1 Accounting and valuation principles
The consolidated semi-annual financial statements presented here comprise the unaudited semi-annual financial statements for the six months to 30 June 2020. This interim report has been prepared in accordance with Swiss GAAP FER 31 Complementary Recommendation for Listed Companies in abridged form, and should therefore be read in conjunction with the consolidated financial statements for the year to 31 December 2019.
In individual cases roundings can mean that figures in this report do not add up to the exact total specified, and that the specified percentages do not exactly result from the stated figures.
The dividend payment for the 2019 financial year was approved by the annual general meeting on 20 May 2020.
The following exchange rates were used as a basis for converting the figures in the income statement and balance sheet into CHF:
2 Segment reporting
Net sales from goods and services also include gains and losses (realised and unrealised) on trading transactions. Depending on the party and the business in question, revenues are stated under other items. The above representation by segment does not constitute a full picture of trading activities.
3 Comments on the consolidated financial statements
Changes in consolidations
On 30 January 2020 Repower and additional partners established EVUlution AG with the goal of developing and marketing innovative products and services for energy utilities. The investment is initially recognised at CHF 428 thousand. Repower holds 42.75% of the company, recognising it as an associate according to the share of equity.
In the first half of 2020 Repower Renewable acquired another 12 photovoltaic installations with total installed capacity of 14 MW by establishing SOLIS S.R.L. (on 6 March 2020), which in its turn bought ENERGEIA CODROIPO S.R.L and ENERGEIA VARMO S.R.L. (on 30 April 2020) and ENERGIA TRE S.R.L. (on 18 June 2020) and their existing installations in Italy.
The table below summarises the material recognised amounts of assets acquired and liabilities assumed as well as the purchase prices of the three companies:
The balances presented include estimates whose influencing factors may not have been known at the date of acquisition. This acquisition was recognised for the first time at the end of the half-year period on the basis of provisional figures. If new information emerges on the facts and circumstances that pertained at the time of acquisition, this may lead to adjustments to the provisional figures and the recognition of additional assets and liabilities within the valuation period.
Material events and business transactions
On 1 January 2020 the Prättigau power generation assets, together with Repower AG concessions, were transferred to Repartner Produktions AG. In connection with this transaction the minority shareholders of Repartner Produktions AG transferred their shareholder loan of CHF 49,176 thousand to Repower AG. This transfer is seen as a down payment received for energy deliveries, recognised under other non-current and current liabilities. The advance payment will be charged to profit or loss on a linear basis over the remaining 66-year concession period via net sales from goods and services in the Market Switzerland segment. Income of CHF 373 thousand was recognised in the first half year.
The Swiss Federal Electricity Commission (ElCom) has issued a ruling on the resubmission of the operating costs and cost of capital for the 150 kV Robbia-Campocologno feeder line for the tariff years from 2009 to 2012. In the first half of 2020 Repower received CHF 7,343 thousand in subsequently declared eligible grid costs, including interest on the differences, which are recognised in net sales from goods and services in the Market Switzerland segment.
In the first half of 2019 Repower received reimbursement of CHF 6,425 thousand from its business interruption insurance for downtime at the Teverola plant during 2018; this figure is disclosed under other operating income.
The negative results of associates and joint ventures in the first six months of 2020 were due in particular to start-up losses at EVUlution AG.
Provisions of CHF 7,508 thousand were made in the first half of 2020 for identifiable losses on procurement contracts via guarantees of origin and gas transport capacity. Expenses resulting from the creation of provisions of CHF 4,404 thousand for onerous procurement contracts via guarantees of origin in the Market Switzerland segment, and the creation of provisions of CHF 3,104 thousand for an onerous procurement contract via gas transport capacity in the Market Italy segment are recognised under energy procurement.
Owing to higher overdue receivables during the coronavirus pandemic, there was an increase in impairments on receivables from goods and services from CHF 12,239 thousand at the end of the prior year to CHF 15,654 thousand. The impairments on receivables recognised under other expenses come to CHF 4,191 thousand (versus CHF 1,545 thousand in the prior-year period) and relate primarily to the Market Italy segment.
The investment of CHF 2,813 thousand in tiko Energy Solutions AG at 31 December 2019 was fully impaired in the first half of 2020 via financial expenses. In the same period of the previous year, losses netted with investments and loan receivables to the company to the amount of CHF 6,481 thousand could be released via financial income.
The increase in income taxes versus the prior-year period is primarily the result of this year’s higher earnings from Italy and the use of tax loss carryforwards in the prior year which have now been used up through offsetting.
In 2020 the interest rate swaps recognised under financial liabilities the prior year were released through payment of CHF 14,091 thousand. The cash outflow is included in the Repayment of financial liabilities item in the consolidated cash flow statement.
4 Events occurring after the balance sheet date
In July 2020 the board of directors of Repower AG appointed Lorenzo Trezzini as the company’s new CFO.
The consolidated interim financial statements were approved by the board of directors on 13 August 2020.