Rwe Ag · XETR:RWE
Rwe — Investor Presentation (November 2022)
43 slides from Rwe's investor presentation, November 2022
Slide 1: Growing Green
GROWING GREEN Nov 2022 – Update after 9M reporting
Slide 2: Disclaimer
Disclaimer This document contains forward-looking statements. These statements are based on the current views, expectations, assumptions and information of the management, and are based on information currently available to the management. Forward-looking statements shall not be construed as a promi
Slide 3: Executing Growing Green in 2022
Executing Growing Green in 2022 Nov 2022 Investor presentation
Slide 4: Strong financial and strategic performance drives continuous shareholder value creation
Strong financial and strategic performance drives continuous shareholder value creation Green growth right on track with expansion of Continuous shareholder development pipeline, 1.3 GW of new capacity commissioned in 9M 2022 and further 9.4 GW under value creation construction1 • Almost 90% of cape
Slide 5: Earnings increase in entire core business of RWE Group
Earnings increase in entire core business of RWE Group Adjusted EBITDA, €million Core business Coal/Nuclear 4,127 Substantial investments and steady green capacity expansion Higher capacity utilisation and 2,397 strong operational performance across all generation units of our 3,494 core business 1,
Slide 6: Green transformation accelerated with 2030 coal exit agreement
Green transformation accelerated with 2030 coal exit agreement: Basis for 1.5°C compliant pathway set Agreement reached with federal and state RWE’s government to exit lignite power generation in 2030 in Germany 2030-green Flexible Accelerated closure creates the base for emission portfolio1 Generat
Slide 7: Short-term energy security enhanced by extending existing generation capacity
Short-term energy security enhanced by extending existing generation capacity until winter 23/24 1.3 GW of nuclear capacity: Closure date shifted to Apr 2023 from Dec 2022 1.2 GW Nuclear of lignite capacity: Closure date shifted to Mar 2024 from Dec 20221 Lignite Capacity currently in operation 0.9
Slide 8: Contribution to security of supply through investments in LNG import infrastructure
Contribution to security of supply through investments in LNG import infrastructure FSRU Brunsbüttel (RWE) Capacity: 7.5 bcm1 Expected start of operations: End 2022/Jan 2023 Land-based LNG terminal Brunsbüttel (JV incl. RWE) Capacity: 8.0 bcm Expected start of operations: End of 2026 FSRU Lubmin (RW
Slide 9: Financial exposure to Russian counterparties entirely removed
Financial exposure to Russian counterparties entirely removed and already reflected in H1 earnings • Financial exposure to Russian counterparties fully removed Gas supply contracts actively managed to • No further financial downside from exposure to Russian counterparties as financial mitigate risk
Slide 10: Step up of RWE's footprint in attractive US renewables market
Step up of RWE’s footprint in attractive US renewables market with acquisition of >3 GW Con Edison Clean Energy Businesses With acquisition RWE achieved leading position in Leading US highly attractive US renewables market market position Strong growth outlook for US renewables from from combined ma
Slide 11: Decisive year 2022 – Financial targets upgraded
Decisive year 2022 – Financial targets upgraded Core adj. EBITDA € million Adj. EBITDA RWE Group € million Adj. Net income € million 4,300 – 4,800 2,761 5,000 – 5,500 3,650 2,100 – 2,600 1,569 2022e 2021 2022e 2021 2022e 2021 We have upgraded our financial targets for 2022 We are rigorously executin
Slide 12: Outlook for FY 2022 as of July 2022
Outlook for FY 2022 as of July 2022 Group outlook FY 2022, € million Divisional outlook FY 2022– adj. EBITDA, € million Outlook Core adj. EBITDA (Feb 2022) 4,300 – 4,800 Offshore Wind 1,350 – 1,600 Adj. EBITDA RWE Group 5,000 – 5,500 Onshore Wind/Solar 900 – 1,100 Depreciation ~-1,600 Hydro/Biomass/
Slide 13: 9M 2022 results
9M 2022 results Nov 2022 Investor presentation Page 13
Slide 14: Delivery of green growth fast tracked with capacity additions of 9.4 GW underway
Delivery of green growth fast tracked with capacity additions of 9.4 GW underway Development of our green generation portfolio, GW pro rata +9.4 37.4 1.9 0.7 <0.1 3.9 Includes 1.4 GW from Magnum 1.1 acquisition 28.0 1.7 26.9 1.3 0.1 Includes 3.1 GW2 from CEB acquisition 31 Dec Capacity Capacity 30 3
Slide 15: Strong performance in the core business while previous year was marked by a negative one-off
