Good morning. I would like to welcome you to Klaipėdos Nafta meeting with investors. I'm Emilia, an account manager at Nasdaq Vilnius, and I'm delighted to be the moderator for today's event. We will start with a presentation from the management, which will be followed by the Q&A session. As always, I encourage every one of you to ask questions during or after the presentation in the question box of your screen. With that said, I am pleased to introduce today's presenters, the Chief Executive Officer, Darius Šilenskis, and the Chief Financial Officer, Indrė Kisielienė . Dear management, please, the floor is yours.
Good morning, Emilia. Good morning, investors, and those who have joined today's presentation of KN's first half of the year results.
Good morning, everyone.
As usually, we will start from reminding what is mission and vision of KN group companies. They remain the same. Mission is to ensure safe, reliable, and efficient access to global energy markets by sustainable development, investment, and operation of multifunctional terminals worldwide. Our aim remains to assist our customers on cleaner energy transition and to maintain their competitiveness. Vision as well is still actual and applicable. We would like to become top LNG terminal operator worldwide and the most competitive oil and refined products handling hub in the Baltic region. Next slide. Since we are still in a COVID pandemic threat, and as we can see worldwide, the third or even, in some countries, even fourth wave is rising again with new cases of COVID.
Some company is still maintaining its focus on the health and on the continuity of the businesses and activities in the light of this global challenge. Probably main message which I would like to say today is that company have let's say significant amount of the employees who has got full immunity, and approximately it's about two-thirds, and to be more precise, last week we were checking it's about 76% of those who have both let's say vaccinated and immunity. Of course, COVID pandemics is still affecting, let's say, our mainly oil business because of interruptions in mobility. Let's say refining margins are still not so stable as they used to be before the pandemic times. Talking about the main announcements, I will not read the slide.
I think the main messages are related with the dividends, both what we distributed for the 2020 result and as well latest and freshest news that yesterday the board of the company has approved the renewed dividend policy. For the 2020 result, KN has paid dividend equal to €0.098 per share. Total amount of the dividends distributed to shareholders amounted to €7.5 million. Another important message is to underline that, let's say, our FSRU customers list has been supplemented by one more international company, by one more major company, by Norwegian energy company Equinor ASA. As well, I think it's worth to underline that it's already second time when company prepared social responsibility report for 2020.
Report is prepared following the International Global Reporting Initiative (GRI), and you can find the report either by clicking the link which is here in the presentation or even by visiting our website. Talking about dividend policy, there was a lot of questions during the past few, let's say, webinars. Finally, we have the new version approved and probably main message is that, let's say, dividends for the years 2021 to 2024, is and will be calculated by eliminating from the company's distributable profit unrealized foreign exchange rates impact and other unrealized gains. Talking about the main highlights. First of those highlights in this slide are about, let's say, efficiency and margin protection measures, which company is doing. We are successfully implementing and continuing implementation of the lean method in our processes.
We already, let's say, certified and established three of them: A3, 5S, and Kaizen. Now we are starting to implement Vaka method, which as well will improve our processes and will bring some benefit back to our bottom line. Also, probably this name is not well-known not for industry players and experts. We thought that it's worth to mention that this efficiency improvement, let's say, tools are not limited to what we've already done. We concluded an agreement with Solomon Associates, which is actually probably the biggest and most known company for benchmarking of the terminals and as well the refineries around the globe. We will revise our business processes. We will benchmark whether we are doing fine in some particular areas of our performance. Of course, this is all for further efficiency improvement and competitiveness improvement of KN Terminals.
Another important message is that Mr. Piotr Naimski, representative of Polish government and responsible for strategic energy infrastructure, visited KN Terminals, including our FSRU, together with the minister of energy. We have discussed the energy cooperation between Poland and Lithuania and the possibilities of bilateral economic cooperation between Lithuania and Poland. As you probably know, end of this year, gas grid connection between two countries is planned to be opened. It's really important for us to, let's say, to discuss with Poland as a potential partner on the exchange of natural gas between our markets. Of course, I'm proud to announce that despite of the challenges which company is facing presently, we've been announced as the number one employee in the logistics segment by the business magazine, Verslo žinios, Business News. Among all the companies which has been evaluated, we took the fifth place.
