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EVN AG Call Transcript 2015

Dec 10, 2015

742_ip_2015-12-10_86d35211-9a37-432e-8538-db4b886b95fa.pdf

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EVN Conference CallAnnual results 2014/15

10 December 2015

Increase in electricity generation

  • Commissioning of new 37 MW windpark Prottes-Ollersdorf
  • Favourable wind and water flows for renewable generation
  • Short-term use of natural gas-fired power plants to ensure network stability
  • First full-year operation of the Duisburg-Walsum power plant
  • Improvement of operating business in South East Europe and absence of prior year's negative one-offeffects and impairment losses
  • Agreement with the city of Moscow on the sale of the sodium hypochlorite plant
  • Increase in EBITDA, EBIT and group net result

Key financials 2014/15

2
0
1
4
/
1
5		 /–
+
E
U
Rm		 in
%
R
e
v
e
n
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e		 2,
1
3
5.
8		 8.
2
E
B
I
T
D
A		 8
3.
2
5		 -
i
i
d
i
i
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t
t
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6
0.
3		 -1
7
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s		 -5
4.
7		 7
9.
7
E
B
I
T		 2
6
8.
2		 -
i
i
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a
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s		 -6
0.
3		 -8
8.
9
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u		 1
4
8.
1		 -
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2.
4
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i
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a
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p
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r
s
a
r
e		 0.
8
3		 -

Increase in revenues

  • Rise in electricity generation
  • Growth in natural gas trading activities
  • Positive contribution from Bulgaria and Macedonia
  • Improvement in EBITDA, EBIT and group net result
  • Sale of sodium hypochlorite plant Moscow
  • Improvement of operating business
  • Absence of last year's one-off effects

Decrease in financial result

Lower dividend from Verbund

Solid balance sheet structure, reduced net debt

  • Improvement of equity ratio to 39.8% (previous year: 38.5%)
  • Reduction of net debt to EUR 1,230.9m (previous year: EUR 1,622.4m)
  • Gearing decreased from 61.6% to 47.5%

EBITDA development by segments

Generation

2
0
1
4
/
1
5		 /–
+
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%
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7		 9.
1
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5
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1
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1		 1
3.
7
E
B
I
T
D
A		 6
8.
7		 -
E
B
I
T		 -1
0.
5		 8
0.
3

Increase of electricity production and revenue

Rise in EBITDA and EBIT

  • Increased purchase costs for energy carriers almost fully offset by optimisation measures for thermal power plants
  • Increase in depreciation
  • Impairment losses

Energy Trade and Supply

1)
d
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in
%
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7		 2
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2
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5.
8		 8.
3
E
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I
T
D
A		 -2
9		 -
E
B
I
T		 -2
0.
6		 -

Different development of sales volumes

  • Slight increases in electricity and heat sales volumes
  • Small decline in natural gas sales volumes (mainly due to lower volumes in the household segment)

Revenue growth, but lower EBITDA and EBIT

  • Energy sales from Duisburg-Walsum power plant and expansion of natural gas trading activities have positive impact on revenue
  • Provisions for onerous contracts related to the marketing of EVN's own electricity production
1)
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2)
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2.
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6
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D
A		 2
0
1.
2		 7.
7
E
B
I
T		 9
5.
5		 1
4.
7

1) Average; according to the Austrian regulator

2)Including network sales to EVN's power stations

Increase in network distribution volumes

  • Higher electricity and natural gas distribution volumes across all customer segments
  • Additional positive volume impact on gas distribution from use of EVN's gas-fired power plants

Improvement in EBITDA and EBIT

  • Increase in other operating income (due to increased work in progress)
  • Cost reductions and lower additions to personnel provisions

Continued investment focus on supply security

Network Infrastructure Austria accounts for almost 50% of EVN's total investments

