Rwe Ag · XETR:RWE
Rwe — Q1-Q3 2011 Earnings Presentation
33 slides from Rwe's earnings presentation, Nov 10, 2011
Slide 1: Investor and Analyst Conference Call Q1-Q3 2011
Investor and Analyst Conference Call Q1-Q3 2011 Essen, 10 November 2011 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-Q3 operating performance: EBITDA: -21%, operating result -30%, recurrent net income -44%; 2011 earnings outlook confirmed First successful structural changes of long-term gas supply contracts with international oil and gas majors Memorandum of Understanding with Gazprom extended to
Slide 4: RWE Group key performance indicators
RWE Group key performance indicators January – September Change € million 2011 2010 in % External revenue 38,167 38,510 -0.9 Cash flows from operating activities 4,540 4,404 +3.1 EBITDA 6,244 7,914 -21.1 Operating result 4,270 6,129 -30.3 Non-operating result -596 -777 +23.3 Financial result -1,170
Slide 5: Operating Result by Divisions (in € million)
Operating Result by Divisions (in € million) -38% Q1-Q3 2010 Q1-Q3 2011 3,172 1,974 -7% 1,286 -4% 1,202 969 935 +93% -34% +146% +395% 450 - 274 276 233 181 112 99 67 20 -842 Power Sales / NL/B UK CEE/SEE Renewables Upstream Trading/Gas Generation Distribution Gas&Oil Midstream Networks Germany RWE A
Slide 6: Outlook for 2011 – 2013
Outlook for 2011 – 2013 € million EBITDA 10,256 c. -20% c. 9,400 7,681 Operating c. -25% result c. 5,900 3,752 Recurrent c. -35% c. 2,500 net income 2010 2011e 2013e before further disposals Dividend € 3.50/share Pay out ratio of 50% – 60% of recurrent net income The outlook for 2013 includes the di
Slide 7: Back-up
Back-up RWE AG | Q1-Q3 2011 Conference Call | 10 November 2011 7
Slide 8: Performance of the Germany Division (I) Power Generation Business Area (RWE Power)
Performance of the Germany Division (I) Power Generation Business Area (RWE Power) January – September: operating result: -37.8% € million - Lower realised electricity prices and lower volumes (c. -970 million), inter alia, due to new energy policy and shut down of nuclear power plants 3,172 1,974 -
Slide 9: Performance of the Germany Division (II) Sales/Distribution Networks Business Area
Performance of the Germany Division (II) Sales/Distribution Networks Business Area January – September: operating result: -6.5% € million + First-time full consolidation of regional sales and distribution company NVV 1,286 1,202 Sales - Lower gas sales volumes resulting from milder weather condition
Slide 10: Performance of the Netherlands/Belgium Division (Essent)
Performance of the Netherlands/Belgium Division (Essent) January – September: operating result: -33.9% € million - Parts of gas midstream business now reported in Trading/Gas Midstream 274 - Lower electricity generation spreads 181 + Efficiency improvements and synergies 2010 2011 Guidance for fisca
Slide 11: Performance of the United Kingdom Division (RWE npower)
Performance of the United Kingdom Division (RWE npower) January – September: operating result: +146% € million + Cost reductions / efficiency improvements Power generation: + First time contribution from Staythorpe CCGT 276 + Settlement claims of claims relating to major investment projects and lega
Slide 12: Performance of the Central Eastern and South Eastern Europe Division
Performance of the Central Eastern and South Eastern Europe Division January – September: operating result: -3.5% € million 969 935 + Positive f/x effects Czech Republic: - Lower gas sales volumes - Lower income in gas transport business due to increased regulatory pressure - Hungary: Lower electric
Slide 13: Performance of the Renewables Division (RWE Innogy)
Performance of the Renewables Division (RWE Innogy) January – September: operating result: +395% € million 99 + Increased generation volumes (partly driven by improved wind conditions and our growth investments) and improved electricity prices + Liquidated damages associated with the Greater Gabbard
Slide 14: Performance of the Upstream Gas & Oil Division (RWE Dea)
Performance of the Upstream Gas & Oil Division (RWE Dea) January – September: operating result: +93.1% € million 450 + Significantly higher realised oil and gas prices 233 + Higher oil production - Negative f/x effects and lower natural gas production - Increased royalties in Germany as well as cost
Slide 15: Performance of the Trading/Gas Midstream Division (RWE Supply & Trading)
Performance of the Trading/Gas Midstream Division (RWE Supply & Trading) January – September: operating result: n.m.. € million Trading - Negative development partly driven by market disturbance as a result of the events in North Africa and the changed German energy policy 67 Supply - Burdens from l
Slide 16: Non-operating result
Non-operating result January – September Change € million 2011 2010 (absolute) Capital gains 378 17 +361 Impact of commodity derivatives on earnings 50 -793 +843 Restructuring, other -1,024 -1 -1,023 Total -596 -777 +181 Capital gains: Mainly from the sale of Thyssengas, our 24.6% stake in the Rosto
Slide 17: Financial result
Financial result January – September Change € million 2011 2010 (absolute) Net interest -447 -526 +79 Interest accretion to additions to non-current provisions -617 -678 +61 Other financial result -106 -22 -84 Total -1,170 -1,226 +56 Net interest > Release of provisions, among other things Interest
Slide 18: Cash flow statement
Cash flow statement January – September Change € million 2011 2010 (absolute) Funds from operations (FFO) 4,168 5,285 -1,117 Change in working capital 372 -881 +1,253 of which variation margins -884 -814 -70 Cash flow from operating activities 4,540 4,404 +136 Minus capex on fixed assets -4,406 -3,9
Slide 19: RWE Group electricity production (by geographic regions)
RWE Group electricity production (by geographic regions) January – September Other Total Total in TWh Germany UK NL/BE Internat. 2011 2010 Lignite 49.6 4.4 54.0 52.3 Nuclear 27.2 27.2 33.9 Hard coal 24.6 4.8 3.7 0.3 33.2 37.8 thereof contracts 14.8 14.8 16.4 Gas 8.9 16.4 3.7 0.1 29.2 30.0 Renewable
Slide 20: RWE Group electricity sales volume (by geographic regions)
RWE Group electricity sales volume (by geographic regions) January – September Total Total in TWh Germany UK NL/BE Poland Hungary Other 2011 2010 Residential and commercial 18.8 12.6 7.8 2.1 4.1 0.1 45.5 46.5 customers Industrial and corporate 41.7 24.4 12.5 2.6 3.9 0.4 85.5 84.9 customers Distribut
Slide 21: RWE Group gas sales volume (by geographic regions)
RWE Group gas sales volume (by geographic regions) January – September Czech Total Total in TWh Germany Rep. NL UK Other 2011 2010 Residential and commercial 18.0 17.9 25.2 25.8 0.6 87.5 104.1 customers Industrial and corporate 29.9 11.6 39.6 1.8 9.7 92.6 109.5 customers Distributors 43.2 2.3 0.0 0.
