State owned energy utility EPS turned to a consolidated net loss of 87.4 million euro in 2014 from a net profit of 160.8MEUR a year earlier.
The company’s results were affected by record floods in May last year that disrupted the operation of coal-fired power plants and coal mines while prompting the utility to import coal and electricity.
Consolidated operating revenues were down to 212.5 billion dinars last year from 215.7 billion dinars in 2013 while operating expenses rose 3.2% to 188.95 billion dinars in the review period, the company data showed.
In July, the utility said it had completed the first phase of its reorganisation process and now functions through three instead of 14 legal entities, comprising a distribution unit, EPS Distribucija, supply unit, EPS Snabdevanje, and power production unit, EPS.
The new organisation – implemented in line with a decision adopted by the Serbian government in November – will be managed centrally while EPS’ operations will be more transparent, more efficient and more profitable.
The second phase of the restructuring process, which will include a status change to a joint stock company, should be completed by next summer.
Also in July, the European Bank for Reconstruction and Development said it was considering a sovereign guaranteed loan of up to 200 million euro ($219 million) to help restructure and refinance expensive short to medium-term financial debt which EPS had entered into on an emergency basis with commercial banks in order to alleviate the deteriorating cash situation created by the unprecedented and catastrophic floods in 2014.
In March, Serbian economy minister Zeljko Sertic said taking steps to restructure EPS alongside road company Putevi Srbije, railway operator Zeleznice Srbije and gas monopoly Srbijagas would be critical as they pose great risks for the country’s macro-economic stability.
In November, finance minister Dusan Vujovic said EPS should not be privatized piecemeal but should rather get a foreign partner for a capital hike.
The total net output capacity of the EPS power generation facilities added up to 7,124 MW at the end of 2014. The group’s electricity output fell 14.6% to 31,963 GWh in 2014.
