February 8, 2018 / 8:29 AM / 12 days ago

Greece's Public Power Corp. dismisses report it needs big cost cuts this year

ATHENS, Feb 8 (Reuters) - Greece’s Public Power Corp (PPC) dismissed on Thursday as “totally inaccurate” a press report saying it needed to save 500 million euros ($614 million) this year to shore up its finances.

The state-controlled utility has been hurt by hefty provisions for unpaid bills by Greek households and businesses during the country’s financial crisis.

To prop it up, the Greek state has decided to pay about 476 million euros for costs the utility took on to supply power to the Greek islands and to clear state arrears. PPC said it had already received 360 million euros.

PPC has also taken action to collect arrears estimated at 2.4 billion euros which led to a drop in provisions in the third quarter last year for the first time in recent years.

Greece’s Kathimerini newspaper reported on Wednesday that consultancy McKinsey, which is working on PPC’s business plan, urged the utility to cut expenditure by at least 500 million euros this year.

In a bourse filing, PPC said the money it had received from the state had helped it build additional cash to redeem some outstanding notes under its plan to manage debt due in 2019.

It added its 2018-22 business plan would include actions to cut costs, improve the collection of unpaid bills and invest in renewable energy to boost operating profit.

$1 = 0.8141 euros Reporting by Angeliki Koutantou; Editing by Mark Potter

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