EVN Company Presentation February 2015

EVN Company presentation February 2015

Agenda

EVN at a glance Market environment and strategy EVN’s success drivers Outlook Appendix − Management Board − Financial performance 2013/14 − Description of segments − CSR − RAG − Investments and projects − Retrospective adjustments of 2012/13 financial figures − Contact details

2 EVN profile

Leading integrated energy and Shareholder structure environmental services company (as of 30.09.2014) serving customers in Lower Austria, SEE and CEE

Key activities − Energy generation (renewable, thermal) − Regulated grid (electricity, natural gas) − Energy supply − Environmental services

EVN at a glance 3 EVN at a glance Energy business – 6 countries

Albania 1) Austria Bulgaria Croatia Germany 2) 3) Macedonia

1) EVN share: 50% 2) EVN share: 13% 3) EVN share: 49%

EVN at a glance 4 EVN at a glance Environmental services business – 18 countries

Austria1) Poland Bahrain Romania Croatia Russia2) Cyprus Serbia Czech Republic Slovenia Germany Turkey Montenegro

1) Thermal waste utilisation plant, drinking water supply 2) Thermal waste utilisation plant EVN at a glance 5 EVN at a glance 6 Strategic investments

12.63% #1 electricity producer in Austria with 8.6 GW installed capacity (encompasses ~1% of shares held by WEEV)

13.0% 13 run-of-river plants with 312 MW installed capacity Verbund-Innkraftwerke GmbH (EVN stake: 41 MW)

73.63% #1 green energy producer in Austria and local gas distributor

50.03% #2 oil & gas producer in Austria, one of the largest gas storage operators in CE with 5.7bn m³ working gas capacity

16.51% Distributor and B2B natural gas supplier in Austria

EVN at a glance 6 EVN at a glance Lower Austria – EVN’s prosperous domestic market

Province of Lower Austria at a glance:

2 Area: 19,186 km (~ Half size of Switzerland) Population (2014) 1,625,485 Economically active population, 15-64 years 73.3% (Austria: 72.3%) (2013): 1) GDP per capita (2013): EUR 31,100 (Austria: EUR 38,050; Germany: EUR 33,355)

Sources: Statistics Austria; Eurostat; economic-growth.eu 1) Lower Austrian GDP per capita 2013: preliminary figures EVN at a glance 7 EVN at a glance Bulgaria – EVN’s focus in SEE

Bulgaria at a glance:

Area: 111,000 km2

2 EVN's supply area: ~42,000 km (~ Size of Switzerland) Population (2014) 7,364,570 Economically active population, 15-64 years 62.2% (Austria: 75.6%) (2014) GDP per capita (2013) EUR 12,000 (Austria: EUR 38,050; Germany: EUR 33,355)

Sources: Eurostat, Bulgarian National Statistical Institute EVN at a glance 8 http://censusresults.nsi.bg/Census/Reports/2/2/R3.aspx

EVN at a glance Macedonia – EVN’s focus in SEE

Macedonia at a glance:

Area: 25,713 km2

EVN's supply area: 25,713 km2

Population (2014) 2,065,769 Economically active population, 15-64 years 65.3% (Austria: 75.6%) (2014): GDP per capita (2013) EUR 8,868 (Austria: EUR 38,050; Germany: EUR 33,355)

Sources: Eurostat, Macedonian State Statistical Office EVN at a glance 9 EVN at a glance Contribution by business segments for 2013/14 (Financial year 2013/14 figures adjusted for one-off effects)

Revenue split1) EBITDA split1)

Generation 8% Generation 15%

Energy Trade and Supply 19% Energy Trade and Supply 11%

Network Infrastructure Austria 21% Network Infrastructure Austria 37%

Energy Supply SEE 41% Energy Supply SEE 17%

Environmental Services 8% Environmental Services 10%

Strategic Investments and Others 3% Strategic Investments and Others 12%

1) Pre consolidation EVN at a glance 10 EVN at a glance 11 Financial figures 2013/14

y-o-y 2.500 EURm 2013/14 in % 2012/13 Revenue 1,974.8 –6.2 2,105.9 2.000 1,974.8 EBITDA 184.1 –65.9 540.0 EBIT –341,4 – 242,2 1.500

Group net profit –299.0 – 109.3 1.000 Net cash flow from EURm operating activities 546.0 –4.2 570.0 500 1) Investments 396.3 6.3 372.9 184.1 Balance sheet total 6,841.8 –6.1 7,283.7 0 Revenue EBITDA EBIT Group net result Equity 2,632.7 –14.5 3,079.2 -299.0 -500 -341.4 Equity ratio 38.5% – 42.3%

Net debt 1,622.4 –10.3 1,809.6 2013/14 2012/13 Gearing 61.6% – 58.8%

1) In intangible assets and property, plant and equipment EVN at a glance 11 The EVN share

Basic information Dividend yield 4.1% Share capital EUR 330,000,000 4,0% 3,5% Denomination 179,878,402 shares 3,0% ISIN AT000741053 2,5% 2,0% EVNV.VI (Reuters); EVN AV (Bloomberg); EVN 1,5% Tickers (Dow Jones); EVNVY (ADR) 1,0% 0,5% 0,0% 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14

Kursentwicklung der EVN Aktie im relativen Vergleich

Okt 13 Nov 13 Dez 13 Jan 14 Feb 14 Mrz 14 Apr 14 Mai 14 Jun 14 Jul 14 Aug 14 Sep 14 Okt 14 Nov 14 Dez 14 Jan 15

