Plinara to lose €92 million in revenue due to HERE

On Friday, Zagreb Holding announced that if Gradska plinara no longer supplies gas to Zagreb citizens from October 1, its sales revenue will decrease by 92 million euros and EBITDA will decrease by 1 million euros, but the holding will continue to support Zagreb citizens by operating and supplying gas on a market basis according to the new lower supply volumes.

Zagrebki Holding reported on Friday that the Croatian Energy Regulatory Authority (HERA) launched a public tender procedure for supplier selection and public gas supply service obligations in 27 distribution areas under the Gas Market Law. The period is from October 1, 2024 to September 30, 2027. They also said that the company in question, Gradska plinara Zagreb – Opskrba doo, applied for the tender for gas supply in the Gradska plinara Zagreb distribution area, which has 290,753 metering points.

They stated that on May 29, HERA made a decision on the selection of suppliers for public service obligations by distribution area, in which Meðimurje-plin was selected as the distribution area for Zagreb city gas plant, while the offer of Zagreb city gas plant was not accepted.

“The company’s management will consider the above solutions and decide on further legal steps to protect its rights,” Zagreb Holding said.

Last year, Gradska plinara had revenues of 311 million euros

Meanwhile, in 2023, Gradska plinara achieved operating revenues of 311 million euros, of which 284 million euros were related to public services, and earnings before interest, depreciation, amortization and taxes (EBITDA) of 2 million euros, of which 1.7 million euros were related to public services.

In 2024, the company plans to have operating revenue of 363 million euros, of which 342 million euros will be used for public services, and earnings before interest, depreciation, amortization and taxes (EBITDA) of 800,000 euros, of which 600,000 euros will be used for public services.

If HERA’s above-mentioned solution is not implemented from October 1, the company’s planned revenue from the sale will be reduced by EUR 92 million, while earnings before interest, amortization, depreciation and tax (EBITDA) will be reduced by EUR 1 million. Until the company resumes the supply of gas for public service obligations after September 30, 2024, Zagrebački Holding as the parent company will continue to support the company’s operations and gas supply on a market basis in accordance with the new lower supply volume.

According to an announcement released by the Zagreb Stock Exchange, Zagreb Holding believes that the above situation will not affect its ability to fulfill its obligations to bondholders and other creditors.