DGAP-News: EVN AG / Key word(s): Half Year Results/Half Year Results EVN AG: Development of business in the 1st half year 2010/11 26.05.2011 / 08:00 --------------------------------------------------------------------- (October 1, 2010 - March 31, 2011) * Cold winter in Austria once again * Significant progress within the framework of the 'roadmap' in Macedonia - End to court proceedings with the state-owned company ELEM in Macedonia * Trans-regional natural gas pipeline 'Südschiene' near completion - Start of construction of 'Westschiene' * Construction commences on two additional wind parks in Lower Austria * First projects for the Environmental Services segment in Romania * Outlook 2010/11: Operating result at the prior-year level, Group net profit below the previous year HY. 1 Change EURm 2010/11 in % Revenue 1,629.7 +0.3 EBITDA 324.1 +3.6 EBIT 197.2 +1.4 Group net profit 184.0 -11.7 The energy sector environment in the first half year 2010/11 (October 1, 2010 - March 31, 2010) was affected by colder weather in Austria and in Macedonia as well as higher temperature in Bulgaria. European wholesale prices for electricity as well as for CO2 certificates were above the previous year's levels due to the positive economic development. Likewise primary energy prices significantly increased as a result of rising demand in the emerging markets, particularly China and India, as well as limited supply, prices for primary energy were significantly above previous year's level. The valid forward prices for electricity increased in the second quarter of 2010/11, but were still below the prices prevailing in the preceding year. Declining revenues in Energy business were compensated by the performance of the Environmental Services business In the first half year 2010/11 EVN generated a slight increase in total revenue of 0.3% to EUR 1,629.7m despite the ongoing difficult business environment. The revenue decline in the Generation segment and Energy Trade and Supply segment as well as in the Energy Supply South East Europe segment - the latter relating to the changed reporting of revenue in Bulgaria - was compensated by significant revenue growth in the Environmental Services segment as well as in the Network Infrastructure Austria segment. Slight improvement of operating profit Despite the higher sales volumes for electricity, gas and heating, as well as increased procurement costs in the gas business and in South East Europe, the costs for 'Electricity purchases and primary energy expenses' fell. This development is due to the slightly lower electricity procurement prices in Austria and the changed reporting of this item in Bulgaria. The significantly higher volume in the international project business led to a rise in the cost of materials and services. Lower personnel expenses and decreased level of write-offs on receivables led to an EBITDA increase in the period under review of 3.6% to EUR 324.1m. In consideration of an increased amortisation by 7.1% the EBIT improved by 1.4% to EUR 197.2m. Group net profit below the previous year The financial result in the first half of 2010/11 fell by 30.9% to EUR 49.6m. The higher income from investments in equity accounted investees, especially from RAG, could not compensate for the declining gain from other investments, in particular the lower dividend paid by VERBUND AG, as well as for the increase in the interest expenses. After deduction of a 10.0% lower income tax and the higher share of the profit attributable to noncontrolling interests, the Group net profit for the period declined by 11.7% to EUR 184.0m. Capital increase strengthened the financial position; significantly lower increase of working capital achieved In the first half of 2010/11, the gross cash flow amounted to EUR 294.5m, up 1.9% from the prior-year level. The net cash flow from operating activities could be significantly increased by EUR 144.1m to EUR 221.3m due to a lower increase of working capital. At EUR 7,356.7m, EVN's total assets rose by 9.3% compared to the last balance sheet date at September 30, 2010. Likewise equity rose by 17.0% to EUR 3,540.2m compared to the last balance sheet date. The equity ratio was 48.1%. Net debt of EUR 1,341.7m corresponded to a gearing of 37.9% which was significantly below previous year's level (March 31, 2010) of 48.7% Significant progress in regards to Macedonia's 'roadmap' Significant progress was made within the framework of the 'roadmap' settled between the Macedonia government and EVN in 2010. The Macedonian Parliament approved a new energy law in February 2011, which fulfilled the demand of the Energy Community to establish a liberalised electricity market. In March 2011, the end customer prices for electricity in Macedonia were raised by about 5.5% of which 89.6% is attributable to EVN Macedonia. In addition on March 30, 2011, court proceedings pending since 2008 between the state-owned company ELEM and EVN Macedonia were ended by a settlement. Further investments in the home market of Lower Austria During the reporting period, construction work commenced on the last part of the southern section of the 120 km trans-regional high-pressure natural gas transport pipeline 'Südschiene' in Lower Austria, as well as on the 150 km western section 'Westschiene'. Total investments for both pipelines amount to EUR 264.0m. In the second quarter of 2010/11 work began on two wind parks in Markgrafneusiedl and Tattendorf, with a total investment of EUR 57.0m. With a total output of its nine wind parks of 260 MW, EVN is added to the largest windpower producers in Austria. Outlook Considering EVN's performance in the first half of 2010/11, we expect the result from operating activities for the entire 2010/11 financial year to match the previous year's performance, despite the ongoing difficult and uncertain overall business and energy sector environment, rising primary energy prices and continuing lower wholesale prices on forward markets in the electricity segment. The Group net profit for 2010/11 as a whole will likely be below the comparable prior-year figure. The complete Letter to Shareholders HY. 1 2010/11 is available at www.investor.evn.at. End of Corporate News --------------------------------------------------------------------- 26.05.2011 Dissemination of a Corporate News, transmitted by DGAP - a company of EquityStory AG. The issuer is solely responsible for the content of this announcement. DGAP's Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------- Language: English Company: EVN AG EVN Platz 2344 Maria Enzersdorf Ãsterreich Phone: +43-2236-200-12294 Fax: +43-2236-200-82294 E-mail: info@evn.at Internet: www.evn.at ISIN: AT0000741053 WKN: 074105 Listed: Foreign Exchange(s) Wien (Amtlicher Handel / Official Market) End of News DGAP News-Service --------------------------------------------------------------------- 126208 26.05.2011
DGAP-News: EVN AG: Development of business in the 1st half year 2010/11
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