Due to the termination of the cooperation in electricity sales with LINZ AG für Energie, Telekommunikation, Verkehr und Kommunale Dienste, the sales activities of the Energie AG Group for electricity, gas, heat and telecommunications will be bundled in the newly founded Energie AG Oberösterreich Vertrieb GmbH in the second half of the 2018/2019 fiscal year. Energie AG Oberösterreich Vertrieb GmbH & Co KG and the sales divisions of Energie AG Oberösterreich Power Solutions GmbH, Energie AG Oberösterreich Wärme GmbH and Energie AG Oberösterreich Telekom GmbH were contributed, merged or spun off to this Group company with retroactive effect from 1 October 2018. The associated organisational change became effective in the Group on 1 April 2019 after the conclusion of the reporting period. True to the motto of “Everything from a single source”, an even better focus on specific customer needs, for example in the form of bundled products, will therefore be achieved.

In addition, with retroactive effect from 1 October 2018, the generation activities in the Group were bundled and the heat generation facilities integrated into the Group company Energie AG Oberösterreich Kraftwerke GmbH, which will be renamed to Energie AG Oberösterreich Erzeugung GmbH. The organisational implementation of this project, which came into effect on 1 May 2019, ties in with the bundling of sales activities for electricity, gas, heating and telecommunications and enables synergy effects and production efficiency enhancements.

In the second half of the 2018/2019 fiscal year, it is also planned to pool the Czech water and heating activities of the Energie AG Group. For this reason, the national holding company was split off from the heating business unit and merged with the Czech affiliates of Energie AG Oberösterreich Wasser GmbH. In this context, Energie AG Teplo Bohemia s.r.o. will be merged with ENERGIE AG BOHEMIA s.r.o. retroactively with effect as of 1 October 2018. In organisational terms, cooperation in the water and heat unit in the Czech Republic was implemented as of 1 April 2019. Given that several of the water and heating companies operate in the same or neighbouring regions, a synergy project has been launched. The aim is to further optimise market activities and intensify cooperation between water and heating companies.

In terms of the price development on the European electricity markets, continued high volatility at the current level can be expected for the second half of the 2018/2019 fiscal year. In the second half of the year, stable development of the natural gas procurement prices, which dropped in the reporting period, is anticipated at the existing level. Electricity retail prices for end users and commercial customers will also be kept constant in the second half of the year in conformity with the conditions of the price guarantee valid until 1 January 2020.

In the second half of the 2018/2019 fiscal year, the Heat business unit will concentrate on further expansion of the district heating project in Gmunden. A further major focus will be acquiring new customers in the existing supply area.

In the Grid Segment, the statutory environment for the current fiscal year can again be judged to be stable. The parameters for the current electricity regulatory period have been defined for the next five years. The general economic environment for the natural gas grid was defined on 1 January 2018 in the third regulatory period, however, the Austrian Federal Economic Chamber and the Federal Chamber of Labour have objected to the stipulations made by the regulatory authority. A decision on how to respond to these objections is still outstanding. However, the design of the electricity regulatory period was completed without any objections in the current year, so that, viewed holistically, a stable economic environment for the grid sector can continue to be assumed.

For the second half year, the Waste Management Segment anticipates good capacity utilisation at its incineration plants due to the high available volume of thermally recyclable waste. The protection of the plants against impurities and the search for new, innovative disposal solutions for these impurities remain central topics. Price developments on the waste disposal market continue to be viewed positively.

In the Water Segment, stable business development without significant changes in the contract portfolio is anticipated for the second half of the 2018/2019 fiscal year.

The focus of the planned Federal Broadband Strategy 2030 is the objective of gigabit connections for all Austrian households from 2025 onwards. To this end, the federal government is planning both legal measures and subsidies. The resulting opportunities will be actively pursued by Energie AG's Telecommunications business area. In addition, fibre optic expansion will be continued in the second half of the 2018/2019 fiscal year in areas where a subsidy has already been granted or the required number of customer contracts has been concluded. In the future, Telekom GmbH's fibre optics division will focus on the role of a wholesale provider for the Group's own sales organisation and other providers.

In the second half of the 2018/2019 fiscal year, the focus within the Energie AG Group will be on the organisational implementation of structural changes within the Group and the realisation of initial synergies from this. The specific focus will be on continuing to improve customer orientation, for example, with bundled products in the electricity, gas, heating and telecommunications business. The ongoing implementation of the digitalisation strategy and consistent cost management in all areas of the Group complement the strategic orientation. Against the backdrop of sales reorganisation, and the challenges from the market environment and regulatory developments, a good operating result is expected for the 2018/2019 fiscal year as a whole.

Linz, 29 May 2019

The Management Board of Energie AG Oberösterreich

Chief Executive Officer
DDr. Werner Steinecker MBA
Chairman of the Management Board

Dr. Andreas Kolar

Member of the Management Board

Dipl.-Ing. Stefan Stallinger MBA

Member of the Management Board