OREANDA-NEWS. In the first nine months of 2015, Latvenergo Group's revenue constitutes 685.9 million euros, which is 8% less than in the respective period of the previous year. The decrease of revenue is mainly determined by the discontinuation of recognition of the mandatory procurement public service obligation fee income in the revenue of Latvenergo Group along with the entrance into operation of Ener?ijas publiskais tirgot?js AS as of 1 April 2014. In turn, the EBITDA* of the Group constitutes 236.2 million euros, which has increased by 32% compared to the respective period in 2014, and the profit of the Group constitutes 68.6 million euros. Investments amount to 136.7 million euros.

Riga, 2015-11-30 13:07 CET (GLOBE NEWSWIRE) -- In the first nine months of 2015, Latvenergo Group is the largest retail electricity supplier in the Baltics with market share of approximately 1/3 of the total electricity retail market. The number of customers in Lithuania and Estonia has increased by 5% compared to the respective period last year. In total, retail electricity supply in the Baltics reached 5,801 GWh. The amount of electricity supplied in Lithuania and Estonia constitutes 1,875 GWh, which is by 40% more than the competing electricity traders have supplied in Latvia.

In the first nine months of 2015, Latvenergo Group power plants have generated 2,676 GWh of electricity and 1,584 GWh of thermal energy. Compared to the respective period last year, the amount of generated electricity has not changed significantly – Daugava hydropower plants (HPPs) have generated 1,590 GWh, whereas Riga combined heat and power plants (CHPPs) have generated 1,048 GWh. Similarly to 2014, also in 2015 the operation of Daugava HPPs was influenced by uncommonly low water flow in Daugava. Such a low annual average water flow has previously only been observed in 1976. Whereas Riga CHPPs ensured an opportunity to stabilize the electricity price in the Latvian and Lithuanian bidding area and limited the risk of increase in the electricity price.

In the first nine months of 2015, Latvenergo Group revenue constituted 685.9 million euros and profit – 68.6 million euros (2014: 784.9 million euros and 30.0 million euros respectively). The decrease of Latvenergo Group revenue was determined by changes in financial results accounting principles starting from the entrance into operation of Ener?ijas publiskais tirgot?js AS as of 1 April 2014, thereby, mandatory procurement payments are not recognized in the statement of profit or loss. In turn, the improvement in the profitability was mainly determined by the opening of electricity market to households in Latvia as of 1 January 2015. Until then, Latvenergo AS supplied electricity to households at regulated tariffs, which were below the market price.

The total amount of investments in the first nine months of 2015 constitutes 136.7 million euros, which is by 19% more than in the respective period of the last year. We have invested a significant amount  for the modernization of networks to ensure high quality, technical indicators and safety of operation of network services. In the first nine months of 2015, investments in network assets constitute 63% of the total amount. Latvenergo Group continues to carry out its most significant investment projects: the program for reconstruction of hydropower units of Daugava HPPs, the project Kurzeme Ring and the Latvian-Estonian third power transmission network interconnection. The investment in the reconstruction program of hydropower units of Daugava HPPs constitutes 26.9 million euros in the 9 months of 2015.

The unaudited interim condensed financial statements of Latvenergo Group for 2015 will be published on 29 February 2016.

* 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

Performance indicators

    9 months 2015 9 months 2014
Retail electricity supply GWh 5,801 6,485
Electricity generation GWh 2,676 2,688
Thermal energy supply GWh 1,525 1,575
Number of employees   4,180 4,560
Moody's credit rating   Baa2 (stable) Baa3 (stable)

 Financial indicators

    9 months 2015 9 months 2014
Revenue million EUR 685.9 748.9
EBITDA 1) million EUR 236.2 178.6
Net profit million EUR 68.6 30.0
Assets million EUR 3,530.5 3,522.3
Equity million EUR 2,060.3 2,020.2
Net debt 2) million EUR 682.5 713.7
Investments million EUR 136.7 114.6

 Financial coefficients

    9 months 2015 9 months 2014
Net debt / EBITDA 3)   2.3 3.2
EBITDA margin 4)   31% 22%
Capital ratio 5)   58% 57%

 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-month rolling)

4) EBITDA margin: EBITDA / revenue (12-month rolling)

5) Capital ratio: total equity/ total assets

 Consolidated statement of profit or loss*

for a period of 9 months, which ends on 30 September 2015

    01/01–30/09/2015 01/01–30/09/2014
    EUR'000 EUR'000
       
Income   685,945 748,885
Other income   3,630 2,155
Used raw materials and consumables   (336,343) (454,364)
Staff costs   (71,151) (73,323)
Depreciation, amortisation, and impairment of fixed assets   (149,040) (131,843)
Other costs of economic activity   (45,873) (44,712)
Profit of economic activity   87,168 46,798
Financial income   2,192 2,227
Financial costs   (14,557) (15,206)
Share of profit / (loss) of associated companies   – (493)
Profit before taxes   74,803 33,326
Corporate income tax   (6,208) (3,308)
Profit in the reporting period   68,595 30,018

Consolidated report on the financial condition*   

    30.09.2015 31.12.2014
    EUR'000 EUR'000
ASSETS      
Long-term assets      
Intangible investments and fixed assets   3,063,833 3,079,327
Investment properties   751 1,343
Long-term financial investments   41 41
Financial assets retained until the end of the term   20,623 28,528
Other long-term debtors   7 14
Total long-term assets   3,085,255 3,109,253
       
Current assets      
Stocks   26,783 22,560
Debts of buyers and customers, and other debtors   241,244 233,752
Financial assets retained until the end of the term   7,860 –
Cash and cash equivalents   169,407 121,011
Total current assets   445,294 377,323
TOTAL ASSETS   3,530,549 3,486,576
       
EQUITY CAPITAL      
Share capital   1,288,446 1,288,446
Reserves   649,320 645,829
Undistributed profit   116,269 79,995
TOTAL share of participation in the capital by shareholders of the parent company   2,054,035 2,014,270
Share of participation in the capital by minority shareholders   6,245 6,531
Total equity capital   2,060,280 2,020,801
       
CREDITORS      
Long-term creditors      
Loans   747,986 688,297
Liabilities of deferred corporate income tax   269,788 268,026
Savings   14,971 15,588
Financial derivatives   10,391 11,698
Other creditors and income in the next periods   195,001 194,474
Total long-term creditors   1,238,137 1,178,083
       
Short-term creditors      
Debts to suppliers and other creditors   120,011 139,912
Loans   103,955 138,925
Financial derivatives   8,166 8,855
Total short-term creditors   232,132 287,692
Total creditors   1,470,269 1,465,775
TOTAL LIABILITIES   3,530,549 3,486,576

* - unaudited condensed consolidated financial reports. Prepared in accordance with the International Financial Reporting Standards approved by the European Union.

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 t?kli AS (management of transmission system assets), Sadales t?kls AS (electricity distribution), Elektrum Eesti O? (electricity  supply in Estonia), Elektrum Lietuva UAB (electricity supply in Lithuania), Ener?ijas publiskais tirgot?js AS (administration of electricity mandatory procurement process) and Liep?jas ener?ija SIA (electricity and thermal energy generation and supply), as well as Elektrum Latvija SIA (electricity supply), a subsidiary of Elektrum Eesti O?.