Rwe Ag Ord S/Adr

Welcome to the RWE conference call. Markus Krebber, CEO of RWE AG and Michael Muller, CFO of RWE AG, will inform you about the developments in the first half of fiscal 2026. I will now hand over to Thomas Denny. Please go ahead.

Thank you, Laura, and good afternoon, everyone. Welcome to RWE's conference call on our results for the first half of 2026. Thank you for joining us today. Markus Krebber, our CEO, and Michael Muller, our CFO, will start by taking you through the presentation. After that, we'll open the call for questions. Markus, over to you.

Thank you, Thomas, and a warm welcome to everyone. This year to date has been quite decisive and successful for us. I'm very happy with the continued progress we are making in strengthening our portfolio as well as in delivering our operational and financial targets. And with that, let's jump into the presentation. We have delivered an excellent financial and operational performance in the first half of 26 and therefore raised our earnings expectations for the current year and for 2027. For 2031, we had already elevated our guidance when we announced the Amprion transaction. Market fundamentals continue to remain strong. Structural demand growth, energy sovereignty, and the necessary grid build-out provide significant investment opportunities for us. We are best positioned to capitalize on these market fundamentals. We have further strengthened our platform through the increase in our stake in the German electricity TSO Amprion to 55%. Our strong project pipeline and our portfolio of attractive sites perfectly position us to capitalize on the further growth catalyst ahead of us and to deliver upside to our current plan. Our agenda is clear. Disciplined investments Based on financial strengths, we'll deliver long-term secured earnings and dividend growth. Let's have a look at our financial performance. We have delivered an excellent financial performance in the first half of 26. Adjusted earnings per share stood at 1.8 euros, up more than 60% year over year. mainly driven by strong operational development of all business segments and the compensation payment in the Netherlands. Our trading business is back on track and has delivered a strong performance in the second quarter of the year. Strong performance in trading continued in July and August. As of today, we have already reached the midpoint of our guidance range to 100 to 500 million euros. For the full year 26 and 27, we have raised our EPS guidance. The 26th target has been increased from €2.55 to €2.95. Our new 27 EPS guidance of €3.15 fully reflects our 55% stake in Amprion and higher power generation margins. Let's now look at what is ahead of us. The fundamentals in our business remain strong. Power demand is growing. In Europe and the US, demand is expected to increase by more than 10% on average by 2030. The key drivers are clear. Further electrification across transport, heating, and industry, as well as rapid growth in demand from data centers. At the same time, energy sovereignty has become a strategic priority. therefore intends to significantly accelerate electrification. The European Commission has proposed almost doubling the share of electricity in total energy demand to 46% by 2040. Additional generation capacity alone will not be enough. The entire power system needs to expand. A system with significantly more renewable generation requires additional grid infrastructure, storage and flexible generation capacity. In Germany, loan transmission system operators expect with investments of more than €360 billion by 2045. The conclusion is clear. These structural trends provide significant investment opportunities for us, and we are very well positioned to capitalize on these trends. We have superior delivery capabilities, a broad pipeline across regions and technologies, and a portfolio of attractive sites. Our investment program perfectly reflects this. In addition to renewable and flexible power generation across our core markets, it now also includes regulated grid infrastructure. From 26 to 31, we plan to invest 42 billion euros net across all core businesses. Our strict return criteria for new generation and storage projects remain unchanged. The IRR will be above 8.5% on average. For our grid investments, we target a return on equity of more than 8%. Our investment program will deliver strong and visible earnings growth with adjusted EPS growing at a CAGR of 10% from 25 to 31. Dividends will be increased in line with earnings plus 10% per annum. Let's now have a look at our strategic and operation delivery in the first half of 26.