ČEZ Reports 60% Drop in Net Profit for Q1 2023, Plans Record Dividend Payout”

Czech utility company ČEZ has announced a significant decline in net profit for the first quarter of 2023 compared to the same period last year. The company’s net profit fell by 60% to CZK 10.8 billion, while operating revenues increased by 23% to CZK 93.4 billion. Despite the decline in profits, ČEZ plans to pay a record-high dividend of CZK 117 per share from last year’s record profit.

The decrease in net profit can be attributed to extraordinary gains in 2022, which amounted to over CZK 10 billion due to the extreme rise and fluctuations in commodity prices following the military invasion of Russia on Ukraine. Additionally, liquidity measures and the record commodity trading profit in the previous year also contributed to the decrease in operating profit, which amounted to CZK 32.5 billion, down by CZK 11.1 billion from Q1 2022.

In 2022, ČEZ achieved a profit of CZK 78.4 billion, and a windfall tax on unexpected profits was paid. The exact amount of the dividend will be decided by the general meeting of shareholders. CEO Daniel Beneš stated that the Q1 results were in line with expectations and reflected a gradual stabilization in energy markets. The proposed dividend of CZK 117 per share represents 80% of the consolidated profit achieved.

As the majority shareholder, the Czech state is expected to receive CZK 100 billion in taxes and dividends from ČEZ this year. The government, led by Prime Minister Petr Fiala, is considering utilizing a portion of this revenue to address high prices, fund highway construction, and increase defense spending.

Despite the decline in profits, ČEZ’s stock has remained stable, with a slight decline of 0.26% on Thursday. This stability indicates investors’ confidence in the company’s future performance. ČEZ continues to invest heavily in renewable energy and expand its presence in the European market, which is expected to generate new revenue streams in the long term.

Article by Prague Forum