Current Report No. 22/2017

Date of preparation: 22 May 2017

Subject: ENERGA SA Management Board’s recommendation on the dividend payment

Legal basis: Article 17 Section 1 of the Market Abuse Regulation – confidential information 

The Management Board of ENERGA SA (“Company”) reports that on 22 May 2017 it adopted a resolution on the distribution of net profit for the 2016 financial year.

The Company’s Management Board recommends to the Shareholder Meeting the following distribution of net profit for 2016 in the amount of PLN 783,542,643.96:

1)         payment of a dividend to shareholders in the amount of PLN 78,672,751.66, i.e. PLN 0.19 per share (10% of profit),

2)          designation of profit in the amount of PLN 704,869,892.30  to supplementary capital (90% of profit).

The above proposal regarding dividend payment results from an analysis of the Company’s financial standing, observation of the changing market and regulatory environment and taking into consideration the ENERGA Group’s current and planned investments. In the Company’s opinion, the payment of the dividend will not exert negative influence on the ENERGA Group’s financial and liquidity position, its ability to execute its current investment plans and the ENERGA Group’s growth strategy in accordance with its assumptions.

According to Article 396 § 1 of the Commercial Companies Code, the Company is obligated to form supplementary capital and allocate at least 8% of its profit for a given financial year until such time that it becomes equal to one-third of share capital (that means the amount of PLN 1,507,204,294.96 for ENERGA SA). As at 31 December 2016, it is PLN 728,047,318.80, i.e.16.1% of share capital, while upon incorporating the proposed distribution of profit, it will be 1,432,917,211.10, or 31.7% of share capital (i.e. 95.1% of the required amount).