EVN ATX ATX Prime Dow Jones Euro Stoxx Utilities

EVN at a glance 12 Agenda

13 Market environment

Distorted energy markets − Market design under discussion − Increasing share of volatile renewable production supported by subsidised feed in tariffs − Deterioration of wholesale electricity prices − Operation of state-of-the-art gas-fired power plants actually unprofitable Uncertainty in economic environment − Weak economic growth Political instability − Especially in South Eastern Europe

Market environment and strategy 14 Energy price developments

Crude oil price Brent in EUR/bbl Hard coal prices API2 in EUR/tonne

87 100 80 82 76 88 70 71 71 65 60 70 72 64 52 53 61 59 44 57 57 58 44 49 50 50

2005 2007 2009 2011 2013 2015 2017 2005 2007 2009 2011 2013 2015 2017 The respective spot market prices had been considered until the notification day The respective spot market prices had been considered until the notification day

Electricity prices in EUR/MWh Spreads in EUR/MWh Electricity price Peak Clean Dark Spread 88 Electricity price Base 23 20 21 74 18 18 15 66 13 13 63 11 12 61 9 10 10 56 55 7 8 7 8 7 51 51 51 53 5 5 46 49 44 43 43 42 38 39 38 41 41 33 34 34 33 2005 2007 2009 2011 -6 2013 2015 2017 -8 -13 -12 -14 -15

2005 2007 2009 2011 2013 2015 2017 The respective spot market prices had been considered until the notification day The respective spot market prices had been considered until the notification day

Source: EVN; November 2014 Market environment and strategy 15 EVN at a glance 16 Regulated business in Austria

Network Electricity Gas Comments

Regulatory authority E-Control GmbH E-Control GmbH

Start of the regulatory period 01.01.2014 01.01.2013

Next regulatory adjustment 01.01.2019 01.01.2018 Adjustment of WACC and productivity factors

Duration of the regulatory period 5 years 5 years

Regulatory method Revenue caps Revenue caps

Annual investments are added to the RAB in the RAB (EURm) Annually adjusted Annually adjusted following year

WACC (pre-tax, nominal) 6.42% 6.42% Set for length of regulatory period Electricity: 50% of the achieved productivity increases are passed on to end customers during the regulatory General productivity factor 1.25% 1.95% period Natural gas: Gains from cost reductions remain with the company during the regulatory period Company specific productivity factor 0.36% 0.00% Additional X factor is company specific Network operator price index consists of consumer (30%) Inflation Annual adjustment Annual adjustment and building price (40%) indices as well as wage increase index

Market environment and strategy 16 EVN at a glance 17 Regulated business in South Eastern Europe

Bulgaria1) Bulgaria Macedonia Electricity (electricity) (heat) (electricity) SEWRC SEWRC ERC Regulatory authority (State Energy and Water (State Energy and Water (Energy Regulatory Commission) Regulatory Commission) Regulatory Commission) Start of the regulatory period 01.08.2013 01.07.2014 01.07.2012

Next regulatory adjustment 01.08.2015 01.07.2015 01.07.2015

Duration of the regulatory period 2 years 1 year 3 years

Regulatory method2) Revenue caps Rate of return on capital Revenue caps

RAB (EURm) Annually adjusted Annually adjusted Annually adjusted

WACC (pre-tax, nominal) 7.0% 7.6% 6.7%

Recognised network losses 8.0% 20,0 % 14.0%

Productivity factor Yes Yes No

Investment factor3) No No Yes

1) Regulatory decision based on new energy law still pending. 2) The revenue caps comprise the recognised operating expenses, the amortisation and depreciation as well as the recognised return on the RAB. 3) Annual review and approval of company’s investment plans by the regulatory authority. Source: Regulators in Bulgaria (SEWRC) and in Macedonia (ERC) Market environment and strategy 17 EVN‘s position within the value chain in SEE

Energy – from state Distribution End Customers owned Public Provider

Energy

Regulated

Grid

Regulated

Energy – Wholesale Distribution End Customers market

•

Local Energy Tenders • Import • Own Other Eligible production Suppliers

Market environment and strategy 18 Regulated electricity price developments in SEE

Price development in Bulgaria – regulated HH tariff Price development in Macedonia – regulated HH tariff (EUR1)/MWh) (EUR2)/MWh)

56,5 36,8 36,0

30,3 42,9 27,3 24,9 26,3 34,8 35,1 36,2 24,1 24,3 32,7 33,3 22,2 27,2 27,0 27,8 26,5 27,1 21,9 23,0 28,2 19,9 26,3 26,4 24,4 25,6 23,0 22,8 22,2 14,7 15,1 15,4 4,2 4,7 4,9 5,4 17,5 3,6 3,6 4,0 15,0 1,7 1,7 12,1 11,7 7,7 9,0 4,8 4,1 5,5 6,8 2006 2007 2008 2009 2010 2011 2012 2013 2014 2006 2007 2008 2009 2010 2011 2012 2013 2014

Energy supply Transmission Distribution Energy supply Transmission Distribution

Energy supply for regulated business is performed by EVN Bulgaria EC and EVN Macedonia Price increases in “Energy supply” mainly due to increased electricity procurement costs for EVN from governmental owned suppliers NEK and ELEM!

