CEZ A.S.

Quarterly Report • Nov 12, 2019

ČEZ, a. s.

SEPARATE FINANCIAL STATEMENTS

PREPARED IN ACCORDANCE WITH INTERNATIONAL FINANCIAL REPORTING STANDARDS AS OF SEPTEMBER 30, 2019

ČEZ, a. s. BALANCE SHEET AS OF SEPTEMBER 30, 2019

in CZK Millions

	September 30, 2019	December 31, 2018
ASSETS:
Plant in service Less accumulated depreciation and impairment	459,593 (255,395)	454,354 (244,830)
Net plant in service	204,198	209,524
Nuclear fuel, at amortized cost Construction work in progress, net	14,076 7,407	14,331 7,242
Total property, plant and equipment	225,681	231,097
Restricted financial assets, net Other non-current financial assets, net Intangible assets, net	14,427 181,056 4,691	13,336 177,479 4,235
Total other non-current assets	200,174	195,050
Total non-current assets	425,855	426,147
Cash and cash equivalents, net Trade receivables, net Income tax receivable Materials and supplies, net Fossil fuel stocks Emission rights Other current financial assets, net Other current assets, net Assets classified as held for sale, net	1,202 57,955 21 6,809 526 19,113 58,540 3,030 6,540	454 64,287 7 6,526 462 13,157 106,133 2,362 6,540
Total current assets	153,736	199,928
Total assets	579,591	626,075

ČEZ, a. s. BALANCE SHEET AS OF SEPTEMBER 30, 2019

continued

	September 30, 2019	December 31, 2018
EQUITY AND LIABILITIES:
Stated capital Treasury shares Retained earnings and other reserves	53,799 (2,885) 142,115	53,799 (3,534) 132,947
Total equity	193,029	183,212
Long-term debt, net of current portion Provisions Other long-term financial liabilities Deferred tax liability	115,098 64,079 9,975 6,774	133,026 62,971 13,776 4,539
Total non-current liabilities	195,926	214,312
Short-term loans Current portion of long-term debt Trade payables Provisions Other short-term financial liabilities Other short-term liabilities	10,721 25,743 46,507 7,060 99,758 847	11,709 5,590 51,208 6,889 152,544 611
Total current liabilities	190,636	228,551
Total equity and liabilities	579,591	626,075

ČEZ, a. s. STATEMENT OF INCOME FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2019

in CZK Millions

	1-9/2019	1-9/2018 *	7-9/2019 **	7-9/2018 *
Sales of electricity, heat and gas Sales of services and other revenues Other operating income	58,771 3,731 777	50,898 3,550 572	17,913 1,276 191	18,586 1,275 72
Total revenues and other operating income	63,279	55,020	19,380	19,933
Gains and losses from commodity derivative trading Purchase of electricity, gas and other	5,107	947	481	510
energies Fuel and emission rights Services Salaries and wages	(24,678) (12,644) (6,123) (4,994)	(22,655) (10,132) (5,993) (4,532)	(7,489) (4,538) (2,443) (1,730)	(8,825) (4,027) (2,269) (1,542)
Materials and supplies Capitalization of expenses to the cost of	(1,430)	(1,394)	(576)	(506)
assets and change in own inventories Depreciation and amortization Impairment of property, plant and	64 (10,883)	76 (10,901)	24 (3,623)	24 (3,580)
equipment and intangible assets Impairment of trade and other receivables	(19) (22)	(179) (47)	(3) 1	(89) (2)
Other operating expenses	(1,061)	(871)	(275)	(242)
Income (loss) before other income (expenses) and income taxes	6,596	(661)	(791)	(615)
Interest on debt, net of capitalized interest Interest on provisions Interest income Impairment of financial assets Other financial expenses Other financial income	(4,380) (1,207) 972 (1) (508) 13,199	(3,924) (1,166) 614 (2,254) (478) 33,413	(1,495) (408) 330 (1) (251) (100)	(1,373) (389) 210 (2,257) 15 781
Total other income (expenses)	8,075	26,205	(1,925)	(3,013)
Income before income taxes	14,671	25,544	(2,716)	(3,628)
Income taxes	(351)	944	499	393
Net income	14,320	26,488	(2,217)	(3,235)

* The way of presentation was changed for 2018 year-end. The prior year figures were changed accordingly to provide comparative information on the same basis.

** The accounting with impact on financial results published for I. and II. quarter 2019 was made in the past period. For more information about the adjustments see Note 2.2.3 of the notes to interim consolidated financial statement as of September 30, 2019.

