Preliminary Results

RNS Number : 1567E

Good Energy Group PLC

07 April 2014

 

Good Energy Group plc ("Good Energy" or the "Company")

Preliminary Results

7 April 2014

Good Energy Group PLC Results Announcement for year ended 31 December 2013

·     Revenue increased 43% to £40.4m (2012 - £28.2m)

·     Gross profit improved 42% to £13.6m (2012 - £9.6m)

·     PBT rose 136% to £3.3m (2012 - £1.4m)

·     EBITDA up 85% to £5.0m (2012 - £2.7m)

·     Cash balance (Dec 31 2013) - £18.0m (2012 - £9.5m)

·     Basic earnings per share increased 58%  to 20.9 p (2012 - 13.2p)

·     Final dividend recommended of  2.3p (1.0p interim dividend already paid) -10% increase (2012: 3.0p)

(Dateline: London): Good Energy Group PLC (GOOD LN), the AIM quoted,  fast-growing renewable energy provider, today reported a sharp improvement in full-year earnings as pre-tax profits more than doubled to £3.3m amid rising consumer demand and successful project development in the 12 months to December 31, 2013.

The Company, which is investing to own more than 110 megawatts of renewable electricity generation in the UK by 2016, including its recent investment in the 8.2MW Hampole wind farm, delivered a gross margin of 34% on revenues that jumped to £40.4m (2012 - £28.2m) in the period.

Juliet Davenport, Chief Executive, said: "We are out-performing Britain's energy market, with customer numbers rising 32% as more than 100,000 households, businesses and renewable energy generators opt for Good Energy's electricity, gas and feed-in-tariff services. The Company has exceeded market forecasts, improved its margins, expanded generating capacity and maintained its focus on customer service."

At year end, Good Energy had grown its electricity customer base by 25% to 40,000 while its gas customer base jumped by 76% to 15,000 (2012: 32,000 and 8,500 respectively).

Good Energy ended the period in a strong, positive cash position following the completion of successful equity and bond issues, enabling continued investment in generating assets and customer growth.

"The corporate bond was heavily oversubscribed with £15 million of demand and Good Energy topped the Which? customer satisfaction survey for the third year running," Davenport added. "Britain is becoming a nation of renewable generators with 59,000 of our customer sites providing clean energy for their homes and the grid. Our rapid customer growth, including from households generating their own power, demonstrates the growing appeal and value of renewable energy."

Outlook

Good Energy anticipates further growth in the current year, as customers continue to gravitate to cleaner and more competitively-priced sources of heat and power.

The Company aims to continue to manage its cost base appropriately and expects to see the full benefits of the new trading platform, increasing diversity of the supply base and owner-operator strength through the course of the current year.

Good Energy is ahead of its plan to implement a two-year investment programme focused on generating its targeted level of renewable electricity capacity by 2016. This is part of the Company's commitment to deliver a target of 50% electricity supply met from its own generating capacity by 2016, and the Company has the financial strength to continue to grow the supply and generation businesses strongly.

Contact details

Good Energy Group plc   

Juliet Davenport, Chief Executive                       01249 766795

Garry Peagam, Group Finance Director              01249 766795

Media enquiries                                                      

Gill Dickinson                                                    01249 765540

N+1 Singer (Nominated Adviser & Broker)

Andrew Craig / Ben Wright                               020 7496 3000

StockWell Communications

Tim Burt / Sabine Pirone                                    020 7240 2486

Chairman's Statement

For the year ended 31 December 2013

Good Energy Group PLC (the "Group" or the "Company") achieved a year of strong growth during 2013, delivering an overall business performance ahead of market expectations. Growth was delivered across the electricity generation, electricity and gas supply, and Feed-in Tariff (FIT) administration businesses. In addition, there was an increase in gross profit due to the sale of some solar generation development sites. This resulted in a total gross profit increase of 42%, to £13.6m. The Company's cash flow position remains healthy and combined with the Board's expectations for continued future growth, the Board is recommending for approval by shareholders at our AGM, a final dividend for the year of 2.30p per Ordinary Share (2012: 2.00p). This gives a full-year dividend of 3.30p (2012: 3.00p).

