PGE's quarterly net loss is impacted by asset write-downs

PGE, Poland's largest energy company, reported on Tuesday a net loss for the second quarter of $9.61 billion zlotys (2.65 billion dollars), in line with its estimates. Impairments on tangible assets had a negative impact on the company. Why is it important? PGE, the largest state-controlled utility in Poland with a market capitalisation exceeding 24.83 billion Zlotys, reported a net loss of 9.61 billion zlotys ($2.65 billion) on Tuesday. This was in line with company estimates as impairments on its tangible assets took a toll.

The significant loss, mainly due to write-downs of its conventional assets highlights the financial costs of Poland's transition away from fossil fuels, and underlines the urgency for the company to pivot its strategic plan and move away from its old investment plan.

CONTEXT

PGE, along with other Polish utilities is transitioning away from coal. It announced a new investment strategy in June to invest 235 billion Zlotys (approximately $45 billion) by 2035 into renewable gas-fired energy plants and energy storage.

The company announced previously that it anticipated a net loss of 11.6 billion zlotys for the first half from impairments to tangible assets, mostly related to its conventional segment. BY THE NUMBERS

For the first half of this year, the company's recurring earnings before interest taxes, depreciation and amortization were 7.60 billion zlotys. The quarter's sales revenue was 13.80 billion Zlotys. $1 = 3.6291 Zlotys (Reporting and editing by Julia Kotowska, Marta Maciag)

(source: Reuters)