2003 annual results for the Atel Group

Aare-Tessin Ltd. for Electricity (Atel) posted excellent results for 2003, setting new records for sales, turnover and profits to secure its position as a leading energy services provider in Switzerland.

Aare-Tessin Ltd. for Electricity (Atel)’s excellent results reflect success in all business fields and regions of the energy business.  Energy Services business held its own in a difficult environment. The Atel Group’s 8,100 staff from 51 nations have helped turn the company into the leading Swiss energy company with a European focus. Almost 90% of Atel’s energy turnover was generated outside Switzerland in 2003, principally in liberalised markets. The company’s success stemmed from trading, sales and supply. Atel firmly believes that having its own strong generation facilities is a crucial success factor in trading and sales. 

Consolidated turnover grew to CHF 5.3 billion The Atel Group set new records for turnover and earnings in 2003, with consolidated net turnover rising 42.8 % to CHF 5.3 billion. The companies acquired in 2002 and 2003 in the Czech Republic and Hungary played a notable role in achieving this growth. Earnings before interest and taxes (EBIT) grew by around 40 % to CHF 360 million and Group profit rose by 60 % to CHF 272 million. Generated cash flow of CHF 520 million was 6% higher than in 2002. Investments totalled CHF 605 million in 2003 or 33% more than a year ago. The Board of Directors proposes to increase the dividend by 10% to CHF 22 per registered share.

Energy business: success in all regions The Energy segment is based on three divisions, namely generation, trading and sales.  Atel fared extremely well in this segment in 2003 by increasing turnover 70 % to CHF 3.8 billion. The companies acquired in 2002 and 2003 in the Czech Republic and Hungary accounted for around CHF 1 billion of this figure. One third of turnover was generated in Southern Europe, around 30% in Central/Eastern Europe and 14% in Switzerland. Pan-European trading accounted for 22% of turnover. The Energy segment posted earnings of CHF 327 million (+ 55%) at year-end.  Electricity sales also saw strong growth, rising by at least 70% to 68.5 TWh in traditional physical business. Atel also processed standardised transactions of 67 TWh worth CHF 2.7 billion last year, but does not include them in its turnover and sales figures. 

Targeted expansion of production Power generation was a major pillar of business success last year. Atel doubled its holding in the ECKG power station to 89% which increased its power generation capacity in Hungary and the Czech Republic to 702 MW. Atel also expanded its own generation capacities in Italy, with 1,400 MW already available as a result of Atel increasing its energy interest in Edipower to 20%. Two of its own gas-combi power stations will become operational in mid-2004. In Switzerland, voters removed the uncertainty about operating nuclear power stations by rejecting nuclear power proposals. Atel has power station capacity of 1,590 MW in Switzerland. 

Profit in the Energy Services segment Despite very tough economic environments in Germany and Switzerland, the Energy Services segment reported positive results. The GAH Group in Heidelberg and Atel Installationstechnik Group in Zurich together generated turnover of CHF 1.5 billion which represents growth of 5%. The strong euro plus the power station engineering and industrial/plant construction areas made a positive contribution to turnover. Segmental results fell from CHF 26 million in 2002 to CHF 12 million in 2003. 

Outlook for 2004 After a period of heavy expansion, Atel will concentrate on financial and organisational consolidation in 2004 under the new CEO Giovanni Leonardi. Internal growth will be the main focus, particularly strengthening funding power and balance sheet structures. Barring any exceptional events, Atel expects net turnover and operating results to rise at around the same levels as 2003 throughout the Group.

Aare-Tessin Ltd. for Electricity Corporate Communications