Hidroelectrica posted a net profit of RON 90 mn during the last two months of 2012. The current budget for 2013 envisages a pre-tax profit of RON 440 mn, based on a power production of 13 TWh. We consider these figures as rather conservative.
According to the same sources, since Hidroelectrica entered insolvency, its cost base has been reduced by RON 420 mn. For 2013 the budget for maintenance works has been set at RON 220 mn, compared to RON 410 mn in 2012. Through lay-offs and cuts of salaries, the company is aiming to reduce its 2013 salaries costs by RON 90 mn compared to 2012. We view this piece of news as rather positive for Fondul Proprietatea’s shares.