E.ON SE · XETR:EOAN
E.ON — H1 2013 Earnings Presentation
37 slides from E.ON's earnings presentation, Aug 13, 2013
Slide 1: First half 2013 Results Cleaner & better energy
First half 2013 Results Cleaner & better energy Johannes Teyssen, CEO Marcus Schenck, CFO August 13, 2013
Slide 2: Financials
Financials EBITDA1: -15% to €5.7bn EBIT1: -18% to €4.0bn H1 2013 Underlying net income1: -42% to €1.9bn financial Underlying EPS1, 2: -42% to 1.00 € per share highlights Operating cash flow: +65% to €4.1bn Economic net debt: from €35.9bn3 to €33.3bn EBITDA1: €9.2bn – €9.8bn FY 2013 (un
Slide 3: Recent strategic and operational developments
Recent strategic and operational developments Renewables Distributed Energy Inauguration 60 MW CHP for Evonik’s Marl chemical park London Array Energy partner of IBM for new turnkey data centers Amrumbank West on track First small-scale CHP units of partnership with Metro entered service
Slide 4: E.ON 2.0
E.ON 2.0 Breakdown of 2015 gross cost savings Implementation of 2015 gross cost savings €bn 10% Generation 26% Renewables 2,0 26% Global Commodities 3% Germany 1,5 5% Other EU countries Other 30% 1,0 HR impact 0,5 Target ~11,000 net FTE reduction by 2015 vs. 2010 0,0 Implementation Jan Apr Jul Oct
Slide 5: Restructuring of conventional generation
Restructuring of conventional generation Newly announced shutdowns & mothballings Already implemented shutdowns & mothballings GW Tavazzano 8 300 MW Mothballing Q2 2013 Tavazzano 8 Malzenice 418 MW Mothballing Q4 2013 6 Staudinger 1 Kiel1 162 MW Shutdown Q4 2015 Shamrock 1-4 Provence 4 Alterna
Slide 6: Conclusion
Conclusion Delivering on strategy Environment remains challenging We have already delivered much of our Central European power forwards at 8 year strategy lows Highly successful portfolio streamlining Inadequate adjustments to European ETS Substantial improvement of efficiency Profitable e
Slide 7: Key drivers of Group EBITDA development
Key drivers of Group EBITDA1 development First half in € billion EBITDA H1 2012 6.7 E.ON 2.0 0.3 Lower H1 nuclear fuel tax 0.2 Renewables (EC&R) 0.1 E&P 0.1 Czech one-off 0.1 Gas midstream -0.7 Divestments -0.4 Revaluation one-off 2012 -0.2 Power price and volume effect -0.2 Absence of free CO2 cert
Slide 8: E.ON Group – Underlying net income
E.ON Group – Underlying net income1 First half 2013 in € million 2013 2012 +/- % EBITDA1 5,695 6,696 -15 Depreciation/Amortization recognized in EBIT1 -1,728 -1,832 - Economic interest expense (net) -890 -725 - EBT (earnings before tax)1 3,077 4,139 -26 Income taxes on EBT1 -893 -613 - % of EBT1 29
Slide 9: Operating cash flow – Reconciliation
Operating cash flow – Reconciliation1 First half 2013 in € billion 01.01.2012 - 30.06.2012 2.5 Group: refundable tax payment H1 2012 1.6 Operating cash flow H1 2012 adj. for tax effect 4.1 EBITDA -1.0 Revaluation one-offs 2012 0.2 Delayed cash-in from Gazprom settlement in 2012 1.0 Gas: higher net e
Slide 10: E.ON Group – Economic net debt
E.ON Group – Economic net debt June 30, 2013, in € billion Dec 31, 2012 Jun 30, 2013 Net financial Net financial position: position: -14.7 -13.1 -35.9 -36.4 -33.3 +1.0 +4.1 -4.5 +5.2 -2.2 -1.0 Operating Pension Divestments Cash Flow Obligations1 Investments Dividends Other H1 net debt profiting from
Slide 11: Disposal proceeds and dilution overview
Disposal proceeds and dilution overview Disposal proceeds 1,2 EBITDA effect of disposals in 2013 and 2014 (€bn) Gazprom €3.4bn 1,4 Central Networks €4.8bn Disposal impact 2014 1,2 Disposal impact 2013 Open Grid Europe €2.9bn 50% of Horizon €0.4bn 1 E.ON Rete €0.3bn HSE Shares €0.3bn 0,8
Slide 12: Structural impacts on segmental EBITDA
Structural impacts on segmental EBITDA Region Germany – Main EBITDA drivers (€bn) Global Commodities – Main EBITDA drivers (€bn) Disposals of three regional utility companies and Larger effect from absence of significant positive E.ON Energy from Waste major driver one-offs in year 2012 Absenc
Slide 13: Outlook 2013 - Overview
