Scatec ASA Aktie

Good morning, and welcome to our second quarter presentation for 2026. The second quarter has been a good quarter with several important milestones that we have been achieving. We continue to deliver on our strategy. to drive value-creating growth at a high pace across our geographies.

So during the quarter, we have continued to move projects into operation. We have started construction of new projects, and we have also moved new projects into backlog. And we continue to see demand for renewable energy continuing to grow. And Scatec is operating in countries with strong and increasing underlying demand for clean, reliable and affordable renewable energy.

And renewable energy is the most competitive source of energy in the markets where we are operating. And this is based on continued cost reductions and technology innovations across all the technologies, solar, wind and batteries. And based on this, we can deliver not only intermittent energy, but also flexible energy and baseload energy at competitive prices in the markets where we are operating.

Further, with the ongoing challenging situation in global energy markets, long-term predictability and energy security is increasing in importance. And this will also continue to drive the demand for renewables in our markets. And as a result, we see the intention now to accelerate the energy transition for economic reasons. And the case for renewables is becoming very strong and evident for key stakeholders and government officials and decision-makers in the markets where we are operating, and we continue to see the clear intention to accelerate the transition towards renewable energy in these markets.

So I will take you through the highlights of the quarter. Hans Jakob will take you through the financials, and then we will come back and take questions at the end. Our growth momentum continues. And during the quarter, we reached commercial operation for 3 projects totaling 705 megawatts of solar and 16 megawatt hours of battery storage. A major milestone for us towards reaching COD on the full Obelisk project, the Phase 2 of the Obelisk project. And this was done ahead of schedule and well within budget, and I will come back to this shortly.

On financials, we delivered proportionate revenues of NOK 2.3 billion and EBITDA of NOK 1 billion. And in our D&C segment, we recognized revenues of NOK 1.2 billion with an EBITDA of NOK 234 million, representing also and based on the gross margin of 24%. And this strong result is again a demonstration of the integrated model, the strength of the integrated model and the strength of our execution capabilities. We also have a record high backlog and near-term growth.

And with the current backlog that we have, we are in a position to double our generation capacity over the next 2 to 3 years. And it is encouraging to see progress across all main technologies, solar, wind and battery storage, also across multiple countries and multiple geographies. And all of these technologies, as I said, will form part an increasing part of the future energy systems. And it's great to see that we continue to build experience, capabilities and track record across all of these technologies.

And this morning, we also announced the intention to refinance our most expensive corporate financing, and this is in line with our strategy to continue to take down debt on corporate level and continue to reduce our financing costs. So reaching COD for the Obelisk project is a major milestone for us and obviously, a very proud moment for us. Obelisk is the largest renewable energy project in Africa. We expect it to produce more than 3 terawatt hours of energy annually. And we also expect it to contribute by reducing CO2 emissions in the range of 1.3 million tonnes annually. And again, this project is evidence of the strength of the integrated business model.

With the integrated business model, we are able to move swiftly from development and into construction. We're able to control the quality and the pace of construction during the execution phase, and we are able to extract value creation in a capital-efficient manner through the project. So Obelisk reached COD ahead of schedule and below the construction budget.

And from our signing the PPA in September 2024, we took around 9 months to get the financial close and notice to proceed, 17 months to reach Phase 1 COD, including 100% of the battery storage capacity and 23 months to reach COD for the full plant. This is a remarkable achievement of our team and also of our partners, and it's also evidence of the speed of deployment possible when it comes to renewables, which is a strong benefit of renewables.

And you will also see based on our communicated numbers, the D&C margin that was communicated when we started the project was sufficient to cover the 40% equity stake that we currently have sold down to in the project. So we're also, from that point of view, capital neutral. And this is obviously before the additional value capture that we have achieved through strong and disciplined execution and the ability to also release contingency and reduce costs in the project.

And looking forward, our intention is to apply the same model and the same approach to the next 3 projects that we have secured in Egypt. So these projects are, first of all, what we call the Dandara project, the project with Egypt Aluminum, which is in principle a copy of the Obelisk project, 1.1 gigawatts and 200 megawatt hours of batteries, where we will deliver energy to Egypt Aluminum, which is the largest aluminum producer in Egypt and the largest energy consumer in Egypt.

So this is the first project and it's the first private PPA in Egypt that also has a sovereign guarantee backing. Then we have Energy Vale, where we signed the PPA in January this year, about 2 gigawatts of solar and 4 gigawatt hours of battery storage. This is a project where we will install battery storage at specific points in the grid where there is scarcity of grid capacity. And on top of this, this project will also be able to deliver part of the energy on a 24/7 basis.

And finally, we also have the 900-megawatt Shadwan Wind project. And all of these projects, the 3 projects, we have an intention to reach financial close and start of construction over the next 6 months. So this obviously represents a substantial pipeline that builds directly on the capabilities, the experiences and the partnerships that we have been building in Egypt over the last couple of years.

Power production came in at 1.1 terawatt hours in the quarter. This is up 21% from 940 gigawatt hours in the same quarter last year. And the growth is primarily driven by new projects entering operations, which contributed to 278 gigawatt hours in the quarter. And over the last 12 months, a number of projects have reached operations, COD, we have Grootfontein in South Africa.

We have the Mmadinare Solar Complex in Botswana. We have 2 projects in Tunisia, Sidi Bouzid and Tozeur. And obviously, we also have the Obelisk project in Egypt. On the other side, we did see lower production from existing power plants in the Philippines, Ukraine and South Africa, which partly offset the contribution from those new projects.

Turning to revenues. Power production revenues came in slightly above NOK 1 billion, and this represents a 4% reduction relative to the same quarter last year after adjusting for the one-off effect that we had in the Philippines related to the tariff adjustment last year. And new projects contributed then to NOK 83 million in revenues, and this was offset by a few specific nonrecurring effects, especially in Ukraine and South Africa.

So in summary, the growth portfolio is now starting to contribute in a meaningful way as more projects reach COD over the coming quarters, the new project contribution will continue to build, and we expect a growing and increasingly resilient generation base going forward.

Let me now also make a couple of comments on our position in the Philippines through SNAP, our JV with the Aboitiz Group. And in the Philippines, we delivered a good quarter. And here, we continue to prove the robustness of our hydropower and battery storage portfolio that we are having here. On volumes, the generation was lower due to hydrology and the early effects of the El Nino with power produced only at 64 gigawatt hours relative to the 106 gigawatt hours that we had in Q2 last year.

But despite significant lower water inflow and generation volumes, we're still able to generate NOK 244 million in revenues in the quarter relative to the NOK 262 million in revenues that we had last year in the same quarter, and we also had an EBITDA of NOK 201 million in the quarter. And this speaks to the value of our flexible diversified generation portfolio, the ancillary services position and the merchant operations capabilities and the trading capabilities that we are having in SNAP.

Ancillary services contributed to NOK 199 million in terms of revenues, while contract and spot energy revenues represented NOK 45 million. Also, spot prices in the quarter was significantly higher than what we had same quarter last year with PHP 9.6 per kilowatt hour relative to PHP 6 per kilowatt hour last year. And we've also seen that prices in the ancillary services market continued to be strong during the quarter.

Obviously, we will come back to the outlook, but the probability of a strong El Nino going into Q4 and also into 2027 is still quite high. On the other side, we also expect that prices will continue to stay elevated across both energy and ancillary services. And also by the end of the year, we are targeting to add more battery storage capacity to the portfolio.

So then turning to D&C. We have also had -- or we have had very strong performance in the D&C segment in the quarter. In terms of the construction portfolio, we currently have 792 megawatts of solar, 77 megawatts of wind based on the announcement that we did yesterday evening and 571 megawatt hours of battery storage under construction across 6 markets. This is a high quality and well-diversified portfolio.

On financial performance, we delivered a D&C gross margin of 24%, including the contingency release in Obelisk and with the underlying margin still at a solid 11%. On project milestones, Obelisk Phase 2, Rio Urucuia and also Magat BESS 2, all reached commercial operation during the quarter, while Sidi Bouzid II in Tunisia and Urleasca in Romania have started construction, adding 120 megawatts of solar and 77 megawatts of wind to our construction portfolio. And now the remaining contract portfolio has a value of NOK 3.8 billion.

So we still have significant secured revenue outlook in the D&C segment, and we continue to expect 10% to 12% at least gross margins across the portfolio. And looking ahead now, we expect Mogobe BESS and Binga BESS are the 2 best projects in South Africa and in the Philippines to reach commercial operation by the end of this year with 4 additional projects to follow in the first half of 2027 across the Philippines, Colombia and also South Africa. And I'm very pleased by the construction progress of the projects across our portfolio. And I think our team is doing a tremendous job in keeping control and pushing these projects forward in a disciplined way.

So let me also now walk you through our growth portfolio. So we now have reached 5.7 gigawatts of generation capacity in operation. And this is following the completion of Obelisk and Rio Urucuia, and this is up from 5 gigawatts just 1 quarter ago. We now have 0.9 gigawatts under construction and a backlog of 5.8 gigawatts. And together, this gives us a near-term portfolio of 12.3 gigawatts, representing a more than 100% growth that we target to realize over the next 2 to 3 years in terms of generation portfolio.

Then on battery storage, the growth is even more striking. We have 1.4 gigawatt hours in operation and 0.6 gigawatt hours in construction. And on top of this, we have a backlog of 4.8 gigawatt hours. So this brings the near-term portfolio in terms of battery storage to 6.8 gigawatt hours, and this is almost 5x what we have in operation today. And this reflects the strategic importance and competitiveness of battery storage in the power systems, and it will represent an important value creation tool and area for us going forward.

And behind this near-term portfolio, we also have a pipeline of 5.9 gigawatts of generation capacity, and we also have a pipeline of 2.4 gigawatt hours of additional storage. And this provides further growth potential and visibility beyond our backlog. And obviously, behind this again, we continue to work actively on new project opportunities across our markets.

And as I said, we target to realize the projects under construction and in backlog over the next 2 to 3 years. They are all meeting our hurdles, and they have attractive returns and margins and can be realized in a capital-efficient manner based on the integrated model that I have already talked about.

Now let's take a look at what we are doing in Romania. So Romania is emerging as a very promising growth market for renewables. And I want to take you through some of the rationale behind our investments there. Firstly, Romania represents a market with attractive renewables growth potential. The market currently has strong tailwinds and significant renewable energy targets in the range of 8 gigawatts.

The drivers for renewable energy growth in the market is obviously increasing electrification, the fact that they are phasing down and have a target to phase down on coal. They have a dedicated CfD scheme, contract for differences scheme for renewables. And this is a scheme which is being backed by the EU and funded by the EU. And on top of this, there are also incentives for storage. Secondly, the market offers contracted and predictable long-term revenues.

The CfD scheme enable long-term cash flows in hard currency, and this obviously enables us to use our traditional model and secure nonrecourse project finance backing these projects. We are also able to implement our traditional integrated model so that we can also, over time, capture value through D&C and other services. And then finally, Romania also offers opportunities for additional value creation beyond the contracted cash flows.

In Romania, there is a merchant energy market with attractive prices and in addition, price volatility across both the energy sales and also across ancillary services. And we can capture value from this based on a flexible and diversified portfolio of solar, wind and battery storage. And battery here is an essential element to the total portfolio. And obviously, our experience also with operating in merchant markets that we have, for instance, from the Philippines is also something that we can transfer into upcoming growth markets like this one in Romania.

So now we have 3 projects in Romania. We have Dobrun and Sadova, 190 megawatts of solar and Urleasca Wind of 77 megawatts of wind that we already have in construction. And today, we are also announcing that we have included Buciumi, a best project of 178 gigawatt hours into our backlog, which we will also target to move into construction relatively soon. So this comprises a portfolio of projects with attractive contracted long-term revenues.

At the same time, as we have the flexibility in the portfolio to protect ourselves from downside and to capture upsides in the energy market based on volatility of prices. So this forms a strong initial platform for further growth in a market where we see significant opportunities for further value creation going forward.

So with that, I will hand over to Hans Jakob to take us through the financials.

Thank you, Terje. We delivered strong results across the group with high D&C activity in a good quarter also in the Philippines. I'll walk you through the group financials and the performance of our operating segments, and I'll also cover the improvements in our capital structure.

