VERBUND first half-year Result 2003


Despite difficult overall economic conditions VERBUND is able to show for a very promising first half-year result.

Although the water regime for the first half-year was 2 % lower then the long-term average, VERBUND managed to continue the trend toward positive business development.

The operating result increased to 160.5 million € and thus lies 5.4 % above the results of last year's reference period.

VERBUND was able to profit from continuously rising wholesale prices within the power supply business in Europe. Prices for base load power and prices for the more valuable top power displayed a two-digit rate of increase. Experts attribute this price development to the shrinking reserve capacities and the increased market concentration in Germany. VERBUND expanded in almost all customer segments of distribution both in Austria and abroad and augmented its profitability.

The group result increased by 54.8 % to126.3 million €. The success factors are, in addition to the continuous dept clearance through the strong cash-flow of the group, a low level of bank interests, earnings from gains, one-off effects as well as the final sale of the EVN shares.

On July 11 of the reporting year, the EU commission approved the so-called "Austrian power solution" . Considering the progress in the liberalisation of the power market within the EU, the strategic partnership between VERBUND and the companies merged to EnergieAllianz will be a further strong competitor on the European market. Mario Monti, the concerned EU commissioner, expressly mentioned and approved this fact in his comments to the upcoming liberalisation of the market in Europe.

The approval was given in order to extend competition within the market for Austrian major customers. To achieve this goal, VERBUND is supposed to give up its shares in the final customer oriented companies MyElectric and Unsere Wasserkraft and sell its 55 percent share of the power distribution company APC to a third party not connected to the Austrian power solution. Alternatively, clients of the EnergieAllianz Major Customer Business e&s purchasing at least 3000 GWh power can be passed on to a competitor.

Because of these requirements, the fulfilment of the power solution will not be able to take place before the beginning of 2003. The originally estimated synergies amounting to approx. 40 million € can nevertheless be achieved.

This secures the position of a competitive, vertically integrated power provider with a quantitative turnover of approx. 100 TWh for the Austrian power solution, placing it amongst the ten largest power providers in Europe.