The Mannheim-based energy distribution and service company MVV Energie aims to reduce its administration costs by an annual total of up to Euro 28 million. These cost savings are to be achieved by the 2007/2008 financial year by means of the company's recently launched FOKUS efficiency enhancement programme. This target was announced in Mannheim on Tuesday by Dr. Rudolf Schulten, CEO of the company, which is listed in the SDAX. These measures were crucial to maintaining and strengthening the company's competitiveness in the liberalised energy market. According to the CEO, competitive pressure would "see a further intensification upon the launch of regulation this year, with a decline in profit margins primarily due to the pressure on grid utilisation fees."

In parallel to the profitable growth targeted by the recent realignment of Group strategy in the company's core business fields of electricity, gas, district heating and water, as well as in its growth areas of energy-related services and environmental energy, the efficiency enhancement programme would therefore also enable MVV Energie to achieve significant improvements in its internal cost structures. "The FOKUS programme aims to strengthen our profitability in the interests of our shareholders, to safeguard a high-quality energy supply at attractive prices in line with the market in the interests of our customers and thus to enable the company to provide its employees with long-term job security," argued Dr. Rudolf Schulten.

The efficiency enhancement programme is focused on measures aimed at directly reducing costs in all administrative units of the company. Examples mentioned by Dr. Schulten include the finance and accounting, information technology, personnel management, controlling, building and real estate management and procurement departments, as well as marketing, public relations, sponsoring and business travel. Over the next three years, the company will therefore also be cutting around 200 of the current total of just under 1,800 jobs at the Mannheim Group Head Office. This would be achieved sensitively in the form of part-time employment for older employees, by not filling jobs which become vacant, by concluding dissolution agreements, as well as by means of internal reallocations. The company was in any case bound by a contractual agreement not to make any employees redundant before September 2007. "We intend to secure our independence and autonomy in the increasingly competitive environment," commented Dr. Rudolf Schulten. "To achieve that goal, we have to make ourselves and our structures fit for the future at an early stage."

Mannheim, 5 April 2005