Growth was achieved through the delivery of our strategy, which is focused on the customer offer, investment in generating capacity and improvements in cost controls. The combination of competitive pricing, renewables-only electricity generation and award-winning customer service has driven customer numbers and retention. The introduction of a new trading platform, diversification of the supply base and investment in Group owned and operated energy assets has delivered improvements in energy price stability, reduced power costs and improved margin. 2013 saw the successful launch of a £15m (before costs) Good Energy Bond, an equity raising of £2.7m (before costs), and an 89% increase in the cash balance at £18m. The Group is therefore financially well placed to continue to deliver on its objectives.

The UK energy market was subject to continued political and public market commentary and scrutiny. The Government's Energy Bill received Royal Assent during the year, establishing a roadmap for the UK's switch to a low-carbon economy and demonstrating its continued commitment towards the renewal and expansion of the energy market to enhance energy independence and security, and to reduce reliance on fossil fuels. Provisional government figures show that renewable sources accounted for 14.8% of the electricity generated in the UK during the 12 months to December 2013, demonstrating that renewable electricity sources such as wind and solar have a valuable contribution to make towards the UK's energy mix. We are determined that the Group will continue to be at the forefront of investment in the generation and supply of renewable electricity to UK households and businesses.

Consumer distrust of the larger, established energy companies continued to be an issue during the year, as did debate over the inclusion of Energy Company Obligation costs in household energy bills. While many suppliers introduced price increases during the latter part of the year, we were able to hold our prices until the end of March 2014. These factors, together with our growing reputation for customer service, contributed towards a strong uplift in sales during the last quarter.

During the year, we continued to deliver our programme of investment in our project pipeline and good progress was made towards delivering a total development portfolio of 200MW, comprising new solar and wind assets. Construction of our £16m Hampole Wind Farm near Doncaster began in the last quarter with commissioning now complete. In the second half of 2013 alone, we received consent to build 100MW of solar parks.

The Group's strategy of recognising value and reinvesting in the pipeline was evidenced with the sale of solar sites, with full planning permission, totalling 40.5MW, and the start of construction for a further 6.4MW of new sites. With some 60MW of additional consented solar sites including the recently fully-approved 49.9MW site at West Raynham, Norfolk, and an ongoing development portfolio, the Group is well placed to respond to increasing demand for renewable electricity supply. The Company has continued to invest, not only in our project pipeline but also in our existing infrastructure and business operations. This enabled us to deliver efficiencies from our trading and forecasting systems, and from processes. In addition, our wind farm at Delabole, North Cornwall, exceeded operational expectations, generating around 14% of the business's total renewable electricity supply. These all contributed to our ability to drive down power purchase costs.

These investment plans were further underpinned by the success of the Good Energy Bond, which was launched in the autumn of 2013 and raised the maximum permissible subscription of £15m (before costs). It is a mark of the confidence which our customers place in us and our ethos that more than 80% of the applications for the Bond came from our customers. We also raised additional equity of £2.7m (before costs) through a Share Placing and Open Offer of a total of 2,145,247 new Ordinary Shares. These two initiatives have helped us towards achieving our goal of accelerating the development of our renewable energy generation capacity.

Looking ahead, our new trading systems, the launch of a Customer Relationship Management (CRM) system and evidence of the continued high levels of customer satisfaction (as demonstrated by our success in securing first place in the Which? energy company customer satisfaction survey for the third year in a row), will position the Group well to enjoy further growth and market consolidation during 2014.

We have continued to invest in the Board with the appointment this year of Denise Cockrem as Chief Finance Officer, a role she takes up from 1 May. Denise joins us from the Royal & Sun Alliance Insurance Group where she is currently UK & Western Europe Finance Director.

On behalf of the Board, I would like to thank Garry Peagam, Group Finance Director, for his contribution to the Group since his appointment in 2010. Under Garry's financial direction, the Group achieved AIM listing and has grown significantly in terms of its project development and supply businesses.

I would also like, on behalf of the Board, to thank Juliet Davenport and all her staff for the energy, enthusiasm and commitment with which they continue to pursue the goals of the Group. We thank, too, all the Group's customers, generators, shareholders and bond holders for their on-going support as we seek to continue to be catalysts for change in the UK energy market.

John Maltby

Chairman

7th April 2014

Chief Executive's Overview

For the year ended 31 December 2013

For Good Energy Group PLC, the over-riding theme of 2013 has undoubtedly been one of growth.

Revenue increased by 43% to £40.4m and profit before tax increased by 136% to £3.3m. We have delivered on our promises and our 'customer first' strategy of competitive pricing, renewables-only electricity generation and award winning customer service is continuing to drive both customer numbers and retention. We have seen substantial growth in the numbers of our electricity and gas customers, and Feed-in Tariff sites, with an overall increase of 32% to more than 114,000 by the end of 2013.

