OREANDA-NEWS. Kyivenergo (KIEN) increased its net sales by 31.2% y-o-y to $158 mln in 3Q07, this not being enough for KIEN to make a positive gross profit, noted an Alfa Capital Ukraine's analyst. The company posted gross losses of $24 mln, surpassing the figure from 3Q06 by 8.9%. EBITDA was saved by D&A and reached $13.2 mln, which is markedly higher than the negative $3 mln posted the year before. KIEN broke even with a net income of $6.5 mln, whereas it ended 3Q06 with a net loss of $6.2 mln.

According to Alfa Capital experts, KIEN's gross losses were likely due to the suppression of its electricity tariffs by the National Electricity Regulatory Commission (NERC). Another half of KIEN's revenues came from heating power generation and supply to Kyiv and this business has been detrimental for years due to tariff capping by the local authorities. The company was saved from net losses by large other operating income, which came from a significant reduction in KIEN's bad debt provisions during the quarter, the experts concluded.