Hello, ladies and gentlemen. Thank you for joining. My name is Laura Korjus and I am the Head of Communication in Tallinna Vesi. I welcome you all to Tallinna Vesi's webinar. This webinar will be hosted by Aleksandr Timofejev, Chief Executive Officer, and Kristi Ojakäär , Chief Financial Officer. Firstly, the presenters will introduce the highlights of the second quarter, give an overview about COVID-19's impact on Tallinna Vesi. Aleksandr will also speak about Tallinna Vesi's operational results, and Kristi will speak about financial results of the second quarter of the year. Aleksandr will also give an overview about some of the investments made in the first six months of the year. Right after the presentation, you will have an opportunity to ask questions. It is also possible to type in your question during the presentation, but these will be answered in the end part of the webinar.
To submit your questions, please use the question box on the right side of the screen. Now I will give it over to Aleksandr and Kristi. Here you go.
Thank you, Laura. Good morning, everyone. I'm happy to welcome you today here. Already in May, I took on a new role as the CEO of the company. I have worked in Tallinna Vesi for the last 13 years, and I believe that Tallinna Vesi is a strong and stable company, continuing to grow and develop. I would also like to thank all investors who see the company's value and contribute to its growth together with our team. There is still one vacant position in the management board, and the recruitment of a third management board member is ongoing. The value of a company is illustrated by Tallinna Vesi's stable dividends policy. In the second quarter, we paid dividends to our investors in the amount of EUR 0.65 per share. Also, we are in the process of planning various cooperation projects together with Utilitas and the City of Tallinn.
It is too early to speak about certain projects at the moment, but we will keep all our investors informed about important news. I will give also a light overview about COVID-19 and impact of that on the company. Since the beginning of autumn, the company's working arrangements were influenced by the spread of coronavirus. As the situation improved in summer, we moved back to usual working arrangements. Our office staff still have the option to do remote or hybrid work from home. As Tallinna Vesi offers vital services, we are being cautious and monitor the situation in Estonia all the time, and we are ready to change the working arrangements when it's necessary. We can say that all the planned investments have been made and all deliveries are on schedule.
If we speak a little bit about finance, then the consumption has increased in commercial sector compared to the second quarter of 2020 due to losing COVID-19 restrictions. Private customers consumption has decreased slightly, mainly to lower consumption in apartment blocks. Of course, we expect a slight increase in the consumption of our water services in the next quarters. Operations, very important for us, and I will give also an overview about the performance of the second quarter. The results were actually covered in our TSC last Wednesday, but I will go a little bit in details during that presentation as well. We are pleased to see consistently high performance in the quality of our service, although some results are not as perfect as in 2020 due different weather conditions this year. If we speak about water quality, then we monitor our water quality all the time.
If we speak about the second quarter, then we took almost 1,600 samples from the taps of our customers. The quality of tap water was very good in the second quarter, and the result that was achieved was 99.7% of the samples. Hot weather in summer can be a challenge to us and in terms of ensuring water quality in the water network. To make sure that our consumers have high-quality drinking water at their taps all the time, we carry out proactive maintenance of the water network. If we speak about the treated wastewater, then in addition to that, we also monitor constantly the concentration of pollutants in the incoming wastewater and the final treated effluent of the Paljassaare Wastewater Treatment Plant, which has a direct impact on the marine environment. During the first six months, the effluent continued to be fully compliant with all regulations and standards.
Customers are very important for us as well as we offer our services to almost 500,000 of people. Our goal is to deliver high quality service to our consumers. In the second quarter, our customer satisfaction was much higher than usually, and it was 4.3 points. This shows a positive trend in our customer satisfaction with the customer service we provide. To maintain customer satisfaction, we have set ourselves clear and forward-looking targets. We have seen a gradual decline in the number of complaints that are related to the customers. That's a positive trend and serves as an indicator to stable improvements in the quality of services we provide. The leakage rate during last six months was 15%. Being higher than during the same period last year.
As I mentioned before, the extreme weather conditions this year, really strong and cold winter and very hot summer, definitely impacted also the performance of our water network. If we speak about the water interruptions, then we can say that water interruptions are not really long in Tallinn. If we speak about last quarter, then the average water interruption was two hours and 51 minutes. That is less than the interruptions that we had during the same period last year. To minimize the effect of water interruptions on customers, we as a company plan all the time to install additional valves that will help us in the future to minimize the number of customers who are impacted by the water interruptions. We also rehabilitate all the time our networks. This should help us to improve the services we offer to our customers year-on-year.
