OREANDA-NEWS. August 04, 2009. The revenue of Eesti Energia for the first quarter of the financial year 2009/10 amounted to 146 million euros. The group posted an operating profit of 29 million euros and a net profit of 22 million euros. Positive contributors to the financial results included cost management program as well as an increase in the revenue from electricity sales, which was mostly influenced by an increase in export revenue, reported the press-centre of Eesti Energia.

According to Eesti Energia financial director Margus Kaasik, the first three months of the financial year beginning in April proved successful for the company. “Despite the negative influence of the economic environment, as well as a decrease in electricity and thermal energy sales volumes, Eesti Energia’s financial results remain strong. This has mostly been achieved by an increase in export revenue and cost management,” said Kaasik.

Expenses related to transportation and tools decreased the most as a result of cost cutting, dropping by 30,8% compared to the first quarter of the last financial year. 27.2% decrease was experienced in equipment maintenance and repairs expenses and 14.3% reduction in personnel expenses.

“Strict cost management allowed to significantly slow down the increase in expenditure, resulting in an improvement in group efficiency which, in turn, allowed to maintain profitability and ensure the necessary investment volume,” Kaasik explained. In the first three months of the financial year 2009/2010, Eesti Energia invested a total of 48 million euros, with the bulk (21 million euros) invested in power networks.

Eesti Energia’s investment strategy continues to pursue corporate growth and energy development, and is based on criteria associated with economic efficiency, environment-aware development and security of supply. In addition to power networks, major investments were also made in the area of electricity and thermal power production (23 million euros), with the biggest investment projects including Aulepa Wind Park and desulfurization equipment installations at Narva power plants.

The highlights of the first quarter of the financial year 2009/2010 of Eesti Energia included investment decision for a new shale oil plant, which exploits new, more efficient technology, as well as organisation of a public procurement for the establishment of two new oil shale blocks for electricity production.

In order to upgrade and develop the Estonian power networks, Eesti Energia concluded a loan agreement with the European Investment Bank (EIB), borrowing 150 million euros on favourable terms. The investments to be made in the power networks support the EU common objective for diversification and assurance of the internal supply of energy, and promote the role of Eesti Energia in the Baltic market.

In June, Eesti Energia opened Aulepa Wind Park, the most powerful among its kind in the Baltic States. This constitutes Eesti Energia’s first major investment in renewable energy development. The project had a total cost of nearly 58 million euros and it was self-financed by Eesti Energia. The capacity of Aulepa Wind Park is 39 megawatts (MW), with the annual output amounting to approximately 100 gigawatt-hours (GWh), i.e. 1.3% of final consumption in Estonia.

In the financial year 2009/2010, Eesti Energia has significantly enhanced its portfolio of products and services. More than three hundred customers subscribed to the Green Energy package, with contracts concluded at the total volume of 17 gigawatt-hours (GWh). From May 2009 onwards, Eesti Energia has also offered both private and corporate customers on-site services, from installation of electrical sockets to work requiring electrical projects. From June 2009, Eesti Energia also provides energy labels for buildings?the mandatory document for new buildings, or for sale or lease of buildings or apartments.

The number of the mobile Internet service KOU users showed a remarkable increase. As of the end of June, KOU had nearly 24,000 active customers. This constitutes a 32.1% (over 5,800 customers) increase from the end of June 2008.

Expressing the significant expansion of the activities of Eesti Energia, as a result of which an electricity company has become a full energy solution provider operating in Estonia as well as on the international market, Eesti Energia incorporated all of its subsidiaries under the same trademark that bears a new visual identity.

As a result of the general economic decline, domestic sales of electrical energy decreased in the first quarter of the financial year 2009/2010. A total of 929 GWh of electrical energy was sold to corporate customers (i.e. a decrease of 12.8%, year-on-year) and 168 GWh of electrical energy to network operators (i.e. a decrease of 5,4%, year-on-year). Sales to private customers showed a 4.8% increase, amounting to a total of 393 GWh. Sales to household customers were affected by a lower external temperature, as well as advance submission of the meter readings in connection with the rise in the value-added-tax rate from 1 July 2009. Eesti Energia sold a total of 1,490 GWh of electrical energy on the domestic market, constituting a 7.9% decrease from last year.

Export of electrical energy experienced substantial growth. In the first quarter, a total of 482 GWh of electrical energy was exported?a 18% increase, compared to the first three months of the previous year. Lower price at the Nordic electrical energy exchange Nord Pool has decreased sales to Finland by 152 GWh. This, however, is balanced out by the 203 GWh increase in Latvian sales. This includes 88 GWh of electricity sold by Eesti Energia to customers on the open market of Latvia, an increase of 85 GWh compared to the first quarter of the previous financial year.

Eesti Energia thermal energy sales amounted to 161 GWh in the first quarter of the financial year 2009/2010, dropping by 41.8%, compared to the first quarter of the last financial year. The main contributor to the drop in thermal energy sales is the entry of a new thermal energy producer?a producer not associated with Eesti Energia?on the Tallinn thermal energy market.