INTER RAO Lietuva Group announces financial results for 2017 – Amounts of electricity produced and traded increased, the financial figures were close to the level of the year 2016
- Electricity sales volume increased to 4 758 GWh in 2017 versus 4 644 GWh in 2016.
- During 2017 the client base of the Group increased to 1 433 (1 191 in 2016).
- Revenues from sales increased slightly in 2017, to EUR 179.4 million, compared to EUR 178.9 million in 2016, thanks to higher amount of electricity sold, while the prices declined y/y.
- Group’s gross profit in 2017 decreased to EUR 18.4 million from EUR 18.9 million in 2016.
- Operating profit was flat y/y and reached EUR 10.9 million.
- Group’s net profit reached EUR 9 million compared to EUR 9.3 million in 2016.
- Group’s EBITDA reached EUR 13.5 million while EBITDA margin stood at 7.6%.
- Electricity production at the Vydmantai wind farm increased by 12.7% y/y thanks to better wind conditions in the area.
- The electricity trading volume in Poland amounted to 305 GWh versus 386 GWh in 2016.
– In 2017 prices in the Nord Pool system were lower compared to previous years. Despite that fact, the INTER RAO Lietuva Group managed to increase sales revenues on the back of higher amounts of electricity traded as well as its client base. The electricity sales volume was also supported by better meteorological conditions, which positively affected electricity generation and sales from the wind park owned by the Group. Thus the financial figures of the Group were very close to the numbers reported for the year 2016. The Group’s gross profit margin reached 10.2%, while the net profit margin stood at 5%. The Group generated a net profit of almost EUR 9 million, translating to EUR 0.45 per share – says Giedrius Balčiūnas, CEO at INTER RAO Lietuva.
Key figures of IRL Group
| Financial figures | 2017 | 2016 | 2015 |
| Sales (EUR thousand) | 179,378 | 178,880 | 186,694 |
| Gross profit (EUR thousand) | 18,354 | 18,943 | 29,602 |
| Gross profit margin (%) | 10.23% | 10.59% | 15.86% |
| Operating profit (EUR thousand) | 10,911 | 10,939 | 22,798 |
| Operating profit margin (%) | 6.08% | 6.12% | 12.21% |
| EBITDA (EUR thousand) | 13,537 | 15,066 | 25,301 |
| EBITDA profit margin (%) | 7.55% | 8.42% | 13.55% |
| Net profit (EUR thousand) | 8,974 | 9,256 | 18,819 |
| Net profit margin (%) | 5.00% | 5.17% | 10.08% |
| Number of shares (thousand) | 20,000 | 20,000 | 20,000 |
| Earnings per share (EUR) | 0.45 | 0.46 | 0.94 |
| Financial ratios | 2017 | 2016 | 2015 |
| Return on capital employed (%) | 41% | 37% | 56% |
| Return on assets (%) | 19% | 18% | 28% |
| Return on shareholders’ equity (%) | 50% | 49% | 75% |
| Gearing ratio | 0.83 | 0.83 | 0.96 |
| Net financial debt to equity | 0.54 | 0.45 | 0.17 |
| Equity to assets ratio | 0.37 | 0.37 | 0.37 |
| Current ratio | 1.12 | 1.25 | 1.37 |
| Rate of turnover of assets (%) | 27% | 29% | 36% |
Revenues from sales
The increase in the amount of electricity sold (4 758 GWh in 2017 versus 4 644 GWh in 2016) was mainly influenced by the increase in sales on the Lithuanian market and at the Latvian subsidiary: both companies signed more contracts with their clients.
Group sales revenues in 2017 were equal to EUR 179.4 million, approximately the same level as in 2016. Total revenues increased thanks to a higher amount of electricity sold, while the prices in the Nordpool system were lower compared to previous periods.
The increase was also caused by better meteorological conditions, which positively influenced electricity generation and sales from the wind park owned by the Group. Revenues from the sale of electricity produced by the plant sales reached EUR 5.5 million, a 12.7% y/y increase.
During 2017 the Company and the Group fulfilled all of its contractual obligations towards Clients and the Groups client base increased during the course of 2017 from 1.191 at end 2016 to 1.433 at end 2017. The Company and the Group improved relationships with the largest electricity consumers in the region.
Earnings
Gross profit in 2017 decreased 3.1% y/y, reaching EUR 18.4 million (vs. EUR 18.9 million in 2016). Gross profit margin in 2017 declined to 10.2% for the Group from 10.6% in 2016, but stayed at a healthy level.
Consolidated profit from operations was equal to EUR 10.9 million in 2017, the same level as in 2016. Operating profit margin for the Group was equal to 6.1%, roughly flat y/y.
In segment breakdown, the power generation segment increased its contribution to Group operating profit to 20.6% from just 6.2% a year before thanks to favorable meteorological conditions at the Vydmantai wind power plant and despite accounting for just 3% of the Group’s top line.
Operating results by segment
| Segment | Electricity trade | Power generation | ||
| (EUR thousand) | 2017 | 2016 | 2017 | 2016 |
| Revenues | 173,848 | 173,974 | 5,530 | 4,906 |
| Operating profit | 8,666 | 10,265 | 2,245 | 674 |
| Operating margin | 5% | 5.9% | 40.6% | 13.7% |
Profit before tax and the net profit for the Group in 2017 decreased slightly in annual terms and amounted to EUR 10.5 million and EUR 9 million respectively. The net profit margin for the Group in 2017 was equal to 5.0% (compared to 5.2% year ago).
The Group generated a profit of EUR 0.45 per share in 2017.