Eesti Energia's operating income exceeded one billion for the first time, with net profit of EUR 23.2 million

In 2019, Eesti Energia earned over one billion euros in operating income, with EBITDA of approximately EUR 260 million and net profit of EUR 23.2 million.

The company's total revenue increased by 120.9 million to 1.02 billion euros (+13%). Whereas, the sales revenue increased by 81.2 million to 956.4 million euros (+9%).

EBITDA decreased by EUR 23.4 million to EUR 259.8 million (-8%) and net profit decreased by EUR 83 million to EUR 23.2 million (-78%).

“In terms of operating income, we achieved the best result in the history of the company, and this shows that we have been moving in the right direction, primarily in developing the fields of renewable energy, liquid fuels and customer-oriented services. True, due to the massive restructuring in the field of large-scale energy production, our profitability suffered, but we had to react to the market situation to face the future being stronger,” commented Andri Avila, Member of the Management Board of the Group, and CFO.

As a second major contributor to the net profit, Avila pointed to the exponential increase in depreciation costs which grew by more than EUR 33 million in a year. This was mainly due to the addition of Auvere Power Plant to the assets.

“On the other hand, we are pleased that our vigorous steps in developing renewable energy production have borne fruit. In just a few years, our renewable energy subsidiary Enefit Green has become the group's most profitable company,” Avila said.

Eesti Energia generated approximately 1.65 TWh of renewable energy in 2019, of which 1.28 TWh was renewable electricity. A significant proportion of it (1 TWh) was produced by wind farms located in Estonia and Lithuania, showing good reliability. The rest of the renewable electricity came mainly from wood waste, solar farms and CHP plants.

The share of electricity produced from renewable and alternative sources in total output increased from 13% to 36% in a year. By 2023, the company aims to achieve the goal where 45% of electricity is produced from renewable and alternative sources.

In 2019, total electricity output fell to 5.5 TWh (-39%). This was mainly due to a significant decrease in oil shale electricity production. The cost price of oil shale electricity was influenced by a 60% price increase of the CO2 quota to an annual average of 24.9 € per tonne. At the same time, the average market price of electricity remained at a level comparable to the previous year.

The reduction of electricity production from oil shale meant that the company's CO2 emissions fell by 48% to the level of 5.9 million tonnes over the year. As a result, Estonia's CO2 emissions decreased by about a quarter in the year, and Estonia has become the fastest reducer of CO2 emissions in the European Union.

In shale oil production, Eesti Energia set an all-time record of 442,000 tonnes. The output increased mainly due to improved reliability and yields of the Enefit 280 oil plant.

The sales revenue of Elektrilevi, subsidiary and network service provider, decreased due to the lowered tariffs for customers, which left the consumers of the service with almost 20 million euros more than a year ago. The price of the service was reduced due to efficient management of Elektrilevi and a favourable interest rate environment.

Eesti Energia's investments decreased by 30% to 136 million euros. A significant proportion of investments, 83 million, were made in improving the reliability of the power network. The largest contributor to the decline in investments in yearly comparison was the Auvere Power Plant investment which ended with the acceptance of the plant in 2018.

“It was a difficult but challenging year. We plan to surprise our customers with several new services this year. As energy professionals, we believe that we are able to provide the latest and greatest technological solutions in this rapidly changing world,” Andri Avila said.