TAURON Group s 213 FY financial results March 18, 214
213 key financial parameters TAURON Group s results [PLN m] 213 Sales revenue 19 131 (-22.7% yoy) EBITDA 3 661 (-4.9% yoy) Net profit 1 346 (-13.2% yoy) CAPEX 3 78 (8.9% yoy) Net debt/ebitda 1.43 (up.25) Key segments 213 results [PLN m] Distribution Supply Heat Mining Generation Segment s revenue 5 997 18 18 1 189 1 398 4 723 EBITDA 2 28 899 232 166 32 EBIT 1 296 865 127 66 (475) CAPEX 2 81 21 22 257 521 2
Q4 213 key financial parameters TAURON Group s Q4 213 results [PLN m] Q4 213 Sales revenue 4 922 (-24.7% yoy) EBITDA 665 (-13.7% yoy) Net profit 86 (-6.6% yoy) CAPEX 1 411 (-4.3% yoy) Net debt/ebitda 1.43 (up.25) Key segments Q4 213 results [PLN m] Distribution Supply Heat Mining Generation Segment s revenue 1 551 4 716 363 35 1 284 EBITDA 512 152 7 (2) (88) EBIT 276 144 44 (23) (214) CAPEX 889 6 86 83 118 3
213/214 events summary TAURON (1) Date Event January 15, 213 Adoption by TAURON Group of the operational efficiency improvement program for 213-215. Estimated savings: approx. PLN 86m January 24, 213 Selection of the RAFAKO-Mostostal Warszawa consortium for the Jaworzno III 91 MW project. Estimated total project budget: PLN 6.2bn March 1, 213 Signature of the contract with Kompania Węglowa for hard coal supplies in 213-215 June 18, 213 June 6, 213 July 5, 213 Payout of the PLN 35.5m dividend from the 212 profit (dividend per share: PLN.2) ERO President s decision on the G tariff s reduction by 4.55 percent for TAURON Supply in the second half of 213. Impact on the Supply s revenue: - PLN 45.5m Decision on the generation assets impairment charge of PLN 236.5m July 31, 213 September 2, 213 December 1, 213 Signature of the agreements related to bond issues with the consortium of banks: ING Bank Śląski, Bank Polska Kasa Opieki, BRE Bank (offering value: up to PLN 5bn) and with Bank Gospodarstwa Krajowego (offering value: up to PLN 1bn) ERO President s decision on the final adjustment of TAURON Generation s stranded costs. Impact on TAURON Group s earnings: - PLN 19m. Resignation from the 135 MW CCGT unit s construction in Katowice (TAURON Heat) 4
213/214 events summary TAURON (2) Date Event December 1, 213 December 17, 213 December 3, 213 December 31, 213 Acquisition from Kompania Węglowa of 47.52 percent of Południowy Koncern Węglowy s (PKW) shares. Deal value: PLN 31m. As a result TAURON owns 1 percent of shares and votes in PKW. On February 24, 214 the change of PKW s name to TAURON Mining (TAURON Wydobycie) was registered in the National Court Register (KRS) ERO President s decision on the distribution tariff s increase by 2.69 percent for TAURON Distribution in 214. Estimated impact on the Distribution s revenue: + PLN 132m ERO President s decision on the G tariff s reduction by 6.19 percent for TAURON Supply in 214. Impact on the Supply s revenue: - PLN 117m Decision on suspending the CCGT unit s construction at Blachownia Power Plant (8 MW) End of TAURON Polska Energia s involvement in the shale gas exploration and extraction project 213 Commissioning of the following investment projects: Marszewo (82 MW) and Wicko (4 MW) wind farms 5 MW e /16 MW t heat unit in Bielsko-Biała 2 MW biomass-fired unit in Stalowa Wola and 4 MW biomass-fired unit in Tychy January 28, 214 March 4, 214 Decision on setting up an additional PLN 27m provision for free of charge CO 2 emission allowances not received in 213. Negative impact on 213 EBITDA: - PLN 27m Resolution of the tender for providing the cold capacity reserve for intervention purposes (IRZ) service. The service will be provided by TAURON Generation s three 12 MW units (two at the Siersza Power Plant and one at the Stalowa Wola Power Plant) 5
213/214 events summary MARKET Date Event January 213 September 11, 213 September 17, 213 Expiration of the support system for high efficiency rate coal- and gas-fired co-generation. On January 24, 214 Polish Parliament (Sejm) extended support for co-generation until 218. Coming into force of the amended Energy Law. Among others an obligation was introduced for gas trading companies to sell some gas via the public gas exchange Ministry of Economy presents the draft RES law that includes a new proposal on the support system for renewable energy sources (auction system) December 213 ERO President s decision on the G tariff s reduction by between -6.5 percent and -6.2 percent in 214 ERO President s decision on the distribution tariff s increase by between.6 percent and 6.6 percent in 214 January 214 February 24, 214 Coming into force of the operational capacity reserve mechanism. Estimated annual budget of PSE S.A. is approx. PLN 4m Coming into force of the backloading mechanism EU s plan to temporarily reduce the number of emission allowances on the market. In 214-216 the EUA pool on the market will be reduced by 9m in total. As a consequence of this decisionon February 24 the EUA price went up to approx. 7.3 EUR/t 6
Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Macroeconomic and market situation GDP 5% 4% 3% 2% 1% % Poland's GDP growth rate* and manufacturing PMI index (quarterly average) -.1 p.p. PMI 55 54 53 52 51 5 49 48 47 46 12% 1% 8% 6% 4% 2% % -2% -4% Increase of industrial production sold and electricity consumption (change yoy)* -.7 p.p. GDP grow th GDP grow th forecast Manufacturing PMI increase of production sold change of domestic electricity consumption forecast increase of production sold Yearly BASE contract prices on the Polish Power Exchange (TGE) Structure of electricity production in Poland [TWh] 22 21 2 19 zł/mwh Y-13 Y-14 Y-15 Y-16 18 Average price Volume 17 [PLN/MWh] [GWh] 16 Y-13 185.92 66 786 Y-14 156.46 1 74 Y-15 161.78 24 388 15 Y-16 169.25 2 17 14 lip 11 lis 11 kwi 12 sie 12 sty 13 maj 13 paź 13 lut 14 TWh 18 16 14 12 1 8 6 4 2 8.4% 3.9% 34.8% 52.9 % +1.6% 159.8 162.5-8.6% 13.48 12.32 6.29 +37.6% 8.66 55.59 +2.5% 56.96 84.49 +.1% 84.57 212 213 7.6 % 5.3 % 35.1% 52% pozostałe odnawialne źródła energii el. cieplne na węgiel brunatny el. cieplne na węgiel kamienny * Source: GUS, IBnGR (forecasts), PSE 7
213 key operating data Mg m Coal production and sales [tons m] TWh 25 Electricity [TWh] and heat [PJ] generation PJ 18 6, 5, 4, 1.66 1.81 9.% 2 15 19.11 19.39 1,21 14.% 1.38 16 14 12 1 3, 2, 1,, 5.57 5.45 3,73 3.67-1.6% -2.2% 212 213 sprzedaż intra-group węgla coal do sales Grupy sprzedaż coal sales węgla outside poza the Grupę Group produkcja commercial węgla coal handlowego production 1 5 16.36 15.62 17.9 18.1.6% -4.5% 212 213 energia electricity elektr. energia electricity elektr. - RES - OZE ciepło heat 8 6 4 2 TWh 5 45 4 35 3 25 2 15 1 5 Electricity distribution [TWh] and number of customers [thou.] 47.85 47.9 5 334 5 32.1% 32 thou. 212 213 customers 5 4 5 35 5 3 5 25 5 2 Electricity supply [TWh] 44.74 41.3 212 213 TWh 49 42 35 28 21 14 7-7.7 % dystrybucja electricity energii distribution elektr. liczba number klientów of customers sprzedaż retail electricity detaliczna sales energii elektrycznej 8
Q4 213 key operating data Mg m 1,8 1,6 1,4 1,2 1,,8,6,4,2, Coal production and sales [tons m] Electricity [TWh] and heat [PJ] generation 6 5,2 5.11 5.29 58.6 %.47.44 4 1.48.41-6.8% 3 5.68 4.72 4.64 1.19 2 5.3.99.79 1-2.2% -19.6% -1.7% -11.4% Q4 212 Q4 213 Q4 212 Q4 213 sprzedaż intra-group węgla coal do sales Grupy sprzedaż coal sales węgla outside poza the Grupę węgiel commercial handlowy coal energia electricity elektr. energia electricity elektr. - RES - OZE ciepło heat Group TWh PJ 6 5 4 3 2 1 TWh 16 Electricity distribution [TWh] and number of customers [thou.] customers 5 4 Electricity supply [TWh] TWh 14 14 12 12 5 35 1 1 8 6 4 12.13 12,18 5 32 5 334 5 3 5 25 11.37 1.59 8 6 4 2 +.4% 32 thou. Q4 212 Q4 213 5 2 Q4 212 Q4 213-6.9% 2 dystrybucja electricity energii distribution elektr. liczba number klientów of customers sprzedaż retail electricity detaliczna sales energii elektrycznej 9
213 key financial data PLN m 25 2 15 1 5 Sales revenue [PLN m] 24 753 3 19 19 131 5 763-26.6% 2 281-1.1% 5 72 15 882 11 148 212 213-29.8% Net profit [PLN m] 1 551 1 346 212 213-13.2% PLN m 1 8 1 6 1 4 1 2 1 8 6 4 2 distribution and trading energia electricity elektr. usługi dystrybucyjne i handlowe pozostałe other revenue przychody services PLN m 4 5 4 3 5 3 851.6 212 EBITDA [PLN m] 213 EBITDA [PLN m] 3 284.6 +29.9% 4 268.3 +27. +18.9 +42.3 +275.6 3 661.5 3-567. 2 5 2 1 5 1 5 EBITDA raportowana Reported EBITDA Przychody z tytułu rekompensaty (KDT) Compensation (LTC) revenue EBITDA porównywalna Comparable EBITDA EBITDA Comparable porównywalna EBITDA Koszt CO2 CO2 (brak przydziału cost (lack uprawnień) of allocation of allowances) Przychody LTC z tytułu rekompensat KDT compensation (korekta rozl. revenue końcowe) (final settlement adjustment) Odpis aktualizujący Inventory wartość zapasów impairment charge Odpis aktualizujący Asset wartość impairment aktywów charge EBITDA raportowana Reported EBITDA 1
Q4 213 key financial data PLN m 7 6 5 4 3 6 539 936 1 481 Sales revenue [PLN m] -37.3% 3.7% 4 922 587 1 536 218 Net profit [PLN m] 86 PLN m 25 2 15 1 2 1 4 122 2 799 IV Q4 kw. 212 Q4 IV 213 kw. 213-32.1% Q4 212 Q4 213-6.6% 5 distribution and trading energia electricity elektr. usługi dystrybucyjne i handlowe pozostałe other revenue przychody services PLN m 1 Q4 212 EBITDA [PLN m] 965.4 Q4 213 EBITDA [PLN m] +27. 8 6 77.4-135.8 634.6 +52.1% +3.4 665. 4 2 EBITDA raportowana Reported EBITDA Przychody z tytułu rekompensaty (KDT) Compensation (LTC) revenue EBITDA Comparable porównywalnaebitda EBITDA porównywalna Comparable EBITDA Koszty CO2 (brak CO2 przydziału cost (lack uprawnień) of allocation of allowances) Odpis aktualizujący wartość Asset impairment aktywów charge EBITDA raportowana Reported EBITDA 11
