Slide 1: EVN Company presentation
EVN Company presentation June 1, 2011
Slide 2: Agenda
Agenda 1. Investment highlights 2. Business segments 3. Financial performance 4. Projects 1 Investment highlights 2 3 4 2
Slide 3: EVN at a glance
EVN at a glance Profile Key metrics (2009/10) > Leading integrated Energy and Environmental Services Generation company serving customers in Lower Austria, South East Europe and Central and Eastern Europe > Electricity generation: 3,653 GWh > Active in 20 countries Networks > Key business areas incl
Slide 4: EVN at a glance – active in 20 countries
EVN at a glance – active in 20 countries > Strong position in the home market encompassing the whole value chain > A leading Central and Eastern Europe player in water, wastewater and waste incineration > Long term experience with a proven track record of reference projects 1 Investment highlights 2
Slide 5: An attractive investment opportunity
An attractive investment opportunity More than 60% of revenues and more than 80% of EBITDA from stable core Austrian 1 business 2 Growing portfolio of high quality generation assets 3 Significant upside potential from SEE market development 4 Positioned to capture attractive returns in international
Slide 6: Stable core Austrian business
1 Stable core Austrian business Revenue contribution (EURm) EBITDA contribution (EURm) (% of (% of 63% 62% 62% 77% 80% 84% total) total) 2,727 2,752 416 2,397 373 363 67 1,048 1,051 75 82 876 349 298 1,679 1,701 280 1,521 07/08 08/09 09/10 07/08 08/09 09/10 Domestic activities International activiti
Slide 7: Growing portfolio of high quality generation assets
2 Growing portfolio of high quality generation assets Capacity development (Pro-rata installed capacity , MW) 2,635 192 53 25 45 123 410 128 15 1,787 1,701 2,541 1,533 1,558 1,573 1,410 1,000 Status quo Walsum Wind park 1 Ashta Gorna Arda Devoll Others 2 2009/10 Selected current generation projects
Slide 8: Significant upside from SEE investments
3 Significant upside from SEE investments Illustrative electricity sales Electricity prices for Improvement of grid volumes per customer (%)1 household (EUR cent/kWh) efficiency (%) 120 25 Upside potential 100 100 20 80 80 15 60 54 24% 22% 21% 10 16% 17% 16% 40 15% 14% 13% 13% 12% 20 5 0 0 Macedonia
Slide 9: Attractive returns in Environmental Services
4 Attractive returns in Environmental Services > Successful participation in 94 projects in 16 countries since 1983 (HY. 1 2010/11) > Strong demand for infrastructure projects set to continue > Sales backlog of EUR 1.3bn with attractive return potential from international projects > Underpinned by s
Slide 10: Internal hedge from strategic investments
5 Internal hedge from strategic investments 12.63% 50.03% 73.6% 49% 49% > #1 electricity producer in > #2 oil and gas producer in Austria > #1 green energy producer in Austria with 8.6 GW installed > One of the largest gas storage Austria with ~270 MW installed capacity operators in Central Europe w
Slide 11: A clear strategy to develop our integrated business model
A clear strategy to develop our integrated business model > Expand generation capacity - Target a coverage ratio of 40%–60% - Increase the share of renewable generation to 50% in the long-term - High quality projects in SEE > Maintain market leadership in Austrian supply business > Enhance efficienc
Slide 12: Agenda
Agenda 1. Investment highlights 2. Business segments 3. Financial performance 4. Projects 1 2 Business segments 3 4 12
Slide 13: Generation
Generation Volume generated > 1,787 MW generation portfolio1 4,000 3,768 > Competitive advantage from flexible plant 3,500 3,197 3,303 operations 1,202 3,000 2,500 1,166 1,118 > Group supply coverage ratio currently ~20% GWh 2,000 - 50%–65% in Austria 1,500 2,566 1,000 2,031 2,185 > Significant proj
Slide 14: Generation
Generation Electricity generation 2009/10 Change > Increase in energy generation volumes volumes (GWh) in % - Increase of generation from EVN‘s Total 3,303 3.3 thermal energy sources thereof thermal power 2,185 7.6 - Decrease of generation from renewable thereof renewable energy 1,118 –4.1 energy so
Slide 15: Generation – the way forward
Generation – the way forward Coverage ratio > Increase coverage ratio long term Market entrance to 40%–60% on Group level 70.0% Bulgaria 60.0% - Hold coverage ratio in CWE Market entrance 50.0% 40.0% Macedonia - Increase coverage ratio in SEE 68.8% 30.0% 56.1% 40% - 20.0% 39.5% 60% 29.2% 10.0% 19.1%
