Dear Sirs and Madams,
As a new Management Board of Enea, we commenced our mission having in mind that our goal is enhancing the Group’s competitiveness and guaranteeing its balanced and long-term development. We wish to manage the company effectively, consistently building its position and value on the market.
Our investments are implemented to improve the reliability and security of energy supply, based on the Polish fuel. We will increase the Group’s operating effectiveness via building optimum synergies. Of a special importance for us is improvement of the quality of our services and innovativeness. We intend to realise that all as a socially responsible business which is open to the needs of all the stakeholders, including Employees.
Effective management of development. Consistent building of the Group’s position and value on the market.
Our fundamental duty is further development and strengthening of Enea Group’s position on the Polish electricity and fuel market. Currently, we are implementing an investment plan resulting from the strategy being in force. Taking over the majority interest in LW Bogdanka by the Group in
October 2015 resulted in the fact that we supplemented our chain of values with the segment of mining. Apart from short-term activities in order to establish appropriate operating synergies, resulting from that fact, we commenced works over the strategy verification to include this element in our development programmes and investments on a short and long run.
Many changes are occurring to our company’s immediate and farther environment. They also relate to national and EU regulations which have a direct impact on the sector in which the Group operates. We should be very well prepared to these changes, therefore at the verification of the strategy we set such a goal to us. We wish to orientate on the building and development of a strong innovative raw materials and energy group, having a financial potential to realise the development and innovation programmes.
Reliability and security of energy supplies based on local fuel. Investments in new sources, modernisation of the existing ones and in infrastructure.
The Group invests in the modernisation and development of generation capacities. In 2015 it spent PLN 1.95 billion for that purpose, of which almost PLN 1.4 billion was expenditures for the implementation of the key investment - a modern 1,075 MWe gross unit in Kozienice Power Plant. It is an extremely important project for the Group and for the whole power infrastructure in Poland. The construction’s progress is 80%. Currently, the final stage of assembly works in the pressure part of the boiler is in progress. We are ahead of the unit’s start-up, acceptance tests and in the end commissioning of the unit.
However, we invest not only in conventional energy sources. We are considering a further development within cogeneration and intend to increase energy production from wind. We are continuing the construction of 14.1 MW Baczyna wind farm and the project of max. 10 MW extension of Bardy wind farm. We are constantly analysing the market as regards potential acquisitions which will be business-effective and will become a part of the Polish energy policy.
Additionally, investments in the maintenance, modernisation and development of the distribution network are very important for the Group. That allows us to provide our Customers with energy of better quality parameters. In 2015 PLN 0.9 billion was allocated to this purpose. During the following years the outlays will range from PLN 0.81 billion to PLN 1 billion.
Increasing operational efficiency. Building optimum synergies within the business operations.
In October 2015 Enea Group became the owner of a total of 66% of LW Bogdanka’s shares. The mine from Lublin is the best producer of bituminous coal in Poland, outstanding in the sector as regards the financial results generated, efficiency of bituminous coal mining and investment plans providing for the availability of new resources. Enea obtained profitable assets which are to guarantee a competitive and predictable fuel price within the Group and long-term reliability of supplies, and additional income from sales beyond the Group.
For Bogdanka it means strengthening of its position in a more and more difficult market environment.
Due to the transaction we have a possibility of implementing a range of synergies, both on the operating level (optimisation of: transaction costs, maintenance management, support functions, and joint purchases), and on the investment level. In next months we will concentrate on the preparation of the integration of both enterprises and identification of long-term initiatives of increasing the value so that the synergies with LW Bogdanka are used possibly in the best way. We wish to prove that it is possible to build a modern and efficient raw materials and energy group and relevant cooperation (business model) of energy and mining sectors may have a deep economic sense and may build corporate value for the company’s Shareholders.
In the other business areas of our chain of values, i.e. generation, trade, trading in energy and fuels, we will also work on the cost and organisational effectiveness so that to establish synergies and the required financial and organisational potential for the planned development programmes.
Customer in the centre of attention. Better quality of services and market offer.
The demand for electricity in Poland should increase. If we compare the level of electricity consumption per citizen, then we are far behind Germany, France or Great Britain. Therefore we intend to further focus on good Customer service and high quality of the market offer, adjusted to Customer needs. We will intend to strengthen our position on the market using the most optimal organisation and product solutions. We will wish to take care for the satisfaction and loyalty of our Customers offering them diversified and price-attractive product connecting the sales of electricity with packages of additional benefits. Yet, in the area of wholesale trade we will be an important player on the market of energy and fuels, we also consider increasing the activity beyond the domestic market.
Investments in innovations and new technologies.
Our activity in the area of innovations and supporting new technologies will become a part of the domestic economy development programme. Research and development projects have a potential of solving problems which are significant for the power sector, however they need engagement of considerable funds and time, with no guarantee of achieving a commercial success. Changing market conditions and legal environment have impact on the development of technologies. In the area of energy sales we will search for new products and services increasing Customer commitment in the conscious use of electricity. Solutions in the field of smart grids have a great potential in the area of distribution and an important direction within generation will surely be the so called clean coal technologies. We intend to participate in the prepared sectoral programme for the power engineering of the National Centre for Research and Development.
Corporate Social Responsibility. Dialogue with the Community Side.
We are a responsible company and we will still act for the benefit of our environment and surroundings. One of the important elements of an efficient Group development management is relevant communication with its key Stakeholders and building trust to the company and its operations. Enea Foundation’s operations within the community involvement and projects resulting from the strategy of the Group’s sustainable development serve that goal. One of our priorities is an open dialogue with local communities and local governments and public institutions representing them. We also intend to continue the dialogue with the Community Side. Human capital is the greatest value of our company and we want to have an open and substantive dialogue.
Yours sincerely,
Mirosław Kowalik
President of the Management Board of Enea SA