AS Tallinna Vesi’s financial results for the first quarter of 2023
Tallinna Vesi
8 min read
Tallinna Vesi
In the first quarter of 2023, AS Tallinna Vesi earned €14.6 million in revenue and €3.50 million in net profit. The level of investments in fixed assets in the first quarter increased by 68% compared to the previous period, reaching €4.7 million.
In 2023, the sales from water services increased by 18.6% in the first quarter compared to the same period last year.
Sales from water services provided to commercial customers in the main service area increased by approximately 11% in the first quarter, reaching €4.27 million. “Sales in the first quarter increased due to sales price reflecting increased direct production cost and the increase in water consumption by the hospitality and leisure establishments in the capital area. The increase in sales was also influenced by the significant increase in construction volumes," said Aleksandr Timofejev, CEO of Tallinna Vesi. Sales from water services provided to private customers increased by 23.2% in the first quarter compared to a year ago, reaching €6.04 million.
The Company's gross profit for the first quarter was €5.71 million, increasing by €1.33 million compared to the same period last year. "The recovery in gross profit is related to the sales price reflecting the increase in production cost. Gross profit increased by 30.4% compared to the same period last year," Timofejev explained.
The Company’s operating profit in the first quarter amounted to €4.1 million, which is €1.07 million more compared to the same period last year.
The Company’s net profit was €3.5 million in the first quarter of 2023, which is €0.62 more than in the same period in 2022.
Compared to the first quarter of 2022, the sales from construction services provided by the subsidiary Watercom increased by 119.7%, or €0.44 million. The increase in sales is mainly related to the increase in construction volumes in 2023 and the projects carried over from 2022 to 2023.
Tallinna Vesi has increased investments in fixed assets to ensure the sustainability of its infrastructure and the service continuity. In the first three months of this year, AS Tallinna Vesi has invested as much as €4.7 million in fixed assets, which is 68% more compared to the same period last year.
The investment plan for the following years is prepared based on the Public Water Supply and Sewerage Development Plan for the next 12 years, ordered by the City of Tallinn and prepared by AS Infragate, which can be found as a document on the website of the City of Tallinn. “Current and future investments will continue to ensure the high-quality drinking water for the residents of Tallinn and help to keep the natural environment cleaner, increasing both the average life span of pipelines and the efficiency of treatment systems by means of modern technologies and materials. That way, we can ensure the continuity of a vital service at an affordable price and with the least possible disruption to residents’ daily life," said Timofejev.
AS Tallinna Vesi will gradually switch to remote readable water meters, which will free customers from the obligation of reporting their water meter readings every month. The first three thousand customers have already received their new smart meters and this year, the installation will continue at an accelerated pace. The plan is to cover the entire service area of AS Tallinna Vesi with remote water meters by 2026.
As an important project, the installation of a new pump was completed in the main wastewater pumping station at the Wastewater Treatment Plant at Paljassaare. Projects currently in progress include the installation of a valve between the suction basins at the main wastewater pumping station, reconstruction of digesters, installation of a cogeneration plant and reconstruction of aeration tanks, additional screens for the main wastewater pumping station, reconstruction of screens at the wastewater treatment plant and reconstruction of secondary clarifiers.
Additionally, AS Tallinna Vesi has started studies to identify the potential for heat recovery from the air of air blowers and is participating in a research project funded by Interreg on the application of various technologies to remove PFASs from wastewater. The Company is also involved in another Interreg project, aiming to test new technologies for removing APIs from wastewater.
