evn company presentation€¦ · #1 green energy producer in austria and local gas distributor...

EVN Company presentation January 2014

Agenda

EVN at a glance

Market environment & Strategy

EVN’s success drivers

Outlook

Appendix

− Management Board

− Description of segments

− RAG

− Investments and projects

− Financial performance 2012/13

− Contact details

2

EVN profile

Shareholder structure

(as of 30.09.2013)

Leading integrated energy and

environmental services company

serving customers in Lower Austria,

SEE and CEE

Key activities

− Energy generation (renewable, thermal)

− Regulated grid (electricity, natural gas)

− Energy supply

− Environmental services

3 EVN at a glance

EVN at a glance

Energy Business – 6 Countries

4 EVN at a glance

Albania *

Austria

Bulgaria

Croatia

Germany **

Macedonia

* EVN share: 50%

** EVN share: 49%

EVN at a glance

Environmental Services Business – 18 Countries

5 EVN at a glance

Austria*

Bahrain

Croatia

Cyprus

Czech Republic

Denmark

Estonia

Germany

Lithuania

Latvia

Montenegro

Poland

Romania

Russia**

Serbia

Slovakia

Slovenia

Turkey

* Thermal waste incineration plant, drinking water supply

** Thermal waste incineration plant

6

Strategic investments

#1 electricity producer in Austria with 8.6 GW installed capacity (encompasses ~1% of shares held by WEEV) 13 run-of-river plants with 312 MW installed capacity (EVN stake: 41 MW) #1 green energy producer in Austria and local gas distributor

#2 oil and gas producer in Austria, one of the largest gas storage operators in Central Europe with 5bn m³ working gas capacity Distributor and business-to-business natural gas supplier in Austria

EVN at a glance

12.63%

13.0%

73.63%

50.03%

16.51%

Verbund-Innkraftwerke GmbH

6 EVN at a glance

EVN at a glance

Lower Austria – EVN’s prosperous domestic market

7 EVN at a glance

Sources: Statistics Austria; Eurostat

Province of Lower Austria at a glance:

Area: 19,186 km2 (~ half size of Switzerland)

Population (2012) 1,617,455

Economically active population, 15-64 years (2012):

73.5% (Austria: 72.5%)

GDP per capita (2010):

EUR 28,200 (Austria: EUR 31,100; Germany: EUR 29,000)

EVN at a glance

Bulgaria – EVN’s focus in SEE

8 EVN at a glance

Bulgaria at a glance:

Area: 111,000 km2

EVN's supply area: ~42,000 km2 (~ size of Switzerland)

Population (2011) 7,364,570

Economically active population, 15-64 years (2011)

65.3% (Austria: 72.5%)

GDP per capita (2010)


Sources: Eurostat, Bulgarian National Statistical Institute

EVN at a glance

Macedonia – EVN’s focus in SEE

9 EVN at a glance

Macedonia at a glance:

Area: 25,713 km2

EVN's supply area: 25,713 km2

Population (2011) 2,057,284

Economically active population, 15-64 years (2011):

63.9% (Austria: 72.5%)

GDP per capita (2010)


Sources: Eurostat, Macedonian State Statistical Office

EVN at a glance

Contribution by business segments

Revenue split1) EBITDA split1)2)

1) Pre consolidation 2) Figures have been adjusted due to IAS 19

10 EVN at a glance

11

Financial figures

11

1) Figure for 2011/12 has been adjusted due to IAS 19 2) In intangible assets and property, plant and equipment

EVN at a glance

EVN at a glance

EURm

y-o-y

2011/12 2012/13 in %

Revenue 2,755.0 –3.2 2,846.5

EBITDA1) 457.6 –3.6 474.5

EBIT1) 218.5 –2.1 223.2

Group net profit 114.7 –41.2 194.9

Net cash flow from operating activities 561.7 21.8 461.0

Investments2) 328.4 6.5 308.3

Balance sheet total 7,102.1 3.5 6,863.2

Equity 3,066.5 1.8 3,013.7

Equity ratio 43.2 –0.7 43.9%

Net debt 1,562.3 –8.3 1,703.7

Gearing 50.9% –5.6 56.5%

The EVN share

12 EVN at a glance

Basic Information

Share Capital EUR 330,000,000

Denomination 179,878,402 shares

ISIN AT000741053

Tickers EVNV.VI (Reuters); EVN AV (Bloomberg);

