EQS-News

VERBUND AG: Results for quarter 1/2024: slightly lower earnings despite good water supply

EQS-News: VERBUND AG / Key word(s): Quarter Results VERBUND AG: Results for quarter 1/2024: slightly lower earnings despite good water supply 08.05.2024 / 07:58 CET/CEST The issuer is solely responsible for the content of this announcement. Having posted the best result in its history last year, VERBUND can look back on an extremely successful 2023 and is starting 2024 strong, resilient and well-positioned. However, the energy market value drivers that are key to VERBUND’s earnings have deteriorated compared to the highs of 2022. The second half of 2023 saw another sharp fall in prices for emission allowances and gas, which have a knock-on effect on wholesale electricity prices. The marked decline in gas prices was driven by lower demand as a result of the mild winter, Europe’s somewhat sluggish economy and relatively high natural gas storage levels. Given these factors along with a lower anticipated earnings contribution from regulated grid operations, the earnings outlook for 2024 as a whole remains very healthy, but well below the results for 2023.

Despite the changes in the energy market environment, we are systematically forging ahead with our sustainable strategy 2030, which aims to strengthen our integrated positioning in the domestic market, expand new renewables electricity generation in Europe and develop a green hydrogen economy. Mission V, which we launched at the beginning of 2023, is our roadmap for mastering the challenges ahead and pushing on with the grid and energy transition.

VERBUND posted slightly lower quarter 1 results in 2024 due to a weaker energy market environment. EBITDA fell by 8.7% year-on-year to €883.4m. The Group result was down 4.3% to €506.0m. At 1.29, the hydro coefficient for the run-of-river power plants was 36 percentage points above the prior-year figure and 29 percentage points higher than the long-term average. By contrast, generation from annual storage power plants fell by 4.8% in quarter 1/2024 compared with the prior-year reporting period. Generation from hydropower thus increased by 1,804 GWh to 7,893 GWh. Earnings were hard-hit by the sharp drop in futures prices for wholesale electricity that were relevant for the reporting period. Spot market prices likewise retreated in quarter 1/2024. The average sales price achieved for own generation from hydropower fell by €84.7/MWh to €118.1/MWh. Despite higher generation from photovoltaic installations and wind power plants, particularly those that came on stream in Spain, the earnings contribution from the New renewables segment also declined slightly due to lower sales prices. A significantly higher earnings contribution in the Sales segment had a positive effect, partly due to lower procurement costs, while the contribution from the Grid segment suffered from a significant drop in earnings at Gas Connect Austria GmbH. Earnings were also reduced by a lower contribution from flexibility products.