Electrica Regs Regulatory News (ELSA)

Summary of Consolidated Results for 2023 - 25 March 2024

Solid net profit and EBIDTA growth at consolidated level in 2023, up to RON 772.1 mn., respectively to RON 1,714.1 mn.

The evolution of the main indicators for 2023:

§ EBITDA - RON 1,714.7 mn., an increase or RON 1,340.5 mn. compared to 2022;

§ Operating income - RON 13,315.2 mn., a slight increase of 3.6% compared to 2022;

§ Net result - net profit of RON 772.1 mn., an increase of RON 1,012.6 mn..

Analysis of the consolidated financial indicators

The main results presented below are extracted from the Consolidated Financial Statements as of and for the period ended 31 December 2023 prepared in accordance with IFRS-EU:

*Amounts are rounded to the nearest whole value

*\* The amounts for 2022 were restated for IFRS-EU

Source: Electrica

In 2023, EBITDA at Electrica Group level increased by 358.8%, respectively by RON 1,340.5 mn., reaching a value of RON 1,714.1 mn., compared to the value of RON 373.6 mn. achieved in 2022.

The EBITDA growth in 2023 was mainly driven by the operational performance of the distribution segment on the back of the increase in electricity distribution revenues by approximately RON 1,014.8 mn., or 29.9%, to RON 4,411.5 mn. from RON 3,396.6 mn. in 2022.

The operating profit had an increase of RON 1,314.4 mn., reaching a value of RON 1,191.8 mn. due to the positive impact generated by the operating expense decrease of RON 850.1 mn., to which is added the positive impact of the operating income of RON 464.3 mn..

The net result of the Electrica Group for 2023 increased of RON 1,012.6 mn., reaching a value of RON 772.1 mn. from a net loss of RON 240.5 mn. from the previous year. This result is generated mainly by the performance of the distribution segment in the context of decreasing electricity costs to cover NL, as a result of the implementation of the MACEE centralized purchase mechanism, according to which the producers have the obligation to sell 80% of the available energy at a price of 450 RON/MWh, impact diminished by the increase in the volumes of electricity needed to cover losses in the network.

On the distribution segment, revenues increased by approximately RON 1,014.8 mn., or 29.9%, to RON 4,411.5 mn., from RON 3,396.6 mn. in 2022 mainly due to the increase in revenues recognized under IFRIC 12 (recognized based on the stage of execution of the works, according to the accounting policy regarding the recognition of income from construction contracts), to which was added the increase in distribution tariffs as well as the decrease in volumes of electricity distributed. As a result of ANRE order 27/2023, starting from Q2 2023, the distribution tariffs have been higher by approx. 20% (26.1% MN area; 21.5% TN area and 10.9% TS area), compared to the same period of the previous year. The tariffs applicable from 1 April 2023 have not changed until 31 December 2023.

For the supply segment, the revenues from electricity and natural gas supply decreased in 2023 by approximately RON 905.8 mn., or 11.1%, to RON 7,280.3 mn. from RON 8,186.0 mn. in 2022 due to the decrease of quantities of electricity supplied in 2023 by approximately 9.1%, due to the decrease in the customer portfolio, as well as the decrease in consumption at the national level (as an effect of electricity price increases but also energy efficiency measures implemented). For the supply segment, both in 2023 and in 2022, the effect of retail electricity prices was covered by subsidies received from the state authorities, as a result of the application of the electricity and natural gas price ceiling mechanism, as a result of the application of Ordinance 27/2022, with subsequent amendments and additions.

OTHER IMPORTANT OPERATIONAL INFORMATION

§ During 2023, the Group reassessed its previous position with the consolidated financial statements related to the recognition of financial assets from the amendment of the concession agreements, for which a financial asset in the amount of RON 951,5 mn. was recognised, representing the difference between the net cost with the purchase of the energy for NL and the NL cost included in the regulatory tariff by ANRE, for the period 1 January - 31 December 2022, and restated the comparatives in the current year financial statements.

***

The results presented in this release are based on the consolidated financial statements prepared in accordance with the IFRS-EU for the approval of accounting regulations in accordance with International Financial Reporting Standards.

The documents related to the 12M 2023 results are available on Electrica's website at the following links: https://www.electrica.ro/en/investors/general-meetings-of-shareholders/2024-gms/general-meeting-of-shareholders-as-of-25-april-2024/ and https://www.electrica.ro/en/investors/results-and-reports/financial-results/financial-statements-for-2023/.

Contact Details: Electrica Investor Relations - ir@electrica.ro ; +40731796111

CEO CFO

Alexandru-Aurelian Chirita Stefan Alexandru Frangulea