Kauno Energija

Interim / Quarterly Report • Aug 26, 2024

AB Kauno Energija

Company code 235014830

Raudondvario pl. 84

Kaunas, Lithuania

CONSOLIDATED AND COMPANY'S 6-MONTH CONDENSED SET OF INTERIM FINANCIAL STATEMENTS OF 2024 PREPARED IN ACCORDANCE WITH INTERNATIONAL FINANCIAL REPORTING STANDARDS AS ADOPTED BY THE EUROPEAN UNION (UNAUDITED)

CONFIRMATION OF RESPONSIBLE PERSONS TO THE SHAREHOLDERS OF AB KAUNO ENERGIJA AND THE BANK OF LITHUANIA

Pursuant to the provisions of the Republic of Lithuania Law on Securities and the Information Disclosure Rules approved by the Board of the Bank of Lithuania, we, Tomas Garasimavičius, Director General of AB Kauno energija, Virgilijus Motiejūnas, Financial director and Ramunė Petkevičienė, Head of Financial Management and Accounting Division, confirms that to our knowledge, AB Kauno energija set of shortened interim financial statements for the 6 months of 2024, prepared in accordance with the International Financial Reporting Standards adopted for application in the European Union, corresponds to reality and correctly shows the company's assets, liabilities, financial condition, profit (loss) and cash flows.

Tomas Garasimavičius

Dire

ctor General

Virgilijus Motiejūnas Director of Finance

Ramunė Petkevičienė Head of Financial Management and Accounting Division

Set of consolidated and company financial statements of 6 months of 2024 (in thousands euro, unless specified otherwise)

CONDENSED INTERIM FINANCIAL STATEMENTS

	Group		Company
	Notes	2024-06-30	2023-12-31	2024-06-30	2023-12-31
ASSETS
Fixed assets
Intangible fixed assets	6	204	249	196	241
Land and buildings		6 111	6 201	6 042	6 122
Buildings		143 329	134 610	143 329	134 610
Machinery and equipment		13 552	13 824	13 528	13 779
Vehicles		907	975	872	975
Plant and tools		4 939	3 263	4 894	3 217
Constructions in progress and prepayments		17 198	23 483	17 277	23 483
Investment property		1 073	1 114
Total property, plant and equipment		187 109	183 470	185 942	182 186
Assets managed under the right of use		1 093	1 083	927	916
Non-current financial assets
Investments in subsidiaries				2 763	2 763
Amounts receivable after one year		129	128
Other financial assets		75	75	75	75
Financial fixed assets, total		203	203	2 838	2 838
Non-current assets, total		186 610	185 005	189 903	186 181
Current assets
Stock and prepayments
Inventories	7	1 694	1 777	1 275	1 429
Prepayments		985	1 019	913	942
Total inventories and prepayments		2 679	2 796	2 188	2 371
Amounts receivable within one year
Term deposits
Trade receivables	8	3 296	14 437	3 113	13 621
Loans to the companies of the group of companies
Other amounts receivable	9	408	2 755	379	2 757
Amounts receivable within one year, total		3 704	17 192	3 492	16 378
Cash and cash equivalents	12	12 463	8 547	10 733	7 315
Current assets, total		18 846	28 535	16 413	26 064
Assets, total:		207 456	213 540	206 316	212 245

(continued on the next page)

CONDENSED INTERIM FINANCIAL STATEMENTS (CONTINUED)

Notes 2024-06-30 2023-12-31 2024-06-30 EQUITY AND LIABILITIES Property Capital 74 476 74 476 74 476 Legal reserve 13 7 447 7 447 7 447 Other reserves 13 75 50 75 Profit (loss) available for distribution Current year profit 4 505 5 506 5411 Profit (loss) of the previous years 15 546 11 128 14 725 Total retained profit (loss) 21 052 15 633 20 779 Total equity 103 050 97 606 102 134 Non-current amounts payable after one year and liabilities Long-term financial debts 10 54 736 54 736 54 736 Lease (financial lease) 1 121 1 143 971 6 517 Deferred profit tax liabilities 6 516 6 517 Grants and subsidies 30 038 30 850 30 038 Employee benefit liabilities 385 385 365 Other provisions Accounts payable after one year, 92 819 93 608 92 627 and long-term liabilities, total Accounts payable within one year of and other liabilities Current year's share of long-term financial debt and leasing/financial 10 2 049 3 269 2 047 leases Short-term financial debts Trade debtors 3 916 14 105 4 081 Payroll related liabilities 1 325 715 1 264 Received prepayments 1 028 840 1 003 159 Tax payable 804 82 Derivative financial instruments Current year's share of employee 154 163 153 benefit obligations Other provisions 11 2 347 2 347 1 652 Accrued costs and income of future 439 440 418 periods Other short-term amounts payable 170 338 160 and liabilities Accounts payable within one year 11 587 22 326 11 555 of and other liabilities, total Total accounts payable and 104 406 115 934 104 182 liabilities		Group			Company
						2023-12-31
						74 476
						7 447
						50
						3 881
						10 869
						14 750
						96 723
						54 736
						950
						6 516
						30 850
						365
						93 417
						3 265
						14 136
						701
						815
						612
						162
						1 652
						425
						337
						22 105
						115 522
	Total equity and liabilities		207 456	213 540	206 316	212 245

The notes below form an integral part of these financial statements.

