2/13/2017

Ad-hoc announcement: Settlement by EVN Bulgaria in connection with compensation for additional costs for electricity from renewable energy in Bulgaria – positive effect on the Group net result 2016/17

With agreement dated 13 February 2017, the dispute between EVN Bulgaria EC EAD (“EVN Bulgaria”) and the state-owned Bulgarian electricity company NEK (“NEK”) regarding disputed compensation payments was settled out of court.
With agreement dated 13 February 2017, the dispute between EVN Bulgaria EC EAD (“EVN Bulgaria”) and the state-owned Bulgarian electricity company NEK (“NEK”) regarding disputed compensation payments was settled out of court. This settlement particularly encompasses the compensation for the still-outstanding part of the additional costs for electricity from renewable energy and default interest charges that arose from 1 July 2012 to 31 July 2013 that were financed in advance by EVN Bulgaria and which NEK is obliged to repay. This shall now be accomplished by mutually offsetting such claims of EVN Bulgaria with claims of NEK against EVN Bulgaria from power deliveries.
 
The international arbitration proceedings brought by EVN AG before the “International Centre for the Settlement of Investment Disputes” (ICSID) against the Republic of Bulgaria will remain active without regard to the execution of such agreement with NEK and subject to potential implications of such settlement.
 
The Group net result for the financial year 2016/17, which is derived from operating business, is – as already reported – expected to be largely stable, assuming average conditions in the energy business environment. The above-described settlement in Bulgaria will have an additional positive effect on the Group net result in the 2nd Quarter of the current financial year from the reversal of claims previously adjusted in connection herewith and default interest charges in the amount of approximately EUR 38 million.


Publication date: 13.2.2017; 1:47pm CET
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