2003 interim results

The main factors influencing the Atel Group's results in the first half of the year were the three new companies in the Czech Republic and Hungary. Power-trading company Entrade in Prague, the Csepel power stations in Budapest and the ECKG power stations in Prague have been fully included in the consolidated accounts since 1 January 2003. All three companies are operating successfully, with a positive influence on the Atel Group's results in the first half of the year. The Energy Services segment, in contrast, saw sales decline because of the weak economy. The segment nevertheless performed well overall in the first half of the year.

Improved earnings power The Atel Group's consolidated sales grew by 29% in the first six months to CHF 2,340 million, while in local currencies and with first consolidations excluded the growth rate was 3%. The substantial improvement in the Atel Group's operating earnings power is particularly encouraging. Operating profit (EBIT) rose by 43% to CHF 189 million. Consolidated cash flow exceeded the first-half figure for 2002 by 4%, reaching CHF 285 million. Group profit was CHF 137 million, up 33% year on year. With the newly-consolidated companies excluded, group profit was up by 7%.

Vigorous growth in the Energy segment Atel's Energy business performed successfully in the first half of 2003 in all regions and all market sectors. First-half sales in the Energy segment increased by 55% to CHF 1,726 million. Most of this rise can be attributed to the new member companies of the Atel Group, the Entrade power trader and the Csepel and ECKG power stations - but even with these first consolidations excluded, sales grew by 12%. In the period under review Atel sold a total of 31.2 billion kWh of electricity, which represents an increase of 63%. In addition to its traditional physical deliveries in the first half of 2003, Atel conducted trading transactions with standardised products with a total volume of around 29.7 billion kWh (2002: 21 billion kWh) and a value of around CHF 1,100 million (2002: CHF 800 million). Consolidated earnings in the Energy segment rose to CHF 139 million, exceeding the previous year's figure by 14%.

Decline in the Energy Services segment The Atel-Installationstechnik Group (AIT) in Switzerland and the GAH Group in Germany achieved sales of CHF 652 million in the Energy Services segment. This is equivalent to a decline of 6% in comparison with the first half of 2002, or 7% in local currencies and with first consolidations excluded. The difficult market situation in our two principal markets, Germany and Switzerland, was the most important reason for this decrease. Both the GAH Group and the AIT Group responded to the persistent weakness of economic activity by making capacity adjustments. Even though sales were down, the Energy Services segment performed well overall. Consolidated earnings reached CHF 4 million (2002: CHF 5 million).

Outlook - clear positive trends Atel expects continued success in its business activities in the second half of the year. For the full year the company therefore expects double-digit percentage rises in both sales and profits.

Aare-Tessin Ltd. for Electricity Corporate Communications

Note to editors: The complete Interim Report for 2003 is available as pdf document.

Atel Group: key figures