RWE Aktie

Welcome to the RWE Conference Call. Michael Muller, CFO of RWE AG, will inform you about the developments in the first quarter of fiscal year 2026. I will now hand over to Thomas Denny. Please go ahead.

Good afternoon from Essen, and thank you for joining the RWE Q1 Investor and Analyst Conference Call today. Our CFO, Michael Muller, will guide you through our key highlights and the financial performance of the first quarter as well as the outlook for the current year.

And with this, let me hand over to you, Michael.

Yes. Thanks, Thomas, and good afternoon to all of you. We had a good start into 2026. Adjusted EBITDA stood at EUR 1.6 billion and adjusted net income at EUR 600 million on the back of a strong financial performance. Earnings per share was EUR 0.85, 25% up year-on-year. We have already achieved 33% of our full year adjusted EPS guidance. And thus, we confirm our guidance and we are now even more confident of achieving our targets. All of our Offshore Wind projects under construction are on budget and on schedule to achieve our planned CODs.

Furthermore, we have reached key milestones in our Danish Thor and British Sofia projects. Both projects generated first power in Q1 of this year. We've also secured further long-term earnings. We were awarded 6.4 gigawatts in the U.K. T-4 capacity auction for delivery in 2029 and 2030. In total, 39 of our assets across gas, hydro, wind and battery storage were successful. Out of those, 4 assets secured 3-year agreements. Following the Annual General Meeting in May, we paid out a dividend of EUR 1.2 per share to our shareholders. And our EUR 1.5 billion share buyback program will be concluded by May 2026 as planned.

Let's now take a closer look at the Q1 2026 financials. Despite a weak trading result, we achieved a strong earnings. Adjusted EBITDA was up 25% year-on-year. In Offshore Wind, adjusted EBITDA was EUR 570 million. Earnings were significantly higher than last year, mainly due to normalized wind conditions in the current year. Onshore Wind and Solar recorded an EBITDA of EUR 507 million. The results mainly increased on the back of organic growth, primarily in U.S., and better wind conditions in Europe compared to last year. This was partially offset by lower hedge prices in Europe and the U.S. after particularly strong hedge results in last year's Q1. In addition, we had a negative FX effect in the U.S.

Adjusted EBITDA in the Flexible Generation business was EUR 657 million. Earnings are significantly up on the back of a EUR 332 million compensation payment for production restrictions of our Eemshaven power plant in the Netherlands in 2022. The compensation has now been approved by the EU Commission.

Our Supply & Trading business had a weak start to 2026. The Q1 result was minus EUR 84 million. However, despite a weak Q1, we continue to be confident that we'll achieve our guidance for the full year. Other/consolidation was minus EUR 19 million. This is in line with our expectation and based on the timing effect at Amprion. In total, adjusted EBITDA came in at EUR 1.6 billion.

Adjusted depreciation was higher compared to last year's Q1 due to organic growth. The year-on-year adjusted financial result improved due to an increase of capitalized interest. For adjusted tax, we applied the general tax rate of 20% for the RWE Group. Adjusted minority interest increased due to our partners' share in capitalized interest and Apollo's share in our participation in Amprion. Adjusted net income stood at EUR 608 million, resulting in adjusted earnings per share of EUR 0.85.

The adjusted operating cash flow was minus EUR 2.3 billion at the end of Q1, driven by seasonal effects in operating working capital as well as changes in provisions and noncash items. Changes in operating working capital were marked by the seasonal purchase of CO2 certificates and an increase in accounts payable. Changes in provision and noncash items were also driven by seasonal effects in the utilization of provisions. It also includes the cash flow of our phaseout technologies.

Net debt increased to EUR 15.6 billion due to investments and the seasonal effects in our adjusted operating cash flow. In total, we invested EUR 2.3 billion net, mainly in the growth of our Offshore Wind, Onshore Wind and Solar businesses. At the end of the year, we expect net debt to be at our 3x leverage target.

For '26, we confirm our outlook. In the first quarter of the year, we delivered a strong financial performance, reaching 30% of our EBITDA guidance and 33% of our adjusted EPS guidance for the full year. We are, therefore, even more confident of achieving our full year targets. Adjusted EBITDA is expected to be between EUR 5.2 billion and EUR 5.8 billion. Adjusted net income will range from EUR 1.5 billion to EUR 2.05 billion, and adjusted earnings per share between EUR 2.2 and EUR 2.9. The dividend target is EUR 1.32 per share for this year and reflects our annual 10% dividend growth targets.

And now let me hand back to Thomas for Q&A.

Thank you, Michael. We'll now start the Q&A session. And operator, please begin.

[Operator Instructions] We will now take our first question from Ahmed Farman of Jefferies.

I have 2, just on the guidance and the first quarter results. Firstly, I'd like to confirm if the EUR 322 million that you show in the FlexGen, was that sort of originally included or excluded from the March guidance and whether today's confirmation is on the same underlying basis as originally outlined back in March?

And then secondly, since you're sort of maintaining the range for the Supply & Trading despite the first Q loss, I'd be interested to see what you're seeing so far in 2Q. And if the overall range from today's perspective is still relevant? Or would you sort of steer us in a certain direction given the first quarter results?

Yes, Ahmed, thanks for the question. First of all, I can confirm that the EUR 332 million were not included in the guidance. So that comes on top. And on Trading, I can confirm that the guidance range is still valid, yes, as I said. And you know that we typically don't comment on intra-quarter performances.

And so Michael, just to confirm, so the confirmation comments around the guidance is on an underlying basis? Can I just clarify that, for the full year...

It's your question, Ahmed, whether our views on an underlying basis have changed since mid-March.

Yes, correct.

And that did not -- yes, that did not -- so it has not changed.

And we'll now move on to our next question from Deepa of Bernstein.

I had 2. First one on the German capacity market auctions. I think, now we have some firm dates, like September 1 and 8th of December. So I was just wondering what's the difference between these 2 auctions? And at this minute, are you aware of what might be the pricing mechanism or anything around the rules? So if you could talk about that?

And second question, sorry, a bit boring in terms of an accounting question. It's on the interest capitalized in your accounts. So last year, you had around EUR 800 million for the full year. Before that, before -- in '24, it was just around EUR 200 million. This year already in Q1, there's EUR 250 million that is capitalized. I think this is all coming from the Offshore Wind projects under construction. So I was just wondering, obviously, for the full year, probably this is around EUR 750 million, EUR 800 million. But going forward, as you're focusing more on U.S., which will be much more shorter-term gestation period projects plus for Offshore, you're shifting to project finance, et cetera. I was just wondering more medium term, what is this cadence? Like, when do we go from like this EUR 800 million down to EUR 200 million or so, which used to be kind of like more in the past? So that was the question.

Yes. Deepa, let's first start with the German capacity auction. So you're right. The current plan is that, beginning of September and in December, there should be 2 auctions. Actually, it's today in the cabinet of the German government. So we hope to pass it and then to be handed over to the parliament to then take the decision quickly before the summer break so that we also will have the first auction in September. If I'm not completely wrong, the idea is to split the 9 gigawatts into 2. So there's one auction taking -- so one auction is then 4.5 and the other one is also 4.5. That is the idea behind it. And the pricing mechanism is, it's an auction and it's pay as bids. So that's actually -- I mean, we would have wished for pay as cleared because we believe that's the best or better market mechanism, but it's currently a pay-as-clear (sic) [ pay-as-bid ] design, which is also fine for us.

