Good Energy Group PLC

("Good Energy" or "the Company")

Un-audited results for the 12 months ended 31 December 2023

Significant period of transformation from renewable supply to fully integrated energy services

Good Energy, the renewable electricity and energy services provider, today announces its preliminary results for the twelve months ended 31 December 2023.

Financial highlights

·      Revenue increased 2.4% in the period to £254.7m (2022: £248.7m) driven by the high commodity cost and cost of sale environment present at the start of 2023.

·      Reported gross profit increased 47.9% to £44.2m (2022: £29.9m).  Gross margin increased to 17.4% (2022 12.0%). Gross profit and gross margin increased due to a strong H1 2023 performance and cost advantages from our power purchase agreements.

·      Reported profit before tax of £5.7m compares with an underlying PBT of £1.4m in 2022.  This improvement reflects recovery of margins in 2023 following 2022 wholesale price spikes.

·      Good Energy recognised a loss of £2m in relation to its share of the losses recognised by Zapmap in the year.

·      Reported profit after tax for the period of £2.9m (2022: £8.6m, 2022 included a one off £7.8m valuation uplift related to Zapmap)

·      Reported basic earnings per share reduced to 17.1p (2022: 55.7p).

·      Cash and cash equivalents of £41.3m (2022: £24.5m) reflecting strong profitable performance, but also a £9m year on year growth in customer credit balances.

·      Following robust operational performance in 2023, and reflecting our confidence in the ongoing business, the Board recommend a final dividend for 2023 of 2.25p per ordinary share (2022 2.0p).

Operational highlights

·      In just over 12 months we have successfully completed three acquisitions, enabling Good Energy to offer heat, EV charging and solar installation services:

o  Fully integrated Good Energy heat pumps following December 2022 acquisition into wider business to offer unified premium, bespoke, end-to-end Good Energy heat pump installation services.

o  Acquired solar installation company Wessex ECOEnergy Limited in June 2023, establishing high quality solar and storage services in the South West.

o  Post year end in February 2024, delivered the acquisition of solar installer and wholesaler JPS Group, establishing solar and storage installation services across the South of the UK. Acquisition partially funded through the issue of new shares, of which approximately £2.1m were placed with new and existing shareholders.

·      Good Energy is now established as a microgeneration specialist, offering quality, end-to-end solar and heat pump installation alongside tariffs and services to a premium segment of a rapidly growing market.

·      Maintained differentiated 100% renewable electricity supply offering -

o  Domestic supply accredited with top Which? Eco Provider ranking for third year running and achieved five-star TrustPilot rating from customers.

o  Launched industry first hourly renewable matching service for business customers to provide greater transparency.

·      Progressed innovative export product rollout, transitioning +60,000 Feed-in-Tariff customers to smart export and launching industry leading new export tariff for non-tariff customers out of beta, with enhanced rate for solar installation customers.

·      Successfully trialled 'Power Pause' customer demand flexibility as part of the National Grid Demand Flexibility Service.

·      Zapmap increased registered users by 41% to +780,000, maintaining +70% market share in growing electric vehicle market.

Outlook highlights

·      Heat and solar markets continue to see rapid growth -

o  UK solar market worth £1.9bn, installations increased 38% in 2023, anticipated to grow to £4.6bn by the end of 2030.

o  Air source heat pump installations grew 20% in 2023, UK government targeting 600,000 installations per year to 2028.

·     Good Energy now established to offer premium, end-to-end solar and heat pump installation services.

·     Differentiated green supply and market leading export products position Good Energy to cross sell a 'greener whole home or business' proposition, providing carbon and running cost savings for climate conscious customers. Higher margin installation services lead to higher margins on recurring services including supply, flexibility and export. 

·     Trading in 2024 has started in line with management expectations. Both revenue and cost of sales are expected to be significantly lower in 2024 reflecting lower wholesale costs and associated tariffs in the supply segment of the business. 2024 is also expected to see a return to more normalised supply segment margin levels.