Source: Regulators in Bulgaria (SEWRC) and in Macedonia (ERC) 1) Exchange rate Bulgaria: EUR/BGN 1.956 Market environment and strategy 19 2) Exchange rate Macedonia: EUR/MKD 61.5 Tariff schemes 2015 for renewable energy sources

Renewable energy source Austria Bulgaria Macedonia Wind Feed-in-tariffs Feed-in-tariffs Feed-in-tariffs Tariff (EUR-cent1)/kWh) 9.27 6.1 – 9.8 8.9 Duration (in years) 13 12 20 Installed capacity 2014 (MW) 2,100 674 36.8 Target value for installed capacity 2020 (MW) 2,578 1,440 150

Water Feed-in-tariffs Feed-in-tariffs Feed-in-tariffs Tariff (EUR-cent1)/kWh) 3.2 – 10.4 4.8 – 13.6 4.5 - 12.0 Duration (in years) 13 15 20 Installed capacity 2014 (MW) 8,370 3,164 26.4 Target value for installed capacity 2020 (MW) 8,998 3,288 -

Photovoltaic Feed-in-tariffs Feed-in-tariffs Feed-in-tariffs Tariff (EUR-cent1)/kWh) 10.0 – 11.5 8.6 – 37.3 12.0 - 16.0 Duration (in years) 13 20 15 Installed capacity 2014 (MW) 530 1,049 12.1 Target value for installed capacity 2020 (MW) 322 303 18

Sources: “Investieren in Erneuerbare Energie 2014”, Kommunalkredit; 503. Verordnung: Änderung der Ökostrom-Einspeisetarifverordnung 2012 (ÖSET-VO 2012) http://www.e-control.at/portal/page/portal/medienbibliothek/oeko-energie/dokumente/pdfs/BGBLA_2013_II_503-novelle-oekostrom-einspeisetarif-vo-2012.pdf 1) In countries with tariffs in local currencies, tariffs have been converted with the exchange rate as of 01.07.2014. 2) “Installed capacity 2014” relates to estimates and assumptions due to available information as of 01.02.2013. Market environment and strategy 20 Strategy

Virtue of integrated business model Focus on region of Lower Austria (multi-utility in Lower Austria) Provider of high quality services − Electricity, gas, drinking water, wastewater treatment, thermal waste utilisation, cable TV, telecommunication Focus on stable business − Regulated and non-regulated Provide consistent dividends Upside potential in − Renewable energy production (mainly wind) − South Eastern Europe − Environmental services

Market environment and strategy 21 Agenda

22 EVN at a glance 23 EVN‘s success drivers

# 1 Solid home market

# 2 Strong market position

# 3 High share of earnings from regulated and stable business

# 4 Upside potential in SEE

# 5 Diversification through environmental business

# 6 Strategic investments

# 7 Solid capital structure

EVN’s success drivers 23 # 1: Solid home market

The Austrian electricity market continues to Electricity consumption in be stable1) in TWh Austria Germany 2013 (Jan-Dec) 61,5 555,1 − Increase in number of households 2014 (Jan-Dec)3) 61,0 534,0 (more senior citizens and single households) Change (%) -0,81% -3,80% Source: Austria www.econtrol.at, Germany: www.ag-energiebilanzen.de − Increase in demand for transport sector, lighting, electronic data processing applications, heating and air conditioning

Outlook electricity consumption in 8,30 +0.95% 2) 8,20 Lower Austria +0.64% 8,10 +1.23%

+1.44%

8,00 GWh 7,90

7,80

7,70 2014 2015 2016 2017 2018

1) Source: European Network of Transmission System Operators for Electricity (www.entsoe.eu) 2) Source: EVN EVN’s success drivers 24 3) December 2014 consumption: preliminary figures

# 1: Characteristics of the Austrian utility market

No nuclear power generation − Public vote in the 1970s against nuclear power High share of hydropower assets − 67%1) of Austrian electricity generation sourced from hydropower

67% 27% 8%

Hydropower Thermal Other renewables (e.g. wind, photovoltaics, biomass)

− In 2013, #1 in EU at share of renewable energy sources in electricity generation measured by the country’s land area2) (75% of Austrian electricity generation sourced from renewable energies) Further renewable energy projects are in the planning or implementation process 1) Source: Oesterreichs Energie (www.oesterreichsenergie.at ); data from 2013 2) Source: Energiestatus Österreich 2013, Bundesministerium für Wirtschaft, Familie und Jugend EVN’s success drivers 25

# 1: Characteristics of Austrian utility market

Low customer churn rates Electricity market 2013: − Churn rate of Austrian end customers: 1.9%1) − 5 largest suppliers hold more than 2/3 of market share2) Gas market 2013: − Churn rate of Austrian end customers: 2.5%1) − 5 largest suppliers hold approximately 80% of market share2) In Austria, electricity and gas account for only 4.5% of household income (Germany: 6.0%)3)4) Low political risk − Transparent and predictable regulatory framework − High proportion of public ownership (regulated by law) − Public views utilities as basic public service No major foreign competition of suppliers − Fairly small market size with prices at EU average

1) Source: E-Control, market statistics – consumer attitude/churn rates electricity and gas according to network areas; 2) Source: „Marktbericht 2013“, National report to EU Commission 3) Source: http://www.statistik.at/web_de/frageboegen/private_haushalte/eu_silc/index.html#index10 4) Source: Forschungsprojekt Nr. 54/09 des BMWi, „Erhebung des Energieverbrauchs der privaten Haushalte für die Jahre 2009-2010“ (pdf) EVN’s success drivers 26

# 2: Strong market position in Austria

Lower Austrian electricity market share Austrian electricity market share Lower Austrian gas market share Austrian gas market share

EVN EVN 10% 7% Others Others 27% EAA& 27% Parterns 18% EVN Others 45% 46% EconGas 36%

Others EVN 73% 72% EconGas 28% EAA& Parterns 11%

8 TWh 59 TWh 15 TWh 93 TWh

Churn rates in Lower Austria 4,0%

3,8% 3,0% 2,6% 2,2% 2,4% 2,0% 1,8% 1,8% 2,6% 1,6% 1,4% 1,5% 1,1% 0,8% 0,8% 1,5% 0,5% 1,4% 1,2% 1,0% 1,1% 0,8% 0,8% 0,8% 0,7%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 9/2014