CONDENSED INTERIM STATEMENT OF PROFIT (LOSS) AND OTHER GROSS INCOME

Group			30 June 2024		30 June 2023 from
	Comments	2024 II quarter	from the beginnin g of the year	2023 II quarter	the beginning of the year
Operating income
Sales revenue	14	12 394	49 214	8 420	51 317
Other operational incomes	16	168	729	184	461
Total operating income		12 562	49 943	8 604	51 778
Operating expenses
Fuel and purchased energy		(5 798)	(27 825)	(4 052)	(32 695)
Salaries, social insurance		(2 420)	(4 860)	(2 222)	(4 339)
Depreciation and amortisation		(1 833)	(3 582)	(1 700)	(3 335)
Repair and maintenance		(157)	(285)	(221)	(356)
Change in impairment of receivables		(334)	(335)	501	494
Taxes, other than income tax		(759)	(1 235)	(730)	(1 196)
Electricity		(263)	(958)	(230)	(852)
Raw materials and materials		(1 485)	(1 553)	(709)	(992)
Water		(522)	(1 124)	(506)	(963)
Change in realisable value of inventories and impairment of fixed assets	7	(97)	(112)	96	52
Other costs	15	(591)	(1 102)	(615)	(1 308)
Other operational expenses	16	(101)	(263)	(86)	(251)
Operating expenses, total		(14 360)	(43 234)	(10 474)	(45 741)
Operating profit (loss)		(1 798)	6 709	(1 870)	6 037
Other interest and similar income		117	287	171	455
Value impairment of financial assets and short-term investment
Interest and other similar costs		(459)	(885)	(336)	(607)
Income from financing and investment activities, net value		(342)	(598)	(165)	(152)
Profit before taxation		(2 140)	6 111	(2 035)	5 885
Income tax		91	91
Deferred income tax income (loss)
Profit for the reporting period		(2 049)	6 202	(2 035)	5 885
Termination benefits (accrual), other provisions to be reclassified to profit or loss when certain conditions are met		(696)	(696)	(1883)	(1 883)
Gross income		(2 745)	5 506	(3 918)	4 002
Profit for the period attributable to the Company's shareholders		(2 049)	6 202	(2 035)	5 885
Gross income attributable to the Company's shareholders		(2 745)	5 506	(3 918)	4 002
Earnings per share (EUR)	17	(0,06)	0,13	(0,09)	0.09

CONDENSED INTERIM STATEMENT OF PROFIT (LOSS) AND OTHER GROSS INCOME

Company	Comments	2024 II quarter	30 June 2024 from the beginning of the year	2023 II quarter	30 June 2023 from the beginning of the year
Operating income
Sales revenue	14	10 684	47 504	8 291	51 100
Other operational incomes	16	486	835	136	337
Total operating income		11 170	48 339	8 427	51 437
Operating expenses
Fuel and purchased energy		(5 806)	(27 833)	(4 771)	(33 414)
Salaries, social insurance		(2 278)	(4 588)	(2 094)	(4 143)
Depreciation and amortisation		(1 832)	(3 566)	(1 665)	(3 271)
Repair and maintenance		(153)	(276)	(219)	(354)
Change in impairment of receivables		(318)	(317)	501	494
Taxes, other than income tax		(754)	(1 225)	(723)	(1 179)
Electricity		(267)	(962)	(230)	(852)
Raw materials and materials		(157)	(301)	(191)	(374)
Water		(522)	(1 124)	(507)	(863)
Change in realisable value of inventories and impairment of fixed assets	7	(97)	(112)	તેહ	52
Other costs	15	(569)	(1 108)	(611)	(1 399)
Other operational expenses	16	(139)	(301)	(86)	(258)
Operating expenses, total		(12 892)	(41 713)	(10 500)	(45 661)
Operating profit (loss)		(1 722)	6 626	(2 073)	5 776
Other interest and similar income Value impairment of financial assets and short-term investment		106	275	171	455
Interest and other similar costs		(459)	(885)	(336)	(602)
Income from financing and investment activities, net value		(353)	(610)	(165)	(147)
Profit before taxation		(2 075)	6 016	(2 238)	5 629
Income tax		91	91
Deferred income tax income (loss)
Profit for the reporting period		(1 984)	6 107	(2 238)	5 629
Termination benefits (accrual), other provisions to be reclassified to profit or loss when certain conditions are met		(୧୨୧)	(696)	(1 883)	(1 883)
Gross income		(2 680)	5 411	(4 121)	3 746
Earnings per share (EUR)	16	(0,06)	0,13	(0,10)	0,09

The notes below form an integral part of these financial statements.

CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY

Group	Notes	Capital	Legal reserve	Other reserves	Profit (loss) available for distribution	Total
Balance as at 31 December 2022		74 476	7 447	3 000	11 178	96 101
Formed reserves				50	(50)
Reversed reserves			-	(3 000)	3 000
Dividends					(3 000)	(3 000)
Profit for the reporting period					6 078	6 078
Other gross income					(1 573)	(1 573)
Balance as at 31 December 2023		74 476	7 447	50	15 633	97 606
Formed reserves				75	(75)
Reversed reserves				(20)	50
Dividends
Profit for the reporting period				-	6 202	6 202
Other gross income					(758)	(758)
Balance as at 30 June 2024		74 476	7 447	75	21 052	103 050

Company	Notes	Capital	Legal reserve	Other reserves	Profit (loss) available for distribution	Total
Balance as at 31 December 2022		74 476	7 447	3 000	10 919	95 842
Formed reserves				50	(50)
Reversed reserves			-	(3 000)	3 000
Dividends					(3 000)	(3 000)
Profit for the reporting period				-	5 454	5 454
Other gross income				-	(1 573)	(1 573)
Balance as at 31 December 2023		74 476	7 447	50	14 750	96 723
Formed reserves				75	(75)
Reversed reserves				(50)	50
Dividends
Profit for the reporting period				-	6 107	6 107
Other gross income					(696)	(696)
Balance as at 30 June 2024		74 476	7 447	75	20 136	102 134

The notes below form an integral part of these financial statements.

CONDENSED INTERIM CASH FLOW STATEMENTS

		Group		Company
	Notes	2024 y	2023 y	2024 y	2023 y
Cash flows from (to) operating activities
Gross income		5 506	4 002	5 411	3746
Adjustments to non-cash items:
Depreciation and amortisation		4 564	4 268	4 579	4 263
Grants and subsidies (amortisation)		(779)	(168)	(779)	(494)
Write-offs and changes in impairment of receivables		318	(494)	318	(768)
Results transferred to the tangible fixed assets		1 593		1 499
Loss (gain) on sale and write-down of fixed assets and value of shares		(97)	14	97	(14)
Change in realisable value of inventories and impairment of fixed assets		112	(52)	112	(52)
Change in employee benefits liability		(9)	(39)	(9)	(39)
Change in lease liability		(20)		(20)
Amortization of rights to property		10		10
Changes in other non - monetary items			(76)
Change in accumulations		(7)	59	(7)	24
Change in provision liabilities		695	1 883	695	1883
Elimination of financial and investment perfomance		610	152	610	147
Adjustment to total non-cash items		7 184	4 919	7 105	4 950
Changes of working capital:
Decrease (increase) in inventories		83	(35)	154	523
Decrease (increase) in prepayments		34	38	29	(128)
Decrease (increase) in trade receivables		10 823	15 180	10 508	15 109
Decrease (increase) in other amounts receivable		2 347	2817	2 378	2 807
Increase (decrease) in long-term trade debts
Increase (decrease) in trade debtors		(10 189)	(13 075)	(10 373)	(13 110)
Decrease (increase) in liabilities related to employment relations		610	454	563	431
Increase (decrease) in taxes payable		(645)	(438)	(530)	(394)
Decrease (increase) in received prepayments		188	491	188	478
Increase (decrease) in other current liabilities		(168)	128	(177)	(94)
Changes in total working capital		3 083	5 560	2 740	5810
Net cash flows from operating activities		15 773	14 481	15 256	14 506

(continued on the next page)

CONDENSED INTERIM CASH FLOW STATEMENTS (continued)

		Group		Company
	Notes	2024 y	2023 y	2024 y	2023 y
Cash flows from (to) investing activities
Acquisition of intangible fixed assets and property, plant and equipment		(9 613)	(7 097)	(9 582)	(7 090)
Sale of property, plant and equipment		2	3 235	2	288
Interest received on overdue receivables		287		275
Acquisition of investments, change in value			(5 000)		(5 000)
Net (used) cash flows from investing activities		(9 324)	(11 774)	(9 305)	(11 802)
Cash flows from (to) financing activities
Loans received
Loans repaid		(1 212)	(1 096)	(1 212)	(1 096)
Interest paid		(1 321)	(664)	(1 321)	(664)
Rent payments
Dividend paid		-	(3 000)		(3 000)
Subsidy received			149		149
Net cash flows from (used in) financing activities		(2 533)	(4 611)	(2 533)	(4 611)
Net increase (decrease) in cash flows		3 916	(1 904)	3 418	(1 907)
Cash and cash equivalents at the beginning of the period		8 547	5 550	7 315	4 891
Cash and cash equivalents at the end of the period		12 463	3 646	10 733	2 984
					(end)

The notes below form an integral part of these financial statements.

9

NOTES TO THE CONDENSED SET OF INTERIM FINANCIAL STATEMENTS

1. General information

AB Kauno Energija (hereinafter referred to as the Company) is a public limited liability company registered in the Republic of Lithuania. Its registered office address is Raudondvario pl. 84, Kaunas, Lithuania. Data about the Company is collected and stored in the Registry of Legal Entities.

