EVN AG

  • WKN: 878279
  • ISIN: AT0000741053
  • Land: Austria

Nachricht vom 28.05.2015 | 08:00

EVN AG: Business development in the first half year of 2014/15


DGAP-News: EVN AG / Key word(s): Half Year Results

2015-05-28 / 08:00

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Business development in the first half year of 2014/15
(1 October 2014 - 31 March 2015)

Highlights

* Significant increase in electricity production
* Sale of the sodium hypochlorite plant to the water supply and waste water
disposal company of the city of Moscow
* Operating result above prior year; stable Group net result
* EUR 1 billion investment plan to support supply security in Lower Austria
and the expansion of renewable energies over four years already in the
implementation phase
* Reduction in the energy price for electricity at the beginning of the
2014/15 financial year; start of the EVN Bonus World on 1 April 2015
* Outlook 2014/15: Group net result expected to exceed the 2012/13 level

Key figures

* Revenue: +6.5% to EUR 1,224.7m
* EBITDA: +18.1% to EUR 384.0m
* EBIT: +19.5% to EUR 237.5m
* Financial result: EUR -31.4m to EUR -22.0m 
* Group net result: -0.5% to EUR 165.4m
* Net debt: EUR 1,359.4m (30.09.2014: EUR 1,622.4m)

Energy sector environment

The first half of the 2014/15 financial year in Austria was characterised
by average temperatures that were nearly identical to the previous year
and, therefore, also above the long-term average. As a result, the heating
degree total remained unchanged at a low level. In contrast, lower
temperatures in South Eastern Europe led to a 12.3% increase in the heating
degree total in Bulgaria and 9.0% in Macedonia.

The continuing expansion of renewable energy generation capacity in Austria
and Germany as well as the low price of coal and - despite the recent
increase - the still low price for CO2 emission certificates led to a
further drop in the forward and spot market prices for base load and peak
load electricity during the first six months of 2014/15. The forward prices
applicable to the reporting period fell by 12.0% to EUR 38.0 per MWh for
base load electricity and by 11.9% to EUR 49.1 per MWh for peak load
electricity. In comparison with the first six months of 2013/14, the spot
market prices declined 8.2% to EUR 33.5 per MWh for base load electricity
and by 11.0% to EUR 43.5 per MWh for peak load electricity.

Substantial increase in EBIT; Group net result nearly at prior year level
The EVN Group generated revenue of EUR 1,224.7m in the first half of
2014/15, which represents an increase of EUR 74.2m, or 6.5%, over the
comparable prior year period. Revenue development was positively
influenced, above all, by an increase of 32.9% in the company's own
electricity generation, increased natural gas marketing activities and
recent tariff decisions in Bulgaria and Macedonia. In addition, the Theiss
and Korneuburg power plants were called on more frequently by the Austrian
and German transmission network operators to ensure network stability.

Other operating income rose by EUR 25.1m to EUR 66.6m, among others due to
the sale of the sodium hypochlorite plant. The 5.9% increase in the cost of
electricity purchases from third parties and primary energy expenses to EUR
638.3m was related to the increase in electricity generation through full
operations at the Duisburg-Walsum power plant, the use of natural gas
volumes for trading purposes and higher energy procurement costs in
Bulgaria due to recent tariff decisions. The cost of materials and services
rose by 14.8% to EUR 126.6 m, primarily due to an impairment loss EUR 11.0m
which was recognised to remaining components from the former thermal waste
utilisation plant no. 1 in Moscow. This measure involves the flue gas
cleaning aggregate, which was adapted to meet the particular requirements
of the city of Moscow and, based on recent market information, cannot be
used for another purpose.

Slightly higher personnel expenses, lower other operating expenses and an
increase in the share of results from equity accounted investees with
operational nature led to an increase of 18.1% in EBITDA to EUR 384.0m.

In addition to an investment-related increase in scheduled depreciation and
amortisation, impairment losses of EUR 19.0m were recognised during the
reporting period. The impairment losses resulted, above all, from the
closing of a Verbund power plant unit at the Dürnrohr joint power plant in
April 2015 and the related expectations of higher maintenance and operating
costs in the future. Based on these developments, the results from
operating activities (EBIT) totalled EUR 237.5m, for a year-on-year
increase of EUR 38.8m or 19.5%.

Financial results amounted to EUR -22.0m and were EUR 31.4m lower than in
the previous year. This change resulted from a reduced dividend from
Verbund AG for the 2014 financial year, the termination of the hedge for
the financing of the sold sodium hypochlorite plant in Moscow and the costs
for the related investment guarantee from the Federal Republic of Germany.
After the deduction of income tax, which remained unchanged in year-on-year
comparison, and the share of result attributable to non-controlling
interests, Group net result equalled EUR 165.4m and was 0.5% below the
previous year.