Electricity Gas

Source market shares: E-Control 2012, annual report and company numbers Source churn rates: E-Control, market statistics – consumer attitude/churn rates electricity and gas according to network areas EVN’s success drivers 27 EVN holds a 45% stake in EAA & Partners and a 16.51% stake in EconGas # 2: Decentralised renewable production portfolio

#2 wind producer in Austria Strong, decentralised portfolio: Hydropower – 5 storage and 67 run-of-river hydropower plants with 109 MW generation capacity – Purchasing rights from hydropower plants along the Danube, Melk, Greifenstein and Freudenau – Investment in hydropower plant Nussdorf and Verbund-Innkraftwerke Windpower Map of Lower Austria – 13 windparks with 197 MW generation capacity – Investments: EUR ~230m

EVN’s success drivers 28 # 2: Wide-spread heat and biomass portfolio

#1 in biomass heating in Austria 5% of Group revenues and 6% of EBITDA1) Biomass portfolio

− More than 60 biomass plants in Lower Austria

− Investments (in total): EUR 400m

− Contract duration: ø 15 years Heat extraction from EVN AG’s thermal power plants

Map of Lower Austria Index pricing ensures business provides stable margins and is cash flow generative

1) Basis: Financial year 2013/14 figures adjusted for one-off effects EVN’s success drivers 29 # 2: Drinking water supply

#1 drinking water supplier in Lower Austria (50 years of experience) 1.5% of Group revenue and 3.1% of Group EBITDA1) Operation of 36 local drinking water supply networks More than 500,000 customers

− thereof 87,000 directly supplied

Map of Lower Austria

1) Basis: Financial year 2013/14 figures adjusted for one-off effects EVN’s success drivers 30 # 3: High share of earnings from regulated and stable business

Financial year 2013/14 figures adjusted for one-off effects Majority of EBITDA (~70%) derives from regulated or stable earnings Regulated business Stable business − Grid in Austria − Water supply business in Lower Austria (3.1%) − Grid, supply and heating in SEE − Heating business in Lower Austria (6.0%) − Cable TV and telecommunication (5.3%) Unregulated business − Waste incineration in Lower Austria (5.3%) − Energy trade and supply − International environmental projects − Generation − Oil and gas E&P/gas storage

EVN’s success drivers 31 EVN at a glance 32 # 3: Geographical split of revenues and EBITDA (Financial year 2013/14 figures adjusted for one-off effects)

Geographical revenue split2) Geographical EBITDA split2)

2.400 500 4% 2% 2.200 6% 2% 2.000 450 13% 1.800 40% 45% 25% 1.600 400 1.400 1.200 350 1.000 800 300 84% 600 50% 51% 73% 400 250 200 0 200 2012/13 2013/14 2012/13 2013/14

Austria CEE and SEE Others Austria CEE and SEE Others

1) Pre consolodiation EVN’s success drivers 32 EVN at a glance 33 # 4: Upside potential from South Eastern European market development

Volume Price Efficiency

Illustrative electricity sales Electricity prices for households Improvement of grid efficiency volumes per EVN customer1) (EUR cent/kWh)2)

29,8 100%

20,2 20,5

74%

24,9%

58% 22,0%

21,0%

19,5%

18,4%

9.1

17,5%

17,0%

8.1

16,6%

16,3%

15,4%

16,0%

15,0%

14,4%

12,2%

11,9%

11,5%

10,9% 10,8%

Bulgaria Macedonia Lower Austria Bulgaria Macedonia Germany Austria EU-28 04/05 05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14

2013 2014 Grid losses, Bulgaria Grid losses, Macedonia

1) In %, basis: Lower Austria = 100% 2) Prices incl. energy, grid and transmission costs + VAT; Sources: Eurostat + EVN Bulgaria & EVN Macedonia EVN’s success drivers 33 # 5: Diversification through environmental business

Austrian business International project business EVN‘s activities in Austria cover EVN designs and constructs − Drinking water supply − Drinking water plants − Wastewater treatment − Wastewater treatment plants − Thermal waste utilisation plant − Thermal waste utilisation plants EVN owns facilities More than 100 turn-key and PPP EVN holds concessions projects in 18 countries since 1983 − 9 projects currently under construction Strong demand for infrastructure projects set to continue

EVN’s success drivers 34 # 5: Project types of international environmental services business

Turn-key project PPP project

Design Design Construct/build Construct/build Scope of activities Operate (optional) Operate Structure financing Own part or all of equity

1–3 years (designing and building) 10–30 years Contract length 5–15 years (operations)

Capital intensity Low High

Design and build – POC Design and build – Percentage of Operations – recurring annual revenues completion (POC) Return characteristics Operations – recurring annual revenues Capital charge payment (recurring or one- time payment)

None to EVN – done by customer Non-recourse financing to EVN post Financing construction period

Low barrier to entry – intensive High barrier to entry due to necessary Market competition driving margins down project management expertise and high characteristics capital demands for financing

EVN’s success drivers 35 EVN at a glance 36 # 6: Strategic investments

120 Significant contribution to EVN’s net

100 24,1 profit

22,1 9,7 40,1 RAG and Verbund are the main 80

1,9 contributors

60 7,6

EURm Income from RAG below prior-years level

40 80,1 mainly due to absence of positive one- 73,5 58,0 offs in 2012/13 20 Contribution from Verbund increased due 0 to higher dividend for 2013 of 11/12 12/13 13/14 RAG Energie Burgenland Verbund 1.00 EUR/share

