Enerjisa Enerji (ENJSA) Q2 2024 earnings summary

Executive summary

• Strong operational performance across all segments, maintaining trajectory toward full-year targets despite a challenging environment.

• Revenue for the six months ended 30 June 2024 was TL 74.3 billion, down from TL 105.7 billion year-over-year, reflecting a significant contraction in top-line performance.

• The Group reported a net loss of TL 2.97 billion for the period, compared to a net loss of TL 0.86 billion in the prior year, indicating a deterioration in profitability.

• Operating profit before finance income/expense was TL 10.93 billion, up from TL 8.48 billion year-over-year, showing improved operational efficiency despite the net loss.

• Distribution investment program delivering results, with retail sales outperforming competitors and customer solutions maintaining growth momentum.

Financial highlights

• Group operational earnings rose 3% year-over-year to TL 18.3bn, outpacing inflation.

• Underlying net income declined 46% year-over-year to TL 2.0bn, mainly due to higher financial expenses and inflation accounting.

• Gross profit for the period was TL 18.09 billion, up from TL 15.77 billion year-over-year.

• Finance expenses surged to TL 9.44 billion from TL 4.28 billion year-over-year, significantly impacting net results.

• Free cash flow after interest and tax dropped to TL -5.9bn, impacted by distribution capex overspending and tariff mismatches.

Outlook and guidance

• On track to achieve FY 2024 targets: operational earnings of TL 40–45bn, underlying net income of TL 3.5–4.5bn, investments of TL 15–17bn, and regulated asset base of TL 55–60bn.

• Targeted dividend payout ratio of at least 80% of underlying net income.

• New retail tariffs effective 1 July 2024 include a 12.4% decrease for the Industrial group and increases of 2.5%-28.8% for other groups; distribution fees increased by 58.9%.

• The Group is assessing the impact of recent tax law amendments, including domestic and global minimum tax applications.