·     Energy services segment to be a material driver of Group profitability by 2025.

Nigel Pocklington, CEO, Good Energy Group plc:

"Against a backdrop of continued volatility in the energy market, 2023 saw Good Energy undergo a transformation from pure renewable supply and Feed-in-Tariff administration to a fully-fledged clean energy services business.

"Following multiple acquisitions in the heat and solar space we can now offer customers premium services across supply, export, heat pumps, solar PV, storage and EV charging. Alongside this, we are now a leader in smart export for small scale solar and have trialled innovative flexibility services for businesses and consumers to shift their demand to cut their carbon further. Good Energy is establishing itself as the microgeneration specialist for the premium end of a rapidly growing market, offering everything a home or business needs to go greener, from a trusted brand with unparalleled expertise.

"Good Energy has had a strong financial performance in 2023 and we have a strong balance sheet to continue to invest in the future. We continue to see strong, sustainable growth in the clean energy services space which Good Energy is ideally positioned to capitalise on."

A video overview of the results from the Chief Executive Officer, Nigel Pocklington, is available to watch here:

 https://www.fmp-tv.co.uk/2024/03/26/good-energy-ceo-interview/

Enquiries

 About Good Energy www.goodenergy.co.uk

Good Energy is a supplier of 100% renewable power and an innovator in energy services. It has long term power purchase agreements with a community of over 2,000 independent UK generators.

Since it was founded 20 years ago, the Company has been at the forefront of the charge towards a cleaner, distributed energy system. Its mission is to power a cleaner, greener world and make it simple to generate, share, store, use and travel by clean power. Its ambition is to support one million homes and businesses to cut carbon from their energy and transport used by 2025.

Good Energy is recognised as a leader in this market, through green kite accreditation with the London Stock Exchange, Which? Eco Provider status and Gold Standard Uswitch Green Tariff Accreditation for all tariffs.

Chair's review

Overview

2023 was the year we set out to build on the progress made on our energy services strategy in 2022, and I'm pleased to say that this has been successful. We have launched new, innovative solutions, acquired further installation capability and delivered leading customer service levels. Against the backdrop of a stabilising energy market, we have delivered a year of strong financial performance.

Good Energy is dedicated to powering a cleaner, greener future. This year, the Company has advanced this mission with strategic acquisitions, strengthening our position as a leader in the UK's transition to net zero. Our efforts in solar services and installation across key regions underline our commitment to this vital shift, reflecting our role in driving forward the nation's decarbonisation agenda.

For our customers, they have access to a trusted partner which can now facilitate their ambition to install, consume and generate green power for their home or business, and which can also ensure they earn more from the power they generate.  For our investors, they have exposure to a highly exciting growth market and are benefitting from the value creation achieved through our investment into Zapmap. This growth and expansion is underpinned by a stable energy supply business operating in a more steady UK energy environment with forward looking power and gas prices returning to levels seen prior to Russia's invasion of Ukraine.

Despite this environment, prices remain high in historic terms. The rising costs emphasised the need to shift away from fossil fuels and encouraged people to insulate themselves from the high prices by switching to solar power, with record numbers of rooftop installations taking place in 2023.

Also in the period, as part of Ofgem's compliance work Good Energy was ordered to pay £1.25m into the regulator's redress fund and an additional £368,404 in goodwill payments to customers. This was following the surfacing of an issue relating to payment method changes which originated from a process change made in 2019. The issue, which was self reported as soon as it was apparent, has since been addressed with new automated processes, standard and governance which the Board is confident will prevent any similar mistake in future.

We exited the year in a strong position.  We have a robust balance sheet, continue to invest in high growth markets and are helping more homes and businesses save money and decarbonise.

Strategic developments

2023 was a transformational year for Good Energy. Last year, I talked about the strong platform that we had built to deliver our energy services strategy in 2023. We have accelerated progress through the acquisition of three installation businesses, roll out of innovative, market first, solar service solutions, whilst maintaining a high level of customer service and operational efficiency.

