Condensed consolidated interim financial statements
Condensed consolidated statement of financial position as at 30 June 2024
(before appropriation of result)
| In millions of euros | Notes | 30 June 2024 | 31 Dec. 2023 |
|---|---|---|---|
| Assets | |||
| Fixed assets | |||
| - tangible fixed assets | 4 | 9,345.9 | 9,237.2 |
| - intangible fixed assets | 112.2 | 90.2 | |
| - investments in joint ventures | 5 | 562.0 | 488.3 |
| - investments in associates | 0.6 | 0.6 | |
| - other participating interests | 7 | 7.0 | 7.0 |
| - deferred tax assets | 208.0 | 222.1 | |
| - derivative financial instruments | 7 | 0.9 | 6.1 |
| Total fixed assets | 10,236.6 | 10,051.5 | |
| Total current assets | 944.6 | 967.0 | |
| Total assets | 11,181.2 | 11,018.5 |
| In millions of euros | Notes | 30 June 2024 | 31 Dec. 2023 |
|---|---|---|---|
| Liabilities | |||
| Equity attributable to the N.V. Nederlandse Gasunie | 1 | 6,413.0 | 6,580.0 |
| Non-controlling interest | 17.5 | 16.0 | |
| Total equity | 6,430.5 | 6,596.0 | |
| Non-current liabilities | |||
| - interest-bearing loans | 6, 7 | 3,399.6 | 2,900.5 |
| - lease liabilities | 95.1 | 93.6 | |
| - contract liabilities | 90.0 | 86.9 | |
| - deferred tax liabilities | 198.0 | 209.5 | |
| - other non-current liabilities and provisions | 183.2 | 185.7 | |
| - derivative financial instruments | 7 | 11.2 | 22.7 |
| Total non-current liabilities | 3,977.1 | 3,498.9 | |
| Current liabilities | |||
| - current financing liabilities | 6 | 175.0 | 175.0 |
| - lease liabilities | 9.5 | 8.0 | |
| - derivative financial instruments | 7 | 8.0 | 3.4 |
| - trade payables, corporate income tax, other payables and contract liabilities | 581.1 | 737.2 | |
| Total current liabilities | 773.6 | 923.6 | |
| Total liabilities | 11,181.2 | 11,018.5 |
Condensed consolidated statement of profit and loss for the first half of 2024
| In millions of euros | Notes | First half-year of 2024 | First half-year of 2023 | ||
|---|---|---|---|---|---|
| Continuing operations | |||||
| Revenues | 2, 3 | 681.8 | 1,102.1 | ||
| Other revenue | 14.0 | 0.7 | |||
| Total revenues | 695.8 | 1,102.8 | |||
| Capitalised expenses | 68.8 | 47.6 | |||
| Personnel expenses and other operating expenses | 2 | -477.7 | -580.3 | ||
| Depreciation expenses | 4 | -161.2 | -210.4 | ||
| Total expenses | -570.1 | -743.1 | |||
| Operating result | 125.7 | 359.7 | |||
| Finance income and expenses | -24.1 | -30.5 | |||
| Share in result of joint ventures | 5 | 22.3 | 19.4 | ||
| Result before taxation | 123.9 | 348.6 | |||
| Income taxes | -28.4 | -82.5 | |||
| Result after taxation | 95.5 | 266.1 | |||
| Allocation of the result after taxation | |||||
| - Result attributable to the N.V. Nederlandse Gasunie | 94.0 | 266.1 | |||
| - Result attributable to non-controlling interest | 1.5 | - | |||
| Result after taxation | 95.5 | 266.1 |
Consolidated statement of other comprehensive income for the first half of 2024
| In millions of euros | Notes | First half-year of 2024 | First half-year of 2023 | ||
|---|---|---|---|---|---|
| Result after taxation according to condensed consolidated statement of profit and loss | 95.5 | 266.1 | |||
| Sum of actuarial gains and losses on employee benefits, | 3.4 | -2.3 | |||
| of which corporate income tax | -1.0 | 0.7 | |||
| Total of results taken to equity which we will not reclassify to profit and loss | 2.4 | -1.6 | |||
| Changes in the cash flow hedge reserve concerning joint ventures and associates | 5 | 2.6 | 1.4 | ||
| Total of results taken to equity which we will reclassify subsequently to profit and loss | 2.6 | 1.4 | |||
| Other comprehensive income | 5.0 | -0.2 | |||
| Total comprehensive income for the year | 100.5 | 265.9 | |||
| Allocation of the total comprehensive income for the year | |||||
| - Comprehensive income attributable to the N.V. Nederlandse Gasunie | 99.0 | 265.9 | |||
| - Comprehensive income attributable to non-controlling interest | 1.5 | - | |||
| Total comprehensive income for the year | 100.5 | 265.9 |
Condensed consolidated statement of changes in equity for the first half of 2024
| In millions of euros | Share capital | Fair value reserve | Cash flow hedge reserve | Other reserves | Unappropriated result | Total | Non-controlling interest | Total equity |
