The new investment plan is 28% higher than the previous budget assigned for 2015. Nevertheless, it is still 40% lower than the what the company promised investors before the initial public offering one year ago.
The Romanian government, Electrica’s majority stockholder, rejected the first RON773 million investment plan on being too low compared with the commitments in the floating offer. The bulk of the investments will go to electricity distribution.
Last year, Electrica said it aims to invest RON1.39 billion in 2015 and a total of RON6.2 billion between 2014-2018.
Romanian energy regulator ANRE further rejected the investment plan and set an investment plan at half from what the company had initially planned, probably because it would have caused an increase in distribution tariffs.
The new investment program will be 90% funded from own sources, while the rest will come from loans and EU funds.
A year ago, Electrica gathered almost RON2 billion through an initial public offering on the Bucharest and London stock exchanges, promising to invest in networks and expand through acquisitions. The funds have not been invested yet, as the company failed in both buying Enel’s Romanian assets and Fondul Proprietatea’s minority stakes in Electrica subsidiaries.
Electrica said its consolidated net profit was at 126.8 million lei (EUR28.5 million) for the January-March period, up 32% compared with RON95.9 million in the similar interval of 2014, following an increase in delivered electricity quantities.
Total revenue increased 6.3% to RON1.34 billion, from RON1.26 billion in the first three months of 2014. The rise was supported by a 8.6% hike in revenue from supply and distribution of electricity, according to the company’s quarterly financial report.
Electrica, a company where the Romanian government controls a 48.8% stake, is listed on both Bucharest and London stock exchanges. Electrica shares traded flat in a Bucharest declining market.