Centrenergo reports expectedly weak 1H14 financials

Centrenergo reports expectedly weak 1H14 financials



7 серпня 2014 года
Конкорд Капитал

Центрэнерго (CEEN)


State-controlled power GenCo Centrenergo (CEEN UK) reported a 2% yoy increase in net revenue to UAH 3.70 bln in 1H14. Its power output in the period increased 8% yoy to 7.3 TWh, while the average achieved electricity rate fell 6% yoy. Lower rates and increased costs resulted in a 2.8x yoy decrease of the company’s EBITDA to UAH 184 mln in 1H14. The company’s bottom line fell 5.6x yoy to UAH 76 mln.



In 2Q14 alone, the company increased its power output 40% yoy to 3.7 TWh (mainly due to the restart of the Vuhlehirska thermal power plant (TPP), which was idle in 2Q13 due to fire damage), while its revenue increased just 16% yoy to UAH 1.95 bln. Centrenergo’s quarterly EBITDA amounted to UAH 121 mln, which is 3.3x smaller yoy but 2x better qoq.



Alexander Paraschiy: The company’s results for the quarter were broadly expected, given the decline in average electricity rates granted by the state to power GenCos in 1H14, as well as a lack of any special tariff markup that Centrenergo received in 2Q13 to finance repairs and operating costs at the damaged Vuhlehirska TPP.



The third quarter promises no improvements in Centrenergo’s P&L (as electricity rates are not being adjusted to increased production costs) and even brings additional risks for the company. In particular, the territory of its Vuhlehirska TPP in the Donbas region is currently occupied by armed separatists, implying a risk of the plant’s idling or even damage.



Two other Centrenergo power plants, located far away from Donbas, are still under risk of power under-production. These power plants are designed to burn anthracitic/lean coal, which is mined in the war-afflicted zone of Donbas, implying a risk of insufficient coal supplies to these plants unless the situation de-escalates.

Источник: Конкорд Капитал

Аналитик: Александр Паращий
Другие обзоры по компаниям и отраслям от Конкорд Капитал


Компании

все компании