ČEZ, a. s. STATEMENT OF COMPREHENSIVE INCOME FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2019

in CZK Millions

	1-9/2019	1-9/2018	7-9/2019 *	7-9/2018
Net income	14,320	26,488	(2,217)	(3,235)
Change in fair value of cash flow hedges Cash flow hedges reclassified to statement	4,009	(16,515)	(909)	(9,304)
of income	5,486	2,952	1,221	1,232
Change in fair value of debt instruments Deferred tax related to other comprehensive	420	(337)	150	2
income	(1,884)	2,641	(88)	1,533
Net other comprehensive income that may be reclassified to statement of income or
to assets in subsequent periods	8,031	(11,259)	374	(6,537)
Total comprehensive income, net of tax	22,351	15,229	(1,843)	(9,772)

* The accounting with impact on financial results published for I. and II. quarter 2019 was made in the past period. For more information about the adjustments see Note 2.2.3 of the notes to interim consolidated financial statement as of September 30, 2019.

ČEZ, a. s. STATEMENT OF CHANGES IN EQUITY FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2019

In CZK Millions

	Stated capital	Treasury shares	Cash flow hedge reserve	Debt financial instruments	Equity financial instruments and other reserves	Retained earnings	Total equity
December 31, 2017	53,799	(4,077)	(7,794)	294	78	145,207	187,507
Adoption of IFRS 9	-	-	-	-	-	(32)	(32)
January 1, 2018 (restated)	53,799	(4,077)	(7,794)	294	78	145,175	187,475
Net income Other comprehensive income	- -	- -	- (10,986)	- (273)	- -	26,488 -	26,488 (11,259)
Total comprehensive income	-	-	(10,986)	(273)	-	26,488	15,229
Effect of merger Dividends Sale of treasury shares Share options Transfer of exercised and forfeited share options	- - - - -	- - 543 - -	- - - - -	- - - - -	3 - - 25 (36)	35 (17,603) (333) - 36	38 (17,603) 210 25 -
September 30, 2018	53,799	(3,534)	(18,780)	21	70	153,798	185,374
January 1, 2019	53,799	(3,534)	(18,373)	110	117	151,093	183,212
Net income Other comprehensive income	- -	- -	- 7,691	- 340	- -	14,320 -	14,320 8,031
Total comprehensive income	-	-	7,691	340	-	14,320	22,351
Dividends Sale of treasury shares Share options Transfer of exercised and forfeited share options	- - - -	- 649 - -	- - - -	- - - -	- - 23 (24)	(12,806) (400) - 24	(12,806) 249 23 -
September 30, 2019	53,799	(2,885)	(10,682)	450	116	152,231	193,029

ČEZ, a. s. STATEMENT OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2019

In CZK Millions

	1-9/2019	1-9/2018
OPERATING ACTIVITIES:
Income before income taxes	14,671	25,544
Adjustments to reconcile income before income taxes to net cash
provided by operating activities:
Depreciation and amortization	10,883	10,901
Amortization of nuclear fuel	2,949	2,828
(Gains) and losses on non-current asset retirements	(19)	(14)
Foreign exchange rate loss (gain)	306	432
Interest expense, interest income and dividend income	(9,709)	(28,678)
Provisions	(158)	823
Impairment of property, plant and equipment and intangible assets	19	179
Other impairment and other adjustments	6,715	1,373
Changes in assets and liabilities:
Receivables and contract assets	5,212	(13,794)
Materials, supplies and fossil fuel stocks	(361)	(711)
Receivables and payables from derivatives	866	823
Other assets	(5,947)	1,937
Trade payables	(3,642)	22,172
Other liabilities	237	(3,353)
Cash generated from operations	22,022	20,462
Income taxes received (paid)	(15)	329
Interest paid, net of capitalized interest	(4,020)	(3,629)
Interest received	575	628
Dividends received	12,396	5,889
Net cash provided by operating activities	30,958	23,679
INVESTING ACTIVITIES:
Acquisition of subsidiaries and joint-ventures	(2,577)	(1,132)
Proceeds from disposal of subsidiaries and joint-ventures and
original investments repayments including on liquidation	713	156
Additions to non-current assets, including capitalized interest	(5,353)	(5,076)
Proceeds from sale of non-current assets	1,360	2,832
Loans made	(4,075)	(710)
Repayment of loans	2,000	1,250
Change in restricted financial assets	(666)	(492)
Total cash used in investing activities	(8,598)	(3,172)

ČEZ, a. s. STATEMENT OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2019

continued

	1-9/2019	1-9/2018
FINANCING ACTIVITIES:
Proceeds from borrowings Payments of borrowings Lease payments Change in payables/receivables from group cashpooling Dividends paid Sale of treasury shares	124,762 (127,204) (924) (5,761) (12,771) 249	62,943 (64,291) - 721 (17,537) 210
Net cash used in financing activities	(21,649)	(17,954)
Net effect of currency translation and allowances in cash	37	16
Net increase (decrease) in cash and cash equivalents	748	2,569
Cash and cash equivalents at beginning of period	454	1,272
Cash and cash equivalents at end of period	1,202	3,841
Supplementary cash flow information:
Total cash paid for interest	4,172	3,788