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INTER RAO Lietuva Group announces financial results for 1Q 2018 – Revenues increased by 23 per cent y/y, net profit stayed flat at EUR 2.6 million

  • Revenues from sales in 1Q 2018 increased by 23 per cent y/y to EUR 59.5 million thanks to higher volume of electricity sold.
  • Group’s gross profit on sales increased to EUR 5.3 million versus EUR 4.9 million in 1Q 2017.
  • Consolidated EBITDA amounted to EUR 4.1 million versus 3.8 million in 1Q 2017, while the EBITDA margin reached 6.8 per cent compared to 7.8 per cent a year ago.
  • Operating profit reached EUR 3.4 million, versus EUR 3.1 million in 1Q 2017.
  • Group’s net profit amounted to EUR 2.6 million and was equal to the profit generated a year ago.
  • Electricity sales volume increased to 1 481 GWh, compared to 1 321 GWh in 1Q 2017.

–  The first quarter of 2018 was marked by the increase of the electricity prices on the markets. The average price of the electricity sold via the NordPool system in the first 3 months of 2018 reached EUR 42.4/MWh vs. EUR 34.9/MWh a year before, but at the same time the price of power purchases increased as well. The INTER RAO Lietuva Group managed to generate a bit higher gross profit, at EUR 5.3 million, thanks to an increase in the amount of electricity sold in Lithuania. Net profit amounted to EUR 2.6 million, very close to the level recorded in Q1 2017. The standalone net profit of the parent company increased from EUR 2 million in the first 3 months of 2017 to EUR 3.5 million during the same period of 2018. Consolidated EBITDA increased to EUR 4.1 million with the EBITDA margin at 6.8 per cent. Earnings per share were the same as in 2017, EUR 0.13 – says Giedrius Balčiūnas, CEO at INTER RAO Lietuva.

Key figures of IRL Group

Financial figures 1st quarter 2018 1st quarter 2017
Sales (EUR thousand) 59,457 48,515
Gross profit (EUR thousand) 5,275 4,853
Gross profit margin (%) 8.87% 10.00%
Operating profit (EUR thousand) 3,440 3,136
Operating profit margin (%) 5.79% 6.46%
EBITDA (EUR thousand) 4,051 3,762
EBITDA profit margin (%) 6.81% 7.75%
Net profit (EUR thousand) 2,564 2,579
Net profit margin (%) 4.31% 5.32%
Number of shares (thousand) 20,000 20,000
Earnings per share (EUR) 0.13 0.13

Revenue from sales

The total consolidated sales revenue in January-March of 2018 was equal to EUR 59.5 million, 23 per cent more than in the first 3 months of 2017. Total revenue increased on the back of higher amounts of electricity traded, mainly on the Lithuanian market, and an increase in the average price of the electricity in the NordPool system compared to the prices in 1st quarter of 2017.

At the same time, the price of energy purchases also increased y/y in Q1 2018. The Group’s cost electricity purchases in January-March of 2018 amounted to EUR 54.2 million, a 24 per cent increase compared to the first three months of 2017. As a result of increasing the amount of electricity traded, the cost of sales of the Group was higher compared to the 1Q 2017 figure.

Earnings

Gross profit of the Group in January-March of 2018 amounted to EUR 5.3 million (compared to EUR 4.9 million a year ago), while the gross profit margin decreased to 8.9 per cent (vs. 10 per cent).

Group’s operating profit over the same period increased to EUR 3.4 million from EUR 3.1 million a year ago, while the operating profit margin amounted to 5.6 per cent.

In segment breakdown, the core electricity trade segment managed to increase its operating profit by 29% thanks to higher trade volumes. The segment’s operating margin also increased, by 0.2 percentage points y/y, to 5.4% in 1Q 2018. The power generation segment, in turn, witnessed a decline of revenues and operating profit due to worse meteorological conditions at the Vydmantai wind power plant. As a result, the segment’s contribution to Group operating profit declined to 9.6 per cent in 1Q 2018 from a high of 28.9 per cent a year before.

Operating results by segment

Segment Electricity trade Power generation
(EUR thousand) 1Q 2018 1Q 2017 1Q 2018 1Q 2017
Revenues 58,346 47,020 1,111 1,495
Operating profit 3,139 2,432 301 704
Operating margin 5.4% 5.2% 27.1% 47.1%

Group’s net profit in January-March of 2018 stayed at the same level as a year before and amounted to EUR 2.6 million. The profit margin, however, decreased from 5.3 per cent a year ago to 4.3 per cent in the accounting period.

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