The focus on cost controls, investment in generation and successful implementation of a new dynamic trading platform has reduced power costs and improved margins. We have increased the number of projects in our wind and solar pipeline, helping us to move closer towards our target of developing, owning and operating more renewable generation capacity, and generating 50% of all the electrons we require by 2016. The Group has continued to diversify its supply base and the number of generators from whom we contract to purchase renewable electricity has risen to more than 640 sites across the UK.

The Group's strong financial position has enabled continued investment to deliver growth and margin. We have a strong, positive cash position and we've added to our sources of funding through the Group's successful, over-subscribed Bond, which we launched in the final quarter of the year, and an equity raise. This will enable our planned continued investment in generation and cost efficiency improvements.

The year has not been without its challenges, particularly from the regulatory, political and market perspective. Work has been required to begin preparations for the smart metering programme; to implement the Retail Market Review; and prepare for the Electricity Market Reform due to be fully implemented in 2017. There has also been considerable debate over the Labour Party's plans to introduce an 18-month price freeze should it be successful in the 2015 General Election. Public trust is at an all-time low due to its perception of a lack of transparency of energy prices. Despite this, the Group managed to maintain a high level of satisfaction in the Which? annual energy company customer satisfaction survey.

Financial highlights

• Revenue increased by 43% to £40.4m (2012 - £28.2m)

• Gross profit increased 42% to £13.6m (2012 - £9.6m)

• EBITDA increased 85% to £5.0m (2012 - £2.7m)

• Profit before tax increased 136% to £3.3m (2012 - £1.4m)

• Cash balance total as at 31 December was £18.0m (2012 - £9.5m)

• Basic earnings per share rose by 58% to 20.9p (2012 - 13.2p)

Electricity and gas market positioning

By the close of 2013 we had 40,000 electricity and 15,000 gas customers (compared to 32,000 electricity and 8,500 gas customers at the end of 2012), representing growth of 25% and 76% respectively. Our Feed-in Tariff (FIT) site base also experienced growth, rising 28% from 46,000 to 59,000. We continue to be one of the largest administrators of the FIT scheme in the UK.

We were pleased that for a third year in a row, Which? ranked us top of its energy company customer satisfaction survey, giving us a five star rating in every category including 'value for money' and our Energy Savings Trust-accredited energy saving advice. We continue to believe that helping our customers reduce the amount of gas and electricity they use is important, reflecting our view that we all have a role to play in managing and becoming smarter in our energy usage.

Independent endorsement of this nature is valuable to us as it offers customers clarity on what they can expect from us as their energy supplier, and allows them to compare our performance with that of others. At a time when the energy market is seldom out of the public spotlight, this additional third-party perspective is welcome.

Our price freeze in November, increasingly competitive pricing structure and third-party endorsement have all contributed to our continued growth in customer numbers. We know our customers are also attracted to the Group's core proposition of offering a 100% renewable electricity mix, and developing, owning and operating more renewable energy capacity to meet the growing demand for energy.

Following our subsequent announcement of a price change of 2.2% across dual fuel, we may see a slow-down in customer growth, but we expect to maintain a competitive position where we are no more expensive than the big six energy suppliers, based on tariffs with no discounts. We will seek to consolidate our performance in 2014 and continue to invest to grow the customer base.

At the end of 2011 we began work on a new Customer Relations Management (CRM) system which we rolled out in the last quarter of 2013. We invested in the system to support the Company's ability to take advantage of economies of scale as we grow. The first quarter of 2014 has been the first operational period of the new CRM system, and while there are some challenges anticipated with bedding in the system and ensuring we are using it effectively, we expect to see the benefit as the year progresses.

Trading

A key area of focus for the business during 2013 has been the continued drive to improve and refine our forecasting and trading systems, and improve our access to the markets. This was implemented in March 2013, and we have seen a significant improvement in our key performance indicators (KPIs) including improved forecasting, better market access in the day ahead and within day markets, and less use of the imbalance markets. We have achieved a reduction of more than 50% in the volume of power traded in the imbalance market. The cumulative impact of these KPI improvements in 2013 alone was in excess of £275,000.

We now have a more responsive and flexible trading platform, which enables us to better reflect the dynamic nature of the renewables market. Our resulting enhanced performance, along with the above-forecast electricity generation contribution from Delabole wind farm, has enabled us to reduce our power purchase costs and improve our competitive position while maintaining margins.

