EQS-News: VERBUND AG: 2024 annual results: high earnings despite a decline

The 2024 financial year turned out to be challenging, unpredictable and highly volatile in every respect for the energy market. Geopolitical events in particular, especially the war in Ukraine and the associated impacts on European gas prices, but also the weakening economy in Europe, had a massive impact on European wholesale electricity prices, which are a key driver of the Group’s business performance. Furthermore, the landmark elections in the European Union, some EU member states, the United States and most recently in Austria also sparked intense debate about the future course of the regulatory and political framework in the energy sector. The outcome of the elections in the United States in particular, which could bring a renewed focus on promoting gas and expanding nuclear power, as well as growing realism about the spiralling costs of the energy transition and how they will be financed and apportioned in Europe, has led to a lack of predictable long-term framework conditions. Such predictability is, however, a prerequisite for investing long-term in tomorrow’s energy. These developments have made it clear that striking a balance between security of supply, climate action and competitiveness on the one hand and the threat of deindustrialisation in Europe on the other remains a challenge. Against this backdrop, we at VERBUND are consistently focusing on advancing our strategic goals and are proud to have achieved some major successes in financial year 2024, especially in such a challenging environment.

Results for 2024

Following extraordinarily high earnings in financial year 2023 due to the gas price shock immediately after the outbreak of the Russia-Ukraine conflict, earnings declined in financial year 2024 due to lower wholesale prices. EBITDA fell by 22.5% year-on-year to €3,480.3m. The Group result was down 17.2% to €1,875.3m, and the Group result after adjustment for non-recurring effects declined by 24.5% year-on-year to €1,975.5m. The water supply, which was well above average, had a positive effect on earnings. The hydro coefficient for the run-of-river power plants came to 1.09, or 11 percentage points above the prior-year figure and 9 percentage points above the long-term average. Earnings were hard-hit by the sharp drop in futures prices for wholesale electricity that were relevant for the reporting period. Spot market prices also declined in financial year 2024. The average sales price achieved by VERBUND for its own generation from hydropower thus fell by €49.1/MWh to €118.0/MWh. Despite higher generation from photovoltaic installations and wind power plants, the earnings contribution from the New renewables segment also declined due to lower sales prices. By contrast, a significantly improved earnings contribution from the Sales segment compared with 2023 had a positive effect, partly due to lower procurement costs, while the contribution from the Grid segment suffered due to a drop in earnings at Gas Connect Austria GmbH and Austrian Power Grid AG.

Dividend

An ordinary dividend of €2.80 per share for financial year 2024 will be proposed to the Annual General Meeting on 29 April 2025. Distribution of the dividend requires the approval of the shareholders of VERBUND AG at the 2025 Annual General Meeting.

Forecast for 2025

Based on expectations of average levels of own generation from hydropower, wind power and solar power as well as the opportunities and risks identified, VERBUND expects EBITDA of between around €2,700m and €3,300m and a Group result of between around €1,350m and €1,750m in financial year 2025. VERBUND’s planned payout ratio for financial year 2025 is between 45% and 55% of the Group result of between around €1,350m and €1,750m, after adjusting for non-recurring effects. The earnings forecast is contingent on the Group not being impacted by any further legal or regulatory changes.

Extension and amendment of the Federal Act on the Electricity Energy Crisis Contribution

The Electricity Energy Crisis Contribution (EKB-S) came into effect at the end of 2022. The Federal Act on the Electricity Energy Crisis Contribution (Bundesgesetz über den Energiekrisenbeitrag-Strom) remains in force and, according to the current version, the most recent EKB-S collection period came to an end on 31 December 2024. Along with the revision of various parameters, the act has now been extended for five additional collection periods from 1 April to 30 March of the following year for the years 2025 to 2030. In principle, the act sets a cap of €90/MWh on electricity revenue generated by existing plants and €100/MWh for new plants (commissioned from 1 April 2025). Exemptions apply, among other things, for pumped storage facilities. Revenues above the price cap are levied at 95%. The monthly excess revenues accrued between 1 April 2025 and 31 March 2030 will be subject to the levy.

Based on current information and depending on the development of electricity prices, the hydro and new renewables coefficients and the deduction of investments, VERBUND expects windfall tax in the range of €50m to €100m to be levied for financial year 2025. This amount is covered by the above outlook for financial year 2025.

 

KPIs	Unit	2023	2024	Change
Revenue*	€m	10,449.5	8,224.6	−21.1%
EBITDA	€m	4,490.5	3,480.3	−22.5%
Operating result	€m	3,501.9	2,726.0	−22.2%
Group result	€m	2,266.1	1,875.3	−17.2%
Earnings per share	€	6.52	5.40	−17.2%
EBIT margin*	%	33.5	33.1	–
EBITDA margin*	%	43.0	42.2	–
Cash flow from operating activities*	€m	5,083.0	3,248.6	−36.1%
Free cash flow before dividends*	€m	3,651.6	2,078.8	−43.1%
Free cash flow after dividends	€m	2,098.1	144.8	−93.1%
Net debt/EBITDA	X	0.4	0.6	–
Performance of VERBUND shares	%	6.9	−16.7	–
(Proposed) dividend per share	€	3.40	2.80	−17.6%
(Proposed) special dividend per share	€	0.75	–	–
Share of generation from renewables	%	97.8	96.4	−1.5%
Specific GHG emissions (Scope 1/total electricity generated)**	g CO2e/kWh	7.9	13.0	+64.6%

* calculation adjusted retrospectively in financial year 2021 in accordance with IAS 8, with effect from 1 January 2020

** from electricity generation and transmission (excluding GCA) as a percentage of total electricity generated (including purchase rights, excluding electricity generated for district heating). Preliminary figures before ETS audit

 

Additional information on VERBUND’s non-financial KPIs can be found in the Integrated Annual Report 2024, available on the VERBUND website at www.verbund.com > About VERBUND > Investor Relations > Latest financial results.

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-relations@verbund.com