Development of business in the first half-year of 2009/10 (October 1, 2009 - March 31, 2010)

(PresseBox) ( Maria Enzersdorf, )
- Sales development in the energy business shaped by cold weather
- Conclusion of all projects encompassed in the Energy Concept for the Lower Austrian Central Region
- First international hydropower project with Verbund AG
- New contract for construction of a wastewater purification plant in Cyprus
- Positive outlook confirmed for the 2009/10 financial year

Compared to the same period in the previous year, the energy sector environment in the first halfyear of 2009/10 (October 1, 2009 - March 31, 2010) was characterised by lower temperatures in Austria and Macedonia and higher temperatures in Bulgaria. Despite the slight recovery of the global economy in the last quarter 2009 primary energy and wholesale electricity prices as well as the costs of CO2 emission certificates remained unchanged below the previous year's level.

Increase in EBIT and group net profit continuous to be strong

In the 1st halfyear 2009/10, EVN's total revenue rose by 0.6% to EUR 1,625.1m despite the difficult market environment. Whereas electricity tariffs in Austria remained stable in the 1st halfyear 2009/10, gas prices could be reduced by about 7.0% on December 1, 2009, following previous selling price decreases in January and March 2009. The comparatively cold winter led to greater energy demand for electricity, gas and heat. In the Energy business, revenue increased in the Network Infrastructure Austria and the Energy Supply South East Europe segments but mainly declined in the Generation segment due to declining market prices and the lower volume of electricity generated by renewable energy sources. Total revenue of the Environmental Services segment slightly fell due to a weatherrelated decline in the international project business dispite increases from the ongoing operation of the waste incineration plant.

Despite higher sales volumes in the energy business, the item "Electricity purchases and primary energy expenses" decreased significantly. This can be attributed to the declining wholesale prices for electricity and primary energy. The item "Cost of materials and services" fell respectively. Despite a slight increase in personnel expenses and the rise in depreciation and amortisation mainly as a consequence of the high level of investments within the previous years and the initial consolidation of and despite of higher other operating expenses, EBIT climbed 5.7% to EUR 194.4m compared to the previous year's level.

The financial results developed extremely positively and amounted EUR 71.7m, up EUR 40.4m compared to the prioryear figure. Income from investments in associates included at equity rose; income from other investments was above the previous year's level, due to the higher dividend distributed by Verbund AG. Interest income improved and the item "Other financial results", which had been negatively affected in the previous year by the financial and economic crisis, also made a positive contribution. Accordingly, the profit before income tax totalled EUR 266.1m, a rise of 23.6% from the previous year's level. Hence, group net profit amounted to EUR 208.5m, an increase of 23.5%.

The gross cash value rose in the first halfyear 2009/10, climbing by 19.9% to EUR 288.9m. Since the balance sheet date on September 30, 2009, the balance sheet total of EVN rose by 2.1% to EUR 6,836.1m. Equity decreased by 0.6% to EUR 3,109.7m. The equity ratio amounted to 45.5%. Taking account of the net debt of EUR 1,514.2m, the gearing at the reporting date of March 31, 2010 was 48.7%, significantly lower than at the same period in the previous year (54.0%).

Projects for the Lower Austrian Central Region have been concluded

Two years ago EVN announced several projects for the Lower Austrian Central Region with an investment volume totalling more than EUR 200m. By putting the remaining three facilities into operation, EVN has completely and successfully implemented all the planned projects. Besides the heating transmission pipeline from Dürnrohr to Sankt Pölten with a length of 31 kilometres, which was put in operation the beginning of October 2009, the third thermal waste utilisation line in Zwentendorf featuring a capacity of 225,000 tonnes was put into full operation and had thermally treated some 65,000 tonnes of waste by the end of March. Furthermore, a tubular belt conveyor began operating in March 2010 in order to optimize the procurement and delivery of fuel for the power plant in Dürnrohr. In the future, 50% of the energy sources will be transported by the environmentallyfriendly waterways and then brought from the Danube river bank to the Dürnrohr power station using a coated conveyor belt.

Realisation of and new projects in the Environmental Services segments

On March 3, 2010, after only 22 months of construction, the official opening ceremony of the new wastewater purification plant for the municipality of Tulln, Lower Austria, took place. The project foresees a twophased construction plan. In the initial extension stage, which has already been put into operation, the wastewater of 22,500 population equivalents will be treated on a fully biological basis. In a further extension stage, the plant will be expanded to up to 45,000 population equivalents. The total investments costs for the project amount to EUR 11.5m. At the beginning of February 2010, EVN in its role as a member of a consortium with a local construction company was awarded a contract to build a new wastewater purification plant in North Nicosia, Cyprus, and subsequently operate it for a period of ten years. The project involves a total investment volume of EUR 45.0m and a capacity of approximately 30,000 m³ per day or 270,000 population equivalents, and will include a combined sludge treatment and biogas facility. Construction is expected to be completed in 27 months.

First international hydropower project with Verbund AG

On April 21, 2010, the first international partnership between EVN and Verbund AG was concluded with the signing of the syndicate agreement for the construction of the Ashta hydropower station in Albania. Both companies will own a 50% shareholding in the power plant on the Drin River, to be built at a total cost of about EUR 200m. The facility is conceived to boast a capacity of more than 50 MW and is designed to generate more than 240 million kilowatt hours of electricity to supply around 100,000 Albanian households.


After the first six months of the new financial year, we expect - from today's perspective - a Group net profit for 2009/10 as a whole exceeding the comparable figure for the previous year, despite difficult and the continuous uncertain development of overall economic conditions and high price volatility in the energy sector.

The complete Letter to Shareholders HY. 1 2009/10 is available at
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