CEZ Electro Q3’19 EPS grows 11.9%; cash per share reaches BGN 28k (POSITIVE)

Q3 revenue of CEZ Electro surged 30.8% YoY to BGN 133.3m. The gross mark-up after cost of balancing came to 10.2% from 13.4% in the comparable period, still way above the regulatory set mark-up of 6.51% before cost of balancing. EBITDA improved by 17.6% to BGN 6m, due to the growth of gross profit and the decline of compensation cost while hired services cost surged 18.8% YoY. The increase of depreciation cost could not offset the positive developments above EBITDA line and the company ended the quarter with BGN 5.1m net profit, +11.9% YoY (EPS of BGN 1 010.00). 9m’19 revenue was up 11.7% while gross mark-up widened to 8.2% vs 7.3% in the comparable period. EBITDA surged 29.9% to BGN 13.5m and their growth was partly restrained by the lower other income. Recall that in the comparable period the company booked BGN 3.9m income from penalty on a contract with the insolvent Future Energy. Net profit grew 23.2% YoY to BGN 11.2m (EPS of BGN 2 246.80). On the balance sheet PPE increased by BGN 4.2m on the introduction of IFRS 16 from the beginning of 2019 and the same amount was recognised as lease liabilities. Non-cash working capital decreased by BGN 7.8m in 9m’19 on the decline of both receivables and payables while cash level added BGN 17.8m to the record high BGN 140m (cash per share of BGN 27 999.40).