Análisis de ratios: liquidez, eficiencia, rentabilidad y solvencia

E.ON exchanges goods and services with a large number of companies as part of its continuing operations. Some of these companies are related companies accounted for under the equity method or reported at fair value. Transactions with related parties are summarized as follows:

Income from transactions with related companies is gener- ated mainly through the delivery of gas and electricity to dis- tributors and municipal entities, especially municipal utilities. The relationships with these entities do not generally differ from those that exist with municipal entities in which E.ON does not have an interest.

Related-Party Transactions € in millions 2008 2007 Income 7,492 6,626 Expenses 3,627 4,407 Receivables 2,433 1,988 Liabilities 3,433 3,116

The income determined in accordance with IFRS 2 for the tranches of the E.ON SAR Program and the E.ON Share Per- formance Plan in existence in 2008 was €0.9 million (2007: €11.4 million expense).

Detailed and individualized information on compensation can be found on pages 150 through 155 of the Compensation Report.

The structural change within the E.ON group that was insti- tuted on January 1, 2008, has led to a new level of complex internal business relationships within the Group. Because of these relationships, there is no basis of data sufficient for the determination of reliable, meaningful figures for prior years. Under IFRS, segments or material business units that have been sold or are held for sale must be reported as discontinued operations. In 2008 and 2007, this concerned WKE, which is held for sale. The corresponding earnings and cash flow figures as of December 31, 2008, as well as those for the preceding periods, have been adjusted for all components of the discon- tinued operations (see explanations in Note 4).

Adjusted EBIT is used as the key figure at E.ON for purposes of internal management control and as an indicator of a business’s long-term earnings power. Adjusted EBIT is derived from income/loss before interest and taxes and adjusted to exclude certain special items. The adjustments include adjusted net interest income, net book gains, cost-management and restructuring expenses, goodwill impairments, as well as other non-operating income and expenses.

Adjusted net interest income is calculated by taking the net interest income shown in the income statement and adjusting it using economic criteria and excluding certain special items, i.e., the portions of interest expense that are non-operating. Net book gains are equal to the sum of book gains and losses from disposals, which are included in other operating income and other operating expenses. Cost-management and restruc- turing expenses are non-recurring in nature. Other non-oper- ating earnings encompass other non-operating income and expenses that are unique or rare in nature. Depending on the case, such income and expenses may affect different line items in the income statement. For example, effects from the marking to market of derivatives are included in other oper- ating income and expenses, while impairment charges on property, plant and equipment are included in depreciation, amortization and impairments.

Under IAS 24, compensation paid to key management personnel (i.e., the members of the Board of Management of E.ON AG) must be disclosed. The total expense for 2008 amounted to €14.5 million (2007: €16.1 million) in short-term benefits and €2.3 million (2007: €3.0 million) in post-employment benefits. The service cost of post-employment benefit is equal to the service cost of the provisions for pensions.

(33) Segment Information

The segment information of the E.ON Group is presented in line with the Company’s internal organizational and reporting structure.

• The Central Europe market unit focuses on E.ON’s elec- tricity business and the downstream gas business in central Europe.

• Pan-European Gas is responsible for the upstream and midstream gas business. Additionally, this market unit holds a number of minority shareholdings in the down- stream gas business.

• The U.K. market unit encompasses the energy business in the United Kingdom.

• The Nordic market unit is concentrated on the energy business in Northern Europe.

• The U.S. Midwest market unit is primarily active in the regulated energy market in the U.S. state of Kentucky. • Energy Trading has been conducting the trading activities

of the Central Europe, Pan-European Gas, Nordic, and U.K. market units since January 1, 2008. Energy Trading com- bines E.ON’s European trading activities for electricity, gas, coal, oil and CO2 allowances.

• New Markets contains the activities of the new Climate & Renewables, Italy, and Russia market units, which began operations on January 1, 2008, and, since July 1, 2008, the Spain market unit as well. This segment also includes the activities acquired in the wake of the agreement with Enel/Acciona S.A. and Endesa, which were fully consoli- dated as of June 30, 2008. The French activities that were also part of the agreement are reported within the Central Europe segment since the third quarter of 2008.

Corporate Center/Consolidation contains E.ON AG itself, the interests held directly by E.ON AG, as well as the consolidation effects that take place at Group level.

Net book gains in 2008 of €1,324 million were at roughly the same level as in the previous year (2007: €1,345 million). In 2008, these gains resulted primarily from the disposal of activities in the context of the agreement between E.ON and Statkraft concerning the acquisition of the E.ON Sverige shares from Statkraft. In addition, as in 2007, gains were generated from the sale of securities at the Central Europe market unit. In 2008, a total of €524 million in cost-management and restructuring expenses arose as part of a number of different restructuring and integration projects in the E.ON Group. A majority of the expenses related to structural measures primarily at German regional utilities and to costs incurred in connection with the implementation of the new corporate organizational structure, particularly as regards the central- ization of trading activities at the Energy Trading market unit. In 2007, only minor levels of cost-management and restruc- turing expenses were incurred.

Due to the adjustments, the key figures by segment may differ from the corresponding IFRS figures reported in the Consoli- dated Financial Statements.

