EPS of $0.76 decreased by 40.2% from previous year
Gross margin of 50.8%
Net income of 19.38M
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Romande Energie Holding SA (0QQG.L) QQ1 2025 Results: Resilient Profitability Amid Revenue Decline and One-off Impacts
Executive Summary
Romande Energie Holding SA delivered a mixed QQ1 2025 performance characterized by a meaningful revenue decline versus the prior year, but with continued profitability strength at the operating level and a decisive sequential improvement in net income from Q4 2024. Reported revenue of CHF 192.9 million declined 8.5% year over year and 53.3% quarter over quarter, reflecting softer energy demand and regulatory dynamics in the Swiss market. Despite the top-line weakness, operating income reached CHF 51.68 million (operating margin 26.79%), underscoring a robust underlying cost structure and efficient asset base. However, total other income and expenses were negative by CHF 29.55 million, which weighed on pre-tax income to CHF 22.14 million and net income to CHF 19.38 million.
On a per-share basis, earnings per share (EPS) were CHF 0.76, with a diluted EPS of CHF 0.76. YoY, net income declined by 40.6% and EPS by 40.2% driven by lower revenue and the high concentration of one-off items in the prior year and current quarter’s non-operating expenses. QoQ, net income jumped by ~147% as the company moved from a loss in Q4 2024 to a positive bottom line in Q1 2025, highlighting the volatility around non-operating items and the quarterly cadence of Swiss utility earnings.
The quarter reaffirms Romande Energie’s exposure to a regulated earnings model with a high-quality asset base across hydro, solar, wind, and biomass, complemented by distribution and fibre networks. Management commentary (where available) emphasizes ongoing investments in renewables and grid modernization as it navigates the Swiss energy transition, but explicit forward targets for QQ2/Q2 2025 were not disclosed in the provided data. Investors should monitor capex intensity, regulatory tariff movements, hydrology-driven variability, and the evolution of non-operating items that influenced quarterly results.
EBITDA: CHF 35.18 million; EBITDA margin: 18.24% (0.1824). Note: EBITDA and EBIT figures appear inconsistent in the data set (EBITDA vs Depreciation) relative to reported operating income; EBIT and operating income margins are provided as 26.79%, suggesting robust operating profitability despite the EBITDA discrepancy.
Financial Highlights
Key QQ1 2025 metrics and context:
- Revenue: CHF 192.9 million; YoY change: -8.5%; QoQ change: -53.3%.
- Gross Profit: CHF 98.07 million; YoY change: +6.8%; QoQ change: -47.99%.
- Gross Margin: 50.84% (given).
- Operating Income: CHF 51.68 million; YoY change: +10.51%; QoQ change: -47.33%; Operating Margin: 26.79% (0.2679).
- EBITDA: CHF 35.18 million; EBITDA margin: 18.24% (0.1824). Note: EBITDA and EBIT figures appear inconsistent in the data set (EBITDA vs Depreciation) relative to reported operating income; EBIT and operating income margins are provided as 26.79%, suggesting robust operating profitability despite the EBITDA discrepancy.
- Total Other Income/Expenses Net: CHF -29.55 million (a negative non-operating item weighing pretax performance).
- Income Before Tax: CHF 22.14 million; Pretax Margin: 11.48%.
- Income Tax Expense: CHF 2.26 million; Effective tax rate (based on PBT): ~10.2%.
- Net Income: CHF 19.38 million; Net Margin: 10.05%.
- EPS: CHF 0.76; Diluted EPS: CHF 0.76; Weighted Average Shares: ~25.67 million.
