Riga, 2016-05-31 15:00 CEST (GLOBE NEWSWIRE) -- In the first quarter of 2016, Latvenergo Group has successfully maintained the leading electricity supplier position in the Baltics. The number of business customers in the neighbouring countries has increased by more than 1,700 customers, compared to the first quarter of the previous year. The retail electricity supply outside Latvia has constituted in total 646 GWh (gigawatt-hours), which is approximately one third of the total retail electricity supply – 2,144 GWh (in the first quarter of 2015 – 2,132 GWh).
In the first quarter of 2016, Latvenergo Group power plants have generated 1,236 GWh of electricity and 1,173 GWh of thermal energy. The amount of generated electricity is increased by 20%, compared to the respective period in the previous year. The amount of electricity generated by Riga combined heat and power plants (Riga CHPPs) has increased significantly, being in the first quarter of 2016 by more than two times higher than in the first quarter of the previous year and reaching 620 GWh. Favourable conditions for power generation at Riga CHPPs were fostered by the average price decline of the natural gas by 24%, compared to the respective period in the previous year. The operative and efficient operation of Riga CHPPs ensured for electricity consumption in situations of limited import from abroad, thus precluding electricity price increase risk. Whereas significantly lower water inflow in Daugava determined the decrease by 19% compared to first quarter previous year in the amount of electricity generated by Daugava hydropower plants (Daugava HPPs), which constituted 601 GWh in the first quarter of 2016.
In the first three months of 2016, Latvenergo Group revenue constitutes 263.5 million euros and profit – 38.6 million euros (in the first three months of 2015 – 259.5 million euros and 39.3 million euros respectively). The profit was mainly positively influenced by lower natural gas price, whereas negatively – by the decrease in the amount of electricity generated by Daugava HPPs. In the first quarter of 2016, the EBITDA margin has improved to 33%, whereas in the respective period of the previous year it constituted 26%.
The total amount of investment in the first three months of 2016 constitutes 34.7 million euros, which is by 40% more than in the respective period of 2015. Nearly 70% of the total investment was made into network assets. A substantial part of investment was made in environmentally friendly and environmental development projects – in the first three months of 2016, 8.4 million euros were invested in the reconstruction of Daugava HPPs hydropower units. The ambitious project, which involves gradual overhaul of hydropower units, is scheduled to be completed until 2022, with the total reconstruction costs exceeding 200 million euros. As of 31 March 2016, the completed workload within the contract reached 59.9 million euros. After completion of reconstruction works, the total capacity and amount of electricity generated by Daugava HPPs will increase, ensuring operation of hydropower units for further 40 years.
In February 2016, the international rating agency Moody’s Investors Service reconfirmed the credit rating of Latvenergo AS, determining it Baa2 with a stable future outlook.
After the end of the reporting period, on 14 April, 2016, Latvenergo AS issued additional green bonds in the amount of 25 million euros, thereby completing the second bond offering programme in the amount of 100 million euros. The total amount of bonds represents more than 1/5 of the total amount of borrowings.
Next interim statements of Latvenergo Group of 2016 will be published on 31 August and 30 November.
[1] EBITDA – earnings before interest, corporate income tax, share of profit or loss of associated companies, depreciation and amortisation, and impairment of intangible and fixed assets
Key Performance Indicators
Operational Figures
Q1 2016 | Q1 2015 | ||
Retail electricity supply | GWh | 2,144 | 2,132 |
Electricity generation | GWh | 1,236 | 1,027 |
Thermal energy supply | GWh | 1,131 | 990 |
Number of employees | 4,181 | 4,142 | |
Moody's credit rating | Baa2 (stable) | Baa2 (stable) |
Financial Figures
Q1 2016 | Q1 2015 | ||
Revenue | MEUR | 263.5 | 259.5 |
EBITDA 1) | MEUR | 100.1 | 94.8 |
Net profit | MEUR | 38.6 | 39.3 |
Assets | MEUR | 3,607.5 | 3,526.8 |
Equity | MEUR | 2,133.4 | 2,059.4 |
