08.08.2018 - 07:30

DGAP-News: E.ON SE: E.ON increases first-half earnings and affirms forecast

DGAP-News: E.ON SE / Key word(s): Half Year Results

E.ON SE: E.ON increases first-half earnings and affirms forecast

08.08.2018 / 07:30

The issuer is solely responsible for the content of this announcement.

E.ON increases first-half earnings and affirms forecast

  • Forecast for 2018 adjusted EBIT and adjusted net income affirmed

    First-half adjusted EBIT 10 percent above prior-year figure, adjusted net income up 19 percent

  • Economic net debt reduced further

  • Important milestones reached in transaction with RWE

E.ON delivered good results for the first half of 2018. Adjusted EBIT in the company's core business of EUR1.7 billion was 10 percent above the weak prior-year figure (EUR1.6 billion). Adjusted EBIT for the E.ON Group as a whole likewise rose by 10 percent to EUR1.9 billion (prior year: EUR1.8 billion). Adjusted net income of EUR1,052 million surpassed the prior-year figure of EUR881 million by EUR171 million, or 19 percent.

Forecast for 2018 financial year affirmed

At the presentation of E.ON's Interim Report for the first half of 2018 in Essen, E.ON CFO Marc Spieker affirmed the company's forecast for the 2018 financial year: "Our core business - Energy Networks, Customer Solutions, and Renewables - delivered good results, even though we continue to face fierce competition, primarily in our customer solutions business. We're meeting these challenges with new products, new solutions, and even better, more efficient processes, particularly for our customers. All the key figures and developments for the entire Group are in line with our plan, and we therefore affirm our forecast for full-year 2018."

E.ON continues to expect the Group's full-year adjusted EBIT to be between EUR2.8 and EUR3 billion and its full-year adjusted net income to be between EUR1.3 and EUR1.5 billion.

Good performance in core business

The Customer Solutions segment in particular contributed to E.ON's good first-half earnings performance. E.ON enlarged its customer base relative to the prior year by approximately 100,000 household customers. Customer Solutions' sales of EUR11.5 billion were slightly above the prior-year figure of EUR11.2 billion. Its adjusted EBIT rose by 8 percent year on year, from EUR440 million to EUR477 million.

The Energy Networks segment again generated more than half of the E.ON Group's earnings. Its sales of EUR6.1 billion were 30 percent below the prior-year level of EUR8.6 billion. This is only attributable to a technical effect resulting from the application of a new International Financial Reporting Standard. Starting this financial year, renewables subsidies and other levies that are passed through are netted out in the income statement, which reduces both sales and costs of materials. Earnings from operations remain unaffected. Energy Networks' adjusted EBIT of EUR1,070 million was roughly at the prior-year level of EUR1,087 million. A special item in the low double-digit million range partially offset an anticipated decline in earnings due to regulatory reasons. However, E.ON expects this segment's earnings to decline somewhat more significantly as the year goes forward. This has already been factored into the company's forecast for full-year 2018.

Sales at the Renewables segment rose from EUR710 million to EUR741 million, primarily because of higher output due to the commissioning of new offshore and onshore wind farms. This segment's earnings increased by 15 percent, from EUR205 million to EUR236 million.

Earnings at Non-Core Business, which consists of PreussenElektra and the generation business in Turkey, totaled EUR224 million, 9 percent above the prior-year figure of EUR205 million.

Good operating results yield strong cash flow

E.ON's operating cash flow of EUR1.4 billion was EUR3.5 billion lower than in the prior-year period, mainly because of an exceptionally significant one-off item, the roughly EUR2.85 billion refund of the nuclear-fuel tax the company received in June 2017.

Debt reduced further

Compared with the figure at year-end 2017 (EUR19.2 billion), E.ON reduced its economic net debt by EUR3.4 billion, or 18 percent, to roughly EUR15.9 billion. This positive development is principally attributable to the proceeds from the sale of the company's Uniper stake and gas network in Hamburg. "We'll use this balance-sheet flexibility to implement the transaction we agreed on with RWE in March. When it closes, it will create a new E.ON and an even more powerful company, a company focusing on smart grids and innovative customer solutions and fully dedicated to serving its customers," Spieker said.

Important milestones reached in transaction with RWE

Since announcing the transaction with RWE in March 2018, E.ON has already reached important milestones toward implementation. Together with RWE and innogy and in consultation with the Group Works Councils, in May E.ON reached a collective-bargaining Agreement in Principle with ver.di and IGBCE. This was followed in July by a Framework Agreement with the E.ON SE Works Council and Group Works Council. Both agreements establish reliability for all employees on the road toward the new E.ON. In July E.ON also reached an agreement with innogy to work together constructively, to the degree permitted by law, in preparing for the integration. In late July E.ON successfully completed its voluntary public takeover offer to innogy's minority shareholders. Through the end of the extended offer period, about 9.4 percent of innogy stock was tendered to E.ON. Together with the 76.8-percent stake from RWE, this equals 86.2 percent of innogy's share capital. "The agreed-on acquisition of RWE's majority stake alone would've enabled us to integrate innogy into E.ON," Spieker said. "We're therefore very satisfied with the outcome of our voluntary public takeover offer and are pleased that many other innogy shareholders accepted our offer. Numerous options are available to us for the legal aspects of the integration after closing. We're now focusing on the preparations for this integration and a swift antitrust approvals process."

This press release may contain forward-looking statements based on current assumptions and forecasts made by E.ON Group Management and other information currently available to E.ON. Various known and unknown risks, uncertainties, and other factors could lead to material differences between the actual future results, financial situation, development, or performance of the company and the estimates given here. E.ON SE does not intend, and does not assume any liability whatsoever, to update these forward-looking statements or to conform them to future events or developments.


08.08.2018 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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Language: English
Company: E.ON SE

Brüsseler Platz 1

45131 Essen

Phone: +49 (0)201-184 00
E-mail: info@eon.com
Internet: www.eon.com
Indices: DAX, EURO STOXX 50
Listed: Regulated Market in Berlin, Dusseldorf, Frankfurt (Prime Standard), Hamburg, Hanover, Munich, Stuttgart; Regulated Unofficial Market in Tradegate Exchange

End of News DGAP News Service

711899  08.08.2018 


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