VERBUND achieves new record results in quarter 1/2007
24.04.2007Wien
VERBUND continued the positive business development of the previous year in quarter 1/2007. Despite the somewhat more difficult environment, results, sales and ratios saw a further improvement, thus confirming the group's good positioning.
Sales revenue increased by 3.7 % to 812.2 million Euro, the operating result rose by 12.1 % to 239.7 million Euro and the group result was up 36.1 % at 188.2 million Euro. Moreover, there was an improvement in tax relevant company ratios. The EBIT margin increased from 27.3 % to 29.5 %, the EBITDA margin improved from 32.8 % to 35.0 %, and the net gearing dropped from 91.5 % to 71.1 %. The operating cash flow, on the other hand, as a result of aperiodic payments in connection with the energy derivatives used, declined by 44.1 million Euro to 197.8 million Euro.
Higher contract prices despite weak spot market prices
Following the long steady growth of the European wholesale prices for electricity, this trend was markedly interrupted at the end of 2006, particularly with regard to spot market prices, a situation which continued in quarter 1/2007. Thanks to its consistent hedging strategy – approximately 60 % of the electricity that is generated was already sold in 2006 on a year-ahead basis for 2007 – VERBUND was able to further raise its average sales prices in spite of the wholesale price correction.
Significantly improved water supply as compared to the previous year
With a generation coefficient of 1.01, the average water supply from rivers needed for hydropower generation was one percent higher in quarter 1/2007 than the long-time average of the past 30 years and significantly above the value recorded in 2006 (0.83). Together with the increased utilization of annual storage power plants, this led to a growth in electricity generation from hydropower of 23.8 % to 5,561 GWh. Generation from thermal power plants, on the other hand, declined by 36.5 % on account of the low spot market prices. The total generation of the group was 6.7 % up on the value recorded the previous year at 6,690 GWh.
International business activities further expanded
In quarter 1/2007, VERBUND was able to further expand its international business activities and enter into an exclusive joint venture with Sabanci, Turkey's leading financial and industrial holding. The jointly-owned generation company "EnerjiSA", in which VERBUND will be holding a share of almost 50 %, aims to have an installed output of 5,000 MW by 2015. The company also intends to purchase electricity distribution grids within the course of the privatization process. In addition, the company will also get involved in the end customer segment so as to cover the entire value chain. Together, the partners aim to achieve a share of at least 10 % in the Turkish electricity market.
Positive outlook
In spite of the difficult market environment, the outlook for the full year 2007 remains positive. It is our goal to increase the operating result by 10 % compared with 2006. In addition, VERBUND intends to further increase the dividend for fiscal 2007.
Higher contract prices despite weak spot market prices
Following the long steady growth of the European wholesale prices for electricity, this trend was markedly interrupted at the end of 2006, particularly with regard to spot market prices, a situation which continued in quarter 1/2007. Thanks to its consistent hedging strategy – approximately 60 % of the electricity that is generated was already sold in 2006 on a year-ahead basis for 2007 – VERBUND was able to further raise its average sales prices in spite of the wholesale price correction.
Significantly improved water supply as compared to the previous year
With a generation coefficient of 1.01, the average water supply from rivers needed for hydropower generation was one percent higher in quarter 1/2007 than the long-time average of the past 30 years and significantly above the value recorded in 2006 (0.83). Together with the increased utilization of annual storage power plants, this led to a growth in electricity generation from hydropower of 23.8 % to 5,561 GWh. Generation from thermal power plants, on the other hand, declined by 36.5 % on account of the low spot market prices. The total generation of the group was 6.7 % up on the value recorded the previous year at 6,690 GWh.
International business activities further expanded
In quarter 1/2007, VERBUND was able to further expand its international business activities and enter into an exclusive joint venture with Sabanci, Turkey's leading financial and industrial holding. The jointly-owned generation company "EnerjiSA", in which VERBUND will be holding a share of almost 50 %, aims to have an installed output of 5,000 MW by 2015. The company also intends to purchase electricity distribution grids within the course of the privatization process. In addition, the company will also get involved in the end customer segment so as to cover the entire value chain. Together, the partners aim to achieve a share of at least 10 % in the Turkish electricity market.
Positive outlook
In spite of the difficult market environment, the outlook for the full year 2007 remains positive. It is our goal to increase the operating result by 10 % compared with 2006. In addition, VERBUND intends to further increase the dividend for fiscal 2007.