Ladies and gentlemen, welcome to the press conference of the TAURON Group, where we will present the financial results for the first quarter of 2026. My name is Sihon, and I am the representative of TAURON. I will moderate the meeting. The first part, we will present the financial results, and the second part will be answering your questions that you ask through our form on our website. Now I will introduce our participants: Mr. Krzysztof Śliwicki, the Vice President of the Management Board for Trade, Mr. Krzysztof Surma, Vice President of the Management Board for Finance, and Mateusz Lewandowski, Executive Director for Investments in TAURON Polska Energia S.A. Please proceed with the presentation of the results. Good morning. We are starting traditionally with the situation in the energy sector. Several pieces of information are in the current quarter. The increase of daily amplitudes. We can say that the highest price, from generating today, is more than PLN 2,000, and the lowest is PLN 1,300. We can see the discrepancy is increasing, and it becomes the characteristic feature of our sector. We also noted an increase of installed power in the photovoltaic. It is 25.7 GW. We don't yet have the information on the end of March, but we expect the increase. We noted a slight decrease in the hours, but we expect the yearly increase in hours. Last year, we had 362 negative hours, so this year, I think it will be more than 400. We also noted the decrease of the coal prices and, on the other hand, the increase of the power and energy prices. In 2026, we could say that the generation on coal was more competitive compared to gas. We also noted the drop of average temperatures compared to last year, which increased the sale of heat. The negative phenomenon of worse conditions for wind generation. It was the worst in a decade. Now it's 23. Quarter- to- quarter, it's a drop, and it is an 8.3% drop. Water generation quarter by quarter is slightly higher, 12.3% - 13% generation, but looking at the hydrologic conditions, we cannot expect good results. Increased production from hard coal and gas by 7.3% at the cost of the other sources. In the same period, PKB grew by more than 33% compared to the last period, but the growth increased by 0.2%. It is also not advantageous that we can expect increased power consumption in the nearest future. RES dropped by 1.1%, but bearing in mind that we have increased installed power in the system, it dropped by about 30%. The hard coal and gas also dropped together with the brown coal. The balance between the last and this year, the import balance in February is 414. In March and in April, the export balance was increased. Redisposition, this is increasing in the energy system, unfortunately. The negative fact is that the compensations paid do not cover the lost revenue, as the settlement is at the prices of the balancing market. It is slightly not closely related to the actual commercial conditions. The generation portfolio, what we observed in our case, showed an increase in production generation by 18%. This is with RES increased by 13.7%. In this period, we have a 24% increase in the installed power. The productivity dropped a little. This is the characteristic feature of the whole energy sector and the RES units. Increase of heat production due to the lower temperatures. CO₂ emissions increased by 14%, mainly by the increased production from conventional sources. In case of the consumption of coal, which is associated with increased generation from coal. RES share, 13% drop. It's lower compared to last year. Limitation of 40% increase of the reduction in the RES. This limitation of this production, its structure, changed. It dropped compared to last year in the economy. It means that a big portion of energy is being lost. This is the energy that cannot be used effectively. What else? I assume this is the cost of transformation and a feature of the system. From the point of view of the group, the disposition is more profitable than settling the production at negative prices. Water electric plants are slightly lower. Wind and heat have increased this availability. Coal units are decreasing, averaging 81% availability, mainly due to plant and non-plant stoppages in Jaworzno in 2025. Selling portfolio. Electricity sales increased by 9.3%, which is households and small businesses. For households, we see an increased number of collection points and consumption points. In small and medium enterprises, it is increased by the volume. The green sales ratio is a quotient of the purchased green energy divided by the total green energy sold. The decrease is caused by the fact that we have the increased total energy. Number of Nowa Energia customers. As we can see, mostly it's households. 21% are the small businesses. Large businesses are below 1%. Energy is fed into the grid by the procurement, the drop is caused by either the increased own self-consumption or lower production in that period. As we know, generally, areas will have lower production. These two can maybe be combined. Heat sales to the market increased in the first quarter because of the lower temperatures and cold weather. Cheap Hours customers. This is the tariff with differentiated, varied rates. It is dedicated to educated clients, to those who are aware of how to adjust. We had 25,000 customers at the end of last year, so we have about a 40% increase. What we do with regard to educating our clients is conduct an educational campaign with regard to the knowledgeable use of energy. We propose products with dynamic prices. We propose our advisor. Our approach is to educate customers to lower their bills. Now we can go to the second part. I give the floor to my colleague. Ladies and gentlemen, the results of the Group for the first quarter are good. Of course, compared to the record, the results of last year, they are slightly lower, but these are still very good results and effects. Revenues dropped slightly compared to last year. The drop was caused by the slowly lower energy rates, but if we removed compensations, we would have an increased revenue. 