CEZ, a. s.

Reported operating revenue was 5% lower year over year. EBITDA declined 20% to 59 billion Czech crowns, with generation and mining down 31% to 14.5 billion and coal EBITDA down 65% to 1.4 billion. Net income increased 10% from 16.5 billion to 18.1 billion Czech crowns. Operating cash flow was 26 billion higher, up 55%, CapEx was 30% higher, and net debt was about 9% higher, nearing 200 billion Czech crowns. For the full year, CEZ raised EBITDA guidance to 109 to 114 billion Czech crowns and adjusted net income guidance to 31 to 35 billion Czech crowns. Assumptions included Czech power generation of 45 to 47 TWh, achieved prices of 106 to 110 per MWh, and carbon credit costs of 77 to 79 euros per ton.

Martin Novak framed the quarter around weak power prices but emphasized that the business is still benefiting from favorable market conditions in parts of generation and from stronger nuclear output. He said the company is moving forward with CEZ Energy as a structural simplification step, with legal work to be completed by the end of Q1 2027 and some transfers likely in 2026. His tone on policy risk was dismissive; he said he does not believe windfall taxes are on the table and that such a move would complicate the CEZ Energy separation.

Novak highlighted that EBITDA was down 20% to 59 billion Czech crowns, while net income rose to 18.1 billion Czech crowns because income tax dropped from 23.1 billion to 5.5 billion Czech crowns after windfall profit tax ended. He pointed to operating cash flow of 26 billion higher and CapEx up 30%, with net debt approaching 200 billion Czech crowns. He also explained the full-year uplift: higher distribution EBITDA, higher power prices due to Middle East tensions, and higher-than-expected nuclear generation offset by weaker commodity trading and delayed projects.

Analysts focused on trading, windfall tax risk, distribution upside, debt and capital structure for CEZ Energy, drought-related nuclear risk, and the impact of delayed energy services projects. Management said the trading weakness was mostly an intra-year revaluation effect, but base trading was also slower and should recover to normal levels. On windfall taxes, Novak said CEZ has heard no serious discussion of reintroducing them and thinks they are effectively off the table; on CEZ Energy, management said details on debt transfer, rating targets, and perimeter are still under analysis. They also said the nuclear fleet uses cooling towers and is not materially constrained by river-water drought conditions.