Rwe Ag Ord S/Adr

Welcome to the RWE conference call. Marcus Kreber, CEO of RWE AG, and Michael Mueller, CFO of RWE AG, will inform you about the developments in the first half of fiscal 2024. I will now hand over to Thomas Denny.

Thank you, Jess, and good afternoon, ladies and gentlemen. Thank you for joining RWE's conference call on the first half of 2024. Our CEO, Markus Kreber, and our CFO, Michael Müller, will first guide you through our presentations before we will start our Q&A sessions. And I'm pretty sure we brought many questions today. And with this, I'll hand over to you, Markus.

Yeah, thank you, Thomas. And also from my side, a warm welcome to everyone. Despite strong headwinds at the start of the year, we have delivered a good financial performance in the first half of 2024. Our investments in wind, solar and batteries are leading to year-on-year growth in renewable energy production and earnings in the renewable segment. We have made significant progress and remain on track to deliver on our growing green strategy. And we have supportive market fundamentals. European power and carbon markets have stabilized. Demand for green power remains strong across all our markets. And election results in the European Union and UK confirm continued policy support for our business. And we deliver. Last Monday, we were successful in the recent German offshore auction, adding 4 gigawatt to our offshore wind pipeline. We FID'd almost 3 gigawatt of renewable projects in the first half of 2024. As we speak, we have in total more than 10 gigawatt of capacity under construction. The returns for these projects are in line with our return targets we set ourselves at the Capital Market Day back in November 2023. We therefore confirm our long-term targets. Our strategy will lead to attractive bottom-line growth and a rapid decarbonization of our company in line with the 1.5 emission reduction pathway. Adjusted EBITDA stood at 2.9 billion euros, and we have already reached more than 50% of our EBITDA guidance for the full year 2024. Adjusted net income stood at 1.4 billion euros, more than 70% of our full year guidance. Based on the earnings in the first half, we confirmed the outlook for the rest of the year at the lower end of our guidance, and we are now more confident that we will achieve that. We continued the transformation of our company with profitable growth through our investments. We have invested 4.5 billion euros net in the first half of the year, with 95% of our investments being taxonomy aligned. The largest share of investments is currently in offshore. Despite the challenging supply chain environment, our construction projects Sophia and Thor are on time and on budget. For our Sophia project on Dogger Bank, offshore construction started in May with the installation of the project's first turbine foundation. And since then, we have added 20 more. The offshore converter platform has arrived on site as well and is currently being installed. At our Danish offshore project tour, onshore cable works have commenced. And we are actively managing our offshore development portfolio. At the beginning of the year, we closed the transaction where we sold a 49% stake in our UK 3 gigawatt offshore project Dogger Bank's house to Masda. And our Dutch system integration project Oranje Wind Total Energies is now on board as our partner. Oranje Wind is our first offshore wind project in the Netherlands with a very attractive characteristics. Given its innovative as electrolyzers, battery storage, e-boilers, and smart charging solutions. We took the final investment decision for this project in July, and we have started the marketing of the project already, with a clear intention to fully contract the project via PPAs ahead of COD. This week, we further expanded our offshore pipeline thanks to our success in the German offshore auction. We have been awarded two attractive sites with a total 4 gigawatt or total bid price of 250 million euros. This low price demonstrates again our bidding discipline. The 62,000 euros per megawatt hour award compares very favorable to the awards of the German offshore auction two months earlier with 1.2 million euros per megawatt. We will explore the possibility of developing the offshore projects together with Total Energies. The supply chain remains the key focus area. In offshore, projects under construction have been de-risked on the procurement side with all key components being secured. Here we make use of synergies across our portfolio and our strong relationships with strategic suppliers. To give you an example, in our tour project, we will utilize the same supplier for foundations as we will use for our Nordic cluster approach. And we will also use the same turbine model in Nordsee cluster as in Oranjewind. We've also made significant progress in de-risking the supply chain for our US solar and battery