Societatea Energetica Electrica S.a. · BVB:EL
Societatea Energetica Electrica — Electrica — WOOD's EM Energy & Commodities Conference 2021
58 slides from Societatea Energetica Electrica's conference presentation, Apr 13, 2021
Slide 1: Presentation of 2020 financial results
Presentation of 2020 financial results WOOD's EM Energy & Commodities Conference Bucharest, 13 April 2021
Slide 2: Content
Content 1 2020 Financial results ▪ Key Group Information ▪ Distribution Segment Overview ▪ Supply Segment Overview ▪ COVID-19 Impact on Group’s Activities 2 2021 Budgets 3 Main Corporate Events 4 Status of Group’s Strategy Implementation 5 Appendices 2
Slide 3: Summary Consolidated Financials
Summary Consolidated Financials Key Group Information Revenues EBITDA Growth and Margin Performance (RON mn) EBITDA (RON mn) and EBITDA Margin (%) 6,280 6,501 1,200 25.00% 557 518 1,000 14.66% 20.00% 15.00% 11.44% 800 10.10% 7.18% 10.00% 600 5,762 5,944 5.00% 1,672 1,725 953 400 718 0.00% 133 148 20
Slide 4: Consolidated EBITDA and net result evolution
Consolidated EBITDA and net result evolution Key Group Information EBITDA (RON mn) Comments The consolidated EBITDA variation 2020 vs. 2019 is RON +235 mn, being mostly the cumulated effect of: ❑ The positive variation of the energy margin RON +255 mn, thereof: • RON +61 mn from the distribution seg
Slide 5: Distribution operators - highlights
Distribution operators - highlights Distribution segment overview Key figures 2020 Financial results EBITDA for the distribution segment (as at 31.12.2.2020 the 3 DSOs were merged into a single subsidiary) increased by RON 16.6 mn (+2.7%), mainly due to the evolution of: ~3.80 million ▲ revenues: RO
Slide 6: Financial impact of COVID-19 on distribution companies
Distribution segment – COVID-19 impact The financial impact of the COVID 19 pandemic on distribution companies Evolution of the cost of electricity needed to cover NL Network losses ❑ In 2020, the cost of electricity needed to cover NL was by RON 27.9 mn higher than in 2019, but by RON 13.4 mn below
Slide 7: FISE Electrica Serv
FISE Electrica Serv Distribution segment overview General overview Revenues Electrica Serv, a wholly-owned subsidiary of ELSA, provides repair and other energy ancillary (RON mn) services to third parties and various services to the companies within the group (vehicles rental, building rental etc.).
Slide 8: Supply market
Supply market Overall Market Share – November 2020 Supply segment overview Key Facts Electrica Furnizare 19.24% The supply market consisted of regulated and competitive segments: • The regulated segment comprised 5 bound suppliers of last resort (SoLR), integrated within the same group as the corres
Slide 9: Supply segment – Electrica Furnizare
Supply segment – Electrica Furnizare Supply segment overview Key figures (2020) Financial results Coverage EBITDA significantly increased by RON 126.4 mn compared to 2019, mainly following the evolution of the below factors: ~3.6 mn ▲ revenues increase of RON 246.5 mn, mainly as a result of the elec
Slide 10: Supply - key aspects
Supply- key aspects Supply segment overview Volume of Electricity Supplied on Retail Market Number of consumption places (‘000’s) (TWh) Competitive Regulated Competitive Regulated 9.2 9.3 3,541 3,553 3,583 8.5 253 269 314 4.4 4.2 3.7 3,288 3,284 3,269 4.9 4.9 5.1 2018 2019 2020 2018 2019 2020 Consum
Slide 11: Financial impact of COVID-19 on supply company (1/2)
Supply segment – COVID-19 impact The financial impact of the COVID 19 pandemic on supply company (1/2) ❑ The COVID 19 pandemic influenced the consumption trend at European and local level; nevertheless, on the supply segment it was recorded only a slight electricity volume decrease, of -0.1%, compar
Slide 12: Financial impact of COVID-19 on supply company (2/2)
