Key financial data

Sales revenue

TAURON Group posted sales revenue of PLN 19.1bn in 2013, i.e. a 22.7 percent decline year-on-year. The primary reason for falling revenue is a change of the model employed to trade electricity generated by the Group. In 2012 most of electricity was sold via the Polish Power Exchange, meanwhile in 2013 electricity sales outside the Group were significantly reduced in favor of direct sales between the Group’s subsidiaries that are subject to exclusion from consolidation.

Increased revenues were reported by Heat (up by 4.6 percent) and Customer Service (up by 45.5 percent). Mining’s revenue dropped due to lower hard coal prices. A decline was also observed in the Generation segment (as a result of a lack of compensations due to the termination of the so-called Long Term Power Purchase Contracts and lower sales prices of electricity and color certificates). Revenues close to 2012 levels were posted by the following segments: Distribution, Supply and RES.

Sales revenue

 201120122013
PLN bn 20.7 24.8 19.1

sales revenue

EBITDA

TAURON Group’s reported EBITDA (EBIT plus depreciation) reached PLN 3.66bn in 2013 versus PLN 3.85bn in 2012. However, it is important to note that, had it not been for one-off events (impairment charges related to generation assets and color certificates, provision for the shortage of CO2 emission allowances), EBITDA would have reached PLN 4.27bn which means a surge, versus the adjusted – comparable – 2012 EBITDA, of almost 30 percent.

As the company’s scale of operations grew the EBITDA margin increased, reaching 19.1 percent in 2013 versus 15.6 percent in 2012. EBITDA rose in most of the Group’s lines of business. In percentage terms the biggest gains were observed in Supply (EBITDA surged 88 percent) and Distribution (EBITDA rose 13 percent). Generation was the only segment that reported a substantial drop of EBITDA year-on-year. The main reasons for the deterioration of the results are one–off events such as impairment charges related to generation assets and color certificates, provision for the shortage of CO2 emission allowances and no revenue related to compensations due to the termination of Long Term Power Purchase Contracts.

EBITDA 

 201120122013
PLN bn 3.06 3.85 3.66

ebitda

Net profit

TAURON Group’s 2013 net profit reached PLN 1.35bn and it was approx. 13 percent lower than a year earlier. 97 percent of the 2013 net profit was attributed to the shareholders of the holding company – TAURON Polska Energia SA.

TAURON Group’s net profit

 201120122013
PLN bn 1.27 1.55 1.35

net profit

Balance sheet AND CAPITAL EXPENDITURE

TAURON Group’s balance sheet total at the end of December 2013 was PLN 32.4bn versus PLN 31.3bn at the end of 2012, i.e. an increase by more than 3 percent. TAURON Group’s 2013 CAPEX reached PLN 3.78bn and it was approx. 9 percent higher than in 2012. Higher CAPEX was mainly due to accelerating strategic investments in the following lines of business: Generation, Heat, RES and Distribution.

Debt

At the end of December 2013 TAURON Group’s net financial debt reached approximately PLN 5.23bn versus roughly PLN 4.54bn at the end of December 2012. The net debt to EBITDA ratio also rose slightly – to 1.43 from 1.18 in 2012. It should be emphasized that the leverage ratio still remains at a very safe level.

Cash flow

Total net cash flow from TAURON Group’s operating, investing and financing activities was negative and reached (PLN 350.5m) in 2013 versus the positive cash flow of PLN 385.8m in 2012.

Cash flow from operating activities was approx. PLN 4.1bn, while cash flow from investing activities was negative (PLN 4,2bn) due to the CAPEX program underway.

The nature of cash flow streams indicates the company’s expansion in progress – capital expenditures incurred are financed from operating cash flow and external sources of financing.

Bond issue program

TAURON Polska Energia signed a bond issue program agreement with a group of banks for up to PLN 5bn in July 2013. The term of the agreement is three years and the funds acquired from the bonds will be used to finance TAURON Group’s CAPEX program. Also in July 2013 the company signed long term PLN 1bn bond issue program agreements with Bank Gospodarstwa Krajowego. As of December 31, 2013 funds available under bond issue programs amounted to PLN 3.75bn.

As of the end of 2013 TAURON’s total debt due to bonds issued was PLN 4.3bn. The overwhelming majority of this amount came from bonds issued in December 2011 for the total value of PLN 3.3bn to finance the acquisition of Górnośląski Zakład Elektroenergetyczny (GZE) from Vattenfall AB.

Rating

TAURON Polska Energia has a credit rating assigned by an international rating agency Fitch Ratings. In June 2013 Fitch reaffirmed the company’s BBB rating in domestic and foreign currencies with a stable outlook. According to Fitch the rating affirmation reflects TAURON Group’s leading position in electricity distribution and strong position in generation.