Vattenfall presents strongest ever half-year results

Vattenfall presents the strongest half-year results and the best profit for the second quarter in the history of the company. • Net sales: + 12.7 % to SEK 64,328 million (2004: 57,071 million) • Operating profit excl. items affecting comparability: 18.1 % to SEK 13,827 million (11,705 million) • Net income after tax: + 24.7 % to SEK 8,486 million (6,805 million) • Operating profit excl. items affecting comparability for the second quarter: +23.0 % to SEK 4,631million (3,764 million)

Compared with the first half of 2004, operating profit increased by 22.8 per cent to SEK 13,823 million (11,260), excluding items affecting comparability by 18.1 per cent to SEK 13,827 million (11,705). Compared with the second quarter of 2004, operating profit increased by 27.2 per cent to SEK 4,604 million (3,619), excluding items affecting comparability by 23.0 per cent to SEK 4,631 million (3,764). The increase is chiefly attributable to the German operations, which have shown marked improvement, but also the Nordic region and Poland report improved operating profit. Consolidated net sales increased in the first half-year by 12.7 per cent to SEK 64,328 million (57,071) primarily attributable to Germany and an increase in energy trading. In the second quarter, sales increased by 16.0 per cent to SEK 29,292 million (25,261). The increase in sales can be explained to a large extent by higher German electricity market prices, which rose in response to a marked increase in market prices for emission rights for carbon dioxide. Vattenfall’s total electricity generation increased marginally in the first half-year to 85.6 TWh compared with 84.1 TWh for the equivalent period in 2004. However, hydro power generation increased by nearly 25 per cent to 20.2 TWh (16.2 TWh) as a result of good water supply. Nuclear power and fossil-based power dropped somewhat. As a result of major investments in the second quarter, of which slightly more than SEK 10 billion in Denmark, a record high dividend to the Swedish state of SEK 5.6 billion and negative exchange rate effects of SEK 3.4 billion, net debt increased by SEK 16.9 billion to SEK 68.3 billion compared with 31 March 2005. Capital Securities of SEK 9.2 billion issued in June, are included in net debt. On 31 December 2004, net debt amounted to SEK 55.4 billion. On 30 June, the net debt/equity ratio (net gearing) amounted to 85 per cent compared with 66 per cent as of 31 December 2004. Excluding Capital Securities, net gearing was 66 per cent as of 30 June 2005. The entire report is available at www.vattenfall.com (select “Investors” -> “Financial Reports”). Analysts’ conference and Conference Call at 10:00h At 10:00h (CET) Lars G Josefsson, President & CEO, and Matts Ekman, CFO, will host a conference call presenting the results, followed by a Question & Answer session. The conference call will be webcast. To participate in the Conference Call please dial one of the following numbers a few minutes before 10:00 CET: +44 (0) 20 7107 0611 (UK) +46 (0)8 5069 2105 (Sweden) +33 (0)1 7070 0543 (France) +49 (0) 69 2 22220593 (Germany) Playback: A playback will be available one hour after the conference call for at least 72 hours. Participants requesting the Digital Playback will be dialling +44 207 108 6233 (Number in UK) please enter the ID 180 followed by the # sign. Presentation slides: To download the presentation slides please go to http://www.vattenfall.com/ and select Investors -> Presentations. Slides will be available at around 09:15 CET Webcast To follow Vattenfall's presentation on the Internet (audio + slides), please click on the link “webcast” to be found on www.vattenfall.com -> Investors -> Presentations. The presentation will be archived for several months. Please note that you will need “Real Player” or “Windows Media Player” to follow the presentations. For further information, please contact: Knut Leman, Senior Vice President Communications, phone: +46 (8) 739 50 31 Klaus Aurich, Head of Investor Relations, phone: +46 (8) 739 65 14 Martin May, Head of Group Media Relations, phone: +46 (8) 739 52 70 From Vattenfall's Press Office, telephone: +46 8 739 50 10.