Supply segment – COVID-19 impact The financial impact of the COVID 19 pandemic on supply company (2/2) Receivables’ analysis ❑ Regarding the postponement of the payment of electricity and natural gas bills, GEO no. 29/2020 for SMEs remains applicable. Based on this, until 31 December 2020, state of
Slide 13: Group liquidity
Supply segment – COVID-19 impact Group liquidity ❑ At Group level, the total liquidity available in the form of cash and overdraft limits as of 31 December 2020 was RON 1,196 mn. Without considering the overdraft line of RON 210 mn contracted in January 2020, related to the master accounts of the li
Slide 14: Consolidated budget 2021 (RON mn) – IFRS values
2021 Budget Consolidated budget 2021 (RON mn) – IFRS values The significant variances are detailed below: Budget B2021 vs. B2021 vs. Indicator Actual 2020 2021 A2020 A2020 % 1. The revenues’ increase of RON 389.1 mn is the net effect of: Revenue 6,501.1 6,890.2 389.1 6.0% Other income 165.4 158.3 (7
Slide 15: 2021 Budget – Distributie Energie Electrica Romania (DEER)
2021 Budget 2021 Budget – Distributie Energie Electrica Romania (DEER) Whilst the three distribution subsidiaries merged on 31.12.2020, the budgeting was done at each geographical region level, considering that for the next three years of the fourth regulatory period, the tariffs; approval and ANRE
Slide 16: 2021 Budget vs Actual 2020 – DEER
2021 Budget 2021 Budget vs Actual 2020 – DEER Actual 2020 Budget 2021 B2021 vs. B2021 vs. RON mn SDTN SDTS SDMN Adjustments TN TS MN 3DSO DEER A2020 A2020 % Revenues from distributed energy 629.7 614.2 647.1 - 1,890.9 2,006.1 646.5 673.1 686.5 115.1 6.1% Other energy revenues 37.8 37.0 55.2 - 130.1
Slide 17: 2021 Consolidated budget – Electricity supply and production segment
2021 Budget 2021 Consolidated budget – Electricity supply and electricity production segment Assumption electricity – ▪ The sales forecasts for the regulated segment were established based on the consumption history for the clients in the portfolio; Universal ▪ 2021 sales forecast for this category
Slide 18: 2021 Budget vs. Actual 2020 – EFSA & EEV1
2021 Budget 2021 Budget vs. Actual 2020 – EFSA & EEV1 Actual 2020, out Budget 2021, out B2021 vs. B2021 vs. A2020 RON mn EFSA EEV1 EFSA EEV1 of which: of which: A2020 [%] Electricity and gas revenues 4,493.5 4,491.6 1.9 4,792.6 4,789.4 3.2 299.3 6.7% Electricity and gas purchase (3,984.9) (3,984.6)
Slide 19: Dividend distribution
Dividend distribution Dividends Distributed gross dividends (FY 2014 - 2020) (RON mn) Gross dividend per share (RON) and Dividend yield(1) (%) 291.6 6.9% 7.3% 6.9% 244.7 251.4 245.4 247.5 246.1 247.9 6.8% 5.2% 6.1% 0.8600 5.3% 0.7217 0.7415 0.7237 0.7300 0.7248 0.7300 2014 2015 2016 2017 2018 2019 2
Slide 20: Status of Group's Strategy Implementation (1/2)
Status of Group’s Strategy Implementation Electrica Group has made significant steps in implementing the strategy for the period 2019-2023 (1/2) I Expanding in related fields • Inorganic growth – the first acquisition • Organic growth – continues the efforts to and obtaining synergies finalized in 2
Slide 21: Status of Group's Strategy Implementation (2/2)
Status of Group’s Strategy Implementation Electrica Group has made significant steps in implementing the strategy for the period 2019-2023 (2/2) III Continuing investments to improve the reliability of • Electrica Group continues investments in the modernization and development of distribution netwo
Slide 22: Main events in Q4 2020 and up to date
Main events in T4 2020 and up to date Main Corporate Events ELSA’s General Meetings of Shareholders: ❑ Annual OGMS convened for 28 April 2021 – approval of 2020 individual and consolidated financial statements; approval of 2021 individual and consolidated budget; approval of the proposed distributio
Slide 23: Appendices
Appendices Curectrica 23
Slide 24: Group structure