Second question on the capitalized interest. Yes, you are right in your observation. So what is happening in the course of the year is we only capitalized interest in Offshore on a turbine basis. So the moment a turbine comes into operation, we don't capitalize anymore. And therefore, as we have Sofia and Thor and also Nordseecluster currently in the commissioning or construction commissioning, that will lead to a certain phaseout of the capitalized interest. And kind of going forward, so this year, you're right, it's roughly EUR 800 million and then going forward, it will come down, '27, to roughly EUR 600 million and then '28 slightly lower than that. But obviously. Yes, there's always the offsetting effect then in financing costs.

And we'll now take our next question from Alberto Gandolfi of Goldman Sachs.

The first one is on the outlook on Page 8. I was wondering if you could potentially comment by division, if you see EBITDA for the year in light of Q1, which is always a larger share of the full year, if you see that at the low end, midpoint or top end? And maybe if you could, specifically on Trading, elaborate a little bit more what happened in Q1 and what's happening now? I mean, I heard from other companies in similar activities talking about pretty aggressive degrossing following the start of the conflict. And I was wondering if this is still the case or if you have grossed up your Trading books and actually now you've been making money in the division. Again, I'm not asking for quarterly development. I'm asking to see what's going on in the division.

The second one is a bit broader picture. And I was wondering, this is the second energy crisis in 4 years. And I was going to ask your opinion, do you think EU learned its lesson, or you see signals that suggest Europe is learning the lesson and countries are learning the lesson? We saw EC paper on April 22, asking for faster electrification. But do you think really there's going to be like EUR 200 billion deployed against this? Do you really think we're going to see heat pumps acceleration, EV acceleration, electric boilers? And if so, how is this going to impact your business?

Yes, Alberto, I mean, on your first question, I would refer back to Ahmed's question where I said that the one-off effect was not included in the guidance, and the underlying view on the business hasn't changed. So therefore, in short, you can expect that, obviously, the guidance of the Flexible Generation business is then probably more conservative as we now have the one-off in the numbers, and that wasn't included in the initial guidance.

Then on Trading, I mean, look, we don't talk about a specific position, but it's a little bit more complex. I mean, clearly, what you see currently is that we have much higher volatility in the market than we used to have. So if you look at the -- I mean, we steer our business apart from other KPIs also on value at risk. And with higher volatility, it means that even with small positions, you have still a sizable value at risk. So effectively, volatility is higher, the positions are typically smaller, but it means kind of the value at risk or the risk you have in the position is about similar. So from that perspective, I would say, yes, the traders kind of obviously adjust their position to the volatility, that's it. And obviously, we also -- you can assume that also we, as management, have a very close view after the weak Q1 on the performance. So discussion about major positions, that's obviously something we have. So you can imagine that positions we have on the books, are those where we really have a high confidence of the risk return trade-off.

Concerning the energy crisis, I mean, look, I wouldn't look too much into the direction of EU. I think that the good thing is what we see is that Brussels clearly has learned the lessons from the last energy crisis, meaning if you look at the discussions around maintaining the energy-only market design, meaning maintaining the EU ETS trading system, what they have communicated so far is a confirmation of the existing systems and just some kind of optimization within the existing system, which I think is exactly the right thing. So they realize that if you have a supply crisis, the markets are the best ones to bring the markets back into balance. And they also acknowledge that the CO2 trading system is ultimately working and leading clearly to a decarbonization of the energy system. So that's, I would say, good news for us because it provides stability of the market design going forward.

Honestly, the rest you see from the EU is, from my point of view, rather weak. So I would rather expect that here, it's more about the member states to really take action to drive forward. And what I would put forward is that clearly, governments have understood that resilience and independence you can only get in Europe via building out more renewables. That obviously means it needs to be a stable system. So there needs to be some complementation with flexible energy. But it's clearly more renewables, and it's also clearly more electrification. So therefore, I do expect to see more momentum, both on the renewable side, but also on the electrification side and the same time, also in firming up the power generation by flexible generation batteries or gas assets.

Michael, if you allow me -- sorry, this is all very clear. Just one small clarification. When you talked about volatility earlier has gone up, so smaller position, value at risk is the same. Historically, high volatility has been a positive for Trading. So can we assume the same correlation, i.e., good backdrop for Trading going forward?

You now want to get me comment through the back door on the actual performance. No. But I mean, I would say the following: In principle, your rule is right. I think the key question is where does volatility come from? If volatility comes from rumors or noises or x, that's not necessarily what our traders like. And -- and that was actually also the situation we saw in Q1 where announcements around the EU trading system and also the start of the war and some other rumors led to volatility, but volatility that was not driven by fundamentals, and that also led to the negative impact we saw in Q1.

And we will now take our next question from Pavan Mahbubani from JPMorgan.

Firstly, it would be great to get an update on your side on how you're seeing the demand for your products in the U.S. developing in terms of solar, wind, batteries. Are you seeing strong demand? Do you feel more confident in your outlook versus where we were in March? Or are things relatively unchanged?

And my second question is on the U.K. I mean it feels like we're entering a period now of political uncertainty. How are you thinking about that as it relates to your investments in the U.K. and particularly around your AR7 projects? Would you consider slowing down or delaying FIDs until there was visibility? It would be great to get your thoughts on that.

Yes, Pavan, let's start with the U.S. So our view on the demand in the U.S. on wind and solar is clearly unchanged. But adding to that, it's unchanged on a very high level. So I reported previously that we see strong interest in PPAs or signing PPAs if you have projects ready to be built, so with a clear COD date, and that hasn't changed.

With respect to the U.K., I mean, look, when we discuss internally the attractiveness of countries, for us, it's not so much looking at the current regulatory regime, but more looking what is -- what are the fundamentals of the market. So is there a demand for our product? And when I look at the U.K., I mean, what we learned from AR7 was that apparently, the government did an investigation to see at which price Offshore Wind is competitive relative to other technologies. And they cleared the projects that were below the threshold, which means that Offshore Wind at the prices we secured our CFDs is attractive for the U.K. macroeconomic. And that is, for me, a strong confirmation, and that also gives me confidence that those projects can successfully be delivered.

And therefore, I mean, obviously, at the point of FID, you will take a close look at what is the current regulatory regime for sure. But you see me very confident on those projects that will bring them forward and also take the decision to the investment decision on those projects.

And we'll now move on to our next question from Harry Wyburd of BNP Paribas.

So 2 for me. So firstly, sorry, Michael, I'm going to come back to the guidance. So sorry to infuriate you by asking about this again. But I think, so far, you've been very confident that you're happy with where you are on an underlying basis. So fully noted -- also fully noted you don't want to talk about Trading. But is there -- can you just give us some color on what makes you confident? Is there something else in another division that you expect to go better in the last 3 quarters? I think we're just looking for something to add a bit of weight to your confidence on the remainder of the year?

