Iseteenindus

Eesti Energia Group Q3 results for FY2011

28.10.2011
Consolidated unaudited revenues of Eesti Energia for Q3 FY 2011 amounted to 191 million euros (+15% y-o-y), operating profit to 36 million euros (+62% y-o-y) and net profit to 38 million euros (+163% y-o-y). Consolidated unaudited 9-month revenues amounted to 634 million euros (+12% y-o-y), operating profit to 118 million euros (-2% y-o-y) and net profit to 101 million euros (-13% y-o-y)

Key financial indicators

The Group's revenue growth was supported by the sale of electricity at non-regulated prices (+10 million euros), sales of network services (+4 million euros) and sales of liquid fuels (+3 million euros).

The Group's EBITDA amounted to 60.0 million euros (+32.8% y-o-y), while operating profit increased 61.5% to 36.2 million euros in Q3 2011.

Group´s results were influenced by improved operating profit of Electricity and Heat Generation Division (14 million euros, +569.3% y-o-y). The increase was mainly due to higher electricity sales prices and lower input costs. Retail Division's operating profit (10 million euros, -7.2% y-o-y) was impacted by higher fixed expenses and lower margins in electricity market. At the same time, operating profit of Distribution Network subsidiary increased by 19.1% y-o-y increase to 10 million euros due to increase in network service fees in the third quarter. The operating profit of Fuels division (12 million euros, +26.2% y-o-y) increased due to higher oil margins, which was partly offset by lower profitability of the mining division.

Group´s operating cash flow amounted to 52 million euros (+72% y-o-y). Main reasons behind the increase is higher EBITDA (+15 million euros positive cash flow impact) and CO2 prepayments (-12 million euros negative cash flow impact). In addition positive impact of 29 million euros originated from corporate income tax payment, which was paid in Q3 in 2010 compared to Q2 in 2011.

Key performance indicators

Electricity sales amounted to 2.4 TWh, down 0.7% y-o-y, of which electricity sold at regulated prices was 1.1 TWh (+0.4% compared to Q3 2010).

Electricity sales at non-regulated prices amounted to 1.3 TWh in Q3 2011, which is 1.5% less than a year ago. In Estonia, Eesti Energia's average share in the open electricity market was 71% in the Q3 2011. In Latvia and Lithuania the average market share was respectively around 18 and 8 percent during the third quarter of 2011.

Total electricity generation in Q3 2011 reached 2.4 TWh, up 1.3% y-o-y. Shale oil sales decreased 2.6 percent to 35 thousand tonnes. Oil shale production amounted to 4.4 million tonnes, which represents 9.5 percent increase y-o-y.

Capital expenditure

In Q3 2011 Eesti Energia invested 122 million euros, up 154% y-o-y.

Total capital expenditure in Retail division amounted to 21 million euros mainly to new network connections and improvement of distribution network's reliability.

Eesti Energia invested a total of 66 million euros to Electricity and Heat Generation division including the construction of Narva windpark (35 million euros), construction of new oil-shale fired power plant (8 million euros) and installation of desulphurization equipment to Narva power plant (7 million euros).

Fuels division invested 31 million including 19 million euros to Enefit-280 oil plant and 6 million to the renovation and acquisition of new mining equipment.

Outlook

Full year 2011 revenues for the Group are expected to increase compared to 2010 (796 million euros) due to strong oil prices, higher electricity prices and volumes and new network fees from 1 August 2011

Full year 2011 operating profit is expected to remain approximately at the same level as in FY10 (149 million euros). The main factors impacting FY11 operating profit include higher shale oil and electricity margins (positive impact) as well as higher maintenance and fixed expenses (negative impact).

More information on the Q3 2011 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
Mobile + 372 5668 1568
veiko.raim@energia.ee