SECURITIES AND EXCHANGE COMMISSION
FORM 6-K
REPORT OF FOREIGN ISSUER
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of March, 2007
E.ON AG
E.ON AG
E.ON-Platz 1
D-40479 Düsseldorf
Germany
(Address of Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-Fþ Form 40-Fo
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yeso Noþ
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):
Press Release March 7, 2007 | ||||
• | Adjusted EBIT up 12 percent | |
• | Management to propose increased dividend of€3.35 | |
• | Gas price reductions for E.ON customers |
E.ON AG Press Release of March 7, 2007 | Page 2 of 8 | |
E.ON AG Press Release of March 7, 2007 | Page 3 of 8 | |
1 | Non-GAAP financial measure; see reconciliation to net income in the tables Net Income and Interest Income at the end of this press release. | |
2 | Non-GAAP financial measure; see reconciliation to net income in the table Adjusted Net Income at the end of this press release. | |
3 | Non-GAAP financial measure; see derivation in the tables Cost of Capital and ROCE at the end of this press release. | |
4 | Excludes special dividend. |
E.ON AG Press Release of March 7, 2007 | Page 4 of 8 | |
€ in millions | 2006 | 20051 | +/– % | |||||||||
Adjusted EBITDA2 | 11,353 | 10,194 | +11 | |||||||||
Depreciation,amortization, and impairments affecting adjusted EBIT3 | –3,203 | –2,901 | — | |||||||||
Adjusted EBIT2 | 8,150 | 7,293 | +12 | |||||||||
Adjusted interest income (net)4 | –1,081 | –1,027 | — | |||||||||
Net book gains | 1,205 | 491 | — | |||||||||
Restructuring expenses | — | –29 | — | |||||||||
Other nonoperating earnings | –3,141 | 424 | — | |||||||||
Income/Loss (–) from continuing operations before income taxes and minority interests | 5,133 | 7,152 | –28 | |||||||||
Income taxes | 323 | –2,261 | — | |||||||||
Minority interests | –526 | –536 | — | |||||||||
Income/Loss (–) from continuing operations | 4,930 | 4,355 | +13 | |||||||||
Income/Loss (–) from discontinued operations,net | 127 | 3,059 | — | |||||||||
Income/Loss (–) from cumulative effect of changes in accounting principles,net | — | –7 | — | |||||||||
Net income | 5,057 | 7,407 | –32 |
1 | Adjusted for discontinued operations. | |
2 | Non-GAAP financial measure. | |
3 | In 2006 and 2005,the impairment charges recognized in adjusted EBIT differed from the impairment charges recorded in accordance with U.S. GAAP. In 2006, non-operating earnings can be traced to regulatory impairments on property, plant and equipment and on shareholdings at the Central Europe and Pan-European Gas market units. In addition, impairments have again been recorded in the area of generation, specifically cogeneration facilities at the U.K. market unit. Additional impairments concern intangible assets and property, plant and equipment at the Pan-European Gas, U.K. and Nordic market units. In 2005, the difference was the result of impairments recorded in the area of generation, specifically cogeneration facilities at the U.K. market unit. The commentary is transferred from Note 31 of the Notes to the Consolidated Financial Statements. | |
4 | See the table on the next page for a reconciliation to interest income. |
E.ON AG Press Release of March 7, 2007 | Page 6 of 8 |
€ in millions | 2006 | 2005 | ||||||
Net interest expense | -194 | -256 | ||||||
(+) Income from loans | 31 | 31 | ||||||
(-) Accretion expense related to the adoption of SFAS 143 | 524 | 511 | ||||||
Interest and similar expenses (net) | -687 | -736 | ||||||
(+) Non-operating interest income (net)2 | -5 | -39 | ||||||
(-) Interest portion of long-term provisions | 389 | 252 | ||||||
Adjusted interest income (net) | -1,081 | -1,027 |
1 | The reconciliation is transferred from Note 31 of the Notes to the Consolidated Financial Statements. | |