EVN’s success drivers 36 EVN at a glance 37 # 7: Solid capital structure

100% 7.283,7 7.500 6.841,8 Solid equity ratio 80% 6.000 Reduced net debt; gearing ratio 60%

4.500 42,3% influenced by slightly decreased

EURm 38,5% 40% 3.000 3.079,2 2.632,7 equity

1.500 20% Rating 0 0% 30.09.2013 30.09.2014 − S&P: BBB+, stable Total assets Equity Equity ratio (%) − Moody’s: A3, negative

1.809,6 100% 1.800,0 1.622,4 EVN aims at preserving a competitive 1.600,0 80% 1.400,0 58,6% 61,6% 1.200,0 investment grade credit rating 60% 1.000,0 800,0EURm 40% 600,0 400,0 20% 200,0 0,0 0% 01.01.2013 01.01.2014 Net debt Gearing (%)

EVN’s success drivers 37 EVN at a glance 38 # 7: Debt maturity profile

1300,00 1.224,6 Balanced debt maturity profile 1200,00 1100,00

1000,00 527,9 900,00 Liquidity reserves 800,00 700,00 − Syndicated loan of EUR 400m 600,00 500,00 − Committed bilateral credit lines of 400,00 256,0 696,7 300,00 236,2 EUR 175.0m 129,1 200,00 149,4 75,5 100,00 256,0 28,4 100,7 86,8 ,00 75,5 EURm GJ 2014/15 GJ 2015/16 GJ 2016/17 GJ 2017/18 > GJ 2017/18

Bank debt Bonds

EVN’s success drivers 38 EVN at a glance 39 # 7: Strong operating cash flow

570,0 Strong cash flow -4.2% 546,0 − due to high share of regulated and

stable business

− secures attractive and stable dividends EURm and future investment activities

2012/13 2013/14

EVN’s success drivers 39 EVN at a glance 40 # 7: Financial policy and dividends

Financial policy going forward based on selected key ratios 0,42 0,42 0,42 0,40 0,41 0,38 0,37 0,37 (unadjusted): 0,35 – Equity ratio > 40% 0,29 (30.09.2014: 38.5%) 0,24

0,19 0,19 – Net debt coverage (FFO) ≥ 30% 0,18 (30.09.2014: 41.3%)

– Interest cover (FFO) ≥ 5x (30.09.2014: 8.1x)

Dividend: EVN follows an attractive and sustainable Dividend per share in Euro dividend policy

EVN’s success drivers 40 Agenda

41 Outlook

On energy markets Persistent distortions Low wholesale prices Volatility in production

On EVN 2014/15: Group net result is expected to exceed the 2012/13 financial results EVN’s strategy: – Consolidation of existing business in core markets – Further increase of efficiency – Focus on integrated business model – Continued investment priority in Lower Austria

Outlook 42

Appendix

43 Agenda

44 Investments and projects 45 EVN‘s Management Board

Peter Layr, Spokesman of the Executive Board Born in 1953. Doctorate in Technical Science. Joined EVN in 1978. Member of the EVN Executive Board since October 1999. Named Spokesman of the EVN Executive Board in January 2011. His term of office expires on 30 September 2019.

Stefan Szyszkowitz, Member of the Executive Board Born in 1964, Master of Law, Master of Business Administration. Joined EVN in 1993. Member of the Executive Board since January 2011. © VERBUND His term of office expires on 19 January 2016.

Management Board 45 Agenda

46 Business development 2013/14

Energy business impacted by price developments and mild winter

EUR ~560m impairments and valuation allowances: − Tariff decisions in Bulgaria and Macedonia − On generation capacities in Austria and Germany − On a leasing receivable of thermal utilisation plant no. 1 in Moscow − On the sludge treatment plant and components of the co-generation plant Ljuberzy in Moscow

Negative Group net result of EUR –299,0m

Net debt reduced by EUR 187.2m to EUR 1.6bn

Dividend proposal constant at EUR 0.42 per share

47 Key financials

+/– Reduction in revenue EURm 2013/14 in % Lower demand in the energy business due Revenue 1,974.8 –6.2 to the mild winter weather EBITDA 184.1 –65.9 Regulatory decisions in Bulgaria and Depreciation and amortisation –256.0 –7.6 Effects from impairment tests –269.5 – Macedonia EBIT –341.4 – Less processed orders in international Financial results –31.9 55.3 project business Group net result –299.0 – Net cash flow from Year- on-year drop in EBITDA, operating activities 546.0 –4.2 negative EBIT

Valuation allowance due to the thermal EUR waste utilisation plant no. 1 in Moscow Earnings per share –1.68 – Impairments primarily driven by SEE investments

Improvement in financial results

Solid net cash flow from operating activities

48 Solid balance sheet structure, reduced net debt

Equity ratio 38.5% Net debt reduced by EUR 187.2m due to strong net cash flow from operating activities Gearing ratio 61.6%

49 EBITDA development by segments

Generation Energy Trade Network Infrastructure Energy Supply Environmental and Supply Austria South East Europe Services

Commissioning of Sales of Duisburg– Increase in natural gas Tariff decisions in July Valuation allowance Duisburg–Walsum and Walsum production; network tariffs, 2014 led to on leasing receivable Prellenkirchen absence of last year’s decrease in electricity impairments; mild related to the waste windpark; absence of one-off network tariffs winter and low rainfall utilisation plant no. 1 last year’s one-off in Moscow 50 Generation

+/– Rise in power generation Electricity generation volumes GWh 2013/14 in % Commissioning of Duisburg-Walsum power plant Total 3,720 23.2 and Prellenkirchen windpark; full-year operations Renewable energy sources 1,534 –6.2 Thermal energy sources 2,186 57.9 in the Deutsch-Wagram windpark Lower production from renewables due to