|---|---|---|---|---|---|---|---|---|
| First half-year of 2024 | ||||||||
| Balance as at 1 January 2024 | 0.2 | -172.7 | -6.7 | 6,277.1 | 482.3 | 6,580.0 | 16.0 | 6,596.0 |
| Total of comprehensive income for the financial year | - | - | 2.6 | 2.4 | 94.0 | 99.0 | 1.5 | 100.5 |
| Dividend paid for 2023 | - | - | - | - | -266.0 | -266.0 | - | -266.0 |
| Added to other reserves | - | - | - | 216.3 | -216.3 | - | - | - |
| Balance as at 30 June 2024 | 0.2 | -172.7 | -4.1 | 6,495.8 | 94.0 | 6,413.0 | 17.5 | 6,430.5 |
| First half-year of 2023 | ||||||||
| Balance as at 1 January 2023 | 0.2 | -172.7 | -5.6 | 5,927.7 | 554.9 | 6,304.4 | - | 6,304.4 |
| Total of comprehensive income for the financial year | - | - | 1.4 | -1.6 | 266.1 | 265.9 | - | 265.9 |
| Dividend paid for 2022 | - | - | - | - | -200.0 | -200.0 | - | -200.0 |
| Added to other reserves | - | - | - | 354.9 | -354.9 | - | - | - |
| Balance as at 30 June 2023 | 0.2 | -172.7 | -4.2 | 6,281.0 | 266.1 | 6,370.2 | - | 6,370.2 |
Condensed consolidated cash flow statement for the first half of 2024
| In millions of euros | Notes | First half-year of 2024 | First half-year of 2023 | ||
|---|---|---|---|---|---|
| Cash flow from business operations | 270.8 | 669.3 | |||
| Net amount of interest paid and received, corporate income tax and dividends received | 6 | 18.8 | -129.4 | ||
| Cash flow from operating activities | 289.6 | 539.9 | |||
| Cash flow from investing activities | 4, 5 | -294.0 | -416.7 | ||
| Cash flow from financing activities | |||||
| Uptake of long-term loans | 6 | 498.2 | - | ||
| Lease payments | -4.6 | -33.9 | |||
| Uptake of short-term financing | 6 | - | 215.0 | ||
| Repayment of short-term financing | 6 | - | -215.0 | ||
| Dividend paid | 1 | -266.0 | -200.0 | ||
| Cash flow from financing activities | 227.6 | -233.9 | |||
| Net cash flow for the financial year | 223.2 | -110.7 | |||
| Cash and cash equivalents at previous year-end | 294.7 | 435.9 | |||
| Effects of exchange rate changes on cash and cash equivalents | -0.1 | -0.2 | |||
| Cash and cash equivalents at year-end | 7 | 517.8 | 325.0 |
Notes to the condensed consolidated interim financial statements for 2024
General
Preparation of the interim financial statements
These condensed consolidated interim financial statements (hereinafter called the ‘interim financial statements’) were prepared by the Executive Board on 18 July 2024.
Reporting entity
N.V. Nederlandse Gasunie (hereinafter also ‘Gasunie’, ‘the company’ and ‘we’) is a European energy infrastructure company. We are domiciled in Groningen, the Netherlands.
Our primary activity is to provide regulated transmission services in the Netherlands and Germany. We are also involved in joint arrangements for transport pipelines that connect the Gasunie transmission network with markets outside the Netherlands. Gasunie also provides other energy infrastructure services, like for gas storage, LNG imports, and the certification of biomethane and hydrogen. Alongside this, we are making extensive use of our infrastructure and knowledge for the further development and integration of alternative energy sources and carriers, such as hydrogen, heat and biomethane, and for transport and storage of CO2.
Gasunie is a public limited company and has its registered and actual offices at Concourslaan 17 in Groningen, the Netherlands, and is registered with the Dutch Chamber of Commerce under number 02029700. N.V. Nederlandse Gasunie is the ultimate parent of the group. All shares in N.V. Nederlandse Gasunie issued as at the balance sheet date are held by the Dutch State.
Reporting period
These interim financial statements cover the first six months of the 2024 financial year, with 30 June 2024 being the balance sheet date.
Presentation and functional currency
We present the financial statements in euros, which is also our functional currency. Unless stated otherwise, all amounts are in millions of euros.
Going concern
These interim financial statements have been prepared on a going concern basis. We believe that there is no uncertainty about using the going concern assumption.
