Published: 2021-01-29 08:00:00 CET
Tallinna Vesi
Quarterly report

AS Tallinna Vesi´s financial results for the 4th quarter of 2020

AS Tallinna Vesi’s sales revenue for the fourth quarter of 2020 were €13.17 million, showing a decrease of 18.3% compared to the same period last year. This was a result of reduced tariffs and lower commercial consumption, linked to the coronavirus outbreak.

Sales to private customers in the main service area decreased by 15.2% to €5.13 million, mainly resulting from the reductions in tariffs, that became effective already at the end of 2019. The impact of reduced tariffs was partly balanced by higher consumption of apartment blocks, which is the largest private customer segment of the Company. Again, this was linked to the coronavirus, and more people working from home, therefore increasing consumption.

In the main service area, the sales revenue from commercial customers dropped by 25.7% to €3.81 million, which was a consequence of lower tariffs, as well as 16.9% lower consumption by businesses. The hospitality sector has seen the greatest impact from the pandemic.

The gross profit for the 4th quarter of 2020 was €5.64 million, showing a reduction of 29.4%, which is attributable to the lower sales revenue. The operating profit was €5.76 million, which is a reduction of €5.31 compared to the previous year. The main factors impacting the operating profit were reduced tariffs and lower sales revenues connected to a decline in consumption.

The net profit for the 4th quarter of 2020 was €5.39 million, showing a decrease of €5.56 million compared to the same period of 2019. The decline in the net profit, was predominantly a consequence of lower operating profits. Deferred tax also contributed to the decrease in net profit, whilst lower interest costs had a positive impact on profitability.

Coronavirus also had an impact on the construction sector in Tallinn, with many projects being postponed, causing a downturn in water and wastewater connections activity. In the 4th quarter, our subsidiary Watercom continued to work on the major projects secured in 2019, both in Tallinn and across Estonia. The sales revenue from constructions services for the 4th quarter was €1.31 million, indicating a 31.1% decline compared to the same period of 2019. The decrease in revenue was largely due to the lower revenue from pipe construction services, which were partly balanced by higher revenues from road construction services.

On 28 January 2021, AS Tallinna Vesi acquired a full shareholding in the company with the business name ASTV Green Energy OÜ in the Republic of Estonia. The main business activity of the company is initially gas production. The company is a start-up and no active economic activity has been conducted.

MAIN FINANCIAL INDICATORS

€ million,
except key ratios
4th quarterChange 2020/ 201912 monthsChange 2020/ 2019
202020192018202020192018
Sales13.1716.1216.23-18.3%51.7263.4262.78-18.5%
Gross profit5.647.988.38-29.4%22.2333.9534.19-34.5%
Gross profit margin %42.7849.4951.61-13.6%42.9753.5354.45-19.7%
Operating profit before depreciation and amortisation7.4112.726.82-41.7%28.0738.1832.73-26.5%
Operating profit before depreciation and amortisation margin %56.2378.8642.01-28.7%54.2760.2152.13-9.9%
Operating profit5.7611.065.29-48.0%21.7832.0826.94-32.1%
Operating profit - main business5.5110.825.07-49.1%20.8831.1926.22-33.0%
Operating profit margin %43.7168.6132.61-36.3%42.1250.5742.91-16.7%
Profit before taxes5.6410.955.01-48.5%21.3431.3025.95-31.8%
Profit before taxes margin %42.8567.9330.88-36.9%41.2749.3641.33-16.4%
Net profit5.3910.955.01-50.8%16.7327.7624.15-39.7%
Net profit margin %40.9167.9330.88-39.8%32.3543.7738.47-26.1%
ROA %2.124.212.03-49.7%6.4510.8310.10-40.4%
Debt to total capital employed % 56.09 56.05 58.850.1% 56.09 56.05 58.850.1%
ROE %4.929.955.00-50.6%14.6925.4325.61-42.2%
Current ratio3.855.485.36-2.2%3.855.485.36-29.7%
Quick ratio3.805.445.33-2.0%3.805.445.33-30.1%
Investments into fixed assets5.655.333.046.0%19.42 16.0910.4020.7%
Payout ratio %na72.0562.11 na72.0562.11 

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 services related activities, excl. connections profit and government grants, construction services, doubtful debt

STATEMENT OF COMPREHENSIVE INCOME4th quarter4th quarter 12 months12 months 12 months
€ thousand20202019 20202019 2019
        
Revenue13,17216,122 51,71763,423 63,423
Cost of goods and services sold-7,537-8,143 -29,491-29,470 -29,470
GROSS PROFIT5,6357,979 22,22633,953 33,953
        