Supporting our ambition to help one million customers cut carbon by 2025, we have acquired a heat pump installation business, Igloo Works, and two solar installation businesses, Wessex ECO Energy and post period end, JPS Group.

Good Energy is now positioned as one of the leading installers in the South of the UK focused on a bespoke, high quality service offer.

Capital allocation

Our substantially debt free position and strong cash balance allows us to continue to invest for sustainable growth and deliver potential further acquisitions in energy services, which is reflected in our capital allocation policy. Post period end, in February 2024, we raised £2.1m through a vendor placing as part of the JPS Group acquisition, testament to investor support for our ongoing energy services strategy. We welcome our new, supportive institutional shareholders.  

We recognise the importance of a dividend to many shareholders. Following a strong operational performance in 2023 and reflecting our confidence in the ongoing business, the Board recommend a final dividend for 2023 of 2.25p per ordinary share, taking our full year dividend to 3.25p (2022: 2.75p).

Board

On behalf of the Board, I am delighted to welcome Fran Woodward to her new role as a Director on the Good Energy Board. Fran joined the Board on 20 October 2023 and is, currently, Good Energy's Chief Operating Officer. Fran has been an integral part of Good Energy since 2014, steering vital functions such as Sales and Energy Origination, Marketing, Customer Operations, and the People and Culture departments. Her extensive leadership experience, gained from notable organisations such as Marks & Spencer, Coca-Cola, Dyson, and EDF, has been instrumental in ensuring that our customers remain central to our strategy, operations, and culture.

Looking ahead

The Board has confidence in Good Energy's strategic direction and future prospects. In the short term, trading has commenced in line with management's expectations. Further ahead, as a trusted brand with an array of high quality services under one roof, Good Energy is well positioned as a premium specialist in the rapidly growing microgeneration market. We have a proven track record of delivering on our strategy and we look forward to creating further value in 2024 and beyond.

Will Whitehorn, Chair

CEO's review

The energy market will be transformed in the next ten years. A mass transition towards small-scale, low carbon technologies is taking place. And Good Energy, with its purpose to create a cleaner, greener world and following a transformational year itself in 2023, is ideally positioned to help drive this transition.

Small scale solar (below 50kW) installations increased 38% in 2023 (MCS), from an already significant doubling in the install rate in 2022 as households and businesses looked to insulate themselves from rising energy costs. The UK solar market, worth £1.9 billion today (MCS), is anticipated to more than double to £4.6 billion by 2030 (LCP Delta). With only 8% of potential homes currently equipped with solar installations, there's a vast potential for increase. The South and South East regions of the UK are leading in market share and installation rates, demonstrating strong growth. Similarly, air source heat pump installations have increased, supported by government incentives.

Air source heat pump installations also grew 20% last year to over 35,000, with an enhanced government grant introduced late in the year. Whilst this market is more nascent than solar, the government remains committed to its target of hitting 600,000 installations per year with heat pumps being the primary method through which the UK will decarbonise its heating.

Against this backdrop energy supply remains a challenging business. Margins, especially for domestic supply, have long been slim. High prices over the past two years have not changed this, and whilst they have reduced somewhat from their highest heights the market remains volatile comparative to pre-energy crisis. In this period we have delivered another strong financial performance in 2023, whilst activating our strategy through the roll out of new tariffs and services alongside investment in our installation footprint.

Delivering on our vision

Good Energy has long set out a vision for a decentralised, decarbonised energy system in which suppliers are no longer purchasing electricity and gas from a few large generators and supplying it to customers, into one where smart, clean technologies create a more participatory system. We are now seeing this vision realised with the flaws in a fossil fuel based energy supply system now more apparent than ever; installations of small scale decentralised clean technology surging and smart meter adoption is now predominant. And Good Energy is poised to play an important part.