Group structure Electrica Group is the only Romanian group listed on the BSE & LSE and operates within distribution, supply & energy service segments Distributie Energie Electrica 100 % 99.99 %2) Electrica Furnizare S.A. Romania S.A. Distribution Operator Electricity and natural gas HQ: Cluj-Napoca
Slide 25: SDTN
SDTN Distribution segment overview Key figures 2020 Financial results EBITDA is lower by RON 2.0 mn (0.9%) y-o-y, mainly due to the evolution of: ▲ energy revenues: RON +29.9 mn (+4.6%), from the positive evolution of the distribution tariffs and ~1.31 mn the rise in the volume of electricity distri
Slide 26: SDTN (Cont'd)
SDTN (Cont’d) Distribution segment overview Network losses cost Network losses Network losses (RON mn) (GWh) (%) 204 194 613 619 9.86% 9.86% 9.94%** 9.56% 9.88% 9.72% 53 59 167 167 Reg. Realized Reg. Realized Reg. Realized 2019 Q4 2019 2020 Q4 2020 2019 Q4 2019 2020 Q4 2020 2018 2019 2020 Capital ex
Slide 27: SDTS
SDTS Distribution segment overview Key figures 2020 Financial results EBITDA is higher by RON 16.7 mn (+9.5%), mainly due to the evolution of the following elements: ~1.17 million ▲ energy revenues: +RON 2.4 mn (0.4%), from the reactive energy revenues increase; users ▼ NL costs: RON -6.2 mn, being
Slide 28: SDTS (Cont'd)
SDTS (Cont’d) Distribution segment overview Network losses cost Network losses Network losses (RON mn) (GWh) (%) 223 703 693 217 10.17% 10.08% 9.40%** 9.61% 9.18% 9.63% 71 72 220 226 Reg. Realized Reg. Realized Reg. Realized 2019 Q4 2019 2020 Q4 2020 2019 Q4 2019 2020 Q4 2020 2018 2019 2020 Capital
Slide 29: SDMN
SDMN Distribution segment overview Key figures 2020 Financial results EBITDA increase of RON 42.9 mn, or 29.9% compared to 2019, mainly due to: ▲ energy revenues: +RON 57.1 mn (+8.8%), mainly due to the positive evolution of distribution ~1.32 million tariffs and the 2.7% distributed electricity vol
Slide 30: SDMN (Cont'd)
SDMN (Cont’d) Distribution segment overview Network losses cost Network losses Network losses (RON mn) (GWh) (%) 273 802 789 249 11.71% 10.92%** 10.91% 10.63% 10.84% 9.16% 92 77 233 236 Reg. Realized Reg. Realized Reg. Realized 2019 Q4 2019 2020 Q4 2020 2019 Q4 2019 2020 Q4 2020 2018 2019 2020 Capit
Slide 31: 2021 Budget vs Actual 2020 – TN
2021 Budget 2021 Budget vs Actual 2020 – TN The most significant variations as compared with 2020, refer to: B2021 vs. B2021 vs. ▪ Revenues from distributed energy - positive variation of RON 16.8 mn, mainly RON mn A2020 B2021 A2020 [Abs.] A2020 [%] from the impact of the distribution tariff’s incre
Slide 32: 2021 Budget vs Actual 2020 – TS
2021 Budget 2021 Budget vs Actual 2020 – TS B2021 vs. B2021 vs. The most significant variations as compared with 2020, refer to: RON mn A2020 B2021 A2020 [Abs.] A2020 [%] Revenues from distributed energy 614.2 673.1 58.9 9.6% ▪ Revenues from distributed energy - positive variation of RON 58.9 mn, Ot
Slide 33: 2021 Budget vs Actual 2020 – MN
2021 Budget 2021 Budget vs Actual 2020 – MN B2021 vs. B2021 vs. The most significant variations as compared with 2020, refer to: RON mn A2020 B2021 A2020 [Abs.] A2020 [%] Revenues from distributed energy 647.1 686.5 39.4 6.1% ▪ Revenues from distributed energy - positive variation of RON 39.4 mn, Ot
Slide 34: Important Regulatory Changes – Distribution Activity (1/4)
Important Regulatory Changes – Distribution Activity (1/4) ❑ RP4 Regulations on Distribution tariffs • ANRE approved Order no. 75 of 6 May 2020, which established a regulated rate of return (RRR) for electricity and gas, distribution and transmission of 6.39% for the existing BAR, until the end of t
Slide 35: Important Regulatory Changes – Distribution Activity (2/4)
Important Regulatory Changes – Distribution Activity (2/4) ❑ Law no. 155/24 July 2020 entered into force on 30 July 2020 and amended the Energy Law no. 123/2012: • Licenses - the situations in which the distribution service can be done without a license are defined; the concessionaire DSO has the ri
Slide 36: Important Regulatory Changes – Distribution Activity (3/4)