And then the second one is on the German capacity market. So pay as bid, and am I not wrong that given -- if we start with the supposition that you have a cost advantage because you lock your turbine build slots early, isn't pay as bid kind of worse than pay as clear because doesn't that mean you don't benefit from another bidder without the turbine build slot pushing the price up? And is pay as bid actually compatible with the EU rules because I thought that the EU rules sort of enforce pay as clear. So just, has the IRR outlook for that gone down as a result of pay as bid?

Yes, Harry, I mean, let's start with the guidance. So if I look at the current year, the segment where the first quarter was poor is Trading. And as I said, we are confident that throughout the year, we will recover that and therefore, also confirmed the full year guidance as we put it forward. So that is clearly the segment which now in the course of the remaining 3 quarters should outperform compared to the others. The rest is pretty much in line. So that's -- so that comes back to Ahmad's question. So that's for me, business as usual. So if we deliver business as usual, we are fine within the guidance. And then obviously, on top comes the one-off from FlexGen.

Concerning capacity markets in Germany, I mean, first, let's come from the last question. I think our return expectations will be met, to be very clear. I also wouldn't bid into the auction with too low ones. So no change here. So what's the topic with pay as bid? I mean, in principle, pay as bid is not necessarily negative. I think the big risk with pay as bid is that you get winner's curse -- winner's curse that some people kind of -- I don't know, bid in here for tactics and then later on lose out. So it's more how it's kind of the competitive landscape. So therefore, for me, yes, I think we do have competitive projects at hand, and we also will bid them with the right return expectations. And that also should bring us ultimately into the right position. So from that perspective, no concerns. Pay as clear, as I said, it avoids winner's curse. So I would clearly have preferred that. The EU put that forward as a recommendation if you want to get that quicker proposal. But it doesn't kind of change it big time.

We'll now move on to our next question from Wanda of UBS.

Wanda Serwinowska, UBS. Two questions from me and one clarification, if I may. Can you talk, Michael, a bit about CCGT's profitability of CCGTs, especially in the U.K. and the Netherlands in Q1? Because when we look at the volumes that you produced from CCGTs in Q1, volumes went down and you mentioned unfavorable power price, if I'm not mistaken. So that would be question number one.

Question number two is around the general capacities in Germany for new existing assets. I'm talking about T-2 and T-4. Is it something big for RWE? And just on Harry's question, you said that your return expectations will be met on new CCGTs, but what they are? Can you quantify them?

So let's start with the CCGT profitability. So in Q1, it was more -- I mean, obviously, it's a year-on-year comparison you're looking at. And what we saw last year was especially in the U.K., as we said, it was a low wind year. And therefore, we had a much higher utilization of the gas fleet. And this year, we see normalized winds and therefore, also the effect on the CCGT is the opposite. So it's more a volume effect that we're seeing, and that is also, to some degree, impacting the Netherlands. So no negative pricing effect here. So that's a volume effect.

Second one on the return expectations, we haven't guided on the return expectations of the projects. Look, in the end, the way how we kind of stagger it, I mean, clearly, I think we said the range is roughly between -- I think it's like 8.5% and 12.5%. That was the range we previously guided for FlexGen and so for batteries and for flexible generation. Now you can say, look, this is Germany. So therefore, it should come with a lower WACC. And then the decisive factor is what do you assume, how much of the income of that asset is driven by regulated income and how much is merchant. And as I always stated, given the uncertainty, I would rather see a higher share of capacity payments in the business case, that should also lead to a higher regulated share, which probably also then leads to kind of something more in the lower half of that range that are guided. But that's just kind of a rough indication.

And if I may, but when you issued the guidance back in 2023, interest rates were different, right? So there should be some -- so your 8.5% should be a bit higher these days?

I fully understand that you would be very interested to get a clear answer from us. But you also need to understand that this is one of the decisive factor for our bidding strategy. So I think the key element is what Michael has said that there are drivers which are very similar across all projects that we do, which is the base rate in the country, which is the technological risk, which is the market risk. And those are the factors which we consider in setting the return requirements and ultimately placing our bid in the auction.

Okay. And just on CCGTs, apologies. How should -- how do you compare the current profitability in the current energy crisis to the one in '22, '23? How they are different? Because you are not printing hundreds of millions of euros, right? Any comments?

I think there are 2 fundamental differences between the current energy crisis and the energy crisis we saw in 2022. One is if you -- I mean, the volume that is missing to the gas market is about the same magnitude. You can argue this time since it comes on top. But the big difference is, in 2022, it was volumes into Europe that were missing. And since we didn't have in Europe sufficient import capacity, we had to balance the market within Europe. This time, it's volumes -- or molecules missing in the global markets, and you also have global markets to rebalance. And what we currently see is that the major part of the rebalancing or demand reduction is done in Asia by fuel switching or by shutting down demand. And therefore, the impact on gas prices is significantly lower than we saw in the crisis in 2022. Secondly, if you recall, in the energy crisis 2022, it was not only gas, but it also was French nuclear availability that was very low, and we don't have that issue this time. So it is different.

And we'll now move on to our next question from Peter Bisztyga of Bank of America.

Two quick ones from me, please. First one, just wondering, are you in any conversations or are you planning on being in any conversations with the U.S. administration vis-a-vis exiting your U.S. Offshore Wind leases?

And then the second question, actually on your lignite business. Just interested to hear how the day-to-day sort of profitability of that business looks now versus your expectations kind of back in March given the commodity and power price environment that we're in?

Yes. I mean, first on the U.S., I mean, we always said that if we are not allowed to build the Offshore assets where -- and we paid for the leases, there should be some form of compensation in the long run. And that position still holds, and the rest I can't comment on.

On lignite, you're right. I mean, on lignite, you have -- obviously, in the front positions are hedged. But what you see currently with elevated power prices and lower CO2 prices, you see additional hours in the year coming into the money. And these positions, we also do hedge, and that also provides upside to the earnings of our lignite business.

And we'll now take our next question from Rob Pulleyn of Morgan Stanley.

So may I ask on data center exposure, if there's any update on these other deals that you've been working for? Or any color you can share from PPA negotiations with hyperscalers and other data center offtakers?

Secondly, I know there was a comment or a question on market intervention earlier, and we've spoken a lot about the U.K. From your perspective, do you see any risk of power market intervention in Germany?

And lastly, if I can stretch it slightly, we noticed the Offshore CEO Sven is looking to not extend his contract come September. If you could just talk about the succession and the transition plans there?

Yes. So data center, I think, Rob, your question refers to Europe. because on the U.S., I already answered to that question previously. So yes, no, we are making good progress there. And we also see a continued good interest for offtake by data center companies. But as always, we would only communicate once the deals are done. I mean you saw a PPA that we signed with Amazon at the beginning of the year, and I would expect also more to come there.

Market intervention in Germany, I don't foresee. Also because -- I mean, we discussed that just in the context of Wanda's question. I mean, if you look at power prices, they haven't risen so significantly in the latest months simply because, yes, you saw an uplift on the gas side, but there was also an offsetting effect on the CO2 price side. So effectively, prices have gone up, but so far to a limited extent. So therefore, we don't see that currently.

