Morning, everyone. All from my side, thank you for joining us today in this conference call on the 1st 9 months of the financial year of 2019. Before I start with presentation, I would like to share with you an outline of the presentation and the procedure of today's call. I will start with an overview of the operational and strategic highlights of the 1st 9 months, followed by an in-depth analysis of the 9 months figures. After that, I will comment on our outlook for the remainder of the year before I will conclude my presentation with a brief update on the process of the ongoing voluntary public takeover offer by Morgan Stanley, Infrastructure Partners for P and E AG.
As always, we will then open the line for the sell side analysts only. All other participants will stay in listen only mode as it is in our company procedure for years. As usual, our slides that I will use can be found on our Investor Relations website. Having said this, I would like to start with Page 3, where we have the highlights of the 9 months over the 1st 9 months of this year. And we see this is mainly driven by the sale of international projects, high of international projects.
And we see with 404 Megawatts, which have been put into operation or started construction, we are on a very high level. You see 2018 with 130 megawatts, it's a very high level, mainly driven by the international projects. The biggest one is Jasna with 132 megawatts in Poland and Malabaget in Sweden with 113 megawatts in where we are working in the construction desk right now. And you see in the Q3, the results, we didn't expect very good results because we are on ongoing construction in these projects. Just right now, we have 331.7 megawatts under construction.
And additionally, we sold 1 project where we would like an operation project, Pappenbode, with 20.3 megawatts. We acquired this project due to the fact we would like to make repowering in the next 3 to 4 years. In Germany, we had been successful in tender with 37.5 Megawatts, which is in these times where the permitting procedures are in delay in Germany all over the market. You have heard it already, read it already that we are on a very low level in terms of commissions, whereby for it is very clear that this is often not a no go. It's a delay.
So we don't see any big impact on our pipeline in this country. Our wind portfolio, we work on as well. So 90.5, 7 megawatts are in operation or under construction. Still, we are working on our scale up projects and which is which where we talk about implementation of all the things we pointed out in our strategy approach until 2023. In Germany, we expand our PB business.
Just right now, we have on early stage 170 megawatts in Germany roundabout and 170 megawatts in Romania. We would like to expand this business in other countries as well like United States and Italy and France. In service businesses, we internationalized our business and strengthens with new projects and acquisitions of our business. So therefore, this altogether leads to the financial results we see on Page 4, which is the total output, which had been increased to €98,700,000 which is plus 71 percent in opposite to the last year. And the result of +-eighty 1 percent of the EBITDA and plus 166% on EBIT, which is clearly improved results, which are really improved results.
The EBIT is at SEK 9,900,000. And we are on a still high level of a gross cash position, which is €143,100,000 which still supports all activities we wanted to achieve. This all leads to a point, and this I would like to say in the beginning, we still confirm the guidance of the fiscal year 2019, which we set, which is an EBITDA from €25,000,000 to €30,000,000 and then EBIT to €15,000,000 to €20,000,000 If we look more into the details of the pipeline with onshore, we see that a lot of activities had happened in the international businesses. In France, we finished a project in Sweden. The project had been sold in Malabagat, which is, by the way, one of the biggest projects sold in this year in the Nordic countries.
Another project had been completed. So in Poland, this project Jasna with 100 and 52 Wigawatts is one is the project is the biggest project in Poland. We are just right now working on with 70 kilometers of high voltage line and big substation. So this shows what we can deliver. As well, we work on a project in Bavica in Poland.
In Panama, we stepped in, we acquired a pipeline, 5 projects. And in United States, we sold 1 project, Burley, which was mainly driven by the grid connection we sold, and this was a pure sale of project development in the mid stage. Remarkable is that we have our own power generation portfolio now at a level of 111.3 Megawatts. This includes the wind farm portfolio projects, as I mentioned before, 95 points 95 Megawatts in operation, other wind farms and this repowering project, Parparuda and our biomass project Silbitz. Our pipeline is still at a level of 5 gigawatts.
And if you look to the numbers of Phase III, which shows that we are in which projects we are in a procedure of for permitting procedure. We see that we have in Germany 302 megawatts and in France, 232 megawatts, which is a however of 532, 4 megawatts in these countries. And we hope that in Germany, in the short run, we get permissions out of this EUR 302 million. In the wind farm portfolio 2020, this continues, as I said already, 95.7 megawatts. The portfolio consists in 70.1 3 megawatts in operation.
