Innogy's EBIT up by 4% in H1 but not for renewables

Zuidwester wind farm. Image by innogy.com.

Aug 11 (Renewables Now) - Innogy SE (ETR:IGY), the operator of wind and hydropower plants (HPPs) with separate grid and retail divisions, lifted its adjusted EBIT for the first half of 2017 by 4% to some EUR 1.7 billion (USD 2bn).

The company, a unit of RWE AG (ETR:RWE), said today the increase was due to the grid business, where adjusted earnings before interest and tax (EBIT) grew by 19% thanks to lower operating and maintenance costs. In Renewables, EBIT fell by 18% because of below-average wind and precipitation levels and the devaluation of the British pound against the euro. The prior-year Renewables result also included positive one-off effects that did not recur.

The Retail divisions saw its adjusted EBIT contract by 8%.

Power generation in the first half declined by 8% to 5.7 billion kWh, including 65% on- and offshore wind and 21% run-of-river and energy storage. There was also some solar and biomass generation and conventional power.

Results in EUR million H1 2017 H1 2016 2017 forecast
Adjusted net profit 857 740 Over 1,200
Net profit to innogy SE shareholders 817 1,080 --
Adjusted EBIT 1,725 1,666 About 2,900
- of which Renewables 179 219 About 350
Adjusted EBITDA 2,439 2,385 About 4,400
- of which Renewables 338 376 --
External revenue 21,705 22,780 --

CEO Peter Terium said the expected 7% year-on-year jump in annual net profit is good news for shareholders, as Innogy’s plan is to continue paying out 70%-80% in dividends.

In the second half of 2017 the company will focus on three topics -- aligning grid infrastructure with the demands of “the energy world of the future”, entering new markets in electricity generation from renewables, with a focus on North America, and expanding its e-mobility business with a goal to turn into a leading solution provider for charging infrastructure in Europe and the USA.

Net debt at the end of June was EUR 17.1 billion, up by some EUR 1.4 billion from end-2016.

(EUR 1 = USD 1.18)

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Tsvet has been following the development of the global renewable energy industry for seven years now. She's got a soft spot for emerging markets.

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