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o | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
OR | ||
þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the fiscal year ended: December 31, 2005 | ||
OR | ||
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
OR | ||
o | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
Date of event requiring this shell company report . | ||
For the transition period from to | ||
Commission file number: 1-14688 |
Federal Republic of Germany | E.ON-Platz 1, D-40479 Düsseldorf, GERMANY | |
(Jurisdiction of Incorporation or Organization) | (Address of Principal Executive Offices) |
Title of each class | Name of each exchange on which registered | |
American Depositary Shares representing | ||
Ordinary Shares with no par value | New York Stock Exchange | |
Ordinary Shares with no par value | New York Stock Exchange* |
* | Not for trading, but only in connection with the registration of American Depositary Shares. |
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• | “E.ON,” the “Company,” the “E.ON Group” or the “Group” refers to E.ON AG and its consolidated subsidiaries. | |
• | “VEBA” refers to VEBA AG and its consolidated subsidiaries prior to its merger with VIAG AG and the name change from VEBA AG to E.ON AG. “VIAG” or the “VIAG Group” refers to VIAG AG and its consolidated subsidiaries prior to its merger with VEBA. | |
• | “PreussenElektra” refers to PreussenElektra AG and its consolidated subsidiaries, which merged with Bayernwerk AG and its consolidated subsidiaries to form E.ON’s German and continental European energy business in the Central Europe market unit consisting of E.ON Energie AG and its consolidated subsidiaries (“E.ON Energie”). | |
• | “E.ON Ruhrgas” refers to E.ON Ruhrgas AG (formerly Ruhrgas AG or “Ruhrgas”) and its consolidated subsidiaries, which collectively comprise E.ON’s gas business in the Pan-European Gas market unit. | |
• | “E.ON UK” refers to E.ON UK plc (formerly Powergen UK plc or “Powergen”) and its consolidated subsidiaries, which collectively comprise E.ON’s U.K. energy business in the U.K. market unit. Until December 31, 2003, Powergen and its consolidated subsidiaries, including LG&E Energy, which was held by Powergen until its transfer to a direct subsidiary of E.ON AG in March 2003, formed E.ON’s former Powergen division (“Powergen Group”). | |
• | “E.ON Sverige” refers to E.ON Sverige AB (formerly Sydkraft AB or “Sydkraft”) and its consolidated subsidiaries, and “E.ON Finland” refers to E.ON Finland Oyj (“E.ON Finland”) and its consolidated subsidiaries, which collectively comprised E.ON’s Nordic energy business in the Nordic market unit until the disposal of E.ON Finland. | |
• | “E.ON U.S.” refers to E.ON U.S. LLC (formerly LG&E Energy LLC (“LG&E Energy”)) and its consolidated subsidiaries, which collectively comprise E.ON’s U.S. energy business in the U.S. Midwest market unit. Until December 31, 2003, E.ON U.S. formed the U.S. business of the Powergen Group. | |
• | “Viterra” refers to Viterra AG and its consolidated subsidiaries, which collectively comprised E.ON’s real estate business in the other activities segment. | |
• | “Degussa” refers to Degussa AG and its consolidated subsidiaries, in which E.ON now owns a minority interest, and which collectively comprised E.ON’s former Degussa division. | |
• | “VEBA Oel” refers to VEBA Oel AG and its consolidated subsidiaries, which collectively comprised E.ON’s former oil division. | |
• | “VAW” refers to VAW aluminium AG and its consolidated subsidiaries, which collectively comprised E.ON’s former aluminum division. | |
• | “MEMC” refers to MEMC Electronic Materials, Inc. and its consolidated subsidiaries, which collectively comprised E.ON’s former silicon wafers division. |
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PART III | ||||||||
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English Translation of the Articles of Association | ||||||||
Sale & Purchase Agreement | ||||||||
Section 302 Certification of Chief Executive Officer | ||||||||
Section 302 Certification of Chief Financial Officer | ||||||||
Section 906 Certification of CEO and CFO |
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Item 1. | Identity of Directors, Senior Management and Advisers. |
Item 2. | Offer Statistics and Expected Timetable. |
Item 3. | Key Information. |
Year Ended December 31, | ||||||||||||||||||||||||
2005(1) | 2005 | 2004 | 2003 | 2002 | 2001 | |||||||||||||||||||
(in millions, except share amounts) | ||||||||||||||||||||||||
Statement of Income Data: | ||||||||||||||||||||||||
Sales | $ | 66,788 | €56,399 | €46,742 | €44,109 | €35,300 | €36,041 | |||||||||||||||||
Sales excluding electricity and natural gas taxes(2) | 61,406 | 51,854 | 42,384 | 40,223 | 34,367 | 35,347 | ||||||||||||||||||
Income/(Loss) from continuing operations before income taxes | 8,536 | 7,208 | 6,355 | 5,165 | (947 | ) | 2,502 | |||||||||||||||||
Income/(Loss) from continuing operations after income taxes(3) | 5,841 | 4,932 | 4,505 | 4,020 | (276 | ) | 2,403 | |||||||||||||||||
Income/(Loss) from continuing operations | 5,186 | 4,379 | 4,027 | 3,575 | (901 | ) | 1,950 | |||||||||||||||||
Income/(Loss) from discontinued operations(4) | 3,594 | 3,035 | 312 | 1,512 | 3,487 | 124 | ||||||||||||||||||
Net income | 8,771 | 7,407 | 4,339 | 4,647 | 2,777 | 2,048 | ||||||||||||||||||
Basic earnings/(Loss) per share from continuing operations | 7.87 | 6.64 | 6.13 | 5.47 | (1.38 | ) | 2.89 | |||||||||||||||||
Basic earnings (Loss) per share from discontinued operations, net(4) | 5.45 | 4.61 | 0.48 | 2.31 | 5.35 | 0.18 | ||||||||||||||||||
Basic earnings per share from net income(5) | 13.31 | 11.24 | 6.61 | 7.11 | 4.26 | 3.03 | ||||||||||||||||||
Balance Sheet Data: | ||||||||||||||||||||||||
Total assets | $ | 149,875 | €126,562 | €114,062 | €111,850 | €113,503 | €101,659 | |||||||||||||||||
Long-term financial liabilities | 12,499 | 10,555 | 13,540 | 14,884 | 17,576 | 9,308 | ||||||||||||||||||
Stockholders’ equity(6) | 52,678 | 44,484 | 33,560 | 29,774 | 25,653 | 24,462 | ||||||||||||||||||
Number of authorized shares | 692,000,000 | 692,000,000 | 692,000,000 | 692,000,000 | 692,000,000 |
(1) | Amounts in this column are unaudited and have been translated solely for the convenience of the reader at an exchange rate of $1.1842 =€1.00, the Noon Buying Rate on December 30, 2005. |
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(2) | Laws in Germany and other European countries in which E.ON operates require the seller of electricity to collect electricity taxes and remit such amounts to tax authorities. Similar laws also require the seller of natural gas to collect and remit natural gas taxes to tax authorities. |
(3) | Before minority interest of€553 million for 2005, as compared with€478 million,€445 million,€625 million and€453 million for 2004, 2003, 2002 and 2001, respectively. |
(4) | For more details, see “Item 5. Operating and Financial Review and Prospects — Acquisitions and Dispositions — Discontinued Operations” and Note 4 of the Notes to Consolidated Financial Statements. |
(5) | Includes earnings per share from the first-time application of new U.S. GAAP standards of€(0.01),€0.00,€(0.67),€0.29 and€(0.04) for 2005, 2004, 2003, 2002 and 2001, respectively. |
(6) | After minority interests. |
Dividends Paid | ||||||||
per Ordinary | ||||||||
Share with no | ||||||||
par value | ||||||||
Year Ended December 31, | € | $(1) | ||||||
2001 | 1.60 | 1.49 | ||||||
2002 | 1.75 | 1.96 | ||||||
2003 | 2.00 | 2.39 | ||||||
2004 | 2.35 | 3.04 | ||||||
2005(2)(3) | 2.75 | 3.26 |
(1) | Translated into dollars at the Noon Buying Rate on the dividend payment date, which typically occurred during the second quarter of the following year, except for the 2005 amount, which has been translated at the Noon Buying Rate on December 30, 2005. |
(2) | The dividend amount for the year ended December 31, 2005 is the amount proposed by E.ON’s Supervisory Board and Board of Management and has not yet been approved by its stockholders. Prior to the payment of the dividends, a resolution approving such amount must be passed by E.ON’s stockholders at the annual general meeting to be held on May 4, 2006. |
(3) | E.ON’s Supervisory Board and Board of Management have also proposed an extra dividend for 2005 of€4.25 per Ordinary Share, resulting from the proceeds from the sale of E.ON’s remaining 42.9 percent stake in Degussa. For details on this transaction, see “Item 5. Operating and Financial Review and Prospects — Overview.” The extra dividend has not yet been approved by E.ON’s stockholders. Prior to the payment of this dividend, which will be made together with the regular dividend amount for the year ended December 31, 2005, a resolution approving such amount must be passed by E.ON’s stockholders at the annual general meeting to be held on May 4, 2006. |
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Period | Average(1) | High | Low | Period-End | |||||||||||||
2001 | 0.8909 | 0.8901 | |||||||||||||||
2002 | 0.9495 | 1.0485 | |||||||||||||||
2003 | 1.1411 | 1.2597 | |||||||||||||||
2004 | 1.2478 | 1.3538 | |||||||||||||||
2005 | 1.2400 | 1.1842 | |||||||||||||||
September | 1.2538 | 1.2011 | |||||||||||||||
October | 1.2148 | 1.1914 | |||||||||||||||
November | 1.2067 | 1.1667 | |||||||||||||||
December | 1.2041 | 1.1699 | |||||||||||||||
2006 | |||||||||||||||||
January | 1.2287 | 1.1980 | |||||||||||||||
February | 1.2100 | 1.1860 |
(1) | The average of the Noon Buying Rates for the relevant period, calculated using the average of the Noon Buying Rates on the last business day of each month during the period. |
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• | Standardized documentation of risks and countermeasures; | |
• | Evaluation of risks according to the degree of severity and the probability of occurrence, and an annual assessment of the effectiveness of existing countermeasures; and | |
• | Analysis of the results and structured disclosure in a risk report. |
The Company’s core energy operations face strong competition, which could depress margins. |
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• | As described above, EU directives provide that the regulatory authority which was appointed in Germany should have the power to set or approve network access charges or, alternatively, the methodologies used for calculating them. This could lead to lower network fees for E.ON’s electricity and gas transportation and distribution businesses in Germany. | |
• | In Germany, the state antitrust authorities in Bavaria, Thuringia, Schleswig-Holstein,Baden-Wuerttemberg and Lower Saxony, as well as the Federal Cartel Office, have launched investigations of certain utilities with allegedly high gas tariffs to determine whether these gas prices constitute market abuse. These investigations affect some utilities in which Thüga and E.ON Energie hold interests. As a result of ongoing discussions with the Federal Cartel Office, E.ON’s regional sales companies have agreed to enable their residential customers to switch gas suppliers as from April 1, 2006. Although a similar investigation by the Federal Cartel Office against subsidiaries of E.ON Energie has been closed without any charges being brought, that office has since opened an investigation of E.ON Energie and its competitor RWE with regard to possible abuses in the markets for electricity and/or CO2 emission certificates. The Company cannot currently predict the outcome of any of the pending investigations. | |
• | Electricity and gas prices and sales practices have also been the subject of periodic challenges by the German antitrust authorities, although to date E.ON has prevailed in such cases, sometimes on appeal after a negative ruling by a court of first instance. Currently, 54 customers of E.ON Hanse AG (“E.ON Hanse”) have brought a claim asserting that recent price increases violate certain provisions of the German Civil Code(Bürgerliches Gesetzbuch). In order to support its case that the price increases were reasonable within the meaning of applicable law, E.ON Hanse has disclosed the basis on which it calculates prices for household customers to the District Court(Landgericht)in Hamburg. The court is currently examining E.ON Hanse’s submissions in this respect and is expected to make an initial pronouncement in the spring of 2006. In an unrelated proceeding, E.ON Westfalen Weser AG (“E.ON Westfalen Weser”) has brought suit against a group of customers that have refused to pay the increased prices. No assurances can be given as to the outcome of either of these proceedings. | |
• | With effect from April 2005, regulators in the United Kingdom renewed a price control framework for electricity distribution customers that is in effect through the five year period ending March 2010. | |
• | In the United States, the rates for E.ON U.S.’s retail electric and gas customers in Kentucky, its principal area of operations, are set by state regulators and remain in effect until such time that an adjustment is sought and approved. E.ON U.S.’s affected utilities applied for and received increases in regulated tariffs |
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effective as of July 1, 2004, although such increases remain the subject of continuing regulatory review and governmental inquiry. |
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Item 4. | Information on the Company. |
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• | In the Pan-European Gas market unit, E.ON intends to leverage its increased gas operations to improve its negotiating position with producers of natural gas, and to take advantage of pan-European gas arbitrage opportunities. For information about E.ON’s planned capital investment in E.ON Ruhrgas, see “Item 5. Operating and Financial Review and Prospects — Liquidity and Capital Resources.” | |
• | In the Central Europe market unit, E.ON expects to benefit from joint market management with regional energy companies, the integration of continental European gas trading activities and the sharing of technical expertise among the power and gas businesses. In order to integrate the Company’s continental European gas trading activities conducted by D-Gas B.V. (“D-Gas”), E.ON Energie transferred their gas trading operations to E.ON Ruhrgas in 2004. | |
• | In the U.K. market unit, E.ON intends to use the Pan-European Gas market unit to enhance E.ON UK’s gas supply and gas storage options, as well as support its trading activities. An important first step was the conclusion of a10-year gas supply contract between E.ON Ruhrgas and E.ON UK. E.ON Ruhrgas started supplying E.ON UK with gas in October 2004. | |
• | In the Nordic market unit, E.ON also intends to use the Pan-European Gas market unit to enhance E.ON Sverige’s gas supply options and expects to be able to use a joint approach for future gas infrastructure development. E.ON Ruhrgas and E.ON Sverige have also entered into a gas supply contract, pursuant to which E.ON Ruhrgas started to supply E.ON Sverige with natural gas in autumn 2005. |
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E.ON’s Business Model After On.top |
• | An Integrated Power and Gas Business. E.ON intends to follow a long-term strategy with a clear focus on integrated power and gas operations that enjoy leading positions in their respective markets. In doing so, it seeks to develop positions throughout the energy value chain, including positions in infrastructure where they are seen as enhancing E.ON’s access to markets and customers. | |
• | A Clear Geographic Focus. E.ON seeks to strengthen its leading positions and performance in its existing markets (Central Europe, Pan-European Gas, U.K., Nordic and U.S. Midwest), while taking focused steps in new markets such as Italy, Russia and — through the proposed acquisition of Endesa — also Spain. | |
• | Clear Strategic Priorities. E.ON’s first priority is to strengthen and grow its position in European markets while maintaining a strong and diversified generation portfolio and enhancing its gas supply position through investments in “equity gas” produced from fields in which E.ON holds an interest, as well as the potential development of liquefied natural gas (“LNG”) as an alternative form of gas delivery. E.ON currently views the United States as an opportunity for more long-term growth. |
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• | Strict Investment Criteria. In following this model, E.ON applies strict strategic and financial criteria to each potential investment, focusing on those which management believes exhibit the potential for material value creation. |
Strategy |
• | Creating value from the convergence of European energy markets (e.g., as the United Kingdom becomes a net importer of gas and can take advantage of greater pipeline capacity connecting it to continental Europe, E.ON will be able to supply its retail gas business in the United Kingdom from its Pan-European Gas supply business); | |
• | Creating value from vertical integration (i.e., establishing a presence in all portions of the value chains for both power and gas); | |
• | Creating value from the convergence of the electricity and gas value chains (e.g., offering retail electricity and gas customers energy from a single source), thus providing E.ON with opportunities to realize economies of scale in servicing costs while increasing customer loyalty, thus reducing its customer “churn rate”; | |
• | Enhancing operational performance through identifying and transferring best practice for common activities throughout the Group’s different market units (e.g., effective programs for enhancing E.ON’s electricity generation, distribution and retailing businesses); | |
• | Improving the Group’s competitive position in its target markets, both through organic growth and through pursuing selective investments which contribute to these objectives or provide stand alone value creation opportunities, as described below; | |
• | Creation of a common corporate culture under the OneE.ON project, which seeks to enhance integration of all market units and their subsidiaries under the E.ON banner so as to help the E.ON Group realize its vision and strategic goals, while maintaining its commitment to corporate social responsibilities; and | |
• | Tapping value-enhancing growth potential in new markets such as Italy, Russia and Spain. |
• | Central Europe — Fortifying strong market positions and developing new growth potential through: |
• | consolidation of distribution and sales activities and capitalizing on opportunities from power-gas convergence; | |
• | re-investing in power generation to maintain the strong market position; | |
• | hedging exposure to price risks through vertical integration of generation and sales operations; | |
• | participating in the privatization of power and downstream gas companies in eastern Central Europe, as well as selective investments in power generation; and | |
• | continued growth in the new market of Italy,i.e. in power generation. |
• | Pan-European Gas — Strengthening and diversifying E.ON Ruhrgas’ current position through: |
• | selective equity investments in gas production in the North Sea and Russia; | |
• | evaluation of LNG options (including upstream positions) to ensure long-term supply diversification; | |
• | participation in infrastructure projects to enhance gas supply position in Europe; and | |
• | selective acquisitions of mid- and downstream companies in Europe. |
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• | U.K. — Enhancing profitability of the U.K. businesses through: |
• | investing in flexible generation assets and low carbon intensive generating technologies, such as Combined Cycle Gas Turbine (“CCGT”), to maintain a low cost hedge for changes in retail electricity demand; | |
• | investing in the generation of power from renewable resources to capture value from the U.K. government’s renewable obligation mandate; and | |
• | investing in gas storage assets to hedge against potentially volatile gas price movements as the United Kingdom starts to become a net importer of gas. |
• | Nordic — Strengthening E.ON’s position through: |
• | expanding its presence in power generation; | |
• | enhancing scale through synergistic acquisitions in distribution and district heating; and | |
• | continued participation in gas supply and infrastructure developments. |
• | U.S. Midwest — Focusing on optimizing E.ON U.S.’s current operations in Kentucky and delivering additional performance improvements. This could include investments in generation capacity if the demand for electricity grows and the U.S. regulatory authorities enable the Company to earn a return on investment that meets its stringent criteria. |
• | Central Europe, led by E.ON Energie AG; | |
• | Pan-European Gas, led by E.ON Ruhrgas AG; | |
• | U.K., led by E.ON UK plc; | |
• | Nordic, led by E.ON Nordic AB; and | |
• | U.S. Midwest, led by E.ON U.S. LLC (formerly LG&E Energy). |
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• | The transfer by E.ON Energie to E.ON Ruhrgas of its: |
• | 67.7 percent interest in Thüga; | |
• | 29.95 percent interest of its 40.0 percent interest in the Austrian company RAG Beteiligungs-Aktiengesellschaft, which owns a 75.0 percent share in the Austrian exploration and production company Rohöl-Aufsuchungs Aktiengesellschaft; the remaining 10.05 percent interest was swapped with the Austrian company EVN AG for its 31.23 percent shareholding in the Hungarian gas distribution company Közép-dunántúli Gázszolgáltató Rt. (“KÖGÁZ”) in April 2005; | |
• | 18.8 percent interest in the Latvian gas supplier JSC Latvijas Gaze; | |
• | 14.3 percent interest in the Lithuanian gas distributor AB Lietuvos Dujos; and its | |
• | gas trading company D-Gas. |
• | The transfer by E.ON Ruhrgas to E.ON Energie of its downstream gas activities in the Czech Republic and Hungary, including its: |
• | 4.45 percent interest in the Czech gas distribution company Jihomoravská plynárenská a.s. (“JMP”); | |
• | 27.6 percent interest in the Czech gas distribution company Západoceská plynárenská a.s. (“ZCP”); | |
• | 24.0 percent interest in the Czech gas distribution company Prazská plynárenská Holding a.s. (“PPH”); | |
• | 0.05 percent interest in the Czech gas distribution company Prazská plynárenská a.s. (“PP”); | |
• | 14.3 percent interest in the Czech gas distribution company Stredoceska plynárenská a.s. (“STP”); | |
• | 9.57 percent interest in the Czech gas distribution company Severomoravská plynárenská a.s. (“SMP”); | |
• | 16.52 percent interest in the Czech gas distribution company Východoceská plynárenská a.s. (“VCP”); | |
• | 49.8 percent interest in the Hungarian gas distribution company Déldunántuli Gázszolgáltató Részvenytársaság (“DDGÁZ”); and its |
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• | 16.3 percent interest in the Hungarian gas distribution company Fövárosi Gázmüvek Részvénytársaság (“FÖGÁZ”). |
• | The transfer by E.ON Energie to E.ON AG of its 100 percent interest in E.ON Scandinavia (which has since been renamed E.ON Nordic), including its: |
• | 55.2 percent interest in Sydkraft (which has since been renamed E.ON Sverige), including its interest in Graninge AB (“Graninge”) and its interest in the Baltic Cable; and a | |
• | 65.6 percent interest in E.ON Finland. |
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2005 | 2004 | 2003 | |||||||||||||||||||||||
(€ in | (€ in | (€ in | |||||||||||||||||||||||
millions) | % | millions) | % | millions) | % | ||||||||||||||||||||
Central Europe(1)(2) | 24,295 | 43.1 | 20,752 | 44.4 | 19,253 | 43.6 | |||||||||||||||||||
Pan-European Gas(2)(3) | 17,914 | 31.8 | 13,227 | 28.3 | 11,919 | 27.0 | |||||||||||||||||||
U.K. | 10,176 | 18.0 | 8,490 | 18.2 | 7,923 | 18.0 | |||||||||||||||||||
Nordic(4) | 3,471 | 6.2 | 3,347 | 7.1 | 2,824 | 6.4 | |||||||||||||||||||
U.S. Midwest(2) | 2,045 | 3.6 | 1,718 | 3.7 | 1,771 | 4.0 | |||||||||||||||||||
Corporate Center(2)(5) | (1,502 | ) | (2.7 | ) | (792 | ) | (1.7 | ) | (575 | ) | (1.3 | ) | |||||||||||||
Core Energy Business | 56,399 | 100.0 | 46,742 | 100.0 | 43,115 | 97.7 | |||||||||||||||||||
Other Activities(2)(6) | 0 | 0 | 0 | 0 | 994 | 2.3 | |||||||||||||||||||
Total Revenues(7) | 56,399 | 100.0 | 46,742 | 100.0 | 44,109 | 100.0 | |||||||||||||||||||
(1) | Includes electricity taxes of€1,049 million in 2005,€1,051 million in 2004 and€1,015 million in 2003. |
(2) | Excludes the sales of certain activities now accounted for as discontinued operations. For more details, see “Item 5. Operating and Financial Review and Prospects — Acquisitions and Dispositions — Discontinued Operations” and Note 4 of the Notes to Consolidated Financial Statements. |
(3) | Includes the sales of the former Ruhrgas activities from the date of consolidation on February 1, 2003. Sales include natural gas and electricity taxes of€3,110 million in 2005,€2,923 million in 2004 and€2,555 million in 2003. |
(4) | Sales include electricity and natural gas taxes of€402 million in 2005,€395 million in 2004 and€324 million in 2003. |
(5) | Includes primarily the parent company and effects from consolidation, as well as the results of its remaining telecommunications interests, as explained above. |
(6) | Includes sales of Degussa until January 2003, prior to its deconsolidation. For more details, see “— Other Activities — Degussa,” “Item 5. Operating and Financial Review and Prospects — Overview” and Note 4 of the Notes to Consolidated Financial Statements. |
(7) | Excludes intercompany sales. |
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Overview |
• | In 2005, E.ON Energie increased its stake in the Hungarian gas distribution and supply company KÖGÁZ from 31.2 percent to 98.1 percent in several steps. In 2005, the company sold an aggregate of approximately 8.3 TWh of gas to 0.3 million customers. | |
• | In February 2005, E.ON Energie acquired 67.0 percent stakes in each of the two Bulgarian electricity distribution companies Varna and Gorna Oryahovitza. The companies operate in northeastern Bulgaria. In 2005, the companies sold an aggregate of approximately 4.9 TWh of electricity to 1.1 million customers. | |
• | In July 2005, E.ON Energie transferred its 51.0 percent interest (49.0 percent voting interest) in Gasversorgung Thüringen GmbH (“GVT”) and its 72.7 percent interest in Thüringer Energie AG (“TEAG”) to Thüringer Energie Beteiligungsgesellschaft mbH (“TEB”). Municipal shareholders also transferred interests in GVT totaling 43.9 percent to TEB. Consequently, GVT was merged into TEAG and the merged entity was renamed E.ON Thüringer Energie AG (“ETE”). Following this reorganization, E.ON Energie holds an 81.5 percent interest in TEB and TEB holds a 76.8 percent interest in ETE. | |
• | In July 2005, E.ON Energie acquired an additional 0.9 percent interest in Contigas Deutsche Energie AG (“Contigas”) through a public offer. In June 2005, the general meeting of Contigas passed a resolution authorizing E.ON Energie to use a squeeze-out procedure to acquire the remaining Contigas stock held by minority shareholders. Following the completion of the squeeze-out in November 2005, E.ON Energie acquired the remaining 0.2 percent and now owns 100 percent of Contigas. |
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• | In September 2005, E.ON Energie acquired a 24.6 percent stake in the Romanian electricity distribution company Electrica Moldova — now renamed E.ON Moldova — and simultaneously increased its stake in the company to 51.0 percent by subscribing to a capital increase. In 2004, the company sold approximately 4.3 TWh of electricity to 1.3 million customers. | |
• | In September 2005, E.ON Benelux acquired 100.0 percent of the Dutch power and gas company NRE Energie b.v. (“NRE”). In 2004, the company supplied approximately 1.6 TWh of electricity and approximately 4.8 TWh of gas to approximately 0.3 million electricity and gas customers in the Netherlands. | |
• | In 2005, E.ON Energie decided to invest in new power plants in Germany in Irsching (530 MW natural gas) and Datteln (1,100 MW hard coal). Additionally, E.ON Energie plans to build a new Italian power plant at Livorno Ferraris (800 MW natural gas). For more information, see “Item 5. Operating and Financial Review and Prospects — Liquidity and Capital Resources — Expected Investment Activity.” | |
• | In February 2006, E.ON Energie and RWE signed agreements to swap certain shareholdings in the Czech Republic and Hungary. These transactions are subject to regulatory and corporate approvals and are expected to be completed in 2006. |
• | Leading entity for the management and coordination of the group activities. |
• | Centralized strategic, controlling and service functions. |
Western Europe |
• | Power generation by conventional power plants. |
• | Waste incineration. |
• | Renewables. |
• | District heating. |
• | Industrial power plants. |
• | Power generation by nuclear power plants. |
• | Power generation by hydroelectric power plants. |
• | Power generation by conventional power plants in the Netherlands. |
• | District heating in the Netherlands. |
• | Sales of power and gas in the Netherlands. |
• | Operation of high voltage grids (380 kilovolt-110 kilovolt). |
• | System operation, including provision of regulating and balancing power. |
• | Supply of electricity and energy services to large industrial customers, as well as to regional and municipal distributors. |
• | Centralized wholesale functions. |
• | Optimization of energy procurement costs. |
• | Physical energy trading and trading of energy-based financial instruments and related risk management. |
• | Optimization of the value of the power plants’ assets in the market place. |
• | Emissions trading. |
