Rwe Ag Ord S/Adr

Welcome to the RWE conference call. Markus Kreber, CEO of RWE AG, and Michael Mueller, CFO of RWE AG, will inform you about the development of the first half of TISCO 2025. I'm going to hand the call over to Thomas Denny. Please go ahead, sir.

Thank you, George, and good afternoon, ladies and gentlemen. Thank you for joining RWE's conference call on H1 2025. Our CEO, Markus Kreber, and our CFO, Michael Müller, will first guide you through our presentation, and then we will start our Q&A session. And with this, over to you, Markus.

Thank you, Thomas, and a warm welcome to everyone. Our robust portfolio led to a good financial performance in the first half of 2025, despite weak wind conditions in Europe and a low trading result. We are on track to deliver our full-year earnings guidance. Our construction program is progressing well with around 11 gigawatt under construction, more than 3 gigawatt will begin commercial operation in the second half of this year. And all our offshore construction projects are on schedule. The investment frameworks in our core markets are taking shape. In the UK, the market design provides a stable environment for future investments. In Germany, we see a focused energy policy with higher priority for security of supply and industrial competitiveness. In the U.S., the big beautiful bill has been signed into law. And we are prepared to take advantage of the upcoming investment opportunities if our investment criteria are fulfilled. Our U.K. offshore pipeline puts us in a great position to take a selective approach for the upcoming AR7 auctions. In Germany, we have an attractive development pipeline for new gas plants and batteries, which will enable us to benefit from the rising investment opportunities in flexible generation and security of supply. In the US, we have the potential to continue our build-out program in the next years. Our robust portfolio in combination with our disciplined capital allocation gives us high visibility on our earnings per share growth. And on the back of our dividend close and the running share buyback program, we will deliver an attractive shareholder return. Let's now get into the details and move to slide five. We have delivered a good financial performance in the first half of 25, despite the headwinds of weak wind and low trading. Adjusted EBITDA stood at 2.1 billion euros and adjusted that income at 0.8 billion. Adjusted earnings per share stood at 1.1 euro, reaching 50% of the full-year guidance midpoint. When markets were dominated by geopolitical events and less by market fundamentals, our traders were cautious in position taking. Hence, we see low earnings. In Q3, we have so far seen an increased performance in trading. We remain confident of delivering earnings within our guidance range for all segments. For the full year 25, we confirm our adjusted EBTA, adjusted net income, as well as adjusted EPS diets. Our construction program is progressing well. As we speak, we have around 11 gigawatt of capacity under construction, diversified across regions and technologies. Out of that, we will bring more than 3 gigawatts to commercial operations in the second half of the year, mainly onshore wind, solar and batteries. And all our offshore projects are well on track. SOFIA, our 1.4 gigawatt project in the UK, has reached a major construction milestone with a successful installation of the 100th and final offshore monopile foundation in mid-July. Since March, We have installed 36 turbines and we expect quick connections and first power later this year. Full commercial operations will be in 26. In our Danish 1.1 gigawatt offshore project TOR, foundation and cable installation work are ongoing. So far, 49 of 72 foundations have been installed. Installation of turbines is expected to begin in 26. Our 660 megawatt Nordsee Cluster A project in Germany has also reached a key milestone. We installed the first foundation in mid-July. As of now, four turbine foundations have been installed. Wind turbine installation is expected to start in 26 with commercial operations beginning in early 27. As part of our constant portfolio optimization, we closed the sell-down of 49% of Toa and Naughty Cluster to Norvus Bank Investment Management in Q2 this year. In our one-year wind offshore project in the Netherlands, we will start to install the foundations in summer 26. For this project, we have joined forces with Total Energies in a 50-50 joint venture. In our core markets, visibility of investment frameworks has improved over recent months. In the UK, we have clearly seen positive developments. Firstly, the retention of one price zone keeps a certain and stable landscape for future investments. Secondly, the updated AR7 auction rules are a signal of confidence and a strong commitment to the renewable energy strategy of the UK government. The decision to extend CFD periods from 15 to 20 years de-risks the cash flow of projects further. The raised price cap and improved load factor assumptions for offshore are positive developments too. Now, the size of the auction budget will be key, which was expected in autumn before bids are due. We have a strong UK offshore development pipeline that can participate. Nine eligible projects with a capacity of up to 7.5 gigawatt offer us a broad range of options. The 7.5 gigawatt still includes 100% share of the Norfolk cluster. As part of our offshore portfolio optimization, we will reduce our stake to 50% and we will project finance these assets. With our versatile and mature offshore project pipeline, we are able to be selective, prudent and flexible on timings. All investment decisions must fulfill our strict investment criteria and we will continue to be very disciplined in the auctions as we have proven over the last years. The German energy policy is focused on cost efficiency, security of supply and industrial competitiveness. The key pillar to ensure security of supply is the auction of gas new bills. We expect the auction design to be published before the end of this year. That would mean the first assets could come online by the end of the decade. The second step, a technology neutral capacity mechanism is planned. The new EU rules now give clear guidance for a fast track approval process. The focus on cost efficiency and industrial competitiveness is a positive signal for the German industry, hence our customers. As part of the coalition agreement, the government is working on relief measures for the energy-intensive industry. The €500 billion infrastructure package the German government will put in place helps to support the overall economy. We are prepared to take advantage of the upcoming investment opportunities again if our investment criteria are fulfilled. Our attractive gas power plant pipeline is well developed and we are ready to construct 3 gigawatt of gas plants if we are successful in the auction. We have our respective supply chain largely secured and have already reservation agreements for 2.7 gigawatt of gas turbines and engines. We have also been active on the development of additional battery opportunities. Batteries will continue to play a key role in the integrated power system with renewable energy and deliver attractive returns. In Germany, we currently have 400 megawatt of batteries in operations and 1 gigawatt under construction. Additionally, we have around 2.5 gigawatt of battery projects under development in Germany, which have a planned COD before the end of the decade. In the U.S., we have been maintaining our strict requirements for investments in the current market environment. We only bring projects to FID that have tax credit safe Harvard, tariff risk mitigated offtake secured, and all necessary permits in place. With the Big Beautiful Bill now being passed, we do see continued tax support for further build-outs. We are awaiting final clarity on tax credit eligibility, such as start of construction and safe harbor provisions, as well as FEOC restrictions in the coming weeks. Our proactive procurement strategy has been helping to manage and limit tariff risk. The market environment remains positive as we see overall structural power demand growth in the U.S. This helps us to secure offtake for our projects ahead of FID. However, we will not compromise on the strict investment criteria and risk management requirements. Coming to the conclusion on page 10, we offer attractive earnings growth through 2030. Bottom line earnings will grow with a strong 18%. EPS CAGR to 27% and 13% to 2030. We target an annual dividend increase of 5% to 10% per annum, and we will execute on our existing share buyback program of 1.5 billion euros, which runs until Q2 26. And with that, now over to Michael.