Public Power Corporation (PPC) reported on Tuesday a 54% drop in its first quarter bottom-line due to an unseasonably warm and dry winter.
Net profits stood at EUR41 million versus EUR88.4 million in the respective quarter of 2006. Still, the results were above market’s expectations, as analysts surveyed by local media had seen profits falling by 61%.
«The profitability of the company which was affected by a single factor, namely very low snow and rain fall, would have exceeded last year's levels had hydro-generation remained at those of Q1 2006,» PPC Chairman Takis Athanasopoulos said in a statement.
A fall in energy generation from PPC's cheaper hydroelectric plants due to the shortage of rain added to the company's burden.
Sales rose 3.5 percent to EUR1.24 billion, a result of government-regulated tariff rises. Earnings before interest, tax, depreciation and amortization (EBITDA) dropped 20.1% to EUR235.6 million.
Last August, the government allowed PPC to raise rates by an average 4.8% to deal with high oil prices.
Operating expenses rose by about 11.2% to EUR1 billion in the first quarter, mainly due to increased expenditure for natural gas and energy purchases as hydro-generation fell 71%, due to low rainfall.
Separately, PPC said on Monday it had appealed against a decision by Bulgaria to cancel the sale of a power plant.
Bulgaria's Privatization Agency earlier this month cancelled the EUR105.2 million sale of its Bobov Dol power plant to PPC on what it said was environment concerns and disagreements on the purchase of coal.
PPC also said that its chairman had met Bulgaria's environment minister to discuss the possibility of reopening the tender.