RWE is pursuing its growth and investment strategy and by year-end, the company will commission new wind and solar farms with a total capacity of 1.3GW, even though the commissioning of some assets will be deferred to next year due to the coronavirus, especially in the USA.
For the first six months, RWE posted adjusted EBITDA (earnings before interest, taxes and depreciation and amortisation) of €1.8 billion. This represents an increase of about 18% compared to the pro-forma figure of €1.5 billion for the same period last year. A 33% gain was registered for adjusted EBIT, which rose to €1.1 billion, compared to €817 million on a pro-forma basis in the prior-year period. Adjusted net income totalled €795 million. On this basis, RWE projects that both adjusted EBITDA and adjusted EBIT will be at the upper end of the forecast range for fiscal 2020: Adjusted EBITDA should come in between €2.7 billion and €3.0 billion, with adjusted EBIT of between €1.2 billion and €1.5 billion. The target for adjusted net income is €850 million to €1.15 billion. The company confirms its planned increase of the dividend to €0.85 per share for this year.
RWE will further strengthen its core business by investing in new assets, making acquisitions, developing project pipelines and driving innovative technologies forward. One example of this is the planned acquisition of Nordex’ European 2.7GW onshore wind and solar development business. Another example is the 1.4GW Sofia offshore wind farm (UK), for which RWE has now chosen the preferred suppliers for the project’s high voltage direct current transmission system and turbines.
RWE’s financial reporting is aligned with the company’s new strategic focus. The core business consists of four segments: Offshore Wind, Onshore Wind/Solar, Hydro/Biomass/Gas and Supply & Trading. These four segments generated adjusted EBITDA of roughly €1.5 billion in the first half of the year. This represents growth of about 9% compared to the pro-forma result for the prior-year period. For the year as a whole, RWE is targeting for its core business operating earnings of between €2.15 billion and €2.45 billion.
In the Offshore Wind segment, adjusted EBITDA rose in the first six months of 2020, reaching €585 million, versus €490 million pro forma in the same period last year. This increase of almost 20% was mainly due to better wind conditions in the first quarter of 2020. For the current fiscal year, RWE expects the segment’s adjusted EBITDA of between €900 million and €1,100 million.
Adjusted EBITDA in the Onshore Wind/Solar segment increased by 12% to €273 million, compared to the first six months of 2019 when it totalled €244 million on a pro-forma basis. This performance was driven by the commissioning of new capacities and higher wind volumes. For this year, RWE expects the segment’s adjusted EBITDA of between €500 million and €600 million.