Looking at the quarter on group level, we continue to generate solid revenues from our D&C activity with positive effect on proportionate financials. Consolidated revenue was NOK 1.37 billion compared to NOK 1.3 billion in the same quarter last year. This includes NOK 255 million in construction revenues related to our Lyra JV in South Africa, which has a lower EBT margin than our power-producing assets. EBITDA reached NOK 824 million compared to NOK 1 billion.

The change is mainly driven by a one-off effect in the Philippines in the same quarter last year. Our proportionate revenues was NOK 2.3 billion, in line with the same quarter last year, and the proportionate EBITDA was NOK 1 billion compared to NOK 1.1 billion year-on-year.

Now take me through the -- let me take you through the segments, starting with Power Production. We delivered revenues of NOK 1 billion compared to NOK 1.3 billion in the same quarter last year. This was mainly explained by the one-off in the Philippines of NOK 231 million last year related to the new ancillary services tariff. The EBITDA was NOK 805 million. And for the last 12 months, we have delivered NOK 4.2 billion in revenues and NOK 3.2 billion in EBITDA. The difference is mainly explained by the reduced revenues from divested assets and the one-off in the Philippines. Overall, we are very pleased with the value generated from our operating assets.

Moving to Development & Construction. We have high activity and the proportionate revenue was NOK 1.2 billion compared to NOK 976 million last year. EBITDA was NOK 234 million compared to NOK 49 million. This was driven by NOK 160 million contingency release from Obelisk Phase 2. The contingency release is a result of timely and cost-efficient execution of the project.

The trend from the last 12 months confirm the long-term strength and scalability of our D&C business. D&C revenues in the last 12 months was NOK 6 billion with a steady increase over the last 5 quarters. Rolling EBITDA ended at NOK 720 million with a contribution from high-margin projects, contingencies and what I call disciplined cost control.

Looking at free cash on group level, free cash position ended at NOK 1.6 billion in the quarter due to the following movements. We received NOK 334 million in distributions from power plants, generated NOK 211 million EBITDA from D&C and corporate, had NOK 873 million of reversal of working capital, mainly related to Obelisk and paid NOK 215 million of interest.

At the end of the quarter, we have invested approximately NOK 800 million of equity in our growth projects. We have also increased our RCF from $230 million to $350 million at improved terms. The increase is limited -- the increased limit provides a solid liquidity buffer and will support the execution of our record high near-term growth portfolio across geographies. Following the new RCF, we have a total available liquidity of NOK 5.1 billion, which provides a solid buffer and to deliver on these strategic targets. I would like to add a thanks to the banks for the cooperation.

Looking at proportionate net debt, which has -- first, starting with the gross corporate debt that was reduced to NOK 6.4 billion, while the net interest-bearing debt increased due to the reduction of cash, mainly driven by changes in working capital and investments. Over time, we have significantly reduced the debt on corporate level to increase financial flexibility and reduce interest costs.

On project level, gross debt increased by NOK 100 million to NOK 19.6 billion due to new growth projects. Net debt for projects under operation was reduced by NOK 200 million and net debt for projects under construction increased by NOK 200 million and the cash held at SPV increased by NOK 200 million to NOK 3 billion.

Let me now take you through the bond refinancing activity, which is an important part of our strategy to strengthen the balance sheet and reduce financing costs over time. As you can see from the chart, we currently have 4 outstanding corporate bonds. SCATC 04 matures in '27 and carries out the most expensive margin at 660 basis points over 3 months NIBOR. We are planning to refinance this bond with a new expected NOK 1 billion bond issue, which will extend our maturity profile to 2031 and at improved margins. This is a rather straightforward and value-creating transaction as we are replacing our most costly debt with longer-dated financing and at better terms. The broader picture is encouraging.

Looking across our bond stack, you can see a clear downward trend in financing costs as we have grown and strengthened our credit profile. SCATC 05 carries 425 basis points margin, SCATC 06, 315 basis points and SCATC 07, 285 basis points. You get my point. This trend is progress that we have made by reducing also the risk and improved financial discipline. The overarching strategy is clear. Scatec is committed to reduce corporate debt and interest expenses over time, and the refinancing is a concrete step in this direction.

Now let me take you through the outlook. We are maintaining our full year EBITDA guidance. In our Power Production segment, we estimate a full year power production between 505 and 535 terawatt hours, which is 50 gigawatt hours lower than the previous estimate due to lower expected hydrology in the Philippines. Our estimated full year EBITDA is kept at the midpoint of NOK 375 million as the lower production is expected to be offset by higher reserve market prices. We have not made any adjustments to FX this quarter as the quarterly FX effects are limited.

For the third quarter, we expect a total power production between 1,500 and 1,600 gigawatt hours and EBITDA in the Philippines between NOK 320 million and NOK 420 million. In our D&C segment, the remaining contract value, as Terje said, is NOK 3.8 billion, primarily related to Thakadu in South Africa, Barzalosa in Colombia and Sidi Bouzid II in Tunisia.

The estimated gross margin is unchanged at 10% to 12% on average across the portfolio of projects under construction. For corporate, the expected full year EBITDA is unchanged at NOK 125 -- NOK 135 negative. And these estimates reflect a strong base of operating assets, high construction activity and a healthy cost control.

And then I leave it to you, Terje, to take us through the summary.

Thank you, Hans Jakob. And in summary, we are continuing to have an all-time high growth portfolio that we will continue to drive towards financial close and into construction. And this is going to, as we have said, make us -- put us in a position to double our capacity over the next 2 to 3 years in terms of generation and increase our capacity in terms of battery storage by 5x over the next 2 to 3 years.

And we have now, I believe, proven our execution capabilities in Egypt and across all the countries where we are operating. And we are, from an execution point of view, also ready to target this portfolio and move into construction across these different projects.

And finally, we have also the financial flexibility. We are continuing to strengthen our financial position and increase our financial flexibility in terms of moving forward and managing this portfolio. So I believe that we are in a very good position to drive now this growth going forward.

Thank you. And then I think we will open for Q&A.

Thank you, Terje, Hans Jakob. Yes, we will then open up for Q&A. We will start with questions in the room here, and then we have a number of questions also from our online listeners. So if you would like to ask a question, just raise your hand.

Yes, Andreas.

Andreas Nygard, Nordea. One question on the FIDs you're expecting to reach in the second half of '26. You're now having a NOK 3.8 billion contract backlog for D&C. If you reach FID, what are you expecting to add to this contract backlog in the second half of this year?

Yes, we haven't provided any guiding beyond the contract value. So we will have to come back to more specifics. That's the short answer to that.

Okay. And then a second question for me. Data centers, is that something that is currently in your pipeline?

Data centers is not in the pipeline specifically. And obviously, it always depends on what is included when you ask data centers in our pipelines. Clearly, data centers is also being planned and developed in the countries where we are operating and will contribute to the demand for renewable energy also in the markets where we are. So we do absolutely see benefits also from us from the current growth in data centers on a global basis.

And given that you're on the ground, for instance, in Egypt and South Africa, how have the discussions surrounding data centers evolved over the last 6 to 12 months? And what is the potential scale for potential clients of yours with that regard?

I think we are not going to sort of provide any speculation on that now. We obviously, as I said, we do see that data center activities moving also in our region and in our countries. And then we will rather come back to that more specifically when there are something concrete on that.

Anyone else would like to ask a question? In the room? No. Then we go over to the questions from our online listeners. We have one question about Egypt Green Hydrogen. What is the latest on Egypt Green Hydrogen? When is an FID expected? And are you on schedule for the deliveries planned under the H2 Global mechanism?

Yes. On the EGH project, together with our partner, Fertiglobe, we have everything prepared for that project, and we are now awaiting certain clarifications in terms of regulations from the EU. And subject to getting those, we will be able to move forward, and we will also be able to meet the contract obligations that Fertiglobe has towards H2Global.

A question about El Nino in the Philippines. Can you talk about the expected impact of El Nino and potentially super El Nino on the Philippines business and other geographies such as Brazil?

I think all our current perspectives on El Nino and weather in general are included in our outlook and our guidance in terms of what we are seeing going forward. And as we've said in the presentation today, the probability of a strong El Nino in -- towards the end of this year and beginning of next year is still high. But also as we have been presented when it comes to the Philippines, we have a technology portfolio and there is flexibility in terms of how we operate in that market. So there are other ways of managing that portfolio.

Thank you, Terje. Well, 2 questions from Jørgen Lande. With the Obelisk project delivered well into Q3, should we expect further contingency releases also in Q3?

So yes, obviously, this is our Q2 report, and we released quite a lot of contingencies now at the end of Q2, but we were still not finished with the project at the end of Q2. So whether or not there will be any additional, that's subject to completing the project and having no surprises now towards the end.

Another one about Egypt. With the Obelisk project now delivered, your construction team in Egypt is idle. What are the remaining factors to decide on reach before you can start construction on Energy Valley and/or Egypt Aluminum?

From a permitting point of view and from securing everything that we need to move forward on those projects, everything is in place. What we are currently obviously working on now is preparing the EPC part, the execution part as well as completing the processes with the lending banks to make sure that we get through and finalize all agreements with the lenders that we finalize the DD with the lenders, due diligence with the lenders. And that is a certain process that we need to get through some of the lenders also have disclosure periods that we have to wait for.

So once all of these things, which I consider more of administrative activities given that we have been through them many times before, we are -- we will be ready to reach financial goals.. And as I've said, we expect that to happen for all these 3 projects over the next 6 months.

Two questions from Anis Zgaya. Given the increase in consolidated net interest-bearing debt and the decline in total liquidity on a consolidated basis, could you provide more detail on the expected trajectory of net debt and liquidity over the second half of 2026, including contribution from project distributions, working capital and potential asset rotations?

Yes, I think I will repeat what I said in the first quarter that this will vary over time as the activity is high. So overall, we have a strong liquidity position, and we also have the increased RCF. So -- but the trend is the debt has been reduced over time, but NIB will vary with cash and working capital as happened in this quarter.

Could you walk us through the accounting of the Thakadu construction contract? So we included NOK 255 million of revenues in the consolidated accounts. So just explain a bit of the effects there.

Yes. Lyra is not a consolidated entity. So when it's not a consolidated entity, the revenues under EPC contract is then recognized in the consolidated accounts. Unfortunately, according to IFRS, we are not able to include 100% of the margin in the consolidated accounts. So this is a specific. So we can only recognize 50% of the margin according -- in the consolidated accounts according to IFRS. So this is something for the ones that are deep into accounting.

One question on Colombia. What is your take on the new administration in Colombia? Do you anticipate any change in energy policy?

I'm not going to comment on sort of policy changes in Colombia now. I think it's too early. But so far, we have not seen any indications of change there.

Yes. It's another one also connected to this Thakadu project. I can just confirm that the cost of sales that we have in the consol is related to the Thakadu project.

That was the question.

With that, we've been through all the questions. I think then we end the presentation and thank everyone for listening. Thank you.

Thank you.

Thank you.

Good morning, everyone, and thank you for joining us for our first quarter presentation for 2026. It has been a strong quarter with a high activity level, and we continue to deliver on our strategy to drive growth at a high pace across our geographies. And at the same time, we also continue to strengthen our financial position. In the quarter, our operating portfolio has increased as several projects have moved into commercial operation. We have improved near-term growth visibility with new projects reaching both backlog and also reaching into construction. And finally, we have also strengthened our liquidity and have reduced our corporate debt. And our available liquidity currently stands at NOK 6.1 billion. On the market side, demand for energy is growing and Scatec is operating in countries with strong and increasing underlying demand for clean, reliable and affordable renewable energy.

And renewable energy is the most competitive source of power generation in our markets, and we continue to see attractive long-term market opportunities and now more than ever as energy security is increasingly becoming important. So today, I will start by going through a bit on the macro situation. I'll then go through the highlights of the quarter. Hans Jacob will go through the financials. And then at the end, we will open up for questions. So in terms of the macro situation, focus on energy security and cost competitiveness reinforce the case for renewables. As shown to the left, many of our core markets remain highly dependent on imported fossil fuels, which increases both cost and supply risk.

Recent geopolitical developments and a significant increase in the price of fossil fuels have reinforced this dynamic. And this is a stark reminder of the risk of being exposed to fuel imports and is driving an increased focus on domestic, reliable and predictable energy sources. And at the same time, economics are clearly moving in the favor of renewables. To the right, you can see that solar and wind are the most competitive sources of power and with declining battery costs, renewable energy is able to also deliver dispatchable and baseload type of power.