Outlook 2013 - Overview EBITDA1: €9.2 – 9.8bn Underlying net income1: €2.2 – 2.6bn Underlying EPS1, 2: 1.15 – 1.35 €/share Dividend pay-out ratio3: 50-60% Outlook 2013 confirmed 1. Adjusted for extraordinary effects 2. Based on number of shares outstanding (1,907 million) 3. As percentage of
Slide 14: Appendix
Appendix
Slide 15: Generation – Conventional portfolio
Generation – Conventional portfolio Main retirements 2012 Grain 1 & 4 1,300 MW UK CCGT LCPD Shutdown Nov 2012 1,300 MW Staudinger 3 293 MW Germany Steam Economic Shutdown Dec 2012 1,593 MW Veltheim 2 & 4 285 MW Germany Steam Economic Shutdown Dec 2012 1,878 MW Ironbridge 1-2 940 MW UK Steam
Slide 16: Market environment EGC gas storage business
Market environment EGC gas storage business E.ON gas storage portfolio1 TTF summer/winter forward spreads Germany/Austria: ~ 95 TWh working gas volume €/MWh United Kingdom: ~ 2 TWh working gas volume 6 Hungary: E.ON Földgas divested 4 2013/14 2014/15 2 0 2010 2011 2012 2013 TTF volatility2 60%
Slide 17: Implications of law on nuclear repository selection
Implications of law on nuclear repository selection What happened On June 28th the German Bundestag adopted the Act on the selection of a repository site for high-level radioactive waste (Standortauswahlgesetz) On July 5th the Bundesrat unanimously approved the new legislation The result is no
Slide 18: E.ON Group – Financial highlights
E.ON Group – Financial highlights First half 2013 in € million 2013 2012 +/- % Sales 64,643 65,402 -1 EBITDA1 5,695 6,696 -15 EBIT1 3,967 4,864 -18 Underlying net income1 1,911 3,303 -42 Operating cash flow 4,080 2,479 +65 Investments2 4,529 2,720 +67 Economic net debt -33,309 -35,9344 +2,6253 1. Ad
Slide 19: E.ON Group – EBITDA and EBIT by segments
E.ON Group –EBITDA1 and EBIT1 by segments First half 2013 in € million EBITDA1 EBIT1 2013 2012 +/- % 2013 2012 +/- % Generation 915 1,161 -21 490 727 -33 Renewables 793 690 +15 580 493 +18 Global Commodities 714 1,805 -60 648 1,679 -61 Exploration & Production 461 337 +37 243 197 +23 Germany 1,402 1
Slide 20: E.ON Group – From EBITDA to net income (1/2)
E.ON Group – From EBITDA1 to net income (1/2) First half 2013 in € million 2013 2012 +/- % EBITDA1 5,695 6,696 -15 Depreciation/Amortization/Impairments -1,728 -1,832 - EBIT1 3,967 4,864 -18 Economic interest expense (net) -890 -725 - Net book gains 1,832 67 - Restructuring and cost-management expen
Slide 21: E.ON Group – From EBITDA to net income (2/2)
E.ON Group – From EBITDA1 to net income (2/2) First half 2013 in € million 2013 2012 +/- % Income/Loss from continuing operations before income taxes 4,179 3,381 +24 Income taxes -820 -288 - Income tax rate (in %) 20 9 - Income/Loss from continuing operations 3,359 3,093 +9 Income/Loss from disconti
Slide 22: EBITDA by unit – Generation
EBITDA1 by unit – Generation First half 2013 in € million 2013 2012 +/- % Nuclear 628 357 +76 Steam 275 738 -63 CCGT 24 118 -80 Other/Consolidation -12 -52 - EBITDA1 915 1,161 -21 Main effects (in € bn): Nuclear (+0.3) Driven by higher volumes in Sweden and Germany and a one-off (+0.1) Timing of
Slide 23: EBITDA by unit – Renewables
EBITDA1 by unit – Renewables First half 2013 in € million 2013 20122 +/- % Hydro 424 387 +10 Wind, solar and other 369 303 +22 EBITDA1 793 690 +15 Main effects (in € bn): Hydro (+/-0) Main positive effect: Absence of negative prior year one-off related to a pumped storage plant Lower own generat
Slide 24: EBITDA by unit – Global Commodities
EBITDA1 by unit – Global Commodities First half 2013 in € million 2013 2012 +/- % Proprietary Trading -13 -31 - Optimization 641 1,282 -50 Infrastructure shareholdings / other / consolidation 86 554 -84 EBITDA1 714 1,805 -60 Main effects (in € bn): Optimization (-0.6) Mainly driven by absence prio
Slide 25: EBITDA by unit – Exploration & Production
EBITDA1 by unit – Exploration & Production First half 2013 in € million 2013 2012 +/- % Exploration & Production 461 337 +37 Main effects (in € bn): North sea Higher volumes mainly from Skarv (+0.2) Increased opex driven by new fields Skarv and Hyme 1. Adjusted for extraordinary effects 24
