We have now completed the first month of 2019 and are off to a good start. The total net asset value as per 1 January 2018 amounted to 59 MSEK and has increased by 124% to 138 MSEK as per 31 December 2018. The net asset value per share has during the full year 2018 increased from 105 SEK per share to 124 SEK per share, an increase of 18%.
During 2018 we have invested in all three of the portfolio companies and mainly in Exeger to balance our investments more evenly. We now have better balance in the portfolio were Meva Energy accounts for around 20% of the portfolio, Exeger and QFS account for slightly below 40% each and the remaining 3% is held in cash.
The positive development of net asset value per share has mainly been related to a steady increase in the transaction prices in Exeger and an increase in value for Meva Energy following the pre-agreement signed in April/May 2018 for the first commercial sale of a plant. This is good progress, but we still believe that most of the valuation upside remains for all three portfolio companies.
- Share price up for Exeger following higher transaction prices
- Essity discussion continues in a promising way
- QFS is moving closer to signing the first agreement
We are hopeful for an agreement during the first quarter 2019 and feel that both parties have a constructive approach to the remaining details in the agreement. Essity is a large industrial company and would be an important first customer for Meva Energy.
Meva Energy is also at this time engaging in many discussions with other potential customers as well as potential partners. With regard to the latter, there is clear interest from traditional gas distribution companies to participate in the biogas market, which is believed to increase in the future.
A lot of work is put into the legal framework between buyers and sellers as well as aligning the banking and payment structure between buyer and seller. We are now moving closer to execution of contracts and although there are details remaining the most important factors are in place, willing buyers and sellers at specific price levels. The intention is to execute a couple of spot transactions of refined products such as diesel, gasoline and jet fuel and thereafter move over to secure 12 months term deals. In parallel to these deals we are tendering crude oil quotes to larger Chinese buyers.
At Exeger several processes takes place in parallel. Most importantly, commercial negotiations are in the works but needs to be held confidential at this time. Exeger recently qualified for an ISO 9001 certificate and has also launched a robotization programme for the factory in order to increase efficiency and competitiveness. Finally, Exeger has made international recruitments of senior executives, who will focus on sales and production development.
2019 will be an exciting year for Molindo Energy. We are positive about the progress and direction of the portfolio companies and we will continue to support them.