Seasonal influence
Gasunie’s revenue and costs are not spread out evenly over the year, due to seasonal influences. Our core activity is the transmission of natural gas through the gas transmission network. Our revenue consists largely of the sale of the available transmission capacity and transmission-related services. Over the winter months, our customers book considerably more capacity than over the summer period. As a result, our revenue is higher in the winter months than in the other months of the year. While a substantial part of the costs of network operations is fixed, another part is variable and depends on actual volumes of gas transmitted. Larger gas transmission volumes in the winter months lead to higher costs over those months compared to the other months of the year.
Management judgements and estimates
In preparing the interim financial statements, we have used estimates and assessments that could affect the assets and liabilities presented as at the balance sheet date and the result for the first six months of the financial year. The actual results may differ from these estimates. We review the estimates and underlying assumptions on a regular basis. We recognise revisions to estimates in the period in which the estimate is revised and in future periods affected by the review.
The effect of our judgements and estimates is significant for the:
- measurement and determination of the service life of fixed assets;
- measurement of other equity interests;
- measurement of deferred tax assets;
- measurement of pension obligations;
- measurement and determination of the provision for abandonment costs and redevelopment;
- measurement of derivative financial instruments; and
- classification of investments in joint operations and joint ventures.
In certain cases, the judgements and estimates specified above are also affected by developments in the area of the energy transition, tightened environmental and climate targets and/or geopolitical developments. We take these developments into account in our judgements and estimates.
Basis for preparation
Statement of compliance
The interim financial statements capture the company’s periodic interim information and were prepared in compliance with IAS 34 ‘Interim Financial Reporting’, as adopted by the European Union. Since these interim financial statements do not contain all notes that are normally included in the financial statements for a full year, they must be read in conjunction with N.V. Nederlandse Gasunie’s 2023 consolidated financial statements.
The interim financial statements have not been audited or reviewed by our external auditor.
Accounting policies for the consolidation, measurement of assets and liabilities and the determination of the results
The company prepares its consolidated financial statements in accordance with the International Financial Reporting Standards (IFRS), as adopted by the European Union. In this context, IFRS comprises the International Accounting Standards (IAS) published by the International Accounting Standards Board and the interpretations of IFRS and IAS published by the IFRS Interpretations Committee (IFRIC) and Standing Interpretations Committee (SIC) respectively.
The accounting policies used in preparing the 2024 interim financial statements are the same as those used to prepare the 2023 consolidated financial statements, except for the new and amended standards detailed in the next section. Additionally, for comparison purposes we have adjusted the comparative figures for the first half of 2023, either to provide consistency with the 2023 consolidated financial statements or to give better insight. This concerns:
- separately explaining other revenue in the condensed consolidated statement of profit and loss and explaining the financial information per segment in Note 2 ‘Financial information by operating segment’ and revenue recognition in Note 3 ‘Revenue recognition’ excluding other revenue;
- the revised classification of the assets per segment in Note 2 ‘Financial information by operating segment’; and
- the revised classification of the regulated revenue in Note 3 ‘Revenue recognition’.
The company’s equity, net result, and cash flows were not affected by these changes.
New and amended standards for financial reporting
The following amendments to standards came into effect at the start of the 2024 financial year:
- Amendments to IAS 1 Presentation of Financial Statements:
- Classification of Liabilities as Current or Non-current
- Classification of Liabilities as Current or Non-current – Deferral of Effective Date
- Non-current Liabilities with Covenants
- Amendments to IFRS 16 Leases: Lease Liability in a Sale and Leaseback
- Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures – Supplier Finance Arrangements.
Furthermore, the standards or amendments to standards as listed below are expected to become effective in the future. EU endorsement has not yet been given for these standards:
- Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability
- Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7)
- IFRS 18 Presentation and Disclosure in Financial Statements
- IFRS 19 Subsidiaries without Public Accountability: Disclosures.
Our analysis revealed that the standards already adopted have no material impact on our equity, cash flow and/or result, and that the same will apply to the standards still to be endorsed. We do expect that certain main statements and disclosures will change, particularly those associated with IFRS 18, but that the impact of this will be relatively limited. For that reason, the consequences of amendments referred to above have not been described in detail in these interim financial statements.
Further notes to the condensed consolidated financial statements
1. Significant matters and significant transactions in the first half of 2024
Development of revenue and result
In the first half of 2024, our consolidated net revenue (excluding other revenue) fell by 38.2% compared to the first half of 2023, largely due to the lower permitted revenue in 2024 in our regulated segment.
Under the regulatory systems that apply in the Netherlands and in Germany, if the regulated revenue in any year exceeds the permitted revenue, we must return this surplus revenue to the market in the following years. In 2022, actual revenue in the Netherlands and Germany was substantially higher than the revenue cap set by the regulator, largely due to the unexpectedly high capacity sales that year as a result of Russia’s invasion of Ukraine.
Under the applicable IFRS standards, we were not allowed to recognise future settlements as a liability in the balance sheet in 2022 nor deduct them from our 2022 revenue or result and, as a result, our revenue in 2022 increased significantly. We only recognise any settlement of regulated revenue in the year in which the settlement actually takes place. Settlement of the surplus revenue for the 2022 financial year will take place starting from the 2024 financial year, with the effect that the permitted revenue in 2024 will be substantially lower.
