EVN AG — Interim / Quarterly Report 2018

Aug 23, 2018

EVN conference callQ. 1-3 2017/18 results

23 August 2018

• EUR 38m positive non-cash effect from higher valuation of hedges as of 30 June 2018
• Solid development of business
• Increase of renewable electricity generation by 11.5%
• Continuing high demand for electricity from thermal generation to support network stability
• Volume and price effects weigh on natural gas distribution business in Lower Austria
• Significantly milder temperatures especially in South Eastern Europe
• Completion of three wastewater projects in Macedonia (until July 2018)

Key financials Q. 1-3 2017/18

	Q 1- 3 2 0 1 7 / 1 8	/– +
	E U Rm	%
Re ve nu e	1, 6 5 0. 3	-6 5
E B I T D A	5 8 5. 0	-3 0
d De ia io isa io t t t p re c n a n am or n	-1 9 2. 8	1. 7
f fe fro im irm E ts t te ts c m p a en s	-5 1	9 5. 2
E B I T	3 8 7. 2	2 8. 6
l re l ina ia F ts nc su	-1 4. 7	-8 8. 6
l G t t ro up n e re su	2 7 3. 2	1 2. 9

h f low fro Ne t c as m
ing iv i ies t t t op er a a c	3 5 1. 9	-7 5
1) Inv tm ts es en	2 0 5. 1	9. 8 1
de b Ne t t	1, 0 2 0. 8	-2 0. 6
	%
2) Eq i io ty t ra u	5 1. 7	4. 2

1)In intangible assets and property, plant and equipment

2)Changes reported in percentage points

Decline in revenue

• Thermal electricity generation below high prior year level and reduced natural gas trading activities
• Temperature-related drop in revenue in South Eastern Europe
• Decline from international project business

Lower EBITDA

• Two contrasting one-offs in prior year
• Decreased operating expenses
• Valuation gains on hedges

Improvement in EBIT and Group net result

Prior year influenced by impairment losses

Solid balance sheet structure, reduced net debt

• Reduction of net debt to EUR 1,020.8m (30 September 2017: EUR 1,213.2m)
• Gearing decreased from 38.5% to 28.4%

EBITDA development by segments

Conference call Q. 1-3 2017/18 results

Generation

	Q. 1- 3 2 0 1 7 / 1 8	/– +
le ic i io lu E tr ty t c g en er a n vo m es	GW h	%
l To ta	3, 7 1 5	-1 4. 4
b le Re ne w a en er g y so ur ce s	1, 4 1 6	1 0. 2
he l e T rm a ne rg y so ur ce s	2, 2 9 9	-2 4. 7

	Q. 1- 3 2 0 1 7 / 1 8	/– +
in ia l p fo F an c er rm an ce	EU Rm	%
Re ve nu e	2 2. 1 4	9 1 1.
E B I T D A	1 2 4. 9	4 8. 0
E B I T	8 5. 3	–

Increased renewable generation

Strong water flows and continuous expansion of windpower capacities

Decline in thermal production

Increased revenue

• Higher renewable generation
• Positive effects from contractual reserve capacities for network stability

Improvements in EBITDA and EBIT

• Lower expenses for primary energy carriers
• Prior year influenced from impairment losses

Energy

l lu S t a e s v o m e s o	Q 1- 3 2 0 1 7 / 1 8	/– +
d t e n c u s o m e r s	h G W	%
l i i E t t e c r c y	5, 3 9 3	7. 9
l N t a u r a g a s	4, 7 9 6	-9 7
H t e a	1, 7 4 1	-2 0

	Q 1- 3 2 0 1 7 / 1 8	/–
f i i l F n a n c a p e r o r m a n c e	E U Rm	+ %
R e v e nu e	3 8 3. 4	-1 2. 2
E B I T D A	1 1 1. 4	1 7. 4
E B I T	9 6. 7	2 6. 5

Different development of energy sales volumes

• Higher electricity sales volumes
• Weather-related decline in natural gas and heat sales volumes

Revenue dropped y-o-y

• Decrease in marketing of own thermal generation
• Reduced natural gas trading activities

EBITDA and EBIT above previous year

Valuation gains on hedges

Networks

k d i i b i N t t t e o r s r o n w u	Q 1- 3 2 0 1 7 / 1 8	/– +
lu v o m e s	h G W	%
l E i i t t e c r c y	6, 5 7 5	1. 6
1) l N t a u r a g a s	1 4, 5 2 2	-1 0. 7

