EQS-News: EVN AG: Business development in the first three quarters of 2022/23

EQS-News: EVN AG / Key word(s): Interim Report/Quarter Results
   EVN AG: Business development in the first three quarters of 2022/23

   24.08.2023 / 07:30 CET/CEST
   The issuer is solely responsible for the content of this announcement.

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   Highlights

     • EBITDA +4.2%; positive development in the Generation and South East
       Europe Segments, but substantial loss for the period recorded by the
       energy supply company EVN KG
     • Group net result significantly influenced by higher dividend from
       Verbund AG
     • Increase in renewable generation to 76.0%; investments at record level
     • Commissioning of photovoltaic plants in Trumau and Theiss with total
       capacity of roughly 13 MWp
     • Additional wind parks and photovoltaic plants with a combined capacity
       of over 116 MW in preparation or under construction
     • Order received for the construction of a sewage sludge utilisation
       plant in Munich (contract value: approximately EUR 255m)
     • Arrangement of a EUR 110m “green loan“ by the European Investment Bank

    

   Energy sector environment

   The heating degree total – which defines the temperature-related demand
   for energy – reflected the long-term average in Austria during the first
   three quarters of 2022/23. In Bulgaria and North Macedonia, it was clearly
   below the long-term average and previous year in both countries as the
   result of milder temperatures. Primary energy prices continued to trend
   downwards. The market prices for base load and peak load electricity
   followed this development but remain at a high level. The spot market
   prices for base load and peak load electricity were lower than the
   previous year at an average of EUR 150.2 per MWh and EUR 176.0 MWh
   (previous year: EUR 207.2 per MWh and EUR 239.9 per MWh). The price for
   CO[2] emission certificates represented an exception with an increase to
   EUR 83.7 per tonne (pervious year: EUR 76.4 per tonne).

   EBITDA and EBIT and group net result above previous year

   Revenue recorded by the EVN Group declined by 1.3% to EUR 2,904.1m in the
   first three quarters of 2022/23. The underlying factors included a
   decrease in revenue from South East Europe due to lower network and energy
   sales volumes as well as market price declines which followed the market
   distortions and sharp rise in the previous year. The international project
   business also reported a decrease in revenue. In contrast, revenue was
   increased by price effects for renewable electricity generation, valuation
   effects from hedges, higher sales prices at EVN Wärme and an increase in
   network tariffs.

   In line with the development of revenue in South East Europe, the cost of
   energy purchases from third parties and primary energy expenses declined
   by 21.3% year-on-year to EUR 1,340.0m. Contrasting factors included, above
   all, higher costs for network losses and upstream network costs for Netz
   Niederösterreich as well as higher energy procurement costs for EVN Wärme.

   The cost of materials and services was 4.5% lower at EUR 457.0m consistent
   with the development of revenue in the international project business and
   offset inflation-related increases in the other Group companies. Personnel
   expenses were 8.1% higher year-on-year at EUR 298.7m due to adjustments
   required by collective bargaining agreements. The number of employees
   increased to 7,229 (previous year: 7,142 employees).

   Other operating expenses rose by 45.3% to EUR 138.2m. This position
   includes the EUR 21.5m energy crisis levy on the surplus proceeds earned
   from electricity generation which has been payable in Austria since
   December 2022.

   The share of results from equity accounted investees with operational
   nature equalled EUR –157.7m in the first three quarters of 2022/23
   (previous year: EUR 100.7m). This decline – as already reported in the
   first quarter and projected for the remainder of this year – is
   attributable to the energy supply company EVN KG, where business
   development in the reporting period has been massively influenced by
   multiple factors: In addition to higher procurement costs for energy which
   can only be passed on to customers with a delay, earnings were negatively
   influenced by the lower valuation of hedges as of 30 June 2023 and
   additions to the provisions for impending losses from contractual delivery
   obligations. A contrasting factor was the improvement in the earnings
   contributions from RAG and the Verbund Innkraftwerke power plants.

   Based on these developments, EBITDA recorded by the EVN Group rose by 4.2%
   year-on-year to EUR 602.1m in the first three quarters of 2022/23.

   Investments led to an increase of 3.3% in scheduled depreciation and
   amortisation to EUR 244.5m. A comparison of this position with the
   previous year is also influenced by the absence of EUR 51.2m in effects
   from impairment testing in 2021/22: Impairment losses in the international
   project business were contrasted by a revaluation of EUR 6.4m to the
   Kavarna wind park in Bulgaria. The first three quarters of 2022/23 also
   included a revaluation of EUR 1.6m at EVN Wasser as of 30 June 2023. In
   total, EBIT rose by 23.8% to EUR 359.2m.