The impact of the lower permitted revenue in the first half of 2024 on the net result has been tempered in part by lower operating expenses, with network and energy costs in particular being substantially lower.
We provide further details on the development of our revenue and result in Note 2 ‘Financial information by operating segment’ and Note 3 ‘Revenue recognition’.
Recognising EemsEnergyTerminal
The revised recognition of EemsEnergyTerminal starting from 1 October 2023 has consequences for the comparability of the figures for the condensed consolidated statement of profit and loss for the first half of 2024 with those of the first half of 2023. Up to 1 October 2023, we fully consolidated the net revenue and costs of EemsEnergyTerminal. On 1 October 2023, we sold 50% of our shares in EemsEnergyTerminal to Vopak and, from that date, we have been recognising EemsEnergyTerminal as a joint venture, meaning that we now only recognise our net share in EemsEnergyTerminal’s result. This share is included under the share in result of joint ventures.
This change means that while the net revenue and costs in the first half of 2023 include the underlying financial information of EemsEnergyTerminal, they do not in the first half of 2024. We provide further details on the development of our revenue and result in Note 2 ‘Financial information by operating segment’ and Note 3 ‘Revenue recognition’.
Dividend payment and transactions with related parties
In the first half of 2024, Gasunie paid out € 266.0 million (first half of 2023: € 200.0 million) in dividend to its sole shareholder, the Dutch State. This was the appropriation of the result for the 2023 financial year following a resolution by the General Meeting of 26 March 2024.
The nature of other transactions with related parties in the first half of 2024 is the same as reported in the 2023 consolidated financial statements. Transactions with related parties in the first half of 2024 were on an arm’s length basis.
2. Financial information by operating segment
Segmentation
We segment the financial information in line with the Group’s activities. The operating segments reflect the Group’s management structure and the business units. We differentiate between the following segments:
- Gasunie Transport Services
This segment covers network operations in the Netherlands and is responsible for managing natural gas transmission, developing the natural gas network and related plants, and helping to facilitate a well functioning market.
- Gasunie Deutschland
This segment covers network operations in Germany and is responsible for managing natural gas transmission, developing the natural gas network and related plants, and helping to facilitate a well functioning market.
- Participations
This segment focuses on developing energy transition projects, utilising existing participating interests to the full and facilitating new gas flows to north-western Europe for the sake of security of supply. This segment also includes a number of joint arrangements for transport pipelines that connect Gasunie’s transmission network with markets outside the Netherlands.
The accounting policies for measurement of assets and liabilities and the determination of the results of the operating segments used to prepare the 2024 interim financial statements are the same as the accounting policies used in preparing the 2023 consolidated financial statements.
The assets, revenue and results of a segment comprise items directly related to the segments and items that we can reasonably attribute to them. Because the financing of Gasunie mainly takes place at group level, liabilities are not segmented and so we do not report on these separately. Transactions between companies which belong to the segments are on arm’s length basis. Transactions between the segments have been eliminated in the financial information by operating segment.
Information on revenue and results by operating segment
Each operating segment’s revenue and result are as follows:
| In millions of euros | Net revenue | Result | ||
|---|---|---|---|---|
| First half-year of 2024 | First half-year of 2023 | First half-year of 2024 | First half-year of 2023 | |
| Operating segments | ||||
| - Gasunie Transport Services | 493.0 | 717.1 | 94.4 | 236.5 |
| - Gasunie Deutschland | 108.0 | 194.9 | 14.7 | 96.4 |
| - Participations | 139.2 | 262.9 | 16.6 | 26.7 |
| Inter-segment adjustments | -58.4 | -72.8 | - | - |
| Operating segments total | 681.8 | 1,102.1 | 125.7 | 359.6 |
| Unallocated financial income and expenses and result from participating interests | -1.8 | -11.0 | ||
| Result before taxation | 123.9 | 304.8 | ||
| Income taxes | -28.4 | -82.5 | ||
| Revenue and result after taxation | 681.8 | 1,102.1 | 95.5 | 266.1 |
| Allocation of the result after taxation | ||||
| - Result attributable to the N.V. Nederlandse Gasunie | 94.0 | 266.1 | ||
| - Result attributable to non-controlling interest | 1.5 | - | ||
| Result after taxation | 95.5 | 266.1 |
The significant decline in revenue of the Gasunie Transport Services (GTS) segment can mainly be explained by lower permitted revenue in 2024 and, to a lesser extent, by lower sales of capacity. Under the current regulatory agreements, GTS has had to correct its tariffs in 2024, among other things, to offset the surplus revenue from the year 2022, as explained in Note 1 ‘Significant matters and significant transactions in the first half of 2024’. The impact of the lower permitted revenue in the first half of 2024 on the net result has been tempered in part by lower operating expenses. Although personnel expenses were higher than last year, network and energy costs were substantially lower, partly due to lower energy prices and lower costs relating to our obligation to provide peak capacity.
