In 2023, Electrica recorded a revenue decrease of 2% YoY, an EBITDA increase of 27%, and a net income of RON 620m, representing an increase of 11% YoY.
Recently, Electrica published its FY 2023 preliminary results, and today we’re bringing you the highlights. In 2023, Electrica distributed 17.05 TWh of electricity, representing a decrease of 3.8% YoY. At these numbers, the Company serves 3.93m users, over an area covering 40.8% of Romania. In terms of the volumes of electricity supplied to final customers, this amounted to 7.8 TWh, decreasing by 9.1% YoY, as a result of the general downward trend of electricity consumption. Furthermore, Electrica Furnizare, one of the Group’s subsidiaries, supplies electricity to app. 1.7m consumption places on the competitive market, and also operates in the universal service and as a last resort. Also, this subsidiary is one of the largest suppliers in the supply market, with a total market share of 16.6%, and a market share of 10.2% in the competitive market, according to the latest report by ANRE (November 2023).
Moving on to financials, during 2023, Electrica recorded revenue of RON 9.8bn, declining by 2% YoY. Breaking this down into segments, the supply segment, which includes the revenues from electricity and natural gas supply decreased by 11% YoY to RON 7.28bn, due to the decrease in quantities of electricity supplied at -9%, as a result of the decrease in the customer portfolio, as well as the decrease in the consumption at the national level. Electrica further notes that both in 2022 and 2023, the effect of the retail electricity prices was covered by subsidies received from state authorities (2023: RON 3.29bn, 2022: RON 2.69bn), due to the elevated electricity prices recorded.
On the other hand, the distribution segment revenue recorded 30% growth YoY, to RON 4.4bn. This came mainly due to the increase in revenues recognized under IFRIC 12, which stipulates that the revenue is recognized based on the stage of execution of the works (this refers to construction contracts). As such, the revenue did and would in the future differ from the actual numbers achieved, similar as in the real estate industry. Furthermore, to this revenue, an increase in the distribution tariffs, as well as a decrease in the volumes of electricity distributed was added.
As a result of the developments in the distribution segment, EBITDA increased by 30% YoY to RON 4.4bn, implying an EBITDA margin of 17.7%, an increase of app. 4 p.p. YoY. In terms of the net financial result, it was negative at RON 293.8m, as a result of 70% higher financial expenses to RON 297.2m, while the financial income decreased by 65%, to RON 3.4m. As a result, the net income growth was lower, at 11% YoY to RON 620m. As such, the net income margin stood at 6.3%, improving by 0.7 p.p. YoY.
Electrica key financials (Preliminary 2023 vs. 2022, RONm)
Source: Electrica, InterCapital Research
In terms of investments, Electrica invested RON 777m in 2023, representing an increase of 62% YoY. This also represents 102% of the plan for 2023 (2023 plan: RON 777.1m). Of this amount, RON 628.4m is the plan related to 2023, and RON 135.6m was the value carried over from 2022.
