In millions of euros First half of 2019 First half of 2018
     
Revenues 683 671
Total expenses ‑374 ‑385
     
Operating result 309 287
Financial income and expenses ‑38 ‑34
Share in result of joint ventures and associates, and dividends from other equity interests 54 48
     
     
Result before taxation 325 300
Taxes ‑71 ‑66
     
Result after taxation 254 234

Revenues

Revenues achieved in the first half of the year were approximately € 12 million more as in the same period last year. This increase is largely due to BBL Company due to higher capacity sales. Revenues from our regulated activities in the Netherlands are € 6 million less than in the first half of 2018. Although the tariffs have risen, the capacity sold has fallen by around € 9 million. Revenues from regulated activities in Germany are € 10 million higher. This is the result of an increase in capacity bookings.
The method of regulation in both the Netherlands and Germany includes various regular ‘post-calculations’. Where the actual revenues deviate from the permitted revenues, the difference is settled in the tariffs for subsequent years. A post-calculation mechanism also applies to part of the energy costs for gas transport. In the 2019 revenue rates, GTS will make a repayment of € 6 million, and Gasunie Deutschland will receive a repayment of € 19 million. Based on the current financial outlook for the entire year 2018, Gasunie will receive a net repayment of approximately € 30 million in future rates (2020 and beyond) under the regulatory system.

Operating result

The operating result for the first half of 2019 rose by € 22 million compared to the same period in 2018. In addition to the increase in revenues, operating costs are € 13 million lower. This is largely the result of the voluntary severance scheme, in which 240 employees left Gasunie in the first half of 2019.

Result after taxation

The financial income and expenses were € 4 million more than in the first half of 2018, due to largely higher interest charges on the bond loans.
The share in the result of joint ventures and associates, and dividends from other equity interests increased by € 6 million due to a higher dividend distribution by Nord Stream. The developments above lead to a result after taxation of € 254 million, which is € 20 million more than in the same period last year.

Financial outlook

The result for 2019 as a whole is expected to be higher as the result for 2018. In the second half of 2018, a provision was recorded for the voluntary severance scheme and employee benefit schemes. In addition, the result for 2018 includes the positive effect of the future adjustment of CIT-rates. In 2019, the result after taxation from continuing operations is expected to be approximately € 370 to € 400 million.

Expenses for replacement and expansion investments for all of 2019 are expected to total approximately € 450 to € 500 million. These costs are therefore approximately € 80 million higher than in 2018.  The main reasons for this increase are the long-term investments in the EUGAL pipeline project and the planned construction of the new nitrogen plant. Due to risk-based asset management, the costs for replacement investments are expected to be approximately € 50 million lower than in 2018.

Financing

We did not issue bonds in the first half of 2019. However, we have raised short-term loans on the money market in the form of private loans and Euro Commercial Paper (ECP). No use was made of the € 680 million stand-by facility. A bond loan of € 300 million must be repaid in November 2019.

Credit ratings

Our long-term credit rating at Moody’s Investors Service remains A1 with a stable outlook. Our short-term rating at Moody’s remains P-1. We also have a credit rating at Standard & Poor’s Global Ratings. Our long-term credit rating at S&P Global remains AA- with a stable outlook. Our short-term rating is A-1+.