Since the last comprehensive valuation in late 2009 the market environment in Italy, Spain and France has deteriorated in E.ON’s opinion because of the negative effects of the financial and economic crisis.
In the aforementioned markets, the development of electricity and commodity prices is in some cases leading to significantly lower margins and capacity utilisation. As a result, the expected contributions to EBIT by these markets have deteriorated in the medium to long term. Consequently, E.ON sees a need for an impairment charge of approx. € 1.1 billion on goodwill and approx. € 1.5 billion on other assets, mainly in connection with the activities in Italy, Spain and France acquired from Enel/Acciona and Endesa.
The impairments reduce the Group’s net income. There is no impact on adjusted EBIT and adjusted Group net income (assessment basis for dividend payments). Furthermore, the impairments are not cash effective either.
In the third quarter the positive business development of the E.ON Group continued. Adjusted EBIT rose in the first nine months by 9 percent to € 8.0 billion (prior year: € 7.3 billion). Accordingly E.ON is able to confirm the outlook for 2010 with an increase in adjusted EBIT between 0 and 3 percent as well as adjusted Group net income at the prior-year level.
The aforementioned figures are based on the provisional, not yet finally reviewed E.ON Group interim statements as of 30 September 2010 and are therefore subject to change.
In accordance with IAS 36, E.ON is required to carry out impairment tests on a regular basis or for specific reasons.
E.ON AG E.ON-Platz 1 40479 Düsseldorf Deutschland / Germany ISIN: DE000ENAG999 (DAX) WKN: 761440 Listed: Amtlicher Markt in Berlin-Bremen, Düsseldorf, Frankfurt (Prime Standard), Hamburg, Hannover, München and Stuttgart; Eurex - End of ad hoc announcement – October 27, 2010