This year, we already rehabilitated our networks in Poška, Roosikrantsi, and Kadaka streets. During first six months of the year, we built 4.2 km of water pipes and 1.1 km of sewage. If we speak about investments, we have to mark that we constantly put in effort to improve our service. In the first six months of the year, we carried out investment projects for the amount of EUR 4.1 million. We made investments into an effort to secure uninterrupted service and reliability of water supply to consumers, such as reconstructing water pipes and sewers, and installing additional valves and hydrants into the network. We also make investments into our water and wastewater treatment plants. One of the largest project of a decade is the reconstructing of the mechanical treatment stage at Paljassaare Wastewater Treatment Plant.
Construction works are almost completed, and the testing at the moment is ongoing, and we plan to fully take the system into the operation in August. One of the biggest investments for the water supply this year is the renovation of Ülemiste Pumping Station, which is an important part of the water network. This pumping station pumps drinking water to large amount of Tallinners and nearby municipalities. Capital investments into the network ensure uninterrupted water and wastewater services and the reliability of water supply to customers also in the future. Now I will give over to Kristi, who will share the detailed information about the finance with you. Thank you.
Thank you, Aleksandr. With the following, I would like to give you the overview of the financial performance of Tallinna Vesi in the second quarter of 2021. The ongoing coronavirus pandemic continues to impact economic environment and our results, despite easement of restrictions in spring. In the second quarter of 2021, after lifting restrictions, the consumption of commercial clients started to pick up again. We are optimistic that the consumption will revert to pre-pandemic volumes, in the longer term. Compared to the second quarter in 2020, the total sales revenues increased by 7.3%, amounting to EUR 12.97 million. The sales of water services increased by 3.5% or EUR 0.4 million, and the construction services by 33.8% or EUR 0.4 million. The gross profit for the second quarter this year was EUR 5.2 million, which was higher by 10.5% or EUR 0.5 million compared to the same period in 2020.
The gross profit was mainly impacted by higher water services revenues. In the second quarter of this year, the operating profit was EUR 5.2 million or EUR 0.6 million higher than in the same period in 2020. It was mainly impacted by changes in the gross profit. Operating profit in first quarter in 2021 was also affected by a reduction in the provision fund for the possible third-party claims in the amount of EUR 1.2 million, which is the same amount as in the last year. Compared to the second quarter in 2020, the net profit of the company was EUR 2.9 million higher, being impacted by EUR 2.3 million lower income tax and dividends and changes in operating profit. On the next slide, I will comment on the changes in revenues and expenses in more detail.
Total sales revenues for the second quarter of 2021 increased by 7.3%, amounting to EUR 13 million. Total revenues from water services were by 3.5% or EUR 0.4 million higher than in the second quarter of last year, amounting to EUR 11.2 million. The increase in water services revenues were mainly driven by changes in the consumption. The private customers' revenues in main services area decreased compared to the same period last year by 0.9% to EUR 5.1 million, driven mainly by 0.5% lower consumption by apartment blocks. Lower consumption of private customers was mainly related to easement of restrictions at the end of April, as people were returning from working remotely to working at offices. The commercial customers' revenues in main services area increased compared to the same period in 2020 by 17.2% to EUR 3.5 million, driven by an average 17.2% increase in consumption.
The sales to commercial customers were impacted as well by the relaxation of pandemic as hotels and spas and entertainment facilities were opened in June, and less people were working at home. Outside service area revenues increased by 8.5%, amounting to EUR 1.3 million. The change was mainly driven by higher consumption of water supply and wastewater disposal services. Storm water revenues from the main service area were lower by 18.7%, amounting to EUR 1 million in the second quarter of this year, driven by 7.2% higher storm water volumes, which was balanced by lower cost per cubic meter.
The revenues from the construction services showed an increase of 33.8%, or EUR 0.4 million compared to the second quarter in 2020, and amounted to EUR 1.6 million. The increase was related to higher pipe and road construction services revenues, impacted mainly by projects won from market in Tallinn and surrounding municipalities.