EVN (Dow Jones); EVNVY (ADR)

Agenda

EVN at a glance



Outlook

Appendix



− RAG



− Contact details

13

Market environment

Distorted energy markets

− Market design under discussion

− Increasing share of volatile renewable production supported by

subsidised feed in tariffs

− Deterioration of wholesale electricity prices

Uncertainty in economic environment

− Weak economic growth

Political instability

− especially in South Eastern Europe

14 Market environment & Strategy

Energy price developments

15 Source: EVN; December 2013


Network Electricity Gas Comments

Regulatory authority E-Control GmbH E-Control GmbH

Start of the regulatory period 01.01.2014 01.01.2013

Next regulatory adjustment 01.01.2019 01.01.2018 Adjustment of WACC and productivity factors

Duration of the regulatory period 5 years 5 years

Regulatory method Revenue caps Revenue caps

RAB (EURm) Not public Not public Annual investments are added to the RAB in the following

year

WACC (pre-tax, nominal) 6.42% 6.42% Set for length of regulatory period

General productivity factor 1.25% 1.95%

Electricity: 50% of the achieved productivity increases

are passed on to end customers during the regulatory

period

Natural gas: Gains from cost reductions remain with the

company during the regulatory period

Company specific productivity factor 0.36% 0.00% Additional X factor is company specific

Inflation Set annually Set annually Network operator price index consists of consumer (30%)

and building price (40%) indices as well as wage increase

index

16

Regulated business in Austria EVN at a glance


17

Regulated business in South Eastern Europe

Electricity Bulgaria1)

(electricity) Bulgaria (heat)

Macedonia (electricity)

Regulatory authority SEWRC

(State Energy and Water Regulatory Commission)

SEWRC (State Energy and Water Regulatory Commission)

ERC (Energy Regulatory Commission)

Start of the regulatory period 01.08.2013 01.08.2012 01.01.2012

Next regulatory adjustment 01.08.2015 01.08.2014 01.01.2015

Duration of the regulatory period 2 years 1 year 3 years

Regulatory method2) Revenue caps Revenue caps Revenue caps

RAB (EURm) Not public Not public Not public

WACC (pre-tax, nominal) 7.0% 7.6% 6.7%

Recognised network losses 10.0% No 14.0%

Productivity factor Yes Yes No

Investment factor3) No No Yes

EVN at a glance

1) Regulatory decision based on new energy law still pending. 2) The revenue caps comprise the recognised operating expenses, the amortisation and depreciation as well as the recognised return on the RAB. 3) Annual review and approval of company’s investment plans by the regulatory authority. Source: Regulators in Bulgaria (SEWRC) and in Macedonia (ERC)


EVN‘s position within the value chain in SEE

Price development in Bulgaria (EUR1)/MWh) Price development in Macedonia (EUR2)/MWh)

18

EVN operates the distribution network based on a RAB framework

Public Provider End customers

EVN sells electricity at regulated tariffs to end customers

Distribution

EVN is obliged to source electricity from the public provider at regulated prices

Public Provider

Source: Regulators in Bulgaria (SEWRC) and in Macedonia (ERC) 1) Exchange rate Bulgaria: EUR/BGN 1.956 2) Exchange rate Macedonia: EUR/MKD 61.5 Market environment & Strategy