The Company is engaged in the supply of heat and hot water, production and sale of electricity and maintenance of collector-tunnels.

maintenance of collectors-tunnels. The Company also provides heating system maintenance services. The Company was registered on 1 July 1997 following the reorganisation of AB Lietuvos Energija. The company code 235014830. The Company's shares are traded on the Baltic Additional Trading List of the Nasdaq Vilnius Stock Exchange.

As at 30 June 2024 and 31 December 2023, the Company's shareholders were:

	2024-06-30		2023-12-31
	Number of held shares, units	Ownership (%)	Number of held shares, units	Ownership (%)
Kaunas city municipality	39.736.058	92.84	39.736.058	92.84
Kaunas district municipality	1.606.168	3.75	1.606.168	3,75
Jurbarkas district municipality	746.405	1.74	746.405	1,74
Other minor shareholders	713.512	1,67	713.512	1,67
	42.802.143	100.00	42.802.143	100.00

The Company's authorised capital is equal to EUR 74,475,728.82 and is divided into 42,802,143 ordinary shares with a nominal value of EUR 1.74 each. As at 30 June 2024 and 31 December 2023, the Company had no own shares. As at 30 June 2024 and 31 December 2023, all shares were fully paid up.

On 30 June 2024, the Company and its subsidiary UAB GO Energy LT form a group (the Group):

Company, registered office address	Group's shareholding	Cost of investment	Retained profit (loss)	Legal reserve	Equity	Main activities
UAB GO Energy LT, Raudondvario pl. 84, Kaunas	100 per cent.	2 763	1 006	57	3 826	Innovative energy projects, consultancy, rental

The Company and the Group also own 22% interest in UAB Kauno miesto paslaugy centras. The cost of the investment is EUR 75 thousand (the amount of the investment is included under 'Other financial assets').

The Group's average number of listed employees during the reporting period was 367 and the Company's average number of listed employees was 338.

Legal regulation

Pursuant to the Law of the Republic of Lithuania on the Heat Sector, the Company's activities are licensed and regulated by the State Energy Regulatory Council (hereinafter referred to as the Council). On 26 February 2004 the Council granted the Company a heat supply licence is valid for an unlimited period, but may be revoked by an appropriate decision of the Council depending on compliance with certain conditions. The Council also sets price caps for the supply of heat. 13 September 2018 By Resolution No. O3E-283, the Council established for the Company the components of the basic heat price, which were valid until March 31, 2024.

General information (continued)

As of 1 April 2024, new heat prices came into force, calculated in accordance with the level of heat production and supply revenues unilaterally established by the Council Resolution of 23 February 2024 by AB "Kauno energija".

Economic activities

The Company's production capacities consist of the Petrasiunai power plant, 5 boiler houses in Kaunas integrated network, 7 regional boiler houses in Kaunas district, 1 in Jurbarkas, 14 isolated network and 26 local (household) boiler houses in Kaunas city, as well as 8 boiler houses for water heating in Sargenai district.

The total installed thermal capacity of the Company is approximately 596 MW (of which 53 MW are condensing economizers), electrical, 8.75 MW, including 220 MW thermal capacity of the Petrašiūnai power plant (of which 17.8 MW is condensing economizer) and 8 MW electrical capacity, in Jurbarkas 39.4 MW thermal capacity (including 4.4 MW-a condensing economizer). The total power generation capacity of the Company as a whole is approximately 605 MW (of which 53 MW are condensing economizers).

The Company makes investments based on an assessment of the economic situation, the competitive environment and the availability of financing. Investment plans are approved by the shareholders and coordinated by the Council.

2. Basis of preparation of the financial statements

The condensed interim financial statements of the Company and the Group for the six-month period ended 30 June 2024 have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union (hereinafter the IFRSs) as applicable to interim financial reporting (International Accounting Standard (IAS) 34 "Interim Financial Reporting"). These financial statements do not include all the information necessary for the preparation of the full set of consolidated and separate financial statements. However, selected notes are included to explain events and transactions and to provide an understanding of significant changes in the Group's and the Company's financial position and financial performance.

All accounting principles applied in the preparation of the condensed interim financial information are the same as those applied in the preparation of the annual financial statements for 2023.

The new standards and amendments effective from 1 January 2024 have no material impact on the Group's and Company's financial statements.

The currency of the submission is the euro. These statements are presented in thousands of euro, unless otherwise stated.

The Company's financial year coincides with the calendar year.

The management of the Company has approved the following interim financial statements as at 08 August 2024.

3. Application of assessments in preparation of financial statements

In preparing financial statements in accordance with IFRSs adopted for application in the EU, management shall make calculations and estimates of assumptions that affect the application of accounting principles and of amounts related to assets and liabilities, income and expenses. The estimates and related assumptions are based on historical experience and other factors that are consistent with current conditions and the results of which lead to conclusions about the residual values of assets and liabilities that are not available from other sources. The actual results could differ from the estimates and related assumptions are kept under constant review. Adjustments to estimates are recognised prospectively.

The key assumptions and other significant sources of estimation uncertainty at the interim statements of financial position that have a significant risk of causing a material adjustment to the carrying amounts of assets or liabilities within the next financial year are the same as those described in the most recent set of annual separate and consolidated financial statements.