(shareholding percentages range from 62.8 to 100.0 percent)
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• | Distribution and sale of electricity, gas, heat and water to retail customers. |
• | Energy support services. |
• | Waste incineration. |
• | Customer service and electricity and heat supply to utilities and industrial customers in the Ruhr region. |
Eastern Europe |
• | Generation, distribution and sale of electricity and gas in Hungary through its group companies. |
• | Generation, distribution and sale of electricity in the Czech Republic through its group companies. |
• | Distribution and sale of electricity in Romania. |
• | Distribution and sale of electricity in Bulgaria through its group companies. |
• | Distribution and sale of electricity in Slovakia. |
• | Provision of consulting and planning services in the energy sector to companies within the Group and third parties. |
• | Marketing of expertise in the area of conventional, renewable, cogeneration and nuclear power generation and pipeline business. |
• | Provision of information technology services to companies within the Group and third parties. |
• | Infrastructure services. |
(1) | The remaining 43.0 percent is held by E.ON Ruhrgas. |
(2) | The remaining 40.0 percent is held by E.ON AG and E.ON Ruhrgas. |
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Generation: | the production of electricity at power stations; | |
Transmission: | the bulk transfer of electricity across an interregional power grid, which consists mainly of overhead transmission lines, substations and some underground cables (at this level there is a market for bulk trading of electricity, through which sales and purchases of electricity are made between generators, regional distributors, and other suppliers of electricity); | |
Distribution and Sale: | the transfer and sale of electricity from the interregional power grid and its delivery, across local distribution systems, to customers; and | |
Trading: | the buying and selling of electricity and related products for purposes of portfolio optimization, arbitrage and risk management. |
2005 | 2004 | |||||||||||||
million | million | % | ||||||||||||
Sources of Power | kWh | kWh | Change | |||||||||||
Own production | 129,063 | 131,278 | -1.7 | |||||||||||
Purchased power | 142,215 | 123,035 | +15.6 | |||||||||||
from power stations in which E.ON Energie has an interest of 50 percent or less | 12,019 | 11,223 | +7.1 | |||||||||||
from other suppliers | 130,196 | 111,812 | +16.4 | |||||||||||
Total power procured(1) | 271,278 | 254,313 | +6.7 | |||||||||||
Power used for operating purposes, network losses and pump storage | (12,735 | ) | (10,239 | ) | +24.4 | |||||||||
Total | 258,543 | 244,074 | +5.9 | |||||||||||
(1) | Excluding physically-settled electricity trading activities at E.ON Sales & Trading GmbH (“EST”). EST’s physically-settled electricity trading activities amounted to 113,666 million kWh and 110,914 million kWh in 2005 and 2004, respectively. |
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Total | Total | ||||||||||||
2005 | 2004 | % | |||||||||||
million | million | Change in | |||||||||||
Sale of Power(1) to | kWh | kWh | Total | ||||||||||
Non-consolidated interregional, regional and municipal utilities | 138,425 | 130,862 | +5.8 | ||||||||||
Industrial and commercial customers | 77,175 | 72,077 | +7.1 | ||||||||||
Residential and small commercial customers | 42,943 | 41,135 | +4.4 | ||||||||||
Total | 258,543 | 244,074 | +5.9 | ||||||||||
(1) | Excluding physically-settled electricity trading activities at EST. EST’s physically-settled electricity trading activities amounted to 113,666 million KWh and 110,914 million kWh in 2005 and 2004, respectively. |
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Capacity | |||||||||||||||||
Attributable to | |||||||||||||||||
Total | E.ON Energie | ||||||||||||||||
Capacity | Start-up | ||||||||||||||||
Power Plants | Net MW | %(1) | MW | Date | |||||||||||||
Nuclear | |||||||||||||||||
Brokdorf | 1,370 | 80.0 | 1,096 | 1986 | |||||||||||||
Brunsbüttel | 771 | 33.3 | 257 | 1976 | |||||||||||||
Emsland | 1,329 | 12.5 | 166 | 1988 | |||||||||||||
Grafenrheinfeld | 1,275 | 100.0 | 1,275 | 1981 | |||||||||||||
Grohnde | 1,360 | 83.3 | 1,133 | 1984 | |||||||||||||
Gundremmingen B | 1,284 | 25.0 | 321 | 1984 | |||||||||||||
Gundremmingen C | 1,288 | 25.0 | 322 | 1984 | |||||||||||||
Isar 1 | 878 | 100.0 | 878 | 1977 | |||||||||||||
Isar 2 | 1,400 | 75.0 | 1,050 | 1988 | |||||||||||||
Krümmel | 1,260 | 50.0 | 630 | 1983 | |||||||||||||
Unterweser | 1,345 | 100.0 | 1,345 | 1978 | |||||||||||||
Total | 13,560 | 8,473 | |||||||||||||||
Lignite | |||||||||||||||||
Buschhaus | 350 | 100.0 | 350 | 1985 | |||||||||||||
Kassel | 33 | 50.0 | 17 | 1988 | |||||||||||||
Lippendorf S | 891 | 50.0 | 446 | 1999 | |||||||||||||
Schkopau | 900 | 55.6 | 500 | 1995 | |||||||||||||
Total | 2,174 | 1,313 | |||||||||||||||
Hard Coal | |||||||||||||||||
Bexbach 1 | 714 | 8.3 | 59 | 1983 | |||||||||||||
Buer (CHP) | 70 | 100.0 | 70 | 1985 | |||||||||||||
Datteln 1 | 95 | 100.0 | 95 | 1964 | |||||||||||||
Datteln 2 | 95 | 100.0 | 95 | 1964 | |||||||||||||
Datteln 3 | 113 | 100.0 | 113 | 1969 | |||||||||||||
Farge | 345 | 100.0 | 345 | 1969 | |||||||||||||
GKW Weser/ Veltheim 2 | 93 | 67.0 | 62 | 1965 | |||||||||||||
GKW Weser/ Veltheim 3 | 303 | 67.0 | 203 | 1970 | |||||||||||||
Heyden | 865 | 100.0 | 865 | 1987 | |||||||||||||
Kiel | 323 | 50.0 | 162 | 1970 | |||||||||||||
Knepper C | 345 | 100.0 | 345 | 1971 | |||||||||||||
Maasvlakte 1 (NL)(2) | 532 | 100.0 | 532 | 1988 | |||||||||||||
Maasvlakte 2 (NL)(2) | 520 | 100.0 | 520 | 1987 | |||||||||||||
Mehrum C | 690 | 50.0 | 345 | 1979 | |||||||||||||
Rostock | 508 | 50.4 | 256 | 1994 | |||||||||||||
Scholven B | 345 | 100.0 | 345 | 1968 |
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Capacity | |||||||||||||||||
Attributable to | |||||||||||||||||
Total | E.ON Energie | ||||||||||||||||
Capacity | Start-up | ||||||||||||||||
Power Plants | Net MW | %(1) | MW | Date | |||||||||||||
Hard Coal (continued) | |||||||||||||||||
Scholven C | 345 | 100.0 | 345 | 1969 | |||||||||||||
Scholven D | 345 | 100.0 | 345 | 1970 | |||||||||||||
Scholven E | 345 | 100.0 | 345 | 1971 | |||||||||||||
Scholven F | 676 | 100.0 | 676 | 1979 | |||||||||||||
Shamrock | 132 | 100.0 | 132 | 1957 | |||||||||||||
Staudinger 1 | 249 | 100.0 | 249 | 1965 | |||||||||||||
Staudinger 3 | 293 | 100.0 | 293 | 1970 | |||||||||||||
Staudinger 5 | 510 | 100.0 | 510 | 1992 | |||||||||||||
Wilhelmshaven | 747 | 100.0 | 747 | 1976 | |||||||||||||
Zolling | 449 | 100.0 | 449 | 1986 | |||||||||||||
Total | 10,047 | 8,503 | |||||||||||||||
Natural Gas | |||||||||||||||||
Burghausen | 120 | 100.0 | 120 | 2001 | |||||||||||||
Emden GT | 52 | 100.0 | 52 | 1972 | |||||||||||||
Erfurt | 80 | 27.8 | 22 | — | |||||||||||||
Franken I/1 | 383 | 100.0 | 383 | 1973 | |||||||||||||
Franken I/2 | 440 | 100.0 | 440 | 1976 | |||||||||||||
Galileistraat (NL) | 209 | 100.0 | 209 | 1988 | |||||||||||||
Gendorf | 40 | 50.0 | 20 | 2002 | |||||||||||||
GKW Weser/ Veltheim 4 GT | 400 | 74.0 | 296 | 1975 | |||||||||||||
Grenzach-Wyhlen | 40 | 69.9 | 28 | 2004 | |||||||||||||
GT Ummeln | 55 | 74.0 | 41 | 1973 | |||||||||||||
Huntorf | 290 | 100.0 | 290 | 1977 | |||||||||||||
Irsching 3 | 415 | 100.0 | 415 | 1974 | |||||||||||||
Jena-Süd | 199 | 62.6 | 125 | 1996 | |||||||||||||
Kirchlengern | 180 | 62.9 | 113 | 1980 | |||||||||||||
Kirchmöser | 178 | 100.0 | 178 | 1994 | |||||||||||||
Leiden (NL) | 83 | 100.0 | 83 | 1986 | |||||||||||||
Maasvlakte UCML (NL) | 78 | 100.0 | 78 | 2004 | |||||||||||||
Obernburg | 100 | 50.0 | 50 | 1995 | |||||||||||||
Robert Frank 4 | 487 | 100.0 | 487 | 1973 | |||||||||||||
RoCa 3 (NL)(2) | 220 | 100.0 | 220 | 1996 | |||||||||||||
Staudinger 4 | 622 | 100.0 | 622 | 1977 | |||||||||||||
The Hague (NL) | 78 | 100.0 | 78 | 1982 | |||||||||||||
Other (<40 MW installed capacity) | 283 | n/a | 253 | n/a | |||||||||||||
Total | 5,032 | 4,603 | |||||||||||||||
Fuel Oil | |||||||||||||||||
Audorf | 87 | 100.0 | 87 | 1973 | |||||||||||||
Hausham GT 1 | 25 | 100.0 | 25 | 1982 | |||||||||||||
Hausham GT 2 | 25 | 100.0 | 25 | 1982 |
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Capacity | |||||||||||||||||
Attributable to | |||||||||||||||||
Total | E.ON Energie | ||||||||||||||||
Capacity | Start-up | ||||||||||||||||
Power Plants | Net MW | %(1) | MW | Date | |||||||||||||
Fuel Oil (continued) | |||||||||||||||||
Hausham GT 3 | 25 | 100.0 | 25 | 1982 | |||||||||||||
Hausham GT 4 | 25 | 100.0 | 25 | 1982 | |||||||||||||
Ingolstadt 3 | 386 | 100.0 | 386 | 1973 | |||||||||||||
Ingolstadt 4 | 386 | 100.0 | 386 | 1974 | |||||||||||||
Itzehoe | 88 | 100.0 | 88 | 1972 | |||||||||||||
Wilhelmshaven | 56 | 100.0 | 56 | 1973 | |||||||||||||
Zolling GT 1 | 25 | 100.0 | 25 | 1976 | |||||||||||||
Zolling GT 2 | 25 | 100.0 | 25 | 1976 | |||||||||||||
Total | 1,153 | 1,153 | |||||||||||||||
Hydroelectric | |||||||||||||||||
Aufkirchen | 27 | 100.0 | 27 | 1924 | |||||||||||||
Bittenbrunn | 20 | 100.0 | 20 | 1969 | |||||||||||||
Bergheim | 24 | 100.0 | 24 | 1970 | |||||||||||||
Braunau-Simbach | 100 | 50.0 | 50 | 1953 | |||||||||||||
Egglfing | 81 | 100.0 | 81 | 1944 | |||||||||||||
Eitting | 26 | 100.0 | 26 | 1925 | |||||||||||||
Ering | 73 | 100.0 | 73 | 1942 | |||||||||||||
Erzhausen | 220 | 100.0 | 220 | 1964 | |||||||||||||
Feldkirchen | 38 | 100.0 | 38 | 1970 | |||||||||||||
Gars | 25 | 100.0 | 25 | 1938 | |||||||||||||
Geisling | 25 | 100.0 | 25 | 1985 | |||||||||||||
Happurg | 160 | 100.0 | 160 | 1958 | |||||||||||||
Hemfurth | 20 | 100.0 | 20 | 1915 | |||||||||||||
Jochenstein | 132 | 50.0 | 66 | 1955 | |||||||||||||
Kachlet | 54 | 100.0 | 54 | 1927 | |||||||||||||
Langenprozelten | 164 | 100.0 | 164 | 1975 | |||||||||||||
Neuötting | 26 | 100.0 | 26 | 1951 | |||||||||||||
Nußdorf | 48 | 76.5 | 37 | 1982 | |||||||||||||
Oberaudorf-Ebbs | 60 | 50.0 | 30 | 1992 | |||||||||||||
Passau-Ingling | 86 | 50.0 | 43 | 1965 | |||||||||||||
Pfrombach | 22 | 100.0 | 22 | 1929 | |||||||||||||
Reisach | 105 | 100.0 | 105 | 1955 | |||||||||||||
Rosenheim | 35 | 100.0 | 35 | 1960 | |||||||||||||
Roßhaupten | 46 | 100.0 | 46 | 1954 | |||||||||||||
Schärding-Neuhaus | 96 | 50.0 | 48 | 1961 | |||||||||||||
Stammham | 23 | 100.0 | 23 | 1955 | |||||||||||||
Straubing | 22 | 100.0 | 22 | 1994 | |||||||||||||
Tanzmühle | 28 | 100.0 | 28 | 1959 | |||||||||||||
Teufelsbruck | 25 | 100.0 | 25 | 1938 | |||||||||||||
Töging | 85 | 100.0 | 85 | 1924 | |||||||||||||
Vohburg | 23 | 100.0 | 23 | 1992 |
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Capacity | |||||||||||||||||
Attributable to | |||||||||||||||||
Total | E.ON Energie | ||||||||||||||||
Capacity | Start-up | ||||||||||||||||
Power Plants | Net MW | %(1) | MW | Date | |||||||||||||
Hydroelectric (continued) | |||||||||||||||||
Walchensee | 124 | 100.0 | 124 | 1924 | |||||||||||||
Waldeck 1 | 120 | 100.0 | 120 | 1931 | |||||||||||||
Waldeck 2 | 440 | 100.0 | 440 | 1975 | |||||||||||||
Wasserburg | 24 | 100.0 | 24 | 1938 | |||||||||||||
Other run-of-river, pump storage and storage | 781 | n/a | 734 | n/a | |||||||||||||
Total | 3,408 | 3,113 | |||||||||||||||
Others | 537 | 333 | |||||||||||||||
Total | 35,911 | 27.491 | |||||||||||||||
Mothballed/ Shutdown/ Reduced | |||||||||||||||||
Arzberg 5(3) | 104 | 100.0 | 104 | 1966 | |||||||||||||
Arzberg 6(3) | 252 | 100.0 | 252 | 1974 | |||||||||||||
Arzberg 7(3) | 121 | 100.0 | 121 | 1979 | |||||||||||||
Aschaffenburg 21(3) | 150 | 100.0 | 150 | 1963 | |||||||||||||
Aschaffenburg 31(3) | 143 | 100.0 | 143 | 1971 | |||||||||||||
Emden 4(4) | 433 | 100.0 | 433 | 1972 | |||||||||||||
Franken II/1(3) | 206 | 100.0 | 206 | 1966 | |||||||||||||
Franken II/2(3) | 206 | 100.0 | 206 | 1967 | |||||||||||||
Irsching 1 | 151 | 100.0 | 151 | 1969 | |||||||||||||
Irsching 2 | 312 | 100.0 | 312 | 1972 | |||||||||||||
Offleben(3) | 280 | 100.0 | 280 | 1988 | |||||||||||||
Pleinting 1 | 292 | 100.0 | 292 | 1968 | |||||||||||||
Pleinting 2 | 402 | 100.0 | 402 | 1976 | |||||||||||||
Rauxel 2(3) | 164 | 100.0 | 164 | 1967 | |||||||||||||
Scholven G(3) | 672 | 50.0 | 336 | 1974 | |||||||||||||
Scholven H(3) | 672 | 50.0 | 336 | 1975 | |||||||||||||
Schwandorf B(3) | 99 | 100.0 | 99 | 1959 | |||||||||||||
Schwandorf C(3) | 99 | 100.0 | 99 | 1961 | |||||||||||||
Schwandorf D(3) | 292 | 100.0 | 292 | 1972 | |||||||||||||
Stade(3) | 640 | 66.7 | 417 | 1972 | |||||||||||||
Staudinger 2 | 249 | 100.0 | 249 | 1965 | |||||||||||||
Westerholt 1(3) | 138 | 100.0 | 138 | 1959 | |||||||||||||
Westerholt 2(3) | 138 | 100.0 | 138 | 1961 | |||||||||||||
Total | 6,215 | 5,320 | |||||||||||||||
(1) | Percentage of total capacity attributable to E.ON Energie. |
(2) | Power station operated by E.ON Benelux under long-term cross-border leasing arrangement. |
(3) | Dismantling in process or finished, respectively. |
(4) | Recommissioned in January 2006. |
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• | Nuclear Phase-out: The operators of the nuclear plants have agreed to a specified number of operating kWh for each nuclear plant. This number has been calculated on the basis of 32 years of plant operation using a high load factor. The operators may trade allotted kWh among themselves. This means that if one nuclear plant closes before it has produced the allotted amount of kWh, the remaining kWh may be transferred to another nuclear power plant. | |
• | Termination of Fuel Reprocessing: The transport of spent fuel elements for reprocessing was allowed until June 30, 2005. Following this deadline, the operators must store spent fuel in interim facilities on the premises of the nuclear plants. Such storage requires the approval and construction of interim storage facilities. The Company is currently constructing five interimon-site storage facilities, of which two are expected to go into operation in the first quarter of 2006, with the remaining three scheduled to be ready between November 2006 and February 2007. For the period from July 2005 until storage can begin in the interim storage facilities, the Company is storing the spent fuel elements at the plants in so-called in-plant fuel pools. The Company expects the capacity of these fuel pools to be sufficient to store the spent fuel elements until the storage facilities go into operation. E.ON has delivered all spent fuel elements under its reprocessing contracts with Cogema and BNGS. |
• | The accrual period for decommissioning costs has been extended from 19 to 25 years. This requires E.ON Energie to release a portion of the provisions it had previously established for tax purposes based on the shorter accrual period. | |
• | Certain parts of the provisions concerning MOX fuel elements have to be reversed. The costs must be capitalized as incurred instead. | |
• | Those portions of the provisions that have been established in past years relating to the financing and operational costs for final storage of nuclear waste have been disallowed. The costs of these items will now be tax-deductible when they are actually expensed. | |
• | In accordance with the new general rule for long-term provisions, all types of provisions for nuclear power must now be discounted. The Tax Relief Act sets the discount rate at 5.5 percent. This also applies |
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to provisions that have previously been established, which must be released to the extent they do not reflect this discounting. |
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Germany | Germany | ||||||||||||
2005 | 2004 | % | |||||||||||
million | million | Change | |||||||||||
Sale of Power to | kWh | kWh | in Total | ||||||||||
Non-consolidated interregional, regional and municipal utilities(1) | 116,654 | 112,575 | +3.6 | ||||||||||
Industrial and commercial customers(2)(3) | 59,134 | 56,274 | +5.1 | ||||||||||
Residential and small commercial customers | 29,978 | 30,352 | -1.2 | ||||||||||
Total(3) | 205,766 | 199,201 | +3.3 | ||||||||||
(1) | The sale of power to non-consolidated interregional, regional and municipal utilities increased in 2005 compared with 2004, reflecting increased sales of electricity produced from renewable resources. |
(2) | The sale of power to industrial and commercial customers increased in 2005 compared with 2004, primarily due to additional customers acquired. |
(3) | The sale of power includes sales of EST in other European countries. |
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2005 | 2004 | % | |||||||||||
million | million | Change | |||||||||||
Trading of Power | kWh | kWh | in Total | ||||||||||
Power sold | 164,109 | 146,755 | +11.8 | ||||||||||
Power purchased | 168,734 | 162,671 | +3.7 | ||||||||||
Total | 332,843 | 309,426 | +7.6 | ||||||||||
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Eastern Europe |
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• | In November 2004, ERI signed an agreement for the acquisition of 75.0 percent minus one share each of the gas trading and gas storage businesses of the Hungarian oil and gas company MOL and its 50.0 percent interest in the gas import subsidiary Panrusgáz. In addition, MOL received a put option to sell to ERI up to 75.0 percent minus one share of its gas transmission business and put options to sell to ERI the remaining 25.0 percent plus one share in the MOL gas trading and gas storage businesses. As a condition of antitrust approval by the EU commission, MOL is obliged to sell the remaining 25.0 percent plus one share of the gas trading and storage businesses as well. As a result, ERI signed an agreement for the acquisition of the remaining 25.0 percent plus one share of each of the two companies. These transactions are expected to be completed at the end of March 2006. | |
• | In June 2005, after clearance was obtained from the relevant authorities, E.ON Ruhrgas acquired a 51.0 percent stake in the Romanian gas supplier Distrigaz Nord from the Romanian government. Distrigaz Nord is active in gas distribution and supply in northern Romania. |
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• | In June 2005, E.ON Ruhrgas signed an agreement for the sale of Ruhrgas Industries to CVC Capital Partners. | |
• | In September 2005, E.ON Ruhrgas Norge AS (“E.ON Ruhrgas Norge”) acquired an additional 15.0 percent stake in the Njord oil and gas field from the British oil and gas company Paladin Resources plc. and now owns a 30.0 percent stake in this field. | |
• | In September 2005, Gazprom, BASF and E.ON signed a “basic agreement” on the construction of the NEGP. | |
• | In November 2005, E.ON Ruhrgas acquired Caledonia, a U.K. gas production company with interests in a total of 15 gas fields in the U.K. southern North Sea, from First Reserve, CSFB Private Equity Funds and others. Apart from its stakes in gas fields, Caledonia wholly owns Caledonia Energy Trading Limited (“CETL”) and has interests in two pipeline systems near the gas fields for transporting gas to the United Kingdom. | |
• | In the course of 2005, E.ON Ruhrgas UK Exploration and Production Limited (“E.ON Ruhrgas UK”) acquired a further 13.59 percent stake in Interconnector (U.K.) Limited (“Interconnector”) from BP plc. (“BP”) (4.0 percent), International Power plc (“International Power”) (3.38 percent) and Amerada Hess Corporation (“Amerada Hess”) (6.21 percent). E.ON Ruhrgas UK now holds a total interest of 23.59 percent in this company. |
Supply: | The purchase of natural gas under long-term contracts with foreign and domestic producers, including the Russian gas company Gazprom, the world’s largest gas producer in terms of volume, in which E.ON Ruhrgas holds a small shareholding. E.ON Ruhrgas also engages in gas exploration and production activities and, to supplement its supply as well as its sales business, in a limited amount of trading activities; | |
Transmission: | The transmission of gas within Germany via a network of approximately 11,000 km of pipelines in which E.ON Ruhrgas holds an interest; | |
Storage: | The storage of gas in a number of large underground natural gas storage facilities; and | |
Sales: | The sale of gas within Germany to regional and supraregional distributors, municipal utilities and industrial customers, as well as the delivery of gas to a number of customers in other European countries. |
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Total 2005 | Total 2004 | ||||||||||||||||
Purchases | billion kWh | % | billion kWh | % | |||||||||||||
Imports | 580.0 | 84.5 | 537.4 | 83.2 | |||||||||||||
German sources | 106.1 | 15.5 | 108.6 | 16.8 | |||||||||||||
Total | 686.1 | 100.0 | 646.0 | 100.0 | |||||||||||||
Sales | |||||||||||||||||
Domestic distributors | 323.7 | 46.9 | 328.7 | 51.2 | |||||||||||||
Domestic municipal utilities | 160.9 | 23.3 | 156.1 | 24.3 | |||||||||||||
Domestic industrial customers | 70.4 | 10.2 | 69.0 | 10.8 | |||||||||||||
Sales abroad | 135.2 | 19.6 | 87.6 | 13.7 | |||||||||||||
Total | 690.2 | 100.0 | 641.4 | 100.0 | |||||||||||||
Total 2005 | Total 2004 | ||||||||||||||||
Sources of Gas | billion kWh | % | billion kWh | % | |||||||||||||
Germany | 106.1 | 15.5 | 108.6 | 16.8 | |||||||||||||
Russia | 193.5 | 28.2 | 201.3 | 31.2 | |||||||||||||
Norway | 188.4 | 27.5 | 169.6 | 26.3 | |||||||||||||
The Netherlands | 139.0 | 20.2 | 124.1 | 19.2 | |||||||||||||
United Kingdom | 34.1 | 5.0 | 22.8 | 3.5 | |||||||||||||
Denmark | 23.7 | 3.4 | 19.3 | 3.0 | |||||||||||||
Others(1) | 1.3 | 0.2 | 0.3 | 0.0 | |||||||||||||
Total | 686.1 | 100.0 | 646.0 | 100.0 | |||||||||||||
(1) | Italy and France. |
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E.ON | ||||
Ruhrgas Share | ||||
Project Company | % | |||
DEUDAN (DEUDAN — Deutsch/ Dänische Erdgastransport-Gesellschaft mbH & Co. KG) | 25.0 | |||
EGL (Etzel Gas-Lager GmbH & Co. KG) | 74.8 | |||
GHG (GHG-Gasspeicher Hannover Gesellschaft mbH) | 13.2 | |||
MEGAL (MEGAL Mittel-Europäische-Gasleitungsgesellschaft mbH & Co. KG) | 51.0 | |||
METG (Mittelrheinische Erdgastransportleitungsgesellschaft mbH) | 100.0 | |||
NETG (Nordrheinische Erdgastransportleitungsgesellschaft mbH & Co. KG) | 50.0 | |||
NETRA (NETRA GmbH Norddeutsche Erdgas Transversale & Co. KG) | 40.6 | |||
TENP (Trans Europa Naturgas Pipeline Gesellschaft mbH & Co. KG) | 51.0 |
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Maintained | |||||||||
Total | by E.ON Ruhrgas | ||||||||
Pipelines | km | km | |||||||
Owned by E.ON Ruhrgas | 6,449 | 6,177 | |||||||
Co-owned pipelines | 1,550 | 604 | |||||||
DEUDAN (PC) | 110 | 0 | |||||||
EGL (PC) | 67 | 67 | |||||||
MEGAL (PC) | 1,080 | 1,080 | |||||||
METG (PC) | 425 | 425 | |||||||
NETG (PC) | 285 | 144 | |||||||
NETRA (PC) | 341 | 106 | |||||||
TENP (PC) | 966 | 966 | |||||||
Companies in which E.ON Ruhrgas holds a stake through its subsidiaries ERI and Thüga | — | 2,046 | |||||||
Owned by third parties | — | 1,075 | |||||||
Total in Germany | 11,273 | 12,690 | |||||||
(PC) | project company |
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Installed Capacity | |||||||||||||||||||||
of Compressor Units | |||||||||||||||||||||
Compressor Units | Monitored and | ||||||||||||||||||||
Total Installed | Monitored and | Maintained | |||||||||||||||||||
Compressor | Compressor | Capacity | Maintained by | by E.ON Ruhrgas | |||||||||||||||||
Owned by | Stations | Units | MW | E.ON Ruhrgas | MW | ||||||||||||||||
E.ON Ruhrgas (transportation and storage) | 15 | 44 | 384 | 44 | 384 | ||||||||||||||||
DEUDAN (PC) (transportation) | 2 | 4 | 16 | 0 | 0 | ||||||||||||||||
EGL (PC) (storage) | 1 | 2 | 13 | 0 | 0 | ||||||||||||||||
GHG Hannover (PC) (storage) | 1 | 3 | 4 | 0 | 0 | ||||||||||||||||
MEGAL (PC) (transportation) | 5 | 17 | 179 | 17 | 179 | ||||||||||||||||
METG (PC) (transportation) | 2 | 9 | 99 | 9 | 99 | ||||||||||||||||
NETG (PC) (transportation) | 2 | 5 | 50 | 2 | 20 | ||||||||||||||||
NETRA (PC) (transportation) | 2 | 5 | 42 | 3 | 20 | ||||||||||||||||
TENP (PC) (transportation) | 4 | 15 | 151 | 15 | 151 | ||||||||||||||||
Total in Germany | 34 | 104 | 938 | 90 | 853 | ||||||||||||||||
(PC) | project company |
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E.ON Ruhrgas’ | E.ON Ruhrgas’ | ||||||||||||||||||
E.ON Ruhrgas’ | Share in | Share in | |||||||||||||||||
Share in | Maximum | Storage Facility | |||||||||||||||||
Working | Withdrawal | or in the | Operated by | ||||||||||||||||
Capacity | Rate (thousand | Project Company | E.ON | ||||||||||||||||
Underground Storage Facilities | (million m3) | m3/hour) | Owned by | % | Ruhrgas | ||||||||||||||
Bierwang(P) | 1,300 | 1,200 | E.ON Ruhrgas | 100.0 | Yes | ||||||||||||||
Empelde(C) | 18 | 39 | GHG-Gasspeicher Hannover | ||||||||||||||||
Gesellschaft mbH(PC) | 13.2 | — | |||||||||||||||||
Epe(C) | 1,657 | 2,450 | E.ON Ruhrgas | 100.0 | Yes | ||||||||||||||
Eschenfelden(P) | 48 | 87 | E.ON Ruhrgas/N-ERGIE AG | 66.7 | Yes | ||||||||||||||
Etzel(C) | 383 | 987 | Etzel Gas-Lager GmbH & | ||||||||||||||||
Co. KG(PC) | 74.8 | — | |||||||||||||||||
Hähnlein(P) | 80 | 100 | E.ON Ruhrgas | 100.0 | Yes | ||||||||||||||
Krummhörn(C)(1) | 0 | 0 | E.ON Ruhrgas | 100.0 | Yes | ||||||||||||||
Sandhausen(P) | 15 | 23 | E.ON Ruhrgas/Gasversorgung | ||||||||||||||||
Süddeutschland GmbH | 50.0 | Yes | |||||||||||||||||
Stockstadt(P) | 135 | 135 | E.ON Ruhrgas | 100.0 | Yes | ||||||||||||||
Breitbrunn(P) | 970 | (2) | 520 | RWE Dea AG/ExxonMobil | |||||||||||||||
Gasspeicher Deutschland | |||||||||||||||||||
GmbH(3)/ E.ON Ruhrgas (4) | Leased | (3) | Yes | (4) | |||||||||||||||
Inzenham-West(P) | 500 | 300 | RWE Dea AG | Leased | — | ||||||||||||||
Total | 5,106 | 5,841 | |||||||||||||||||
(C) | salt cavern |
(P) | porous rock |
(PC) | project company |
(1) | Currently out of service for repairs/adjustments. |
(2) | 965 million m3 was contractually guaranteed in 2004/05; 970 million m3 is the current working gas capacity available to E.ON Ruhrgas. |
(3) | Underground section. |
(4) | Above ground part, particularly the storage compressor station. |
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Total 2005 | Total 2004 | ||||||||||||||||
Sale of Gas to: | billion kWh | % | billion kWh | % | |||||||||||||
Distributors | 323.7 | 58.3 | 328.7 | 59.3 | |||||||||||||
Municipal utilities | 160.9 | 29.0 | 156.1 | 28.2 | |||||||||||||
Industrial customers | 70.4 | 12.7 | 69.0 | 12.5 | |||||||||||||
Total | 555.0 | 100.0 | 553.8 | 100.0 | |||||||||||||
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Share held | ||||
by ERI | ||||
Shareholding | % | |||
Ferngas Nordbayern GmbH(1) | 53.10 | |||
Gas-Union GmbH(1) | 25.93 | |||
Saar Ferngas AG(1) | 20.00 |
(1) | Interest held via ERI’s wholly-owned subsidiary RGE Holding GmbH. |
Share held | ||||
by ERI | ||||
Shareholding | % | |||
Gasnor AS, Norway | 14.00 | |||
Nova Naturgas AB, Sweden | 29.59 | |||
Gasum Oy, Finland | 20.00 | |||
AS Eesti Gaas, Estonia | 33.66 | |||
JSC Latvijas Gaze, Latvia | 47.23 | |||
AB Lietuvos Dujos, Lithuania | 38.91 | |||
therminvest Sp.z o.o., Poland(1) | 100.00 | |||
Inwestycyjna Spolka Energetyczna Sp.z o.o. (IRB), Poland | 50.00 | |||
Szczencinska Energetyka Cieplna Sp.z o.o. (SECS), Poland(1) | 32.13 | |||
EUROPGAS a.s., Czech Republic(2) | 50.00 | |||
Colonia-Cluj-Napoca-Energie S.R.L. (CCNE), Romania | 33.33 | |||
E.ON Ruhrgas Mittel- und Osteuropa GmbH(3) | 100.00 | |||
Nafta a.s., Slovakia | 40.27 | |||
S.C. Congaz S.A., Romania | 28.59 | |||
Ekopur d.o.o., Slovenia(4) | 100.00 | |||
SOTEG — Société de Transport de Gaz S.A., Luxembourg | 20.00 | |||
Holdigaz SA, Switzerland | 2.21 |
(1) | The shareholdings in these companies are expected to be transferred to E.DIS energia sp.z o.o. of the Central Europe market unit in 2006. |
(2) | EUROPGAS a.s. holds 50.0 percent of SPP Bohemia a.s. and 48.18 percent of Moravské naftové doly a.s. (MND) in the Czech Republic. |
(3) | E.ON Ruhrgas Mittel- und Osteuropa GmbH has an indirect interest of 24.50 percent in SPP, Slovakia. |
(4) | Ekopur d.o.o. holds 6.52 percent of Geoplin d.o.o. in Slovenia. |
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Share held | ||||
by Thüga | ||||
Shareholding | % | |||
Stadtwerke Hannover Aktiengesellschaft | 24.00 | |||
N-ERGIE Aktiengesellschaft | 39.80 | |||
Mainova Aktiengesellschaft | 24.44 | |||
Gasag Berliner Gaswerke Aktiengesellschaft | 36.85 | |||
badenova AG & Co. KG | 47.30 | |||
HEAG Südhessische Energie AG (HSE) | 40.01 | |||
DREWAG-Stadtwerke Dresden GmbH | 10.00 | |||
Erdgas Südbayern GmbH | 50.00 | |||
Stadtwerke Duisburg AG | 20.00 | |||
Stadtwerke Karlsruhe GmbH | 10.00 |
Share held | ||||
by Thüga | ||||
Shareholding | % | |||
E.ON Vendita S.r.l | 100.00 | |||
Thüga Laghi S.r.l | 100.00 | |||
Thüga Mediterranea S.r.l | 100.00 | |||
Thüga Orobica S.r.l | 100.00 | |||
Thüga Padana S.r.l | 100.00 | |||
Thüga Triveneto S.r.l | 100.00 | |||
G.E.I. S.p.A. | 48.94 | |||
AMGA Azienda Multiservizi S.p.A. | 21.60 |
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Total | Total | ||||||
2005 | 2004 | % | |||||
Sources of Power | million kWh | million kWh | Change | ||||
Own production(1) | 37,255 | 34,916 | +6.7 | ||||
Purchased power from power stations in which E.ON UK has an interest of 50 percent or less | 627 | 2,047 | -69.4 | ||||
Power purchased from other suppliers(2) | 39,224 | 47,087 | -16.7 | ||||
Power used for operating purposes, network losses and pump storage | (2,114) | (1,976) | +7.0 | ||||
Net power supplied(3) | 74,992 | 82,074 | -8.6 | ||||
Sales of Power | |||||||
Mass market sales (residential customers and small and medium sized enterprises) | 37,314 | 36,189 | +3.1 | ||||
Industrial and commercial sales(4) | 22,301 | 26,528 | -15.9 | ||||
Market sales(2) | 15,377 | 19,357 | -20.6 | ||||
Net power sold(3) | 74,992 | 82,074 | -8.6 | ||||
(1) | The increase in own production in 2005 was primarily attributable to the fact that the Killingholme power plant was returned to service and the Enfield power station was acquired in 2005. |