Another important message is related with our ESG, or environmental social governance, areas of our activities. Environmental minister also visited our oil terminal, where we have presented our latest investment into, let's say, environmental sustainability. New air pollutant treatment plant, which cleans, let's say, pollutants collected from oil product tanks and rail loading platforms. Why it is important? It is important because Klaipėda Oil Terminal is located within a city. Let's say we are giving our contribution to the surrounding societies and to the city. Let's switch to presentation of main topic for today, of the financial results. I will ask Indrė to make a brief summary of how we were doing. Please.
Thank you, Darius. Let me introduce financial results of first half-year of 2021. Here I presented financial results on quarterly basis. In Q2 as well as in Q1, revenue level is at the same. We see the decrease comparing to the quarters of 2020. Net profit loss is impacted by foreign exchange rates. You can see that net profit adjusted for Q2 and Q1 is balancing around zero. For more details, let's move to half-year results. Revenues of half-year 2020 have decreased in EUR 9 million compared to the same period of last year. The main reason for the decrease is the loss of Belarusian cargo starting from February of 2021. Also, revenues in regulated activities in LNG part have decreased also.
The main impact is that quite significant amounts of LNG surplus, which will be returned to consumers starting from 2023, has been collected in 2020. That's why the level of 2021 compared to the previous year is lower. LNG security supplement amount in 2021 has been reduced in EUR 1.9 million, and the impact to half year is EUR 1 million, with a surplus of first regulated period, which had ended in 2019. The decrease in EBITDA is also noted. As I already mentioned, the main impact is the decrease in revenues. We have a net loss of EUR 6.8 million, and it is the effect of EUR 9 million of loss of foreign exchange rates.
Let me remind you that it is a Forex arise from IFRS 16 requirements and capitalized assets and liabilities, which most are denominated in US dollars in KN. We are calculating deferred tax assets and liabilities, which has significant impact to net profit, and we have financial derivatives. What the company is doing is calculating the adjusted net result when unrealized. Forex arising from IFRS 16 is eliminated, as well as respective impact of deferred tax, which is calculated 15% from unrealized Forex, and the impact of financial derivatives is eliminated also. We have net adjusted loss of €2,000 for first half year of 2021.
Let me remind you that the company is calculating dividends starting from 2020 from net profit loss adjusted. It is based on dividend resolution, which has been amended in April 2021. It is in line with approved amended dividend policy, which has been announced yesterday. I would also like to say that net profit loss adjusted has been impacted by the increase in environmental pollution expenses, and significant increase in permit prices in 2021 has made a huge impact. It's almost EUR 2 million compared to 2020 during the first half of the year. Here is presented the structure of revenues, EBITDA, and net profit loss on segment basis. In the first block, you can see Forex-based; in the second part, you can see adjusted result.
From the diagram, it's obvious that adjustments comes from regulated LNG activities, and it comes from financial activity part that I have already mentioned. Yes, we are happy to announce that from commercial LNG activities, the revenue part has increased in 2021, and this segment has become profitable and started to generate returns. Darius, I will pass the word to you.
Thank you, Indrė. Talking about each segment separately. As it has been communicated many times before about the COVID pandemic's effect and geopolitical effects to our activities. As you can see, we have, let's say, accounted, during first half of 2021, loss of EUR 635,000 in our oil terminal segment. The reasons are listed on the left side of the slide. In general, as we already said, first of all, restrictions around the globe due to COVID and, as a consequence, negative refining margins is influencing the still reduced amount of the cargos which are being exported to seaborne markets. Talking about the Belarusian situation, yes, we have, in June, let's say, new package of the sanctions applied to the Belarusian regime. It's worth to mention that for KN Oil Terminals, actually, this effect of the sanctions materialized even much earlier in the year.
Starting from February, we are not having any revenues from Belarussian cargos. Of course, as a consequence, because we don't have part of, let's say, conventional flow, we were looking for opportunities in the market. It's worth to comment briefly how we were doing with that. Redundant capacities which appeared, let's say, as a consequence of loss of Belarussian cargos. The potential, let's say, utilization of those capacities is entrance of storage market. Let's say, during the first half of the year, this market was, let's say, influenced, or demand in this market was influenced by backwardation on oil product markets. We had a bit less demand as it was expected. Nevertheless, we were quite successful on renting our tanks and capacities for storage of the gasoline with one of the most active, let's say, gasoline traders in the region.
