Bulgarian Electricity Company NEK Turns to Q1 Pre-Tax Profit of 12.8 Mln Euro

Bulgaria's state-owned National Electricity Company (NEK) said on Thursday it turned to а pre-tax profit of 25 million levs ($14.4 million/12.8 million euro) in the first quarter of the year from a pre-tax loss of 93.8 million levs a year earlier.

The positive results are due to a 67% increase to 1.535 billion kWh in the output of big hydropower plants, in the three-month period and that fact that the energy system is operating at higher capacity, the company said in a financial report.

In the same report NEK said its parent, the Bulgarian Energy Holding, posted an after-tax profit of7.895 million levs in the three months trough March, up by 2.8% on the year.

In its annual financial report released earlier this week, NEK said its net loss more than doubled to 586.7 million levs in 2014 from 217.7 million levs a year before. NEK more than halved its own capital to 1.6 billion levs in 2014 from 4 billion a year earlier.

Its liabilities grew to more than 1.1 billion levsfrom 771 million levs in 2013. However, NEK repaid its parent company BEH over 100 million levs in debts last year.

Electricity sales generated 2 billion levs in revenues for NEK in 2014, down from 2.6 billion levs a year earlier.

In February Bulgaria's parliament approved amendments to the country's energy legislation aiming to stabilize financially the energy sector. The amendments envisaged the exclusion of TPPs, whose operations are inefficient, from the country's energy mix, and curbing power production from biomass, among others.

In April the Bulgarian units of US companies AES and ContourGlobal agreed with NEK on a decrease by 14% and 17%, respectively, in the capacity price for electricity produced by their coal-fired plants in the southeast of the country. For its part, NEK agreed to pay all arrears to the two companies amounting to a total of 700 million levs. The agreement with NEK for an amendment to the Power Purchase Agreements (PPAs) that the plants have with the utility will result in cumulative savings for NEK of about 1.0 billion levs andannual savings of about 100 million levs over the remaining term of the PPAs, the Bulgarian government said at the time.

Source: SeeNews