Tariff schemes 2013 for renewable energy sources

19

Renewable energy source Austria Bulgaria

Wind

Tariff category Feed-in-tariffs Feed-in-tariffs

Tariff (EUR-cent1)/kWh) 9.45 ~6.11–6.84

Duration (in years) 13 12

Installed capacity 20122) (MW) 1,380 660

Target value for installed capacity 2020 (MW) 2,578 1,440

Water


Tariff (EUR-cent1)/kWh) 3.23–10.55 ~4.77–9.59


Installed capacity 20122) (MW) 8,285 3,181

Target value for installed capacity 2020 (MW) 8,998 3,288

Photovoltaic


Tariff (EUR-cent1)/kWh) 16.59–18.12 ~8.60–19.30


Installed capacity 20122) (MW) 410 840

Target value for installed capacity 2020 (MW) 322 303

Source: Investieren in Erneuerbare Energie 2013, Kommunalkredit 1) In countries with tariffs in local currencies, tariffs have been converted with the exchange rate as of 01.02.2013. 2) “Installed capacity 2012” relates to estimates and assumptions due to available information as of 01.02.2013. Market environment & Strategy

Strategy

Virtue of integrated business model

Focus on region of Lower Austria

Provider of high quality services

− electricity, gas, water, cable TV, telecommunication,

wastewater treatment, waste incineration

Focus on stable business

− regulated and non-regulated

Provide consistent dividends

Upside potential in

− Renewable energy production (mainly wind)

− South Eastern Europe

− Environmental services


Agenda

EVN at a glance



Outlook

Appendix



− RAG



− Contact details

21

22

EVN‘s success drivers EVN at a glance

SD 1 Solid home market

SD 2 Strong market position

SD 3 High share of earnings from regulated and stable business

SD 4 Upside potential in SEE

SD 5 Diversification through environmental business

SD 6 Strategic investments

SD 7 Solid capital structure

22 EVN’s success drivers

SD 1: Solid home market

The Austrian electricity market continues to

be stable1)

− Increase in number of households

(more senior citizens and single households)

− Increase in demand for transport sector, lightning,

electronic data processing applications, heating and

air conditioning

Outlook electricity consumption in Lower

Austria2)

23

1) Source: European Network of Transmission System Operators for Electricity (www.entsoe.eu) 2) Source: EVN

Source: European Network of Transmission System Operators for Electricity (www.entsoe.eu)

in TWh Austria Germany

2012 (Jan-Aug) 45.8 358.4

2013 (Jan-Aug) 46.0 330.4

Change (%) 0.44% -7.81%

Electricity Consumption in


SD 1: Characteristics of Austrian utility market

No nuclear power generation

− Public vote in the 1970s against nuclear power

High share of hydropower assets

− 58%1) of Austrian electricity generation sourced from hydropower

− In 2012, #1 in EU at share of renewable energy sources in electricity generation2)

(73% of Austrian electricity generation sourced from renewable energies)

− Further projects in realisation

1) Source: Oesterreichs Energie (www.oesterreichsenergie.at); data from 2011 2) Source: Energiestatus Österreich 2012, Bundesministerium für Wirtschaft, Familie und Jugend

EVN’s success drivers 24

http://www.oesterreichsenergie.at/

SD 1: Characteristics of Austrian utility market

Low customer churn rates1)

Electricity market 2012:

− Churn rate of Austrian end customers: 1,1%

− 5 largest suppliers hold more than 2/3 of market share

Gas market 2012:

− Churn rate of Austrian end customers: 1,7%

− 5 largest suppliers hold 81% of market share

Low political risk

− Transparent and predictable regulatory framework

− High proportion of public ownership (regulated by law)

− Public views utilities as basic public service

No major foreign competition of suppliers

− Fairly small market size with prices at EU average

1) Source: E-Control: Marktbericht 2013, Nationaler Bericht an die Europäische Kommission

EVN’s success drivers 25

SD 2: Strong market position in Austria

59 TWh 97 TWh 16 TWh 8.1 TWh

Source market shares: E-Control 2012, annual report and company numbers, approximate figures for 2011/12 Source churn rates: E-Control, market statistics – consumer attitude/churn rates electricity and gas according to network areas


EVN is 45% shareholder in

EnergieAllianzAustria

~37,000 industrial and business

customers (electricity and gas)

Distribution channels:

− Direct sales (branches and offices in Germany)