Reduced net debt; solid balance sheet structure 

Gross cash flow rose by EUR 5.3m to EUR 305.7m in the first half of
2014/15, chiefly due to the increase in the result before income tax. The
decline of EUR 141.0m in cash flow from operating activities to EUR 209.4m
resulted from changes in working capital, whereby the prior year was
influenced by non-recurring effects.  Cash flow from investing activities
was positive and amounted to EUR 95.5m, which reflected the influence from
the sale of the sodium hypochlorite plant. Part of the proceeds were
invested in short-term securities. Cash flow from financing activities
equalled EUR -300.4m for the reporting period, compared with EUR -216.8m in
the first half of the previous year. This development reflected the
repayment of the financing for the sodium hypochlorite plant and the
scheduled repayment of financial liabilities. Also included here is the
payment of the dividend in January 2015 for the 2013/14 financial year.

Net debt declined EUR 263.0m below the level on 30 September 2014 to EUR
1,359.4m as of 31 March 2015, and gearing fell to 50.5% (30 September 2014:
61.6%).  Equity increased by EUR 61.0m, or 2.3%, to EUR 2,693.7m. The
equity ratio equalled 40.3% as of 31 March 2015 (30 September 2014: 38.5%).

Developments in the energy and project business

Energy business

Over four years EVN will invest approximately EUR 1 billion in the
networks, renewable energy and water supplies in Lower Austria. This not
only highlights the company's clear focus on ensuring supply security for
its customers, but also underscores its local presence in the home market.

In the area of windpower, the Prottes-Ollersdorf wind park with twelve wind
turbines and a generation capacity of 37 MW was commissioned during the
reporting period. That gives EVN 250 MW of windpower generation capacity to
supply 150,000 households with environmentally friendly electricity. In
hydropower generation, the completion of revitalisation work on the Mühlhof
hydropower plant in March showed the focus in this field of operation.
 
As of 1 January 2015, the regulated network tariffs in Lower Austria were
reduced by roughly 1% for electricity and roughly 3% for natural gas. The
energy price for electricity was previously reduced as of 1 October 2014
within the framework of the EnergieAllianz. This lowered the energy price
by 10% for an average household in Lower Austria with power consumption of
3,500 kWh per year.

Environmental business

EVN's environmental services business is currently working on eight
international projects. The transfer of the sodium hypochlorite plant in
Moscow was successfully finalised in March 2015. As indicated in the report
on the first quarter, this plant was sold to Mosvodokanal, the water supply
and waste water disposal company of the city of Moscow. The successful
completion of a 72-hour test demonstrated the fulfilment of all quality and
volume requirements and completed the commissioning process which, in turn,
terminated EVN's guarantee for the functionality of the plant.

Water supplies in Lower Austria were further improved by the commissioning
of a new natural filter plant in Drösing, which reduces the hardness of the
water for the region's customers by natural means. Construction is also
proceeding on a further natural filter plant in Obersiebenbrunn, and the
permit required by the Austrian Water Act was received for the natural
filter plant in Zwentendorf an der Zaya. The completion of these three
plants will significantly improve the water quality for nearly 200,000
residents in the Weinviertel and Marchfeld regions. In addition, EVN took
over the management and operation of the water supply network in the
community of Paudorf as of 1 January 2015.

 
Outlook

The stable developments during the first six months lead us to confirm our
outlook for the 2014/15 financial year, with Group net result that is
expected to exceed 2012/13. The assumptions for energy sector developments
over the remaining six months are based on long-term averages, and actual
developments cannot be predicted with certainty. Group results could be
significantly influenced by regulatory conditions, developments in the
proceedings related to claims from the tariff decisions in Bulgaria and in
connection with the Duisburg-Walsum power plant as well as the progress of
the activities in Moscow.

For the complete Letter to Shareholders for the first half year of 2014/15
see www.investor.evn.at.



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2015-05-28 Dissemination of a Corporate News, transmitted by DGAP - a
service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

The DGAP Distribution Services include Regulatory Announcements,
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Language:    English                                                
Company:     EVN AG                                                 
             EVN Platz                                              
             2344 Maria Enzersdorf                                  
             Austria                                                
Phone:       +43-2236-200-12294                                     
Fax:         +43-2236-200-82294                                     
E-mail:      info@evn.at                                            
Internet:    www.evn.at                                             
ISIN:        AT0000741053                                           
WKN:         074105                                                 
Indices:     ATX                                                    
Listed:      Foreign Exchange(s) Wien (Amtlicher Handel / Official  
             Market)                                                
 
 
End of News    DGAP News-Service  
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362349 2015-05-28                                                      

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