Rwe Ag · XETR:RWE
Rwe — Q1 2012 Earnings Presentation
34 slides from Rwe's earnings presentation, May 10, 2012
Slide 1: Investor and Analyst Conference Call Q1 2012
Investor and Analyst Conference Call Q1 2012 Essen, 10 May 2012 Rolf Pohlig Stephan Lowis Chief Financial Vice President Officer Investor Relations
Slide 2: Forward Looking Statement
Forward Looking Statement This presentation contains certain forward-looking statements within the meaning of the US federal securities laws. Especially all of the following statements: Projections of revenues, income, earnings per share, capital expenditures, dividends, capital structure or other
Slide 3: Main messages
Main messages Q1 2012 operating performance: EBITDA: -9%, operating result -14%, recurrent net income -20% Further successful structural changes of long-term gas supply contracts with international oil and gas majors; focus now on remaining three major gas suppliers Successful hybrid bonds issuance
Slide 4: RWE Group key performance indicators
RWE Group key performance indicators January – March Change € million 2012 2011 in % External revenue 15,593 15,754 -1.0 Cash flows from operating activities 298 2,284 -87.0 EBITDA 3,125 3,426 -8.8 Operating result 2,436 2,827 -13.8 Non-operating result 13 209 -93.8 Financial result -470 -372 -26.3
Slide 5: RWE's gas procurement portfolio
RWE’s gas procurement portfolio (as of April 2012) Long-term oil-indexed purchase contracts (take-or-pay) Own production 39% Russia NBP 32% Norway ~45 bcm ~19 bcm p.a. p.a. TTF or similar 8% Germany 21% Netherlands > Our gas procurement portfolio is managed by RWE Supply & Trading > ~42% or 19 bcm p
Slide 6: RWE's long-term oil-indexed gas purchase portfolio
RWE’s long-term oil-indexed gas purchase portfolio bcm p.a. RWE’s long-term oil-indexed gas purchase portfolio at the end of the relevant year 30 Already achieved reduction of the oil-indexed share of RWE’s gas purchase portfolio 25 20 15 contract reviews initiated 2011 10 5 contract reviews initiat
Slide 7: Operating Result by Division (in € million)
Operating Result by Division (in € million) -12% 1,201 Q1 2011 Q1 2012 1,057 +2% 595 607 -29% -28% 444 409 321 +37% 291 +4% 241 +24% 176 145 151 +20% 68 84 -220 -276 Power Sales / NL/B UK CEE/SEE Renewables Upstream Trading/Gas Generation Distribution Gas&Oil Midstream Networks Germany RWE AG | Q1 2
Slide 8: Divisional outlook for the operating result
Divisional outlook for the operating result € million 2011 actual 2012 forecast vs. 2011 Germany 4,205 Above last year Power Generation 2,700 Above last year Sales/Distribution networks 1,505 In the order of last year’s level Netherlands/Belgium 245 Significantly below last year United Kingdom 357 A
Slide 9: Outlook for 2012 – 2013
Outlook for 2012 – 2013 € million ~9,000 EBITDA 8,460 in the order of 2011 Operating 5,814 in the order of 2011 in the order of 2011 result Recurrent 2,479 in the order of 2011 in the order of 2011 net income 2011 2012e 2013e after further disposals1 after further disposals1 Dividend € 2.00/share Pa
Slide 10: Back-up Charts
Back-up Charts RWE AG | Q1 2012 Conference Call | 10 May 2012 10
Slide 11: Performance of the Germany Division (I) Power Generation
Performance of the Germany Division (I) Power Generation Business Area (RWE Power) January – March: operating result: -12.0% € million - Lower realised electricity prices and lower volumes (c. -€50m), (including positive effects from the trial run of the new lignite-fired power plant 1,201 BoA 2&3)
Slide 12: Forward selling by RWE Power in the German market
Forward selling1 by RWE Power in the German market (Base-load & peak-load forwards in €/MWh) 110 2012 forward 90 70 50 30 > 30% > 35% > 50% > 80% > 90% 2013 forward > 10% > 30% > 50% > 60% 2014 forward > 20% > 30% 01/01/2010 01/07/2010 01/01/2011 01/07/2011 01/01/2012 01/07/2012 01/01/2013 Peak-load
Slide 13: Germany: Clean Dark and Spark Spreads (CDS/CSS)