এ. Definition of lease

Until 1 January 2019 the Group and the Company determined at the time of signing the agreement whether the agreement meets the definition of lease in accordance with IFRIC 4 "Determining Whether an Arrangement Contains a Lease". From 1 January 2019, when an agreement is concluded, the determining whether an arrangement contains a lease or includes a lease is based on the new definition. Under IFRS 16, A contract, or part of a contract, that conveys the right to use an asset for a period of time in exchange for consideration.

In evaluating or re-evaluating an agreement that contains a lease component, the Group and the Company allocate the contractual consideration provided for in the agreement to each of the agreement that have and do not have a lease component on the basis of their relative stand-alone prices. However, in the case of leases of immovable property where the Group and the Company are lessees, the Group and the Company have chosen not to separate the lease-free components and instead to account for the leasecontaining components together as a single lease component.

The Group and the Company, as tenant, have previously classified the lease as an operating or finance lease based on an assessment of whether the lease agreement essentially provides for the transfer of all risks and rewards of ownership. The Group and the Company recognise right-of-use assets and lease liabilities in lease agreements in accordance with the provisions of IFRS 16. These leases are shown in the balance sheet.

Assets held under usufruct are presented by the Group and the item of assets held under usufruct.

Recognised lease liabilities are presented in the statements of financial position under lease) and long-term financial debts and leasing (finance lease) for the current year.

5 Measurement of fair value

At initial recognition, the transaction price of an acquired asset or a liability assumed in an exchange transaction entered into for a particular asset or liability is the price paid at the time the asset is acquired or the liability is assumed (the acquisition price). In comparison, the fair value of the asset or liability is the price that would be obtained from the sale of the asset or paid for the disposal of the sale/transfer price).

If the Company initially measures an asset or liability at fair value and the transaction price differs from fair value, the difference is recognised as a gain or loss unless otherwise specified in the IFRSs.

The fair value measurement is based on the assumption that a transaction for the sale of an asset or the disposal of a liability will be carried out either:

• in the underlying market for the asset or liability, or
• in absence of a principal market, the most favourable market for the asset or liability in question.

Where observable variables that are directly observable by the Company are not available at the measurement date, i.e. prices quoted (not adjusted) in active markets for ilabilities, fair value is determined by reference to adjusted observable variables that are directly observable. Adjusted variables are:

• prices quoted for similar assets or liabilities in active markets;
• prices quoted for identical or similar assets or liabilities in markets that are not active markets;
• variables other than quoted prices observed for a specific asset or liability;
• market-confirmed variables.

Where observable variables are not available (directly), fair value shall be determined by reference to unobservable variables that the Group and the Company produce using valuation techniques.

The fair value measurement of a non-financial asset shall take into account the ability of the market participant to generate economic benefits by using the specific asset to its maximum and best value or by selling it to another market participant that will use it to its maximum and best value.

The fair value of liability reflects the impact of inactivity risk includes, but is not limited to, the entity's own credit risk. When determining the fair value of a liability, an entity shall assess the effects of its credit risk (financial position) and other factors that may affect the liability will or will not be met.

Measurement of fair value (continued)

The Group and the Company must increase the use of relevant observable variables and reduce the use of unobservable variables in order to achieve the objective of fair value measurement by calculating the price at which a liability or equity instrument would be transferred under a legally orderly transaction between market participants at the valuation date in accordance with prevailing market conditions.

Assets and liabilities that are measured at fair value in the statement of financial position, or for which fair value is not determinable but for which disclosures are made, are classified by the Group and the Company in accordance with the fair value hierarchy, which categorises variables into three levels depending on their availability:

• Level 1 variables are quoted (unadjusted) prices for identical assets or liabilities in an active market that are available to the Company at the date of valuation;
• Level 2 variables are variables, other than quoted prices which are classified as Level 1, that are observable directly or indirectly for a specific asset or liability;
• Level 3 variables are unobserved variables applied to a specific asset or liability.

When the variables used to measure the fair value of an asset or liability may be classified in different levels of the fair value hierarchy, the entire fair value measurement result is classified in the fair value hierarchy as the lowest level variable that is significant to the entire measurement.

6. Property, plant and equipment

During the first half of 2024, acquisitions of fixed tangible assets of the Group and the Company amounted to EUR 9,634 thousand EUR and 9,582 thousand EUR. The residual value of the sold-written-off tangible fixed assets amounted to EUR 97 thousand EUR and 97 thousand EUR. The cost of the acquired property includes all expenses related to the construction, purchase and materials of the property, including 1,593 thousand EUR of capitalized interest and other common costs.

Depreciation costs of real estate, equipment and equipment of the Group and the Company in the first half 2024 consists of 4, 584 thousand EUR and 4,509 thousand EUR. The amounts of the depreciation expenses of the Group and the Company were included in the operating expenses in the Profit and Loss and Other Gross Income statements in the depreciation and amortization, and other expenses lines. Part of the cost of depreciation - 779 thousand EUR (both the group and the companies) was covered by the grant amounts received.

The management of the Group and the Company, having assessed the internal signs, in the first half of 2024, it did not find a significant additional decrease in the value of real estate, equipment and equipment.