− Sales partners of EEA GmbH

SD 2: Activities in Germany

16.8 TWh 18.0 TWh


SD 2: Decentralised renewable production portfolio

#2 wind producer in Austria

Strong, de-centralised portfolio:

Hydropower (Austria)

– 5 storage and 67 run-of-river hydropower plants

– Purchasing rights from hydropower plants along the Danube, Melk, Greifenstein and Freudenau

– Investment in hydropower plant Nussdorf and Verbund-Innkraftwerke

Windpower

– 14 windparks – Investments: EUR ~300m


SD 2: Wide-spread heat and biomass portfolio

#1 in biomass heating in Austria

5% of Group revenues and

6% of EBITDA

Biomass portfolio

− More than 60 biomass plants in Lower Austria

− Investments (in total): EUR 390m

− Contract duration: ø 15 years

Heat extraction from EVN AG’s

thermal power plants

Index pricing ensures business provides

stable margins and is cash flow

generative


SD 2: Drinking water supply

#1 drinking water supplier in Lower

Austria (50 years of experience)

1% of Group revenue and

3% of Group EBITDA

Operation of 36 local drinking water

supply networks

More than 500,000 customers

− thereof 83,500 directly supplied


SD 3: High share of earnings from regulated and stable business

Regulated business

− Grid in Austria

− Grid, supply and heating in SEE

31

Stable business

− Cable TV & telecommunication (5.5%)

− Waste incineration in Lower Austria (6.3%)

− Water supply business in Lower Austria (2.9%)

− Heating business in Lower Austria (6.3%)

Majority of EBITDA (85%) derives from regulated or stable earnings


32

SD 3: Geographic split of revenues and EBITDA

32

1) Figures for 2011/12 have been adjusted due to IAS 19

Geographic revenue split Geographic EBITDA split1)

EVN at a glance


SD 4: Upside potential from South Eastern European market development

33

33

Improvement of grid efficiency

1) In %, basis: Lower Austria = 100%

Illustrative electricity sales volumes per customer1)

Electricity prices for households (EUR cent/kWh)

EVN at a glance


34

SD 5: Diversification through environmental business

EVN designs and constructs

− drinking water plants

− waste water treatment plants

− thermal waste incineration plants

100 projects in 18 countries since 1983

− 9 projects currently under construction

Strong demand for infrastructure projects set to continue

Total order volume of EUR 540m with attractive return

potential from international projects

Underpinned by stable contributions from drinking water

supply and wastewater treatment businesses

34

EVN at a glance


SD 5: Project types

35

PPP project Turn-key project

Scope of activities

Design

Construct/build

Operate

Structure financing

Own part or all of equity

Design

Construct/build

Operate (optional)

Contract length 10–30 years 1–3 years (designing & building)

5–15 years (operations)

Capital intensity High Low

Return characteristics

Design and build – Percentage of completion (POC)

Operations – recurring annual revenues

Capital charge payment (recurring or one-time payment)

Design and build – POC

Operations – recurring annual revenues

Financing Non-recourse financing to EVN post construction period

None to EVN – done by customer

Market characteristics High barrier to entry due to necessary project management expertise and high capital demands for financing

Low barrier to entry – intensive competition driving margins down


36

SD 6: Strategic Investments

Significant contribution to EVN’s net

profit

RAG and Verbund are the main

contributors

Income from RAG increased by 9% from

EUR 73.5m in 2011/12 to EUR 80.1m in

2012/13

Contribution from Verbund above prior-

year level

EVN at a glance


37

SD 7: Solid capital structure

Stable equity ratio

Decreasing net debt and gearing

ratio

Rating

− S&P: BBB+ / stable (confirmed: 01.03.2013)

− Moody’s: A3 / stable (confirmed: 25.06.2013)

EVN aims at preserving a

competitive investment grade

credit rating

EVN at a glance


38

SD 7: Debt maturity profile

Liquidity reserves

− Syndicated loan of EUR 500m

− Committed bilateral credit lines of EUR

175.0m

Long-term refinancing contract with

EIB

− EUR 150m, 25 years

− Financing of grid investments

EVN at a glance


39

SD 7: Financial policy and dividends

Financial policy going forward based on

selected key ratios (unadjusted):