The recent developments in fossil fuel markets will strengthen the case for renewables. And renewables demand is no longer only driven by sustainability. It is driven by energy security and cost competitiveness. And this is expected to accelerate deployment of renewables across the globe, and Scatec is uniquely positioned in high-growth import-dependent markets where the need for affordable and reliable power is the strongest. And in our markets, we are delivering energy faster, cheaper and with greater reliability than the conventional alternatives. Egypt and our 1.1 gigawatt Obelisk project is here a clear example. With strong execution and diligent cost control, we have advanced the project from PPA signing to operations in less than two years. We are already supplying electricity to the Egyptian grid from the first phase of the project. And at the same time, Egypt still relies on gas for close to 90% of its electricity, leaving it highly exposed to expensive LNG imports.

At current gas prices, our project, the Obelisk project will deliver significant annual savings in the range of $300 million on an annual basis. And this is before we also consider the volatility and supply risks associated with fossil fuels imports. And as a reference, remember that the total CapEx for Obelisk project is in the range of $600 million.

So from a mathematical economical point of view, we're talking about a two-year payback on the investment. And this fact is also clear to the authorities in Egypt and also in other countries and other markets where we operate, and they look to increase targets and accelerate the deployment of renewables. And overall, as I said, this is not only about sustainability any longer, but providing cheaper power, faster delivery and improved energy security. This is a combination I see as a strong driver of growth for Scatec going forward. Now let me take you through the highlights of the quarter. We delivered group revenues of NOK 1.6 billion and EBITDA of NOK 774 million. We've had good progress on our projects under construction, and we recognized NOK 695 million in revenues and NOK 100 million in EBITDA.

And this quarter, we realized a gross margin in the D&C segment of 22%, and this is due to a contingency release of NOK 80 million, which is related to the completion of the first phase of the Obelisk project in Egypt. And the underlying gross margin in the D&C segment continues to be in line with our guidance. Further, our growth engine continues to run at high speed. We finalized construction of three projects during the quarter in Egypt and in Tunisia. In total, 683 megawatts of solar capacity and 200 megawatt hours of battery storage capacity. This increased our total capacity under generation now to more than 5 gigawatts. We also started construction of another five projects across South Africa, Colombia, Romania and the Philippines in total, 575 megawatts of generation capacity and 80 megawatt hours of battery capacity. And finally, we also strengthened our financial position. We're paying $30 million on our vendor financing, and we renegotiated our RCF at improved terms. This brings our total available liquidity, as I said, to NOK 6.1 billion. With that, let's look at the Power Production segment. We generated 1,046 gigawatt hours in the quarter. This is up from 881 gigawatt hours last year after adjusting for divested assets. New projects contributed with 241 gigawatt hours.

This is from the Mmadinare project in Botswana, Grootfontein in South Africa, also Sidi Bouzid, Tozeur in Tunisia and the first phase of Obelisk in Egypt. Revenues from power production amounted to NOK 929 million. This is down from NOK 1.1 billion same quarter last year, excluding divested assets. In terms of underlying operations, new projects contributed with NOK 68 million during the quarter in terms of revenues, while we had lower revenues in the Philippines compared to a very strong quarter last year.

The revenues in the quarter, they were also impacted by several specific events. One power plant in Ukraine continues to be out of operation and our Apodi plant in Brazil experienced some downtime during a lightning strike. We reversed an accounting gain of NOK 56 million related to the divestment in Vietnam as payment conditions for this earn-out was not met. While in the same quarter last year, we recognized a positive one-off related to a tariff true-up. And finally, we also had a negative FX effect relative to last quarter as the NOK has strengthened against our main operating currencies. So in summary, our large growth portfolio is starting now to enter operations. And going forward, this will contribute to growing and even more resilient portfolio of contracted revenues going forward.

Let me now turn to the Philippines. We continue to see significant strength of having a flexible portfolio shown by the financial contribution from the ancillary services also this quarter. Power production decreased by 28% to 107 gigawatt hours in the quarter, while revenues by comparison only fell by 13%. Revenues reached NOK 279 million and EBITDA ended at NOK 231 million, which is at the higher end of the guided range. Philippines is a strong cash-generating market and now with four energy storage projects in construction, we continue to add battery capacity to the attractive ancillary services market to strengthen our position going forward here.

Then in terms of construction, we currently have 1.4 gigawatts of solar and 587 gigawatt hours of battery storage projects under construction. This also includes the release platform, where we continue to see very strong progress. Since last reporting, we've had a very good construction progress across the portfolio. We recorded, as I said, D&C revenues of NOK 695 million, and this is largely driven by the progress we've seen on the Obelisk project as well as on the Mogobe BESS project. As I said, gross margin came in at 22%. And after reaching commercial operation for the first phase of Obelisk, we released a contingency of NOK 80 million. This is reflecting the cost-efficient and swift execution that we've had on this project. Adjusting for this, the underlying gross margin was 11%, and this is in line with our communicated targets. Also Sidi Bouzid, Tozeur in Tunisia came into operation during the quarter, adding another 120 megawatts into our operating portfolio. And looking forward or looking forward to the second quarter this year, we also aim to reach COD for both Urucuia in Brazil, as well as two battery storage projects in the Philippines.

As for the rest of the construction portfolio, we expect to see a steady flow of new projects coming into operation over the next 12 months. I'm very pleased with the progress that we're currently seeing on the construction area and incredibly proud of the teams, the large teams that are making this happen. And at the end of the quarter, the remaining contract value that we have in the D&C segment has increased to NOK 4.2 billion, up from NOK 1.8 billion at the end of last quarter. So we also see that, that is increasing as we move projects into construction. And we expect to continue to realize a gross margin of 10% to 12% on this portfolio. And behind this, obviously, we continue to have and we continue to mature additional projects that will move into construction also over the next quarters. So now let's also take a look at Lyra. And during the quarter, we announced construction start for our first project in the Lyra JV, the 255 megawatts Thakadu project. And we have established the Lyra platform together with our local partners, STANLIB and Standard Bank, and it's an important part of how we are positioning ourselves for the future in the South African market.

Through the platform, we seek to capitalize on the ongoing deregulation in the power sector in South Africa. And in Lyra, we are able to build a scalable platform for power production and PPA aggregation. This allows us to serve multiple C&I off-takers at attractive tariffs, and this is compared to our traditional model in South Africa with public tenders and Eskom as the sole off-takers. And we expect both these parts of the market to continue and provide significant opportunities going forward. The Lyra platform benefits from Scatec's development, EPC and operational capabilities, and we extract margins from providing these services to the platform. At the same time, we benefit from strong financial partners, which provides equity and debt funding for the project at pre-agreed terms. So this is a model that allows us to grow with limited balance sheet exposure while still capturing value across the full value chain of our activities. And importantly, it positions us well to benefit from what we see as a structural shift in the South African market going forward.

So let us then also have a look at our growth portfolio. We have an all-time high backlog of 5.9 gigawatts of generation capacity. This includes projects mainly in Egypt, South Africa, Tunisia and the Philippines. And when the construction and backlog projects have been completed over the next few years, we will reach more than 12 gigawatts of generation capacity.

This is increasing our capacity relative to what we have today by almost 2.5x. In addition, behind this, we have a pipeline also of 5.9 gigawatts of projects that also will mature over time and contribute to future growth. In addition to our growth portfolio, it now also on generation capacity, it also now includes battery storage. These are either in hybrid projects or as stand-alone installations. And here, we have a backlog of 4.6 gigawatt hours also across South Africa, Egypt and the Philippines.

Together, this project pipeline provides great visibility on significant value-creating short-term growth. And we will continue to grow on a self-funded basis, and we will continue to stay disciplined relative to our return requirements. So with that, I will hand over to Hans Jacob to take us through the financials.

Thank you, Terje. And we delivered a strong results across the group, high D&C activity and a good quarter in the Philippines. I'll walk you through the group financials and the performance of our operating segments, and I will also cover further improvements to our capital structure. Looking at the quarter on group level. We continue to generate solid revenues from our D&C activity, which has a positive effect on the proportion of financials. Consolidated revenues was NOK 1 billion compared to NOK 1.8 billion in the same quarter last year. The EBITDA reached NOK 729 million compared to NOK 1.5 billion, and the reduction is mainly driven by the divestment gains in the same quarter last year. This is in line with our long-term self-funded strategy.

Our proportionate revenues was NOK 1.6 billion compared to NOK 2.4 billion in the same quarter last year, and proportionate EBITDA was NOK 774 million compared to NOK 1.4 billion year-on-year. Now let me take you through the segments. Starting with power production, revenues was close to NOK 900 million compared to NOK 1.6 billion in the same quarter last year, mainly explained by the divestment gains of NOK 426 million booked in the first quarter 2025. EBITDA was NOK 702 million. And the last 12 months, we have delivered NOK 4.5 billion in revenues and NOK 3.5 billion in EBITDA.

Overall, we are very pleased with the value generating from our operating assets. In the D&C segment, activity levels continue to increase. Proportionate revenues was NOK 695 million compared to NOK 751 million last year, and the EBITDA was NOK 100 million compared to NOK 26 million. This was driven by NOK 80 million contingency release from the Obelisk phase 1. The contingency release is a result of timely and cost-efficient execution of the project. The trend from the last 12 months confirms the long-term strength and scalability of our D&C business. D&C revenues in the last 12 months was NOK 5.9 billion with a steady increase over the last five quarters. Rolling EBITDA ended at NOK 535 million with contributions from high-margin projects, contingencies and disciplined cost control. Our free cash flow position ended at NOK 2.6 billion in the quarter, and this is due to the following movements.

We received NOK 94 million in distributions from power plants, generated NOK 72 million EBITDA from D&C and corporate, invested NOK 195 million in growth projects and repaid NOK 286 million corporate debt and paid NOK 109 million of interest. This is compared to NOK 165 million in the same quarter last year.

Following the quarter, we have refinanced our RCF at improved terms and increased the limit from $230 million to $350 million. The increased limit provides a comfortable liquidity buffer and will support the execution of our record high near-term growth portfolio across geographies. With the increased limit, we have a total available liquidity of NOK 6.1 billion, which provides a solid liquidity buffer to deliver on our strategic targets. We continue to strengthen our capital structure. Gross corporate debt was reduced to NOK 6.5 billion following a repayment of NOK 286 million of the vendor note. This is in line with our strategy to deleverage on corporate level to increase financial flexibility and reduce interest costs. On project level, the gross debt increased by NOK 0.4 billion to NOK 19.5 billion due to drawdown of debt on new growth projects.

Net debt for projects in operation increased by NOK 1.1 billion as Obelisk phase 1 reached COD during the quarter and net debt for projects under construction was correspondingly reduced by NOK 1.2 billion. Cash held in our SPVs increased by NOK 400 million to NOK 2.8 billion. Then having a look at the outlook. In our Power Production segment, we estimate a full year power production between 505 and 545 terawatt hours.

Our estimated full year EBITDA is reduced by NOK 200 million to a midpoint of NOK 3.75 billion, mainly due to NOK 150 million of negative foreign exchange effect as the NOK has strengthened against our main operating currencies. The largest effect relates to dollars, ZAR, and the Philippine peso. NOK 56 million reversal of the divestment gain related to the Vietnam earnout. And for the second quarter, we expect a total power production between 1150 and 1250 gigawatt hours and EBITDA in the Philippines of NOK 150 million to NOK 200 million. We note increased uncertainty in the Philippines due to global geopolitical developments and El Nino impacting the second quarter EBITDA estimate and the full year '26 proportionate EBITDA. In our D&C segment, the remaining contract value has increased by NOK 2.4 billion to NOK 4.2 billion as new projects are moved to construction. The estimated gross margin is unchanged at 10% to 12% on average across the portfolio of projects under construction. For corporate, the expected full year EBITDA is unchanged at negative NOK 125 million to NOK 135 million. And these estimates reflect a strong base of operating assets, high construction activity and healthy cost control. And then, Terje, I'll leave it to you to take us through the summary.

Thank you very much, Hans Jacob. So a couple of key points for the quarter. We continue to build and we now have an all-time high growth portfolio with 5.9 gigawatts of projects in backlog related to generation capacity and 4.6 gigawatt hours of energy storage projects. We've also shown that we have very strong execution evidenced through the fact that we have released NOK 80 million in contingency from the Obelisk project, and we continue to progress well on the projects that we have in construction. And finally, we are improving our financial position. We have paid down corporate debt as well as we have refinanced our RCF. And in summary, what we see currently is that the case for economics, the case for renewables is strengthening in the current situation, economics is competitive, and we can provide flexible, dispatchable energy.

