DGAP-News: EVN AG / Key word(s): Quarter Results/Quarter Results
EVN AG: Business development in the first three quarters of 2014/15
27.08.2015 / 08:00
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(1 October 2014 - 30 June 2015)
Highlights
- Reduction in end customer prices for electricity and natural gas by 5% on
average as of 1 October 2015; start of the EVN Bonus World on 1 April
2015
- Increase in electricity production:
âExpansion of renewable energy production: Completed commissioning of the
37 MW Prottes-Ollersdorf windpark in May 2015
âIncrease in use of natural gas power plants to ensure network stability
in Austria and Germany
âFull operations at the Duisburg-Walsum power plant
- Sale of the sodium hypochlorite plant to the water supply and waste water
disposal company of the city of Moscow
- Operating result as well as Group net result above prior year
- 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
- Outlook 2014/15: Group net result expected to exceed the 2012/13 Level
Key figures
- Revenue: +11.3% to EUR 1,664.1m
- EBITDA: +38.8 % to EUR 497.2m
- EBIT: EUR +328.4m to EUR 286.5m
- Financial result: EUR-31.2m to EUR -41.2m
- Group net result: EUR +246.1m to EUR 187.1m
- Net debt: EUR 1,293.6m (30.09.2014: EUR 1,622.4m)
Energy sector Environment
The average temperatures in Austria during the first three quarters of
2014/15 were nearly identical to the previous year and, therefore,
continued to exceed the long-term average. The heating degree total
conse-quently remained unchanged at a low level. In contrast, lower
temperatures in South Eastern Europe led to a 14.8% increase in the heating
degree total in Bulgaria and 10.8% 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 nine months of 2014/15. The forward prices applicable to the
reporting period fell by 4.3% to EUR 35.7 per MWh for base load electricity
and by 5.8% to EUR 45.3 per MWh for peak load electricity. In comparison
with the first nine months of 2013/14, the spot market prices declined 6.7%
to EUR 31.8 per MWh for base load electricity and by 8.3% to EUR 40.1 per
MWh for peak load electricity.
Increase in EBIT and Group net result
Revenue generated by the EVN Group rose by 11.3% to EUR 1,664,1m in the
first three quarters of 2014/15. This increase was supported, above all, by
full operations at the Duisburg- Walsum power plant throughout the entire
reporting period and the related sale of electricity as well as the Group's
natural gas sales activities, the results of recent price decisions in
Bulgaria and Macedonia and the absence of negative non-recurring effects
from regulatory decisions in South Eastern Europe during the previous year.
In addition, the Theiss and Korneuburg power plants were called on more
frequently by the Austrian and German transmission system operators to
ensure network stability.
Other operating income rose by EUR 21.6m to EUR 90.3m. This improvement is
attributable primarily to the sale of the sodium hypochlorite plant
project. The cost of electricity purchases from third parties and primary
energy expenses amounted to EUR 841.2m for the reporting period and was
6.5%, higher in year-on-year comparison. This development resulted
primarily from the start of full operations at the Duisburg-Walsum power
plant, the use of natural gas volumes for trading purposes and increased
energy purchase prices in Bulgaria. The cost of materials and services rose
by 9.8%, to EUR 186.3m. This amount includes a valuation allowance of EUR
11.0m recognised in the second quarter to the remaining components of the
former project thermal waste utilisation plant no. 1 in Moscow. Higher
costs were also recorded due to the above-mentioned full operations at the
Duisburg-Walsum power plant, a turbine damage at the co-generation plant in
Bulgaria and weather-related damages to the distribution networks in
Bulgaria and Macedonia during the winter 2014/15.
An increase in personnel expenses due to wage and salary adjustments
required by collective bargaining agreements, lower operating expenses as
well as an improved result from equity accounted investees with operational
nature led to an increase of 38.8% in EBITDA to EUR 497.2m.
Scheduled depreciation was increased chiefly by full operations at the
Duisburg-Walsum power plant and ongoing investments, while impairment
losses were substantially lower. Impairment losses in the previous year
were influenced by negative valuation effects from Bulgaria and Macedonia.
Based on these developments, the results from operating activities (EBIT)
totalled EUR 286.5m, which represents a year-on year increase of EUR
328.4m.
Financial results amounted to EUR -41.2m and were EUR 31.2m lower than in
the previous year. This change resulted, on the one hand, from a reduced
dividend from Verbund AG for the 2014 financial year and, on the other
hand, from 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. Group net result
equalled EUR 187.1m. This represents an increase of EUR 246.1m over the
first nine months of the previous year.
