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Environmental Services

The activities of the Environmental Services Segment cover drinking water supply, wastewater treatment and thermal waste utilisation in Austria; the international project business in 13 countries throughout Central, Eastern and South Eastern Europe; and the operation of two combined cycle heat and power co-generation plants in Moscow.

Following the initial application of the new IFRS consolidation standards in the third quarter of 2013/14, the results from the waste water purification project in Croatia are reported under the “share of results from equity accounted investees with operational nature“ in EBIT.

Highlights 2013/14

  • Valuation allowance on leasing receivable related to the waste utilisation plant no. 1 in Moscow
  • Impairment loss on sludge treatment plant and components of the Ljuberzy co-generation plant in Moscow
  • Commissioning of the Mia Milia/Haspolat wastewater purification plant in Cyprus
  • New orders in the international environmental services project business
  • Higher revenue from thermal waste utilisation in Lower Austria
  • Expansion of water supplies and construction of natural filter plants in Lower Austria

Revenue development

The Environmental Services segment generated revenue of EUR 191.1m in 2013/14, which represents a decline of EUR 57.2m, or 23.0%, in comparison with the previous year. This development resulted primarily from a lower volume of orders processed in the international project business. Increases in waste and steam revenue from waste utilisation in Lower Austria were unable to offset this decline. Revenue from drinking water supplies in Lower Austria remained stable at the previous year’s level.

Key indicators – Environmental ServicesEURm2013/142012/131)Change
in %
External revenue 168.9227.2-58.3-25.7
Internal revenue
Total revenue 191.1248.4-57.2-23.0
Operating expenses -347.5-209.7-137.8-65.7
Share of results from equity accounted
investees with operational nature
EBITDA -144.650.5-195.1-
Depreciation and amortisation including
effects from impairment tests
Results from operating activities (EBIT) -214.921.5-236.4-
Financial results -4.00.3-4.3-
Profit before income tax -218.821.8-240.7-
Total assets 1,197.61,468.9-271.3-18.5
Total liabilities 1,004.81,059.3-54.5-5.1
Investments2) 13.512.01.512.3

Operating expenses and operating results

Operating expenses rose by EUR 137.8m, or 65.7%, to EUR 347.5m in 2013/14. This increase resulted, above all, from developments in the international project business during the fourth quarter of the reporting year. Significant doubts over the realisation of the thermal waste utilisation plant no. 1 in Moscow led to an valuation allowance of EUR 191.4m on a leasing receivable. EBITDA amounted to EUR –144.6m (previous year: EUR 50.5m), while the results of operating activities (EBIT) equalled EUR –214.9m (previous year: EUR 21.5m). The decline in EBIT resulted from the above-mentioned effects in EBITDA and from impairment losses of EUR 39.6m recognised on the sludge treatment plant and components of the co-generation plant at the Ljuberzy waste water purification plant in Moscow. Depreciation and amortisation totalled EUR 70.2m for the reporting year.

Financial results and profit before tax

Financial results equalled EUR –4.0m and were EUR 0.3m below the previous year. This decline reflected the lower interest margin on completed projects in the international project business and negative effects from foreign currency translation. Profit before tax equalled EUR –218.8m, compared with EUR 21.8m in the previous year.


A total of EUR 13.5m was invested in the Environmental Services Segment during 2013/14, which represents an increase of EUR 1.5m, or 12.3%, over the previous year. EVN worked on nine international projects in this business during 2013/14.

In Montenegro, a contract was signed in February 2014 for the planning and construction of a wastewater purification plant in Kotor- Tivat that will have a capacity to service 72,400 population equivalents. The Budva wastewater treatment project in Montenegro entered the commissioning phase during the reporting year, and work started on the river regulation for the second wastewater treatment plant in the Budva project.

The official commissioning of the Mia Milia/Haspolat wastewater purification plant in the Cypriote capital of Nicosia took place in April 2014. The plant has a capacity to service 270,000 population equivalents. This project also covered the construction of a sludge treatment and a biogas recovery facility. In Larnaca, Cyprus, nearly all buildings for the wastewater purification plant have been completed. This plant will have a capacity to service 100,000 population equivalents and is scheduled to be commissioned in the first half of 2014/15.

In Poland, EVN and its Polish subsidiary received a contract for the planning, modernisation and expansion of the Pruszkow wastewater purification plant in Warsaw which will have the capacity to service 256,000 population equivalents after the project is completed. The building permit for the modernisation and expansion of the Kujawy wastewater purification plant in Krakow was received and work has already started.

EVN constructed a sodium hypochlorite plant for the city of Moscow through WTE Projektgesellschaft Natriumhypochlorit mbH, a company that is headquartered in Germany. The plant was completed in February 2013 and has been operational since that time. However, the city of Moscow was not prepared to meet the payment obligations due to the project company despite the issue of a legally valid operating permit.

As announced in an ad-hoc press release on 29 October 2014, EVN reached an agreement with the Moscow city government over the sale of the sodium hypochlorite plant: Mosvodokanal, the water supply and wastewater disposal company of the city of Moscow, took over the shares in the Russian property company that holds the sodium hypochlorite plant from the project company. The sale price amounted to EUR 250.0m and corresponds to the investment costs plus the expected earnings contribution for the EVN Group. The sale closed on 30 October 2014. WTE has issued a conditional guarantee for the functionality of the plant. Preparatory tests and the commissioning are currently in progress.

EVN took over the management and operation of water supplies for the Lower Austrian community of Göllersdorf in January 2014, which raised the number of end customers who are supplied by EVN with drinking water to roughly 87,000. More than 500,000 residents in Lower Austria are currently supplied by EVN. A further municipal customer, the municipality of Litschau, has been serviced by EVN’s cross-regional “Waldviertel” drinking water system since mid-June 2014. Work also started on the construction of natural filter plants in the Lower Austrian communities of Drösing and Obersiebenbrunn during the reporting year. These plants will reduce the hardness of the water by natural means. The commissioning of the Obersiebenbrunn plant is scheduled for spring 2015. A further plant is planned for Zwentendorf.


The sale of the sodium hypochlorite plant to the city of Moscow is accounted for in the business year 2014/15. The Environmental Services Segment can be expected to generate positive earnings in this financial year assuming the commissioning of the sodium hypochlorite plant as planned and based on the current level of orders in the international project business, the expansion of the drinking water supply network and the construction of natural filter plants.



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