Financial performance EURm reduced water flows Revenue 187.5 64.0 Results from at equity accounted –38.9 13.6 investees with operational nature Year-on-year rise in EBITDA , decrease in EBIT EBITDA 33.6 – Revenue increase due to commissioning of EBIT –53.1 –43.6 Duisburg-Walsum and allocation of reserve capacity Increase in results from equity accounted investees in spite of impairment loss on Verbund Innkraftwerke Increase in depreciation due to recognition of impairment losses related to thermal (Austria) and renewable (Bulgaria) production capacities

Energy Trade and Supply

End customer price adjustment1) Decline in sales volumes Electricity 1.10.2014 –10.0% Lower sales of electricity, gas and heat due to Natural Gas 1.10.2013 –3.6% milder temperatures Lower sales volumes by EnergieAllianz Sales volumes to +/– end customers GWh 2013/14 in % Electricity 6,787 –5.6 Increase in EBITDA and EBIT Natural gas 5,383 –15.0 Rise in revenue primarily due to the sale of Heat 1,806 –2.8 Duisburg-Walsum generated energy Absence of last year’s negative effects led to Financial performance EURm better results from at equity accounted investees Revenue 448.6 10.6 Results from at equity accounted Higher operating expenses 55.2 44.2 investees with operational nature Depreciation remains nearly unchanged EBITDA 55.3 93.5 EBIT 39.2 –

1) Average, household sector (source: EVN) 52 Network Infrastructure Austria

Tariff adjustments1) Lower distribution volumes Electricity 1.1.2014 –9.0% Electricity: higher demand from industrial 1.1.2014 Natural gas 7.7% customers almost compensated lower demand

Network distribution +/– from households and small businesses volumes GWh 2013/14 in % Natural gas: temperature-related drop Electricity 7,874 –0.1 2) Natural gas 14,131 –7.2 Reduction in EBITDA and EBIT Decrease in revenue: Financial performance EURm  Lower electricity network revenues due to Revenue 484.6 –2.6 EBITDA 186.8 –12.1 tariff reduction EBIT 83.3 –25.6  Lower gas network revenue because of temperature related decline in gas sales Positive revenue development in cable TV and telecommunication business

1) Average, according to the regulator in Austria (E-Control) 2) Including network sales to EVN‘s power stations 53 Energy Supply South East Europe

Decline in electricity generation and End customer price adjustments1) distribution volumes, stable network Bulgaria electricity 1.7.2014 0.6% 1.1.2014 –1.0%/–10.0%2) distribution volumes heat 1.1.2013 5.1% Less rainfall led to decrease in hydropower Macedonia electricity 1.7.2014 3.5% production; technical standstill at the co- 1.7.2013 –3.0% electricity generation plant in Plovdiv +/–

Key energy business indicators GWh 2013/14 in % Weather related decline in electricity and heat Electricity generation volumes 400 –6.4 sales 3) Network distribution volumes 13,034 –0.0 Heat sales volumes to end customers 185 –9.6 Drop in EBITDA and EBIT Decrease in sales revenues due to Financial performance EURm Revenue 900.8 –10.6  Previous regulatory tariff decisions EBITDA 20.2 –82.8  Recognition of a liability in Bulgaria EBIT –232.8 – referring to previous revenues Lower OPEX due to absence of additional expenses for eco-electricity Higher depreciation and amortisation mainly due to impairments on Bulgarian and Macedonian customer base and goodwill

1) Average, household sector, according to the regulators in Bulgaria (SEWRC) and Macedonia (ERC) 2) 1% decrease in day tariffs; 10% decrease in night tariffs 54 3) In Bulgaria and Macedonia energy sales volumes fairly equal present network distribution volumes

Environmental Services

+/– Year-on-year drop in EBITDA and EBIT

Financial performance EURm 2013/14 in % Reduction in revenue Revenue 191.1 –23.0  Lower volume of processed orders in EBITDA 144.6 – international project business EBIT –214.9 –  Rise in Austrian thermal waste utilisation Financial results –4.0 –  Expansion of drinking water supply to new Profit before income tax –218.8 – communities Increase in operating expenses  Valuation allowance on leasing receivable in connection with the thermal waste utilisation plant no. 1 in Moscow  Increase in depreciation and amortisation due to impairment losses related to plants in Ljubercy, Moscow

Business development Opening of the wastewater purification plant Mia Milia/Haspolat, Cyprus Sale of sodium hypochlorite plant

55 Cash flow

+/– Year-on-year drop in gross cash flow EURm 2013/14 in % Negative Group net result, yet, mainly due to non- Gross CF 337.4 –37.2 cash items such as valuation allowances and Net CF from operating activities 546.0 –4.2 impairment losses

Net CF from investing activities –243.3 32.2 Lower net cash flow from Net CF from financing activities –335.0 – operating activities Net change in cash and cash equivalents –32.3 – Despite higher trade payables, provisions and other current liabilities

Net cash flow from investing activities Investments in network infrastructure and production capacities Sale of short-term cash funds

Decline in net cash flow from financing activities due to scheduled repayment of bonds Outlook and strategy 2014/15

Outlook 2014/15

– Group net result expected to exceed 2012/13 results EVN’s strategy

– Integrated business model – Consolidation of existing business in core markets

– Increase of efficiency Focus on Lower Austria

– Customer loyalty measures

– Investment of EUR 1bn in security of supply and renewable energy

57 Agenda

58 EVN – a fully integrated utility player

Generation • Electricity generation from thermal sources and renewable energies (Austria, Germany, Albania and Bulgaria)