Last one, Offshore Wind. Yes, I mean, first of all, Sven decided to not prolong his contract. We agreed with him that he would do -- keep an advisory contract for us. And so we still continue to benefit from his deep expertise. So transition will happen in autumn. And I mean, you know that we have a very strong team in Offshore Wind. So Gunhild as the CFO, Tobias Keitel will take over the CEO role and Thomas, who is leading the operation. And Julian will step up into the function of -- that Tobias has done so far. Julian is actually the one who ran all the big Offshore projects very successfully on time and on budget.

And so he just moves up in hierarchy, but I think he stays in kind of his area of responsibilities, and we are very happy with his performance. And finally, Tobias. Tobias joined, I think it's a year ago. He previously has been CEO of Voith Hydro. So a very experienced manager in the energy area, so on the supplier side. And yes, we believe that this is a very strong team that definitely will continue the good delivery and performance of the Offshore segment going forward. So we are -- even though we are -- obviously, we -- there is some tears with Sven leaving, but there's lots of confidence in the new team going forward.

And we'll now take our next question from Louis Boujard of ODDO BHF.

Maybe we are going a bit more into a detailed question. I apologize for that. Just regarding the economic of the long-term vessel charter that you mentioned into the Offshore Wind performance as a positive effect. Could you just provide a bit more granularity on what it is? What volume are talking about? And is there any offsetting element that you've been taking into consideration from this specific line?

And also still on the Offshore Wind market, if you could provide your assumption, which are embedded for the full year '26 guidance regarding the commissioning timing and the increasing load factors of the Nordseecluster and Sofia that is going to fuel by the end of the year?

Next question would be on the Flexible Generation, EUR 332 million positive Eemshaven compensation, which is good, but the underlying is not that bad neither, notably the hedge and the capacity market is quite good as well. How shall we think about the evolution of this performance in the rest of the year and maybe also regarding '26, '27 winter considering the current market situation?

Yes. I just realized one thing when I talked about the management team, I missed on Ulf Kerstin, so both the Chief Commercial Officer, who is in both boards in Trading and in Offshore. Obviously, he's also staying and providing continuity on that topic.

Yes, to your question, leasing, that's obviously a detailed IFRS question. So what happens here that the ships, the construction ships, they are activated in the balance sheet and then are depreciated over their -- over the lifetime of the contract. So that's the negative effect in depreciation. The positive effect comes either if we use the ships for our own projects, because then we book an earnings. But at the same time, we then activate that or we capitalize it in the projects, and that is leading then to a positive EBITDA contribution, offset by the depreciation I just mentioned. Or if the part -- or ship is not used by ourselves, but we rent it to somebody external, obviously, you would have the income from the renting to somebody external, which would show up in EBITDA, and then would be offset by the leasing. So effectively, it nets out in EBITDA -- in EBIT to 0, and it's just an accounting treatment.

Regarding projects, Nordseecluster, Thor and Sofia, yes, you are right. So we will see a ramp-up both in capacity and also load factors as we go through the year, quicker now on Sofia and then Thor, and Nordseecluster is a little later because turbine installation is only set to start now in summer.

Last one on Flexible Generation. So I would say no news on the rest of the year, so pretty much in line. And then for the later years, what you see is, obviously, we will see -- especially end of '27, '28, we will see commissioning of new batteries that will contribute to more earnings, and we also see a ramp-up in the capacity payments in the U.K. that also will lead to additional income. Obviously, all included in the guidance as we have given so far in the beginning of the year.

I can imagine. My question was more if there is any change into the merchant aspect of the profitability, but you clearly answered that, partly, not necessarily.

We'll now take our next question from Olly Jeffery of Deutsche Bank.

Two questions, please. The first one is on credit rating agencies and the leverage that you seek to target, the 3 to 3.5x. Have you start to have more contracted revenues? And in the U.K., where potentially you'll be having voluntary CfDs or even further contracted revenues, do you think that there's a stronger and stronger argument for the leverage factor that RWE needs to target to maintain its credit rating could be increased, and therefore, you could have higher balance sheet headroom by 2030?

And then the second question, not really sure, with the German gas auction. Will the result of that be immediately following when the auctions are held? Is that the intention?

So let's start with the last one, the German auction results. I have to admit, I don't know. But Thomas or his team can clearly follow up on this one. But I would expect them -- I mean, it should be pretty quickly, I mean, definitely before the second auction. So if you have been successful. But we need to follow up on this one.

Second one on the rating, yes, I mean, we guide 3.0 to 3.5x. And you can imagine that we're having discussions with rating agencies along the similar lines. Clearly, with further decarbonization, our risk profile is improving from an ESG perspective with more contracted income. We are also further derisking our cash flows going forward, and also a more diversified portfolio should help there. So there is a strong argument from our point of view that, over time, we should be allowed for the same rating to increase our leverage. But at the same time, these are obviously the conversations with the rating agencies. And as I clearly stated, my clear target is to keep our current rating, so the strong investment-grade rating. I would always wait for those conversations with the rating agencies before we go for significant higher numbers. And that's why also, when we laid out the plan, we put -- we positioned ourselves at the more conservative lower side.

Secondly, I would also argue, I think in the current situation, it also has proved that it's good to have a solid balance sheet. And therefore, actually, I'm also pretty happy with the current setup. Having said that, if you talk especially in the later years, 2030, yes, that would be a good argument if we can increase that. But first, we need to convince the rating agencies, and then we'll also try to use the rating headroom.

And we'll now take our next question from Piotr of Citi.

So I have 2 questions, please. So the first one, I wanted to go back to a question about the data centers where you said you're making a progress. Can you give us a bit of indication what you see for the site values on the comparable basis with the bid? So if you were to sell and negotiate the site sale of a similar size today, would the price be higher or lower? And what would it be a lot higher? Or like can you maybe give us a maybe small indication where the values of such assets are?

And the second question, maybe I'm completely wrong, but going into the gas capacity auction in Germany, is the design preferred for a CCGT? Or do you think we could be surprised by a more project from the open cycle gas turbines? And I understand you have a CCGT slot and therefore, somebody with a much lower CapEx could come ahead of you or maybe could change the way the auction is -- kind of the outcome of the auction. What's your understanding on CCGT versus OCGT into this auction?

Yes. So first question, you asked for a small indication, but I can't give you any indication because, I mean, clearly, that is -- these are negotiations, and I can't reveal numbers on this one.

I'm asking more about where the market is, like is it hotter or less hot?

Yes. But that's to say, I mean, ultimately, this is not a liquid market where you can look at the screen. That is individual negotiations, and I can't reveal numbers on individual conversations we are having.

Second one on the capacity auction. Well, I mean, first of all, the 3.0 of capacity that we want to build is both. So it's inclusive. We have reserve capacities for 2.4 gigawatt of CCGTs, but also 0.3 gigawatt of OCGTs. And therefore, I would also expect both technologies to be in the auction.

In the end, it's a question of the business case, yes. So what is -- I mean, what is the relative CapEx of the 2 of them, and then you need to look at what do you assume as merchant income. I mean, clearly, a CCGT will have higher merchant income in the front of the period because you will see more hours of them operating. OCGTs will have less hours because they have higher dispatching cost. But that then ultimately goes back to what are your assumptions on future prices. And again, that is also something which is competitive information, which we don't reveal before the auction.

