Vattenfall reports a stable underlying operating profit of nearly 21 billion SEK for the period January-September 2013. Cost-cuttings and price hedging have contributed to the result while higher costs for CO 2 emission allowances have had a negative impact.
Summary of the third quarter and the nine month period: • Net sales rose by 9.9% to SEK 36,997 million (33,679) for the quarter and by 3.8% to SEK 123,922 million (119,376) for the nine month period. • The underlying operating profit decreased by 10.6% to SEK 3,999 million (4,474) for the quarter while the underlying operating profit rose by 0.4% to SEK 20,949 million (20,875) for the nine month period. • Operating profit amounted to SEK 4,818 million (-2,778). The nine month operating profit was SEK -10,292 million (20,861) as a result of impairment losses of SEK 29.7 billion during the second quarter of 2013. • Profit for the period (after tax) amounted to SEK 1,538 million (-3,975) for the quarter and SEK -15,526 million (10,705) for the nine month period. The impairment losses during the second quarter of 2013 resulted in a charge against profit of SEK 24.5 billion after tax effects. • Electricity generation was essentially unchanged, at 40.0 TWh (39.7) for the quarter, but increased by 3.7%, to 133.8 TWh (129.0) for the nine month period.
CEO’s comments:
“Wholesale electricity prices continue to be weak, which is putting pressure on profitability for Europe’s power producers. However, thanks to cost-cutting and previously contracted price hedges, Vattenfall is able to report a stable underlying profit for the period January–September 2013. Vattenfall is also showing strong cash flow after investment. The reported profit in the half-year interim report was charged with impairment losses of nearly SEK 30 billion. Excluding these impairment losses and other items affecting comparability, the return on capital employed was 9.5%,” says Øystein Løseth, Vattenfall President and CEO .
“The work on splitting up Vattenfall’s operations into two regions – the Nordic countries and Continental Europe/UK – is progressing according to plan, and the new organization will take effect on 1 January 2014. The new geographic organizational structure will improve our opportunities to meet the varying conditions and challenges in the respective markets,” says Øystein Løseth .
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Press release, October 29, 2013; Image: Vattenfall