Emitents | Latvenergo, AS (213800DJRB539Q1EMW75) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Veids | 1.1 Gada finanšu pārskati un revīzijas ziņojumi | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Valoda | EN | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Statuss | Publicēts | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Datums | 2019-04-17 16:01:36 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Teksts |
Today, 17 April, the audited financial results of Latvenergo Group for 2018 are published. They were approved by the Management Board of Latvenergo AS on 16 April. Along with the Latvenergo Consolidated Report and Latvenergo AS Annual Report 2018, the Sustainability Report, which has been prepared in accordance with the GRI Standards Guidelines, and the Latvenergo AS Corporate Governance Report 2018 are published. In 2018, the electricity market was affected by dry and hot weather conditions in Europe, which caused an unexpected rise in electricity prices. Under these circumstances, the Group efficiently used the advantages of its diversified generation facilities, generating the largest amount of electricity at Latvenergo AS combined heat and power plants since 1990. In 2018, Latvenergo Group was the most valuable energy company in the Baltics, with the value of its assets amounting to EUR 3.8 billion at the end of the year. The Group’s revenue amounted to EUR 878.0 million, which is 5% less than in 2017. EBITDA dropped by 41%, reaching EUR 321.6 million. The Group’s profit for 2018 amounted to EUR 76.0 million. The results were impacted by a 44% drop in electricity generation at the Daugava hydropower plants (HPPs) due to a smaller water inflow in the Daugava River as well as the decision of Latvenergo AS to apply for a one-off compensation, opting out of the receipt of 75% of the annual electrical capacity payments for combined heat and power plants and thereby providing opportunities for reducing the mandatory procurement component (MPC). Latvenergo Group’s operations and performance in 2018 were influenced by global and regional operational environment factors, such as increased prices of electricity, natural gas and CO2 emissions allowances. Prolonged hot and dry weather conditions significantly reduced the output by hydropower plants, especially in Scandinavia, thereby contributing to the rise in electricity prices across Europe. The average electricity price in Latvia in 2018 was 44% higher than a year before, reaching almost 50 EUR/MWh. Seasonal flood in January 2018 even placed Latvia in the position of the largest electricity exporter in the Baltics, but overall the output by Daugava HPPs in 2018, compared to previous year, decreased by 44% and was 2,380 GWh. Consequently, the combined heat and power plants (CHPPs) of Latvenergo AS played a very important role in ensuring electricity demand last year, which compensated for the shortage of hydropower output. In 2018, the CHPPs generated 2,644 GWh of electricity, which is 87% more than previous year. At the same time, it was the largest amount of electricity produced by the CHPPs since 1990. In 2018, Latvenergo AS generated 5,076 GWh of electricity at its generation facilities. In 2018, Latvenergo Group was one of the leading energy traders in the Baltic states. The start of natural gas trade in Lithuania in October 2018 means that Latvenergo now operates in all energy market segments in Latvia, Lithuania and Estonia. Latvenergo continuously develops new business areas and services, and the latest Elektrumservice is the sale of natural gas to Latvian households from February 2019. The company continues to efficiently develop its operations in the Baltic states by offering its customers Elektrum Solārais (Elektrum Solar) and Elektrum Viedā māja (Elektrum Smart House)products. In 2018, a total of 7.0 TWh of electricity were sold to retail customers in the Baltics, which is approximately the same amount as previous year. The amount of electricity sold was 4.4 TWh in Latvia, 1.6 TWh in Lithuania and 0.9 TWh in Estonia. In 2018, the mandatory procurement component decreased, which was facilitated by the decision of Latvenergo AS to opt out of the receipt of 75% of the annual electrical capacity payments for the CHPPs, at the same time receiving a one-off compensation from the state. Thus, the impact of the CHPPs on the mandatory procurement and capacity payment dropped from 37% to 15% or by EUR 74.2 million in 2018. The Group’s financial results were negatively impacted by the 75% smaller electrical capacity revenue at the CHPPs and a substantially lower output at the Daugava HPP cascade. The revenue of Latvenergo Group in 2018 dropped by 5%, amounting to EUR 878.0 million. EBITDA decreased by 41%, reaching EUR 321.6 million. The Group’s profit for 2018 amounted to EUR 76.0 million (EUR 322.0 million in 2017). In 2017, the profit of Latvenergo Group was comprised of the Group’s operating result: a profit in the amount of EUR 172.9 million and a deferred tax reversal in the amount of EUR 149.1 million as a result of the corporate income tax reform. The total amount of Latvenergo Group’s investments reached EUR 220.6 million in 2018. The biggest amount of investments (approximately 80% of overall investments) was made in the modernisation of the networks with a view to ensuring high quality of network services and improving technical performance and operational reliability. EUR 21.1 million was invested in the reconstruction of the hydropower units of the Daugava HPPs. Investments in the large transmission projects, Kurzeme Ring and the Third Estonia–Latvia power transmission network interconnection, continue as well. In 2018, the Group implemented