Revenue from the Gasunie Deutschland segment also dropped due to lower permitted revenue, caused by regulated settlements from previous years, and lower capacity sales. This, in combination with a slight increase in operating expenses, produced a lower net result.
The revenue of the Participations segment decreased in the first half of 2024. However, this can be explained almost entirely by the change as of 1 October 2023 in how EemsEnergyTerminal is recognised in the accounts, as explained in Note 1 ‘Significant matters and significant transactions in the first half of 2024’. Adjusted for the effect of EemsEnergyTerminal no longer being consolidated in the accounts, revenue for the Participations segment is slightly lower than in the first half of 2023. This, in combination with a slight increase in operating expenses, produced a lower net result.
Inter-segment services represented a total value of € 58.4 million in the first half of 2024 (first half of 2023: € 72.8 million). During the first half of 2024, inter-segment services provided by the Gasunie Transport Services segment came in at a value of € 19.7 million (first half of 2023: € 32.6 million), for the Gasunie Deutschland segment this was € 0.3 million (first half of 2023: € 0.3 million), and the Participations segment provided inter-segment services to the value of € 38.4 million (first half of 2023: € 40.0 million).
Information on assets by operating segment
Each operating segment’s assets are as follows:
| In millions of euros | Assets | |
|---|---|---|
| 30 June 2024 | 31 Dec. 2023 | |
| Operating segments | ||
| - Gasunie Transport Services | 6,551.3 | 6,540.1 |
| - Gasunie Deutschland | 1,905.7 | 1,846.4 |
| - Participations | 1,570.7 | 1,436.7 |
| Operating segments total | 10,027.7 | 9,823.2 |
| Unallocated assets | 1,153.5 | 1,195.3 |
| Total assets | 11,181.2 | 11,018.5 |
The main investments are described in Note 4 ‘Tangible fixed assets’. Unallocated assets comprise deferred tax assets, the derivative financial instruments and current assets.
3. Revenue recognition
Consolidated net revenue (excluding other revenue) fell by 38.2% compared to the first half of 2023 (first half of 2023: increase of 23.0%). In addition to Note 2 ‘Financial information by operating segment’, we provide further details and analysis of our revenue and revenue development below.
Information about operating activities
We categorise our revenue according to the way in which economic factors influence the nature, amount, timing and uncertainty of the cash flows. A distinction can be made between two categories in the case of Gasunie. The first revenue stream is revenue from regulated transmission and related services, as generated by the Gasunie Transport Services and Gasunie Deutschland business units. The Dutch and German regulatory authorities set the permitted revenue (revenue cap) for this revenue stream for the long term.
The second revenue stream is generated through non-regulated services and/or those fully or partially exempt from regulation. Income from these services is determined by the market forces of supply and demand. Revenue from the non-regulated services and/or those fully or partially exempt from regulation is almost completely generated by the Participations business unit.
Revenue for each operating activity is as follows:
| In millions of euros | Net revenue | |
|---|---|---|
| First half-year of 2024 | First half-year of 2023 | |
| Regulated services | 582.2 | 894.6 |
| Non-regulated and/or exempt services | 99.6 | 207.5 |
| Total net revenue | 681.8 | 1,102.1 |
The decline in non-regulated and/or fully or partially exempt revenue can mainly be explained by the change as of 1 October 2023 in how EemsEnergyTerminal is recognised in the accounts, as explained in Note 1 ‘Significant matters and significant transactions in the first half of 2024’ and Note 2 ‘Financial information by operating segment’. These notes also explain the decrease in regulated services revenue.
Information on products and services
Looking at revenue, we can divide this into revenue from gas transmission and transport and related services and revenue from other activities. Gas transmission and related services covers revenue from regulated gas transmission and from non-regulated or fully or partially exempt gas transmission and transport. Revenue from other activities includes revenue from gas storage and from the provision of other services to third parties.
The breakdown is as follows:
| In millions of euros | Net revenue | |
|---|---|---|
| First half-year of 2024 | First half-year of 2023 | |
| Gas transport and related services | 622.0 | 927.9 |
| Other services | 59.8 | 174.2 |
| Total net revenue | 681.8 | 1,102.1 |
The decline in non-regulated and/or fully or partially exempt revenue can mainly be explained by the change as of 1 October 2023 in how EemsEnergyTerminal is recognised in the accounts, as explained in Note 1 ‘Significant matters and significant transactions in the first half of 2024’ and Note 2 ‘Financial information by operating segment’. These notes also explain the decrease in revenue from gas transmission and transport and related services.