Following three acquisitions in a little over 12 months Good Energy now offers everything you need for a greener home or business. Renewable electricity supply, solar, storage and heat pump installation, EV charging, export tariffs and we are now introducing flexibility services to make all of this technology work for the customer.

What this creates is not only a business that remains committed to its purpose of creating a cleaner, greener future, but one that can provide more value to customers and greater returns. Installation services are significantly higher margin than supply. One off installations also pave the way for recurring revenues through other services including smart export, supply, flexibility and maintenance.

The Good Energy brand, with our 25-year history as a truly green renewable innovator, positions us ideally as a trusted partner for customers looking to go green.

Truly renewable supply

Renewable supply is the foundation on which Good Energy's strategy is built. Itself a model in decentralisation, as we source the power we supply customers via agreements with over 2,000 independent renewable generators across the UK. Good Energy's renewable electricity supply remains recognised as a greener product.

In 2023 we retained our Which? Eco Provider accreditation, the only supplier to have scored top in all three years the consumer rights organisation has been ranking the environmental credentials of green suppliers. We continue to hold the Uswitch Green Tariff Gold Standard for all of our tariffs too, and are the only supplier with Good Housekeeping's Getting Greener label for 100% renewable electricity. Our customers continued to provide positive feedback on our service too, pushing our rating on TrustPilot to five stars - one of only two UK energy suppliers which are rated so highly.

We made a significant step in differentiating our supply product for business customers too. As part of our criticisms of the current unit based certification system for renewable electricity Good Energy has supported a shift towards time-based matching. Now there is more widespread acceptance of the problems with unit based certification - Renewable Guarantees of Origin or REGOs in the UK - there is also a growing movement towards time based. Pioneered by tech giants like Google, which has set a 2030 goal to be powered by '24/7 carbon free energy', there is now a UN compact for the system, which the US government joined during COP28.

Good Energy already traded power with the aim of matching customer demand to the output from our renewable generators as closely as possible, achieving around 90% matching in half hour intervals on an annual basis for the past five years - a very high level enabled by our decentralised, distributed generation portfolio. In 2023 we partnered with technology platform Granular Energy to provide our half hourly business customers with the insight on how their energy use is being matched, creating a new level of transparency and paving the way for flexibility and incentivisation for new technologies such as storage.

As electricity supply in the UK moves towards market wide half hourly settlement and the location based pricing model proposed in the Government's second consultation on Review of Electricity Market Arrangements, Good Energy is ideally positioned.

This is a new frontier for renewable supply and Good Energy is leading the charge.

Solar and smart export

Good Energy is the UK's second largest solar power payments company. As the progenitor and largest voluntary administrator of the Feed-in-Tariff, we have long been a significant participant in the small scale solar market. But 2023 was the year we became an installer, closing the loop to become an all-in-one solar services provider.

In June, we acquired Wessex ECO Energy. Wessex is a registered MCS, RECC and Tesla Energy Certified solar installer and service provider, based in Dorchester, for domestic and commercial customers with an established team of engineers, technicians, and operations specialists. It has a strong brand predominantly covering the South West of England and a proven track record of high-quality installs with a 5* Google review rating.

Whilst in February 2024, we completed our largest acquisition to date of JPS Group, a specialist solar and storage installation and distribution business, and its wholly owned subsidiary, Trust Solar Wholesale Limited ("Trust"), a standalone distribution and procurement business based in Maidstone, Kent. The acquisition was partially funded through a £2.1m vendor placing. I would like to thank new and existing shareholders for their support.

The acquisition of JPS Group marks a pivotal moment in Good Energy's strategy, reinforcing our role as the UK's leading solar specialist. The solar sector is booming, reflecting its critical role in our energy transition. Good Energy, a key player since the Feed-in-Tariff era, now serves over 180,000 solar customers, illustrating our significant influence in this space. In 2023, the solar market reached £1.9 billion, with a 38% increase in installations, particularly in the South East, the fastest-growing region. JPS Group, known for its expertise in complex solar solutions for larger properties, complements our mission to supply high-quality, sustainable energy solutions.