both internal process and governance projects and external digitisation projects related to communication with customers. By the end of the reporting year, the share of smart meters installed by Sadales tīkls AS was 49% of the total number of meters, thus effectively managing customer consumption information. Latvenergo AS carried out customer service projects that currently provide a full range of digital service options. The implementation of digitisation has contributed to the increased efficiency of the Group, allowing for reducing the number of employees and the necessary resources, for example, in the field of transport and real estate. On 19 March 2019, after the end of the reporting period, the International Credit Rating Agency Moody’s reconfirmed the credit rating for Latvenergo AS: Baa2 with a stable outlook. The Latvenergo Group Sustainability Report has been prepared in accordance with the requirements of the GRI Standards Guidelines. The report contains information about the Group, its governance and operating segments. The document also provides information on the economic, social and environmental topics relevant to the Group’s operations. The Sustainability Report 2018 has been audited by PricewaterhouseCoopers SIA. The Latvenergo AS Corporate Governance Report 2018 is published along with the financial results of Latvenergo Group. The Corporate Governance Report attests that Latvenergo Group has followed all the good corporate governance principles applicable to its operations in all major aspects. The Corporate Governance Report was prepared for the first time for the year 2012 when the Bond Issue Programme was launched and the issued bonds were listed on Nasdaq Riga Exchange. The report has been prepared according to the Financial Instrument Market Law and the Principles of Corporate Governance and Recommendations on Their Implementation issued by Nasdaq Riga AS in 2010.
LATVENERGO GROUP KEY FIGURES Operational figures
* Including operating consumption ** Including sale of energy purchased within the mandatory procurement on the Nord Pool
Financial figures* EUR’000
1) EBITDA – earnings before interest, income tax, share of result of associates, depreciation and amortisation, and impairment of intangible assets and property, plant and equipment 2) Dividends paid to the equity holder of the Parent Company. 3) Net debt = borrowings at the end of the year minus cash and cash equivalents at the end of the year * Information about the financial indicators and coefficients used by the Latvenergo Group is available in Latvenergo Group's consolidated and Latvenergo AS Annual Report, see the section “Key Figures”. ** In 2017, the net profit includes a deferred tax reversal in the amount of EUR 149.1 million as a result of the corporate income tax reform. Operating profit: EUR 172.9 million.
Financial ratios*
4) EBITDA margin = EBITDA / revenue 5) Net debt / EBITDA = (net debt at the beginning of the year + net debt at the end of the year) * 0.5 / EBITDA (12-months rolling) 6) Net debt / equity = net debt at the end of the year / equity at the end of the year 7) Return on assets (ROA) = profit / average value of assets ((assets at the beginning of the year + assets at the end of the year) / 2) 8) Return on equity (ROE) = profit / average value of equity ((equity at the beginning of the year + equity at the end of the year) / 2) 9) Return on capital employed (ROCE) = operating profit / (average value of equity ((equity at the beginning of the year + equity at the end of the year) / 2) + average value of borrowings ((borrowings at the beginning of the year + borrowings at the end of the year) / 2)) * Information about the financial indicators and coefficients used by the Latvenergo Group is available in Latvenergo Group's consolidated and Latvenergo AS Annual Report, see the section “Key Figures”.
Consolidated Statement of Profit or Loss* EUR'000
* 2018 annual audited consolidated financial statements prepared in accordance with the IFRS as adopted by the European Union ** in 2017 deferred tax liabilities reversed in the Statement of Profit or Loss in accordance with the changes of tax regulations and laws of the Republic of Latvia starting from 1 January 2018
Consolidated Statement of Financial Position* EUR'000
* 2018 annual audited consolidated financial statements prepared in accordance with the IFRS as adopted by the European Union
Additional information: Jānis Irbe www.latvenergo.lv About Latvenergo Latvenergo Group is one of the leading energy suppliers in the Baltics operating in electricity and thermal energy generation and trade, natural gas trade, electricity distribution services and lease of transmission system assets. Latvenergo AS has been acknowledged as the most valuable company in Latvia for several times. International credit rating agency Moody’s has assigned Latvenergo AS an investment-grade credit rating of Baa2/stable. Latvenergo Group is comprised of the parent company Latvenergo AS (generation and trade of electricity and thermal energy, trade of natural gas) and seven subsidiaries - Latvijas elektriskie tīkli AS (lease of transmission system assets), Sadales tīkls AS (electricity distribution), Elektrum Eesti OÜ (trade of electricity and natural gas in Estonia), Elektrum Lietuva UAB (trade of electricity and natural gas in Lithuania), Enerģijas publiskais tirgotājs AS (administration of mandatory electricity procurement process) and Liepājas enerģija SIA (generation and trade of thermal energy in Liepaja, electricity generation). All shares of Latvenergo AS are owned by the state and held by the Ministry of Economics of the Republic of Latvia. |
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