Annual General Meeting of Mannheim energy company - MVV CEO Dr. Rudolf Schulten relies on environmental and climate protection

MVV Energie AG, the Mannheim-based energy company which is listed in the SDAX, sees environmental and climate protection as harbouring enormous growth and investment opportunities and intends to exploit these consistently in the coming years. At this year's Annual General Meeting, held in Mannheim on Friday, Dr. Rudolf Schulten, CEO of the municipal utility group, announced that the company would be increasing its investments in projects aimed at saving energy and boosting energy efficiency, as well in the expansion of environmentally-friendly district heating and the use of renewable energies and new energy technologies. "With their local markets and decentralised strategies, municipal utility companies have especially good access to new and highly promising growth opportunities," remarked Dr. Schulten.

With its integrated energy and climate programme for the period to 2020, the German Federal Government had set ambitious climate protection and energy savings targets. At the same time, the European Commission was also calling for the share of renewable energies to be increased and for improved energy efficiency. According to the CEO of MVV Energie, the problem of pollution was especially great in cities and conurbations due to their concentration of industrial and commercial companies, population densities and traffic volumes. It was therefore in precisely these areas, he continued, that the most promising opportunities for effective climate protection were to be found.

MVV Energie was relying in particular on the expansion of cogeneration, district heating and renewable energies. According to the CEO, 20 percent of the electricity generated at the company's own power plants already stemmed from renewable energies, and a further 27 percent came from cogeneration. These shares were far above the national aver-ages, namely 14 percent for renewable energies and 9 percent for cogeneration. "We will make targeted efforts to further extend this head start", added Dr. Schulten. At the same time, the company is also playing a pioneering role in a cooperation project in the Rhine/Neckar metropolitan region aimed at more than doubling the share of the overall heating supply attributable to district heating from its current level of 13 percent to around 29 percent.

Prior to consolidation, the Group's municipal utility shareholdings in Germany and district heating shareholdings in Poland and the Czech Republic generated combined sales of Euro 311 million (previous year: Euro 263 million) and operating earnings (EBIT) of Euro 48 million in the 1st quarter of 2007/08, compared with Euro 30 million in the previous year's period.

The CEO added that in its core business MVV Energie would also be focusing in the next two years and as part of its value-based growth strategy on increasing the cost efficiency of its proprietary operations and administration, on acquiring additional shareholdings and on tapping additional synergy potential within the municipal utility group. "Not only that, we also aim to achieve profitable growth in our successful high-growth fields of environmental energy and energy-related services both organically and by means of new investments and acquisitions, as well as exploiting new market opportunities", added Dr. Schulten. The proceeds of around Euro 228 million from the capital increase executed in October 2007 would also be channelled in this direction.

Like all companies operating in the heating and natural gas businesses, MVV Energie suf-fered a downturn in sales volumes in the past 2006/07 financial year (1.10.2006 - 30.9.2007) as a result of the very mild winter. The group nevertheless posted year-on-year sales growth of 4 percent to Euro 2.3 billion. The operating earnings (EBIT) reported in the consolidated financial statements of MVV Energie AG, which are compiled in line with international accounting standards, amounted to Euro 215 million. Following adjustment for non-cash valuation items in connection with IAS 39, MVV Energie generated EBIT of Euro 199 million, compared with Euro 201 million in the previous year.

Like all companies operating in the heating and natural gas businesses, MVV Energie suf-fered a downturn in sales volumes in the past 2006/07 financial year (1.10.2006 - 30.9.2007) as a result of the very mild winter. The group nevertheless posted year-on-year sales growth of 4 percent to Euro 2.3 billion. The operating earnings (EBIT) reported in the consolidated financial statements of MVV Energie AG, which are compiled in line with international accounting standards, amounted to Euro 215 million. Following adjustment for non-cash valuation items in connection with IAS 39, MVV Energie generated EBIT of Euro 199 million, compared with Euro 201 million in the previous year.

Annual net income after minority interests rose from Euro 50 million in the previous year to Euro 109 million. This jump in earnings was largely due to deferred tax income of Euro 46 million reported in the 2006/07 consolidated financial statements in connection with the 2008 corporate tax reform. Moreover, the positive free cash flow of Euro 119 million - in the previous year this figure was still negative to the tune of Euro 52 million - provides "an indication of our company's robust earnings and financial strength".

The distribution of a dividend to shareholders is based on the separate 2006/07 annual financial statements of MVV Energie compiled in accordance with the German Commercial Code (HGB). In these, the company reported an annual net surplus of Euro 68 million, as against Euro 58 million in the previous year. "Our shareholders also stand to benefit from our positive earnings performance", stated Dr. Schulten to around 1,800 shareholders and guests at the Rosengarten Congress Center in Mannheim. The Supervisory Board and Executive Board proposed an unchanged dividend of Euro 0.80 per share for approval by the Annual General Meeting. However, the higher number of shares with dividend entitle-ment following the successful capital increase in October 2007 means that MVV Energie will be distributing a total of Euro 52.7 million for the 2006/07 financial year, and thus Euro 8.1 million more than in the previous year.

Mannheim, 14 March 2008