Hrvatska elektroprivreda More than electricity. Consolidated Financial Statements 1H 2018

Transcription

1 Hrvatska elektroprivreda More than electricity Consolidated Financial Statements 1H 218

2 Contents 1H 218 Key highlights Operations results Financial results Q&A 2

3 This Presentation contains certain forward-looking statements that reflect HEP's current views with respect to future events and financial and operational performance, including but not limited to risks specific to HEP's business and the implementation of strategic initiatives, as well as other statements relating to HEP s future business development and economic performance. Forward-looking statements are statements in this Presentation that do not relate to historical facts and events. The words "will", "believes", "assumes, "intends", "estimates", "expects", "may", "plans", "seeks", "approximately", "aims", "projects", "anticipates" or similar expressions regarding indications or prognoses of future developments or trends, which are not statements based on historical facts, constitute forward-looking information. While these forward-looking statements represent HEP's judgments and future expectations concerning the development of its business, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from HEP's expectations. In light of these risks, uncertainties and assumptions, it is possible that the future events referred to in this Presentation may not occur. Because these forward-looking statements involve known and unknown risks and uncertainties, the outcome could differ materially from those set out in the forward-looking statements as a result of: absence of the ownership title with respect to certain properties, including real estate connected to 17 out of 26 of the hydro power plants which the Group currently operates in the Republic of Croatia; HEP's ability to maintain and increase market share for its products and services and control expenses; changes in the competitive environment and competitive pressures; any declines in property values and asset quality; any decline in the availability of financing at acceptable prices; changes in general economic and business conditions; changes and fluctuations in interest rates, share prices and exchange rates; political, governmental, legislative and regulatory changes or changes in political or social conditions; changes in HEP's credit ratings; changes in economic conditions in the countries in which the Group operates; the extent and nature of future developments in the lending market and in other market segments that have been affected by the global financial crisis and the European sovereign debt crisis; other market and macro-economic developments, including movements in local and international securities markets, credit spreads, currency exchange rates and interest rates, whether or not arising directly or indirectly from the global financial crisis or the European sovereign debt crisis; changes in internal risk control; limitations in the effectiveness of HEP's internal risk management processes, of its risk measurement, control and modelling systems, and of financial models generally; developments relating to HEP's access to capital and funding; changes in the financial position or creditworthiness of HEP's customers, obligors and counterparties, and developments in the markets in which they operate; management changes and changes to the structure of HEP's business group; the occurrence of operational failures, such as fraud, unauthorized trading and systems failures; technological developments; and the impact of all such future developments on positions held by HEP. Additional factors that could cause HEP's actual business, results of operations or financial condition to differ from the forward-looking statements include, but are not limited to, the other factors that HEP has indicated in other parts of this Presentation which could materially adversely affect its business and financial performance. The forward-looking statements included in this Presentation speak only as of the date of this Presentation. HEP undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise 3

4 Key Facts Total electricity sales in Croatia 7,121 GWh 7% Electricity generation 7,12 GWh 18% Heat sales 1,57 GWh 4% HEP Group c. 88 % electricity market share in Croatia Gas retail 77 GWh 6% Gas wholesale 3,353 GWh 8% Regional presence- 11.1% commercial customers in the Slovenian market % Compared to 1H 217 4

5 Key Facts Operating income HRK 7,573m 4% 3% Operating expenses HRK 6,192m Number of employees 1H 218: Adj. EBITDA HRK 2,372m 15% Net profit HRK 1,173m 13% Cash position HRK 2,98m 9% % Compared to 1H % 18% 1% Net debt HRK 1,15m Investments HRK 681m Total assets HRK 39,28m 5

6 Electricity Market in Croatia 1 GWh 12, 1, 8, 6, 2,362 1,6 8,9 1,719 8, ,13 1,239 8,938 HEP sale abroad HEP usage for transmission Losses on transmission and distribution Sale - others Total sale by HEP Group suppliers increased by 7.2% compared to the same period 217, an 13.7% increase in the sale to commercial customers. HEP sale 4, 6,497 6,643 7,121 Total electricity demand in Croatia 2, 1H 216 1H 217 1H HEP Group internal data 6

7 Contents 1H 218 Key highlights Operations results Financial results Q&A 7

8 Power Generation in 1H 218 GWh 8, 7, 6, 5, 4, 3, 2, 1, 1,235 1,516 1,473 1,349 1,616 2,38 4,42 3,518 2,398 1,342 1,258 1,291 1H 216 1H 217 1H 218 Heat NPP TPP HPP Compared to the year before HPP generation was 84% higher TPP generated 34% less electricity while NPP generation was 16% lower compared to the same period last year Generation of heat energy was 3% higher Electricity - installed capacity 1H Electricity generation 1H % 43% 4,536 MWe 49% HPP NPP TPP 18% 7,12 GWh 63% 8% 1 HEP Group internal data 8

