CEZ A.S. — Interim / Quarterly Report 2017

Aug 8, 2017

BALANCE SHEET

in CZK Millions in accordance with IFRS as of June 30, 2017

1. 1. 2017 31. 12. 2016 Assets Property, plant and equipment: Plant in service 394,405 394,262 Less accumulated depreciation and impairment (225,916) (218,114) Net plant in service 168,489 176,148 Nuclear fuel, at amortized cost 16,027 14,745 Construction work in progress, net 51,531 50,337 Total property, plant and equipment 236,047 241,230 Other non-current assets: Restricted financial assets 13,408 13,290 Investments and other financial assets, net 179,109 183,885 Intangible assets, net 420 581 Total other non-current assets 192,937 197,756 Total non-current assets 428,984 438,986 Current assets: Cash and cash equivalents 5,974 454 Receivables, net 45,594 44,413 Income tax receivable 899 571 Materials and supplies, net 5,457 5,291 Fossil fuel stocks 342 407 Emission rights 3,216 2,013 Other financial assets, net 27,748 43,013 Other current assets 1,230 1,050 Assets classified as held for sale 736 Total current assets 90,460 97,948 Total assets 519,444 536,934 Equity and liabilities Equity: Stated capital 53,799 53,799 Treasury shares (4,246) (4,246) Retained earnings and other reserves 152,806 151,145 Total equity 202,359 200,698 Non-current liabilities: Long-term debt, net of current portion 120,343 131,960 Provisions 54,844 55,006 Deferred tax liability 10,401 9,003 Other long-term liabilities 5,044 7,019 Total non-current liabilities 190,632 202,988 Current liabilities: Short-term loans 5,224 7,874 Current portion of long-term debt 8,611 3,484 Trade and other payables 105,379 110,410 Income tax payable 1 Provisions 3,316 3,904 Accrued liabilities 3,923 7,575 Total current liabilities 126,453 133,248 Total equity and liabilities 519,444 536,934

STATEMENT OF INCOME

in accordance with IFRS as of June 30, 2017

in CZK Millions

	1-6/2017	1-6/2016	4-6/2017	4-6/2016
Sales of electricity	32,811	33,635	15,071	16,183
Sales of gas, heat and other revenues	4,739	4,123	1,786	1,540
Other operating income	1,726	451	1,355	50
Total revenues and other operating income	39,276	38,209	18,212	17,773
Gains and losses from commodity derivative trading, net	559	796	(929)	(723)
Fuel	(5,515)	(5,113)	(2,448)	(2,227)
Purchased power and related services	(15,622)	(15,511)	(6,512)	(7,464)
Repairs and maintenance	(1,063)	(897)	(651)	(546)
Depreciation and amortization Impairment of property, plant and equipment and	(8,178)	(7,344)	(4,093)	(3,680)
intangible assets		1	-	(1)
Salaries and wages	(2,776)	(2,643)	(1,419)	(1,382)
Materials and supplies	(788)	(663)	(403)	(359)
Emission rights, net	(619)	283	(720)	(80)
Other operating expenses	(2,152)	(3,079)	(1,504)	(1,695)
Income before other income (expenses) and income taxes	3,122	4,039	(467)	(384)
Interest on debt, net of capitalized interest	(1,683)	(1,000)	(833)	(494)
Interest on provisions	(702)	(637)	(351)	(319)
Interest income	338	480	169	235
Foreign exchange rate gains (losses), net	501	(728)	606	(530)
Other financial expenses	(432)	(9,919)	(429)	(10,033)
Other financial income	13,465	25,129	13,038	25,114
Total other income (expenses)	11,487	13,325	12,200	13,973
Income before income taxes	14,609	17,364	11,733	13,589
Income taxes	(246)	(586)	271	82
Net income	14,363	16,778	12,004	13,671

