ANNUAL REPORT 2011 - DONG Energy
ANNUAL REPORT 2011 - DONG Energy
ANNUAL REPORT 2011 - DONG Energy
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was brought back online in October <strong>2011</strong>, while the other<br />
unit is expected to be brought back online in the first half<br />
of 2012. Both units are running at reduced output until the<br />
repairs have been completed. The gas-fired Enecogen<br />
power station in the Netherlands became operational at<br />
the end of <strong>2011</strong>, generating 0.2 TWh.<br />
financial performance<br />
Revenue increased by DKK 2.2 billion to DKK 33.7 billion<br />
due to higher electricity generation and gas sales and<br />
higher gas sales prices than in 2010.<br />
EBITDA was DKK 2.0 billion, DKK 1.0 billion down on<br />
2010, primarily reflecting lower earnings from gas sales under<br />
fixed-priced and oil-indexed contracts than in 2010.<br />
Renegotiation of gas contracts had a significant positive<br />
effect of around DKK 1 billion in <strong>2011</strong>, while the new gasfired<br />
power stations in the UK and the Netherlands depressed<br />
EBITDA due to the low green spark spreads. The<br />
consolidated EBITDA effect of the new gas-fired power stations<br />
was neutral.<br />
EBIT was down DKK 1.6 billion at DKK 0.8 billion in <strong>2011</strong><br />
due to the lower EBITDA and a DKK 0.6 billion impairment<br />
loss on offshore gas pipelines in the first half of <strong>2011</strong>.<br />
Environment<br />
EU ETS CO emissions rose compared with 2010, as <strong>2011</strong> was<br />
2<br />
the first full year of operation for the Severn power station. A<br />
small portion of CO emissions was due to flaring at the Ny-<br />
2<br />
bro gas treatment plant. This portion was in line with 2010.<br />
Sales & Distribution<br />
performance highlights <strong>2011</strong> 2010<br />
Volumes<br />
Gas sales TWh 20.3 24.2<br />
Gas distribution TWh 9.9 11.4<br />
Electricity sales TWh 7.6 8.2<br />
Electricity distribution<br />
Oil transportation,<br />
TWh 8.8 9.1<br />
Denmark million bbl 72 78<br />
Financial performance<br />
Revenue DKK million 13,009 14,185<br />
EBITDA DKK million 2,027 2,036<br />
EBIT<br />
Adjusted operating<br />
DKK million 566 1,057<br />
profi t DKK million 584 1,072<br />
Gross investments<br />
Capital employed<br />
DKK million (810) (858)<br />
Capital employed DKK million 10,944 12,064<br />
PPE under construction DKK million<br />
Production assets<br />
transferred from PPE<br />
under construction in<br />
(530) (507)<br />
the past six months<br />
Adjusted capital<br />
DKK million (447) (511)<br />
employed DKK million 9,967 11,046<br />
volumes<br />
Gas sales were 20.3 TWh, down 16% on 2010, primarily<br />
reflecting the milder winter than in 2010 and growing competition<br />
in the Danish market, with a resulting decline in<br />
market share.<br />
Gas distribution was also affected by the milder winter,<br />
amounting to 9.9 TWh, a decrease of 13% on 2010.<br />
There was also a small decline in both distribution and<br />
sales of electricity and in transportation in the oil pipeline<br />
compared with 2010.<br />
financial performance<br />
Revenue was down DKK 1.2 billion, at DKK 13.0 billion, primarily<br />
reflecting lower gas volumes being sold due to intensifying<br />
competition and milder weather in <strong>2011</strong> as well<br />
as a fall in payments recovered from consumers on behalf<br />
of Energinet.dk. These collected payments have no EBITDA<br />
effect.<br />
The lower revenue was offset by a lower cost level.<br />
EBITDA was consequently DKK 2.0 billion in <strong>2011</strong>, the<br />
same level as the previous year.<br />
EBIT was down DKK 0.5 billion, amounting to DKK 0.6<br />
billion in <strong>2011</strong>. The decline primarily reflected a DKK 0.3<br />
billion impairment loss on goodwill related to the Dutch<br />
sales subsidiary in <strong>2011</strong> due to changed pricing in the<br />
Dutch market.<br />
Environment<br />
A significant environmental incident occurred in <strong>2011</strong> in<br />
connection with the establishment of a motorway, when a<br />
gas pipe suffered excavation damage by the contractor,<br />
resulting in a leak of 36 thousand m3 of methane. After the<br />
fracture, the gas supply was shut off immediately to prevent<br />
a major gas leak. Internal and external emergency plans<br />
functioned as planned and the damage was rapidly repaired.<br />
<strong>DONG</strong> ENERGY <strong>DONG</strong> ENERGY GROUP <strong>ANNUAL</strong> <strong>REPORT</strong> <strong>2011</strong> – manaGEmEnt’s rEviEw 39