Report of the CEO

Efficiency programme on track

To bolster performance in the coming years, Repower introduced a programme to enhance efficiency at the start of 2013. The full effects of the programme, which will result in savings of around CHF 15 million per year, will be felt for the first time in 2014, although the measures already produced a very positive financial effect in 2013: the total savings amounted to CHF 7 million. The efficiency programme includes a simplification of the organisational structure, downsizing of the Executive Board, cost reductions in the areas of consulting, mobile communication, vehicles and insurance, and a streamlining of the project portfolio with a reduction in investments, including capital expenditure for modernisation and replacement to a maximum of CHF 700 million in the next 10 years. In 2014 Repower will continue rigorously pursuing its efforts to implement the efficiency programme and go on with its strict cost control. Processes to simplify the legal structures at Repower in Switzerland are currently underway. Repower Holding Surselva AG and Repower Klosters AG, both subsidiaries of Repower AG, are merged into Repower Schweiz AG, reducing the administrative burden and, in particular, making it easier to process regulatory requirements. A similar process was conducted in Italy at the start of 2014, when Repower Holding Italia S.p.A. was integrated with Repower Italia S.p.A.