Investor Conference Call. September 20, 2007

Transcription

1 Investor Conference Call September 20, 2007

2 E.ON is the world's largest investor-owned energy services provider E.ON s industry leadership is founded on its integrated business model with sustainable operations along the entire value chain: E.ON is vertically integrated, with operations upstream (power generation and natural gas production), midstream (wholesale), and downstream (end-customer supply), enabling to optimize business while at the same time managing risks. E.ON is horizontally integrated in order to leverage power/gas convergence, providing synergy and growth potential. E.ON has achieved a strong market position in several European countries and in US Midwest. E.ON is superbly positioned to meet the new challenges of Europe s changing energy marketplace. 1

3 E.ON Group Financial highlights in billion; according to IFRS H H FY 2006 Sales Adjusted EBITDA Adjusted EBIT Adjusted net income Cash provided by operating activities Economic net debt

4 E.ON's 60 bn investment plan is well under way significant progress achieved in all growth segments Investment initiated between ( bn) ~ 60 ~ 10 Acquisition of Endesa assets/viesgo Closing expected first half bn for growth ~ 12 ~ 3 Organic growth generation excl. renewables Renewables 4 plants under construction ~ 1.5 bn Energi E2 Renovables Ibéricas ~ 1.3 bn ~ 10 Gas upstream & LNG ( 3 bn) Gas storage & gas networks 28% in Skarv-Idun area ~ 1.7 bn Gas storage and networks ~ 2.0 bn ~ 6 Neighboring markets Other growth (~ 1 bn) Envisaged 70% in OGK-4 ~ 4.1 bn ~ 18 Maintenance & Replacement 3 plants under construction ~ 2.2 bn 3

5 E.ON is one of the world s leading energy companies with a strong market presence in Europe and the U.S.-Midwest E.ON market positions 1,2 Nordic #4 in power generation #3 in power/gas retail US Midwest -Kentucky #1 in power generation #1 in power/gas retail United Kingdom #2 in power generation #2 in power/gas retail Russia Leading position in power generation (OGK4) France #3 in power generation European gas supply #1 in gas supply Spain #4 in power generation #4 in power retail/distrib. 1. Including Viesgo/ Endesa Europa assets, transaction still pending, closing exp Including the envisaged acquisition of the majority in OGK-4 Italy #3-4 in power generation #5 in gas distribution CEE including Germany #2 in power generation #1 in power/gas retail 4

6 10 until 10 : E.ON will increase its adjusted EBIT by 10 % p.a. on average until 2010 Adjusted EBIT target in bn Current growth investment from plan and net margin improvements Average growth of 10 % p.a. 1.7 New growth investment Operational improvement incl. Trading integration

7 Major elements of E.ON s finance strategy E.ON commits itself to a Single A flat / A2 target rating. E.ON s steering measure is the Debt factor (= Economic net debt / Adjusted EBITDA). E.ON s target capital structure corresponds to a Debt factor of 3x. E.ON pursues an active capital structure management. Dividend policy remains unchanged: payout ratio of 50-60% of adjusted net income. 6

8 E.ON uses the Debt factor as its core capital structure steering measure in billion Liquid funds Securities and funds (fixed assets) Total financial assets Total financial liabilities Net financial position Provisions for pensions, net Provisions for asset retirement and similar obligations, net Economic net debt Adj. EBITDA Debt factor (Economic net debt / adj. EBITDA) H x FY x 1 Last twelve months 7

9 Target capital structure shall be achieved by end of 2008 Investment program ~30 bn investments planned until end of 2008 Cash returns to shareholders Regular dividend will be supplemented by share buyback of 7 bn E.ON s Debt factor 3.0x 1.9x 1.5x Target: Debt factor of 3x by

10 Financial instruments of E.ON AG and finance subsidiaries June 2007 Current Expectation Financial instrument Volume Utilization Financial instrument Volume Medium Term Note Program 20 bn 7.2 bn Medium Term Note Program 30 bn USD bonds (Rule 144A) tbd EURO Commercial Paper Program 10 bn 1.0 bn EURO Commercial Paper Program 10 bn USD Commercial Paper Program $ 10 bn Syndicated Multi-Currency Rev. Credit Facility Agreement 10 bn 0 Syndicated Multi-Currency Rev. Credit Facility Agreement 10 bn Additional back-up facilities tbd Centralization of funding at group level continues to be pursued. 9

11 E.ON s funding plans E.ON has access to all major markets Benchmark Bond Transactions (EUR, GBP and USD) Issuance in other selected currencies (e.g. CHF, EuroYen, SEK) Reverse Inquiry drawings under E.ON s MTN Program Commercial Paper (EUR, USD, Extendables) Syndicated loan facilities Broad mix of markets, currencies, instruments and maturities Diversification of investor base Balanced maturity profile (build up of E.ON curve) Avoidance of market saturation E.ON will continue to emphasize good communication with debt investors and be as transparent as possible. 10

12 Key transaction parameters Issuer: Size: Maturities: Currency: Denominations: Listing: Documentation: Rating (E.ON AG): E.ON International Finance B. V. (fully guaranteed by E.ON AG) Benchmark bond Key tranches of 5 and 10 years EUR 50,000 EUR + 1,000 EUR Luxembourg MTN Programme (+ Change of Control Clause) A2 (Moody s), A (S&P) 11

13 Q&A

14 This document may contain forward-looking statements based on current assumptions and forecasts made by E.ON Group management. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here. These factors include those discussed in our public reports filed with the Frankfurt Stock Exchange and with the U.S. Securities and Exchange Commission (including our Annual Report on Form 20-F, in particular to the discussion included in the sections entitled "Item 3. Key Information: Risk Factors", "Item 5. Operating and Financial Review and Prospects", "Item 11. Quantitative and Qualitative Disclosures about Market Risk"). The company assumes no liability whatsoever to update these forward-looking statements or to conform them to future events or developments. 13