THEOLIA : 2007: Strong Growth In Results

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  • Record sales of ¤306m
  • EBITDA of ¤27m much higher than in 2006
  • EBITDA of ¤41m assuming full year consolidation of wind farms acquired from GE Energy Financial Services

2007: Year Of Transformation For Theolia

  • Strategic partnership with GE Energy Financial Services, acquisition of 165 MW in Germany
  • Installed capacity of 630 MW and pipeline of 2,441 MW as of December 31, 2007
  • Strengthened financial capacity

Growth Targets Confirmed

  • 2,000 MW of wind electricity production capacity confirmed for 2011
  • Increase in MW built, financed and operated for its own account
  • Strong growth in EBITDA for 2008
In ¤K 12/31/2007 12/31/2006 12/31/2006
Adjusted1
Fiscal Year : 12 months 18 months 12 months
Sales 306,481 70,986 158,496
EBITDA2 26,928 386 10,952
Operating income before goodwill impairment  17,764 (7,938) 2,404
Goodwill impairment (IFRS 3) (56,490) - -
Operating income (38,726) (7,938) 2,404
Net financing costs (10,086) (488) (1,445)
Net income (48,807) (4,173) 4,064
On 12/31/2007:      
Shareholder's equity 403,071 171,421 171,421
Cash and cash equivalents 327,327 66,307 66,307
Net debt 222,069 61,098 61,098
1Published 2006 adjusted to reflect only 2006 (12 months) and the acquisition of NATENCO with an effective date of January 1, 2006, even though the acquisition took place in December 2006.
2EBITDA = current operating income + depreciation + non cash expenses (depreciation and amortization, cost of free shares and stock warrants).


Even though the wind farms from GE Energy Financial Services were not integrated until July 2, 2007, the following table outlines pro forma earnings based on their integration as of January 1, 2007.

In ¤K 12/31/2007 12/31/2007
Pro Forma3
Fiscal Year : 12 months 12 months
Sales 306,481 323,385
EBITDA2   26,928 41,042
2EBITDA = current operating income + depreciation + non cash expenses (depreciation and amortization, cost of free shares and stock warrants).
3Pro Forma with acquisition of farms from GE Energy Financial Services with an effective date of January 1, 2007 instead of July 2, 2007


Jean-Marie Santander, Chairman & CEO of THEOLIA, stated
: « 2007 marked a major transformation for THEOLIA, taking the company to a new level. The strategic partnership with GE Energy Financial Services increased our installed capacity to 630 MW at the end of 2007. At the same time, our efforts in development have enriched our pipeline- 2,441 MW at the end of 2007.The integration of NATENCO into THEOLIA has accelerated its activity. Our significantly improved financial capacity will allow us to accelerate our growth and will remove the financial constraint that used to determine whether to keep or sell wind farms to third parties. While an average installed capacity of just over 150 MW for our own account generated results in 2007, 333 MW were operational at the end of 2007.We are confident for a very strong increase in our earnings in 2008»


Strong growth momentum

THEOLIA experiences strong progress in all its wind activities.

Its installed capacity has nearly tripled: from 209 MW at the end of 2006 to 630 MW at the beginning of 2008:

  • an increase of 2­69 MW of installed capacity for its own account;
  • an increase of 152 MW of installed capacity for third parties.

Its pipeline of development projects grew from 1,905 MW to 2,441 MW at the end of 2007 to 2,996 MW as of March 31, 2008.

The sales of wind farms by NATENCO achieved substantial growth with 38 projects totaling 133 MW sold in 2007 versus 19 projects totaling 54 MW sold in 2006. Only 34% of the projects sold in 2007 had been developed by the company. Most of NATENCO's business involved acquisitions from developers or co-development-construction-sales to third parties. As of March 31, 2008, 210 MW have been identified for resale.

In addition, THEOLIA is progressively exiting its non wind activities, as evidenced by the IPO of THENERGO in June 2007 on Alternext, to concentrate its financial and human resources on its wind activities.


Strong growth in financial results

Sales reached a record high of ¤306m in 2007, an increase of 92% compared with the 2006 adjusted sales. This increase was mainly generated by strong organic growth in all wind activities of the company. Integrating the acquisition of the wind farms of GE Energy Financial Services over a full year, the pro forma sales figure was ¤323m in 2007.