Slide 16: Network Infrastructure Austria
Network Infrastructure Austria Distribution volumes > Operation of regional electricity and gas 30,000 networks (EVN Netz) as well as cable TV 26,294 26,101 25,000 24,476 and telecommunications networks 7,476 7,576 20,000 7,317 GWh 15,000 > 807,000 electricity and 289,000 gas 10,000 18,818 17,159 18
Slide 17: Network Infrastructure Austria
Network Infrastructure Austria Network distribution 2009/10 Change > Higher network distribution volumes due volumes (GWh) in % to cold weather Electricity 7,576 3.5 - Increase in electricity distribution volumes Gas1) 18,525 8.0 - Strong increase in gas distribution volumes > Adjustment of network
Slide 18: Network Infrastructure Austria – the way forward
EVN is active Network in Bulgaria Infrastructure since–January Austria the way2005 forward > Expect RAB to grow in line with economic growth of respective region > Investment projects in trans-regional natural gas pipeline projects RAB > Underground cable lines, replacement of PVC pipelines and pote
Slide 19: Energy Trade and Supply
Energy Trade and Supply Supply volume to end customers > Sourcing, trading and selling electricity, gas and heat to end customers 16,000 15,324 14,413 14,000 1,176 13,956 1,569 > Approximately 1.1 m customers in 1,316 Lower Austria 12,000 10,000 6,738 > Below market average net switching 6,759 6,102
Slide 20: Energy Trade and Supply
Energy Trade and Supply > Increase in sales volume to end Sales volumes to end 2009/10 Change customers customers (GWh) in % - Electricity: higher sales volumes in Lower Electricity 7,017 7.3 Austria and in the supply market of Natural gas 6,738 10.4 EnergieAllianz Heat 1,569 19.2 - Gas: Sales volum
Slide 21: Energy Trade and Supply – the way forward
EVN is Trade Energy active and in Bulgaria Supply since January – the way 2005 forward > Current market share ~77% (electricity), ~78% (gas including EconGas) Maintain market > Retain the current customer base by offering innovative energy solutions and position in Lower individually tailored supply
Slide 22: Energy Supply South East Europe
Energy Supply South East Europe Bulgaria Macedonia > Active in Bulgarian and Macedonian Market entry in 2005 Market entry in 2006 electricity distribution and supply business Skopje > Servicing 2.5 m customers Plovdiv > Electricity generation volume of 122 GWh Distribution volume > Heating generatio
Slide 23: Energy Supply South East Europe
Energy Supply South East Europe Network distribution 2009/10 Change > Diverting sales volumes development volumes (GWh) in % - Bulgaria: sales volume increased by Electricity 13,189 0.6 1.5% due to reduction in network losses thereof Bulgaria 7,977 1.5 - Macedonia: slight decrease in sales thereof M
Slide 24: Energy Supply South East Europe - the way forward
Energy Supply South East Europe - the way forward Investments in modernization (EUR m) 153 > Benefit from past investments 105 101 83 16 31 > Continue efficiency efforts 04/05 05/06 06/07 07/08 08/09 09/10 - Reduction of grid losses Improvement of grid efficiency (%) - Improvement of customer servic
Slide 25: Environmental Services
Environmental Services > #1 water supplier in Lower Austria > Takeovers of local water supply Water supply networks and outsourcing contracts Lower Austria > EUR 25.9m revenues 2009/10 Waste > Largest waste to energy plant in > Increased capacity since beginning incineration Austria of 2010 Lower Au
Slide 26: Environmental Services
Environmental Services > Significant increase of revenue 2009/10 Change - Waste incineration plant, Dürnrohr – expansion by a third line EUR m in % - International project business: Revenue 285.4 15.4 • Waste incineration plant, Moscow EBIT 28.0 1.7 • Wastewater treatment plant in Budva, Profit befo
Slide 27: Environmental Services – the way forward
Environmental Services – the way forward > Moderate growth at high quality (additional services, acquisition Water supply of local water supply networks) Lower Austria > Measures for securing and > Austrian water and waste business offers solid and improving quality highly visible revenue and earnin
Slide 28: Agenda
