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AS Tallinna Vesi’s financial results for the first quarter of 2023
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 financial indicators
€ million, | 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 |
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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 |
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| as of 31 March | as of 31 December | |||
ASSETS |
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| Note | 2023 | 2022 | 2022 | ||
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CURRENT ASSETS |
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| Cash and cash equivalents |
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| 3 | 12,889 | 37,570 | 12,650 | ||
| Trade receivables, accrued income and prepaid expenses |
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| 7,679 | 6,228 | 8,989 | |||
| Inventories |
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| 1,319 | 922 | 1,197 | |
TOTAL CURRENT ASSETS |
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| 21,887 | 44,720 | 22,836 | |||
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NON-CURRENT ASSETS |
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| Property, plant, and equipment |
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| 4 | 232,513 | 212,732 | 229,869 | ||
| Intangible assets |
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| 5 | 765 | 690 | 688 | |
TOTAL NON-CURRENT ASSETS |
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| 233,278 | 213,422 | 230,557 | |||
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TOTAL ASSETS |
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| 255,165 | 258,142 | 253,393 | ||
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LIABILITIES AND EQUITY |
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CURRENT LIABILITIES |
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| Leases |
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| 963 | 464 | 883 | ||
| Loans |
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| 3,630 | 3,630 | 3,630 | ||
| Trade and other payables |
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| 7,752 | 6,587 | 10,225 | ||
| Prepayments |
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| 2,596 | 3,302 | 3,749 | |
TOTAL CURRENT LIABILITIES |
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| 14,941 | 13,983 | 18,487 | |||
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NON-CURRENT LIABILITIES |
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| Deferred income from connection fees |
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| 40,950 | 37,727 | 39,150 | ||
| Leases |
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| 1,60 | 1,297 | 1,607 | |
| Loans |
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| 76,716 | 80,348 | 76,708 | |
| Provision for possible third-party claims |
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| 6 | 6,018 | 6,018 | 6,018 | ||
| Deferred tax liability |
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| 523 | 402 | 496 | |
| Other payables |
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| 89 | 68 | 101 | |
TOTAL NON-CURRENT LIABILITIES |
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| 125,899 | 125,860 | 124,080 | |||
TOTAL LIABILITIES |
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| 140,840 | 139,843 | 142,567 | ||
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EQUITY |
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| Share capital |
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| 12,000 | 12,000 | 12,000 | |
| Share premium |
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| 24,734 | 24,734 | 24,734 | |
| Statutory legal reserve |
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| 1,278 | 1,278 | 1,278 | ||
| Retained earnings |
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| 76,313 | 80,287 | 72,814 | |
TOTAL EQUITY |
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| 114,325 | 118,299 | 110,826 | ||
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TOTAL LIABILITIES AND EQUITY |
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| 255,165 | 258,142 | 253,393 | |||
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
€ thousand |
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| Quarter 1 |
| for the year ended 31 December | ||||
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| Note | 2023 | 2022 |
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| 2022 |
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Revenue |
| 7 | 14,599 | 12,053 |
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| 54,558 | ||
Cost of goods and services sold |
| 9 | -8,887 | -7,670 |
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| -37,660 | ||
GROSS PROFIT |
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| 5,712 | 4,383 |
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| 16,898 | ||
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Marketing expenses |
| 9 | -215 | -199 |
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| -703 | ||
General administration expenses |
| 9 | -1,303 | -1,131 |
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| -4,399 | ||
Other income (+)/ expenses (-) |
| 10 | -122 | -48 |
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| -476 | ||
OPERATING PROFIT |
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| 4,072 | 3,005 |
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| 11,320 | ||
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Financial income |
| 11 | 10 | 1 |
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| 8 | ||
Financial expenses |
| 11 | -555 | -97 |
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| -682 | ||
PROFIT BEFORE TAXES |
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| 3,527 | 2,909 |
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| 10,646 | ||
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Income tax |
| 12 | -28 | -30 |
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| -2,240 | ||
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NET PROFIT FOR THE PERIOD |
| 3,499 | 2,879 |
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| 8,406 | |||
COMPREHENSIVE INCOME FOR THE PERIOD | 3,499 | 2,879 |
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| 8,406 | ||||
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Attributable profit to: |
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Equity holders of A-shares |
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| 3,499 | 2,879 |
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| 8,406 | ||
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Earnings per A-share (in euros) |
| 13 | 0,17 | 0,14 |
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| 0,42 | ||
CONSOLIDATED STATEMENT OF CASH FLOWS
€ thousand |
| 3 months | for the year ended 31 December | |||||||
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| Note | 2023 | 2022 | 2022 | ||||
CASH FLOWS FROM OPERATING ACTIVITIES |
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| Operating profit |
| 4,072 | 3,005 | 11,320 | |||||
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| Adjustment for depreciation/amortisation | 4,5,9,10 | 1,945 | 1,639 | 6,817 | ||||
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| Adjustment for revenues from connection fees | 10 | -145 | -134 | -544 | ||||
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| 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 | |||||||
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CASH FLOWS USED IN INVESTING ACTIVITIES |
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| Acquisition of property, plant, and equipment, and |
| -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 | |||||||
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CASH FLOWS USED IN FINANCING ACTIVITIES |
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| 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 | |||||||
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CHANGE IN CASH AND CASH EQUIVALENTS |
| 239 | 1,011 | -23,909 | ||||||
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CASH AND CASH EQUIVALENTS AT THE | 3 | 12,650 | 36,559 | 36,559 | ||||||
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CASH AND CASH EQUIVALENTS AT THE END | 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
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