Part of the Group's real estate, equipment, the acquisition value of which for the state as of 30 June 2024 was equal to 34, 156 thousand EUR (as of 31 December 2023 - 34,694 thousand EUR), companies - 34,156 thousand EUR was completely depreciated (34,694 thousand EUR as of 31 December 2023), but is still used in activities.

As of 30 June 2024 and 31 December 2023 The Group and the Company's majority of the construction in progress consists of reconstruction and overhaul of boiler houses and heat supply networks.

As of 30 June 2024, real estate, equipment, the residual value of which was equal to the Group's 8,548 thousand EUR (as of 31 December 2023 - 8,548 thousand EUR), and companies - 8,548 thousand EUR (as of 31 December 2023 - 8,548 thousand EUR), was pledged to banks as collateral for loans.

7. Inventories

	Group		Company
	2024-06-30	2023-12-31	2024-06-30	2023-12-31
Technological fuels	ଚିରିତ । ପରିବର	1 162	ପିଟିରେ	1 162
Spare parts	800	731	381	383
Materials	385	333	385	333
	2 151	2 226	1 732	1 878
To be deducted: write-down to net realisable value at the end of the period	(457)	(449)	(457)	(449)
Carrying amount of inventories	1 694	1 777	1 275	1 429

The depreciation of the inventories of the Group and the Company to the net potential realizable value as of 30 June 2024 amounted to EUR 457 thousand (as of 31 December 2023, EUR 449 thousand). Change in the depreciation of inventories to net potential realizable value in 2024 and 2023 in the Group's and the Company's Income and Other Gross Income Accounts are included in the cost item of the change in the realization cost of inventories.

8. Amounts receivable from buyers

	Group		Company
	2024-06-30	2023-12-31	2024-06-30	2023-12-31
Trade receivables	7 967	18 799	7 768	17 943
To be deducted: expected credit losses	(4 671)	(4 362)	(4 655)	(4 322)
	3 296	14 437	3 113	13 621

Change in impairment of doubtful receivables as of 30 June 2024 and 31 December 2023 in the Group's and the Company's Statements of Profit and Loss and Other Gross Income included in the item of impairment charges on receivables. Impairment of doubtful receivables is measured at expected credit losses.

The amounts receivable by the Group and the Companies from buyers are interest-free and, as a rule, their due date is 30 days or agreed individually.

	Group		Company
	2024-06-30	2023-12-31	2024-06-30	2023-12-31
Refundable taxes	395	817	365	817
Other receivables	275	2 213	275	2 215
To be deducted: expected credit losses	(262)	(275)	(262)	(275)
	408	2 755	378	2 757

0 Other receivables

Set of consolidated and company financial statements of 6 months of 2024 (in thousands euro, unless specified otherwise)

As of 30 June 2024 and 31 December 2023 Other receivables of the Group and the Company consisted of state taxes receivable, municipal debt for compensation to low-income families, receivables for the sale of stocks (scrap metal, installations of heating systems), and services rendered (manifold maintenance, etc.).

The Group's and the Company's other receivables are interest-free and usually have a maturity of 30-45 days. For unmatured receivables, a decrease in value is not calculated, since in the opinion of management there is no indication that borrowers will not be able to fulfill their obligations.

Credit risk

The Group and the Company are not exposed to significant concentrations of credit risk as they deal with a large number of customers.

10. Financial debts

All loans of the Group and the Company are accounted for and repaid in euro. The weighted average (percentage) of the interest rate on outstanding loans as of 30 June 2024 and 31 December 2023 was as follows:

	Group		Company
	2024-06-30	2023-12-31	2024-06-30	2023-12-31
Short-term
Long-term	4.29	4.41	4.29	4.41

Repayment terms of long-term loans:

	Group		Company
	2024-06-30	2023-12-31	2024-06-30	2023-12-31
Long-term financial debts (loans):	54 736	54 736	54 736	54 736
Payable between 2 and 5 years	22 506	22 506	22 506	22 506
Payable after 5 years	32 230	32 230	32 230	32 230
Current portion of long-term loans	2 041	3 231	2 041	3 231
	56 777	57 967	56 777	57 967

As of 30 June 2024 in the statement of financial standing, the Group and the Company have recorded interest payable to financial institutions under long-term financial debts amounted to EUR 206 thousand respectively.

Details of the Group's and Company's loans as of 30 June 2024:

	Credit institution	Date of contract	Amount. thousands EUR	Maturity	Balance as of 2024-06-30 in thousands EUR	To be repaid in 2024. thousand EUR
1	EIB **	2020-08-07	15 000	2035-08-24	11 250	500
2	EIB **	2020-08-07	12 000	2036-08-18	11 094	453
3	EIB**	2020-08-07	14 000	2037-08-22	14 000	528
4	EIB **	2020-08-07	14 000	2038-09-29	14 000	O
5	Min. of Finance*	2010-10-26	807	2034-03-15	385	0
6	Min. of Finance*	2010-04-09	2 410	2034-03-15	936	O
	Min. of Finance*	2014-01-15	793	2034-12-01	458	42
8	Min. of Finance*	2014-03-31	7 881	2034-12-01	4 549	413
9	AB SEB bankas	2016-12-22	1 157	2024-11-30	105	105

Set of consolidated and company financial statements of 6 months of 2024 (in thousands euro, unless specified otherwise)

56 777 2041

Financial debts (continued)

* Ministry of Finance of the Republic of Lithuania; ** European Investment Bank.