Also, we have extended this cooperation just recently by adding the fuel oil storage services. Let's say mitigation plans are in action, but the market, let's say, consequences is not the best presently. Let's hope we will have another, let's say, opportunity within the remaining year. Other, let's say, flows of revenues, which is worth to mention, is that biofuels is continuing bullish trend. Probably you don't remember, but last year we had a record growth by six or seven times. I don't remember exactly. This year it's continuing, and comparing even with the last record year, we have, let's say, about 63% more transshipment of various biofuels during the first half of 2021.
We added into our portfolio contracts and activities , respectively, related with imports of FAME, which is, let's say, as well, a biofuel or feedstock for biofuel, and monoethylene glycol, which is used for PET production. It's actually a petrochemical market product. We signed a contract for handling of bitumen, which is also a new activity for our terminal, and we are planning to start deliveries and transshipment activities in August. Talking about our other segments. Our regional LNG activities mostly were influenced by the index pricing and supply-demand balance around the globe of LNG. Summarizing, the Klaipėda LNG terminal was utilized by 42%, and actually rate is in line with utilization of other European terminals during same period. Why it is slightly less comparing to 2020? That's because, let's say higher LNG demand in Asian markets, particularly in China, have been recorded.
Of course, record low injections to European gas storages impacted the slower utilization rate. LNG security supplement reduction impact is minus €13.4 million. It remains the same or approximately the same. To remind that Klaipėdos Nafta is implementing, let's say, the security supplement reduction, so to say, project starting in 2020. Talking about the amount of cargoes, as you can see, it is quite similar to what has been transshipped or regassed during the same period, 2020. Two more cargoes: here it is very important what is the size of a cargo. During first half of the year 2020, we had nine large -scale deliveries, 26 small -scale, and we have performed two cargo reloading operations, ship-to-ship operations of LNG. Talking about the market shortly. Natural gas consumption in first half of the year in Lithuania increased by 17%.
Imports by LNG terminal accounted about 64% of entire supplies to Lithuanian market. Talking about the pricing index, it remains quite high. Dutch TTF index, the average index was equal to EUR 19.5 per MWh, while during the first half of the year last year, it was even more than twice as cheaper. The average was EUR 9.2 per MWh. Talking about our commercial LNG activities, which include our global LNG development projects and, let's say, operations of our small -scale LNG infrastructure in Klaipėda. As Indrė already mentioned, during the first half of 2021, it's a break-even period since we came finally with net profit into our P&L from both activities. As already it was mentioned, about EUR 129,000 of net profit has been gained. Talking about further developments. We are on the same strategic line.
We are looking for potential projects, terminals, and investment opportunities globally. Regional focus remains the same. Mainly it's Europe, Southeast Asia, Middle East, and South America. That's all probably about main messages from all our business segments. Indrė , I'm giving back to you a presentation of profitability and market value ratios.
Thank you, Darius. Here its group's main financial ratios. History of five years comparative periods of first half years. You can see , as I suppose, already mentioned many times in previous webinars, that the EBITDA margin has changed from 2019 due to IFRS 16, as the accounting of lease payments has been changed based on IFRS 16 requirements. Those have been capitalized, so not directly accounted in P&L. The effect comes here and seen in EBITDA margin. As well as , ROE and ROA ratios are presented for the same periods. You can see price earnings ratios. Those three blocks of ratios are calculated based on moving annual average method. Earnings per share are calculated based on profit/loss adjusted other reporting periods. Also please be noted that all the ratios here are presented based on net profit/loss adjusted.
Here, let me briefly comment on the structure of balance sheet. Total assets has decreased in approximately EUR 24 million. The main reason is the depreciation of property, plant and equipment, and right -to-use assets. Also, we have changes in cash and cash equivalent balances. At the year end of 2020, the company had the deposit in other current asset side, and it has been returned to the company, and now we can see it in the cash equivalent. Cash also has decreased, as dividends in EUR 7.5 million has been paid in 2021. Non-current lease liabilities has decreased also mainly due to finance lease obligations decrease. Net amount of loans payables has increased to EUR 5 million.
As Darius already talked, let me remind you that we have LNG security supplement reduction project, and it means that the company has loans from Nordic Investment Bank in EUR 26.8 million per annum additionally. Other non-current liabilities have reduced due to decrease in deferred tax liabilities amount in EUR 1.3 million, and also other liabilities have reduced mainly due to the decrease in payables and the changes in value of financial derivatives. Equity has reduced , respectively, due to mostly dividend payments and accumulated net profit.