Renewable support scheme

A percentage of the charges paid by the Group's gas customers has historically been used for the renewable support scheme, in the form of our HotROCs scheme. The growth in our gas customer numbers during the year has resulted in a fund surplus, which will enable us to extend our support of renewables in 2014. In addition to encouraging solar thermal projects, we will be looking to support a number of community-based projects.

Generation

We are progressing well towards our target of creating a portfolio of wind, solar and small hydro generation assets to enable us to deliver 50% of electricity from our own renewable generation assets by 2016.

We have received planning permission for more than 100MW of solar parks including Woolbridge in Dorset (5MW solar farm), Carloggas (9MW solar farm) and Creathorne Farm (1.4MW solar farm), both in Cornwall. West Raynham, in Norfolk (49.9MW solar farm), received final planning approval in January 2014. We are now constructing the Woolbridge and Creathorne Farm sites which should be commissioned by Q3 2014, and are considering strategic funding requirements for the rest of the portfolio. In South Yorkshire, work was progressed on our £16m, four-turbine wind farm development, which began generating at the end of March this year. The site, at Hampole, near Doncaster, is expected to generate 8.2MW (20,000 MWh), enough electricity for between 4,000-5,000 homes - and almost double the amount of renewable electricity we currently produce. The wind turbine towers for Hampole have all been manufactured by UK company Mabey Bridge, at its Chepstow facility.

Our existing 9.2MW wind farm in Delabole, Cornwall, had a particularly strong year, due to a windy 12 months, and generated more than had been forecast. The 27GWh produced during 2013 contributed around 14% of our renewable electricity supply base requirement.

Good Energy Bond

The Group has a long history of inviting its customers to invest directly in the Company and in October 2013 we launched our first Corporate Bond. Seeking to raise a minimum of £5m from both individual and institutional investors, there was significant interest and we closed the Bond three weeks ahead of schedule having achieved the £15m maximum subscription amount.

Of particular note was that 80% of the applications came from the Group's customers. We believe that this success is indicative of strong brand confidence in Good Energy. The Good Energy Bond is now part of a set of instruments the Group is using to provide funding for the future growth of the Company.

Financial Overview

Highlights of the Financial Information of Good Energy Group PLC for the year ended 31 December 2013 are set out below, together with explanatory notes and comparisons with previous years where appropriate.

Revenue and Gross Profit

Revenue for the year, at £40.4m, was 43% up on 2012 (£28.2m). Of this, £4.9m was due to the successful sale of two solar farm development sites. The balance of £7.3m was from an increase in customer numbers and the strong performance at our Delabole Wind Farm. Revenue from supply of gas increased by £3m compared with 2012, driven by the 76% growth in gas customers. Revenue from electricity supply and FIT administration combined was up 18% (£4.2m) compared with last year, due to customer growth of 27%, which was moderated by a reduced average consumption per customer.

Gross profit increased by £4.0m (42%) to £13.6m. This is partly due to £1.6m (17%) from electricity and FIT administration and £0.5m (5%) from gas. These entities benefited from strong customer growth. In addition, £1.6m (17%) related to the profit on sale of the solar farms which is net of £1.2m of attributable provisions and early stage write off costs on solar generation projects. Overall, these costs were incurred against a backdrop of two successful site sales in 2013 and a strong pipeline of generation projects (both solar and wind) by the end of the year. This activity is enabling us to continue to build a healthy portfolio of wind and solar generation.

As a result of these factors, gross margin was maintained at 34% (2012: 34%).

Administration Expenses

Growth in our customer numbers and the associated costs to serve the growing customer base are the main reason for a £2.2m (29%) increase in administration costs.

Depreciation charges increased as our Customer Relationship Management system, which seeks to deliver improved customer service, went live and became fully operational in Q4. In addition, investment in recruitment, and staff skills to support all areas of the business increased.

Earnings before interest, taxes, depreciation and amortization (EBITDA)

EBITDA of £5.0m has increased by 85% (£2.7m) compared with 2012. This represents 12.4% of consolidated revenue (2012: 9.4%).

Financial Position and Financing

The Consolidated Statement of Financial Position for the Group shows a Shareholders' Equity of £16.5m (2012: £11.1m) representing growth of 49%, due to the equity raise and financial performance in 2013.