projects. Today, we have already secured our solar build-out targets for 2024 and 2025, and largely for 2026 by contracting capacities and securing access to local manufacturing. Our contracted capacity been de-risked in terms of ADCVD and bifacial tariff risk. And on the battery side, we are largely de-risked and have secured our demand for 24 and 25 among others through local supply chain. On our way to becoming a global leader in the new energy world, we already see today's significant success in the decarbonization of our portfolio. Electricity production from renewables was on record levels in H1, 26 terawatt hours. And renewable power now accounts for a record 45% of total electricity production at RWE, up from 33% in the same period last year. In the current year, we have also reduced our CO2 emissions significantly by 27% versus last year. by shutting down five lignite units with a total capacity of 2.1 gigawatt and through lower utilization. We do see the market fundamentals for our business being supported. European power and carbon prices have recovered from the lows in February and have stabilized since around four months. Since then, German calendar 2025 base load prices are hovering around 90 euros per megawatt hour, And calendar 25 EUAs are trading around 70 euros per ton, supported by the confirmation of the EU auction calendar. And we have observed a rise in power demand, especially in the US, where year-on-year demand rose by 4% on the back of a positive economic trend and the expansion of energy-intensive infrastructure like data centers. We clearly see that demand for remains strong. The current year, we have already contracted PPAs with a total volume of 1.6 gigawatt of capacity. Only today, we have announced a new 374 megawatt PPA that we have concluded with Meta in the US. And when I look at our PPA pipeline, I expect significantly more to come for the rest of the year. The PPA market is healthy and remains attractive for renewable developers. The policy support for the energy transition remains intact. The European Green Deal has been confirmed following the European elections. The German government just published a white paper on the electricity market design of the future, underlining continuous support for renewables and the need for a fundamental capacity remuneration scheme. Also in Germany, we have just been granted funding for two large hydrogen projects, support of more than 600 million euros. The funds will be used for the construction of a 300 megawatt electrolyzer in Lingen and a hydrogen storage facility in nearby April. In the UK, the new Labour government aims for 100% clean power by 2030, and they have announced an ambitious program to achieve these targets. In onshore wind, the de facto ban on construction has been revoked. For solar, as well as onshore and offshore wind, build-out targets have been increased significantly. And for the current CFD auction, the auction budgets have been raised by around 45%. To sum up, we see continuous policy support for the energy transition and therefore our strategy. We are set to continue to deliver profitable growth. As we speak, we have more than 10 gigawatts of capacity under construction. About half of the projects are in offshore wind. The other half is in onshore wind, solar, battery, and flexible generation. These projects represent roughly 20 billion euros of total investment volume. As of June this year, 6 billion euros have already been spent for these projects under construction. Our investments will deliver the targeted earnings growth. All investment decisions fulfill our strict return requirements with an average investment portfolio IRR of 80% and EBTA yield of at least 10.5%. Thus, these 20 billion euros of investment will represent earnings of more than 2.1 billion euros in EBTA. Let me sum up. RWE will be a global leader in the new energy world. We are on track to deliver on our target set at the capital market day in 2023. By the end of this year, we estimate that we will have an operating portfolio of approximately 38 gigawatts, excluding the phase-out technologies. Our capacity development will result in attractive bottom-line earnings flows. For the current year, we confirm our EPS target of about 2.6 euros per share, growing to four euros per share by the end of the decade. Our transformation will also lead to rapid decarbonization. We expect carbon emissions to be in the range of 45 to 50 million tons per fiscal year 2024, which means a reduction of more than 40 percent compared to 21. From 2024 until 2030, we expect to further reduce our emissions by almost 60% in line with the 1.5 degree SBTI emission reduction pathway. I'm sure you will have some questions about what I presented and maybe some with regards to other topics. But first, I now hand over to Michael. As usual, he will present the financials in all detail. Please, Michael.