Dear shareholders!

The current economic and financial crisis which seemingly peaked in the first half of 2009 for the time being dramatically demonstrates the fatal consequences of short-sighted decisions and profit maximisation at any price on the overall economy, but also on the stability of the economic system. Under these conditions, EVN not only reacted to the new circumstances successfully and in a timely manner, but also displayed courage to maintain its long-term strategy and realise selected growth projects. For this reason, these crucial growth projects and the related objectives are introduced at the beginning of this annual report.

Let us now discuss the most important developments in the 2008/09 financial year. Thanks to the positive growth in both segments, we generated a revenue increase of 13.8%, to EUR 2,727.0m. In the Energy segment, this was due to the higher electricity sales volumes in Macedonia and increased heating sales volumes in Austria and Bulgaria as well as upward price adjustments necessitated by higher primary energy prices in previous periods. The Environmental Services segment achieved a significant increase in revenue despite the delay in implementing projects resulting from the changed financing situation. On balance, revenue development in the past financial year can be considered as quite satisfactory.

The high procurement prices for electricity purchases and primary energy which reached record levels in the summer of 2008, first had a considerably negative impact on the development of EVN’s operating results in the period under review due to forward contracts. Nevertheless, EBITDA totalled EUR 373.4m and EBIT EUR 175.2m, both slightly above the previous year. In contrast, the financial results could not match the level of the previous year. This was partly due to the decline in the income from EVN investments related primarily to the lower profit contribution from Rohöl-Aufsuchungs AG, in turn caused by price decreases for crude oil and natural gas. Other financial results rose on the basis of the latest developments on global financial markets significantly, but remained slightly negative. On balance, financial results fell 26.2%, to EUR 50.8m. Accordingly, the profit before income tax decreased by 4.0% to EUR 226.0m, and earnings per share totaled EUR 1.09, down 4.8% from the 2007/08 financial year. Despite this slight earnings decline, we will propose an unchanged dividend of EUR 0.37 per share at the upcoming 81st Annual General Meeting on January 21, 2010. In this way, we want to ensure the continuity of our dividend policy and also enable us to finance the further growth of your company.

The objectives of our investment strategy are clearly defined: we want to generate 40 - 60% of total electricity sales volumes from our own power-generating facilities or long-term purchasing rights. At present, the coverage ratio is 17.8%, illustrating the extent to which investments will be required. During the reporting period, important milestones were achieved in this direction. Work on construction of the hard coal fired power plant in Duisburg-Walsum, Germany in cooperation with Evonik Steag GmbH is before start-up. After being put into operation in 2010, the proportional annual power generation of EVN will amount to 1,600 GWh. The Energy Concept for the Lower Austrian Central Region is also being implemented according to plan on the premises of EVN’s facility in Dürnrohr/Zwentendorf, where several projects featuring a total investment volume of EUR 200m have almost been entirely completed. In Albania, preparatory work continued on construction of three peak load storage power plants on the Devoll River within the framework of a joint venture. The ground-breaking ceremony took place in June 2009. In addition, EVN is striving for a partnership with Verbundgesellschaft to build a hydroelectric power station on the Drin River in Albania. In Bulgaria, we were given the go-ahead from the policy makers towards the end of the year under review to construct hydropower plants on the Gorna Arda River. The importance of exploiting renewable energy sources in expanding our own power generating capacities is underlined by several wind power projects we want to carry out in Lower Austria and in Eastern and South East Europe.

In addition to these projects, we are continually investing in the maintenance and expansion of our network infrastructure in Lower Austria as well as in our Bulgarian and Macedonian markets. The start of construction on the trans-regional gas transport pipeline “Südschiene” to secure the long-term supply of gas to Lower Austria is one of the highlights of the past financial year. EVN’s expertise in the gas segment was also internationally recognised during the year under review by the granting of a concession for gas distribution and supply in the administrative region of Zadar on the Adriatic Coast in Croatia. A concession agreement for gas distribution and supply for the region Split was signed in November 2009.

EVN also acquired several new projects in the Environmental Services segment during the year under review. For example, we won contracts to construct a sludge treatment plant in Lithuania and a wastewater disposal system in Montenegro. Other reference projects include a completed sludge treatment facility for Lithuania’s capital of Vilnius, and the modernisation and expansion of a large wastewater treatment facility in Warsaw and Kielce, Poland. EVN also increased the number of end customers directly supplied with drinking water from 41,500 to 50,000 inhabitants by taking over five more communal drinking water supply networks in Lower Austria. Moreover, the ground-breaking ceremony took place to construct a transregional drinking water network in Lower Austria with a length of 40 kilometres, to be completed by 2011.

Based on the successful issuing of five corporate bonds with a total volume of EUR 470m and a generally conservative balance sheet and financing policy, we are ensuring that EVN can carry out its investment projects as planned without endangering current liquidity requirements. We are convinced that all the projects and activities being initiated at present will also help us to fulfill the message underlying our slogan, “Use energy wisely” in the future. We would like to thank all of you as EVN shareholders for your confidence in us. We would also like to particularly thank our employees for their hard and dedicated work enabling us to effectively meet the everyday challenges which face us.

Dr. Burkhard Hofer (Spokesman of the Executive Board and CEO)	Dr. Peter Layr (Member of the Executive Board)	Herbert Pöttschacher (Member of the Executive Board)