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

ENLIGHT RENEWABLE ENERGY REPORTS

YEAR-END 2022 FINANCIAL RESULTS

 

All of the amounts disclosed in this press release are in U.S. dollars unless otherwise noted

 

TEL AVIV, ISRAEL, March 15, 2023 – Enlight Renewable Energy Ltd. (NASDAQ: ENLT, TASE: ENLT) today reported financial results for the full year ended December 31, 2022.

The Company’s annually earnings materials and a link to the earnings webcast, which begins today at 8:00 AM ET, may be found on the investor relations section of Enlight’s website at https://enlightenergy.co.il/data/financial-reports/

“We delivered record results in 2022, with revenue up 88% and Adjusted EBITDA^* up 96% demonstrating our deep track record of converting projects under development through to construction and operations. We succeeded in bringing over 800 MW to operation, commenced construction on 630 MW of generation and 1.7 GWh of energy storage, and expanded our overall Mature Project portfolio¹ by 0.9 GW. The entirety of our Mature Project portfolio, including 4.5 GW of generation and 2.7 GWh of energy storage globally, is expected to reach commercial operation by the end of 2025, providing us with a clear path on the future of our business”, said Gilad Yavetz, CEO of Enlight Renewable Energy.

 

“Enlight is a global renewable energy leader with operations and projects in the United States, Europe and Israel. We have been a top performing publicly traded company in Israel for the past decade and we believe the proceeds from our recent initial public offering in the United States will accelerate our growth, particularly in the United States, where, to our knowledge, we are now the first publicly traded pure-play greenfield renewable energy developer,” Yavetz added. “With the passage of the Inflation Reduction Act in the U.S. and a supportive regulatory backdrop in Europe, we believe we are well positioned to deliver both rapid growth and above-market project returns. We are therefore increasing our annual project deployment guidance from 2026 and beyond to 1.5 GW per year, as we believe we are very well positioned to strategically capture the largest and most attractive renewable energy opportunities across our markets.”

 

---

 

Highlights

 

 

 

 

 

 

 

 

Overview of Financial and Operating Results

 

Revenue

 

---

For the fourth quarter of 2022, the Company’s revenues increased to $61m up from $35m in the same period in 2021. The growth was mainly driven by the addition of new projects, including Gecama, Emek Habacha and Selac, which contributed an additional $32m in the fourth quarter and the recognition of all proceeds from the sale of electricity by the Halutziot project as revenue following its reclassification out of Financial Asset, which contributed an additional $2m to revenue in the fourth quarter. These positive impacts were partially offset by lower production and non-recurring events which reduced availability of the facilities, which had a $6m impact, and weaker currency exchange rates (“FX”), which had a $3m impact. In addition, we sold $2m of electricity in projects treated as financial assets in the quarter, which under IFRS we are required to account for as financing income or other non-P&L metrics.

 

For the full year 2022, the Company’s revenues were $192m versus $102m in the full year 2021. The increase in revenue was mainly driven by the addition of new projects, which contributed an additional $86m, the reclassification of Halutziot, which contributed an additional $12m, and $2m from power purchase agreement (“PPA”) inflation indexation. These positive impacts were partially offset by lower production and certain events which reduced availability, that had an $8m impact and weaker FX which had a $6m impact. In addition, we sold $18m of electricity for projects treated as financial assets in 2022, which under IFRS we are required to account for as financing income or other non-P&L metrics.

 

The financial contribution of the Company’s segments is now well balanced between Western Europe, Central-Eastern Europe (“CEE”) and Israel, with 71% of revenues in the fourth quarter of 2022 denominated in Euros, 8% in other European currencies and 21% of revenues denominated in Israeli shekel. Following completion of the Company’s first project in the United States, which is expected to come online by the end of the first half of 2023, the Company’s revenue will also include substantial revenues denominated in U.S. dollars.

 

Adjusted EBITDA^*

 

In the fourth quarter of 2022, the Company’s Adjusted EBITDA almost doubled to $43m compared to $22m for the same period in 2021. The increase was driven by the same factors which affected our revenue increase in the same period.

 

For the full year 2022, the Company’s Adjusted EBITDA also nearly doubled to $130m compared to $66m in 2021. The increase was driven by the same factors which affected our revenue increase in the same period and was offset by an additional $8m from corporate overhead expenses.

 

Portfolio Overview³

 

The Company continues to accelerate the progress of its project portfolio through the conversion of Development Projects⁴ into Mature Projects and through the progression of Mature Projects from pre-construction to construction and ultimately operations.