And we'll now take a follow-up question from Alberto Gandolfi.

It's basically 2 parts follow-up on organic growth. The first one is that looking at Offshore, you seemed to have in the first quarter nearly achieved the year-on-year growth in million euros that you had for the year, so about EUR 300 million. And load factors, April, May seems to have been all right. Can we conclude, therefore, that Offshore guidance is conservative, you perhaps should be more towards the top end?

And the second part is just a clarification. I understand you saying in the past that the first 6 months of last year, you didn't take much FID in Onshore in the United States because of what was happening on tariffs on the IRA. Does it mean we should expect very H2 or maybe Q4 skewed Onshore additions for this year, which may perhaps mostly contribute to '27. So there may be a blip in '26, but no change to '27. Is that the right way to think about it?

Yes. So I'm looking for Thomas to confirm that. But definitely the FID -- the CODs will be tilted towards the end of 2026. So effectively, you see that, in the first quarter, we only had a low number of new commission assets. So more to come as we progress through the year very clearly. And kind of the dip out of stopped FIDs last year between April and October shouldn't have an impact on '27. So that's the '26 effect you rightly referred to. And Thomas is nodding, so I was right in my answer, so that's good.

Secondly, on Offshore, look, I mean, I explained to you that we are confident with the guidance, that nothing has changed here. So I will also leave that with the comments for Offshore.

And we'll now take the next follow-up question from Peter of Bank of America.

So maybe you had another guidance-related question, but looking at your FlexGen business, I guess, kind of in contrast to Offshore, if you strip out the gain, it was a pretty weak quarter, because of low load factors that we discussed earlier, but in your sort of slide pack, you kind of talked about higher hedged prices for the rest of the year. So I guess, first of all, was there any impact from having to sell out of hedge positions at a loss in the first quarter? And secondly, are those better hedged prices, kind of evenly spread through the rest of the year, or are they kind of back-end loaded? So any kind of color on that would be helpful, please.

Yes. No. So first of all, it's correct that there are higher hedge prices compared to previous year, but there's no specific pattern. I mean you see in general that typically the Q2 and Q3 results are slightly lower than Q1 and Q4, simply because you have less solar production in those months. But no, no specific pattern here.

And nothing that has changed compared to when we spoke about it in March.

Yes.

Thank you. There are no further questions in queue. I will now hand it back to Thomas for closing remarks.

Great. Thank you, Laura, and thank you, everyone, for dialing into our call today. If there are any follow-up questions, feel free to reach out to any person of the IR team. And apart from that, looking forward to see you at conferences, road shows, reverse road shows and latest, with our half 1 results in August. Have a great rest of the day. Bye-bye.

Thank you. This concludes today's call. Thank you for your participation. You may now disconnect.

Great. Thank you. Have a great rest of the day.

Ladies and gentlemen, good afternoon from Essen, and thank you for joining RWE's conference call. Today, we are reporting on our 2025 performance, and we're providing a strategy update for the period 2026 to 2031.

Our CEO, Markus Krebber; and our CFO, Michael Muller, will first guide you through our presentation. And then we'll start the Q&A session.

And with this, I hand over to you, Markus.

Yes. Thank you, Thomas, and a warm welcome to everyone here from the RWE headquarters. Today's energy world is one of high growth and huge opportunities, but also one full of challenges to deliver multibillion investments. We experienced ongoing geopolitical tensions, evolving energy policies and regulation as well as supply chain and tariff uncertainties. We, at RWE, have the capabilities to navigate this environment and to capture the opportunities ahead of us. And in 2025, we delivered again.

We remain focused on our key strategic milestones and executed on our strategy, and we achieved the financial performance at the upper end of our guidance. Our investments focus going forward will be on highly attractive growth opportunities in the U.S. power market and German flexible generation.

For the period '26 to 2031, we plan to invest net EUR 35 billion, and these investments will lead to exceptional earnings growth of 12% annually until 2031. Furthermore, we are increasing our dividend growth target. We will grow our dividend by 10% per annum.

Let's take a closer look back at 2025. We delivered a strong financial performance on the back of the robustness of our integrated portfolio. Adjusted EBITDA stood at EUR 5.1 billion, reaching the upper end of our guidance. Adjusted net income came in at EUR 1.8 billion or EUR 2.5 per share, also at the upper end of our guidance.

Driven by strong progress in partnering, our leverage ratio was well below our guidance range at 2.1x. This once again underlines our prudent balance sheet management. We delivered our strategic priorities in '25 as well. We added 2.8 gigawatt of new capacity to our generation portfolio, mostly in the U.S. We took further FIDs and currently have more than 10 gigawatt capacity under construction across all technologies and regions.

In the U.K. auction round 7, we were awarded 6.9 gigawatts of gross capacity. These CfDs will secure additionally high attractive offshore growth. The 20-year inflation-adjusted CfD starting at GBP 91.2 per megawatt hour will deliver long-term secured cash flows. We made prudent investment decisions at attractive returns.

On average, weighted on CapEx, the IRR of our 2025 FIDs is 9.8%. Our EUR 1.5 billion share buyback program is well underway. At present, we have bought back 34 million shares at an average price of EUR 36. We will finalize our current share buyback program by June of this year.

One key pillar of our investment strategy is attractive partnerships. And in '25, we successfully entered into new valuable partnerships. We sold 49% stake in our Danish, Thor, and German, Nordseecluster, offshore wind projects to Norges Bank Investment Management. And we entered into a partnership with Apollo to secure funding for our grid expansion at our 25.1% stake in Amprion.

For our Dogger Bank South offshore projects, we continued our long-standing partnership with Masdar. Now we have also secured CfDs in ARM. And in January '26, we announced a partnership with KKR for our Norfolk Vanguard East and West projects. We will carry out these projects in a 50-50 joint venture. This includes a project financing structure that will already lead to positive cash flows for us during the construction phase. In 2025, we delivered on all of our strategic priorities.

Let's now focus on our future plans and how we will continue our successful journey. The fundamentals for our business are fantastic. The age of electricity is there. Power demand will grow. For Europe and the U.S., the International Energy Agency assumes continued power demand growth. Net expected load growth in both regions is above 10% until 2030 alone.

Key drivers are electrification in sectors such as transport, heating and industry as well as data center and AI growth. This results in substantial investment needs for additional power generation capacity in all our core markets and our core technologies. Renewables with low LCOE and the short time to market, battery storage to bring production profiles in line with demand and flexible gas generation to complement the power system with on-demand generation and backup capacity.

Policymakers are now fully aware of the investment needs. Much of the necessary clarity to facilitate the urgently needed investments is there. We at RWE are set to capture the opportunities ahead of us.

First, we have a strong portfolio. Our integrated generation portfolio of renewables, storage and flexible gas is the right setup for today and going forward. We have developed a diversified pipeline across regions and technologies, which will enable us to select future growth investments. And our existing sites allow us to head start the development of projects and to create additional value.

Second, we have excellent capabilities. We have best-in-class engineering skills to develop, construct and run generation assets. Our proactive supply chain management allows us to mitigate the risk of tight supply and tariffs. We run an in-house commercial platform that enables us to extract the full value of our asset fleet and deliver superb customer solutions. And our strong balance sheet provides us with a high financial flexibility. This is a key advantage in our capital-intensive business. It enables us to adjust our investments and farm down program according to market conditions.

