Novera and Macquarie Bank Ltd joined forces in December last year to create a company to acquire and operate Novera's renewable energy assets in Britain.

The new company, Novera Macquarie Renewable Energy Ltd (NMRE), started operating that month with a portfolio of wind farm, hydro power generators and landfill gas-fired (LFG) power station assets.

Novera reported a 2004 net profit of $934,000, well up from a 2003 net loss of $3.4 million.

The profit comprised an operating loss of $2.4m, a $1.45m write off, an ‘equity accounted’ loss in the joint venture for December 2004 of $0.5m ,and a $5.3m gain from the sale of Novera’s energy assets to the NMRE joint venture.

Novera also sold a major under-performing asset, the Arpley facility, at its book value of $9.2m. Total revenue for the year, including these activities, was $99.7m.

Novera chairman Don Stammer said the company's materially improved result reflected improved operations and substantial strategic initiatives culminating from the establishment of NMRE.

"Over 2005 and beyond, cash distributions to the company from the NMRE joint venture will greatly improve Novera's cash flow," Stammer said.

Initially NMRE will be generating both large cash flows and substantial accounting losses, according to Stammer.

"At the same time it is generating substantial cash flows, the joint venture will be providing for the accelerated depreciation of assets it employs to produce renewable energy," he said.

NMRE has an initial portfolio of 128 megawatts of which 107 MW is currently operational. The NMRE joint venture was concluded with the acquisition of Novera's Mynydd Clogau wind farm project in Wales.

Novera shares closed yesterday up 0.5 cents to 26.5 cents.