EVN AG — Earnings Release 2008

Feb 28, 2008

News Details

Corporate | 28 February 2008 08:00

EVN AG: Development of business in the first quarter of 2007/08

EVN AG / Quarter Results/Quarter Results

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Development of business in the first quarter of 2007/08
(October 1 – December 31, 2007)

Weather-related increase in Energy segment sales volumes and revenue
Majority shareholding in Rohöl-Aufsuchungs AG
Initial consolidation of the Bulgarian district heating plant in
Plovdiv
Acquisition of the Sunny Beach AD electricity distribution facilities
in Bulgaria
Antitrust approval of the district heating cooperation in
Sankt Poelten

2007/08
Q. 1 Change in
EUR m %
Revenue 667.7 +9.1
EBITDA 1 36.8 +16.5
Results from operating activities
(EBIT) 92.0 +22.0
Group net profit 77.6 +5.7

The business environment in the energy sector in the period October –
December 2007 was characterised by significantly lower temperatures
compared to the comparison period of the previous year, increasing
wholesale electricity and primary energy prices, strong economic growth in
Austria, and a continuation of the very dynamic economic expansion in South
East Europe.

Against this backdrop, total revenue of the EVN Group was up 9.1% in the
1st quarter 2007/08, to EUR 667.7m. Earnings improved even more, with the
results from operating activities increasing by 22.0%, to EUR 92.0m.
Although the financial results did not match the high level achieved in the
preceding year, the Group net profit climbed by 5.7%, to EUR 77.6m.

International expansion continued
In the Bulgarian region which EVN supplies with electricity, the EVN Group
acquired and initially consolidated the district heating plant EVN Bulgaria
Toplofikatsia EAD (TEZ Plovdiv), which has a total heat generation capacity
of 1,259 MW thermally and 86 MW electrically. In October 2007, the EVN
Group acquired the electricity distribution facilities of the local
electricity distribution company Sunny Beach AD on the Black Sea from EVN
Bulgaria EP AD, thus fulfilling the terms of the original privatisation
agreement.

At the end of January 2008, the Albanian government selected EVN as the
preferred bidder in an international tender for the granting of a
concession to construct hydroelectric power plants on the Devoll River.

The purchase of an additional shareholding in Rohöl-Aufsuchungs AG was
formally approved by antitrust authorities during the 1st quarter 2007/08.
As a result, EVN now has a majority shareholding, or 50.03%, in
Rohöl-Aufsuchungs AG and continues to consolidate this shareholding at
equity, due to a contractual stipulation which does not permit EVN to exert
a controlling influence on the company.

Revenue and results
In the 1st quarter 2007/08, the EVN Group raised its total revenue by 9.1%,
to EUR 667.7m. The Energy segment, which profited from lower temperatures
in comparison to the preceding year, was completely responsible for this
development. The Environmental Services segment, which is subject to
project-related fluctuations, posted a decline in revenue.

The results from operating activities (EBIT) rose more impressively than
total revenue increased, climbing 22.0% in the 1st quarter 2007/08, to EUR
92.0m. The EBIT margin improved year-on-year from 12.3% to 13.8%. The EBIT
of the Energy segment climbed 34.4%, to EUR 90.4m, whereas the EBIT of the
Environmental Services segment declined from EUR 8.9m, to EUR 3.1m.

The financial results of the EVN Group in the 1st quarter of the 2007/08
financial year declined significantly, by EUR 13.8m to EUR 11.0m. Higher
interest income from project financing receivables could not compensate for
the lower income from other investments, increased interest expense and
lower income from investments in securities and current financial assets.

As a consequence of these developments, the profit before income tax of the
EVN Group in the 1st quarter 2007/08 amounted to EUR 102.9m, a rise of 2.7%
compared to the previous year. Driven by a decrease in the income tax
expense and a reduction in the minority interest, the Group net profit
increased more substantially than the profit before income tax, rising by
5.7%, to a total of EUR 77.6m.

Since the last balance sheet date on September 30, 2007, the balance sheet
total of the EVN Group rose by 8.7%, to EUR 6,809.8m. Equity climbed by
10.3%, to EUR 3,325.7m, which in turn led to an increase in the equity
ratio from 48.1% to 48.8%. Taking account of the total net debt amounting
to EUR 959.8m, the gearing of the EVN Group amounted to 28.9%, which
continues to be well below the energy sector average.

Revenue and sales volumes in the Energy segment
The external revenue of the Energy segment rose 15.4%, to EUR 626.9m,
during the period under review. This can primarily be attributed to the
comparatively colder temperatures in relation to the 1st quarter 2006/07.
The EBIT of the Generation as well as the Energy Procurement and Supply
business units improved compared to the preceding year, whereas the EBIT of
the Networks business unit remained stable.

Project-related decline in Environmental Services revenues
In the 1st quarter 2007/08, total revenue of the Environmental Services
segment declined by EUR 28.1m, to EUR 35.3m. The completion of the large
waste incineration facility in Moscow was only partially offset by the
start of various new smaller projects. The profit before income tax fell by
EUR 2.5m, to EUR 5.9m.

On January 30, 2008, WTE won a contract to modernise and expand a
wastewater purification facility in the Polish capital of Warsaw, as part
of a consortium with Veolia. The large project will raise total capacity to
450,000 m³ per day, corresponding to 2.1 million population equivalents,
effectively doubling the wastewater treatment capacity of the existing
plant. As a result, it will become Poland’s largest wastewater purification
installation.

Outlook
Despite the improvement in the results from operating activities in the 1st
quarter of the 2007/08 financial year, it will be difficult to match the
record results posted in the previous year. In the Energy segment, the
strong price rises for primary energy will further increase pressure on
margins, and thus lead to a reduced use of EVN’s own thermal power plants.
New projects in the Environmental Services segment will partially be
delayed until the second half of the financial year.

In terms of investments, the energy concept for the Lower Austrian Central
Region will be continued as planned. In order to ensure secure energy
supplies despite growing demand, investments in Lower Austria’s electricity
and gas networks will continue at a high level. Similarly, the investment
programme designed to modernise and expand the distribution networks in
South East Europe will also proceed as scheduled.

The complete Letter to Shareholders Q. 1 2007/08 is available at
www.investor.evn.at.

EVN AG
Corporate Communications
EVN Platz
A-2344 Maria Enzersdorf
Tel.: +43 2236 / 200 - 12294
Fax.: +43 2236 / 200 - 82294
mobile +43 676 / 810 - 32294
stefan.zach@evn.at

28.02.2008 Financial News transmitted by DGAP

Language: English
Issuer: EVN AG
EVN Platz
2344 Maria Enzersdorf
Österreich
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

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