Main financialindicators
€ million, except key ratios
1st quarter
Change 2023/ 2022
2023
2022
2021
Sales
14.60
12.05
11.78
21.1%
Gross profit
5.71
4.38
5.18
30.4%
Gross profit margin %
39.13
36.36
43.97
7.6%
Operating profit before depreciation and amortisation
6.02
4.64
6.23
29.6%
Operating profit before depreciation and amortisation margin %
41.22
38.53
52.83
7.0%
Operating profit
4.07
3.00
4.66
35.6%
Operating profit - main business
3.91
2.92
4.50
34.2%
Operating profit margin %
27.89
24.92
39.55
11.9%
Profit before taxes
3.53
2.91
4.57
21.3%
Profit before taxes margin %
24.16
24.13
38.78
0.1%
Net profit
3.50
2.88
4.55
21.6%
Net profit margin %
23.97
23.88
38.59
0.4%
ROA %
1.38
1.12
2.09
23.0%
Debt to total capital employed %
55.19
54.17
54.83
1.9%
ROE %
3.11
2.46
4.70
26.2%
Current ratio
1.46
3.20
4.48
-54.4%
Quick ratio
1.38
3.13
4.42
-55.9%
Investments into fixed assets
4.67
2.78
2.28
68.0%
Payout ratio %
na
na
na
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 receivables
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
€ thousand
as of 31 March
as of 31 December
ASSETS
Note
2023
2022
2022
CURRENT ASSETS
Cash and cash equivalents
3
12,889
37,570
12,650
Trade receivables, accrued income and prepaid expenses
7,679
6,228
8,989
Inventories
1,319
922
1,197
TOTAL CURRENT ASSETS
21,887
44,720
22,836
NON-CURRENT ASSETS
Property, plant, and equipment
4
232,513
212,732
229,869
Intangible assets
5
765
690
688
TOTAL NON-CURRENT ASSETS
233,278
213,422
230,557
TOTAL ASSETS
255,165
258,142
253,393
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Leases
963
464
883
Loans
3,630
3,630
3,630
Trade and other payables
7,752
6,587
10,225
Prepayments
2,596
3,302
3,749
TOTAL CURRENT LIABILITIES
14,941
13,983
18,487
NON-CURRENT LIABILITIES
Deferred income from connection fees
40,950
37,727
39,150
Leases
1,60
1,297
1,607
Loans
76,716
80,348
76,708
Provision for possible third-party claims
6
6,018
6,018
6,018
Deferred tax liability
523
402
496
Other payables
89
68
101
TOTAL NON-CURRENT LIABILITIES
125,899
125,860
124,080
TOTAL LIABILITIES
140,840
139,843
142,567
EQUITY
Share capital
12,000
12,000
12,000
Share premium
24,734
24,734
24,734
Statutory legal reserve
1,278
1,278
1,278
Retained earnings
76,313
80,287
72,814
TOTAL EQUITY
114,325
118,299
110,826
TOTAL LIABILITIES AND EQUITY
255,165
258,142
253,393
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
€ thousand
Quarter 1
for the year ended 31 December
Note
2023
2022
2022
Revenue
7
14,599
12,053
54,558
Cost of goods and services sold
9
-8,887
-7,670
-37,660
GROSS PROFIT
5,712
4,383
16,898
Marketing expenses
9
-215
-199
-703
General administration expenses
9
-1,303
-1,131
-4,399
Other income (+)/ expenses (-)
10
-122
-48
-476
OPERATING PROFIT
4,072
3,005
11,320
Financial income
11
10
1
8
Financial expenses
11
-555
-97
-682
PROFIT BEFORE TAXES
3,527
2,909
10,646
Income tax
12
-28
-30
-2,240
NET PROFIT FOR THE PERIOD
3,499
2,879
8,406
COMPREHENSIVE INCOME FOR THE PERIOD
3,499
2,879
8,406
Attributable profit to:
Equity holders of A-shares
3,499
2,879
8,406
Earnings per A-share (in euros)
13
0,17
0,14
0,42
CONSOLIDATED STATEMENT OF CASH FLOWS
€ thousand
3 months
for the year ended 31 December
Note
2023
2022
2022
CASH FLOWS FROM OPERATING ACTIVITIES
Operating profit
4,072
3,005
11,320
Adjustment for depreciation/amortisation
4,5,9,10
1,945
1,639
6,817
Adjustment for revenues from connection fees
10
-145
-134
-544
Profit (-)/loss (+) from sale of property, plant and equipment, and intangible assets
0
-3
-32
Change in current assets involved in operating activities
1,191
202
-2,841
Change in liabilities involved in operating activities
-1,357
-811
309
TOTAL CASH FLOWS FROM OPERATING ACTIVITIES
5,706
3,898
15,029
CASH FLOWS USED IN INVESTING ACTIVITIES
Acquisition of property, plant, and equipment, and intangible assets
-5,304
-3,327
-20,701
Compensations received for construction of pipelines, incl connection fees
288
665
1,593
Proceeds from sale of property, plant and equipment, and intangible assets
0
3
53
Interest received
10
1
9
TOTAL CASH FLOWS USED IN INVESTING ACTIVITIES
-5,006
-2,658
-19,046
CASH FLOWS USED IN FINANCING ACTIVITIES
Interest paid and loan financing costs, incl swap interests
-258
-117
-616
Lease payments
-203
-112
-524
Repayment of loans
0
0
-3,636
Dividends paid
12
0
0
-12,835
Withheld income tax paid on dividends
12
0
0
-165
Income tax paid on dividends
12
0
0
-2,116
TOTAL CASH FLOWS USED IN FINANCING ACTIVITIES
-461
-229
-19,892
CHANGE IN CASH AND CASH EQUIVALENTS
239
1,011
-23,909
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD
3
12,650
36,559
36,559
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD
3
12,889
37,570
12,650
More information: Maria Tiidus Head of Communications Tallinna Vesi Ph: 626 2271 E-mail: maria.tiidus@tvesi.ee