(2) | Power purchased from other suppliers and market sales decreased in 2005 compared with 2004 primarily due to lower sales to industrial and commercial customers and optimization decisions associated with E.ON UK’s hedging strategy. |
(3) | Excluding proprietary trading volumes. For information on proprietary trading volumes, see “— Energy Wholesale — Energy Trading.” |
(4) | During 2005, the industrial and commercial sales business continued to focus on securing profitable customers, which resulted in lower sales volumes in 2005 compared with 2004. |
Total | Total | ||||||
2005 | 2004 | % | |||||
Sources of Gas | million kWh | million kWh | Change | ||||
Long-term gas supply contracts | 48,431 | 49,494 | -2.1 | ||||
Market purchases | 134,041 | 126,400 | +6.0 | ||||
Total gas supplied(1) | 182,472 | 175,894 | +3.7 | ||||
Sale and Use of Gas | |||||||
Gas used for own generation | 40,318 | 39,023 | +3.3 | ||||
Sales to industrial and commercial customers(2) | 32,590 | 35,946 | -9.3 | ||||
Sales to retail mass market customers | 67,671 | 66,221 | +2.2 | ||||
Market sales | 41,893 | 34,704 | +20.7 | ||||
Total gas used and sold(1) | 182,472 | 175,894 | +3.7 | ||||
(1) | Excluding proprietary trading volumes. For information on proprietary trading volumes, see “— Energy Wholesale — Energy Trading.” |
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(2) | During 2005, the industrial and commercial sales business continued to focus on securing profitable customers, which resulted in lower sales volumes in 2005 compared with 2004. |
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• | The U.K.’s renewables obligation required electricity retailers to source an increasing amount of the electricity they supply to retail customers from renewable sources. Under the current regime, for the period from April 1, 2005 until March 31, 2006, the renewables obligation is equal to 5.5 percent, rising to a figure of 15.4 percent by 2015/2016, at which point it is to remain stable until 2026/27. The requirement applies to all retail sales over a twelve-month period beginning on April 1 of each year, and Renewables Obligation Certificates (“ROCs”) are issued to generators as evidence of qualified sourcing. ROCs are tradeable, and retailers who fail to present Ofgem with ROCs representing the full amount of their renewables obligation are required to make a balancing payment in the amount of any shortfall into a buy-out fund. Receipts from the buy-out fund are re-distributed to holders of ROCs. | |
• | The United Kingdom implemented the EU Emissions Trading Directive at the beginning of 2005. The scheme requires companies to have CO2 emission certificates in an amount equal to the CO2 emissions made by their fossil fuel-fired power plants with a thermal input of more than 20 MW. During 2005, the U.K. government made an initial allocation of certificates for the first phase of the scheme (2005 to 2007) to owners of generating facilities, with the total number of certificates being issued equal to less than 90 percent of emissions levels in recent years. As a result, E.ON UK had to buy 4.7 million tons of additional allowances in 2005. | |
• | The application in the United Kingdom of the EU Large Combustion Plant Directive may prevent coal- and oil-powered generation facilities that have not been fitted with specified sulphur oxide and nitrous oxide reduction measures from operating for more than a total of 20,000 hours starting in 2008. |
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�� | E.ON UK’s Share | ||||||||||||||||
Total | Attributable | ||||||||||||||||
Capacity | Capacity | Start-up | |||||||||||||||
Power Plants | Net MW | % | MW | Date | |||||||||||||
Hard Coal | |||||||||||||||||
Ironbridge U1(1) | 485 | 100.0 | 485 | 1970 | |||||||||||||
Ironbridge U2(1) | 485 | 100.0 | 485 | 1970 | |||||||||||||
Kingsnorth U1(1) | 485 | 100.0 | 485 | 1970 | |||||||||||||
Kingsnorth U2(1) | 485 | 100.0 | 485 | 1971 | |||||||||||||
Kingsnorth U3(1) | 485 | 100.0 | 485 | 1972 | |||||||||||||
Kingsnorth U4(1) | 485 | 100.0 | 485 | 1973 | |||||||||||||
Ratcliffe U1(1)(2) | 500 | 100.0 | 500 | 1968 | |||||||||||||
Ratcliffe U2(1)(2) | 500 | 100.0 | 500 | 1969 | |||||||||||||
Ratcliffe U3(1)(2) | 500 | 100.0 | 500 | 1969 | |||||||||||||
Ratcliffe U4(1)(2) | 500 | 100.0 | 500 | 1970 | |||||||||||||
Total | 4,910 | 4,910 | |||||||||||||||
Natural Gas | |||||||||||||||||
Cottam Development Centre (CDC) Module | 400 | 100.0 | 400 | 1999 | |||||||||||||
Connahs Quay U1 | 345 | 100.0 | 345 | 1996 | |||||||||||||
Connahs Quay U2 | 345 | 100.0 | 345 | 1996 | |||||||||||||
Connahs Quay U3 | 345 | 100.0 | 345 | 1996 | |||||||||||||
Connahs Quay U4 | 345 | 100.0 | 345 | 1996 | |||||||||||||
Corby Module | 401 | 50.0 | 200 | 1993 | |||||||||||||
Enfield | 392 | 100.0 | 392 | 2002 | |||||||||||||
Killingholme Mod 1 | 450 | 100.0 | 450 | 1992 | |||||||||||||
Killingholme Mod 2 | 450 | 100.0 | 450 | 1993 | |||||||||||||
Total | 3,473 | 3,272 | |||||||||||||||
Oil | |||||||||||||||||
Grain U1 | 650 | 100.0 | 650 | 1982 | |||||||||||||
Grain U4 | 650 | 100.0 | 650 | 1984 | |||||||||||||
Total | 1,300 | 1,300 | |||||||||||||||
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E.ON UK’s Share | |||||||||||||||||
Total | Attributable | ||||||||||||||||
Capacity | Capacity | Start-up | |||||||||||||||
Power Plants | Net MW | % | MW | Date | |||||||||||||
Other (including hydroelectric and wind farms) | |||||||||||||||||
Grain Aux GT1 | 28 | 100.0 | 28 | 1979 | |||||||||||||
Grain Aux GT4 | 27 | 100.0 | 27 | 1980 | |||||||||||||
Kingsnorth Aux GT1 | 17 | 100.0 | 17 | 1967 | |||||||||||||
Kingsnorth Aux GT4 | 17 | 100.0 | 17 | �� | 1968 | ||||||||||||
Ratcliffe Aux GT2 | 17 | 100.0 | 17 | 1967 | |||||||||||||
Ratcliffe Aux GT4 | 17 | 100.0 | 17 | 1968 | |||||||||||||
Taylors Lane GT2 | 68 | 100.0 | 68 | 1981 | |||||||||||||
Taylors Lane GT3 | 64 | 100.0 | 64 | 1979 | |||||||||||||
Hydroelectric | 50 | 100.0 | 50 | 1962 | |||||||||||||
Wind farms | 197 | various | 183 | various | |||||||||||||
Total | 502 | 488 | |||||||||||||||
CHP schemes | 577 | 100.0 | 577 | various | |||||||||||||
Total Capacity | 10,762 | 10,547 | |||||||||||||||
(1) | Biomass material co-fired during 2005. |
(2) | In June 2005,Ratcliffe-on-Soar power station successfully completed an18-month trial to co-fire petcoke, a mixture of coal and gas. The trial was required by the U.K. Environmental Agency before permission could be given to move to commercial scale co-firing. A report on the trial has been submitted to the Environmental Agency, together with an application to move to commercial scale co-firing, and a decision is expected in 2006. |
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• | Purchasing of coal, gas and oil for power stations; | |
• | Dispatching generation and selling the electrical output and ancillary services provided by E.ON UK’s power stations; | |
• | Purchasing gas and electricity as required for E.ON UK’s retail portfolio; | |
• | Managing the net position and risks of E.ON UK’s generation and retail portfolio; | |
• | Managing renewable obligations for the retail portfolio through long-term purchases and trading of ROCs; | |
• | Purchasing and/or trading of CO2 emission certificates and other environmental products, including Levy Exempt Certificates (issued in relation to the U.K. Climate Change Levy); | |
• | Trading of weather derivatives, which assist in hedging volume variability in E.ON UK’s retail business; and | |
• | Achieving portfolio optimization and risk management. |
2005 | 2004 | 2005 | 2004 | |||||||||||||
Electricity | Electricity | Gas | Gas | |||||||||||||
Proprietary Trading Volumes | billion kWh(1) | billion kWh | billion kWh(1) | billion kWh | ||||||||||||
Energy bought | 10.4 | 20.9 | 36.2 | 86.55 | ||||||||||||
Energy sold | 10.4 | 20.9 | 36.2 | 86.55 | ||||||||||||
Gross volume | 20.8 | 41.8 | 72.4 | 173.1 | ||||||||||||
(1) | The reduction in traded gas and electricity volumes in 2005 was primarily attributable to higher market prices, which reduced the volume of trading E.ON UK could conduct within the risk limits established by the Corporate Center. |
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Total | Total | ||||||||||||
2005 | 2004 | % | |||||||||||
Distribution of Power to | million kWh | million kWh | Change | ||||||||||
Large non-domestic customers | 26,129 | 26,610 | -1.8 | ||||||||||
Domestic and small non-domestic customers | 31,287 | 30,583 | +2.3 | ||||||||||
Total | 57,416 | 57,193 | +0.4 | ||||||||||
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Total 2005 | Total 2004 | % | |||||
Sources of Power | million kWh | million kWh | Change | ||||
Own generation | 34,253 | 33,110 | +3.5 | ||||
Purchased power from jointly owned power stations | 10,398 | 11,030 | -5.7 | ||||
Power purchased from outside sources | 5,921 | 7,376 | -19.7 | ||||
Total power procured(1) | 50,572 | 51,516 | -1.8 | ||||
Power used for operating purposes, network losses and pump storage | (2,001) | (2,054) | -2.6 | ||||
Total | 48,571 | 49,462 | -1.8 | ||||
Sales of Power | |||||||
Residential customers | 8,500 | 9,132 | -6.9 | ||||
Commercial customers | 13,830 | 14,454 | -4.3 | ||||
Sales partners(2)/ Nordpool | 26,241 | 25,876 | +1.4 | ||||
Total(1) | 48,571 | 49,462 | -1.8 | ||||
(1) | Excluding physically-settled electricity trading activities. Nordic’s physically-settled electricity trading activities (including both purchases and sales) amounted to approximately 44 million kWh in each of 2005 and 2004. |
(2) | Sales partners are co-owners in E.ON Nordic’s majority-owned power plants, primarily nuclear power plants, to which E.ON Nordic sells electricity at prices equal to the cost of production. |
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Total 2005 | Total 2004 | % | |||||||||||
Sources of Gas | million kWh | million kWh | Change | ||||||||||
Long-term gas supply contracts | 9,310 | 9,252 | +0.6 | ||||||||||
Market purchases | 281 | 402 | -30.1 | ||||||||||
Total gas supplied | 9,591 | 9,654 | -0.7 | ||||||||||
Sale and Use of Gas | |||||||||||||
Gas used for own generation | 2,624 | 2,539 | +3.4 | ||||||||||
Sales to industrial and distribution customers | 6,729 | 6,963 | -3.4 | ||||||||||
Sales to residential customers | 238 | 152 | +56.6 | ||||||||||
Market sales | 0 | 0 | — | ||||||||||
Total gas used and sold | 9,591 | 9,654 | -0.7 | ||||||||||
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E.ON Sverige’s/E.ON | |||||||||||||||||
Finland’s Share | |||||||||||||||||
Total | Attributable | ||||||||||||||||
Capacity | Capacity | Start-up | |||||||||||||||
Power Plants | Net MW | % | MW | Date | |||||||||||||
Nuclear | |||||||||||||||||
Forsmark 1(S) | 1,018 | 9.3 | 95 | 1980 | |||||||||||||
Forsmark 2(S) | 951 | 9.3 | 88 | 1981 | |||||||||||||
Forsmark 3(S) | 1,190 | 10.8 | 129 | 1985 | |||||||||||||
Oskarshamn I(S) | 467 | 54.5 | 255 | 1972 | |||||||||||||
Oskarshamn II(S) | 602 | 54.5 | 328 | 1974 | |||||||||||||
Oskarshamn III(S) | 1,160 | 54.5 | 632 | 1985 | |||||||||||||
Ringhals 1(S) | 873 | 29.6 | 258 | 1976 | |||||||||||||
Ringhals 2(S) | 870 | 29.6 | 258 | 1975 | |||||||||||||
Ringhals 3(S) | 920 | 29.6 | 272 | 1981 | |||||||||||||
Ringhals 4(S) | 910 | 29.6 | 269 | 1983 | |||||||||||||
Total | 8,961 | 2,584 | |||||||||||||||
Hydroelectric | |||||||||||||||||
Balforsen(S) | 88 | 100.0 | 88 | 1958 | |||||||||||||
Bergeforsen(S) | 160 | 44.0 | 70 | 1955 | |||||||||||||
Bjurfors nedre(S) | 78 | 100.0 | 78 | 1959 | |||||||||||||
Blasjön(S) | 60 | 50.0 | 30 | 1957 | |||||||||||||
Degerforsen(S) | 63 | 100.0 | 63 | 1965 | |||||||||||||
Edensforsen(S) | 67 | 96.5 | 65 | 1956 | |||||||||||||
Edsele(S) | 60 | 100.0 | 60 | 1965 | |||||||||||||
Forsse(S) | 52 | 100.0 | 52 | 1968 | |||||||||||||
Gulsele(S) | 64 | 65.0 | 42 | 1955 | |||||||||||||
Hällby(S) | 84 | 65.0 | 55 | 1970 | |||||||||||||
Hammarforsen(S) | 79 | 100.0 | 79 | 1928 | |||||||||||||
Harrsele(S) | 223 | 50.6 | 113 | 1957 | |||||||||||||
Hjälta(S) | 178 | 100.0 | 178 | 1949 | |||||||||||||
Järnvägsforsen(S) | 100 | 94.9 | 95 | 1975 | |||||||||||||
Korselbränna(S) | 130 | 100.0 | 130 | 1961 | |||||||||||||
Moforsen(S) | 135 | 100.0 | 135 | 1968 | |||||||||||||
Olden (Langan)(S) | 112 | 100.0 | 112 | 1974 | |||||||||||||
Pengfors(S) | 52 | 65.0 | 34 | 1954 | |||||||||||||
Ramsele(S) | 157 | 100.0 | 157 | 1958 | |||||||||||||
Rätan(S) | 60 | 100.0 | 60 | 1968 | |||||||||||||
Sollefteaforsen(S) | 61 | 50.0 | 31 | Tba | |||||||||||||
Stensjön (Harkan)(S) | 95 | 50.0 | 48 | 1968 | |||||||||||||
Storfinnforsen(S) | 112 | 100.0 | 112 | 1953 |
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E.ON Sverige’s/E.ON | |||||||||||||||||
Finland’s Share | |||||||||||||||||
Total | Attributable | ||||||||||||||||
Capacity | Capacity | Start-up | |||||||||||||||
Power Plants | Net MW | % | MW | Date | |||||||||||||
Hydroelectric (continued) | |||||||||||||||||
Trangfors(S) | 73 | 100.0 | 73 | 1975 | |||||||||||||
Other (<50 MW installed capacity) | 874 | n/a | 811 | n/a | |||||||||||||
Total | 3,217 | 2,771 | |||||||||||||||
Fuel Oil | |||||||||||||||||
Barsebäck GT(S) | 84 | 100.0 | 84 | 1974 | |||||||||||||
Bravalla(S) | 240 | 100.0 | 240 | 1972 | |||||||||||||
Halmstad G11(S) | 78 | 100.0 | 78 | 1973 | |||||||||||||
Halmstad G12(S) | 172 | 100.0 | 172 | 1993 | |||||||||||||
Karlshamn G1(S) | 332 | 70.0 | 232 | 1971 | |||||||||||||
Karlshamn G2(S) | 332 | 70.0 | 232 | 1971 | |||||||||||||
Karlshamn G3(S) | 326 | 70.0 | 228 | 1973 | |||||||||||||
Karskär G4(S) | 125 | 50.0 | 63 | 1968 | |||||||||||||
Öresundsverket GT(S) | 126 | 100.0 | 126 | 1971 | |||||||||||||
Oskarshamn GT(S) | 80 | 54.5 | 44 | 1973 | |||||||||||||
Other (<50 MW installed capacity) | 100 | n/a | 64 | n/a | |||||||||||||
Total | 1,995 | 1,563 | |||||||||||||||
Natural Gas | |||||||||||||||||
Heleneholm G11, G12(S)(CHP) | 130 | 100.0 | 130 | 1966+1970 | |||||||||||||
Suomenoja GT(1)(FIN) | 50 | 100.0 | 50 | 1989 | |||||||||||||
Total | 180 | 180 | |||||||||||||||
Hard Coal | |||||||||||||||||
Suomenoja(1)(FIN) | 80 | 100.0 | 80 | 1977 | |||||||||||||
Wind Power | |||||||||||||||||
Sweden | 19 | n/a | 19 | n/a | |||||||||||||
Denmark | 166 | n/a | 33 | n/a | |||||||||||||
Total | 185 | 52 | |||||||||||||||
Other Power Plants | |||||||||||||||||
Abyverket G1, G2, G3(S)(CHP) | 151 | 100.0 | 151 | 1962-1974 | |||||||||||||
Händelö (Norrköping)(S)(CHP) | 100 | 100.0 | 100 | 1983 | |||||||||||||
Joensuu Bio(1)(FIN) | 65 | 100.0 | 65 | 1986 | |||||||||||||
Karskär G3(S) | 48 | 50.0 | 24 | 1968 | |||||||||||||
Total | 364 | 340 | |||||||||||||||
Shutdown | |||||||||||||||||
Barsebäck 1(S)(Nuclear) | — | 25.8 | — | 1975 | |||||||||||||
Barsebäck 2(S)(Nuclear) | — | 25.8 | — | 1977 | |||||||||||||
Total | 14,982 | 7,570 | |||||||||||||||
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(1) | Power plant of E.ON Finland. |
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2005 | 2004 | ||||||||||||
million | million | ||||||||||||
Trading of Power | kWh | kWh | % Change | ||||||||||
Power sold | 53,503 | 56,758 | -5.7 | ||||||||||
Power purchased | 56,225 | 48,764 | +15.3 | ||||||||||
Total | 109,728 | 105,522 | +4.0 | ||||||||||
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E.ON U.S.’s Share | |||||||||||||||||
Total | Attributable | ||||||||||||||||
Capacity | Capacity | Start-up | |||||||||||||||
Power Plants | Net MW | % | MW | Date | |||||||||||||
Hard Coal | |||||||||||||||||
Cane Run 4(1) | 155 | 100.0 | 155 | 1962 | |||||||||||||
Cane Run 5(1) | 168 | 100.0 | 168 | 1966 | |||||||||||||
Cane Run 6(1) | 240 | 100.0 | 240 | 1969 | |||||||||||||
E.W. Brown 1(2) | 101 | 100.0 | 101 | 1957 | |||||||||||||
E.W. Brown 2(2) | 167 | 100.0 | 167 | 1963 | |||||||||||||
E.W. Brown 3(2) | 429 | 100.0 | 429 | 1971 | |||||||||||||
Ghent 1(2) | 475 | 100.0 | 475 | 1974 | |||||||||||||
Ghent 2(2) | 484 | 100.0 | 484 | 1977 | |||||||||||||
Ghent 3(2) | 493 | 100.0 | 493 | 1981 | |||||||||||||
Ghent 4(2) | 493 | 100.0 | 493 | 1984 | |||||||||||||
Green River 3(2) | 68 | 100.0 | 68 | 1954 | |||||||||||||
Green River 4(2) | 95 | 100.0 | 95 | 1959 | |||||||||||||
Mill Creek 1(1) | 303 | 100.0 | 303 | 1972 | |||||||||||||
Mill Creek 2(1) | 301 | 100.0 | 301 | 1974 | |||||||||||||
Mill Creek 3(1) | 391 | 100.0 | 391 | 1978 | |||||||||||||
Mill Creek 4(1) | 477 | 100.0 | 477 | 1982 | |||||||||||||
Trimble County(1) | 511 | 75.0 | 383 | 1990 | |||||||||||||
Tyrone 3(2) | 71 | 100.0 | 71 | 1953 | |||||||||||||
Total | 5,422 | 5,294 | |||||||||||||||
Natural Gas | |||||||||||||||||
Cane Run 11(1) | 14 | 100.0 | 14 | 1968 | |||||||||||||
E.W. Brown 5(3) | 117 | 100.0 | 117 | 2001 | |||||||||||||
E.W. Brown 6(3) | 154 | 100.0 | 154 | 1999 | |||||||||||||
E.W. Brown 7(3) | 154 | 100.0 | 154 | 1999 | |||||||||||||
E.W. Brown 8(2) | 106 | 100.0 | 106 | 1995 | |||||||||||||
E.W. Brown 9(2) | 106 | 100.0 | 106 | 1994 |
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E.ON U.S.’s Share | |||||||||||||||||
Total | Attributable | ||||||||||||||||
Capacity | Capacity | Start-up | |||||||||||||||
Power Plants | Net MW | % | MW | Date | |||||||||||||
Natural Gas (continued) | |||||||||||||||||
E.W. Brown 10(2) | 106 | 100.0 | 106 | 1995 | |||||||||||||
E.W. Brown 11(2) | 106 | 100.0 | 106 | 1996 | |||||||||||||
E.W. Brown IAC(3) | 98 | 100.0 | 98 | 2000 | |||||||||||||
Haefling 1(2) | 12 | 100.0 | 12 | 1970 | |||||||||||||
Haefling 2(2) | 12 | 100.0 | 12 | 1970 | |||||||||||||
Haefling 3(2) | 12 | 100.0 | 12 | 1970 | |||||||||||||
Paddy’s Run 11(1) | 12 | 100.0 | 12 | 1968 | |||||||||||||
Paddy’s Run 12(1) | 23 | 100.0 | 23 | 1968 | |||||||||||||
Paddy’s Run 13(3) | 158 | 100.0 | 158 | 2001 | |||||||||||||
Trimble County 5(3) | 160 | 100.0 | 160 | 2002 | |||||||||||||
Trimble County 6(3) | 160 | 100.0 | 160 | 2002 | |||||||||||||
Trimble County 7(3) | 160 | 100.0 | 160 | 2004 | |||||||||||||
Trimble County 8(3) | 160 | 100.0 | 160 | 2004 | |||||||||||||
Trimble County 9(3) | 160 | 100.0 | 160 | 2004 | |||||||||||||
Trimble County 10(3) | 160 | 100.0 | 160 | 2004 | |||||||||||||
Waterside 7(1) | 11 | 100.0 | 11 | 1964 | |||||||||||||
Waterside 8(1) | 11 | 100.0 | 11 | 1964 | |||||||||||||
Zorn 1(1) | 14 | 100.0 | 14 | 1969 | |||||||||||||
Total | 2,186 | 2,186 | |||||||||||||||
Oil | |||||||||||||||||
Tyrone Unit 1(2) | 27 | 100.0 | 27 | 1947 | |||||||||||||
Tyrone Unit 2(2) | 31 | 100.0 | 31 | 1948 | |||||||||||||
Total | 58 | 58 | |||||||||||||||
Hydroelectric | |||||||||||||||||
Dix Dam(2) | 24 | 100.0 | 24 | 1925 | |||||||||||||
Ohio Falls(1) | 48 | 100.0 | 48 | 1928 | |||||||||||||
Total | 72 | 72 | |||||||||||||||
E.ON U.S. Regulated Business Total | 7,738 | 7,610 | |||||||||||||||
Shutdown | |||||||||||||||||
Green River 1(2) | 22 | 100.0 | 22 | 1950 | |||||||||||||
Green River 2(2) | 22 | 100.0 | 22 | 1950 | |||||||||||||
Total | 44 | 44 | |||||||||||||||
(1) | Power stations owned by LG&E. |
(2) | Power stations owned by KU. |
(3) | Power stations jointly owned by LG&E and KU. |
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Total 2005 | Total 2004 | ||||||||
Sales of Electric Power to | million kWh | million kWh | |||||||
Residential | 10,864 | 10,084 | |||||||
Commercial and industrial customers | 16,684 | 16,276 | |||||||
Municipals | 2,014 | 1,959 | |||||||
Other retail | 3,720 | 3,576 | |||||||
Off-system sales | 4,434 | 4,199 | |||||||
Total | 37,716 | 36,094 | |||||||
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Technology | Construction | Consumer | Specialty | |||||||
Specialists | Chemicals | Solutions | Materials | |||||||
Building Blocks | Admixture Systems Europe | Superabsorber | Coatings & Colorants | |||||||
Exclusive Synthesis & Catalysts | Admixture Systems North America | Care & Surface Specialties | High Performance Polymers | |||||||
C4-Chemistry | Admixture Systems Asia/Pacific | Feed Additives | Methacrylates | |||||||
Aerosil & Silanes | Construction Systems Europe | Specialty Acrylics | ||||||||
Advanced Fillers & Pigments | Construction Systems Americas |
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• | The contribution of each energy source to the overall fuel mix of the supplier over the preceding year; and | |
• | A reference to where information is publicly available on the environmental impact of the supplier’s activities, including the amount of CO2 and radioactive waste produced. |
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• | Member states must adopt adequate minimum security of supply standards, and | |
• | A “three step procedure” will take effect in the event of a major supply disruption for a significant period of time. Under the “three step procedure,” the gas industry should take measures as a first response to such a disruption, followed by national measures taken by member states. In the event of inadequate measures at the national level, the Gas Coordination Group, consisting of representatives of member states, the gas industry and relevant consumers under the chairmanship of the European Commission, would then decide on necessary measures. |
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• | Fixed charges for renewable energies: Charges for renewable energies are fixed. For wind turbines coming online in 2006, the charge is fixed at 8.36€cent/kWh. This charge is limited in time, with a general term of five years that may be extended up to 20 years depending upon the actual production volume of the installation. After five years, the charge is reduced to 5.28€cent/kWh if 150 percent or more of a reference production, which is the potential production of the installed wind turbine operating with a constant wind speed of five meters per second over five years, has been produced. In addition, the fixed charge is reduced by two percent for new wind turbines every year. For wind turbines coming online in 2007, this means a reduction to 8.19€cent/kWh and 5.17€cent/kWh respectively. | |
• | National burden sharing: The Renewable Energy Law assumes that the subsidy obligation would be passed on in full to the supplying companies. At the transmission company level, there is an equalization process covering the whole country. Each transmission company first determines how much electricity it takes up under the Renewable Energy Law and how much electricity in total flows in its region to end users. An equalization will then be effected among all transmission companies so that all transmission companies take on and subsidize proportionally equivalent amounts of renewable electricity under the statute. The transmission company will then pass these quantities of electricity and the corresponding costs on to the suppliers delivering electricity to end users in its region in proportion to their respective sales. |
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• | CHP plants that were commissioned before 1990 received 1.53€cent/kWh in 2002 and 2003 and 1.38 €cent/kWh in 2004 and 2005, and will receive 0.97€cent/kWh in 2006; | |
• | CHP plants that were commissioned after 1990 received 1.53€cent/kWh in 2002 and 2003 and 1.38 €cent/kWh in 2004 and 2005, and will receive 1.23€cent/kWh in 2006 and 2007, 0.82€cent/kWh in 2008, and 0.56€cent/kWh in 2009; | |
• | CHP plants that are modernized received 1.74€cent/kWh in 2002, 2003 and 2004 and 1.69€cent/kWh in 2005, and will receive 1.69€cent/kWh in 2006, 1.64€cent/kWh in 2007 and 2008, and 1.59€cent/kWh in 2009 and 2010; and | |
• | Small CHP plants with an installed capacity of less than two MW received 2.56€cent/kWh in 2002 and 2003 and 2.4€cent/kWh in 2004 and 2005, and will receive 2.25€cent/kWh in 2006 and 2007, 2.1€cent/kWh in 2008 and 2009, and 1.94€cent/kWh in 2010. |
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Percentage | Percentage | |||||||||||
Country of | Ownership Interest | Voting Interest | ||||||||||
Name of Subsidiary | Incorporation | held by E.ON | held by E.ON | |||||||||
E.ON Energie AG (energy) | Germany | 100.0 | % | 100.0 | % | |||||||
E.ON Ruhrgas AG (energy) | Germany | 100.0 | % | 100.0 | % | |||||||
E.ON UK plc (energy) | U.K. | 100.0 | % | 100.0 | % | |||||||
E.ON Nordic AB (energy) | Sweden | 100.0 | % | 100.0 | % | |||||||
E.ON U.S. LLC (energy) | U.S.A. | 100.0 | % | 100.0 | % |
Central Europe |
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Item 4A. | Unresolved Staff Comments. |
Item 5. | Operating and Financial Review and Prospects. |
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• | In July 2003, E.ON Energie and E.ON Ruhrgas each agreed to sell a 22.0 percent stake in Bayerngas to the municipal utilities of the cities of Munich, Augsburg, Regensburg and Ingolstadt, and to the city of Landshut, for a total of€127 million. The transaction was completed in November 2003. E.ON Energie realized a gain on the disposal in the amount of€22 million. No gain was realized on the sale of the E.ON Ruhrgas stake, as these shares had been recorded at their fair value at the time of E.ON’s acquisition of Ruhrgas. | |
• | In September 2003, E.ON Energie sold its 80.5 percent interest in Gelsenwasser to a joint venture company owned by the municipal utilities of the cities of Dortmund and Bochum. Gelsenwasser was accounted for as a discontinued operation in the Consolidated Financial Statements. For further information, see “Discontinued Operations” below. |
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• | In October 2003, E.ON Energie transferred its 5.26 percent stake in VNG to E.ON Ruhrgas, which already owned an interest in this Leipzig-based gas distributor. In December 2003, E.ON Ruhrgas agreed to sell 32.1 percent of VNG to EWE Aktiengesellschaft (“EWE”), and offered its remaining 10.0 percent stake in VNG to eleven municipalities in eastern Germany for the same price per share. The total consideration for the sale of the entire interest was approximately€899 million. E.ON Energie realized a gain of approximately€60 million on its stake. No gain was realized on the sale of the E.ON Ruhrgas stake, as these shares had been recorded at their fair value at the time of E.ON’s acquisition of Ruhrgas. The sales were subject to the fulfillment of a number of conditions and were completed in January 2004. | |
• | In November 2003, E.ON Energie divested its 100 percent interest in E.ON-Energiebeteiligungs-Gesellschaft to EWE for€305 million. E.ON Energiebeteiligungs-Gesellschaft had a 32.36 percent interest in swb, comprising all of the shares previously held by E.ON Energie and E.ON Ruhrgas. E.ON Energie realized a gain on the disposal in the amount of€85 million. No gain was realized on the sale of the E.ON Ruhrgas stake, as these shares had been recorded at their fair value at the time of E.ON’s acquisition of Ruhrgas. | |
• | In December 2003, E.ON concluded an agreement to divest its stake in EWE. E.ON Energie’s 27.4 percent stake in EWE was acquired by EWE’s majority shareholders Energieverband Elbe-Weser Beteiligungsholding GmbH and Weser-Ems Energiebeteiligungen GmbH for total consideration of approximately€520 million. E.ON recorded a gain of€257 million on the disposal, which was completed in January 2004. |
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• | Currency, electricity, gas, oil and coal forward contracts, swaps, and emission rights derivatives are valued separately at future rates or market prices as of the balance sheet date. The fair values of spot and forward contracts are based on spot prices that consider forward premiums or discounts from quoted prices in the relevant markets. | |
• | Market prices for currency, electricity and gas options are obtained using standard option pricing models commonly used in the market. The fair values of caps, floors, and collars are determined on the basis of quoted market prices or on calculations based on option pricing models. | |
• | The fair values of existing instruments to hedge interest rate risk are determined by discounting future cash flows using market interest rates over the remaining term of the instrument. Discounted cash values are determined for interest rate, cross-currency and cross-currency/interest rate swaps for each individual transaction as of the balance sheet date. Interest income is considered with an effect on current results at the date of payment or accrual. | |
• | Equity swaps are valued on the basis of the stock prices of the underlying equities, taking into consideration any financing components. | |
• | Exchange-traded energy future and option contracts are valued individually at daily settlement prices determined on the futures markets that are published by their respective clearing houses. Initial margins paid are disclosed under other assets. Variation margins received or paid during the term of such contracts are stated under other liabilities or other assets, respectively, and are accounted for with an impact on earnings at settlement or realization. | |
• | Certain long-term commodity contracts are valued by the use of valuation models that include average probabilities and take into account individual contract details and variables. |
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• | SFAS No. 123, Share-Based Payment; | |
• | SFAS No. 154, Accounting Changes and Error Corrections — a replacement of APB Opinion No. 29 and FASB Statement No. 3; and | |
• | SFAS No. 155, Accounting for Certain Hybrid Financial Instruments — an amendment of FASB Statements No. 133 and 140. |
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2005 | 2004 | 2003 | |||||||||||||||||||||||
Adjusted | Adjusted | Adjusted | |||||||||||||||||||||||
Sales | EBIT | Sales | EBIT | Sales | EBIT | ||||||||||||||||||||
(€ in millions) | |||||||||||||||||||||||||
Central Europe(1)(2) | 24,295 | 3,930 | 20,752 | 3,602 | 19,253 | 2,979 | |||||||||||||||||||