– Equity ratio > 40% (30.09.2013: 43.2%)

– Net debt coverage (FFO) ≥ 30% (30.09.2013: 44.2%)

– Interest cover (FFO) ≥ 5x (30.09.2013: 8.2x)

Dividend: EVN follows a stable dividend

policy

EVN at a glance


Agenda

EVN at a glance



Outlook

Appendix



− RAG



− Contact details

40

Outlook

On energy markets

− Persistent distortions

− Low wholesale prices

− Volatility in production

On EVN

− Focus on stability of results and dividends

− Focus on core regions

− Focus on security of supply

− Upside from renewable energy production, SEE, environmental

services

41 Outlook

Appendix

42

Agenda

EVN at a glance



Outlook

Appendix



− RAG



− Contact details

43

44

EVN‘s Management Board

Peter Layr, Spokesman of the Executive Board

Born in 1953. Doctorate in Technical Science. Joined EVN in 1978.

Member of the EVN Executive Board since October 1999. Named Spokesman of the EVN Executive Board in January 2011.

His term of office expires on 30 September 2019.

Stefan Szyszkowitz, Member of the Executive Board

Born in 1964, Master of Law, Master of Business Administration. Joined EVN in 1993.

Member of the Executive Board since January 2011.

His term of office expires on 19 January 2016.

© VERBUND

Investments and projects

44 Management Board

Agenda

EVN at a glance



Outlook

Appendix



− RAG



− Contact details

45

EVN – a fully integrated utility player

• Electricity generation from thermal sources and renewable energies (Austria, Germany, Albania and Bulgaria)

Generation

• Procurement of electricity and primary energy sources (Austria and Germany)

• Trading and selling of electricity and natural gas to end customers and on wholesale markets (Austria and Germany)

• Heat generation and sales (Austria)

Energy Trade and Supply

• Operation of regional electricity and natural gas networks (Austria)

• Cable TV and telecommunications networks (Austria)

Network Infrastructure Austria

• Operation of electricity networks and electricity sales (Bulgaria and Macedonia)

• Heat generation and heat sales (Bulgaria); Electricity production (Macedonia)

• Construction and operation of natural gas networks (Croatia)

• Energy trading within the whole region

Energy Supply South East Europe

• Drinking water supply, wastewater disposal, thermal waste incineration (Austria)

• Combined cycle heat and power co-generation plants

• International project business

Environmental Services

46 Description of segments

Agenda

EVN at a glance



Outlook

Appendix



− RAG



− Contact details

47

111.0 141.6

107.0

149.9

188.0

160.9

79.1 103.0

70.8

0

50

100

150

200

2010 2011 2012

EURm

EBIT EBITDA Net profit

54% 50% 55%

23% 31%

30% 22%

18%

14%

1%

1%

2%

339.8

381.2

441.0

0

50

100

150

200

250

300

350

400

450

500

2010 2011 2012EU

Rm

Other revenues

Oil sales & stockpiling of CER

Gas storage

Gas sales

EBITDA, EBIT and Net profit

48

Case Study: RAG – Rohöl-Aufsuchungs AG1)

48

1) Source: RAG, Annual report 2012 according to IFRS CER = Compulsory Emergency Reserves

EVN at a glance

Shareholder structure Revenue breakdown by segments

E.ON Global Commodities

SE 29.98%

Steirische Gas-Wärme GmbH

10% Salzburg AG

10%

EVN 50.03%

RAG

49

Case Study: RAG – Rohöl-Aufsuchungs AG1)

Core areas of business

Oil and natural gas E&P Natural gas storage

Concessions

Austria (5,414 km²) Germany (5,479 km²) Hungary (7,022 km²) Poland (2,951 km²) Romania (1,106 km²)

Storage facilities (Salzburg, Upper Austria)

