Inside information: Settlement of all outstanding matters associated with the Mellach power plants site improves earnings forecast



Andreas Wollein Andreas Wollein

Head of Group Finance, M&A and Investor Relations

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VERBUND AG’s management is today announcing the imminent settlement of all outstanding matters associated with the agreement with Energie Steiermark to supply district heating from the Mellach power plants site.

VERBUND will in this regard erect a boiler plant at the Mellach site which is intended to satisfy the district heating supply agreement. As a result, VERBUND is giving itself the opportunity to close the Mellach hard coal power plant even earlier than in 2020, in line with its strategic focus on CO2-free electricity generation.

VERBUND is continuing to evaluate all the options for the Mellach combined cycle gas turbine power plant which is also located at the Mellach site.

The parties have agreed not to disclose any further details of the settlement.

Based on the effects of this settlement and accounting measurement effects, VERBUND AG’s management is increasing its earnings forecast for 2016. Assuming average water and wind supplies to the end of the year, VERBUND will achieve EBITDA of approximately €1,010m (previous forecast: €980m) and a Group result of approximately €410m (previous forecast: €385m). The adjusted 2016 Group result will remain unchanged at approximately €315m as the settlement and the accounting measurement effects are defined as non-recurring effects.