RWE Posts Adjusted Operating Profit of €4.58 Billion, Beating Analyst Expectations
Key Facts
RWE said on November 11 that adjusted earnings before interest, taxes, depreciation and amortization totaled €4.58 billion in the first nine months of 2026, exceeding the average analyst estimate of €4.43 billion in a company-conducted poll. The result came in a period when all segments made higher contributions than in the year-earlier period, Chief Financial Officer Michael Müller said. Müller said the company had directed about €11 billion net toward expanding its portfolio during the nine months. RWE attributed the improvement in earnings to new assets entering service, more favorable wind conditions in Europe and strong performance in its Supply & Trading segment. Adjusted net income rose to €1.8 billion from €1.3 billion, while adjusted earnings per share were €2.52, compared with €1.77.
The company said it had achieved about 85% of its annual adjusted earnings-per-share target after nine months and reaffirmed its guidance range for fiscal 2026. RWE expects adjusted earnings before interest, taxes, depreciation and amortization of between €5.75 billion and €6.35 billion, and adjusted net income of between €1.95 billion and €2.45 billion. It added that it expects to finish the year near the upper end of the ranges. Adjusted EBITDA in the third quarter alone was €1.56 billion, up 13% year on year. The result exceeded the company consensus for the quarter by 10% and Jefferies' estimates by 5%, according to Investing.com data.
The Supply & Trading segment was one of the main sources of improvement, with adjusted EBITDA rising to €543 million in the first nine months of 2026 from €150 million in the year-earlier period. RWE now expects the segment's performance for the year to exceed the upper end of its previous guidance range of €100 million to €500 million. In the third quarter, the segment's adjusted EBITDA was €409 million, up 205% year on year. The segment was the largest contributor to the quarter's earnings beat, and its performance was 82% above the company consensus, according to Investing.com. The company cited strong trading earnings among the main factors supporting the period's results.
The Offshore Wind segment recorded adjusted EBITDA of €1,110 million in the first nine months, compared with €915 million in the year-earlier period of 2025. The company attributed the increase mainly to higher generation as wind conditions improved, with an initial contribution from farms still under construction. In the Onshore Wind and Solar segment, adjusted EBITDA rose to €1,497 million from €1,242 million. RWE attributed the segment's improvement mainly to new generation capacity and more favorable wind conditions in Europe. It said the conversion of dollars into euros had a negative effect on its results.
Net investment totaled €10.7 billion in the first nine months, while net debt reached €17.0 billion on September 30. RWE expects net debt to fall to about €12 billion by the end of 2026. The company attributed the expected decline mainly to the deconsolidation of the Vanguard West and Vanguard East projects following the establishment of the joint venture with KKR. On the same day, the completion of a deal for UK offshore wind projects with capacity of 2.8 gigawatts in partnership with KKR was announced, according to Reuters. RWE reaffirmed its 2026 dividend target of €1.32 per share, aiming to increase dividends by 10% annually through 2031.
In investments to secure supply, RWE won contracts to build three hydrogen-ready gas plants in the German state of North Rhine-Westphalia. The plants' capacity counted in the auction was about 2,100 megawatts, according to the company's announcement on November 3. RWE said the tender rules counted 85% of the gas plants' installed capacity. For the stock, Jefferies maintained its Buy rating and €75 price target, implying potential upside of 29% based on the share price cited in its note. RWE is scheduled to present its fiscal 2026 performance on March 4, 2027, at a press conference and an investor and analyst conference.