Letter from the CEO
The third quarter was the first full quarter with Magnora’s new structure: a lean renewable energy business in a harvesting phase, and a separately listed data center company, Magnora Data Center ASA, in which Magnora owns 52%. The new structure is working as intended. In renewables, costs are low and the value realised through project sales proceeds will be reflected in our results. In data centers, growth and value creation continued at a high pace, and we see many opportunities ahead. Our financial position is solid.
At the end of the quarter, the Group held NOK 742.1 million in cash, in addition to a NOK 150 million credit line. Group operating expenses were NOK 11.3 million in the quarter, down from NOK 13.2 million same quarter last year, reflecting optimisation, cost reductions and more selective growth.
Our renewable energy portfolio remains above 10 GW, and we maintain strict capital discipline, prioritising our most advanced and highest-value projects. We continue to see strong interest from power producers and infrastructure funds in projects with a clear path to grid connection and low permitting risk. We expect to sell one to two projects or clusters per year through 2033, increasing as grid capacity expands.
In South Africa, the projects sold to Globeleq in 2023 are progressing well. Construction of the 153 MW Red Sands project is underway, showing that Magnora-developed projects are moving through construction towards operation. The Phula PV solar-plus-storage project has received its grid offer (Cost Estimate Letter), an important milestone that is expected to trigger further earnout payments to Magnora as the project moves forward. In September, our South African subsidiary, African Green Ventures, also launched a data center strategy, bringing the Group’s data center expertise into one of our core renewable markets.
The data center business continues to draw strong attention from investors, customers and partners. The project portfolio grew from gross 650 MW at the end of the second quarter to gross 910 MW at the end of the third quarter. In August, Magnora Data Center agreed to establish a joint venture with Blix Group to develop an additional data center in Oslo. It also took full ownership of the Hämeenlinna project in Finland. With a signed grid connection agreement and a Letter of Intent with the local utility for additional power, cooling and district heating, Hämeenlinna is now sales-ready. In September, the company acquired a 50% stake in a joint venture to develop a data center of up to 180 MW in Risti, Estonia, and signed a collaboration agreement with a partner that will support the sales process for its project in southern Sweden (SE4).
With a lean renewable business and a fast-growing data center company, Magnora is well positioned for its next phase. We will stay focused on turning projects into value, and I look forward to sharing our progress in the coming quarters.
| Erik Sneve, CEO |