Business Forum • 29 August, 2024 at 10:25 AM
Premier Energy Group, a key player in the energy market in Southeast Europe, listed on the Main Market of the Bucharest Stock Exchange, reports €512.4 million in revenues in the first six months of 2024, a 10% year-on-year (YoY) increase, with normalized revenue standing at €534.8 million, a 21% YoY increase. The normalized EBITDA saw a 3% increase to €53.2 million.
Jose Garza, CEO of Premier Energy Group, commented: "In the first half of 2024, Premier Energy achieved robust growth across all divisions, despite the industry's challenges. Both our electricity and natural gas supply volumes saw significant double-digit increases. This growth was driven by strategic acquisitions, such as CEZ Vanzare and an 18 MW wind park, but also by organic expansion, including in our natural gas segment, where we increased our distribution footprint, supplied volumes and the number of customers. We delivered on all key performance indicators within our control. Our diversified, vertically integrated business model has proven to be a successful strategy in this complex environment. As part of this ongoing execution, we added 80 MW of wind capacity and 5 MW of solar capacity after June 30th, keeping us on track to reach our strategic electricity generation targets.”
In terms of operational highlights, the owned renewable energy sources (RES) production registered a 7% increase, driven primarily by newly acquired and developed generation assets. This growth was tempered by less favorable wind conditions in Romania. The Group also recorded a 48% increase in electricity supplied and a 26% growth in natural gas supplied, reflecting on the expansion of its energy supply capabilities. The number of customers served by the natural gas distribution network grew by 11%, further strengthening the Group's market position. Additionally, with the acquisition of CEZ Vanzare, renamed to Premier Energy Furnizare, the Company added 1.3 million supply customers to its growing client portfolio. The integration of these new customers is ongoing and on schedule. Operations in Moldova performed as expected on a normalized basis, contributing positively to the overall financial results.
Petr Stohr, CFO of Premier Energy Group, added: "Despite the complex and volatile energy market in the first half of 2024, Premier Energy Group achieved 21% growth in normalized revenue, reaching €534.8 million and a stable EBITDA evolution on a normalized basis. This performance reflects the resilience of our vertically integrated and diversified model of operations. While unsustainable high electricity imbalance costs and lower market conditions impacted some of our profitability, we navigated the first half of the year well and have a strong financial position with approximately €109 million in net working capital and cash balance, ensuring that we are well-positioned to continue driving growth and effectively executing on our stated strategy."
The revenues from the renewable segment in Romania saw a 13% decline, to €87.4 million. This segment was impacted by lower overall electricity prices, the introduction of the new solidarity tax on electricity production plants from April 2024, and the reduced wind production in Romania. The newly acquired Romania Energy Supply segment generated €78.6 million of revenues during its first 3 months of ownership by the Group since its April closing. The revenue from the natural gas distribution and supply business increased by 20% during the first half of the year. The electricity distribution and supply business in the Republic of Moldova saw a 13% YoY decline on an IFRS basis, but was essentially flat on a normalized basis at approximately the €200 million level for the six-month period.
The normalized EBITDA for the six months amounted to €53.2 million for 1H 2024, versus €51.4 million registered in 1H 2023. The normalization includes the value of tariff deviations in the Republic of Moldova in the total amount of €17.6 million, versus an outperformance, and hence a negative adjustment, of €36.2 million in 1H 2023, and the impact of lower tariffs in energy supplied but not billed in Moldova in the amount of €4.8 million (vs positive €12.7 million in 1H 2023).
The profit before tax amounted to €23.2 million for 1H 2024, registering a 64% decrease, with profit after tax amounting to €19.9 million, a 60% YoY decline. The normalized net profit, adjusting for the after-tax tariff and change in tariffs in energy supplied but unbilled impacts, amounted to €39.8 million, a 48% YoY normalized increase.
Premier Energy Group maintained a highly liquid financial position, with approximately €109 million in net working capital and cash balance as of the end of the first half of 2024. This strong liquidity underpins the Group's ability to navigate market challenges effectively and supports ongoing investments in growth initiatives.
Premier Energy Group operates through its business verticals – electricity production, supply and distribution; renewable energy production and management (wind and solar); and natural gas supply and distribution. The group owns, manages or has in development over 1,200 MW of renewable generation capacity (mostly wind and photovoltaics) and supplies electricity to approximately 2.3 million consumption points in Romania and Moldova, the vast majority being households and small businesses. The group also owns a vast electricity distribution network in Moldova which covers approximately 75% of the country's population.
Premier Energy is also a supplier of natural gas for domestic and non-domestic consumers (in retail, industry, trade), and owns and operates a gas distribution network of over 3,700 km in areas surrounding the capital, the southern and western parts of the country, as well as in smaller localities in the northern part of Romania. The company is the third-largest player in the natural gas distribution market and the #4 supplier of electric energy in Romania.