Karlsruhe. Pursuant to International Accounting Standards (IAS 36) EnBW is obliged to perform impairment tests both regularly and in the occurrence of certain events. During the preparation of the 2014 half-year financial statement, EnBW has identified the need to recognise additional impairment of about EUR 1.2 billion at the Group level on the power plant complex. Moreover, pursuant to IAS 37, the provisions for anticipated losses on no longer cost-covering power purchase agreements must be raised by about EUR 0.3 billion. EnBW will present the 2014 half-year financial statement to the public on 1 August 2014.
The reason for the extraordinary charges totalling EUR 1.5 billion, which are to be included in the consolidated financial statement of 30 June 2014, lies in considerably worsening expectations regarding long-term electricity price developments, particularly from today’s perspective and based on comprehensive market analyses. The futures market prices have continuously plummeted since the second six-month period 2012, from about EUR 50/MWh to under EUR 40/MWh during 2013, and in the course of 2014 to by now less than EUR 35/MWh. In the estimate of EnBW, an improvement of the market situation is not to be expected in the medium term. Therefore it is to be assumed that the electricity price level will continue to be low over the next few years, which will significantly lower the potential future earnings from EnBW’s generation capacity, specifically from coal-fired power stations. This necessitates a value adjustment in the amount stated above.
The extraordinary charges will reduce the non-operating result and therefore will have no effect on the operating result (adjusted EBITDA). Consequently, they will neither have an impact on cash nor have an effect on the dividend calculation basis. Calculation of the dividend is based on the Group profit adjusted for extraordinary factors.
The extraordinary expenses will also have a negative effect on the statutory annual financial statement of EnBW AG. The precise extent of the effects, which will not jeopardise the distribution of dividends for the 2014 financial year, is yet to be determined.
In June 2013 and April 2014 EnBW had already applied to the Federal Network Agency for permission to shut down individual older block-unit power stations which no longer have any prospects of being profitable even on the basis of the previous assumptions regarding the market development. This concerned the block-unit power stations in Walheim and Marbach as well as blocks 5 and 6 in Heilbronn.