Enea S.A. — Earnings Release 2023

Apr 4, 2024

Report Content Current Report No.: 17/2024

Date of Preparation: 3 April 2024

Issuer's Abbreviated Name: ENEA S.A.

Subject: Information on preliminary financial and operating results for2023

Legal Basis: Article 17(1) of the Market Abuse Regulation - insideinformation

Body of the report:

In connection with the adoption, on 3 April 2024, by the ManagementBoard of ENEA S.A. ("Company", "Issuer"), of information on preliminaryfinancial and operating results of the ENEA Group for 2023, the Companyhereby publishes the said preliminary results.

Consolidated financial results of the ENEA Group for 2023:

- Revenue from sales and other income: PLN 48,183 million,

- EBITDA: PLN 6,298 million,

- Loss before tax: PLN -508 million,

- Net loss in the reporting period: PLN -443 million,

- Net loss attributable to shareholders of the parent company: PLN -704million,

- Capital expenditures on property, plant and equipment and intangibleassets: PLN 3,279 million,

- Net debt / EBITDA ratio: 0.85.

EBITDA in the distinct operating areas:

- Mining: PLN 1,326 million,

- Generation: PLN 3,605 million,

- Distribution: PLN 1,822 million,

- Trading: PLN -30 million.

Selected operating highlights:

- Net coal production: 7.1 million tons,

- Total net electricity generation: 21.3 TWh, of which 2.3 TWh from RES,

- Sales of distribution services to end users: 20.0 TWh,

- Sales of electricity and gaseous fuel to retail customers: 22.8 TWh.

On account of the application of settlements with eligible offtakerspursuant to the Act of 7 October 2022 on special solutions to protectelectricity offtakers in 2023 in connection with the situation on theelectricity market and on account of the application of the maximumprice in accordance with the Act of 27 October 2022 on emergencymeasures to reduce electricity prices and support certain consumers in2023, the ENEA Group recognized compensation revenues in the totalamount of PLN 4,146 million in 2023 and PLN 1,136 million in Q4 2023.

ENEA Group companies were obliged to transfer charges to the PriceDifference Fund pursuant to Article 21 of the Act of 27 October 2022 onemergency measures to reduce electricity prices and support certainconsumers in 2023 - as electricity producers and as energy companiesengaged in electricity trading business. The ENEA Group recognized thecost of charges to the Price Difference Fund in the amount of PLN 3,214million for 2023 and in the amount of PLN 1,012 million for Q4 2023.

The EBITDA result generated by the ENEA Group in 2023 was driven largelyby the following factors (compared to 2022):

The improved EBITDA in the Mining Area resulted from an increase inrevenue from sales of coal driven by the higher realized sales price. Atthe same time, a decline was recorded in the coal sales volume alongwith a hike in operating expenses (an increase in the unit mining cost).

In the Generation Area, the higher EBITDA was largely driven by improvedEBITDA in the System Power Plants Segment and the RES Segment. There wasan increase in margins from generation concessions (among other things,the effect of the year-ago base for forward power supply contracts, forwhich the costs required to fulfill the contracts exceeded the expectedbenefits), an increase in revenues from the Capacity Market, an increasein revenues from Regulatory System Services, and an increase in GreenUnit margins (mainly the effect of higher electricity prices, with anincrease in the unit cost of biomass). The Heat Segment saw a decline inEBITDA, which was influenced by, among other things, a decline in theunit margin on heat. In addition, there was an increase in costs due tothe write-off for the Price Difference Fund and fixed costs across theGeneration Area.

In the Distribution Area, the improvement in EBITDA was driven by thehigher margin realized on the concession business, with a simultaneousincrease in operating expenses and a decrease in the result on otheroperating activities.

In the Trading Area, the higher EBITDA result (lower loss) is mainly dueto the use of provisions related to onerous contracts and higherrevaluation of CO2 contracts. At the same time, despite the operation ofthe compensation system, margins in the retail market declined.

Consolidated financial results of the ENEA Group for Q4 2023:

- Revenue from sales and other income: PLN 12,281 million,

- EBITDA: PLN 2,858 million,

- Loss before tax: PLN -1,284 million,

- Net loss in the reporting period: PLN -1,105 million,

- Net loss attributable to shareholders of the parent company: PLN-1,263 million,

- Capital expenditures on property, plant and equipment and intangibleassets: PLN 1,180 million.

- Net debt / EBITDA ratio: 0.85.

EBITDA in the distinct operating areas:

- Mining: PLN 652 million,

- Generation: PLN 1,866 million,

- Distribution: PLN 513 million,

- Trading: PLN 37 million.

Selected operating highlights:

- Net coal production: 2.5 million tons,

- Total net electricity generation: 5.4 TWh, of which 0.6 TWh from RES,

- Sales of distribution services to end users: 5.1 TWh,

- Sales of electricity and gaseous fuel to retail customers: 5.9 TWh.

Standalone financial results of ENEA S.A. for 2023:

- Revenue from sales and other income: PLN 19,502 million,

- EBITDA: PLN -756 million,

- Loss before tax: PLN -1,637 million,

- Net loss in the reporting period: PLN -1,603 million.

The preliminary results take into account the impairment of assets,which the Issuer announced in Current Report No. 15/2024 dated 14 March2024.

Please be advised that the foregoing figures are estimates and as suchare subject to change, and the final results will be presented in theperiodic reports of ENEA S.A. and the ENEA Group for 2023.

The Company clarifies that the term EBITDA is defined as the value ofoperating profit (loss) + depreciation and amortization + impairmentlosses on non-financial non-current assets (values for the reportingperiod). The Net debt / EBITDA ratio is equal to (loans, borrowings andnon-current and current debt securities + non-current and currentfinance lease liabilities + non-current and current financialliabilities measured at fair value - cash and cash equivalents -non-current and current financial assets measured at fair value -non-current and current debt financial assets measured at amortized cost- other short-term investments) / EBITDA LTM. EBITDA LTM means EBITDAfor the last 12 months.