Ad hoc announcement VERBUND AG / Keyword(s): Half Year Results/Interim Report VERBUND AG: result for quarters 1-2/2014: Prices, water supply and expenses for the restructuring of the thermal portfolio weigh on result Ad hoc announcement transmitted by DGAP – a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. ------------------------------------------------------------------------------ The dramatic transformation of the European electricity markets is still ongoing. Profitability of conventional generation facilities in Europe is rapidly declining. The situation of gas power plants is a particularly precarious one. In May, VERBUND approved the restructuring of thermal generation. This includes the temporary decommissioning of the combined cycle gas turbine power plants in Mellach, Austria, as well as in Pont-sur-Sambre and Toul in France. In addition, the Dürnrohr hard coal power plant and the Neudorf/Werndorf oil-fired district heating plant will be closed. Despite the measures that have been introduced, the results are showing a decline. EBITDA fell to EUR354.8m, and the Group result fell to EUR56.6m. The sharp decrease is primarily attributable to the considerable, positive non-recurring effects in 2013 resulting from the asset swap with E.ON. But even adjusted for these non-recurring effects, results are lower. Adjusted EBITDA declined by 33.4% to EUR421.0m, and the Group result fell by 60.7% to EUR93.6m. There are three main reasons for this: substantially lower hydropower generation due to lower water supply, the even lower wholesale prices for electricity as well as non-recurring expenses for thermal power plants. Based on average own generation from hydropower in the second half of the year, our expectations now are for EBITDA to be approximately EUR690m and the Group result to be approximately EUR70m for financial year 2014. The planned payout ratio for 2014 remains at approximately 50% of the Group result of approximately EUR150m after adjustment for non-recurring effects. Key figures Unit Q1-2/2013 Q1-2/2014 Change Revenue EURm 1,648.3 1,398.8 -15.1% EBITDA EURm 806.2 354.8 -56.0% Operating result EURm -78.7 196.7 - Group result EURm 406.4 56.6 -86.1% Earnings per share EUR 1.17 0.16 -86.1% EBIT margin % -4.8 14.1 - EBITDA margin % 48.9 25.4 - Cash flow from operating activities EURm 483.7 345.0 -28.7% Free cash flow EURm 483.9 -322.8 - Gearing % 73.8 78.2 - Since 1 January 2014, IFRS 11 "Joint Arrangements" has replaced the previous rules under IAS 31 "Interests in Joint Ventures". As a result of the new rules, the interest in Ennskraftwerke Aktiengesellschaft is to be classified as a joint operation. Thus, previously reported figures have been adjusted. Although the result attributable to the French combined cycle gas turbine power plants is to be presented separately from continuing operations in accordance with IFRS 5, to enhance comparability, the key figures relate to the combined result from the Group's continuing and discontinued operations. Further information as well as the interim report for quarters 1-2/2014 can be found at www.verbund.com > Investor Relations > Current financial result. Contact: Andreas Wollein Head of Group Finance and Investor Relations T.: +43 (0)5 03 13 - 52604 F.: +43 (0)5 03 13 - 52694 mailto:investor@verbund.com 30.07.2014 The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------------- Language: English Company: VERBUND AG Am Hof 6A 1010 Wien Austria Phone: 0043-1-53113-52616 Fax: 0043-1-53113-52694 E-mail: investor@verbund.com Internet: www.verbund.com ISIN: AT0000746409 WKN: 877738 Indices: ATX Listed: Wien (Amtlicher Handel / Official Market) End of Announcement DGAP News-Service ---------------------------------------------------------------------------