We have an all-time high growth portfolio and the opportunities beyond this portfolio is also improving. And we also see that we have the financial flexibility to realize both this portfolio and further projects beyond this. So I believe that Scatec currently is in a uniquely strong position to continue to capture and realize value-creating growth. Thank you. Then we will open up for questions.

Yes. We will then move to the Q&A session. We will start with questions here in the room and then move on to the ones listening online. So any questions from the audience here in the room? -- seems to be no questions. So then we will move on to the questions from the online listeners. We have one question regarding the Obelisk, National Bank of Egypt coming in as a new owner. Following the transaction, National Bank of Egypt will have an economic interest of 20% in the project. What's the financial impact from this transaction?

Yes. So the National Bank of Egypt is coming in at pre-agreed terms before we reach commercial operation for the full plant. The way we look at this is that getting the National Bank of Egypt in as an equity investor is significantly derisking the project because they are taking dividends in local currency. And already when we started construction of this project, we have optimized the project in terms of the return levels that are acceptable for the other equity investors. There is no further accounting impact of this transaction beyond the fact, obviously, that our equity is being released back to us.

I also think it's a testimony of the attractiveness of this project that we actually have the National Bank of Egypt joining with equity. This is a fast-paced development project. It's a fantastic project ahead of schedule and very important for the Egyptian economy and the economic development in the area. So we are quite proud to have them with equity.

I mean, I have three high-quality co-sponsors in the project. We have obviously EDF from France that joined us into the project. We have Norfund here in Norway, and we now have the largest commercial bank in Egypt joining into the project as well.

Thank you. Next question from Jorgen Lande. Good morning. On the lowered power production guidance, what are the key factors lowering the full year production as Q1 production ended in the very high end of the guided range?

Yes. The key factors impacting our guidance for the full year it's mainly two things. One is uncertainty on the power production levels in the Philippines in the second half related to the potential El Nino effect. And the second element is the fact that the Ukraine project, which is currently out of operation is expected to come into operation a bit later in the year than we first had anticipated.

Another question from Sindre Sorbo. Could you elaborate why you're not notching up the D&C margin guidance?

The D&C margin guidance is based on the contracts that we have entered into on the EPC side, and they're based on the forecasted cost levels in those projects that we are constructing. Obviously, when -- obviously, in all of those estimates, there are some levels of contingencies as you would always do in the EPC business, and we will only release that when we see that the risks have been taken out of the project.

One question about our debt. You claim that you have reduced debt, but the total debt has increased. Can you elaborate?

Yes. I think he's referring to -- on project level, we have high gearing, nonrecourse project debt, and this will continue to grow with the success of the company growing. On corporate, you should expect lower debt as you also have seen in this quarter.

One question from Anders. Referring to our guidance and the uncertainty we mentioned there in the Philippines, asking what does that mean? Is that risk on the upside or the downside? Spot prices in the Philippines are up quite a lot.

That is correct. So with the -- as the suspension of the WESM market has been ended beginning of May, we -- on a short-term basis, we expect to see prices going up. And then I think it's difficult to foresee exactly how long this is going to last, including the war in the Middle East, which has a huge impact on prices. Currently, in the Philippines, we are in the drier part of the season. And when we move into May and June, we will come into the more wet part of the season. So obviously, how long the prices are going to stay high relative to when we get more water is going to impact how this is going to have -- how this is going to affect Scatec on the economic side and the financial side. So that's why we're saying the uncertainty is increased. And it's important to emphasize that it's also uncertainty on the upside, and it could also be positive effects from this.

A question from Anis Zgaya, ODDO BHF. On the Vietnam earn-out reversal, could you clarify what specific conditions were not met and whether this reflects timing issues or more structural shortfall versus initial assumptions?

Well, the specific element related to that was a reversal of a tariff reduction that the government in Vietnam implemented retroactively related to a project. And we will get paid more if that had been carried out. The reversal had been carried out, but it was not done so within the time zone that we had identified for that to happen.

Thank you. Another one from Anis. On FX, how should we think about sensitivities going forward? And how much of the NOK 150 million impact could be reversed if NOK weakens?

Well, I think the reference to FX in the quarter on consolidated, there was an FX loss of NOK 69 million. This was related to the relationship between euros and dollars. On the full-year guidance, we have corrected for the FX loss in the quarter. So hopefully, that was answering the question. Could you repeat it, Andreas, to make sure that we fulfilled?

Well, it's basically how much of the NOK 150 million that could potentially be reversed if the NOK weakens.

I don't think I have a specific number for that.

Okay. We have the next question also from Anis. New projects are ramping up nicely. Should we expect a more visible uplift in EBITDA contribution from these assets already in H2 2026? Could this offset FX impact?

Obviously, in our outlook for the year, we are taking into consideration that new projects will come online. So the projects that we are currently having in construction, they are all represented in terms of also the power production revenues for the year based on when we anticipate and when we have guided that those projects will come into operation.

I think that's the final question as of now. So with that, I think we end today's presentation, and thank you very much for listening.

Thank you.

Good morning, everyone, and welcome to our fourth quarter presentation. Our growth continues, and we deliver on our strategy with a high level of activity across all of our segments and all of our portfolio. We are growing our pipeline. At the same time, we continue to also strengthen our financial position. And we are operating in markets with strong underlying demand, and we're focusing on markets with strong underlying demand for clean, affordable and flexible power.

Renewable energy is the most competitive source of power generation in our markets, and we continue to see strong and attractive long-term demand for renewable energy in our markets. And this is reflected in the additional projects that we are able to secure in our markets, and it's also reflected in the growing pipeline that we are presenting today.

And today, I will start with a summary of our 2025 achievements, and then I will take you through the highlights of the quarter. Hans Jakob will go through the financials. And then at the end, we will also provide comments on our outlook for 2026.

And then to summarize our full year 2025, we are scaling the platform while maintaining -- continuing to maintain financial discipline, and we have also strengthened our balance sheet. We see strong near-term growth, and we have 11 gigawatts of generation capacity across our projects in operation, in construction and in our backlog. And this is our largest near-term growth that we have ever had.

We have also significantly strengthened our position in storage and hybrid solutions, reflecting the increasing demand for flexible and hybrid systems. Our growth portfolio now includes more than 6.5 gigawatts of battery storage systems. And this development is supported by battery prices falling over the past 2 years, and we aim to continue to increase our pipeline in this space.

During the year, we have also reduced our gross debt -- corporate debt by 25% and our corporate debt now stands at NOK 6.7 billion. And this is something that we have done while we continue to invest in new projects and new capacity. So overall, I'm very happy with the performance that we have achieved last year, and we are proving that we can execute on growth while we continue to deleverage, building a resilient and a very scalable platform.

So let me then take you through the highlights of the last quarter. We delivered strong group revenues of NOK 3.4 billion. This is an increase of 25% relative to the same quarter last year, and this is mainly driven by high activity in our Development & Construction segment.

We have very good progress on our projects under construction. And in the quarter, we recognized NOK 2.3 billion in revenues and also a gross margin of 14%. And the key drivers here were Obelisk in Egypt and also the Mogobe BESS project in South Africa. And it's important to emphasize that the attractive gross margin that we are recognizing, it is based on a very strong underlying economics of the projects that we currently have in our construction portfolio.

We also continue to mature our pipeline and secure new projects for future growth, with the backlog now reaching an all-time high of 5.3 gigawatts of generation capacity and 4.7 gigawatt hours of battery storage capacity. This is driven by new PPAs that we've been signing over the quarter in Egypt, in Tunisia and also in the Philippines. And one of these projects, which is Energy Valley, is really a landmark project in Egypt, and we will come back and talk a bit more about that later.

In parallel, we have also improved our corporate debt maturity profile. We have issued a new bond in November during the quarter. We also paid down the term loan. And at the end of the quarter -- at the end of the year, we have a very strong liquidity position of NOK 5.6 billion.

So with that, let me also then take you through the key elements of the Power Production segment. Last quarter, we generated 1 terawatt hours, and this is in line with last year when we adjust for the divested assets. New projects contributed with 73 gigawatt hours. This is from Grootfontein in South Africa and it's also from the Mmadinare project in Botswana. While when it comes to the Philippines, we generated slightly lower megawatt hours, and this is due to hydrology.

Revenues from power production amounted to around NOK 1.1 billion, and this is broadly also in line with last year when we are adjusting for the divestments that we've done. And overall, this demonstrates the resilience and the predictability of our contracted generation portfolio even as we continue to actively optimize our portfolio.

Now a few words on Ukraine. And here, the ongoing war obviously represents challenging environment, a challenging environment for operations. We own and operate 5 projects in Ukraine in the central and the southern parts of Ukraine, with a total capacity of about 336 megawatts. And during the fourth quarter, the substations and transformers related to one of our projects were targeted and damaged by Russian drone attack.

Our first priority in this situation is our employees in the country, and it's very good to know that those are unharmed at least physically after this drone attack. But the power plant is disconnected due to the damage and is currently not delivering energy onto the grid.

Ukrenergo, the state-owned utility and our team is working very hard to repair the damages, and we are currently targeting to get the plant reconnected to the grid and start delivering energy again in the beginning of the second half of this year. This is obviously impacting the power generation from Ukraine during the year, and Hans Jakob will come back and comment on this also in the outlook for the year.

So let me now talk about the Philippines. Here, we delivered yet another solid quarter, and the Philippines continues to be a major financial contributor to the company. We generated 249 gigawatt hours in the quarter. And despite the slightly lower generation compared to last year, the financials from Philippines were better than last year.

Overall, we reached net revenues of NOK 403 million. This is up from NOK 390 million same quarter last year. And here, we are now seeing the benefits of having a flexible asset portfolio and active trading operations in the country. This is now demonstrated based on the several -- as we have several revenue streams and that we're able to capture attractive trading opportunities. And through this, we are able to deliver good and strong financial results despite the fact that the hydrology is slightly lower in the quarter.

And we also continue to allocate a significant part of our capacity to the ancillary services market in the country, again, based on the fact that we are seeing attractive revenue opportunities, earnings opportunities in that segment and based on our ability with the flexible asset portfolio that we have.

Prices in the quarter were also up. And additionally, we've been able to capture higher-than-average prices on our contracts, and this is also contributing to the financials. So in terms of EBITDA, that increased by NOK 31 million in the quarter to NOK 363 million.

Then in terms of construction, we currently have 1.5 gigawatts of solar and 700 megawatt hours of battery storage projects under construction in 5 different countries. Andreas is fixing that. In addition to this, we are also progressing well in our release platform, and we are also having a few projects in that platform being installed as we speak.

Since last reporting, we've had a very good construction progress across the portfolio, and we have recorded NOK 2.3 billion in revenues and a gross margin of 14%, as I've already said. And the EBITDA for the D&C segment was NOK 251 million, which is a very high level. Grootfontein in South Africa and also the second phase of Mmadinare project in Botswana reached COD during the quarter and is now in operation.

In Tunisia, we target COD for the Tozeur project and the Sidi Bouzid project by the end of the quarter. And for the solar project in Brazil and also for our battery projects in the Philippines, we are expected to reach COD by the end of the first half of the year.

When it comes to Mogobe in South Africa, our first battery project in South Africa -- so when it comes to the solar project in Brazil and also the battery projects in the Philippines, we are expecting to have COD by the end of the first half. And then when it comes to Mogobe, our first stand-alone project -- stand-alone BESS project in South Africa, we are for this project expecting to reach financial close in the second half of this year.

In general, I'm very pleased with the progress that we're seeing on the construction activities across our portfolio, and I'm very proud of the teams that are doing a very good job on this. At the end of the quarter, we have NOK 1.8 billion in remaining contract revenues related to the projects that we currently have in construction, and we continue to expect to have a gross margin of 10% to 12% related to these projects. Beyond this, obviously, we continue to mature the projects that we have in backlog, and we foresee that we're going to continue to have a high activity level in the Construction segment going forward.

Now let me also take some time to appreciate our largest project to date, the Obelisk project. Total CapEx of this project is close to NOK 6 billion. And then it's finished, it will generate in the range of 3 terawatt hours on an annual basis, and it will provide 1.3 million tonnes of CO2 emission reductions. It's a massive project, and it's being constructed at record pace. We have already completed phase 1, which is including 50% of the solar capacity, 100% of the battery capacity and obviously also a very large substation. And this is only about 15 months since we signed the PPA.

