| One off and temporary items affecting EBITDA (PLN million) |
2022 | 2021 |
|---|---|---|
| Change of reclamation provision | 1 721 | 1 463 |
| Provision for prosumers | 74 | -74 |
| LTC compensations | 2 | -58 |
| Liability due to one-time benefit – carve-out of NABE | -187 | 0 |
| Change of actuarial provision | -73 | 64 |
| Voluntary Leave Programme | 0 | 11 |
| Temporary item – rolling over of transaction hedging the price of CO2 allowances | 0 | 0 |
| Total | 1 537 | 1 406 |
Financial results
2022 was a next year of economic recovery after the Covid-19 pandemic. GDP expanded by 5.7% and industrial production grew by 10.9%.
The situation on energy markets in 2022 was dominated by the energy crisis caused by the outbreak of the war in Ukraine.
As a result of the disruption of the energy supply chain, energy commodity and energy prices have dramatically increased to historically high levels.
Total production in PGE Group entities decreased by 4% y/y in 2022, which resulted from lower demand of the National Energy System as a result of decreased energy consumption and lower energy exports.
PGE Group’s revenues increased by 39% y/y due to significant rises in energy prices, which is the main product of the Group.
Reported EBITDA amounted to PLN 8.7 billion and decline by 9% y/y due to rapid increases in CO2 costs and cost of production fuels such as hard coal.
Higher operating costs were also influenced by high inflation, which resulted in an increase in other operating costs.
In light of Russia's aggression against Ukraine and its possible repercussions, the good results generated by PGE Group last year only gain in importance. They increase the stability of the organisation, which has to face new challenges in parallel with the energy transition processes. It is with particular satisfaction that we present the record financial results of the Renewables segment. They testify to the growing role played by renewable energy sources at PGE Group.
Consolidated statement of profit and loss
Net profit generated in 2022 amounted to PLN 3.4 billion. Net profit was significantly impacted by non-recurring events in the form of the release of a reclamation provision.
The one-off events were of a non-cash nature and did not affect cash flow from operating activities, which amounted to PLN 11.6 billion.
73 435
mln
PLN
Revenues
5 741
mln
PLN
Gross profit on sales
4 299
mln
PLN
EBIT
4 110
mln
PLN
Gross profit
| PLN [m] | 2022 | 2021 |
|---|---|---|
| STATEMENT OF PROFIT OR LOSS | ||
| REVENUE FROM SALES | 73 435 | 52 772 |
| Cost of sales | (67 694) | (49 163) |
| GROSS PROFIT ON SALES | 5 741 | 3 609 |
| Distribution and selling expenses | (2 012) | (1 515) |
| General and administrative expenses | (1 382) | (1 028) |
| Net other operating income/(costs) | 1 952 | 4 057 |
| OPERATING PROFIT | 4 299 | 5 123 |
| Net financial income / (costs), including: | -189 | -250 |
| Interest income calculated using the effective interest rate method | 458 | 35 |
| Share of profit/(loss) of entities accounted for using the equity method | – | -2 |
| GROSS PROFIT | 4 110 | 4 871 |
| Income tax | -720 | -926 |
| NET PROFIT | 3 390 | 3 945 |
| OTHER COMPREHENSIVE INCOME | ||
| Items that may be reclassified to profit or loss in the future: | -640 | 623 |
| Valuation of debt financial instruments | -3 | 12 |
| Valuation of hedging instruments | -788 | 757 |
| Foreign exchange differences from translation of foreign entities | 1 | – |
| Deferred tax | 150 | -146 |
| Items that may not be reclassified to profit or loss in the future: | 147 | 336 |
| Actuarial gains and losses from valuation of provisions for employee benefits | 179 | 404 |
| Deferred tax | -33 | -77 |
| Share of profit of equity-accounted entities | 1 | 9 |
| NET OTHER INCOME | -493 | 959 |
| TOTAL COMPREHENSIVE INCOME | 2 897 | 4 904 |
| NET PROFIT/(LOSS) ATTRIBUTABLE TO: | ||
| shareholders of the parent | 3 328 | 3 972 |
| non-controlling interests | 62 | -27 |
| COMPREHENSIVE INCOME ATTRIBUTABLE TO: | ||
| shareholders of the parent | 2 836 | 4 929 |
| non-controlling interests | 61 | -25 |
| NET PROFIT PER SHARE ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT COMPANY (IN PLN) | 1.56 | 2.12 |
| DILUTED NET PROFIT PER SHARE ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT COMPANY (IN PLN) | 1.56 | 2.12 |
Balance of non-recurring events (EBITDA level)
Non-recurring events in 2022 had a positive impact on the reported result (similarly to last year). The balance of events amounted to PLN 1 537 million and consisted mainly of the release of a reclamation provision totalling PLN 1 721 million.
Reported EBITDA by segment
In 2022, there was a decline in reported EBITDA. In the Conventional Generation and District Heating segment, the results were negatively affected by a sudden increase in the prices of CO2 emission allowances and production fuels.
In the Distribution segment, the results were supported by higher revenues from the distribution tariff and connection fees. In the Trade segment, there was an increase in the result on the sale of energy to end users and revenues from activities within the PGE Group.
