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INTER RAO Lietuva Group announces financial results for 2021 – Higher amounts of electricity traded with a jump in revenues and increase of the net profit

  • Electricity sales volume increased to 7 650 GWh in 2021 from 5 781 GWh in 2020 due to a sharp increase in the electricity market price and an increase in the overall electricity demand.
  • Revenues from sales reached EUR 334.3 million, compared to EUR 163.4 million in 2020, because of increases in trading volumes and market prices of electricity.
  • Group’s gross profit in 2021 reached EUR 42.7 million, compared to EUR 23.2 million in 2020.
  • Operating profit increased to EUR 33.2 million versus EUR 12.0 million a year ago.
  • Group’s net profit reached EUR 14.3 million, compared to EUR 12.2 million in 2020.
  • Group’s EBITDA reached EUR 36.9 million, with the EBITDA margin at 11.0%.
  • Electricity production at the Vydmantai wind farm decreased by 23.2% y/y due to much worse wind conditions in the area.
  • Electricity trading volume in Poland increased to 2 398 GWh from 1 825 GWh in 2020.

–  After difficult 2020, the year 2021 was even more challenging for all market participants. During the reporting period, the INTER RAO Lietuva Group managed to successfully handle risks coming from a demanding market environment, characterized by sudden and sharp increase in the average electricity prices observed especially in the 2nd half of 2021. The Group sold larger amounts of electricity in the Latvian and Polish markets. The sales in Lithuania went down as well as the electricity production at the Vydmantai wind power plant. The latter decrease was caused by a lower average wind speed in the region. The Group generated a gross profit on sales of EUR 42.7 million, EBITDA increased to EUR 36.9 million with the margin of 11.0 per cent, net profit reached EUR 14.3 million with the margin of 4.3 per cent. The Group generated EUR 0.72 earnings per share – says Giedrius Balčiūnas, CEO at INTER RAO Lietuva.

Key figures of IRL Group

Financial figures 2021 2020 2019
Sales [Revenues from contracts with customers] (EUR thousand) 334,339 163,371 317,034
Gross profit (EUR thousand) 42,666 23,240 24,461
Gross profit margin (%) 12.76% 14.23% 7.72%
Operating profit [profit from operations] (EUR thousand) 33,187 11,993 15,163
Operating profit margin (%) 9.93% 7.34% 4.78%
EBITDA (EUR thousand) 36,859 19,543 22,432
EBITDA profit margin (%) 11.02% 11.96% 7.08%
Net profit (EUR thousand) 14,345 12,209 17,647
Net profit margin (%) 4.29% 7.47% 5.57%
Number of shares (thousand) 20,000 20,000 20,000
Earnings per share (EUR) 0.72 0.61 0.88
Financial ratios 2021 2020 2019
Return on capital employed (%) 110% 55% 63%
Return on assets (%) 20% 24% 27%
Return on shareholders’ equity (%) 51% 49% 60%
Gearing ratio 0.04 0.05 0.17
Net financial debt to equity -0.72 -0.85 -0.75
Equity to assets ratio 0.40 0.50 0.45
Current ratio 1.45 1.47 1.35
Rate of turnover of assets (%) 21% 31% 21%

Revenues from sales

The revenues from produced electricity sales amounted to EUR 2.2 million in 2021, with a 66.4% decrease y/y. The decrease in electricity production at the Vydmantai wind park was caused by worse wind conditions in the area and the termination of the fixed feed in tariff at the end of the year 2020. The average wind speed in the area was 6.13 m/s in 2021 compared to 6.73 m/s in 2020.
Consolidated sales revenues doubled in 2021 y/y, reaching EUR 334.3 million. The total revenue increased mainly due to growths in volume (7 650 GWh in 2021 vs. 5 781 GWh in 2020) and in the electricity market price. The Group recorded higher volumes and revenues from electricity trading in Latvia and Poland, and lower volumes traded in Lithuania. The average annual electricity price in 2021 in the Lithuanian Nord Pool Spot zone equaled 90.45 EUR/MWh compared to 34.04 EUR/MWh in 2020, representing a 165.72% increase y/y.

In 2021 the Group fulfilled all its contractual obligations and supplied electricity to its clients at prices agreed upon in the contracts. Electricity was delivered to clients without any delays or disturbances and the Company remains a trusted counterparty and a reliable electricity supplier. Inter RAO Lietuva Group’s client base decreased from 814 at end of 2020 to 676 at end of 2021.

Earnings

Consolidated gross profit in 2021 increased by 83.6% y/y, reaching EUR 42.7 million (vs. EUR 23.2 million in 2020). However, the gross profit margin decreased to 12.8% in 2021 from 14.2% in 2020.

Consolidated profit from operations increased to EUR 33.2 million in 2021 versus EUR 12.0 million in 2020. Operating profit margin for the Group increased to 9.9%, compared to 7.3% a year ago.

In segment breakdown, due to worse meteorological conditions at the Vydmantai wind power plant and due to the expiration of the benefits from the fixed feed in tariff in 2020, the power generation segment’s contribution to the Group’s operating profit was at the level of 1.9%, compared to 12.8% a year before. The segment’s operating margin increased to 28.8% from 24.0% in 2020.

Operating results by segment

Segment Electricity trade Power generation
(EUR thousand) 2021 2020 2021 2020
Revenues 332,183 156,958 2,156 6,413
Operating profit 32,567 10,456 620 1,537
Operating margin 9.8% 6.7% 28.8% 24.0%

Profit before tax and the net profit of the Group in 2021 increased y/y and amounted to EUR 17.5 million and EUR 14.3 million respectively. The Group’s net profit margin in 2021 decreased to 4.3% (compared to 7.5% a year ago).

The Group generated a profit of EUR 0.72 per share in 2021 (EUR 0.61 in 2020).

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