PPC announced its FY 2014 results which came below market estimates in bottom line

PPC announced its FY 2014 results which came below market estimates in bottom line. The miss is attributed to the higher than expected provisions for bad debt (€119m vs €90m estimate).

 

The following table summarises results vs market estimates:

 

PPC 2013 2014 Y-o-Y 2014 Act. vs 2013 2014 Y-o-Y 2014 Act. vs
EUR m. 12M 12M (%) FY  Est. Est. 4Q 4Q (%) 4Q Est. Est.
Sales 5.970,8 5.863,6 -1,8%  5.834,9 0,5%  1.477,0 1.438,7 -2,6%  1.410,0 2,0% 
EBITDA 881,6 1.022,1 15,9%  1.014,4 0,8%  200,5 227,7 13,5%  220,0 3,5% 
EBITDA Mrg 14,8%  17,4%  +267 bps  17,4%  +0 bps  13,6%  15,8%  +225 bps  15,6%  +0 bps 
Net Income -225,3 91,3 140,5%  131,8 -30,7%  -231,9 -30,5 86,8%  10,0 -405,3% 
Net Mrg -3,8%  1,6%  +533 bps  2,3%  -0 bps  -15,7%  -2,1%  +1.358 bps  0,7%  -4 bps 

 

Q4/FY Highlights:

 

 

  • Turnover declined by € 107.2 m. (1.8%) to € 5,863.6 m in 2014 from € 5,970.8 m in 2013. Turnover includes an amount of € 72.1 m. reflecting network users’ participation for their connection to the network versus € 90.2 m in 2013.  PPC’s revenues from electricity sales, declined by € 111.2 m (1.9%) to € 5,654.6 m. in 2014 compared to € 5,765.8 m in 2013.
  • In 4Q2014, PPC’s electricity generation and imports covered 62.8% of total demand vs 68.6% in 4Q2013, a reduction which is largely attributed to the decrease of lignite-fired generation by 12.2% (756 GWh) and natural gas-fired generation by 49.2% (774 GWh). However said reduction was more than offset by increased imports by PPC (276 GWh) and from third parties (1,372 GWh), as well as by higher hydro generation (35.1% or 268 GWh) due to improved hydrological conditions. The significant increase of imports is mainly attributed to the increase of the average System Marginal Price (SMP) to € 59.2/MWh in 4Q2014 vs € 53/MWh in 4Q2013.
  • In the fourth quarter of 2014, natural gas expense was cut to approximately half the relevant cost in the fourth quarter of 2013 (reduction of € 85.6 m or 54.1%) due to reduced gas-fired generation by 49.2% (774 GWh) and lower gas prices.
  • Net debt amounted to € 4,991.9 m., an increase of € 467.6 m. compared to 31.12.2013 (€ 4,524.3 m.). This development is due to increased working capital needs including a net outflow of about € 190 m. for the rendering of the last part of the Special Property Tax and the extraordinary payment of € 48.3 m. against the LAGIE deficit.

 

A conference call is scheduled on March 30 at 14:00 (GR time). Focus on debt, tariffs and overdue bills. CC Details:

 

¡  GR Participants dial in:         + 30 211 180 2000

¡  UK Participants dial in:         + 44 (0) 800 368 1063

¡  US Participants dial in:          + 1 866 288 9315

 

Best Regards,

 

Manos Chatzidakis

Head of research

Beta Securities S.A.

29 Alexandras Ave.

GR – 11473

Athens, Greece

 

Tel: +30 210 6478755 /754

Fax +30 210 6448791

Email: [email protected]