Energy Trade and Supply • Procurement of electricity and primary energy sources (Austria and Germany) • Trading and selling of electricity and natural gas to end customers and on wholesale markets (Austria and Germany) • Heat generation and sales (Austria)

Network Infrastructure Austria • Operation of regional electricity and natural gas networks (Austria) • Cable TV and telecommunications networks (Austria)

Energy Supply South East Europe • Operation of electricity networks and electricity sales (Bulgaria and Macedonia) • Heat generation and heat sales (Bulgaria); Electricity production (Macedonia) • Construction and operation of natural gas networks (Croatia) • Energy trading within the whole region

Environmental Services • Drinking water supply, wastewater disposal, thermal waste incineration (Austria) • Combined cycle heat and power co-generation plants • International project business

Description of segments 59 Agenda

60 EVN – A responsible energy and environmental services provider

Sustainable Investment: listed in 4 sustainability indices (VÖNIX, FTSE4Good, Ethibel, ECPI)

Reporting to the Carbon Disclosure Project (2014 result: 63D)

CSR reporting: EVN publishes an integrated financial and sustainabilty report according to GRI G4 „comprehensive“ (Winner of the Austrian Sustainability Reporting Award 2013)

Member of the UN Global Compact

EMAS certified environmental management system

61 CSR strategy and organisation

Sustainability issues are integrated in EVN‘s corporate strategy – its actual implementation is facilitated by an extensive CSR organisation:

More than 40 EVN‘s CSR organisation CSR network officers in all departments of the Group

Spokesman CSR steering of the board comittee represents CSR consisting of management the executive board CSR advisory team – inter- face between strategy & implementation

62 Regular stakeholder dialog results in strategic areas of activity

The most recent stakeholder survey and workshop in 2014 resulted in EVN‘s materiality matrix consisting of 12 strategic areas of activity The six most important areas and examples for CSR goals are:

− Security of supply – CSR goal: coverage ratio of 30% of electricity sales − Sustainable energy generation and climate protection – CSR-goal: 50% generation from renewables − Responsible employer – CSR goal: Increased share of women in new hiring and in management development programmes − Sustainable increase in corporate value – CSR goal: integration of sustainability aspects in risk management − Environmental protection and resource conversation − Customer focus The extensive CSR programme consists of more than 250 goals and measures (a comprehensive selection is listed in EVN‘s full report) 63 Agenda

EVN at a glance Market environment and strategy CSR EVN’s success drivers Outlook Appendix − Management Board − Financial performance 2013/14 − Description of segments − RAG − Investments and projects − Retrospective adjustments of 2012/13 financial figures − Contact details

64 EVN at a glance 65 Case Study: RAG – Rohöl-Aufsuchungs AG1)

Shareholder structure Revenue breakdown by segments E.ON Global Commodities EVN SE 50,03% 29.93%

Steirische Gas- Wärme GmbH 10% Salzburg AG 10%

EBITDA, EBIT and Net profit

1) Source: RAG, Annual report 2013 according to IFRS CER = Compulsory Emergency Reserves RAG 65 EVN at a glance 66 Case Study: RAG – Rohöl-Aufsuchungs AG1)

Production statistics 2013 Core areas of business Gas production m m³ 254.0 Oil and natural gas E&P 2) Gas sales m m³ 660.5 Natural gas storage Gas reserves m m³ 3,722 Oil production t 135,333 Concessions Oil reserves t 862,000 Austria (5,414 km²) Oil tank storage capacity t 260,000 Germany (4,577 km²) Hungary (3,391 km²) Natural gas storage Romania (1,106 km²)

Capacity (as of 30.9.2014) m m³ 5,716 Storage facilities (Salzburg, Upper Austria) Haidach (JV with Gazprom & Wingas; 2,656 m m³) Aigelsbrunn (130 m m³) Nussdorf/Zagling (117 m m³) Puchkirchen (1,080 m m³) 7Fields (1,733 m m³)

1) Source: RAG 2) Sales of produced, swapped and traded gas RAG 66 Case Study: RAG – reflection in EVN Group results

EVN holds a 50.03% stake in RAG through its fully consolidated subsidiary RAG-Beteiligungs-Aktiengesellschaft 100% of RAG earnings are recognised as share of profit of equity accounted investees with operational nature 49.97% of RAG earnings assigned to minority interest EVN contractually not entitled to exercise a controlling influence over RAG

RAG 67 Agenda

68 Investments and projects 69 Investments 2013/141)

450 Key investments 396.3 400 372.9 3%1% Network infrastructure Austria 3%1% 350 20% Completion of 143km natural gas pipeline 22% 300 Westschiene

250 Commissioning (24 MW) and

EURm 47% 200 construction (37 MW) of windparks in 47% Lower Austria 150 Expansion of heat networks and biomass 100 8% 8% capacities in Lower Austria 50 18% 21% Expansion of the network infrastructure 0 and replacement of metres in SEE 12/13 13/14 Investments in natural gas network Strategic Investments and Other Business Environmental Services in Croatia Energy Supply South East Europe Network Infrastructure Austria Energy Trade and Supply Generation

1) In intangible assets and property, plant and equipment; Pre consolidation Investments and projects 69 Power generation capacities of EVN power plants

2.400 2,240 2.200 2,037 Key investments 2.000

1.800 Total generation capacity 2,240 MW 46% 1.600 Generation capacities from renewable 53% 1.400 energy increased by 13 MW to 563 MW

MW 1.200 Generation capacities from thermal power 1.000 29% increased by 190 MW to 1,677 MW 800 20% 600 Share of generation capacities from 2% 2% 400 10% 10% renewable energy at 25.1% 200 15% 14% Outlook: Construction of Prottes-Ollersdorf 0 12/13 13/14 windpark with a capacity of 37 MW

