S.N.T.G.N. Transgaz (TGN) Q2 2024 earnings summary

Executive summary

• Net profit for H1 2024 rose 223% year-over-year to 176.0 million lei, driven by higher regulated tariffs, increased capacity booking revenue, and significant growth in domestic transmission activity.

• Operating revenue before balancing and construction surged 134% year-over-year, with consolidated turnover reaching 1,138.6 million lei, up 18.6%.

• Major cost increases were offset by savings in other operating expenses and lower financial costs.

• Strategic focus on infrastructure modernization, hydrogen integration, and regional interconnectivity.

• The company advanced its decarbonization strategy, secured major EU and government funding, and maintained its monopoly in Romania's gas transmission sector.

Financial highlights

• EBITDA margin improved to 39.97% from 27.68% year-over-year; EBITDA reached 398.5 million lei (+51%).

• Net profit: 176.4 million lei (+249% year-over-year); gross profit: 223 million lei (+138%).

• Turnover: 1,138.6 million lei (+18.6% year-over-year); operating income before balancing and construction: 1,104.7 million lei (+45%).

• Investment costs surged to 689.1 million lei, up 1,543% year-over-year, reflecting accelerated infrastructure development.

• Cash and cash equivalents increased to 1,179 million lei, up 66% from year-end 2023.

Outlook and guidance

• Major investment projects planned for 2024–2033, including BRUA Phase II/III, Black Sea corridor, and hydrogen transmission upgrades.

• Regulated revenue for natural gas transmission set at 2,005 million lei for Oct 2024–Sep 2025.

• The decarbonization strategy and hydrogen infrastructure initiatives are prioritized for implementation in 2024 and beyond.