Slide 22: 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 2011 forward 90 70 50 30 > 20% > 50% > 70% > 80% > 90% 110 2012 forward 90 70 50 30 > 10% > 25% > 30% > 35% > 50% > 80% > 90% 110 2013 forward 90 70 50 30 > 10% > 30% > 40% 01/01/2009 01/07/2009 01/01/20
Slide 23: Germany: Clean Dark and Spark Spreads (CDS/CSS)
Germany: Clean Dark and Spark Spreads (CDS/CSS) 2010 forward 2011 forward 2012 forward 30 25 Ø 23.55 20 Ø 14.88 15 Ø 12.49 10 Ø 7.11 5 Ø 6.16 Ø 4.66 0 09 10 9 0 1 09 9 10 0 11 1 09 10 11 9 0 1 l- 0 l- 1 l- 1 -0 -0 -1 -1 -1 -1 v- v- n- n- n- p- p- p- ai ai ai rz rz rz Ju Ju Ju No No Ja Ja Ja Se Se Se
Slide 24: UK: Clean Dark and Spark Spreads (CDS/CSS)
UK: Clean Dark and Spark Spreads (CDS/CSS) 2010 forward 2011 forward 2012 forward 20 16 Ø 13.63 Ø 12.80 12 Ø 8.19 8 Ø 7.35 Ø 6.70 Ø 3.63 4 0 09 10 9 0 1 09 9 10 0 11 1 09 10 11 9 0 1 l- 0 l- 1 l- 1 -0 -0 -1 -1 -1 -1 v- v- n- n- n- p- p- p- ai ai ai rz rz rz Ju Ju Ju No No Ja Ja Ja Se Se Se M M M M M
Slide 25: Development of TTF gas price and brent oil price since January 2009
Development of TTF gas price and brent oil price since January 2009 (EUR/MWh) 40 5 2011 30 0 20 -5 10 -10 0 -15 40 5 2012 30 0 20 -5 10 -10 0 -15 Jan 2009 Apr 2009 Jul 2009 Oct 2009 Jan 2010 Apr 2010 Jul 2010 Oct 2010 Jan 2011 Apr 2011 Jul 2011 Oct 2011 Spread Crude Brent (in EUR, normalised to TTF)
Slide 26: Development of net debt
Development of net debt € billion Capex Dividends Acquisitions/ Cash flows Others Change divestiture/ from including in pension, disposals/ operating f/x effects nuclear, (de)consoli- activities mining dation provisions 36 +2.2 34 -0.8 -4.5 32 +4.4 30 -0.1 +0.7 30.9 28 29.0 26 24 0 Net debt Net debt
Slide 27: Financial liabilities and assets
Financial liabilities and assets (excluding hybrid capital, as of 30 September 2011) Financial liabilities Financial assets Split of in billion Euros in billion Euros securities 25 10 15% 20.3 20 8 7.4 4.1 6.8 16.2 1.2 0.8 0.9 1.0 15 0.6 0.5 6 1.6 1.6 10 4 1.2 1.2 14.8 14.8 5 4.1 2 3.0 3.4 3.3 0.2 0
Slide 28: 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 2,5 18 back-up (€ 4.0 bn up to Nov. 2015) 15 € 0.0 bn 2,0 2.0 12 1.5 1,5 Commercial paper 9 $ 3.4 bn ($ 5.0 bn) (up to 1 year)
Slide 29: Capital market debt currency and interest exposure
Capital market debt currency and interest exposure (as of 30 September 2011) 16% 1 28% € 16.6 bn € 17.9 bn2 72% 1 84% € £ Interest rate fixing expiry > 1 year Interest rate fixing expiry < 1 year 1 Capital market debt = bonds of € 14.8 bn and hybrid of € 1.75 bn; split into currencies includes cross
Slide 30: 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 31: RWE Innogy major project portfolio
RWE Innogy major project portfolio € 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 Ost 0.9 (Wind offshore, 295 MW, 100%) Capacity and earnin
Slide 32: RWE Dea's largest field developments
RWE Dea's largest field developments RWE Capex1 Production start share (€ bn) 2011 2012 2013 2014 2015 2016 West Nile Delta (Egypt) 40% 2.6 Breagh (UK) 70% 0.4 Reggane (Algeria) 19.5% 0.4 Luno (Norway) 20% 0.5 Knarr (Norway)2 10% 0.2 NC193 (Libya)3 100% 0.3 NC195 (Libya)3 100% 0.2 1 RWE‘s share in c
Slide 33: 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