   Financial results totalled EUR 132.5m in the first three quarters of
   2022/23 (previous year: EUR 4.8m) and were influenced, above all, by an
   increase in the dividend from Verbund AG for the 2022 financial year
   (2022: EUR 3.60 per share; previous year: EUR 1.05 per share). The
   earnings contribution from the investment in Verbund AG equalled EUR
   158.0m for the reporting period. Financial results were also improved by
   foreign exchange valuation effects and by the better performance of the
   R138 fund and EVN’s cash funds – despite an increase in interest expense.

   The result before income tax equalled EUR 491.7m in the first three
   quarters of 2022/23 and was 66.7% higher than the previous year. After the
   deduction of EUR 37.6m in income tax expense (previous year: EUR 47.2m)
   and the earnings attributable to non-controlling interests, Group net
   result for the period equalled EUR 419.1m. That represents a year-on-year
   increase of 83.5%, which was influenced primarily by the high dividend
   payment of EUR 158.0m from Verbund AG.

   Solid balance sheet structure

   EVN can continue to rely on a solid and stable capital structure that
   forms a sound basis for the realisation of extensive investments in the
   network infrastructure, renewable generation and drinking water supplies
   over the coming years. Net debt equalled EUR 1,470.2m as of 30 June 2023
   and was influenced, above all, by the steady high level of investment,
   ongoing liquidity compensation for the energy supply company EVN KG to
   cover working capital requirements, and the dividend from Verbund AG. A
   EUR 110m loan was arranged by the European Investment Bank in June 2023 to
   finance wind power projects.

   Energy. Water. Life. – Developments in the energy and environmental
   services business

   Energy business

   EVN generated 2,330 GWh of electricity in the first three quarters of
   2022/23, which represents a 15.7% year-on-year decline. Thereof, 1,771 GWh
   were attributable to renewable generation (previous year: 1,774 GWh). The
   increase in electricity generation from hydropower was unable to offset
   the decrease in renewable generation caused by clearly below-average wind
   flows. The reduction in electricity generation from the thermal power
   plants resulted primarily from the lower use of the Theiss power plant to
   support network stabilisation. The share of renewable generation rose to
   76.0% in the reporting period (previous year: 64.2%).

   In line with the Strategy 2030 and the related expansion goals for
   renewable generation, the newly built wind park in Japons (repowering:
   12,6 MW) and three large-scale photovoltaic plants in Grafenwörth, Trumau
   and Theiss (total capacity: approximately 25 MWp) were commissioned during
   the first three quarters of 2022/23. Five further wind parks and a
   photovoltaic project with a total output of over 116 MW are currently
   under construction or in preparation.

   Environmental and water business

   Investments in drinking water supplies continue to focus on the planning
   and construction of transport and connecting pipelines to further improve
   and protect supply security. Construction on the second section of the 60
   km Waldviertel transport pipeline from Krems to Zwettl started during the
   reporting period. EVN’s natural filter plant in Bisamberg was commissioned
   in March 2023 and now supplies roughly 50,000 customers in the region
   north of Vienna with naturally softened drinking water. In addition, the
   groundbreaking ceremony for a natural filter plant in Obersulz took place
   in recent months.

   In the international project business, WTE Wassertechnik received a
   contract for the construction of a sewage sludge utilisation plant in
   Munich, Germany (contract value: approximately EUR 255m). This large-scale
   plant will be responsible for the thermal utilisation of the entire sewage
   sludge from wastewater treatment in Munich and in the 22 surrounding
   communities.

   As of 30 June 2023, WTE Wassertechnik was working on the planning and
   construction of 15 projects for wastewater treatment, drinking water
   treatment and thermal sludge utilisation in Germany, Poland, Lithuania,
   Romania, North Macedonia, Bahrain and Kuwait.

   Confirmation of the outlook for the 2022/23 financial year

   The contribution of the operating activities of EVN to Group net result in
   the financial year 2022/23 will amount to approximately EUR 250m in
   2022/23. An additional earnings contribution of EUR 158m to Group net
   result for the current financial year has come from the investment in
   Verbund AG.

    

   The Letter to Shareholders on the first three quarters of 2022/23 is
   available under www.investor.evn.at.

    

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   24.08.2023 CET/CEST This Corporate News was distributed by EQS Group AG.
   www.eqs.com

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   Language:    English
   Company:     EVN AG
                EVN Platz
                2344 Maria Enzersdorf
                Austria
   Phone:       +43-2236-200-12294
   E-mail:      [email protected]
   Internet:    www.evn.at
   ISIN:        AT0000741053
   WKN:         074105
   Indices:     ATX
   Listed:      Vienna Stock Exchange (Official Market)
   EQS News ID: 1710143


    
   End of News EQS News Service


   1710143  24.08.2023 CET/CEST

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