213 EBITDA PLN m -5.% EBIT Depreciation Segment growth 5 15.6% 4 5 11.9%.7% 66.3% 19.5% 36.8% 5.% 9.2% 5.6% - 19.1% 4 3 852 421 2 57 3 661 3 5 1 686-122 252-25 1 727 3 2 5-755 -8-31 2 2 165 1 5 1 934 1 5 EBITDA 212 EBITDA 212 Wydobycie Mining Wytwarzanie Generation OZE RES Ciepło Heat Dystrybucja Distribution Sprzedaż Supply Obsługa Customer klienta Pozostałe Other Unassigned Pozycje EBITDA 213 EBITDA 213 Service nieprzypisane items Most important factors affecting EBITDA in 213: Generation no revenue from LTC compensations, assets impairment charge, setting up a provision for the CO 2 emission allowances and lower wholesale market electricity prices Supply - declining cost of the obligation to redeem green, red and yellow cerificates as a result of a drop of green property rights market prices and lack of obligation to redeem cogeneration related property rights, large spread between retail and wholesale electricity prices Distribution decline of the unit cost of purchasing distribution services (including: lower transmission charges, lower cost of purchasing electricity to cover the balancing difference due to the lower grid loss rate (factor) and lower costs of purchasing electricity) Mining declining coal market prices 12
Q4 213 EBITDA PLN m -13.7% 1 9 8 7 6 5 4 3 2 1 EBIT Amortyzacja Depreciation Wzrost Segment w segmencie growth 11.8% -.7% -6.9% 68.4% 19.4% 33.% 3.2% -22.3% 4.4% - 13.5% 77 437 333-39 Most important factors affecting EBITDA in Q4 213: Generation no revenue from LTC compensations, costs of the CO 2 emission allowances related provision and lower wholesale market electricity prices Supply - declining cost of the obligation to redeem green, red and yellow cerificates as a result of a drop of green property rights market prices and lack of obligation to redeem co-generation related property rights, large spread between retail and wholesale electricity prices Distribution decline of the unit cost of purchasing distribution services (lower transmission charges, lower cost of purchasing electricity to cover the balancing difference) Mining declining coal market prices, lower coal sales volume Heat costs of the CO 2 emission allowances related provision, sale of the CO 2 emission allowances surplus in Q4 212 RES larger volume of wind farm generated electricity and property rights sales 34-28 -39 112 22-14 -2 Q4 EBITDA 212 EBITDA IV kw. Wydobycie Mining Wytwarzanie Generation OZE RES Ciepło Heat Dystrybucja Distribution Sprzedaż Supply Obsługa Customer klienta Pozostałe Other Unassigned Pozycje EBITDA Q4 213 IV kw. 212 Service nieprzypisane items EBITDA 213 3 665 44 225 13
213 prime costs structure Prime costs structure Struktura kosztów rodzajowych PLN m 213 2 8 2 443 19% 23% 2 514 1 76 2 668 117 23% 1% 25% 1.1% 1 827 Fixed costs 6% Variable costs 4% -1.8% 212 Fixed costs 63% Variable costs 37% 1 595 2 855 2 689 632 2 93 32 14% 26% 24% 6% 27% 2.9% 11 21 % 2% 4% 6% 8% 1% 12% 1 595 Depreciation and impairment charges of Amortyzacja i odpisy aktualiz. ŚT i WN Zużycie Consumption materiałów of materials i energii and Usługi External obce Podatki i opłaty Koszty świadczeń pracowniczych Pozostałe koszty rodzajowe fixed assets and goodwill Taxes and fees Employee benefit costs Other prime costs energy services Declining costs in 213 are mainly due to: external services including distribution and transmission services (yoy reduction of the TSO transmission charge) employee benefit costs mainly the result of the Voluntary Redundancy Programs implemented and the lower headcount consumption of materials and energy due to lower fuel costs Increased costs in 213 are mainly due to: depreciation (including generation assets impairment charge of approx. PLN 276m) taxes and fees costs of the provision set up for the CO 2 emission allowances Cost structure: 213: variable costs (excluding the value of goods and materials sold) approx.4%, fixed costs approx. 6% 212: variable costs approx. 37%, fixed costs approx. 63% Change of structure caused by: Generation and Heat: reduction of variable costs (lower fuel costs), inclusion of the generation assets impairment charge (in fixed costs) Distribution: lower transmission charge costs 14
Q4 213 prime costs structure IV kw. 213 Prime costs structure 476 658 677 495 743 4 16% 22% 22% 16% 24%.1% Fixed costs 59% Variable costs 41% PLN m 3 54-8.5% Fixed costs 6% Variable costs 4% IV kw. 212 438 875 732 172 96 211 13% 26% 22% 5% 27% 6% 3 336 % 2% 4% 6% 8% 1% 12% Amortyzacja Depreciation i and odpisy impairment aktualiz. charges ŚT i WN of Consumption of materials and External Zużycie materiałów i energii Usługi obce Podatki Taxes and i opłaty fees Koszty Employee świadczeń benefit costs pracowniczych Pozostałe Other prime koszty costs rodzajowe fixed assets and goodwill energy services Declining costs in Q4 213 are mainly due to: consumption of materials (lower fuel costs) employee benefit costs mainly the result of the Voluntary Redundancy Programs implemented and the lower headcount external services including distribution and transmission services (yoy reduction of the TSO transmission charge) Cost structure: Q4 213: variable costs (excluding the value of goods and materials sold) approx.41%, fixed costs approx. 59% Q4 212: variable costs approx. 4%, fixed costs approx. 6% In Q4 213 the cost structure did not differ from the cost structure in Q4 212, with fixed costs as well as variable costs declining in the given period 15