2 | 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 that had been recognized in previous years. |
€ in millions | 2006 | 2005 | +/- % | |||||||||
Net income | 5,057 | 7,407 | -32 | |||||||||
Nonoperating earnings, net, and extraordinary tax effects1 | -544 | -715 | — | |||||||||
Income/Loss (-) from discontinued operations, net, and from the cumulative effect of changes in accounting principles, net | -127 | -3,052 | — | |||||||||
Adjusted net income2 | 4,386 | 3,640 | +20 |
1 | Extraordinary tax effects primarily reflect corporate tax credits of € 1.3 billion. | |
2 | Non-GAAP financial measure. |
E.ON AG Press Release of March 7, 2007 | Page 7 of 8 | |
2006 | ||||
Risk-free interest rate | 5.1 | % | ||
Market premium1 | 5.0 | % | ||
Beta factor2 | 0.7 | |||
Cost of equity after taxes | 8.6 | % | ||
Cost of debt before taxes | 5.6 | % | ||
Tax shield (tax rate: 35%)3 | –2.0 | % | ||
Cost of debt after taxes | 3.6 | % | ||
Share of equity | 45 | % | ||
Share of debt | 55 | % | ||
Cost of capital after taxes | 5.9 | % | ||
Tax rate | 35 | % | ||
Cost of capital before taxes | 9.0 | % |
1 | The market premium reflects the higher long-term returns of the stock market compared with German treasury notes. | |
2 | The beta factor is used as an indicator of a stock’s relative risk. A beta of more than one signals a higher risk than the risk level of the overall market; a beta factor of less than one signals a lower risk. | |
3 | The tax shield takes into consideration that the interest on corporate debt reduces a company’s tax burden. |
E.ON AG Press Release of March 7, 2007 | Page 8 of 8 | |
€ in millions | 2006 | 2005 | ||||||
Adjusted EBIT1 | 8,150 | 7,293 | ||||||
Goodwill, intangible assets, and property, plant, and equipment | 61,585 | 60,811 | ||||||
+ Shares in affiliated and associated companies and other share investments | 21,358 | 19,426 | ||||||
– Adjustment for mark-to-market valuation2 | 8,789 | 5,677 | ||||||
+ Inventories | 3,990 | 2,457 | ||||||
+ Accounts receivable | 9,756 | 8,269 | ||||||
+ Other noninterest-bearing current assets, including prepaid expenses and deferred taxes | 13,991 | 15,520 | ||||||
– Noninterest-bearing provisions3 | 13,375 | 10,685 | ||||||
– Noninterest-bearing liabilities, including deferred income and deferred taxes | 28,363 | 28,289 | ||||||
Capital employed (at year end) | 60,153 | 61,832 | ||||||
Capital employed (annual average)4 | 61,568 | 60,398 | ||||||
Capital employed (discontinued operations)5 | — | 410 | ||||||
Capital employed (continuing operations, annual average) | 61,568 | 59,988 | ||||||
ROCE6 | 13.2 | % | 12.2 | % | ||||
Cost of capital | 9.0 | % | 9.0 | % | ||||
Value added6 | 2,586 | 1,920 |
1 | Non-GAAP financial measure; see reconciliation to net income on page 5. | |
2 | Capital employed no longer includes the mark-to-market valuation of other share investments or related deferred-tax effects. | |
3 | Noninterest-bearing provisions mainly include short-term provisions. They do not include provisions for pensions and nuclear waste management. | |
4 | In order to better depict intraperiod fluctuations in capital employed, annual average capital employed is calculated as the arithmetic average of the amounts at the beginning of the year, the end of the year, and the balance-sheet dates of the three interim reports. Capital employed amounted to €63,839 million, €61,157 million, and €60,859 million at March 31, June 30, and September 30, 2006, respectively. | |
5 | In 2005 the annual average capital employed of E.ON Finland was €410 million. | |
6 | Non-GAAP financial measure. |
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Current Report to be signed on its behalf by the undersigned, thereunto duly authorized.
E.ON AG | ||
Date: March 8, 2007 | By: /s/ Michael C. Wilhelm | |
Michael C. Wilhelm Senior Vice President Accounting |