Vattenfall Q1 results 2011

Transcription

1 Vattenfall Q1 results 2011 Øystein Løseth, CEO and Dag Andresen, CFO Press conference, 5 May 2011

2 Fukushima accident in Japan consequences for nuclear Earth quake and tsunami in Japan and accident in the nuclear power plant Fukushima have led to discussion about the future of nuclear power EU is going to conduct stress-tests for all European nuclear power plants GERMANY: Government ordered the closure of seven reactors, commissioned prior to 1980 Moratorium of three months on extending operating licenses, including a security check of all nuclear power plants Ethic-panel to prepare government s decision on the future of nuclear in Germany decision expected in June Assessment about potential financial consequences has to be made after decision

3 Timeline nuclear power plants in Germany Activity Mar Apr May Jun Jul Aug May 2012 Fukushima Shutdown of 7 German Nuclear reactors Moratorium Questions RSK* Final report RSK Stress tests EU Ethic - panel Government decision Meeting Angela Merkel/ Presidents Bundesländer Bundesrat: Decision on Moratorium *) Reaktor Sicherheits - Kommission

4 Nuclear Update: High availability in Swedish nuclear plants Vattenfall s Swedish nuclear power plants Forsmark and Ringhals had availability close to 100%. Vattenfall s German nuclear plants, Brunsbüttel and Krümmel, continuously out of operation during Q1, Estimated earnings impact (loss of revenues) for nuclear standstills during Q amounted to: - German plants: SEK million (~EUR 133 million) SKB (Swedish Nuclear Fuel and Waste Management Company) submitted a formal application for a permit to build a final repository for nuclear waste in Sweden.

5 Discussion around renumeration issues Severance pay for former CEO led to changes in Board and EGM: Björn Savén new Chairman of the Board, Kerstin Ahlfont acting Head of HR in EGM High severance packages in Germany were the consequence of old contracts; those contracts are no longer made Vattenfall implements the guidelines for compensation for senior executives in state-owned companies from the Swedish government Process of reviewing all agreements with senior executives at Vattenfall (around 300) shall be finished till summer

6 Important events First turbine installed at Ormonde Offshore Wind Farm DanTysk Offshore Wind Farm: installation vessel contract signed InterConnector Norway UK Agreement with NGO s on Magnum project in the Netherlands Launch of Volvo V60 diesel plug-in hybrid in Geneva Biomass agreement with the State of Berlin Long-term contract on electricity with Stora Enso in Sweden signed One Tonne Life family moved in the house

7 Divestments Rostock hard coal-fired plant, 25 % share sold to RheinEnergie AG (1 February) Energieversorgung Sachsen Ost AG (ENSO), 21,3 % share sold to EnergieVerbund Dresden GmbH (EVD); 147 Mio Euro; approval of authorities of City of Dresden necessary (13 April) Vattenfall Power Consultants in Sweden, units with about 360 employees at 22 offices in Sweden, Norway and UK agreed to sell to Pöyry PLC (13 April) Evaluation of potential divestments in non-core markets ongoing; progress in the process, but no decisions taken yet

8 Satisfactory result in Q EBITDA, EBIT and Net Sales RoE and Profit after tax SEK bn 70 SEK bn 250 SEK bn 25 % Q110 Q Q111 0 EBITDA (LHS) EBIT (LHS) Net Sales (RHS) Profit after tax (LHS) 1) = Last twelve months RoE (RHS) Net sales decreased 26.6% mainly due to the divestment of 50Hertz Transmission GmbH in May EBITDA decreased 18.6% EBITDA adjusted for non-cash items decreased 7.6% EBIT increased 17.1% RoE improved to 12.6%, but still below target level of 15%. Excluding IAC RoE was 15.9%

9 Reduced debt levels and improved credit metrics SEK bn Debt development Key credit metrics FY 2009 FY 2010 Q1/ Gross Debt Net Debt 31-m ar jun sep dec m ar-11 FFO Interest cover (x) FFO/net debt (%) FFO/adj. net debt(%) Adj.net debt/ EBITDA (x) ) Last twelve months 2) Adj.net debt/adjusted EBITDA: Q1/11: 2.5 (x) 7.5 1) ) ) 3.0 1) Debt reduction mainly due to stronger Swedish krona. Stronger credit metrics.

