CEZ A.S.

Quarterly Report • Aug 13, 2019

ČEZ, a. s.

SEPARATE FINANCIAL STATEMENTS

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

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

in CZK Millions

	June 30, 2019	December 31, 2018
ASSETS:
Plant in service Less accumulated depreciation and impairment	459,467 (251,913)	454,354 (244,830)
Net plant in service	207,554	209,524
Nuclear fuel, at amortized cost Construction work in progress, net	14,135 7,119	14,331 7,242
Total property, plant and equipment	228,808	231,097
Restricted financial assets, net Other non-current financial assets, net Intangible assets, net	14,207 178,978 4,650	13,336 177,479 4,235
Total other non-current assets	197,835	195,050
Total non-current assets	426,643	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	704 54,007 19 6,954 475 15,975 87,440 2,952 6,540	454 64,287 7 6,526 462 13,157 106,133 2,362 6,540
Total current assets	175,066	199,928
Total assets	601,709	626,075

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

continued

	June 30, 2019	December 31, 2018
EQUITY AND LIABILITIES:
Stated capital Treasury shares Retained earnings and other reserves	53,799 (2,902) 144,437	53,799 (3,534) 132,947
Total equity	195,334	183,212
Long-term debt, net of current portion Provisions Other long-term financial liabilities Deferred tax liability	112,964 64,091 10,453 7,306	133,026 62,971 13,776 4,539
Total non-current liabilities	194,814	214,312
Short-term loans Current portion of long-term debt Trade payables Provisions Other short-term financial liabilities Other short-term liabilities	1,884 24,676 43,060 5,923 135,022 996	11,709 5,590 51,208 6,889 152,544 611
Total current liabilities	211,561	228,551
Total equity and liabilities	601,709	626,075

ČEZ, a. s. STATEMENT OF INCOME FOR THE SIX MONTHS ENDED JUNE 30, 2019

in CZK Millions

	1-6/2019	1-6/2018 *	4-6/2019	4-6/2018 *
Sales of electricity, heat and gas Sales of services and other revenues Other operating income	40,858 2,455 586	32,312 2,275 500	17,399 1,270 339	14,565 1,127 232
Total revenues and other operating income	43,899	35,087	19,008	15,924
Gains and losses from commodity derivative trading Purchase of electricity, gas and other	1,876	437	324	(862)
energies Fuel and emission rights Services Salaries and wages Materials and supplies	(17,189) (8,106) (3,680) (3,264) (854)	(13,830) (6,105) (3,724) (2,990) (888)	(7,091) (3,900) (2,041) (1,705) (397)	(5,866) (3,268) (2,145) (1,541) (441)
Capitalization of expenses to the cost of assets and change in own inventories Depreciation and amortization Impairment of property, plant and equipment	40 (7,260)	52 (7,321)	18 (3,624)	25 (3,615)
and intangible assets Impairment of trade and other receivables Other operating expenses	(16) (23) (786)	(90) (45) (629)	- (13) (486)	(90) (50) (310)
Income (loss) before other income (expenses) and income taxes	4,637	(46)	93	(2,239)
Interest on debt, net of capitalized interest Interest on provisions Interest income Impairment of financial assets Other financial expenses Other financial income	(2,885) (799) 642 - (257) 13,299	(2,551) (777) 404 3 (493) 32,632	(1,457) (399) 322 1 (250) 13,157	(1,299) (388) 203 2 (475) 32,428
Total other income (expenses)	10,000	29,218	11,374	30,471
Income before income taxes	14,637	29,172	11,467	28,232
Income taxes	(327)	551	293	734
Net income	14,310	29,723	11,760	28,966

* 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.

