Annual General Meeting of RWE AG on 19 April 2012 Dr. Juergen - - PowerPoint PPT Presentation

Annual General Meeting of RWE AG

• n 19 April 2012
• Dr. Juergen Grossmann

Chief Executive Officer

We have been shaping energy transformation since 2008: €23 billion invested

» Nine highly efficient gas and coal-fired power plants » Europe’s leading investor in renewables » Around €700 million annually for the distribution networks in Germany » Wide range of products from energy efficiency to electric mobility

Our efforts are rewarded

» European School of Technology votes RWE European innovation leader in the industry » Fortune ranks RWE number 3 amongst most renowned global energy utilities

2008

8

2009

3

2010

1

2011

3 1 2 3 4 5

We get things done – 24/7!

» 72,000 employees, of which 36,000 are in Germany » Occupational safety: Reduction in accident numbers for 10th year in succession » We continue to train far more people than we need

The topics

How did RWE‘s business develop last year? What is the current status on our package of measures?

1

What challenges will RWE have to

• vercome in the next

few years?

2

What is RWE doing to ensure its long- term success?

3

The topics

How did RWE‘s business develop last year? What is the current status on our package of measures?

1

What challenges will RWE have to

• vercome in the next

few years?

2

What is RWE doing to ensure its long- term success?

3

A difficult year behind us

2011 Compared to 2010 Operating result Recurrent net income CAPEX EBITDA 5.8 2.5 6.4 8.5

(in € billions)

• 34%
• 24%

+/- 0%

• 18%

Main reasons for decline in earnings

Decoupling of gas and oil prices Deterioration in earnings situation in German electricity generation Exit from nuclear energy in Germany 1 2 3

Legal proceedings on nuclear energy

» Legal action against the three-month moratorium on nuclear energy » Review of lawfulness of tax on nuclear fuels » Constitutional complaint against 13th amendment to Atomic Energy Act Judicial decision will make situation clearer for shareholders

Dividend proposal for 2011

» Payout ratio of 50%

• f recurrent net income

» High dividend yield: 7.4% for ordinary shares, 7.9% for preference shares

(€ per share)

* Increased payout ratio

1.50 1.75 3.50* 3.15 4.50* 1.25 2.00 3.50 3.50 2003 2004 2005 2006 2007 2008 2009 2010 2011

Upward trend for RWE share price since beginning of 2012

» Implementation of package of measures is seen as positive Performance of RWE shares (in €) 30.12.2010 30.12.2011

Ordinary share Preferred share

10 20 30 40 50 60

Package of measures to ensure our future success

Strengthening of financial power for long-term growth Capital measures 1 Divestment of parts of business 2 Efficiency programme 3 Streamlining of investment budget 4

Capital measures almost complete

» Equity capital increased by €2.1 billion » Hybrid bonds (mix of equity and third-party capital) placed for around €1.5 billion

Sale of parts of business

Divestments reduced by up to €7 billion Activities of RWE Dea Parts of German sales and distribution networks business NET4GAS Other (Berlinwasser, stakes in fossil-fuelled power plants)

…

New efficiency programme introduced

» We are progressing faster than planned » Target: leverage earnings potential of €1 billion by 2014 » Focus on cost reductions and increase in proceeds 750 250 1,000 250 500 500 500 2013 Total 2014

(in € millions)

2008 2009 2010 2011 2012 2013 2014

Streamlining of investment budget approved

» Investments of €16 billion planned for 2012–2014 » 50% earmarked for growth projects » Growth areas: RWE Innogy, RWE Dea, Central Eastern and South Eastern Europe CAPEX in € billions planned 5.9 6.4 ~4 – 5 ~ 6 6.4 4.5

Faster, more flexible, closer

» Reduction of duplicate functions implemented » Sales and distribution networks centralised » More responsibility in the regions » Expertise on power plant new build pooled within RWE Technology

The topics

How did RWE‘s business develop last year? What is the current status on our package of measures?

1

What challenges will RWE have to

• vercome in the next

few years?

2

What is RWE doing to ensure its long- term success?

3

Transformation of energy industry is complex

What has to be done: » Expansion of renewables » Investment in grids and storage » Enhance energy efficiency » Build flexible new power plants » Citizen participation What we are doing: » We invest some €1 billion each year in renewables » We are investing some €700 million in distribution networks » We are European leaders in energy efficiency products » We are modernising 25% of our conventional power plant fleet by 2014 » We are on the spot

The topics

How did RWE‘s business develop last year? What is the current status on our package of measures?

1

What challenges will RWE have to

• vercome in the next

few years?

2

What is RWE doing to ensure its long- term success?

3

We have the right strategy

» RWE is becoming more international, more robust, more sustainable » Guiding principle: to increase corporate value

A more international RWE

» Europe remains our core market » Regional growth markets in Central Eastern and South Eastern Europe » Expansion of renewables, also outside core markets » Oil and gas production also in the Caspian region and Northern Africa

Additional markets for oil and gas production Additional markets, in particular for renewables RWE core markets with established market positioning Growth markets under observation/initial activities

A more robust RWE

» Presence at all value creation stages » Geographical diversification within Europe » Balanced generation portfolio across all technologies » Stable earnings contribution from regulated business

Electricity and gas networks Electricity and gas sales Power generation Raw materials production Energy trading/ gas midstream

A more sustainable RWE

»20% by 2020 compared to base year 2005 »Efficiency improvement of conventional power plants »Energy efficiency with

• ur customers

Lower CO2 emissions Efficient use of energy

Specific CO2 emissions

Actual Target t/MWh 0.50 0.60 0.70 0.80 0.90 2005 2008 2011 2014 2017 2020

»Expansion of renewables to at least 20% of power generation capacity by 2020

Expansion of renewables

RWE remains a reliable partner

» We accept the primacy of politics » Our strategy makes an essential contribution to the transformation of the energy landscape » RWE is involved in all future topics » Europe remains our main market

Outlook

New team established: Executive Board succession decided Focus on implementation of our package of measures 2012: EBITDA, operating result and recurrent net income on a par with previous year Dividend policy unchanged: Payout of 50-60% of recurrent net income