WOOD Flash – Enerjisa Enerji: 3Q20 results review – double-digit growth, double-digit beat
Yesterday (3 November), after the market closed, Enerjisa reported very good 3Q20 results, well above estimates. In 3Q20, the company posted underlying net profit of TRY 662m (+99% yoy) on operational earnings of TRY 1,623m (+33% yoy) and revenues of TRY 5,782m (+10% yoy). The revenues were in line with both our and the market’s estimates, but the operational earnings beat the estimates by 21% and 23%, respectively, leading to 45% and 51% beats on the underlying net profit, respectively. Versus our numbers, the beat came mainly from the retail segment (both regulated and free), but also a better performance in distribution. Enerjisa’s 9M20 results are already close to our full-year estimates and, with the more bullish 2020E guidance provided by the company yesterday, there is upside risk for our forecasts and price target (PT) of TRY 10/share. The company’s net debt declined by 6% qoq, to TRY 9.9bn, with the higher capex offset by the strong FCF generation of TRY 609m in 3Q20. Thanks to this and the operational earnings growth, the financial net debt/operational earnings declined qoq, to 1.9x from 2.1x, in line with the company’s end-2020EEnerjisa Enerji AS is a Turkey-based company engaged in the utilities sector. The Company, together with its subsidiaries, is primarily engaged in making investments in energy companies, and deals with the generation, sale, and distribution of electricity, as well as the trade of natural gas. The Company reports its business activities into two main segments: Electricity Distribution and Retail. The Electricity distribution segment includes the transmission of electricity over lines users through distribution networks and provides infrastructure investments in conformity with the energy market regulation authority (EMRA). The Retail segment conducts mainly retail sales of electricity to customers. Enerjisa Enerji AS operates through a number of subsidiaries, such as Baskent Edas, Ayedas and Toroslar Edas, among others.
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