Here is we have to understand now in wild triplets projects of around 74.4 megawatts are under construction and will be ready end of November beginning of December. So we are in the last stage of construction. Nevertheless, we have to say, as I said before, delays in Germany and permitting process can lead to delays. We would like to announce this on the early stage. Additionally, we see that the delivery of wind turbines in Germany haven't can lead to later delivery times.
And in this moment, for me, it is an issue because the manufacturers now deliver to foreign countries and shortened the level of delivery in Germany. So this will be end to the negotiation. The earnings accrued in the wind farm portfolio amount to approximately CHF28 1,000,000 now and has increased. The power generation is at CHF8.1 1,000,000 is a little bit lower than in the 9 months numbers of last year, mainly driven by one sale project of Gerdau Schwinnel. At that time, it was a onetime effect.
So wouldn't we have to consider would we have been in the last year at around €5,000,000 for this? We have a we are still on track to scale up. We said we would like to have the 1st project pipeline in development in this year. We stepped into Panama, and we are the 1st new market, the 1st project in development. We are in much more projects in development in PV.
We said we provide additional services. We acquired companies. We filed additional service and present in the auto market. And expansion of offshore development, we are working on in the United States and in other countries just right now to expense our business. Looking to the numbers, as operating results improved to in the yearly comparison.
As I said before, international project sales in Poland, milestone payments and results from the power generation. East are the main drivers for this. Remarkable is that the financial results, you see the last point, financial results burdened by higher interest expenses due to valuation of interest rate swaps, dollars 6,200,000 And it's always to consider as soon as the projects related to the swaps are sold, the swaps will not longer be consolidated and a corresponding positive contribution to earnings will result. We look to the business segments, employee development increase of plus 70% roundabout EBITDA plus 82%. In services, we have an increase of the output.
Nevertheless, the decrease in EBITDA is maybe mainly driven by the restructuring costs of the acquired companies. Electric Generation, the decrease is to 12 €1,000,000 despite the increase of our generation portfolio. And this is what I explained before is mainly driven by one sale before that's also impacted the EBITDA. And this year in the summertime, we had have a lower wind year. So take into consideration the high liquidity.
If you look to the balance sheet, we are in good positions, mainly an issue which relates to the buildup of the portfolio. We have an equity change also mainly driven by the IFRS 16 consideration. Mainly, you see the noncurrent debt has increased and the liabilities mainly driven by liabilities to banks related to nonrecourse financing. As I said before, if we build up a portfolio, it's maybe the debt for the project financing there, That's usual to increase the balance. Some and additionally, the increased some of the balance sheet is again outcome out of the IFRS 16 change.
Looking into the future. In the next quarter, as I said before, we would like we work further on, on the construction of the bigger projects. We these kind of projects need a delivery time or construction time, sometimes about 1 year because they are so big. We see that the project pipeline in Germany is with 534 megawatts in Phase III is full, and we hope that we get in the next couple of weeks some of these permissions on our desk. When you see Germany, we hope that we get in the next couple of week 2 projects, Langsdak Katzenstein, which in a total of 26.1 Megawatts, which we would like to go within the next tender.
But this depends on that we don't get a further delay in permission. We continue on build up our wind farm portfolio. We start we are still in sales processes and projects, let's say, in other countries. And we have to we work on our Panama projects and the PFI projects where we would like to go more internationally. We think we can go very fast into the next step of this early stage projects.
Additional services, we work very heavily on this to present some of them to the markets of these services and some consultic solutions as well. Again, we confirm the outlook of the financial year 2019 with an EBITDA of €25,000,000 to €30,000,000 and EBIT of €15,000,000 to 20,000,000 1,000,000. Ladies and gentlemen, that brings me to the end of my presentation with the update on the process of the ongoing voluntary public takeover by its intention to make a public takeover for P and E AG at a price of €4 per share in cash. Following Intensive talks, we, the Board of Management of P&T, with approval of the Supervisory Board, signed an investment agreement with Photon Management as the bidder. Photon is indirectly fully owned by MSIP.
The offer price corresponds to an approximate 31% premium in relation to the unaffected share price on 26 August 2019 of €3,000,000 or €3,000,000 5. The price before the publication of the ad hoc statement concerning the first confirmation of tax of P and E with MSRP. The offer values P and E with an equity value of approximately €300,000,000 The offer will provide for a minimum acceptance threshold of 50% plus 1 share and further customary offer conditions. The acceptance threshold does not include the treasury shares of P and E. Over the course of our talks, we have gotten to know MSRP as a highly professional and long term partner.