Investment in our Hampole wind farm and generation pipeline has supported our increased asset position of £56m (2012: £30m). The diversified funding strategy adopted by the Group resulted in £19.1m of new funds (after costs) being made available throughout the year.

In July 2013, the Group raised £2.7m (before costs), by way of placing an offer on the AIM market of the London Stock Exchange for 2.15m Ordinary Shares. A further £15m (before costs) was raised through the launch of the Good Energy Corporate Bond and £2.7m was drawn down on loans against the construction of Hampole. Operating cash flow was £0.9m positive after £3.5m of investment in generation development sites. The underlying operating cash flow before the investment in generation was £4.4m positive. The net increase in cash was £8.4m with a cash balance of £18.0m at the year-end (2012: £9.5m).

The Group has a long term financing arrangement in place to support investment in its wind farm at Delabole, with a balance of £8.5m at the end of 2013 (2012: £8.9m). The majority of debt interest payable in 2013 was attributable to this loan.

Dividend

The Directors declared an interim dividend of 1.00p per Ordinary Share with a total value of £146,000 (2012: £125,000), which was paid to shareholders on 25 October 2013.

The Directors recommend a final dividend of 2.30p per Ordinary Share with a total value of £337,362 based on issued shares as at 1 April 2014 (2012: £251,000). The final dividend for the year will be paid on 30 May 2014, subject to shareholder approval at the Annual General Meeting, to Ordinary Shareholders on the register on 9 May 2014. The total dividend per Ordinary Share for the year ended 31 December 2013 is 3.30p (2012: 3.00p).

Market & Regulatory Framework

The energy market was subject to considerable regulatory, political and consumer focus during the year. We welcomed this scrutiny which acted as a catalyst to drive customer growth and we anticipate that this much-needed focus will continue throughout 2014 in the build up to the General Election in 2015.

The energy industry regulator recently announced a consultation to consider whether a full market review should be carried out by the Competition and Markets Authority (CMA). We welcome this focus on our sector: it is an opportunity to ensure it is delivering the right competitive environment, which benefits consumers. We are considering the detail of review and its scope, and will participate fully in the inquiry. We look forward to the outcome. In the meantime, the Group will continue to focus its energies on delivering best-in-class services for its customers and working with them to create a more secure, renewable energy future for the UK.

The launch of the Department of Energy and Climate Change Community Energy Strategy in the first quarter of the year lays a useful foundation for developing energy generation and ownership in the heart of communities. We look forward to seeing how the detail of this unfolds and to exploring the opportunities we believe this will present us with.

Employees

As at 31 December 2013, the Group employed 181 people (2012: 157). The Group aims to provide all its employees with a safe and productive working environment. It offers a structured internal training programme through its Fluent in Energy Academy and external courses to enhance employee skills and capabilities. It also has an employee bonus scheme, which seeks to reward staff and is aligned with performance management and value creation. In addition, it operates a defined contribution pension scheme. The Group expects the highest standards of social and commercial behaviour from its employees.

Future developments

Following a strong performance in 2013, the Group is focused on continued growth in all sectors within the electricity, gas and FIT customer markets. Work will continue on integrating people and systems and we expect systems improvements to positively impact trading margins and cost to serve. Investment will be directed towards two key areas: the Good Energy brand and new sources of renewable electricity generation (wind, solar and hydro), to better enable us to achieve 50% of our own renewable electricity supply by 2016. The political focus on the domestic energy market and energy price increases look set to continue through 2014 and beyond. The Group intends to continue to remain active in the political debate over these issues whilst focusing on offering customer value for money, good customer service and a strong renewable ethos.

Juliet Davenport

Chief Executive

7th April 2014

Consolidated Statement of Comprehensive Income

For the year ended 31 December 2013

	2013	2012
	£000's	£000's
REVENUE	40,407	28,202
Cost of Sales	(26,822)	(18,653)
GROSS PROFIT	13,585	9,549
Administrative Expenses	(9,727)	(7,525)
OPERATING PROFIT	3,858	2,024
Finance Income	116	39
Finance Costs	(719)	(688)
PROFIT BEFORE TAX	3,255	1,375
Taxation	(586)	(191)
PROFIT FOR THE YEAR	2,669	1,184
Other comprehensive income:
Items that may subsequently be reclassified to profit or loss
Net gains on cash flow hedge	328	-
Other comprehensive income for the year, net of tax	328	-
TOTAL COMPREHENSIVE INCOME FOR THE YEAR	2,997	1,184
ATTRIBUTABLE TO OWNERS OF THE PARENT COMPANY
Profit	2,669	1,184
Total comprehensive income	2,997	1,184
Earnings per share from profit for the year         - Basic	20.9p	13.2p
- Diluted	19.6p	12.6p