9 Electricity Generation from HPP GWh HPP generation 1 5, 4, -32% 84% 4,42 3, 3,518 2, 2,398 1, 1H 216 1H 217 1H 218 1,4 1,2 1, Accumulation levels, GWh 1 ( ) GWh 5, 4,5 4, 3,5 3, HPP generation and Adj. EBITDA 2 correlation 2,87 2,637 HRK m 2,9 2,8 2,7 2,6 2,5 2, 1,5 1, 5 2,434 2,372 3,625 3,518 2,398 4,42 1H 215 1H 216 1H 217 1H 218 2,5 2,4 2,3 2,2 2,1 HPP Generation Adj. EBITDA 26 HPP operated 2,225 MWe total installed capacity Good hydrological conditions- 84% higher hydro power generation 1 HEP Group internal data 2 Adjusted EBITDA consists of operating profit/(loss) and depreciation and amortization for the period excluding financial expense, financial income, corporate income tax expense. 9

10 Electricity Generation from TPP GWh TPP generation 1 2,5 2, 2,38 26% -34% 1,5 1,616 1,349 1, 5 1H 216 1H 217 1H 218 TPP by fuel type, installed capacity 2 1% 5% Crude oil Coal 24% Gas Wood biomass 7% TPP fuel consumption 1 3,5 3,33 3, 2,5 2, 1,5 1, 2,238 2,678 Gas (GWh) Coal ( tons) Wood biomass ( tons) 7 TPP with total installed capacity of 1,946 MWe 2 34% lower generation All cogeneration plants have obtained environmental permits H 216 1H 217 1H HEP Group internal data 2 Total installed capacity at 1H218, HEP Group internal data 1

11 Transmission & Distribution GWh 13,5 12,5 11,5 1,5 9,5 8,5 7,5 6,5 Transmission volume 1 12,693 11,277 11,2 1H 216 1H 217 1H 218 GWh Transmission network losses 2.4% 2.4% 1.9% H 216 1H 217 1H 218 % of total 3.% 2.5% 2.% 1.5% 1.%.5%.% Losses in network % of total amount GWh 8,5 8,3 8,1 7,9 7,7 7,5 7,3 7,1 6,9 6,7 6,5 Distribution volume 1 8,17 8,251 7,842 1H 216 1H 217 1H 218 GWh Distribution network losses 8.1% 7.5% 6.9% H 216 1H 217 1H 218 % of total 8.2% 8.% 7.8% 7.6% 7.4% 7.2% 7.% 6.8% 6.6% 6.4% 6.2% Losses in network % of total amount 1 HEP Group internal data 11

12 Power Supply Electricity consumption 1H 218 per supplier 1 12% HEP Group Others 88% GWh Electricity sold by customer category, GWh 1 9, HEP Group supplies 88 % of all electricity sold in Croatia HEP Elektra supplies customers under public service obligation (universal service and guaranteed supply) while HEP-Supply supplies all other customers that have opted for a market supplier HEP Supply is the largest non-tariff supplier among 16 others 2 in Croatia HEP Supply supplies c. 85% of commercial customers in the Croatian market 2 In the first six months of 218, HEP Supply continued its presence in the region and remained 11.1% of commercial customers in the Slovenian market 8, 7, 6, 5, 4, 3, 2, 1, 1,13 1, ,788 2,829 3,47 3, ,775 3,995 Others with market supply (commercial and households) HEP Guaranteed supply - Commercial HEP Universal service - Households HEP market supply (commercial and households) Gas Wholesale in Croatia 1 Others 55% HEP 45% Gas Retail in Croatia 1 Others 88% HEP 12% 1H 216 1H 217 1H HEP Group internal data 2 electricity sold, as of 1H 218, 12

13 Contents 1H 218 Key highlights Operations results Financial results Q&A 13

14 Development of Operating Income 1 Operating income 1H 217 Electricity sale Thermal power sale Wholesale gas 7, HRK m Revenue from electricity sale increased by HRK 123,6m (2%), which is a result of: 2.4% increased demand 7% increased share in the sale to commercial customers 3.5% lower thermal power sales revenue due to 4.2% consumption decrease Sale of gas increased mainly due to start of supply of Petrokemija and trading on power exchanges Retail gas +313 Other operating income decreased by HRK m as a result of absence revenue from cancelling asset impairment. Other income -671 Operating income 1H 218 7,573 1 Unaudited Financial Statements for 1H 218, available at 14

