Rwe Ag · XETR:RWE
Rwe — Q1 2009 Earnings Presentation
30 slides from Rwe's earnings presentation, May 14, 2009
Slide 1: Investor and Analyst Conference Call Q1 2009
Investor and Analyst Conference Call Q1 2009 Essen, May 14, 2009 Rolf Pohlig Chief Financial Officer Ingo Alphéus Vice President 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: Key messages
Key messages Performance ¾ Operating result increased 5.0% Q1 2009 ¾ Recurrent net income up by 5.9% Strategy ¾ Recommended bid for Dutch utility Essent ¾ Successful bid for nuclear sites in UK within NDA auction process ¾ Step into the Turkish electricity market ¾ Reorganization of Group structure
Slide 4: RWE Group key performance indicators
RWE Group key performance indicators January – March change € million 2009 2008 in % External revenue 14,516 13,395 +8.4 Cash flows from operating activities 533 1,384 -61.5 EBITDA 3,090 2,951 +4.7 Operating result 2,624 2,499 +5.0 Non-operating result 424 15 - Financial result -510 -301 -69.4 Incom
Slide 5: Performance of RWE Power
Performance of RWE Power Q1 operating result: +1.4% + Higher realised electricity prices and lower volumes € million (+€280 million) including margin impact from Biblis outage (-€150 million) 1,062 1,077 Increased costs due to higher fuel prices (-€210 million) + Slightly lower costs for CO2 certifi
Slide 6: Our hedging strategy protects us from short-term impacts of the recession
Our hedging strategy protects us from short-term impacts of the recession Forward selling of RWE Power in the German market (base load forwards in €/MWh) 100 90 Forward 2009 80 70 60 50 40 >> 10% 10% sold sold >> 20% 20% sold sold >> 25% 25% sold sold >> 35% 35% sold sold >> 65% 65% sold sold >> 90%
Slide 7: A well balanced customer portfolio and conservative risk management help us to weather the crisis
A well balanced customer portfolio and conservative risk management help us to weather the crisis RWE German external electricity sales per customer group in 2009 Trading / Wholesale market > Exchange traded products: Private and commercial counterparty credit risk > Consumption stable managed by cl
Slide 8: Performance of RWE Innogy
Performance of RWE Innogy Q1 operating result: -35.5% € million Upfront costs of large investment programme Higher staff costs 31 20 2008 2009 Full year 2009 guidance: Operating result below previous year € million Upfront costs of large investment programme 55 Higher staff costs Ò 2008 2009 RWE AG
Slide 9: Performance of RWE Dea
Performance of RWE Dea Q1 operating result: -42.2% Slump in oil prices leads to significant reduction of average € million realised oil price (incl. hedging) Negative f/x effects (-€43 million) 185 Higher realised gas prices partly offset by negative volume 107 effects in UK gas production Slightly
Slide 10: Performance of RWE Supply & Trading
Performance of RWE Supply & Trading Q1 operating result: +298% Trading € million + Marked-to-market performance of trading in line with last 362 year; reported IFRS numbers benefitted additionally from realisation of transactions concluded in earlier years Supply + One-off effect from negative non-o
Slide 11: Performance of RWE Energy
Performance of RWE Energy Q1 operating result: +6.6% + German regions: net gain of approx. 30,000 electricity € million customers. Benefits from efficiency enhancements and improved gas sales business. Lower electricity margins 860 917 International regions: negative f/x effects and lower electricit
Slide 12: Performance of RWE npower
Performance of RWE npower Q1 operating result: -32.2% Negative f/x effects of -€34 million € million Power generation: Reduced generation margins more than offset higher 283 availability of capacity and lower cost of CO2 192 Supply: + Improved margins due to price increases in August 2008 Increased
Slide 13: Non-operating result
Non-operating result January – March Change € million 2009 2008 (absolute) Capital gains 4 31 -27 Impairment losses - - - Restructuring / other 420 -16 +436 Total 424 15 +409 ¾ Capital gains: no major capital gains in 2009. In 2008 mainly income from sale of 8% stake in rhenag to RheinEnergie AG ¾ R
Slide 14: Financial result
Financial result January – March Change € million 2009 2008 (absolute) Net interest -114 -24 -90 Interest accretion to non-current provisions -221 -190 -31 Other financial result -175 -87 -88 Total -510 -301 -209 ¾ Net interest: declined due to higher debt and upfront costs for financing the Essent
Slide 15: Cash flow statement
Cash flow statement January – March Change € million 2009 2008 (absolute) Funds from operations (FFO) 1,940 2,403 -463 Changes in working capital -1,407 -1,019 -388 Cash flows from operating activities 533 1,384 -851 Capex on fixed assets -853 -657 -196 Free Cash flow -320 727 -1,047 ¾ FFO - Various
Slide 16: Outlook 2009