Debt and financing PLN m 3 5 3 2 5 2 1 5 1 5 - TAURON Group s debt maturity [PLN m] 3 153 1 493 195 15 158 14 14 14 89 82 61 214 215 216 217 218 219 22 221 222 223 224 obligacje bonds kredyty, credits, pożyczki loans and i lease leasingi arrangements Struktura TAURON zadłużenia Group s long finansowego term debt Grupy structure[pln TAURON m] [mln zł] 66 1% 1 288 22% 17 2% obligacje bonds 5 759 4 298 75% kredyty EIB loans z EBI preferential terms loans from National/Regional pożyczki preferencyjne Environment Protection z Funds NFOŚiGW/WFOSiGW pozostałe other credits, kredyty, loans and pożyczki lease arangements i leasingi financial debt as of December 31, 213: PLN 5 759m net debt / EBITDA ratio: 1.19 (versus 1.18 at the end of 212) average weighted debt maturity as of December 31, 213: excluding BGK bonds 39 months including BGK bonds 53 months EUR debt constitutes.4% of the total debt structure of debt by interest rate 22% fixed interest rate, i.e. PLN 1 288m 78% floating interest rate, i.e. PLN 4 471m, including: - unsecured amount PLN 1 31m - secured amount PLN 3 44m 1 25% Kwoty Financing dostępnego available finansowania to TAURON Grupy Group TAURON [PLN m] [mln zł] 211 5% 3 691 2 75 7% bonds underwritten obligacje obejmowane przez by the konsorcjum consortium banków of banks obligacje BGK bonds BGK cashpooling 16
CAPEX key projects (1) Investment project Capacity (MW e ) Capacity (MW t ) Project status Progress (in %) Planned completion date Construction of the hard coal-fired unit at the Jaworzno III Power Plant Construction of the CCGT unit at the Stalowa Wola Combined Heat and Power Plant Construction of the hard coal-fired co-generation unit at ZW Tychy Construction of the TG 5 ZW Nowa turbogenerator Upgrade of 6 boilers at the Jaworzno III Power Plant installing the flue gas denitrification systems Upgrade of 4 boilers at the Łaziska Power Plant installing the flue gas denitrification systems Construction of the CCGT unit at the Łagisza Power Plant Construction of new RES capacity at the Stalowa Wola Power Plant Construction of the 8m level at the Janina coal mine Construction of the Grzegorz shaft at the Sobieski coal mine 8-91 - 45 24 5 86 Preparations underway to sign the contract with the RAFAKO S.A. MOSTOSTAL WARSZAWA S.A. consortium. Construction site is ready to be handed over to the contractor. Construction and installation works underway as well as deliveries of machines and equipment for individual technological nodes and unit s installations. Contract with the general contractor - Elektrobudowa S.A., signed. Construction site handed over. Implementation works underway. 5 % 219 47 % 215 5 % 216 5 - Contract with the general contractor - Control Process S.A., signed. 15 % 215 - - - - 413 266 55 - - Upgrade works underway. Works completed on three 2 MW units. Main objective of the project is to comply with the requirements with respect to NOx emissions values to be permitted past 218 (2 mg/nm 3 ). Upgrade works underway. Works completed on two 2 MW units. Main objective of the project is to comply with the requirements with respect to NOx emissions values to be permitted past 218 (2 mg/nm 3 ). Works underway related to preparations for the selection of the unit s contractor and optimizing the gas fuel supply source. Documentation and rules of selecting the contractor to upgrade the unit s equipment prepared for the purpose of running the tender proceeding. Janina VI shaft deepening and upgrading of the Hard Coal Mechanical Processing Unit commenced. 5 % 216 75 % 215-218 3 % 215 6 % 219 - - Design works and preparation of the construction site underway. 1 % 222 17
CAPEX per segment (2) CAPEX per segment [PLN m] +8.9% 3 78 3 472 112 99 2 81 1 786 34 67 222 22 857 521 167 257 Wykonanie Wykonanie 212 213 212 213 Wydobycie Mining Wytwarzanie Generation Ciepło Heat OZE RES Dystrybucja Distribution Sprzedaż Supply and i pozostałe other Main investment projects completed in 213: Distribution construction of new connections (PLN 516m) and upgrade and restoration of grid assets (PLN 1 318m) RES construction of the Marszewo and Wicko wind farms (PLN 517m) Generation construction of new generation capacity (PLN 118m) and construction of the NOx emission reduction system (PLN 224m) Mining investment projects related to gaining access to hard coal deposits (PLN 257m) Heat construction and upgrades of the heat tranmission pipeline networks (PLN 14m) 18
