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Current Report No. 38/2020

11.08.2020 20:00

TAURON Polska Energia Capital Group’s estimated results for H1 2020 and Q2 2020.

TAURON Polska Energia S.A. (“Company”) presents selected estimated consolidated financial results and operating data of TAURON Polska Energia S.A. Capital Group (“TAURON Group”) for H1 2020 and Q2 2020.

The Company informs that due to the ongoing process of selling shares in TAURON Ciepło Sp. z o.o. ("TAURON Ciepło") and in accordance with IFRS 5 ("Fixed assets held for sale and discontinued operations"), the prerequisites for recognizing the shares in TAURON Ciepło as fixed assets held for sale in the Company’s standalone financial statements and TAURON Ciepło's net assets as a group to be disposed of, classified as held for sale in the TAURON Polska Energia S.A. Capital Group’s consolidated financial statements, were met as of the balance sheet date, June 30, 2020. The values presented below as discontinued operations refer to TAURON Ciepło.

Selected estimated consolidated financial results for:

a) H1 2020:

Sales revenue: PLN 10 187 million, including discontinued operations: PLN 299 million
EBITDA (operating profit increased by depreciation, amortization and write-downs for non-financial assets): PLN 2 408 million, including discontinued operations: PLN 92 million
EBIT (operating profit/loss): PLN 362 million, including discontinued operations: PLN (778) million
Gross profit/loss: PLN 117 million, including discontinued operations: PLN (779) million
Net loss: PLN (317) million, including discontinued operations: PLN (781) million
CAPEX: PLN 1 812 million, including discontinued operations: PLN 32 million

EBITDA divided into segments:
- Distribution: PLN 1 689 million
- RES: PLN 164 million
- Generation: PLN 26 million
- Supply: PLN 403 million
- Mining: PLN 7 million


b) Q2 2020:

Sales revenue: PLN 4 719 million, including discontinued operations: PLN 97 million
EBITDA (operating profit increased by depreciation, amortization and write-downs for non-financial assets): PLN 1 450 million, including discontinued operations: PLN 16 million
EBIT (operating loss): PLN (112) million, including discontinued operations: PLN (822) million
Gross loss: PLN (115) million, including discontinued operations: PLN (822) million
Net loss: PLN (479) million, including discontinued operations: PLN (819) million

CAPEX: PLN 872 million, including discontinued operations: PLN 19 million

EBITDA divided into segments:
- Distribution: PLN 1 005 million
- RES: PLN 42 million
- Generation: PLN 28 million
- Supply: PLN 220 million
- Mining: PLN 43 million

The ratios below refer to both continued and discontinued operations
Net debt as of June 30, 2020: PLN 10 098 million
Net debt/ EBITDA as of June 30, 2020: 2.66x

Selected estimated operating data for:

a) H1 2020:

Electricity distribution: 24.6 TWh (including to the final consumers: 23.86 TWh)
Gross electricity production: 5.87 TWh, including gross electricity production from renevable energy sources: 1.00 TWh
Heat production: 6.70 PJ
Retail electricity supply: 15.99 TWh
Commercial coal production: 2.49 mln tons
Commercial coal sales: 1.88 mln tons

b) Q2 2020

Electricity distribution: 11.35 TWh (including to the final consumers: 11.03 TWh)
Gross electricity production: 2.66 TWh, including gross electricity production from renevable energy sources: 0.42 TWh
Heat production: 1.73 PJ
Retail electricity supply: 7.13 TWh
Commercial coal production: 1.30 mln tons
Commercial coal sales: 0.99 mln tons

Material factors impacting the H1 2020 and Q2 2020 earnings:

a) booking in Q2 2020 of the impairment charges related to the loss of the carrying value of the tangible and intangible fixed assets and the rights to use assets in the Mining segment (PLN 179 million) and the Generation segment (PLN 48 million) in the total amount of PLN 227 million. The above impairment charges did not affect TAURON Group's EBITDA,
b) booking in Q2 2020 of the impairment charges related to the loss of the carrying value in the amount of PLN 806 million as of the moment of TAURON Ciepło’s net assets initial revaluation to fair value as a group classified as held for sale. The above impairment charge did not affect TAURON Group's EBITDA,

c) dissolving in Q2 2020 of the actuarial provisions related to employee benefits in the total amount of PLN 533 million which led to an increase of TAURON Group’s EBITDA,

d) financial costs due to the negative FX differences on the EUR denominated debt which led to a decrease of TAURON Group’s gross financial result in H1 2020 by PLN 149 million (no impact on EBITDA). In Q2 2020 the positive FX differences on the EUR denominated debt led to an increase of TAURON Group’s gross financial result by PLN 89 million (no impact on EBITDA),

e) according to the Company’s best knowledge the estimated impact of COVID-19 pandemic on TAURON Group’s H1 2020 EBITDA stands at PLN 147 million and is a consequence, first and foremost, of the lower electricity distribution and sales volumes,

f) change of the Company’s strategy aimed at securing its needs with respect to the retirement of the CO2 emission allowances, as a consequence of which a one-off swap of the exchange traded contracts for the purchase of the CO2 emission allowances with the delivery date in December 2020 for the OTC contracts with the delivery date in March 2021 was made. The transactions carried out as a result of implementing the above mentioned change of the hedging strategy had a negative impact on TAURON Group’s H1 2020 EBITDA in the amount of PLN 125 million,

g) booking in Q2 2020 of the impairment charge related to the deferred income tax assets of TAURON Wydobycie S.A. in the amount of PLN 249 million, because of the estimated impossibility of its application in the foreseeable future. The above impairment charge did not have an impact on TAURON Group's EBITDA.


The financial results presented above are estimates and may be subject to change

The final figures will be presented in the consolidated report for H12020, scheduled to be published on August 19, 2020.

Legal basis: Art. 17 sec. 1 of MAR - inside information
 

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