VERBUND AG — Earnings Release 2014

Jul 30, 2014

News Details

Ad-hoc | 30 July 2014 08:00

VERBUND AG: result for quarters 1-2/2014: Prices, water supply and expenses for the restructuring of the thermal portfolio weigh on result

VERBUND AG / Key word(s): Half Year Results/Interim Report

30.07.2014 08:00

Dissemination of an Ad hoc announcement, transmitted by DGAP - a service of
EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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The dramatic transformation of the European electricity markets is still
ongoing. Profitability of conventional generation facilities in Europe is
rapidly declining. The situation of gas power plants is a particularly
precarious one. In May, VERBUND approved the restructuring of thermal
generation. This includes the temporary decommissioning of the combined
cycle gas turbine power plants in Mellach, Austria, as well as in
Pont-sur-Sambre and Toul in France. In addition, the Dürnrohr hard coal
power plant and the Neudorf/Werndorf oil-fired district heating plant will
be closed.

Despite the measures that have been introduced, the results are showing a
decline. EBITDA fell to EUR354.8m, and the Group result fell to EUR56.6m.
The sharp decrease is primarily attributable to the considerable, positive
non-recurring effects in 2013 resulting from the asset swap with E.ON. But
even adjusted for these non-recurring effects, results are lower. Adjusted
EBITDA declined by 33.4% to EUR421.0m, and the Group result fell by 60.7%
to EUR93.6m. There are three main reasons for this: substantially lower
hydropower generation due to lower water supply, the even lower wholesale
prices for electricity as well as non-recurring expenses for thermal power
plants.

Based on average own generation from hydropower in the second half of the
year, our expectations now are for EBITDA to be approximately EUR690m and
the Group result to be approximately EUR70m for financial year 2014. The
planned payout ratio for 2014 remains at approximately 50% of the Group
result of approximately EUR150m after adjustment for non-recurring effects.

Key figures Unit Q1-2/2013 Q1-2/2014 Change
Revenue EURm 1,648.3 1,398.8 -15.1%
EBITDA EURm 806.2 354.8 -56.0%
Operating result EURm -78.7 196.7 -
Group result EURm 406.4 56.6 -86.1%
Earnings per share EUR 1.17 0.16 -86.1%
EBIT margin % -4.8 14.1 -
EBITDA margin % 48.9 25.4 -
Cash flow from
operating activities EURm 483.7 345.0 -28.7%
Free cash flow EURm 483.9 -322.8 -
Gearing % 73.8 78.2 -

Since 1 January 2014, IFRS 11 "Joint Arrangements" has replaced the
previous rules under IAS 31 "Interests in Joint Ventures". As a result of
the new rules, the interest in Ennskraftwerke Aktiengesellschaft is to be
classified as a joint operation. Thus, previously reported figures have
been adjusted.
Although the result attributable to the French combined cycle gas turbine
power plants is to be presented separately from continuing operations in
accordance with IFRS 5, to enhance comparability, the key figures relate to
the combined result from the Group's continuing and discontinued
operations.
Further information as well as the interim report for quarters 1-2/2014 can
be found at www.verbund.com > Investor Relations > Current financial
result.

Contact:
Andreas Wollein
Head of Group Finance and Investor Relations
T.: +43 (0)5 03 13 - 52604
F.: +43 (0)5 03 13 - 52694
mailto:investor@verbund.com

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Language: English
Company: VERBUND AG
Am Hof 6A
1010 Wien
Austria
Phone: 0043-1-53113-52616
Fax: 0043-1-53113-52694
E-mail: investor@verbund.com
Internet: www.verbund.com
ISIN: AT0000746409
WKN: 877738
Indices: ATX
Listed: Wien (Amtlicher Handel / Official Market)

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