Net earnings of Germany's second-largest energy producer plunged dramatically in the first quarter, the result of warm temperatures and Germany's gradual shift to renewable energies.
German energy giant RWE said Wednesday its first-quarter earnings had fallen by more than a third as Europe gradually pivots away from fossil fuels and an unseasonably warm winter saw fewer consumers reach for the thermostat.
Net profit came in at 838 million euros ($1.15 billion) in the period from January to March, the company said in a statement, down 36 percent on the same period last year.
Operating profit was also down 18.4 percent at 1.91 billion euros and revenues sank by 8.6 percent to 14.7 billion.
More modest outlook
Plans to sell its oil and gas exploration subsidiary, RWE Dea, to a Luxembourg-based fund run by Russia's AlfaGroup for 5.1 billion euros ($7 billion) also led Germany's second-largest power supplier to cut its forecasts for the year.
"Previous outlooks included the contributions to earnings made by RWE Dea," RWE's chief executive Peter Terium said. "The forthcoming sale also makes it necessary for RWE to adjust its outlook."
Rather than net profits of 1.3-1.5 billion euros, the company expects to earn 1.2-1.4 billion euros in 2014.
With Germany's energy transition in full swing, RWE is not the only major utility here to feel strained as fossil fuels and nuclear power are superseded by renewables such as wind and solar power.
Yesterday, Germany's leading energy producer, E.ON announced its first-quarter profits were 12 percent lower than a year ago.
cjc/ng (AFP, Reuters, dpa)