EQS-News: VERBUND AG: 2022 annual results: VERBUND posts encouraging business performance in 2022

EQS-News: VERBUND AG / Key word(s): Annual Results
VERBUND AG: 2022 annual results: VERBUND posts encouraging business
performance in 2022

16.03.2023 / 07:59 CET/CEST
The issuer is solely responsible for the content of this announcement.

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Difficult geopolitical and energy market developments cast a shadow over
2022, radically changing the conditions in the energy industry.
Particularly the war in Ukraine caused significant distortion in Europe’s
energy markets that led to rocketing prices and extreme price volatility,
along with marked shifts in supply and demand structures. Prices for
primary energy sources shot up during the course of the year, with gas
prices in particular being hugely affected by changes in gas supply
volumes and the off-take structure. European wholesale prices for
electricity likewise continued their upward trend fuelled by soaring
global market prices for primary energy and the increasing market risks,
reaching fresh highs as the year went on. In response to the headwinds in
the European energy sector and to address the severe price pressure on
residential and industrial customers alike, discussions about market
intervention and taxing windfall profits were initiated at both EU and
national level and steps were taken. In addition, the Austrian federal
government and VERBUND implemented measures to slow the rise in prices to
the consumer. However, the discussions and decisions relating to market
intervention generated considerable uncertainty in the capital markets and
put downward pressure on VERBUND’s share price, which fell by 20.5% in
2022. This meant that VERBUND’s share price performance was slightly below
that of the Austrian ATX (full-year performance –19.0%) and far below that
of the European sector index STOXX Europe 600 Utilities (full-year
performance –11.1%). Nevertheless, with a market capitalisation of €27.3bn
VERBUND was still Austria’s largest listed company at the end of 2022 by a
large margin.

Significant improvement in VERBUND’s results for financial year 2022

EBITDA climbed by 100.2% to €3,160.7m. The Group result surged by 96.6% to
€1,717.0m compared with the same period of the previous year. Particularly
as a consequence of the dry summer, the volume of electricity VERBUND
generated from its run-of-river power plants in financial year 2022 was
well below average. The hydro coefficient dropped to 0.86, or 9 percentage
points below the prior-year figure and 14 percentage points below the
long-term average. The reduced volume of electricity generated from
hydropower had a pronounced negative impact on the development of
earnings. The underproduction of hydropower made it necessary to purchase
large volumes of electricity so that the electricity volumes that had
already been sold on the basis of the long-standing hedging strategy could
be delivered. Due to the market conditions, these repurchases had to be
made at exceedingly high prices in some cases, which put additional
pressure on earnings. The taxation of the windfall revenues of
inframarginal power generators in Austria and Germany from December 2022
and corresponding windfall profits in Romania and Spain also had a
negative impact on the Group’s result. By contrast, the sharp increase in
wholesale electricity prices on the futures and spot markets in particular
gave a significant boost to earnings. The average sales prices obtained
for VERBUND’s own generation from hydropower rose by €60.2/MWh to
€115.1/MWh. The New renewables segment also made a bigger contribution to
earnings on the strength of higher average prices and the rise in output.
The significantly higher contribution from flexibility products likewise
had a positive effect. Moreover, the Group result for financial year 2022
was influenced by non-recurring effects totalling €–37.9m (2021: €+75.0m).
Adjusted for these non-recurring effects, the Group result rose by 119.8%
to €1,754.9m.

Higher dividend

A dividend of €3.60 per share for financial year 2022 will be proposed to
the Annual General Meeting on 25 April 2023. This dividend breaks down
into a regular dividend of €2.44 per share plus a special dividend of
€1.16 per share. The payout ratio (regular dividend plus special dividend)
calculated on the basis of the reported Group result amounts to 72.8% for
2022 and the payout ratio calculated on the basis of the Group result
after adjusting for non-recurring effects is 71.3%. The payout ratio for
2022 in relation to the regular dividend will thus be 48.3% based on the
adjusted Group result.

Forecast for 2023

Based on expectations of average levels of own generation from hydropower,
wind power and solar power as well as the opportunities and risks
identified, VERBUND expects EBITDA of between around €3,500m and €4,400m
and a Group result of between around €1,900m and €2,500m in financial year
2023. VERBUND’s planned payout ratio for 2023 is between 45% and 55% of
the Group result of between around €1,900m and €2,500m, after adjusting
for non-recurring effects.

 

KPIs Unit 2021 2022 Change
Revenue */** €m 4,776.6 10,346.1 116.6%
EBITDA €m 1,579.0 3,160.7 100.2%
Operating result €m 1,266.8 2,626.2 107.3%
Group result €m 873.6 1,717.0 96.6%
Earnings per share € 2.51 4.94 96.6%
EBIT margin */** % 26.5 25.4 –
EBITDA margin */** % 33.1 30.5 –
Cash flow from operating activities €m 98.2 2,019.9 –
**
Free cash flow before dividends ** €m –1,010.1 452.1 –
Free cash flow after dividends €m –1,329.5 –25.7 –
Net debt/EBITDA X 2.2 1.2 –
Performance of VERBUND shares % 41.6 –20.5 –
(Proposed) dividend per share € 1.05 2.44 132.4%
(Proposed) special dividend per € – 1.16 –
share
Share of generation from renewables % 96.4 95.6 –0.8%
Specific GHG emissions (Scope g CO[2]e/kWh 13.9 16.8 20.9%
1/total electricity
generated) ***

 

* calculation adjusted retrospectively in accordance with IAS 8 in
financial year 2019 with effect from 1 January 2018

** calculation adjusted retrospectively in accordance with IAS 8 in
financial year 2021 with effect from 1 January 2020

*** from electricity generation and transmission (excl. GCA) as a
percentage of total electricity generated (incl. purchase rights, excl.
electricity generated for district heating). Preliminary figures before
ETS audit

Additional information as well as non-financial KPIs can be found in the
Integrated Annual Report 2022, available on the website www.verbund.com >
About VERBUND > 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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16.03.2023 CET/CEST 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: 1583759

 
End of News EQS News Service

1583759  16.03.2023 CET/CEST