Grid Expenses Hurt innogy’s Earnings

innogy, a renewable energy, retail and grid spin-off of the German energy company RWE, issued its first independent financial report following the Initial Public Offering (IPO) in October, reporting a dip in earnings in the first nine months of 2016.

The results were negatively affected by  high expenditure on grids and absence of positive one-off effects recorded in the same period a year earlier.

On the other hand, the results were positively impacted by the fact that Gwynt y Mor and Nordsee Ost have been constantly online at full capacity for the first time this year.

innogy achieved external revenue of around EUR 31.5 billion in the first nine months. EBITDA was EUR 2,919 million and the operating result was EUR 1,842 million. Earnings were therefore 7 per cent and 15 per cent below the previous year’s levels, respectively.

Adjusted net income for the period reached EUR 671 million.

In the first three quarters of the year, innogy generated a total of 7.7 billion kilowatt hours of power from renewables, up 5 per cent year-on-year.

In the first nine months, innogy’s capital expenditure was 4 per cent down on the previous year’s period, at EUR 1,108 million. This was primarily attributable to the Renewables Division, the capital spending of which halved. The determining factor here was the completion of offshore wind farms Nordsee Ost and Gwynt y Mor in 2015.

For 2016, innogy continues to expect EBITDA of EUR 4.1 to EUR 4.4 billion, and EBITDA of EUR 4.3 to EUR 4.7 billion is anticipated for 2017. A forecast for adjusted net income is provided for the first time for 2016. This is expected to be in the order of EUR 1.1 billion.

Bernhard Gunther, Chief Financial Officer of innogy SE: “For us, 2016 is a year of transition and of extraordinarily intensive work. October marked a very successful IPO, and today, we are presenting very solid figures for the first nine months of 2016. The results are in line with expectations and we can confirm the forecast for 2016 and 2017.”