Verbund 2007: once again a very positive result development

The sales revenue of the Verbund Group increased by 5.6 % to 3,038.3 million Euro in 2007. The operating result rose by 13.6 % to 916.1 million Euro and the group result was up 15.6 % at 579.2 million Euro. At the end of fiscal 2007, the Verbund share closed with a positive performance of 18.5 %. The Managing Board of the Verbund Group will recommend to the General Meeting that the dividend be increased by 20 % from 0.75 Euro/share to 0.90 Euro/share.

The control-specific group ratios for the Verbund Group were also significantly improved: Economic Value Added (EVA), the ratio for value creation within the Verbund Group, rose by 15.3 % to 405.8 million Euro. Net gearing was reduced from 73.7 % to 65.9 % and the operating cash flow was up 53.8 million Euro at 807.6 million Euro. The EBIT margin rose from 28.0 % to 30.2 %.

Michael Pistauer, Chairman of the Verbund Managing Board: "Our business success is attributable to the forward looking strategy of hedging our own electricity generation, the strong position the company has secured in the domestic market and the successful expansion of the joint ventures abroad." 

Thanks to the consistent hedging strategy, approx. 60 % of the total volume of electricity generated was already sold at increased market prices on the European sales markets in 2006 on a year-ahead basis for 2007. Electricity sales in Austria rose by 4 % compared to 2006 and foreign sales were up 2 %. 

Slight improvement in group generation
In spite of the below-average water supply with a hydro coefficient that lay 3 % below the long-term average, total generation within the group increased to 28,307 GWh due to the increased utilization of the storage power plants. This corresponds to an improvement of 0.8 % on the level recorded in the previous year. In total, generation in the Verbund hydropower plants increased by 467 GWh (+2 %) compared to 2006. Thermal generation did, however, decline by 247 GWh (-5.8 %) due to the closure of Voitsberg power plant in May 2006.

Profitable growth through investments
Pistauer: "We will invest 6.7 billion Euro in value-generating growth up to 2015. 40 % will be invested in Austria and 60 % abroad. In the process, Verbund will more than double its generation capacity." Verbund plans to strengthen its good market position in the coming years through a highly focused investment policy. The concentration on hydropower and other renewable sources of energy, the expansion of market leadership in Austria and the development of existing and new shareholdings abroad form the pillars of the strategic concept. The investment program that was approved in 2007 provides a total of 6.7 billion Euro for the expansion of generation capacities and electricity grids in Austrian and abroad up to 2015. Of this amount, approx 40 % will be invested in Austria and 60 % abroad.

In Austria, Verbund will focus on the expansion of hydropower generation and transmission capacities. Investments abroad will focus on strengthening the existing joint ventures in Italy, France and Turkey as well as on new projects in South East Europe.

Positive outlook
Taking account of the current conditions and on the basis of an average water supply, Verbund aims to achieve a further improvement in the results and key ratios in fiscal 2008. Another significant increase in the dividend is also planned.