AB SEB Bankas has determined that the Company must comply with the net financial debt to EBITDA ratio set for the quarter, which must not exceed 4.5. Under the loan agreements, the Company's equity ratio (total equity/total assets) must be at least 35%. The European Investments also stipulate that the Company must comply with both of these indicators. As at 30 June 2024, the Company has met its indicators.

Loan agreements contain certain restrictions. The Company may not grant dividends, issue and/or obtain new loans, make grants, sell or lease mortgaged assets without the written consent of the banks.

On 26 March 2024, the Company entered into a credit agreement with AB SEB Bankas for the financing of the working capital, under which the overdraft limit of EUR 5 million for a period of 12 months was approved. As at the date of the financial statements, the amount of the overdraft limit has not been used.

11. Other provisions

As at 31 December 2023, the Company has made a provision of EUR 1,573 thousand to cover the differences in the actual cost of electricity, purchased heat, fuel and production included in the price of heat sold and actually incurred, i.e. to cover future price reduction liabilities. On June 30, 2024, the company additionally formed a provision for 696 thousand EUR. The total provision formed as of 30 June 2024 amounted to EUR 2,347 thousand.

12. Cash and cash equivalents

	Group		Company
	2024-06-30	2023-12-31	2024-06-30	2023-12-31
Cash on the road	285	700	285	700
Cash in the bank	12 178	7 847	10 448	6615
	12 463	8 547	10 733	7 315

Group bank accounts with a balance of EUR 1004 thousand on 30 June 2024 (EUR 1,073 thousand on 31 December 2023) and the Company's EUR 1,004 thousand (on 31 December 2023: EUR 1,073 thousand) are pledged to banks as collateral for the loan.

13. Changes in equity

Statutory reserve and other reserves

The statutory reserve is required under the legislation of the Republic of Lithuania. At least 5% of net profits, calculated in accordance with International Financial Reporting Standards, must be transferred to the reserve annually until it reaches 10% of the authorised capital. The statutory reserve may not be distributed as dividends but can be used to cover future losses

14. Sales income

The Group and the Company are engaged in the supply of heat energy and hot water, maintenance of building heating and hot water supply systems, electricity generation, and other activities are closely interlinked and, for management purposes, the Group and the Company are considered to be organised in a single segment - the supply of heat energy.

The Group's and the Company's activities are seasonal, with the majority of revenue generated during the heating season, which starts in October and ends in April.

Sales revenues by the Group and the Company activities are presented below:

	Group		Company
	30 June 2024 from the beginning of the year	30 June 2023 from the beginning of the year	30 June 2024 from the beginning of the year	30 June 2023 from the beginning of the year
Heat supply	43 831	47 804	43 838	47 803
Hot water supply	3 162	2 843	3 162	2844
Maintenance of hot water metering devices	2 043	483	326	265
Maintenance of collectors	174	174	174	175
Maintenance of heating and hot water systems in buildings	4	10	4	10
Cooling supply		3		3
Sale of tradable emission allowances
	49 214	51 317	47 504	51 100

Sales revenues by consumer groups of the Group and the Company are presented below:

	Group		Company
	30 June 2024 from the beginning of the year	30 June 2023 from the beginning of the vear	30 June 2024 from the beginning of the year	30 June 2023 from the beginnin g of the year
Residents	34 934	37 597	34 934	37 597
Other users	5 591	5 851	5 591	5 851
Budgetary organisations financed from the state budget	3 319	3 521	3319	3 521
Budgetary organisations financed from municipal budgets	2 128	2 440	2 128	2 440
Institutions financed by territorial sickness funds	1 226	1 333	1 226	1 333
Industrial users	2 016	575	306	358
	49 214	51 317	47 504	51 100

15. Other costs

Other costs include:

	Group		Company
	30 June 2024 from the beginning of the year	30 June 2023 from the beginning of the year	30 June 2024 from the beginning of the year	30 June 2023 from the beginning of the year
Equipment inspection and testing	133	156	76	127
Maintenance of collectors	182	181	182	181
Money collection costs	62	62	62	62
Ash recovery costs	76	113	76	113
Information Technologies costs	29	53	29	53
Consulting Services	64	136	64	136
Employee-related costs	62	57	62	57
Invoicing costs	56	56	56	56
Membership fee	43	55	43	55
Maintenance of fixed assets and related services	71	43	71	43
Transport costs	46	46	46	46
Debt collection costs	61	62	61	62
Insurance	53	57	53	57
Communication costs	38	30	38	30
Costs for advertising	15	15	15	15
Audit costs	35	27	35	27
Rental of equipment and machinery	22	32	22	32
Sponsorship		117		117
Other costs	54	10	117	130
	1 102	1 308	1 108	1 399