Strong performance in the core business while previous year was marked by a negative one-off Core adj. EBITDA 9M 2022 vs. 9M 2021, € million Offshore Wind earnings up on the back of +108% capacity additions including Rampion consolidation effect, better wind conditions and 3,494 higher power prices
Slide 16: Strong adj. net income on the back of the successful operational performance
Strong adj. net income on the back of the successful operational performance Adj. net income, € million Adj. EBITDA driven by strong operational performance 9M 2021 9M 2022 Adj. EBITDA Adj. depreciation increases in line with 2,397 4,127 9M 2022 growth investments -1,058 Adj. depreciation -1,162 Adj
Slide 17: Economic net debt
Economic net debt Net assets / net debt (€ million) 30 Sep 2022 31 Dec 2021 +/- Net debt definition Cash and cash equivalents 3,307 5,825 -2,518 • Net debt does not Marketable securities 4,531 8,347 -3,816 contain mining provisions, which Other financial assets 25,000 12,403 12,597 essentially cover
Slide 18: Strategy & Long-term financial outlook
Strategy & Long-term financial outlook Extract from Capital Market Day – Nov 2021 Nov 2022 Investor presentation
Slide 19: Leading the way to a green energy world
Leading the way to a green energy world Nov 2022 Investor presentation
Slide 20: Growing Green: Leading the way to a green energy world
Growing Green: Leading the way to a green energy world RWE is perfectly positioned: vast experience in green technologies, strong market presence in industrial growth markets, operating a leading commercial platform We significantly accelerate our green growth programme: €50bn gross / €30bn net cash
Slide 21: The future energy market is powered by green technologies
The future energy market is powered by green technologies Nov 2022 Investor presentation Page 21
Slide 22: Our core business is leading the way to a green energy world
Our core business is leading the way to a green energy world Offshore Onshore Batteries & Hydrogen Commercial Wind Wind/Solar Flexible Solutions Generation Strongest growth in Biden Plan and RWE’s European Hydrogen is quickly Decarbonisation Europe, significant European Green core markets require ga
Slide 23: Perfectly positioned to succeed
Perfectly positioned to succeed Long-term Strong market Leading experience presence in commercial in relevant industrial platform to technologies countries with maximise at scale high growth value potential Nov 2022 Investor presentation Page 23
Slide 24: Raising the bar to accelerate the energy transition
Raising the bar to accelerate the energy transition Wind/Solar/Batteries Flexible Generation Hydrogen 2.5 GW per year Significant 1.5 GW growth in net per year capacity additions Ø GW per year, 2.1 pro rata 0.2 0.2 Ambition CMD 2020 Ambition CMD 2021 for 2019 – 2022 for 2021 – 2030 Nov 2022 Investor
Slide 25: €50bn gross investment programme to drive green growth
€50bn gross investment programme to drive green growth Green investment programme 2021 – 2030 ~€50bn +35 GW ~€30bn +25 GW Gross cash Net cash investments investments Nov 2022 Investor presentation Note: Capacity additions before decommissioning. Page 25
Slide 26: Powerful & green in 2030: Leading green energy company
Powerful & green in 2030: Leading green energy company 50 GW >95% 9% €5bn Green installed EBITDA from Annual average EBITDA net capacity in core business EBITDA growth Ambition 2030 as of 2023 in core business 2030 2021 – 2030 Nov 2022 Investor presentation Page 26
Slide 27: Sustainability is at the heart of our strategy
Sustainability is at the heart of our strategy Reduction of carbon emissions Enhancement of biodiversity compared to 2012 by closing Recultivated over 23,000ha in the Rhenish down of coal-fired power generation mining area. With over 1,500 plants and 3,100 capacity, RWE targets in line with Paris cl
Slide 28: Stepping up our ambition in sustainability
Stepping up our ambition in sustainability Climate Change Biodiversity & Recultivation Environ- mental We will be climate neutral by 2040 . Because we care about the biodiversity impact Our ambitions of our business, we commit to the highest On the way there, our ambition is to reduce standards in r
Slide 29: Strong growth platform across all technologies
Strong growth platform across all technologies Secured offshore rights Powerful development pipeline of Europe green generation technologies 4.3 >55 GW 1.2 8 GW 8 1.6 0.8 0.4 0.5 11 GW 0.4 1.6 14 7.7 Additional offshore pipeline from 10 central tenders/lease auctions Americas 4 10 2.8 Expected 5.8 +
Slide 30: Our offshore installed net capacity will triple by 2030
