Oldenburg, Germany, 27 August 2021. The energy and telecommunications service provider EWE was able to continue its business activities in a stable manner in the first half of 2021, taking into account the crisis measures necessary during the COVID-19 pandemic. Operating EBIT – the key figure for the performance of the operating business, which has been adjusted for one-off effects – came in slightly above the previous year’s figure at EUR 286.8 million (H1 2020: EUR 281.9 million).
Group sales increased by 7.2 per cent to EUR 3,037.7 million as of 30 June 2021 (2020: EUR 2,833.4 million). Due to one-off effects, the Group’s result for the period was up 109.35 per cent on the previous year, increasing from EUR 135.9 million to EUR 284.5 million. The average number of employees in the EWE Group was 9,420 in the first half of 2021, compared with 9,141 at the end of 2020.
EWE’s CFO, Wolfgang Mücher, explains: “Unlike in the first half of the previous year, there have been minimal effects so far on the volume of sales and power transmission, or on the sales departments. Looking at the ongoing development of the pandemic, though, it is still not easy to make a forecast this year. As long as the crisis doesn’t worsen through further viral mutations or similar events, we do expect to see a slight continued recovery in the second half of the year.”
“There was increased demand for higher bandwidths in the telecommunications sector again this year,” says Wolfgang Mücher, “and the weather in the first few months of the year also helped because it was cooler than in previous years. Months with low winds in the first half of the year had a negative impact on earnings.”
Renewable Energies business area
The Renewable Energies business area recorded sales of EUR 107.0 million in the reporting period, which was an increase of 39.3 per cent on the first half of 2020 (EUR 76.8 million). Operating EBIT fell compared with the previous year due to lower wind yields in the first quarter, from EUR 48.9 million to EUR 21.1 million. In addition to the decline in sales, operating EBIT was also impacted by repair costs at the RIFFGAT offshore wind farm. In addition, the earnings contribution made by the offshore service company in the previous year is missing since it has since been sold.
The onshore wind energy joint venture Alterric (Aurich), which was established in spring 2021, and the other shareholdings will be included in the fully consolidated companies in the EWE consolidated financial statements for the first time and are assigned to the Renewable Energies business area. The company made a significant contribution to the positive sales development. It has not yet increased earnings however, as it was first added at the beginning of a generally low-wind summer half-year.
Infrastructure business area
In the Infrastructure business area, sales increased by 9.6 per cent to EUR 375.1 million (previous year: EUR 342.2 million). The increase in sales is mainly due to the higher upstream network costs in pricing for the distribution networks and the mild weather in the first half of the previous year. Another positive effect stems from higher fees for the marketing of natural gas storage facilities and higher capacity bookings in the gas transmission network.
Operating EBIT increased to EUR 195.0 million (H1 2020: EUR 171.1 million). In addition to higher sales from the marketing of natural gas storage facilities and higher order intake at the gas transmission network, the increase is due in particular to higher energy gross margins for electricity and gas as a result of the mild weather in the previous year at the distribution networks.
Market business area
In the Market business area, EWE recorded an increase in external sales of 4.1 per cent to EUR 1,839.7 million (H1 2020: EUR 1,768.1 million). Sales are mainly realised in the electricity and gas businesses. Higher volumes of gas sales as a result of the cool weather increased sales. In the electricity business, increasing sales mostly came from business customers. In the telecommunications field, sales rose from private customers and business customers equally.
Operating EBIT was EUR 58.3 million (H1 2020: EUR 66.5 million). The currently unfavourable market constellation makes it particularly difficult to optimise gas flexibility in the Trading area during the year and leads to negative changes. There were also losses from the start-up of business activities regarding fibre-optic network expansion and electric mobility. On the other hand, there was a positive development in energy sales, predominantly due to the weather-related increase in volume and positive price effects from biogas marketing. In telecommunications sales, higher average yields and higher utilisation led to positive sales and earnings contributions.
swb Group business area
In the swb business area, external sales came to EUR 610.2 million in the reporting period, which was 9.8 per cent higher than in the previous year (H1 2020: EUR 555.7 million). The increase in sales is also mainly due to weather-related higher sales volumes.
Operating EBIT was EUR 33.4 million (H1 2020: EUR 18.4 million). The improvement on the previous year is mostly due to the sale of cavern gas and weather-related higher sales volumes in the networks. Improved electricity earnings and revenue from the power reserve for a decommissioned energy generation production plant contributed to this trend. On the other hand, payments from the electricity tax and a poorer waste result due to lower volumes, as well as increased maintenance expenses at swb Entsorgung, decreased operating EBIT compared with the previous year.
Other business area
In the Other business area, we recorded an increase in external sales of 17.9 per cent to EUR 104.2 million (H1 2020: EUR 88.4 million). The increase in sales is mainly due to the acquisition of new customers and an expansion of the group of consolidated companies in IT.
Operating EBIT was EUR 2.3 million (H1 2020: EUR 2.1 million). Compared with the previous year, IT saw an improvement in additional business, among other things. An increase in the gross profit of gas in Poland contributed to this trend. The expansion of business with photovoltaic systems and the development of industry-oriented digital value-added services based on smart meter data for energy suppliers had a negative impact on earnings in innovations.
Group corporate centre
The Group corporate centre only generates minor sales. Operating EBIT was EUR -23.6 million (H1 2020: EUR -25.1 million). This was due to the holding function of EWE AG and the other investments allocated to it, and it was almost at the level of the previous year.
The half-year report is available at www.ewe.com.