Pan-European Gas(2)(3) | 17,914 | 1,536 | 13,227 | 1,344 | 11,919 | 1,401 | |||||||||||||||||||
U.K. | 10,176 | 963 | 8,490 | 1,017 | 7,923 | 610 | |||||||||||||||||||
Nordic(4) | 3,471 | 806 | 3,347 | 701 | 2,824 | 546 | |||||||||||||||||||
U.S. Midwest(2) | 2,045 | 365 | 1,718 | 354 | 1,771 | 318 | |||||||||||||||||||
Corporate Center(2)(5) | (1,502 | ) | (399 | ) | (792 | ) | (338 | ) | (575 | ) | (323 | ) | |||||||||||||
Core Energy Business | 56,399 | 7,201 | 46,742 | 6,680 | 43,115 | 5,531 | |||||||||||||||||||
Other Activities(2)(6) | — | 132 | — | 107 | 994 | 176 | |||||||||||||||||||
Total | 56,399 | 7,333 | 46,742 | 6,787 | 44,109 | 5,707 | |||||||||||||||||||
(1) | Sales include electricity taxes of€1,049 million in 2005,€1,051 million in 2004 and€1,015 million in 2003. |
(2) | Excludes the sales and adjusted EBIT of certain activities now accounted for as discontinued operations. For more details, see “— Acquisitions and Dispositions — Discontinued Operations” and Note 4 of the Notes to Consolidated Financial Statements. |
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(3) | Includes the results of the former Ruhrgas activities from the date of consolidation on February 1, 2003. Sales include natural gas and electricity taxes of€3,110 million in 2005,€2,923 million in 2004 and€2,555 million in 2003. |
(4) | Sales include electricity and natural gas taxes of€402 million in 2005,€395 million in 2004 and€324 million in 2003. |
(5) | Includes primarily the parent company and effects from consolidation (including the elimination of intersegment sales), as well as the results of its remaining telecommunications interests, as explained in “Item 4. Information on the Company — Business Overview — Introduction.” Sales between companies in the same market unit are eliminated in calculating sales on the market unit level. |
(6) | In 2003, includes sales of Degussa for the month of January only, prior to its deconsolidation. For more details, see “Item 4. Information on the Company — Business Overview — Other Activities — Degussa” and Note 4 of the Notes to Consolidated Financial Statements. |
2005 | 2004 | 2003 | ||||||||||
(€ in millions) | ||||||||||||
Adjusted EBIT | 7,333 | 6,787 | 5,707 | |||||||||
Adjusted interest income, net | (1,027 | ) | (1,031 | ) | (1,515 | ) | ||||||
Net book gains | 491 | 589 | 1,257 | |||||||||
Cost-management and restructuring expenses | (29 | ) | (100 | ) | (479 | ) | ||||||
Other non-operating results | 440 | 110 | 195 | |||||||||
Income/(loss) from continuing operations before income taxes and minority interests | 7,208 | 6,355 | 5,165 | |||||||||
Income taxes | (2,276 | ) | (1,850 | ) | (1,145 | ) | ||||||
Minority interests | (553 | ) | (478 | ) | (445 | ) | ||||||
Income/(loss) from continuing operations | 4,379 | 4,027 | 3,575 | |||||||||
Income/(loss) from discontinued operations | 3,035 | 312 | 1,512 | |||||||||
Cumulative effect of change in accounting principles | (7 | ) | — | (440 | ) | |||||||
Net income | 7,407 | 4,339 | 4,647 | |||||||||
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2005 | 2004 | |||||||
(€ in millions) | ||||||||
Interest income and similar expenses (net) as shown in Note 6 of the Notes to Consolidated Financial Statements | (736 | ) | (1,062 | ) | ||||
(+) Non-operating interest income, net(1) | (39 | ) | 151 | |||||
(–) Interest portion of long-term provisions | 252 | 120 | ||||||
Adjusted interest income, net | (1,027 | ) | (1,031 | ) | ||||
(1) | This net figure is calculated by adding in non-operating interest expense and subtracting non-operating interest income. |
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Percent | ||||||||||||||
2005 | 2004 | Change | ||||||||||||
(€ in millions) | ||||||||||||||
Central Europe West | 20,408 | 17,576 | +16.1 | |||||||||||
Power | 16,945 | 14,597 | +16.1 | |||||||||||
Gas | 3,463 | 2,979 | +16.2 | |||||||||||
Central Europe East | 2,618 | 1,877 | +39.5 | |||||||||||
Other/ Consolidation | 220 | 248 | -11.3 | |||||||||||
Total | 23,246 | 19,701 | +18.0 | |||||||||||
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Percent | ||||||||||||||
2005 | 2004 | Change | ||||||||||||
(€ in millions) | ||||||||||||||
Central Europe West | 3,696 | 3,311 | +11.6 | |||||||||||
Power | 3,389 | 2,996 | +13.1 | |||||||||||
Gas | 307 | 315 | -2.5 | |||||||||||
Central Europe East | 237 | 235 | +0.9 | |||||||||||
Other/ Consolidation | (3 | ) | 56 | — | ||||||||||
Total | 3,930 | 3,602 | +9.1 | |||||||||||
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Percent | |||||||||||||
2005 | 2004 | Change | |||||||||||
(€ in millions) | |||||||||||||
Up-/ Midstream | 13,380 | 9,274 | +44.3 | ||||||||||
Downstream | 1,848 | 1,358 | +36.1 | ||||||||||
Other/ Consolidation | (424 | ) | (328 | ) | -29.3 | ||||||||
Total | 14,804 | 10,304 | +43.7 | ||||||||||
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Percent | |||||||||||||
2005 | 2004 | Change | |||||||||||
(€ in millions) | |||||||||||||
Up-/ Midstream | 988 | 862 | +14.6 | ||||||||||
Downstream Shareholdings | 551 | 486 | +13.4 | ||||||||||
Other/ Consolidation | (3 | ) | (4 | ) | +25.0 | ||||||||
Total | 1,536 | 1,344 | +14.3 | ||||||||||
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Percent | |||||||||||||
2005 | 2004 | Change | |||||||||||
(€ in millions) | |||||||||||||
Non-regulated Business | 9,553 | 7,788 | +22.7 | ||||||||||
Regulated Business | 813 | 941 | -13.6 | ||||||||||
Other/ Consolidation | (190 | ) | (239 | ) | +20.5 | ||||||||
Total | 10,176 | 8,490 | +19.9 | ||||||||||
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Percent | |||||||||||||
2005 | 2004 | Change | |||||||||||
(€ in millions) | |||||||||||||
Non-regulated Business | 661 | 626 | +5.6 | ||||||||||
Regulated Business | 452 | 446 | +1.4 | ||||||||||
Other/ Consolidation | (150 | ) | (55 | ) | -172.7 | ||||||||
Total | 963 | 1,017 | -5.3 | ||||||||||
Nordic |
Percent | |||||||||||||
2005 | 2004 | Change | |||||||||||
(€ in millions) | |||||||||||||
Sweden | 2,821 | 2,714 | +3.9 | ||||||||||
Finland | 248 | 238 | +4.2 | ||||||||||
Total | 3,069 | 2,952 | +4.0 | ||||||||||
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Percent | |||||||||||||
2005 | 2004 | Change | |||||||||||
(€ in millions) | |||||||||||||
Sweden | 765 | 662 | +15.6 | ||||||||||
Finland | 41 | 39 | +5.1 | ||||||||||
Total | 806 | 701 | +15.0 | ||||||||||
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Percent | |||||||||||||
2005 | 2004 | Change | |||||||||||
(€ in millions) | |||||||||||||
Regulated Business | 1,965 | 1,643 | +19.6 | ||||||||||
Non-regulated Business | 80 | 75 | +6.7 | ||||||||||
Total | 2,045 | 1,718 | +19.0 | ||||||||||
Percent | |||||||||||||
2005 | 2004 | Change | |||||||||||
(€ in millions) | |||||||||||||
Regulated Business | 351 | 339 | +3.5 | ||||||||||
Non-regulated Business | 14 | 15 | -6.7 | ||||||||||
Total | 365 | 354 | +3.1 | ||||||||||
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2004 | 2003 | |||||||
(€ in millions) | ||||||||
Interest income and similar expenses (net) as shown in Note 6 of the Notes to Consolidated Financial Statements | (1,062 | ) | (978 | ) | ||||
(+) Non-operating interest income, net(1) | 151 | (62 | ) | |||||
(–) Interest portion of long-term provisions | 120 | 475 | ||||||
Adjusted interest income, net | (1,031 | ) | (1,515 | ) | ||||
(1) | This net figure is calculated by adding in non-operating interest expense and subtracting non-operating interest income. |
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Percent | ||||||||||||||
2004 | 2003(1) | Change | ||||||||||||
(€ in millions) | ||||||||||||||
Central Europe West | 17,576 | 16,814 | +4.5 | |||||||||||
Power | 14,597 | 13,662 | +6.8 | |||||||||||
Gas | 2,979 | 3,152 | -5.5 | |||||||||||
Central Europe East | 1,877 | 1,308 | +43.5 | |||||||||||
Other/ Consolidation | 248 | 116 | +113.8 | |||||||||||
Total | 19,701 | 18,238 | +8.0 | |||||||||||
(1) | Excludes sales of Thüga and the activities transferred to the Pan-European Gas market unit and those of E.ON Sverige and the other businesses of E.ON Nordic. |
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Percent | ||||||||||||||
2004 | 2003(1) | Change | ||||||||||||
(€ in millions) | ||||||||||||||
Central Europe West | 3,311 | 2,819 | +17.5 | |||||||||||
Power | 2,996 | 2,530 | +18.4 | |||||||||||
Gas | 315 | 289 | +9.0 | |||||||||||
Central Europe East | 235 | 172 | +36.6 | |||||||||||
Other/ Consolidation | 56 | (12 | ) | — | ||||||||||
Total | 3,602 | 2,979 | +20.9 | |||||||||||
(1) | Excludes results of Thüga and the activities transferred to the Pan-European Gas market unit and those of E.ON Sverige and the other businesses of E.ON Nordic. |
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Percent | |||||||||||||
2004 | 2003(1) | Change | |||||||||||
(€ in millions) | |||||||||||||
Up-/ Midstream | 9,274 | 8,360 | +10.9 | ||||||||||
Downstream | 1,358 | 1,326 | +2.4 | ||||||||||
Other/ Consolidation | (328 | ) | (322 | ) | -1.9 | ||||||||
Total | 10,304 | 9,364 | +10.0 | ||||||||||
(1) | Includes sales of the former Ruhrgas activities for the period from February 1 to December 31 and those of Thüga and the other transferred activities for the full year. |
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Percent | |||||||||||||
2004 | 2003(1) | Change | |||||||||||
(€ in millions) | |||||||||||||
Up-/ Midstream | 862 | 923 | -6.6 | ||||||||||
Downstream Shareholdings | 486 | 484 | +0.4 | ||||||||||
Other/ Consolidation | (4 | ) | (6 | ) | +33.3 | ||||||||
Total | 1,344 | 1,401 | -4.1 | ||||||||||
(1) | Includes results of the former Ruhrgas activities for the period from February 1 to December 31 and those of Thüga and the other transferred activities for the full year. |
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U.K. |
Percent | |||||||||||||
2004 | 2003 | Change | |||||||||||
(€ in millions) | |||||||||||||
Non-regulated Business | 7,788 | 7,682 | +1.4 | ||||||||||
Regulated Business | 941 | 438 | +114.8 | ||||||||||
Other/ Consolidation | (239 | ) | (197 | ) | -21.3 | ||||||||
Total | 8,490 | 7,923 | +7.2 | ||||||||||
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Percent | |||||||||||||
2004 | 2003 | Change | |||||||||||
(€ in millions) | |||||||||||||
Non-regulated Business | 626 | 412 | +51.9 | ||||||||||
Regulated Business | 446 | 225 | +98.2 | ||||||||||
Other/ Consolidation | (55 | ) | (27 | ) | -103.7 | ||||||||
Total | 1,017 | 610 | +66.7 | ||||||||||
Percent | |||||||||||||
2004 | 2003 | Change | |||||||||||
(€ in millions) | |||||||||||||
Sweden | 2,714 | 2,216 | +22.5 | ||||||||||
Finland | 238 | 284 | -16.2 | ||||||||||
Total | 2,952 | 2,500 | +18.1 | ||||||||||
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Percent | |||||||||||||
2004 | 2003 | Change | |||||||||||
(€ in millions) | |||||||||||||
Sweden | 662 | 484 | +36.8 | ||||||||||
Finland | 39 | 62 | +37.1 | ||||||||||
Total | 701 | 546 | +28.4 | ||||||||||
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Percent | |||||||||||||
2004 | 2003 | Change | |||||||||||
(€ in millions) | |||||||||||||
Regulated Business | 1,643 | 1,663 | -1.2 | ||||||||||
Non-regulated Business | 75 | 108 | -30.6 | ||||||||||
Total | 1,718 | 1,771 | -3.0 | ||||||||||
Percent | |||||||||||||
2004 | 2003 | Change | |||||||||||
(€ in millions) | |||||||||||||
Regulated Business | 339 | 306 | +10.8 | ||||||||||
Non-regulated Business | 15 | 12 | +25.0 | ||||||||||
Total | 354 | 318 | +11.3 | ||||||||||
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2005 | 2004 | 2003 | ||||||||||||||||||||||||
Cash from | Capital | Cash from | Capital | Cash from | Capital | |||||||||||||||||||||
Operations | Expenditures | Operations | Expenditures | Operations | Expenditures | |||||||||||||||||||||
(€ in millions) | ||||||||||||||||||||||||||
Central Europe(2) | 3,020 | 2,177 | 2,938 | 2,527 | 4,081 | 2,126 | ||||||||||||||||||||
Pan-European Gas(2) | 1,999 | 531 | 903 | 614 | 942 | (3) | 611 | (3) | ||||||||||||||||||
U.K. | 101 | 926 | 633 | 503 | 315 | 388 | ||||||||||||||||||||
Nordic | 746 | 538 | 957 | 740 | 773 | 1,265 | ||||||||||||||||||||
U.S. Midwest(2) | 214 | 227 | 152 | 247 | 154 | 411 | ||||||||||||||||||||
Corporate Center(2) | 521 | (62 | ) | 257 | 478 | (865 | ) | 4,176 | (4) | |||||||||||||||||
Core Energy Business | 6,601 | 4,337 | 5,840 | 5,109 | 5,400 | 8,977 | ||||||||||||||||||||
Other Activities(2) | — | — | — | — | (93 | ) | 36 | |||||||||||||||||||
Total | 6,601 | 4,337 | 5,840 | 5,109 | 5,307 | 9,013 | ||||||||||||||||||||
(1) | For a detailed description of capital expenditures by purchases of financial assets and purchases of other fixed assets, see Note 27 of the Notes to Consolidated Financial Statements. |
(2) | Excludes the cash from operations and capital expenditures of certain activities now accounted for as discontinued operations. For more details, see “— Acquisitions and Dispositions — Discontinued Operations” and Note 4 of the Notes to Consolidated Financial Statements. |
(3) | Includes the cash flows of the former Ruhrgas activities for the period from February 1 to December 31 and those of Thüga and other transferred activities for the full year. |
(4) | Includes the acquisition of shares of Ruhrgas in 2003. |
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Fair value of contracts outstanding at the beginning of the period | 382.5 | |||
Change to scope of consolidation | 20.6 | |||
Contracts realized or otherwise settled during the period | (166.0 | ) | ||
Fair value of new contracts entered into during the period | 175.2 | |||
Changes in fair values attributable to changes in valuation techniques and assumptions | 4.7 | |||
Other changes in fair values | 1,057.3 | |||
Fair value of contracts outstanding at the end of the period | 1,474.3 | |||
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Fair Value of Contracts at Period-End | ||||||||||||||||||||
Maturity | Maturity in | |||||||||||||||||||
less than | Maturity | Maturity | Excess of | Total Fair | ||||||||||||||||
Source of Fair Value | 1 Year | 1-3 Years | 4-5 Years | 5 Years | Value | |||||||||||||||
(€ in millions) | ||||||||||||||||||||
Prices actively quoted | 710.8 | 877.7 | 106.8 | 0.1 | 1,695.4 | |||||||||||||||
Prices provided by other external sources | 44.0 | 75.0 | 9.0 | (18.0 | ) | 110.0 | ||||||||||||||
Prices based on models and other valuation methods | (149.6 | ) | (180.6 | ) | (9.6 | ) | 8.7 | (331.1 | ) |
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Payments Due by Period | ||||||||||||||||||||
Less than | More than | |||||||||||||||||||
Contractual Obligations | Total | 1 Year | 1-3 Years | 3-5 Years | 5 Years | |||||||||||||||
(€ in millions) | ||||||||||||||||||||
Financial Liabilities(1) | 14,205 | 3,770 | 915 | 5,148 | 4,372 | |||||||||||||||
Capital Lease Obligations | 157 | 37 | 71 | 9 | 40 | |||||||||||||||
Operating Leases | 577 | 99 | 157 | 125 | 196 | |||||||||||||||
Purchase Obligations | 175,703 | 18,563 | 29,309 | 36,302 | 91,529 | |||||||||||||||
Asset Retirement Obligations | 9,661 | 199 | 364 | 262 | 8,836 | |||||||||||||||
Pension Payments | 9,577 | 865 | 1,804 | 1,899 | 5,009 | |||||||||||||||
Other Long-Term Obligations | 5,431 | 601 | 3,874 | 219 | 737 | |||||||||||||||
Total Contractual Obligations | 215,311 | 24,134 | 36,494 | 43,964 | 110,719 | |||||||||||||||
(1) | Excludes capital lease obligations. |
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Item 6. | Directors, Senior Management and Employees. |
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Year First | ||||||||||
Name and Position Held | Age | Principal Occupation | Elected | |||||||
Ulrich Hartmann(1)(2)*(3)* Chairman of the Supervisory Board | 67 | Retired Co-Chief Executive Officer of E.ON AG; formerly Chairman of the Board of Management and Chief Executive Officer of VEBA AG | 2003 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
Deutsche Bank AG, Deutsche Lufthansa AG, Hochtief AG, IKB Deutsche Industriebank AG (Chairman), Münchener Rückversicherungs- Gesellschaft AG, Arcelor(4), Henkel KGaA(4) | ||||||||||
Hubertus Schmoldt(2)(3)(5) Deputy Chairman of the Supervisory Board | 60 | Chairman of the Board of Management of Industriegewerkschaft Bergbau, Chemie, Energie | 1996 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
Bayer AG, BHW AG, DOW Olefinverbund GmbH, Deutsche BP AG, RAG Aktiengesellschaft | ||||||||||
Günter Adam(5) Member of the Supervisory Board | 47 | Chairman of the Central Works Council, Degussa AG | 2002 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
Degussa AG | ||||||||||
Dr. Karl-Hermann Baumann(1)* Member of the Supervisory Board | 70 | Formerly Chairman of the Supervisory Board of Siemens AG; formerly member of the Board of Management of Siemens AG | 2000 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
Linde AG, Schering AG | ||||||||||
Dr. Rolf-E. Breuer Member of the Supervisory Board | 68 | Chairman of the Supervisory Board of Deutsche Bank AG; formerly Spokesman of the Board of Management of Deutsche Bank AG | 1997 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
Landwirtschaftliche Rentenbank(4) | ||||||||||
Dr. Gerhard Cromme(3) Member of the Supervisory Board | 62 | Chairman of the Supervisory Board of ThyssenKrupp AG | 1993 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
Allianz AG, Axel Springer AG, Deutsche Lufthansa AG, Hochtief AG, Siemens AG, Volkswagen AG, Suez S.A.(4), BNP Paribas S.A.(4), Compagnie de Saint-Gobain |
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Year First | ||||||||||
Name and Position Held | Age | Principal Occupation | Elected | |||||||
Gabriele Gratz(5)(6) Member of the Supervisory Board | 57 | Chairwoman of the Works Council of E.ON Ruhrgas AG | 2005 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
E.ON Ruhrgas AG | ||||||||||
Wolf-Rüdiger Hinrichsen(2)(3)(5) Member of the Supervisory Board | 50 | Chairman of the Group Workers’ Council of E.ON AG | 1998 | |||||||
Ulrich Hocker Member of the Supervisory Board | 55 | General Manager of the German Investor Protection Association | 1998 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
Feri Finance AG, Gildemeister AG, Karstadt Quelle AG, ThyssenKrupp Stainless AG, Gartmore SICAV(4), Phoenix Mecano AG(4) (Chairman) | ||||||||||
Eva Kirchhof(5) Member of the Supervisory Board | 48 | Diploma-Physicist, Degussa AG | 2002 | |||||||
Seppel Kraus(5) Member of the Supervisory Board | 52 | Secretary of Labor Union | 2003 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
Wacker-Chemie AG, UPM-Kymmene Beteiligungs GmbH | ||||||||||
Prof. Dr. Ulrich Lehner Member of the Supervisory Board | 59 | President and Chief Executive Officer, Henkel KGaA | 2003 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
HSBC Trinkaus & Burkhardt KGaA, Ecolab Inc.(4), Novartis AG(4), The DIAL Corporation(4) (Chairman) | ||||||||||
Dr. Klaus Liesen Member of the Supervisory Board | 74 | Honorary Chairman of the Supervisory Board of E.ON Ruhrgas AG; formerly Chairman of the Supervisory Board of E.ON Ruhrgas AG | 1991 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
TUI AG, Volkswagen AG | ||||||||||
Erhard Ott(5)(6) Member of the Supervisory Board | 52 | Member of the Board of Management, Unified Services Sector Union (ver.di) | 2005 | |||||||
Ulrich Otte(1)(5) Member of the Supervisory Board | 56 | Chairman of the Central Works Council, E.ON Energie AG | 2001 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
E.ON Energie AG, E.ON Kraftwerke GmbH | ||||||||||
Klaus-Dieter Raschke(1)(5) Member of the Supervisory Board | 52 | Chairman of the Combined Works Council, E.ON Energie AG | 2002 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
E.ON Energie AG, E.ON Kernkraft GmbH | ||||||||||
Dr. Henning Schulte-Noelle(2) Member of the Supervisory Board | 63 | Chairman of the Supervisory Board of Allianz AG; formerly Chairman of the Board of Management of Allianz AG | 1993 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
Siemens AG, ThyssenKrupp AG |
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Year First | ||||||||||
Name and Position Held | Age | Principal Occupation | Elected | |||||||
Prof. Dr. Wilhelm Simson Member of the Supervisory Board | 67 | Retired Co-Chief Executive Officer of E.ON AG; formerly Chairman of the Board of Management and Chief Executive Officer of VIAG AG | 2003 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
Frankfurter Allgemeine Zeitung GmbH, Merck KGaA (Chairman since January 1, 2006), Freudenberg & Co.(4), Jungbunzlauer Holding AG(4), E. Merck OHG(4) | ||||||||||
Gerhard Skupke(5) Member of the Supervisory Board | 56 | Chairman of the Central Works Council, E.ON edis Aktiengesellschaft | 2003 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
E.ON edis Aktiengesellschaft | ||||||||||
Dr. Georg Freiherr von Waldenfels Member of the Supervisory Board | 61 | Former Minister of Finance of the State of Bavaria; Attorney | 2003 | |||||||
Supervisory Board Memberships/Directorships: | ||||||||||
Georgsmarienhütte Holding GmbH, GI Ventures AG (Chairman) |
* | Chairman of the respective Supervisory Board committee. |
(1) | Member of E.ON AG’s Audit Committee. For more information, see “Item 10. Additional Information — Memorandum and Articles of Association — Corporate Governance — The Supervisory Board Committees.” |
(2) | Member of E.ON AG’s Executive Committee, which covers the functions of a remuneration committee. For more information, see “Item 10. Additional Information — Memorandum and Articles of Association — Corporate Governance — The Supervisory Board Committees.” |
(3) | Member of E.ON AG’s Finance and Investment Committee. For more information, see “Item 10. Additional Information — Memorandum and Articles of Association — Corporate Governance — The Supervisory Board Committees.” |
(4) | Membership in comparable domestic or foreign supervisory body of a commercial enterprise. |
(5) | Elected by the employees. |
(6) | Member since July 1, 2005. Gabriele Gratz was elected to the position held prior to that date by Ralf Blauth; Erhard Ott was elected to that formerly held by Peter Obramski. |
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Year First | Year Current | |||||||||||||
Name and Title | Age | Business Activities and Experience | Appointed | Term Expires | ||||||||||
Dr. Wulf H. Bernotat Chairman of the Board of Management | 57 | Chief Executive Officer; Corporate Communications, Corporate and Public Affairs, Investor Relations, Supervisory Board Relations, Strategy, Executive Development, Audit; formerly Chairman of the Board of Management of Stinnes AG | 2003 | 2008 | ||||||||||
Supervisory Board Memberships/Directorships: | ||||||||||||||
E.ON Energie AG(1) (Chairman), E.ON Ruhrgas AG(1) (Chairman), Allianz AG, Metro AG, RAG Aktiengesellschaft (Chairman), E.ON Nordic AB(2)(3) (Chairman), E.ON UK plc(2)(3) (Chairman), E.ON US Investments Corp.(2)(3) (Chairman), E.ON Sverige AB(2)(3) (Chairman) | ||||||||||||||
Dr. Burckhard Bergmann Member of the Board of Management | 62 | Upstream Business, Market Management, Group Regulatory Management; Chairman of the Board of Management and Chief Executive Officer of E.ON Ruhrgas AG | 2003 | 2008 | ||||||||||
Supervisory Board Memberships/Directorships: | ||||||||||||||
E.ON Ruhrgas International AG(1) (Chairman), Thüga AG(1) (Chairman), Allianz Lebensversicherungs-AG, MAN Ferrostaal AG, Jaeger Akustik GmbH & Co.(2) (Chairman), Mitteleuropäische Gasleitungsgesellschaft mbH (MEGAL)(2)(3) (Chairman), OAO Gazprom(2), E.ON Ruhrgas E & P GmbH(2)(3) (Chairman), Trans Europe Naturgas Pipeline GmbH(2)(3) (Chairman), E.ON Ruhrgas Transport Management GmbH(2)(3) (Chairman), E.ON UK plc(2)(3), ZAO Gerosgaz(2)(3) (Chairman; in alternation with a representative of the foreign partner) | ||||||||||||||
Dr. Hans Michael Gaul Member of the Board of Management | 63 | Controlling/Corporate Planning, M&A, Legal Affairs; formerly Member of the Board of Management of VEBA AG | 1990 | 2007 | ||||||||||
Supervisory Board Memberships/Directorships: | ||||||||||||||
Degussa AG(1), E.ON Energie AG(1), E.ON Ruhrgas AG(1), Allianz Versicherungs-AG, DKV AG, RAG Aktiengesellschaft, STEAG AG, Volkswagen AG, E.ON Nordic AB(2)(3), E.ON Sverige AB(2)(3) | ||||||||||||||
Dr. Manfred Krüper Member of the Board of Management | 64 | Labor Relations, Personnel, Infrastructure and Services, Procurement, Organization; formerly Member of the Board of Management of VEBA AG | 1996 | 2006 |
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Year First | Year Current | |||||||||||||
Name and Title | Age | Business Activities and Experience | Appointed | Term Expires | ||||||||||
Supervisory Board Memberships/Directorships: | ||||||||||||||
�� | ||||||||||||||
E.ON Energie AG(1), Degussa AG(1), equitrust Aktiengesellschaft (Chairman), RAG Aktiengesellschaft, RAG Immobilien AG, Victoria Versicherung AG, Victoria Lebensversicherung AG, E.ON US Investments Corp.(2)(3), E.ON North America, Inc.(2)(3) (Chairman) | ||||||||||||||
Dr. Erhard Schipporeit Member of the Board of Management | 56 | Chief Financial Officer; Finance, Accounting, Taxes, IT; formerly Member of the Board of Management of VIAG AG (appointed in 1997) | 2000 | 2009 | ||||||||||
Supervisory Board Memberships/Directorships: | ||||||||||||||
E.ON Ruhrgas AG(1), Degussa AG(1), Commerzbank AG, Deutsche Börse AG, SAP AG, Talanx AG, E.ON Audit Services GmbH(2)(3) (Chairman), E.ON IS GmbH (2)(3), E.ON Risk Consulting GmbH(2)(3) (Chairman), E.ON UK plc(2)(3), E.ON US Investments Corp.(2)(3), HDI V.a.G.(2) | ||||||||||||||
Dr. Johannes Teyssen Member of the Board of Management | 46 | Downstream Business, Market Management, Group Regulatory Management; Chairman of the Board of Management and Chief Executive Officer of E.ON Energie AG | 2004 | 2008 | ||||||||||
Supervisory Board Memberships/Directorships: | ||||||||||||||
E.ON Bayern AG(1) (Chairman), E.ON Hanse AG(1) (Chairman), Salzgitter AG, E.ON Nordic AB(2)(3), E.ON Sverige AB(2)(3) |
(1) | Group mandate. |
(2) | Membership in comparable domestic or foreign supervisory body of a commercial enterprise. |
(3) | Other Group mandate (membership in comparable domestic or foreign supervisory body of a commercial enterprise). |
The Compensation System for Members of the Supervisory Board |
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Variable | Variable | ||||||||||||||||||||
Fixed | Short-Term | Long-Term | Compensation | ||||||||||||||||||
Compensation | Compensation | Compensation | for Supervisory | ||||||||||||||||||
for Service on | for Service on | for Service on | Board | ||||||||||||||||||
E.ON’s | E.ON’s | E.ON’s | Memberships | ||||||||||||||||||
Supervisory | Supervisory | Supervisory | at Affiliated | ||||||||||||||||||
Name | Board | Board | Board | Companies | Total | ||||||||||||||||
(€) | |||||||||||||||||||||
Ulrich Hartmann | 165,000 | 91,425 | 126,420 | — | 382,845 | ||||||||||||||||
Hubertus Schmoldt | 110,000 | 60,950 | 84,280 | — | 255,230 | ||||||||||||||||
Günter Adam | 55,000 | 30,475 | 42,140 | — | 127,615 | ||||||||||||||||
Dr. Karl-Hermann Baumann | 110,000 | 60,950 | 84,280 | — | 255,230 | ||||||||||||||||
Ralf Blauth (until June 30, 2005) | 41,250 | 22,856 | 31,605 | — | 95,711 | ||||||||||||||||
Dr. Rolf-E. Breuer | 55,000 | 30,475 | 42,140 | — | 127,615 | ||||||||||||||||
Dr. Gerhard Cromme | 82,500 | 45,713 | 63,210 | 51,500 | 242,923 | ||||||||||||||||
Gabriele Gratz (from July 1, 2005) | 27,500 | 15,237 | 21,070 | �� | 50,750 | 114,557 | |||||||||||||||
Wolf-Rüdiger Hinrichsen | 82,500 | 45,713 | 63,210 | — | 191,423 | ||||||||||||||||
Ulrich Hocker | 55,000 | 30,475 | 42,140 | — | 127,615 | ||||||||||||||||
Eva Kirchhof | 55,000 | 30,475 | 42,140 | — | 127,615 | ||||||||||||||||
Seppel Kraus | 55,000 | 30,475 | 42,140 | — | 127,615 | ||||||||||||||||
Prof. Dr. Ulrich Lehner | 55,000 | 30,475 | 42,140 | — | 127,615 | ||||||||||||||||
Dr. Klaus Liesen | 55,000 | 30,475 | 42,140 | — | 127,615 | ||||||||||||||||
Peter Obramski (until June 30, 2005) | 27,500 | 15,237 | 21,070 | 29,320 | 93,127 | ||||||||||||||||
Erhard Ott (from July 1, 2005) | 27,500 | 15,237 | 21,070 | — | 63,807 | ||||||||||||||||
Ulrich Otte | 66,458 | 36,824 | 50,919 | 66,850 | 221,051 | ||||||||||||||||
Klaus-Dieter Raschke | 82,500 | 45,713 | 63,210 | 44,640 | 236,063 | ||||||||||||||||
Dr. Henning Schulte-Noelle | 82,500 | 45,713 | 63,210 | — | 191,423 | ||||||||||||||||
Prof. Dr. Wilhelm Simson | 55,000 | 30,475 | 42,140 | — | 127,615 | ||||||||||||||||
Gerhard Skupke | 55,000 | 30,475 | 42,140 | 10,750 | 138,365 | ||||||||||||||||
Dr. Georg Freiherr von Waldenfels | 55,000 | 30,475 | 42,140 | — | 127,615 | ||||||||||||||||
Subtotal | 1,455,208 | 806,318 | 1,114,954 | 253,810 | 3,630,290 | ||||||||||||||||
Attendance fees and meeting-related reimbursements(1) | 128,816 | ||||||||||||||||||||
Total | 1,455,208 | 806,318 | 1,114,954 | 253,810 | 3,759,106 | ||||||||||||||||
(1) | Attendance fees and meeting-related reimbursements are given as an aggregate for all Supervisory Board members. |
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Fair Value | |||||||||||||||||||||||||
of SARs | SARs | ||||||||||||||||||||||||
Granted in | Granted in | ||||||||||||||||||||||||
Fixed Annual | Annual | Other | 7th Tranche | 7th Tranche | |||||||||||||||||||||
Name | Compensation | Bonus | Compensation(1) | in 2005 | Total | in 2005 | |||||||||||||||||||
(€) | (€) | (€) | (€) | (€) | (No. of SARs) | ||||||||||||||||||||
Dr. Wulf H. Bernotat | 1,150,000 | 3,180,000 | 41,412 | 1,350,000 | 5,721,412 | 97,472 | |||||||||||||||||||
Dr. Burckhard Bergmann | 700,000 | 1,800,000 | 28,174 | 800,000 | 3,328,174 | 57,761 | |||||||||||||||||||
Dr. Hans Michael Gaul | 700,000 | 2,100,000 | 31,113 | 800,000 | 3,631,113 | 57,761 | |||||||||||||||||||
Dr. Manfred Krüper | 700,000 | 1,850,000 | 31,313 | 800,000 | 3,381,313 | 57,761 | |||||||||||||||||||
