Elering’s Q4 Financial Results

In the fourth quarter of 2014, Elering’s revenue was 36.0 million euros, operating profit 14.8 million euros and net profit 11.9 million euros.

Revenue fell by 5.5 million and operating costs by 1.4 million euros compared to Q4 of 2013. The main reason for the fall in revenue was the change in accounting principles for recording the cross-border transmission capacity auction profits (-5.8 million euros) on July 1, 2014. Since then, the profits are channelled to a special fund created for increasing the north-south transmission capacity in the Estonian electricity system, including the financing of the Estonia-Latvia third interconnection’s construction.

Revenue from the domestic transmission of electricity fell by 0.8 million euros. According to Peep Soone, CFO of Elering, the reason for the fall in transmission revenue collected from Estonian consumers lies in the lower tariffs that took effect on April 1, 2014. The lower tariffs were partly compensated by the 6.1 per cent growth of physical volumes of domestic electricity transmission mainly due to colder temperatures compared to the same quarter in 2013. Revenues from the sale of balance services dropped by 0.8 million euros. Financial costs in accounting grew by 1.7 million euros, because of the decline in the capitalised interest due to the completion of large investment projects.

Cash flow from operations was 17.0 million euros and investments into non-current assets were 9.8 million euros. In addition, the proceeds from cross-border transmission capacity auctions amounted to 11.8 million euros. The cash (31.9 million euros) at the end of the quarter was higher than usual due to Elering purchasing the majority share in the gas transmission network on January 2, 2015.

Elering is Estonia’s independent and standalone transmission system operator, whose main task is to ensure that Estonia’s consumers enjoy a consistent, high-quality electricity supply. To ensure the security of supply, Elering maintains and develops the domestic transmission network and external interconnections. Elering manages Estonia’s electricity system in real time, ensuring the functioning of the transmission network and the balance between output and consumption.

Elering’s Q4 financial results are available here.