Minister Vlcek dismisses nationalisation of CEZ as costly nonsense

Prague, June 24 (CTK) - Industry and Trade Minister Lukas Vlcek considers the full nationalisation of energy group CEZ to be economic nonsense as it would cost hundreds of billions of Czech crowns that could instead be used to modernise the energy sector, he told CTK.

The opposition ANO movement, for example, would like to see CEZ restructured after the October parliamentary elections. According to ANO chairman Andrej Babis, the proposal should be part of ANO's election programme. The state should fully control the company also according to ANO deputy chairman Karel Havlicek, who claims the current shareholder structure of the company complicates further development in the energy sector.

CEZ is one of the largest energy companies in the Czech Republic. Its majority shareholder is the state, which holds roughly 70 percent of the shares through the Finance Ministry, while the rest is held by private shareholders.

According to Vlcek, financing the nationalisation of the energy group would be problematic. "Either it would have to be financed from the state budget, that is at the expense of higher debt, or at the expense of not having resources for something else. Or there is the second option, namely that it would be financed from CEZ dividends. However, CEZ has a robust investment plan, which is important for the Czech energy sector," Vlcek said.

CEZ's general meeting on Monday decided to pay its shareholders a dividend from last year's adjusted profit of Kc47 per share. In total, Kc25.3bn will be distributed among shareholders, with the state as the majority shareholder receiving over Kc17.6bn.

The CEZ group posted a net profit of Kc30.5bn last year, up by almost 3 percent year-on-year. Earnings before interest, taxes, depreciation and amortisation (EBITDA) also increased, while the company's profit adjusted for extraordinary effects, which is crucial for the dividend, decreased year-on-year. It amounted to Kc31.8bn last year, down Kc3bn year-on-year.

Czech parliamentary elections will be held on October 3 and 4.

hel/er