And third, we have a proven track record. We have executed all of our major projects on time and within budget. We have continuously delivered and even exceeded our earnings guidance during the past decade. And we have continuously reduced our emissions in line with the 1.5-degree pathway.

Let's get now specific on our investment plans. We will invest net EUR 35 billion in the years '26 to 2031. Our new investments will generate returns based on our average target IRR of more than 8.5%. These attractive investments will deliver exceptional EPS growth of 12% annually until 2031.

In 2031, our adjusted earnings per share will be at around EUR 4.4. Our investment program will be focused on our key growth opportunities. In total, we will add 25 gigawatts of net capacity. Compared to the previous plans, our offshore net cash investments are being reduced due to the partnering and project level financing.

On the other hand, our investments in U.S. power generation are being increased, driven by the U.S. market attractiveness. We maintain flexibility in our investment program. Hence, we are able to adjust capital allocation as market conditions evolve.

Share buybacks also remain an option in future depending on the market environment and investment returns. We will also maintain our balance sheet discipline. We will stay at the lower end of our leverage range of 3 to 3.5x net debt to adjusted EBITDA.

Let's have a closer look at our specific investment plans, starting with the U.S. The U.S. power market has very strong fundamentals. Power demand growth is high. According to the IAA, demand was up by almost 3% in '25 year-on-year. Driven by electrification and the build-out of new data centers, demand is expected to continue to grow in the coming years.

Driven by the rapid power demand growth, technologies with the fastest time to market have a clear advantage. New solar and wind assets complemented with batteries and gas generation. Demand for PPAs at attractive price levels is strong.

OBBB provides regulatory clarity about the application of safe harbor tax credits until the end of this decade. For our build-out program, safe harbor tax credits will not be a constraint. Even in this highly attractive market, we will neither compromise on returns nor on risk management. We will continue to make investments based on our strict investment criteria. Projects are only brought forward to FID, if all federal permits are in place. relevant tariff risks are mitigated, offtake is secured and tax credits are safe harbored.

From 2026 to 2031, we will invest around EUR 17 billion net, adding 9 gigawatts of net capacity. This also includes the first megawatts of peaking gas capacity by the end of the decade. We are expanding our U.S. presence with flexible gas generation. We will focus on markets with high power demand growth, PJM, MISO, ERCOT, and WECC. These markets are facing data center-driven load growth that represents a massive share of their current peak demand.

We are already present in all of these markets with a strong renewable portfolio, excellent market knowledge and secured grid interconnections. We will now leverage this position. We will organically grow flexible generation as a complement to our renewable assets. Currently, we are developing 15 projects with existing grid connections. Our goal is to take the first FID this year and have the first megawatts operational by the end of the decade.

Let's now turn to the German market, which also looks very promising for future investments. A study by the German grid Agency has identified the need for additional 22 to 36 gigawatt of firm and flexible capacity. Hence, we are facing significant investment needs.

New assets will complement intermittent renewable power generation with peaking and backup capacity. The German government has taken the necessary steps and will introduce the capacity market in 3 phases: 12 gigawatt of new assets, which we expect to be auctioned by late summer this year with COD in 2031 at the latest. Additional technology-neutral capacity market auctions in '27 and '29 will also include existing assets.

And finally, a comprehensive capacity market starting for delivery in 2032, in line with EU guidance for capacity markets. And we are well positioned to capture that opportunity. We have 3 gigawatts of ready-to-build gas projects with 2.7 gigawatts of secured turbines, and we can do more. We have 1.6 gigawatt of battery projects under construction in Germany.

And in addition, we have 2 gigawatt of battery projects in advanced development with secured grid connections and COD until 2030. In total, we plan to invest around EUR 9 billion net between '26 and 2031 in German flexible generation and will add 6 gigawatts of net capacity.

Moving on to offshore. Our offshore construction program is well underway. Currently, we have 3.1 gigawatt of projects under construction. This includes 100% of our Sofia project in the U.K., which we plan to sell down at a later stage. All of our major projects are within budget and on schedule to meet our targeted CODs.

A key part of our U.K. offshore wind pipeline is secured with attractive 20-year inflation-linked CfDs. In total, we secured 6.9 gigawatt gross and 3.5 gigawatt pro rata capacity in round 7 of the U.K. auction. Our future development activities are focused on our core offshore wind markets, the U.K., Germany, the Netherlands, Denmark, Belgium, Ireland, Japan and Korea.

Future investments in offshore wind projects require secured offtake and the bankability of the investments. We are confident that the regulatory regime in all our core offshore markets will be adjusted accordingly over time.

Net cash investments will only be around EUR 2 billion net. Partnerships and project finance will cover most of the investment needs going forward. Until 2031, we will add 5 gigawatt net capacity to our portfolio.

Our onshore wind and solar investments outside the U.S. are focused on markets with strong growth potential and attractive offtake regimes. We are exiting markets that do not fulfill our requirements. And we have the flexibility to shift investments among our core markets to navigate the regulatory environment as they evolve. In total, we will invest EUR 7 billion net and add 5 gigawatts of net capacity until 2031.

Load growth, especially from data centers is not only a key driver for power demand, it has also changed the fundamental value of the idle infrastructure we own. For data center companies, grid connections and land conditions are key aspects. Grid access is a true bottleneck. We own more than 30 potential locations in our European core markets with currently idle infrastructure. This is an additional potential for value creation.

From this portfolio, we have currently 10 sites in advanced development. We have either secured or applied repurposed grid connection with a total of more than 3 gigawatt. These sites are located along the so-called Blue Banana, Europe's megalopolis characterized by high population density and significant industrial activities. Based on our excellent capabilities, we are able to offer a broad range of solutions, energized land, which will include predeveloped land connected to the grid, ready to sell or lease to data center companies. Where feasible, we will complement this with clean power supply. And we can even go a step further and provide on-site power generation, backup power or energy management solutions. Any upside from these projects would come on top of our earnings guidance.

Let's wrap it up. Our investments will deliver growth in capacity, cash flow and earnings. In 2031, we will operate 65 gigawatts of generation assets that are well diversified across technologies and regions. In 2031, we will generate EUR 7.5 billion in operating cash flow, and we will deliver EUR 4.4 earnings per share.

RWE offers a highly attractive investment opportunity. We have continuously delivered strong project execution and financial performance, and we will continue to be disciplined with our capital allocation. We will maintain our strong balance sheet. Our leverage ratio will stay at the lower end of our guidance range. This provides financial flexibility.

Our portfolio will generate a robust cash flow from our existing business and attractive returns from new investments. We will deliver exceptional EPS growth with a 12% CAGR until 2031 and high earnings visibility. And finally, we will continue our strong focus on shareholder remuneration. We have increased our dividend growth to 10% per annum.

Thank you for your attention so far. Michael will now guide you through the financial details. Over to you, Michael.

Yes. Thank you, Markus, and good afternoon also from me. We outperformed our 2025 financial targets again. Adjusted EBITDA stood at EUR 5.1 billion, reaching the upper end of our guidance range. This was also driven by the sale of a data center development project to a hyperscaler in the U.K. and positive earnings contribution from Amprion.