Consolidated Statement of Financial Position

As at 31 December 2013

	2013	2012
	£000's	£000's
Non-current assets
Property, plant and equipment	20,112	11,012
Intangible assets	3,478	2,938
Derivative financial instruments	328	-
Total non-current assets	23,918	13,950
Current assets
Inventories	6,128	2,677
Trade and other receivables	7,952	3,813
Cash and cash equivalents	17,975	9,535
Total current assets	32,055	16,025
TOTAL ASSETS	55,973	29,975
Equity and liabilities
Capital and reserves
Called up share capital	733	626
Share premium account	9,077	6,729
EBT shares	(236)	(470)
Retained Earnings	6,890	4,167
Total Equity	16,464	11,052
Non-current liabilities
Deferred taxation	738	644
Borrowings	24,667	8,659
Total non-current liabilities	25,405	9,303
Current liabilities
Borrowings	674	543
Derivative financial instruments	52	-
Trade and other payables	12,875	9,001
Current tax payable	503	76
Total current liabilities	14,104	9,620
Total liabilities	39,509	18,923
TOTAL EQUITY AND LIABILITIES	55,973	29,975

Consolidated Statement of Changes in Equity

For the year ended 31 December 2013

	Share Capital	Share Premium	EBT Shares	Retained Earnings	Total
	£000's	£000's	£000's	£000's	£000's
At 1 January 2012	391	3,536	(537)	3,313	6,703
Profit for the year	-	-	-	1,184	1,184
Other comprehensive income for the year	-	-	-	-	-
Total comprehensive income for the year	-	-	-	1,184	1,184
Issue of ordinary shares	235	3,765	-	-	4,000
Cost of shares issued in the year	-	(572)	-	-	(572)
Purchase of shares by EBT	-	-	(50)	-	(50)
Sale of shares by EBT	-	-	117	(19)	98
Dividend Paid	-	-	-	(311)	(311)
Total contributions by and distributions to owners of the parent, recognised directly in equity	235	3,193	67	(330)	3,165
At 31 December 2012	626	6,729	(470)	4,167	11,052
At 1 January 2013	626	6,729	(470)	4,167	11,052
Profit for the year	-	-	-	2,669	2,669
Other comprehensive income for the year	-	-	-	328	328
Total comprehensive income for the year	-	-	-	2,997	2,997
Issue of ordinary shares	107	2,574	-	-	2,681
Cost of shares issued in the year	-	(226)	-	-	(226)
Purchase of shares by EBT	-	-	(3)	-	(3)
Sale of shares by EBT	-	-	237	103	340
Dividend Paid	-	-	-	(377)	(377)
Total contributions by and distributions to owners of the parent, recognised directly in equity	107	2,348	234	(274)	2,415
At 31 December 2013	733	9,077	(236)	6,890	16,464

Consolidated Statement of Cash Flows

For the year ended 31 December 2013

	2013	2012
	£000's	£000's
Cash flows from operating activities
Cash generated from operations	938	6,045
Interest received	116	39
Interest paid	(647)	(688)
Income tax (paid)/received	(64)	178
Net cash flows from operating activities	343	5,574
Cash flows from investing activities
Acquisitions of property, plant and equipment	(9,364)	(275)
Acquisitions of intangible fixed assets	(1,073)	(786)
Net cash flows used in investing activities	(10,437)	(1,061)
Cash flows from financing activities
Payments of dividends	(377)	(311)
Bank financing advanced	2,433	-
Bank financing repaid	(390)	(369)
Proceeds from issue of corporate bond	14,229	-
Capital repayments of finance leases	(153)	(143)
Proceeds from issue of shares	2,455	3,428
Purchase of own shares	(3)	(50)
Sale of own shares	340	98
Net cash flows from financing activities	18,534	2,653
Net increase in cash and cash equivalents	8,440	7,166
Cash and cash equivalents at beginning of year	9,535	2,369
Cash and cash equivalents at end of year	17,975	9,535

Notes to the financial information

1. General Information
Good Energy Group PLC is listed on the Alternative Investment Market of the London Stock Exchange and is incorporated and domiciled in the United Kingdom.

