The profit of the SOE portfolio in the first half of the year is a record 314.8 million earned euros

In the first half of 2023, the net profit earned by state-owned enterprises (SOEs) has more than doubled, up to 314.8 million, compared to the same period last year. euros. Companies in the energy sector contributed the most to the record profit, but other SOE sectors also achieved better results this half-year than last year and operated profitably.

According to Vidas Danielius, director of the Governance Coordination Center, the financial results of the SOE portfolio in the first half of 2023 were extremely successful, despite the ongoing tension in the geopolitical environment and other unfavorable external factors. “Timely restructuring of the management of SOEs and the higher management bar set by the companies themselves lead to ever-improving results. This year, the net profit earned in the first half of the year was the highest during the entire SOE portfolio analysis period, which the Management Coordination Center has been conducting since 2016. We can also celebrate the positive changes that took place during the first half of the year in the implementation of the SOE restructuring and management centralization plan: the optimization of the SOE portfolio was successful, the number of companies with SOE legal status and the number of SOE shareholders decreased,” he emphasized.

In the first half of this year, all SOE sectors worked profitably: companies in the transportation sector earned 36.9 million. euros, when 1.4 million were incurred in the first half of 2022. euro loss; VĮ Valstinių miško urėdija, which represents the forestry sector, increased its net profit by 6.2 percent. up to 62.8 million euros; the net profit of other SOEs not assigned to the main sectors increased one and a half times: from 4.2 million EUR to 19.7 million euros. In the general portfolio of SOEs, the net profit increased the most by companies in the energy sector, whose net profit grew more than twice to 191.5 million. euros and accounted for more than half of the entire SOE portfolio’s earned profit.

According to V. Danieliaus, the main factors that determined the growth of the SOE energy sector’s profit were the significantly increased electricity transmission prices and the successful investment decisions of the innovation fund KŪB “Smart Energy Fund powered by Ignitis Group” of AB “Ignitis grupė”. “It is worth noting that the income of the energy sector decreased by almost a fifth, when the turnover of other SOE sectors grew, but effectively managed operating costs, which decreased faster than income, allowed us to enjoy good results,” he noted.

The sales revenue of the entire portfolio of SOEs – due to the decrease in the turnover of energy companies – shrank by 11.1 percent. up to 2.3 billion euros. The income of the energy companies sector decreased by 18.3 percent. up to 1.6 billion euros, while the income of the transportation companies sector grew by 11.7 percent. up to 414.7 million euros, forestry sector – 10.9 percent. up to 157.9 million, the sector of other SOEs – 12.4 percent. up to 125.7 million euros.

V. Danielius, head of the Governance Coordination Center, emphasized that in the course of continuing the restructuring of SOEs and in order to implement OECD recommendations on improving corporate governance, not only did the number of SOEs decrease from 44 to 38, but also the legal status of companies changed. The number of companies with the legal form of a state enterprise (SOE) decreased from 11 to 7, as well as the share holders of SOEs decreased from 11 to 9.

“The significant structural changes that have taken place in the SOE portfolio this year are the achievements of the ongoing SOE transformation. In this process, it is very important not to stop and continue to improve on the way to transparent, efficient and ambitious management of SOEs”, V. Danielius, director of the Governance Coordination Center, emphasizes.

Accounting value of SVE portfolio assets in the first year of 2023 decreased by 24 percent in the first half of the year. or 3.9 billion EUR to 12.4 billion euros. The main reason for this was the reorganization of the legal form of the Directorate of Roads of Lithuania AB, after which changes were made to the accounting policy related to assets managed by the right of trust, which were transferred to the company for management by the state, and these assets were transferred to off-balance sheet accounts.

in 2023 at the end of June, 27,314 employees worked in 38 SOEs – 1.4 percent. or 367 employees more than at the beginning of the year.

In more detail, get acquainted with the latest 2023 report prepared by the Governance Coordination Center. January-June The report of Lithuanian state enterprises is available on the website https://governance.lt/vkc-ataskaitos/.