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Dei – power board, is in a difficult economic position.
Dei is in danger of continuing to operate, is highlighted by Ernst & Young, the independent chartered auditor-accountant in the annual report of the companys financial results. According to the auditor: ‘the short-term requirements of the group of companies fell short by €949 million and by €708 million the long-term requirements, respectively. Based on managements assessment of the above conditions, which are expected to continue during the next twelve months individually and as a whole with other issues, indicate the existence of substantial uncertainty, which may raise significant doubts as to the ability of Dei and the Group to continue their business’.
Two lignite stations that were sold, have also been taken into account, while without them the damage is limited to half a billion euros, i,e. €542 million, from an after-tax profit of €127.6 million in 2017. While in 2014 Dei showed a profit of €90 million.
With the recent balancing of the books, it has been found that there is a total debt in the region of4.7 billion euros. Of that amount €2.4 billion is owed by their customers. An amount of €223.8 million from the auctioning of its power – NOME – while the impact of the increase in CO2 emission rights, that Dei has to buy, increased to €279.5 from €141.6 million. Overdue requirements (excluding settlements) decreased by € 93 million, from € 2,536 to € 2,443 billion.
Two, admittedly, are the main reasons that led to its current situation:
1. The party over all these years with the directed and overpriced assignments of works.
2. The inexplicable tolerance shown by Dei to its bad-payers, which began more than a decade ago, when there were no memorandums and household consumers who were unable to pay their bills, but only large strategic bad-payers. The bad start that began with these large strategic bad-payers slowly began to diffuse downward, and eventually the problem grew to levels that became largely insoluble.
A 3rd reason could be that the Syriza government didn’t go ahead with the sale of the ‘small Dei’ – 30% of its portfolio (units, clientele, losses) and chose to adopt lignite power auctions (NOME) to its private competitors, as well as the sale of lignite plants, at a time when the European environment is not conducive to investment in coal. It is noted that a former Dei chairman said that “if the sale of ‘the small Dei’ proceeded, revenues in the order of 1.5 to 2 billion euros would come into its coffers.
Naming names wont help but to put you in the picture, at the beginning of this year, 2019, siting in the dock at the three-member Court of Appeal for bribery in 2003 with €250,000 was a CEO of Dei. The category is related to the then assignment to a company for the construction of a new plant in Lavrio, which according to the indictment caused Dei a loss of approximately €35 million.
Throughout the years there have been too many overpriced assignments to this company and several of them have been dealt with through the Greek justice system. It is a unique world phenomenon: This company in recent years manufactured electricity-producing units for Dei. as this company delayed, Dei bought electricity to meet the needs of its customers, from the company that was also a power producer. at higher costs (the company is the largest private producer), while Dei, itself, then supplied electricity to another company of the company at a price below cost, which was not even paid. All this “complex” has cost Dei hundreds of millions of euros. Only the power supply to this second company, in recent years, caused Dei damages exceeding €235 million.
