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INTER RAO Lietuva Group announces financial results for 2018 – Trading volumes and profits increase y/y

  • Electricity sales volume increased to 6 235 GWh in 2018 versus 4 758 GWh in 2017.
  • During 2018 the client base of the Group increased to 1 453 from 1 433 in 2017.
  • Revenues from sales increased to EUR 288.3 million, compared to EUR 179.4 million in 2017, thanks to higher amount of electricity sold and higher prices in the NordPool system.
  • Group’s gross profit in 2018 increased to EUR 22.7 million from EUR 18.4 million in 2017.
  • Operating profit increased by EUR 4 million y/y and reached EUR 14.9 million.
  • Group’s net profit reached EUR 11.5 million compared to EUR 9 million in 2017.
  • Group’s EBITDA reached EUR 17.7 million, while the EBITDA margin decreased to 6.2%.
  • Electricity production at the Vydmantai wind farm decreased by 21.3% y/y due to worse wind conditions in the area.
  • The electricity trading volume in Poland amounted to 330 GWh versus 305 GWh in 2017.

– The year 2018 was challenging for all market participants. Due to a number of unexpected factors average prices in the NordPool system increased by 40 percent y/y in 2018. Despite this increase, the INTER RAO Lietuva Group fulfilled all its contractual obligations and delivered electricity to its clients at prices agreed upon in the contracts. The Group managed to balance its trading activity and deliver the best possible results in this challenging market situation. The electricity sales volume increased by 30 percent and the net profit reached EUR 11.5 million. The Group’s gross profit margin stood at 7.9 percent and the net profit margin amounted to nearly 4%. The Group generated a net profit of EUR 0.57 per share – says Giedrius Balčiūnas, CEO at INTER RAO Lietuva.

Key figures of IRL Group

Financial figures

2018

2017

2016

Sales [Revenues from contracts with customers] (EUR thousand)

288,269

179,378

178,880

Gross profit (EUR thousand)

22,716

18,354

18,943

Gross profit margin (%)

7.88%

10.23%

10.59%

Operating profit [profit from operations] (EUR thousand)

14,934

10,911

10,939

Operating profit margin (%)

5.18%

6.08%

6.12%

EBITDA (EUR thousand)

17,743

13,537

15,066

EBITDA profit margin (%)

6.16%

7.55%

8.42%

Net profit (EUR thousand)

11,454

8,974

9,256

Net profit margin (%)

3.97%

5.00%

5.17%

Number of shares (thousand)

20,000

20,000

20,000

Earnings per share (EUR)

0.57

0.45

0.46

 

 

 

 

       

Financial ratios

2018

2017

2016

Return on capital employed (%)

68%

41%

37%

Return on assets (%)

19%

19%

18%

Return on shareholders’ equity (%)

66%

50%

49%

Gearing ratio

0.45

0.83

0.83

Net financial debt to equity

-0.74

0.54

0.45

Equity to assets ratio

0.28

0.37

0.37

Current ratio

1.02

1.12

1.25

Rate of turnover of assets (%)

21%

27%

29%

 

Revenues from sales

Consolidated sales revenues rose by 60.4% y/y in 2018 to EUR 288.3 million. That increase came on the back of higher volumes of electricity traded (6 235 GWh in 2018 vs. 4 758 GWh in 2017) as well as higher prices in the NordPool system. The average annual electricity price in 2018 in the Lithuanian Nord Pool Spot zone was equal to 50.00 EUR/MWh compared to 35.13 EUR/MWh in 2017, a 42.3% increase y/y.

Revenues from produced electricity sales amounted to EUR 4.4 million in 2018, which represents a 21.2% decline y/y. The decrease in electricity production was mainly caused by worse wind conditions in the area of the Vydmantai wind park. The average wind speed in the area in 2018 was 5.9 m/s compared to 6.4 m/s during 2017.

In 2018 the Group fulfilled all its contractual obligations and delivered electricity to its clients at prices agreed upon in the contracts. Electricity was provided to clients without any delays and disturbances and the Company remains a trusted counterparty and a reliable electricity supplier. Inter RAO Lietuva Group’s client base increased slightly: from 1.433 at end-2017 to 1.453 at end-2018. 

Earnings

Consolidated gross profit in 2018 increased by 23.8% y/y, reaching EUR 22.7 million (vs. EUR 18.4 million in 2017). Gross profit margin in 2018 declined to 7.9% from 10.2% in 2017, but stayed at a healthy level.

Consolidated profit from operations increased by EUR 4 million to EUR 14.9 million in 2018. Operating profit margin for the Group was equal to 5.2%, compared to 6.1% a year ago.

In segment breakdown, the power generation segment decreased its contribution to Group operating profit to 9.6% from 20.6% a year before due to worse meteorological conditions at the Vydmantai wind power plant. 

Operating results by segment

Segment

Electricity trade

Power generation

(EUR thousand)

2018

2017

2018

2017

Revenues

283,913

173,848

4,356

5,530

Operating profit

13,837

8,666

1,097

2,245

Operating margin

4.9%

5.0%

25.2%

40.6%

Profit before tax and the net profit for the Group in 2018 increased y/y and amounted to EUR 14.8 million and EUR 11.5 million respectively. The net profit margin for the Group in 2018 was equal to 4% (compared to 5% a year ago).

The Group generated a profit of EUR 0.57 per share in 2018 (EUR 0.45 in 2017).

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