Sales and EBIT rise by 17 percent in first half - Company relies on high-growth environmental and climate protection market

The Mannheim-based company MVV Energie (ISIN: DE000A0H52F5, WKN: A0H52F) aims to further exploit its opportunities for growth by stepping up its investments in energy-saving projects, improving energy efficiency, expanding the supply of environmentally-friendly district heating and working with renewable energy forms. At the presentation of the earnings for the first half of the current 2007/08 financial year (1 October - 31 March 2008) in Mannheim on Friday, Dr. Rudolf Schulten, CEO of the energy company, which is listed in the SDAX, stressed that "in view of the climate protection efforts on the part of the Federal Government and the European Commission, MVV Energie is relying - as a municipal utility network with our local markets and our competition-based strategy - on the high-growth market for environmental protection". Today already, the company generated 20 percent of its electricity from renewable energy sources and a further 27 percent using cogeneration. "We are thus way ahead of the German average of 14 percent and 9 percent respectively."

The external sales of the MVV Energie Group rose by Euro 201 million, or 17 percent, to Euro 1.4 billion in the first six months of the current financial year. According to Dr. Schulten, this growth was mainly driven by the electricity, district heating and value-added services segments. "Particularly worthy of note is the 30 percent growth in electricity sales which were able to report notwithstanding the tangible increase in competition in the electricity market. We achieved this in part by expanding our nationwide sales." Operating earnings (EBIT) before IAS 39, i.e. adjusted to exclude non-cash income of Euro 44 million from the valuation of energy trading transactions (futures) at fair value as of the reporting date, also rose by 17 percent over the same period to reach Euro 194 million.

Following the downturn in turnover seen in the previous year due to the mild winter, MVV Energie is thus fully back on its growth course. With a view to the financial year as a whole, the CEO therefore expects "we will achieve double-digit growth in both sales and EBIT before IAS 39 compared with the previous year".

The company also reported substantial improvements in its other key earnings figures in the first half of 2007/08. Earnings before interest, taxes, depreciation and amortization (EBITDA) rose year-on-year by 35 percent to Euro 310 million, while earnings before taxes (EBT) increased by 69 million to Euro 200 million. The net surplus for the period after minority interests increased from Euro 59 million to Euro 120 million. Earnings per share thus rose from Euro 1.05 to Euro 1.85, even though the weighted half-year average number of shares rose from 55.8 million to 64.7 million due to the capital increase in 2007. These earnings figures include the positive impact resulting from the application of IAS 39.

All companies within the MVV Energie Group reported improvements. The municipal utility shareholdings and foreign district heating shareholdings posted sales of Euro 663 million prior to consolidation in the first half of 2007/08 compared with Euro 572 million in the previous year and operating earnings of Euro 113 million, as against Euro 84 million in the same period in the previous year.

Sales at Stadtwerke Kiel rose by 21 percent to Euro 242 million between October and March, while operating earnings (EBIT) improved by Euro 11 million to Euro 39 million. Over the same period, Energieversorgung Offenbach increased its sales by 12 percent to Euro 212 million and its EBIT by Euro 4 million to Euro 33 million. Sales at Stadtwerke Solingen grew by 13 percent to Euro 61 million, while EBIT simultaneously rose by Euro 3 million to Euro 9 million. Stadtwerke Ingolstadt posted sales growth of 7 percent to Euro 5 million and EBIT growth of Euro 3 million to Euro 9 million. Sales at Köthen Energie increased by 13 percent to Euro 9 million, while its EBIT grew by 5 percent to Euro 1.5 million.

The Czech subgroup reported the strongest growth of all companies. In the first half of 2007/08, sales rose by Euro 21 million to Euro 63 million and operating earnings (EBIT) grew by 56 percent to Euro 18 million. According to the CEO of MVV Energie, this strong growth was attributable both to increased district heating turnover due to weather condi-tions and to initial contributions from the new shareholdings in Teplárna Liberec and the district heating systems in the neighbouring towns of Litomerice, Louny and Mimon. The comparability of the sales and earnings performance of the Polish subgroup with the first half of the previous year is impaired by the transitional consolidation of the shareholding in Bydgoszcz (KPEC) from July 2007 onwards. Due to difficult underlying conditions, the re-structuring measures have not led to any sustainable economic success. "We expect to be able to complete the planned sale of the KPEC shareholding, as well as the exit since re-solved from the entire Polish business, before the end of the current 2007/08 financial year," commented Dr. Schulten.

Mannheim, 16 May 2008

Key Figures of the MVV Energie Group ¹
1 October 2007 - 31 March 2008

Euro million	2007/2008	2006/2007	% change
Sales 2	1 412	1 211	+ 17
EBITDA	310	229	+ 35
EBITA	238	159	+ 50
EBIT	238	159	+ 50
EBIT before IAS 39	194	166	+ 17
EBT	200	118	+ 69
Net surplus for the period	134	70	+ 91
Net surplus after minority interests	120	59	+ 103
Earnings per share 3 (Euro)	1.85	1.05	+ 76
Cash flow before working capital and taxes	150	162	- 7
Cash flow before working capital and taxes per share 3 in Euro	2.69	2.97	- 9
Total assets (as of 31.3.2008 / 30.9.2007)	3 508	3 278	+ 7
Equity (as of 31.3.2008 / 30.9.2007)	1 218	914	+ 25
Investments 4	93	132	- 30
Number of employees 5	6 295	6 864	- 8
1 in accordance with International Financial Reporting Standards (IFRS)
2 excluding electricity and natural gas tax
3 increase in number of shares (weighted half-year average) from 55.8 million to 64.7 million    as a result of capital increase
4 investments in intangible assets, property, plant and equipment, investment property, as well as    payments for the acquisition of fully and proportionately consolidated companies and other    financial assets
5 including external personnel at Mannheim waste-to-energy plant of MVV Energie AG