Electrica Group posted consolidated net profit of 76 million RON in the first half of 2021
The Electrica Group recorded, in the first half of 2021, a consolidated net profit of 76 million RON, down by 59.8 percent compared to the same period of the previous year, generated mainly by the significant increase in energy acquisition costs.
Consolidated EBITDA reached RON 357 million, down RON 129 million compared to the first six months of 2020. The reduction in EBITDA is mainly due to the evolution of the supply segment, amid the increase in electricity purchase prices, as well as non-recurring positive elements in H1 2020.
The total revenues of the Electrica Group, in H1 2021, amounted to RON 3,339 million, representing an increase of 2 percent compared to the same period of the previous year.
In the supply segment, revenues were higher by 7.8 percent, mainly due to the increase in electricity sales prices in the retail market, while in the distribution segment, revenues decreased by 6.8 percent, mainly due to the net effect of the increase in distributed electricity revenues, a positive change offset by the reduction in revenues recognized in accordance with IFRIC 12.
Consolidated costs for the purchase of electricity and natural gas increased by 19.6 percent, to RON 2,167 million, in the first six months of 2021. This evolution was generated mainly by the supply segment, where costs increased by approximately 349 million. RON, or 24 percent, mainly from the increase in electricity purchase prices, both on the competitive segment and on the universal service and supplier of last resort (FUI) segment, which in 2020 was a regulated segment and was influenced by the recovery , in the form of positive corrections, of some acquisition losses from the previous years, when the tariffs approved by ANRE were below the actual purchase price of electricity, an effect that in 2021 no longer existed. There was also a 13.9 percent increase in the amount of electricity purchased in the competitive segment, compared to the same period last year.
Regarding the distribution segment, the evolution of electricity acquisition costs to cover network losses had an unfavorable effect on the consolidated costs of RON 6 million or 1.6 percent, mainly due to higher volumes of electricity required for coverage of network losses (negative impact of RON 5 million), but also from the increase of electricity purchase prices (negative effect of RON 1 million).
The Electrica Group distributed, in H1 2021, approximately 9.2 TWh (increase of 9.1 percent compared to H1 2020) to a number of approximately 3.8 million users.
In H1 2021, the Electrica Group supplied on the retail electricity market approximately 4.6 TWh (increase of 0.8 percent compared to H1 2020) to a number of approximately 3.5 million consumption places.
Electrica Furnizare has a market share of 18.54 percent; is the market leader on the SU and FUI segment, with a market share of 31.14 percent, on the competitive market with a share of 10.71 percent (according to the latest ANRE report available, in April 2021).
Corina Popescu, General Manager of Electrica SA, stated: “In the context of deep and rapid transformations in the energy market, dominated by unpredictability, energy trading prices have increased significantly, reaching record levels in the domestic market recently. This evolution, difficult to anticipate, determined by factors external to the company, generated a significant increase in electricity acquisition costs. Despite our risk management policies, part of the effect was also felt on the financial results in the first half.
This effect is also accentuated by the comparison with the performance registered in 2020 on the supply segment, an exceptional one, which also came from the favorable effect of the recoveries related to the previous years. However, we are a solid company and we have taken responsibility for our customers, making every effort to maintain a balance, including by optimizing costs for the end customer, even in this unfavorable context.
Throughout this period, we focused our efforts on continuing to make major investments in the area of production from renewable sources, on operational efficiency, on improving the services offered, but also on diversifying the activity through offers and services adapted to customer needs. All these measures will allow the sustainable development of the Group in the directions pursued by the approved strategy, with beneficial effects on the company’s profitability.”