WRAPUP-Renovables, REC post firm H1 results, upbeat on 2010

* European renewables upbeat on 2010

* Cautious on 2011 due to subsidy cuts in core markets

By Jonathan Gleave and Wojciech Moskwa

MADRID/OSLO, July 20 (BestGrowthStock) – Iberdrola Renovables and
Renewable Energy Corp kicked off Europe’s green energy
reporting season on Tuesday with sharp upticks in first-half
earnings and upbeat 2010 forecasts, but neither gave a forecast
for 2011.

Spain’s Renovables (IBR.MC: ), the world’s largest generator
of wind power, reiterated its forecast to grow its core
earnings by 20 percent in 2010, while Norway’s REC (REC.OL: ),
which makes solar power equipment, forecast growth in the
second half, thanks to higher demand.

“Demand is very strong in Germany, and we see growth in
Italy and other markets. We anticipated prices to decline, but
they have been more steady than anticipated,” REC Chief
Executive Ole Enger told a news conference.

After a tough 2009, clean energy firms are expected to post
strong results — with REC and Iberdrola the first big
renewables companies to report for the half — although
valuations have dipped recently due to the fears about weak
medium-term demand and subsidy cuts.

Both companies are facing visibility problems, as their
core markets of Spain and Germany process subsidy cuts for wind
and solar power, with REC saying it is “cautious,” while
Renovables banks on its rapid internationalization.

“In our (2010-2012) investment plan, the Spanish market is
fourth in our priorities … The regulatory outlook does not
make it so attractive,” Iberdrola chairman Ignacio Sanchez
Galan said on a conference call following results.

However while Renovables is confident that growing demand
for wind power in its other core markets of the United States
and the United Kingdom will support its business plan to 2012,
REC was more cautious on the global outlook for solar power.

“One has to be cautious about 2011, especially about the
first half of 2011. We prepare for a more imbalanced market in
2011, with more supply than demand — so we will get back to a
situation where there will be pressure on prices,” Enger said.

REC more than doubled its core earnings in the first half
to NOK 455 million [ID:nLDE66J03J], while Renovables’ core
earnings just missed forecasts but still surged 21.5 percent to
706.7 million euros ($913.1 million) [ID:nLDE66J1RG].

Stock Today

($1=6.284 Norwegian Crown)
($1=.7739 Euro)
(With reporting by Wojciech Moskwa, Gwladys Fouche, Terje
Solsvik and Jonathan Gleave, editing by Gerald E. McCormick)

WRAPUP-Renovables, REC post firm H1 results, upbeat on 2010