Conference Call FY 2014/15 Results 8

Energy Supply South East Europe

d
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%
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3.
9
2)
k
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8
1
2
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1
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3
8.
1,
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1
5.
E
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A		 1
2
0.
7		 -
E
B
I
T		 5
7.
8		 -

Positive development of key energy business indicators

  • Increase of electricity production
  • Weather-related growth of electricity network distribution volumes and heat sales volumes

Revenue, EBITDA and EBIT increase

  • Revenue growth due to higher sales volumes and higher end customer prices
  • Absence of prior year's one-off effects

1) Average; household sector; according to regulators in Bulgaria and Macedonia2)

Energy sales volumes in Bulgaria and Macedonia fairly equal to network distribution volumes

Environmental Services

l
f
i
i
F
n
a
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c
a
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r
o
r
m
a
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e		 2
0
1
4
/
1
5
E
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Rm		 /–
+
in
%
R
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6
1
7		 -9
7
E
B
I
T
D
A		 5
5.
1		 -
E
B
I
T		 2
8.
6		 -

Decline in revenue

  • Lower revenues from international projects business
  • Partly offset by higher revenues from drinking water supplies in Lower Austria

Improvement in EBITDA and EBIT

  • Positive effect from sale of sodium hypochlorite plant in Moscow
  • Transfer of plant completed in March 2015 after successful 72-hour test
  • Absence of previous year's one-off effects

Positive progress in the international projects business

Completion of wastewater treatment projects in Poland, Romania and Cyprus

Cash flow

2
0
1
4
/
1
5		 /–
+
E
U
Rm		 in
%
G
C
F
r
o
s
s		 4
3
8.
1		 2
9.
8
f
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s		 4
7
8.
3		 -1
2.
4
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C
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s		 2.
-7
7		 0.
7
1
f
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s
v		 -3
5
7.
3		 -6
7
h
h
N
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c
a
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c
a
s
d
h
l
i
t
a
n
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a
s
e
q
a
e
n
s
u
v		 4
8.
3		 -

Increase of gross cash flow

Strong operating performance

Decline in operating cash flow

  • Due to changes in working capital related to non-recurring effects in 13/14
  • Cash flow from investing activities improved

Cash flow from financing activities

Influenced by sale of sodium hypochlorite plant

  • Austrian network tariffs for electricity and gas will increase as of 1 January 2016
  • Expected increase of electricity network tariffs1): + 11.2%
  • Expected increase of gas network tariffs1): +11.0%
  • Group net result for 2015/16 is expected to remain largely stable
  • EVN's strategy remains unchanged
  • Commitment to integrated business model
  • Focus on supply security through ongoing network expansion
  • Further increase of renewable generation capacities in Lower Austria
  • Consolidation of energy business in South East Europe

Additional information

Stefan Szyszkowitz

CFOPhone: +43 2236 200-12132Fax: +43 2236 200-82132E-mail:[email protected]

Gerald Reidinger

Head of Controlling and Investor RelationsPhone: +43 2236 200-12698Fax: +43 2236 200-82698E-mail: [email protected]

Alexander Sipek

Investor Relations OfficerPhone: +43 2236 200-12360Fax: +43 2236 200-82360E-mail:[email protected]

Investor information on theweb

www.evn.atwww.investor.evn.atwww.responsibility.evn.atE-mail: [email protected]

EVN AGHeadquartersEVN Platz2344 Maria Enzersdorf

Disclaimer

Certain statements made in this presentation may constitute "Forward-Looking Statements" within the meaning of the U.S. federal securities law. Forwardlooking information is subject to various known and unknown risks and uncertainties. These include statements concerning our expectations and other statements that are not historical facts.

The Company believes any such statements are based on reasonable assumptions and reflect the judgement of EVN's management based on factors currently known by it.

No assurance can be given that these forward-looking statements will prove accurate and correct, or that anticipated, projected future results will be achieved.

For additional information regarding risks, investors are referred to EVN's latest Annual report.

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