Geographical information
We determine revenue per geographical area based on the area where the activities take place (in or outside the Netherlands). The geographical distribution of the revenue is as follows:
| In millions of euros | Net revenue | |
|---|---|---|
| First half-year of 2024 | First half-year of 2023 | |
| Netherlands | 514.9 | 837.4 |
| Outside the Netherlands | 166.9 | 264.7 |
| Total net revenue | 681.8 | 1,102.1 |
4. Tangible fixed assets
Investments
Investments in tangible fixed assets in the first half of 2024, not including additions on account of right-of-use assets, represented a total value of € 258.3 million (first half of 2023: € 269.6 million). The investments mainly concern the construction of the GTS nitrogen plant in Zuidbroek, the construction of the connector pipelines for the LNG terminals in Stade and Brunsbüttel (both in Germany), the construction of the WarmtelinQ heat supply pipeline, and the initial investments in the hydrogen network in the Netherlands.
Gasunie entered into conditional investment obligations to the tune of € 223.6 million as of 30 June 2024 (year-end 2023: € 248.0 million). The commitments in the Netherlands mainly relate to initial investments in the hydrogen network, investments for the construction of the WarmtelinQ heat supply pipeline, and commitments we have entered into as a shareholder for our joint venture Porthos.
In Germany, the commitments mainly concern regular replacement and expansion investments, the construction of the connector pipeline for the LNG terminals in Stade and Brunsbüttel, and the initial investments in the German hydrogen network.
Depreciation costs
Depreciation costs fell from € 210.4 million in the first half of 2023 to € 161.2 million in the first half of 2024. This can be explained almost entirely by the change as of 1 October 2023 in how EemsEnergyTerminal is recognised in the accounts, as explained in Note 1 ‘Significant matters and significant transactions in the first half of 2024’. Adjusted for the effect of EemsEnergyTerminal no longer being consolidated in the accounts, depreciation costs increased slightly in the first half of 2024 compared to the same period in 2023.
Impairment of fixed assets
At the end of each reporting period, we determine whether there are any events or indications for impairment of fixed assets and we investigate whether there are reasons to reverse previously recognised impairments.
We have identified the following cash generating units:
- gas transmission network in the Netherlands
- gas transmission network in Germany
- BBL Company gas transport network
- EnergyStock underground gas storage facility
- other tangible and financial fixed assets.
Our assessment has not revealed any indication of impairment (or, where applicable, a reversal of a previously recognised impairment) of the fixed assets as at 30 June 2024.
5. Investments in joint ventures
The movements in joint ventures over the first half of 2024 were as follows:
| In millions of euros | First half-year of 2024 | 2023 |
|---|---|---|
| Balance as at 1 January | 483.9 | 371.9 |
| Reclassification EemsEnergyTerminal from group companies to joint venture | - | 27.8 |
| Investments | 38.6 | 101.5 |
| Disposal of German LNG | - | -14.9 |
| Changes in equity | 2.6 | -1.1 |
| Result from joint ventures | 22.3 | 38.0 |
| Dividend received | -13.8 | -39.3 |
| Closing balance as at 30 June and 31 December respectively | 533.6 | 483.9 |
| Loans to joint ventures | 28.4 | 4.4 |
| Total investments in joint ventures as at 30 June and 31 December respectively | 562.0 | 488.3 |
The investments in the first half of 2024 mainly concerned investments in Gate terminal and Porthos.
The direct movements in equity referred to the remeasurement of our interest in Gate terminal as a consequence of the change in fair value of the effective part of one of Gate terminal’s cash flow hedges. Gasunie has recognised this change in equity in other comprehensive income.
The loans to joint ventures concern our shareholder loans to EemsEnergyTerminal and VertiCer.
6. Interest-bearing loans
On 30 June 2024, the nominal amount of € 3,590.0 million (year-end 2023: € 3,090.0 million) in long-term loans comprised € 3,050.0 million (year-end 2023: € 2,550.0 million) in bond loans and € 540.0 million (year-end 2023: € 540.0 million) in private loans. The transaction costs and discount still to be amortised amounted to € 15.4 million (year-end 2023: € 14.5 million).