Net debt2) | MEUR | 657.7 | 688.6 |
Investments | MEUR | 34.7 | 24.8 |
Financial Ratios
Q1 2016 | Q1 2015 | ||
Net debt /EBITDA 3) | 2.1 | 2.8 | |
EBITDA margin 4) | 33% | 26% | |
Capital ratio 5) | 59% | 58% |
1) EBITDA: earnings before interest, corporate income tax, share of profit or loss of associates, depreciation and amortisation, and impairment of intangible and fixed assets
2) Net debt: borrowings at the end of the period minus cash and cash equivalents at the end of the period
3) Net debt / EBITDA: net debt to EBITDA ratio (12-months rolling)
4) EBITDA margin: EBITDA / revenue (12-months rolling)
5) Capital ratio: total equity / total assets
Consolidated Statement of Profit or Loss*
For the 3 months ended 31 March 2016
01/01–31/03/2016 | 01/01–31/03/2015 | |
EUR'000 | EUR'000 | |
Revenue | 263,533 | 259,506 |
Other income | 1,566 | 1,199 |
Raw materials and consumables used | (125,182) | (127,615) |
Personnel expenses | (24,456) | (22,578) |
Depreciation, amortisation and impairment of property, plant and equipment | (52,459) | (43,702) |
Other operating expenses | (15,315) | (15,698) |
Operating profit | 47,687 | 51,112 |
Finance income | 654 | 694 |
Finance costs | (3,756) | (4,959) |
Profit before tax | 44,585 | 46,847 |
Income tax | (6,023) | (7,591) |
Profit for the period | 38,562 | 39,256 |
Consolidated Statement of Financial Position*
31/03/2016 | 31/12/2015 | |
EUR'000 | EUR'000 | |
ASSETS | ||
Non–current assets | ||
Intangible assets and property, plant and equipment | 3,072,843 | 3,090,661 |
Investment property | 739 | 696 |
Non–current financial investments | 41 | 41 |
Investments in held–to–maturity financial assets | 17,071 | 20,609 |
Other non–current receivables | 1,711 | 1,712 |
Total non–current assets | 3,092,405 | 3,113,719 |
Current assets | ||
Inventories | 23,409 | 24,791 |
Trade receivables and other receivables | 304,358 | 266,460 |
Investments in held-to-maturity financial assets | 11,382 | 7,859 |
Cash and cash equivalents | 175,979 | 104,543 |
Total current assets | 515,128 | 403,653 |
TOTAL ASSETS | 3,607,533 | 3,517,372 |
EQUITY | ||
Share capital | 1,288,531 | 1,288,531 |
Reserves | 667,504 | 669,596 |
Retained earnings | 169,345 | 131,662 |
Equity attributable to equity holders of the Parent Company | 2,125,380 | 2,089,789 |
Non–controlling interests | 7,970 | 6,913 |
Total equity | 2,133,350 | 2,096,702 |
LIABILITIES | ||
Non–current liabilities | ||
Borrowings | 749,416 | 714,291 |
Deferred income tax liabilities | 272,576 | 273,987 |
Provisions | 16,197 | 15,984 |
Derivative financial instruments | 10,539 | 8,291 |
Other liabilities and deferred income | 198,647 | 196,386 |
Total non–current liabilities | 1,247,375 | 1,208,939 |
Current liabilities | ||
Trade and other payables | 132,243 | 121,256 |
Borrowings | 84,235 | 83,192 |
Derivative financial instruments | 10,330 | 7,283 |
Total current liabilities | 226,808 | 211,731 |
Total liabilities | 1,474,183 | 1,420,670 |
TOTAL EQUITY AND LIABILITIES | 3,607,533 | 3,517,372 |
* - Unaudited Interim Condensed Consolidated Financial Statements. Prepared in accordance with the IFRS as adopted by the EU
Additional information:
Jānis Irbe
Group Treasurer
Phone: +371 67 728 239
E-mail: investor.relations@latvenergo.lv
About Latvenergo
Latvenergo Group is a pan-Baltic energy company, engaging in electricity and thermal energy generation and supply, electricity distribution services and management of transmission system assets. Latvenergo Group holds one-third of the entire Baltic electricity market, thus ensuring its leadership in the Baltic electricity supply. Latvenergo AS has been acknowledged as the most valuable company in Latvia for several years in a row. International credit rating agency Moody’s has assigned Latvenergo AS an investment-grade credit rating of Baa2/stable.
Latvenergo Group includes the parent company Latvenergo AS (electricity and thermal energy generation and supply) and its subsidiaries Latvijas elektriskie tīkli AS (lease of transmission system assets), Sadales tīkls AS (electricity distribution), Elektrum Eesti OÜ (electricity supply in Estonia), Elektrum Lietuva UAB (electricity supply in Lithuania), Enerģijas publiskais tirgotājs AS (administration of electricity mandatory procurement process) and Liepājas enerģija SIA (electricity and thermal energy generation and supply), as well as Elektrum Latvija SIA (electricity supply), a subsidiary of Elektrum Eesti OÜ.