16. Other operating income and expense

Other operating income includes:

	Group	Company
	30 June 2024 from the beginning of the year	30 June 2023 from the beginning of the year	30 June 2024 from the beginning of the year	30 June 2023 from the beginning of the year
Other operational incomes
Inventories sold	458	80	458	80
Miscellaneous services rendered	160	227	266	103
Compensation received	8	15	8	15
Revenue from previous periods
Profit from the sale of fixed assets	1	10	1	10
Other	102	129	102	129
	729	461	835	337

Other operating income and expense (continued)

Other operating expenses include:

	Group		Company
Other operational expenses	30 June 2024 from the beginning of the year	30 June 2023 from the beginning of the year	30 June 2024 from the beginnin g of the year	30 June 2023 from the beginning of the year
Cost of miscellaneous services rendered	(48)	(106)	(86)	(113)
Inventories sold	(92)	58)	(92)	(58)
Cost of previous periods	(38)	(34)	(38)	(34)
Sale of fixed assets, write-off	(2)	(3)	2)	(3)
Other	(83)	50)	(83)	(50)
	(263)	(251)	(301)	(258)

The Group and the Company lease real estate, supply technical water, perform maintenance of heating equipment.

17. Basic and diluted earnings per share

The Group's basic and diluted earnings per share calculations are presented below:

	Group		Company
	2024 H1	2023 H1	2024 H1	2023 H1
Profit for the reporting period	5 506	4 002	5411	3 746
Number of shares (thousands), beginning of period	42 802	42 802	42 802	42 802
Number of shares (thousands), end of period	42 802	42 802	42 802	42 802
Weighted average number of ordinary shares in issue (thousands)	42 802	42 802	42 802	42 802
Basic and diluted earnings per share (EUR)	0,13	0,09	0,13	0.09

18. Commitments and contingencies not included in the balance sheet

AB Kauno energija submitted a complaint to the Regional Administrative Court on 26.02.2024 against Council Resolutions No O3E-141 "On the determination of the level of heat production and /or supply income of AB Kauno energija for the first year of validity of the basic level of heat production and /or supply income", and on 23.02.2024 adopted Resolution No O3E-213 "On the unilateral determination of the level of heat production and (or) supply income of AB Kauno Energija for the first year of validity of the basic level of heat production and /or supply income for the first year of validity of the basic level of heat production and /or supply income" cancellation of part. The amount of the complaint amounts to 2,587.50 thousand. Eur.

19. Related party transactions

The parties are considered to be related if one party can control the other party or has significant influence over the other party in making financial or operational decisions.

In 2024 and 2023, the Group and the Company did not have any significant transactions with other companies controlled by Kaunas City Municipality, except for the purchase or provision of utility services. Transactions with Kaunas City Municipality and companies controlled by Kaunas City Municipality were carried out at market prices.

In 2024 and 2023, the Group's and the Company's transactions with Jurbarkas City Municipality, Kaunas City Municipality and companies financed and controlled by Kaunas City Municipality, whereas their debts and liabilities as at the end of the periods were as follows:

2024 half	Purchases	Sales	Amounts receivable	Amounts payable
Kaunas City Municipality, companies financed and fully managed by it	1 211	4 109	320	380
Jurbarkas district municipality	10	159	11	র্ব
2023 half	Purchases	Sales	Amounts receivable	Amounts payable
Kaunas City Municipality, companies financed and fully managed by it	828	6613	353	408
Jurbarkas district municipality	9	175	1	র্ব

Sales include the amounts of reimbursements for housing heating costs, cold water and sewage costs, and hot water costs for financially challenged residents.

As of 30 June 2024 and 30 June 2023 The company's transactions with subsidiaries and balance sheet balances at the end of the period were as follows:

UAB GO Energy LT	Purchases	Sales	Amounts receivable	Amounts payable
2024 half	1 256	113	18	556
2023 half	67	772	9	228

UAB GO Energy LT provides real estate management services to AB Kauno Energija and participates in unregulated energy development projects together with its parent company.

20. Management's salary and other benefits

On 30 June 2024, the Group's and the Company's management consists of 2 and 1 on 31 December 2023), respectively.

As at 30 June 2024, the Company's Management Board consisted of 3 members and the Supervisory Board consists of 3 members.

	Group		Company
	2024 I half	2023 I half	2024 I half	2023 I half
Wages and salaries charged to the management	તે જિલ્લામાં આવેલું એક ગામનાં લોકોનો મુખ્ય વ્યવસાય ખેતી, ખેતમજૂરી તેમ જ પશુપાલન છે. આ ગામનાં મુખ્યત્વે ખેત-ઉત	82	80	79
The Board	52	40	52	40
The Supervisory Board	42		42	11
Reimbursements of employee benefits calculated for the management

Management's salary and other benefits (continued)

During I half 2024 and I half 2023, there were no loans, guarantees, other disbursements or accruals to the management of the Group and the Company, or transfers of assets.

21. Events after the date of the balance sheet

There have been no other events after the reporting date that could have a material effect on the financial statements or that should be disclosed in the financial statements.