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PGE Group’s Q2 2023 report reveals financial gains from railway energy, increased investments, and evolving energy dynamics in Poland’s energy sector.
The first inclusion of activities from the acquired PKP Energetyka (Railway Energy) segment
PGE Group, one of Poland’s leading energy companies, has published its estimated financial and operational results for the second quarter of 2023. This report marks the first inclusion of activities from the acquired PKP Energetyka (Railway Energy) segment, a move that significantly boosted the group’s results. Let’s delve into the highlights of PGE’s Q2 2023 performance.
The acquisition of PKP Energetyka in April contributed approximately 269 million Polish złoty to PGE Group’s earnings. As a result, the total recurring EBITDA for PGE in the second quarter reached approximately 2.9 billion złoty. This period also saw a substantial increase in the group’s investments, totaling nearly 4 billion złoty for the first half of 2023, compared to 1.8 billion złoty in the same period in 2022.
Following the PKP Energetyka acquisition, PGE created a new business segment called “Railway Energy” that focuses on providing energy services to railway infrastructure. This segment reported an EBITDA profit of around 0.27 billion złoty, driven by energy distribution, traction, and electroenergetic services, as well as energy sales.
PGE’s investment expenditure for the second quarter of 2023 amounted to approximately 2.4 billion złoty, a significant increase compared to 0.9 billion złoty in the same period in 2022.
The Conventional Energy segment reported a recurring EBITDA profit of about 0.46 billion złoty in Q2 2023, a notable improvement compared to a loss of 0.04 billion złoty in Q2 2022. Higher revenues from Regulatory System Services and the Power Market contributed to this positive outcome.
Other segments, including District Heating, Renewable Energy, Distribution, Trade, and Closed-Loop Economy, also demonstrated improved EBITDA results compared to the previous year.
PGE Group recorded a reported EBITDA profit of approximately 2.4 billion złoty in Q2 2023, representing a 35% decrease compared to the same period in 2022. This decrease was mainly attributed to non-cash events related to changes in reserve estimates for reclamation and actuarial purposes. The net profit attributable to the controlling entity’s shareholders in Q2 2023 was around 0.4 billion złoty, down from 2.3 billion złoty in Q2 2022, with similar contributing factors.
The estimated net financial debt level, including future payments for CO2 emissions allowances, stood at approximately 19.3 billion złoty, reflecting an increase compared to the first quarter of 2023. This increase was primarily driven by the PKP Energetyka acquisition.
In Q2 2023, PGE Group’s estimated net electricity production from its generating units was approximately 12.3 TWh, marking an 18% decrease compared to Q2 2022. However, electricity distribution volume reached around 9.4 TWh, showing a 6% year-on-year increase. Electricity sales to end-users amounted to around 8.6 TWh, a 3% increase year-on-year, while heat sales totaled 8.2 PJ, representing a 3% decrease compared to the same period in 2022.
Presented values are estimated and may change. Consolidated financial statements of the PGE Group are still in the preparation process. The consolidated report for HY 2023 is planned to be published on September 26, 2023.