MVV: robust earnings in difficult market climate

MVV Director Dr. Hansjörg Roll: “With #climate positive, we are on the right course for more climate protection and greater independence from fossil energy sources.”

“Never before have the objectives of our Mannheim Model, with which we intend to become climate neutral by 2040 and #climate positive from then on, been as appropriate or as important as right now”, stressed Dr. Hansjörg Roll, a member of the Executive Board at the Mannheim-based energy company MVV (ISIN: DE000A0H52F5; WKN: A0H52F) upon publication of the results for the first nine months of the 2022 financial year (1 October 2021 – 30 June 2022). At the same time, he called for “Germany to significantly speed up the energy turnaround and become independent of fossil-based energy generation.” This was clearer than ever due to the war in Ukraine, with all of its far-reaching implications for the international energy markets. The wholesale market price of gas alone rose year-on-year by 250 percent in the period under report. Electricity prices on the energy exchange also more than doubled.

Given the increase in wholesale prices and due to higher electricity volumes, MVV’s sales also rose to around Euro 3.7 billion in the first nine months of the current financial year (previous year: Euro 3.1 billion). “We acted early to take extensive forward-looking measures. These have enabled us so far to keep any price adjustments for our customers within limits despite the rally in prices on the energy markets”, underlined Dr. Hansjörg Roll and added: “In view of the challenging current situation in the energy industry and the rise in procurement costs, we will nevertheless see significantly higher average prices for electricity and gas in 2023.” This means that prices for the basic supply of electricity and gas will rise significantly at MVV as well in the year ahead.

Despite the difficult market climate, MVV’s operating earnings in the first nine months of the current financial year were slightly ahead of the previous year’s level. Positive earnings contributions came above all from the trading activities at MVV Trading, a strong performance in the environmental energy business, higher wind volumes and the extension in the renewable energies portfolio. Taking additional account of one-off items due to changes in MVV’s investment portfolio, adjusted EBIT showed significant growth of 21 percent to Euro 320 million in the period under report.

Forecast operating business performance in 2022 confirmed
According to Dr. Hansjörg Roll, MVV’s financial performance in the first nine months of the current financial year showed that “MVV is still on the right track with its ‘#climate positive’ approach”. Based on its business performance to date, the energy company can therefore confirm its earnings forecast for the 2022 financial year. From an operating perspective, i.e. excluding one-off items, MVV expects its adjusted EBIT to be moderately higher than in the previous year.

MVV supports customers in saving energy
However, the further consequences of the war in Ukraine and its implications for the already volatile energy and procurement markets could only be forecast to a limited extent, cautioned Dr. Hansjörg Roll. “Gas storage facilities will have to be gradually filled if we are to cope in the coming autumn and winter”, he explained. To tackle this great challenge together, the catchword was this: save energy.

MVV has therefore launched the campaign “#MonnemSpartEnergie” (Mannheim Saves Energy) and is providing consumers with tips as to how they can already reduce their energy consumption with some easily implemented measures. To this end, the energy company is cooperating with the Mannheim Climate Protection Agency. Dr. Hansjörg Roll also announced the introduction of a gas bonus for Mannheim and the region, which consumers receive if they actively reduce their gas consumption.

Mannheim Model makes major contribution to climate action and energy independence
Dr. Hansjörg Roll: “In the longer term, expanding renewable energies and converting district heat to climate-neutral sources are absolutely crucial for our energy independence. In our Mannheim Model, we are therefore already working at full steam on the heat turnaround.” By 2030, MVV intends to make district heat in Mannheim and the region green and thus supply two thirds of households with climate-friendly heat. Not only that: From 2035, the energy company will also make no further use of fossil-based natural gas there.
And MVV is also accelerating the electricity turnaround within the Mannheim Model by consistently expanding renewable energies in Germany and abroad. Here, the energy company has combined its two project development companies, Juwi and Windwärts, into one even more effective unit within the MVV Group, namely JUWI GmbH. Furthermore, MVV is continually expanding its own generation from renewable energies. In the third quarter of 2022, it launched operations at Thaden Windfarm and Heudorf Solar Park. This means that MVV now has installed renewable energies capacities of almost 600 megawatts.

Dr. Hansjörg Roll: “All our actions are based on the conviction that our #climate positive strategy is the right course for climate protection and that expanding renewable energies is the key to making us independent of fossil energy supplies from Russia.”

The complete quarterly statement is available online at www.mvv.de/investors.