1| VERBUND | Presentation VERBUND Vienna, 10.10.2008.

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1| VERBUND | Presentation VERBUND Vienna, 10.10.2008

Transcript of 1| VERBUND | Presentation VERBUND Vienna, 10.10.2008.

1 | VERBUND | Presentation

VERBUND

Vienna, 10.10.2008

2 | VERBUND HIGHLIGHTS

>most valuable listed company in Austria

>12.2 billion EUR market capitalization*

>116 power plants with 8,300 MW bottle

neck capacity and ~25,000 GWhstandard capacity

>~60,000 GWh trading volume and trading subsidiaries in 10 countries

>~4,000 GWh to end customers

>~3,400 km power grid route length

FINANCIAL KEY FACTS

2004 2005 2006 2007

Sales revenue mil.€ 1,712 2,134 2,878 3,038

EBIT mil.€ 386.0 527.0 806.5 916.1

Total Profit mil.€ 235.4 349.3 501.1 579.2

Operating CF mil.€ 438.5 680.5 753.9 807.6

Investing CF mil.€ -169.5 -83.2 -514.0 -646.6

EBIT Margin % 22.5 24.7 28.0 36.2

ROIC % 8.1 11.2 14.7 15.2

>SHAREHOLDING STRUCTURE

><24 %>Free float

>>25 %>Provincial power utilities

>51 %>Republic of Austria

*06/11/08

3 |

>Creation of an unique position as specialist for growth markets

>Establishment of a portfolio mix of existing and new projects to

accelerate the returns and to gain a steady P&L development

>Focus on business model “asset based trader” with priority on CO2 extensive technology

(hydro, gas, renewables)

>Foundation of Verbund International (VI) to dedicate management attention and resources

VERBUND REGIONAL FOCUS

Trading subsidiaries

4 |

Source www.teias.gov.tr

> total GDP equals two thirds of the total of EU-New Member States (per capita about half)> has one of the biggest and strongest growing populations and is one of the most important

growth markets in larger Europe> Foreign Direct Investment into Turkey has steadily increased over the last 5 years (pushed

up by privatizations and reform efforts in line with EU acquits preparation and Worldbank recommendations)

> Despite political hick-ups, Turkey has proven a stable regulatory and legal framework for foreign investors and is investment-friendly

Forward Prices Base (real 2007) in EUR/MWh

Source: Global Insight & Mercados & Pöyry

0.00

20.00

40.00

60.00

80.00

100.00

120.00

140.00

Germany

Turkey

SEE

1995-2005 CAGR: 6.5 %

2005-2020 CAGR: 7.8 %

Electricity Demand – Turkey (TWh)

TURKEY RATIONALE

5 |

Equity Stake:> 50 % stake (Partner Sabanci)

Targets:> 5,000 MW generation till 2015> 10 % market share (generation & sales)

Recent developments:> Winning bidder for Baskent EDAS

@ 1,225 bn USD> 1 bn EUR financing signed for the

construction of 2,000 MW of greenfield power plants

> 919 MW CCGT Bandirma ground breaking ceremony this month

> Over 600 MW HPP under construction(4 HPP)

> Licences for 69 MW wind, further 155 MW applied for

Çanakkale30 MW

Çanakkale65 MW

Gazipasa14 + 16 MW

Adana120 MW

Tufanbeyli450 MW

Mersin65 MWBirkapili

48 MW

Sucati7 MW

Hydro Power Plants

1000 MW

Bandirma919 MW

Bandirma24 MW

Kentsa120 MW

Mersin101 MW

Hydro

Thermal

Wind

TURKEY ENERJISA

6 |

> Dynamic economy growth expects increase of electricity consumption> Base scenario shows a growth rate in SEE off 2.3 % p. a. (EU-Energy Demand Forecast) which is

significantly above the EU average> Outdated generation plants

> Growing economical integration with EU incl. CO2 regime

> Integration of the Balkan states to one market zone; Development of a SEE wholesale market

PLCZ SK

HU R

O

BG

SL

RSHR

BIHME

MKAL

GR

2008

PLCZ SK

HU R

O

BG

SL

RSHR

BIHME

ALGR

MK

2020

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

Electricity consumption growth CAGR until 2020 Integration of the market by 2020

CEE/SEE RATIONALE

7 | FINANCIAL CRISIS OUTLOOK

IMF updates World Economic Outlook after one month!

> World growth slows from 5% in 2007 to 3,75% in 2008 and just over 2% in 2009

> Central and eastern Europe from 5,7% in 2007 to 4,2% in 2008 and 2,5% in 2009

> Weakening prospects are depressing commodity prices

> The financial crisis remains virulent

> Consumers and firms are reassessing income prospects

1.2

2.8 2.6

1.3

0.2

4.2

2.5

6.7

5.7

4.5

3.4

-0.5-1

0

1

2

3

4

5

6

7

8

2006 2007 2008 2009

Euro area Nov 08 Euro area Oct 08

Central and eastern Europe Nov 08 Central and eastern Europe Oct 08

> Real GDP growth – Development (Percent change)

Source: IMF - World Economic Outlook

8 | FINANCIAL CRISIS NEW INVESTMENTS

-30%

> Increase of financing costs

> Higher equity/debt relation

> Increase of WACC

> Reduction of NPVs and equity IRRs

> Difficulties to find a financing bank (even together with financial institutions)

> Stronger influence of financing banks in management

> Example:NPV for a new 400 MW CCGT

9 | RISKS AND OPPORTUNITIES

o + Over-average growth rate

o + High return expectations

BUT

o ~ Political intervention- “Robin Hood”-Tax- Renewable subsidies

o ~ Tender & licensing procedures

o ~ Economic development

o ~ Development of primary energy and electricity prices

o ~ Capital intensity; financing constraints

o ~ Human resources

UNCERTAINTY REMAINS

0

20

40

60

80

100

120

140

160

High Case

Low Case

Source: Pöyry

Spread of more than 60 EUR/MWh

EUR/MWh

Forward Prices Base SEE (real 2007)