We are having about 5,000 people on site, and this team is installing in the range of 200,000 modules on a monthly basis. So we're working very hard to secure commercial operation for phase 1 ahead of schedule by the end of this quarter and also accelerating the completion of phase 2, and we're targeting to reach COD for phase 2 already this summer.

And obviously, building this project, constructing this project gives us a lot of very valuable experiences and learnings. And we will use these learnings when we're now moving forward also and preparing to start construction for the other projects in Egypt, like, for instance, Egypt Aluminium and also the Energy Valley project.

I will now zoom out a bit and talk about our growth portfolio. We have an all-time high backlog of 5.3 gigawatts of generation capacity, and this is including projects in Egypt, in South Africa, in Tunisia, in Romania and in Colombia. And then the construction of these projects, including the ones in backlog, have been completed over the next few years, we will reach a total generating capacity of 11 gigawatts. This is up 2.5x relative to where we are today.

In addition, behind this, we have a pipeline of 7.4 gigawatts that obviously we will continue to mature and convert into backlog also over time. Our growth portfolio also includes battery storage, either in hybrid systems or as stand-alone storage systems. Here, we have a backlog of 4.7 gigawatt hours in South Africa, Egypt and the Philippines. And we have now chosen to show this portfolio separately so that you can see also how this is growing over time, and we believe that there's going to also be significant growth opportunities in this space going forward.

And let me now also turn at the end to a landmark agreement signed in Egypt, which is a 25-year PPA for 1.95 gigawatts of solar and 3.9 gigawatt hours of battery capacity. So the Energy Valley project, as you will see on this page, includes 2 stand-alone BESS installations and 1 solar and battery hybrid facility. And part of the production from this hybrid facility will be used to provide 24/7 green baseload power. And this is a first of its kind.

The project will generate about 6 terawatt hours when it is in operation, it will provide about 2.4 million tonnes of CO2 reductions, and it will save Egypt $150 million on an annual basis in saved fuel costs related to the alternative, which is running their thermal power plants, $150 million on an annual basis. And with the signing of this agreement, we are cementing our position in Egypt as one of the leading players in renewable energy in the country, and we have a very strong team on the ground, which is driving this.

And in total, we now have 5 large growth projects in Egypt across different technologies, solar, wind, batteries and green hydrogen. These projects, they will generate substantial D&C revenues over the next few years as we move them through construction. And on a longer-term basis, obviously, they will also generate predictable revenues in the Power Production segment related to the 25-year PPAs that we have for these projects.

And finally, also this portfolio will contribute to reduction of 5 million tonnes of CO2 emissions. And just for reference, this is more than 10% of Norway's CO2 emissions on an annual basis, more than 10%. So we now focus on finalizing construction of Obelisk and securing partners and financing for this portfolio with the aim to move this portfolio into construction by the end of this year.

So with that, Hans Jakob, I will hand it over to you to take us through the financials.

Thank you, Terje. Is the Microphone okay? Yes. So it's been said before, but we are pleased to present strong results across the group, high D&C activity and a good quarter in the Philippines. I'll walk you through the group financials and the performance of our operating segments. And I will also comment on capital structure and further improvements.

Starting at group level performance. The last 3 years has been a transition period with increased capital recycling and accelerated growth. The full year consolidated revenues was NOK 5.2 billion and EBITDA NOK 4 billion. Our proportionate revenues was NOK 11 billion and EBITDA NOK 4.6 billion, both positively impacted by the D&C segment.

Looking at the quarter on group level, the all-time high D&C activities driving proportionate revenue growth, positively impacting our group financials. Consolidated revenues was NOK 1 billion compared to NOK 1.1 billion in the same quarter last year. EBITDA reached NOK 697 million compared to NOK 816 million year-on-year. The reduction is mainly driven by divestments, which has been instrumental to our long-term strategy of funding growth and reducing debt. This will result in additional revenues from new projects and lower interest expenses and reduced debt.

Our proportionate revenues was NOK 3.4 billion compared to NOK 2.7 billion in the same quarter last year. And the proportionate EBITDA was NOK 1 billion compared to NOK 1.4 billion year-on-year.

Now let me take you through the segments. Starting with Power Production, which delivered revenues close to NOK 1.1 billion compared to NOK 1.6 billion in the same quarter last year. The reduction is mainly explained by the divestment gains of NOK 380 million booked in the fourth quarter last year. EBITDA was NOK 842 million. And on a 12-month rolling basis, you can see stable development adjusting for sales gains as we are managing to offset the EBITDA from divested assets with new projects. The last 12 months, we have delivered NOK 5.2 billion in revenues and NOK 4.3 billion in EBITDA. Overall, we are very pleased with the value generated from our operating assets.

In our Development & Construction segment, activity levels continue to increase. Proportionate revenues more than doubled to NOK 2.3 billion and EBITDA was NOK 251 million, significantly up from the NOK 51 million in the same quarter last year. The trend from the last 12 months confirms the long-term strength and scalability of our D&C business, underlying strong growth.

D&C revenues in the last 12 months have reached NOK 5.8 billion with a steady increase over the last quarter, 5 quarters in a row. The rolling EBITDA ended at NOK 462 million, with contribution from high-margin projects and disciplined cost control. The increasing trend reflects higher activity levels across several geographies with Obelisk in Egypt and Mogobe in South Africa being in the forefront in this quarter.

With a strong backlog, including 8 projects in 5 countries expected to start construction in the first half of this year, we expect D&C to remain a key engine on our continued profitable growth. At the end of the quarter, we had available liquidity of NOK 5.6 billion.

Let me explain some of the main movements. We received NOK 631 million in distributions from power plants, had positive working capital movements of NOK 596 million, mainly related to milestone payments for Obelisk. We invested net NOK 220 million in growth projects and paid NOK 130 million of interest and reduced our corporate debt by NOK 73 million. The EBITDA from the D&C covered investments in the quarter, which is a confirmation of our robust business model and the RCF is currently undrawn.

We continue to strengthen our capital structure. Net corporate debt was reduced to NOK 3.4 billion, down from NOK 5.6 billion in the second and NOK 4.3 billion in the third quarter. The reduction was mainly driven by the change in cash of NOK 900 million. We also repaid the outstanding term loan with the proceeds from the NOK 1 billion bond.

On project level, net debt increased by NOK 800 million to NOK 16.7 billion, and the project debt in operation increased by NOK 2.3 billion as Grootfontein in South Africa and Mmadinare project in Botswana, debt moved to operation after COD and the net debt for projects under construction was reduced by NOK 1.4 billion.

And now the outlook for the year. So commenting on the 2026 outlook, I will start with the full year estimate of Power Production between 5.2 and 5.6 terawatt hours. Our estimated full year EBITDA is in the range of NOK 3.8 billion to NOK 4.1 billion.

And let me explain some of the main items affecting the guidance compared to the NOK 4.3 billion we delivered in the full year last year. Last year, we reported NOK 500 million in divestment gains and operational EBITDA related to Uganda, Vietnam, which we sold during the year, we had NOK 200 million of retroactive payments for tariff adjustments in the Philippines and Pakistan.

In this year, we expect reduced EBITDA from Ukraine due to the repair of one of our plants and lower payment levels for the remainder of the portfolio in the country. Lower EBITDA from the Philippines and Laos due to the normal hydrology expected compared to the high levels we saw in 2025. These effects will be partly offset by contributions from new projects that are starting operations during the year and other operational improvements.

For the first quarter, we expect that total Power Production between 950 and 1,050 gigawatt hours. EBITDA in the Philippines of NOK 180 million to NOK 240 million based on the normal hydrology and strong contributions from ancillary services.

In our D&C segment, we have NOK 1.8 billion remaining contract value and a gross margin estimate of 10% to 12% on average across the portfolio of projects under construction. For corporate, we expect a full year EBITDA of NOK 125 million to NOK 135 million negative. And these estimates reflects a strong base of operating assets, high construction activity and healthy cost control.

And by that, I invite you back, Terje, to take us through the summary.

Thank you, Hans Jakob. So to sum up, 2025 was a very good year for Scatec. We've had good financial performance, high construction activity during the year. We have significantly increased our pipeline and backlog during the year, and we have also strengthened the balance sheet. I'd like to think that 2025 was a transformative year for Scatec.

We also launched our new targets and our strategic priorities during our Q3 presentation. And in 2026, in line with this, we will focus on strong operational performance, execution of our significant growth portfolio, divestment of noncore assets and also take further steps in terms of deleveraging our corporate balance sheet. I think it's going to be a very exciting and a very active and hectic year.

Thank you very much. And now we will move to questions.

Thank you, Terje and Hans Jakob. Over to the Q&A. We will as usual, start with the audience in the room, and then we will take some online questions. So if you want to ask a question, just raise your hand.

[ Andreas Obst ], SEB. In your guidance for 2026 on Power Production, you provided some soft comments about the changes in Ukraine, but could you be more explicit on how much the contribution in Ukraine is expected to be compared with 2025 levels, some rough indication?

Yes. I think in one of Terje's graphs, he showed the impact in the fourth quarter last year of NOK 67 million. I think it's also in the fact sheet. Looking at the outlook as Terje said, the team is working incredibly hard to reinstall the capacity and is anticipated to take until summer. And we haven't provided a figure, but ballpark around NOK 100 million.

Okay. So -- but you also made a comment about which I've interpreted as somewhat lower payments from you...

Lower payment levels, that Terje is very much aware of. And as the rest of us, we have basically had very higher-than-expected payment levels last year. So starting the year with a more cautious approach to more normal as expected payment levels is a fair assumption.

So if I just to summarize, the base line should be somewhat lower and roughly NOK 100 million below the baseline for the first half.

Yes.

Okay. I have another question as well, if I may. In the Development & Construction segment, I appreciate that you're progressing projects and are trying to sustain activity also in the first half, but there are some financial closures, which needs to be in place for that to happen. How should we think about the first half in D&C upon completion of the projects currently under construction, the NOK 1.8 billion?

Your question is what is going to come potentially in addition to...

Yes, or how quickly, is that a second half event? Or are you still comfortable with the commencement of construction, as you indicated in the past, during the first half of...

Yes. I mean we're typically not commenting on specific dates or exactly sort of when the projects in our backlog are going to come into financial close and start of construction. But we see that sort of across the backlog that we currently have. There are also some projects that we anticipate will come into construction -- reach financial close and coming into construction in the first half of the year.

Andreas Nygard, Nordea. You have huge projects now going on in Egypt. Should we assume that you can continue to originate to 2 to 3 gigawatts of projects annually in Egypt?

I think now -- I mean, as we went through here, we now have 5 significant projects in Egypt that we're going to focus on securing financing, bringing in investors, bringing to financial close and start construction during this year. And I think that's going to be a main priority for the year. There's still significant more opportunities in Egypt related to renewable energy. Renewable energy makes sense in Egypt. It's basically saving costs related to the alternative sources of power generation. So -- and Egypt is trying to accelerate their program for reaching their targets when it comes to renewable energy in the power mix. They had certain targets. I think it's 42% by 2035. They took it back to 2030, and now they're trying to reach it even earlier. So in that context and based on our position in Egypt, we see more opportunities in Egypt.

Okay. That's very clear and very nice to hear. But this scale of projects, could you find it outside of Egypt? Or is Egypt quite special right now in terms of the scale of the projects? Could you see 2 gigawatt projects in South Africa, for instance?

Yes. I do think you could also see projects at that scale also in South Africa. But obviously, it also depends a bit on how the regulations are developing. But I think as the power sector also in South Africa will continue to be deregulated, we will also see more opportunities to do corporate PPAs and to build out large portfolio of projects that can basically sell energy to more corporate offtakers. So I think that's a development that we will see. And then we will obviously look for developing large clusters of projects also in South Africa. So there is also potential for larger projects in South Africa.

So in summary, the activity level you're expecting in '26 and '27, that run rate could likely just continue in '28, '29 and for eternity?

Let me answer your question like this. I continue -- or we continue to see that renewable energy becomes more and more competitive in the markets where we operate. With batteries, it becomes more flexible. It can provide baseload green power. And in many of the markets where we operate, we are -- the countries are, in principle, saving money, reducing alternative cost of power generation from implementing renewables. So I don't see a reason why the current pace in the industry is not going to continue. And I think based on everything that we are currently doing and the track record, capabilities of the organization that we have, I think that we are in a good position to capture part of that growth.