Haidach (JV with Gazprom and Wingas; 2,656 m m³) Aigelsbrunn (100 m m³) Puchkirchen (1,080 m m³) 7Fields (1,165 m m³)

EVN at a glance

1) Source: RAG

2) Sales of produced, swapped and traded gas

49 RAG

Production statistics

2012

Gas production m m³ 406.6

Gas sales2) m m³ 816.5

Gas reserves m m³ 3,800

Oil production t 117,024

Oil reserves t 900,000

Oil tank storage capacity t 260,000

Natural gas storage

Capacity m m³ 5,001

Case Study: RAG – reflection in EVN Group results

EVN holds a 50.03% stake in RAG through its fully consolidated

subsidiary RAG-Beteiligungs-Aktiengesellschaft

100% of RAG earnings are recognised as share of profit of

equity accounted investees

49.97% of RAG earnings assigned to minority interest

EVN contractually not entitled to exercise a controlling influence

over RAG

50 RAG

Agenda

EVN at a glance



Outlook

Appendix



− RAG



− Contact details

51

52

1) In intangible assets and property, plant and equipment; Pre consolidation

Investments 2012/131)

Key investments

Network infrastructure Austria

Construction of gas pipeline Westschiene

Wind parks in Lower Austria

Expansion of heat networks and biomass capacities in Lower Austria

Expansion of the network infrastructure and replacement of metres in SEE

Investments in natural gas network in Croatia


52 Investments and projects

Power generation capacities of EVN power plants

53

Generation capacities from

renewable energy increased

by 110 MW or 25.3%

Generation capacities from

thermal power increased by

52 MW or 3.7%

Share of generation

capacities from renewable

energy at 27.0%


54

Ongoing projects to increase generation output

Project Walsum

Wind parks1) Gorna Arda

Fuel type Hard coal Wind Hydro

Pro-rata investment (EURm) 402 200 350

Expected COD Dec.2013 2015/16 20203)

1) Includes Austrian wind parks. 2) Depending on date of construction decision.

EVN at a glance

54

Leads to a coverage ratio of ~30%


55

Coverage ratio

Market entrance Bulgaria

Market entrance Macedonia

Generation mix

EVN at a glance

Growth perspective in renewable energy production

Increase coverage ratio in the

mid-term to 30% on Group level

Balanced integrated business model

Diversify generation portfolio

Keep renewable generation at 50%

Focus on wind in Austria


Coal-fired power plant in Duisburg-Walsum

Status

Commissioning after test phase in December 2013

Installed Capacity 725 MW

Duisburg-Walsum


Gas-fired power plants in Theiss and Korneuburg

Reserve capacity for Southern-Germany

Reserve capacity: 785 MW over the next 3 winter half-years

Supply upon request of Federal Network Agency of Germany (“Bundesnetzagentur”)

Securing the sites


58

Hydropower plant project in Bulgaria

Gorna Arda

70% EVN stake, 30% NEK (National Electricity Company in Bulgaria)

River Arda, South Eastern Bulgaria

Total capacity: 120 MW

Generation: ~350 GWh p.a.

Total investments: up to EUR 500.0m

Start of operations after 2020 (depending on date of construction decision)



59

Gas supply in Lower Austria

Südschiene

Gänserndorf-Semmering

Completion: July 2011

Gas pipeline: ~120 km

Investments: EUR 114.0m

Westschiene

Auersthal-Amstetten

Start of construction: June 2011

Completion: 2013/14 financial year

Gas pipeline: 143 km

Investments: EUR 150.0m


Westschiene

Südschiene


Lower Austria

60

Gas supply in Croatia

Concessions to build and operate a natural gas distribution network on the Dalmatian coast

Three counties: Zadar, Split and Sibenik

Concession period: 30 years

Total pipeline length: 1,450 km

~130,000 households

Start of construction: April 2011 (Zadar)



International environmental services projects

Projects

Wastewater treatment plant in Warsaw, Poland, started operations in March 2013

Wastewater treatment plant in Sentjernej, Slovenia, started operations in July 2013

