Current Report No.: 15/2020
Current Report No.: 15/2020
Date of Preparation: 31 March 2020
Issuer's Abbreviated Name: ENEA S.A.
Subject: Information on the intention to include non-recurring operations of an accounting nature in the financial statements for 2019
Legal Basis: Article 17 Section 1 of the Market Abuse Regulation - confidential information
Body of the report:
The Management Board of ENEA S.A. ("Issuer", "Company") hereby reports that on 31 March 2020 a decision was made to recognize impairments on the carrying amount of assets.
Impact on the consolidated financial statements of the ENEA Group
In the Generation Area, the test results indicated an increase in the carrying amount of assets, which will be recognized by reversing the impairment losses posted in 2016 (as disclosed by the Issuer in Current Report No. 10/2016), in the Financial Statements of ENEA Wytwarzanie sp. z o.o. for the total amount of PLN 11.6 million. Moreover, in the Biogas Cash Generation Unit (CGU) of the Renewable Energy Sources Area, an impairment of assets in the amount of PLN 1.3 million was recognized.
In the Heat Area, the tests demonstrated the need to recognize an impairment of the carrying amount of assets in the financial statements of ENEA Ciepło sp. z o.o. for the amount of PLN 20.4 million.
With reference to Current Report No. 6/2020 of 14 February 2020, the Issuer hereby reports that on 31 March 2020 a decision was made to recognize, in the consolidated financial statements of the ENEA Group, an impairment loss on Polska Grupa Górnicza S.A. shares in the amount of PLN 52.7 million.
The recognition of these events will reduce profit before tax of the ENEA Group by PLN 62.8 million and the net profit for the reporting period of the ENEA Group by PLN 60.8 million, respectively, but will not affect the consolidated EBITDA.
At the same time, with reference to Current Report No. 9/2020 of 21 February 2020, the Issuer hereby reports that the consolidated results for 2019 will also be affected by the reversal of the provision for the dispute described in the said report in the amount of PLN 129 million. The effect of this accounting operation on the profit before tax will be PLN 129 million, on the net profit for the reporting period will be PLN 104.5 million and on the consolidated EBITDA will be PLN 129 million.
In aggregate, the operations described above will improve the ENEA Group's profit before tax by PLN 66.2 million and net profit for the reporting period by PLN 43.7 million, respectively, and the ENEA Group's consolidated EBITDA by PLN 129 million.
Impact on the financial statements of ENEA S.A.
In connection with the completion of the said tests for impairment of the assets of ENEA Wytwarzanie sp. z o.o., a decision has been made to recognize, in the Issuer's accounting ledgers, the amount of PLN 238.4 million on account of the reversal of impairment losses posted in previous years on the carrying amount of ENEA Wytwarzanie sp. z o.o. shares, which the Issuer disclosed, in particular, in Current Report No. 10/2016 of 4 March 2016.
Moreover, the tests demonstrated the need to recognize an impairment loss of PLN 28.8 million on ENEA Ciepło sp. z o.o. shares.
With reference to Current Report No. 6/2020 of 14 February 2020, the Issuer hereby reports that on 31 March 2020 a decision was made to recognize, in the Issuer's accounting ledgers, an impairment loss on Polska Grupa Górnicza S.A. shares in the amount of PLN 47.7 million, to be reflected in the Company's financial statements.
The combined effect of these recognitions will increase the Company's profit before tax and net profit for the reporting period by PLN 161.9 million.
At the same time, the Issuer points out that the operations described above are of an accounting nature and have no consequence on the Company's liquidity position. The Company makes a reservation that the values presented above are estimates and are subject to change. The final effects of the non-recurring accounting operations described above will be presented in the financial statements of ENEA S.A. and the ENEA Group for 2019, the publication of which is scheduled for 23 April 2020.
Please note that the term EBITDA is defined as the value of operating profit (loss) + depreciation and amortization + impairment losses on non-financial non-current assets (values for the reporting period). The above definition and methodology for its calculation are the same as those for the calculation of this indicator in the Issuer's periodic reports. The definition in question is also provided in the glossary of terms and abbreviations available on the Company's website (https://ir.enea.pl/slownik).
