News

Eesti Energia's sales revenue and profit increased in Q1

The sales revenue of Eesti Energia increased to EUR 571.5 million in the first quarter of 2022 due to high energy prices, being the best outcome ever for the group.

The turnover increased by 274 million euros (+92%) compared to the same period last year.

“As Eesti Energia has entered into a large number of long-term electricity purchase and sale agreements (PPA) and the future market value of these agreements is constantly changing, the energy group will also present adjusted EBITDA and net profit from 2022 onwards,” explained Andri Avila, Chief Financial Officer and Member of the Management Board at Eesti Energia.

The Group’s adjusted EBITDA was at EUR 127.3 million (+88.2%) and adjusted net profit was at EUR 77.2 million (+254.2%).

Taking into account the effect of the revaluation of the future market value of long-term agreements, Eesti Energia's reported EBITDA in the first quarter was EUR 213 million and net profit was EUR 163 million.

Q1 2022

Q1 2021

Change

**Sales revenue**

M €

**571,5**

297,3

+92,2%

**EBITDA**

M €

**127,3**(213)*

67,6(72,4)*

+88,2%

**Net profit**

M €

**77,2**(163)*

21,8(26,5)*

+254,2%

**Investments**

M €

**59,3**

32,1

+84,6%

* including revaluation of the market value of long-term electricity purchase and sale agreements

The largest impact on financial indicators was due to higher electricity prices in all home markets. While the quarterly average market price of electricity in Estonia increased 157% y-o-y to EUR 133, it increased even more in the rest of the Baltic countries.

Despite a warmer winter than 2021 and almost a 6% decrease in electricity consumption, the electricity sales volume of Eesti Energia, a company with an international growth ambition, increased by 13% y-o-y to 2.9 terawatt-hours. Sales in Finland, Latvia, Lithuania and Poland accounted for a total of 54% and in Estonia for 46% of the total volume.

State support measures helped to alleviate the stress of customers' electricity bills on their wallets. The discount on the network fee and the ceiling on the price of electricity valid until the end of March reduced the energy bills of Eesti Energia's customers by a total of 49 million euros in the first quarter.

Electricity production increased by 31% to 1.7 terawatt-hours in the first quarter compared to the same period last year. Of this, renewable electricity production accounted for 0.4 terawatt-hours (+2%). Electricity production increased primarily due to the increased market demand for steerable production that’s cheaper than gas plants, i.e. thermal power plants in the case of Eesti Energia.

Sales of liquid fuels decreased by 7% y-o-y to 104,000 tons and production by 15% to 106,000 tons due to a different maintenance period at the plants.

The group's investments in Q1 increased to EUR 59 million (+85%). Elektrilevi, a subsidiary of the company, invested a total of EUR 21 million in the power network, the lion's share of which was spent on building connections for new producers. The capacity of the solar power plants connected to Elektrilevi’s distribution network increased to 405 megawatts by the end of the quarter. At the end of 2021, this figure was 385 megawatts.

Enefit Green, a subsidiary of Eesti Energia, is currently building four new wind farms in Estonia, Lithuania and Finland to supply customers with more affordable electricity. Investments in these wind farms amounted to more than EUR 11 million over the quarter.

New wind farms are being built in cooperation with customers whose agreements provide the necessary security for investments. There is a high demand for fixed-price renewable electricity sales agreements offered by Eesti Energia.

In the inflationary economic environment and the end of energy subsidies, 1,150 business customers and 21,000 household customers from Estonia, Latvia and Lithuania prefer long-term security for electricity prices.

The total volume of agreements concluded over the years amounts to 10.5 terawatt-hours, being more than the total consumption in Estonia per one year.