We have a couple of questions from our online listeners as well. We can start with Jørgen Lande from Danske Bank. In terms of recent movements in input costs like silver and copper, can you comment on how this potentially has impacted the progress of reaching FID?

I think there's a couple of things happening in the industry. Some component prices are going up. The VAT rebate in China has been removed or is being removed over time related to panels and batteries. On the other side, we also see that other components that we are using, we are able to achieve savings. And the things that are happening in this industry is obviously not -- it doesn't come as a surprise to us. So we don't see that any of these things that are happening in the industry will have any significant impact on where we will be able to reach FID and take financial close and start construction of the projects that we currently have in the backlog.

We will obviously continue to be very disciplined in terms of our hurdle rates, in terms of making sure that all the projects that we are doing are value creating for us and our shareholders. But based on what we are currently seeing, we see that sort of the changes in the industry is manageable and not also surprising.

Thank you. One question from Helene Brondbo from DNB Carnegie. Can you shed some more light on the status of your ongoing asset rotation program?

Yes. That's the one we are not sharing a lot of detail on announcing transactions. What we have said is, of course, that we have clear ambitious targets, another NOK 3.4 billion proceeds to 2030. This is within a time frame, which should be manageable and its main focus on the noncore. It's also reaching certain ownership stakes deliberately on project carefully timed. So we have discussions ongoing and we are in terms of our long-term plan according to plan.

Thank you. Helene also asked about the input costs. I think we have covered that. Another one from Helene, to what extent can we expect the solid D&C gross margin in Q4 to be repeated?

Yes. Here, I mean, we have commented on that in our outlook, and we're saying that with regards to the NOK 1.8 billion that we have remaining in construction revenues or contracts, we are expecting and we are indicating that we will continue to reach in the range of 10% to 12% gross margin of those contracts.

Thank you. Another one from Jørgen Lande, Danske Bank. You guide 2026 Power Production to a midpoint of 5.4 terawatt hours, which is higher than the midpoint of consensus while EBITDA implies a very softer margin. Can you comment on how you think about our Power Production EBITDA in 2026?

Yes. So I understand -- I think I understand at least where Jørgen is coming from. So is there a misalignment on the EBITDA side, and it has to do with the composition of the contribution. So I think we have to stick to the guiding that we have provided today and NOK 3.8 billion to NOK 4.1 billion is explained also in contrast to last year, the one-offs, any divestments is, of course, a potential deviation but also the impact on the pace of the new projects coming in. And I think it feels at least a bit special for us taking the development into account Kenhardt and then doubling to Obelisk and then we have Energy Valley. But we're not pre-announcing anything. We just signed a PPA, but we are working very hard to mature this project, and that is, of course, a significant potential contribution. How this is forecasted? I think we have to stick to professional secrets.

Thank you. We have some questions from Anis Zgaya from ODDO BHF, one on Ukraine. I think we covered that one. Another one on the Philippines, you show a sustained contribution from ancillary services and a favorable water fee settlement in 2025. How should we think about AS, ancillary services pricing and volumes in 2026 versus 2025? And what's your assumption for hydrology normalization embedded in the guidance?

I think when it comes to the ancillary services market, there are 2 elements of the ancillary services revenues that we are currently generating. It's partly related to a contract that was secured a couple of years ago, where we have very predictable revenues. And that contract is representing maybe around 50% of the volumes that we are typically seeing in that segment. And in general, when it comes to the pricing, on a short medium-term basis, I mean, it's very difficult to provide input and outlook in terms of prices, but we don't see a reason on a short medium-term basis that the prices in the ancillary services market is going to change.

Yes. And on normal hydrology, it's just that when you use these data for up to 10-year period, you see variations. And last year, I think we agreed that it was above normal hydrology. And it's a bit hard to start the year without normal hydrology as an assumption. So that's where we start off, just being transparent about the relative change.

And obviously, the interesting thing when it comes to the Philippines now is that we have 2 new projects, 2 new battery storage projects that are in construction and that we are anticipating to reach financial COD in the first half of this year, and that is increasing our capacity related to battery storage from 24 megawatts to 80 megawatts in the country, so a tripling of capacity that comes into operation first half this year that enables us to increase our participation in the ancillary services market.

And then on top of that, we are also intending to move more projects. We have more projects in backlog also related to battery storage, but we will also aim to move into financial close and start of construction also relatively soon, and that will further then increase our capacity on the ancillary services market and increasing our flexibility in the Philippines and increasing our ability to tap into several revenue streams, as I talked about in the commentary.

I just flip to the slide that you showed how significant ancillary services has been sustained over several quarters. So with the ramp-up of battery capacity, it's even more robustified.

One follow-up on your Ukraine. Any insurance recoveries or compensation mechanisms you can detail?

No, currently in the current situation in Ukraine, and we have to remember that the war is soon entering its fifth year. It's not really possible to get insurance, which is going to cover these kinds of events in Ukraine.

Okay. Quite a lot of questions today. Just I think, 2 more. Lars Christensen, Fearnley Securities. Congratulations on the strong results. For the Energy Valley project in Egypt, should we expect any asset rotation to help fund the investment?

As we said, we are continuing to work on our divestment program, and we will continue to work on optimizing our portfolio over time and have a very active perspective on our portfolio. And then we also, in previous presentations, discussed the fact that we will, in certain projects, also go down in ownership stakes through a layered structure, where we are still able to maintain control over the project, but to take down our direct equity investment into the project and through that, manage also the capital investments over time.

Okay. I think we'll take just one last question. Do you see any problems of the power grid in any of your countries you have -- where you have large projects? And how do you solve these problems?

It is clear that sort of with the increased penetration of renewables, especially intermittent renewables, there are situations, I think in all grids, in all countries, where, you will have temporary challenges with the grid that will either have to be managed through strengthening the grid over time or also with the addition of storage capacity and batteries. And there, I would like to draw the attention to Energy Valley projects. It's 3 installations, 2 pure battery installations at 2 different locations and 1 hybrid facility. And obviously, those stand-alone battery installations, they are put where they are in order to help balance the grid and mitigate those types of concerns in those situations.

Similarly, same thing is happening in South Africa, where we are now building one stand-alone battery project and where we have another one in our backlog. And these batteries are obviously also put into places where they help balance the grid and mitigate the challenges that will, in certain places, come into the grid. So this is an important part of our business going forward. We have to be very -- we have to be on top of the grid situation in the markets where we operate and make sure that we focus on the areas where there is grid capacity and where we will be able to implement new renewable energy projects and deliver the energy onto the grid.

Thank you, Terje and Hans Jakob. One more from Andreas, SEB?

Just a final question on asset rotation, the NOK 3.4 billion when you refer to asset rotation, that relates to projects already in operation as of today, right?

That's correct.

One more from Andreas, Nordea.

So just the last one on your investment target, NOK 1 billion of equity annually. The Energy Valley project, I guess, you will structure it perhaps the same way you're doing Obelisk, aiming for an equity bridge perhaps. The way you're seeing your backlog now, are you actually using the full of your NOK 1 billion equity injection capacity the way you're looking to structure that backlog?

I think Terje will fight to answer that question, do you want to go? Okay. Under construction and in backlog, there is equity around NOK 3 billion, and that is excluding Energy Valley. So Energy Valley is sizable as you could imagine. And we will come back to more granularity on the project as it is progressing, but we are well underway to reach our target and the guiding from the strategy update. That's basically directionally what I would like to say. But under construction and backlog is around NOK 3 billion equity.

And will that be cash?

We haven't provided super detailed analysis of this today, and I think we will come back to it. But I read your question, Andreas, is this in line with what you said you would inject of equity. And I think we are fairly aligned what we have on the plate as is.

Okay. With that, I think we say thank you to everyone and end today's presentation. Thank you.

Thank you very much.

Good morning, everyone, and welcome to our third quarter presentation. Today, we are presenting another quarter with strong financials and also good progress on our strategic priorities. We will also provide an update on our strategy and targets towards 2030. And then reflecting on our last 12 months, we have made significant progress on our strategic priorities, both in terms of growing our renewables portfolio and also in terms of strengthening our balance sheet.

And we expect this momentum to continue and at an even higher pace than what we have seen over the last 12 months. So let me start with the highlights of the quarter, and then Hans Jakob will take you through the financials. And then I will come up -- come back with an update on our strategy and our targets towards 2030. So then in terms of the highlights of the quarter, our total proportionate revenues increased by 22% to nearly NOK 3 billion in the quarter. And our EBITDA was NOK 1.1 billion, representing increased activity levels and especially in our D&C segment, where we have had very good progress.

Our projects under construction are progressing well with revenues of NOK 1.8 billion in the D&C segment and a very strong margin of 11.4%. And I'm also very pleased with the development of the backlog that it is now at an all-time high of 3.4 gigawatts after we have included a new project in Colombia, 130 megawatts after we have signed a PPA there and also included 80 megawatts of battery projects in the Philippines after these projects are progressing and getting closer to construction.

And here, I would also like to highlight the progress that we are making on Release, our platform for leasing out solar and BESS equipment in Africa. Here, we have started installing a new solar and battery system and lease contract with Eneo in Cameroon, and we have also signed 2 new lease contracts in Liberia and Sierra Leone. Then we also continue to strengthen our balance sheet, and we repaid NOK 953 million of corporate debt during the quarter. With this, our net interest-bearing debt on corporate level is now down to NOK 4.3 billion.

And finally, based on the strong progress on pipeline growth and corporate debt reductions, we are increasing our ambitions for our self-funded growth plan going forward, and we will talk more about this towards the end of the presentation. So now let me talk about power production. We generated 1,202 gigawatt hours in the quarter, and this is an increase of 7% adjusting for the divestments during the year.

This is driven by good hydrology in the Philippines and also a new project coming into operation during the year in Botswana. Revenues came in at NOK 1.2 billion, and this also represents a small increase from the same quarter last year, adjusted for divested assets, and this is also driven by the increase in generation. So now let's talk a bit also in terms of more details on the Philippines. The Philippines delivered a strong quarter, both in terms of power generation, in terms of ancillary services and also in terms of financial contribution. Power production increased by 16% from last year to 354 gigawatt hours, and this is again based on strong hydrology.

Contract volumes were also significantly up to about 150 gigawatt hours. This is based on selling replacement power to other energy companies on shorter-term contracts. And these contracts are limited to the second half where we have very good hydrology and we are long on energy generation. Prices in the Philippines have been down in the quarter, but based on our flexible generation portfolio and trading activities, we've been able to secure above-average market prices for the spot sales that we're doing in the Philippines.

Revenues reached NOK 385 million in the quarter, and this is compared to NOK 432 million in the same quarter last year when we had a catch-up effect of NOK 60 million. And underlying EBITDA increased to NOK 10 million by NOK 10 million to NOK 332 million, also reflecting good cost control in our venture in the Philippines. Then in terms of construction. We currently have close to 2 gigawatts of solar and battery storage projects under construction in 6 different countries.

And since last reporting, we have had very good progress across the portfolio, and we have recorded D&C revenues in the range of NOK 1.8 billion and also with a very strong gross margin of 11.4%. The EBITDA for the D&C segment came in at NOK 135 million. In South Africa, Grootfontein is undergoing commissioning and testing as we speak and will come into operation shortly. In Tunisia, construction is progressing well and also for these projects, we expect them to reach operation by the end of this year. We expect COD in the first half of 2026 for our projects in Brazil, in Botswana and also in the Philippines.

While when it comes to Mogobe, our first pure battery project in South Africa, we expect this to come into operation in the second half of next year. And then finally, the Obelisk project in Egypt. This one is being built in 2 phases with these 2 different phases coming into operation in the first half and the second half of next year. I'm incredibly pleased with the progress that we are currently doing on construction across all these different projects in all of these different countries and very, very proud of the teams and seeing what the teams are able to do related to the construction progress.

At the end of the quarter, we still have NOK 4.1 billion of remaining contract value, and we continue to expect to be able to realize 10% to 12% gross margin related to these projects. So let me then zoom out a bit and comment on our total growth portfolio. And growth continues to be supported by our integrated business model, limiting our net equity investments into our projects. This is enabling us to scale through a self-funded approach without overstretching our balance sheet.

On the left-hand side here, you will see our project portfolio in construction with estimated EPC revenues in total for the whole portfolio of about NOK 9 billion and with NOK 4.1 billion remaining contract value. Below, you will see our backlog, which includes awarded projects with secured offtake agreements. This now represents close to NOK 17 billion in additional EPC revenues for our D&C segment. We target construction start for 2 of these projects in 2026, while the rest of the project is expected to come into construction through 2026.