Slide 26: EBITDA by unit – Germany
EBITDA1 by unit – Germany First half 2013 in € million 2013 20122 +/- % Distribution 1,097 933 +18 Sales/Other 305 288 +6 EBITDA1 1,402 1,221 +15 Main effects (in € bn): Distribution (+0.2) Positive drivers mainly lower controllable cost, but also profiting from segment internal business transfer
Slide 27: EBITDA by unit – Other EU countries
EBITDA1 by unit – Other EU countries First half 2013 in € million 2013 2012 +/- % Distribution 723 660 10 Sales 430 386 11 Other/Consolidation 208 257 -19 EBITDA1 1,361 1,303 +4 Main effects (in € bn): Distribution (+0.1) Strong improvement in Czech (+0.1) mainly renewables driven (largely one-off
Slide 28: EBITDA by unit – Non-EU-Countries
EBITDA1 by unit – Non-EU-Countries First half 2013 in € million 2013 2012 +/- % Russia 355 350 +1 Other Non-EU-Countries -41 0 - EBITDA1 314 350 -10 Main effects (in € bn): Russia (+/-0) Increased earnings from higher prices on the energy market and increased capacity fees partly offset by higher
Slide 29: E.ON Group – Economic net debt
E.ON Group – Economic net debt First half 2013 in € million Jun 30, 2013 Dec 31, 2012 Liquid funds 6,393 6,546 Non-current securities 4,268 4,746 Total liquid funds and non-current securities 10,661 11,292 Financial liabilities to banks and third parties -22,801 -25,014 Financial liabilities resulti
Slide 30: E.ON Group – Cash effective investments by unit
E.ON Group – Cash effective investments by unit First half 2013 in € million 2013 2012 +/- % Generation 288 485 -41 Renewables 396 731 -46 Global Commodities 80 199 -60 Exploration & Production 245 255 -4 Germany 452 297 +52 Other EU countries 353 367 -4 Non-EU Countries1 2,670 396 - Group Managemen
Slide 31: Financial liabilities of the E.ON Group
Financial liabilities of the E.ON Group First half 2013 in € billion Maturity profile (as of 30 June 2013)3 30 June 2013 31 Dec 2012 Bonds1 18.3 20.7 in EUR 10.4 12.0 in GBP 4.3 4.5 in USD 2.3 2.3 in CHF 0.6 0.9 in SEK 0.1 0.1 in JPY 0.4 0.7 other currencies 0.2 0.2 Promissory notes 0.8 0.8 Commerci
Slide 32: E.ON Group – Economic interest expense (net)
E.ON Group – Economic interest expense (net) First half 2013 in € million 2013 2012 Delta ‘13 / ’12 Interest from financial assets/liabilities -486 -561 +75 Interest cost from provisions for pensions -77 -67* -10 and similar provisions1 Accretion of provisions for retirement obligation -412 -430 +18
Slide 33: Oil & Gas production
Oil & Gas production in mboe 2013 +/- % 2012 Skarv 3.5 - 0.0 Njord 1.7 -6% 1.8 Elgin-Franklin 0.3 -40% 0.5 Babbage 0.4 -20% 0.5 Rita 0.0 - 0.0 Total North Sea 7.3 +103% 3.6 Yuzhno Russkoje 18.6 -3% 19.2 Total 25.9 14% 22.8 32
Slide 34: Outright power hedging
Outright power hedging Hedging (as per end ofJune, 2013) Central Europe: Outright power hedging 2013 ~ 58 €/MWh 2014 ~ 53 €/MWh 2015 ~ 46 €/MWh 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Nordic: Outright power hedging 2013 ~ 44 €/MWh 2014 ~ 43 €/MWh 2015 ~ 38 €/MWh 0% 10% 20% 30% 40% 50% 60% 70% 80
Slide 35: E.ON Investor Relations Contact
E.ON Investor Relations Contact Dr. Marc Spieker Head of IR T+49 2 11-45 79-3 45 marc.spieker@eon.com Peter Blankenhorn Regions/Sales, SRI, Retail, T +49 2 11-45 79-4 81 Facts & Figures peter.blankenhorn@eon.com François Poullet Generation, Gas T +49 2 11-45 79-3 32 francois.poullet@eon.com Marc Koe
Slide 36: E.ON IR - Reporting calendar & important links
E.ON IR - Reporting calendar & important links Reporting calendar Date Event November 13, 2013 Interim Report III: January – September 2013 March 12, 2014 Annual Report 2013 April 30, 2014 2014 Annual Shareholders Meeting May 2, 2014 Dividend Payout May 13, 2014 Interim Report I: January – March 201
Slide 37: Disclaimer
Disclaimer This presentation may contain forward-looking statements based on current assumptions and forecasts made by E.ON Group Management and other information currently available to E.ON. Various known and unknown risks, uncertainties and other factors could lead to material differences between