Movements in interest-bearing loans are as follows:
| In millions of euros | First half-year of 2024 | 2023 |
|---|---|---|
| Principal amount as at 1 January | 3,090.0 | 3,015.0 |
| Total repayments as at 1 January | - | - |
| Remaining principal amount as at 1 January | 3,090.0 | 3,015.0 |
| Costs and discounts on loans to be amortised | -14.5 | -14.5 |
| Balance as at 1 January | 3,075.5 | 3,000.5 |
| Movements in the first half-year and the financial year respectively | ||
| Repayments | - | -225.0 |
| Loans and bonds issued | 500.0 | 300.0 |
| Amortisation of costs and discounts on loans | 0.9 | 1.6 |
| Addition of costs and discounts | -1.8 | -1.6 |
| Total movements in the first half-year and the financial year respectively | 499.1 | 75.0 |
| Principal amount as at 30 June and 31 December respectively | 3,590.0 | 3,090.0 |
| Total repayment as at 30 June and 31 December respectively | - | - |
| Remaining principal amount as at 30 June and 31 December respectively | 3,590.0 | 3,090.0 |
| Costs and discounts on loans to be amortised | -15.4 | -14.5 |
| Balance as at 30 June and 31 December respectively | 3,574.6 | 3,075.5 |
| Included under current liabilities | -175.0 | -175.0 |
| Total | 3,399.6 | 2,900.5 |
In April 2024 we issued our new green bond for an amount of € 500.0 million and with an agreed term of 20 years. This bond will be repaid in a lump sum at the end of the term. The bond has been placed under Gasunie’s Green Financing Framework and, as a result, we must fully allocate the proceeds from this bond to our ‘green’ spending. Our Framework complies with the International Capital Markets Association (ICMA) Green Bond Principles and the European Green Bond Standard (EU GBS), which means that this bond also has the EU GBS label. The effective coupon rate is 3.88% and is fixed for the entire term. After deducting € 1.8 million in discount and transaction costs, € 498.2 million was received. This amount is also included in the condensed consolidated cash flow statement.
N.V. Nederlandse Gasunie provided no security to its credit providers for the interest-bearing loans or other facilities. The existing loan conditions remained unchanged compared to year-end 2023.
The repayment schedule is as follows:
| In millions of euros | First half-year | Second half-year | Total |
|---|---|---|---|
| Repayment in | |||
| 2024 | 175.0 | 175.0 | |
| 2025 | - | 125.0 | 125.0 |
| 2026 | 650.0 | - | 650.0 |
| 2027 | - | - | - |
| 2028 | - | 300.0 | 300.0 |
| na 2028 | 2,340.0 | ||
| Total repayment obligations | 3,590.0 |
The company has a non-committed overdraft facility of € 25.0 million (year-end 2023: € 45.0 million), a committed credit facility of € 1,050.0 million (year-end 2023: € 600.0 million), a € 750.0 million Euro Commercial Paper (ECP) programme (year-end 2023: € 750.0 million) and a € 7.5 billion Euro Medium Term Note (EMTN) programme (year-end 2023: € 7.5 billion). The committed credit facility runs until April 2027. Over the past six months, no funds have been drawn on the committed credit facility or under the ECP programme (first half of 2023: the same). We may also occasionally raise other short-term loans on the money market, though we did not do so in the first half of 2024 (first half of 2023: withdrawal and redemption of € 215.0 million).
Under the EMTN programme, € 3,050.0 million was issued in bond loans as at 30 June 2024 (year-end 2023: € 2,550.0 million). The base prospectus of the EMTN programme is valid until 31 October 2024 and is expected to be updated in the second half of 2024.
The long and short-term credit ratings by S&P did not change over the first half of 2024. On 5 July 2024, Moody’s downgraded its long-term credit rating for Gasunie from A1 to A2 with a stable outlook. The short-term credit rating remains unchanged. Moody’s anticipates that we will no longer be able to stay within its tolerance level for an A1 rating for the long term, specifically in terms of the ratio between operating result and net debt. This is mainly due to the expected increase in long-term debts, related to the forecast investments in the energy transition. The operating result is also temporarily lower, partly as a result of the settlement of the surplus revenue from the 2022 financial year, resulting in lower permitted revenue in the regulated segment, as explained in Note 1 ‘Significant matters and significant transactions in the first half of 2024’ and Note 2 ‘Financial information by operating segment’.
7. Financial instruments
The following financial instruments are recognised in these interim financial statements:
- other equity interests
- derivative financial instruments
- interest-bearing loans
- other primary financial instruments.
Gasunie uses the following hierarchy of measurement methods to determine the fair value of financial instruments:
| Level 1: | Based on quoted prices on active markets for the same instrument. |
| Level 2: | Based on prices on active markets for comparable instruments, or based on other valuation methods, with all required key data being derived directly or indirectly from publicly available market information. |
| Level 3: | Based on measurement methods, with all the required key data not being derived from publicly available market information. |
Other equity interests
The other equity interests are as follows:
| Company name | Registered office | Interest | |
|---|---|---|---|
| 30 June 2024 | 31 Dec. 2023 | ||
| Energie Data Services Nederland (EDSN) B.V. | Arnhem | 12.5% | 12.5% |
| Nord Stream AG | Zug, Zwitserland | 9.0% | 9.0% |
| PRISMA European Capacity Platform GmbH | Leipzig, Duitsland | 12.8% | 12.8% |
| SCW Systems B.V. | Schoorl | 4.2% | 4.7% |
The fair value of the other equity interests was € 7.0 million as at 30 June 2024 (year-end 2023: € 7.0 million). This is a level 3 fair value measurement (year-end 2023: level 3). The assumption for the interests in PRISMA, EDSN and SCW Systems is that, partly on account of their relatively small size, the carrying amount is an estimate of the fair value. For Nord Stream, we maintain our fair value measurement of € zero as at 30 June 2024 (year-end 2023: € zero). In the first half of 2024, regarding the valuation of our interest in Nord Stream, no facts or circumstances have come to our attention which provided significantly different information about the assumptions and estimates as at year-end 2023.