Dr. Erhard Schipporeit | 700,000 | 1,620,000 | 41,780 | 800,000 | 3,161,780 | 57,761 | |||||||||||||||||||
Dr. Johannes Teyssen | 700,000 | 1,700,000 | 43,135 | 800,000 | 3,243,135 | 57,761 | |||||||||||||||||||
Total | 4,650,000 | 12,250,000 | 216,927 | 5,350,000 | 22,466,927 | 386,277 | |||||||||||||||||||
(1) | Other compensation amounting to approximately€0.2 million (2004:€0.5 million) includes benefits in kind, primarily related to the private use of company cars, and attendance fees for Supervisory Board memberships at affiliated companies. |
Tranche 5 in 2003 | Tranche 4 in 2002 | Tranche 3 in 2001 | Tranche 2 in 2000 | |||||||||||||||||||||||||||||
Exercised | Exercise | Exercised | Exercise | Exercised | Exercise | Exercised | Exercise | |||||||||||||||||||||||||
SARs | Gains (1) | SARs | Gains (1) | SARs | Gains (1) | SARs | Gains (1) | |||||||||||||||||||||||||
Name | No. of SARs | (€) | No. of SARs | (€) | No. of SARs | (€) | No. of SARs | (€) | ||||||||||||||||||||||||
Dr. Wulf H. Bernotat | 40,000 | 1,547,600 | — | — | — | — | — | — | ||||||||||||||||||||||||
Dr. Burckhard Bergmann | 15,000 | 384,150 | — | — | — | — | — | — | ||||||||||||||||||||||||
Dr. Hans Michael Gaul | 10,000 | 384,700 | 40,000 | 698,200 | 25,000 | 399,450 | 10,500 | 201,810 | ||||||||||||||||||||||||
Dr. Manfred Krüper | — | — | 25,000 | 658,250 | 25,000 | 355,500 | 21,000 | 403,620 | ||||||||||||||||||||||||
Dr. Erhard Schipporeit | 30,000 | 803,900 | 40,000 | 439,100 | 25,000 | 407,150 | — | — | ||||||||||||||||||||||||
Dr. Johannes Teyssen | 37,209 | 1,032,178 | — | — | 16,500 | 244,200 | — | — |
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(1) | The amount paid upon exercise of any SARs is the difference between the E.ON AG stock price at the time of exercise and the E.ON AG stock price at the time of the SAR issuance, multiplied by the number of SARs exercised. |
Employees at | Employees at | Employees at | ||||||||||||||||||||||||||||||||||
December 31, 2005 | December 31, 2004 | December 31, 2003 | ||||||||||||||||||||||||||||||||||
Total | Germany | Foreign | Total | Germany | Foreign | Total | Germany | Foreign | ||||||||||||||||||||||||||||
Central Europe | 44,476 | 30,307 | 14,169 | 36,811 | 29,208 | 7,603 | 36,576 | 28,611 | 7,965 | |||||||||||||||||||||||||||
Pan-European Gas | 13,366 | 3,411 | 9,955 | 4,001 | 3,432 | 569 | 4,357 | 3,885 | 472 | |||||||||||||||||||||||||||
U.K. | 12,891 | 10 | 12,881 | 10,397 | 6 | 10,391 | 6,541 | — | 6,541 | |||||||||||||||||||||||||||
Nordic | 5,801 | 2 | 5,799 | 5,530 | 2 | 5,528 | 6,294 | — | 6,294 | |||||||||||||||||||||||||||
U.S. Midwest | 3,002 | 2 | 3,000 | 2,997 | 1 | 2,996 | 3,080 | — | 3,080 | |||||||||||||||||||||||||||
Corporate Center | 411 | 395 | 16 | 420 | 403 | 17 | 597 | 390 | 207 | |||||||||||||||||||||||||||
Total | 79,947 | 34,127 | 45,820 | 60,156 | 33,052 | 27,104 | 57,445 | 32,886 | 24,559 | |||||||||||||||||||||||||||
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Item 7. | Major Shareholders and Related Party Transactions. |
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Item 8. | Financial Information. |
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Item 9. | The Offer and Listing. |
Price per ADS | |||||||||
($)(1) | |||||||||
High | Low | ||||||||
2001 | 60.50 | 42.03 | |||||||
2002 | 58.02 | 39.80 | |||||||
2003 | 65.44 | 38.52 | |||||||
2004 | 91.15 | 61.72 | |||||||
First Quarter | 68.95 | 61.72 | |||||||
Second Quarter | 72.54 | 63.15 | |||||||
Third Quarter | 75.17 | 69.22 | |||||||
Fourth Quarter | 91.15 | 73.90 | |||||||
2005 | 35.01 | 27.67 | |||||||
First Quarter | 31.01 | 28.21 | |||||||
Second Quarter | 29.97 | 27.67 | |||||||
Third Quarter | 33.73 | 29.14 | |||||||
Fourth Quarter | 35.01 | 29.15 | |||||||
September | 33.73 | 30.58 | |||||||
October | 31.31 | 29.15 | |||||||
November | 31.96 | 29.50 | |||||||
December | 35.01 | 31.68 | |||||||
2006 | |||||||||
January | 37.33 | 35.60 | |||||||
February | 38.13 | 36.58 |
(1) | One E.ON ADS equaled one Ordinary Share until March 28, 2005. |
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• | Quarterly reporting; | |
• | Application of international accounting standards (either IAS or U.S. GAAP); | |
• | Publication of a financial calendar listing the most important corporate events; | |
• | At least one analysts’ conference per year; and | |
• | Provision of English language versions of all current reports and ad-hoc disclosures required under the German Securities Trading Act (Wertpapierhandelsgesetz, or “Securities Trading Act”). |
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Price Per | |||||||||||||||||
Ordinary Share | DAX 30 Index(1) | ||||||||||||||||
High | Low | High | Low | ||||||||||||||
�� | |||||||||||||||||
(€) | (€ in thousands) | ||||||||||||||||
2001 | 64.50 | 64.91 | 6,795.14 | 3,787.23 | |||||||||||||
2002 | 59.97 | 38.16 | 5,462.55 | 2,597.88 | |||||||||||||
2003 | 51.74 | 34.67 | 3,965.16 | 2,202.96 | |||||||||||||
2004 | 67.06 | 49.27 | 4,261.79 | 3,646.99 | |||||||||||||
First Quarter | 56.16 | 49.27 | 4,151.83 | 3,726.07 | |||||||||||||
Second Quarter | 59.63 | 53.45 | 4,134.10 | 3,754.37 | |||||||||||||
Third Quarter | 60.83 | 56.85 | 4,035.02 | 3,646.99 | |||||||||||||
Fourth Quarter | 67.06 | 60.05 | 4,261.79 | 3,854.41 | |||||||||||||
2005 | 88.92 | 64.50 | 5,458.58 | 4,178.10 | |||||||||||||
First Quarter | 71.70 | 64.50 | 4,428.09 | 4,201.81 | |||||||||||||
Second Quarter | 73.68 | 69.60 | 4,627.48 | 4,178.10 | |||||||||||||
Third Quarter | 80.80 | 72.59 | 5,048.74 | 4,530.18 | |||||||||||||
Fourth Quarter | 88.92 | 72.25 | 5,458.58 | 4,806.05 | |||||||||||||
September | 80.80 | 75.69 | 5,048.14 | 4,837.81 | |||||||||||||
October | 78.19 | 72.25 | 5,138.02 | 4,806.05 | |||||||||||||
November | 81.29 | 74.68 | 5,199.48 | 4,922.55 | |||||||||||||
December | 88.92 | 80.44 | 5,458.58 | 5,266.55 | |||||||||||||
2006 | |||||||||||||||||
January | 91.93 | 87.07 | 5,674.15 | 5,334.30 | |||||||||||||
February | 96.10 | 91.95 | 5,915.15 | 5,649.60 |
(1) | The DAX 30 Index is a continuously updated, capital-weighted performance index of 30 German blue chip companies. E.ON represented approximately 10.23 percent of the DAX 30 Index as of March 6, 2006. In principle, the shares included in the DAX 30 Index were selected on the basis of their stock exchange turnover and their market capitalization. Adjustments of the DAX 30 Index are made for capital changes, subscription rights and dividends. |
Item 10. | Additional Information. |
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• | The annual general meeting of shareholdersratifies the actions of the corporation’s supervisory board and board of management. It decides, among other things, on the amount of the annual dividend, the appointment of an independent auditor and certain significant corporate transactions. In corporations with more than 2,000 employees, shareholders and employees elect or appoint an equal number of representatives to the supervisory board. The annual general meeting must be held within the first eight months of each fiscal year. | |
• | The supervisory boardappoints and removes the members of the board of management and oversees the management of the corporation. Although prior approval of the supervisory board may be required in connection with certain significant matters, the law prohibits the supervisory board from making management decisions. | |
• | The board of managementmanages the corporation’s business and represents it in dealings with third parties. The board of management submits regular reports to the supervisory board about the corporation’s operations and business strategies, and prepares special reports upon request. A person may not serve on the board of management and the supervisory board of a corporation at the same time. |
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• | In addition to E.ON’s general Code of Conduct for all employees, the Company has developed a special Code of Ethics for members of the Board of Management and senior financial officers and published the text on its corporate website at www.eon.com. Material appearing on the website is not incorporated by reference in this annual report. This code obliges these managers to make full, appropriate, accurate, timely and understandable disclosure of information both in the documents E.ON submits to the SEC and in its other corporate publications. | |
• | In accordance with an SEC recommendation, E.ON has established a Disclosure Committee that is responsible for ensuring that effective procedures and control mechanisms for financial reporting are in place and for providing a correct and timely presentation of information to the financial markets. The committee is comprised of seven members from various sectors of E.ON AG who have a good overview of the Group and the processing of information relating to the quarterly reports and annual financial statements. |
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• | amending the articles of association to alter the objects and purposes of the company; | |
• | increasing or reducing the share capital; | |
• | excluding preemptive rights of shareholders to subscribe for new shares; | |
• | dissolving the corporation; | |
• | merging the corporation into, or consolidating the corporation with, another company; | |
• | transferring all or virtually all of the corporation’s assets; and | |
• | changing corporate form. |
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• | election of members of the Supervisory Board (other than those elected by the employees); | |
• | amendment of the Articles of Association; | |
• | measures to increase or reduce share capital; | |
• | mergers and similar transactions; and | |
• | resolutions regarding the dissolution of the Company. |
• | register in text form in the German or English language no later than the end of the seventh day prior to the day of the shareholders’ meeting; and | |
• | prove their right to participate in the shareholders’ meeting and to exercise the voting right. This must occur by the end of the seventh day prior to the day of the shareholders’ meeting by presenting proof of the shareholding in text form in the German or English language issued by the institution where the shares are deposited. Such proof of shareholding must relate to the beginning of the twenty-first day prior to the shareholders’ meeting. |
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• | Quarterly reports; | |
• | Annual reports prepared in accordance with German law (in both German and English); | |
• | The Annual Report on Form 20-F; | |
• | A press conference at the time of release of the German annual report; and | |
• | Telephone conferences for analysts following the release of quarterly or annual results, as well as other investor relations presentations. |
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Item 11. | Quantitative and Qualitative Disclosures about Market Risk. |
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December 31, 2005 | December 31, 2004 | |||||||||||||||||||||||||||||||||
1-day | 10-day | 1-day | 10-day | |||||||||||||||||||||||||||||||
Nominal | Fair | Value- | Value- | Nominal | Fair | Value- | Value- | |||||||||||||||||||||||||||
Value | Value | at-Risk | at-Risk | Value | Value | at-Risk | at-Risk | |||||||||||||||||||||||||||
(€ in millions) | ||||||||||||||||||||||||||||||||||
FX forward transactions | ||||||||||||||||||||||||||||||||||
Buy | 4,091.3 | 79.2 | 16.9 | 53.4 | 4,238.2 | (41.3 | ) | 11.0 | 33.0 | |||||||||||||||||||||||||
Sell | 8,331.2 | (81.7 | ) | 23.6 | 74.6 | 5,328.6 | 134.2 | 11.8 | 35.4 | |||||||||||||||||||||||||
FX currency options | ||||||||||||||||||||||||||||||||||
Buy | 227.7 | 32.8 | 0.2 | 0.6 | 782.7 | 46.7 | 1.3 | 3.9 | ||||||||||||||||||||||||||
Sell | 139.6 | (39.0 | ) | 0.4 | 1.3 | 422.2 | (36.4 | ) | 0.4 | 1.2 | ||||||||||||||||||||||||
Subtotal | 12,789.8 | (8.7 | ) | 8.5 | 26.9 | 10,771.7 | 103.2 | 3.1 | 9.3 | |||||||||||||||||||||||||
(Remaining maturities) | ||||||||||||||||||||||||||||||||||
Cross currency swaps | ||||||||||||||||||||||||||||||||||
up to 1 year | 1,734.7 | 34.7 | 1.9 | 6.0 | 499.1 | (7.0 | ) | 2.3 | 6.9 | |||||||||||||||||||||||||
1 year to 5 years | 8,163.2 | 57.8 | 34.6 | 109.3 | 11,033.7 | 484.2 | 33.4 | 100.2 | ||||||||||||||||||||||||||
more than 5 years | 6,358.4 | 66.6 | 8.7 | 27.5 | 7,163.8 | 236.3 | 12.0 | 36.0 | ||||||||||||||||||||||||||
Interest rate/cross currency swaps | ||||||||||||||||||||||||||||||||||
up to 1 year | 125.0 | 13.1 | 0.5 | 1.6 | 102.3 | 1.4 | 0.5 | 1.5 | ||||||||||||||||||||||||||
1 year to 5 years | 316.4 | 5.0 | 2.3 | 7.3 | 125.0 | 12.1 | 0.5 | 1.5 | ||||||||||||||||||||||||||
more than 5 years | — | — | — | — | 297.4 | (38.5 | ) | 2.5 | 7.5 | |||||||||||||||||||||||||
Subtotal | 16,697.7 | 177.2 | 40.6 | 128.3 | 19,221.3 | 688.5 | 44.9 | 134.7 | ||||||||||||||||||||||||||
Total | 29,487.5 | 168.5 | 48.0 | 151.7 | 29,993.0 | 791.7 | 44.6 | 133.8 | ||||||||||||||||||||||||||
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Total Volume of Interest Rate Derivatives as of December 31, 2005 and December 31, 2004 |
December 31, 2005 | December 31, 2004 | ||||||||||||||||||||||||||||||||||
1-day | 10-day | 1-day | 10-day | ||||||||||||||||||||||||||||||||
Nominal | Fair | Value- | Value- | Nominal | Fair | Value- | Value- | ||||||||||||||||||||||||||||
Value | Value | at-Risk | at-Risk | Value | Value | at-Risk | at-Risk | ||||||||||||||||||||||||||||
(€ in millions) | |||||||||||||||||||||||||||||||||||
(Remaining maturities) | |||||||||||||||||||||||||||||||||||
Interest rate swaps | |||||||||||||||||||||||||||||||||||
fixed-rate payer | |||||||||||||||||||||||||||||||||||
up to 1 year | 612.2 | (11.8 | ) | 0.1 | 0.3 | 371.0 | (5.4 | ) | 0.1 | 0.3 | |||||||||||||||||||||||||
1 year to 5 years | 1,294.9 | (44.1 | ) | 1.4 | 4.4 | 2,092.5 | (107.9 | ) | 3.1 | 9.3 | |||||||||||||||||||||||||
more than 5 years | 1,033.5 | (18.0 | ) | 4.0 | 12.6 | 373.3 | (36.6 | ) | 0.8 | 2.4 | |||||||||||||||||||||||||
fixed-rate receiver | |||||||||||||||||||||||||||||||||||
up to 1 year | 0.0 | 0.0 | 0.0 | 0.0 | 23.3 | 0.3 | 0.0 | 0.0 | |||||||||||||||||||||||||||
1 year to 5 years | 5,364.4 | 64.3 | 7.7 | 24.3 | 3,914.0 | 100.6 | 10.4 | 31.2 | |||||||||||||||||||||||||||
more than 5 years | 1,196.4 | (20.7 | ) | 4.4 | 13.9 | 147.0 | 4.5 | 0.5 | 1.5 | ||||||||||||||||||||||||||
Subtotal | 9.501.4 | (30.3 | ) | 6.6 | 20.9 | 6,921.1 | (44.5 | ) | 6.7 | 20.1 | |||||||||||||||||||||||||
Interest rate options | |||||||||||||||||||||||||||||||||||
Buy up to 1 year | — | — | — | — | 554.6 | (7.2 | ) | 0.1 | 0.3 | ||||||||||||||||||||||||||
1 year to 5 years | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
more than 5 years | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Sell up to 1 year | — | — | — | — | 110.9 | (2.0 | ) | 0.0 | 0.0 | ||||||||||||||||||||||||||
1 year to 5 years | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
more than 5 years | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Subtotal | 0.0 | 0.0 | — | — | 665.5 | (9.2 | ) | 0.2 | 0.6 | ||||||||||||||||||||||||||
Total | 9,501.4 | (30.3 | ) | 6.6 | 20.9 | 7,586.6 | (53.7 | ) | 6.7 | 20.1 | |||||||||||||||||||||||||
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Item 12. | Description of Securities Other than Equity Securities. |
Item 13. | Defaults, Dividend Arrearages and Delinquencies. |
Item 14. | Material Modifications to the Rights of Security Holders and Use of Proceeds. |
Item 15. | Controls and Procedures. |
Item 16A. | Audit Committee Financial Expert. |
Item 16B. | Code of Ethics. |
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Item 16C. | Principal Accountant Fees and Services. |
Year Ended | Year Ended | |||||||
Type of Fees | December 31, 2005 | December 31, 2004 | ||||||
(€ in millions) | ||||||||
Audit Fees | 39.8 | 41.4 | ||||||
Audit-Related Fees | 9.7 | 11.4 | ||||||
Tax Fees | 1.4 | 1.7 | ||||||
All Other Fees | 1.1 | 4.8 | ||||||
Total | 52.0 | 59.3 | ||||||
Audit Committee Pre-Approval Policies |
Audit Services |
• | Annual audit for E.ON’s Consolidated Financial Statements; | |
• | Quarterly review of E.ON’s interim financial statements; | |
• | Statutory audits of financial statements of E.ON AG and of its subsidiaries under the rules of their respective countries; | |
• | Attestation of internal controls as part of the external audit; and | |
• | Attestation of regulatory filing and other compliance requirements, including regulatory advice, such as carve-out reports and comfort letters. |
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• | Accounting advice relating to transactions or events; | |
• | Due diligence relating to acquisitions, dispositions and contemplated transactions; | |
• | Consultation in accounting and corporate reporting matters; | |
• | Attestation of compliance with provisions or calculations required by agreements; | |
• | Employee benefit plan audits; | |
• | Agreed-upon procedures engagements; and | |
• | Advisory services relating to internal controls and systems documentation. |
• | Tax compliance services, including return preparation and tax payment planning; | |
• | Tax advice relating to transactions or events; | |
• | Expatriate employee tax services; | |
• | Transfer pricing studies; and | |
• | Tax services for employee benefit plans. |
• | Advisory services on corporate governance and risk management; | |
• | Advisory services on corporate treasury processes and systems; | |
• | Advisory services on information systems; and | |
• | Educational and training services on accounting and industry matters. |
Item 16D. | Exemptions from the Listing Standards for Audit Committees. |
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Item 16E. | Purchases of Equity Securities by the Issuer and Affiliated Purchasers. |
Total Number of | Maximum Number of | |||||||||||||||
Shares Purchased as | Shares that may yet | |||||||||||||||
Total Number of | Average Price Paid | Part of the Share | be Purchased under the | |||||||||||||
Shares Purchased | per Share in€ | Buyback Plan | Share Buyback Plan | |||||||||||||
2005 | (a) | (b) | (c) | (d) | ||||||||||||
Jan. 1-31 | 28,532 | 67.70 | — | 36,324,871 | ||||||||||||
Feb. 1-28 | — | — | — | 36,353,403 | ||||||||||||
Mar. 1-31 | 1,880 | 65.20 | — | 36,353,403 | ||||||||||||
Apr. 1-30 | 5,112 | 67.23 | — | 36,353,403 | ||||||||||||
May 1-31 | 450,000 | 66.59 | — | 35,903,408 | ||||||||||||
Jun. 1-30 | 132 | 71.41 | — | 35,903,408 | ||||||||||||
Jul. 1-31 | 36,255 | 72.78 | — | 36,535,476 | ||||||||||||
Aug. 1-31 | 13 | 78.30 | — | 36,535,476 | ||||||||||||
Sep. 1-30 | 150,000 | 76.97 | — | 36,203,506 | ||||||||||||
Oct. 1-31 | — | — | — | 36,203,506 | ||||||||||||
Nov. 1-30 | 158,635 | 75.14 | — | 36,353,506 | ||||||||||||
Dec. 1-31 | — | — | — | 36,353,552 | ||||||||||||
Total | 830,559 | 70.44 | — | |||||||||||||
(a) | 308,555 Ordinary Shares were purchased for the Company’s employee share purchase programs, 486,255 Ordinary Shares were purchased by E.ON Energie for the squeeze-out of Contigas minority shareholders, 35,736 Ordinary Shares were purchased in connection with claims made by certain former shareholders of Stinnes AG and 13 Ordinary Shares were purchased in connection with pre-existing conversion claims of certain former shareholders of Gelsenberg AG. All of these purchases were made in the market. In April 2005, E.ON started a squeeze-out proceeding for the remaining 1.13 percent of Contigas shares not held by E.ON at that time. Shareholders could have accepted a voluntary conversion offer of either€80 in cash for one Contigas share or€85 for each Contigas share paid in E.ON shares until June 27, 2005. 0.91 percent of shareholders accepted this offer; the remaining 0.22 percent were indemnified by means of a cash compensation agreed upon in the squeeze-out resolution. Any legal challenges were settled as of October 27, 2005. In February 2005, E.ON finalized an agreement with certain former shareholders of Stinnes AG in relation to share exchange claims(Spruchstellenverfahren) made at the time of Stinnes’ acquisition by VEBA AG. Claims with respect to the acquisition may still be made by additional former minority shareholders of Stinnes AG, and E.ON may purchase additional Ordinary Shares if and when such further claims are presented. Gelsenberg AG was merged into the former VEBA AG in 1978; its shareholders had the option to receive VEBA shares or cash against delivery of their Gelsenberg shares. In August 2005, some former Gelsenberg AG shareholders presented Gelsenberg AG shares requesting an aggregate of 13 E.ON Ordinary Shares. |
(c)(d) | Pursuant to shareholder resolutions approved at the annual general meeting of shareholders held on April 27, 2005, the Board of Management is authorized to buy back up to 10 percent of E.ON AG’s outstanding share capital, or 692,000,000 Ordinary Shares, through October 27, 2006. Pursuant to the German Stock Corporation Act, the maximum number of shares the Company may purchase at any time equals 10 percent of 692,000,000 (or 69,200,000 Ordinary Shares) less the number of Ordinary Shares held in treasury stock at such time. Therefore, the maximum number of Ordinary Shares that may be purchased under the Company’s share buyback plan, as reflected in column D, fluctuated over the course of 2005 due to changes in the number of Ordinary Shares held in treasury stock, rather than due to share repurchases. The Company did not buy back any Ordinary Shares pursuant to this share buyback plan in 2005, as the shares purchased for the employee share purchase programs, the Contigas squeeze out and the Stinnes integration were not purchased pursuant to such plan. |
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Item 17. | Financial Statements. |
Item 18. | Financial Statements. |
Item 19. | Exhibits. |
Exhibit No. | Exhibit Title | |||
1.1 | English translation of the Articles of Association(Satzung)of E.ON AG as amended to date.* | |||
4.1 | Unofficial English translation of Framework Agreement between RAG AG, RAG Beteiligungs-GmbH, RAG Projektgesellschaft mbH and EBV Aktiengesellschaft, and E.ON AG, Chemie Verwaltungs AG and E.ON Vermögensanlage GmbH, dated May 20, 2002.** | |||
4.2 | Amended and Restated Fiscal Agency Agreement between E.ON AG, E.ON International Finance B.V., E.ON UK PLC, and Citibank, N.A. as Fiscal Agent, and Banque du Luxembourg S.A. and Citibank AG as Paying Agents, relating to the Euro 20,000,000,000 Medium Term Note Programme, dated August 21, 2002.** | |||
4.3 | Sale and Purchase Agreement Regarding the Sale and Purchase of All Shares in Viterra AG between E.ON Viterra-Beteiligungsgesellschaft mbH, E.ON AG, Atrium Einhunderterste VV GmbH and Praetorium 40. VV GmbH, dated May 17, 2005.* † | |||
4.4 | Unofficial English translation of Current Form of Management Board Service Agreement.*** | |||
4.5 | Schedule 1 to Exhibit 4.4 — Individual Deviations from Form of Management Board Service Agreement.*** | |||
8.1 | Subsidiaries as of the end of the year covered by this annual report: see “Item 4. Information on the Company — Organizational Structure.” | |||
12.1 | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.* | |||
12.2 | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.* | |||
13.1 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.* |
* | Filed herewith. |
** | Incorporated by reference to the Form 20-F filed by E.ON AG with the Securities and Exchange Commission on March 19, 2003, file number 1-14688. |
*** | Incorporated by reference to the Form 20-F filed by E.ON AG with the Securities and Exchange Commission on March 10, 2005, file number 1-14688. |
† | Confidential material appearing in this document has been omitted and filed separately with the Securities and Exchange Commission in accordance with the Securities Exchange Act of 1934, as amended, and Rule 24b-2 promulgated thereunder. Omitted information has been redacted and marked with an asterisk and appropriate legend to indicate redaction. |
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Report of Independent Registered Public Accounting Firm | F-1 | ||||
Consolidated Financial Statements: | |||||
Consolidated Statements of Income for the years ended December 31, 2005, 2004 and 2003 | F-2 | ||||
Consolidated Balance Sheets at December 31, 2005 and 2004 | F-3 | ||||
Consolidated Statements of Cash Flows for the years ended December 31, 2005, 2004 and 2003 | F-4 | ||||
Consolidated Statements of Changes in Stockholders’ Equity for the years ended December 31, 2005, 2004 and 2003 | F-5 | ||||
Notes to the Consolidated Financial Statements | F-6 |
F-i
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Table of Contents
Düsseldorf | PricewaterhouseCoopers | |||
March 8, 2006 | Aktiengesellschaft | |||
Wirtschaftsprüfungsgesellschaft | ||||
/s/ Dr. Vogelpoth | /s/ Laue | |||
Dr. Vogelpoth Wirtschaftsprüfer (German Public Auditor) | Laue Wirtschaftsprüfer (German Public Auditor) |
F-1
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Year Ended December 31, | |||||||||||||||||||||
Note | 2005* | 2005 | 2004 | 2003 | |||||||||||||||||
Public utility sales | $ | 47,353 | € | 39,987 | € | 34,307 | € | 31,771 | |||||||||||||
Gas sales | 21,214 | 17,914 | 13,227 | 11,919 | |||||||||||||||||
Other sales | (1,779 | ) | (1,502 | ) | (792 | ) | 419 | ||||||||||||||
Sales | (31) | 66,788 | 56,399 | 46,742 | 44,109 | ||||||||||||||||
Electricity and petroleum tax | (5,382 | ) | (4,545 | ) | (4,358 | ) | (3,886 | ) | |||||||||||||
Sales, net of electricity and petroleum tax | 61,406 | 51,854 | 42,384 | 40,223 | |||||||||||||||||
Cost of goods sold — Public utility | (33,946 | ) | (28,666 | ) | (23,190 | ) | (22,658 | ) | |||||||||||||
Cost of goods sold — Gas | (16,091 | ) | (13,588 | ) | (9,017 | ) | (8,060 | ) | |||||||||||||
Cost of goods sold and services provided — Other | 1,737 | 1,467 | 766 | (94 | ) | ||||||||||||||||
Cost of goods sold and services provided | (48,300 | ) | (40,787 | ) | (31,441 | ) | (30,812 | ) | |||||||||||||
Gross profit on sales | 13,106 | 11,067 | 10,943 | 9,411 | |||||||||||||||||
Selling expenses | (4,562 | ) | (3,852 | ) | (4,235 | ) | (4,418 | ) | |||||||||||||
General and administrative expenses | (1,809 | ) | (1,528 | ) | (1,350 | ) | (1,248 | ) | |||||||||||||
Other operating income (expenses), net | (5) | 2,007 | 1,695 | 1,361 | 1,658 | ||||||||||||||||
Financial earnings | (6) | (206 | ) | (174 | ) | (364 | ) | (238 | ) | ||||||||||||
Income/(Loss) from continuing operations before income taxes and minority interests | 8,536 | 7,208 | 6,355 | 5,165 | |||||||||||||||||
Income taxes | (7) | (2,695 | ) | (2,276 | ) | (1,850 | ) | (1,145 | ) | ||||||||||||
Income/(Loss) from continuing operations after income taxes | 5,841 | 4,932 | 4,505 | 4,020 | |||||||||||||||||
Minority interests | (8) | (655 | ) | (553 | ) | (478 | ) | (445 | ) | ||||||||||||
Income/(Loss) from continuing operations | 5,186 | 4,379 | 4,027 | 3,575 | |||||||||||||||||
Income/(Loss) from discontinued operations, net (less applicable income taxes of€(50),€97 and€31, respectively) | (4) | 3,594 | 3,035 | 312 | 1,512 | ||||||||||||||||
Income before cumulative effect of changes in accounting principles | 8,780 | 7,414 | 4,339 | 5,087 | |||||||||||||||||
Cumulative effect of changes in accounting principles, net (less applicable income taxes of€(3),€0 and€(261), respectively) | (9 | ) | (7 | ) | — | (440 | ) | ||||||||||||||
Net income | 8,771 | 7,407 | 4,339 | 4,647 | |||||||||||||||||
Basic earnings per share: | (10) | ||||||||||||||||||||
Income/(Loss) from continuing operations | 7.87 | 6.64 | 6.13 | 5.47 | |||||||||||||||||
Income/(Loss) from discontinued operations, net | 5.45 | 4.61 | 0.48 | 2.31 | |||||||||||||||||
Cumulative effect of changes in accounting principles, net | (0.01 | ) | (0.01 | ) | — | (0.67 | ) | ||||||||||||||
Net income | 13.31 | 11.24 | 6.61 | 7.11 | |||||||||||||||||
Diluted earnings per share: | (10) | ||||||||||||||||||||
Income/(Loss) from continuing operations | 7.87 | 6.64 | 6.13 | 5.47 | |||||||||||||||||
Income/(Loss) from discontinued operations, net | 5.45 | 4.61 | 0.48 | 2.31 | |||||||||||||||||
Cumulative effect of changes in accounting principles, net | (0.01 | ) | (0.01 | ) | — | (0.67 | ) | ||||||||||||||
Net income | 13.31 | 11.24 | 6.61 | 7.11 | |||||||||||||||||
* | Note 1 |
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December 31, | ||||||||||||||||
Note | 2005* | 2005 | 2004 | |||||||||||||
ASSETS | ||||||||||||||||
Goodwill | $ | 18,193 | € | 15,363 | € | 14,454 | ||||||||||
Intangible assets | (11a) | 4,885 | 4,125 | 3,788 | ||||||||||||
Property, plant and equipment | (11b) | 48,935 | 41,323 | 43,563 | ||||||||||||
Financial assets | (11c) | 25,680 | 21,686 | 17,263 | ||||||||||||
Fixed assets | 97,693 | 82,497 | 79,068 | |||||||||||||
Inventories | (12) | 2,910 | 2,457 | 2,647 | ||||||||||||
Financial receivables and other financial assets | (13) | 2,391 | 2,019 | 2,124 | ||||||||||||
Operating receivables and other operating assets | (13) | 25,287 | 21,354 | 15,759 | ||||||||||||
Assets of disposal groups | (4) | 806 | 681 | 553 | ||||||||||||
Investment in short-term securities | (14) | 12,678 | 10,706 | 7,840 | ||||||||||||
Cash and cash equivalents | (15) | 5,226 | 4,413 | 4,176 | ||||||||||||
Non-fixed assets | 49,298 | 41,630 | 33,099 | |||||||||||||
Deferred tax assets | (7) | 2,462 | 2,079 | 1,551 | ||||||||||||
Prepaid expenses | (16) | 422 | 356 | 344 | ||||||||||||
Total assets(thereof short-term 2005:€32,648; 2004:€25,839) | 149,875 | 126,562 | 114,062 | |||||||||||||
December 31, | ||||||||||||||||
Note | 2005* | 2005 | 2004 | |||||||||||||
STOCKHOLDERS’ EQUITY AND LIABILITIES | ||||||||||||||||
Capital stock | (17) | $ | 2,130 | € | 1,799 | € | 1,799 | |||||||||
