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2013 results of BKW Inc.
Solid operating performance - foundations laid for the new BKW
Bern (ots) - In what proved to be an exceptionally challenging economic and regulatory environment, the BKW Group achieved a very good operating profit for the 2013 financial year. Contributory factors included in particular higher production volumes, the growing service business, a stable networks business and consistent implementation of the cost reduction programme. The result was impacted by high value adjustments for production plants and investments. The corporate strategy was further refined in 2013, and important foundations were laid down for the future.
The BKW Group posted total operating revenue of CHF 2,734 million. At CHF 317 million, adjusted operating income (EBIT) was on a par with the previous year. The energy business (including trading), networks business and the services business contributed to this strong result. Group companies ISP AG and Arnold AG posted strong growth. Impairment tests carried out on production facilities and investments resulted in the need for a correction totalling CHF 489 million in consideration of expected future conditions on the energy market. As a result, adjusted EBIT ended the year at CHF -172 million, leading to a net loss of CHF 217 million. Adjusting for the exceptional charges, net profit amounted to CHF 166 million.
Implementation of corporate strategy
In 2013, with a view to its future positioning, BKW laid the foundations on which to expand the business portfolio and further refined its corporate strategy. At the same time BKW also completed the organisational restructuring, drove forward the Groupwide programme to increase productivity and reduce costs, and expanded renewable energy production facilities both in Switzerland and abroad. In view of the increasingly distributed nature of energy supplies, BKW also further developed its range of services - for example, cooperation with a view to expanding photovoltaics, and implementation of an ultra-modern street lighting system.
From energy supplier to innovative energy services provider Over the next few years, BKW is aiming to significantly expand its service business and launch innovative technology-based products and integrated solutions on the market, and develop customised service packages for private and business customers, municipal authorities and other energy utilities. The first planned offerings will be in the fields of engineering, heating and energy management. This new focus will allow BKW to position itself across Switzerland as a provider of innovative integrated energy services, open up new sales channels and develop new partnership models. To further strengthen the BKW brand, BKW will discontinue using the 1to1 energy brand in future.
2014 Annual General Meeting
A dividend of CHF 1.20 will be proposed to the Annual General Meeting on 9 May 2014. The proposed dividend is based on the CHF 166 million net profit for the year adjusted for non-cash exceptional impairment charges and provisions for production facilities. This equates to a payout ratio of around 40%, and reflects the consistency of BKW's dividend policy.
BKW is not expecting any change in the challenging market environment in the current financial year, with energy prices set to remain low and ongoing margin pressure. Coupled with regulatory requirements and a persistently strong Swiss franc, this will also affect the operating result for 2014. Stable networks business, production volumes that have largely been hedged for some time now, and the ongoing expansion of the services business lead BKW to expect its operating income and net profit to remain in line with the adjusted figures for 2013, excepting any impairment tests.
The statements contained in this press release constitute expectations and forward-looking statements. Because these statements are subject to risks and uncertainties, actual future results may differ materially from those expressed or implied by the expectations and statements. This media release is issued in German, French, English and Italian. The German version is authoritative.
--- The BKW Group is one of Switzerland's largest energy service companies. It employs more than 3,000 people, with its partners supplies around one million people with electricity, and covers all stages of energy supply: from production and transport to trading and sales. In addition to pure energy supply, BKW develops, implements and operates comprehensive energy solutions for private and commercial customers, as well as for energy utility companies and local authorities. It is also committed to programmes focusing on research and development of innovative technologies to ensure a sustainable secure energy supply.
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