Essen, 11 November 2008This pressinformation is more than two years old

RWE increases its operating result by 5% in the first three quarters of 2008

  • Recurrent net income 20% above prior year
  • Investments to be carried out according to plan
  • Forecast for fiscal 2008 confirmed
  • Dividend payout ratio for 2008 raised to 70 to 80%
  • Workforce grows by 3%

RWE has reconfirmed its forecast for fiscal 2008. The Group is planning to pay a dividend of 70 to 80% of recurrent net income for fiscal 2008, up from the previous level of 50 to 60%. The first three quarters show a stable, positive trend, with the operating result up by 5% and recurrent net income rising by 20%.

Energy sales up year on year

In the first nine months of the year, RWE supplied 236 billion kWh of electricity, or 3% more than in the same period last year. The company saw a net gain in customer numbers in Germany in the third quarter. In mid-November, RWE will launch a new, practically zero-emission electricity product called "RWE ProKlima Strom 2011" ("RWE ProClimate Power 2011"). A total of 32% of the electricity for the new product will be generated from renewables and 68% from German nuclear power plants.

External revenue 14% higher

The RWE Group generated external revenue of Euro 34.5 billion in the first three quarters of 2008. This represents a rise of 14% year on year. Adjusted for consolidation and currency effects, revenue rose by 16%.

Operating result improves by 5%

The operating result increased by 5% to Euro 5.8 billion. The growth in earnings stemmed primarily from the German power generation business. Contributing to the increase was the fact that the Biblis nuclear power plant came back online. The Group posted a successful third quarter in its energy trading business. The reduced allocation of emissions allowances for power generation along with grid fee cuts by the German regulatory authorities had a negative effect.

Recurrent net income up 20% compared to prior-year level

Recurrent net income increased to Euro 3.1 billion. This represents a 20% gain on the same period last year.

Enhanced efficiency programme on track

RWE's programme for enhancing efficiency is progressing according to plan. Associated measures are designed to raise revenue and reduce costs in order to gradually improve earnings by Euro 1.2 billion by the end of 2012. The company is confident that it will achieve its target of a Euro 100 million impact on earnings in the current year.

Capital expenditure up by 37% year on year

The RWE Group invested Euro 3.4 billion in the first three quarters of 2008. This is 37% higher than the prior-year figure, which still included American Water. Capital expenditure on property, plant and equipment totalled Euro 2.5 billion, or 5% more than was spent in the same period last year. Net of American Water, this represents a 27% increase.

RWE acquires share in UK offshore wind farm

In early November, RWE took a 50% stake in the construction and operation of the Greater Gabbard wind farm off the south-eastern coast of the UK. The total investment for RWE and its project partner, Scottish and Southern Energy, is GBP 1.3 billion. The wind farm is expected to operate 140 turbines with a total capacity of 509 MW by 2011, making it one of the largest such facilities in Europe.

Solid financial position - financial crisis has minimal impact

RWE is only affected to a limited extent by the current financial market crisis. The capital market recognises the company’s high credit rating, based on its solid financial position. RWE has strong cash flows from operating activities and substantial liquid funds.

Workforce increases by 3%

As at 30 September 2008, the RWE Group employed 65,440 staff, 60% of whom worked in Germany. Compared with year-end 2007, the number of employees thus rose by 2,000, or 3.2%. RWE Power in particular created new jobs as part of its power plant investment programme, and RWE npower increased the number of its sales and customer service employees.

Research and development focus on emissions reduction and electro-mobility

In the first three quarters of 2008, RWE spent Euro 58 million on research and development. Enhancing efficiency and reducing emissions from fossil-fuel-fired power stations were the focus of these R&D measures. RWE is collaborating in this field with partners in the plant engineering sector and the chemical industry. In September, RWE and Daimler launched a joint initiative to develop and test an everyday mobility concept for electric cars in Berlin.

Outlook 2008

The RWE Group expects to increase external revenue in fiscal 2008 by more than 10% above last year’s level. The company still anticipates that the operating result will at least match the level achieved in 2007. RWE also confirms its forecast of a rise in recurrent net income by more than 10%. Recurrent net income is the basis for calculating the dividend.

Forward-looking statements

This press release 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 assessments 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 accuracy of these statements.

Additional information as Download:
At a glance (spreadsheet)
Report on the first three quarters of fiscal 2008 (PDF-file)
Investor conference call charts presented by Dr. Rolf Pohlig, CFO of RWE AG (PDF-file)
Speech of the Conference call for journalists by Dr. Rolf Pohlig, CFO of RWE AG (PDF-file)

Please contact our Investor Relations Team with any questions that you may have:

RWE Aktiengesellschaft
Investor Relations
Altenessener Straße 27
45141 Essen

T +49 (0) 201-5179-3112
RWE Aktiengesellschaft
Investor Relations
London Office
c/o RWE Supply & Trading
60 Threadneedle Street
London EC2R 8HP
United Kingdom
T +44 (0) 20 7015 5459
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