Improved gross cash flow; reduced net debt
Gross cash flow rose by EUR 57.4m to EUR 387.6m in the first three quarters
of 2014/15 based on the im-proved operational development. The EUR 51.2m
decline in cash flow from operating activities to EUR 316.1m resulted from
changes in working capital, which were influenced by non-recurring effects
in the previous year. Cash flow from investing activities was positive at
EUR 45.4m. Cash outflows for the current investment programme were
contrasted by cash inflows from the sale of the sodium hypochlorite plant
in Moscow. Cash flow from financing activities equalled EUR -340.6m for the
reporting period and reflected the repayment of the financing for the
sodium hypochlorite plant, the scheduled repayment of financial liabilities
and the payment of the dividend in January 2015 for the 2013/14 financial
year.
Net debt declined EUR 328.8m below the level on 30 September 2014 to EUR
1,293.6m as of 30 June 2015, and gearing fell to 49.1% (30 September 2014:
61.6%). The equity ratio equalled 40.4% as of 30 June 2015 (30 September
2014: 38.5%).
Developments in the energy and project business
Energy business
Within the current four-year investment period, EVN will be investing
approx. EUR 1bn in networks, renewable energy and water supplies - and in
this way, will further improve supply security and service quality for the
customers in its home market.
The investments made in the Generation business segment during the
reporting period were concentrated almost exclusively on renewable energy
generation projects. The focus was on the completion of the
Prottes-Ollersdorf windpark with twelve wind turbines and a generation
capacity of 37 MW which was commissioned in May 2015. 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
2015 showed the focus in this field of operation.
The investment strategy for the Network Infrastructure Austria Segment is
focused on the protection of supply security in Lower Austria. EVN invests,
above all, in network expansion to accommodate the growing generation from
renewable energy sources and in the upgrading of its distribution networks.
Projects during the reporting period continued to concentrate on the
strengthening of the 110 kV network to transport the steadily rising
feed-in of electricity from windpower and on the expansion and new
construction of transformer stations. Two 110 kV lines with a total length
of 20 kilometres were completed during the third quarter of 2014/15. The
sale of the subsidiary V&C Kathodischer Korrosionsschutz GmbH to TÃV
AUSTRIA in June 2015 marked a further strategic step toward consolidation
and concentration on the core business.
In the energy trade and supply business EVN's sales company will pass on
the benefits from lower energy procurement costs in the form of a price
reduction for private customers by EnergieAllianz Austria. The end customer
prices for electricity and natural gas will be reduced by 5% on average as
of 1 October 2015. In South Eastern Europe the regulatory authorities in
Bulgaria and Macedonia have announced their price decisions for the coming
12 months. End customer prices in Macedonia were reduced by 0.3% as of 1
July 2015. The regulatory decision in Bulgaria was initially postponed by
one month to 1 August 2015, and the new tariffs call for a reduction of
0.4% in end customer prices.
Environmental business
In the international project business, EVN is currently working on the
realisation of eight projects. In the Kujawy wastewater purification plant
in the Polish city of Krakow three of the four wastewater lines were
successfully commissioned during the first three quarters of 2014/15, and
the commissioning process for the fourth line was started. This plant will
have a capacity to service 370,000 residents.
EVN is also currently realising two projects in Romania. In Zalau, the
expansion of the local wastewater purification plant and the construction
of a sludge treatment plant with biogas utilisation for 85,000 residents
started during February 2015. The wastewater treatment plant built by EVN
in Silvaniei, which has a capacity to service roughly 30,000 residents,
entered the commissioning phase in April 2015. The commissioning process
has been nearly finalised for the waste water purification plant in
Larnaca, Cyprus, that was completed during the previous financial year.
In the area of drinking water supplies for Lower Austria, EVN - which
currently supplies drinking water for more than 500,000 residents in Lower
Austria - continued work on numerous projects to supply new com-munities
with drinking water and to further improve the quality of drinking water
for existing customers. EVN took over the management and operation of the
water supply network for the community of Paudorf, including drinking water
supplies for the roughly 2,500 local residents, as of 1 January 2015. In
addition, EVN continued to pursue projects for the construction of natural
filter plants to reduce the hardness of the water by natural means. The
commissioning of a natural filter plant in Drösing during December 2014 was
followed in the third quarter of 2014/15 by the commissioning of a natural
filter plant in Obersiebenbrunn and the start of construction on a similar
plant in Zwentendorf an der Zaya. The completion of these three plants will
improve the water quality for nearly 200,000 residents in the involved
regions.
Outlook
The positive first three quarters 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 during the
financial year are based on long-term averages, and short-term developments
cannot be predicted with certainty. The Group net result 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 by the progress
of the activities in Moscow.
For the complete Letter to Shareholders for the first three quarters of
2014/15 see www.investor.evn.at.
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27.08.2015 Dissemination of a Corporate News, transmitted by DGAP - a
service of EQS Group AG.
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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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389739 27.08.2015
DGAP-News: EVN AG: Business development in the first three quarters of 2014/15
| Source: EQS Group AG