INNOVATIVE Energy Group Limited (IEG), formerly Ciboney Group Limited, has reported a turnaround in its financial performance for the second quarter ended November 30, 2024, posting a consolidated profit of $12.3 million compared to a $3.8-million loss in the same period of 2023. This improvement follows the acquisition of its subsidiary, Innovative Energy Company Limited (IECL), which contributed to the group’s revenues and profits through its renewable energy operations.

The acquisition which cost the company US$17.7 million ($2.8 billion) involves the issuance of debt instruments and additional equity in IEG. IECL is now a wholly owned subsidiary of IEG.

With that now out of the way, the company is looking forward to what Nigel Davy, executive chairman, says is an agressive growth push in the renewable energy space.

“We intend to acquire several other companies in the future,” Davy said. Discussions are already underway, but Davy declined to provide further details, citing the early stage of the talks. He however indicated that the acquisitions will be done in Jamaica and the region as the solar energy sector consolidates with smaller players absorbed by larger entities.

To fund these acquisitions and other growth initiatives, IEG plans to raise an initial US$5 million in capital through the issuance of an additional public offer of shares or private placements. “We’re looking to bring some of these projects or acquisitions to book within the next six months,” Davy said.

He added that IEG is positioning itself as a leader in Jamaica’s renewable energy market, with plans to bid on upcoming large-scale projects issued by Jamaica Public Service Company and Generation Procurement Entity. Davy said with the country set to add about 500 megawatts of solar capacity and 200 megawatt-hours of battery energy storage over the next five years, he is positioning IEG at the front of the queue to benefit.

“We have several major contracts being executed now, and we have a few more to be executed in the near term. So that entity has booked as of this point in time close to maybe US$15 million of active contracts being executed, and we’re actively seeking new ones,” Davy added.

IECL has been executing several renewable energy projects across Jamaica, including solar installations at Norman Manley International Airport and Sangster International Airport. The project at Sangster International Airport was completed at a cost of US$2.5 million last year and a $7.8-million project for the National Irrigation Commission that is scheduled to be completed this summer. A new solar energy project is currently being executed by IECL at Sangster International currently for US$7.5 million which could expand to being a US$10 million project.

The company has also signed an agreement with Huawei International to market digital power products, which is expected to generate over US$50 million in revenue over the next five years.

IEG plans to participate aggressively in upcoming renewable energy project bids across Jamaica and the Caribbean. In addition to bidding on new projects, IEG is exploring mergers and acquisitions as part of its growth strategy.

IEG’s future prospects appear bright, with Davy forecasting “substantial revenues” in the current financial year.

IEG’s consolidated financials for Q2 2024 reflect just one month of IECL’s performance following its acquisition. Despite this short timeframe, IEG recorded revenues of $39.7 million and gross profits of $31.6 million for the quarter.

“So we made our acquisition, and of course now we have consolidated the financials for both companies, hence what we saw last Friday when we published the consolidated financial statements for both entities. And those numbers that you looked at is a reflection of what happened during the month of November only. So the next unaudited financial statements will be coming out in mid-March for Q3. So you will see, you will get a better feel or appreciation for what IEC has been doing. This particular financial year, which ends in May of this year, you should see substantial revenues on the consolidated financial statements. I don’t want to spell out the actual numbers at this juncture, but close to a billion or more in revenues,” he said.