"Bulgargaz" has filed a new claim against "TEC Varna" EAD, this time for over BGN 3 million. The state company "Bulgargaz" has filed a lawsuit in the Varna District Court against the company "TEC Varna" EAD, majority owned by the honorary leader of the DPS Ahmed Dogan, in the amount of over BGN 3 million. The amount has been accumulated from unpaid obligations for the supply of natural gas gas for the period from March to September this year, as well as penalties for late payments. "Bulgargaz" has ensured the annual transmission capacity of 7,800 thousand MWh/day requested by "TEC Varna" EAD. In the specific case, the claims of the state-owned company are for the provided natural gas for the eight months of 2022. During that time, the Varna TPP did not use the provided capacity, but regardless of this, it owes remuneration for it, regardless of the reasons why the gas was not has been utilized. "Varna" TPP has transferred shares and shares of subsidiaries to "Sigda". It is about 50 thousand available registered shares of the company "Delta Epsilon", 100 company shares with a nominal value of BGN 10 each from "Port Logistics Burgas" and "Otmanli Village", 6,379,820 shares from the capital of "Pristanishte TEC Ezerovo" and 10,000 ordinary available registered shares worth BGN 100,000 from the capital of Electric Securities. In the middle of May this year however, the Registry Agency refused to register the transfer of assets. For many years, the Varna TPP was among the sites that the state used for functions such as "cold reserve" and electricity production to balance the energy system. The company "Sigda" OOD, majority owned by the honorary leader of DPS Ahmed Dogan, has transferred its shares from "TPP Varna" to the company "Sigda Investment" AD. The transfer took place by decision of the General Meeting of shareholders in "Sigda", held on December 15 of this year. The actual transfer of the shares was reflected in the registers three days later - on December 18. The subject of the transfer are 850,550 ordinary registered shares, each with a nominal value of BGN 10. Majority owner of the capital of "Sigda" OOD with 70% of it is Ahmed Dogan. The remaining shares are divided between Stanislav and Ivelina Papazovi - son and daughter of the former minister of transport in the government of Plamen Oresharski Danail Papazov. Shareholders in "Sigda Investment" are Ahmed Dogan and Danail Papazov, and in addition to the two of them, Stanislav Papazov is on the Board of Directors of the company.
Source: Dnevnik (03.01.2024)

"Bulgargaz" offers 6% cheaper natural gas than February Bulgargaz offers a lower price of natural gas since February. The blue fuel is to fall by 6% from the next month, the state -owned company's application envisages. If there are no sudden changes in the gas markets and the proposal is approved by the regulator, the price will be reduced to 73 BGN per megawatt hour without VAT. This will be the second decline in recent months, after the decrease was just over 11%in January. The next month, the price of Bulgargaz includes the quantities under the long -term contract with Azerbaijan and purchased through tenders liquefied natural gas. It is also envisaged to use quantities of the Cyren gas storage facility. The company announces that at this stage there is no agreed schedule for 2024 for the extraction and renewal of natural gas in Chiren. The Bulgargaz calculations, which envisage the fall of 6%, are on the 10th of this month and usually change until the date (February 1) when the company will submit its final proposal and the Energy and Water Regulation Commission will approve them (EWRC). Now to the other factors that influence the prices, will be added the exacerbation of the conflict in the Red Sea region, as since the end of last year, some of the liquefied natural gas tankers have begun to avoid this route. According to analysts, this will also slow down the cost of deliveries.
Source: 24 chasa (15.01.2024)

Former director of BEH and "Bulgargaz" takes over the new nuclear facilities The state company "NPP "Kozloduy" - New capacities", which is under the umbrella of the nuclear power plant, has a new management. The management board has been completely replaced and the director Valentin Iliev and members Georgi Kirkov, who was the head of Kozloduy NPP and is now on its board, and Ivaylo Ivanov have been released. The new executive director of the company, which will carry out the project to expand the plant with up to two reactors, is Petyo Ivanov. In the past, he held management positions in a number of energy companies, including heading "Bulgarian Energy Holding" (BEH) and "Bulgargaz". While combining the two posts in 2019, the anti-corruption commission found him in a conflict of interest because, as the head of the holding, Iliev had voted for himself in the appointment at Bulgargaz and had determined his remuneration. Among the other new additions to the board of Kozloduy NPP - New Powers is Alex Nestor, former executive director of the American Chamber of Commerce in Bulgaria. Until 2014, he was the executive director of the Canadian "Dundee Precious Metals" in Bulgaria, and now he is the chairman of the Canadian Chamber of Commerce in Bulgaria. Another member of the board of directors is Svilen Spasov, former consultant of the American "Westinghouse" in Bulgaria. It is this company that is currently conducting a study on the construction of one or two new reactors at a new site at the Kozloduy NPP. Spasov was chairman of the board of the Varna Shipyard in the period 1997 and 1999 and as such was cleared as a secret collaborator of State Security. The fourth member of the board is Yanko Jinkov - a businessman whose business is in the import of mineral water and wine and in real estate.
Source: Dnevnik (17.01.2024)

Gas in March cheaper by 13%. Azeri supplies and from Revitusa, but without Alexandroupolis The state gas supplier "Bulgargaz" submitted an application for a natural gas price in March, which is slightly more than 13 percent lower than that of February. The quantities include deliveries under the Azeri contract, liquefied gas provided by France's Total Energy at the Greek terminal Revitusa, residual that the same company transported last month to a facility in Turkey and was not fully imported under the agreement with BOTAS, as well as quantities from the gas reserves in Chiren. However, deliveries to the country from the new Greek liquefied gas regasification terminal near Alexandroupolis, where "Bulgargaz" has reserved 1 billion cubic meters of annual capacity, are not included for March. The owner of the facility, in which the Bulgarian gas operator Bulgartransgaz has a 20 percent stake, had announced that the terminal would enter into operation at the beginning of March. However, it turns out that this will happen in April, and moreover, Bulgargaz still has not signed the contract with the preferred supplier of liquefied gas for the next ten years of Alexandroupolis. The tender for the provision of these 1 billion cubic meters per year dragged on for almost a year, a supplier was selected already in the fall, there is still no contract, and the answer of "Bulgargaz" is that the clauses are still being cleared. According to the application to the Commission for Energy and Water Regulation (KEVR), the price of gas in the coming month should be BGN 62.39/MWh without taxes and fees, while at the moment the value for gas supply companies, heating systems and enterprises is BGN 71.08/MWh without taxes and fees.
Source: mediapool.bg (20.02.2024)

In the past year 2023, there has been a significant shift in the electricity market in Bulgaria, according to the data from the annual report of the Commission for Energy and Water Regulation. The production of electricity from coal-fired power plants has decreased by almost half - by 46 percent at lignite-fired thermal power plants, such as the Maritsa East power plants, and by 51 percent at black and brown coal plants. The drop in hydropower production is 21 percent. "Kozloduy" NPP has reduced its production very slightly - by 0.23 percent. All this leads to a 22% reduction in the current delivered to the power grid. A significant growth of 141 percent marks the production of energy from photovoltaics. Since the solar parks are not connected to the high voltage network, but to that of the electricity distribution companies, the electricity delivered to the private network operators has increased by about 30 percent. Thus, last year the nuclear power plant produced the most electricity and its market share was 43 percent, thermal power plants accounted for 29 percent, and the remaining 18 percent of the electricity came from renewable energy sources. In 2023, the Commission for Energy and Water Regulation issued 27 new licenses for electricity traders, and there are now 168. The price of natural gas decreased by about 51 percent throughout 2023. If in January the blue fuel cost BGN 179.33 ./MWh, in December the price was already BGN 87.50/MWh. The decline continued in the first three months of 2024 and took another 23 percent from the price of gas, but for April the expectations of the state supplier "Bulgargaz" are that it will increase, albeit by the minimal 2 percent from the current 57.59 BGN to 58.84 BGN/MWh "Bulgargaz" bought more liquefied natural gas last year than piped under the production contract from the Shah Deniz II field in Azerbaijan. The data also show that there is a significant movement in the free electricity market in our country, and there are also 35 new players who have received licenses to trade in blue fuel, and their number is now 108.
Source: mediapool.bg (27.03.2024)

"Bulgargaz" announced a tender for gas supply to Alexandroupolis in May After in September 2022 Bulgargaz announced a tender for ten-year supplies of the liquefied gas regasification terminal still under construction at the time near the Greek city of Alexandroupolis, a year and six months later there is still no contract with the winning candidate, whose name and remained a secret. Today it is not at all clear whether there will be a contract for gas supplies of 1 billion cubic meters per year until 2034, but "Bulgargaz" is looking for candidates to unload 150 thousand cubic meters of liquefied gas or 1 million MWh in May of the facility in Greece, which will begin operations on April 30. The announcement for the quantity is from March 27, and the deadline for expressing interest in participating in the procedure is April 2. Eligible suppliers must submit their bids by 10:00 p.m. on April 4, and their bids will be opened the following day at noon and a winner will be selected by 5:00 p.m. The criterion is the lowest price that will be formed from the indices of the Dutch exchange TTF with a discount given by the supplier. The terms of the procedure allow the liquefied gas to be delivered to a Turkish terminal instead of Alexandroupolis under the agreement between "Bulgargaz" and the Turkish BOTAS. According to the conditions, the cargo should be delivered on May 18 at the Greek terminal or in Turkey. It is not clear why the public gas supplier is seeking these quantities and, above all, whether there will even be a ten-year liquefied gas contract at Alexandroupolis, where Bulgargaz has reserved 1 billion cubic meters of regasification capacity per year and will pay the agreed fees regardless does it deliver tankers to this terminal.
Source: mediapool.bg (01.04.2024)

The absurdities in the Bulgarian energy industry continue. With a decision approved on Friday, the resigned government of Nikolay Denkov has amended one of the series of decisions in the sector, obliging "Bulgarian Energy Holding" to donate BGN 728 million to the Power System Security Fund. The strange donation was reached after the National Assembly obliged the Ministry of Finance to urgently provide BGN 1 billion to cover a deficit in the fund, which must cover the costs of liberalization of the electricity market for households. Now, however, it turned out that a local tax amounting to BGN 36.4 million must be paid on the donation. Usually the tax is paid by the recipient, but in this case the cabinet decided to oblige the donor BEH to pay it. By law, the state and municipalities are exempt from local tax on donations, but in this case the grant funding is from a commercial company to a fund. The donation itself should be made within 7 days from the day on which the Ministry of Energy will acquire the debts of "Heating-Sofia" to BEH and "Bulgargaz" for a total value of BGN 1.6 billion. There is currently no data on this operation to be finalized. No similar draft documents for entry have been submitted for the lot of the municipal company. There is no decision of the metropolitan municipal council on the subject, and the company is municipal. The scheme proposed by the "Denkov" cabinet for the transfer of loans and debts in the energy sector is very problematic, especially in terms of state aid. It is not clear whether, against the background of these questions, the caretaker government will not cancel the decree on granting 1.6 billion BGN extraordinary funds from the budget of the Ministry of Energy until receiving an opinion from the EC. The amount was ordered by the Ministry of Finance at the beginning of April, and the huge payment is one of the reasons why the parliament decided to limit payments outside of pensions, salaries and overheads. If the MC revokes the decree, another solution will have to be sought to secure funds for the Power System Security fund.
Source: Sega (12.04.2024)

BEH changed the management of several companies in the energy sector The Bulgarian energy holding made changes in the management of "Mini Maritsa Iztok", the National Electric Company, in the board of directors of "NPP Kozloduy-New Powers" and the operator of the gas connection with Greece. By decision of the holding, Todor Todorov, who held the position from 2009 to 2011 and in January 2022, was appointed as executive director of "Mini Maritsa-East". Deyan Ivanov, a former associate in the parliamentary committee on energy. The resignation of Svilen Spasov as a member of the Board of Directors of Kozloduy NPP - New Powers EAD was also accepted. His place is occupied by Georgi Dobrev, who has many years of experience in the field of energy. A change has also been voted in the Supervisory Board of "ICGB" AD - in the place of Momchil Vanov as a member of the Supervisory Board, Rumyana Petrova enters. Her professional path is also in the field of energy, having held positions in the "Legal" Directorate at "Bulgargaz" EAD - chief legal advisor, deputy director of the directorate and director of the directorate. A general meeting of the shareholders of ICGB AD is to be convened for decision-making.
Source: econ.bg (17.04.2024)

"Bulgarian Energy Holding" has accepted the resignation of Denitsa Zlateva as executive director of "Bulgargaz" By decision of the Board of Directors (BoD) of "Bulgarian Energy Holding" EAD, a change was made in the management of "Bulgargaz" EAD, as Denitsa Zlateva's resignation was accepted, and Dimitar Spasov and Tatyana Petrova were dismissed from the company's Board of Directors. - Boyadzhieva. Mihail Milkov, Bianka Racheva and Marin Filipovski take their places. By decision of the Board of Directors of Bulgargaz EAD, Veselin Sinabov was appointed as the executive director of the company.
Source: blitz.bg (18.04.2024)

T?rkiye wants the continuation of the cooperation of BOTAS with "Bulgargaz" T?rkiye so far shows no readiness to terminate the agreement between BOTAS and Bulgargaz, which is pushing the Bulgarian state gas operator towards insolvency. This became clear after the meeting between Bulgarian Minister of Energy Vladimir Malinov and his Turkish counterpart Alparslan Bayraktar in Istanbul. "The Bulgarian side expressed a desire to revise the contract, and the Turkish side expressed understanding and willingness to continue cooperation. The energy ministers tasked the management of the two companies to start active work in connection with the agreement between "Bulgargaz" and "Botash". The Bulgarian authorities have been trying for more than half a year to reach a renegotiation of the agreement, but unsuccessfully. The contract between Bulgargaz and BOTASH is for the reservation of capacity of 1.85 billion cubic meters per year from Turkish liquefied gas terminals and to the Bulgarian border through the pipes of the Trans-Balkan gas pipeline. According to the contract, until 2035, "Bulgargaz" can unload tankers at certain LNG terminals in T?rkiye and receive the same amount of natural gas at the Strandja-Malkochlar border crossing.
Source: mediapool.bg (29.04.2024)

Bulgargaz launched a tender for the supply of 1 million MWh of liquefied natural gas for the month of June "Bulgargaz" JSC launched a tender procedure for the supply of 1,000,000 MWh of liquefied natural gas (LNG) in June 2024. Among the conditions for participation in the procedure is that the source of supply of natural gas is from countries without imposed sanctions, embargoes or commercial Limits. The ownership of the companies must be clear and they must have a good commercial reputation, the company states. The delivery of the liquefied natural gas is expected to be carried out at an LNG terminal in Turkey, according to the agreement concluded with the Turkish state company Botash. Participants admitted to the tender procedure will have to submit price offers referring to the TTF index, which will be evaluated and ranked according to the Evaluation Methodology attached to the tender documents. On May 14, the price proposals of the admitted candidates will be opened.
Source: news.bg (02.05.2024)

Bulgargaz will claim damage suffered from the termination of natural gas supplies by Gazprom in 2022 The new management of "Bulgargaz" will claim damages suffered from the termination of natural gas supplies at the end of April 2022 for over 400 million euros. Gazprom Export will be given 1 month to voluntarily settle the claim. If no agreement is reached, an arbitration case will be filed in Paris, announced Energy Minister Vladimir Malinov. These claims are based on a legal and financial analysis, in the preparation of which the services of international law firms were also used.
Source: Dnevnik (17.05.2024)

"Bulgargaz" sells its reserved capacity in Turkish LNG terminals Bulgargaz has announced two auctions for the recovery of the reserved capacity of 1.850 billion cubic meters annually at Turkish terminals for regasification of liquefied gas. One is for the sale of other suppliers of the right to supply gas to Turkey, to store it there and transfer to Bulgaria. The other is for the provision of this service in favor of suppliers on behalf of Bulgargaz, against which the Bulgarian state-owned company will collect a fee and with the revenue will be paid with Botash for the ownership of the 13-year agreement. This solution to the problem of Bulgargaz Capacity was announced to journalists by the official energy minister Vladimir Malinov and the head of the company Veselin Sinabov to journalists on Thursday, and later the conditions and terms of the two procedures were published. Sinabov commented that this was being undertaken to use the capacity of the agreement, which exceeds the possibilities of the company he managed, and in addition the consumption of natural gas decreased. For nearly a year and a half of the contract with Botash "Bulgargaz" has managed to use a minimum part of the capacity with the supplies of three loads for a total of 2.5 million MWh, and in June the fourth will be carried out - from Botash itself. Although Malinov said that other gas supply tenders would be announced for Bulgargaz under the agreement, the company will not be able to use all the capacity, but pays over $ 480,000 a day.
Source: mediapool.bg (17.05.2024)

Natural gas rises 8% in June In June, the price of natural gas will be about 8% higher than last month. The Energy and Water Regulatory Commission (EWRC) has approved a natural gas price for June of BGN 59.55 per megawatt hour (MWh). In May it was BGN 54.70 per MWh. The value is net of access, transmission, excise and VAT prices. At this price, Bulgargaz will sell natural gas to final suppliers and to persons who have been issued a licence for the production and transmission of heat. The regulator approved the price after an analysis of the actual data submitted by the public supplier, forming the natural gas price for June. According to the EWRC, despite the price increase for June, the analysis shows that Bulgargaz has secured favourable supply conditions, against the backdrop of an increasingly high increase in the benchmark TTF index in May. On 31 May, the last working day of the month, at the close of the Dutch exchange, the TTF index reached ˆ34.70 per MWh, i.e. BGN 67.87. Bulgargas's price for June is BGN 8 lower, the regulator said.
Source: mediapool.bg (03.06.2024)

Gas traders will receive BGN 278 million Natural gas traders who pumped quantities into the gas storage in Chiren in the period May 1, 2022 - October 11, 2022 will receive a total of BGN 278 million in compensation because at that time the raw material was very expensive and today it cannot to be implemented in the market, where prices are already much lower. This was decided by the interim government of Dimitar Glavchev by approving a program for the payment of compensations from the "Security of the Electricity System" Fund, which will enter into force after being approved by the European Commission, since it is a matter of state aid. According to preliminary estimates, the state-owned public gas supplier "Bulgargaz" will receive the largest part of the amount – BGN 157 million. The remaining BGN 122 million is for other traders who pumped gas in this period. Among them is the company "Sustainable Energy Supply", which is owned by the subsidiary of the Russian company "Lukoil" company "Litasco" and the former boss of "Lukoil Bulgaria" Valentin Zlatev. It imports Russian natural gas to Bulgaria for the needs of the Burgas refinery "Neftohim" and has reserved capacity in the gas storage facility. The Greek company "Mithylineos" also has capacities in Chiren, which systematically supplies gas to the Bulgarian market through "Bulgargaz". According to the Council of Ministers, the compensations are necessary because, assuming a certain commercial risk, the companies have contributed to achieving the target of a storage capacity of at least 80% in accordance with the European emergency action plan.
Source: mediapool.bg (08.07.2024)

"Bulgargaz" rescheduled the debt for millions of TPP "Varna" The management of "Bulgargaz", appointed by the "Glavchev" cabinet, rescheduled for 3 years 37 million BGN of the awarded obligations of the "Varna" TPP, owned by the honorary chairman of the DPS Ahmed Dogan. This was reported by the investigative site BIRD, citing an agreement between the two parties concluded on May 31 of this year. The information comes a few days after it became clear that "Bulgargaz" is hiding information about whether TPP "Varna" EAD pays its debts, accumulated as unpaid installments for the supply of natural gas. Acting Minister of Energy Vladimir Malinov pointed out that the information concerns commercial relations between third parties and is defined by Bulgargaz EAD as a "trade secret".
Source: actualno.com (09.07.2024)

Bulgaria's aspiration to membership in the OECD and the explicit requirement to improve the management of state-owned companies does not particularly respect the authorities. On the boards of state-owned companies, appointments without competition continue en masse. This is shown in the annual report of the "Public Enterprises and Control Agency" on state-owned public enterprises for 2022. According to the data up to the end of December 2022, three out of three members of the "Information Service" board were elected without competition. 7 of the 7 members of the management of the state enterprise "Management and management of dams" did not go through the competition procedure. 5 out of 5 members of the board of "Bulgargaz" were also elected without competition. In the transport sector, 5 out of 5 members of "Holding Bulgarian State Railways", as well as 3 out of 3 members of the boards of "Sofia Airport" and "Plovdiv Airport", did not go through a public procedure. Competitions were not held for the management of any of the state companies under the Ministry of Sports, as here all board members - a total of 19 people in 5 companies - were elected without a competition. With the rules for implementing the law, it was practically possible to bypass the requirement for a competition with the possibility to appoint temporary holders for a period of up to 6 months. In 2022, state-owned enterprises reported a serious increase in revenues, with 171 of 265 state-owned enterprises reporting a net profit in the total amount of BGN 3.89 billion. Revenues from operating activities reached BGN 32.8 billion - nearly BGN 13 billion more than 2021, with the main contribution coming from the energy sector with total revenues from operating activities amounting to BGN 25.1 billion. The dividend paid into the state by public enterprises in 2022 is BGN 1.524 billion, with the vast majority of it is a payment from BEH - BGN 1.439 billion, including retained earnings from previous years.
Source: Sega (09.07.2024)

"Bulgargaz" filed a lawsuit against "Gazprom" State-owned gas supplier Bulgargaz filed a lawsuit against Russian company Gazprom Export before the Court of Arbitration of the International Chamber of Commerce in Paris, seeking compensation of more than 400 million euros for damages suffered as a result of the unilateral suspension of natural gas supplies in April 2022. In May 2024, Bulgargaz EAD sent an invitation to Gazprom Export for a voluntary settlement of the claim according to the contract between the two companies. The Russian side has done nothing to resolve the issue out of court. The amount of the claim was determined on the basis of a legal and financial analysis, in the preparation of which the services of international law firms were also used. Russia, which until the beginning of its invasion of Ukraine was practically the only supplier of natural gas to Bulgaria, suddenly stopped the supply despite the existing contract and declared the country unfriendly.
Source: econ.bg (10.07.2024)