The Company's registered office and its principal place of business is Monkton Reach, Monkton Hill, Chippenham, Wiltshire, SN15 1EE. The Company's registered number is 04000623.

2. Basis of preparation of Financial Information
This announcement is an extract from the consolidated financial statements of the Company for the year ended 31 December 2013 and comprises the Company and its subsidiaries.  The consolidated financial statements were authorised for issuance on 7 April 2014. These financial results do not comprise statutory accounts for the year ended 31 December 2013 within the meaning of Section 434 of the Companies Act 2006. The financial information set out below does not constitute the Company's statutory accounts for the years ended 31 December 2012 or 2013 within the meaning of Section 434 of the Companies Act 2006, but is derived from those accounts. Statutory accounts for 2012 have been delivered to the Registrar of Companies and those for 2013 will be delivered following the Company's Annual General Meeting. The auditors' reports on the statutory accounts for the years ended 31 December 2012 and 31 December 2013 were unqualified and do not contain statements under s498(2) or (3) Companies Act 2006.

This Financial Information has been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and IFRIC interpretations and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS.

The Financial Information has been prepared on a going concern basis and under the historical cost convention.

Certain statements in this announcement constitute forward-looking statements. Any statement in this announcement that is not a statement of historical fact including, without limitation, those regarding the Company's future expectations operations, financial performance, financial condition and business is a forward-looking statement. Such forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially. These risks and uncertainties include, amongst other factors, changing economic, financial, business, regulatory or other market conditions. These and other factors could adversely affect the outcome and financial effects of the plans and events described in this announcement and the Company undertakes no obligation to update its view of such risks and uncertainties or to update the forward-looking statements contained herein. Nothing in this announcement should be construed as a profit forecast.

Segmental Analysis

The chief operating decision-maker has been identified as the Board of Directors (the 'Board'). The Board reviews the Group's internal reporting in order to assess performance and allocate resources. Management has determined the operating segments based on these reports.  The Board considers the business from a business class perspective, with each of the main trading subsidiaries accounting for each of the business classes. The main segments are:

·     Electricity  supply and FIT administration

·     Gas supply

·     Electricity generation

·     Generation development

·     Holding companies, being the activity of Good Energy Group PLC

The Board assesses the performance of the operating segments based primarily on summary Financial Statements, extracts of which are reproduced below.  An analysis of profit and loss, assets and liabilities and additions to non-current asset, by class of business, with a reconciliation of segmental analysis to reported results follows:

Segmental Analysis

For the year ended 31 December 2013

	Electricity supply and FIT administration	Gas supply	Electricity Generation	Generation Development	Holding Companies	Consolidation Adjustments	Total
	£000's	£000's	£000's	£000's	£000's	£000's	£000's
Revenue
Revenue from external customers	27,316	7,032	1,112	4,947	-	-	40,407
Inter-segment revenue	-	-	1,369	-	-	(1,369)	-
Total Revenue	27,316	7,032	2,481	4,947	-	(1,369)	40,407
Expenditure
Cost of sales	(18,392)	(5,619)	(833)	(3,347)	-	1,369	(26,822)
Administrative expenses	(5,998)	(746)	(188)	(977)	(1,137)	-	(9,046)
Depreciation & amortisation	(674)	-	-	(4)	(3)	-	(681)
Operating profit/(loss)	2,252	667	1,460	619	(1,140)	-	3,858
Net finance income/(costs)	150	8	(652)	(185)	76	-	(603)
Profit/(loss) before tax	2,402	675	808	434	(1,064)	-	3,255
Taxation	(514)	(167)	(83)	281	(103)	-	(586)
Net profit/(loss) for year	1,888	508	725	715	(1,167)	-	2,669
Segments assets & liabilities
Segment assets	25,686	2,174	20,738	4,503	28,248	(25,376)	55,973
Segment liabilities	20,066	1,293	16,667	6,657	17,072	(22,246)	39,509
Net assets/(liabilities)	5,620	881	4,071	(2,154)	11,176	(3,130)	16,464
Additions to non-current assets	1,347	2	9,453	6	-	-	10,808

The Generation development segment is a new business segment recognised in the Group in 2013.  There is no comparative segment for 2012.

