Energijos Skirstymo Operatorius AB - Notification on material event

Preliminary ESO results for six months of 2017: net profit reached EUR 46 million, revenue - EUR 308 million

Energijos Skirstymo Operatorius AB (hereinafter – ESO or the Company), identification code 304151376, registered office placed at Aguonu str. 24, Vilnius, Republic of Lithuania. The total number of registered ordinary shares issued by company is 894 630 333; ISIN code LT0000130023.

Electricity and natural gas distribution company ESO during the six months of 2017 earned EUR 46.3 million net profit – 13% less compared to January-June of 2016. Net profit decreased due to lower revenue.

The Company’s revenue during January-June of 2017 amounted to EUR 307.8 million and, compared to the same period of 2016, decreased by 7.8%, when it totaled EUR 334.0 million. Revenue decreased due to lower electricity and natural gas distribution service prices to the customers.

During January-June of 2017 ESO EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) amounted to EUR 76.6 million – 12.6% less compared to the same period of 2016, when EBITDA was equal to EUR 87.7 million.

Adjusted EBITDA* on a comparable time increased by 4.6% to EUR 75.3 million due to implemented investments of the Company.

*The Company adjusted EBITDA due to the difference between the actual profit and previous reporting periods profits, National Commission for Energy Control and Prices (hereinafter - the Commission) for the corresponding periods of permitted investment returns. The difference was due to the Company's effective activity and other factors.

The Company does not evaluate the Commission’s established incentive mechanism to influence adjusted EBITDA, according which return on investment for 2016 and 2017 can be increased due to operational efficiency, which the Company will have to justify to the Commission.

         Head of Communications Unit Martynas Burba, tel. (8~5) 2514516.