EQS-News: VERBUND AG: Results for quarter 1/2022: positive income trend fuelled by strongly increased sales prices for electricity

EQS-News: VERBUND AG / Key word(s): Quarter Results
VERBUND AG: Results for quarter 1/2022: positive income trend fuelled by
strongly increased sales prices for electricity

12.05.2022 / 07:58
The issuer is solely responsible for the content of this announcement.

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Prices for primary energy in the international procurement markets had
already rocketed in 2021. This trend was exacerbated by the outbreak of
the war in Ukraine in late February 2022. Supply shortages and low stocks
in Europe coupled with high demand were especially noticeable in the
development of gas prices. The uncertainty around gas deliveries created
by the geopolitical conflict in Eastern Europe further pushed up gas
prices and generated considerable volatility among commodities across the
board in the energy markets. As a consequence of the surge in global
market prices for primary energy and the high cost of emission allowances,
Europe also witnessed a rise in wholesale prices for electricity.

The geopolitical challenges are putting growing pressure on policy-makers
in Europe to exit from fossil fuels and reduce dependence on energy
imports. This calls for increased development of renewables as well as
accelerated expansion of grids and storage facilities. VERBUND can make an
important contribution to this. Over the coming years, for example,
VERBUND will invest heavily in power plant and grid expansion and continue
to guarantee security of supply in Austria.

The performance of VERBUND shares in quarter 1/2022 was impacted in
particular by the war in Ukraine and the knock-on effects on primary
energy prices. After reaching their high for the quarter on 28 February,
the shares experienced a sharp correction, followed by a volatile sideways
movement lasting until the end of the period now ended. Trading at a
closing price of €95.5 as at 31 March 2022, VERBUND shares recorded minor
losses of 3.4% in quarter 1/2022 against year-end 2021.

VERBUND saw a significant improvement in the results posted for quarter
1/2022. EBITDA climbed by 169.3% to €814.9m. The Group result soared by
255.6% to €514.4m compared with the same period of the previous year. The
hydro coefficient for the run-of-river power plants dropped to 0.94, or 5
percentage points below the prior-year figure and 6 percentage points
below the long-term average. Generation from VERBUND’s annual storage
power plants rose by 15.1% in quarter 1/2022 compared with the prior-year
reporting period. Generation from hydropower thus fell only slightly by 47
GWh. The sharp increase in wholesale electricity prices on the futures and
spot markets gave a significant boost to earnings. The average sales
prices obtained for VERBUND’s own generation from hydropower rose by
€66.3/MWh to €113.8/MWh. The consolidation of Gas Connect Austria GmbH,
the regulated gas transmission and distribution system operator in Austria
acquired with effect from 31 May 2021, likewise had a positive effect. The
contribution from flexibility products also rose significantly as a result
of greater volatility in the electricity market. In the Thermal generation
segment, increased use of the Mellach combined cycle gas turbine power
plant made a positive contribution to earnings. The Group result in
quarter 1/2022 was also bolstered by a positive non-recurring effect in
taxes on income in the amount of €56.6m. This effect results from the
revaluation of deferred tax as a consequence of the decision to lower
Austria’s corporate income tax rate in connection with the Eco-social Tax
Reform Act. The Group result after adjustment for this non-recurring
effect was €463.7m, an increase of 220.6% on the year-earlier figure.

Outlook for 2022 adjusted
Based on average own generation from hydropower, wind power and PV
production in quarters 2–4/2022 and the opportunities and risks
identified, VERBUND expects EBITDA of between approximately €2,800m and
€3,500m and a reported Group result of between approximately €1,550m and
€2,000m in financial year 2022. VERBUND is planning a payout ratio for
2022 of between 45% and 55% of the Group result of between around €1,500m
and €1,950m, after adjustment for non-recurring effects.

The earnings forecast and the information on the expected payout ratio are
contingent on not being impacted by possible energy policy measures to
skim off some of the profits at energy companies – something which is
currently being debated at European and national level.

         
KPIs        
  Unit Q1/2021 Q1/2022 Change
Revenue €m 818.1 2,531.9 209.5%
EBITDA €m 302.7 814.9 169.3%
Operating result €m 207.9 705.7 239.4%
Group result €m 144.7 514.4 255.6%
Earnings per share in € 0.42 1.48 255.6%
EBIT margin % 25.4 27.9 –
EBITDA margin % 37.0 32.2 –
Cash flow from operating activities €m 203.7 209.2 2.7%
Free cash flow before dividends €m 35.3 –105.1 –
Free cash flow after dividends €m 35.3 –105.1 –
Performance of VERBUND shares % –11.2 –3.4 –
Gearing % 26.7 60.7 –
         

 

Additional information as well as the Interim Financial Report for quarter
1/2022 is available on the website www.verbund.com > Investor Relations >
Latest financial results.

Contact: Andreas Wollein
Head of Group Finance and Investor Relations
T.: +43 (0)5 03 13 – 52604
F.: +43 (0)5 03 13 – 52694
investor-relations@verbund.com

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12.05.2022 This Corporate News was distributed by EQS Group AG.
www.eqs.com

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Language: English
Company: VERBUND AG
Am Hof 6A
1010 Wien
Austria
Phone: 0043-1-53113-52604
Fax: 0043-1-53113-52694
E-mail: investor-relations@verbund.com
Internet: www.verbund.com
ISIN: AT0000746409
WKN: 877738
Indices: ATX
Listed: Vienna Stock Exchange (Official Market)
EQS News ID: 1350285

 
End of News EQS News Service

1350285  12.05.2022 

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