Interview with the Management Board of Energie AG Oberösterreich

The first full fiscal year for the new line-up of the Management Board has come to an end. How satisfied are you with the work of the management team, and the progress made in this fiscal year?

Werner Steinecker: I am very satisfied with the progress and the result of this fiscal year, and with the working relationship between the Members of the Board. The different approaches taken within the Management Board – whether stemming from educational background or situation in life – make for a good working climate and have a positive effect on our stewardship of the company. These are the right conditions for overcoming the challenges that lie ahead in the area of digitalisation as we develop our innovative capacity.

“The first digital Annual Report of Energie AG Oberösterreich is a sign of our flexibility and agility.”

Werner Steinecker

After the outstanding performance of last year, fiscal year 2017/2018 was another very good year. Can things continue in this vein?

Andreas Kolar: Several factors were behind the very good result achieved this fiscal year. Away from the external reality of a very strong economy, we felt the benefit of strategic investments and directions adopted in the past as well as the many internal efficiency projects and the sheer professionalism of our business.

The Group’s strategic priorities in fiscal year 2018/2019 will continue to focus on furthering digitalisation, increasing innovative capacity and improving our focus on customers.

In fiscal terms, we will stick with our tried and trusted policy: a conservative approach, active risk management and a prudent investment strategy that takes account of the financial capabilities of the Group. Of course, the financial outlook for the next fiscal year will be influenced by external factors over which we have no direct control. The most important of these influences will be regulatory developments, the slowdown in the economy and key factors in the energy field, which include the electricity price and water levels.

We will push ahead with internal efforts in the cost management area as well as structural optimisation measures. Overall, we expect profits to fall slightly in 2018/2019 compared to the excellent operating result this year.

“Digitalisation is creating advantages that will benefit us as a company, and you as a customer.”

Andreas Kolar

Energie AG Oberösterreich and its subsidiaries have been ever-present in the media this year. In April, we were somewhat surprised to hear about plans to restructure electricity sales as organised through Linz AG within ENAMO. The main issues for the public, though, are continuing broadband expansion and the planned power line projects. What is the current status of these projects, and how will they impact on Energie AG?

Werner Steinecker: Of course the planned restructuring of the joint electricity sales between Energie AG Oberösterreich and Linz AG within the ENAMO Group was, and remains, a far-reaching outcome for both companies. The decision announced in April was perceived by the workforce and other utilities as a wake-up call in the sense that the decision was driven by changing general conditions and legal developments. It shows that the energy sector is in a volatile environment where you have to respond quickly if you want to stay at the top. This is the challenge we have set ourselves. The planned pooling of our sales units is another factor behind such thinking.

The broadband rollout you mentioned is presenting us with fresh challenges every day – a few years ago, hardly anybody would have imagined we would be entering such a highly competitive market. Today, however, we are one of the big players in Upper Austria in this future-focused field. Even though general conditions are very tough, we are striving to make further inroads through self-funded investment and specific cooperation agreements.

Stefan Stallinger: Alongside changes in the sales area, the signs also point to change in the fields of electricity and heat production. The same goes for the heating networks, which are currently controlled by three different Group companies. A joint new production company will be established to enhance competitiveness, exploit synergy and create interesting jobs. In this way we will guarantee a clean and secure source of heat and electricity generation for customers using hydroelectric power, thermal power stations, wind, photovoltaic and geothermal energy and biomass. Along with grid development, this is a major element that Energie AG is implementing to ensure the energy system of Upper Austria is fit for the challenges of the future.

In the spring, the new federal government presented their vision of energy in the future in the form of the #mission2030 climate and energy framework. What challenges will this spell for Energie AG?

Stefan Stallinger: The #mission2030 framework sets out some ambitious goals. To make these a reality, however, we first need to put the right general conditions in place.

We are committed to the necessary expansion in renewable energy, and we are currently running a whole series of effective projects in this area. The rise in volatile power generation using wind und photovoltaic energy also calls for additional grid expansion as well as greater flexibility to compensate for both short-term and seasonal fluctuations in power generation and load. We believe there are opportunities for the future as regards integrated energy and storage projects.

“The utility sector is facing major challenges. With the energy transition putting the entire system to the test, we need to do our homework in the field of digitalisation.”

Stefan Stallinger

Surely these factors will affect the company as a whole financially as well as practically?

Andreas Kolar: Obviously, we face considerable investment challenges in this environment. As a public joint stock company with different perspectives among our stakeholders, we always have to weigh up very carefully what investments we can and should make, and when to make them. As a capital-intensive group, however, it is crystal clear to us that investment is essential if we are to carry on guaranteeing supply reliability in future, give appropriate consideration to sustainability and generate the returns we want and need.

The renewed award by Standard & Poor’s of the excellent rating “A with stable outlook” is external confirmation of the high standard of care we have exhibited and the reasonableness of past and planned decisions.

This year there were also big changes to the Supervisory Board, the Group’s control committee. Has this influenced the working relationship with the Management Board?

Werner Steinecker: I would like to express my regret at the departure of our former Supervisory Board chairman DI Gerhard Falch, who stepped down for health reasons. I wish him all the best! Typically for Upper Austria, though, we soon found an equally competent and judicious successor. With long-serving Supervisory Board member Dr. Michael Strugl at the helm, the seamless continuation of a management system that has served the Management Board very well in the past is assured, while the oversight and support of the Supervisory Board is guaranteed. For this, I would like to thank all members of the Supervisory Board on behalf of the company.

Naturally, I would also like to extend particular thanks to the company’s workforce and managers, who over the past year have continued to make it, I would almost say, easy for the Management Board to run the company. As well as thanking people inside the company, I have to thank the many loyal and new customers and partners of Energie AG who showed us their trust over this past year. We will be happy to remain a partner to them in the future.