Mast Energy. Regulatory News (MAST)

Mast Energy Developments PLC

(Incorporated in England and Wales)

(Registration Number: 12886458)

Share code on the LSE: MAST

ISIN: GB00BMBSCV12

("MED" or "the Company")

19 October 2022

Mast Energy Developments PLC ("MED" or "the Company")

 Pyebridge Trading Update

Mast Energy Developments PLC, the UK-based multi-asset owner and operator in the rapidly growing Reserve Power market is pleased to announce an update with regards to its current flagship producing asset, the 9 MW Pyebridge Synchronous Gas-powered Flexible Generation Facility (the "Site" or "Pyebridge") further to its previous update (see RNS dated 5 July 2022). An overview of the key highlights with regards to the Site's latest available actual performance both operationally and economically is provided below.

Pyebridge Trading Update

The Pyebridge Site generated the following actual performance figures, based on the latest available trading data.

For the 6-month period March to August 2022 (the "Period"):

· Electricity Generation Sales Revenue for the Period - c. £854,000;

· Total Electricity Generation Output for the Period - c. 2,280 MWh; and

· Average Electricity Generation Sales Price achieved per MWh sold for the Period - c. £370.

For August 2022 alone (the "Month"):

· Electricity Generation Sales Revenue for the Month - c. £314,000;

· Total Electricity Generation Output for the Month - c. 1,420 MWh;

· Average Electricity Generation Sales Price achieved per MWh sold for the Month - c. £619; and

· Gross Profit Margin achieved of c. 32%.

There is a very clear indication that the rigorous operational and commercial optimisations implemented on the Site earlier this year (refer to RNS dated 5 July 2022 for more details in this regard) have started to yield the desired results. In fact, the Site's actual performance, especially based on the latest actual trading data available for the month of August 2022, has exceeded expectations across the board. Most notably, the key performance metrics listed above are far in excess of expectations. Considering the Site's actual performance, the past six months have also been during the summer period which have historically typically seen lesser demand for Reserve Power generation, we expect the upcoming winter period to follow historic trends with an increase in demand for Reserve Power generation and consequently a continuing positive upward trend in the Site's economic performance.

The average electricity generation sales price per MWh achieved during the 6-month period March to August 2022 of c. £370 is around 5x higher than the price at the time of MED's IPO in April 2021 (i.e. around £66 at that time). The latest electricity generation sales price per MWh achieved during August 2022 of c. £619 is almost 10x (or 1,000%) higher compared to the price at IPO. Although the associated generation gas cost (which makes up the bulk of a site's cost of sales) also increased during this time, we are seeing on average a clear positive net variance that enhances the Site's profitability.

Based on the Site's latest actual performance results for August 2022, and assuming that the Site's performance and the market variables remain at or around those levels, it is expected that Pyebridge will generate total revenues for 2022 in the range of £1.8m to £2.1m with a gross profit margin of around 30%. The foregoing expected revenue is around 2x (or 200%) higher than initially modelled at the time of the acquisition of Pyebridge.

Furthermore, looking forward it is expected that once MED's current total combined generation portfolio of c. 28.3 MW are fully constructed and in steady state production, that the combined portfolio will generate total annual revenues in the range of £10m to £12m. The foregoing forecast is based on the MED portfolio's base case financial modelling independently compiled by its energy markets data consultant, EnAppSys.

The revenue and profit margin guidance is predicated on the progression of projects' meeting anticipated timelines, that sites in production are able to meet performance targets and, that key market variables most notably demand for Reserve Power generation and electricity generation sales prices do not materially change. The Company has taken great care with regards to its financial performance guidance, but it must be noted that historic performance is not necessarily indicative of future performance and all forecasts stated above remain subject to change until such time as actual production figures are available, following a suitable period of steady state operation.

Pieter Krügel, MED CEO, commented: "We are very pleased with the latest performance data coming out of Pyebridge, which have significantly exceeded expectations and prove that our rigorous optimisation process implemented on the Site earlier this year has been worthwhile. Looking forward, we expect the UK energy market to remain buoyant at our around current levels especially going into the winter period which have historically typically seen increased demand for generation and higher prices. Now that Pyebridge is profitable, we are focussing on fast tracking the development of our other four sites to get our current full portfolio of c. 30 MW into production as fast as possible.

We look forward to providing the market with further updates in due course as we progress."

ENDS

This announcement contains inside information for the purposes of the UK version of the Market Abuse Regulation (EU No. 596/2014) as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018 ("UK MAR"). Upon the publication of this announcement, this inside information is now considered to be in the public domain.

For further information please visit www.med.energy or contact: