Electrica to pay RON 14 million to subsidiary in legal settlement

BUCHAREST - Romanian utility company Societatea Energetica Electrica S.A. (BSE:EL) has been ordered to pay approximately RON 14 million to its subsidiary Distributie Energie Electrica Romania S.A. (DEER) following a final court ruling in a long-running legal dispute.

The Brasov Court of Appeal definitively resolved the case on August 8, requiring Electrica to pay RON 8.95 million plus legal penalty interest dating back to December 21, 2018. The total amount due as of August 11 is RON 14.06 million, with interest continuing to accrue until payment is made.

The dispute originated from services allegedly paid for but not performed by Electrica during 2010-2014, based on consultancy, mandate, and service agreements between the parties. The issue was initially flagged by Romania’s Court of Accounts in a 2013 report.

The court partially admitted DEER’s claim, establishing the payment obligation on the basis of contractual civil liability. Electrica was also ordered to pay RON 15,000 in legal costs to the plaintiff.

Electrica stated it would analyze the possibility of filing extraordinary appeals after receiving the court’s full decision. The company noted that while the settlement has not been provisioned and will impact its standalone financial statements, it will have no effect on consolidated results.

The utility also disclosed a separate positive financial impact of approximately RON 11.89 million from another legal case concluded in October 2024, involving tax refunds from Romania’s tax authority (ANAF). This partially offsets the financial impact of the current settlement.

According to the company’s statement based on the press release, the combined impact of both legal matters on Electrica’s individual financial results will be immaterial.

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