 

 

 

 

 

 

United States

 

The Company is executing successfully across its US project portfolio. Focus continues to be progressing a large volume of projects to maturity through the development process.

 

Apex Solar (located in Montana) is progressing as planned. COD is expected by the end of the first half of 2023.

---

Atrisco Solar (located in New Mexico and totaling 360 MW solar and 1,200 MWh storage) commenced construction during the fourth quarter 2022. Major equipment is ordered and the construction agreement executed. All interconnection studies are complete. The draft interconnection agreement is underway and expected to be signed in April. The Company is advancing negotiations with financing providers (debt and tax equity). There are strong potential benefits for Atrisco under the Inflation Reduction Act (IRA), including PTC on solar tax equity and the possibility of a domestic content adder on the energy storage system. COD is expected by mid-2024.

 

The Company has made significant progress on one of the largest projects in its portfolio, CO Bar (located in Arizona and totaling 1,200 MW solar and 824 MWh storage). The initial 580MW of solar is contracted and the remaining capacity including storage is in advanced negotiation with offtakers. The project has secured its primary real estate and conditional use permit (CUP). The system impact study (SIS) is complete and the facilities study is nearing completion. CO Bar is expected to start construction in the second half of 2023 and achieve COD in phases through 2025. Like Atrisco, the CO Bar project potentially stands to benefit from the IRA, including PTC on solar tax equity and the possibility of a domestic content adder on the battery energy storage system. There is further potential to contract an additional 3.2 GWh of storage at CO Bar in the future.

 

With respect to the supply chain, the Company continues to de-risk its project portfolio. The Company executed an agreement with Waaree for up to 2 GW of modules with delivery through 2025. Together with other module procurement contracts, the Company has clarity on meeting module supply needs for its mature project portfolio in the United States.

 

Amidst increasing interconnection queue congestion across the United States, the Company continues to see strong interconnection results, which it attributes to its advanced portfolio and market specific knowledge. In the fourth quarter of 2022, the Company increased the projects beyond system impact study (known interconnection cost and timeline) by approximately 2 GW. With more than 8.4 GW of projects past system impact study, the Company believes it is positioned to accelerate its growth in the United States.

 

Europe

 

The Company continues to benefit from the significant demand for power across Europe. Despite declining natural gas prices, natural gas remains significantly above historical price levels. Moreover, the steep increase in recent months in the price of carbon, recently eclipsing 100 Euros per ton, has kept thermal generation expensive. For example, in the fourth quarter of 2022, Gecama (Spain) benefited from an average net price of 115 EUR/MWh, 82% of which was hedged.

 

Project Bjorn (Sweden), one of the largest onshore wind farms in Europe, totaling 372 MW continues to progress with 26 turbines operational (out of 60) as of the date of this release. 52 turbines are fully erected. In Sweden, the Company is able to generate revenues from the sale of electricity for operational turbines even before the project reaches full COD. The Company expects Bjorn to reach full COD by the end of the first half of 2023.

 

On the development front, Gecama Solar, a 250 MW solar and 200 MWh storage project advances as planned. With real estate and interconnection already secured, the project awaits its environmental and construction permit. Construction is expected to commence by the end of H2 2023 with COD expected by year end 2024.

 

Israel

 

In the fourth quarter the Company commenced construction on the project called Solar + Storage 2, totaling 163 MW and 328 MWh of storage. Negotiations of corporate power purchase agreements negotiations are ongoing with COD expected in 2024.

 

In addition, Genesis Wind, the largest renewable energy project in Israel totaling 189 MW has completed erection of all its wind turbines. Commissioning tests have begun with COD expected in the second half of 2023.

 

The Company also recently signed definitive agreements with NewMed Energy (TASE: MWND) and its CEO, Yossi Abu, to invest in renewable energy projects across the Middle East & North Africa. Although entering this agreement does not result in an immediate financial affect on the Company, the Company believes that there is a unique opportunity to develop attractive renewable energy projects of significant scale in the region, particularly across Egypt, Jordan and Morocco, which are markets adjacent to Enlight’s current geographic footprint (Israel and Spain).

 

Balance Sheet and Funding

 

The Company benefits from a strong liquidity position with the vast majority of its cash held in Euros or U.S. dollars. As of December 31, 2022, but including cash received in the U.S. IPO, 81% of the Company’s cash and cash equivalents was held in U.S. dollars or Euros, with a minimal exposure to the Israeli shekel. The Company has no exposure to Silicon Valley Bank.

