2011 Annual Report - OTCIQ.com

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104 Notes E.ON Share Performance Plan Issues from 2011 In 2011, virtual shares (“Performance Rights”) were granted under the sixth tranche of the E.ON Share Performance Plan with a target value at issuance of €22.43. At the end of its term, each Performance Right is entitled to a cash payout linked to the final E.ON share price established at that time. Under the modified terms of the plan applicable to future tranches, the number of rights to be settled at the end of the term is now governed by the degree to which specific corporate financial measures are achieved over the term. The benchmark is the return on capital, expressed as the return on average capital employed (“ROACE”) compared with the weighted-average cost of capital (“WACC”), averaged over the unchanged four-year term of the new tranche. At the same time, starting with the sixth tranche, the maximum payout was further limited to 2.5 times the target value originally set. 60-day average prices are used to determine both the target value at issuance and the final price in order to mitigate the effects of incidental, short-lived price movements. The plan contains adjustment mechanisms to eliminate the effects of interim corporate actions. The 60-day average of the E.ON share price as of the balance sheet date is used to measure the fair value of the rights. A provision of €7.9 million was recognized. The expense for the fiscal year was €7.9 million. (12) Other Information German Corporate Governance Code On December 12, 2011, the Board of Management and the Supervisory Board of E.ON AG made a declaration of compliance pursuant to Section 161 of the German Stock Corporation Act (“AktG”). The declaration has been made permanently and publicly accessible to stockholders on the Company’s Web site (www.eon.com). Fees and Services of the Independent Auditor During 2011 and 2010, the following fees for services provided by the independent auditor of the Consolidated Financial Statements, Pricewaterhouse Coopers (“PwC”), Aktien gesellschaft, Employees During 2011, E.ON employed an average of 80,859 persons (2010: 85,509), not including an average of 2,238 apprentices (2010: 2,261). The employees of the U.S. Midwest market unit are no longer reported in the table (see Note 4). The breakdown by segment is shown below: Employees1 2011 2010 Generation 10,762 11,075 Renewables 1,777 1,753 Gas 3,192 3,168 Trading 1,020 1,079 Germany 21,566 21,278 Other EU Countries 33,489 38,004 Russia 4,894 4,713 Group Management/Other2 4,159 4,439 Total 80,859 85,509 1 Figures do not include board members, managing directors, or apprentices. 2 Includes E.ON IT Group. Wirtschafts prüfungs gesellschaft, (domestic) and by companies in the international PwC network were recorded as expenses: Independent Auditor Fees € in millions 2011 2010 Financial statement audits 27 30 Domestic 18 20 Other attestation services 23 25 Domestic 19 18 Tax advisory services 1 1 Domestic 1 – Other services 1 3 Domestic 1 3 Total 52 59 Domestic 39 41
The fees for financial statement audits concern the audit of the Consolidated Financial Statements and the legally mandated financial statements of E.ON AG and its affiliates. Fees for other attestation services concern in particular the review of the interim IFRS financial statements. Further included in this item are project-related reviews performed in the context of the introduction of IT and internal control systems, due- diligence services rendered in connection with acquisitions and disposals, and other mandatory and voluntary audits. (13) Earnings per Share The computation of basic and diluted earnings per share for the periods indicated is shown below: Earnings per Share € in millions Income/Loss (-) from continuing 2011 2010 operations -1,875 7,117 Less: Non-controlling interests Income/Loss (-) from continuing operations (attributable to shareholders -358 -428 of E.ON AG) -2,233 6,689 Income/Loss (-) from discontinued operations, net Net income/loss (-) attributable to 14 -836 shareholders of E.ON AG -2,219 5,853 in € Earnings per share (attributable to shareholders of E.ON AG) from continuing operations -1.17 3.51 from discontinued operations 0.01 -0.44 from net income/loss (-) -1.16 3.07 Weighted-average number of shares outstanding (in millions) 1,905 1,905 CEO Letter E.ON Stock Combined Group Management Report Consolidated Financial Statements Corporate Governance Report Supervisory Board and Board of Management Tables and Explanations Fees for tax advisory services primarily include advisory on a case-by-case basis with regard to the tax treatment of M&A transactions, ongoing consulting related to the preparation of tax returns and the review of tax assessments, as well as advisory on other tax-related issues, both in Germany and abroad. Fees for other services consist primarily of technical support in IT and other projects. List of Shareholdings The list of shareholdings pursuant to Section 313 (2) HGB is an integral part of these Notes to the Financial Statements and is presented on pages 159 through 173. The computation of diluted earnings per share is identical to that of basic earnings per share because E.ON AG has issued no potentially dilutive ordinary shares. 105
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2011 Annual Report
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Contents 2 CEO Letter 4 E.ON Stock
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Europe’s energy markets are conso
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Dividend At the 2012 Annual Shareho
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Global Units We manage all our oper
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How will we achieve all this? The f
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Top performance requires efficient
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The Energy Roadmap 2050 adopts a sc
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Macroeconomic Environment In 2011,
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Energy Prices Four main factors dro
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Attributable Generating Capacity Th
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The Russia unit generated about 94
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Gas Sales On a consolidated basis,
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Sales Our sales rose by 22 percent
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Sales at the UK regional unit decli
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E.ON generates a significant portio
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Distribution Networks’ EBITDA dec
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and coal-fired power stations. Of t
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Analyzing Value Creation by Means o
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Cash Flow and Financial Position E.
