In the first half of 2021, Eesti Energia earned a net profit of EUR 16.5 million with a record sales revenue of EUR 538 million. In the same period last year the company made a net profit of EUR 5 million.
Turnover of the first half of the year increased by 36% YoY and reached the level of EUR 538.4 million. EBITDA increased by 8%, to EUR 113.2 million.
Turnover in the second quarter increased by 43% YoY, to EUR 241.1 million, while EBITDA decreased by a quarter to EUR 40.8 million. The company made a net loss of EUR 10 million in the second quarter compared with a profit of EUR 7 million last year.
Andri Avila, member of the management board and Chief Financial Officer of Eesti Energia, said the situation in the energy markets was radically different compared to last year. The high level of market prices has favored the group’s core business without taking into account the impact of derivative transactions, as the sales revenue of all business areas had grown strongly.
Eesti Energia protects itself against large fluctuations in market prices by hedging transactions to ensure business stability.
“We reassess the future value of derivatives in accordance with accounting rules on a monthly basis, although the actual impact will become clear later when these transactions take place. The negative value of derivative transactions arising from fluctuations in market prices had a significant impact on Eesti Energia’s second quarter results,” she said.
The average market price of electricity in the Estonian price area increased almost two-fold during a year and reached EUR 55 per MWh, elsewhere in the price areas of the Nord Pool exchange the price growth was even faster.
In the conditions of economic growth, consumption has increased, less wind electricity reached the market due to weather conditions, and low rainfall reduced the production of hydroelectric power in the Nordic countries. In controlled production, this has been compensated by higher prices for fuels and CO2 emissions, which is reflected in higher electricity market prices.
In the second quarter, Eesti Energia produced 904 GWh of electricity, up by 45%. The share of renewable electricity in total production was 42% or 378 GWh. The amount of renewable electricity produced increased by a third over the year.
Due to the increase in electricity consumption, the sales volume of network services, which increased by 7%, raised the sales revenue of electricity delivery by 5%, to EUR 52 million.
The oil market reached the Covid-19 pre-pandemic price level. This supported the production of liquid fuels, which increased by 13% and reached 97,000 tons.
The group’s investments almost doubled and reached EUR 54 million. The increase is due to the first installment of a new wind farm to be built in Lithuania (Silale II, 43 MW) and a new liquid fuel plant, and an increase in investments aimed at increasing the reliability of the electricity network. (ERR/Business World Magazine)