Vattenfall (VF) Q2 2024 earnings summary

Executive summary

• Underlying EBIT increased by SEK 3.3 billion to SEK 17.9 billion, driven by higher Nordic prices, hedges, and capital gains from asset sales.

• Profit for the period rose to SEK 26.2 billion, mainly due to non-recurring gains from wind and heat asset divestments.

• Net sales declined by 19% to SEK 128.5 billion, reflecting lower electricity and gas prices.

• Major strategic moves included winning the IJmuiden Ver Beta offshore wind tender, selling 49% of Nordlicht I & II to BASF, and completing the Berlin heat business divestment.

• Directional decision to extend Forsmark and Ringhals nuclear plant lifetimes from 60 to 80 years, with progress on new nuclear projects and SMR supplier shortlisting.

Financial highlights

• EBITDA increased 60% to SEK 43.4 billion; EBIT up 141% to SEK 32.6 billion; profit for the period up 279% to SEK 26.2 billion.

• Underlying EBIT rose to SEK 17.9 billion, supported by higher achieved prices and asset sales.

• Cash flow from operating activities improved to SEK 27.5 billion; net debt reduced to SEK 14.4 billion.

• Adjusted net debt/EBITDA improved to 1.5x; ROCE rose to 11.5% from 0.5% YoY.

• FFO/adjusted net debt increased to 40.9%, well above target.

Segment performance

• Power Generation: Underlying EBIT up 87% on Nordic hedges and higher hydro/nuclear output.

• Wind: Underlying EBIT down 6%, as higher volumes from new wind farms were offset by lower prices and higher costs.

• Customers & Solutions: Underlying EBIT down 24% due to lower gas-fired margins and heat prices; customer base declined 2%.

• Distribution: Underlying EBIT down 20% due to higher grid and personnel costs, despite increased sales in Sweden.

• Other: Underlying EBIT up, mainly from the Berlin heat business until divestment.