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In addition to our DIP, we have a
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E.ON AG’s Earnings, Financial, an
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Employees HR Strategy The knowledge
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Workforce Figures At year-end 2011,
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Technology and Innovation In 2011,
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The ERC was founded in 2006. Its mi
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Risk Management and Insurance E.ON
Page 55 and 56: Strategic Risks Our business strate
Page 57 and 58: E.ON is building a hard-coal-fired
Page 59 and 60: waste.” The draft legislation men
Page 61 and 62: In 2012, Sweden will introduce a ne
Page 63 and 64: Due to lower commodity prices and u
Page 65 and 66: We anticipate Renewables’ earning
Page 67 and 68: Opportunities We conduct a bottom-u
Page 69 and 70: Audit Opinion According to § 322 A
Page 71 and 72: CEO Letter E.ON Stock Combined Grou
Page 75 and 76: Additional information on the State
Page 79 and 80: Business Combinations Business comb
Page 81 and 82: Newly created goodwill is allocated
Page 83 and 84: Subsequent costs arising, for examp
Page 85 and 86: Instruments commonly used are forei
Page 87 and 88: future exercise price. This amount
Page 89 and 90: Contingent liabilities are possible
Page 91 and 92: (2) New Standards and Interpretatio
Page 93 and 94: and joint operations. The provision
Page 95 and 96: The amended standard also contains
Page 97 and 98: Russian Federation. The proceeds fr
Page 99 and 100: The gains on the disposal of invest
Page 101 and 102: The decrease in tax expense by €3
Page 103 and 104: Of the deferred taxes reported, a t
Page 105: Stock Appreciation Rights of E.ON A
Page 113 and 114: Of this total, an amount of €160
Page 115 and 116: (15) Companies Accounted for under
Page 117 and 118: The individual impaired receivables
Page 119 and 120: (20) Additional Paid-in Capital As
Page 121 and 122: Description of the Benefit Obligati
Page 123 and 124: Description of Plan Assets Defined
Page 125 and 126: Taking into account periodic additi
Page 127 and 128: (25) Miscellaneous Provisions The f
Page 129 and 130: Advance payments made to other wast
Page 131 and 132: At year-end 2011, the following EIF
Page 133 and 134: Construction grants of €2,857 mil
Page 135 and 136: In Sweden, owners of nuclear facili
Page 137 and 138: Competition in the gas market and i
Page 139 and 140: Pursuant to the information availab
Page 143 and 144: The fair value of shareholdings in
Page 145 and 146: The following two tables illustrate
Page 147 and 148: Risk Management Principles The pres
Page 149 and 150: A sensitivity analysis was performe
Page 151 and 152: Virtually all of the investments in
Page 153 and 154: Under IAS 24, compensation paid to
Page 155 and 156: Net book gains in 2011 decreased by
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CEO Letter E.ON Stock Combined Grou
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(34) Compensation of Supervisory Bo
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Notes (36) List of Shareholdings Pu
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In addition to the Company’s peri
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The Supervisory Board has establish
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and the Consolidated Financial Stat
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Compensation of the Members of the
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The Supervisory Board, at its discr
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the E.ON Group’s ROCE and prior-y
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Compensation of the Members of the
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The remaining other compensation of
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In addition, the Board of Managemen
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We examined the Board of Management
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Klaus Dieter Raschke Chairman of th
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At the Board of Management’s disc
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Further information about financial
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Assessment After companies have doc
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Glossary of Financial Terms Actuari
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Prepayments and accrued income Line
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Financial Calendar May 3, 2012 2012
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2011 Annual Report - OTCIQ.com

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