Saturday 22 November 2014

E.On report Q3 2014

E.On, Q3, 2014, front page

When this report arrived there were maybe 15 minutes of excitement and the share price increased a little but since then it has been down, down, down and just to make things crystal clear a fourth down is needed. Was then the response from the market justified?

Heck Yeah! This report was awful in every possible sense and I was hoping for a better one especially since the previous one E.On. report Q2 2014 was also awful! One bad report is, no bad report. A second bad report is two too many. For the report in full please go here.

So looking at the income statement we see that the sales are down by over -10%. The cost of material has amazingly increased! How is that even possible. Oil price is down, gas is down, the coal that they burn a lot of is being traded at prices it were at in 2003! The most wonderful thing is on the very bottom of the table: -835 MILLIONS EURO during Q3 2014 and for the full year we are -14 million euro. Well done management! I hope you gave yourselves a nice pat on the back.

E.On, Q3, 2014, income statement

What else of fun could be found? Well... we could look at the income expenses table to lighten things up a little. Oh, there is a remeasurement of a benefit plan. Woow! And it only carries the cost of -1.15 BILLION EURO in the quarter and -2.5 BILLION EURO for the full year. This is good news indeed and at the bottom line we see that in this quarter attributable to the shareholders are -2 billion €. With 2 billion shares outstanding that means that I should from my pocket pay E.On 1 € per share. For the full year E.On. is -2.2 billion euro.

E.On, Q3, 2014, expenses

With these excellent results at least the management did not pat themselves on the shoulders and gave themselves a bonus. Nicely hidden among the restructuring costs. I am sure the fired employees that were part of that restructuring received the big bulk of that money! (wink, wink, wink, say no more - Monty Python).

E.On, Q3, 2014, incompetence

Conclusion: E.On has definitely not managed to improve anything at all. They have even managed to sink the boat one step further and yet the management are paying themselves bonuses while the company goes -2 billion euro. Could it be that it is time to change the management and the board into people that knows how to count? I have no high demands. It will be enough with a person that can count on their ten fingers since then at least he or she is better than the current people sitting there. I will remain as shareholder but I am not happy. Oh, and since the new rule is to pay out 50-60% of the earnings we shareholders can of course forget to receive any dividends for 2014.

If you feel crazy enough and want to find out more about E.On then please click here analysis of E.On. 2014.

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