Published: 2019-07-26 07:45:00 CEST
Tallinna Vesi
Quarterly report

AS Tallinna Vesi´s financial results for the 2nd quarter of 2019

AS Tallinna Vesi’s sales revenue in the 2nd quarter of 2019 was €16.15 million, showing a 1.1% increase year-on-year. As the tariffs are still frozen at the 2010 level, the increase is related to higher consumption.

83.3% of the sales comprise of the sales of water and wastewater services, which increased by 0.7% to €13.45 year-on-year. Sales to domestic customers in the main service area and sales to outside service areas increased, whilst the sales to corporate clients showed a declining trend.

While the first half-year was successful in construction and asphalting sector due to higher revenues in the 1st quarter of 2019, the revenues in the 2nd quarter of 2019 remained below the results of the same period in 2018.

The gross profit in the 2nd quarter of 2019 decreased by 1.2% to €8.79 million. Despite higher revenues, gross profit was impacted by higher costs related to electricity, chemicals, staff and sludge disposal.

The operating profit decreased by 12.4% to €6.60 million year-on-year, being additionally impacted by higher administrative expenses resulting from the extra legal costs related to the ICSID award.

The net profit for the 2nd quarter of 2019 decreased by 48.9% to €2.79 million year-on-year. In 2019 the dividend payment per share increased from €0.36 per share to €0.75 per share. Higher dividend payment induced also higher income tax on dividend.

MAIN FINANCIAL INDICATORS

€ million,
except key ratios
2nd quarterChange 2019/ 20186 monthsChange 2019/ 2018
201920182017201920182017
Sales16.1515.9814.731.1%30.8130.0628.512.5%
Gross profit8.798.908.53-1.2%17.0517.2216.73-1.0%
Gross profit margin %54.4455.6857.89-2.2%55.3457.2958.70-3.4%
Operating profit before depreciation and amortisation8.078.968.69-9.9%16.4617.1816.68-4.2%
Operating profit before depreciation and amortisation margin %49.9656.0459.02-10.9%53.4357.1558.49-6.5%
Operating profit6.607.547.18-12.4%13.4914.3413.67-5.9%
Operating profit - main business6.407.357.06-12.9%13.1814.0813.53-6.4%
Operating profit margin %40.8847.1848.78-13.4%43.7947.7047.95-8.2%
Profit before taxes6.347.276.96-12.8%13.0213.8013.32-5.6%
Profit before taxes margin %39.2345.4747.25-13.7%42.2545.9146.72-8.0%
Net profit2.795.474.26-48.9%9.4812.0010.62-21.0%
Net profit margin %17.2934.2028.92-49.4%30.7539.9237.25-23.0%
ROA %1.092.321.96-52.9%3.785.164.95-26.8%
Debt to total capital employed %61.3261.6458.54-0.5%61.3261.6458.54-0.5%
ROE %2.705.974.61-54.8%9.4813.6011.89-30.3%
Current ratio3.905.003.70-22.0%3.905.003.70-22.0%
Quick ratio3.874.963.65-22.0%3.874.963.65-22.0%
Investments into fixed assets2.702.211.3021.8%6.113.073.5199.2%
Payout ratio %na62.1199.72nana62.1199.72na

Gross profit margin – Gross profit / Net sales

Operating profit before depreciation and amortisation – Operating profit + depreciation and amortisation

Operating profit before depreciation and amortisation margin – Operating profit before depreciation and amortisation / Net sales

Operating profit margin – Operating profit / Net sales

Net profit margin – Net profit / Net sales

ROA – Net profit / Average Total assets for the period

Debt to Total capital employed – Total liabilities / Total capital employed

ROE – Net profit / Average Total equity for the period

Current ratio – Current assets / Current liabilities

Quick ratio – (Current assets – Stocks) / Current liabilities

Payout ratio - Total Dividends per annum/ Total Net Income per annum

Main business – water and wastewater activities, excl. connections profit and government grants, construction, design and asphalting services, doubtful debt


STATEMENT OF COMPREHENSIVE INCOME2nd quarter2nd quarter 6 months6 months 12 months
(€ thousand)20192018 20192018 2018
        
Revenue16,14915,979 30,81330,056 62,780
Costs of goods sold -7,358-7,082 -13,762-12,839 -28,594
GROSS PROFIT8,7918,897 17,05117,217 34,186
        
