08. March 2013| MVV Energie

MVV Energie in favour of "evolution not revolution"

In the conversion in the energy supply along ecological lines, the Mannheim energy company favours consistent, targeted implementation - Good progress with investments in expanding renewable energies and energy efficiency - Forecast for current financial year confirmed

In the conversion now underway in the energy supply, the Mannheim-based energy group MVV Energie has called for consistent, targeted implementation and the avoidance of erratic, radical system changes. "People's acceptance and the trust placed in the process by business should not be overstretched", stressed Dr. Georg Müller, CEO of the SDAX-listed group of companies, at this year's Annual General Meeting held in the Rosengarten Congress Center in Mannheim. "Our guiding principle is therefore evolution rather than revolution. Driven by passion, but retaining a sense of proportion, in all of the necessary changes Germany must also keep an eye on supply reliability, environmental compatibility and affordable prices."

This principle was particularly relevant to the forthcoming reform of the German Renewable Energies Act (EEG), which according to the MVV boss had been a "successful model". Without the EEG, it would not have been possible to increase the share of renewable energies to more than 20 percent in recent years. "Now we need an EEG 2.0", said Dr. Müller to the 1,200 shareholders and guests at the AGM. It was a question of acting in line with the "evolution not revolution" principle and gradually enhancing existing EEG legislation to create greater competition and cut costs. Here, Dr. Müller spoke out in favour of extending direct marketing and reducing the number of EEG allocation exemptions.

At the same time, Dr. Müller warned against overly hasty political reactions. The discussions surrounding the retrospective reduction in compensation commitments currently proposed by parts of the Federal Government sent out a disastrous signal. "Confidence in the reliability of the political framework has plummeted to a new low." Fixed reductions in compensation threatened to slow down the further expansion required in onshore wind power. "The cuts would affect precisely those areas where compensation would be most desirable from an overall perspective," remarked Dr. Müller.

According to the MVV CEO, the company's earnings for the past 2011/12 financial year (1 October 2011 ¿ 30 September 2012) were thoroughly satisfactory. The company had boosted its sales by 8 percent from Euro 3.6 billion to Euro 3.9 billion. Adjusted operating earnings (adjusted EBIT) amounted to Euro 223 million, thus slightly exceeding the company's own forecast. Commented Dr. Müller: "With our forward-looking strategy, we are on the right course to master the great challenges ahead and to exploit the entrepreneurial opportunities offered by the system change." The company simultaneously confirmed its expectation for the current 2012/13 financial year that, given persistently difficult conditions on the energy market, sales would increase slightly but adjusted EBIT would fall around 5 percent short of the previous year's figure. Against this backdrop, the Supervisory and Executive Boards proposed an unchanged dividend of 90 cents per share for approval by the Annual General Meeting. The distribution total would thus once again amount to Euro 59.3 million.

The Group is still making good progress in implementing its ambitious investment targets. By 2020, MVV Energie intends to invest three billion euros in expanding renewable energies, energy efficiency, cogeneration and environmentally-friendly district heating, as well as in maintaining its existing plants and grids. Just over three years after announcing this long-term, sustainable growth programme, the Group has already implemented or reached binding decisions concerning around Euro 1.9 billion, or almost two thirds of the planned investment total. Commented Dr. Müller: "We acted early to set course for the transformation in the energy system along ecological lines and are maintaining a consistently high pace."

MVV's CEO sees the conversion in the energy system now underway as irreversible. Any wish to reverse the process would also be "a macroeconomic mistake". However, it was necessary to establish a clear and above all reliable framework with a stable consensus within society.

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