This now takes us to the costs. The total cost of goods sold increased by 5.2%, or EUR 382,000 in second quarter of 2021, amounting to EUR 7.7 million. Total direct production costs increased by 7.1%, or EUR 122,000, mostly due to higher electricity and chemical costs. Electricity costs increased by 11.9%, mainly due to nearly 5% higher electricity price. Chemical cost increased by 7.3%, driven mainly by an average 70% higher price of methanol. At the same time, 26% lower usage of methanol in wastewater treatment process. construction services costs increased by 34.8% to EUR 1.3 million and were related to higher construction services revenues mentioned earlier. Other cost of goods sold decreased by 7.9% to EUR 1.4 million and related to timing of asset maintenance costs. Administrative and marketing costs decreased by 17.1%, or EUR 226,000, amounting to EUR 1.1 million, related to less professional services bought.
Other net income and expenses amounted to net income of EUR 1.1 million compared to the net income of EUR 1.2 million in the comparative period, being driven from higher revenues from connection fees and higher expense of expected credit losses. The net income was mostly impacted by EUR 1.2 million decrease in provision formed for the possible third-party claims in the second quarter of 2021, which is at the same amount as in last year. Let's move on to the cash flows. As of end of June, the company cash balance stood at EUR 37 million, forming nearly 15% of the total assets. Compared to the end of last quarter, the cash balance has decreased by EUR 10.1 million by the end of second quarter as a result of dividend payout at end of June.
The largest contribution to the cash flows comes from the main operations during six months of 2021. Total operational cash flow amounted to EUR 11.4 million. The company's collection of receivables continues to be high, being on a 99.8% level on average. The net cash flows from investing activities during the six months of 2021 resulted the cash outflow of EUR 3.7 million, which is EUR 1 million less than in the same period last year. Investments into fixed assets have been EUR 5.1 million, and the compensation received for the construction of pipes and connection points were EUR 1.4 million. The company's financing cash outflow during six months of 2021 were of EUR 15.2 million. Compared to last year's same period, cash flow decreased by EUR 7.2 million, mainly related to lower dividend and interest payments.
Now I'm giving the floor back to Aleksandr, who makes a summary about 2021 for AS Tallinna Vesi.
Now we will actually move to questions. We have some questions sent in already, but we will also give you some minutes to submit your questions. Please feel free to type in this in the question box. Thank you for the questions. We will proceed with these in the order they have been received. The first three questions are from Max Rishin. The first question is: Could you provide some color on the direction of the future tariff increases? There was a substantial CapEx in both 2020 and 2021. Does this CapEx impact the future tariff policy in any way? Kristi, please.
All the latest investments are in line with the existing tariff, which is fixed by Estonian Competition Authority. Future investments might impact the water tariff, but it is too early to predict the future changes. As a reminder, we had our tariff approved at the end of 2019, and currently, we do not foresee a need for a new application in the near future.
Mm-hmm. Thank you. The next question is: Are there plans to improve ESG ranking by providing minority shareholders with a seat on the board, as well as establishing a KPI related specifically to environmental impact? Aleksandr, please.
Thank you. Tallinna Vesi is a responsible company. We take a lot of environmental resources to our processes to treat water and, of course, we're all the time dealing with that. We have special requirements in the company that are related to the environment, and we all the time prepare for ourself new objectives year- on- year that are related to the environment. Of course, we do not stay on the same place, and we're all the time trying to think how we can do our work efficiently and what we can do to reduce our footprint. If we speak about the board member position, as I mentioned in the presentation, then at the moment, this is the vacant position, and I think already in August it will be possible to apply for this job.
Definitely we will try to find the best person who can help company to achieve our objectives and to bring the best value to the shareholders. Thank you.
The third question from Max Rishin is: Could you describe long-term plans for ASTV Green Energy subsidiary? Aleksandr, please.
At the moment, I do not really want to speak in details about the green energy. This is the fact that the company owns the green energy subsidiary, and we have some opportunities at the moment already at the wastewater treatment plant, how to deal with the biogas that we produce in there. These opportunities are different. We can deal with the biomethane, or we can deal with the energy production. At the moment, there is not any decisions taken what strategy the company will take. But at the moment, we're really hardly working on that. I think that when the decision will be taken, and then we will exactly understand what is the right direction for Tallinna Vesi, then we'll share the information with our shareholders. Thank you.
Thank you, Aleksandr, and thank you for the questions. We will give you now two more minutes to type in your questions. Seems like we don't have any more questions, and the recording of the presentation will be available in the Nasdaq Baltic YouTube channel webinar playlist shortly. Presentation materials and reports can be found on Tallinna Vesi's webpage. Kristi and Aleksandr, thank you for the overview, and thank you for participants for joining. Have a good day.