Good morning. Dear listeners, welcome to Klaipėdos Nafta Meeting with Investors. I'm Emilija Ivanauskaitė from Nasdaq Vilnius, and I'll be moderating today's event. We will start with a presentation from the management, which will be followed by the Q&A session. Please be informed that this webinar is being recorded. As always, I encourage every one of you to ask questions during or after the presentation in the Q&A section. With that said, I'm pleased to introduce today's presenters, Chief Executive Officer, Darius Šilenskis, and Chief Financial Officer, Mindaugas Kvekšas. Gentlemen, please, the floor is yours, and good luck.
Good morning, Emilia. Good morning, everybody who has joined today for our regular webinar. The content of today's presentation remains the same as usual. We will present key highlights, main business, or short, let's say, brief businesses overview, and of course, financial results. I will start from the highlights, which comes from our Q2 of 2022. First of all, many changes in our regulated activity segment, and as you are probably aware, our FSRU is now one of the most demanded and wanted infrastructural terminals across Europe. Why?
Because from first of May, this terminal is completely covering all the demand in Baltics and some of the demand as well in Poland after the, let's say, cease of the gas supplies from Russia, from the Gazprom pipeline. Key highlights out of this segment are that, let's say existing discount for the regas services has been, let's say, canceled and rates for regasification become EUR 1.41 per MWh. Another important news and message is that the regulator approved almost the same weighted average cost of capital rate for the following year. Why it is so important?
Because this rate defines the level of the return and level of the profit which stays in the company from this activity. As I mentioned, after the war began, all the demand in our region is, let's say, supplied through our FSRU. We of course have, let's say, less to offer than market wants. Therefore, we started technical infrastructure studies in order to evaluate technical and other capabilities to expand existing regasification possibilities in FSRU Independence. We are working closely both with FSRU owner, with Höegh, as well with national grid operator, Amber Grid, since increase of the capacities is related as well with some, let's say, some additional works to be done in the grid as well.
Talking about business development, small but important step from our side, in renewable energy generation supply and logistics chain. Just recently, we have signed a MOU with ORLEN Group's company responsible for the renewable energy development. The idea of this MOU is to cooperate in a provision of operation and maintenance services for wind farms in the Baltic Sea. Of course, at first, we are looking to be a part of, let's say, generation and value chain for Lithuanian offshore wind farm, which is planned to be built starting 2027.
This cooperation gives as well opportunities to look a bit wider, at least to entire Baltic Basin and participate in all possible tenders for O&M services for offshore wind generation. Talking about financial performance, I won't go into very detailed level because Mindaugas will present it later. In general, first half of 2021 was better in terms of EBITDA for entire group and as well in our oil segment. Yes, we have generated more revenue compared to the same period last year. Few reasons, of course, as I told, maximum or full utilization of FSRU starting first of May. We're operating on 100%.
Of course, let's say, attraction of additional flows, continuing diversification in our oil segment, in our oil terminals, brought in some additional benefit and some additional returns. Talking about other news, we had a very great event in Klaipėda, connecting all the region's players in LNG industry. Yes, we had, let's say, anniversary, I mean, 13th loading operation in our FSRU, and it's one more important thing to say that this terminal is operating without any accidents from the very first day we started. Presently, selection of supervisory council is going on. I would like to remind that KN has a two-tier corporate governance structure.
We just got a new board in action, and now hoping to finalize the supervisory council selection process within upcoming months. We can switch to business overview, and I would like to present a few highlights and few main messages from this segment. As I already mentioned, we had a higher transshipment of biofuels and petrochemicals, meaning continuing diversification. There was no very huge demand for storage service to rent out idle capacities in our oil terminal. Why? Because there was backwardation tendencies continuing in the market. KN become very significant part of bitumen transshipment market, while we already have 26% of entire market in Baltics.