Germany: Clean Dark and Spark Spreads (CDS/CSS) 2011 forward 2012 forward 2013 forward 25 20 15 Ø 14.88 10 Ø 7.74 Ø 9.48 5 Ø 6.16 Ø 4.93 Ø 0.61 0 -5 Trading year 2010 Trading year 2011 Trading year 2012 0 1 2 0 1 2 0 1 2 0 1 2 -1 -1 -1 r-1 r-1 r-1 l- 1 l- 1 l- 1 1 1 1 n- n- n- kt kt kt Ju Ju Ju Ap A
Slide 14: Performance of the Germany Division (II) Sales/Distribution Networks
Performance of the Germany Division (II) Sales/Distribution Networks Business Area January – March: operating result: +2.0 % € million Sales - Slightly lower margins in electricity and gas sales 595 607 Distribution networks + Improved cost cutting in our German business + Income from sale of distri
Slide 15: Performance of the Netherlands/Belgium Division (Essent)
Performance of the Netherlands/Belgium Division (Essent) January – March: operating result: +4.1% € million + Improved margins in the sales business due to cost cutting and effective pricing strategy 145 151 - Lower electricity generation spreads + Commissioning of new gas-fired power plants Claus C
Slide 16: Performance of the United Kingdom Division (RWE npower)
Performance of the United Kingdom Division (RWE npower) January – March: operating result: -28.9% € million - Absence of non-recurrent item relating to settlement of claims in 2011 Power generation 409 - Significantly lower margins 291 - Fire at biomass power plant in Tilbury Retail + Improved commo
Slide 17: UK: Clean Dark and Spark Spreads (CDS/CSS)
UK: Clean Dark and Spark Spreads (CDS/CSS) 2011 forward 2012 forward 2013 forward 28 24 Ø 19.68 20 16 Ø 13.78 12 Ø 8.19 8 Ø 3.55 Ø 3.39 4 Ø 6.70 0 Trading year 2010 Trading year 2011 Trading year 2012 0 1 2 0 1 2 0 1 2 0 1 2 -1 -1 -1 r-1 r-1 r-1 l- 1 l- 1 l- 1 1 1 1 n- n- n- kt kt kt Ju Ju Ju Ap Ap
Slide 18: Performance of the Central Eastern and South Eastern Europe Division
Performance of the Central Eastern and South Eastern Europe Division January – March: operating result: -27.7% € million - Negative f/x-effects 444 Czech Republic: 321 - Lower gas distribution margins Hungary: - Lower electricity generation and retail margins 2011 2012 Guidance for fiscal year 2012:
Slide 19: Performance of the Renewables Division (RWE Innogy)
Performance of the Renewables Division (RWE Innogy) January – March: operating result: +23.5% € million 84 + Increased generation volumes (partly driven by improved wind conditions and growth investments) and improved electricity wholesale 68 prices + Earnings contribution from wood pellet plant at
Slide 20: Performance of the Upstream Gas & Oil Division (RWE Dea)
Performance of the Upstream Gas & Oil Division (RWE Dea) January – March: operating result: +36.9% € million + Higher realised oil and gas prices 241 176 + Positive f/x effects - Lower natural gas production 2011 2012 Guidance for fiscal year 2012: significantly above last year € million + Higher oi
Slide 21: Performance of the Trading/Gas Midstream Division
Performance of the Trading/Gas Midstream Division (RWE Supply & Trading) January – March: operating result: +20.3% € million Trading + Improved performance in the energy trading business Supply - Burdens from long-term oil-indexed gas contracts -276 -220 + Compensation from a commercial settlement 2
Slide 22: Development of TTF gas price and brent oil price
Development of TTF gas price and brent oil price Forward for delivery Forward for delivery Forward for delivery Forward for delivery in 2010 in 2011 in 2012 in 2013 €/MWh €/MWh 45 70 40 60 35 50 30 40 25 30 20 20 15 10 10 0 5 -10 0 -20 Trading year 2009 Trading year 2010 Trading year 2011 Trading ye
Slide 23: Cash flow statement
Cash flow statement January – March Change € million 2012 2011 (absolute) Funds from operations (FFO) 2,277 3,071 -794 Change in working capital -1,979 -787 -1,192 of which variation margins 42 -177 219 Cash flows from operating activities 298 2,284 -1,986 Minus capex on fixed assets -987 -1,144 157