Important Regulatory Changes – Distribution Activity (3/4) ❑ ANRE amended and completed the regulations for the alignment with the EU Regulations on: • program for implementing the measures for ensuring the settlement conditions at an interval of 15 minutes - ANRE Order no. 63/2020 • possibility of
Slide 37: Important Regulatory Changes – Distribution Activity (4/4)
Important Regulatory Changes – Distribution Activity (4/4) ❑ Law no. 290/2020 - amends the Energy Law - in force starting with 19 December 2020 • The obligation for the financing by the DO of the connection works of the domestic clients, provided by Art. 51 (3 ^ 5) and the recovery of the connection
Slide 38: Changes in Distribution Regulation - RP4
Changes in Distribution Regulation - RP4 Regulated Revenue and tariff calculation 1 2 3 4 5 6 7 8 7 Regulated Revenue Reactive en. Regulated Contr. Non- Tariff NL Cost Depreciation RRR2 & 95% profit Revenue OPEX1 controllable other activ. 9 Forecasted Volume OPEX 1 • The starting point is approved b
Slide 39: Changes in Distribution Regulation
Changes in Distribution Regulation Methodology for determining distribution tariffs - Summary RP4 vs RP3 RP3 RP4 1 RRR January 2019: 5.66% existing RAB & 1% incentive RP4 network invest.(acc. ANRE) Return RRR (7.7%) applied to RAB 29 March 2019–30 April 2020: 6.9% total BAR (acc. GEO 19/2019 & GEO 1
Slide 40: Methodology for determining distribution tariffs – RAB & Investment
Changes in Distribution Regulation Methodology for determining distribution tariffs – Comparative elements RP4 vs RP3 RAB & Investment RP3 methodology RP4 methodology 1. RAB includes: assets used for the distribution service, which are recorded into the DSOs accounts as tangible assets and are physi
Slide 41: Methodology for determining distribution tariffs – Opex & NL
Changes in Distribution Regulation Methodology for determining distribution tariffs – Comparative elements RP4 vs RP3 Opex & NL RP3 methodology RP4 methodology Controlable OPEX 1. OpexC 2019 is established based on formula (approved 1. OpexC 2019 is not established based on formulae, but by comparat
Slide 42: Supply Regulation Area – Primary Legislation – 1/2
Supply Regulation Area – Primary Legislation – 1/2 GEO no. 1/2020 on some fiscal-budgetary measures and for amending and supplementing some normative acts (including GEO no. 114/2018): - until 31 December 2020, for household customers the supply of electricity is carried out under conditions regulat
Slide 43: Supply Regulation Area – Primary Legislation – 2/2
Supply Regulation Area – Primary Legislation – 2/2 GEO no. 106/2020 for amending and supplementing the law on electricity and natural gas no. 123/2012 and other legislation: - natural gas suppliers have the obligation to purchase the natural gas they supply to domestic customers, under the condition
Slide 44: Supply Regulation Area – Secondary Legislation – 1/6
Supply Regulation Area – Secondary Legislation – 1/6 ANRE Order no. 1/2020 on approval of tariffs and monetary contributions levied by ANRE in 2020 - following GEO no. 1/2020, the responsibility for establishing the values of contributions due to ANRE reverted to ANRE ANRE Order no. 12/2020 on amen
Slide 45: Supply Regulation Area – Secondary Legislation – 2/6
Supply Regulation Area – Secondary Legislation – 2/6 ANRE Order no. 73/2020 amending ANRE Order no. 189/2018 annex regarding the obligation to inform final customers through the online application "Offers comparator - electricity supply type“ - ANRE web application "Offers comparison - electricity s
Slide 46: Supply Regulation Area – Secondary Legislation – 3/6
Supply Regulation Area – Secondary Legislation – 3/6 ANRE Order no. 144/2020 on the obligation of participants in the natural gas market to offer on the centralized markets: - the obligation to offer, as a seller, by applying a percentage of 40% to the quantity of natural gas for which the participa