IMF: State-owned companies in Bulgaria are expensive, inefficient and carry risks for everyone Large companies with state participation in Bulgaria have low profitability and inefficient allocation of resources, and although they are not significant in terms of share, they play a decisive role in the production network, which can negatively affect the productivity and competitiveness of the entire economy. The level of state-guaranteed debt of state-owned enterprises is small - on average only 0.5% of GDP in 2010-21 (the average level in the EU is 9%, and in other countries of Central and Eastern Europe it is 3.5%). And the support with such guarantees due to the COVID-19 pandemic was many times lower - 0.3% of GDP in Bulgaria compared to almost 2% in the EU for 2019-2021. But there is a key point - there is no generalized information on guarantees in Bulgaria, issued by the state-owned enterprises themselves, since their activity does not require the approval or supervision of the Ministry of Finance. Thus, total liabilities averaged around 12% of GDP in 2013-2021, which could be a source of concern. This is stated in the Analysis of the International Monetary Fund "Fiscal risks of state-owned companies". The analysis is based on data from 15 companies in which the authorities at various levels have over 50% share: Energy sector (National Electric Company (NEK), Kozloduy NPP, Bulgargaz, TPP Maritsa Iztok 2, Electricity System Operator, Bulgarian energy holding (BEH), Mini Maritsa Iztok, "Bulgartransgaz"), Transport sector (National Railway Infrastructure Company (NRI), BDZ - Passenger Transport Ltd., Air Traffic Control (RVD), Transport Construction and Reconstruction (TSV), BDZ - Cargo Services Ltd., Port of Varna, Bulgarian Port Infrastructure). The total assets and liabilities of these 15 companies represent about 70% of the total for the entire segment with state participation 2015-2021, which covers about 700 companies. The general assessment for them is that the fiscal support is much higher than what they give as revenues to the budget. In 2017-19, they received subsidies, capital investments and capital transfers (direct support) and deferred tax and dividend exemptions (indirect support) of an average of 1.5% of GDP. To this they have responded with a contribution of 0.2%. Net, they absorbed 1.3% of GDP immediately before the pandemic and at the end of the last GERB government. In the first pandemic year (2020), this ratio became 2.5% against 0.1% and is an illustration of how an unexpected shock can lead to large fiscal costs for companies with state participation, the IMF says. These are companies in which 4.1% of all employed work. Their financial stability can affect the fiscal performance of the state, especially when they have incurred potentially significant costs, whether expressly guaranteed or without the authorities making a contractual commitment. In 2023-2024, the state doubled the dividend collected by these companies from 50% to 100% to support the budget, but the price for this is a risk to their investment, productivity and profitability. "Furthermore, the dividend policy lacks predictability and seems to be driven by the needs of the state budget. Such a policy reduces the incentives of companies to invest and thus has a significant adverse effect on economic activity," the authors of the report add. State-owned companies are much, much less profitable than those in the private sector. Return on assets (one of the key measures of profitability) was between minus 1% and 2% for the period 2015-2021, with an average of 10% in private. In 2022, this difference suddenly melted (9% for state-owned, 11% for private), but not because there was better management, but because of three specific companies - NEK, Kozloduy NPP and Maritsa Iztok 2 TPP, and their income from sharply increased energy prices due to Russian aggression against Ukraine. Return on equity (another measure of profitability, measuring a firm's ability to generate profits using its shareholders' capital) for SOEs is on average 20 percentage points lower than that of private firms. Due to the specifics of many state-owned enterprises, profitability is logically lower than that of private ones, but in countries with better management results, the difference between them is 4 percentage points or five times smaller than in Bulgaria, the IMF recalls .Everyone suffers from the bad management of business with state participation. Six state-owned enterprises have been facing short-term challenges in meeting their obligations for years. In the period 2015-2022, without sufficient liquid assets to cover the amounts due to creditors in the next 12 months were National Railway Infrastructure Company, TPP Maritsa Iztok 2, National Electric Company, BDZ - Passenger Transport, BDZ - Freight Transport and Transportation Construction and Reconstruction. Bulgargaz faced a liquidity crisis in mid-2022 due to low collection of receivables and arrears from Toplofikatsia Sofia. Accumulated arrears to suppliers were paid through a (bridging) loan and/or state aid. Another indicator of concern to IMF analysts is the high debt-to-asset ratio (ie, less financial flexibility) of several large state-owned enterprises. These are, for example, "Bulgartransgaz", National Railway Infrastructure, Bulgarian Energy Holding and Electric Power System Operator. It has also seen how debt-to-asset dynamics can change sharply - in the case of Bulgargaz, it jumps from around 45% in 2019 to over 90% in 2022. The combination of high debt and low profitability raises concerns for the ability to service the debt and therefore risks at the fiscal level, the IMF explains.
Source: Dnevnik (18.07.2024)