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Power holding MVM to boost profit, start gas trading in 2011

The state-owned Hungarian Electricity Works (MVM) plans to record pre-tax profit of more than HUF 50 billion this year, up from HUF 37 billion in 2010, thanks to an increase in power prices, chairman and CEO Csaba Baji told reporters on Tuesday.

MVM – which is the country's top power wholesaler and also owns the Paks nuclear power plant and power grid operator Mavir – plans to increase consolidated sales revenues from HUF 557 billion last year to more than HUF 600 billion this year.

Baji said that although power sales in volume terms are expected to remain unchanged this year, the company expects to benefit from an increase in electricity prices that took place after Germany shut down some of its nuclear reactors in the wake of the Fukushima nuclear accident in Japan.

In 2011, MVM will also enter the natural gas market, where it plans a "long-term, committed presence," according to Baji. A recent government decree allowed MVM to buy 200 million cubic meters of gas from Hungary's strategic reserves, and also granted gas import capacities to MVM – which will sell the gas to district heating companies, part of government efforts to keep household heating prices in check.

MVM also plans to expand its power wholesale trading activities abroad. In addition to existing operations in Austria and the Czech Republic, among others, new MVM subsidiaries are currently being registered in Croatia, Serbia and Slovenia. Later plans also include setting up units in Poland and France. (BSz)