Iseteenindus

Eesti Energia Group unaudited results for Q1 2013

30.04.2013
Consolidated revenues of Eesti Energia for Q1 2013 amounted to 289 million euros (+23% y-o-y), EBITDA to 73 million euros (-11% y-o-y) and net profit to 25 million euros (-56% y-o-y).

Financial results

The Group’s revenues were supported by the higher sales of all main products; however, the main impact still originated from higher electricity revenues (+60 million euros). Both the sales volume as well as average sales price increased considerably, the Group sold electricity on average for 45.3 €/MWh (+22% y-o-y) in Q1 2013.

Group’s EBITDA amounted to 73.1 million euros in Q1 2013, down 11.2% y-o-y (-9.3 million euros). Change in Group´s profitability is mainly influenced by one-off items (sales of telecommunications subsidiary in Q1 2012 and fixed assets in Q1 2013), which in combination resulted in 10.7 million euros higher EBITDA contribution in Q1 2012. Higher profitability of distribution network (+1.7 million euros) and sales of electricity (+1 million euros) had a positive impact on Group´s EBITDA in Q1 2013. Electricity sales volume increase was the main positive influence in Q1 2013, adding 21.1 million euros to Group EBITDA. Lower electricity sales margin contributed negatively to the results, reducing Group EBITDA by 11.3 million euros.

Group´s operating cash flow amounted to 68.4 million euros (+15.9% y-o-y). Lower inventories and trade receivables were the main reason behind the improved cash flow.

Key performance indicators

Electricity sales amounted to 3.5 TWh (+37.4% year-on-year), all sales were conducted at market prices after final step of Estonian retail power market deregulation on 1st of January 2013.

Sales to retail customers in the Baltic market amounted to 1.9 TWh in Q1 2013, which is 14% less than a year ago (if 2012 sales in Estonian regulated market are also considered). In Estonia, Eesti Energia’s average share in the electricity market was around 71% in Q1 2013. In Latvia and Lithuania the market share was around 13% and 8% of the total electricity market, respectively. Group´s average market share in the Baltic market was around 31% in Q1 2013.

In Q1 2013 Eesti Energia sold 1.5 TWh to power exchanges and wholesale companies, which is over 5 times more than a year ago due to favourable power generation margins.

Group distributed 1.9 TWh of electricity in Q1 2013, which was 0.5% less than in the respective period of 2012. Distribution network losses reached 5.9% in Q1 2013 compared to 7.9% in Q1 2012.

Sales of shale oil amounted to 51 thousand tonnes, up 0.6% y-on-y, This was achieved without any material contribution from new Enefit280 oil plant.

Capital expenditure

Eesti Energia capital expenditure in Q1 2013 amounted to 74 million euros, which is 42.4% less than in Q1 2012.

The largest investments were made into new network connections and improvement of network’s reliability (16.3 million euros), new 300 MW CFB power plant (14.4 million euros), construction of Iru waste-to-energy plant (10.3 million euros) and the final payments for Narva Wind Park (4.1 million euros). Maintenance capital expenditure amounted to 12.4 million euros in Q1 2013.

Financing

The Group’s available liquidity as at 31 March 2013 amounted to 557 million euros (liquid assets of 162 million euros, undrawn revolving credit facilities of 300 million euros and 95 million euros investment loan from EIB). Group decided to reduce the undrawn revolving credit facilities in Q1 2013 by 100 million euros due to the sufficiently high liquidity buffer.

As at 31 March 2013, the Group´s main source of debt were Eurobonds due in 2018 and 2020 with combined face value of 600 million euros. Group’s total net debt amounted to 570 million euros, while Net debt/EBITDA ratio was 2.1 and financial leverage 29.7%.

Outlook

Group revenues and EBITDA for 2013 are expected to increase compared to FY2012. While expected oil production from Enefit280 has been reduced due to delays in commissioning, Group power generation capability is forecasted to exceed prior expectations.

Eesti Energia has sold forward 5.6 TWh of power for the remaining 3 quarters of 2013 at the average price of 44.2 €/MWh. Group has also hedged 102 thousand tonnes of shale oil production for the remaining period at the average price of 456 €/tonne. Group´s CO2 emissions exposure for the whole 2013 has been hedged via forward purchases of 11.6 million tonnes at the average price of 8.6 €/tonne.

In 2013 Group´s total capital expenditure is expected to reach 427 million euros, while the committed investments for 2014 and 2015 respectively amount to 335 million euros and 208 million euros. Shareholder has approved 73.5 million of net dividends to be paid by Eesti Energia for the 2012 financial year.

Credit ratings

At the end of Q1 2013, Eesti Energia had a credit rating of BBB+ with stable outlook from Standard & Poor’s and Baa1 with negative outlook from Moody’s. Eesti Energia’s credit ratings are at the investment grade level that allows the Group to access debt capital markets if needed.

More information on the financial results of Eesti Energia Group is available at Eesti Energia homepage.

Veiko Räim
Head of Investor Relations and Treasury
Eesti Energia AS
Tel: +372 715 2884
Mob: + 372 5668 1568
[email protected]