Outlook 2009 2008 2009 € million forecast External revenue 48,950 In the order of last year’s level EBITDA 8,773 In the order of last year’s level Operating result 6,826 In the order of last year’s level Recurrent net income 3,367 In the order of last year’s level Dividend € 4.50 Payout ratio 50% -
Slide 17: Back-up Charts
Back-up Charts RWE AG | Conference Call Q1 2009 | May 14, 2009 17
Slide 18: RWE Group electricity production
RWE Group electricity production January – March Other Total Total in TWh Germany UK Internat. 2009 2008 Lignite 17.1 - 1.2 18.3 18.9 Nuclear 9.9 - - 9.9 12.4 Hard coal 9.6 5.2 0.2 15.0 17.7 thereof contracts 5.2 - - 5.2 8.3 Gas 2.5 3.6 - 6.1 8.2 Renewable energies 0.9 0.3 0.3 1.5 1.4 thereof contra
Slide 19: RWE Group electricity sales volume
RWE Group electricity sales volume January – March Total Total in TWh Germany UK Poland Hungary Other 2009 2008 Private and commercial 8.4 6.0 1.0 1.5 0.2 17.1 17.4 customers Industrial and corporate 13.4 7.7 0.8 1.4 0.2 23.5 25.8 customers Distributors 24.1 - 0.3 1.2 0.3 25.9 23.8 Electricity tradi
Slide 20: RWE Group gas sales volume
RWE Group gas sales volume January – March Ger- Czech Total Total in TWh many Rep. UK Other 2009 2008 Private and commercial 9.8 17.4 19.5 4.8 51.5 46.5 customers Industrial and corporate 10.5 8.8 2.6 9.8 31.7 32.6 customers Distributors 31.6 7.4 - - 39.0 43.4 Total 51.9 33.6 22.1 14.6 122.2 122.5 R
Slide 21: Germany: Clean Dark Spread versus hard coal and CO2 prices
Germany: Clean Dark Spread (CDS) versus hard coal and CO2 prices 160 40 Forward 2009 120 30 80 20 40 10 0 0 160 40 Forward 2010 120 30 80 20 40 10 0 0 160 40 Forward 2011 120 30 80 20 40 10 0 0 01.01.2007 01.07.2007 01.01.2008 01.07.2008 01.01.2009 01.07.2009 01.01.2010 CDS Cal 2009-11 Baseload (€/M
Slide 22: Germany: Clean Spark Spread versus natural gas and CO2 prices
Germany: Clean Spark Spread (CSS) versus natural gas and CO2 prices 50 50 Forward 2009 40 40 30 30 20 20 10 10 0 0 50 50 Forward 2010 40 40 30 30 20 20 10 10 0 0 50 50 Forward 2011 40 40 30 30 20 20 10 10 0 0 01.01.2007 01.07.2007 01.01.2008 01.07.2008 01.01.2009 01.07.2009 01.01.2010 CSS Peakload C
Slide 23: UK: Clean Dark Spread versus hard coal and CO2 prices
UK: Clean Dark Spread (CDS) versus hard coal and CO2 prices 150 50 Forward 2009 120 40 90 30 60 20 30 10 0 0 150 50 Forward 2010 120 40 90 30 60 20 30 10 0 0 150 50 Forward 2011 120 40 90 30 60 20 30 10 0 0 01.01.2007 01.07.2007 01.01.2008 01.07.2008 01.01.2009 01.07.2009 01.01.2010 CDS Cal 2009-11
Slide 24: UK: Clean Spark Spread versus natural gas and CO2 prices
UK: Clean Spark Spread (CSS) versus natural gas and CO2 prices 50 50 Forward 2009 40 40 30 30 20 20 10 10 0 0 50 50 Forward 2010 40 40 30 30 20 20 10 10 0 0 50 50 Forward 2011 40 40 30 30 20 20 10 10 0 0 01.01.2007 01.07.2007 01.01.2008 01.07.2008 01.01.2009 01.07.2009 01.01.2010 CSS Peakload Cal 20
Slide 25: Development of net debt
Development of net debt € billion Capex Dividends Acquisitions/ Cash flows Others Change in disposals/ from including pension, (de)consoli- operating f/x effects nuclear, dations activities DCO mining provisions 25 +1.0 -0.5 +0.4 20.5 +0.9 +0.1 -0.1 20 18.7 15 Including Including DCO1: 4.2 DCO1: 4.5
Slide 26: Financial liabilities and assets: Solid financing in place
Financial liabilities and assets: Solid financing in place (as of 31.03.2009) Financial liabilities in billion Euros Financial assets in billion Euros Split of securities 16.2 15.6 15 14.2 1.7 15 14.6 1.3 0.7 0.6 0.7 0.4 0.5 1.6 1.6 2.3 2.3 1% 10 10 6% 13.1 13.3 5 5 10.1 10.4 93% 2.0 0.3 1.0 1.0 0.5
Slide 27: Development of pension liabilities, plan assets and provisions
Development of pension liabilities, plan assets and provisions change € million 31.12.2008 31.03.2009 absolute Present value of funded benefit obligations 11,872 12,017 +145 Fair value of plan assets 11,030 10,713 -317 Net amount for funded plans 842 1,304 +462 Capitalized surplus of plan assets ove
Slide 28: Gross financial debt currency and interest exposure
Gross financial debt currency and interest exposure1 € / Others 67% $ 2% Floating 6% £ 31% Fixed 94% As of March 31, 2009 1 Excluding American Water; including cross-currency swaps RWE AG | Conference Call Q1 2009 | May 14, 2009 28
Slide 29: We maintain a high level of liquidity and strong sources of financing
We maintain a high level of liquidity and strong sources of financing - even after the bid for Essent Capital market debt maturities1 General financing Fully committed in € bn syndicated loan for liquidity 3 (€1.6 bn 364 days back-up €2.0 bn 3 years) €0.0 bn 2.02 Commercial paper $5.0 bn (up to 1 ye
Slide 30: RWE's current Kyoto credit portfolio for 2008-2012
RWE’s current Kyoto credit portfolio for 2008-2012 Projects by March 2009 Contract volume by technology Hydro 100 N2O HFC23 90 Energy Efficiency Wind 80 Biogas CMM 70 Biomass ERPA1 100 Geothermal mill. certificates 60 others 50 In Validation ERPA1 40 In Contract volume by region 30 Validation China