By integrating JPS Group with our existing offerings, including solar, storage, and heat pumps, we're not only expanding our market presence but also introducing our comprehensive energy solutions to more customers. This strategic move consolidates our position as industry leaders and enhances our ability to meet the increasing demand for clean energy.

In tandem, we continued to innovate in the export tariff market. We converted over 60,000 Feed-in-Tariff customers to smart export and launched our market leading Solar Savings export tariff - open to FiT and non-FiT generator customers alike. We also introduced an enhanced Solar Savings rate for customers who install solar with us, providing an end-to-end customer benefit for choosing Good Energy.

Heat

Following the acquisition of Igloo Works in December 2022 we successfully integrated this heat pump installation business into Good Energy, rebranding and merging shared functions including marketing, sales, HR, finance and legal.

As with solar, Good Energy's positioning is at the premium end of the market. We offer customers bespoke design and end to end installations suiting more complex properties. In addition Good Energy heat pumps come with a 10 year warranty and a remote performance monitoring service that ensures their heating is running efficiently, providing reassurance to customers. Our average installation is 7.5% larger than the average system size compared to the top 200 UK installers, delivering at an average margin of 25% to 30%.

Product pipeline

In addition to the rollout of new tariffs, shift to smart export and increase in smart meters to over 46,000, Good Energy further innovated in 2023. We trialled flexibility through 'Power Pause', our implementation of National Grid's Demand Flexibility Service, paying customers to shift their energy usage away from peak times - a successful pilot we intend to build on in 2024. We implemented efficiencies in our digital services by refreshing our customer app and portal.

Looking ahead we plan to utilise digital to further drive efficiency whilst improving the customer experience, introducing new features like Apple and Google pay in our app.

We have new partnerships and tariffs planned including a tie in with Zapmap, offering Good Energy EV tariff customers free premium subscription to the app. And we will be introducing new recurring revenue streams through maintenance and servicing for our installation customers.

We know that flexibility is the key that unlocks much of the value of having a greener home or business. Shifting when and what you import, export, store or share to the benefit of the customer, grid, and Good Energy. Having trialled demand flexibility in 2023 we are looking to expand this into 2024. 

Zapmap

As the adoption of electric vehicles continues to grow, now hitting over a million battery electric vehicles on UK roads, Zapmap has continued to maintain its leading position.

The business underwent a refreshed brand and strategy in 2023, now operating on three fronts. The first being the consumer app and web interface. With 1.4m downloads and 780k registered users, Zapmap serves 330k active users per month looking to search, plan and pay for EV charging.

Launched in 2023 came Zapmap Spark, an API product which enables partners to seamlessly integrate Zapmap's market leading services and data into their products.

Lastly Zapmap Insights provides another market leading service to other businesses and partners, providing Zapmap's unique data - from charge point operators and EV drivers - as a service. Zapmap provides data on 95% of public charging points in the UK, with 75% showing live data and 25% coverage for payments through the app too.

In late 2023 Zapmap piloted expansion into mainland Europe, allowing users to search for and find charge points in France, Germany, Belgium, the Netherlands and Luxembourg.

A further funding round is required in 2024 to deliver Zapmap's growth strategy, Good Energy remains a supportive shareholder.

Everything for a greener home or business

Good Energy's purpose has always been to power a cleaner, greener future. Throughout the company's history it has innovated in renewable supply and helping microgenerators, with the goal of making it simpler for customers to go green. In 2022 we announced an ambition to help one million homes and businesses cut their carbon by 2025. Following a productive year investing in new tariffs, acquisitions to offer installation services, offering market leading customer service and paving the way for a smarter, digitised customer experience, and continued growth from Zapmap, today Good Energy has achieved that target - a year ahead of time.

Our goal now is to go further in simplifying our offer, and make it easier than ever to come to Good Energy for everything you need for a greener home or business. We will be looking to bring all of our services under the Good Energy brand, so that it becomes a trusted hallmark for good, genuinely green energy services. With the work we have done in 2023 we are now well on the way.