Segmental Analysis

For the year ended 31 December 2012

	Electricity supply and FIT administration		Gas supply		Electricity Generation		Holding Companies	Consolidation Adjustments	Total
	£000's		£000's		£000's		£000's	£000's	£000's
Revenue
Revenue from external customers	23,100		3,998		1,086		18	-	28,202
Inter-segment revenue	-		-		1,208		-	(1,208)	-
Total Revenue	23,100		3,998		2,294		18	(1,208)	28,202
Expenditure
Cost of sales	(15,810)		(3,134)		(917)		-	1,208	(18,653)
Administrative expenses	(4,884)		(651)		(119)		(1,729)	-	(7,383)
Depreciation & amortisation	(137)		-		-		(5)	-	(142)
Operating profit/(loss)	2,269		213		1,258		(1,716)	-	2,024
Net finance income/(costs)	4		6		(657)		(2)	-	(649)
Profit/(loss) before tax	2,273		219		601		(1,718)	-	1,375
Taxation	(427)		(44)		(143)		423	-	(191)
Net profit/(loss) for year	1,846		175		458		(1,295)	-	1,184
Segments assets & liabilities
Segment assets	14,753		1,257		13,303		8,312	(7,650)	29,975
Segment liabilities	(11,003)		(865)		(10,160)		(746)	3,851	(18,923)
Net assets/(liabilities)	3,750		392		3,143		7,565	(3,799)	11,052
Additions to non-current assets	1,048		-		4		3,099	(3,090)	1,061

All turnover arose within the United Kingdom.

Consolidation adjustments relate to intercompany sales of generated electricity and the elimination of intercompany balances.

Earnings per Ordinary Share

The calculation of basic earnings per share at 31 December 2013 was based on the net profit attributable to owners of the parent of £2,669,000 (2012: £1,184,175) and a weighted average number of ordinary shares outstanding during the year ended 31 December 2013 of 12,784,912 (2012: 8,991,576) after excluding the shares held by Clarke Willmott Trust Corporation Limited in trust for the Good Energy Group Employee Benefit Trust.

The calculation of diluted earnings per share at 31 December 2013 was based on the net profit attributable to owners of the parent of £2,669,000 (2012: £1,184,175) and a weighted average number of ordinary shares outstanding during the year ended 31 December 2013 of 13,600,855 (2012: 9,375,514), calculated as follows:

	Consolidated	Consolidated
	2013 (number)	2012 (number)
Basic weighted average number of ordinary shares	12,784,912	8,991,576
Dilutive potential Ordinary Shares:	815,943	383,938
Weighted average number of Ordinary Shares (diluted)	13,600,855	9,375,514

Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all potential dilutive ordinary shares. The Company has one category of dilutive potential ordinary shares, share options. For the share options a calculation is done to determine the number of shares that could have been acquired at fair value (determined as the average annual market share price of the Company's shares) based on the monetary value of the subscription rights attached to the outstanding share options. The number of shares calculated in this way is compared with the number of shares that would have been issued assuming exercise of the share options.

Annual Report and Accounts and Notice of AGM

The Annual Report and Accounts for the year ended 31 December 2013 and Notice of AGM have been posted to shareholders today.

The Company will be holding the AGM at The Lansdowne Club, 9 Fitzmaurice Place, Mayfair, London, W1J 5JD at 12 noon on Wednesday 30 April 2014.

Copies of the Annual Report and Accounts and Notice of the AGM are also available on the Company's website at http://www.goodenergygroup.co.uk/

Notes to editors

·      Good Energy is a licensed electricity supplier. It ensures that all of its customers' demand is 100% matched with electricity from renewable sources over the course of 12 months, backed by Renewable Energy Guarantee of Origin certificates (REGOs). 

·      Good Energy Group plc is listed on the AIM market of the London Stock Exchange.

·      Good Energy has over 40,000 renewable electricity customers and more than 15,000 gas customers (31 Dec 2013). It works with a community of more than 59,000 small and medium scale renewable electricity generators (31 Dec 2013).

·      Good Energy is the owner of Delabole Wind Farm, the UK's first commercial wind farm.

·      It has targeted the development of 110MW of capacity of new renewable electricity generation assets by 2016.

·      Good Energy is a founder member of the Social Stock Exchange.

·      Good Energy came joint first in the latest Which? Customer Satisfaction Survey for energy suppliers, and has held first place in 4 of the last 5 years.  It won Company of the Year in the British Renewable Energy Awards 2013 and was named as the best green electricity supplier 2013 by the UK's leading ethical and environmental magazine, Ethical Consumer.  Most recently, it won Best Utilities PLC 2014 in the UK Stock Markets Awards.

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