The decrease in our interest in SCW Systems is related to the fact that not all shareholders participate pro rata in additional capital contributions.
Derivative financial instruments
The derivative financial instruments are forward exchange contracts and gas price swaps.
The forward exchange contracts were concluded by N.V. Nederlandse Gasunie to facilitate currency risk management by our joint venture EemsEnergyTerminal. EemsEnergyTerminal is chartering two FSRUs, for which the lease is denominated in US dollars. N.V. Nederlandse Gasunie has concluded a contract with EemsEnergyTerminal under which changes in the value of the forward exchange contracts that have not yet been settled and the actual settlement of the settled forward exchange transactions are fully settled with EemsEnergyTerminal. This contract itself also qualifies as a financial instrument under IFRS 9. As a result, on balance this has no effect on the net result of N.V. Nederlandse Gasunie.
We determine the fair value of the forward exchange contracts based on the present value of projected future cash flows. For this purpose, we make use of forward exchange rates with a comparable term and a zero-coupon discount rate that matches the currency and the term of the transactions, taking into account Gasunie’s credit risk and that of the relevant counterparties. This is a level 2 fair value measurement (year-end 2023: level 2). As at 30 June 2024, the fair value of the forward exchange contracts was, on balance, zero (year-end 2023: on balance zero). Without netting, the fair value of the forward exchange contracts as at 30 June 2024 was € 0.3 million. At year-end 2023, the fair value was € 6.9 million.
Gasunie has entered into investment obligations in a joint venture, the amount of which may vary depending on gas price developments. To limit the cash flow risk on these expected capital expenditures, we use gas price swaps, this way effectively fixing the future variable investment obligation – in terms of our share in this investment obligation – over the term of the investment obligation (until 31 December 2027).
We determine the fair value of the gas price swap based on the present value of quoted commodity prices for gas price swaps. For this purpose, we made use of the closing prices for gas forward products with a comparable term and a zero-coupon discount rate that matches the term of the transactions, taking into account Gasunie’s credit risk and that of the relevant counterparties. This is a level 2 fair value measurement (year-end 2023: level 2). As at 30 June 2024, the fair value of the gas price swap was € 17.2 million negative (year-end 2023: € 19.3 million negative).
Interest-bearing loans
The interest-bearing loans comprise bond loans with a listing on the Amsterdam stock exchange, and private loans.
The fair value of listed bonds is the same as the year-end exit price. This is a level 1 fair value measurement (year-end 2023: level 1). The fair value of the private loans has been determined by calculating the present value of the expected future cash flows at a discount rate equal to the applicable risk-free market interest for the remaining term, plus credit and liquidity surcharges. Account has been taken of the company’s risk profile. This is a level 2 fair value measurement (year-end 2023: level 2).
The carrying amount and the fair value of the interest-bearing loans as at 30 June 2024 were:
| In millions of euros | 30 June 2024 | 31 Dec. 2023 | ||||
|---|---|---|---|---|---|---|
| Carrying amount | Fair value | Difference | Carrying amount | Fair value | Difference | |
| Bonds | 3,034.6 | 2,812.9 | -221.7 | 2,535.5 | 2,364.5 | -171.0 |
| Private loans | 540.0 | 500.0 | -40.0 | 540.0 | 511.5 | -28.5 |
| Total interest-bearing loans | 3,574.6 | 3,312.9 | -261.7 | 3,075.5 | 2,876.0 | -199.5 |
The change in fair value of the loans in the first half of 2024 is mainly the result of changes in market interest, on average shorter remaining repayment terms of the loans and the effect of interest additions or payments. In the period after the balance sheet date our long-term credit rating was downgraded, as explained in note 6 ‘Interest-bearing loans’. This downgrade had no significant consequences for the fair value of the interest-bearing loans in the period from the balance sheet date to the date when the financial statements were prepared.
Other primary financial instruments
Other primary financial instruments comprise trade and other receivables, cash and cash equivalents (presented under current assets in these interim financial statements), current financing liabilities (excluding current repayment obligations on long-term loans), trade and other payables. Given the short term of these instruments, their carrying amount approximates their fair value.
The balance of cash and cash equivalents as part of current assets was € 517.8 million as at 30 June 2024 (year-end 2023: € 294.7 million).
8. Events after the balance sheet date
No significant events occurred after the balance sheet date that have to be recognised or explained in the interim financial statements.