* Q2 op loss 323 mln euros vs year-ago 188 mln profit
* Writes down more than 1 bln euros of assets
* CEO says cannot rule out further writedowns
* Shares up 0.2 percent (Adds CEO comments, shares)
By Georgina Prodhan
VIENNA, July 31 (Reuters) - Austrian hydropower company Verbund AG fell to a second-quarter operating loss on large writedowns and said it could not rule out further impairment charges due to upheaval in electricity markets.
Verbund made an operating loss of 323 million euros ($428 million) against a profit of 188 million a year earlier as it struggled to compete with heavily subsidised renewable energy sources.
The company wrote down more than 1 billion euros worth of assets in the quarter to cover the falling value of gas plants in Austria and France, renewable energy projects, a minority interest in Italian energy group Sorgenia and other interests.
“I cannot 100 percent rule out further writedowns,” Chief Executive Wolfgang Anzengruber told a news conference after the company told shareholders economic conditions had deteriorated even further in the second quarter.
The written-down assets now have a total book value of 484 million euros, of which 200 million are for gas power plants, whose future Anzengruber said the company would decide by the fourth quarter.
Traditional European utilities struggling to compete with heavily subsidised renewable energy sources have begun selling assets amid weak demand from manufacturers and plunging wholesale prices, especially in Germany.
German utility RWE has launched a savings programme to cope with loss-making plants and low wholesale power prices, while smaller rival EnBW’s core profit fell in the first half for the same reasons.
Under political pressure, Verbund also said it would become Austria’s first energy provider to pass on lower wholesale prices to private customers with a 10 percent price cut, and hoped to win new clients with the new offer.
Verbund’s Austrian private customer business accounts for between 5 and 6 percent of the company’s total sales of 3.17 billion euros in 2012.
Revenue rose 9 percent in the second quarter to 788 million euros, thanks to good water supply that allowed it to produce more electricity, beating the average estimate of 772 million euros in a Reuters poll.
Verbund stuck to its 2013 earnings before interest, tax, depreciation and amortisation (EBITDA) forecast of at least 1.15 billion euros and a dividend of 1 euro per share, thanks to proceeds from an asset swap with Germany’s E.ON.
Shares in the company rose 0.2 percent to 15.12 euros by 0901 GMT, against a flat European utilities index.
$1 = 0.7547 euros Reporting by Georgina Prodhan; Editing by Mark Potter and David Holmes