PPC posts sharp rise in 9-month net profit; debt lower

Greece’s major power utility, the Public Power Corporation (PPC), yesterday announced a surge in nine-month net profits, boosted by tariff hikes and increased consumption. Earnings before interest, tax, depreciation and amortization (EBITDA) rose 17.1 percent to 901.6 million euros, with the EBITDA margin improving slightly to 30.7 percent from 30.6 percent in the same period last year. Revenues increased 16.5 percent to 2,935 million euros, boosted by a 6 percent increase in consumption, a 3.85 percent increase in tariffs in July 2002 and 193 million euros in revenue from power transfer line charges, included in nine-month results for the first time. The unaudited results were compiled according to International Accounting Standards. Net income amounted to 260.5 million euros, an increase of 76.3 percent. Earnings per share were also up 76.3 percent to 1.12 euros, against 0.64 euros in the same period last year. The corporation’s net debt burden declined by 271.9 million euros to 4,001.4 million. «PPC continues to show a strong operating and financial performance and significant net cash flows, as attested to by improved profitability and the continuing reduction in debt,» said Managing Director Stergios Nezis. Operating expenses in the nine months (excluding depreciation) were up 16.2 percent to 2.033 million euros. Payroll expenses rose 8 percent to 816 million due to additional salary increases despite a fall in the number of employees from 28,847 to 28,120. Fuel costs increased 5.4 percent to 586 million euros. PPC, which is 49 percent-floated on the Athens bourse, invested 490 million euros during the period, mainly in a new lignite power plant in Florina, other units in Crete, the development of mines and an expansion of the grid. PPC’s telecommunications subsidiary Tellas, launched in February and now estimated to have 6 percent of the domestic fixed-line market, showed a 26.8-million-euro loss during the period. PPC officials said recently the corporation is considering buying power distribution utilities in Bulgaria as part of its Balkan expansion plan. It also has an option to buy 30 percent in the Public Gas Corporation (DEPA) once negotiations over the latter’s privatization are concluded with Spain’s Gas Natural, which has put in a binding offer for a 35 percent stake.