2025 was the last year of the compensations. More than PLN 300 million revenue was from that last year. EBITDA was 10% lower compared to last year. It reached PLN 2.04 billion in the first quarter of this year. When we compare it and deduct the one-off events in 2025, it's a year-over-year comparison. In 2025, we had one-off events. One was concerning the compensation in the generation segment, and the other event concerned the tariff. It is even one year before mid-2024, the tariff was set untypically for a year and a half. The costs were unevenly distributed on our side. The costs were not transferred fully, and they were recovered in 2025. That is why we had abnormally good results, and that is why this quarter seems not to be so good. The analytical consensus was exceeded by PLN 150 million. In the group, net profit was related to the operating results, and it is connected with the increasing depreciation level. It is the derivative of the investments in the group. This result was corrected and adjusted upward due to the lower interest and tax. Costs, CapEx increased slightly by 7%. Mateusz will talk about it in more detail. The EBITDA from the point of view of our financial institutions and from the estimate performed by them, it is the same as at the end of 2025 and slightly better compared to the first quarter of 2025. If we go to the segment slide. We have an unchanged leader, the distribution is close to PLN 1.2 billion. If we look at the further places, they are pretty equal. EBITDA of about PLN 200 million is in these next three segments. It is sales, generation, and heat—more than PLN 200 EBITDA for all of them. The last one, the heat, has had the best quarter in history. Since our publication for generation and heat is published, the first time is when the heat is higher than generation. We will talk about it in more detail later. Another slide shows the differences year-over-year. Let's start from distribution. The difference is PLN 42 million. There were two positive and two negative factors. The negative factor was the regulation account settlement. Last year, we had the positive balance of the regulation account. This year, it's negative, and it's a PLN 111 million difference, more or less. Generally, as I said before, the regulation account is the difference between the actually executed volume and the volume allocated in the tariff. If the actually performed volume is higher than the volume allocated in the tariff, it sets negatively on the regulation account and vice versa. Over the years, it's then settled down. This balance of the regulation account will be slightly positive next year. The other negative factor of that segment is the WACC drop by more than 1.3 percentage points. It's right now 9.5%. The positive factor is the increase of the value of the regulated assets. It's a PLN 2 billion increase year-over-year. Another positive influence is the increase of volume by two percentage points year by year, and it mitigated the negative regulation account. When we look at the areas segment, I started to say that this is the weakest segment in this quarter, but of course, it's still with positive results. It was mostly affected by the lower market prices, both in the energy market and in the green certificates market. They were the dominant factor. Of course, we also accounted for a better result based on historical data. These wind conditions were much lower right now. If it weren't for the new power, we would have a drop of 7% from the wind production. With the heat segment, we can say it's only good news. Here, we had significantly lower temperatures this year, this winter. As Krzysztof said, the volumes of heat sales were higher, and it positively affected the results, including the addition to the tariff. We had a PLN 50 million increase of EBITDA year-over-year. We also consume results from TAURON Polska, which received means from TAURON Czech, which was a positive result effect on the whole sales segments. I've touched that a little. We had a very good first quarter in tariff G last year. This year it will be the opposite phenomenon. We will have no margin, and it will determine our results. This result will certainly be strongly dependent on the cost of the profile that will affect the company in quarters two and three. The results of the pricing differences will strongly determine the results of this segment in the latter part of the year. We also show that we changed the reserve. Last year, we concluded a reserve for tariff G. We estimated it for PLN 150 million. It will be released in individual quarters. It will positively affect the EBITDA of this year. As far as the generation segments are concerned, we have good results, a bit slightly more than PLN 40 million lower than last year. two key factors there. One event of the compensation payment. It concerned the previous year's compensations paid in the first quarter of 2025. Slightly lower margin caused by the lower level of sales, as Krzysztof also mentioned. This year, we had the phenomenon of much higher production versus redemption repurchase from last year. In previous years, we had much more repurchase, which was at a much higher margin. This year, the production, in fact, eliminated part of the repurchase due to the market situation because we always analyze whether repurchase or production is more beneficial. That's why the margin this year is slightly lower. We move on to the debt and financing slide, as I mentioned before, the ratio is at quite a good level. I mean, 1.4, relatively low, especially when we look at the historical record of the group. What influenced