Yeah. Probably that's it from our side, and we can switch, Emilia, to questions and answers part.
Thank you very much for the presentation. Before going to the questions, I would like to remind every one of you that you can send in your questions in the question box of your screen. Let's proceed. The first question that we received before the webinar is, what are the last projects implemented by Klaipėdos Nafta with your own or EU funds? Thank you.
Thank you for the question. It's quite extensive because it consists from two parts. Meaning with own or EU funds. With own meaning everything, all the projects which we have done recently. Talking about the biggest own financed projects, I think it's reconstruction or construction of an additional jetty at Klaipėda Oil Terminal and the last phase of the expansion of our tank farm, adding petrochemical and more flexible tanks for our oil terminal strategy implementation. Talking about projects which has been financed or granted by European funds, the last one was already mentioned earlier today. It's a vapor collection unit and filtering unit from railway trestles and heavy fuel oil tank farm. This project was partially funded by KN and by the Environmental Project Management Agency in Lithuania. The project is actually on a testing or infrastructure is on a testing phase. Final tunes of it has been done.
The value of this project reached about EUR 1.5 million, from which about EUR 130,000 were funded by EU funds. That's probably it with this question.
Thank you very much. The next question is as following: What acquisitions are planned for the next two to five years in oil and LNG segments? Thank you.
It's worth to mention that company presently is under a revision phase of our strategy 2030. Probably more precise directions of potential M&A activities will be identified during Q3 and Q4 of the year. Talking about the nearest acquisitions which we are planning to implement is, of course, acquisition of FSRU, which, as you know, till 2025 is leased from Höegh, Norwegian company. Of course, as a part of our strategy, we are looking into various operative opportunities, including M&A opportunities in a field of LNG projects worldwide. With a main focus on floating technologies where we have, let's say, competitive edge and where we can capitalize our know-how accumulated with the implementation of Klaipėda FSRU project. Thank you.
Thank you very much. Also , another question which is, to what extent does the strategy of Klaipėdos Nafta relate to that of Ignitis Group? Does the implementation of Klaipėdos Nafta's strategy depend on the success of Ignitis Group? What is the economic relationship with the company in question? Thank you.
Thank you for the question. I think first of all, we should start from the basics. Klaipėdos Nafta and Ignitis Group has different representatives of the main shareholders, where Ignitis Group is reporting to Ministry of Finance. Main shareholder is Ministry of Finance. In KN case, it's Ministry of Energy as a major or main shareholder. Talking about the calibration of a strategy, so to say, I think we are a bit different nature companies, where KN is operator of logistics infrastructure and is a part of a supply chain of the liquid energy, let's say, in the shape of oil products, crude oil itself, and liquid natural gas. Strategies is and, I believe, remain different. I think the directions of, let's say, our strategies, which can be common, is definitely vision on a greener, less polluted fuel part.
Where Ignitis is, let's say, already defined what are those directions? We are, as already mentioned, on the way and in progress of finding our additional legs, or, let's say, activity directions in the greener topics such as hydrogen and such as maybe CCS or other alternatives. Some part of our updated strategy definitely will have some, let's say, similarities or some connections to Ignitis Group. Nevertheless, as I already said, we are different nature companies, and strategies is different. Another part of the question was what is the economic relationship with the company in question. Ignitis Group and KN has few crossing points and few angles of a commercial relationship. First of all, Ignitis Group is a supplier of, let's say, energy to KN. Was, is.
Now we have some competition in that market, but in general, from time to time, we are concluding transactions with Ignitis Group on acquisition of electricity or gas. Since it is treated as a related counterparties, you can find detailed information in our publicly accessible sources, such as our website. Of course, Ignitis Group, on the other hand, is a customer of ours in Klaipėda FSRU infrastructure. Actually, Ignitis Group is a client, which is a dedicated supplier of LNG to Lithuania. This is an answer from our side.
Thank you very much. I would like to remind everyone that you can send in your questions in the question box of your screen. Let's proceed with the fourth question, which is: When is it planned to purchase the FSRU from Norway, and of what capacity? Thank you.