Additional paid-in capital | (18) | 13,913 | 11,749 | 11,746 | ||||||||||||
Retained earnings | (19) | 30,625 | 25,861 | 20,003 | ||||||||||||
Accumulated other comprehensive income | (20) | 6,313 | 5,331 | 268 | ||||||||||||
Treasury stock | (303 | ) | (256 | ) | (256 | ) | ||||||||||
Stockholders’ equity | 52,678 | 44,484 | 33,560 | |||||||||||||
Minority interests | (21) | 5,606 | 4,734 | 4,144 | ||||||||||||
Provisions for pensions | (22) | 10,326 | 8,720 | 8,589 | ||||||||||||
Other provisions | (23) | 29,773 | 25,142 | 25,653 | ||||||||||||
Accrued liabilities | 40,099 | 33,862 | 34,242 | |||||||||||||
Financial liabilities | (24) | 17,008 | 14,362 | 20,301 | ||||||||||||
Operating liabilities | (24) | 22,561 | 19,052 | 14,054 | ||||||||||||
Liabilities | 39,569 | 33,414 | 34,355 | |||||||||||||
Liabilities of disposal groups | (4) | 984 | 831 | 54 | ||||||||||||
Deferred tax liabilities | (7) | 9,971 | 8,420 | 6,605 | ||||||||||||
Deferred income | (16) | 968 | 817 | 1,102 | ||||||||||||
Total liabilities (thereof short-term 2005:€25,093; 2004:€23,734) | 97,197 | 82,078 | 80,502 | |||||||||||||
Total stockholders’ equity and liabilities | 149,875 | 126,562 | 114,062 | |||||||||||||
* | Note 1 |
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Year Ended December 31, | ||||||||||||||||||
2005* | 2005 | 2004 | 2003 | |||||||||||||||
Net income | $ | 8,771 | € | 7,407 | € | 4,339 | € | 4,647 | ||||||||||
Income applicable to minority interests | 655 | 553 | 478 | 445 | ||||||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||||||
Income from discontinued operations | (3,594 | ) | (3,035 | ) | (312 | ) | (1,512 | ) | ||||||||||
Depreciation, amortization, impairment | 3,633 | 3,068 | 3,051 | 3,018 | ||||||||||||||
Changes in provisions | (434 | ) | (367 | ) | (574 | ) | 1,868 | |||||||||||
Changes in deferred taxes | 468 | 395 | 58 | (362 | ) | |||||||||||||
Other non-cash income and expenses | (367 | ) | (310 | ) | 25 | (144 | ) | |||||||||||
(Gain)/ Loss on disposal: | ||||||||||||||||||
Equity investments | (52 | ) | (44 | ) | (397 | ) | (1,252 | ) | ||||||||||
Other financial assets | (4 | ) | (3 | ) | (34 | ) | 1 | |||||||||||
Intangible assets and Property, plant and equipment | (43 | ) | (36 | ) | (31 | ) | (96 | ) | ||||||||||
Changes in non-fixed assets and other operating liabilities: | ||||||||||||||||||
Inventories | (335 | ) | (283 | ) | (285 | ) | 145 | |||||||||||
Trade receivables | (1,782 | ) | (1,505 | ) | (210 | ) | 184 | |||||||||||
Other operating receivables | (4,560 | ) | (3,851 | ) | (2 | ) | 456 | |||||||||||
Trade payables | 1,641 | 1,386 | (113 | ) | (642 | ) | ||||||||||||
Other operating liabilities | 3,820 | 3,226 | (153 | ) | (1,449 | ) | ||||||||||||
Cash provided by operating activities of continuing operations | 7,817 | 6,601 | 5,840 | 5,307 | ||||||||||||||
Proceeds from disposal of: | ||||||||||||||||||
Equity investments | 7,215 | 6,093 | 1,619 | 4,397 | ||||||||||||||
Other financial assets | 361 | 305 | 719 | 991 | ||||||||||||||
Intangible assets and Property, plant and equipment | 238 | 201 | 268 | 210 | ||||||||||||||
Purchase of: | ||||||||||||||||||
Equity investments | (1,166 | ) | (985 | ) | (2,203 | ) | (6,235 | ) | ||||||||||
Other financial assets | (429 | ) | (362 | ) | (294 | ) | (240 | ) | ||||||||||
Intangible assets and Property, plant and equipment | (3,541 | ) | (2,990 | ) | (2,612 | ) | (2,538 | ) | ||||||||||
Changes in securities (other than trading) (> 3 months) | (567 | ) | (479 | ) | (385 | ) | 430 | |||||||||||
Changes in financial receivables | (1,639 | ) | (1,384 | ) | 2,506 | 2,757 | ||||||||||||
Cash provided by (used for) investing activities of continuing operations | 472 | 399 | (382 | ) | (228 | ) | ||||||||||||
Payments received (made) from changes in capital including minority interests | (31 | ) | (26 | ) | 3 | (6 | ) | |||||||||||
Payments received (made) for treasury stock, net | (39 | ) | (33 | ) | — | 7 | ||||||||||||
Payment of cash dividends to: | ||||||||||||||||||
Stockholders of E.ON AG | (1,834 | ) | (1,549 | ) | (1,312 | ) | (1,142 | ) | ||||||||||
Minority stockholders | (290 | ) | (245 | ) | (286 | ) | (477 | ) | ||||||||||
Payments for financial liabilities | 3,578 | 3,022 | 3,522 | 2,466 | ||||||||||||||
Repayments of financial liabilities | (9,040 | ) | (7,634 | ) | (6,693 | ) | (3,953 | ) | ||||||||||
Cash used for financing activities of continuing operations | (7,656 | ) | (6,465 | ) | (4,766 | ) | (3,105 | ) | ||||||||||
Net increase in cash and cash equivalents of continuing operations | 633 | 535 | 692 | 1,974 | ||||||||||||||
Cash flows from discontinued operations (Revised, see Note 27) | ||||||||||||||||||
Cash provided by operating activities of discontinued operations | 67 | 57 | 132 | 231 | ||||||||||||||
Cash provided by (used for) investing activities of discontinued operations | (317 | ) | (268 | ) | (214 | ) | 250 | |||||||||||
Cash provided by (used for) financing activities of discontinued operations | (194 | ) | (164 | ) | 305 | (440 | ) | |||||||||||
Cash provided by (used for) discontinued operations | (444 | ) | (375 | ) | 223 | 41 | ||||||||||||
Effect of foreign exchange rates on cash and cash equivalents of continuing operations | 92 | 77 | (60 | ) | (36 | ) | ||||||||||||
Cash and cash equivalents at the beginning of the period | 4,945 | 4,176 | 3,321 | 1,342 | ||||||||||||||
Cash and cash equivalents | 5,226 | 4,413 | 4,176 | 3,321 | ||||||||||||||
* | Note 1 |
F-4
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Accumulated other comprehensive income | ||||||||||||||||||||||||||||||||||||
Additional | Currency | Available | Minimum | |||||||||||||||||||||||||||||||||
Capital | paid-in | Retained | translation | for sale | pension | Cash flow | Treasury | |||||||||||||||||||||||||||||
stock | capital | earnings | adjustments | securities | liability | hedges | stock | Total | ||||||||||||||||||||||||||||
January 1, 2003 | 1,799 | 11,402 | 13,472 | (242 | ) | (3 | ) | (401 | ) | (115 | ) | (259 | ) | 25,653 | ||||||||||||||||||||||
Shares reacquired/sold | 162 | (1 | ) | 3 | 164 | |||||||||||||||||||||||||||||||
Dividends paid | (1,142 | ) | (1,142 | ) | ||||||||||||||||||||||||||||||||
Net income | 4,647 | 4,647 | ||||||||||||||||||||||||||||||||||
Other comprehensive income | (779 | ) | 1,187 | (91 | ) | 135 | 452 | |||||||||||||||||||||||||||||
Total comprehensive income | 5,099 | |||||||||||||||||||||||||||||||||||
December 31, 2003 | 1,799 | 11,564 | 16,976 | (1,021 | ) | 1,184 | (492 | ) | 20 | (256 | ) | 29,774 | ||||||||||||||||||||||||
Shares reacquired/sold | 182 | 182 | ||||||||||||||||||||||||||||||||||
Dividends paid | (1,312 | ) | (1,312 | ) | ||||||||||||||||||||||||||||||||
Net income | 4,339 | 4,339 | ||||||||||||||||||||||||||||||||||
Other comprehensive income | 125 | 994 | (598 | ) | 56 | 577 | ||||||||||||||||||||||||||||||
Total comprehensive income | 4,916 | |||||||||||||||||||||||||||||||||||
December 31, 2004 | 1,799 | 11,746 | 20,003 | (896 | ) | 2,178 | (1,090 | ) | 76 | (256 | ) | 33,560 | ||||||||||||||||||||||||
Shares reacquired/sold | 3 | 3 | ||||||||||||||||||||||||||||||||||
Dividends paid | (1,549 | ) | (1,549 | ) | ||||||||||||||||||||||||||||||||
Net income | 7,407 | 7,407 | ||||||||||||||||||||||||||||||||||
Other comprehensive income | 620 | 4,698 | (312 | ) | 57 | 5,063 | ||||||||||||||||||||||||||||||
Total comprehensive income | 12,470 | |||||||||||||||||||||||||||||||||||
December 31, 2005 | 1,799 | 11,749 | 25,861 | (276 | ) | 6,876 | (1,402 | ) | 133 | (256 | ) | 44,484 | ||||||||||||||||||||||||
F-5
Table of Contents
(1) | Basis of Presentation |
• | The Central Europe market unit, led by E.ON Energie AG (“E.ON Energie”), Munich, Germany, operates E.ON’s integrated electricity business and the downstream gas business in Central Europe. | |
• | Pan-European Gas is responsible for the upstream and midstream gas business. Moreover, this market unit holds predominantly minority interests in companies of the downstream gas business. This market unit is led by E.ON Ruhrgas AG (“E.ON Ruhrgas”), Essen, Germany. | |
• | The U.K. market unit encompasses the integrated energy business in the United Kingdom. This market unit is led by E.ON UK plc (“E.ON UK”), Coventry, U.K. | |
• | The Nordic market unit, which is led by E.ON Nordic AB (“E.ON Nordic”), Malmö, Sweden, focuses on the integrated energy business in Northern Europe. It operates through the integrated energy company E.ON Sverige AB (“E.ON Sverige”), Malmö, Sweden, (formerly: Sydkraft AB) and through E.ON Finland Oyj (“E.ON Finland”), Espoo, Finland, primarily in Sweden and Finland. For additional information about E.ON Finland, please see Note 33. | |
• | The U.S. Midwest market unit, led by E.ON U.S. LLC (“E.ON U.S.”), Louisville, Kentucky, U.S., (formerly: LG&E Energy LLC) is primarily active in the regulated energy market in the U.S. state of Kentucky. |
F-6
Table of Contents
(2) | Summary of Significant Accounting Policies |
• | Majority-owned subsidiaries in which E.ON directly or indirectly exercises control through a majority of the stockholders’ voting rights (“affiliated companies”) are fully consolidated. Furthermore, Financial Accounting Standards Board (“FASB”) Interpretation (“FIN”) No. 46 (revised December 2003), “Consolidation of Variable Interest Entities, an Interpretation of ARB No. 51” (“FIN 46R”), requires E.ON to consolidate so-called variable interest entities in which it is the primary beneficiary for economic purposes, even if it does not have a controlling interest. | |
• | Majority-owned companies in which E.ON does not exercise management control due to restrictions in the control of assets and management (“unconsolidated affiliates”) are generally accounted for under the equity method. Companies in which E.ON has the ability to exercise significant influence in the investees’ operations (“associated companies”) are also accounted for under the equity method. These are mainly companies in which E.ON holds an interest of between 20 and 50 percent. | |
• | All other share investments are accounted for under the cost method or, if they are marketable, at fair value. |
F-7
Table of Contents
€1, rate as of | €1, annual | |||||||||||||||||||||||
December 31, | average rate | |||||||||||||||||||||||
ISO code | 2005 | 2004 | 2005 | 2004 | 2003 | |||||||||||||||||||
British pound | GBP | 0.69 | 0.71 | 0.68 | 0.68 | 0.69 | ||||||||||||||||||
Norwegian krone | NOK | 7.99 | 8.24 | 8.01 | 8.37 | 8.00 | ||||||||||||||||||
Swedish krona | SEK | 9.39 | 9.02 | 9.28 | 9.12 | 9.12 | ||||||||||||||||||
U.S. dollar | USD | 1.18 | 1.36 | 1.24 | 1.24 | 1.13 |
(1) | The countries within the European Monetary Union are Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, The Netherlands, Portugal and Spain. |
F-8
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F-9
Table of Contents
• | The first step is to compare each reporting unit’s fair value with its carrying amount including goodwill. If a reporting unit’s carrying amount exceeds its fair value, this indicates that its goodwill may be impaired and the second step is required. | |
• | The second step is to compare the implied fair value of the reporting unit’s goodwill with the carrying amount of its goodwill. The implied fair value is computed by allocating the reporting unit’s fair value to all of its assets and liabilities in a manner that is similar to a purchase price allocation in a business combination in accordance with SFAS 141. The remainder after this allocation is the implied fair value of the reporting unit’s goodwill. If this fair value of goodwill is less than its carrying value, the difference is recorded as an impairment. |
F-10
Table of Contents
Buildings | 10 to 50 years | ||
Power plants | |||
Conventional components | 10 to 60 years | ||
Nuclear components | up to 25 years | ||
Hydro power plants and other facilities used to generate renewable energy | 10 to 50 years | ||
Equipment, fixtures, furniture and office equipment | 3 to 25 years | ||
Technical equipment for storage, distribution and transmission | 15 to 65 years |
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F-12
Table of Contents
F-13
Table of Contents
F-14
Table of Contents
F-15
Table of Contents
F-16
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F-17
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(3) | Scope of Consolidation |
Domestic | Foreign | Total | ||||||||||
Consolidated companies as of December 31, 2004 | 197 | 469 | 666 | |||||||||
Additions | 8 | 49 | 57 | |||||||||
Disposals/ Mergers | (77 | ) | (139 | ) | (216 | ) | ||||||
Consolidated companies as of December 31, 2005 | 128 | 379 | 507 | |||||||||
(4) | Acquisitions, Disposals, Discontinued Operations and Disposal Groups |
F-18
Table of Contents
Gorna Oryahovitza/ Varna |
ETE |
NRE |
E.ON Moldova |
F-19
Table of Contents
F-20
Table of Contents
€ in millions | 2005 | 2004 | 2003 | |||||||||
Sales | 847 | 1,188 | 1,043 | |||||||||
Gain on disposal, net | 606 | — | — | |||||||||
Other income/(expenses), net | (803 | ) | (1,123 | ) | (991 | ) | ||||||
Income from continuing operations before income taxes and minority interests | 650 | 65 | 52 | |||||||||
Income taxes | (21 | ) | (35 | ) | (16 | ) | ||||||
Minority interests | (1 | ) | (1 | ) | (1 | ) | ||||||
Income from discontinued operations | 628 | 29 | 35 | |||||||||
€ in millions | 2005 | 2004 | 2003 | |||||||||
Sales | 214 | 195 | 200 | |||||||||
Gain on disposal, net | — | — | — | |||||||||
Other income/(expenses), net | (466 | ) | (199 | ) | (199 | ) | ||||||
Income from continuing operations before income taxes and minority interests | (252 | ) | (4 | ) | 1 | |||||||
Income taxes | 90 | 2 | — | |||||||||
Income from discontinued operations | (162 | ) | (2 | ) | 1 | |||||||
December 31, | ||||
€ in millions | 2005 | |||
Fixed assets | 212 | |||
Non-fixed assets | 469 | |||
Total assets | 681 | |||
Total liabilities | 831 |
F-21
Table of Contents
Viterra |
€ in millions | 2005 | 2004 | 2003 | |||||||||
Sales | 453 | 978 | 1,075 | |||||||||
Gain on disposal, net | 2,406 | — | — | |||||||||
Other income/(expenses), net | (282 | ) | (595 | ) | (755 | ) | ||||||
Income from continuing operations before income taxes and minority interests | 2,577 | 383 | 320 | |||||||||
Income taxes | (19 | ) | (64 | ) | 37 | |||||||
Minority interests | — | (25 | ) | (18 | ) | |||||||
Income from discontinued operations | 2,558 | 294 | 339 | |||||||||
€ in millions | January 16, 2004 | |||
Goodwill | 473 | |||
Intangible assets | 10 | |||
Property, plant and equipment | 1,745 | |||
Financial assets | 34 | |||
Non-fixed assets | 197 | |||
Other assets | 20 | |||
Total assets | 2,479 | |||
Accrued liabilities | (178 | ) | ||
Liabilities | (1,911 | ) | ||
Other liabilities | (335 | ) | ||
Total liabilities | (2,424 | ) | ||
Net assets | 55 | |||
F-22
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2004 | 2003 | |||||||
€ in millions | unaudited | unaudited | ||||||
Net sales | 42,408 | 42,116 | ||||||
Income before changes in accounting principles | 4,343 | 5,156 | ||||||
Net income | 4,343 | 4,726 | ||||||
Earnings per share (in€) | 6.61 | 7.23 |
F-23
Table of Contents
€ in millions | December 31, 2004 | |||
Fixed assets | 553 | |||
Non-fixed assets | — | |||
Total assets | 553 | |||
Total liabilities | (54 | ) | ||
Net assets | 499 | |||
F-24
Table of Contents
€ in millions | February 1, 2003 | |||
Intangible assets | 651 | |||
Property, plant and equipment | 4,191 | |||
Financial assets | 4,843 | |||
Non-fixed assets | 6,042 | |||
Other assets | 200 | |||
Total assets | 15,927 | |||
Accrued liabilities | (2,098 | ) | ||
Liabilities | (4,702 | ) | ||
Other liabilities (including minority interests) | (1,854 | ) | ||
Total liabilities | (8,654 | ) | ||
Net assets (excluding goodwill) | 7,273 | |||
F-25
Table of Contents
• | Bayerngas GmbH (“Bayerngas”), Munich, Germany (held by E.ON Energie (22.0 percent) and E.ON Ruhrgas (22.0 percent)) | |
• | Gelsenwasser AG (“Gelsenwasser”), Gelsenkirchen, Germany (E.ON Energie (80.5 percent)) | |
• | swb AG (“swb”), Bremen, Germany (E.ON Energie (22.0 percent) and E.ON Ruhrgas (10.4 percent)) | |
• | Verbundnetz Gas AG (“VNG”), Leipzig, Germany (E.ON Energie (5.3 percent) and E.ON Ruhrgas (36.8 percent)) | |
• | EWE Aktiengesellschaft (“EWE”), Oldenburg, Germany (E.ON Energie (27.4 percent)) |
F-26
Table of Contents
F-27
Table of Contents
€ in millions | 2003 | |||
Sales | — | |||
Gain (loss) on disposal, net | (35 | ) | ||
Other income/(expenses), net | — | |||
Income from continuing operations before income taxes and minority interests | (35 | ) | ||
Income taxes | (2 | ) | ||
Minority interests | — | |||
Income from discontinued operations | (37 | ) | ||
€ in millions | 2003 | |||
Sales | 295 | |||
Gain on disposal, net | 418 | |||
Other income/(expenses), net | (201 | ) | ||
Income from continuing operations before income taxes and minority interests | 512 | |||
Income taxes | (24 | ) | ||
Minority interests | (9 | ) | ||
Income from discontinued operations | 479 | |||
F-28
Table of Contents
€ in millions | 2003 | |||
Sales | 202 | |||
Gain on disposal, net | 641 | |||
Other income/(expenses), net | (145 | ) | ||
Income from continuing operations before income taxes and minority interests | 698 | |||
Income taxes | (17 | ) | ||
Minority interests | — | |||
Income from discontinued operations | 681 | |||
(5) | Other Operating Income and Expenses |
€ in millions | 2005 | 2004 | 2003 | |||||||||
Gains from the disposal of business and/or fixed assets | 83 | 473 | 1,316 | |||||||||
Gain on derivative instruments, net | 946 | 585 | 384 | |||||||||
Exchange rate differences | 138 | (309 | ) | 39 | ||||||||
SAB 51 Gain | 31 | — | — | |||||||||
Research and development costs | (24 | ) | (19 | ) | (36 | ) | ||||||
Write-down of non-fixed assets | (38 | ) | (31 | ) | (209 | ) | ||||||
Miscellaneous | 559 | 662 | 164 | |||||||||
Total | 1,695 | 1,361 | 1,658 | |||||||||
F-29
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(6) | Financial Earnings |
€ in millions | 2005 | 2004 | 2003 | |||||||||
Income from companies in which share investments are held; thereof from affiliated companies:€33 (2004:€32; 2003:€25) | 203 | 185 | 160 | |||||||||
Income from profit- and loss-pooling agreements; thereof from affiliated companies:€3 (2004:€5; 2003:€9) | 3 | 5 | 18 | |||||||||
Income from companies accounted for under the equity method; thereof from affiliated companies:€3 (2004:€4; 2003:€16) | 778 | 817 | 794 | |||||||||
Losses from companies accounted for under the equity method; thereof from affiliated companies:€(96) (2004:€(54); 2003: (€3)) | (345 | ) | (168 | ) | (130 | ) | ||||||
Losses from profit- and loss-pooling agreements; thereof from affiliated companies:€(1) (2004:€(8); 2003:€(11)) | (3 | ) | (10 | ) | (18 | ) | ||||||
Write-down of investments | (29 | ) | (77 | ) | (50 | ) | ||||||
Income from share investments | 607 | 752 | 774 | |||||||||
Income from other long-term securities | 45 | 36 | 48 | |||||||||
Income from long-term loans | 31 | 43 | 52 | |||||||||
Other interest and similar income; thereof from affiliated companies:€6 (2004:€8; 2003:€0) | 971 | 536 | 644 | |||||||||
Interest and similar expenses; thereof from affiliated companies:€(8) (2004:€(5); 2003:€(12)) thereof SFAS 143 accretion expense:€(511) (2004:€(499); 2003:€(486)) | (1,783 | ) | (1,677 | ) | (1722 | ) | ||||||
Interest and similar expenses (net) | (736 | ) | (1,062 | ) | (978 | ) | ||||||
Write-down of financial assets and long-term loans | (45 | ) | (54 | ) | (34 | ) | ||||||
Financial earnings | (174 | ) | (364 | ) | (238 | ) | ||||||
F-30
Table of Contents
(7) | Income Taxes |
€ in millions | 2005 | 2004 | 2003 | ||||||||||
Current taxes | |||||||||||||
Domestic corporate income tax | 1,081 | 952 | 560 | ||||||||||
Domestic trade tax | 416 | 446 | 407 | ||||||||||
Foreign income tax | 381 | 395 | 283 | ||||||||||
Other | — | (1 | ) | 1 | |||||||||
Total | 1,878 | 1,792 | 1,251 | ||||||||||
Deferred taxes | |||||||||||||
Domestic | (4 | ) | 92 | (28 | ) | ||||||||
Foreign | 402 | (34 | ) | (78 | ) | ||||||||
Total | 398 | 58 | (106 | ) | |||||||||
Income taxes | 2,276 | 1,850 | 1,145 | ||||||||||
F-31
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F-32
Table of Contents
2005 | 2005 | 2004 | 2004 | 2003 | 2003 | ||||||||||||||||||||
€ in millions | Amount | Percent | Amount | Percent | Amount | Percent | |||||||||||||||||||
Corporate income tax | 1,802 | 25.0 | 1,588 | 25.0 | 1,369 | 26.5 | |||||||||||||||||||
Domestic trade tax net of federal tax benefit | 475 | 6.6 | 433 | 6.8 | 78 | 1.5 | |||||||||||||||||||
Foreign tax rate differentials | 165 | 2.3 | 164 | 2.6 | 70 | 1.4 | |||||||||||||||||||
Change in valuation allowances | 109 | 1.5 | (202 | ) | (3.2 | ) | 542 | 10.5 | |||||||||||||||||
Changes in tax rate/tax law | 4 | 0.1 | 142 | 2.2 | 60 | 1.2 | |||||||||||||||||||
Tax effects on | |||||||||||||||||||||||||
Tax-free income | (218 | ) | (3.0 | ) | (343 | ) | (5.4 | ) | (409 | ) | (7.9 | ) | |||||||||||||
Equity accounting | (46 | ) | (0.7 | ) | (122 | ) | (1.9 | ) | (163 | ) | (3.2 | ) | |||||||||||||
Other | (15 | ) | (0.2 | ) | 190 | 3.0 | (402 | ) | (7.8 | ) | |||||||||||||||
Effective income taxes/ tax rate | 2,276 | 31.6 | 1,850 | 29.1 | 1,145 | 22.2 | |||||||||||||||||||
€ in millions | 2005 | 2004 | 2003 | |||||||||
Viterra | 19 | 64 | (37 | ) | ||||||||
Viterra Energy Services/Viterra Contracting | — | — | 17 | |||||||||
Ruhrgas Industries | 21 | 35 | 16 | |||||||||
WKE | (90 | ) | (2 | ) | — | |||||||
Veba Oel | — | — | 2 | |||||||||
MEMC | — | — | 9 | |||||||||
Gelsenwasser | — | — | 24 | |||||||||
Income taxes from discontinued operations | (50 | ) | 97 | 31 | ||||||||
€ in millions | 2005 | 2004 | 2003 | |||||||||
Domestic | 3,526 | 3,553 | 3,033 | |||||||||
Foreign | 3,682 | 2,802 | 2,132 | |||||||||
Total | 7,208 | 6,355 | 5,165 | |||||||||
F-33
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December 31, | |||||||||
€ in millions | 2005 | 2004 | |||||||
Deferred tax assets | |||||||||
Intangible assets | 41 | 167 | |||||||
Property, plant and equipment | 624 | 376 | |||||||
Financial assets | 383 | 518 | |||||||
Inventories | 7 | 14 | |||||||
Receivables | 178 | 343 | |||||||
Accrued liabilities | 4,753 | 4,165 | |||||||
Liabilities | 2,421 | 1,250 | |||||||
Net operating loss carryforwards | 891 | 1,089 | |||||||
Tax credits | 33 | 34 | |||||||
Other | 269 | 440 | |||||||
Subtotal | 9,600 | 8,396 | |||||||
Valuation allowance | (573 | ) | (509 | ) | |||||
Total | 9,027 | 7,887 | |||||||
Deferred tax liabilities | |||||||||
Intangible assets | (1,030 | ) | (700 | ) | |||||
Property, plant and equipment | (6,609 | ) | (6,155 | ) | |||||
Financial assets | (2,312 | ) | (1,114 | ) | |||||
Inventories | (94 | ) | (98 | ) | |||||
Receivables | (2,401 | ) | (1,934 | ) | |||||
Accrued liabilities | (1,167 | ) | (1,086 | ) | |||||
Liabilities | (911 | ) | (1,149 | ) | |||||
Other | (844 | ) | (705 | ) | |||||
Total | 15,368 | 12,941 | |||||||
Net deferred tax liabilities | (6,341 | ) | (5,054 | ) | |||||
December 31, 2005 | December 31, 2004 | |||||||||||||||
Thereof | Thereof | |||||||||||||||
€ in millions | Total | non-current | Total | non-current | ||||||||||||
Deferred tax assets | 2,652 | 2,269 | 2,060 | 1,865 | ||||||||||||
Valuation allowance | (573 | ) | (563 | ) | (509 | ) | (506 | ) | ||||||||
Net deferred tax assets | 2,079 | 1,706 | 1,551 | 1,359 | ||||||||||||
Less deferred tax liabilities | (8,420 | ) | (7,929 | ) | (6,605 | ) | (5,779 | ) | ||||||||
Net deferred tax liabilities | (6,341 | ) | (6,223 | ) | (5,054 | ) | (4,420 | ) | ||||||||
F-34
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December 31, | ||||||||
€ in millions | 2005 | 2004 | ||||||
Domestic tax loss carryforwards | 2,907 | 4,487 | ||||||
Foreign tax loss carryforwards | 1,220 | 1,158 | ||||||
Total | 4,127 | 5,645 | ||||||
(8) | Minority Interests in Net Income |
€ in millions | 2005 | 2004 | 2003 | |||||||||
Wages and salaries | 3,232 | 2,933 | 3,101 | |||||||||
Social security contributions | 553 | 504 | 536 | |||||||||
Pension costs and other employee benefits; thereof pension costs:€744 (2004: €734; 2003:€647) | 794 | 755 | 748 | |||||||||
Total | 4,579 | 4,192 | 4,385 | |||||||||
F-35
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7th tranche | 6th tranche | 5th tranche | 4th tranche | 3rd tranche | 2nd tranche | |||||||||||||||||||
Date of issuance | Jan. 3, 2005 | Jan. 2, 2004 | Jan. 2, 2003 | Jan. 2, 2002 | Jan. 2, 2001 | Jan. 3, 2000 | ||||||||||||||||||
Term | 7 years | 7 years | 7 years | 7 years | 7 years | 7 years | ||||||||||||||||||
Blackout period | 2 years | 2 years | 2 years | 2 years | 2 years | 2 years | ||||||||||||||||||
Price at issuance (in €) | 65.35 | 49.05 | 42.11 | 54.95 | 62.95 | 48.35 | ||||||||||||||||||
Number of participants in year of issuance | 357 | 357 | 344 | 186 | 231 | 155 | ||||||||||||||||||
Number of SAR issued (in millions) | 2.9 | 2.7 | 2.6 | 1.7 | 1.8 | 1.5 | ||||||||||||||||||
Exercise hurdle (minimum percentage by which exercise price exceeds the price at issuance) | 10 | 10 | 10 | 10 | 20 | 20 | ||||||||||||||||||
Exercise hurdle (minimum exercise price in €) | 71.89 | 53.96 | 46.32 | 60.45 | 75.54 | 58.02 | ||||||||||||||||||
Intrinsic value as of December 31, 2005 (in€) | 22.04 | 38.34 | 45.28 | 32.44 | 24.44 | 39.04 | ||||||||||||||||||
Maximum exercise gain (in €) | 65.35 | 49.05 | — | — | — | — | ||||||||||||||||||
Number of SAR outstanding as of December 31, 2005 (in millions) | 2.9 | 2.4 | 0.6 | 0.2 | 0.1 | 0.1 | ||||||||||||||||||
Provision as of December 31, 2005 (€ in millions) | 31.8 | 92.7 | 27.8 | 7.7 | 3.9 | 0.5 | ||||||||||||||||||
Exercise gains in 2005 (€ in millions) | 0.1 | 1.2 | 49.9 | 8.5 | 15.1 | 3.3 | ||||||||||||||||||
Expense in 2005 (€ in millions) | 31.9 | 70.2 | 15.4 | 6.4 | 13.6 | 0.2 |
• | Between the date of issuance and exercise, the E.ON stock price must outperform the Dow Jones STOXX Utilities Index (Price EUR) on at least ten consecutive trading days. |
F-36
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• | The E.ON stock price on the exercise date must be at least 10.0 percent (for the second and third tranches: at least 20.0 percent) above the price at issuance. |
F-37
Table of Contents
Number of Options | 7th tranche | 6th tranche | 5th tranche | 4th tranche | 3rd tranche | 2nd tranche | ||||||||||||||||||
Outstanding as of January 1, 2002 | — | — | — | — | 1,822,620 | 1,345,800 | ||||||||||||||||||
Granted in 2002 | — | — | — | 1,646,419 | — | — | ||||||||||||||||||
Exercised in 2002 | — | — | — | — | — | 220,150 | ||||||||||||||||||
Cancelled in 2002 | — | — | — | — | — | — | ||||||||||||||||||
Change in scope of consolidation | — | — | — | — | (504,720 | ) | (301,000 | ) | ||||||||||||||||
Outstanding as of December 31, 2002 | — | — | — | 1,646,419 | 1,317,900 | 824,650 | ||||||||||||||||||
Granted in 2003 | — | — | 2,549,188 | 15,000 | — | — | ||||||||||||||||||
Exercised in 2003 | — | — | 9,902 | — | — | — | ||||||||||||||||||
Cancelled in 2003 | — | — | — | — | — | — | ||||||||||||||||||
Change in scope of consolidation | — | — | — | (46,000 | ) | (17,000 | ) | (26,800 | ) | |||||||||||||||
Outstanding as of December 31, 2003 | — | — | 2,539,286 | 1,615,419 | 1,300,900 | 797,850 | ||||||||||||||||||
Granted in 2004 | — | 2,653,847 | 12,107 | — | — | — | ||||||||||||||||||
Exercised in 2004 | — | 6,666 | 49,000 | 805,533 | — | 605,350 | ||||||||||||||||||
Cancelled in 2004 | — | — | — | — | — | — | ||||||||||||||||||
Change in scope of consolidation | — | — | — | — | — | — | ||||||||||||||||||
Outstanding as of December 31, 2004 | — | 2,647,181 | 2,502,393 | 809,886 | 1,300,900 | 192,500 | ||||||||||||||||||
Granted in 2005 | 2,904,949 | 17,297 | — | — | — | — | ||||||||||||||||||
Exercised in 2005 | 7,521 | 55,983 | 1,860,682 | 503,477 | 983,650 | 161,000 | ||||||||||||||||||
Cancelled in 2005 | 12,000 | 20,000 | — | — | 7,000 | — | ||||||||||||||||||
Change in scope of consolidation | — | (170,500 | ) | (28,000 | ) | (67,500 | ) | (151,500 | ) | (19,000 | ) | |||||||||||||
Outstanding as of December 31, 2005 | 2,885,428 | 2,417,995 | 613,711 | 238,909 | 158,750 | 12,500 | ||||||||||||||||||
Outstanding as of December 31, 2005 (in%) | 99.3 | 90.5 | 24.0 | 14.4 | 8.7 | 0.9 | ||||||||||||||||||
SAR exercisable at year end | — | — | 613,711 | 238,909 | 158,750 | 12,500 |
2005 | 2004 | |||||||
Central Europe | 42,835 | 37,509 | ||||||
Pan-European Gas | 11,025 | 3,982 | ||||||
U.K. | 12,106 | 10,453 | ||||||
Nordic | 5,766 | 5,908 | ||||||
U.S. Midwest | 3,007 | 3,039 | ||||||
Corporate Center | 434 | 418 | ||||||
Core energy business | 75,173 | 61,309 | ||||||
Other activities | — | — | ||||||
Total | 75,173 | 61,309 | ||||||
F-38
Table of Contents
€ in millions | 2005 | 2004 | 2003 | ||||||||||
Income/(Loss) from continuing operations | 4,379 | 4,027 | 3,575 | ||||||||||
Income/(Loss) from discontinued operations, net | 3,035 | 312 | 1,512 | ||||||||||
Income/(Loss) from cumulative effect of changes in accounting principles, net | (7 | ) | — | (440 | ) | ||||||||
Net income | 7,407 | 4,339 | 4,647 | ||||||||||
Weighted-average number of shares outstanding (in millions) | 659 | 657 | 654 | ||||||||||
Earnings per share (in€) | |||||||||||||
from continuing operations | 6.64 | 6.13 | 5.47 | ||||||||||
from discontinued operations, net | 4.61 | 0.48 | 2.31 | ||||||||||
from cumulative effect of changes in accounting principles, net | (0.01 | ) | — | (0.67 | ) | ||||||||
from net income | 11.24 | 6.61 | 7.11 | ||||||||||
F-39
Table of Contents
Acquisition and Production Costs | ||||||||||||||||||||||||||||||||
Exchange | Change in | |||||||||||||||||||||||||||||||
January 1, | rate | scope of | December 31, | |||||||||||||||||||||||||||||
