A key step in counteracting this situation is to successfully restructure thermal power plant generation, which is progressing rapidly. At the start of October, VERBUND reached agreement with international investor KKR on selling the French Pont-Sur-Sambre and Toul combined cycle gas turbine power plants. The sale puts a stop to the negative earnings contributions and cash outflows from these power plants. Our withdrawal from Sorgenia in Italy was already finalised at the end of July. It is expected that the creditor banks will take over the company. Thus VERBUND will divest itself of its 46% share by the end of the year. In Austria, the Dürnrohr hard coal power plant will be closed as planned following closure of the Neudorf-Werndorf oil-fired district heating plant. The temporary shutdown of the Mellach CCGT has been postponed due to a temporary injunction ordered by a Styrian court.
In quarters 1–3/2014, results were considerably lower than in the previous year, but still better than expected. The primary reason for the significant decrease was that the 2013 results had received a very substantial boost from the sale of Turkish activities and the concurrent purchase of hydropower plants in Germany. Results were also negatively impacted by the further decline in electricity sales prices, a lower water supply than in the previous year and impairment losses on the Romanian wind farms. Tax effects related to the sale of the French CCGTs had a positive impact. EBITDA decreased by 42.8% to €633.0m and the Group result dropped by 86.4% to €63.8m. After adjustment for non-recurring effects, EBITDA declined by 25.4% to €688.1m and the adjusted Group result fell by 48.5% to €174.2m.
VERBUND has raised its earnings forecast due to the better-than-expected water supply in the third quarter and margins from the electricity business as well as additional cost reductions. Based on average own generation from hydropower in the fourth quarter, it is anticipated that EBITDA will amount to approximately €770m and the Group result to approximately €85m in financial year 2014. The planned payout ratio for 2014 remains at approximately 50% of the Group result of approximately €190m after adjustment for non-recurring effects.