The following table shows the reconciliation of adjusted EBIT to net income as reported in the IFRS Consolidated Financial Statements:

Net Income

€ in millions 2008 2007

Adjusted EBIT 9,878 9,208

Adjusted interest income (net) -1,835 -960

Net book gains 1,324 1,345

Restructuring/Cost management

expenses -524 -77

Goodwill impairments -3,315 – Other non-operating earnings -2,933 167 Income/Loss (-) from continuing

operations before taxes 2,595 9,683

Income taxes -863 -2,289

Income/Loss (-) from continuing

operations 1,732 7,394

Income/Loss (-) from discontinued

operations, net -128 330

Net income 1,604 7,724

Attributable to shareholders of E.ON AG 1,266 7,204 Attributable to minority interests 338 520

Financial Information by Business Segment

€ in millions

Central Europe Pan-European Gas U.K. 2008 2007 2008 2007 2008 2007

External sales 32,691 31,350 21,272 19,714 8,884 12,455

Intersegment sales 8,444 679 6,150 3,031 2,167 129

Sales 41,135 32,029 27,422 22,745 11,051 12,584

Adjusted EBITDA 6,266 6,222 3,113 3,176 1,396 1,657

Depreciation and amortization -1,498 -1,521 -494 -530 -474 -521

Impairments (-)/Reversals (+)1 _{-48 -31 12 -70 – –}

Adjusted EBIT 4,720 4,670 2,631 2,576 922 1,136

Earnings from companies accounted for under the equity method1 _{300 317 644 696 4 24}

Cash provided by operating activities 4,016 3,811 2,081 3,041 893 1,615

Investments 3,188 2,581 1,215 2,424 1,162 1,364

Intangible assets and property, plant and equipment 2,965 2,390 943 1,381 1,120 1,364

Equity investments2 _{223 191 272 1,043 42 –}

Total assets (December 31) 64,192 63,442 30,382 39,090 17,632 18,170

Intangible assets (December 31) 2,121 1,889 814 1,137 257 675

Property, plant and equipment (December 31) 20,418 18,375 6,773 6,746 5,878 7,506 Companies accounted for under the equity method (December 31) 2,193 2,134 5,871 5,602 – 2

1_{Impairments recognized in adjusted EBIT differ from the relevant amounts reported in accordance with IFRS due to impairments on companies accounted for under the equity}

method and impairments on other financial assets, and also due to impairments recognized in non-operating earnings. Under IFRS, impairments on companies accounted for under the equity method and impairments on other financial assets are included in income/loss (-) from companies accounted for under the equity method and financial results, respectively. In 2008, the differences resulted primarily from goodwill impairment charges, which are reported in non-operating earnings.

2_{In addition to those accounted for under the equity method, acquisitions of equity investments also include acquisitions of fully consolidated companies and investments in}

equity holdings that need not be consolidated. Acquisitions of equity investments are reported in the segment to which the acquiring entity is assigned. Accordingly, the New Markets equity investments are presented in the Corporate Center/Consolidation column and relate to the Endesa Europa/Viesgo activities in 2008, and to the purchase of OGK-4, E2-I and Airtricity in 2007.

An additional adjustment to the internal profit analysis relates to interest income, which is adjusted on an economic basis. Adjusted net interest income is calculated by taking the net interest income shown in the income statement and adjusting it using economic criteria and excluding certain special (i.e., non-operating) items.

Adjusted net interest income deteriorated by €875 million from its level in 2007. The determining factor behind this deterioration was the change in the net financial position. Transactions within the E.ON Group are generally effected at market prices.

Adjusted Net Interest Income

€ in millions 2008 2007

Interest and similar expenses (net) as shown in the Consolidated

Statements of Income -1,893 -951 Non-operating interest expense (+)/

income (-) 58 -9

Adjusted interest income (net) -1,835 -960

The goodwill impairment tests that must be performed at least annually according to IAS 36 resulted in an impairment charge of €1.5 billion on the goodwill of the U.S. Midwest market unit and in a further impairment charge of €1.8 billion on the as yet preliminary goodwill of the activities acquired from Enel/Acciona and Endesa in Italy, Spain and France. The topic is discussed in detail in Note 14(a).

Other non-operating earnings were characterized by two negative effects in particular. Firstly, negative effects in the amount of €2,176 million resulted from the marking to market of derivatives used to protect the operating businesses from fluctuations in prices. This same marking to market of deriv- atives produced a positive effect in the amount of €564 million as of December 31, 2007. Secondly, the financial market crisis made it necessary to write down the value of securities and financial assets held at the Central Europe market unit by a total of €667 million. Losses of this type were of minor sig- nificance in 2007.

Nordic U.S. Midwest Energy Trading New Markets

Corporate Center/

Consolidation E.ON Group 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2,683 3,216 1,880 1,819 13,767 – 5,543 253 33 -76 86,753 68,731 1,194 123 – – 17,993 – 319 -1 -36,267 -3,961 – – 3,877 3,339 1,880 1,819 31,760 0 5,862 252 -36,234 -4,037 86,753 68,731 1,112 1,027 549 543 649 – 510 43 -210 -218 13,385 12,450 -339 -345 -154 -155 -2 – -409 -36 -86 -15 -3,456 -3,123 -3 -12 – – -2 – -11 – 1 -6 -51 -119 770 670 395 388 645 0 90 7 -295 -239 9,878 9,208 5 10 21 23 – – -1 1 -5 7 968 1,078 835 914 271 216 -1,452 – 140 – -46 -871 6,738 8,726 939 914 650 690 8 – 3,305 207 7,939 3,126 18,406 11,306 923 892 650 690 7 – 2,250 183 138 16 8,996 6,916 16 22 – – 1 – 1,055 24 7,801 3,110 9,410 4,390 12,779 11,759 7,624 8,130 27,928 0 27,687 8,422 -31,179 -11,719 157,045 137,294 212 213 10 13 762 – 2,536 317 37 40 6,749 4,284 6,129 7,429 4,890 4,153 6 – 12,043 4,017 389 326 56,526 48,552 292 357 33 32 – – 315 284 277 – 8,981 8,411