that then? I believe mainly EBITDA for the last 12 months, because it was a bit higher when we compare the quarters, and of course, I mean the 12 months back, and especially the first quarter of 2025 versus 2026. You can see PLN 400 million on the right-hand side. The second factor is a decrease in the debt. I believe the net debt that we report to the bank as well as the economic debt, which we can see here in this graph. In both cases, it's about PLN 100 million, yeah, year-over-year. I would like to draw your attention to the graph and especially to those factors. I mentioned them in the previous conferences as well. I believe that these increasing funds coming from KPO, I mean, the National Recovery Plan, are high. This is PLN 2.2 billion. At the end of the first quarter of 2026, PLN 1.354 million was in a kind of subsidy, which is a kind of inter-period settlement after discounting the debt, which was granted with the 0.5% rate. It was discounted with the market rate, it also comes from the result between the nominal value and the discounted value. This is the interperiodical settlement, they are going to be depreciated, just like the assets financed by this loan. The second factor is, as we promised, we paid back all the debt. At the end of the first quarter, we have no stocks and no bonds. It was the biggest part of our debt. Everything has been paid back in the first deadlines, according to the contracts on the bonds or the loans. The third point I would like to draw attention to is leasing. It's increasing gradually, but I believe this is a natural derivative of the business growing, especially in the distribution sector. All the mortgages and all the property agreements are included here in this category, in the leasing category, as debt. I would like to emphasize that the group has a very good position when we consider the cash flow and the liquidity. The company has PLN 6.3 billion of funds. According to our policy, these resources are always guaranteed to cover investment in the next 12 months. That's all that I would like to present. Now Mateusz Lewandowski is going to talk about our investment program. When it goes about investment, we have realized the CapEx and PLN 1.164 billion. It's more than in the previous year, quarter-over-quarter. No surprises that we can say 70% in the distribution sector. RES assets, it's about 80% of our investment in the first quarter. Now talking about each segment, I would like to start with the biggest one, which is distribution. PLN 800 million in the CapEx. This is 100% of our realization. We met the targets in this period of time. When talking about the investment directions, about the connections that we built, and about the modernization and replacement of grid assets. I believe that was the majority of our CapEx. Thanks to that, we could connect about 400 MW of RES installations and 900 km of new energy lines, and we keep this direction. We follow this direction right now. Our customers covered by intelligent, smart ratios are about 47%. It's the coverage. Right now in this segment, it's more than 95% of the CapEx, which means that we are pretty optimistic about our plan for this year. RES. The CapEx was related to the realization of three big wind farms: Nowa Brzeźnica, Sieradz, and Mieszkowice. The first two were commissioned in the first quarter of this year, and they started working and generating EBITDA effectively. Mieszkowice, our biggest project. We are really advanced in this project, in the implementation of this project. I hope that if there is nothing unexpected, the commissioning of the object will take place in this half of the year. As far as the cash flows are concerned, this moment is crucial. What I would like to draw your attention to is also our program of batteries and energy storage facilities. I am going to talk about it later on as well. In this segment, there was also a modernization of hydropower plants, including one of the crucial plants in Pilchowice in the first quarter of this year. There have been several investment decisions related to the KPO funding. We have started with the tendering procedure for big photovoltaic farms in Ogrodzieniec, Sławice. Let's talk about the heat segment. I'm going just to summarize it. The CapEx in this segment mostly relates to modernization and generation and connections. We have some existing generating units, those CapExes now are related to these facilities where these assets are placed. What else? The decarbonization of these projects. There are a few of them, I'm going to talk about them later on. When we talk about supply and other segments, I would like to focus on the investment in the infrastructure, IT infrastructure, street lighting, and fiber optic network. I would like to pay more attention to particular projects. As I talked before about photovoltaic farms, you could see everything on the former slide. I would like to take one of our key projects, a key element in our investment portfolio. I mean, BESS projects. As you can see, it's 558 MW under construction, and eight of them have already been commissioned. This portfolio is full of projects besides those standard expositions. I mean, generating profits related to the volatility of the prices, whether this is the power market or the investment support market. The cash flows related to these projects will have this kind of real stability and stable investment support. I've mentioned two projects that have already been commissioned. I mean, in Tomice and Przewóz. They were commissioned this year. I would like to mention that it's a really fast implementation project because it took about half a year only, and this year we are going to add 16MW or more to this 8 MW from the project in Proszówka and Kuźnia Raciborska. They should be finalized by the second quarter, I mean, the second month from now. Then the