Marketing expenses-113-93 -433-390 -390
General administration expenses-945-1,281 -4,576-5,689 -5,689
Other income (+)/ expenses (-)1,1804,457 4,5674,201 4,201
OPERATING PROFIT5,75711,062 21,78432,075 32,075
        
Financial income38 3138 38
Financial expenses-116-118 -473-809 -809
Other financial income (+)/ expenses (-)00 00 0
PROFIT BEFORE TAXES5,64410,952 21,34231,304 31,304
        
Income tax on dividends-2550 -4,610-3,544 -3,544
        
NET PROFIT FOR THE PERIOD5,38910,952 16,73227,760 27,760
COMPREHENSIVE INCOME FOR THE PERIOD5,38910,952 16,73227,760 27,760
        
Attributable profit to:       
Equity holders of A-shares5,38810,951 16,73127,759 27,759
B-share holder0.600.60 0.600.60 0.60
        
Earnings per A share (in euros)0.270.55 0.841.39 1.39
Earnings per B share (in euros)600600 600600 600


STATEMENT OF FINANCIAL POSITION    
€ thousand31/12/202031/12/2019 31/12/2019
     
ASSETS    
CURRENT ASSETS    
Cash and cash equivalents44,51464,775 64,775
Trade receivables, accrued income and prepaid expenses7,0197,239 7,239
Inventories701504 504
TOTAL CURRENT ASSETS52,23472,518 72,518
     
NON-CURRENT ASSETS    
Property, plant and equipment202,802189,627 189,627
Intangible assets629710 710
TOTAL NON-CURRENT ASSETS203,431190,337 190,337
     
TOTAL ASSETS255,665262,855 262,855
     
LIABILITIES AND EQUITY    
     
CURRENT LIABILITIES    
Current portion of long-term lease liabilities393352 352
Current portion of long-term loans3,6303,631 3,631
Trade and other payables7,0846,717 6,718
Derivatives0221 221
Prepayments2,4452,323 2,323
TOTAL CURRENT LIABILITIES13,55213,244 13,245
     
NON-CURRENT LIABILITIES    
Deferred income from connection fees34,56431,070 31,070
Leases1,400964 964
Loans83,97887,592 87,592
Provision for possible third party claims9,62814,442 0
Deferred tax liability2550 14,442
Other payables3218 18
TOTAL NON-CURRENT LIABILITIES129,857134,086 134,086
TOTAL LIABILITIES143,409147,330 147,331
     
EQUITY    
Share capital12,00012,000 12,000
Share premium24,73424,734 24,734
Statutory legal reserve1,2791,279 1,278
Retained earnings74,24377,512 77,512
TOTAL EQUITY112,256115,525 115,524
     
TOTAL LIABILITIES AND EQUITY255,665262,855 262,855
     
     
CASH FLOWS STATEMENT12 months12 months 12 months
€ thousand20202019 2019
     
CASH FLOWS FROM OPERATING ACTIVITIES    
Operating profit21,78432,075 32,075
Adjustment for depreciation/amortisation6,2836,109 6,109
Adjustment for revenues from connection fees-542-389 -389
Other non-cash adjustments-4,814-4,624 -4,624
Profit/loss(+) from sale and write off of property, plant and equipment, and intangible assets-14138 138
Change in current assets involved in operating activities140391 391
Change in liabilities involved in operating activities-215318 318
TOTAL CASH FLOWS FROM OPERATING ACTIVITIES22,62234,018 34,018
     
CASH FLOWS USED IN INVESTING ACTIVITIES    
Acquisition of property, plant and equipment, and intangible assets-15,682-10,441 -10,441
Compensations received for construction of pipelines, incl connection fees1,9983,010 3,010
Proceeds from sales of property, plant and equipment and intangible assets3224 24
Interest received3536 36
TOTAL CASH FLOWS USED IN INVESTING ACTIVITIES-13,617-7,371 -7,371
     
CASH FLOWS USE D IN FINANCING ACTIVITIES    
Interest paid and loan financing costs, incl swap interests-719-1,056 -1,056
Lease payments-555-404 -404
Received loans037,500 37,500
Repayment of loans-3,636-41,136 -41,136
Dividends paid-19,888-14,965 -14,965
Withheld income tax paid on dividends-113-36 -36
Income tax paid on dividends-4,355-3,544 -3,544
TOTAL CASH FLOW USED IN FINANCING ACTIVITIES-29,266-23,641 -23,641
     
CHANGE IN CASH AND CASH EQUIVALENTS-20,2613,006 3,006
     
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD64,77561,769 61,769
     
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD44,51464,775 64,775


Karl Heino Brookes

Chairman of the Management Board

+372 62 62 200  

karl.brookes@tvesi.ee

Attachment



Q4 2020 final report Eng.pdf