THEOLIA's EBITDA amounts to ¤27m in 2007 and ¤41m in a pro forma basis including the acquired wind farms from GE Energy Financial Services over 12 months, instead of 6 months. With this acquisition, the average installed capacity of 151 MW for its own account in 2007 increased to 234 MW with the wind farms of GE Energy Financial Services over a full year. The strong increase of electricity sales for its own account contributed substantially to EBITDA.

This performance was nonetheless affected by poor wind conditions for the wind farms in Germany during the second half of the year compared to the first half. This underperformance had a negative impact of ¤4m on previously stated EBITDA target.

THEOLIA's 2007 net income was affected by a goodwill impairment from the acquisition of the wind farms (165 MW) from GE Energy Financial Services. The significant increase in THEOLIA's stock price between the price of ¤16.50 retained in the transaction agreement (February 13, 2007) and the price of ¤27.26 at the closing date (July 2, 2007) generated an additional goodwill of ¤56m that led to an exceptional write-off. This impairment represents an accounting treatment with no impact on either the value or the profit outlook of the assets acquired.

Thanks to the confidence of its investors and its financial partners, THEOLIA has proven its capacity to raise capital on the market, in October 2007, with a ¤240m convertible bond issue that was four times oversubscribed. The Group has thus reinforced its cash position, which amounted to ¤327m as of December 31, 2007.

Growth targets re-affirmed

THEOLIA has significantly strengthened its profile through the various structural changes that occurred in the course of 2007. THEOLIA's diversified geographic presence, high-quality pipeline, optimized and diversified turbine supply policy with 340 MW secured and financing capacity are key strengths on which is based THEOLIA's confirmation of its 2,000 MW in operation target in 2011 with at least 1,100MW for its own account. THEOLIA's 2008 targets are 1) sales ¤370-¤400m 2) EBITDA ¤55-¤65m.  


2007 highlights

Partnership agreement with GE Energy Financial Services in February 2007 including the acquisition of seven wind farms in Germany with an installed capacity of 165 MW. This transaction agreement was contracted, with a capital increase of 1,212,000 shares reserved for GE Energy Financial Services plus the issuance of 3,000,000 warrants for it.

Capital increase within the « PACEO » program for a total of 3,100,000 shares subscribed by Société Générale in February 2007.

Listing of THENERGO on Alternext in June 2007, followed by a capital increase of ¤65m.

Inauguration of Theolia Emerging Markets (TEM), on September 20, 2007.

Admission into the SBF 120 Index, on September 24, 2007.

Issuance of a convertible bond (OCEANE) for ¤240m pursuant to an AMF prospectus dated October 23, 2007.

Acquisition in November 2007 of MAESTRALE GREEN ENERGY, an Italian developer with a project portfolio exclusively located in Italy of 500 MW as of the acquisition date.

Acquisition in November 2007 of a 35.21% stake in ECOLUTIONS, a German company specializing in origination of carbon certificates, certification and trading.


About THEOLIA

THEOLIA is a leading European producer of electricity from renewable energy. THEOLIA is active in France, Germany, Spain, Greece, Italy and in certain emerging countries through its subsidiary Theolia Emerging Markets: India, South America, certain countries of Eastern Europe and Morocco. THEOLIA trades on the Eurolist B of Euronext Paris under the symbol TEO. The stock was admitted to the SBF 120 index on September 24, 2007 and to the NEXT 150 index on January 2, 2008.

For more information

Edward F. McDonnell
Investor Relations
Tél : +33 (0)4 42 906 594
eddie.mcdonnell@theolia.com
Dolores Muniz
Communications
Tél : +33 (0)4 42 904 904
dolores.muniz@theolia.com

THEOLIA
Public Limited Company with board of directors
Share capital of ¤38,681,671
Registered office: 75 rue Denis Papin - BP80199 - 13795 Aix-en-Provence cedex 3, France
Tel: +33 (0)4 42 904 904 - Fax: +33 (0)4 42 904 905 - www.theolia.com
THEOLIA is listed on Eurolist B, Euronext Paris under the mnemonic TEO
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