2011 Annual Report - OTCIQ.com

E.ON generates a significant portion of its EBITDA in very stable
business areas. The overall share of regulated as well as quasiregulated
and long-term contracted business accounted for
50 percent of EBITDA in 2011.
EBITDA1 € in millions 2011 %
Regulated business
Quasi-regulated and long-term contracted
3,721 40
business 900 10
Merchant business 4,672 50
Total 9,293 100
1 Adjusted for extraordinary effects.
Our regulated business consists of operations in which revenues
are set by law and based on costs plus a reasonable return
on capital employed. These revenues are therefore extremely
stable and predictable.
Our quasi-regulated and long-term contracted business consists
of operations in which the revenues have a high degree of
predictability because key determinants (price and/or volume)
are largely set by law or by individual contractual arrangements
for the medium to long term. Examples of such legal
or contractual arrangements include incentive mechanisms
for renewables and long-term power-purchase agreements
for generating capacity.
Our merchant business consists of all those operations that
cannot be subsumed under either of the other two categories.
Generation
Generation’s EBITDA declined by €1,643 million.
Generation
EBITDA
€ in millions
1 EBIT1 2011 2010 2011 2010
Nuclear 272 1,996 25 1,735
Fossil 1,792 1,725 1,061 984
Other/Consolidation 50 36 42 48
Total 2,114 3,757 1,128 2,767
1 Adjusted for extraordinary effects.
CEO Letter
E.ON Stock
Combined Group Management Report
Consolidated Financial Statements
Corporate Governance Report
Supervisory Board and Board of Management
Tables and Explanations
The Nuclear reporting unit’s EBITDA fell by €1.7 billion. Its
operations in Germany were adversely affected in particular by
the nuclear-energy moratorium, the amendment of Germany’s
Nuclear Energy Act (which called for the early, unplanned
shutdown of Unterweser, Isar 1, Krümmel, and Brunsbüttel
nuclear power stations), and the nuclear-fuel tax. Higher
market-based transfer prices for deliveries to Trading in Germany
constituted a positive factor. Nuclear’s EDITDA in
Germany was €2.1 billion below the prior-year figure. Nuclear’s
EBITDA in Sweden rose by €437 million, primarily because
sales volumes and average transfer prices were higher and
provisions were lower than in the prior year.
EBITDA at the Fossil reporting unit rose by €67 million. Higher
earnings in Germany and the United Kingdom resulted mainly
from higher market-based transfer prices relative to the prior
year and from the commissioning of new gas-fired generating
units. Earnings in Italy were lower due to narrower margins.
Earnings in France were adversely affected by negative
market-valuation effects and compensation payments in conjunction
with the transfer of certain operations to Trading.
Renewables
Renewables’ EBITDA increased by €252 million, or 21 percent.
Renewables
EBITDA
€ in millions
1 EBIT1 2011 2010 2011 2010
Hydro 909 755 793 640
Wind/Solar/Other 550 452 295 240
Total 1,459 1,207 1,088 880
1 Adjusted for extraordinary effects.
The Hydro reporting unit’s EBITDA rose by 20 percent to
€909 million, chiefly because of higher market-based transfer
prices for deliveries to Trading. Earnings were adversely
affected by lower output and by lower optimization effects
due to volatile market prices in Spain.
EBITDA at Wind/Solar/Other was significantly higher, mainly
because of a considerable increase in generating capacity.
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