Agenda 1. Investment highlights 2. Business segments 3. Financial performance 4. Projects 1 2 3 Financial performance 4 28
Slide 29: Business highlights 2009/10
Business highlights 2009/10 > Start of operation of EVN‘s longest district heating transmission pipeline to St. Pölten > Start of operation of EVN‘s most powerful photovoltaic plant in Blatets, Bulgaria > Further concession agreement in Croatia for the construction of the natural gas distribution an
Slide 30: Success factors in 2009/10
Success factors in 2009/10 > Strong market position in Austria with an integrated product portfolio > Stable end customer base in Lower Austria > Big share in residential customers, diversified industrial customer base in terms of customer size and business sectors in the home market > More than 60%
Slide 31: Financial highlights 2009/10
Financial highlights 2009/10 2009/10 Change > Higher sales volumes due to cold EUR m in % weather Revenue 2,752.1 0.9 > Revenue increase in environmental service segment EBITDA 416.6 11.6 - Expansion of Dürnrohr‘s waste EBIT 187.3 6.9 incineration plant by the third line - Increase in internation pr
Slide 32: The vast majority of revenues and EBITDA are generated in domestic and regulated businesses
The vast majority of revenues and EBITDA are generated in the domestic and regulated businesses Revenue breakdown by business unit 2009/101 Geographic revenue breakdown2 Environmental Generation Services Network 3,000 4% 2,727.0 2,752.1 10% Infrastructure 2,397.0 2,500 Austria 38% 38% 17% 2,000 37%
Slide 33: Strong expansion of revenue across segments
Strong expansion of revenue across segments Network Infrastructure Energy Trade Energy Supply Environmental Generation Austria and Supply South East Europe Services 1,400 1,190 1,187 1,200 999 1,000 879 862 800 754 EURm 600 475 468 489 400 285 247 196 200 125 146 119 0 2007/08 2008/09 2009/10 2007/0
Slide 34: Solid EBITDA development
Solid EBITDA development Network Infrastructure Energy Trade Energy Supply Environmental Generation Austria and Supply South East Europe Services 220 57.6% 60.0% 200 191 55.5% 180 50.0% 159 160 147 44.3% 40.0% 140 39.1% Margin (%) EURm 120 34.0% 30.0% 100 31.0% 84 76 20.2% 80 69 69 65 17.0% 18.3% 20
Slide 35: Substantial contribution to net profit from strategic investments
Substantial contribution to net profit from strategic investments Income from investments 150 137 > Strategic investments provide a significant 116 contribution to EVN’s profit 130 21 110 36 94 25 > RAG and VERBUND are the two main 90 contributors 23 EURm 70 50 > Income from VERBUND increased by 42
Slide 36: Cash Flow
Cash Flow 2009/10 Change > Increased Gross cash flow EUR m in % - Higher profit before income tax Gross cash flow 467.7 5.1 - Lower non-cash items Net cash flow from > Significant improvement of Net cash flow operating activities 499.3 48.9 from operating activities Net cash flow from investing - Sl
Slide 37: Investments
Investments (EURm) > Investment level 5.2% below previous year 450 415.7 394.0 > Key investments per business segments 400 52.4 - Generation 68.6 350 • Optimisation of Dürnrohr power station 300 104.8 • Construction of wind park in Kavarna, Bulgarien 100.7 250 - Network Infrastructure Austria 32.5 2
Slide 38: Balance sheet
Balance sheet 2009/10 Change > Slight increase of total assets 1) EUR m in % > Slight decrease in equity and equity ratio Total assets 6,731.2 0.5 - Lower market value of the shareholding in Equity 3,025.3 –3.3 VERBUND AG Equity ratio (in %) 44.9 –1.8p > Slight increase in net debt and gearing Net d
Slide 39: Solid capital structure and rating supports stable dividend policy
Solid capital structure and rating supports stable dividend policy Net financial debt and gearing > Increase in net debt and gearing ratio due to ongoing 1,378.2 1,458.2 100% investments in Austria and South Eastern Europe 1,400 1,131.3 > Net debt can be easily covered by financial assets 1,200 80%
Slide 40: Outlook 2010/11
Outlook 2010/11 > Trends - Stable end customers business development - Lower spreads between primary energy prices and electricity prices - Stable order book in Environmental Services segment > EVN‘s expectations - Operating results may remain stable - Group net profit below the prior-year level 1 2
Slide 41: Agenda
Agenda 1. Investment highlights 2. Business segments 3. Financial performance 4. Projects 1 2 3 4 Projects 41
