OREANDA-NEWS. October 28, 2009. DTEK, the fuel and energy industry leader in Ukraine today announces its unaudited consolidated financial results for the six months ended 30 June, 2009.
 
Key financial highlights:

Consolidated revenue increased 10.9% to 6,706m UAH (H1 2008: 6,048m UAH)
Gross profit of 1,087m UAH (H1 2008: 1,642m UAH). Decrease is mainly due to increased depreciation charge resulting from revaluation of property, plant and equipment held at 31 December, 2008 and increased pension reserves (increase due to change in pension legislation)
Gross Profit margin of 16.2% (H1 2008: 27.1%)
Net profit decreased from 777m UAH to 248m UAH principally due to non-cash expenses (increased depreciation charge and pension reserves increase due to change in pension legislation)
EBITDA decreased from 1,605 m UAH to 1,468 m UAH and the EBITDA margin decreased correspondingly from 26.5% to 21.9%.

Operational highlights:

DTEK’s market share of Ukraine’s total coal production increased to 30.3% from 27.8%, according to the Ministry of Coal of Ukraine.  Coal production volumes decreased by 1.7% to 8.6m tonnes. At the same time, Ukraine’s total extraction volumes decreased by 9.3% year-on-year due to the country’s economic slowdown. DTEK maintained its leadership position in the Ukrainian thermal generation sector, according to SE “Energorynok”, with 45.5%  market share (15.4% of total generation) including the production of Dneproenergo[1], a DTEK affiliate company
DTEK’s share of the wholesale electricity market in Ukraine rose by 1.0% to 7.5% of the total volume of marketable electricity supply
Record-low transmission network losses of 1.6%

Financing and new developments:

USD 15m loan from Sberbank agreed.
In January, 2009, DTEK signed a EUR15.24 million agreement with the Czech mining equipment manufacturer Ostroj, to purchase roof supports for its Komsomolets Donbassa Mine. DTEK’s financial partner in the project was UniCredit Bank Czech Republic a.s. The bank has agreed a five-year loan at Euribor +1.9%. The credit risk is insured by the EGAP export credit insurance agency.
In February 2009, DTEK placed a further order with Ostroj worth approximately EUR20 million for its coal mining unit Pavlograduhol. DTEK’s financial partner in this project was the Ceska Sporitelna, a.s. Bank, which agreed a five-year loan at Euribor +1.7%. Pavlogradugol plans to commission the new sets in October 2009.
DTEK’s existing financial commitments continue to be met, in line with scheduled repayments, including a \\$21.8m installment on its \\$150m international syndicated loan, made on time in May 2009.
DTEK’s coal mining and power generating units have successfully completed the certification process for its safety management system, which meets the international standard OHSAS 18001:2007.

Commenting on the results, Maxim Timchenko, Chief Executive Officer of DTEK, said:
 
“The results for the first half of 2009 reflect both DTEK’s underlying financial strength, but also the more challenging economic conditions in which we are operating. The continued confidence of our banking partners is a strong endorsement of DTEK’s capability in its core markets and ability to generate value for shareholders. 
 
“We continue to be confident that the combination of DTEK’s vertically integrated business model, the location of its main production units, and the skills and experience of our professional management team means we are well placed to advance our expansion strategy as conditions stabilize and improve. This, coupled with the progress we have continued to make in the development and evolution of our operational infrastructure, will help us maintain our position at the forefront of the Ukrainian energy industry.”
 
Yuriy Ryzhenkov, Chief Financial Officer of DTEK, added:
 
“Despite the economic slowdown and turmoil in the global financial markets we have delivered solid financial results. Whilst we have recorded declines in some of our financial indicators, it is important to note that they result largely from non-cash, non-recurring charges, which are not reflective of the sound financial basis from which DTEK continues to operate.
 
“We have managed our financial resources prudently, ensuring that all of DTEK’s loan repayments were made according to schedule. As a result, DTEK has not required any restructuring of its credit and debt portfolio, which positions us strongly relative to the market as a whole. Most importantly, it demonstrates DTEK’s diligent financial management and underlines its commitment to delivering on its obligations to all of its partners and stakeholders.
 
“We have also reiterated our commitment to operate in line with all major international regulatory requirements and through issuing our results on a timely basis, we have again demonstrated our adherence to international best practice.”