OPEX reduction program Segment Savings realized in Q1-Q4 213 Savings planned for 213-215 Progress % Distribution PLN 13m PLN 416m 31% Generation (including RES) PLN 145m PLN 387m 37% Heat PLN 2m PLN 33m 6% Mining PLN 15m PLN 28m 54% Other segments PLN 1m Total PLN 32m PLN 864m 37% Main initiatives Implementation of the ultimate business model, elimination of the redundant functions Change of the way expenses are classified as CAPEX or OPEX Optimization of the balancing difference IT processes optimization Integration of business functions in the support (maintenance) area Optimization of external services Employment restructuring and process optimization Reduction of upgrades (maintenance) for the least efficient units Overhead cost optimization Outsourcing of some functions, mainly in the maintenance area Improvement of the devices efficiency, optimization of the production volume and operating expenses at hydorelectric power plants Reduction of the costs of support and maintenance of the wind farm s operation Employment restructuring Compressed air losses reduction Asset restructuring External services costs optimization Procurement policy optimization Nitrogen production system construction Coal sludge (slurry) dewatering station expansion Potable water treatment Electronic auctions in public procurement Use of the mechanical lining when drilling headings End of maintaining EPOK, End of maintaining TS GZE s website, employment restructuring, reduction of external services costs In Q1-Q4 213 the voluntary redundancy program covered 34 persons. Over that period employment contracts were terminated with 733 persons (3 227 persons in total since the program s launching in 21). Savings resulting from redundancies, decreased by costs incurred to generate those savings, are included in the amounts presented per segment. No threat for the plan s implementation is envisaged. Structure of savings in Q1-Q4 213: 58% comes from employment restructuring, 42% from the other initiatives. Estimated structure of savings in the 213-215 time frame: 73% to come from employment restructuring, 27% from the other initiatives. 19
Summary growth drivers in 214 WACC drop negative impact on Distribution in 214 Introduction of the operational capacity reserve mechanism Declining electricity prices negative impact on Generation in 214 TAURON Group Lower CO 2 emission allowances prices Introduction of backloading Introduction of the obligation to redeem yellow and red certificates 2
Legal disclaimer This presentation serves for information purposes only and should not be treated as investment-related advice. This presentation has been prepared by TAURON Polska Energia S.A. ( the Company ). Neither the Company nor any of its subsidiaries shall be held accountable for any damage resulting from the use of this presentation or a part thereof, or its contents or in any other manner in connection with this presentation. The recipients of this presentation shall bear exclusive responsibility for their own analyses and market assessment as well as evaluation of the Company s market position and its potential results in the future based on information contained in herein. To the extent this presentation contains forward-looking statements related to the future, in particular such terms as designed, planned, anticipated, or other similar expressions (including their negation), they shall be connected with the known and unknown risks, uncertainty and other factors which might result in actual results, financial situation, actions and achievements being materially different from any future results, actions or achievements expressed in such forward-looking statements. Neither the Company nor any of its subsidiaries shall be obliged to provide the recipients of this presentation with any additional information or to update this presentation 21
Thank you Q&A Investor Relations Office Marcin Lauer marcin.lauer@tauron-pe.pl tel. + 48 32 774 27 6 Paweł Gaworzyński pawel.gaworzynski@tauron-pe.pl tel. + 48 32 774 25 34 Magdalena Wilczek magdalena.wilczek@tauron-pe.pl tel. + 48 32 774 25 38
Key financial ratios Ratio Definition 213 212 211 PROFITABILITY EBIT margin Operating profit / Sales revenue 1.11% 8.75% 7.93% EBITDA margin EBITDA / Sales revenue 19.14% 15.56% 14.73% Net profitability Net profit / Sales revenue 7.4% 6.27% 6.1% Return on equity (ROE) Net income/ Shareholders equity at the end of period 7.57% 9.23% 7.85% LIQUIDITY Current liquidity ratio Current assets/ Current liabilities.9 1.7 1.5 DEBT Debt ratio Total debt / Total assets.45.46.43 Net debt / EBITDA OTHER INDICATORS (Interest bearing liabilities cash or cash equivalents) / EBITDA 1.43 1.18 1.32 Earnings per share (EPS) Net profit / number of ordinary shares.75.84.72 23
Mining 1 5 1 2 9 6 3 1 478 213 financial data [PLN m] 213 EBIT bridge [PLN m] 287 175 1 398 166 212 213 Przychody Sales revenue ze sprzedaży EBITDA EBIT 66 2 18 16 14 12 1 8 6 4 2 175 2.1-62.4% -15.2-2.8 EBIT 212 Wolumen sprzedaży Cena sprzedaży Jedn. koszt własny Pozostałe czynniki EBIT 213 212 EBIT Coal węgla sales Coal węgla sales sprzedanego Own per węgla unit Other 213 EBIT volume price cost of coal sold factors -3.3 66 Q4 213 financial data [PLN m] Q4 213 EBIT bridge [PLN m] 5 4 3 386 35 15 1 5 1 -.6-23 2-5 -1 1-1 37 1-2 -23 Q4 IV 212 kw. 212 IV Q4 kw. 213 213 Przychody Sales revenue ze sprzedaży EBITDA EBIT -15-2 -25-3 EBIT Q4 212 IV kw. EBIT 212-24.2 4.3-12.8 Wolumen Coal sales sprzedaży Cena Coal sprzedaży sales Jedn. Own koszt per własny unit Pozostałe Other czynniki volume węgla price węgla sprzedanego cost of coal węglasold factors EBIT IV kw. Q4 213 213 EBIT 24
