RWE Eemshaven plant, 2017 file photo. Zandcee / CC BY-SA 4.0; cropped.
German energy group RWE reported a 35% rise in nine-month adjusted EBITDA to €4.6 billion Wednesday, helped by stronger trading, better European wind conditions and new generating assets. The Essen-based company kept its full-year earnings forecast unchanged but said results should come in toward the upper end of its ranges.
Adjusted net income rose to €1.846 billion from €1.293 billion a year earlier, while adjusted earnings per share increased to €2.52 from €1.77, RWE said in its results announcement and interim statement. Adjusted EBITDA, an earnings measure before interest, taxes, depreciation and amortisation, was €4.575 billion, compared with €3.398 billion. The company has restated some prior-year figures.
The adjusted figures differ sharply from RWE’s reported bottom line. It recorded a net loss attributable to shareholders of €150 million, against a €2.3 billion profit a year earlier. RWE said temporary losses from valuing derivatives were a major reason for the decline. Such accounting effects can arise when hedges are valued at current market prices before the transactions they protect are reflected in earnings.
The strongest rebound came in Supply & Trading. Its adjusted EBITDA reached €543 million, up from €150 million after a weak start to the year. RWE now expects that segment to exceed its previous full-year range of €100 million to €500 million, even as the group’s overall forecast stays in place.
RWE continues to expect full-year adjusted EBITDA of €5.75 billion to €6.35 billion and adjusted net income of €1.95 billion to €2.45 billion. It also reaffirmed a 2026 dividend target of €1.32 a share.
All operating segments increased their earnings contributions. Offshore Wind benefited from better wind conditions and initial generation at projects still under construction. New capacity helped Onshore Wind/Solar, while Flexible Generation gained from higher UK margins and capacity payments and compensation from the Dutch state for earlier restrictions on coal-fired generation at the Eemshaven plant.
The company invested €10.7 billion net during the first nine months. It said it had commissioned 838 megawatts of new capacity since the start of the year and had another 13.5 gigawatts under construction.
Net debt stood at €17 billion at the end of September. RWE expects it to fall to about €12 billion by year-end, mainly because the Vanguard West and Vanguard East offshore wind projects will leave its consolidated accounts following the creation of its joint venture with KKR. As JBizNews reported, the partners have closed financing for the two UK projects. RWE expects its year-end ratio of net debt to adjusted EBITDA to remain below its 3.0-times target.
JBizNews Desk | Essen
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