- Hybrid bond with a volume of € 1 billion successfully placed
- Divestitures have already brought in around € 500 million
- The Fokus programme to sustainably boost efficiency is showing first signs of success
- Investment programme with a volume of € 4.1 billion concentrates on projects to implement the new energy concept
Karlsruhe. “The past fiscal year was not an easy year for the energy industry and therefore also not for EnBW. It is all the more pleasing that we were able to create the main conditions for further forward-looking investments, despite the difficult general environment. The measures we have taken to safeguard EnBW’s financial stability and its future sustainability are already bearing fruit,” says Hans-Peter Villis, CEO of EnBW Energie Baden-Württemberg AG.
With a volume of divestitures of around € 500 million already realised and a hybrid bond totalling € 1 billion, EnBW has already been able to successfully implement over recent months major elements of the package of measures to safeguard its good credit standing. For instance, EnBW divested its non-controlling interests in power stations in Poland and reduced its equity interest in Energiedienst Holding in Switzerland. All in all, EnBW plans to divest non-strategic equity interests and to optimise shareholdings in the amount of € 1.5 billion. EnBW’s successful placement of a hybrid bond with a volume of € 750 million on the capital market in October 2011 was followed by a further € 250 million at the beginning of April this year. Based on its terms and conditions, half of the amount of the bond will be recognised as equity by rating agencies until the first possible date of payment in 2017.
“The successful placement of the hybrid bond in a difficult capital market environment demonstrates the capital market’s trust in EnBW and its strategic orientation,” continues Villis.
Efficiency measures also constitute a further lever to ensure EnBW’s future sustainability. Within the framework of the Fokus project, the objective is to boost efficiency by a sustainable € 750 million p. a. with an effect on income before the end of 2014. EnBW succeeded in implementing measures involving € 190 million already before the end of 2011.
“Such measures are necessary prerequisites for EnBW to implement its planned investment programme of € 4.1 billion by 2014. The decision taken at this year’s annual general meeting on the upcoming capital increase of around € 800 million must be seen in this context,” explains Villis.
Capital expenditure of € 4.1 billion planned
Of the planned capital expenditure of € 4.1 billion, around half (about € 2 billion) is to be invested in growth projects, around one third in maintaining the existing portfolio and the remainder in expansion projects. With this investment programme, EnBW expressly demonstrates its commitment to the new energy concept. The company is consistently basing its business model and its two strategic moves “safeguarding low-carbon generation” and “establishing local generation services” on the new energy concept. By offering a wider range of local solutions, EnBW intends to position itself even more than in the past as an energy partner for municipalities, municipal utilities as well as industrial and retail customers.
An additional 3,000 MW of generation capacity from renewable energies to be added by 2020
By further expanding renewable energies, EnBW intends to safeguard its excellent position as low-carbon, and therefore climate-friendly, energy generation company, even when nuclear power is no longer available. In addition, it is planning to increase the share of power generation from renewable energy sources by a further 3,000 megawatts in Germany alone by 2020, thus more than doubling the current figure.
Expanding renewable energies and climate-friendly electricity generation from fossil energy sources are closely linked at EnBW. We do not think in the categories of “small” versus “large” or “centralised” versus “local”. Rather, the motto should be: purposeful, regenerative, low carbon and viable,” says Villis. EnBW is convinced that Germany will continue to need flexible large-scale power stations capable of providing base load in the future.
Investment in highly efficient and flexible gas power stations forms the backbone of the new energy concept
Flexible gas power stations with rapid response times will similarly play a role in this respect. For this reason, EnBW also approved the construction of a highly efficient gas and steam turbine power station within the scope of its majority shareholding in Stadtwerke Düsseldorf AG. It is scheduled to generate environmentally friendly electricity and district heating as of 2016. EnBW is thus not only investing in the new energy concept but is also putting the necessary infrastructure in place.
2011 results impacted by expenses
In the past fiscal year, EnBW increased its unit sales of electricity by 6% in comparison to the prior year to 155.7 billion kilowatt-hours and also significantly increased its external revenue by 7.3% to € 18,789.7 million. Adjusted EBIT (earnings before interest and taxes) fell by 17% in 2011 to € 1,598.1 million partly on account of the considerable expenses caused by the new energy concept.
The resulting adjusted group net profit in terms of the loss/profit shares attributable to the equity holders of EnBW Energie Baden-Württemberg AG fell by 32.8% from € 964.3 million in the prior year to € 647.7 million in the reporting year.
The group net loss for 2011 in terms of the loss/profit shares attributable to the equity holders of EnBW Energie Baden-Württemberg AG amounted to € -867.3 million. In the prior year, EnBW had generated a group net profit of € 1,157.2 million.