Generation (conventional sources) PLN m 6 5 5 565 213 financial data [PLN m] 213 EBIT bridge [PLN m] 6 79.2 19.4 4 723 4 265.2 229.7 272 4 3 2 1-1 787 272 32-475 212 213 Przychody Sales revenue ze sprzedaży EBITDA EBIT 2-2 -4-6 EBIT 212 212 EBIT -41.1-212.2-567. 33.6-275.6 Electricity Cena Electricity Jednostkowy Electricity Marża na Marża Margin na on PM, CO2 Koszty costs CO2 Fixed Koszty costs stałe Przych. LTC z tyt. Generation Odpis Pozostałe Other sales sprzedaży price per koszt unit zmienny trading obrocie property wycena PM rights rekompensaty compensation aktualizujący assets czynniki factors energii energii el. energią el. KDT aktywa variable margin property rights revenue impairment wytwórcze cost valuation charge -475 EBIT 213 213 EBIT Q4 213 financial data [PLN m] Q4 213 EBIT bridge [PLN m] 2 1 679 15 13.5 36.1 1 5 1 5-5 1 284 12-22 -88-214 IV Q4 kw. 212 212 IV Q4 kw. 213 Przychody Sales revenue ze sprzedaży EBITDA EBIT 5-5 -15-25 -35-45 -22 86.7-214 -135.8-55.1 95..4-31.4-291.1 EBIT IV kw. Q4 212 EBIT Cena Jednostkowy Marża na Marża na Przychody z Koszty CO2 Koszty stałe Odpis Pozostałe Electricity sprzedaży koszt Electricity zmienny certyfikatach Margin on Electricity obrocie LTC tyt. CO2 costs Fixed costs aktualizujący Generation czynniki Other sales energii price per energii unit el. variable certificates trading energią el. margin compensation rekompensaty revenue KDT assets aktywa wytwórcze impairment factors cost charge EBIT IV kw. Q4 213 213 EBIT 25
Renewable Energy Sources (RES) 25 2 15 1 5 213 financial data [PLN m] 213 EBIT bridge [PLN m] 27 24 143 14 136 212 213 Przychody Sales revenue ze sprzedaży EBITDA EBIT 93 mln zł 2 18 16 14 12 1 8 6 4 2 14 8. 23.8 1.7-1.5% 32.8-75.1-2.9 EBIT 212 Wolumen Wolumen Wolumen Wolumen Cena sprzedaży Cena sprzedaży Pozostałe EBIT 213 212 EBIT sprzedaży Electricity sprzedaży Electricity sprzedaży Certificates sprzedaży Certificates certyfikatu Certificate Electricity energii Other 213 EBIT czynniki energii sales - volume el. energii sales volume - certyfikatów sales volume - el. certyfikatów sales volume - sales price sales price factors wodne - hydroelectric el.wiatrowe - wind farms - wodne hydroelectric el.wiatrowe - wind farms power plants power plants -8.2 93 8 7 6 5 4 3 2 1 39 Q4 213 financial data [PLN m] 18 1 76 52 36 8 7 6 5 4 3 2 1 1 2.3 Q4 213 EBIT bridge [PLN m] +275.1% 37. -2.8 2. 2.9-23.4-9.5 36 IV Q4 kw. 212 212 IV Q4 kw. 213 Przychody Sales revenue ze sprzedaży EBITDA EBIT EBIT IV kw. Q4 212 212 EBIT Wolumen Electricity Wolumen Electricity Wolumen Certificates Wolumen Certificates Cena Electricity sprzedaży Cena Certificate sprzedaży Pozostałe Other sprzedaży sales volume sprzedaży sales volume sprzedaży sales volume sprzedaży sales volume sales energii price sales certyfikatu price factors czynniki energii - hydroelectric - el. - energii wind farms - certyfikatów - hydroelectric - certyfikatów - wind farms - power wodneplants el.wiatrowe el.wodne power plants el.wiatrowe EBIT IV kw. Q4 213 EBIT 213 26
Heat 1 25 95 65 35 1 136 213 financial data [PLN m] 1 189 263 232 17 127 25 2 15 1 17-2.4 43.8 213 EBIT bridge [PLN m] -25.% 11.1 13.9-45.6-32.9-24.7 12.4 127 5 5-25 212 213 Przychody Sales revenue ze sprzedaży EBITDA EBIT EBIT IV kw. 212 212 EBIT Cena Electricity sprzedaży Cena Heat sprzedaży and Wolumen Electricity Generation Jednostkowe Sprzedaż CO2 sales CO2 Impairment Odpis CO2 Koszty provision rezerwy Pozostałe Other energii ciepła i usługi sprzedaży koszty zmienne (212) aktualizujący - CO2 czynniki sales transmission sales per unit (212) charge - costs factors przesyłowej energii el. wytwarzania certyfikaty price service price volume variable costs certificates EBIT IV kw. 213 EBIT Q4 213 financial data [PLN m] Q4 213 EBIT bridge [PLN m] 4 35 3 25 2 15 1 5 341 19 85 363 7 44 125 15 85 65 45 25 5 85-6.7 9.3 3.6-48.3% 9.2-45.6-17.9 7. 44-5 IV Q4 kw. 212 212 IV Q4 kw. 213 213 Przychody Sales revenue ze sprzedaży EBITDA EBIT -15 Q4 EBIT 212 IV kw. EBIT 212 Electricity Heat and Electricity Generation CO2 sales CO2 provision Other Cena sales sprzedaży Cena transmission sprzedaży Wolumen sales Jednostkowe per unit Sprzedaż (212) CO2 Koszty costs rezerwy Pozostałe factors czynniki price energii service ciepła i price usługi sprzedaży volume energii koszty variable zmienne costs (212) CO2 przesyłowej el. wytwarzania EBIT Q4 IV 213 kw. EBIT 213 27
