OREANDA-NEWS. On 18 February 2008 the Thermal GenCo Zakhidenergo reported its preliminary net profit for 2007 – USD 1.7mn. The figure is 2.6 times lower than that reported for 2006.

The company has suffered from several negatives in 2007 like reduced export output, coal shortages, coal price hikes and lagging selling price increases but all these factors would not in our view affect the bottom line by that much. Until we see the full results we tend to believe that the fact that the company postponed its bond issue planned for October 2007 might have induced a significant increase in short-term borrowing that led to a dramatically reduced bottom line.