Listed renewable energy developer Tilt Renewables is to return $260 million to shareholders in the midst of the Covid-19 crisis, but says the capital return will not impact its ability to invest in various battery storage investment and other small projects.
Tilt on Wednesday announced the capital return of 55c a share – equivalent to nearly half of its “unrestricted cash” of $535 million, mostly gained from the recent sale of the Snowtown 2 wind project in South Australia. Its pool of unrestricted cash does not include the funding already sourced for its 336MW Dundonnell wind project in Victoria, and the Waipipe wind farm in New Zealand.
CEO Deion Campbell said the decision was made after assessing its pipeline of projects – up to 3000MW over the short, medium and long term – and working out whether the money may be “better utilised” in the hands of its shareholders in the midst of the Covid-19 pandemic.
“This is a great opportunity for (Tilt) to let its 8,100 shareholders benefit directly from the highly successful sale of Snowtown 2 (for more than $1 billion), whilst still leaving plenty of cash available for us to pursue growth opportunities, including from our industry leading development pipeline,” Campbell said in a statement.
“The timing of this capital return would hopefully provide some relief to any of our shareholders who might be struggling through the impact of COVID‐19.”
As it turns out, most of the money – $160 million – will be returned to its major shareholder Infratil, which gave its own Covid-19 uptake on Wednesday morning, reporting various falls in revenue from its investment in airports, New Zealand utility Trustpower and the impact on aged care homes.
Campbell says Tilt’s short term pipeline remains intact, with the company looking to vary a planning approval for the Rye Park wind farm to allow “tip height medication” to allow for more efficient and modern turbines. An investment decision is expected next year.
“Other smaller scale development opportunities (including batteries) are also expected to proceed to investment decision over the next 24 months, but with only minor equity funding requirements.”
Campbell told RenewEconomy it still expected to make a decision on the proposed 21MW/26MWh battery for Snowtown 1 this year, and it is also looking at another possible battery in Victoria, although that may depend on the impact of other competing proposals, such as Neoen’s newly revealed 600MW “Victoria big battery” that is seeking planning approval near Geelong.