There's strong support for our long term business model and in particularly for our strategy scale up as well as for our employees in existing business units have convinced us. In the investment agreement, MSRP expressed a strong commitment to this strategy and supported also in financial terms. Together with us, the Board of Management, MSRP wants to continue to implement and even accelerate this strategy. Not least, we welcome the offer of attractive premium for our shareholders. Consequently, and subject to a thorough assessment of the final offer documents, we support the offer by MSIP.
Ladies and gentlemen, please allow me some remarks regarding the sequences over the last months. Neither the Board of Management nor the Supervisory Board actively invited offers to shareholders. MSRP has made an offer to the shareholders of P and E. Prior to this offer, MSRP approached us concerning a potential offer to our shareholders. Saifedown, in the interest of both the company and, in particular, of the shareholders and further stakeholders, the Board of Management and the Supervisory Board entered into a dialogue with MSIP in order to negotiate for an adventitious takeover as possible takeover offer as possible.
By doing so, both the Board of Management and the Supervisory Board met their duties towards the company, the shareholders of P and E and further stakeholders to the fullest extent. On 26, 2019, P and E confirmed talks with LSIP about a potential takeover in an ad hoc release. We also ask for external support in this process from experts specialized in takeover situations. Within this frame, the Board of Management and the Supervisory Board set up an orderly process, which included confidential talks with further potential prospective investors. Furthermore, the Board of Management tested the interest in a takeover bid among private equity companies, companies that were named in press articles following the ad hoc release.
Overall, these talks did not result in offers competing with the offer by MSIP Subject to this final statement in accordance with Section 27, Takeover Act by the Board of Management and the Supervisory Board on the offer document, we consider the offered purchase price of €4 per P and E share to our best knowledge as adequate. We have to stress that the initial indication by MS IP was €3.50 Only throughout the talks with PNE, the possible offer price range was increased to €3.50 to €3.80 at the time. After providing further value adding information to the investor, the offer was most recently increased to €4 per P and E share. Furthermore, we base our preliminary consideration of the adequacy of the price on the already conducted but not yet finalized analysis regarding the preparation of a fairness opinion performed by our external adviser. We will provide our final assessment of the adequacy of the offered price after careful review of the offer documents in our statement in accordance with Section 27, takeover.
Where are we now in the takeover process? Meanwhile, the offer document of MSRP has been cleared with the authorities and made public on the bidder's website, www.photon offer.com. All information, in particular, on the technical aspects ten range shares can be found there. According to the rules, quoting against Section 27, Checkover Act, we and the Supervisory Board will submit our final statement by mid November following the current careful review of the offer to cover. Until then, I will not comment on the offer beyond my remarks that I just shared with you.
I hope you understand. Ladies and gentlemen, this concludes my presentation. Thanks for your attention. We are now open for questions.
And we've received the first question. It is from Laura Lopez of Baader Bank. Your line is now open. Please go ahead.
Hi, good morning. So I have a couple of questions. From the around 41 megawatt of projects, which are under construction but have not been sold yet, do you expect this to happen in the Q4? Will this be the trigger for P and E to accomplish the guidance in the year? Or do you see any more drivers in the Q4?
And second question will be on the service business. So when we look at it year over year, the margins have actually deteriorated. And what is the reason for this? Were the are the recent acquisitions loss making and that's having like a negative dilution effect on the margin? Or it's actually just higher investments for your internalization strategy?
I will ask 2 other afterwards.
So, first of all, we have just right now 3 projects under construction, Kitlis, in Vallewood, which are the projects where we think they will be ready very, very soon. And these are projects for the project portfolio. And then we have 1 bigger project with 16.8 megawatts, Berzdekendorp where we started already our construction and where we think we will be ready at the end until end of the year. And this project will be on bigger will affect certainly the guidance and because we have one bigger EBIT to expect from this project. Related to the service, yes, we have to flip some internal calculations and internal personnel.
And we are just right now to get these things sorted in service so that we have a final very strong service group. That means also that the headcount and changes related to this is one the overhead costs and all this stuff is now that has to be sorted. We started with this in February, as you remember. And on the other side, there are some effects on this. On the other side, we have higher investments in exactly what you said before in taking over companies, structuring restructuring costs and depreciation, but restructuring costs are mainly driven by this.
But this is not a big issue. We think that the numbers will increase in future.