portfolio of projects of more than 500 MW, which are in the first preliminary phase of implementation but still really advanced. I believe that we are going to gradually open the tendering procedures, the procurement procedures, so that this year we can sign the contracts and realize our targets. Moving on to the next project. The projects in the heat and generation segments. The key information here is that in the first two auctions that took place this year, we managed to have the support, operational support for five projects, and the biggest one is the project in Łagisza, which is based on two cogeneration turbines, about 100 MW of energy. It's worth underlining that the configuration of this project is much wider. Our model for these assets should also include some other constructions and more support. The realization of this project right now is also in the phase of contracting the turbines because, as in the project in Jaworzno, we are going to use this investor source model as far as the supplies are concerned. Construction of gas engines at Bielsko-Biała and the Jaworzno warm heat unit. Right now, we are about 35% of the implementation of this project, and to the best of my knowledge and our assessments, actually, as far as you know, this timeline is concerned, there are no threats to it. In Jaworzno, there is some kind of hybrid project that is supposed to combine two functions. The heat source for the city of Jaworzno is one of them. Right now, we are at the stage of contracting it, and we are trying to work on this procurement process. Of course, each year, such situations are included in our timelines, and we are ready for such obstacles. To finalize this investment sector, I would like to talk about our biggest project in this generation segment: the construction of a boiler house in Jaworzno, which works in the open cycle. Mid-April, we had to stop this project. We had to cancel it due to a lack of bids. Somehow we were ready. It was nothing surprising for us because there was a kind of scenario that predicted such situations. Finally, we decided that the best model, especially when we talk about the supply and supplement imbalance, is that a new single-source procurement procedure should be initiated. It's of course possible due to this law. We invited a company from Italy to participate in this project. It's based on two turbines that work in an open cycle and in the outdoor construction facility. Right now we are negotiating, but somehow this is the kind of solution that will enable our key parameters to be implemented. I mean, the CapEx, buying this technology, and of course the timeline of our implementation, which is a clue when we think about the contract. We believe in the few next weeks the project will be finalized. Thank you so much, gentlemen, for your presentation. Now it is the Q&A session. The first question is, When we're talking about the power supply market, at which stage are the works right now? What can we expect? Right now we are in the consultation with the European Commission. We don't know the effects and details of these conversations and this consultation, but we believe that the solutions will be very close to the current mechanism, maybe with some modifications. However, I will refer to the details after it is published after consultation with the European Commission. What about the government commission related to tariffs? Where are we now? At which stage? This topic is quite comprehensive. There's a special team that's been involved to cope with this issue, coordinated by the Ministry of Energy, and we've got some assumptions. The work is now going towards the division of the costs between the customers, and we want to increase the safety of the systems, electricity systems, and, of course, all the work also aims at the infrastructure and increasing it. I can say that right now the market is volatile. Maybe the volatility is a little bit higher, and our hedging strategy is based on quite conservative assumptions. On an ongoing basis, we try to follow the trends, especially the price trends. We include the volatility of the market, and I believe we try to adjust the strategy to minimize the risk and the chances in the market. We monitor the market and the regulatory aspects, so we try to adjust this strategy to the market. What about the contracting in Jaworzno, and what kind of costs can we expect? What about other gas projects? Will this delay in this project influence other units? The OCGT project in Jaworzno has already been commented on; maybe I can refer to it again. Currently, we are going to address a single contractor, Ansaldo Energia, from Italy, and we believe that it's going to take about several weeks. The level of costs that we can expect, we have no doubt, won't exceed these levels that we assumed, especially in the unit aspect. They are being prepared right now. Probably you know two of these projects were really effective and ready to be commissioned. Now we are ready to commission them still. Nothing changed. I believe it's also important whether we get these mechanics of support or not. Talking about other projects, we don't anticipate any problems. This project is being contracted right now, consequently, I don't believe this is a base scenario for us. If so, probably we'll need to carry on further discussions. Thank you so much. Can you comment, please, on CapEx this year, talking about each particular segment? I'm not going to refer to values. Talking about segments, let me talk about distribution first. We can see that it's related to seasons. The CapEx is related to seasons, usually in the first quarter it's lower than in the next quarters. Somehow, as you can see, this implementation is multilinear. In quarters three and four, it's higher than in quarters one and two. Talking about the RES segment, I believe there should be