15. August 2019| MVV Energie

MVV calls for end to wind power approval backlog

Mannheim energy company views further expansion in renewable energies as prerequisite for effective climate protection – MVV’s own investment tempo remains high – Forecast confirmed: Slight decrease in earnings in current 2019 financial year

According to the Mannheim-based energy company MVV (ISIN: DE000A0H52F; WKN: A0H52F), the only way to ensure the further expansion of renewable energies as a precondition for effective climate protection is by rapidly addressing the current backlog in approvals for onshore wind power projects. “The clear commitment shown by politicians to climate protection and their own expansion targets for renewable energies now has to be backed up by specific measures on all levels to lend fresh momentum to the floundering expansion process”, stressed Dr. Georg Müller, CEO of MVV, when presenting the company’s results for the first nine months of its current 2019 financial year (1 October 2018 – 30 June 2019) in Mannheim on Thursday.

MVV’s CEO sees climate and energy policy as one of the key tasks facing our generation as we look ahead. “At MVV, climate protection has long formed a key focus of our strategic alignment.” The first milestone for expanding renewable energies in Germany was now 65 percent by 2030, given that the country had missed its climate protection targets for 2020.

Onshore wind power had a particularly important role to play, but its expansion had currently been brought to a halt by protracted approval processes. Dr. Müller spoke out in favour of sustainably reducing approval times by providing the relevant authorities with adequate human and technical resources and complying with approval deadlines. Not only that, simplified processes were needed to approve projects in those regions already designated as priority areas. Moreover, each federal state should make at least two percent of its surface available. Exemptions were also needed to enable repowering projects to be implemented even in cases where moratoriums were in effect.

At the same time, politicians should avoid creating new hurdles by introducing stricter proximity rules and needed to defuse the conflict between wind power and air traffic. Finally, greater legal certainty was required for current approvals and those already granted. Adds Dr. Müller: “Onshore wind power is the motor of renewable energies. If it stalls, we need to get it started again. After all, we cannot just exit from technologies, we also have to decide which technologies to invest in.”

According to Dr. Müller, MVV’s performance in the first nine months of the 2019 financial year showed that “we are actively facing this task and consistently investing in renewable energies, in energy efficiency and in sustainable products and services that enable our customers to make their own very specific contributions to the energy turnaround.” Consistent with this, operating earnings in “New Energies”, the reporting segment in which MVV pools its renewable energies and environmentally-friendly waste treatment activities, rose by around 14 percent to Euro 75 million.

One key driver here is the project development business. Between October 2018 and June 2019, the group of companies with its Juwi and Windwärts subsidiaries linked up renewable energies plants with capacities of 341 megawatts to the grid in its national and international businesses.

Overall, adjusted EBIT for the first nine months of the 2019 financial year came to Euro 207 million and thus fell 11 percent short of the previous year’s figure. In the 3rd quarter, MVV further reduced the shortfall to the previous year’s figure, which had benefited from positive one-off items resulting from sales proceeds in the “Customer Solutions” and “Supply Reliability” reporting segments. It managed this even though earnings for the current year were additionally held back by follow-up costs incurred for the joint power plant in Kiel (GKK) decommissioned at the beginning of April and by turbine damage at the biomass power plant at Ridham Dock in the UK. Sales decreased by around 6 percent to Euro 2.8 billion, a development largely due to an amendment in the accounting policies applied under International Financial Reporting Standards (IFRS).

For the 2019 financial year has a whole, MVV has confirmed its most recent forecast. Accordingly, after four years of earnings growth the company now expects both sales and operating earnings for the current year to fall slightly short of the previous year’s figures.

Remarks Dr. Müller: “As an innovative pioneer of the energy turnaround, we will actively seize the opportunities involved in the conversion of our energy supply in future as well. This way, we intend to strengthen our business and generate further sustainable growth.” For this, politicians would also have to create the framework needed to enable climate targets to be reached.

The complete quarterly statement is available online at www.mvv.de/investors .

MVV in Figures
       
  1 Oct 2018
to 30 Jun 2019
1 Oct 2017
to 30 Jun 2018
% change
       
 
Sales excluding energy taxes (Euro million) 2,782 2,966 - 6
Adjusted EBITDA1 (Euro million) 344 389 - 12
Adjusted EBIT1 (Euro million) 207 232 - 11
       
Adjusted net income for period 1 (Euro million) 119 130 - 8
Adjusted net income for period after minority interests1 (Euro million) 97 109 - 11
Adjusted earnings per share 1 (Euro) 1.47 1.66 - 11
 
Cash flow from operating activities (Euro million) 1 212 - 100
Cash flow from operating activities per share (Euro) 0.02 3.22 - 99
 
Adjusted total assets at 30 Jun 2019 / 30 Sep 20182 (Euro million) 4,464 4,152 + 8
Adjusted equity at 30 Jun 2019 / 30 Sep 20182 (Euro million) 1,561 1,550 + 1
Adjusted equity ratio at 30 Jun 2019 / 30 Sep 20182 (%) 35.0 37.3 - 6
Net financial debt at 30 Jun 2019 / 30 Sep 2018 (Euro million) 1,471 1,075 + 37
 
Investments (Euro million) 203 214 - 5
of which growth investments 126 101 + 25
of which investments in existing business 77 113 - 32
 
Number of employees at 30 Jun 2019 / 30 Jun 2018 6,122 5,949 + 3
1  Excluding non-operating measurement item for financial derivatives, excluding structural adjustment for part-time early retirement and including interest income from finance leases
2  Excluding non-operating measurement item for financial derivatives

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