Okay, very good. And then maybe actually just one more. You mentioned can you maybe explain again that what you mentioned about also some risks or some issues with wind turbine manufacturers with the delivery times. Can you explain that again? Is it something about that they are delivering more to the international market?
Yes.
And do you recently, there were several announcements in Germany or by the government, I think around September, positive announcements. But have you seen any slight progress in the approval process? Or everything is exactly the same? And do you expect this to improve in the near future?
Yes. Related to the wind turbines, we have the situation that the manufacturers have huge American market just right now, where they have to deliver related to the PTC tax issues and now the big projects are has to be to be delivered. Secondly, they lowered their delivery contingent for Germany. So therefore, with the Senvion, which is not anymore in the market, we see that there is a further step of lower delivery from wind turbines in Germany. So therefore, that is where now customers like to get wind turbines from other manufacturers, which are not planned.
So this is something where which lead to delays in delivery times, we are still in discussions and negotiations with manufacturers to secure them. So related to the approval situation in Germany, politics is very clear that this is a structural problem in terms of permissions, mainly driven by changes in the law that so that leads to 1 year longer times for studies, and this is now usually a onetime effect in this respect, but nevertheless, they want to change something in terms of permitting structure to that should lead to lower longer shorter times for permissions and that these longer times will not occur anymore. So we will see what is the outcome. Nevertheless, again, we have no projects in our pipeline where we've seen no goes. These projects, this is always a matter of time.
It's not a matter of go or not go. Thank you.
Thank you. The next question is from Carsten von Rumtal of First Berlin Equity Research. Please go ahead. Your line is now open.
Good morning, Markus. This is Karsten from First Berlin. Markus, you mentioned that the interest rate swaps resulted in a negative interest and similar expenses figure. And you said that this will be reversed when the project is completed. So do you expect a positive effect this year already?
Or will we see this next year?
No. This is mainly related to the project financing of our portfolio. And when we sell projects, we then have no effect anymore. And when we expect to sell them, then the reverse may happen or will happen. And just right now, there is no effect to expect this year.
Understood. It is referring to your 2020 portfolio, so we can
Exactly, mainly driven by this because you want to secure the interest rates. Because A long time, everybody thought the interest rates will increase, and now the interest rates went down. And so it's an effect, a balance effect, and this is what we have to consider, which is when you sell the project, you have still the interest rate of your financing, so there is no change to expect.
Yes, perfect. Understood. Then you mentioned that you bought the assets of the Parma Rode project, 22.3 Megawatt. And so this is an old wind farm, which you would like to repower in coming years. And the current capacity is 22.3 Megawatts.
And any idea what the repowered capacity could be? Is that roughly the same? Or could it be higher?
Yes. First of all, it's not an old project. It's the best age, I would say. So and secondly, we do a lot of measurements to improve the output of the already existing wind farms. So even if we stick with this project, we will be on the positive side.
And if we do a repowering, then we think about it as a range of megawatts we could take out of this, but that depends on the commission structure. I will not say just right now how much megawatt it could be because it depends all the time on the actual wind turbine in this year and that year when we would like to repower that.
Okay. But for the time being, this project will then add to your electricity generation? Exactly. Okay. Good.
Then you mentioned your solar business and that your pipeline consists of roughly 170 megawatt in Germany and 170 megawatt in Romania. When do you think the first projects will be constructed out of that portfolio?
Yes. We are in early stage in this kind of project. And but we think we hope that in the next year, the first project we can get something out. But nevertheless, the year after, we see a bigger amount of megawatts coming out of the PB business.
All right. Last question from my side. Your 2020 wind pump portfolio now has a capacity of 75.7 Megawatts. And for additional projects, you need approval, which as we well know is currently a very tedious and frustrating procedure. So from now looking into the future, it looks to be rather challenging to achieve something like 200 Megawatt at the end of 2020.
So what do you think could be a realistic total capacity for the portfolio at the end of 2020?
Yes. Just right now, we that's why I came up at this point in this moment because we are 1 year 3 months for the end of next year. So and the next projects we see is 26 megawatts we would like to get in the next tender, which depends on debt that we get the next week. So this is so and we think we are still on a path that we think we come close to 200. But to say how much it is, I can't say.
It depends all the time. We have 302 2 megawatts just right now in permission status, and a lot of them are should have been permitted. So and depending on that we have always took the procedure for the tendering. Yes, so therefore, I can't say just right now which will come up, but I think that is you're absolutely right. I don't see the 200 megawatts really.
