RWE in the red on German nuclear phase-out
RWE, Germany's second-biggest power supplier, said Thursday it plunged into the red in the third quarter, not least as a result of the country's decision to phase out nuclear power.
RWE said in a statement it booked a net loss of 174 million euros ($235 million) in the period from July to September, compared with a year-earlier profit of 594 million euros.
Operating profit plummeted 69.6 percent to 410 million euros and revenues dropped 4.0 percent to 10.71 billion euros.
For the first nine months as a whole, bottom-line net profit was down 46.3 percent at 1.416 billion euros on a 0.9-percent decline in revenues to 38.167 billion euros.
"Group earnings deteriorated considerably year on year" in the first three quarters, RWE said.
"The lifetime reduction imposed on our German nuclear power stations was a major contributing factor. Together with the new nuclear fuel tax, it reduced the operating result by about one billion euros compared to the first nine months of 2010," the group said.
But earnings were also hurt by lower electricity generation margins, an "unusually weak performance" by RWE's energy trading activities and substantial burdens in the midstream business, it said.
Looking ahead to the full year, chief executive Juergen Grossmann said "this year continues to be dominated by the accelerated nuclear phase-out, lower electricity margins, and heavy burdens in the gas midstream business."
Accordingly, RWE was pencilling in a 25-percent decline in full-year operating profit and a 35-percent drop after tax, he said.
"The coming years will also be difficult for us, but I am confident that we will quickly get through the trough ahead of us," Grossmann said.
© 2011 AFP