Distribution PLN m 6 5 4 3 2 1 6 77 5 997 1 956 213 financial data [PLN m] 213 EBIT bridge [PLN m] 1 77 2 28 1 296 212 213 Przychody Sales revenue ze sprzedaży EBITDA EBIT PLN m 1 6 1 4 1 2 1 8 6 4 2 1 77-41.7-8.2 6.3 7.2 +2.3% 31.8 15.5-34.2-25. -3.5 EBIT 212 Cena Opłaty Wskaźnik Cena zakupu Cena zakupu Koszty stałe Amortyzacja Wynik na Pozostałe EBIT 213 212 EBIT Distribution sprzedaży przyłączeniowe Connection Balancing różnicy Price energii of purchasing na Price usługi of Fixed costs Depreciation Result pozostałej from czynniki Other 213 EBIT service uslugi sales fees difference bilansowej electricity pokrycie to cover dystrybucyjnej purchasing other działalności factors dystrybucyjnej price indicator balancing różnicy / przesyłowej distribution/ operations operacyjnej difference bilansowej transmission service 1 296 Q4 213 financial data [PLN m] Q4 213 EBIT bridge [PLN m] 1 6 1 2 1 567 1 551 35 3 25 +55.7% 32.1 76.1 19. -32.2 11.3 276 8 4 4 177 512 276 2 15 1 5 177-26.2 5.3 28.6-15.3 IV Q4 kw. 212 212 Q4 IV kw. 213 213 Przychody ze sprzedaży Sales revenue EBITDA EBIT EBIT IV kw. Q4 212 EBIT Q4 212 212 EBIT Distribution Cena Distribution Wolumen Balancing Wskaźnik Price Cena of zakupu purchasing Cena Price zakupu of Koszty Fixed stałe costs Result Wynik na from Result Wynik from na Pozostałe Other service sprzedaży sales sprzedaży fees difference różnicy electricity energii to nacover usługi purchasing pozostałej other core pozostałej other czynniki factors price uslugi usługi bilansowej indicator balancing pokrycie dystrybucyjnej distribution/ działalności operations działalności operations dystrybucyjnej dystrybucyjnej difference różnicy bilansowej / przesyłowej transmission service podstawowej operacyjnej EBIT IV kw. Q4 213 213 EBIT 28
Distribution key elements 212 electricity distribution [TWh] 213 electricity distribution [TWh] 4.2 9.9 45.2 13.9 Grupa Group A Grupa Group B Grupa Group C2 Grupa Group C1+R+D + R + D Grupa Group G 4.1 2.6 9.9 45.2 13.6 Grupa Group A Grupa Group B Grupa Group C2 Grupa Group C1+R+D + R + D Grupa Group G 2.6 14.6 14.9 Q4 212 electricity distribution [TWh] Q4 213 electricity distribution [TWh] 2.5 3.4 Grupa Group A 2.5 3.4 Grupa Group A Grupa Group BB Grupa Group B 1.1 11.3 Grupa Group C2 1.1 11.4 Grupa Group C2 Grupa Group C1+R+D + R + D Grupa Group C1+R+D + R + D.7 Grupa Group G.7 Grupa Group G 3.7 3.8 Data is related to the distribution of electricity to end users 29
Supply 2 15 1 5 213 financial data [PLN m] 213 EBIT bridge [PLN m] 18 53 18 18 478 899 452 865 212 213 Przychody ze sprzedaży Sales revenue EBITDA EBIT 1 9 8 7 6 5 4 3 2 1 452-62.7 46.1 351.6 +91.2% -174.6 212 EBIT EBIT 212 Electricity Wolumen sales Cena Electricity energii Price Cena of PM green Obligation Obowiązek related PM Obowiązek Obligation related PM Pozostałe Other EBIT. 213 213 EBIT sales sprzedaży volume energii price violet, zielonych, white to zielonych, red, violet, czerwonych to red and yellow i detalicznej property fioletowych, rights white fioletowych, property property żółtych rights białych białych property 283.7-31.7 865 Q4 213 financial data [PLN m] Q4 213 EBIT bridge [PLN m] 6 5 4 3 2 5 285 4 716 2 18 16 14 12 1 8 6 123-12.4-35.4 +17.1% 72.2-42.2 7.4-29.6 146 1 13 123 152 144 IV Q4 kw. 212 212 IV Q4 kw. 213 213 Przychody ze sprzedaży EBITDA EBIT Sales revenue 4 2 EBIT IV kw. Q4 212 EBIT 212 Electricity Wolumen sales Cena Electricity energii Price Cena of PM green Obligation Obowiązek related PM Obowiązek Obligation related PM Pozostałe Other sprzedaży energii zielonych, zielonych, czerwonych i sales volume price violet, white to green, violet, to red and yellow detalicznej fioletowych, fioletowych, żółtych property rights white property property rights białych białych EBIT IV kw. Q4 213 EBIT 213 3
Supply key elements 212 electricity supply [TWh] 213 electricity supply [TWh] 9.9 3.4 11.7 Grupa Group AA 4.7 1.1 Grupa Group A A Grupa Group B B 9.8 Grupa Group B B 44.4 Grupa Group C2+C1+R+D 41. Grupa Group C2+C1+R+D Grupa Group G G Grupa Group G G 7. 12.4 Potrzeby Own needs własne and oraz balancing różnice differences (including TD s bilansowe (w tym potrzeby own needs własne TD) 5.8 1.4 Potrzeby Own needs własne and oraz balancing różnice differences (including TD s bilansowe (w tym potrzeby own needs własne TD) Q4 212 electricity supply [TWh] Q4 213 electricity supply [TWh] 2.5 1. 2.9 Grupa Group AA 1.4 2.5 Grupa Group A A Grupa Group B B 2.5 Grupa Group B B 11.3 Grupa Group C2+C1+R+D 1.5 Grupa Group C2+C1+R+D Grupa Group G G Grupa Group GG 1.8 3.1 Potrzeby Own needs własne and oraz balancing różnice differences (including TD s bilansowe (w tym potrzeby own needs własne TD) 1.4 2.8 Potrzeby Own needs własne and oraz balancing różnice differences (including TD s bilansowe (w tym potrzeby own needs własne TD) Group A includes supply to the strategic customers of TAURON PE S.A. 31
Customer Service 5 4 3 2 339 213 financial data [PLN m] 213 EBIT bridge [PLN m] 493 mln zł 18 16 14 12 1 8 6 151 +125.% 1 25 12 212 213 Przychody Sales revenue ze sprzedaży EBITDA EBIT 45 27 4 2 12-133 212 EBIT EBIT 212 Przychody CUW Revenue of Shared Koszty świadczonych usług Costs of services Pozostałe przychody/koszty Other revenue/costs EBIT 213 213 EBIT Services Center provided -4 27 Q4 213 financial data [PLN m] EBIT Q4 bridge 213 IV EBIT kw. bridge 213 [mln [PLN zł] m] 15 7-25.6% 12 9 6 3 86 118 5 3 1 3-15 -33-1 -3-6 -12-15 -26-33 IV Q4 kw. 212 212 IV Q4 kw. 213 Przychody Sales revenue ze sprzedaży EBITDA EBIT -3-5 EBIT IV kw. Q4 212 EBIT 212-43 -4 Revenue Przychody of Shared CUW Koszty Costs świadczonych of services usług Pozostałe Other przychody/koszty revenue/costs Q4 EBIT 213 IV EBIT kw. Services Center provided 213 32
