Ellomay Capital Reports Results for the Three and 6 Months Ended June 30, 2023.

TEL-AVIV, Israel: Ellomay Capital Ltd. (NYSE American: ELLO) (TASE: ELLO) ("Ellomay" or the "Company"), a renewable energy and power generator and developer of renewable energy and power projects in Europe, USA and Israel, today reported unaudited financial results for the three and six month periods ended June 30, 2023.

Financial Highlights

Revenues were approximately EUR25.5 million for the six months ended June 30, 2023, compared to approximately EUR29.2 million for the six months ended June 30, 2022. This decrease mainly results from the decrease in electricity prices in Spain and from a curtailment of the electricity supply from the Company's facilities to the grid during June 2023 due to maintenance and upgrade work on the main transmission line between Spain and Portugal, which caused a decrease in revenues of approximately EUR1 million. The Company subsequently implemented a solution aimed at minimizing the impact of future similar curtailments. The decrease in revenues was partially offset by an increase in revenues from the Company's biogas plants in the Netherlands, resulting mainly from increased production and an increase in the 2023 gas price, and from the connection to the grid of Ellomay Solar (a 28 MW photovoltaic plant in Spain) during June 2022, upon which the Company commenced recognition of revenues.

Operating expenses were approximately EUR12 million for the six months ended June 30, 2023, compared to approximately EUR13.1 million for the six months ended June 30, 2022. The decrease in operating expenses mainly results from a decrease in payments under the Spanish RDL 17/2022, caused by a reduction in the electricity market price. RDL 17/2022 established the reduction of returns on the electricity generating activity of Spanish production facilities that do not emit greenhouse gases, accomplished through payments of a portion of the revenues by the production facilities to the Spanish government. As a result of the decrease in the electricity market price in Spain during the first half of 2023, the payments under RDL 17/2022 were lower during this period compared to the same period last year. This decrease in operating expenses was partially offset by increased operating expenses in connection with the Company's biogas operations in the Netherlands caused by the use of higher quality raw materials due to lower availability of cheaper raw materials, and from the connection to the grid of Ellomay Solar during June 2022, upon which the Company commenced recognition of expenses. Depreciation expenses were approximately EUR8.1 million for the six months ended June 30, 2023, compared to approximately EUR8 million for the six months ended June 30, 2022.

Project development costs were approximately EUR2.2 million for the six months ended June 30, 2023, compared to approximately EUR1.6 million for the six months ended June 30, 2022. The increase in project development costs is mainly due to the increase in development activities in connection with photovoltaic projects in Israel and USA.

General and administrative expenses were approximately EUR2.9 million for the six months ended June 30, 2023, compared to approximately EUR3.3 million for the six months ended June 30, 2022. The decrease in general and administrative expenses is mostly due to a decrease in D&O liability insurance costs and bonuses paid to employees in 2022.

Share of profits of equity accounted investee, after elimination of intercompany transactions, was approximately EUR1.5 million for the six months ended June 30, 2023, compared to share of loss of equity accounted investee of approximately EUR0.6 million for the six months ended June 30, 2022. The increase in share of profits of equity accounted investee was mainly due to the increase in revenues of Dorad Energy Ltd. ("Dorad") due to higher quantities produced and a higher electricity tariff in Israel, partially offset by an increase in operating expenses in connection with the increased production and higher tariff.

Financing income, net was approximately EUR1.6 million for the six months ended June 30, 2023, compared to financing expenses, net of approximately EUR2.2 million for the six months ended June 30, 2022. The change was mainly attributable to income resulting from exchange rate differences amounting to approximately EUR6.9 million in the six months ended June 30, 2023, mainly in connection with the New Israeli Shekel ("NIS") cash and cash equivalents and the Company's NIS denominated debentures, compared to income in the amount of approximately EUR2.6 million for the...