 

2023 Financial Outlook

 

“We are pleased to introduce Revenue and Adjusted EBITDA guidance for 2023 based on our current operational portfolio and expected conversions to operations over the course of the year. We note that our Revenue and Adjusted EBITDA guidance does not include certain proceeds from the sale of electricity for our projects treated as Financial Assets. Similarly, our Adjusted EBITDA outlook does not include tax credits expected to be recognized upon COD of Apex Solar. "We benefit as a well-capitalized and diversified group, and demand for renewable energy continues to increase globally,” said Nir Yehuda, Enlight Renewable Energy’s Chief Financial Officer.

 

 

 

 

 

* The section titled “Non-IFRS Financial Measures” below contains a description of Adjusted EBITDA, a non-IFRS financial measure discussed in this press release.  A reconciliation between Adjusted EBITDA and Net Income, its most directly comparable IFRS financial measure, is contained in the tables below. The Company is unable to provide a reconciliation of Adjusted EBITDA to Net Income on a forward-looking basis without unreasonable effort because items that impact this IFRS financial measure are not within the Company’s control and/or cannot be reasonably predicted. These items may include, but are not limited to, forward-looking depreciation and amortization, share based compensation, U.S. acquisition expense, other income, finance income, finance expenses, share of losses of equity accounted investees and taxes on income. Such information may have a significant, and potentially unpredictable, impact on the Company’s future financial results. We note that “Adjusted EBITDA” measures that we disclosed in previous filings in Israel were not comparable to “Adjusted EBITDA” disclosed in the release and in our future filings.

 

•

Conference Call Please pre-register by conference call: https://register.vevent.com/register/BI6be483f1b52b4541a4c425933c76b2e3 Upon registering, you will be emailed a dial-in number, direct passcode and unique PIN.

•

Webcast Please join and register by webcast: https://edge.media-server.com/mmc/p/yjzqcnph

Non-IFRS Financial Measures

 

This release presents Adjusted EBITDA, a non-IFRS financial metric, which is provided as a complement to the results provided in accordance with the International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”). A reconciliation of the non-IFRS financial information to the most directly comparable IFRS financial measure is provided in the accompanying tables found at the end of this release.

 

We define Adjusted EBITDA as Net Income adjusted for depreciation and amortization, share based compensation, U.S. acquisition expense, other income, finance income, finance expenses, share of losses of equity accounted investees and taxes on income. Our management believes Adjusted EBITDA is indicative of operational performance and ongoing profitability and uses Adjusted EBITDA to evaluate the operating performance and for planning and forecasting purposes.

 

Non-IFRS financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for financial information presented under IFRS. There are a number of limitations related to the use of non-IFRS financial measures versus comparable financial measures determined under IFRS. For example, other companies in our industry may calculate the non-IFRS financial measures that we use differently or may use other measures to evaluate their performance. All of these limitations could reduce the usefulness of our non-IFRS financial measures as analytical tools. Investors are encouraged to review the related IFRS financial measure, Net Income, and the reconciliations of Adjusted EBITDA provided below to Net Income and to not rely on any single financial measure to evaluate our business.

 

Special Note Regarding Forward-Looking Statements

 

This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements as contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements contained in this press release other than statements of historical fact, including, without limitation, statements regarding the Company’s business strategy and plans, capabilities of the Company’s project portfolio and achievement of operational objectives, market opportunity and potential growth, and the Company’s future financial results and Revenue, EBITDA, Adjusted EBITDA and proceeds from sale of electricity guidance are forward-looking statements. The words “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “target,” “seek,” “believe,” “estimate,” “predict,” “potential,” “continue,” “contemplate,” “possible,” “forecasts,” “aims” or the negative of these terms and similar expressions are intended to identify forward-looking statements, though not all forward-looking statements use these words or expressions.

 

