Verbund stock resets 2026 targets after weak hydropower quarter

VERBUND reported a sharp deterioration in its first nine months on November 5, as historically low water supply and lower realized hydropower prices weighed on earnings. The Austrian utility said EBITDA fell 29.0 percent year on year to 1,498.5 million euros, while the Group result declined 43.5 percent to 684.8 million euros. The figures come from the company's corporate results release.

VERBUND stock traded at 72.48 euros on Lang & Schwarz at 11:42 CET on Wednesday, November 11. The quote is presented without a daily direction because no usable dated Xetra closing comparison was available.

Low water weighs on generation

Hydropower generation fell by 4,047 GWh, or 20.2 percent, to 15,984 GWh in the first three quarters. The hydro coefficient for run-of-river plants was 0.61, compared with 0.79 a year earlier and 39 percentage points below the long-term average.

Lower output was compounded by weaker realized prices. The average sales price for VERBUND's own hydropower generation dropped by 33.8 euros per megawatt-hour to 79.7 euros per megawatt-hour. The company said extensive electricity buybacks were needed to cover volumes that had already been sold but could not be generated because of the low water supply. Those purchases took place at substantially higher spot prices.

Revenue declined 5.4 percent to 5,560.4 million euros. The reported Group result was 684.8 million euros, while the result adjusted for non-recurring effects reached 725.0 million euros, down 37.3 percent from the prior-year period. Operating cash flow fell 26.5 percent to 1,216.3 million euros, and free cash flow before dividends dropped 89.7 percent to 78.0 million euros.

Specific targets replace ranges

VERBUND replaced its previous 2026 forecast ranges with specific targets. The company expects EBITDA of 2,120 million euros, a reported Group result of 1,010 million euros and an adjusted Group result of 1,050 million euros. The updated outlook includes below-average water supply in October and assumes average own generation from hydropower, wind power and photovoltaics in November and December.

Wind and photovoltaic generation rose by 70 GWh to 1,622 GWh after new facilities entered operation. Even so, the generation coefficient for wind and photovoltaic power was 0.80, below the planned level of 1.00 and slightly below the prior-year figure of 0.81. The planned payout ratio for 2026 is between 45 percent and 55 percent of the adjusted Group result.

Austria's ATX market environment remains relevant as investors assess the utility's exposure to hydrology, power prices and renewable capacity expansion.

For investors, the next focus is whether water conditions and own generation normalize during November and December, as assumed in the revised outlook. More news and analyses on Verbund stock will track the outlook and the company's next financial update.