Presentation of the Company‘s Performance and Results 9 Months of 2017 Lietuvos Energijos Gamyba, AB (LEG) Eglė Čiužaitė 17/11/2017 Vilnius
Table of Contents About the Company Overview of 9 months of 2017: The most important events Trade and commodities market overview LEG production amounts LEG financial results Achievements and plans during H2 2017 Your questions Presented by Moderated by Planned duration: 20 minutes + Your questions EGLĖ ČIUŽAITĖ VALENTAS NEVIERA Chairwoman of the Board Head of Communication and CEO 2
LEG provides services that are necessary for the energy system security ELEKTRĖNAI COMPLEX KRUONIS PSHP KAUNAS A. BRAZAUSKAS HPP Production of electricity and heat Commercial production of electricity Commercial production of electricity System services System services (main – tertiary reserve), System services (main – secondary reserve) strategic reserve Capitalization Minority shareholders Shareholder structure 30/09/2017 – approximately 96.75% - Lietuvos Energija, UAB € 406 5 900 LE 3.25% - minority shareholders million 3
The most important events of Q3 2017 5 10 13 July August September A loan refinancing agreement of Two members of the Supervisory Annual emissions monitoring tests up to € 60 million was concluded, Board were elected for a new in Elektrėnai Complex were LEG assets are no longer pledged 4-year term of office completed as collateral 12 22 29 September September September LEG assessed the technical The shareholders approved the LEG board was re-elected for a condition of Vilnius Power Plant-3 payment of € 10.8 million of new 4-year term of office and submitted a report to LE dividends for H1 2017 4
Trade and commodities market overview Electricity balance in Lithuania Wholesale electricity price in NP Lithuania 100% Other 60 2016 9M/2017 9M -1,9% % of full demand 80% Peak Wind PP € /MWh (6-22 h) 60% Kaunas A. Brazauskas 40 Off-peak HPP 40% 77% 75% (22-6 h) Kruonis PSHP 20% Elektrėnai Complex NP LT price 20 (0-24 h) 0% 1 3 5 7 9 11 1 3 5 7 9 Import 2016 9M 2017 9M 2016 2017 Purchase price of gas Price of CO2 emission allowances (EUA) 30 8 2016 9M/2017 9M -0,4% 30/9/2016 / 30/9/2017 +42,1% € /MWhA € /t CO2 20 6 10 4 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 2016 2017 2016 2017 Source: Energijos tiekimas , Nord Pool, Company‘s accounting information, Platts Remark: gas price – without taxes for user capabilities and without constituent for security of LNGT 5
More production at Kaunas HPP in 9M 2017, 13% less of total generated electricity Production of LEG power plants, GWh Total: 404 450 Total: 411 (-2%) 400 Total: 318 350 140 (+23%) Total: 308 176 300 Total: 257 77 250 145 54 118 200 109 Total: 129 124 85 (-58%) 150 50 100 129 153 132 118 104 50 73 34 6 0 Elektrėnų kompleksas Kruonio HAE Kauno A. Brazausko HE Elektrėnai Complex Kruonis PSHP Kaunas A. Elektrėnai Complex Kruonis PSHP Kaunas A. Brazauskas HPP Brazauskas HPP 2016 2016 2017 I ketv. II ketv. Q1 Q2 Q3 Q1 Q2 Q3 6
Decrease in revenue – in line with effective cost control LEG revenue Total: € 121.3 MLN 2016 9M 50.7 2.9 32.1 15.1 20.5 Total: € 97.6 MLN (-20%) 2017 9M 41.4 2.7 30.1 22.5 0 25 50 75 100 125 € MLN Revenue of sales of electricity energy and related services Revenue of sales of heat production Revenue of sales of capacity reserve services Subsidies for strategic reserve Revenue from other operations LEG expenses Total: € 92.4 MLN 2016 9M 19.7 37.6 15.4 5.5 3.3 5.3 4.2 Total: € 77.4 MLN (-16%) 2017 9M 19.5 25.3 18.7 5.8 -1.3 4.1 5.5 -5 20 45 70 95 € MLN Purchases of electricity or related services Gas, biomass and heavy fuel expenses Depreciation and amortisation Wages and salaries and related expenses Repair and maintenance expenses Emission allowance revaluation expenses Reversal of impairment of other non-current assets Other expenses 7
Profitability of main activities increased EBITDA and EBITDA margin Net profit 50 50 25 38.8 40 39.3 20 17.2 13.7 30 € MLN 31.0 15 25 % € MLN 12.9 20 22.0 10 19.7 24.7 18.2 10 14.4 12.2 5 0 0 2016 9M 2017 9M Commercial activities 0 Impact of regulators decisions 2016 9M 2017 9M Regulated activities Net profit EBITDA margin Net profit after the elimination of one-off factors and EUA EBITDA margin considering the impact of Regulator decisions market price change 8
Achievements and plans during H2 2017 Changes in management bodies Two members of the Supervisory Board An independent member of the Supervisory Board: were elected for a new 4-year term of Supervisory Board is being selected (the office selection started on 15 November) A new LEG board and CEO were elected Board: for a new term of office Projects and research The wind farm project in We are waiting for policy regarding the Preparatory work is done Kruonis PSHP: support schemes of RES development The project to install the An application was submitted to get EU We are waiting for regional decisions fifth unit in the Kruonis funding for the research on poles and regarding the selected synchronisation PSHP: infrastructure model The assessment of the technical condition Other projects: of Vilnius Power Plant-3 is complete 9
Achievements and plans during H2 2017 Production Compulsory testing of the units is complete (Q3) An investment into optimising the CCU operation was made (Q3) The scheduled check of the CCU and technical maintenance works were performed (Q4) Higher YOY generation by hydroelectric Higher YOY generation by hydroelectric power plants during Q3 power plants during Q4 Reserves services 2018 There are no final decisions regarding Preliminary results of the tertiary power reserves (tertiary and strategic) for 2018 reserve auction were announced yet 10
Thank You. Your questions? 11
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