Offshore wind Our offshore installed net capacity will triple by 2030 Our offshore wind target, installed Growth until 2027 secured >3x 8 net capacity GW, pro rata 5 2.4 2020 2027e 2030e Good visibility Triton Knoll, 0.5 GW Sofia, 1.4 GW Secured rights >7 GW on capacity Kaskasi, 0.3 GW Baltic 2, 0.4
Slide 31: Ambitious onshore wind targets and steep solar growth
Onshore wind and solar Ambitious onshore wind targets and steep solar growth Our onshore wind and solar target, Solar Onshore wind installed net capacity GW, pro rata 20 GW 16 GW 8 Capacity 6 growth in 7 GW onshore wind and solar <1 12 10 7 2020 2027e 2030e Nov 2022 Investor presentation Page 31
Slide 32: Balancing the system is a growth opportunity
Batteries & flexible generation Balancing the system is a growth opportunity 3 Our battery 2 Growth focus in & flexible <1 batteries is on co- Batteries location with wind generation 2020 2027e 2030e capacity, and solar sites installed net 17 16 17 Excellent position to 1 2 capacity build new gas pl
Slide 33: Ideally positioned for the hydrogen economy
Hydrogen Ideally positioned for the hydrogen economy Hydrogen market growth Strongest global growth Strong expertise along the value chain momentum in Europe Industrial demand centres located in RWE’s European core markets Renewable Logistics European energy (storage & transport) electrolyser capaci
Slide 34: Growth target backed by strong project pipeline
Hydrogen Growth target backed by strong project pipeline RWE’s hydrogen development pipeline RWE with market leading growth target in electrolyser capacity 10 GW Mostly early-stage pro rata development projects Requirements for electrolyser investments +2 • Regulatory and political Selected hydrogen
Slide 35: Delivering growth and value
Delivering growth and value Nov 2022 Investor presentation
Slide 36: We accelerate our growth investments to €3bn net annually
We accelerate our growth investments to €3bn net annually Share of gross cash investments: Ø €5bn p.a. Offshore wind + 20 Green investment Ø €3bn p.a. Onshore wind, solar and batteries programme 2021 – 2030 50 >90% 2021 – 2027 EU Taxonomy €bn + €21bn eligible 30 Flexible generation & hydrogen Gross
Slide 37: Stable and sustainable earnings profile
Stable and sustainable earnings profile Gross margin Gross margin split Gross margin split Wind/Solar Flexible generation 2021 – 2023 PPAs/Tax Credit Capacity payments/ Merchant 10% ancillary services 25% 12 30% Merchant 35% years 30% Certificates Weighted average remaining support 30% 40% tenor1 Wi
Slide 38: Investment programme funded by strong cash flow and balance sheet
Investment programme funded by strong cash flow and balance sheet Funding 63 63 composition 2021 – 2030 20 Asset rotation €bn Financial Gross cash 50 11 headroom investments Net cash investments of €30bn Adj. operating 32 cash flow Dividend 7 Utilisation of nuclear/ 6 mining provisions Sources of fu
Slide 39: Committed to strong capital structure and investment grade rating
Committed to strong capital structure and investment grade rating Strong investment Target leverage factor of grade rating Today ≤3x net debt/core adj. EBITDA Current & Target rating: Baa2 BBB+ Post 2025 ≤3.5x Target leverage factor of net debt/adj. EBITDA Nov 2022 Investor presentation Page 39
Slide 40: Sustainable financing provides liquidity and financing at competitive rates
Sustainable financing provides liquidity and financing at competitive rates Successfully issued Syndicated credit facility with Green Bond in Q2 2021 sustainability-linked KPIs • Green bond multiple times oversubscribed • Renewable energy (%) in generation portfolio • Ten-year bond at highly attract
Slide 41: Attractive and stable dividend throughout the green energy transition
Attractive and stable dividend throughout the green energy transition Dividend Dividend floor of policy €0.90 per share €/share growing Long-term average stable pay-out ratio of 50 – 60% based on adj. net income 0.85 0.90 0.80 2019 2020 2021 2030 Nov 2022 Investor presentation Page 41
Slide 42: Delivering growth and value
Delivering growth and value Green Earnings Strict Dividend investments Growth balance sheet commitment 2021 – 2030 2021 – 2030 management Strong investment Floor of €0.90 €30bn grade rating per share Net cash investments 9% Long-term target Long-term >90% EBITDA CAGR leverage factor payout ratio of
Slide 43: Your contacts in Investor Relations
Your contacts in Investor Relations Important Links Financial Calendar • Annual and interim reports & statements • 21 March 2023 ADR programme available Annual report for fiscal 2022 • Investor and analyst conferences • 04 May 2023 Further information on our homepage Annual General Meeting • IR pres