STATEMENT OF COMPREHENSIVE INCOME

in accordance with IFRS as of June 30, 2017

in CZK Millions

	1-6/2017	1-6/2016	4-6/2017	4-6/2016
Net income	14,363	16,778	12,004	13,671
Other comprehensive income - items that may be reclassified subsequently to statement of income or to assets:
Change in fair value of cash flow hedges recognized in equity	3,762	(1,288)	1,975	(2,924)
Cash flow hedges reclassified to income statement Change in fair value of available-for-sale financial	2,737	(266)	2,015	(859)
assets recognized in equity	(430)	10	(27)	(29)
Deferred tax related to other comprehensive income	(1,153)	294	(753)	725
Other comprehensive income, net of tax	4,916	(1,250)	3,210	(3,087)
Total comprehensive income, net of tax	19,279	15,528	15,214	10,584

STATEMENT OF CHANGES IN EQUITY

in accordance with IFRS as of June 30, 2017

in CZK Millions

	Stated Capital	Treasury Shares	Cash flow hedge reserve	Available-for sale and other reserves	Retained Earnings	Total Equity
December 31, 2015	53,799	(4,246)	(121)	925	170,212	220,569
Net income					16,778	16,778
Other comprehensive income			(1,259)	9		(1,250)
Total comprehensive income	-	-	(1,259)	9	16,778	15,528
Dividends					(21,369)	(21,369)
Share options				12		12
Transfer of forfeited share options within equity				(21)	21	-
June 30, 2016	53,799	(4,246)	(1,380)	925	165,642	214,740
December 31, 2016	53,799	(4,246)	(7,536)	926	157,755	200,698
Net income					14,363	14,363
Other comprehensive income			5,264	(348)		4,916
Total comprehensive income	-	-	5,264	(348)	14,363	19,279
Dividends					(17,630)	(17,630)
Share options Transfer of exercised and forfeited share				12		12
options within equity				(15)	15	-
June 30, 2017	53,799	(4,246)	(2,272)	575	154,503	202,359

STATEMENT OF CASH FLOWS

in CZK Millions in accordance with IFRS as of June 30, 2017

	1-6/2017	1-6/2016
Operating activities:
Income before income taxes	14,609	17,364
Adjustments to reconcile income before income taxes to net cash
provided by operating activities:
Depreciation and amortization	8,178	7,344
Amortization of nuclear fuel	1,804	1,870
Gain (loss) on non-current assets retirements, net	(1,158)	(18)
Foreign exchange rate losses (gains), net	(501)	728
Interest expense, interest income and dividends income, net	(12,078)	(14,629)
Provisions	(860)	(1,672)
Impairment of property, plant and equipment and intangible assets		(1)
Other impairment and other adjustments	225	740
Changes in assets and liabilities:
Receivables	12,240	5,036
Materials, supplies and fossil fuel stocks	(106)	48
Receivables and payables from derivatives	(2,284)	583
Other current assets	177	2,680
Trade and other payables	(6,209)	(3,896)
Accrued liabilities	(2,956)	(1,563)
Cash generated from operations	11,081	14,614
Income taxes received (paid)	(330)	(761)
Interest paid, net of capitalized interest	(2,017)	(1,222)
Interest received	371	520
Dividends received	2,261	3,652
Net cash provided by operating activities	11,366	16,803
Investing activities:
Acquisition of subsidiaries, associates and joint-ventures and refunds	(368)
Proceeds from disposal of subsidiaries, associates and joint-ventures
including liquidation distribution received	1,418	9,202
Additions to non-current assets, including capitalized interest	(5,788)	(12,870)
Proceeds from sale of non-current assets	151	32
Loans made	(2,416)	(8,796)
Repayments of loans	1,169	1,068
Change in restricted financial assets	(482)	(494)
Total cash used in investing activities	(6,316)	(11,858)
Financing activities:
Proceeds from borrowings	54,276	23,813
Payments of borrowings	(57,822)	(23,994)
Decreases of other long-term liabilities		(679)
Change in payables/receivables from group cashpooling	4,034	4,573
Dividends paid	(56)	(48)
Net cash used in financing activities	432	3,665
Net effect of currency translation in cash	38	50
Net increase (decrease) in cash and cash equivalents	5,520	8,660
Cash and cash equivalents at beginning of period	454	2,964
Cash and cash equivalents at end of period	5,974	11,624
Supplementary cash flow information
Total cash paid for interest	3,169	3,549