EDF Energies Nouvelles SA (EDF) has reported revenues of EUR1.01 billion for the year-end 2008, up 79.6%, compared with the revenues of EUR560.5 million in the previous year-end. It has also reported a net income of EUR79.6 million for the year-end 2008, up 43.2%, compared with the net income of EUR53.7 million in the previous year-end.

Commenting on this performance, Paris Mouratoglou, chairman of the board of directors, stated:

“In spite of a downbeat economic situation, the EDF Energies Nouvelles group posted strong growth in 2008 earnings and again met the objectives it set ahead of its IPO. The Group anticipates further growth in 2009. The wind energy business enjoyed a very brisk pace of development, with numerous new facilities commissioned, notably in France and Portugal where we brought into service facilities ranking among the largest projects completed in Europe. Thanks to a successful capital increase last autumn, the Group has confirmed its ambitions in the solar photovoltaic segment, as reflected by the commissioning at the end of the year of the Narbonne facility, the largest solar farm in France to date.”

Operational Performance

The Group’s installed capacity amounted to 2,275.3 megawatt (MW) gross at 31 December 2008, up 57.7% compared with 31 December 2007.

Meanwhile, net capacity surged from 1,035.2 MW at year-end 2007 to 1,564.4 MW at 31 December 2008, representing an increase of 51.1%.

Wind energy

Wind energy capacity in service amounted to a gross figure of 2,030.6 MW at 31 December 2008, up 812.7 MW compared with the previous year (increase of 66.7%). During the fourth quarter alone, the Group commissioned 433.5 MW in gross capacity, namely the final tranche of the Ventominho wind farm, as well as the first two tranches of the Arada facility (92 MW out of a total of 112 MW) in Portugal, the Chemin d’Ablis and Salles-Curan wind farms in France, the Campidano wind farm in Italy and, lastly, the Wapsi North project in the United States. In addition, the Group developed and built 351.3 MW in capacity for third parties during the year.

Solar

Gross installed solar capacity went up from 0.9 MWp at year-end 2007 to 20.8 MWp at December 31, 2008. During the fourth quarter, the Narbonne solar farm (7 MWp), the largest such facility in France, was commissioned. Over the year as a whole, the Group brought into service 7.3 MWp in France, 4.8 MWp in capacity in Italy, 6.1 MWp in Spain and 1.6 MWp in the US.

Financial Performance

Generation revenues moved up 30.9% to EUR228.5 million, keeping up the trend set in 2007. At constant exchange rates, revenues rose by 35.1%. This growth is attributable to the increase in wind energy generation (up 35.4%), which was boosted by the facilities commissioned in 2008 and the full-year contribution made by wind farms commissioned in 2007. The wind farms that entered service in 2008, mostly towards the end of the year, will have a major impact in 2009.

Operations & Maintenance revenues went up from EUR11 million in 2007 to EUR24 million in 2008 as a result of the signing of numerous contracts in the United States (representing 2,139 MW), where enXco, the Group’s US subsidiary, has extended its leadership in third-party operations & maintenance services.

Development and sale of structured asset (DSSA) revenues recorded an increase of 51.8% to EUR569.1 million owing chiefly to the delivery of the Walnut (153 MW) and Grand Meadows (100.5 MW) projects in the US. This growth was also powered by a healthy level of business in Europe, notably including the first sales of solar farms.

Distributed Energies1 revenues came to EUR185 million. The chief contributors were Supra (EUR66.1 million) and Tenesol (EUR95.8 million). Revenues from the sale of distributed energy solutions, which stood at near EUR1 million at the end of the first half, reached EUR20.5 million at year-end 2008, confirming the success of the photovoltaic offerings for the residential market.

EBITDA2.

The Group’s EBITDA totalled EUR215.9 million, up 60.8% compared with 2007.

In Europe, EBITDA moved up 129.2% to EUR151.5 million. All the Group’s business lines contributed to this increase. The Generation business was underpinned by the new facilities commissioned in 2008, in particular those in Portugal (332 MW), France (197 MW), Italy (75 MW), the United Kingdom (40 MW) and Greece (38 MW), and by the full-year impact of plants commissioned in 2007. DSSA also increased, particularly with the initial transactions in the solar photovoltaic segment. Lastly, EDF Energies Nouvelles Reparties provided an additional contribution, albeit a modest one by comparison with the Group’s overall performance, since this business is still at the start-up phase.

In North America, EBITDA was stable in dollar terms. The full-year impact of the commissioning of the Fenton wind farm (205 MW gross) and the first-class performance of the Operations & Maintenance business offset the smaller contribution to regional earnings posted by DSSA projects than in the previous year (negative impact of the Goodnoe project in the north-western US). Translated into euros, EBITDA declined from EUR68.2 million to EUR64.4 million in 2008, representing a slight decline of 5.6% owing to depreciation in the US dollar.

Operating income surged from EUR95.5 million to 158.6 million, representing an increase of 66.1%. Depreciation and amortization, which moved up 47.3% to EUR57.3 million, kept pace with the commissioning of new facilities.

Net financial expense worked out at EUR42.6 million, up from EUR24.6 million in 2007. This increase was primarily attributable to the rise in debt deriving from the facilities the Group commissioned during 2007 and 2008.

Income tax expense soared from EUR18.4 million to EUR37.1 million. The effective tax rate reached 32% in 2008, compared with 26% in 2007. This increase was the result of a carry-back transaction in the United States relating to the 2006 and 2007 financial years, which has enabled the Group to secure the repayment of more than $20 million in tax, but increased the effective tax rate by deferring use of the tax credits (PTC)3 for the past three years until 2009.

Cash Flow

Operating cash flow recorded during the financial year amounted to EUR192.9 million, up 52.2% compared with 2007.

The working capital requirement grew by EUR199 million. Factors contributing to this increase included mainly the build-up of an inventory of solar photovoltaic panels as this business ramped up and sales of assets completed towards the end of the year, for which payment was not received by December 31, 2008.

As predicted, capital expenditure posted a steep increase, moving up from EUR523.2 million in 2007 to EUR1,069.5 million in 2008. It included EUR101.9 million in investments in subsidiaries and affiliates (mainly Nanosolar, Polat Enegy and Tenesol) and EUR967.6 million with more than 95 % corresponding to spending on additional wind and solar energy generating capacity, thereby maintaining the brisk pace of commissioning in wind energy and the faster rate of development in the solar photovoltaic segment.