15 Financial Performance 1H 218 HRK m Operating income and expenses 1 9, 8, 7, 6, 5, 4, 3, 2, 1, - 7,174 5,421 9% 11% -4% 3% 7,848 7,573 5,997 6,192 1H 216 1H 217 1H 218 Operating income Operating expenses Total operating income split H1 218 vs H Adj. Ebitda 1H 216² Total operating income Electricity purchase cost Fuel cost Costs of gas sold Staff cost Other Costs³ Depreciation Adj. Ebitda 1H 217² Total operating income Electricity purchase cost Fuel cost Costs of gas sold Staff cost Other Costs³ Depreciation Adj. Ebitda 1H 218² , Total operating expenses split 1H 218 vs 1H , ,87 HRK m 673 7% 5% 7% 14% 2% 5% 7% 5% 1H % 76% 1H 218 Revenue from elecitrity sales Revenue from thermal sales Revenue from sale of gas on wholesale market Revenue from sale of gas to customers Other operating income 23% 19% 2% 2% 1H % 18% 16% 16% 1% 15% 15% 1H % Electricity purchase cost Fuel cost Costs of gas sold Staff cost Depreciation and amortization costs Other operating expenses 1 Unaudited Financial Statements for 1H 218, available at 2 Adjusted EBITDA consists of operating profit/(loss) and depreciation and amortization for the period excluding financial expense, financial income, corporate income tax expense 3 15 Includes depreciation and amortization

16 Cash flow 1 Cash at FY 216 3,19 HRK m Net cash from operations 1,282 Strong liquidity position Net cash from investing Net cash from financing activities Cash at 1H 217 Net cash from operations Net cash from investing ,214-1,527 1,878 Additional liquidity HRK 1 billion under short term financing sources with local banks Continuous capital expenditures KKE EL-TO Zagreb Unit L modernization and revitalization of distribution and district heating network smart meters Net cash from financing activities -1,548 Cash at FY 217 2,17 Net cash from operations 1,76 Net cash from investing -681 Net cash from financing activities -188 Cash at 1H 218 2,98 1 Unaudited Financial Statements for 1H 218, available at 16

17 HEP Group Debt HRK m Net debt/adj. EBITDA ratio development 1 3, 2, ,637 Net Debt.9 2,5 2,292 2,372.9x.8 Adj. EBITDA² 2,.7 1,734.6 Net Debt/ Adj. 1,5.6x.5 EBITDA² 1, 1,15.5x H 216 1H 217 1H HRK m Debt maturity profile 1 4, 3,5 Bonds 3, Loans 2,5 2, 3,537 1,5 1, Credit Rating Agency Issue date Standard & Poor's 21 December 216 Rating BB/Stable SACP bb No short term debt since YE 214 Experienced issuer on domestic and international capital market (first Croatian Tender Offer and Liability Management Transaction in 215) Moody's 14 March 217 Ba2/Stable outlook 1 Unaudited Financial Statements for 1H 218, available at 2 Adjusted EBITDA consists of operating profit/(loss) and depreciation and amortization for the period excluding financial expense, financial income, corporate income tax expense 17

18 Contents 1H 218 Key highlights Operations results Financial results Q&A 18

19 Q&A Contacts for Institutional Investors & Financial Analysts Marko Ćosić Board Member and CFO Alina Kosek Finance and Treasury Director Ivana Sučić Funko Head of Investor Relations Ivan Dodig Investor Relations marko.cosic@hep.hr alina.kosek@hep.hr ivana.sucicfunko@hep.hr ivan.dodig@hep.hr 19

20 Disclaimer This presentation contains information relating HEP Group ("HEP") that must not be relied upon for any purpose and may not be redistributed, reproduced, published, or passed on to any other person or used in whole or in part for any other purpose. By accessing this document you agree to abide by the limitations set out in this document as well as any limitations set out on the webpage of HEP on which this presentation has been made available. This document is being presented solely for informational purposes. It should not be treated as giving investment advice, nor is it intended to provide the basis for any evaluation or any securities and should not be considered as a recommendation that any person should purchase any securities. This presentation may contain forward-looking statements based on current assumptions and forecasts made by HEP management and other information currently available to HEP. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here. HEP does not intend, and does not assume any liability whatsoever, to update these forwardlooking statements or to conform them to future events or developments. Neither HEP nor any respective partners of HEP undertake any obligation to provide the recipient with access to any additional information or to update this presentation or any information or to correct any inaccuracies in any such information. Certain numerical data, financial information and market data (including percentages) in this presentation have been rounded according to established commercial standards. As a result, the aggregate amounts (sum totals or interim totals or differences or if numbers are put in relation) in this presentation may not correspond in all cases to the amounts contained in the underlying (unrounded) figures appearing in the consolidated financial statements. Furthermore, in tables and charts, these rounded figures may not add up exactly to the totals contained in the respective tables and charts. 2