Donbasenergo P&L worsens in 3Q14

Donbasenergo P&L worsens in 3Q14



24 жовтня 2014 года
Конкорд Капитал

Донбассэнерго (DOEN)


Power GenCo Donbasenergo (DOEN UK) reported a 7% yoy decline in its net revenue to UAH 3.72 bln in 9M14, according to its Oct. 23 regulatory filing. The company’s EBITDA improved 8% yoy to UAH 0.87 bln and its bottom line improved 12% yoy to UAH 0.73 bln in 9M14. This result implies that Donbasenergo revenue decreased 23% yoy in 3Q14 to UAH 1,166 mln, while its EBITDA and net income both fell 42% yoy to UAH 160 mln and UAH 104 mln, respectively.



Alexander Paraschiy: The worsened P&L items in 3Q14 was a natural consequence of the idling of Donbasenergo’s Sloviansk thermal power plant (TPP), whose power transformers were damaged by artillery in late June when it was caught amid fierce battles in Donbas. The power plant was non-operating in 3Q14, with one of its boilers having been switched on only on Oct. 16 to provide central heating to its satellite town. Another Donbasenergo plant located in the Donetsk region, Starobesheve TPP, is situated now between the territories controlled by the separatists and the Ukrainian army.



The damaged Sloviansk TPP and tough operating environment for Starobesheve TPP caused a tremendous decrease in Donbasenergo’s power output in 3Q14, which plunged 50% yoy to 5.80 TWh. The decline in the company’s 3Q14 revenue turned out to be more moderate only because the company received some markups to its rates that were aimed at compensating capital expenditures (these were approved last year and most likely will significantly decrease in the near future) as well as improving the company’s liquidity (these were approved in September).



In the next quarter, Donbasenergo is very likely to post a negative bottom line to minimize its full-year profit (as tradition), out of which it has to pay at least 30% in dividends.

Источник: Конкорд Капитал

Аналитик: Александр Паращий
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