Marketing expenses-96-94 -208-206 -386
General administration expenses-2,026-1,216 -3,288-2,595 -5,025
Other income/ expenses (-)-67-48 -61-79 -1,836
OPERATING PROFIT (+)/LOSS (-)6,6027,539 13,49414,337 26,939
        
Interest income105 189 21
Interest expense-276-279 -491-547 -1,010
PROFIT (+)/LOSS (-) BEFORE TAXES6,3367,265 13,02113,799 25,950
        
Income tax on dividends-3,544-1,800 -3,544-1,800 -1,800
        
NET PROFIT (+)/LOSS (-) FOR THE PERIOD2,7925,465 9,47711,999 24,150
COMPREHENSIVE INCOME (+)/LOSS (-) FOR THE PERIOD2,7925,465 9,47711,999 24,150
        
Attributable profit (+)/loss(-) to:       
Equity holders of A-shares2,7915,464 9,47611,998 24,149
B-share holder0.600.60 0.600.60 0.60
        
Earnings per A share (in euros)0.140.27 0.470.60 1.21
Earnings per B share (in euros)600600 600600 600


STATEMENT OF FINANCIAL POSITION   
(€ thousand)30/06/201930/06/201831/12/2018
    
ASSETS   
CURRENT ASSETS   
Cash and cash equivalents58,89552,15461,769
Trade receivables, accrued income and prepaid expenses8,2788,1517,631
Inventories526441498
TOTAL CURRENT ASSETS67,69960,74669,898
    
NON-CURRENT ASSETS   
Property, plant and equipment182,428174,713179,185
Intangible assets645771665
Right-of-use assets60000
TOTAL NON-CURRENT ASSETS183,673175,484179,850
TOTAL ASSETS251,372236,230249,748
    
LIABILITIES AND EQUITY   
CURRENT LIABILITIES   
Current portion of long-term borrowings4,0204783,823
Trade and other payables10,1247,9556,047
Derivatives247411207
Prepayments2,9613,3082,955
TOTAL CURRENT LIABILITIES17,35212,15213,032
    
NON-CURRENT LIABILITIES   
Deferred income from connection fees27,01720,47522,745
Borrowings90,53495,23991,919
Derivatives115181173
Provision for possible third party claims19,06817,52219,068
Other payables454746
TOTAL NON-CURRENT LIABILITIES136,779133,464133,951
TOTAL LIABILITIES154,131145,616146,983
    
EQUITY   
Share capital 12,00012,00012,000
Share premium24,73424,73424,734
Statutory legal reserve1,2781,2781,278
Retained earnings59,22952,60264,753
TOTAL EQUITY97,24190,614102,765
TOTAL LIABILITIES AND EQUITY251,372236,230249,748
    
    
CASH FLOWS STATEMENT6 months6 months12 months
(€ thousand)201920182018
    
CASH FLOWS FROM OPERATING ACTIVITIES   
Operating profit13,49414,33726,939
Adjustment for depreciation/amortisation2,9692,8395,790
Adjustment for revenues from connection fees-179-141-295
Other non-cash adjustments0-11-20
Profit/loss(+) from sale and write off of property, plant and equipment, and intangible assets-5-39-115
Change in current assets involved in operating activities-663-42754
Change in liabilities involved in operating activities5704841,939
TOTAL CASH FLOW FROM OPERATING ACTIVITIES16,18617,04234,292
    
CASH FLOWS FROM INVESTING ACTIVITIES   
Acquisition of property, plant and equipment, and intangible assets-3,093-3,418-10,736
Compensations received for construction of pipelines, incl connection fees1,6681,6763,716
Proceeds from sales of property, plant and equipment and intangible assets767160
Interest received15817
TOTAL CASH FLOW FROM INVESTING ACTIVITIES-1,403-1,667-6,843
    
CASH FLOWS FROM FINANCING ACTIVITIES   
Interest paid and loan financing costs, incl swap interests-509-710-1,394
Lease payments-209-120-258
Repayment of loans-1,81800
Dividends paid-14,965-7,201-7,201
Income tax on dividends -156-163-1,800
TOTAL CASH FLOW FROM FINANCING ACTIVITIES-17,657-8,194-10,653
    
CHANGE IN CASH AND CASH EQUIVALENTS-2,8747,18116,796
    
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD61,76944,97344,973
    
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD58,89552,15461,769


Karl Heino Brookes

Chairman of the Management Board

+372 62 62 200

karl.brookes@tvesi.ee


Attachment


Q2 2019 final report ENG.pdf