10 Higher electricity prices Nordic 11% higher average Nordic spot prices (system price) (Q1-11 vs.q1-10). - Average Swedish area prices for Q were 8.7% lower. - The hydrological balance recovered from -43 TWh to -24 TWh in the first quarter Germany, Netherlands 26% higher average spot prices in Germany and 28% higher average spot prices in the Netherlands (Q1-11 vs. Q1-10). Future prices increased. Monthly Spot Average Daily Future Closing Prices EUR/M Wh jan-07 apr-07 jul-07 okt -07 jan-08 apr-08 jul-08 okt -08 jan-09 apr-09 jul-09 okt -09 jan-10 apr-10 jul-10 okt -10 jan-11 apr-11 EUR/ MWh NordPool EPEX APX PolPX jan-08 apr-08 jul-08 okt -08 jan-09 apr-09 jul-09 okt -09 jan-10 apr-10 jul-10 okt -10 jan-11 apr-11 NP 13 EEX 13 APX 13 NP 12 EEX 12 APX 12

11 Higher electricity generation, +4.6% Q Nuclear power increased 37.7% - Almost 100% availability of Vattenfall s Swedish nuclear power plants. TWh Hydro power decreased 14.7% Fossil power decreased 3.1% Wind, biomass & waste increased 55% to 1.4 TWh. - Wind power increased 125% to 0.9 TWh mainly due to the commissioning in H of the 300 MW Thanet offshore wind farm in the UK and the 78 MW Stor-Rotliden onshore wind farm in Sweden Hydro Nuclear Fossil Wind & Other Q1 2011: 49.8 TWh Q1 2010: 47.6 TWh

12 Financials Dag Andresen, CFO

13 Q Financial highlights SEK million Q Q Change (%) Net Sales 51,868 70, EBITDA 16,932 20, EBIT 11,842 10, EBIT excl. IAC* 11,153 15, Profit after tax 7,203 3, Profit after tax excl. IAC* 6,714 9, FFO 15,053 9, Cash flow from operating activities 7,607 2, Cash flow before financing activities 2,656-6,497 - *IAC = Items affecting comparability

14 EBIT development Q In SEK billion Q Electricity price Electricity volume O&M, S&A Fees and taxes Capital gains/losses Other IAS 39 50Hertz Transmission Gm bh Q1 2011

15 EBIT, Q by Operating Segment in SEK million Q Q Change FY 2010 Generation 7,510 12,024-4,514 30,388 Distribution and Sales 4,791 3,780 1,011 8,340 Renewables ,620 Other ,557 4,918-7,255 Total 11,842 10,115 1,727 29,853 1) Mainly include Treasury operations and Other group functions.

16 Hedging position and prices as of 31 March 2011 % hedged of forecasted electricity generation Nordic region Continental Europe EUR/MWh Nordic region Continental Europe

17 Updated Capex plan fuel split Well diversified fuel split Trisection of the investments 165 Total Investments Distribution Heat grids Gas storage IT "No fuel" investments 123 Wind 26 Investments allocated to a fuel type Nuclear 20 Hydro 7 Bio 4 Coal, CCS 4 Gas, BFG 29 Hard coal 16 Lignite 17 No fuel investments El.-distribution Heat grids Storages IT Sales 42 (25%) total: (36%) Investments in CO 2 free production Hydro Wind Bio Nuclear CCS-demo Investments allocated to electricity and heat production causing CO 2 emissions Lignite Hard coal 64 (38%) 51 (25%) 50 (25%) Gas Mining For comparison: Plan total: (50%) The capex portion for CO 2 -free production is rising compared to the previous plan.

18 Financial targets and outcome Key Ratio Targets Q Return on Equity (RoE) 15% on average equity 12.6% % excl. IAC 1 Cash flow interest coverage after maintenance investments times Credit rating Single A category rating Moody s: A2, stable outlook S&P: A, negative outlook Dividend pay-out 1) Last twelve months 40-60% 50% 2 (SEK 6.5 bn paid out 3 May 2011)

19 Questions & Answers