Outlook
Stable earnings trend expected
Despite divestments, we anticipate that earnings will be stable in 2012. Positive stimulus is expected to come from an increase in oil and gas production at RWE Dea. Furthermore, we will benefit from the commissioning of new generation capacity, with the dual-block lignite-fired power plant at Neurath near Cologne leading the way. This will be contrasted by mounting burdens caused by the German nuclear fuel tax. In the gas midstream business, in some cases, we still have to pay much more for gas purchases based on oil price-indexed contracts in 2012 than we can realise when selling it on. This will result in further negative effects on earnings. Most of the contract renegotiations with our gas suppliers will probably not provide relief until 2013. In 2012, the RWE Group’s EBITDA and operating result are expected to be comparable to 2011. We also anticipate that recurrent net income will be in the order of last year’s level. The outlook considers the effects of the ongoing divestment programme.
Dividend remains attractive
We will maintain our payout ratio of 50 % to 60 % over the medium term. This means that we still want to pay out at least half of our recurrent net income to our shareholders. RWE will therefore continue to pay an attractive dividend.
Capex of €6 billion planned
Our capital expenditure on property, plant and equipment in 2012 will total approximately €6 billion. This would be slightly below the record levels achieved in the two previous years (€6.4 billion). The reason is the gradual completion of facilities as we implement our power plant new-build programme. However, we anticipate spending more on expanding renewable capacity than in 2011. We also want to step up capital expenditure on our upstream gas and oil activities.
Earnings forecast for 2013
The earnings prospects for 2013 are favourable, although we will face additional burdens in the field of electricity generation. These will result from the fact that our power stations will stop receiving free allocations of CO2 emission allowances from 2013 onwards. However, this will be contrasted by the positive effects of the new efficiency-enhancement programme, which should total an estimated €750 million. In addition, we expect to be able to conclude most of the ongoing renegotiations with RWE Supply & Trading’s gas suppliers and that they will lead to substantial relief. We want to have completed our divestment programme by the end of 2013. This will eliminate the earnings contributed by the disposed assets. Nevertheless, we anticipate that our operating result and recurrent net income will be of the order achieved in 2011. EBITDA will probably improve: we expect it to total about €9 billion in 2013.
Forward-looking statements
This page contains forward-looking statements regarding the future development of the RWE Group and its companies as well as economic and political developments. These statements are asessments that we have made based on information available to us at the time this document was prepared. In the event that the underlying assumptions do not materialise or additional risks arise, actual performance can deviate from the performance expected at present. Therefore, we cannot assume responsibility for the correctness of these statements.