These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the following: slowed demand for renewable energy projects; changes to existing renewable energy industry policies and regulations that present technical, regulatory and economic barriers to renewable energy projects; electricity price volatility, unusual weather conditions (including wind and solar conditions), catastrophic weather- related or other damage to facilities, unscheduled generation outages, maintenance or repairs, unanticipated changes to availability due to higher demand, shortages, transportation problems or other developments, environmental incidents, or electric transmission system constraints and the possibility that we may not have adequate insurance to cover losses as a result of such hazards; our ability to enter into new offtake contracts on acceptable terms and prices as current offtake contracts expire; actual or threatened health epidemics, such as the COVID-19 pandemic, and other outbreaks; operational delays and supply chain disruptions or increased costs of materials required for the construction of our projects, as well as cost overruns and delays related to disputes with construction contractors; the reduction, elimination or expiration of government incentives for, or regulations mandating the use of, renewable energy; our ability to effectively comply with Environmental Health and Safety and other laws and regulations and receive and maintain all necessary licenses, permits and authorizations; a drop in the price of electricity derived from the utility grid or from alternative energy sources; receipt of necessary land use, environmental, regulatory, construction and zoning permissions we need, on favorable terms; advances in technology that impair or eliminate the competitive advantage of our projects; the impact of adverse weather patterns and climate change; the requirements of being a public company the attending diversion of management’s attention; certain provisions in our articles of association and certain applicable regulations that may delay or prevent a change of control; and the other risk factors set forth in the section titled “Risk factors” in our prospectus dated February 13, 2023 filed with the Securities and Exchange Commission (the “SEC”) pursuant to Rule 424(b), and our other documents filed with or furnished to the SEC, including our Annual Report on Form 20-F for the fiscal year ended December 31, 2022, to be filed with the SEC.

 

These statements reflect management’s current expectations regarding future events and operating performance and speak only as of the date of this press release. You should not put undue reliance on any forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that future results, levels of activity, performance and events and circumstances reflected in the forward-looking statements will be achieved or will occur. Except as required by applicable law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.

 

About Enlight

 

Founded in 2008, Enlight develops, finances, constructs, owns, and operates utility-scale renewable energy projects. Enlight operates across the three largest renewable segments today: solar, wind and energy storage. A global platform, Enlight operates in the United States, Israel and 9 European countries. Enlight has been traded on the Tel Aviv Stock Exchange since 2010 (TASE: ENLT) and completed its US IPO (Nasdaq: ENLT) in 2023.

 

Appendix 1 - Consolidated statements of financial position

 

 

 

 

 

 

Segmental Reporting

---

 

 

Segmental Reporting (cont.)

---

 

 

Appendix 2 - Reconciliations between Net income to Adjusted EBITDA

 

Appendix 3 - Mature Projects: 4.5 GW operational by 2025

 Operational MW Over Time

Appendix 4 - Mature Projects information

 

 

* We generated $2m of proceeds from the sale of electricity in Israel under long term PPAs which are not recognized as revenue or included in Adjusted EBITDA (projects treated as Financial Assets) for the fourth quarter ended December 31, 2022 and $18m for the twelve months ended December 31, 2022.

** We use an annualized total amount of Segment Adjusted EBITDA given the rapid growth of our Operational Projects between quarters in 2022, which resulted in rapid growth in our Segment Adjusted EBITDA in between quarters. In addition, our geographic and technological diversity substantially mitigates any seasonal effects.

*** Invested capital in a project reflects the total cost we incurred to complete the development and construction of such project.

 

* Full COD expected by end of Q2 2023. 11 turbines operational as of December 31,2022; 26 turbines operational as of the date of this release (out of a total of 60 turbines)

 

* For projects not located in the United States, the conversion into U.S. dollars was based on foreign exchange rates as of the date of the financial statements (December 31, 2022)

** Total tax equity investment anticipated as a percentage of total project costs

*** EBITDA does not include recognition of PTC or ITC tax credits. EBITDA is a non-IFRS financial measure. The Company is unable to provide a reconciliation of EBITDA to Net Income on a forward-looking basis without unreasonable effort because items that impact this IFRS financial measure are not within the Company’s control and/or cannot be reasonably predicted.

 

* For projects not located in the United States, the conversion into U.S. dollars was based on foreign exchange rates as of the date of the financial statements (December 31, 2022)

** Total tax equity investment anticipated as a percentage of total project costs

*** EBITDA does not include recognition of PTC or ITC tax credits. EBITDA is a non-IFRS financial measure. The Company is unable to provide a reconciliation of EBITDA to Net Income on a forward-looking basis without unreasonable effort because items that impact this IFRS financial measure are not within the Company’s control and/or cannot be reasonably predicted

Appendix 5 – Functional Currency Conversion Rates:

 

The financial statements of each of the Company’s subsidiaries were prepared in the currency of the main economic environment in which it operates (hereinafter: the “Functional Currency”). For the purpose of consolidating the financial statements, results and financial position of each of the Group’s member companies are translated into the Israeli shekel (“NIS”), which is the Company’s Functional Currency. The Group’s consolidated financial statements are presented in U.S. dollars (“USD”)..