Slide 42: Generation – Photovoltaic power plant in Blatets and Trastikovo, Bulgaria
Generation – Photovoltaic power plant in Blatets and Trastikovo, Bulgaria Blatets: > Start of operation: May 2010 > Capacity: 0.8 MWpeak > EVN‘s most efficient photovoltaic power plant > Reduction of CO2 emissions: 280 tons Trastikovo: > Start of operation: July/August 2011 > Capacity: 2.0 MWpeak Tr
Slide 43: Generation – Hydropower plant projects in Albania
Generation – Hydropower plant projects in Albania > Project Ashta on the Drin River - Start of construction: March 2010 - Start of operations: 2012 - Capacity: 50 MW - Generation: approx. 240 GWh p.a. - Concession period: 35 years - 50:50% Joint Venture with VERBUND - Supply of 100,000 households >
Slide 44: Renewable energy projects in Lower Austria
Renewable energy projects in Lower Austria > Revitalisation of a small hydropower plant, Schütt/Ybbs - Subsitution of a 107-year old hydropower plant - Start of operations: 2011 - Capacity: 1.98 MW - Supply of 2,700 households > Windparks, Markgrafneusiedl and Tattendorf - Total capacity: 16 MW - To
Slide 45: Network Infrastructure Austria – gas transport pipelines Süd- and Westschiene
Network Infrastructure Austria – gas transport pipelines “ Süd- and Westschiene“ > “Südschiene“: - Ground-breaking ceremony: September 2009 - Completion: September 2011 - Investments: EUR 114m - Length: 120 km > “Westschiene”: - Start of construction: FY 2010/11 - Completion: End of 2013 - Investmen
Slide 46: Energy Trade and Supply – District heating pipeline Dürnrohr/St. Pölten
Energy Trade and Supply – District heating pipeline Dürnrohr/St. Pölten > Completion: October 2009 > Investments: EUR 35m > Capacity: 200 GWh p.a. > Length: 31 km (Austria‘s longest district heating pipeline) > Diameter: up to 450 mm Krems Traismauer Zwentendorf St. Pölten 1 2 3 4 Projects 46
Slide 47: Energy Trade and Supply – 50th biomass heating plant Mittleres Schwarzatal
Energy Trade and Supply – 50th biomass heating plant „Mittleres Schwarzatal“ > EVN is the largest provider of natural heat in Austria > Start of operations: September 2010 > Investments: EUR 17.5m > Use of biomass: 75,000 loose cubic metres of wood chips p.a. > Reduction of CO2 emissions: 14,000 ton
Slide 48: Energy Supply South East Europe – Cogeneration plant in Plovdiv, Bulgaria
Energy Supply South East Europe – Cogeneration plant in Plovdiv, Bulgaria > Generation of electricity and heat > Start of construction: 2009/10 > Start of operations: end 2011 > Capacity: - Electricity: 54 MW - Heat: 50 MW > Investments: EUR 50m > Most modern cogeneration plant in the Balkans > Incr
Slide 49: Energy Supply South East Europe – Gas distribution and supply in Croatia
Energy Supply South East Europe – Gas distribution and supply in Croatia > Concession agreement for the gas distribution and supply in Dalmatia (Zadar, Sibenik and Split), Croatia > Start-up: 2011 > Investments: EUR 105m > Concession period: 30 years > Supply of 130,000 customers > Start of construc
Slide 50: Environmental Services – Waste incineration plant Line 3, Dürnrohr
Environmental Services – Waste incineration plant Line 3, Dürnrohr > Start of operations: Early 2010 > Total capacity: 500,000 tons of household residual waste and bulky waste as well as industrial and commercial waste materials treated each year > Most modern and largest waste incineration plant in
Slide 51: Environmental Services – Wastewater treatment plants in Turkey and Poland
Environmental Services – Wastewater treatment plants in Turkey and Poland Istanbul, Turkey: > June 2010: Completion and start of operation of the wastewater treatment plant in Istanbul, Turkey > Capacity: 2.0 m population equivalents (PE) > Total project volume: EUR 108.5m Stettin, Poland: > May 201
Slide 52: Environmental Services – Further contracts in Moscow and Cyprus
Environmental Services – Further contracts in Moscow and Cyprus Moscow: > December 2009: Acceptance of a tender to construct another waste treatment plant in Moscow > Project volume: EUR 707.7m > Capacity: 700,000 tons p.a. Cyprus: > October 2009: Contracts for the construction of two wastewater tre
Slide 53: Appendix – Financial performance HY. 2010/11
Appendix Financial performance HY. 1 2010/11 53
Slide 54: Business highlights