Slide 47: Supply Regulation Area – Secondary Legislation – 4/6
Supply Regulation Area – Secondary Legislation – 4/6 ANRE Order no. 173/2020 approving the Regulation on the supply of natural gas as a last resort - at least three SoLR of natural gas are designated at national level, in compliance with some eligibility conditions; - the takeover period: three mont
Slide 48: Supply Regulation Area – Secondary Legislation – 5/6
Supply Regulation Area – Secondary Legislation – 5/6 ANRE Order no. 213/2020 approving the Regulation for calculating and settling imbalances of the parties responsible for balancing - single imbalance price and for amending some orders of the president of the National Energy Regulatory Authority -
Slide 49: Supply Regulation Area – Secondary Legislation – 6/6
Supply Regulation Area – Secondary Legislation – 6/6 ANRE Order no. 239/2020 for the amendment of ANRE Order no. 123/2017 regarding the approval of the contribution for high efficiency cogeneration and of some provisions regarding its invoicing method - the value of the contribution for cogeneration
Slide 50: Leading Player in Distribution and Supply
Leading Player in Distribution and Supply according to ANRE’s most recent annual report Distribution Supply Volumes Distributed in 2019 Volumes Supplied in 2019 13.1% 18.7% SDMN SDTS 13.9% SDTN Electrica Furnizare 44.9 TWh Others 49.5 TWh Others 60.6% 12.4% 81.3% Electrica: 39.4% Regulated Market Sa
Slide 51: Corporate Governance Bodies
Corporate Governance Bodies • Mr. Iulian Cristian Bosoanca – Chair • Ms. Ramona Ungur Board of Directors • Mr. Dragos Andrei Current • Mr. Radu Florescu Composition • Mr. Bogdan George Iliescu • Mr. Gicu Iorga • Mr. Valentin Radu • All board members are non-executive, elected in accordance with the
Slide 52: Shareholder Structure at 31 December 2020
Shareholder Structure at 31 December 2020 Percent of share Shares with voting Shareholder Shares capital right Romanian State through the Ministry for Economy, Energy 169,046,299 48.7948% 49.7850% and Business Environment EBRD 17,355,272 5.0096% 5.1112% Electrica 6,890,593 1.9890% 0% Bank of New Yor
Slide 53: Monthly volume and average price of Electrica's shares and GDRs
Monthly volume and average price of Electrica’s shares and GDRs 30,089,933 14 2,906,873 13 2,730,355 12 11 2,281,172 2,199,260 10 2,114,286 9 1,796,076 1,755,148 8 1,578,892 1,550,993 7 1,389,465 1,342,460 1,344,710 6 991,375 5 4 3 2 104,760 90,772 99,896 1 2,756 2,800 14,532 26,808 4,400 11,600 17,
Slide 54: Electrica's adjusted closing price vs BET-TR
Electrica’s adjusted closing price vs BET-TR (January 2020 – 26 February 2021) 40.00 30.00 EL: 37.79% BET-TR: 7.58% 20.00 10.00 0.00 -10.00 -20.00 -30.00 BET-TR Electrica's price adjusted with dividends Source: Company data; BSE 54
Slide 55: Glossary
Glossary LV Low Voltage AMR Automatic Meter Reading MP Merger Plan ANRE Romanian Energy Regulatory Authority MV Medium Voltage B2B Business to Business MWh MegaWatt hour B2C Business to Consumer NBV Net Book Value BET-TR Bucharest Exchange Trading - Total Return Index NL Network Losses BoD Board of
Slide 56: 2021 Financial Calendar
2021 Financial Calendar • 26 February Publication of the 2020 financial annual consolidated and individual preliminary results • 5 March Publication of the 2020 financial annual results - documents for the Ordinary General Meeting of Shareholders • 8 March Investor and analyst teleconference for 202
Slide 57: Investor Relations & Disclaimer
Investor Relations & Disclaimer • Email: ir@electrica.ro • Web: https://www.electrica.ro/en/investors/ Investor Relations • Tel: +40 (0)21.208.50.35 • Address: 9 Grigore Alexandrescu Str., 1st District, Bucharest, 010621 This document was prepared by Electrica for the presentation of 2020 financial
Slide 58: Q&A
Q&A 58
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