ČEZ, a. s. STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED JUNE 30, 2019

in CZK Millions

	1-6/2019	1-6/2018	4-6/2019	4-6/2018
Net income	14,310	29,723	11,760	28,966
Change in fair value of cash flow hedges Cash flow hedges reclassified to statement	8,308	(7,211)	(683)	(8,022)
of income	4,265	1,720	2,185	205
Change in fair value of debt financial instruments Deferred tax related to other comprehensive income	270	(339)	237	(221)
	(2,440)	1,108	(330)	1,528
Net other comprehensive income that may
be reclassified to statement of income or to assets in subsequent periods	10,403	(4,722)	1,409	(6,510)
Total comprehensive income, net of tax	24,713	25,001	13,169	22,456

ČEZ, a. s. STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED JUNE 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	- -	- -	- (4,448)	- (274)	- -	29,723 -	29,723 (4,722)
Total comprehensive income	-	-	(4,448)	(274)	-	29,723	25,001
Effect of merger Dividends Sale of treasury shares Share options Transfer of exercised and forfeited share options	- - - - -	- - 526 - -	- - - - -	- - - - -	3 - - 17 (29)	35 (17,648) (322) - 29	38 (17,648) 204 17 -
June 30, 2018	53,799	(3,551)	(12,242)	20	69	156,992	195,087
January 1, 2019	53,799	(3,534)	(18,373)	110	117	151,093	183,212
Net income Other comprehensive income	- -	- -	- 10,184	- 219	- -	14,310 -	14,310 10,403
Total comprehensive income	-	-	10,184	219	-	14,310	24,713
Dividends Sale of treasury shares Share options Transfer of exercised and forfeited share options	- - - -	- 632 - -	- - - -	- - - -	- - 15 (15)	(12,850) (388) - 15	(12,850) 244 15 -
June 30, 2019	53,799	(2,902)	(8,189)	329	117	152,180	195,334

ČEZ, a. s. STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30, 2019

In CZK Millions

	1-6/2019	1-6/2018
OPERATING ACTIVITIES:
Income before income taxes	14,637	29,172
Adjustments to reconcile income before income taxes to net cash provided by operating activities:
Depreciation and amortization	7,260	7,321
Amortization of nuclear fuel	2,019	1,934
(Gains) and losses on non-current asset retirements	(11)	(18)
Foreign exchange rate loss (gain)	247	468
Interest expense, interest income and dividend income	(10,909)	(29,843)
Provisions	(1,188)	(1,242)
Impairment of property, plant and equipment and intangible assets	16	90
Other impairment and other adjustments	3,692	1,435
Changes in assets and liabilities:
Receivables and contract assets	8,820	(2,291)
Materials, supplies and fossil fuel stocks	(444)	293
Receivables and payables from derivatives	3,015	418
Other assets	(2,038)	3,172
Trade payables	(7,714)	3,111
Other liabilities	386	(1,804)
Cash generated from operations	17,788	12,216
Income taxes received (paid)	(13)	12
Interest paid, net of capitalized interest	(3,459)	(3,165)
Interest received	373	387
Dividends received	1,186	1,712
Net cash provided by operating activities	15,875	11,162
INVESTING ACTIVITIES:
Acquisition of subsidiaries and joint-ventures Proceeds from disposal of subsidiaries and joint-ventures and	(1,603)	(404)
original investments repayments including on liquidation	709	156
Additions to non-current assets, including capitalized interest	(3,853)	(3,101)
Proceeds from sale of non-current assets	1,353	1,516
Loans made	(3,690)	(211)
Repayment of loans	1,494	705
Change in restricted financial assets	(597)	(443)
Total cash used in investing activities	(6,187)	(1,782)

ČEZ, a. s. STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30, 2019

continued

	1-6/2019	1-6/2018
FINANCING ACTIVITIES:
Proceeds from borrowings Payments of borrowings Lease payments Change in payables/receivables from group cashpooling Dividends paid Sale of treasury shares	42,959 (53,856) (618) 1,856 (39) 244	33,152 (44,702) - 1,726 (44) 204
Net cash used in financing activities	(9,454)	(9,664)
Net effect of currency translation and allowances in cash	16	22
Net increase (decrease) in cash and cash equivalents	250	(262)
Cash and cash equivalents at beginning of period	454	1,272
Cash and cash equivalents at end of period	704	1,010
Supplementary cash flow information:
Total cash paid for interest	3,591	3,314