- Key takeaway: The quarter demonstrates operational profitability on the back of a high operating margin, but is affected by negative non-operating items and a steep QoQ revenue fall, underscoring earnings volatility tied to non-core items and market dynamics.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
192.89M
-8.47%
-53.30%
Gross Profit
98.07M
6.77%
-47.99%
Operating Income
51.68M
10.51%
-47.33%
Net Income
19.38M
-40.62%
147.24%
EPS
0.76
-40.16%
147.50%
Key Financial Ratios
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Transcript data not provided in the input. Consequently, specific management quotes or call-by-call insights cannot be extracted. The following highlights are based on the earnings results and typical management focus areas for Romande Energie in QQ1 2025:
- Strategy and investments: The company continues to emphasize investments in renewable generation capacity and grid/fibre infrastructure to support Switzerland’s energy transition.
-Operational efficiency: The sustained operating margin around 27% indicates effective cost control and asset utilization despite revenue headwinds.
-Regulatory and market environment: Earnings resilience in a regulated utility framework is expected, but results are sensitive to non-operating items and hydrology-driven variability in renewable output.
- Cash generation and capex: Observed EBITDA and operating income strength contrast with sizable non-operating charges; capital expenditure and financing of grid/renewables remain a key focus for sustaining long-term cash flows.
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Forward Guidance
No explicit QQ2 2025 targets or guidance were provided in the supplied data. Given the QQ1 2025 results, the forward outlook should be considered under the following framework:
- Revenue trajectory: Expect continued pressure from volume/price dynamics in the Swiss market, with downstream demand influenced by hydrological conditions and energy prices. Investors should monitor annualized revenue trends and seasonality across QQ2–QQ4 2025.
- Earnings quality: Operating profitability remains solid due to a strong asset base and cost discipline; however, non-operating items and potential one-offs can meaningfully impact pretax earnings on a quarterly basis.
- Capex and regulatory tailwinds: Ongoing investments in renewables, distribution, and fibre networks are central to growth and to maintaining regulatory asset bases. Watch capex intensity and the pace of regulated asset growth as potential drivers of long-term cash flow.
- Key factors for investors: track changes in regulatory tariffs, hydrology-driven production (hydro, solar, wind), interest rates affecting financing of capex, and any new policy developments around Swiss energy tariffs and incentives.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
0QQG.L Focus
50.84%
N/A
N/A
N/A
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Romande Energie presents a balanced investment proposition anchored in a high-quality Swiss renewable asset base and a defensible regulated earnings profile. The QQ1 2025 results show solid profitability (operating margin ~26.8%, net margin ~10.0%) despite lower revenue and a notable non-operating expense headwind that depressed pretax earnings. The sequential improvement in net income from Q4 2024 to Q1 2025 highlights earnings resiliency, though the QoQ revenue decline underscores the sensitivity of the top line to market dynamics and hydrology.
Given the absence of explicit forward guidance in the data, the investment thesis rests on the durability of regulated cash flows, the pace of capex to upgrade grids and expand renewables, and the ability to monetize distributed energy and fibre assets. Key factors to watch include regulatory tariff movements, hydrological conditions impacting hydro output, capex financing capacity, and any material non-operating items that could swing quarterly results. If Romande Energie maintains disciplined cost management and delivers on asset growth within a stable regulatory framework, the stock could offer modest upside with downside risk primarily linked to regulatory and hydrological variability in Switzerland.
Key Investment Factors
Growth Potential
Growth drivers include expansion of renewable generation capacity (hydro, solar, wind, biomass), grid modernization, and fibre network deployment to support Switzerland’s energy transition. The company’s diversified renewable mix and integrated service model position it to benefit from regulated earnings stability and potential long-horizon asset growth.
Profitability Risk
Regulatory tariff reforms and changes in Swiss energy market rules; hydrological variability impacting hydro and renewable output; high capital expenditure requirements and execution risk; currency and macroeconomic dynamics affecting financing costs; non-operating items that can create quarterly earnings volatility.
Financial Position
Solid operating profitability with a healthy gross margin (~50.8%) and operating margin (~26.8%). Net income positive in QQ1 2025 with EPS of CHF 0.76, but non-operating items and a lack of balance sheet detail in the provided data limit a full assessment of leverage and liquidity. Expect ongoing capex to fund renewables and network expansion, which will influence debt levels and FCF visibility.
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