First impression Zazz Energy, Q4 2022: Large write-downs and continued production standstill

Today, Zazz Energy published its interim report for the fourth quarter of 2022. Below is a summary of our first impressions of the report’s outcome and the income statement’s deviations from our estimates (set before information on production standstill).

• Net sales in the fourth quarter amounted to SEK 0 million. Our estimate was SEK 0 million following the production standstill earlier communicated by the company. However, as in the third quarter, Zazz Energy is being compensated for lost revenues; thus, total revenue amounted to SEK 1,7 million.
• The compensation does not cover fixed costs related to either the Swedish or Greek operations. Other external costs also increased compared to Q4 2021 and the EBITDA result amounted to minus SEK 9.0 million. We had estimated an EBITDA result of minus SEK 1.5 million. The deviation is partly attributable to Other external costs, which came in clearly above our expectations.
• Including other income, the EBT result amounted to minus SEK 23.4 million due to a major write-down of both tangible and intangible fixed assets of approximately SEK 13.6 million. Our forecast was minus SEK 2.1 million, but without major write-downs included.

We believe that the risk surrounding Zazz Energy has increased significantly, and we intend to provide an updated research report on Zazz Energy shortly. Read the latest resarch update here.

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