This is very challenging. It becomes very challenging just right now. Due to the delays in the permitting process and the delivery times of wind turbines, it's December, and then I will have a much better future.
All right. Thank you very much for taking my questions.
Thank you. The next question is from Holger Stephan of S&P Research. Please go ahead. Your line is now open.
Good morning. Roger Sheffen speaking. I have first, I have an additional question about the development of the wind farm portfolio. Regarding the delays, is it possible that you will shift the sales process to the year 2021? Or you will or do you will sell a smaller portfolio next year?
Is it preferred?
Yes. In any case, as I said before, it's always an issue of delay, and there are these two options are there. And I would like to come back to you on the next quarterly message and will give you an outlook on this. Just right now, we're still in good hope that we get some permissions. We don't know how much, but you see the potential of 300 megawatts.
This is huge, and we hope that some of these projects will come. And then we know much more at the end of the year where we are.
Okay. In former time, you planned to or possibly to add some projects to the wind farm portfolio. Is this still an option?
Sorry, what did you say, some Post
projects for the wind farm portfolio.
No, we are working with our own portfolio and with our own projects and projects. The thing which it may be that we sell the projects even when they are under construction as we did in the last time and projects and it might happen that we can negotiate it with projects which have permissions or in the tender were part of such a project pipeline as well. So this is we sold already projects packaged in France where we have had only project rights. And after permission, then we get our milestones. And so you can make this combination.
This is possible. So therefore, it depends all on that what we think when the permission will occur, when we'll get it. And then we can make our plan. Just right now, we are in with hope, but we see that this target is very challenging, In any case, to get it constructed 200 megawatts, this is not really what we see.
Okay. In your report for the 1st 9 months, you gave us only few information about the development of your pipeline in France. Maybe can you give us an outlook when the next project in France could be ready for sale?
For sales, yes. We already sold projects in France. And this year, we got our milestone payments to Lapeyre and which was one project, one good project in France. And further projects are we have the packages where we get milestones payment. When we get the next projects in France, this depends again on the permission process, where we have usually one year to extend because roundabout 90% of the projects in France will be sued and led in the front of court.
And usually, if you made a proper work, you get right and you can go ahead with the construction. So but just right now, I can't give you the number. Of course, out of this 230 megawatts, there are some projects where we think that will come up in a short time. And then just right now, we would like to have a portfolio, for example, as for German projects, and we don't intend in the moment that we put French project in that. But that's exactly the issue.
What we would like to discuss when we have more overview about the permission status in these countries.
Okay. The U. S. Project, Shilohko, should be ready for sale this year. Maybe could you give us an update about the process?
Yes. At Silocco, we have the situation that we restructured the project. Even if it is now as 166 megawatts, it is a higher output to expect there to lower the low CEE and being competitive with the prices on the energy market there. So we hired a new adviser for sales, and we are just in the process, again, I have to say, to pro sale. Additionally, there's some issues around the grid connection and I have to consider this as well.
Grid connection there where the local utility is working on extension of the transformer stations and such issues will affect the sales status as well. But this is something which is just right now in consideration in the discussion.
Okay. So you can't say if you will manage to sell the project this year?
I'm not sure if you get it sold this year. But nevertheless, it changed nothing on the guidance. Okay.
In your report, you've mentioned 4 projects, which were successful in the German tender this year. I think I found 5 projects,
Sclenther, I have not here on my list. I think Sclenther was in last year, but I'm not sure, to be honest. My list, Sclenther was at the end of last year, but I'm not sure, to be honest. Okay. Can you give us some more time?
The rest is right.
Okay. Can you give us some more details about the project Gieveschats in Germany, which were successful in September, I think?
This is Village 10.8 megawatts. This is a project where we have where we still have to yes, we're working just right now on this project to start construction, exactly. And next year, and it will be a part of the portfolio in the future. And so next year, we will start construction.
I did send the megawatts figure?
8.8 Megawatts for village that it is was called.
Okay. And my last question, perhaps some information about Klein Willetheim, which won a tender in February. I didn't saw an update to this project.
Yes. This project is a project which has some difficulties in permitting requirements. So we have to solve some of these issues. And there, we are working heavily on. But we think this is a project for next year as well where we would like to step through,
Thank you. At the moment, there are no further questions. So I would hand back to you.
Yes. So thank you very much to attend this call, and I wish you a good day.