E.ON SE

Earnings Release • May 9, 2007

News Details

Corporate | 9 May 2007 12:00

E.ON posts significant earnings improvement

E.ON AG / Quarter Results

Release of a Corporate News, transmitted by DGAP - a company of EquityStory
AG.
The issuer / publisher is solely responsible for the content of this announcement.

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• Adjusted EBIT up 21 percent year on year
• Earnings growth primarily outside Germany

In the first quarter of 2007, the E.ON Group increased sales by 6 percent
to €21.1 billion (prior year: €19.9 billion) and adjusted EBIT by 21
percent to €3,315 million (€2,730 million). At €3,067 million, net income
attributable to shareholders of E.ON AG was 50 percent above the high
prior-year figure (€2,045 million). Adjusted net income was up 33 percent
to €1,974 million (€1,481 million).
Significant contribution from subsidiaries outside Germany

The Central Europe market unit’s adjusted EBIT of €1,431 million was on par
with the prior-year figure (€1,418 million). The negative factors in the
electricity business included lower results from power trading, higher
electricity procurement costs, higher expenditures resulting from an
increase in the amount of renewable-source electricity delivered onto the
network, and a regulation-driven decline in earnings from network charges.
The mild winter led to significant declines and sales volume and adjusted
EBIT at Central Europe’s gas business. Pan-European Gas’s adjusted EBIT
rose by 18 percent to €1,126 million (€958 million). The international
business continues to grow in importance and as a contribution to earnings.
New supply contracts were concluded with large customers in Denmark,
France, and Italy. The inclusion of the E.ON Földgáz Group of Hungary in
the current-year quarter and higher earnings from other downstream
shareholdings outside Germany also had a positive impact on adjusted EBIT.
Lower sales prices in the upstream business had an adverse impact on
earnings, while adjusted EBIT at the midstream business was negatively
impacted by the decline in sales volumes resulting from warm winter
weather. However, this was counteracted by the absence in the current year
of the adverse earnings effect recorded in the prior year resulting from
the fact that procurement prices are adjusted faster than sales prices. The
U.K. market unit posted the most significant earnings growth. U.K.’s
adjusted EBIT of €436 million far surpassed the prior-year figure (€43
million), primarily due to lower gas procurement costs, which had been
substantially higher in the prior-year quarter because of a gas supply
bottleneck and unseaso¬nably cold weather. Nordic’s adjusted EBIT declined
by 4 percent to €287 million, in particular due to lower spot electricity
prices. Adjusted EBIT at U.S. Midwest fell by 17 percent to €93 million
(€112 million) due to currency effects and lower gas margins.

Outlook improved

Based on the first quarter’s positive earnings development, E.ON expects
full-year adjusted EBIT to surpass the high prior-year level. From today’s
perspective, E.ON also expects 2007 net income attributable to shareholders
of E.ON AG to be higher, although earnings development will be especially
influenced by the marking to market of derivatives at year end.

E.ON CEO Wulf H. Bernotat said: 'It’s now clear how important it was for us
to focus systematically on growth in Europe. E.ON achieved its
first-quarter earnings improvement predominantly outside Germany. In our
home market, by contrast, we’re increasingly experiencing the adverse
effects of Germany’s energy-policy and regulatory environment. We’ll meet
this challenge by extending our position in Europe and intensifying our
efforts to increase efficiency.'

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This document may contain forward-looking statements based on current
assumptions and forecasts made by E.ON Group management. Various known and
unknown risks, uncertainties and other factors could lead to material
differences between the actual future results, financial situation,
development or performance of the company and the estimates given here.
These factors include those discussed in our public reports filed with the
Frankfurt Stock Exchange and with the U.S. Securities and Exchange
Commission (including our Annual Report on Form 20-F, in particular to the
discussion included in the sections entitled 'Item 3. Key Information: Risk
Factors', 'Item 5. Operating and Financial Review and Prospects', 'Item 11.
Quantitative and Qualitative Disclosures about Market Risk'). The company
assumes no liability whatsoever to update these forward-looking statements
or to conform them to future events or developments.

DGAP 09.05.2007

Language: English
Issuer: E.ON AG
E.ON-Platz 1
40479 Düsseldorf Deutschland
Phone: +49 (0)211 4579-0
Fax: +49 (0)211 45 79-5 01
E-mail: investorrelations@eon.com
www: www.eon.com
ISIN: DE0007614406
WKN: 761440
Indices: DAX, EURO STOXX 50
Listed: Amtlicher Markt in Berlin-Bremen, Frankfurt (Prime Standard),
Hannover, Düsseldorf, Stuttgart, München, Hamburg;
Terminbörse EUREX; Foreign Exchange(s) Mailand, NYSE

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