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UTILITIES: RWE (RWE Baa2/NR/BBB+): 3Q24 Results

UTILITIES
Credit BulletsCEEMEAEurozoneGermanyBulletGlobalRegion

Marginal negative on the buyback over investment, but unlikely to be market moving.

• RWE reported adj. EBITDA 11% ahead of consensus (3 estimates).
• We estimate FCF at -€980mn on elevated investments. YTD FCF stands at -€5.64bn.
• Net debt increased €735mn to €12.2bn. Leverage stands at 2x and is expected to stay well below 3x cap for FY24.
• FY24 guidance is improved from the low end to the middle end of the range, effectively a 6% improvement from low end to midpoint and ~3% ahead of consensus.
• €1.5bn buyback over the next 18 months announced from zero. The pace of capex will be slowed over the next 2 years due to uncertainty on renewables in the US and slower than expected development of green hydrogen in Europe. That’s around 0.25x turns of LTM leverage for context.
• Webcast 12.00 GMT https://www.rwe.com/en/investor-relations/financial-calendar-and-publications/2024-Q3/

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Marginal negative on the buyback over investment, but unlikely to be market moving.

• RWE reported adj. EBITDA 11% ahead of consensus (3 estimates).
• We estimate FCF at -€980mn on elevated investments. YTD FCF stands at -€5.64bn.
• Net debt increased €735mn to €12.2bn. Leverage stands at 2x and is expected to stay well below 3x cap for FY24.
• FY24 guidance is improved from the low end to the middle end of the range, effectively a 6% improvement from low end to midpoint and ~3% ahead of consensus.
• €1.5bn buyback over the next 18 months announced from zero. The pace of capex will be slowed over the next 2 years due to uncertainty on renewables in the US and slower than expected development of green hydrogen in Europe. That’s around 0.25x turns of LTM leverage for context.
• Webcast 12.00 GMT https://www.rwe.com/en/investor-relations/financial-calendar-and-publications/2024-Q3/