2015-05-29 15:01:00 CEST

2015-05-29 15:01:04 CEST


REGULATED INFORMATION

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Lietuvos energijos gamyba, AB - Interim information

Operating results of "Lietuvos energijos gamyba", AB, Group for the three-month period ended 31 March 2015 


Elektrėnai, Lithuania, 2015-05-29 15:01 CEST (GLOBE NEWSWIRE) -- 

“LIETUVOS ENERGIJOS GAMYBA” GROUP WAS PROFITABLE AND INCREASED ITS
COMPETITIVENESS IN THE FIRST QUARTER 

Efforts of the group of companies “Lietuvos energijos gamyba” ("Group")
carrying out the activities of electricity generation and trade to smoothly
adapt to rapidly changing market conditions proved to be beneficial to its
shareholders and consumers. The Group's EBITDA in January-March 2015, in
comparison with January-March 2014, increased by 20.4% - up to EUR 20.4
million, while the decrease in the net profit reported in unaudited preliminary
financial statements was due to the accounted sale of subsidiary companies. "The most prominent highlights of the first quarter of 2015 on which we were
and are continuing to work hard were ensuring reliable production of
electricity and heat power in power plants controlled by “Lietuvos energijos
gamyba” and striving to remain among the most competitive players of
electricity market under conditions of growing competition. Our power plants
were operating based on planned schedules and without any incidents since we
used modern equipment and discontinued using the inefficient one. Successful
trade in electricity was an important contributing factor in achieving good
results," said Juozas Bartlingas, CEO and Chairman of the Board of “Lietuvos
energijos gamyba”, AB ("Company"). 

Based on unaudited financial statements, the Company's sales revenue for
January-March 2015 decreased by 10.9% in comparison with the results of
January-March 2014, i.e. from EUR 41.79 million to EUR 37.23 million. The
Group's sales revenue amounted to EUR 42.8 million in January-March 2015 and
was 1.6% lower than in January-March 2014 (EUR 42.1 million). 

One of the main reasons for the decrease in the sales revenue was structural
changes in the electricity trading portfolio. After the Company joined NASDAQ
OMX Commodities derivatives exchange, trading in power derivatives (mainly
contracts for price difference) rather than trading in physical electricity has
had an increasing share of the Company‘s electricity trading portfolio. 

The Company's sales revenue was also negatively affected by a decrease in the
electricity generation volume at the Kaunas Algirdas Brazauskas' Hydroelectric
Power Plant ("Kaunas HPP") due to comparatively low flow rate of Nemunas river.
In January-March 2015 this power plant produced 0.096 TWh of electricity, i.e.
14.8% less than during the same period last year (0.113 TWh). 

Despite the decrease in production in Kaunas, total amount of electricity
generated in three months of 2015 by all power plants of the Company only
slightly differed from the last year's -0.247 TWh in total (0.245 TWh at the
same time in 2014). The largest contribution was by Kruonis Pumped Storage
Hydroelectric Plant ("Kruonis PSHP"). Due to an efficient use of the advantage
of this power plant which allowed to sell cheaper electricity generated during
the night for a higher day time rate since the very beginning of the year, its
production volume increased by 14.5% (from 0.132 to 0.151 TWh). No subsidized
electricity was generated in January-March 2015 at the Elektrėnai Complex, just
as in the same period last year: according to a plan agreed with the
transmission system operator, in order to ensure an efficient use of allocated
public interest service funds, the combined cycle unit of the Elektrėnai
Complex operates since the middle of April and only during the warm period of
the year. 

The Company's sales in the free market dropped by 25.9%: they made 0.414 TWh in
January-March 2014 and only 0.307 TWh in the same period this year.
Nevertheless, good results of trading in power derivatives have made a
considerable contribution to the increase in the Company‘s EBITDA from EUR 16.1
million in January-March 2014 to EUR 18.4 million in the same period this year
(14.2% growth). The Group's EBITDA grew even more, i.e. by 20.4% (from EUR 16.9
million to EUR 20.4 million). In comparison to the results of January-March
2014, the Group's EBITDA margin increased by 12.2 percentage points - from
29.9% to 42.1%. 