Yes, we had some more activities on imports of mainly light products, and some of those are dedicated as well for Ukrainian market. Talking about LNG or regulated LNG activities. On average, our FSRU was utilized 59%, which was significantly almost 50% more comparing to previous period or previous year. But it's worth to say that, beginning of the year, before the war, utilization of this terminal was really minimum, reaching only about 20%. Why? Because TTF, or LNG and gas prices, reached record levels and, let's say LNG was not so highly demanded.
After the war started and the FSRU Independence becoming the only one of the main entry gates for natural gas, of course those utilization rates went up and reached from the beginning of May, 100% of all the technological capacities which we operate. Comparing to other terminals in Europe, we are quite close. Let's say the average was 61%, so ours was 59%. Talking about capacity allocation, many things has changed in the last quarter. We got new regulations approved by the regulator, which allows to conclude or let's say to do reservation of two-thirds the capacities up to 10 years.
This was quite a complicated and intense process in terms of calibrating everybody's needs, collecting the, let's say, opinions and proposals from the market and calibrating them with the regulator. We are hoping that this process will end up quite soon. We will be inviting all the market players, those who have agreements for usage of the capacities. We will invite everybody to participate in this capacity allocation process, which will start on 15 September 2022. For this gas year, I think we already mentioned all the possible and available capacities of FSRU are already booked. This is the main messages about the business overview. I'm passing back microphone to Mindaugas.
Thank you, Darius. Good morning, dear participants. I'll go into more detail in respect of financial performance of KN company group during the first half of 2022. Despite worsening situation with wholesale gas and electricity prices, especially as we have seen in the Q2 of the year and seeing now in Q3 also, has brought a solid improvement in financial performance both in comparison with the respective quarter of previous year and also in comparison to Q1 of this year. You might remember that during our last webinar we highlighted that we are seeing a positive trend in recovering financial performance.
We are happy to see that this trend is or has been continuing in the Q2 of the year. However, we are cautious that recent eruption of record high energy prices, if prolonged, it could significantly affect the company's performance in the second half of this year, as indicated by prices of futures contracts for gas and electricity for the remainder of the year and even in the upcoming future, starting from 2023 onwards. In respect of revenue, and here in this slide, I will mainly focus and mainly highlight the comparison of current year versus year 2021. Revenue was up by EUR 4.4 million.
Almost EUR 1 million of additional or more revenue comes from an oil terminal segment as transshipped volumes have increased by 22% driven by recovered demand for oil products, as mentioned by Darius. Another almost EUR 4 million are coming from regulated revenues from LNG terminal segment. The key factor for jump in revenue was a significant increase in demand for regasification services in the terminal and a change in regulation. This year we have seen quite many substantial changes in the regulations that will affect terminal's performance in 2022 and 2023. The latter, meaning these changes in regulations, led to an increase in regasification tariff by nearly 3x.
However, since May, a fixed part of regasification service fee, which was part of security supplement paid by gas consumers, has been reduced to zero. Subsequently, because of these two conditions, increase in demand and changes in the regulations, revenue increased by EUR 2.3 million. The remaining part of increase in revenue was driven by more one-off events. On the other hand, it is important to note that the company's profit from regulated business remains limited to regulated rate of return and temporary excess profits, according to current regulations, shall be paid back in future periods. In terms of EBITDA, it was up by EUR 2.7 million.
Of that, approximately 300,000 were coming from oil segment, achieved by growth in the revenue and effective management of fixed costs despite great inflationary pressures. Electricity and the gas costs were higher by approximately 2.3x, which is around EUR 1.5 million in comparison to last year. Despite the measures in respect of energy efficiency that we have implemented, the significantly higher prices unfortunately had a significant impact on our variable costs. The EUR 2.6 million as an improvement in EBITDA in comparison to last year was coming from the regulated segment, mostly due to higher revenue as mentioned before.
Key element behind a EUR 1 million increase in costs for the regulated segment was the cost of emission allowances, which are affected by larger regasification volumes and as a result, higher emissions, but more importantly, affected by higher prices of emission allowances, which now have almost reached EUR 100. Performance of the commercial LNG segment remained quite stable at a similar level as in prior year. Net profit and loss. The non-adjusted net loss according to IFRS was again impacted by further depreciation of euro against the United States dollar. We incurred a total unrealized foreign exchange loss of almost EUR 70 million, less deferred taxes.