Our adjusted financial result improved due to lower financing costs from earlier proceeds from farm-downs. Adjusted minority interest were higher than expected. This was driven by our partner share in capitalized interest and a strong contribution from U.K. offshore wind in the fourth quarter. Adjusted EPS stood at EUR 2.48, reaching the upper end of our guidance range.

Let's now look at future earnings development of our business. Our investments will deliver exceptional earnings growth through 2031. The EBITDA CAGR will be 12%. And in 2031, our earnings will be well diversified. Roughly 50% of our EBITDA will be generated by the onshore wind and solar business. The other half is roughly split between offshore wind and flexible generation. Our plan is based on forward prices of mid of February, our long-term commodity assumptions and a high share of contracted margins.

Since the beginning of March, commodity prices in the front years have increased substantially. This is an upside to earnings for our generation fleet. However, our trading business had a weaker start into the year.

Let's now take a look at offshore. Offshore adjusted EBITDA will grow on the back of commissioning of new assets. For 2026, we assume adjusted EBITDA to range between EUR 1.55 billion and EUR 2.05 billion. The commissioning of Sofia in September this year, the project will fully contribute to our earnings.

In 2027, further CODs will follow. Our German Nordseecluster A and our Danish project, Thor, will commence commercial operation and fully contribute to earnings.

In 2031 offshore earnings will increase further as more projects will reach commercial operation. This includes OranjeWind in the Netherlands in 2028 and Nordseecluster B in Germany in 2029. By the end of the decade, we will start commissioning of our AR7 projects.

For the Norfolk projects, we assume at equity consolidation, hence, we will -- they will only contribute in adjusted EBITDA with their share in net income. Until 2031, several of our existing projects in the U.K. will phase out of the ROC system. Hence, our 2031 target also reflects lower margins from existing assets. 2031 adjusted EBITDA in offshore will range between EUR 2.15 billion and EUR 2.65 billion.

Moving on to onshore wind and solar. The increase in earnings is mainly driven by organic growth of wind, solar and battery projects. In addition, we'll have earnings contribution from U.S. build and transfer business.

For 2026, our adjusted EBITDA will range between EUR 1.75 billion and EUR 2.25 billion. For '27, adjusted EBITDA reflects the slower pace of investment decisions in the first half of 2025 in the U.S. This is driven by the regulatory uncertainty.

Beyond 2027, we anticipate further growth. In the U.S., we'll deliver our pipeline of safe harbor projects. We also expect earnings contribution from our first gas assets in the U.S. Similar to offshore, several onshore wind and solar projects will phase out of their support scheme by 2031. By 2031, EBITDA is targeted to range between EUR 4.2 billion and EUR 4.8 billion. From '26 to '31, this implies an earnings CAGR of 18%.

Let's now have a look at flexible generation. In 2026, adjusted EBITDA is expected to range between EUR 1.2 billion and EUR 1.6 billion. This is mainly driven by the absence of the book gain due to sales from a data center project in the U.K. last year and increasing contracted capacity payments in the U.K.

In '27, earnings development is largely driven by a further increase of secured capacity payments in the U.K. From 2027 onwards, we will also commission battery assets that are already under construction. Until '31, we expect to grow earnings on the back of new battery and new gas assets in Germany. However, the new gas assets are subject to successful German capacity auctions this summer. We assume adjusted EBITDA in 2031 to be between EUR 1.9 billion and EUR 2.4 billion.

Our earnings will lead to a strong adjusted operating cash flow. Average adjusted operating cash flow from '25 to '27 amounts to EUR 5 billion. Our investments will further grow the cash flow by 50% to EUR 7.5 billion in 2031. This excludes the utilization of mining provisions as these are fully covered by our 15% stake in E.ON.

In 2031, 75% of our cash flow will be contracted. We are strongly committed to a strong balance sheet. We will maintain our solid investment-grade rating. At the end of '25, our leverage ratio stood at 2.1x, driven by the cash inflow from the partnership with Apollo. From '26 onwards, we expect our leverage to move closer to 3x as we continue to invest. And we will continue to stay at the lower end of our 3 to 3.5x net debt-to-EBITDA range. We aim for a steady long-term dividend growth.

For '25, we confirm our dividend target of EUR 1.2 per share. And on the back of our strong earnings development, we will increase our annual dividend growth to 10%. For '26, we'll target a dividend of EUR 1.32 per share, representing a payout ratio of approximately 50%.

Let me conclude. Our EUR 35 billion investment program will lead to exceptional earnings growth. Our adjusted EBITDA and EPS CAGR is 12% until 2031. We remain firm in our commitment to financial strength and maintaining our strong balance sheet. And we're committed to attractive shareholder remuneration. We will grow our dividend by 10% per annum.

And now let me hand back to Thomas for questions.

Thank you, Michael. Thank you, Markus. We'll now start the Q&A process. Operator, please begin.

[Operator Instructions] We will now take our first question from Alberto Gandolfi of Goldman Sachs.

I'll stick to the 2-question rule. Very interesting strategic update. Thank you for that. I guess, the first question is asking a little bit to cross-check the calculation and the rationale. So you have achieved a 10% IRR on additions in '25. The power demand outlook is very solid. Competition in renewables is probably not as strong as it was 2, 3 years ago. So can I ask you what is the rationale for sticking to just a bit higher than 8.5% IRR, which is a little bit better than the previous plan? And am I right in thinking that if you were to remain at 10%, how much of the EUR 35 billion CapEx is uncontracted? Is it EUR 20 billion, EUR 25 billion? So we're talking about $0.45, $0.50 upside if you were to stay at 10% IRR. This is just a sensitivity basically that I'm asking and rationale for it.

The second question is similar along those lines, but for FlexGen. I was going to ask you how much really power demand have you assumed? And -- what happens if power demand is like an extra 1 percentage point higher? Let's say, you assume 2. What happens if it's 3? What happens to your investments in peakers? What happens to FlexGen, in particular, existing assets, FlexGen in U.K. and Germany? Is there any way you could quantify? Is it EUR 200 million, is it EUR 300 million before taxes incremental? I'm just trying to see how many contingencies you put in 2031.

Thank you, Alberto. Always looking for upside. I love it. So first of all, I mean, you know us now for years, and the basis of our planning is always prudent planning. So of course, there are probably more buffer than upside, more buffers in the plan than hope. But we want to have an investment framework where we say, okay, if we do these investments, it needs to be valuable. What is the hurdle rate? And the average hurdle rate to have a valuable investment according to our cost of capital is 8.5%. And that's why we plan with at least 8.5%. It can be better.

The 2 biggest buckets of upside is U.S. projects and German gas plants where we have, I think, a very good position to get higher returns. But we don't want to put it in the plan because that is what we think not a prudent assumption. On the -- but we definitely strive for higher returns as we have also last time, I think when we had the intense discussion on returns, I said 1.5 years ago, now is the time to capture higher returns because the projects you can get through in a very competitive or challenging environment needs to have higher returns and that what we have delivered now. And that can continue, but you never know.