Nigel Pocklington, CEO

Operating review

Wholesale energy market conditions 

Whilst volatility remained last year, there was a strong bearish trend in the UK gas and power markets in 2023, with the day ahead gas and power contracts losing 48% and 59% respectively. Demand remained relatively subdued, as we witnessed a second consecutive mild winter, with 2023 being confirmed as the world's warmest year on record. LNG supply to Europe improved as the US LNG terminal Freeport returned to operations in March after it had been closed since June 2022 following an explosion. Competition for LNG supply was also limited owing to lower Asian demand due to the lack of extreme weather, and a slower than expected Chinese economic recovery following the end of Covid restrictions. 

The UK power mix saw a shift in 2023, with wind generation increasing to supply 26% of the UK's power requirements, compared to 24% in 2022. There were also higher imports through the interconnectors, increasing from 6% to 14% of the UK power mix, aided by additional interconnector capacity along with a 24% increase in French nuclear output. 

Overall, UK gas consumption was 12% lower, with the biggest reductions seen from industry, along with power generation due to the increase in renewables and imports. Reductions in UK electricity supply volumes were lower at 2%.  

Renewable supply business 

Cash collections 

·      Cash collections through 2023 remained strong, despite significant regulatory pressure around domestic collection, in addition to continued economic pressures around inflation and the cost-of-living crisis.  

·      We continued to see rapid speed to cash from Key Accounts and larger business supplies, further demonstrating our ability to manage large and complex billing portfolios and broker relationships. We also saw significant reductions in SME debt, with aged debt reducing by 25% in the year.  

·      Direct Debit collections remained healthy through the year, with consistent payments made in line with consumption changes. 

Business 

Total business supply meters fell by 27% to 5,592.?The decline is part of our ongoing right-sizing of our business portfolio to align with the energy services strategy. In the same period, business supply volumes only reduced by 15%, reflecting an increase to the average customer on supply from 59MWh (2022) to 67MWh (2023). 

Domestic 

We remain committed to ensuring that we offer a fair priced, transparent 100% renewable electricity proposition.  

Services business

Feed in tariff (FiT) 

FiT administration provides the foundation of our energy services model. Despite the FiT scheme closing to new entrants in March 2019, we continue to administer the scheme for domestic and business customers. 

Customer numbers increased 1.5% to 182,982 (vs 180,300 in 2022). 

Smart meters 

Good Energy has now installed 47,000 meters, and as a result,?58.4% of domestic customer meters are now smart. We made strides in improving the health of our domestic smart meters, which is crucial for enabling our Smart enabled tariffs like Solar Savings, Power Pause and our EV tariff, and the accurate communication of meter readings. 

Solar installations 

Good Energy Group PLC acquired Wessex EcoEnergy in June 2023. Revenue from the business in 2023 was £2.1m.

Heat pump installations 

Revenue from heat pump installations in 2023 was £0.96m, strengthening into the second half of the year as marketing spend increased and buoyed by the enhanced government BUS grant which was introduced in October.

CFO REVIEW

Overview

The Group has delivered solid financial results for 2023 and a holds strong balance sheet to invest in the future of the business.  The performance in 2023 provides a good springboard to move into 2024 and beyond with a more diversified business encompassing both supply and increasing levels of service income.

Financial performance

Profit and loss

Revenue increased 2.4% in the period to £254.7m (2022: £248.7m) driven by increased tariffs reflecting the high commodity cost environment present at the start of 2023.  Cost of sales decreased by 3.8% to £210.5m (2022: £218.8m) with commodity costs ending 2023 materially lower than when the year started.  Both cost of sales and revenue are expected to be significantly lower in 2024 reflecting lower wholesale costs and associated tariffs in the supply segment of the business.

