Energa : Information on the results of impairment tests

Date: 7 January 2021

Subject: Information on the results of impairment tests

Legal basis: Article 17 (1) of MAR - inside information

The Management Board of Energa SA (the 'Company') hereby informs that on 7 January 2021 it received the information about the results of impairment tests of Energa Group's (the 'Group') fixed assets and impairment tests on stakes in subsidiaries owned by Energa SA, which were conducted for the second half of 2020 in accordance with IAS 36.

The results of the abovementioned impairment tests revealed an increase in the recoverable value of certain fixed assets (mainly conventional and CHP generation assets) of the Group, thanks to which it was possible to reverse impairment losses on these assets in the total amount of PLN 150 million. At the same time it was found necessary to create the impairment losses on other fixed assets of the Group in the total amount of PLN 18 million.

Moreover, as a result of conducted impairment tests on stakes in subsidiaries owned by Energa SA, the total result on created and reversed impairment losses amounted to PLN -13 million.

The estimated total impact of the above events on the consolidated net result of Energa Group for 2020 is PLN +133 million, and on the standalone net result of Energa SA for 2020 PLN -10 million. The above events are of a non-cash nature. They will impact the net results of Energa Group and Energa SA without affecting the EBITDA result (operating profit before amortization and impairment of fixed assets).

The financial data presented are estimates and are subject to review by the auditor, therefore they may change. The final results of the tests and amounts of reversal of impairment losses will be presented in the consolidated financial statements of Energa Group and in the standalone financial statements of Energa SA for 2020.