The Company's net profit indicators in January-March 2015 were also much better
than in the same period last year: the Company's net profit has increased more
than one and a half times and was EUR 14.82 million or 59.5% bigger than in
January-March 2014 (EUR 9.29 million). The growth in the net profit was largely
influenced by the overall result of sale of the Company's shareholding in
Energijos tiekimas UAB (ET) and UAB “Kauno energetikos remontas” (KER) of 31
March 2015. 

It should be noted, when evaluating the changes in the Group's consolidated net
profit indicators from quarter to quarter, that intermediate unaudited Group's
statements for January-March 2015 contained recalculated data of the same
period in 2014. 

The sale of subsidiary company UAB Duomenų logistikos centras ("DLC") of 31
March 2014 is no longer accounted for as a discontinued operation, therefore
DLC's results (profit) accumulated until the day of sale is reflected in
recalculated Group's results of January-March 2014 and increased net profit for
that period amounts to EUR 16.6 million. 

On 31 March 2015, the Group sold the shares of subsidiary companies KER and ET,
therefore the Group's results for January-March 2015 reflects the loss of KER
and profit of ET accumulated until the day of sale. The Group's net profit in
January-March 2015 constituted EUR 7.6 million. "Good financial results demonstrate our continuing efforts in increasing value
and ensuring proper return to our shareholders. The processes that have been
implemented and newly started in the first quarter of this year show that
“Lietuvos energijos gamyba” is closely following activities provided for in its
long-term strategy," said Company's CEO. "To utilize the most efficient
equipment in our possession, we worked hard at Kruonis PSHP, set up the
combined cycle unit to ensure reliable generation of electricity during the
warm period of the year, discontinued the use of inefficient units 1 and 2 at
the stand-by power plant and started their disassembly, launched a new steam
boiler plant and came near the end of construction works of a biofuel boiler
plant in Elektrėnai."

In accordance to Bartlingas, all this lets the Company cut down the use of
public interest service funds and ensure that all electricity consumers in the
country pay less for electricity. The Company also tries to ensure that its
community members such as Elektrėnai residents and businesses pay for heat
energy at competitive rates. 

Additional information about regulated and commercial operations

In 2015 the Company will continue its efforts to properly assess its operations
taking into consideration actual market conditions and provisions of effective
legislative acts and previously adopted regulations. 

In accordance with the Company, the Group's regulated operations include
electricity and heat energy generation at Elektrėnai Complex and reserve
services provided by Kruonis PSHP and Elektrėnai Complex. Revenue for these
operations in January-March 2015 amounted to EUR 17.4 million, i.e. slightly
(2.9%) more than in January-March 2014. 

Revenue from commercial operations that, according to the Company, include
electricity generation at Kruonis PSHP and Kaunas HPP as well as wholesale and
retail of electricity in the free market and other commercial services have
decreased by 22% (from EUR 39.7 million in January-March 2014 to EUR 30.9
million in January-March 2015) due to the above-mentioned changes in principles
of trading in electricity and decrease in electricity generation volume at
Kaunas HPP. 

In January-March 2015 revenue from commercial operations made 64% of all
Group's revenues. 


“Lietuvos energijos gamyba”, AB is a company listed on NASDAQ OMX Vilnius.
“Lietuvos energija”, UAB, a state-controlled company, owns 96.13% of its
shares. 

On 31 March 2015, the Company transferred the shares of Energijos tiekimas UAB
and UAB “Kauno energetikos remontas” that were owned by the group of companies
“Lietuvos energijos gamyba” to “Lietuvos energija”, UAB. 


         Valentas Neviera, Head of Corporate Communication Division, tel. +370
5 278 2908, e-mail. valentas.neviera@le.lt