Reported gross profit increased 47.9% to £44.2m (2022: £29.9m).  Gross margin increased to 17.4% (2022 12.0%).  The increase reflects a strong H1 2023 when low margins seen in 2022 were recovered as tariffs caught up with the wholesale cost rises seen in 2022. 2024 is expected to see a return to more normalised supply segment margin levels.

Total administration costs increased 32.6% to £37.3m (2022: £28.1m).  This increase relates to a £2m year-on-year growth in expected credit loss provisioning, alongside £4.2m investment supporting the expansion of the services business.  Other factors include a £1.25m contribution to the voluntary redress fund and inflationary pressures experienced by all businesses during 2023.

Net finance income grew from £0.3m to £0.6m reflecting higher interest rates on offer for cash available to be placed on deposit.

Reported profit before tax of £5.7m compares with an underlying PBT of £1.4m in 2022 reflecting recovery of margins in 2023. (2022 PBT was £9.2m but included a one-off revaluation benefit of £7.8m associated with the ZAPMAP business)

2023 tax charge is £2.8m versus 2022 which was a tax charge of £0.6m. 2022 included the impact one-off benefits related to generation business sale.

The reported profit for the period was £2.9m (2022: £8.6m). Whilst underlying business is materially stronger in 2023 the non-repeat of the 2022 increase in value of the investment in Zapmap alongside a higher tax obligation in 2023 drive a lower profit after tax return.

*A profit bridge slide has been included in the Investor presentation, which is available on the Company's website. (https://group.goodenergy.co.uk/home/default.aspx)

Cash flow and cash generation.

There was a net increase in cash of £16.9m, which includes the acquisition of Wessex Eco Energy in June 2023.

Cash and cash equivalents at the end of December 2023 were £41.3m, with a further £5.9m held in security and restricted deposit accounts.  Within the cash and cash equivalents balance are £13.9m of customer credit balances (2022: £4.9m). These balances have grown materially in 2023 as a result of rapid increases and then decreases in wholesale costs and associated tariffs.  These credit balances are expected and planned to fall to a more normal level in 2024 and the company is taking proactive steps to reduce this credit position.

Funding and debt

Our business is debt free on a net basis.

The remaining Good Energy Bonds II amount outstanding including interest is £4.9m split £0.2m short term liabilities and £4.7m within long term liabilities. This is due to an annual redemption request window for bondholders in December of each year.

The Group continues to maintain capital flexibility, balancing operating requirements, investments for growth and payment of dividends. Our business remains mindful of the need to capitalise on strategic business development and investment opportunities. Prudent balance sheet management remains a key priority.

Earnings

Reported basic earnings per share reduced to 17.1p (2022: 55.7p). Whilst underlying business is materially stronger in 2023 the non-repeat of the 2022 increase in value of the investment in Zapmap alongside a higher tax obligation in 2023 drive a lower profit after tax return.

Dividend

Following strong operational performance in 2023, and reflecting our confidence in the ongoing business, the Board recommend a final dividend for 2023 of 2.25p per ordinary share (2022 2.0p).

Good Energy continues to operate a scrip dividend scheme and the payment timetable of the final dividend will be announced in due course.

Expected Credit Loss (ECL)

ECL charge in the year was £5.6m, this is an increase of £1.7m (2022: £3.9m).

The main impact of the year is elevated tariffs. Revenues have significantly increased but this has been partially offset by Government support schemes reducing the impact of higher prices on end customers.

Consolidated Statement of Comprehensive Income (Unaudited)

Consolidated Statement of Financial Position (Unaudited)

As at 31 December 2023

Consolidated Statement of Changes in Equity (Unaudited)

For the year ended 31 December 2023

Consolidated Statement of Cash Flows (Unaudited)

For the year ended 31 December 2023

Notes to the Financial Information (Unaudited)

1.  Basis of Preparation

Good Energy Group PLC is an AIM listed company, incorporated in England and Wales, and domiciled in the United Kingdom, under the Companies Act 2006.