Business highlights > Cold winter in Austria once again > Progress within the framework of the „roadmap“ between the Macedonian government and EVN - Approval of the Energy Law by the Macedonian parliament - Increase of the end customer prices for electricity - Successful end to court proceedings wit
Slide 55: Business development
Business development 2010/11 Change > Slight increase in Group revenue due to EURm 2009/10 HY. 1 Veränd in % - positive development in the Environmental EUR m Services segment % Revenue 1,629.7 0.3 - despite lower revenue in energy business Revenue 00.0 –0.0 due to EBITDA 324.1 3.6 EBITDA • changed
Slide 56: EBITDA development in segments
EBITDA development in segments EURm Generation Network Infrastructure Energy Trade and Energy Supply South Environmental Austria Supply East Europa Services 160.0 152.4 138.7 140.0 120.0 100.0 Mio. EUR 84.8 79.7 80.0 60.0 44.7 41.8 44.9 40.0 32.0 17.4 20.0 11.0 0.0 HY. 1. HJ1 HY. 1. HJ1 HY. 1 1. HJ
Slide 57: Generation
Generation Electricity generation 2010/11 Change > Decrease in energy generation volumes volumes (GWh) HY. 1 in % - Lower power generating volumes at Total 1,875 –20.6 EVN‘s own thermal power stations thereof thermal > Revenue decrease 1,361 –25.7 energy sources - Declining spreads between electrici
Slide 58: Network Infrastructure Austria
Network Infrastructure Austria Network distribution 2010/11 Change > Diverse network distribution volumes volumes (GWh) HY. 1 in % development Electricity 4,132 3.7 - Increase in electricity distribution volumes due to positive economic development Gas1) 11,891 –11.5 - Decrease in gas distribution v
Slide 59: Energy Trade and Supply
Energy Trade and Supply Sales volumes to end 2010/11 Change > Higher sales volumes to end customers customers (GWh) HY. 1 in % - Electricity: Electricity 3,864 4.4 • Positive economic development Natural gas 5,552 2.9 • Expansion of EnergieAllianz outside Austria Heat 1,176 10.2 - Gas and heat: • We
Slide 60: Energy Supply South East Europe
Energy Supply South East Europe Network distribution 2010/11 Change > Different sales volumes development volumes (GWh) HY. 1 in % - Bulgaria: higher electricity and lower heat sales volumes at slightly higher temperatures Electricity 7,497 1.0 - Macedonia: decrease in electricity sales Heat 195 –8.
Slide 61: Environmental Services
Environmental Services 2010/11 Change > First-time earnings contribution of EURm HY. 1 in % projects: Revenue 171.8 65.3 - Home market: EBITDA 32.0 – • Line 3 of the waste incineration plant EBIT 19.6 – in Dürnrohr Profit before income tax 25.1 – - International project business: • Waste incineratio
Slide 62: Income from investment
Income from investment EURm 82.8 > Higher results from investments in equity 80 accounted investees 70.2 - RAG: up from EUR 12.2m to EUR 23.8m 70 - EconGas: up from EUR 7.2m to EUR 9.1m 60 53.0 24.5 - BEWAG/BEGAS: up from EUR 3.7m 50 to EUR 4.0m 40 > Lower gain from other investments 30 - VERBUND AG
Slide 63: Balance sheet
Balance sheet 2010/11 Change 1) > Increase of total assets EURm HY. 1 in % > Strong increase in equity Total assets 7,356.7 9.3 - Share capital increase of 10% Equity 3,540.2 17.0 - Positive market valuation of EVN‘s Equity ratio (in %) 48.1 3.2p shareholding in VERBUND AG Net debt 1,341.7 –8.0 > In
Slide 64: Cash flow
Cash flow 2010/11 Change > Higher Gross cash flow EURm HY. 1 in % - Lower profit before income tax Gross cash flow 294.5 1.9 - Higher depreciation and amortisation Net cash flow from - Higher non-cash income from investments 221.3 – in equity accounted investees operating activities > Increase of Ne
Slide 65: Investments
Investments EURm 175 171.6 > Investment drop 15.7% > Key investments 150 35.4 144.7 - Generation 27.9 125 • Wind power and small scale hydro power 46.8 projects in Lower Austria 100 - Network Infrastructure Austria 50.3 6.6 • Construction of the natural gas transport 75 pipelines „Süd-/Westschiene“
Slide 66: Disclaimer
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
Slide 67: EVN Investor Relations
EVN Investor Relations Additional Information: Stefan Szyszkowitz Investor information on the web Chief Financial Officer Phone +43 2236 200-12132 www.evn.at Fax +43 2236 200-82132 www.evn.at/investor.aspx E-Mail stefan.szyszkowitz@evn.at www.evn.at/Responsibility.aspx E-Mail: investor.relations@evn