Agreement reached with Gazprom on price adjustments to long-term gas supply contracts
Non-recurring effect improves E.ON’s outlook for financial year 2016
Negotiations between Uniper, the fully-owned E.ON subsidiary, and Gazprom on price adjustments to long-term gas supply contracts have led to an agreement earlier than anticipated. The agreement resolves pending arbitration proceedings between the companies.
The agreement will enable E.ON to release some of the provisions recorded in prior years, resulting in a non-recurring positive EBITDA effect of about €380 million in the first quarter of 2016. The release of the remaining provisions, made in several years, will result in cash outflow of circa € 800 million probably in the second quarter.
The non-recurring positive effect serves to increase E.ON’s forecast range for its 2016 EBITDA from between €6.0 and €6.5 billion to between €6.4 and 6.9 billion.1 Similarly, instead of underlying net income of €1.2 to €1.6 billion, E.ON now expects the range to be between €1.5 and €1.9 billion.
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- End of ad-hoc-announcement - 29. March 2016