Some projects have moved out in time, as you will probably recognize, but none of the projects have fallen out of the backlog, and we still aim to bring all of these projects into construction. As we have emphasized before, revenue recognition resembles an S-curve for our construction period for the projects. And we aim to have positive working capital through how we are structuring our projects through the construction time lines for the projects. As you understand, we have a transformative period ahead of us. We have a strong portfolio of secured projects, which will enable us to more than double our operating capacity over the next 2 to 3 years to more than 9 gigawatts. Now I will hand over to Hans Jakob to take you through the financials.

Thank you, Terje, and I'm pleased to say that we delivered strong results across the group. We have higher production and high D&C activity, and we had a very good quarter in the Philippines. I'll walk you through the group financials and the performance of our operating segments and also cover the improvements in our capital structure. Starting with group level performance. We delivered strong results in the quarter. Consolidated revenues was NOK 1.1 billion compared to NOK 3 billion last year, where we had sales gains from divestments in South Africa. The EBITDA reached NOK 785 million. The results are impacted by an impairment in Mendubim of NOK 130 million due to new assessment of future curtailment levels and power prices.

To the right, you see the proportionate financials. Revenues increased by 22% to NOK 2.95 billion, while EBITDA ended at NOK 1.1 billion. Adjusted for sales gains, we are in line with the same quarter last year. Now let me take you through the segments. Starting with Power Production, which delivered another solid quarter. Revenues reached close to NOK 1.2 billion compared to NOK 1.8 billion in the same quarter last year, where we also had sales gains and a catch-up payment in the Philippines. EBITDA was NOK 955 million. On a 12-month rolling basis, you can see a positive trend, which shows both underlying growth and strong contribution from divestments.

The slight downtick in the quarter are partly explained by the strong Q3 last year due to the divestments in South Africa. The last 12 months, we have delivered more than NOK 5.7 billion in revenues and NOK 4.8 billion in EBITDA. Overall, we are very pleased with the generation from our operating assets. In our D&C segment, activity levels continue to increase. Proportionate revenues were NOK 1.76 billion and the EBITDA of NOK 135 million, more than doubling quarter-on-quarter.

The trend of the last 12 months confirm the long-term strength and scalability of our D&C business and gives a clear picture of the strong momentum that we are building. D&C revenues in the last 12 months have reached NOK 4.5 billion with a steady increase over the last 5 quarters, and we aim to continue. Rolling EBITDA ended at NOK 261 million with strong contributions from high-margin projects and disciplined cost control. The increasing trend reflects higher activity levels across several geographies with Obelisk in Egypt in the forefront.

With a strong backlog moving into construction, we expect D&C to remain a key engine going forward with continued profitable growth. At the end of the quarter, we had available liquidity of NOK 4.7 billion. Let me explain some of the main movements. We received NOK 424 million in distributions from power plants, including proceeds from refinancing in the Philippines, had positive working capital movements of NOK 1.4 billion, mainly related to milestone payments for Obelisk, invested NOK 414 million net in growth projects, paid NOK 139 million in interest and NOK 943 million in debt repayments. The RCF is currently undrawn. We continue to strengthen our capital structure. The net corporate debt was reduced to NOK 4.3 billion from NOK 5.6 billion in the second quarter.

The reduction was mainly driven by the change in cash and close to NOK 1 billion of corporate debt repayments. The reduction was mainly driven by the change in cash, as I said, and the NOK 1 billion of corporate debt reductions. So this is a very positive trend, where we on project level, have increased the net debt from -- by NOK 2.3 billion to NOK 15.9 billion as we continue to grow. The debt for projects under construction had a net increase of NOK 2.5 billion, mainly related to Obelisk. And finally, I'll take you through the outlook before I give the floor back to Terje.

So the outlook for 2025 with a full year perspective, where we estimate the power production between 4,100 and 4,200 gigawatt hours. Our estimated full year EBITDA midpoint is increased by NOK 50 million to NOK 435 billion. This is driven by an estimated strong performance in the Philippines in the fourth quarter. For the fourth quarter, we expect the total power production between 1,000 and 1,100 gigawatt hours and the EBITDA in the Philippines of NOK 280 million to NOK 380 million based on normal hydrology, strong contributions from ancillary services.

And in the D&C segment, we have remaining contract value of NOK 4.1 billion and a gross margin estimate of 10% to 12% on average across the portfolio for projects under construction. For corporate, we expect a full year EBITDA of NOK 115 million to NOK 125 million negative, which is in line with the previous estimate. These estimates reflect a strong base for operating assets, high construction activity and a healthy cost control. And by that, Terje, please take us through the strategy update.

Thank you, Hans Jakob. So it has become a bit of a tradition during our third quarter presentation to also give a strategy update. And this time, we will increase also the time perspective until 2030. And to be clear, we are increasing our growth rate. We continue to be self-funded, and we will continue to take down the corporate debt levels. These are the main pillars of also how we are going to drive our strategy going forward. And we are on a steady course to provide profitable growth from an all-time high construction program, while our financial flexibility will continue to improve going forward.

So let me start by taking stock of our progress on the strategy communicated last year. We have made good progress on all key priorities, and I'm pleased to say that we are ahead of plan. Regarding growth, we have already secured projects in construction and backlog that will take us beyond the target of NOK 750 million in equity investments annually. On divestments, we have secured NOK 2.6 billion in proceeds, and we have allocated more than 75% of these proceeds to bring down our debt on corporate level. And our corporate interest-bearing debt is now at NOK 6.7 billion, which is a significant reduction of the NOK 9.2 billion that we had last year. So all in all, we are on track to reach our 2027 targets communicated last year and well positioned to capture future attractive growth going forward.

And then in terms of the industry, we continue to see a very positive development when it comes to the renewables industry going forward, and this is really supporting our growth ambitions. Solar panel, wind turbines and battery prices continue to come down, and they are now again at all-time low levels. And especially the reduction on battery prices is really a game changer for the industry and a game changer in the markets where we are operating. This increases the usability and significantly also increases the market size and opportunity space for us as a renewable energy players. And this is a development I think it would have been difficult to foresee only a few years ago in terms of how rapidly this is developing.

And we can now deliver dispatchable renewables at competitive prices in most of the markets where we are operating. And further, with batteries, in addition, we can also provide ancillary services, frequency regulation and also load shifting to the grid. So it's also increasing the services that we can provide in these markets. So this makes renewables the most attractive source of energy in the markets where we operate and not only as intermittent power, but also as dispatchable and baseload power. So this development will continue to fuel the growth of renewables going forward in our markets. Bloomberg estimates that investments in renewables will exceed $100 trillion annually in relevant markets in the years to come.

And that will exceed -- and this means that it will exceed $500 trillion in the period from now until 2030 in our emerging markets. And this assumes a deployment of 2,500 gigawatts of renewables in this period. So this is massive in terms of deployment. And Scatec, we have a strong track record, and we are well positioned to compete in this space. And the key for us going forward is really to identify the good opportunities and be able to identify opportunities where we are able to capture attractive value.

So in summary, our strategic progress over the last years, coupled with the development of the renewables industry represents a strong basis for increasing our growth ambitions going forward. And then based on this, we, as I have already said, increased our growth targets towards 2030, while we will continue to deleverage. We target to invest on average at least NOK 1 billion annually in equity in new projects in this period, and we will continue to focus on selected markets where we see renewables fundamentally making sense and where we see that we have a strong position and we will also continue to build on our multi-technology skills where we're able to deploy hybrid projects.

I will say that we have good visibility on short-term growth, and we have the ability and we will continue to stay disciplined relative to our investment hurdles. We will also continue to deleverage our corporate balance sheet, and we aim to bring down our corporate debt to about NOK 4 billion by 2030. And this will obviously increase our interest expenses and the burden on our balance sheet -- from our balance sheet significantly in this period. Finally, we stay committed to optimize our portfolio to become even more capital efficient, and we target to realize another NOK 3.4 billion in divestment proceeds in the period, and we will continue to optimize investment structures so that we can also capture value in an efficient way and use our capital in a very efficient way.

So then in terms of growth, our targets are backed by, as I've said, very good short-term visibility and a strong pipeline. We currently have 2 gigawatts under construction. And in addition, we have a backlog of 3.4 gigawatts after we have added a project in Colombia and also battery projects in the Philippines, as I mentioned previously. So these backlog projects are expected to start construction over the next year. And altogether with these projects, we will be able to more than double our capacity in operation to more than 9 gigawatts.

Further, we have a large pipeline of 7.6 gigawatts of maturing quality projects. And in addition, we also have a significant portfolio of early stage and greenfield opportunities that we are developing over time and that will also move into the pipeline as these ones are maturing. And we have not talked so much recently about the opportunities that we are working on because our main focus has been on conversion, conversion from pipeline to backlog and from backlog to construction. But we have more than 10 gigawatts of also opportunity projects that have not yet been included in pipeline that we continue to work on.

And to be clear, we will continue to focus on the markets where renewables fundamentally are competitive and where we see good opportunities to build scale over time. And these markets are characterized by attractive solar and wind resources, obviously, a growing economy with sizable and growing energy demand and clear energy targets with stable and supportive regulatory environments for renewables. And our main regions are highlighted here on the map, and these are markets with some of the world's best solar irradiation and wind resources. And we will continue focusing the main portion of our growth capital on existing markets, existing countries where we do already have strong positions.

However, we also see value in having a diversified portfolio across different markets with strong potential for renewables, and we will invest in solid projects where the fundamentals are strong and where we see outlook for long-term growth and building scale over time. So let me then address some of these markets and also shed some light on the opportunities to grow beyond what we have currently communicated as pipeline.

So Egypt provides favorable conditions with its strategy to promote industrial decarbonization, energy security and to achieve 42% renewable energy in the generation mix by 2030. And here, we continue to have discussions on new projects to support the government in reaching these targets. South Africa is offering attractive public tender rounds, which we have been successful in for many years. And in addition, we do see a growing market for private offtake, and we are positioning ourselves here in the C&I segment through our Lyra platform, where we are developing this together with our partners, Stanlib and Standard Bank.

And in South Africa, we are developing a broad greenfield portfolio of new projects that are not yet included in our pipeline to make sure that we are well positioned for opportunities also in the future. The Philippines has a target of 35% electricity generation from renewable energy by 2030 and 50% by 2040. And today, they are only at 22%. Together with our partner, Aboitiz, we develop a multi-technology pipeline to also address this market opportunity going forward. Then let me also mention Tunisia and Romania. These are examples of relatively new growth countries for us with a very large potential.

Here, we are more early stage. We are building our development teams, and we are developing pipelines for capturing opportunities here on a long-term perspective. And all of these are examples. Our pipeline includes only projects that are at least 50% likely to reach financial close and move into construction. But obviously, and to illustrate that here, we do have a significant volume of opportunities, which is coming behind this pipeline and will move into pipeline as they mature.

Then let me talk a bit about also our multi-technology approach. As I've said, we see that battery technology and the development within batteries is really a game changer for the industry, and Scatec is at the forefront of the development here. So let me share some examples. First, in South Africa, we have Kenhardt, soon to be 2 years in operation, and this project is already showcasing how renewables can provide dispatchable and baseload power in a competitive manner with other technologies.

Second, also in South Africa, we have 2 battery storage projects that is enabling Eskom to unlock grid capacity at constrained points in the grid. Both were awarded in tenders and the first one, Mogobe is already in construction. Third, we have the Philippines, where we have battery storage projects providing ancillary services to enhance grid stability. Here, we have 24 megawatts already in operation. We have 56 megawatts in construction, and we have 80 megawatts that we have now moved into backlog, and we are also developing more projects together with Aboitiz supporting this going forward.

And finally, we also have Egypt where we are constructing the hybrid Obelisk and Obelisk is building on the learnings and experience that we gained in Kenhardt. And here, we are adding battery capacity to enable delivering more energy during the peak hours in the evening so that it more fits with the needs of the grid in Egypt. So these are examples, and it's just the beginning as we expect this development and our track record to unlock significant new opportunities going forward.

So let me then also, before I move on, emphasize that we will continue even in light of all of this growth to stay disciplined with regards to our investment hurdles as we pursue these new projects going forward. We have strict investment criteria, and we will only move forward with projects that are meeting these hurdles and our guardrails. Our equity return hurdle continues to be 1.2x cost of equity for our projects. And our cost of equity is adjusted for the market and the country that we are in and is specific for the projects that we realize, and we are adjusting it amongst other for factors like country risk, FX risk and also offtaker risk.