some kind of impact of the Miejska Górka project. Let me talk about maybe CapEx of wind farms more. You cannot see that, but there are some advanced payments right now, so we've got funds for it, and the values in the next part are going to be visible in CapEx, so we can expect some additional values. In the further segments, as it goes about generation, I believe that our two huge projects, the heat system and OCGT block, are going to influence our CapEx, especially as it goes about advanced money. I believe that there are going to be some significant values seen. Other segments: I believe that the heat segment should be concerned as well, especially if we talk about CapEx and their decarbonization program. It's speeding up. We are starting new procurement programs, new tender procedures, and new projects. I guess those CapEx are going to relate to properties, to sites, to future construction works, and to this development work. Thank you very much. How do you assess the consensus of EBITDA at PLN 6.5 billion? Is it ambitious or basic? You know that we don't publish forecasts, but if we try to say anything, first of all, the quarters are unevenly distributed along the year. You know it from history. Is it an ambitious or basic scenario? It's not a certain scenario, but to achieve this level of EBITDA, many factors would have to happen. The key factor, first of all, is the issue of the cost of the profile. The second and third quarters will significantly tell us how the profile cost will be higher or similar to the previous one. Managing the profile cost will be a challenge to the group. The second issue is independent of us: the weather conditions, as we said, the wind conditions are low in the first quarter. We will see what it will look like later, further in the year. Of course, we know that the wind is crucial here, in addition to water and so on, but wind conditions are the most important. Depending on the situation in this segment, the EBITDA will depend on that strongly. The last item that is not fully controlled by the group is the issue of temperature. Right now, we are talking mostly about the autumn and winter heating system. It will determine the heating conditions. It would also depend on the weather. Next question in English. That was a translation of the question into Polish. It seems that, in reality, the group results will invent the possibility of regulating EBITDA. I answered it a little in my previous answer. The previous question touched that problem. The factors of the possibilities of generating profits. What are the indications? We have stable segments, like distribution. The tariff is known. The asset's value is known. The issue of the balance differences is not fully controlled. The other thing is the volumes of the distributed energy, but it seems to be quite a stable result, a predictable result. With regard to the RES segment, as I said, the wind conditions are the heat segment, which is the temperatures in the fourth quarter. The results should be better. We expect them to be better. The generation segment mainly concerns the market prices. The Middle East conflict may determine the spot market, and the prices in the spot market will, in fact, determine the value of production versus repurchase. We will see what it will look like in the fourth quarter about the gas availability and the prices. It will definitely determine the results in this segment. For generations, we must say that the lower wind conditions are in the whole country. Our generation assets will work and generate EBITDA, because they are completing the system in Poland. With the sales segment, here we have the profile issue. Second and third quarters, the profile cost will determine EBITDA in this regard. Thank you. Next question. How much has been left to spend the CapEx for Miejska Górka? We have incurred about 80% of the planned expenditures on that project. As we already said, we can't see these expenditures in the presentation of CapEx, but with regard to the cash flow, its finance flow is 20% of the budget. What about the safety of turbine supply to new units? Let's split it into two parts. We contract turbines to the various units, and these are different cases. With regard to Jaworzno, a lot has already been said. I can add that it seems that we are close to the situation when we are finished with the high risk of the contract, and it should be cleared in the next weeks. Other cases are the Łagisza and Katowice, with these procedures still open. These machines are different. These are medium power and medium capacity. They are serial production, and it's several hundreds of machines per year. Definitely, the fluidity of the slots and the availability are much higher. Then, also, the share of the CapEx in this project is not as strong as in the other cases, so it's not that risky. We, of course, are humble about the market situation, but I think we are moderately optimistic. One more question. How can we include KPO in the investment budgets, projects, and so on? As far as the information that we have is concerned, this team manages with WACC. WACC is not concerned there because it's about the energy-consuming issues. WACC is the discussion between the URE president and the other groups. We had a yearly model, and we hope to be able to work out some long-term mechanism for the distribution. Also, of course, one of the elements of it is the discussion on using KPO. With regard to distribution, we have a negative cash flow. Using the resources from KPO will let us use the technological gap and add consumers and provide a basis for the energy transformation. Thank you very much. Thank you. We have no further questions. Thank you for your questions and for your attendance. See you at the next results meeting and conference to sum up the first half of this year. Thank you very much. Goodbye.