In the Renewables segment, EBITDA increased due to significantly higher energy prices on the spot market.
| Key segment data | 2022 | 2021 | y/y |
| EBITDA [PLN m], including: | 8 657 | 9 535 | -9% |
| Conventional Generation | 2 065 | 4 078 | -49% |
| District Heating | 39 | 805 | -95% |
| Renewables | 1795 | 1016 | 77% |
| Distribution | 2 850 | 2 779 | 3% |
| Supply | 2043 | 827 | 147% |
| Circular Economy | 37 | 45 | -18% |
Reported EBIT by segment
| Key segment data | 2022 | 2021 | y/y |
| EBITDA [PLN m], including: | 4 299 | 5 123 | -16% |
| Conventional Generation | 127 | 1 998 | – |
| District Heating | -713 | 104 | -786% |
| Renewables | 1440 | 686 | 110% |
| Distribution | 1 616 | 1 559 | 4% |
| Supply | 2010 | 794 | 153% |
| Circular Economy | 28 | 36 | -22% |
One-off items and recurring EBIT
| [mln PLN] | 2022 | 2021 | r/r |
| One-off items – EBITDA level | 1537 | 1406 | 9% |
| Impairments of TFA and IA | -104 | -216 | – |
| One-off items – EBIT level | 1433 | 1190 | 20% |
| EBIT recurring | 2 866 | 3 933 | -27% |
Consolidated balance sheet (key categories)
The increase in the balance sheet total is mainly the result of an increase in the cash balance, also resulting from the issue of shares carried out in 2022, which brought approximately PLN 3.2 billion. Additionally, as a result of investments made, the value of fixed assets also increased.
Debt level
At the end of 2022, the PGE Group had net cash of approximately PLN 2.7 billion compared to net debt of PLN 4.2 billion at the end of 2021.
However, the estimated level of net economic financial debt (taking into account future payments for CO2 emission allowances) amounted to PLN 14.4 billion. The company’s operations were mainly financed by earned funds from operations of PLN 11.6 billion.
| [PLN m] | As at December 31,2022 | As at December 31,2021 | |
| Property, plant and equipment | 64 388 | 61 125 | |
| Investment property | 32 | 39 | |
| Intangible assets | 726 | 682 | |
| Right-of-use assets | 1 311 | 1 257 | |
| Financial receivables | 223 | 204 | |
| Derivatives and other assets measured at fair value through profit or loss | 608 | 364 | |
| Shares and other equity instruments | 117 | 117 | |
| Shares accounted for using the equity method | 180 | 156 | |
| Other non-current assets | 850 | 873 | |
| CO2 emission allowances for captive use | 114 | 797 | |
| Deferred income tax assets | 3 183 | 933 | |
| NON-CURRENT ASSETS | 71 732 | 66 547 | |
| Inventories | 4 918 | 2 189 | |
| CO2 emission allowances for captive use | 4 754 | 4 106 | |
| Income tax receivables | 239 | 144 | |
| Derivatives and other assets measured at fair value through profit or loss | 927 | 575 | |
| Trade and other financial receivables | 9 083 | 7 727 | |
| Other current assets | 2 219 | 1 240 | |
| Cash and cash equivalents | 11 887 | 6 733 | |
| CURRENT ASSETS | 34 027 | 22 714 | |
| ASSETS CLASSIFIED AS HELD FOR SALE | 19 | 13 | |
| TOTAL ASSETS | 105 778 | 89 274 | |
| Share capital | 20.1 | 19 184 | 19 165 |
| Reserve capital | 20.2 | 25 049 | 20 154 |
| Hedging reserve | 20.3 | -32 | 609 |
| Foreign exchange differences from translation | 20.4 | 4 | 2 |
| Retained earnings | 20.5 | 9 333 | 7 564 |
| EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT | 53 538 | 47 494 | |
| Equity attributable to non-controlling interests | 20.6 | 845 | 797 |
| TOTAL EQUITY | 54 383 | 48 291 | |
| Non-current provisions | 21 | 6 363 | 8 559 |
| Loans, borrowings, bonds and lease | 25.1.3 | 6 799 | 8 666 |
| Derivatives | 25.1.2 | 305 | 1 |
| Deferred income tax liabilities | 14.2 | 1 002 | 402 |
| Deferred income and government grants | 23.1 | 1 011 | 881 |
| Other financial liabilities | 25.1.4 | 478 | 517 |
| Other non-financial liabilities | 24.1 | 141 | 133 |
| NON-CURRENT LIABILITIES | 16 099 | 19 159 | |
| Current provisions | 21 | 21 223 | 12 600 |
| Loans, borrowings, bonds and leases | 25.1.3 | 2 137 | 2 160 |
| Derivatives | 25.1.2 | 1 629 | 82 |
| Trade and other financial liabilities | 25.1.4 | 6 707 | 4 601 |
| Income tax liabilities | 198 | 20 | |
| Deferred income and government grants | 23.2 | 97 | 103 |
| Other non-financial liabilities | 24.2 | 3 305 | 2 258 |
| CURRENT LIABILITIES | 35 296 | 21 824 | |
| TOTAL LIABILITIES | 51 395 | 40 983 | |
| TOTAL EQUITY AND LIABILITIES | 105 778 | 89 274 |