MVV posts strong half-year
Sales and earnings growth at Mannheim energy company – Half-year operating earnings up 16 percent to Euro 223 million – Full-year outlook raised – MVV CEO Dr. Müller: "Our clear course towards climate neutrality is also paying off financially."
“A strong half-year” – those are the words used by Dr. Georg Müller, CEO of the Mannheim-based energy company MVV (ISIN: DE000A0H52F5; WKN: A0H52F), to summarise the first six months of the current 2021 financial year. Presenting the half-year results (1 October 2020 – 31 March 2021) in Mannheim on Wednesday, he stressed that the clear course pursued by the group of companies towards climate neutrality was “also increasingly paying off financially”. MVV managed to increase its operating earnings (adjusted EBIT) by 16 percent to Euro 223 million. Sales for the same period rose by 4 percent to around Euro 2.1 billion. Based on the pleasing business performance in the year to date and the current assessment of the further potential implications of the coronavirus pandemic, the company also raised its full-year outlook for the 2021 financial year. From an operating perspective, MVV now expects significant year-on-year operating earnings growth – in the 2020 financial year the company reported adjusted EBIT of Euro 233 million – and a moderate increase in its sales (2020: Euro 3.5 billion), provided that no coronavirus-related setbacks arise with implications for MVV.
According to Dr. Müller, the company can report year-on-year improvements in earnings in all of its operating segments. “We achieved this despite the coronavirus pandemic and associated restrictions, as well as delays in individual projects. That offers sustainable proof for the connection between our strategic focus on climate protection and the energy turnaround on the one hand and our company’s profitable and forward-looking growth on the other. High supply reliability and an unrelenting focus on our customers are also paramount for us.”
Overall, net income for the period after minority interests rose by 19 percent from Euro 95 million to Euro 113 million. That corresponds to earnings per share of Euro 1.71, as against Euro 1.45 in the same period in the previous year. According to company figures, all operating reporting segments played their part in generating these strong earnings, which also contributed to a positive development in the cash flow. Alongside several one-off items, such as the first-time consolidation after the complete takeover of Fernwärme Rhein-Neckar GmbH (FRN), MVV referred in particular to earnings contributions received from the gas-fired CHP plant in Kiel, which launched operations at the end of 2019, as well as to the internationally successful renewable energies project development business. By contrast, the impact on operating earnings of colder winter weather compared with the previous year was largely offset by lower wind volumes, which reduced the volume of electricity generated at renewable plants.
On course for green heat
“We will be maintaining great tempo as we head for climate neutrality”, emphasised Dr. Müller looking ahead. As a pioneer of the energy turnaround, MVV had adopted a sustainable strategy at a very early stage. “We have consistently invested for years now in expanding renewable energies, energy efficiency and innovative business models.” Alongside the electricity sector, the group of companies has a particular focus on green heat: “Today, around 30 percent of our district heating for Mannheim and the region already comes from climate-neutral sources. In the years ahead, we will make further consistent progress on this course and draw on renewable energies from the region.” The company’s successful strategy is also reflected in its personnel totals. Over the past twelve months, the Group’s workforce grew by around 150 to more than 6,300 employees most recently.
Further expansion in renewable energies
The renewable energies project development business reported a very positive performance in the past six months. Development was concluded on solar plants and wind turbines with total capacities of 263 megawatts, 74 percent more than in the same period in the previous year. The capacities of renewable energy plants for which the group of companies has assumed operations management increased by 9 percent to 3,757 megawatts. The MVV Group also took a major step forward with its proprietary renewable energies electricity generation portfolio: Having taken over four windfarms developed by the Juwi and Windwärts subsidiaries in Hesse, Schleswig-Holstein and Mecklenburg-Western Pomerania, the Group has now raised its capacities to more than 540 megawatts.
Federal Constitutional Court boosts climate protection
MVV believes that the ruling issued by the Federal Constitutional Court at the end of April, in which the court assessed the German Climate Protection Act adopted in 2019 as being inadequate and obliged lawmakers to set more binding targets for reducing greenhouse cases, will provide additional momentum for the company’s course towards climate neutrality. Comments Dr. Müller: “Above all, this ruling offers an opportunity to adopt energy policies with a longer-term focus.” It called on politicians to provide greater momentum and put relevant conditions in place for all sectors. “If we are to meet the targets set in the Paris Climate Accord, we will have to significantly speed up the renewable energies expansion: more green electricity, more green heat.” For MVV, the 1.5 degree target is the guiding figure for all business fields at the group of companies.
The complete quarterly statement is available online at www.mvv.de/investors.