Slide 24: RWE Group electricity production (by geographic regions)
RWE Group electricity production (by geographic regions) January – March Other Total Total in TWh Germany UK NL/BE Internat. 2012 2011 Lignite 21.0 1.3 22.3 19.0 Nuclear 8.4 8.4 12.2 Hard coal 8.9 5.2 1.9 0.1 16.1 14.9 thereof contracts 5.5 5.5 5.5 Gas 2.5 5.1 1.8 0.1 9.5 11.3 Renewables 1.3 1.1 0.6
Slide 25: RWE Group electricity sales volume (by geographic regions)
RWE Group electricity sales volume (by geographic regions) January – March Total Total in TWh Germany UK NL/BE Poland Hungary Other 2012 2011 Residential and commercial 7.8 5.2 3.1 0.7 1.5 18.3 18.41 customers Industrial and corporate 13.8 8.4 3.9 0.9 1.2 0.3 28.5 26.81 customers Distributors 20.0 1
Slide 26: RWE Group gas sales volume (by geographic regions)
RWE Group gas sales volume (by geographic regions) January – March Czech Total Total in TWh Germany Rep. NL UK Other 2012 2011 Residential and commercial 12.9 9.8 16.0 16.3 1.2 56.2 60.7 customers Industrial and corporate 9.0 6.3 15.4 0.8 3.9 35.4 41.3 customers Distributors1 15.7 5.9 0.0 0.0 0.4 22
Slide 27: Development of net debt
Development of net debt € billion Capex Dividends Acquisitions/ Cash flows Others Change Hybrid divestiture/ from including in pension, disposals/ operating f/x effects nuclear, (de)consoli- activities mining dation provisions 36 +1.0 +0.1 +0.8 32 30.8 29.9 -0.1 -0.3 -0.4 -0.2 28 24 0 Net debt Net d
Slide 28: Financial liabilities and assets
Financial liabilities and assets (excluding hybrid capital, as of 31 March 2012) Financial liabilities Financial assets Split of in billion Euros in billion Euros securities 25 10 15.2% 19.9 8.1 20 8 7.4 2.2 1.1 1.5 0.8 15.9 0.9 1.7 15 0.3 6 1.7 1.1 0.9 0.9 10 4 15.9 13.9 4.0 2 4.0 4.4 5 0.4 1.3 0.3
Slide 29: Capital market debt maturities and sources of financing
Capital market debt maturities and sources of financing Capital market debt maturities1 Strong sources of financing in € bn Fully committed for liquidity syndicated loan 2,5 20 back-up (€ 4.0 bn up to Nov. 2015) € 0.0 bn 2,0 16 1,5 12 Commercial paper $ 0.6 bn ($ 5.0 bn) (up to 1 year) 1,0 8 € 0.5 b
Slide 30: Capital market debt currency and interest exposure
Capital market debt currency and interest exposure (as of 31.03.2012) 14% 34% 1 € 18.9 bn € 18.9 bn2 66% 86% € £ Interest rate fixing expiry > 1 year Interest rate fixing expiry < 1 year 1 Capital market debt = bonds of € 15.7 bn and hybrids of € 3.2 bn; split into currencies includes cross-currency
Slide 31: Conventional power plant new build programme
Conventional power plant new build programme € bn1 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Lingen 0.5 (Gas, 876 MW, 100%) BoA 2&3, Neurath 2.6 Units G F (Lignite, 2,100 MW, 100%) Hamm 2.4 Units D E (Hard coal, 1,528 MW, 77%) Staythorpe 0.8 Units 1 -4 (Gas, 1,650 MW, 100%) Pembroke 1.2 Unit
Slide 32: RWE Dea's largest field developments
RWE Dea's largest field developments 1 RWE Capex Production start share (€ bn) 2011 2012 2013 2014 2015 2016 2017 2018 West Nile Delta NA 40% 2.8 (Egypt) WMDW 20% 100% Disouq (Egypt) 0.1 (Operator) 70% Breagh Phase 1 (GB) 0.4 (Operator) Reggane (Algeria) 19,5% 0.4 Edvard Grieg (Norway)2 20% 0.7 3 Kn
Slide 33: RWE Innogy major projects under construction
RWE Innogy major projects under construction € bn1 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Gwynt y Môr 2.4 (Wind offshore, 576 MW, 60%) Greater Gabbard 1.9 (Wind offshore, 504 MW, 50%) Markinch (Biomass CHP, 0.3 45 MWe, 88 MWth, 100%) Nordsee Ost2 0.9 (Wind offshore, 295 MW, 100%) Capacity
Slide 34: Always be informed about RWE…
Always be informed about RWE… To always be up-to-date, please have a look at our website www.rwe.com/ir Calendar http://www.rwe.com/web/cms/en/110614/rwe/investor-relations/calendar/ Annual and Interim Reports http://www.rwe.com/web/cms/en/110822/rwe/investor-relations/financial-reports/ Resul