During 2023, Nuclearelectrica recorded revenue growth of 17% YoY, an EBITDA decrease of 13%, and a net income of RON 2.48bn, a 10% decline YoY.
Starting off with the revenue, it amounted to RON 7.4bn, growing by 17% YoY. This was achieved on an electricity production of 10,294 GWh, increasing by 0.9% YoY. Of this, 4.9k GWh was sold via MACEE, (2022: 0), while 5.5k GWh was sold on the competitive market (2022: 10.5k GWh). MACEE refers to the Centralized Electricity Acquisition Mechanism, which has been effective from 1 January 2023, and will be effective until the end of March 2025. This Government Ordinance was implemented to help deal with the energy crisis after the war in Ukraine started. According to it, the Romanian Electricity and Gas Market Operator, OPCOM, buys electricity from producers at a price of RON 450/MWh and sells it to buyers at the same price.
This resulted in RON 2.2bn being sold via MACEE in 2023, and this influenced sales on the competitive market as well. As such, lower quantities were sold on the competitive market, leading to an 18% decline in revenue from the sale of energy on the competitive market, to RON 5.2bn.
Moving on, total operating expenses grew by 44% YoY to RON 5.09bn. The largest increase by far came from the tax on additional income/Contribution to the Energy Transition Fund, which grew by 142% YoY to RON 2.6bn. This is also part of the above-mentioned Government Ordinance, which while it had multiple forms before, now states (and the form active in 2023) that all the revenue achieved above the RON 450/MWh price will be taxed at a 100% rate. As Nuclearelectrica sold electricity above the price during the period, the tax / Contribution to the Energy Transition Fund grew significantly. As mentioned above, this is in effect until the end of March 2025.
Coming back to the OPEX, personnel expenses grew by 35% YoY, to RON 749m, above the inflation rate, while other op. expenses also increased, by 32% YoY to RON 661m. On the other hand, electricity purchased costs decreased significantly, by 77% YoY to RON 120m. As a result of the faster OPEX than revenue growth, EBITDA declined by 13% YoY to RON 3.1bn, implying an EBITDA margin of 42.1%, a 14.6 p.p. decline YoY.
In terms of the net financial result, it increased by 85% YoY to RON 381.6m, due to a 74% increase YoY in the financial income to RON 413.7m, while financial expenses remained roughly the same. The financial income itself, came mostly due to higher interest income (+62% YoY, to RON 352.6m), as well as higher income from FX differences (+111% YoY, to RON 42.5m).
As a result of all of these developments, Nuclearelectrica recorded a net income of RON 2.48bn, representing a decrease of 10% YoY. This would also imply a net income margin of 33.4%, which is a decline of 10.1 p.p. YoY.
Nuclearelectrica key financials (Preliminary 2023 vs. 2022, RONm)
Source: Nuclearelectrica, InterCapital Research
Taking a quick look at the balance sheet, total assets grew by 12% YoY to RON 13.2bn, supported by higher non-current assets, which grew by 24% YoY to RON 7.5bn, while current assets slightly declined. The increase in the non-current assets came from higher tangible assets (+14% YoY, to RON 6.5bn), mainly as a result of the revaluation of the lands, buildings, and constructions at FV. Furthermore, financial assets also grew significantly, by 14x YoY to RON 634.9m, mainly due to the bonds purchased by Nuclearelectrica, in the amount of RON 552.2m (2022: RON 0m).
On the other hand, total liabilities grew by 14% YoY to RON 1.4bn, supported by the 30% increase of current liabilities, to RON 1.03bn, while non-current liabilities declined by 13%, to RON 396m. The decrease in non-current liabilities came due to the loan which was being repaid reaching <1 year until full repayment, and as such its effect isn’t visible in the non-current liabilities (2023: RON 0m, 2022: RON 64.8m). On the other hand, the increase in current liabilities came primarily due to higher trade and other payables, which grew by 83% YoY to RON 816.7m.