€ in millions | 2005 | differences | consolidation | Additions | Disposals | Transfers | Impairment | 2005 | ||||||||||||||||||||||||
Goodwill | 14,758 | 613 | 356 | 43 | (82 | ) | (26 | ) | — | 15,662 | ||||||||||||||||||||||
Intangible assets | 5,428 | 32 | 494 | 114 | (79 | ) | 67 | — | 6,056 | |||||||||||||||||||||||
Advance payments on intangible assets | 7 | — | 2 | 26 | — | (9 | ) | — | 26 | |||||||||||||||||||||||
Goodwill and intangible assets | 20,193 | 645 | 852 | 183 | (161 | ) | 32 | — | 21,744 | |||||||||||||||||||||||
Real estate, leasehold rights and buildings | 18,653 | (35 | ) | (6,749 | ) | 95 | (395 | ) | 218 | (15 | ) | 11,772 | ||||||||||||||||||||
Technical equipment, plant and machinery | 73,725 | 834 | 1,623 | 1,918 | (1,240 | ) | 540 | (9 | ) | 77,391 | ||||||||||||||||||||||
Other equipment, fixtures, furniture and office equipment | 3,222 | 71 | 146 | 209 | (241 | ) | 70 | (129 | ) | 3,348 | ||||||||||||||||||||||
Advance payments and construction in progress | 1,348 | 31 | (5 | ) | 940 | (119 | ) | (854 | ) | (10 | ) | 1,331 | ||||||||||||||||||||
Property, plant and equipment | 96,948 | 901 | (4,985 | ) | 3,162 | (1,995 | ) | (26 | ) | (163 | ) | 93,842 | ||||||||||||||||||||
Shares in unconsolidated affiliates | 599 | (2 | ) | (157 | ) | 228 | (204 | ) | 226 | (14 | ) | 676 | ||||||||||||||||||||
Shares in associated companies | 10,431 | 47 | (140 | ) | 330 | (561 | ) | 149 | (8 | ) | 10,248 | |||||||||||||||||||||
Other share investments | 2,560 | (2 | ) | (195 | ) | 149 | (120 | ) | (147 | ) | (15 | ) | 2,230 | |||||||||||||||||||
Long-term loans to unconsolidated affiliates | 592 | (1 | ) | (52 | ) | 30 | (110 | ) | (208 | ) | — | 251 | ||||||||||||||||||||
Loans to associated companies and other share investments | 315 | (8 | ) | (1 | ) | 74 | (50 | ) | (17 | ) | (1 | ) | 312 | |||||||||||||||||||
Other long-term loans | 556 | (9 | ) | (2 | ) | 52 | (21 | ) | (5 | ) | (9 | ) | 562 | |||||||||||||||||||
Long-term securities | 466 | 4 | (3 | ) | 362 | (274 | ) | — | — | 555 | ||||||||||||||||||||||
Financial assets | 15,519 | 29 | (550 | ) | 1,225 | (1,340 | ) | (2 | ) | (47 | ) | 14,834 | ||||||||||||||||||||
Total | 132,660 | 1,575 | (4,683 | ) | 4,570 | (3,496 | ) | 4 | (210 | ) | 130,420 | |||||||||||||||||||||
Accumulated Depreciation | ||||||||||||||||||||||||||||||||
Exchange | Change in | Fair value | ||||||||||||||||||||||||||||||
January 1, | rate | scope of | OCI | December 31, | ||||||||||||||||||||||||||||
2005 | differences | consolidation | Additions | Disposals | Transfers | adjustments | 2005 | |||||||||||||||||||||||||
Goodwill | 304 | (3 | ) | (2 | ) | — | — | — | — | 299 | ||||||||||||||||||||||
Intangible assets | 1,647 | 10 | (30 | ) | 366 | (52 | ) | 16 | — | 1,957 | ||||||||||||||||||||||
Advance payments on intangible assets | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Goodwill and intangible assets | 1,951 | 7 | (32 | ) | 366 | (52 | ) | 16 | — | 2,256 | ||||||||||||||||||||||
Real estate, leasehold rights and buildings | 6,713 | 29 | (2,583 | ) | 231 | (302 | ) | 38 | — | 4,126 | ||||||||||||||||||||||
Technical equipment, plant and machinery | 44,433 | 318 | 387 | 2,012 | (1,067 | ) | (71 | ) | — | 46,012 | ||||||||||||||||||||||
Other equipment, fixtures, furniture and office equipment | 2,216 | 43 | 69 | 249 | (230 | ) | 26 | — | 2,373 | |||||||||||||||||||||||
Advance payments and construction in progress | 23 | — | — | — | — | (15 | ) | — | 8 | |||||||||||||||||||||||
Property, plant and equipment | 53,385 | 390 | (2,127 | ) | 2,492 | (1,599 | ) | (22 | ) | — | 52,519 | |||||||||||||||||||||
Shares in unconsolidated affiliates | 28 | — | (18 | ) | — | (1 | ) | — | — | 9 | ||||||||||||||||||||||
Shares in associated companies | 495 | 1 | (4 | ) | — | (3 | ) | — | 5 | 494 | ||||||||||||||||||||||
Other share investments | (1,924 | ) | — | (12 | ) | — | — | — | (4,839 | ) | (6,775 | ) | ||||||||||||||||||||
Long-term loans to unconsolidated affiliates | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Loans to associated companies and other share investments | 18 | — | — | — | — | — | — | 18 | ||||||||||||||||||||||||
Other long-term loans | 7 | — | — | — | — | — | — | 7 | ||||||||||||||||||||||||
Long-term securities | (368 | ) | — | — | — | — | — | (237 | ) | (605 | ) | |||||||||||||||||||||
Financial assets | (1,744 | ) | 1 | (34 | ) | — | (4 | ) | — | (5,071 | ) | (6,852 | ) | |||||||||||||||||||
Total | 53,592 | 398 | (2,193 | ) | 2,858 | (1,655 | ) | (6 | ) | (5,071 | ) | 47,923 | ||||||||||||||||||||
[Additional columns below]
[Continued from above table, first column(s) repeated]
Net book values | ||||||||
December 31, | December 31, | |||||||
2005 | 2004 | |||||||
Goodwill | 15,363 | 14,454 | ||||||
Intangible assets | 4,099 | 3,781 | ||||||
Advance payments on intangible assets | 26 | 7 | ||||||
Goodwill and intangible assets | 19,488 | 18,242 | ||||||
Real estate, leasehold rights and buildings | 7,646 | 11,940 | ||||||
Technical equipment, plant and machinery | 31,379 | 29,292 | ||||||
Other equipment, fixtures, furniture and office equipment | 975 | 1,006 | ||||||
Advance payments and construction in progress | 1,323 | 1,325 | ||||||
Property, plant and equipment | 41,323 | 43,563 | ||||||
Shares in unconsolidated affiliates | 667 | 571 | ||||||
Shares in associated companies | 9,754 | 9,936 | ||||||
Other share investments | 9,005 | 4,484 | ||||||
Long-term loans to unconsolidated affiliates | 251 | 592 | ||||||
Loans to associated companies and other share investments | 294 | 297 | ||||||
Other long-term loans | 555 | 549 | ||||||
Long-term securities | 1,160 | 834 | ||||||
Financial assets | 21,686 | 17,263 | ||||||
Total | 82,497 | 79,068 | ||||||
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Pan- | Core | |||||||||||||||||||||||||||||||||||
Central | European | U.S. | Corporate | Energy | Other | |||||||||||||||||||||||||||||||
€ in millions | Europe | Gas | U.K. | Nordic | Midwest | Center | Business | Activities | Total | |||||||||||||||||||||||||||
Book value as of January 1, 2004 | 2,178 | 3,755 | 4,348 | 297 | 3,367 | — | 13,945 | 10 | 13,955 | |||||||||||||||||||||||||||
Goodwill additions/disposals | 282 | 167 | 473 | 71 | — | 1 | 994 | — | 994 | |||||||||||||||||||||||||||
Other changes (1) | (155 | ) | (2 | ) | (42 | ) | (9 | ) | (287 | ) | — | (495 | ) | — | (495 | ) | ||||||||||||||||||||
Book value as of December 31, 2004 | 2,305 | 3,920 | 4,779 | 359 | 3,080 | 1 | 14,444 | 10 | 14,454 | |||||||||||||||||||||||||||
Goodwill additions/disposals | 115 | 481 | 21 | 7 | — | (1 | ) | 623 | — | 623 | ||||||||||||||||||||||||||
Other changes (1) | (1 | ) | (332 | ) | 155 | 2 | 472 | — | 296 | (10 | ) | 286 | ||||||||||||||||||||||||
Book value as of December 31, 2005 | 2,419 | 4,069 | 4,955 | 368 | 3,552 | — | 15,363 | — | 15,363 | |||||||||||||||||||||||||||
(1) | Other changes include transfers and exchange rate differences; the figures for 2005 also include reclassifications to discontinued operations (Pan-European Gas segment:€(326) million; other activities:€(10) million) |
December 31, 2005 | |||||||||||||
Acquisition | Accumulated | Net book | |||||||||||
€ in millions | costs | Amortization | value | ||||||||||
Intangible assets subject to amortization | |||||||||||||
Marketing-related intangible assets | 223 | 123 | 100 | ||||||||||
thereof brand names | 223 | 123 | 100 | ||||||||||
Customer-related intangible assets | 2,419 | 765 | 1,654 | ||||||||||
thereof customer lists and customer relationships | 2,305 | 704 | 1,601 | ||||||||||
Contract-based intangible assets | 1,674 | 593 | 1,081 | ||||||||||
thereof concessions | 1,223 | 392 | 831 | ||||||||||
Technology-based intangible assets | 662 | 476 | 186 | ||||||||||
thereof software | 563 | 408 | 155 | ||||||||||
Intangible assets not subject to amortization | 1,104 | — | 1,104 | ||||||||||
thereof easements | 818 | — | 818 | ||||||||||
Total | 6,082 | 1,957 | 4,125 | ||||||||||
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Table of Contents
Weighted average | |||||||||
Acquisition costs | amortization period | ||||||||
(€ in millions) | (in years) | ||||||||
Intangible assets subject to amortization | |||||||||
Marketing-related intangible assets | — | ||||||||
Customer-related intangible assets | 144 | 27 | |||||||
thereof customer lists and customer relationships | 141 | 28 | |||||||
Contract-based intangible assets | 160 | 22 | |||||||
thereof construction permits | 140 | 25 | |||||||
Technology-based intangible assets | 88 | 3 | |||||||
thereof software | 85 | 3 | |||||||
Intangible assets not subject to amortization | 253 | ||||||||
thereof licenses for exploration and production | 251 | ||||||||
Total | 645 | ||||||||
€ in millions | ||||
2006 | 354 | |||
2007 | 326 | |||
2008 | 241 | |||
2009 | 198 | |||
2010 | 165 | |||
Total | 1,284 | |||
F-42
Table of Contents
E.ON’s | |||||||||||||||||
E.ON’s | E.ON’s | accumulated | E.ON’s | ||||||||||||||
ownership | total | depreciation & | construction | ||||||||||||||
interest | acquisition cost | amortization | work in process | ||||||||||||||
Name of plants by type | in % | (€ in millions) | (€ in millions) | (€ in millions) | |||||||||||||
Nuclear | |||||||||||||||||
Isar 2 | 75.00 | 1,991 | 1,855 | 8 | |||||||||||||
Gundremmingen B | 25.00 | 96 | 81 | — | |||||||||||||
Gundremmingen C | 25.00 | 108 | 93 | — | |||||||||||||
Lignite | |||||||||||||||||
Lippendorf S | 50.00 | 532 | 373 | — | |||||||||||||
Hard Coal | |||||||||||||||||
Bexbach 1 | 8.33 | 64 | 60 | — | |||||||||||||
Trimble County (U.S.) | 75.00 | 516 | 187 | 8 | |||||||||||||
Rostock | 50.38 | 317 | 284 | — | |||||||||||||
Hydroelectric/ Wind | |||||||||||||||||
Nymølle Havspark/ Rødsand (Denmark) | 20.00 | 42 | 4 | — | |||||||||||||
Nußdorf | 53.00 | 55 | 41 | — | |||||||||||||
Ering | 50.00 | 31 | 28 | — | |||||||||||||
Egglfing | 50.00 | 47 | 43 | — |
Shares in Affiliated and Associated Companies Accounted for Under the Equity Method |
€ in millions | 2005 | thereof RAG | 2004 | thereof RAG | 2003 | thereof RAG | ||||||||||||||||||
Sales | 59,533 | 21,670 | 55,790 | 18,240 | 51,096 | 12,791 | ||||||||||||||||||
Net income | 1,782 | 91 | 2,415 | — | 2,258 | 86 | ||||||||||||||||||
E.ON’s share of net income | 550 | 36 | 881 | — | 791 | 34 | ||||||||||||||||||
Other (1) | (117 | ) | (36 | ) | (232 | ) | — | (127 | ) | (49 | ) | |||||||||||||
Income from companies accounted for under the equity method | 433 | — | 649 | — | 664 | (15 | ) | |||||||||||||||||
(1) | ‘Other’ primarily includes adjustments to conform with E.ON accounting policies, amortization of fair value adjustments due to purchase price allocations and intercompany eliminations. |
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December 31, | ||||||||||||||||
€ in millions | 2005 | thereof RAG | 2004 | thereof RAG | ||||||||||||
Fixed assets | 47,547 | 16,841 | 48,318 | 17,714 | ||||||||||||
Non-fixed assets and prepaid expenses | 32,165 | 11,679 | 30,713 | 11,973 | ||||||||||||
Accrued liabilities | 28,611 | 15,401 | 26,797 | 14,686 | ||||||||||||
Liabilities and deferred income | 30,307 | 9,833 | 29,561 | 9,785 | ||||||||||||
Minority interests | 2,152 | 1,831 | 3,085 | 2,889 | ||||||||||||
Net assets | 18,642 | 1,455 | 19,588 | 2,327 | ||||||||||||
E.ON’s share in equity | 6,788 | 570 | 7,433 | 912 | ||||||||||||
Other (1) | 2,901 | (570 | ) | 2,398 | (912 | ) | ||||||||||
Investment in companies accounted for under the equity method | 9,689 | — | 9,831 | — | ||||||||||||
(1) | ‘Other’ primarily includes adjustments to conform with E.ON accounting policies, (goodwill, fair value adjustments due to purchase price allocations), intercompany eliminations and impairments. |
December 31, 2005 | December 31, 2004 | |||||||||||||||||||||||||||||||
Gross | Gross | Gross | Gross | |||||||||||||||||||||||||||||
Amortized | Fair | unrealized | unrealized | Amortized | Fair | unrealized | unrealized | |||||||||||||||||||||||||
€ in millions | cost | value | loss | gain | cost | value | loss | gain | ||||||||||||||||||||||||
Fixed-term securities | ||||||||||||||||||||||||||||||||
Less than 1 year | 10 | 10 | — | — | 109 | 109 | — | — | ||||||||||||||||||||||||
Between 1 and 5 years | 54 | 54 | — | — | 14 | 14 | — | — | ||||||||||||||||||||||||
More than 5 years | 58 | 68 | — | 10 | 97 | 101 | — | 4 | ||||||||||||||||||||||||
Subtotal | 122 | 132 | — | 10 | 220 | 224 | — | 4 | ||||||||||||||||||||||||
Non-fixed-term securities | 2,624 | 10,033 | 1 | 7,410 | 2,755 | 5,094 | 1 | 2,340 | ||||||||||||||||||||||||
Total | 2,746 | 10,165 | 1 | 7,420 | 2,975 | 5,318 | 1 | 2,344 | ||||||||||||||||||||||||
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Long-Term Loans |
December 31, 2005 | December 31, 2004 | |||||||||||||||||||||||
Average | Average | |||||||||||||||||||||||
interest rate | Maturity | interest rate | Maturity | |||||||||||||||||||||
€ in millions | (in %) | through | € in millions | �� | (in %) | through | ||||||||||||||||||
Loans to affiliated companies | 251 | 4.24 | 2022 | 592 | 4.34 | 2025 | ||||||||||||||||||
Loans to associated companies and other share investments | 294 | 3.68 | 2024 | 297 | 3.18 | 2024 | ||||||||||||||||||
Other long-term loans | 555 | 2.08 | 2021 | 549 | 2.42 | 2023 | ||||||||||||||||||
Total | 1,100 | 1,438 | ||||||||||||||||||||||
(12) | Inventories |
December 31, | |||||||||
€ in millions | 2005 | 2004 | |||||||
Raw materials and supplies by segment | |||||||||
Central Europe | 904 | 838 | |||||||
Pan-European Gas | 28 | 104 | |||||||
U.K. | 326 | 221 | |||||||
Nordic | 223 | 213 | |||||||
U.S. Midwest | 237 | 182 | |||||||
Corporate Center | — | — | |||||||
Core energy business | 1,718 | 1,558 | |||||||
Other activities | — | 69 | |||||||
Total | 1,718 | 1,627 | |||||||
Work in progress | 58 | 320 | |||||||
Finished products | 10 | 98 | |||||||
Goods purchased for resale | 671 | 602 | |||||||
Inventories | 2,457 | 2,647 | |||||||
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Table of Contents
(13) | Receivables and Other Assets |
December 31, 2005 | December 31, 2004 | |||||||||||||||
With a | With a | With a | With a | |||||||||||||
remaining | remaining | remaining | remaining | |||||||||||||
term up to | term of more | term up to | term of more | |||||||||||||
€ in millions | 1 year | than 1 year | 1 year | than 1 year | ||||||||||||
Financial receivables from affiliated companies | 115 | — | 85 | 19 | ||||||||||||
Financial receivables from associated companies | 87 | 158 | 84 | 3 | ||||||||||||
Other financial assets | 858 | 801 | 1,145 | 788 | ||||||||||||
Financial receivables and other financial assets | 1,060 | 959 | 1,314 | 810 | ||||||||||||
Trade receivables | 8,179 | 90 | 6,462 | 72 | ||||||||||||
Operating receivables from affiliated companies | 62 | — | 63 | — | ||||||||||||
Operating receivables from associated companies and other share investments | 748 | — | 747 | 24 | ||||||||||||
Reinsurance claim due from the mutual insurance fund Versorgungskasse Energie | 80 | 1,495 | 44 | 974 | ||||||||||||
U.S. regulatory assets | 52 | 69 | 58 | 55 | ||||||||||||
Other operating assets | 8,832 | 1,747 | 6,334 | 926 | ||||||||||||
Operating receivables and other operating assets | 17,953 | 3,401 | 13,708 | 2,051 | ||||||||||||
Receivables and other assets | 19,013 | 4,360 | 15,022 | 2,861 | ||||||||||||
F-46
Table of Contents
€ in millions | 2005 | 2004 | ||||||
Balance as of January 1 | 431 | 463 | ||||||
Changes affecting income | 34 | (13 | ) | |||||
Changes not affecting income | 58 | (19 | ) | |||||
Balance as of December 31 | 523 | 431 | ||||||
(14) | Investments in Short-Term Securities |
December 31, | ||||||||
€ in millions | 2005 | 2004 | ||||||
Deposits at banking institutions with an original maturity greater than 3 months | 1,488 | 89 | ||||||
Securities with an original maturity greater than 3 months | 9,218 | 7,751 | ||||||
Investments in short-term securities | 10,706 | 7,840 | ||||||
December 31, 2005 | December 31, 2004 | |||||||||||||||||||||||||||||||
Gross | Gross | Gross | Gross | |||||||||||||||||||||||||||||
Amortized | Fair | unrealized | unrealized | Amortized | Fair | unrealized | unrealized | |||||||||||||||||||||||||
€ in millions | cost | value | loss | gain | cost | value | loss | gain | ||||||||||||||||||||||||
Fixed-term securities | ||||||||||||||||||||||||||||||||
Less than 1 year | 406 | 433 | 1 | 28 | 165 | 168 | — | 3 | ||||||||||||||||||||||||
Between 1 and 5 years | 2,408 | 2,426 | 5 | 23 | 2,372 | 2,395 | 17 | 40 | ||||||||||||||||||||||||
More than 5 years | 2,689 | 2,797 | 3 | 111 | 2,359 | 2,413 | 27 | 81 | ||||||||||||||||||||||||
Subtotal | 5,503 | 5,656 | 9 | 162 | 4,896 | 4,976 | 44 | 124 | ||||||||||||||||||||||||
Non-fixed-term securities | 2,823 | 3,604 | 23 | 804 | 2,459 | 2,807 | 40 | 388 | ||||||||||||||||||||||||
Total | 8,326 | 9,260 | 32 | 966 | 7,355 | 7,783 | 84 | 512 | ||||||||||||||||||||||||
F-47
Table of Contents
December 31, 2005 | ||||||||||||||||||||||||
less than | 12 months | |||||||||||||||||||||||
12 months | or greater | Total | ||||||||||||||||||||||
Gross | Gross | Gross | ||||||||||||||||||||||
Fair | unrealized | Fair | unrealized | Fair | unrealized | |||||||||||||||||||
€ in millions | value | loss | value | loss | value | loss | ||||||||||||||||||
Fixed-term securities | ||||||||||||||||||||||||
Less than 1 year | 309 | 1 | — | — | 309 | 1 | ||||||||||||||||||
Between 1 and 5 years | 964 | 5 | — | — | 964 | 5 | ||||||||||||||||||
More than 5 years | 357 | 3 | — | — | 357 | 3 | ||||||||||||||||||
Subtotal | 1,630 | 9 | — | — | 1,630 | 9 | ||||||||||||||||||
Non-fixed-term securities | 303 | 23 | — | — | 303 | 23 | ||||||||||||||||||
Total | 1,933 | 32 | — | — | 1,933 | 32 | ||||||||||||||||||
(15) | Cash and Cash Equivalents |
(16) | Prepaid Expenses and Deferred Income |
(17) | Capital Stock |
F-48
Table of Contents
Authorized Capital |
(18) | Additional Paid-in Capital |
F-49
Table of Contents
(19) | Retained Earnings |
December 31, | ||||||||||||
€ in millions | 2005 | 2004 | 2003 | |||||||||
Legal reserves | 45 | 45 | 45 | |||||||||
Other retained earnings | 25,816 | 19,958 | 16,931 | |||||||||
Total | 25,861 | 20,003 | 16,976 | |||||||||
(20) | Other Comprehensive Income |
December 31, 2005 | December 31, 2004 | December 31, 2003 | ||||||||||||||||||||||||||||||||||
Tax | Tax | Tax | ||||||||||||||||||||||||||||||||||
benefit/ | benefit/ | benefit/ | ||||||||||||||||||||||||||||||||||
€ in millions | Before tax | (expense) | Net-of-tax | Before tax | (expense) | Net-of-tax | Before tax | (expense) | Net-of-tax | |||||||||||||||||||||||||||
Foreign currency translation adjustments | 536 | 78 | 614 | 139 | (25 | ) | 114 | (701 | ) | (152 | ) | (853 | ) | |||||||||||||||||||||||
Plus (Less) reclassification adjustments affecting income | 6 | — | 6 | 11 | — | 11 | 71 | 3 | 74 | |||||||||||||||||||||||||||
Unrealized holding gains (losses) arising during period | 5,709 | (851 | ) | 4,858 | 1,349 | (243 | ) | 1,106 | 1,282 | (35 | ) | 1,247 | ||||||||||||||||||||||||
Plus (Less) reclassification adjustments affecting income | (169 | ) | 9 | (160 | ) | (107 | ) | (5 | ) | (112 | ) | (74 | ) | 14 | (60 | ) | ||||||||||||||||||||
Additional minimum pension liability | (580 | ) | 268 | (312 | ) | (935 | ) | 337 | (598 | ) | (156 | ) | 65 | (91 | ) | |||||||||||||||||||||
Cash Flow Hedges | 65 | (8 | ) | 57 | 89 | (33 | ) | 56 | 224 | (89 | ) | 135 | ||||||||||||||||||||||||
Total | 5,567 | (504 | ) | 5,063 | 546 | 31 | 577 | 646 | (194 | ) | 452 | |||||||||||||||||||||||||
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Table of Contents
(21) | Minority Interests |
December 31, | ||||||||
€ in millions | 2005 | 2004 | ||||||
Central Europe | 2,618 | 2,096 | ||||||
Pan-European Gas | 255 | 126 | ||||||
U.K. | 81 | 92 | ||||||
Nordic | 1,659 | 1,668 | ||||||
U.S. Midwest | 85 | 103 | ||||||
Corporate Center | 36 | 36 | ||||||
Core energy business | 4,734 | 4,121 | ||||||
Other activities | — | 23 | ||||||
Total | 4,734 | 4,144 | ||||||
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€ in millions | 2005 | 2004 | ||||||
Projected benefit obligation as of January 1 | 15,918 | 13,295 | ||||||
Service cost | 232 | 215 | ||||||
Interest cost | 777 | 804 | ||||||
Change in scope of consolidation | (375 | ) | 1,397 | |||||
Prior service cost | 32 | 6 | ||||||
Actuarial losses | 1,618 | 1,182 | ||||||
Exchange rate differences | 352 | (144 | ) | |||||
Other | — | 6 | ||||||
Pensions paid | (842 | ) | (843 | ) | ||||
Projected benefit obligation as of December 31 | 17,712 | 15,918 | ||||||
€ in millions | 2005 | 2004 | ||||||
Fair value of plan assets as of January 1 | 6,399 | 4,922 | ||||||
Actual return on plan assets | 1,198 | 601 | ||||||
Company contributions | 733 | 182 | ||||||
Employee contributions | 17 | 16 | ||||||
Change in scope of consolidation | (58 | ) | 1,220 | |||||
Exchange rate differences | 262 | (97 | ) | |||||
Pensions paid | (451 | ) | (439 | ) | ||||
Other | (3 | ) | (6 | ) | ||||
Fair value of plan assets as of December 31 | 8,097 | 6,399 | ||||||
F-52
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December 31, | ||||||||||||
Target | ||||||||||||
in % | Allocation | 2005 | 2004 | |||||||||
Equity securities | 22 | 45 | 51 | |||||||||
Debt securities | 69 | 48 | 42 | |||||||||
Real estate | 9 | 5 | 5 | |||||||||
Other | — | 2 | 2 |
December 31, | ||||||||
€ in millions | 2005 | 2004 | ||||||
Funded status | 9,615 | 9,519 | ||||||
Unrecognized actuarial loss | (3,192 | ) | (2,453 | ) | ||||
Unrecognized prior service cost | (27 | ) | (27 | ) | ||||
Net amount recognized | 6,396 | 7,039 | ||||||
December 31, | ||||||||
€ in millions | 2005 | 2004 | ||||||
Provisions for pensions | 8,720 | 8,589 | ||||||
Additional minimum liability | ||||||||
Intangible assets | (29 | ) | (38 | ) | ||||
Accumulated other comprehensive income | (1,986 | ) | (1,512 | ) | ||||
Other operating assets | (309 | ) | — | |||||
Net amount recognized | 6,396 | 7,039 | ||||||
F-53
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€ in millions | 2005 | 2004 | 2003 | |||||||||
Employer service cost | 215 | 190 | 152 | |||||||||
Interest cost | 777 | 783 | 701 | |||||||||
Expected return on plan assets | (448 | ) | (422 | ) | (327 | ) | ||||||
Prior service cost | 33 | 25 | 21 | |||||||||
Net amortization of losses | 85 | 40 | 23 | |||||||||
Total | 662 | 616 | 570 | |||||||||
€ in millions | ||||
2006 | 865 | |||
2007 | 889 | |||
2008 | 915 | |||
2009 | 939 | |||
2010 | 960 | |||
2011-2015 | 5,009 | |||
Total | 9,577 | |||
December 31, 2005 | December 31, 2004 | |||||||||||||||||||||||
United | United | United | United | |||||||||||||||||||||
in % | Germany | Kingdom | States | Germany | Kingdom | States | ||||||||||||||||||
Discount rate | 4.00 | 4.80 | 5.50 | 4.75 | 5.30 | 5.75 | ||||||||||||||||||
Salary increase rate | 2.75 | 4.00 | 5.25 | 2.75 | 4.00 | 4.50 | ||||||||||||||||||
Expected return on plan assets | 4.00 | 5.50 | 8.25 | 4.75 | 6.70 | 8.25 | ||||||||||||||||||
Pension increase rate | 1.50 | 2.80 | — | 1.25 | 2.80 | — |
F-54
Table of Contents
• | retirement costs shown in sub-items 1ab) and 1ba) for decommissioning of nuclear power plants in Germany in the amount of€8,400 million (2004:€8,204 million) and in Sweden in the amount of€403 million (2004:€404 million), | |
• | environmental improvement measures reported under sub-item 8) related to the locations of non-nuclear power plants, including removal of electricity transmission and distribution equipment in the amount of€388 million (2004:€327 million) and | |
• | environmental improvements at gas storage facilities in the amount of€90 million (2004:€77 million) and at opencast mining facilities in the amount of€61 million (2004:€59 million) as well as the decommissioning of oil and gas field infrastructure in the amount of€319 million (2004:€277 million). These obligations are also reported under sub-item 8). |
€ in millions | 2005 | 2004 | ||||||
Balance as of January 1 | 9,348 | 9,269 | ||||||
Liabilities incurred in the current period | 37 | 11 | ||||||
Liabilities settled in the current period | (181 | ) | (164 | ) | ||||
Change in scope of consolidation | 33 | 2 | ||||||
Accretion expense | 511 | 499 | ||||||
Revision in estimated cash flows | (126 | ) | (272 | ) | ||||
Other changes | 39 | 3 | ||||||
Balance as of December 31 | 9,661 | 9,348 | ||||||
December 31, | |||||||||
€ in millions | 2005 | 2004 | |||||||
Provisions for nuclear waste management (1) | 13,362 | 13,481 | |||||||
Disposal of nuclear fuel rods | 5,003 | 5,370 | |||||||
Asset retirement obligation (SFAS 143) | 8,803 | 8,608 | |||||||
Waste disposal | 425 | 378 | |||||||
less advance payments | 869 | 875 | |||||||
Provisions for taxes (2) | 3,000 | 2,871 | |||||||
Provisions for personnel costs (3) | 1,540 | 1,611 | |||||||
Provisions for supplier-related contracts (4) | 2,150 | 2,818 | |||||||
Provisions for customer-related contracts (5) | 306 | 439 | |||||||
U.S. regulatory liabilities (6) | 507 | 415 | |||||||
Provisions for environmental remediation (7) | 309 | 337 | |||||||
Provisions for environmental improvements, including land reclamation (8) | 1,725 | 1,657 | |||||||
Miscellaneous (9) | 2,243 | 2,024 | |||||||
Total | 25,142 | 25,653 | |||||||
F-55
Table of Contents
• | the costs of fuel reprocessing and | |
• | the costs of outbound transportation and the intermediate storage of nuclear waste. |
• | contractual costs for procuring intermediate containers and intermediateon-site storage on the plant premises and | |
• | costs of transporting spent fuel rods to conditioning facilities, conditioning costs and costs for procuring permanent storage containers as determined by external studies. |
F-56
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F-57
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F-58
Table of Contents
(24) | Liabilities |
December 31, 2005 | December 31, 2004 | ||||||||||||||||||||||||||||||||||||||||
With a remaining term | With a remaining term | ||||||||||||||||||||||||||||||||||||||||
of | of | ||||||||||||||||||||||||||||||||||||||||
Average | Average | ||||||||||||||||||||||||||||||||||||||||
interest rate | interest rate | ||||||||||||||||||||||||||||||||||||||||
up to | 1 to 5 | over | up to 1 year | up to | 1 to 5 | over | up to 1 year | ||||||||||||||||||||||||||||||||||
€ in millions | Total | 1 Year | Years | 5 Years | (in %) | Total | 1 Year | Years | 5 Years | (in %) | |||||||||||||||||||||||||||||||
Bonds (including Medium Term Note programs) | 9,538 | 732 | 5,195 | 3,611 | 5.7 | 9,148 | 355 | 5,306 | 3,487 | 2.4 | |||||||||||||||||||||||||||||||
Commercial paper | — | — | — | — | — | 3,631 | 3,631 | — | — | 2.1 | |||||||||||||||||||||||||||||||
Bank loans/ Liabilities to banks | 1,530 | 424 | 729 | 377 | 5.0 | 4,130 | 1,010 | 1,506 | 1,614 | 3.7 | |||||||||||||||||||||||||||||||
Bills payable | 42 | — | 42 | — | — | 51 | 3 | 48 | — | 2.6 | |||||||||||||||||||||||||||||||
Other financial liabilities | 1,306 | 742 | 165 | 399 | 2.7 | 1,648 | 155 | 547 | 946 | 4.4 | |||||||||||||||||||||||||||||||
Financial liabilities to banks and third parties | 12,416 | 1,898 | 6,131 | 4,387 | 18,608 | 5,154 | 7,407 | 6,047 | |||||||||||||||||||||||||||||||||
Financial liabilities to affiliated companies | 134 | 128 | — | 6 | 3.1 | 134 | 128 | — | 6 | 2.5 | |||||||||||||||||||||||||||||||
Financial liabilities to associated companies and other share investments | 1,812 | 1,781 | 12 | 19 | 4.4 | 1,834 | 1,754 | 20 | 60 | 3.5 | |||||||||||||||||||||||||||||||
Financial liabilities to group companies | 1,946 | 1,909 | 12 | 25 | 1,968 | 1,882 | 20 | 66 | |||||||||||||||||||||||||||||||||
Financial liabilities | 14,362 | 3,807 | 6,143 | 4,412 | 20,576 | 7,036 | 7,427 | 6,113 | |||||||||||||||||||||||||||||||||
Accounts payable | 5,288 | 5,272 | 16 | — | 3,662 | 3,627 | 35 | — | |||||||||||||||||||||||||||||||||
Operating labilities to affiliated companies | 105 | 59 | 3 | 43 | 147 | 103 | — | 44 | |||||||||||||||||||||||||||||||||
Operating liabilities to associated companies and other share investments | 188 | 98 | 70 | 20 | 184 | 92 | 71 | 21 | |||||||||||||||||||||||||||||||||
Capital expenditure grants | 270 | 19 | 96 | 155 | 271 | 26 | 93 | 152 | |||||||||||||||||||||||||||||||||
Construction grants from energy consumers | 3,674 | 420 | 736 | 2,518 | 3,558 | 347 | 692 | 2,519 | |||||||||||||||||||||||||||||||||
Advance payments | 488 | 488 | — | — | 725 | 722 | 3 | — | |||||||||||||||||||||||||||||||||
Other operating liabilities | 9,039 | 6,946 | 668 | 1,425 | 5,507 | 3,793 | 323 | 1,391 | |||||||||||||||||||||||||||||||||
thereof taxes | 614 | 614 | 989 | 989 | |||||||||||||||||||||||||||||||||||||
thereof social security contributions | 63 | 63 | 62 | 62 | |||||||||||||||||||||||||||||||||||||
Operating liabilities | 19,052 | 13,302 | 1,589 | 4,161 | 14,054 | 8,710 | 1,217 | 4,127 | |||||||||||||||||||||||||||||||||
Liabilities | 33,414 | 17,109 | 7,732 | 8,573 | 34,630 | 15,746 | 8,644 | 10,240 | |||||||||||||||||||||||||||||||||
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• | the repayment of the affected financing arrangement | |
• | the declaration that a liability becomes due and payable before its stated maturity | |
• | the triggering of cross defaults in other financing arrangements | |
• | E.ON’s access to additional financing on favorable terms being severely curtailed or even eliminated |
• | €4.25 billion issued by E.ON International Finance with a coupon of 5.75 percent and a maturity in May 2009 | |
• | €0.9 billion issued by E.ON International Finance with a coupon of 6.375 percent and a maturity in May 2017 | |
• | GBP 500 million or€725 million issued by E.ON International Finance with a coupon of 6.375 percent and a maturity in May 2012 | |
• | GBP 0.975 billion or€1.37 billion issued by E.ON International Finance with a coupon of 6.375 percent and a maturity in June 2032 |
