Energa S.A.

Earnings Release • Jan 27, 2022

Current report No. 3/2022

Date: 26 January 2022

Subject: Estimated financial and operational data of the Energa Groupfor Q4 2021 and for 2021

Legal basis: Article 17 (1) of MAR - inside information

The Management Board of Energa SA hereby reports estimated selectedfinancial and operational data of the Energa Group ("Group") for thefourth quarter of 2021 and for 2021.

Selected data for Q4 2021:

Revenues of the Group: PLN 3,780 million (vs. PLN 3 350 million in Q42020).

EBITDA of the Group: PLN 420 million (vs. PLN 482 million in Q4 2020),including:

EBITDA of the Distribution Business Line: PLN 523 million (vs. PLN 438million in Q4 2020),

EBITDA of the Generation Business Line: PLN 48 million (vs. PLN 30million in Q4 2020),

EBITDA of the Sales Business Line: PLN -127 million (vs. PLN 42 millionin Q4 2020).

Operating result (EBIT) of the Group: PLN 127 million (vs. PLN 365million in Q4 2020).

Net profit of the Group: PLN 68 million (vs. PLN 238 million in Q4 2020).

CAPEX of the Group: PLN 772 million (vs. PLN 532 million in Q4 2020).

Distribution of electricity: 5,835 GWh (vs. 5,652 GWh in Q4 2020).

Gross production of electricity: 1,172 GWh (vs. 977 GWh in Q4 2020).

Retail sales of electricity: 4 855 GWh (vs. 4 896 GWh in Q4 2020).

The Energa Group generated EBITDA (operating profit before amortizationand impairment of non-financial non-current assets) of PLN 420 millionin Q4 2021, a decrease of 13% compared to the same period of theprevious year. This result was mainly influenced by:

a) EBITDA achieved by the Distribution Business Line of PLN 523 million(up by PLN 85 million y/y). EBITDA growth was fuelled by a higher marginon sales of distribution services due to solid volumes and loweroperating costs due to a solid valuation of actuarial reserves.

b) EBITDA achieved by the Generation Business Line of PLN 48 million (upby PLN 18 million y/y). The improvement was mainly due to higher salesof electricity and system services for the Transmission System Operator,coupled with lower fixed costs. These drivers were partially offset by ahigher variable cost (mainly cost of use of key production fuels with aparallel significant increase in the cost of purchase of CO2 emissionallowances).

c) EBITDA achieved by the Sales Business Line of PLN -127 million (downby PLN 169 million y/y). The y/y decline in EBITDA and negative EBITDAin the reporting quarter were mostly driven by the situation on theelectricity market in December 2021. Extremely high SPOT and balancingmarket prices for energy were recorded in that period. Furthermore,electricity consumption by customers increased more than usual inrelation to the volume contracted by this Business Line. These factorscontributed considerably to the balancing costs of the energy portfolio.

The Group's net profit in Q4 2021 was PLN 68 million (down by PLN 170million y/y). The lower y/y result was mainly due to lower operatingperformance of the Group and an unfavourable balance of impairmentlosses on property, plant and equipment y/y (a significant reversal wasrecorded in Q4 2020).

Selected data for 2021:

Revenues of the Group: PLN 13,766 million (vs. PLN 12,458 million in2020).

EBITDA of the Group: PLN 2,529 million (vs. PLN 2,038 in 2020),including:

EBITDA of the Distribution Business Line: PLN 2,026 million (vs. PLN1,790 million in 2020),

EBITDA of the Generation Business Line: PLN 211 million (vs. PLN 165million in 2020),

EBITDA of the Sales Business Line: PLN 347 million (vs. PLN 156 millionin 2020).

Operating result (EBIT) of the Group: PLN 1,364 million (vs. PLN 664million in 2020).

Net profit of the Group: PLN 1,031 million (vs. PLN -444 million in2020).

CAPEX of the Group: PLN 2,137 million (vs. PLN 1,721 million in 2020).

Distribution of electricity: 23,029 GWh (vs. 21,763 GWh in 2020).

Gross production of electricity: 4,136 GWh (vs. 3,184 GWh in 2020).

Retail sales of electricity: 18,578 GWh (vs. 18,782 GWh in 2020).

In 2021, the Energa Group generated EBITDA of PLN 2,529 million, a 24%increase compared to 2020. The main contributors to this improvementwere the Distribution Business Line (EBITDA growth by PLN 236 milliony/y), mostly as a result of a higher distribution margin (due to anincreased distribution volume) and lower operating expenses, as well asthe Sales Business Line (EBITDA growth by PLN 191 million y/y), due toimproved margins on electricity sales to end customers relative to theprevious year (an increase in electricity sales margin by as much as PLN283 million y/y). EBITDA of the Generation Business Line was also higher(by PLN 46 million y/y). The EBITDA growth of this Line was mainly dueto higher sales of electricity and higher revenue from system services,however the positive effect of these drivers was partially offset by ahigher cost of use of key production fuels and higher cost of purchaseof CO2 emission allowances.

The data presented are estimates and are subject to review by theauditor, therefore they may change. The data for 2020 has been restated.The final financial and operational data of the Energa Group for Q4 2021and for 2021 will be presented in the consolidated financial statementsof Energa Group for 2021.