And as an indication, the average equity IRR from our power production and services for projects under construction and backlog is in the range of 15%. And obviously, we also do construction for most of our projects. And then we also get a significant uplift from both development fees and construction margins, increasing average equity IRRs to around 30% on a net equity basis. And on top of this, when projects are in operation, we will continue to seek ways of optimizing the value through, for instance, refinancing and also farming down equity in some of these projects.

So then -- we also then move to the second strategic priority. We will continue to deleverage and we target to bring the corporate debt level down to NOK 4 billion by 2030. And we have already made good progress since last year, and we are reducing the debt. We have reduced the debt by about NOK 2.5 billion to NOK 6.7 billion during the year. And already now, we start seeing the results of our efforts to strengthen the capital structure. The run rate of corporate interest expenses has significantly reduced, and this will reduce the burden on our corporate -- of the corporate debt on our free cash flows going forward, and this is important for us.

And further, the credit margin on our bonds, they have also been vastly reduced over the last 2 years. We issued our last bond at a credit margin of 350 basis points, and this one is now trading at an implied margin close to 250 basis points. And this is -- and here, we have seen a significant improvement of our credit margins and debt costs only over the last couple of years. So strengthening the balance sheet and improving our financial flexibility will continue to remain a key priority for us going forward.

And then finally, in terms of financial flexibility, we target NOK 3.4 billion in additional divestments by 2030. We have shown good progress already in this area. So this is on top of the NOK 2.6 billion that we have already realized. And thus, in the period from our strategy update last year and to 2030, we target to realize in total in the range of NOK 6 billion in divestment proceeds. So we stay focused on capital recycling to fund further growth and also debt repayments.

So let me then summarize. Q3 was a very strong quarter for us. We had good financial results, but most importantly, we have seen very good progress on our growth activities, both in terms of construction progress, but also in terms of increasing our backlog. And finally, during the quarter, obviously, we have also seen very good progress on reducing the corporate debt levels. Then we are also seeing a continued very positive development of the industry. Component prices are at all-time low, and we continue to see new opportunities being emerged and delivered in terms of the very good ability of renewables now to compete with all other sources of energy generation.

Renewables in our markets is now the most cost-efficient source of energy, not only on an intermittent basis, but also as dispatchable or baseload power. And then based on these 2 very positive developments, we're very comfortable with increasing our growth rates. We are upping our growth rate to have a target to invest NOK 1 billion in new equity annually in the period until 2030 at the same time as we will bring down debt and continue to grow on a self-funded basis. Thank you very much for your attention. And I think we will now open up for Q&A.

Thank you, Terje. Thank you, Hans Jakob. Yes, we'll then open up for Q&A. We will just start with our audience here and then move on to the ones that are listening online. [Operator Instructions]. Starting with Daniel from ABG.

Daniel from ABG. So one question on the backlog and the new growth targets. So based on the backlog you now have, how much of the new growth targets in the period towards 2030 would you say is already covered by that from your view? So that is my first question.

Well, I mean we are talking about NOK 1 billion in equity investments annually. And obviously, we are indicating a growth target and the backlog is represented in terms of gigawatts and megawatts, not in terms of money. But I do believe that we have a significant portion of that growth target already in our backlog. I'm not going to come out with a precise percentage. But as I said towards the end there, we are quite comfortable with the backlog that we are having, and we believe that we are now in a position where we can really be disciplined in terms of the hurdle rates and making sure that we only do investments that are meeting our hurdle rates.

Okay. Good. Then I have a second question. I think you said last quarter that you are in advanced talks on potential deals. So I don't know if you have any new comments on that this quarter versus last quarter.

Maybe you can check my outlook and see where I'm traveling, but no -- joke to the side. I think that still holds. As Terje said before, doing 1 to 2 of these per year is time consuming and it's a lengthy process. So we are a bit cautious on coloring more, but advanced talks is fairly accurate.

And maybe a last one on Mendubim. Can you maybe add some color there in terms of lowered assumptions?

Yes. On Mendubim, we have new reports on the markets that we have procured. And in these reports, we see that the expected curtailment levels are going to expand further into the future than what we had seen before. But we now also see that there are very concrete initiatives in Brazil in terms of improving the grid and making sure that the curtailment levels will come down over time. But the impairment is based on seeing that curtailment will last a bit longer than what we had anticipated before based on new external reports.

Okay. Anyone else would like to ask a question? Thomas [indiscernible].

I usually have a lot of questions, but today, everything was pretty clear. So that's good. Could you just touch a bit upon the Philippines, ancillary services, you continue to say that you get a strong contribution there. And you also mentioned that new projects with dispatchable renewable energy will open up opportunities for doing ancillary services also in other markets. Yes. Could you just elaborate a bit on that opportunity?

Yes. I think in the Philippines, you see what is being contributed by ancillary services. And I don't think we'll start dissecting what's coming from batteries and what's coming from the hydropower plants. But clearly, the ancillary services volumes and prices in the Philippines has been very attractive over the last year, also with the opening up of the ancillary service market so that you both have contracted revenues and you have also more they had spot-related revenue.

So it gives a very good platform on the revenue levels in the Philippines. And we do see that this is a market that is going to increase going forward with further additions of renewables, intermittent renewables in the market. So we believe that it's going to be an opportunity that's going to be there for some time that can be captured from also new volumes being brought into the market also from our side. In the other markets, I think we -- in most of the other markets that are more regulated than the Philippines, I think we will see to an increasing degree that the batteries will come as part of a hybrid project, where the project will offer a number of different services to the grid and to the grid operator, not only providing electricity, but also providing regulating power, and that is being part of sort of what you are selling in, in new projects going forward in these markets.

But -- so the situation will obviously be slightly different in regulated markets relative to deregulated markets. And then I think we also see in many of the markets where we are, the emergence of capacity or storage auctions and tenders and that this is becoming more and more an integrated part of how the regulators are thinking about developing the grids going forward, not only strengthening the grid, but also providing storage batteries to manage their regulating power and unlock grid points.

In terms of the expected returns on projects that are combined solar and battery, do you see kind of terms improving as in terms of when you just had solar stand-alone, say, 1.5 years when you started as CEO?

Yes. I'm not going to give you sort of a straight answer on that question. I think we will -- on all our projects, we will continue to make sure that we meet our investment criteria, investment hurdles. Obviously, in markets where you are more exposed to different types of risks, we will seek to get a higher return than in the markets where sort of everything is contracted.

And in terms of -- you booked a lot of contingencies at Kenhardt because, of course, yes, you have those to be released? And you won't comment on contingencies coming, but could you say when the contingencies would come if there are any on the projects that you are now?

Well, I mean, in principle, contingencies will be released as you are comfortable with the risk of schedule and quality and everything on the construction coming down. So I mean, naturally, contingencies are more likely to be released towards the end of the project and then the project has been finished than during the construction of the project. If you talk about EPC-related contingencies, obviously, which I think you are.

More questions? [indiscernible].

I have a couple of questions. Firstly, on the impairment in Brazil, what was the hurdle rate used in the impairment testing?

Well, I don't think we have talked loudly about it. I'd rather rephrase saying based on the external report on long-term assumptions, it was difficult for us to defend the value. So we thought we were more better off long term also doing this impairment now, basically. And I could segue into compensating measures and so on, but your direct question, we're not answering that specifically. But we have done an extensive review of all our assets, and we did an impairment in Mendubim particularly.

Okay. And -- but will we find it in the annual report?

A comment on...

Hurdle rates for impairment testing being a CDU?

I can't recall us going into that level of detail, but Andreas and I can check it off and basically -- and back to you.

Okay. And how much of the asset was impaired? Or what was the gross value of the asset prior to the impairment?

[indiscernible].

25% of the gross assets. Okay. Thank you. And my second question is, it seems to me that you probably had some headwind on currency in the third quarter because of the strengthening of the NOK against a lot of these currencies that you have assets in. Did that have any material impact on the results from power production in the third quarter?

No is the short answer.

Because it's hedged and everything is.

Yes. Nothing significant -- commented on it.

Okay. And my last question is when will we see Scatec do projects only relying on, say, market or spot prices? I appreciate that you might do long-term contracts, but are we there that you will pursue projects, which is basically selling into a well-functioning market without any sort of subsidies and initiate that kind of projects?

Well, I mean, we are already doing it in the Philippines, I mean, with our battery projects in the Philippines. So we are doing it. The -- and this obviously is very much linked to the overall model on how we realize the projects. If you do something which is very much based on merchant or you have shorter-term contracts or you don't have contracts for 100%, then your leverage in the project will go down and you have to carry more of sort of the CapEx through the equity that you inject into the project.

So I mean, it depends also on how we want to realize projects and how we think about being capital efficient in the way we move forward. In the Philippines, we can still get project financing on a merchant basis based on the large portfolio that we already have there. So there, we have a very, very good advantage from that point of view. But I think -- I mean, as we move into other markets where more of the offtake is related to corporate PPAs, maybe some contracts for differences, other type of structures, you will maybe see that a portion of the project might be exposed to more merchants, like, for instance, we already have in Mendubim, where about 60% to 65% of the project is selling on a contract to Alunorte, while the rest is being sold into the market on short to medium-term contracts. So I think it's not sort of -- it's not black or white. We want to see it as a transition in most of the markets where we are.

But you still have a preference for longer-term coverage because of the leverage you will be able to obtain.

Yes. And I think it's incredibly important. I mean things are changing now with the technology of the industry where you can combine and you can provide more baseload, you can provide merit, you can also provide some flexibility based on renewables in hybrid structures. But obviously, we are not going to take on a type of risk that we don't feel that we can manage, right? You will never go in and sell a pure solar project into a merchant market because you know there might be low prices during the day if there's over implementation of solar and then you want to be stuck there having to take low prices. So you need to sort of put yourself and your projects into a position where you control the risk and you have the flexibility you need if you're going to be taking merchant risk.

Thomas had another question.

A quick follow-up on kind of those merchant projects because looking from the outside on the eastern parts of Europe, say, Romania, for instance, if you're allowed to connect the Chinese battery to the grid, it looks like a completely no-brainer. In terms of kind of the payback times you see on average day ahead prices. I mean the spread is multiple, multiple times of what you need to break even. Number one, do you see the possibility of getting those grid connections for stand-alone battery projects in the eastern parts of Europe? And number two, do they accept Chinese equipment, full turnkey projects?

Well, I think on the first one, yes, we do see those opportunities in certain markets in Europe and also certain other markets. Obviously, it's about sort of -- it's about timing. It's about when you can get the grid connection and then you can get the project installed in terms of limitations on Chinese equipment. It is not about Europe itself in terms of there is a limitation or not, but it's more about what financing institutions are you working together with and what will those financing institutions accept to fund in terms of Chinese equipment. But I don't see, in general, a limitation of bringing Chinese equipment into Europe.

Work with Chinese financing institutions on SPD level?

You could, but I think we see -- we probably see other more attractive financing alternatives and working with the Chinese, which is mainly vendor financing, which we don't think is that interesting.

So we should not be surprised if we see stand-alone battery projects in the Eastern parts of Europe?

No, I don't think you should be surprised.

We have a couple of questions from our online listeners as well. This is from Jørgen in Danske Bank. Related to your new unlifted divestment proceeds amount of NOK 3.4 billion by 2030. Can you elaborate on this? Has your scope been expanded? Or does this still align with previous perspectives? And also any changes to sales process?

Well, I mean, our scope has been expanded in the sense that we now look towards 2030. But in terms of what we are considering for divestments, farm-downs and capital recycling, the scope is still the same. And we will continue to look at divestments in markets where we don't see continued attractive growth opportunities. But we will also look at farm-downs, recycling capital in some of our larger markets where we may think it makes sense to recycle the capital and invest into new opportunities. So that still remains the same.

One more question from Jørgen related to Mendubim. I think we partly have covered it, but the question is also, could this also have effect on other projects or other projects in Brazil and then might trigger impairments on those projects.

It's covered in the report, and we specifically say that we have no grounds to speculate. We have done the impairment assessment of all assets, and it's only Mendubim. This is also partly due to contract structures, counterparties and geographical location.

Thank you, Hans Jakob. I actually think we have covered the rest of the questions here. So if there are no further questions, I think we will thank you for listening and end today's presentation. Thank you.

Thank you.