Correction: Regarding UAB Ignitis grupė consolidated annual report for 2019, consolidated and separate financial statements and profit (loss) distribution project

Ignitis Grupė, UAB, company code 301844044, registered office at Žvejų str. 14, Vilnius, Republic of Lithuania (hereinafter – the Company or Ignitis Group). The total nominal value of issued bonds 600 000 000 EUR; ISIN codes –XS1646530565; XS1853999313.

*The correction includes the updated Company's Consolidated Annual Report  and financial statements for the year 2018. From 2019 after changing the application of accounting policy principles and applying them retrospectively, the 2018 financial statements have been prepared in accordance with same accounting policies. This set of financial statements is for a special purpose - for debt or capital market transactions, for comparability in all audited periods.*

*The audited Consolidated and Company‘s finanscial statements for the year **2018 that were published on **May **2 2019 (**link**) and approved by The Ministry of Finance of the Republic of Lithuania on **April **30 2019 are not canceled. **Therefore, the updated reports were not re-approved by the General Meeting of Shareholders of the Company. Information on the adjustments made is also provided in the 2019 financial statements approved by the Ordinary General Meeting of Shareholders. *

The Company informs that the Board approved the Consolidated Annual Report for the year 2019 and approved the audited Consolidated and Company’s financial statements for the year 2019, prepared according to the International Financial Reporting Standards and audited by the audit company UAB Ernst & Young Baltic, and the draft of profit (loss) allocation for the year 2019 (see attached documents). The Company submits these documents to the Supervisory Board and to the Ordinary General Meeting of Shareholders of the Company.

*Audited key financial indicators of Ignitis Group for 2019:*

· The Group’s revenue amounted to EUR 1,090.6 million, which is 1.9% more if compared to EUR 1,070.1 million during 2018;
· Operating expenses amounted to EUR 1,007.8 million, which is 7.6% (or EUR 82.6 million) less, compared to EUR 1,190.5.1 million during 2018;
· The Group‘s EBITDA increased by 42.3% and totaled EUR 206.8 million. The Group’s adjusted EBITDA increased by 17.3% and totaled EUR 259.6 million, compared to EUR 221.3 million during 2018. EBITDA ratio grew in all segments. Main reasons of this change were increased number of new customers connected to the distribution network, more orders for power increases and continuous investments to distribution network as well as expanded portfolio of wind parks.
· The Group‘s net profit increased by 368.4% to EUR 59.0 million (EUR -22 million in 2018). The Group’s adjusted net profit amounted to EUR 106.0 million, which is 7.1% more compared to EUR 99.0 million during 2018;
· The level of the return on equity ratio was equal to 4.4% compared to -1.7% in 2018. The level of the adjusted return on equity ratio was equal to 8.0% compared to 7.5% in 2018;
· Investments increased to EUR 455.7 million, which is 6.1% more compared to EUR 429.3 million during 2018. Investments were mainly allocated for investments in cogeneration plants’ projects in Vilnius and Kaunas (47.7%), development of the electricity distribution network (18.3%) and development of gas distribution network (10.3%).

Compared to interim financial indicators for Q1-Q4 2020, published on 28 February 2020, all indicators, changed slightly after the audit and revision of data.

For the sake of comparability, alternative performance measures of 2018 have been restated in accordance with the 2019 adjustment principles applied in financial statements. They are disclosed with the adjustments proposed by the management.

In the project of profit (loss) distribution for 2019, it is proposed that the share of the Company's profit for the payment of dividends for the year 2019 will be EUR 28 million. The proposal was made considering the actual edition of the 14 January 1997 Resolution No. 20 of the Government of the Republic of Lithuania “Concerning Dividends for Shares of State-Owned Companies and Profit Contributions by State Enterprises”.

The Group‘s EBITDA and net profit results are adjusted by (1) eliminating temporary regulatory differences effect (2) eliminating temporary fluctuations in fair value of derivatives (3) restating cash effect of new connections and upgrades (4) eliminating significant impact of one-off factors.

*Regarding the impact of COVID-19 pandemic*

Group's management assessed the potential disruptions of cash flow, supply of services or goods, the attraction of sources of financing, the potential reduction in electricity and gas consumption due to economic slowdown, the risk of COVID-19 infection of critical function personnel and the risk of delays in ongoing projects, using all the information available at the time on the risks posed by COVID-19.

It should be noted that the final impact of the COVID-19 pandemic on the business of the Group companies cannot yet be assessed, however, the Group's management did not identify any threats to the Group's business continuity when assessing the potential impact of key COVID-19 factors on the Group's results. Group companies have taken actions to manage the arising risks.

The Group has a COVID-19 situation management team that constantly monitors the situation and analyzes the latest information, as well as changes in external factors and their impact on the Group and makes additional decisions to ensure the health and safety of employees, customers, suppliers, visitors of the Group companies and business continuity. Customer service centers are closed during quarantine and customers are served remotely. During the quarantine, customers were given the opportunity to pay for utilities in the Ignitis self-service system free of charge. The employees of the Group, who can perform their functions remotely, work from home, others are provided with additional personal protection and personal hygiene measures, unnecessary contacts with other persons are restricted. The Group companies have developed and are implementing actions to ensure the rotation of employees and business continuity in order to ensure, first of all, the health and safety of employees, the continuity of electricity generation, ensuring the stability of the energy system, electricity and gas distribution and supply activities.

More information: Artūras Ketlerius, Head of Public Relations, arturas.ketlerius@ignitis.lt, +370 620 76076

*Attachments*

· GRP annual report
· Draft of profit (loss) distribution 2019
· 2018 CONSOLIDATED AND THE COMPANY'S