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ACWA Power Reports 44% Surge in Q1 Profit to $113.8 Million

A wind turbine at the Suez Energy Project. (ACWA Power)
A wind turbine at the Suez Energy Project. (ACWA Power)
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ACWA Power Reports 44% Surge in Q1 Profit to $113.8 Million

A wind turbine at the Suez Energy Project. (ACWA Power)
A wind turbine at the Suez Energy Project. (ACWA Power)

Saudi energy and water developer ACWA Power reported a 44% year-on-year increase in net profit for the first quarter of 2025, reaching SAR 427.15 million ($113.8 million), according to a disclosure filed with the Saudi Stock Exchange (Tadawul).

The company attributed the strong performance primarily to higher total revenues, an increase in other operating income before impairment and other charges, a reduction in impairment expenses, and a rise in deferred tax balances. These gains were partially offset by increased costs in project development, general and administrative expenses, and financing charges.

ACWA Power’s revenue rose 57% in the quarter, reaching SAR 1.97 billion ($525.2 million), supported by growth across development and construction management services, operation and maintenance contracts, and electricity sales.

In a letter to investors, CEO Marco Arcelli emphasized that the company maintained strong momentum in developing new projects across all sectors during the first quarter.

These initiatives not only lay the foundation for stable future revenues and cash flows, but also contribute to earnings from procurement and construction management, reinforcing the company’s commitment to financial and operational growth, he noted.

Arcelli expressed optimism about the company’s long-term outlook, highlighting ongoing efforts to strengthen project development pipelines, improve procurement strategies, and streamline construction execution.

ACWA Power is building a solid platform for consistent and sustainable growth while remaining focused on delivering its strategic objectives, he stressed.

Among the company’s most significant recent projects are several in renewable energy and water. In the solar sector, ACWA Power is developing the Al-Muwayh solar power plant in Saudi Arabia with a capacity of 2,000 megawatts and an investment of approximately SAR 35 million. The plant is scheduled to begin operations under a long-term power purchase agreement starting in 2027.

The company is also working on the Al-Khushaybi solar plant, with a capacity of 35 megawatts.

In wind energy, ACWA Power is constructing the Bash wind farm in Uzbekistan, a 500-megawatt project expected to be operational in the first quarter of 2025. Another wind project in collaboration with Uzbekistan’s national energy company will have a capacity of 65 megawatts and is also scheduled for completion in 2025.

In the water sector, ACWA Power owns a 40% stake in the Taweelah desalination plant in the United Arab Emirates, one of the largest facilities of its kind with a daily capacity of 3 million cubic meters. The company also holds a 35% share in the Sudair solar project in Saudi Arabia, which will generate 1,500 megawatts of electricity.

ACWA Power has expanded its international footprint with recent acquisitions, including an 85% stake in Yanghe New Energy Technology in China. The company also acquired strategic assets in Egypt and Kuwait and is actively entering new markets while expanding its presence in existing ones.

The company continues to prioritize innovation and R&D, particularly in solar and wind energy, green hydrogen, and energy storage. It is advancing new projects, increasing energy sales, and strengthening its global presence through strategic partnerships, including collaborations with Italian firms and others in Africa and East Asia.

ACWA Power has also launched a new research and development center in Shanghai as part of its international growth strategy.

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Saudi Bonds: A Safe Haven in Emerging Markets

Riyadh (SPA)
Riyadh (SPA)
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Saudi Bonds: A Safe Haven in Emerging Markets

Riyadh (SPA)
Riyadh (SPA)

As global investors remain cautious about debt in emerging economies, Saudi Arabia is increasingly seen as a stable and attractive investment destination. This confidence stems from its strong financial foundation and ambitious economic transformation plans.

Karine Kheirallah, Head of Investment Strategy and Research for Europe, the Middle East, and Africa at State Street Global Advisors, one of the world’s largest asset managers, highlighted Saudi Arabia’s compelling macroeconomic story. She noted that while many countries struggle with high debt and rising servicing costs, Saudi Arabia maintains a relatively low debt-to-GDP ratio of 29.9% as of December 2024. Even with planned increases to support Vision 2030 investments, it is expected to remain well below global averages.

This fiscal discipline positions Saudi Arabia as a reliable sovereign bond issuer within emerging markets. Kheirallah expects the Kingdom to see steady economic growth in the coming years, led by structural reforms and non-oil sector investments. Though growth may not match the pace of some emerging markets, it is likely to outperform many advanced economies, making Saudi bonds appealing for investors seeking long-term value and stability.

In the first quarter of 2025, Saudi Arabia’s economy grew by 3.4% year-on-year, driven primarily by a 4.9% expansion in non-oil sectors, which contributed significantly to real GDP growth.

Vision 2030 plays a vital role in developing Saudi Arabia’s fixed-income market. Kheirallah explained that to finance major projects such as NEOM, both the government and the Public Investment Fund have expanded bond and sukuk issuances, including green financing. This has led to a more mature yield curve and improved price discovery across maturities.

The inclusion of Saudi dollar-denominated bonds in J.P. Morgan’s Emerging Markets Index in 2019 was a turning point, signaling global investor confidence. This move helped lay the groundwork for a more robust and sustainable debt market.

Saudi bonds also benefit from strong credit ratings. Moody’s upgraded Saudi Arabia to A1 in November 2024, and S&P raised its rating to A+ in March 2025. These reflect the country’s financial strength and effective reforms.

While public debt is rising, Kheirallah emphasized it remains manageable. However, sustaining fiscal health will depend on continued diversification and growing non-oil revenues. Maintaining high credit ratings, she stressed, will require ongoing financial discipline and successful reform implementation.