The principal activity of Good Energy Group PLC is that of a holding and management company to the Group. More detailed information on the Group's activities is set out in the Chairman's statement, the Chief Executive's review and the Chief Finance Officer's review.

The unaudited Preliminary Report has been prepared using consistent accounting policies with those of the previous financial year. It does not contain sufficient information to comply with the disclosure requirements of UK-adopted international accounting standards.

The Preliminary Report was approved by the Approvals Committee and the Audit Committee and adopted by the Board of Directors. The Preliminary Report does not constitute statutory financial statements within the meaning of section 434 of the Companies Act 2006 and has not been audited.

On 22 June 2023, the Group acquired the entire share capital of Wessex EcoEnergy Limited, an established UK based solar panel installation business, for consideration of £2.55 million. The results of Wessex EcoEnergy Limited are consolidated within the financial statements.

The accounting policies adopted, other than as documented above, are consistent with those of the annual financial statements for the year ended 31 December 2022, as described in those financial statements.

The Preliminary Report is presented in pounds sterling because that is the currency of the primary economic environment in which the Group operates.

The Preliminary Report will be announced to all shareholders on the London Stock Exchange and published on the Group's website on 26 March 2024. Copies will be available to members of the public upon application to the Company Secretary at Good Energy, Monkton Park Offices, Monkton Park, Chippenham, Wiltshire, United Kingdom, SN15 1GH.

2. Segmental Analysis

The chief operating decision-maker has been identified as the Board of Directors (the 'Board'). The Board reviews the Group's internal reporting in order to assess performance and allocate resources. Management has determined the operating segments based on these reports. The Board considers the business from a business class perspective, with each of the main trading subsidiaries accounting for each of the business classes. The main segments are:

·    Supply companies (including electricity supply, FiT administration and gas supply);

·    Energy as a service (including Good Energy Works, Wessex EcoEnergy and Zapmap)

·    Holding companies, being the activity of Good Energy Group PLC.

The Board assesses the performance of the operating segments based primarily on summary financial information, extracts of which are reproduced below. An analysis of profit and loss, assets and liabilities and additions to non-current assets, by class of business, with a reconciliation of segmental analysis to reported results follows:

Segmental analysis: 31 December 2023 (Unaudited)

All turnover arose within the United Kingdom.

Segmental analysis: 31 December 2022

All turnover arose within the United Kingdom.

3. Finance Income and Finance Costs

4. Earnings per Share

Basic

Basic earnings per share is calculated by dividing the profit attributable to owners of the Company by the weighted average number of ordinary shares during the year. At the year end, there were no (2022: 79,924) shares held by Clarke Willmott Trust Corporation Limited in trust for the Good Energy Group Employee Benefit Trust. The Employee Benefit Trust was wound up during 2023.

Diluted

Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares to assume conversion of all potentially dilutive ordinary shares. Potentially dilutive ordinary shares arise from awards made under the Group's share-based incentive plans.

Where the vesting of these awards is contingent on satisfying a service or performance condition, the number of potentially dilutive ordinary shares is calculated based on the status of the condition at the end of the period.

Potentially dilutive ordinary shares are dilutive only when the average market price of the Company's ordinary shares during the period exceeds their exercise price (options) or issue price (other awards). The greater any such excess, the greater the dilutive effect.

The average market price of the Company's ordinary shares during the year was 209p (2022: 242p).

4. Earnings per Share (continued)

The dilutive effect of share-based incentives was 169,580 shares (2022: 10,497 shares). The dilutive effect of share-based incentives for continuing operations was 169,580 shares (2022: 10,497 shares).

5. Borrowings

The current portion of the bond repayment represents the interest accrued and the amount of principal repayments requested prior to the year end. The latest redemption request deadline was in December 2023, for repayment of the remaining bond in June 2024.

The bank and other borrowings are made up of interest accrued and the amount of principal repayments under a Revolving Credit Facility.

6. Cash Generated from Operations

For the year ended 31 December 2023