Thank you for the question. It's worth to clarify here that there is no plan to buy Norwegian or other origin FSRU. We are now performing or already started public procurements, international public procurement process. The goal is to seek and select economically and the most advantageous offer of FSRU. Of course, we have a so-called buyout option with the Höegh, with the Norwegian FSRU supplier, in the time charter party agreement. As I already mentioned in the acquisitions part of the question part, KN will become the owner of FSRU latest in December 2024. The size of the FSRU, as it is described in the conditions of public tender, will not be lower than 150,000 cubic meters, and other technical characteristics of FSRU should remain same or similar or better as they are today.
All the details are also available in the publicly accessible sources because it's a very big and international acquisition process with a lot of regulations. If you need some additional information, you can find it in our website about technical parameters, about the criteria, about everything what is related with this acquisition. Thank you.
Thank you very much. Could you please comment if the pension funds invest in Klaipėdos Nafta, and if so, which countries? Thank you.
Yeah, we checked a bit. Yes, pension funds as well as financial institutions are among our investors or shareholders, and most of them are from Baltic region.
Thank you. To what extent is Klaipėdos Nafta able to adapt its existing infrastructure to hydrogen? Could LNG terminal infrastructure be adapted for that? Thank you.
Thank you for the question. I will start from, let's say, physics, probably, or physical differences between the liquid hydrogen and LNG. It's completely different molecule. It's completely different, let's say, source of energy. The question about possibility to adopt LNG or liquefied natural gas infrastructure is simple and straightforward. No, it's not suitable. Why? I just will give few examples. First of all, temperature of a liquid natural gas is about -160 degrees, while temperature of liquid form of the hydrogen is around 250. Technologically, LNG infrastructure was not built for that and cannot resist more cold or more cryogenic temperatures. Second of all, I already mentioned the size of a molecule, and the difference is as well significant. Talking about the density of a liquid LNG, it's 450 kilograms in a cubic meter, while liquid hydrogen, it's about 70 kilograms per cubic meter.
It's significant differences, and the answer here is no. Talking about adoption of, let's say, our jetty or the pipeline which we operate from FSRU till gas metering station, which is about 18 kilometers. Yes, theoretically, with some CapEx investments, we can adopt, but not for pure hydrogen transportation, but for some part of, let's say, or share in natural gas. Still, it's not possible without the technological changes and investments into infrastructure. The percentage, there is various opinions. Percentage can be up to 10%, but some scientists are saying, no, it should be less than 3%. It's not only a problem about the possibility to adopt infrastructure. The problem is, if you are adding the hydrogen molecule into the mix with natural gas, what about consumption?
You should adopt then not only the logistics or grid infrastructure; you should adopt as well the, let's say, end users' infrastructure for power generation, for heating generation, whatsoever. Thank you.
Thank you very much. As we have one more question remaining, I would like to remind all the attendees that your questions are very much welcome to the question section of your screen. The seventh question that we have is: What age of natural gas has begun in Africa with limited infrastructure? Does Klaipėdos Nafta have plans to invest in Africa? Thank you.
Thank you for the question. Yeah. Now a lot of regions are extracting natural gas. You have Africa, maybe was the first, I don't know exactly, but nevertheless, our strategy, as already mentioned in the global LNG development, includes all the globe, all the geographical regions, of course, subject to, let's say, country crediting and let's say, even safety risks. Let's say all the projects which meets the appetite of the mentioned risks is subject to our decision. Thank you.
Thank you very much. We just received one more question, which is as following: Any chance that transshipment from Belarus can resume in the near future, please?
Can you spell it one more time? Okay. I can see it now on the screen. This question probably is more political nature, not economical nature. The infrastructure which we operating. Of course, we can physically restart transshipment of any product which can be produced in Belarusian refineries. As I mentioned, it's a question of political decisions, and it's a question of where Belarus will turn in the nearest future. With existing sanctions, no. If the situation changes significantly, yes, of course, we are able and capable to provide services for the transshipment of any product out of Belarus. Thank you.
Thank you very much. As all the questions are answered, on behalf of Nasdaq Vilnius, thank you, everyone. It was our pleasure being with you today. Recording of the presentation will be available in the Nasdaq Baltic YouTube channel. Thank you, dear management, for the presentation and a very interesting Q&A session. Have a good day, everyone, and goodbye.
Thank you. Goodbye, everybody.
Thank you. Have a nice day.