E.on renewables' earnings fall by 10%

GERMANY: Utility E.on said its renewables division's pre-tax earnings fell 10% to €1.35bn in 2015, as its CEO predicts a "tougher and longer" transformation following the separation of its business.

E.on's Amrumbank West project was completed in 2015
E.on's Amrumbank West project was completed in 2015

Ebitda (earnings before interest, tax, depreciation and amortisation) for renewables fell from €1.5bn in 2015, despite the returns from over 500MW of new offshore wind capacity installed in the past 12 months.

Much of the fall was put down to lower wholesale electricity prices and the sale of Spanish and Italian operations under its hydropower business.

However, ebitda for the company's wind and solar business fell €43 million, 5% year on year, which E.on attributes partly to a particularly high 2014 result .

The company said its two new offshore projects — Amrumbank West (288MW) and Humber Gateway (219MW) — had a positive effects on earnings.

The fall in earnings for the wind and solar division matched the performance of the E.on group as a whole, which the company blamed mostly on falling electricity prices.

This was the last time E.on reported its financial results as a single company. From 1 January 2016, it has spun-off its conventional power and energy trading business into a new company called Uniper.

E.on's focus has switched to cover renewable power generation, energy networks and customer solutions.

CEO Johannes Teyssen said: "We posted solid operating results in a very difficult market environment. Our numbers reflect the far-reaching structural transformation that our industry is experiencing and that continues unabated in the current year.

"Our strategy of having E.on and Uniper focus on their respective energy world is the right response to this transformation. But the course ahead will be tougher and longer than anticipated," he added.

The company's shareholders will be asked to approve the spin-off at the annual general meeting in June. If approved, E.on will divest its stake in Uniper and list its shares in the new company on the stock market.

E.on operates approximately 4GW of onshore wind capacity worldwide and owns over 1GW of offshore installations.

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