I will remind that such losses arise from a lease liability for floating storage and regasification unit that is denominated in the United States dollars. Since lease payments are fully compensated by the regulated income either of the current or the future periods, therefore, our approach is not to hedge against this risk in 2022. Which implies that respective compensation should be earned in the future periods following the subsequent realization of these losses, if any. After we eliminate the unrealized currency exchange losses of the regulated segment, its adjusted net profit amounts to EUR 2.5 million, as you can see by comparing the last two charts on the slide. In the previous year, its first half was especially difficult for the oil segment.
However, efforts on recovering the revenue and managing costs has replaced the prior year net loss to a current year net profit of EUR 0.6 million for our oil terminals. We also measure indicators that take into account temporary regulatory differences, such as the previously mentioned excess revenue in the regulated LNG terminal segment that should be paid back in the future periods. Accordingly, in the first half of 2022, EBITDA adjusted for temporary regulatory differences would amount to EUR 16.4 million compared to EUR 14.8 million last year. The similarly adjusted net profit in the first half of this year would amount to EUR 2.7 million compared to just EUR 0.2 million last year. On the free cash flow development.
Last year, we had, for the first half, a free cash flow of nearly EUR 9 million. This year, strong improvement in the group's free cash flow comes from, to the larger extent, by the changes in the working capital, mainly the increase to trade payables amount, and also, as previously mentioned, the tangible growth in the EBITDA across our key two segments. In respect of investments, our key project continuing in 2022 was modernization of jetties in Klaipėda Oil Terminal. Otherwise, in respect of other investment projects, we have applied a rather conservative selection criteria for 2022. We are seeing modest levels of investments in 2022 in response to the turmoil in the markets.
About the leverage metrics, the net debt development, the main changes were an increase in loans taken from the Nordic Investment Bank, and the purpose of these loans is to finance the reduction of the security supplement in the regulated segment. While EUR 26 million of lease liabilities were settled in the first half of 2022, due to depreciation of euro, the remaining balance effectively has not changed and, as it is mostly denominated in the United States dollars. Last, about the other key metrics. We are happy to observe that gross profit margin, EBITDA margin, and net profit margin have all improved this year in comparison to last year. I have already covered the key factors behind that.
It is important to mention that return on equity, return on assets, and the price-earnings ratios are calculated by taking the net result for the last 12 months. Accordingly, they are still affected by the significant impairment losses of the last year. Other than that, as I mentioned, we are happy to conclude that the financial performance in the second quarter of this year was rather positive, and we'll keep on improving in the future in response to the changes in the market. That ends up the financial performance overview, and we are moving to the question and answer session.
Thank you very much for the comprehensive presentation. Indeed, now we are starting the Q&A session. As we're waiting for the questions, I would like to remind everyone that you can send in your questions in the Q&A box on your screen, and the questions can be also sent anonymously. Now let's take a minute to wait for the questions.
Yes. We have received one question which would be as following: Due to Russian energy war on Europe, a lot of countries are trying to develop LNG terminals. Is AB Klaipėdos Nafta planning somehow to capitalize on this trend? Thank you.
Yeah. Thank you for the question. I will take the answer. Sure, because this is our strategy to develop and capitalize our knowhow to our international LNG terminals or projects. Our global business development team definitely is investigating all possible newly appeared opportunities, including Germany and Southern Europe, and other countries. General answer is yes. Whether we are capable to succeed, that is, let's say, competitive activities and services. We will try to do our best and to find another project in Europe.
Thank you very much. As there are no other questions, on behalf of Klaipėdos Nafta and Nasdaq Vilnius, thank you everyone for joining us today. Dear management, thank you very much for the comprehensive presentation. The recording of the webinar, as always, will be available in the Nasdaq Baltic YouTube channel and company's website. Have a good day, everyone, and goodbye.
Thank you, Emilija and all the participants. Goodbye.