Thursday , June 30 2022

Composite prognosis reduced after dry summer – targets over 2017


(APA) – Due to the low water supply in the third quarter, Verbund will reduce its annual targets by 2018, which are still above the 2017 outputs. Despite the historically low water supply in the third quarter, the Group's operating profit was higher than in September in the same period of the previous year.

In the third quarter, the water supply was 0.74 26 percent below the long-term average. Verbund, July, August and September were the strongest months since the recording began. However, due to an above-average supply of water by June, the hydroelectric power plant's factor was only 4% below the long-term average for nine months at 0.96 and 2 percentage points above the previous year's level. This year's results have contributed a higher contribution to revenue from the network segment as well as the success of cost reduction programs and efficiency gains in recent years. On the other hand, revenues from flexible products have fallen, after 2017 they have had positive effects.

Verbund's own production dropped 1.8 percent to 24,347 gigawatthodines (GWh) in nine months. The hydro power plant increased by 2.0% to 22.893 GWh, but decreased by 14.2% to 584 GWh in wind power and 47.8% to 870 GWh in thermal energy. The combined cycle Mellach gas plant produced 717 GWh less due to lower congestion control and 80 GWh less in the Mellach coal power plant.

The combined Mellach gas and gas power plant is currently exclusively used to ensure supply safety during congestion management. The new contract (which also includes Mellach's motorway heating) was recently established under the auspices of E-Control for 1.10.2018 to 30.9.2021 with the Austrian Energy Network (APG). This year there was no devaluation of Verbund's balance sheets in the first three quarters, as it reached EUR 15.0 million in the same period in 2017 (EUR 10.5 million mainly due to the depreciation of the Mellach plant). It has so far reached a EUR 6,2 million rebate, particularly in the case of decommissioned power plants in Dürnrohr and Korneuburg; the abolition of value added of EUR 38.2 million until 30.9.2017 was entirely added to the then revaluation of Gell Mellach.

Total external sales and distribution sources (by 5.5 percent to 19,521 GWh) and external consumption losses and balancing gas, Verbund's total power supply increased by 0.5 percent to 48,065 GWh in September. Group electricity sales also rose 0.5 percent to 44,365 GWh; Of this, 20,768 GWh (-2.5%) were assigned to resellers, 14,174 GWh (+ 1.6%) to retailers and 9,424 GWh (+ 6.0%) to end customers. In the segment of private customers, Verbund, according to the quarterly report, calculated around 464,000 customers for electricity and gas at the end of September.

In the sale of electricity, the decline in domestic trade was more than offset by a significant increase in sales to foreign customers. In Austria, electricity sales decreased by 16.6 percent to 20,437 GWh, but in Germany it increased by 19.4 percent to 20,644 GWh and France by 21.6 percent to 2,310 GWh.

Electricity futures prices (Frontyear-Base 2018, traded in 2017) averaged € 32.4 per megawatt-hour (MWh), up 21.8% in the same period last year. Spot market prices (base) increased by 20.7% in the reporting period to 41.7 EUR / MWh.

With a 3.7 percent decline in sales to € 2.081 billion by September, electricity revenues dropped by € 165.9 million to € 1.614 billion. The main reason for the reduction of electricity revenues was the first time IFRS 15 (net of revenue) in respect of the charged network charges / allocations offset by reference costs. Revenue from the grid increased by € 74.7 million to € 371.7 million, mainly due to higher revenues from national grids due to higher tariffs. Other earnings increased by EUR 10.3 million to EUR 95.2 million, mainly due to higher revenues from the sale of green electricity certificates and district heating supplies. Expenditure on electricity, grid, gas and certificates decreased by EUR 110.3 million to EUR 984.9 million.

Verbund increased EBITDA by 2.3 percent to EUR 678.4 million and improved its reported consolidated profit by 4.9 percent to EUR 282.8 million, the company's 51 percent stake to be linked to the planned reform the State holding ÖBIB as ÖBAG. Verbund expects to expect only EUR 870 million EBITDA throughout the year – at the end of July, the half-yearly report still expected 950 million euros. The consolidated result may be recorded in 2018 at approximately 340 instead of 370 million, based on average energy production from hydro and wind power plants. EBITDA reached EUR 922 million in 2017 and the reported consolidated income amounted to EUR 301 million.

Adjusted for one-off effects, consolidated earnings per year, of which 40 to 45 percent will be distributed as dividends, is now expected to reach approximately € 335 million for the full year of 2018, most recently about € 365 million. Until September, adjusted net income increased by 10.1 percent to EUR 277.6 million. For the year 2017, it amounted to € 354.5 million and the payout ratio was 41.2%.

Operating cash flow increased by 12.0 percent to EUR 542.1 million in September, while free cash flow before dividends increased by 21.5 percent to EUR 389.0 million, according to Verbund. Net debt declined by 7.4 percent from the end of 2017 to EUR 2,663 billion. Net debt declined year on year to 46.3 (52.7%). Improving cash flow and debt reduction would increase financial flexibility, the company points out.

The number of employees in the three quarters was on average 2,739, which was an average of 3.2 percent lower than a year earlier.

Verbund's share was the most powerful in ATX this year with an increase of 110 percent by the end of September – and also the best performance of all European instruments. Currently titles occupy the ATX number 1 at approximately 79 percent over the beginning of the year. On Wednesday morning, they lost some furious (up to 7 percent), last traded at 36.50 to 1.78 percent less than the previous day – ATX was at the same rate of 0.94 percent.

~ ISIN AT0000746409 WEB ~ APA176 2018-11-07 / 10: 03

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