INTER RAO Lietuva Group announces financial results for 1H 2015: Strategies of changing markets situation led to the better results of the Group

• Group’s gross profit increased by 16.08% to EUR 13.84 million from EUR 10.41million in1H2014.
• Operating profit reached EUR 10.45 million, versus EUR 7.36 million in1H2014.
• Group’s net profit increased to EUR 8.64 million from EUR 5.95 million in1H2014.
• Group’s EBITDA increased to EUR 11.69 million while EBITDA margin increased to 13.58 percent from 9.29 percent a year ago.
• Electricity trading volume was 2 047 GWh, compared to 1 970 in the1H2014.
• Revenue from sales decreased by 8.1%, to EUR 86.09 million, compared to EUR 93.72 million in the1H2014,due to the continuous changes in trading structure, further diversification of trading portfolio between countries and lower electricity prices in the markets.
• The electricity trading volume in Poland increased from 4 GWh in the 1H 2014 to 128 GWh in the 1H 2015.

–  The flexibility of the INTER RAO Lietuva Group to challenge the new market situations allowed to get the better profitability results despite the lower electricity prices on the NordPoolSpot market.  Continuous changes in trading structure and further diversification of trading portfolio between countries led to increase thenet profit of the Group to EUR 8.6 million in the 1^st half of 2015 and to get the much better result than a year before. Net profit margin improved from 6.3% to industry normal 10%. The Group has earned EUR 0.43 per share, 13 EUR cents more than during the same period in 2014 – says Giedrius Balčiūnas, CEO at INTER RAO Lietuva.

Key figures of IRL Group

Revenue from sales

Group’s sales decreased by 8.1 per cent in 1^st half 2015, compared to the same period in 2014. However, decrease in cost of sales was deeper than decrease in sales – 13.3 per cent, if compared to 1^st half of 2014. Such a decrease in costs of sales was mainly due to the continuous changes in trading structure, further diversification of trading portfolio between countries and lower electricity prices in the markets. Therefore despite the decrease in sales, the Group’s gross profitability equaled to 16.08 per cent in the accounting period, if compared to 11.11 per cent in January-June 2014.

Revenue from produced electricity sales accounted for EUR 3 million, a 21.14 per cent more than in the same period a year ago. During the accounting period Vydmantai wind park, UAB has produced a higher amount of electricity compared to long-term average, due to positive meteorological conditions: higher wind speeds. The better wind conditions than the estimated long-term average lead to one of the best results of Vydmantai wind park, UAB since the beginning of performance of the wind park in 2006.

Earnings

Gross profit of the Group amounted to EUR 13.8 million, compared to EUR 10.4 million in the same period a year ago. Gross profit margin of the Group in the accounting period amounted to 16 per cent and was higher compared to a year ago, when gross profit margin was equal to 11,1 per cent.

Group’s operating profit over the same period accounted to EUR 10.4 million, while the operating profit margin increased to 12.14 per cent from 7.85 per cent a year ago. As a result, profit before tax for the Group in the accounting period amounted to EUR 10.04 million compared to EUR 6.94 million in the 1^st half in 2014.

Group’s net profit in the 1st half of 2015 amounted to EUR 8.6 million, if compared to the profit of EUR 5.9 million for the same period year ago. The profit margin increased from 6.34 per cent a year ago to 10.04 per cent in the accounting period. Increase in profit was due to the set of risk management policies, change in trading structure the Group undertook in a response to the uncertainties associated with technical limitations of interconnection links, further expansion and diversification of trading activities in all the countries and better results from sales of electricity generated in the wind park.