Corporate news: VERBUND results for quarters 1–3/2018

VERBUND’s business performance in quarters 1–3/2018 was very satisfactory. Earnings increased despite the historically low water supply from Austrian rivers, our return KPIs improved further and the Group continued to reduce its debt level. VERBUND shares saw their best performance by far on the ATX as well as among all European utilities since the beginning of the year. After the recent ratings upgrades, VERBUND’s credit rating is again one of the best in the sector.

However, business performance suffered in quarter 3/2018 due to historically low water supply. The months of July, August and September were among the driest on record. The hydro coefficient of 0.74 meant that the water supply was 26% below the long-term average. Due to the above-average hydro situation in the first half-year, the hydro coefficient for quarters 1–3/2018 was 0.96, or just 4% below the long-term average. The higher contribution from the Grid segment and the good results achieved through the programmes implemented in recent years to reduce costs and increase efficiency had a positive impact on earnings performance. Revenue from flexibility products developed better than expected but witnessed a decline year-on-year, given that financial year 2017 was heavily impacted by positive effects.

EBITDA was up 2.3%, rising from €663.5m to €678.4m. The reported Group result rose by 4.9% with an increase from €269.5m to €282.8m. The Group result after adjustment for non-recurring effects increased by 10.1%, from €252.1m to €277.6m. Operating cash flow rose by 12.0% to €542.1m, and free cash flow before dividends was up 21.5% to €389.0m. Net debt has therefore decreased by 7.4% since 31 December 2017 to €2,663.2m.

Outlook for 2018