Alexela Group posts 41.3 percent revenue loss in 2020, still turns profit
Energy Group Alexela Grupp has reported an over-forty-percent fall in revenue on year to 2020, the first full year of the pandemic, though it still turned a profit of nearly €12 million. The group's fuel retailer subsidiary, Alexela AS, also reported profits.
The company obtained a €37-million loan from the state last year, applied for in May and granted in October, which it said it needed to mitigate the worst of the effects of the pandemic.
Alexela Group's revenue fell 41.3 percent in 2020, to €197.6 million, though the group still made a profit of €11.8 million, compared with a loss of €7.7 million the previous year.
Group CEO Andreas Laane said that: "Financially, we can say that we were able to adapt successfully to the COVID-19 crisis".
"While we were forced to significantly reduce the number of employees, we were able to avoid the closure of our factories, production and trade," he added, according to BNS.
"However, typical of a crisis, not all consolidated indicators of the financial year can be considered too positive, but we can be satisfied with the earnings before interest, taxes, depreciation, and amortization (EBITDA) in light of a long coronavirus year," he continued.
One of the group's subsidiaries, Kiviõli Keemiatööstus (KKT) refines oil shale in eastern Estonia, a sector under fire as Estonia moves towards meeting the EU's climate goals.
The group says it is working towards renovating its plant accordingly, with €5.7 million invested in KKT in 2020, a five-year high.
Laane said that: "For example, gas generators are currently being overhauled in Keemiatoostus, the construction of a new ash removal system near the generator building has begun. We are also planning to build a solar park on the territory of Kivioli Keemiatoostus".
Alexela Group 2020 results quick facts
- EBITDA fell 3.8 percent, or €400,000 to €9.9 million.
- Trailer subsidiary Tiki saw a drop as the pandemic arrived, followed by an increase as people, presumably the more well-heeled, starting using trailers to move their boats, ATVs and other equipment from the towns to the countryside, where many holed up during the worst of the lock-down. Ultimately 2020 was a record year for production for Tiki.
- Alexela Group subsidiary Kohela, which makes storage tanks, added major Finnish firm Wartsila to its list of customers.
Looking to the future, the group says a priority is to start cooperating with Viru Keemia Grupp (VKG), another oil shale firm, to develop a waste utilization device based on the solid heat carrier technology used by KKT, which can be used to recycle tire, plastic and oil waste generated in Estonia.
Alexela AS makes profit for 2020
The fuel aspect of the group, Alexela Varahalduse AS reported a 2020 profit of €3.4 million, compared with a loss of €1.6 million for 2019.
Sales revenue rose by 0.9 percent €250 million, over the same period, while operating profit increased from €1.6 million in 2019, to €6.6 million last year, Alexela says. The company invested a total of approximately €4.9 million euros in filling stations and related infrastructures.
Alexela manager Aivo Adamson said of the results that: "While the initial expectations according to the emergency situation established by the government in March 2020 were ominous, prompting us to optimize the composition of the company during the initial stage of adjustment to the crisis situation and suspended investments, in the end everything turned out quite the reverse of that".
In October last year, Alexela Varahalduse AS was granted aid to the tune of €37 million, as a loan, by state credit agency KredEx .
The loan had been requested earlier on in the crisis as the firm claimed it had been hit hard by the pandemic, and also low fuel prices at the time, but in practice the loan mainly shored up jobs at KKT (see above).
While early 2020 in particular saw low world oil prices, twinned with a slashing of excise duties on diesel in the summer leading to that fuel type seeing prices at pump dip below the one-euro-per-liter mark, since the beginning of this year, fuel prices have continued to creep up, nearly reaching all-time records.
The use of KredEx came under increased scrutiny in the first few months of the crisis, and it was a corruption scandal linked between it and a real estate development in Tallinn which prompted the resignation of Jüri Ratas as prime minister, when 2021 was barely two weeks old.
The company says it will continue to focus on developing compressed natural gas (CNG ) and liquefied natural gas (LNG) filling stations in the next year, and also continue to develop self-service convenience stores. At present it has 35 stores nationwide.
AS Alexela's portfolio includes electricity, natural gas, cylinder gas, tank gas and, through 104 filling stations located nationwide, motor fuel.
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Editor: Andrew Whyte