Sludge treatment plant in Vilnius, Lithuania, started test operations

3 wastewater treatment plants in Romania under construction

Contract for construction of wastewater treatment plant in Krakow, Poland, received

Projects in Moscow delayed


Agenda

EVN at a glance



Outlook

Appendix



− RAG



− Contact details

62

Business development 2012/13

Key financials Operating results close to prior-year’s level

Group net profit down 41.2% due to negative effects in financial results

Strong balance sheet supports constant dividend proposal of EUR 0.42

Increase in generation capacity Expansion in windpower in Lower Austria

Stronger international hydropower footprint (Ashta, Macedonia)

Walsum gets connected to the grid

785 MW reserve capacity for Southern Germany Arbitration proceedings in Bulgaria No major progress in environmental projects in Moscow

Financial performance 2012/13 63

Key financials

Revenue close to prior-year’s level

Smaller number of final invoices in

international project business

Slight year-on-year increase in

energy business

EBITDA and EBIT remain robust

Lower cost of materials due to decline

in project volume in international

project business

Lower procurement costs for energy

Financial results dropped

Negative earnings contribution from

at equity accounted investees

EURm 2012/13 +/–

in %

Revenue 2,755.0 –3.2

EBITDA 457.6 –3.6

EBIT 218.5 –2.1

Financial results –38.1 –

Group net profit 114.7 –41.2

Net cash flow from operating activities 561.7 21.8

EUR

Earnings per share 0.64 –40.8


Equity ratio 43.2%

Increased current liabilities due to reclassification of bonds which will become due in 2013/14

Net Debt decreased by EUR 141.4m to EUR 1,562.3m

Gearing reduced to 50.9%

Standard & Poor’s and Moody’s rating confirmed (BBB+, A3) with stable outlook

Solid balance sheet structure


Financial results

Financial results dropped

2012/13: EUR –38.1m; 2011/12: EUR

36.5m

Significant reduction of income from

investments in equity accounted investees

EconGas: EUR –19.7m

Devoll: EUR –27.6m

WEEV: EUR –29.6m

Shkodra (Ashta): EUR –20.4m

Income from other investments slightly

improved

Stable interest results and other financial

results


Generation: on-going downward movement of electricity market prices

Energy Trade and Supply: temperature-related increase in sales volumes of natural gas and heat

Network Infrastructure Austria: increase in electricity distribution volumes

Energy Supply South East Europe: increase in tariffs, volume increase in electricity production

Environmental Services: less project completions

EBITDA development by segments

Generation Environmental Services





Generation

Renewable energy sources led to higher

generation volumes

Start of operations of Ashta, Albania

Higher procurement from Inn River

Good water flows

Decline in EBITDA and EBIT

Lower revenue

Continuing pressure on electricity prices

Unfavourable wind conditions

Lower option value of thermal power plants

Drop in depreciation and amortisation

Higher impairment losses last year

2012/13 +/–

in % Electricity generation volumes GWh

Total 3,021 7.7

Renewable energy sources 1,637 22.9

Thermal energy sources 1,384 –6.0

Financial performance EURm

Revenue 114.3 –15.3

EBITDA 37.5 –36.8

EBIT 9.6 –35.0



Diverging development of sales volumes

Lower sales volumes of electricity

Temperature-related rise in sales volumes

of natural gas and heat

Higher EBITDA and EBIT

Year-on-year decrease of revenue

Lower prices for renewable energy

On-going pressure on electricity prices

Reduced volumes

Lower operating expenses

Drop in electricity purchasing volumes

Decline in procurement costs

1) Average, household sector (source: EVN)

End customer price adjustment1)

Electricity 1.1.2012 –1.7%

Sales volumes to end customers GWh 2012/13

+/– in %

Electricity 7,188 –3.2

Natural Gas 6,333 2.7

Heat 1,857 8.6


Revenue 1,082.4 –4.1

EBITDA 53.1 53.7

EBIT 37.1 –



Different development of

distribution volumes

Electricity: temperature-related increase

Natural gas: decline

Reduction in industrial demand

Lower use of gas-fired power plants

Increase in EBITDA and EBIT

Decrease in transmission network costs

Increase in work in progress due to lower

number of customer projects that had not

been invoiced on balance sheet date

1) Average, according to the regulator in Austria (E-Control)

