The net profit of Electrica Group, up 146% in the first 9 months


Bogdan Tudorache

The Electrica Group reported, for the first 9 months of 2020, a consolidated net profit of RON 396 million, registering an increase of RON 235 million, respectively 146.2%, compared to the same period of the previous year, the company announced.

Consolidated EBITDA reached RON 829 million, being higher by RON 280 million compared to the value at 9 months of 2019. The increase of EBITDA is mainly determined by the cumulative impact of the evolution of the supply segment, which registered an increase, at the level of EBITDA, of RON 130 million compared to the 9-month level of 2019, mainly due to lower electricity acquisition costs, corroborated with the increase in revenues, and the reversal of adjustments for the depreciation of uncertain receivables at Group level, in the amount of approximately 105 RON million, after adjusting the uncollected VAT from the Oltchim.

The revenues of the Electrica Group, in the first 9 months of 2020, amounted to RON 4,776 million, representing an increase of 3.7% compared to the same period of the previous year.

In the supply segment, revenues were higher by 4.3%, in the context of the increase in electricity sales prices on the retail market by 3.2%, but also to the increase in revenues from green certificates, the latter having a neutral impact in the supply margin.

In the distribution segment, revenues were 2.1% higher, mainly as a result of the increase in distribution tariffs, which offset the negative impact of the reduction in the amount of electricity distributed.

Consolidated costs for the purchase of electricity decreased by 2%, to RON 2,774 million, in the first 9 months of 2020. This evolution was generated by the supply segment, by decreasing by 2.7% the cost of purchased electricity for the supply activity, mainly following the reduction of electricity purchase prices on the regulated segment, reflecting the recovery in the form of positive corrections, of some unrecognized costs from the electricity acquisition from previous years, when the tariffs approved by ANRE did not reflect entirely the actual cost of purchasing electricity.

The favorable effect generated by the evolution of the supply segment was slightly reduced by the increase of electricity acquisition costs to cover network losses related to the distribution segment, by RON 7 million, due to the average purchase price of electricity actually achieved for own consumption in the first 9 months of 2020, compared to the same period in 2019.

“The results recorded by the Electrica Group in the first nine months of this year, a complicated one for everyone, prove that the adopted business model works.

We were able to quickly adapt to the unprecedented situation created by the health crisis, which had a major impact on the evolution of the global economy and, beyond implementing the necessary measures for business continuity, we identified opportunities for a sustainable evolution of the company.

The current context has not necessarily led to a change in priorities, but rather a need to focus efforts to accelerate their implementation. From this perspective, we managed to accelerate the major transformation projects planned for the entire Group, in all main business directions: distribution, supply and services. In addition to internal optimization and cost efficiency, we have become the largest investor in electricity distribution infrastructure in Romania and have continued to develop the business portfolio in both the supply and service areas, including by expanding the production area to renewable sources. The merger projects of the three distribution companies in the Group, as well as the two energy services companies, will generate synergies that will add value to all stakeholders.

We quickly adapted to the new working and business conditions, but we kept what matters to each of us – a safe environment for our customers, partners and employees.

Next, we rely on increasing operational performance, improving service quality and optimizing costs for the end customer. To these are added the long-term strategic directions, focused on consolidating and developing the business model, corroborated with the company’s preparation to face future challenges,” said Corina Popescu, General Manager, Electrica.

The Electrica Group distributed, between January and September 2020, approximately 12.87 TWh (down 3% compared to 9M 2019) to a number of approximately 3.8 million users.

In the first 9 months of this year, the Electrica Group supplied to the retail market approximately 6.8 TWh (down 0.5% compared to 9L 2019) to a number of approximately 3.6 million consumers.

Electrica Furnizare has a market share of 19.47%. It is the leader on the regulated market, with a market share of 54.20%, and on the competitive market it has a share of 11.06% (according to the ANRE report for August 2020).


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