Electricity market price trends Electricity Platforms: TGE, TFS, GFI, GPW-POEE 213 214 (until 24-2-214) 214/213 Price PLN/MWh Volume GWh Price PLN/MWh Volume GWh Price % Volume % Forward BASE (Y+Q+M) 184,92 14 488 159,66 16 353-13.7% +14.1% Forward PEAK (Y+Q+M) 24,35 14 855 181,5 17 35-11.4% +14.7% Forward (weighted average) 186,78 155 343 161,71 177 389-13.4% +14.2% SPOT (TGE) 153,91 19 93 155, (Forecast) 2 (Forecast) +.7% +.4% Weighted average total 183.4 175 273 161.3 197 389-12.% +12.6% CO 2 emission allowances (EUA/t) CO 2 market analysts survey* Price (EUR/t) Certificate type Property rights (PLN/MWh) Market prices (214 average) (until 24-2-214) Substitution fee and obligation for 214 213 average 4.48 EUR/t RES (green) 23.24 3.3 (13.%) 214 average 6. 8. EUR/t Hard coal-fired cogeneration (red) No transactions Not announced (draft: 23.2%) 215 average 8. 1. EUR/t Gas-fired cogeneration (yellow) No transactions Not announced (draft: 3.9%) Average 214 EUA price forecast by TAURON 6.5 8. EUR/t Methane (violet) 59.64 63.26 (1.1%) * Sources: Point Carbon, Societe Generale, TAURON 33
214 BASE contracts 23 22 PLN/MWh BASE Y-14 Wolumen Volume obrotu Notowania Price Średnia Average GWh 5 4 5 4 21 3 5 2 3 19 2 5 18 2 17 16 16.4 1 5 1 15 5 14 211-7-1 211-1-1 212-1-19 212-4-29 212-8-8 212-11-17 213-2-26 213-6-7 213-9-16 213-12-26 Average price [PLN/MWh] Volume [GWh] Total 16.4 142 841 including TGE 156.46 1 74 non TGE 169.83 42 11 Average electricity price that takes into account 214 one year BASE and PEAK contracts: PLN 162.4/MWh, total 214 BASE and PEAK volume: 158 565 GWh 34
215 BASE contracts PLN/MWh BASE Y-15 GWh 5 2 19 18 Wolumen Volume obrotu Notowania Price Średnia Average 4 5 4 3 5 3 17 16 161.95 2 5 2 1 5 15 1 5 14 212-1-4 212-12-16 213-2-27 213-5-11 213-7-23 213-1-4 213-12-16 214-2-27 Average price [PLN/MWh] Volume [GWh] Total 161,95 36 573 including TGE 161,78 24 388 non TGE 162,3 12 185 Average electricity price that takes into account 215 one year BASE and PEAK contracts: PLN 163.46/MWh, total 215 BASE and PEAK volume: 38 291 GWh 35
216 BASE contracts 185 PLN/MWh BASE Y-16 GWh 5 18 175 Wolumen Volume obrotu Price Notowania Średnia Average 4 5 4 3 5 17 165 16 155 169,1 3 2 5 2 1 5 1 5 15 213-5-15 213-6-25 213-8-5 213-9-15 213-1-26 213-12-6 214-1-16 214-2-26 including Average price [PLN/MWh] Volume [GWh] Total 169,1 4 28 TGE 169,25 2 17 non TGE 168,75 2 38 Average electricity price that takes into account 216 one year BASE and PEAK contracts: PLN 169.34/MWh, total 216 BASE and PEAK volume: 4 246 GWh 36
TAURON Polska Energia share price in 213 37 1 2 3 4 5 6 5 1 15 2 25 3 35 4 45 212-12-28 213-1-4 213-1-9 213-1-14 213-1-17 213-1-22 213-1-25 213-1-3 213-2-4 213-2-7 213-2-12 213-2-15 213-2-2 213-2-25 213-2-28 213-3-5 213-3-8 213-3-13 213-3-18 213-3-21 213-3-26 213-4-2 213-4-5 213-4-1 213-4-15 213-4-19 213-4-24 213-4-29 213-5-6 213-5-9 213-5-14 213-5-17 213-5-22 213-5-27 213-5-31 213-6-5 213-6-1 213-6-13 213-6-18 213-6-21 213-6-26 213-7-1 213-7-4 213-7-9 213-7-12 213-7-17 213-7-22 213-7-25 213-7-3 213-8-2 213-8-7 213-8-12 213-8-16 213-8-21 213-8-26 213-8-29 213-9-3 213-9-6 213-9-11 213-9-16 213-9-19 213-9-24 213-9-27 213-1-2 213-1-7 213-1-1 213-1-15 213-1-18 213-1-23 213-1-28 213-1-31 213-11-6 213-11-12 213-11-15 213-11-2 213-11-25 213-11-28 213-12-3 213-12-6 213-12-11 213-12-16 213-12-19 213-12-27 WIG2 WIG Energia Tauron 1 2 3 4 5 6 1 2 3 4 5 6 7 8 9 212-12-28 213-1-4 213-1-9 213-1-14 213-1-17 213-1-22 213-1-25 213-1-3 213-2-4 213-2-7 213-2-12 213-2-15 213-2-2 213-2-25 213-2-28 213-3-5 213-3-8 213-3-13 213-3-18 213-3-21 213-3-26 213-4-2 213-4-5 213-4-1 213-4-15 213-4-19 213-4-24 213-4-29 213-5-6 213-5-9 213-5-14 213-5-17 213-5-22 213-5-27 213-5-31 213-6-5 213-6-1 213-6-13 213-6-18 213-6-21 213-6-26 213-7-1 213-7-4 213-7-9 213-7-12 213-7-17 213-7-22 213-7-25 213-7-3 213-8-2 213-8-7 213-8-12 213-8-16 213-8-21 213-8-26 213-8-29 213-9-3 213-9-6 213-9-11 213-9-16 213-9-19 213-9-24 213-9-27 213-1-2 213-1-7 213-1-1 213-1-15 213-1-18 213-1-23 213-1-28 213-1-31 213-11-6 213-11-12 213-11-15 213-11-2 213-11-25 213-11-28 213-12-3 213-12-6 213-12-11 213-12-16 213-12-19 213-12-27 Wartosc obrotu w tys. zl Tauron Volume in PLN thou.
TAURON's coverage by analysts Institution Analyst Institution Analyst DB Securities Tomasz Krukowski Ipopema Securities Piotr Zielonka, Tomasz Ściesiek Dom Inwestycyjny mbanku Kamil Kliszcz Raiffeisen Centrobank Teresa Schinwald Dom Maklerski Banku Handlowego Piotr Dzięciołowski Renaissance Capital Vladimir Sklyar Dom Maklerski BZ WBK Paweł Puchalski Societe Generale Leszek Iwaszko Dom Maklerski PKO BP Stanisław Ozga UBS Investment Research Michał Potyra J.P. Morgan Cazenove Michał Kuzawiński Patrick Hummel Erste Group Petr Bartek Tomasz Walkowicz Espirito Santo Investment Poland Maria Mickiewicz UniCredit CAIB Flawiusz Pawluk Goldman Sachs Fred Barasi WOOD & Company Bram Buring HSBC Dmytro Konovalov DM IDMSA Andrzej Bernatowicz ING Securities Milena Olszewska 38