2) Including network sales to EVN‘s power stations

Tariff structures1)

Electricity 1.1.2013 –0.4%

Natural gas 1.1.2013 –2.5%

Network distribution volumes GWh 2012/13

+/– in %

Electricity 7,885 1.3

Natural gas2) 15,232 –1.3


Revenue 505.7 0.6

EBITDA 221.1 9.3

EBIT 120.4 17.8



1) Average, household sector, according to the regulators in Bulgaria (SEWRC) and Macedonia (ERC)

2) In Bulgaria and Macedonia energy sales volumes fairly equal present network distribution volumes

Rise in electricity generation volumes Takeover of operations at additional hydropower plants in Macedonia Full-year operations at co-generation plant in Plovdiv, Bulgaria

Temperature-related decrease in sales volumes EBITDA and EBIT increase

Higher revenue Price increases in Macedonia in 2012

Full-year operations at co-generation plant

Increase in procurement costs due to additional costs related to renewables Higher other operating expenses Higher depreciation

End customer price adjustments1)

Bulgaria electricity

1.7.2012 13.6%

5.3.2013 –7.3%

1.8.2013 –4.2%

heat 1.7.2012 –20.6%

1.1.2013 –5.9%

Macedonia electricity 1.1.2012 7.8%

1.8.2012 9.8%

1.7.2013 –3.0%

Key energy business indicators GWh 2012/13 +/–

in %

Electricity generation volumes 427 66.3

Network distribution volumes2) 13,031 –5.8

Heat sales volumes to end customers 205 –14.9


Revenue 1,007.7 4.0

EBITDA 117.1 7.6

EBIT 51.2 13.0


Environmental Services

EBITDA and EBIT decline Lower revenue Higher project completions in prior year

Decrease in operating expenses in line with the development of the revenue

Financial results Interest results slightly improved

Business development

Nine international projects currently in process Moscow: discussions about subsequent amendments of the structure of the projects Lower Austria: further activities to safeguard and improve drinking water supplies

EURm 2012/13 +/–

in % Financial performance

Revenue 248.4 –26.0

EBITDA 38.7 –51.1

EBIT 9.8 –81.2

Financial results 12.1 3.3

Profit before income tax 21.8 –65.6


Cash flow

Increase of gross cash flow Non-cash effects from at equity investees

Higher net cash flow from operating activities

Lower year-on-year growth in working capital

Drop of net cash flow from investing activities

Acquisition of short-term securities

Increase in net cash flow from

financing activities Prior year affected by the purchase of additional stakes in EVN Bulgaria Dividend payment to EVN’s shareholders Current share buyback programme

EURm 2012/13 +/–

in %

Gross CF 553.6 15.3

Net CF from operating activities 561.7 21.8

Net CF from investing activities –380.5 –14.0

Net CF from financing activities –90.5 14.3

Net change in cash and cash equivalents

90.7 –


Outlook 2013/14

Industry outlook: Challenging environment

EVN’s strategy: Focus on efficiency and core markets Integrated business model, protection of security of supply

Broad, diversified and stable customer base Group net profit above 2012/13, but below recent years


Agenda

EVN at a glance



Outlook

Appendix



− RAG



− Contact details

75

Contact details

Investor information on the web

www.evn.at

www.investor.evn.at

www.responsibility.evn.at

E-mail: [email protected]

EVN AG

Headquarters

EVN Platz

2344 Maria Enzersdorf

Stefan Szyszkowitz

CFO

Phone: +43 2236 200-12132

Fax: +43 2236 200-82132


Gerald Reidinger

Head of Finance and Investor Relations

Phone: +43 2236 200-12698

Fax: +43 2236 200-82698


76

Disclaimer

Certain statements made in this presentation may constitute

“Forward-Looking Statements” within the meaning of the U.S. federal

securities law. Forward-looking 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.

77

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