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• | GBP 250 million or€362 million bond issued by E.ON UK plc with a coupon of 8.5 percent maturing in July 2006, of which GBP 44 million or€62 million was held by external investors | |
• | GBP 250 million or€362 million bond issued by E.ON UK plc with a coupon of 6.25 percent maturing in April 2024, of which GBP 8 million or€11 million was held by external investors |
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• | GBP 150 million or€217 million issued by Central Networks plc (previously Midlands Electricity plc, a wholly-owned subsidiary of E.ON UK plc) with a coupon of 7.375 percent maturing in November 2007 (part of the Midlands Debt), of which GBP 0.4 million or approximately€0.6 million was held by external investors | |
• | €500 million Eurobond issued by E.ON UK plc with a coupon of 5.0 percent maturing in July 2009, of which€264 million was held by external investors | |
• | USD 410 million or€347 million Yankee Bond issued by Powergen (East Midlands) Investments, London, U.K., with a coupon of 7.45 percent maturing in May 2007, of which USD 173 million or€147 million was held by external investors |
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Repayment | Repayment | Repayment | Repayment | Repayment | Repayment | |||||||||||||||||||||||
€ in millions | 2006 | 2007 | 2008 | 2009 | 2010 | after 2010 | Total | |||||||||||||||||||||
Bonds (including MTN programs) | 732 | 219 | 283 | 275 | 4,418 | 3,611 | 9,538 | |||||||||||||||||||||
Commercial paper | — | — | — | — | — | — | — | |||||||||||||||||||||
Bank loans/ Liabilities to banks | 424 | 183 | 116 | 74 | 356 | 377 | 1,530 | |||||||||||||||||||||
Bills payable | — | 40 | 2 | — | — | — | 42 | |||||||||||||||||||||
Other financial liabilities | 742 | 39 | 99 | 24 | 3 | 399 | 1,306 | |||||||||||||||||||||
Financial liabilities to banks and third parties | 1,898 | 481 | 500 | 373 | 4,777 | 4,387 | 12,416 | |||||||||||||||||||||
Used credit lines | 93 | 14 | 14 | — | 8 | 52 | 181 | |||||||||||||||||||||
Unused credit lines | 5,597 | — | — | — | 5,000 | 122 | 10,719 | |||||||||||||||||||||
Used and unused credit lines | 5,690 | 14 | 14 | — | 5,008 | 174 | 10,900 | |||||||||||||||||||||
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December 31, 2005 | ||||||||||||||||||||
€ in millions | 0 - 3% | 3.1 - 7% | 7.1 - 10% | more than 10% | Total | |||||||||||||||
Bonds (including MTN programs) | 571 | 8,624 | 343 | — | 9,538 | |||||||||||||||
Commercial paper | — | — | — | — | — | |||||||||||||||
Bank loans/ Liabilities to banks | 765 | 762 | 3 | — | 1,530 | |||||||||||||||
Bills payable | — | 42 | — | — | 42 | |||||||||||||||
Other financial liabilities | 161 | 1,124 | 4 | 17 | 1,306 | |||||||||||||||
Financial liabilities to banks and third parties | 1,497 | 10,552 | 350 | 17 | 12,416 | |||||||||||||||
December 31, | ||||||||
€ in millions | 2005 | 2004 | ||||||
Bank loans collateralized by mortgages on real estate | 141 | 1,147 | ||||||
Other collateralized bank loans | 51 | 805 | ||||||
Uncollateralized bank loans, drawings on credit lines, short-term loans | 1,338 | 2,178 | ||||||
Total | 1,530 | 4,130 | ||||||
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€ in millions | Total | Less than 1 Year | 1 - 3 Years | 3 - 5 Years | After 5 Years | |||||||||||||||
Natural gas | 164,634 | 15,292 | 26,565 | 34,835 | 87,942 | |||||||||||||||
Oil | — | — | — | — | — | |||||||||||||||
Coal | 2,889 | 1,135 | 1,099 | 485 | 170 | |||||||||||||||
Lignite and other fossil fuels | 1,089 | 33 | 66 | 66 | 924 | |||||||||||||||
Total fossil fuel purchase obligations | 168,612 | 16,460 | 27,730 | 35,386 | 89,036 | |||||||||||||||
Electricity purchase obligations | 4,228 | 1,231 | 915 | 515 | 1,567 | |||||||||||||||
Other purchase obligations | 1,024 | 208 | 238 | 135 | 443 | |||||||||||||||
Total long-term purchase commitments/obligations | 173,864 | 17,899 | 28,883 | 36,036 | 91,046 | |||||||||||||||
Major repairs | 19 | 14 | 5 | — | — | |||||||||||||||
Environmental protection measures | 29 | 3 | 5 | 3 | 18 | |||||||||||||||
Other (including capital expenditure commitments) | 1,791 | 647 | 416 | 263 | 465 | |||||||||||||||
Total other purchase commitments/obligations | 1,839 | 664 | 426 | 266 | 483 | |||||||||||||||
Other financial obligations | 4,299 | 237 | 3,681 | 205 | 176 | |||||||||||||||
Loan commitments | 1,132 | 364 | 193 | 14 | 561 | |||||||||||||||
Total | 181,134 | 19,164 | 33,183 | 36,521 | 92,266 | |||||||||||||||
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€ in millions | ||||
2006 | 136 | |||
2007 | 121 | |||
2008 | 107 | |||
2009 | 65 | |||
2010 | 69 | |||
Thereafter | 236 | |||
Total | 734 | |||
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(27) | Supplemental Disclosure of Cash Flow Information |
€ in millions | 2005 | 2004 | 2003 | ||||||||||
Cash paid during the year for | |||||||||||||
Interest, net of amounts capitalized | 966 | 1,101 | 1,082 | ||||||||||
Income taxes, net of refunds | 1,059 | 1,360 | 1,022 | ||||||||||
Non-cash investing and financing activities | |||||||||||||
Increase of stakes in subsidiaries in exchange for distribution of E.ON AG shares to minority shareholders | 35 | 182 | 153 | ||||||||||
Loan notes issued in lieu of cash purchase price payments for Caledonia | 595 | — | — | ||||||||||
Exchange and contribution of assets as part of acquisitions | 171 | — | — |
(28) | Derivative Financial Instruments and Hedging Transactions |
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• | Currency, electricity, gas, oil and coal forward contracts, swap and emissions-related derivatives are valued separately at their forward rates and prices as of the balance-sheet date. Forward rates and prices are based on spot rates and prices, with forward premiums and discounts taken into consideration. | |
• | Market prices for currency, electricity and gas options are valued using standard option pricing models commonly used in the market. The fair values of caps, floors and collars are determined on the basis of quoted market prices or on calculations based on option pricing models. | |
• | The fair values of existing instruments to hedge interest rate risk are determined by discounting future cash flows using market interest rates over the remaining term of the instrument. Discounted cash values are determined for interest rate, cross-currency and cross-currency interest-rate swaps for each individual transaction as of the balance-sheet date. Interest exchange amounts are considered with an effect on current results at the date of payment or accrual. | |
• | Equity swaps are valued on the basis of the stock prices of the underlying equities, taking into consideration any financing components. | |
• | Exchange-traded energy futures and option contracts are valued individually at daily settlement prices determined on the futures markets that are published by their respective clearing houses. Paid initial margins are disclosed under “Financial receivables and other financial assets.” Variation margins received or paid during the term of such contracts are stated under other liabilities or other assets, respectively. | |
• | Certain long-term energy contracts are valued by the use of valuation models that include average probabilities and take into account individual contract details and variables. |
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December 31, 2005 | December 31, 2004 | |||||||||||||||||
Total Volume of Foreign Currency, Interest-Rate and | ||||||||||||||||||
Equity-Based Derivatives | Nominal | Fair | Nominal | Fair | ||||||||||||||
€ in millions | value | value | value | value | ||||||||||||||
FX forward transactions | ||||||||||||||||||
Buy | 4,091.3 | 79.2 | 4,238.2 | (41.3 | ) | |||||||||||||
Sell | 8,331.2 | (81.7 | ) | 5,328.6 | 134.2 | |||||||||||||
FX currency options | ||||||||||||||||||
Buy | 227.7 | 32.8 | 782.7 | 46.7 | ||||||||||||||
Sell | 139.6 | (39.0 | ) | 422.2 | (36.4 | ) | ||||||||||||
Subtotal | 12,789.8 | (8.7 | ) | 10,771.7 | 103.2 | |||||||||||||
Cross-currency swaps | ||||||||||||||||||
up to 1 year | 1,734.7 | 34.7 | 499.1 | (7.0 | ) | |||||||||||||
1 year to 5 years | 8,163.2 | 57.8 | 11,033.7 | 484.2 | ||||||||||||||
more than 5 years | 6,358.4 | 66.6 | 7,163.8 | 236.3 | ||||||||||||||
Cross-currency interest-rate swaps | ||||||||||||||||||
up to 1 year | 125.0 | 13.1 | 102.3 | 1.4 | ||||||||||||||
1 year to 5 years | 316.4 | 5.0 | 125.0 | 12.1 | ||||||||||||||
more than 5 years | — | — | 297.4 | (38.5 | ) | |||||||||||||
Subtotal | 16,697.7 | 177.2 | 19,221.3 | 688.5 | ||||||||||||||
Interest-rate swaps | ||||||||||||||||||
Fixed-rate payer | ||||||||||||||||||
up to 1 year | 612.2 | (11.8 | ) | 371.0 | (5.4 | ) | ||||||||||||
1 year to 5 years | 1,294.9 | (44.1 | ) | 2,092.5 | (107.9 | ) | ||||||||||||
more than 5 years | 1,033.5 | (18.0 | ) | 373.3 | (36.6 | ) | ||||||||||||
Fixed-rate receiver | ||||||||||||||||||
up to 1 year | — | — | 23.3 | 0.3 | ||||||||||||||
1 year to 5 years | 5,364.4 | 64.3 | 3,914.0 | 100.6 | ||||||||||||||
more than 5 years | 1,196.4 | (20.7 | ) | 147.0 | 4.5 | |||||||||||||
Subtotal | 9,501.4 | (30.3 | ) | 6,921.1 | (44.5 | ) | ||||||||||||
Interest-rate options | ||||||||||||||||||
Buy | ||||||||||||||||||
up to 1 year | — | — | 554.6 | (7.2 | ) | |||||||||||||
1 year to 5 years | — | — | — | — | ||||||||||||||
more than 5 years | — | — | — | — | ||||||||||||||
Sell | ||||||||||||||||||
up to 1 year | — | — | 110.9 | (2.0 | ) | |||||||||||||
1 year to 5 years | — | — | — | — | ||||||||||||||
more than 5 years | — | — | — | — | ||||||||||||||
Subtotal | 0.0 | 0.0 | 665.5 | (9.2 | ) | |||||||||||||
Equity swaps | — | — | 63.8 | 103.0 | ||||||||||||||
Subtotal | 0.0 | 0.0 | 63.8 | 103.0 | ||||||||||||||
Total | 38,988.9 | 138.2 | 37,643.4 | 841.0 | ||||||||||||||
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Thereof Trading | |||||||||||||||||||||||||
Total Volume of Electricity, Gas, Coal, Oil and | December 31, 2005 | December 31, 2005 | December 31, 2004 | ||||||||||||||||||||||
Emissions-Related | |||||||||||||||||||||||||
Financial Derivatives | Nominal | Fair | Nominal | Fair | Nominal | Fair | |||||||||||||||||||
€ in millions | value | value | value | value | value | value | |||||||||||||||||||
Electricity forwards | |||||||||||||||||||||||||
up to 1 year | 15,379.4 | 24.0 | 14,221.3 | (64.0 | ) | 7,521.9 | 41.6 | ||||||||||||||||||
1 year to 3 years | 4,722.5 | (116.1 | ) | 4,228.7 | (95.0 | ) | 2,306.2 | (39.9 | ) | ||||||||||||||||
4 years to 5 years | 54.4 | (5.0 | ) | 12.0 | (0.5 | ) | 59.6 | (0.4 | ) | ||||||||||||||||
more than 5 years | 9.6 | 0.8 | 1.9 | (0.1 | ) | 7.5 | (1.0 | ) | |||||||||||||||||
Subtotal | 20,165.9 | (96.3 | ) | 18,463.9 | (159.6 | ) | 9,895.2 | 0.3 | |||||||||||||||||
Exchange-traded electricity forwards | |||||||||||||||||||||||||
up to 1 year | 3,316.7 | (103.6 | ) | 2,402.8 | 49.6 | 3,085.4 | (93.3 | ) | |||||||||||||||||
1 year to 3 years | 1,621.4 | (18.1 | ) | 985.4 | 49.8 | 1,309.9 | (9.9 | ) | |||||||||||||||||
4 years to 5 years | 17.6 | (1.4 | ) | 17.6 | (1.4 | ) | — | — | |||||||||||||||||
more than 5 years | 1.9 | 0.1 | 1.9 | 0.1 | — | — | |||||||||||||||||||
Subtotal | 4,957.6 | (123.0 | ) | 3,407.7 | 98.1 | 4,395.3 | (103.2 | ) | |||||||||||||||||
Electricity swaps | |||||||||||||||||||||||||
up to 1 year | 88.3 | (21.6 | ) | — | — | 29.7 | 0.3 | ||||||||||||||||||
1 year to 3 years | — | — | — | — | 3.1 | (0.1 | ) | ||||||||||||||||||
4 years to 5 years | — | — | — | — | — | — | |||||||||||||||||||
more than 5 years | — | — | — | — | — | — | |||||||||||||||||||
Subtotal | 88.3 | (21.6 | ) | 0.0 | 0.0 | 32.8 | 0.2 | ||||||||||||||||||
Electricity options | |||||||||||||||||||||||||
up to 1 year | — | — | — | — | 8.8 | (0.2 | ) | ||||||||||||||||||
1 year to 3 years | — | — | — | — | — | — | |||||||||||||||||||
4 years to 5 years | — | — | — | — | — | — | |||||||||||||||||||
more than 5 years | — | — | — | — | — | — | |||||||||||||||||||
Subtotal | 0.0 | 0.0 | 0.0 | 0.0 | 8.8 | (0.2 | ) | ||||||||||||||||||
Exchange-traded electricity options | |||||||||||||||||||||||||
up to 1 year | 12.1 | (0.7 | ) | 12.1 | (0.7 | ) | 64.9 | (1.5 | ) | ||||||||||||||||
1 year to 3 years | 71.7 | (0.2 | ) | 71.7 | (0.2 | ) | 132.6 | (1.6 | ) | ||||||||||||||||
4 years to 5 years | — | — | — | — | — | — | |||||||||||||||||||
more than 5 years | — | — | — | — | — | — | |||||||||||||||||||
Subtotal | 83.8 | (0.9 | ) | 83.8 | (0.9 | ) | 197.5 | (3.1 | ) | ||||||||||||||||
Coal forwards and swaps | |||||||||||||||||||||||||
up to 1 year | 839.4 | (46.0 | ) | 127.2 | (2.8 | ) | 1,541.6 | 26.8 | |||||||||||||||||
1 year to 3 years | 439.9 | (3.0 | ) | 51.3 | (1.9 | ) | 851.2 | 18.3 | |||||||||||||||||
4 years to 5 years | 31.9 | (1.4 | ) | — | — | 112.0 | 1.1 | ||||||||||||||||||
more than 5 years | — | — | — | — | — | — | |||||||||||||||||||
Subtotal | 1,311.2 | (50.4 | ) | 178.5 | (4.7 | ) | 2,504.8 | 46.2 | |||||||||||||||||
Oil derivatives | |||||||||||||||||||||||||
up to 1 year | 845.0 | 106.1 | 103.5 | 0.6 | 405.0 | 28.5 | |||||||||||||||||||
1 year to 3 years | 341.7 | 59.1 | — | — | 266.0 | 28.1 | |||||||||||||||||||
4 years to 5 years | — | — | — | — | 2.8 | — | |||||||||||||||||||
more than 5 years | — | — | — | — | — | — | |||||||||||||||||||
Subtotal | 1,186.7 | 165.2 | 103.5 | 0.6 | 673.8 | 56.6 | |||||||||||||||||||
Gas forwards | |||||||||||||||||||||||||
up to 1 year | 4,628.7 | 380.8 | 483.8 | (65.2 | ) | 1,606.8 | 77.4 | ||||||||||||||||||
1 year to 3 years | 4,226.9 | 541.4 | 250.5 | (8.8 | ) | 1,117.9 | 131.7 | ||||||||||||||||||
4 years to 5 years | 763.7 | 27.4 | 61.7 | 1.5 | 426.0 | 2.0 | |||||||||||||||||||
more than 5 years | 92.6 | (17.7 | ) | — | — | — | — | ||||||||||||||||||
Subtotal | 9,711.9 | 931.9 | 796.0 | (72.5 | ) | 3,150.7 | 211.1 | ||||||||||||||||||
Carryover | 37,505.4 | 804.9 | 23,033.4 | (139.0 | ) | 20,858.9 | 207.9 | ||||||||||||||||||
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Thereof Trading | |||||||||||||||||||||||||
Total Volume of Electricity, Gas, Coal, Oil and | December 31, 2005 | December 31, 2005 | December 31, 2004 | ||||||||||||||||||||||
Emissions-Related | |||||||||||||||||||||||||
Financial Derivatives | Nominal | Fair | Nominal | Fair | Nominal | Fair | |||||||||||||||||||
€ in millions | value | value | value | value | value | value | |||||||||||||||||||
Carryover | 37,505.4 | 804.9 | 23,033.4 | (139.0 | ) | 20,858.9 | 207.9 | ||||||||||||||||||
Gas swaps | |||||||||||||||||||||||||
up to 1 year | 1,987.3 | 277.4 | 1,340.7 | 3.4 | 1,908.1 | 78.1 | |||||||||||||||||||
1 year to 3 years | 1,645.0 | 306.8 | 594.0 | 0.8 | 1,513.9 | 143.6 | |||||||||||||||||||
4 years to 5 years | 737.0 | 86.9 | — | — | 503.1 | (7.0 | ) | ||||||||||||||||||
more than 5 years | 1,892.3 | 7.9 | — | — | 373.8 | (24.2 | ) | ||||||||||||||||||
Subtotal | 6,261.6 | 679.0 | 1,934.7 | 4.2 | 4,298.9 | 190.5 | |||||||||||||||||||
Gas options | |||||||||||||||||||||||||
up to 1 year | 43.3 | (16.7 | ) | — | — | 34.1 | (7.6 | ) | |||||||||||||||||
1 year to 3 years | — | — | — | — | 24.5 | (7.7 | ) | ||||||||||||||||||
4 years to 5 years | — | — | — | — | — | — | |||||||||||||||||||
more than 5 years | — | — | — | — | — | — | |||||||||||||||||||
Subtotal | 43.3 | (16.7 | ) | 0.0 | 0.0 | 58.6 | (15.3 | ) | |||||||||||||||||
Emissions-related derivatives | |||||||||||||||||||||||||
up to 1 year | 98.4 | 4.9 | 92.3 | 0.8 | 28.8 | (0.5 | ) | ||||||||||||||||||
1 year to 3 years | 24.3 | 1.6 | 20.2 | 0.2 | 5.9 | (0.1 | ) | ||||||||||||||||||
4 years to 5 years | — | — | — | — | — | — | |||||||||||||||||||
more than 5 years | — | — | — | — | — | — | |||||||||||||||||||
Subtotal | 122.7 | 6.5 | 112.5 | 1.0 | 34.7 | (0.6 | ) | ||||||||||||||||||
Exchange-traded emissions-related derivatives | |||||||||||||||||||||||||
up to 1 year | 11.4 | 0.3 | 8.9 | 0.3 | — | — | |||||||||||||||||||
1 year to 3 years | 5.6 | 0.3 | 1.4 | 0.2 | — | — | |||||||||||||||||||
4 years to 5 years | — | — | — | — | — | — | |||||||||||||||||||
more than 5 years | — | — | — | — | — | — | |||||||||||||||||||
Subtotal | 17.0 | 0.6 | 10.3 | 0.5 | 0.0 | 0.0 | |||||||||||||||||||
Total | 43,950.0 | 1,474.3 | 25,090.9 | (133.3 | ) | 25,251.1 | 382.5 | ||||||||||||||||||
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December 31, 2005 | ||||||||||||||||||||||||||||||||
Total | Up to 1 Year | 1 to 5 Years | More than 5 Years | |||||||||||||||||||||||||||||
Rating of Counterparties | Counter- | Counter- | Counter- | Counter- | ||||||||||||||||||||||||||||
Standard & Poor’s and/or Moody’s | Nominal | party | Nominal | party | Nominal | party | Nominal | party | ||||||||||||||||||||||||
€ in millions | value | risk | value | risk | value | risk | value | risk | ||||||||||||||||||||||||
AAA and Aaa through AA- and Aa3 | 28,821.5 | 2,557.9 | 11,489.8 | 1,036.7 | 11,738.9 | 994.6 | 5,592.8 | 526.6 | ||||||||||||||||||||||||
AA- and A1 or A+ and Aa3 through A- and A3 | 19,604.5 | 1,108.4 | 8,416.0 | 787.4 | 8,791.6 | 314.9 | 2,396.9 | 6.1 | ||||||||||||||||||||||||
A- and Baa1 or BBB+ and A3 through BBB- or Baa3 | 4,805.1 | 652.1 | 3,503.1 | 450.8 | 997.8 | 201.3 | 304.2 | — | ||||||||||||||||||||||||
BBB- and Ba1 or BB+ and Baa3 through BB- and Ba3 | 1,403.0 | 182.4 | 944.1 | 142.7 | 372.4 | 38.8 | 86.5 | 0.9 | ||||||||||||||||||||||||
Other (1) | 23,246.3 | 2,648.2 | 15,276.2 | 2,067.9 | 5,760.1 | 530.1 | 2,210.0 | 50.2 | ||||||||||||||||||||||||
Total | 77,880.4 | 7,149.0 | 39,629.2 | 4,485.5 | 27,660.8 | 2,079.7 | 10,590.4 | 583.8 | ||||||||||||||||||||||||
(1) | This position consists primarily of parties to contracts with respect to which E.ON has received collateral from counterparties with ratings of the above categories or with an equivalent internal rating. |
(29) | Non-Derivative Financial Instruments |
December 31, 2005 | December 31, 2004 | ||||||||||||||||
€ in millions | Book value | Fair value | Book value | Fair value | |||||||||||||
Assets | |||||||||||||||||
Loans | 1,100 | 1,112 | 1,438 | 1,477 | |||||||||||||
Securities | 10,420 | 10,420 | 8,617 | 8,617 | |||||||||||||
Financial receivables and other financial assets | 2,019 | 2,019 | 2,124 | 2,124 | |||||||||||||
Cash and deposits at banking institutions | 5,859 | 5,859 | 4,233 | 4,233 | |||||||||||||
Total | 19,398 | 19,410 | 16,412 | 16,451 | |||||||||||||
Liabilities | |||||||||||||||||
Financial liabilities | 14,362 | 15,421 | 20,301 | 21,168 | |||||||||||||
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(30) | Transactions with Related Parties |
€ in millions | 2005 | 2004 | ||||||
Income | 5,408 | 4,846 | ||||||
Expenses | 2,913 | 2,530 | ||||||
Receivables | 2,263 | 1,686 | ||||||
Liabilities | 2,161 | 1,973 |
• | The Central Europe market unit, led by E.ON Energie AG, Munich, Germany, focuses on E.ON’s integrated electricity business and the downstream gas business in central Europe. | |
• | Pan-European Gas is responsible for the upstream and midstream gas business. Additionally, this market unit holds a number of minority shareholdings in the downstream gas business. The lead company of this market unit is E.ON Ruhrgas AG, Essen, Germany. |
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• | The U.K. market unit encompasses the integrated energy business in the United Kingdom. This market unit is led by E.ON UK plc, Coventry, U.K. | |
• | The Nordic market unit, which is led by E.ON Nordic AB, Malmö, Sweden, focuses on the integrated energy business in Northern Europe. It operates through the integrated energy company E.ON Sverige AB, Malmö, Sweden, and through E.ON Finland Oyj, Espoo, Finland, primarily in Sweden and Finland. | |
• | The U.S. Midwest market unit, led by E.ON U.S. LLC, Louisville, Kentucky, U.S., is primarily active in the regulated energy market in the U.S. state of Kentucky. | |
• | The Corporate Center contains those interests managed directly by E.ON AG that have not been allocated to any of the other segments, E.ON AG itself and the consolidation effects at the Group level. |
€ in millions | 2005 | 2004 | 2003 | |||||||||
Adjusted EBIT | 7,333 | 6,787 | 5,707 | |||||||||
Adjusted interest income (net) | (1,027 | ) | (1,031 | ) | (1,515 | ) | ||||||
Net book gains | 491 | 589 | 1,257 | |||||||||
Cost-management and restructuring expenses | (29 | ) | (100 | ) | (479 | ) | ||||||
Other non-operating earnings | 440 | 110 | 195 | |||||||||
Income/(Loss) from continuing operations before income taxes and minority interests | 7,208 | 6,355 | 5,165 | |||||||||
Income taxes | (2,276 | ) | (1,850 | ) | (1,145 | ) | ||||||
Minority interests | (553 | ) | (478 | ) | (445 | ) | ||||||
Income/(Loss) from continuing operations | 4,379 | 4,027 | 3,575 | |||||||||
Income/(Loss) from discontinued operations, net | 3,035 | 312 | 1,512 | |||||||||
Cumulative effect of changes in accounting principles, net | (7 | ) | — | (440 | ) | |||||||
Net income | 7,407 | 4,339 | 4,647 | |||||||||
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Central Europe | Pan-European Gas | U.K. | Nordic | ||||||||||||||||||||||||||||||||||||||||||||||
€ in millions | 2005 | 2004 | 2003 | 2005 | 2004(1) | 2003(1) | 2005 | 2004 | 2003 | 2005 | 2004 | 2003 | |||||||||||||||||||||||||||||||||||||
External sales | 24,047 | 20,540 | 18,983 | 16,835 | 12,671 | 11,530 | 10,102 | 8,480 | 7,915 | 3,369 | 3,281 | 2,776 | |||||||||||||||||||||||||||||||||||||
Intersegment sales | 248 | 212 | 270 | 1,079 | 556 | 389 | 74 | 10 | 8 | 102 | 66 | 48 | |||||||||||||||||||||||||||||||||||||
Total sales | 24,295 | 20,752 | 19,253 | 17,914 | 13,227 | 11,919 | 10,176 | 8,490 | 7,923 | 3,471 | 3,347 | 2,824 | |||||||||||||||||||||||||||||||||||||
Depreciation and amortization | (1,298 | ) | (1,121 | ) | (1,447 | ) | (387 | ) | (334 | ) | (371 | ) | (586 | ) | (575 | ) | (426 | ) | (379 | ) | (420 | ) | (386 | ) | |||||||||||||||||||||||||
Impairments(3) | (56 | ) | (185 | ) | (45 | ) | (16 | ) | (94 | ) | (4 | ) | (1 | ) | — | — | (8 | ) | — | (1 | ) | ||||||||||||||||||||||||||||
Adjusted EBIT | 3,930 | 3,602 | 2,979 | 1,536 | 1,344 | 1,401 | 963 | 1,017 | 610 | 806 | 701 | 546 | |||||||||||||||||||||||||||||||||||||
Thereof: earnings from companies accounted for at equity(4) | 189 | 143 | 290 | 509 | 419 | 406 | 17 | 43 | 36 | 9 | 10 | 21 | |||||||||||||||||||||||||||||||||||||
Intangible assets and property plant and equipment | 1,519 | 1,388 | 1,255 | 263 | 105 | 169 | 565 | 511 | 322 | 407 | 350 | 369 | |||||||||||||||||||||||||||||||||||||
Financial assets | 658 | 1,139 | 871 | 268 | 509 | 442 | 361 | (8 | ) | 66 | 131 | 390 | 896 | ||||||||||||||||||||||||||||||||||||
Investments | 2,177 | 2,527 | 2,126 | 531 | 614 | 611 | 926 | 503 | 388 | 538 | 740 | 1,265 | |||||||||||||||||||||||||||||||||||||
Total assets | 60,531 | 55,537 | 54,808 | 30,746 | 22,720 | 22,928 | 19,177 | 14,986 | 12,610 | 11,193 | 11,289 | 10,662 | |||||||||||||||||||||||||||||||||||||
U.S. Midwest | Corporate Center | Core Energy Business | Other Activities(2) | ||||||||||||||||||||||||||||||||||||||||||||||
€ in millions | 2005 | 2004(1) | 2003(1) | 2005 | 2004(1) | 2003(1) | 2005 | 2004(1) | 2003(1) | 2005 | 2004(1) | 2003(1) | |||||||||||||||||||||||||||||||||||||
External sales | 2,045 | 1,718 | 1,771 | 1 | 52 | 141 | 56,399 | 46,742 | 43,116 | — | — | 993 | |||||||||||||||||||||||||||||||||||||
Intersegment sales | — | — | — | (1,503 | ) | (844 | ) | (716 | ) | — | — | (1 | ) | — | — | 1 | |||||||||||||||||||||||||||||||||
Total sales | 2,045 | 1,718 | 1,771 | (1,502 | ) | (792 | ) | (575 | ) | 56,399 | 46,742 | 43,115 | — | — | 994 | ||||||||||||||||||||||||||||||||||
Depreciation and amortization | (195 | ) | (185 | ) | (192 | ) | (12 | ) | (22 | ) | (19 | ) | (2,857 | ) | (2,657 | ) | (2,841 | ) | — | — | (59 | ) | |||||||||||||||||||||||||||
Impairments(3) | — | — | — | (1 | ) | (18 | ) | (26 | ) | (82 | ) | (297 | ) | (76 | ) | — | — | — | |||||||||||||||||||||||||||||||
Adjusted EBIT | 365 | 354 | 318 | (399 | ) | (338 | ) | (323 | ) | 7,201 | 6,680 | 5,531 | 132 | 107 | 176 | ||||||||||||||||||||||||||||||||||
Thereof: earnings from companies accounted for at equity(4) | 17 | 17 | 17 | 9 | (42 | ) | 33 | 750 | 590 | 803 | 132 | 107 | 105 | ||||||||||||||||||||||||||||||||||||
Intangible assets and property plant and equipment | 227 | 247 | 411 | 9 | 11 | (24 | ) | 2,990 | 2,612 | 2,502 | — | — | 36 | ||||||||||||||||||||||||||||||||||||
Financial assets | — | — | — | (71 | ) | 467 | 4,200 | 1,347 | 2,497 | 6,475 | — | — | — | ||||||||||||||||||||||||||||||||||||
Investments | 227 | 247 | 411 | (62 | ) | 478 | 4,176 | 4,337 | 5,109 | 8,977 | — | — | 36 | ||||||||||||||||||||||||||||||||||||
Total assets | 9,296 | 7,643 | 8,367 | (6,186 | ) | (5,794 | ) | (5,971 | ) | 124,757 | 106,381 | 103,404 | 1,805 | 7,681 | 8,446 | ||||||||||||||||||||||||||||||||||
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E.ON Group | |||||||||||||
€ in millions | 2005 | 2004(1) | 2003(1) | ||||||||||
External sales | 56,399 | 46,742 | 44,109 | ||||||||||
Intersegment sales | — | — | — | ||||||||||
Total sales | 56,399 | 46,742 | 44,109 | ||||||||||
Depreciation and amortization | (2,857 | ) | (2,657 | ) | (2,900 | ) | |||||||
Impairments(3) | (82 | ) | (297 | ) | (76 | ) | |||||||
Adjusted EBIT | 7,333 | 6,787 | 5,707 | ||||||||||
Thereof: earnings from companies accounted for at equity(4) | 882 | 697 | 908 | ||||||||||
Intangible assets and property plant and equipment | 2,990 | 2,612 | 2,538 | ||||||||||
Financial assets | 1,347 | 2,497 | 6,475 | ||||||||||
Investments | 4,337 | 5,109 | 9,013 | ||||||||||
Total assets | 126,562 | 114,062 | 111,850 | ||||||||||
(1) | Adjusted for discontinued operations. |
(2) | The other activities of the E.ON Group include the 42.9 percent interest in Degussa accounted for at equity in the Consolidated Financial Statements. In addition, the balance-sheet data reported by segment also include the at-equity carrying amount of Degussa and the total assets and liabilities of Viterra, which in 2004 was still reported under other activities. |
(3) | For all periods presented, the impairment charges recognized in adjusted EBIT differed from the impairment charges recorded in accordance with U.S. GAAP. In 2005, the difference was the result of impairments recorded in the area of generation, specifically power-heat coupling plants in the U.K. market unit. In 2004, the difference was due to impairment charges on real property, on a municipal utility investment at the Central Europe market unit, and on an Asian power plant investment at the U.K. market unit, all of which were included in non-operating earnings. In 2003, the deviation was due to the impairment charge on an Asian power plant investment at the U.K. market unit, which was also included in non-operating earnings. |
(4) | For all periods presented, the earnings contributing to adjusted EBIT from companies accounted for at equity differed from the at-equity results recorded in accordance with U.S. GAAP. In 2005, this was the result of impairment charges included in non-operating earnings. They relate to the Fine Chemicals division of Degussa and to deferred tax assets of an at-equity holding of the Corporate Center. In 2004, the impairment charges on a municipal utility investment at the Central Europe market unit and on an Asian power plant investment at the U.K. market unit were responsible for the difference. In 2003, the deviation was due to the reclassification of at equity earnings from RAG in other non-operating earnings and to the impairment charge on the U.K. market unit’s Asian power plant investment, which was recorded in other non-operating earnings. |
€ in millions | 2005 | 2004 | 2003 | |||||||||
Interest and similar expenses (net) as shown in Note 6 | (736 | ) | (1,062 | ) | (978 | ) | ||||||
(+) Non-operating interest income, net (1) | (39 | ) | 151 | (62 | ) | |||||||
(-) Interest portion of long-term provisions | 252 | 120 | 475 | |||||||||
Adjusted interest income, net | (1,027 | ) | (1,031 | ) | (1,515 | ) | ||||||
(1) | This figure is calculated by adding interest expenses and subtracting interest income. In 2005, non-operating interest income primarily related to an eliminated provision for interest. In 2004, non operating interest-net income primarily reflected tax-related interest. |
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Europe (Eurozone | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Germany | excluding Germany) | Europe (other) | United States | Other | Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
€ in millions | 2005 | 2004 | 2003 | 2005 | 2004 | 2003 | 2005 | 2004 | 2003 | 2005 | 2004 | 2003 | 2005 | 2004 | 2003 | 2005 | 2004 | 2003 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
External sales | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
by location of customer | 33,557 | 28,621 | 27,124 | 3,030 | 2,179 | 2,235 | 17,743 | 14,110 | 12,407 | 1,990 | 1,770 | 2,051 | 79 | 62 | 292 | 56,399 | 46,742 | 44,109 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
by location of company | 36,635 | 30,028 | 28,484 | 1,476 | 1,462 | 1,546 | 16,243 | 13,482 | 11,827 | 1,980 | 1,711 | 2,073 | 65 | 59 | 179 | 56,399 | 46,742 | 44,109 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, plant and equipment | 19,010 | 23,171 | 23,418 | 1,339 | 1,283 | 1,331 | 16,819 | 15,327 | 13,898 | 4,072 | 3,693 | 4,044 | 83 | 89 | 106 | 41,323 | 43,563 | 42,797 |
(32) | Compensation of Supervisory Board and Board of Management |
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(33) | Subsequent Events |
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E.ON AG |
By: | /s/Dr. Erhard Schipporeit |
Dr. Erhard Schipporeit | |
Member of the Board of Management and | |
Chief Financial Officer | |
/s/Michael C. Wilhelm | |
Michael C. Wilhelm | |
Senior Vice President Accounting |