Natural gas Coal Biomass, photovoltaics and other renewables Windpower Hydropower

Investments and projects 70 EVN at a glance 71 Growth perspective in renewable energy production

Coverage ratio Increase coverage ratio in the Market entrance Bulgaria mid-term to 30% on Group level Market entrance Commissioning Macedonia Duisburg-Walsum 68% Balanced integrated business model 40% 29% 30% 19% 21% 18% 18% 18% 23% 16% 16% 03/04 04/05 05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14 mid- term

Generation mix Diversified generation portfolio

23% Renewable production mainly 32% 32% 35% 36% 36% 43% 46% 53% 50% influenced by commissioning of Duisburg-Walsum power plant in 77% 68% 68% 64% 64% 65% 57% 12/2013 54% 47% 50% Focus on wind in Austria 05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14 long- term Conventional power generation Renewables

Investments and projects 71 Gas-fired power plants in Theiss and Korneuburg

Reserve capacity for Southern Germany Reserve capacity: 785 MW over the next 2 winter half-years; 450 MW for 2017/18 Supply upon request of Federal Network Agency of Germany (“Bundesnetzagentur”) Securing the sites

Investments and projects 72 New wind park in Lower Austria

Wind park Prottes-Ollersdorf 12 wind turbines Total capacity of 37 MW Completion is expected in 2014/15 financial year After commissioning, EVN‘s generation capacities from renewables will increase to 250 MW

Investments and projects 74 Hydropower plant project in Bulgaria

Gorna Arda 70% EVN stake, 30% NEK (National Electricity Company in Bulgaria) River Arda, South Eastern Bulgaria Total capacity: 120 MW Generation: ~350 GWh p.a. Total investments: up to EUR 500m Start of operations after 2020 (depending on date of construction decision)

Investments and projects 74 Investments and projects 75 Gas supply in Lower Austria

Südschiene

Gänserndorf-Semmering Completion : July 2011 Natural gas pipeline: ~120 km Investments: EUR 114m Westschiene

Westschiene Südschiene Auersthal-Amstetten Completion: May 2013/14 Natural gas pipeline: 143 km Investments: EUR 150m

Map of Lower Austria

Investments and projects 75 Investments and projects 76 Gas supply in Croatia

Concessions to build and operate a natural gas distribution network on the Dalmatian coast Three counties: Zadar, Split and Sibenik Concession period: 30 years Total pipeline length: 1,450 km ~130,000 households Start of construction: April 2011 (Zadar)

Investments and projects 76 International environmental services projects

Projects Currently 9 international waste water treatment projects under construction − Cyprus, Czech Republic, Montenegro, Poland, Romania

Latest commissionings − waste treatment plant Mia Milia/Haspolat in Nicosia, Cyprus − waste treatment plant Budva in Montenegro

Investments and projects 77 Agenda

78 Retrospective adjustments for 2012/13 financial figures

Initial application of IFRS 10–12 in 2012/13 (30.09.2013) Consolidated statement of financial Q. 1–3 2013/14 financial statements and position & operations non recognition of regulatory assets and

previous CONS REG adjusted liabilities as of 30 September 2014 EURm − 2012/13 figures had to be adjusted retrospectively Non-current assets 6,125.1 282.7 -0.7 6,407.2

Current assets 977.0 -90.2 -10.3 876.5 Impact on EVN Group

Equity 3,066.5 22.9 -10.2 3,079.2 − EVN KG and EAA are presented as at equity

Liabilities 4,035.7 169.7 -0.8 4,204.4 consolidated companies whereas STEAG-EVN Walsum is “line by line” consolidated Balance sheet total 7,102.1 192.6 -11.0 7,283.7

− At equity results from companies attributable to EVN Group’s core business are presented in the Revenue 2,755.0 -641.1 -8.0 2,105.9 operating results Share of results from equity accounted investees with operational nature – 95.0 – 95.0 − Absence of regulatory assets and liabilities mainly Results from operating activities (EBIT) 218.5 32.1 -8.4 242.2 influence Netz NÖ GmbH results (non-cash effective)

Financial results -38.1 -33.2 -0.1 -71.5

Group net profit 114.7 1.0 -6.4 109.3

Adjustments according to IFRS 10-12 application 79 Agenda

EVN at a glance Market environment and strategy EVN’s success drivers CSR Outlook Appendix − Management Board − Financial performance 2013/14 − Description of segments − RAG − Investments and projects − Retrospective adjustments of 2012/13 financial figures − Contact details

80 Agenda

81 Contact details

Stefan Szyszkowitz Investor‘s contact point CFO www.evn.at Phone: +43 2236 200-12132 E-mail: [email protected] Fax: +43 2236 200-82132 E-mail: [email protected] EVN AG Headquarters Gerald Reidinger EVN Platz Head of Controlling and Investor Relations 2344 Maria Enzersdorf Phone: +43 2236 200-12698 Fax: +43 2236 200-82698 E-mail: [email protected]

Alexander Sipek Investor Relations Officer Phone: +43 2236 200-12360 Fax: +43 2236 200-82360 E-mail: [email protected] 82

Disclaimer

Certain statements made in this presentation may constitute “Forward-Looking Statements” within the meaning of the U.S. federal securities law. Forward-looking information is subject to various known and unknown risks and uncertainties. These include statements concerning our expectations and other statements that are not historical facts.

The Company believes any such statements are based on reasonable assumptions and reflect the judgement of EVN’s management based on factors currently known by it. No assurance can be given that these forward-looking statements will prove accurate and correct, or that anticipated, projected future results will be achieved.

For additional information regarding risks, investors are referred to EVN’s latest Annual report.