	Q 1- 3 2 0 1 7 / 1 8	/– +
i i l f F n a n c a p e r o r m a n c e	E U Rm	%
R e v e nu e	4 3 4. 6	-1 9
E B I T D A	2 2 3. 1	-1 1. 6
E B I T	1 3 5. 2	-1 8. 8

1) Including network sales to EVN's power stations

Different development of network distribution volumes

• Increase in electricity supported by sound economy
• Decline in natural gas due to the reduced use of thermal power plants in Lower Austria

Revenue below previous year

Negative volume and price effects

EBITDA and EBIT declined y-o-y

• Increased operating expenses due to higher upstream costs for network stabilisation
• New regulatory period for natural gas distribution networks as of 1 January 2018

South East Europe

b i K e y e n e r g y u s n e s s	Q 1- 3 2 0 1 7 / 1 8	/– +
i d i t n c a o r s	h G W	%
le lu E ic i io t ty t c r g e ne ra n vo m e s	3 1 2	-1 3. 6
k d bu lu is i io Ne tw t t o r r n vo m e s	0, 2 1 7 1	9 -1
le le lu ic i E t ty c r s a s v o m e s	8, 8 1 6	-6 3
le lu He t a s a s v o m e s	1 9 5	-1 0. 8

	Q 1- 3 2 0 1 7 / 1 8	/– +
l f i i F n a n c a p e r o r m a n c e	E U Rm	%
Re ve nu e	7 0 7. 4	-4 6
E B I T D A	6 9. 3	-4 8. 0
E B I T	2 2. 5	-6 2. 2

Business development suffers from milder winter

• Temperature-related decline in network distribution and energy sales volumes
• Revenue dropped y-o-y

Decline in EBITDA and EBIT

Prior year positively influenced by nonrecurring effect from settlement with Bulgarian NEK

Environment

	Q 1- 3 2 0 1 7 / 1 8	/– +
l f i i F n a n c a p e r o r m a n c e	E U Rm	%
R e e nu e v	1 2 5. 0	-1 7. 5
E B I T D A	1 9. 8	–
E B I T	2. 7	–
l l F i i t n a n c a r e s s u	-0 2	8 3. 4
l b f R i t t e s u e o r e n c o m e a x	2. 5	–

Decline in revenue

Less dynamic development of international project business

EBITDA and EBIT above prior year

Previous year affected by negative nonrecurring effect (valuation allowance on inventories)

Cash flows

	Q. 3 2 0 8 1- 1 7 / 1	/– +
	EU Rm	in %
h f low Gr os s c as	5 0 7. 2	-0 2
h f low fro ing iv i ies Ne t c t t t as m op era a c	3 5 1. 9	-7 5
h f low fro inv ing iv i ies Ne t c t t t as m es a c	-2 3 9. 4	–
h f low fro f ina ing iv i ies Ne t c t t as m nc a c	-1 2 9. 7	6 4. 2
ha h d h Ne in t c ng e ca s an ca s
iva len ts eq u	-1 7. 3	–

CF from operating activities

• Reclassification of leasing receivables to trade receivables
• Prior year negatively affected by the arbitration decision for Walsum, however corresponding positive effect was contained in CF from investing activities

CF from investing activities

Higher investments and a rise in shortterm securities

CF from financing activities

• Dividend payments

• Scheduled repayments of loans

• Group net result for 2017/18 expected to be at levels comparable to last year's Group net result

• Effects of valuations of hedges on the full-year Group net result will depend on energy prices as of the valuation date on 30 September 2018
• Factors that could influence the Group net result include
• Regulatory background
• Proceedings currently in progress in Bulgaria
• Remaining proceeding over the Walsum 10 power plant project
• Progress on activities in Moscow
• Presentation of FY 2017/18 results
• 13 December 2018

Contact details

Stefan Szyszkowitz, CEO

• IR contact partners:
• Gerald Reidinger
• Matthias Neumüller
• Doris Lohwasser
• Karin Krammer
• IR contact details
• E-mail: investor.relations@evn.at
• Phone: +43 2236 200-12128
• Phone: +43 2236 200-12473

• Phone: +43 2236 200-12867

• Information on the internet

• www.evn.at
• www.investor.evn.at
• www.responsibility.evn.at
• Headquarters of EVN AG
• EVN Platz 2344 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.