On the CapEx, what is committed, I would say probably 1/3 to 40% is committed and the rest is still open with, I mean, the U.S. projects in the later years and especially the German FlexGen investments. We have also a very prudent assumption on power demand. So we start with the current level of European, especially German power demand. And we had that discussion before. If we see for whatever reason, I mean, current situation with the energy prices probably even more challenging. But if we see an uptick of industrial power demand, which could easily be another 30, 40 terawatt hours a year, that would change the picture. But we don't want to speculate what that means in earnings today.

And our next question comes from Ahmed Farman of RWE.

Ahmed Farman from Jefferies. Michael, thank you for the plan. Really interesting. Two questions. Actually, Markus, just a very quick follow-up. On the 2 sources of upside that you highlighted, the gas plants in U.S. and potentially in Germany, could you specify sort of what sort of -- how much of the CapEx is already contributing to the earnings in 2031? And how much of the CapEx still sort of comes afterwards? Just trying to understand the sort of -- how much of the sort of the opportunity is already reflected in the 2031 EPS? And how much sort of potential upside could there be just because of timing effects and some of the CapEx spend comes afterwards? So that's my first question.

My second question is on the German capacity market. I think you mentioned technology-neutral auctions in '27 and 2029. Is that already part of the base case plan? Or is that also a source of upside as well? And if it is a source of upside, any indications you could provide on eligible capacity for RWE would be helpful.

Yes. I think on the unproductive CapEx at the end of the planning period, Michael will give you an update. Just to clarify one thing, Ahmed, I think the upside on the earnings is not so much on the U.S. gas side because that will be maybe a couple of hundred megawatts by 2031, if we are now successful with the organic development. It's more on the renewable side because we have seen very strong returns with the recent FIDs we have taken.

On the capacity market in Germany, we have incorporated the build-out our share of the first 10 gigawatt of gas plants, it's going to be auctioned. We plan with 3 gigawatts there. We have not included in this plan yet any additional contribution in the potential capacity market from existing capacity. There's 0 in the plan.

Yes. And Ahmed, on the unproductive CapEx, I think EUR 9 billion to EUR 10 billion is a fair assessment. I mean, clearly, we have a higher rate of unproductive CapEx currently. As you know, there are lots of offshore projects that are just due to come online. So we expect that share to come down and also the sell-down to partners has contributed to a decrease, but I think EUR 9 billion, EUR 10 billion is a good run rate in the later years for our investment plan.

And our next question comes from Deepa of Bernstein.

So my first question is on U.S. gas. I think, Markus, you mentioned it's a couple of hundred. So should we think that the CapEx allocation for U.S. gas within that EUR 17 billion is fairly negligible in the scheme of things? And do you also have the equipment already sorted?

My second question is more on the energy crisis. I think, Michael, you mentioned that there is upside to the near-term numbers with the higher commodity prices. However, you said trading was off to a weak start. So just wanted to understand what are the dynamics going on here that impacts trading? Is it any specific position you have? And I did note that you have quite an unusually high open position for '26 in your sensitivity table. So EUR 10 million change for every EUR 1 change on offshore. Is it because you deliberately left the merchant noose of Sofia or any of the other under construction projects open? Because I would have assumed you would have been more hedged for '26. So just wanted to check whether there was anything strange going on in '26 on hedging.

Yes. Thank you, Deepa. I'll take the first one on U.S. You are right. I mean the CapEx until 2031 is low, definitely less than 10% of the EUR 17 billion more in the area of EUR 10 billion in the current plant. If we are successful, we can upgrade that, of course. But the plan is really here for the new development and existing sites to offer our offtakers also a 24/7 baseload band with renewables, batteries and gas. And we have many sites under development now where we have gas pipelines close by. So we clearly see an attractive growth case. We have not secured any equipment yet, but we don't see a problem for peakers and engines. CCGTs is different, but we plan only with peakers and engines here.

On the energy crisis, I mean, Michael said that the upside is not in. I think that's too early. I mean we need to wait and how things evolve. Let's hope that we see a de-escalation fast and also energy prices coming down. But I mean, we have made the sensitivities quite visible and transparent.

On the trading side, the traders more had the outlook of, I mean, the LNG glut coming and we are more conservative also on CO2 prices and then implicitly power prices, more or less an offset position to our asset position by chance. And that, of course, means on the one side, we have no upside from the current situation, but trading will be weak in the first quarter.

Yes. And just to your question, you're fully right. So the open position in '26 in offshore is mainly pre-COD income from Sofia, from Thor and from North Sea Cluster, which we typically don't hedge because, I mean, we are in the commissioning and you have some variability in those productions, and that's why we don't hedge them. Obviously, that has now the upside if prices stay at those elevated levels in the front years.

Our next question comes from Peter Bisztyga of Bank of America.

So first one, I was trying to actually figure out your sources and uses of funds basically between 2027 and 2031. So your guidance suggests EBITDA is going to increase by EUR 3 billion. So that would imply EUR 9 billion more net debt on your 3x multiple. I think operating cash flow guidance suggests maybe EUR 7 billion a year cash flow, then you've got probably, what, EUR 8 billion a year CapEx plus dividends plus Amprion funding. I don't know if that's fair, but that would sort of imply around EUR 1 billion per annum increase in net debt, so EUR 4 billion, 2028, 2031 rather than the EUR 9 billion in your plan. So all of that, the question is what's the EUR 5 billion missing piece? Or have I got something wrong in that math?

And then just maybe a quick one on the German CCGTs. The Federal Cartel Office seems to want to cap yours and everybody's market share at 10% in that auction. I'm not sure there's even people who could build CCGT quickly in Germany. So do you think the government will ignore the Cartel Office on this? Or how do you think that plays out?

Peter, let me comment on the first question. I think you mentioned all the right moving parts. But honestly, I believe now on stage is probably not the right thing to go to a model. So if you are fine with it, I suggest that we do a follow-up call to go through the numbers one by one. But in principle, you're right. I mean, we have strong cash flow generation. We're very clear on the CapEx numbers and there are a few other moving pieces like cash interest, cash taxes, working capital developments, but we can go through line by line, if you want to unless, Michael, you want to comment further?

Can I maybe sort of put the question differently then, which is simply, do you expect to be at that 3x by 2031? Or actually, is there a bit of buffer beneath that as well on your current plan?

No. So no, the plan clearly is based on a 3.0 leverage. As we said, that is obviously at the lower range of our guidance. I think there is potentially more upside if we want to leverage higher. But I think given the current uncertainty we see in the geopolitical arena, we feel very happy with a more conservative leverage target.

The second part of your question, Peter, was on the 10% restriction, which is discussed by minority voices in the debate. We don't expect that to come. I mean the argument is very strong. The German government has forced us to close, I mean, in the tens of gigawatt. They ask us to do this transformation in a socially acceptable way, 10,000 people involved. And now some people ask for a restriction of 10% so that we can only build 1 or 2 gigawatts that doesn't make sense. I mean our sites are the best ones. We need to employ the people for future business.

Actually, the old government had plans to give a bonus for those who were forced to close old units. So actually doing the opposite. I don't expect a bonus, but I also don't expect the 10% restriction. The argument that, that might be cheaper for the consumer is nonsense because, I mean, it's a competitive auction when the others are cheaper, they're going to win anyhow. I expect us to be successful in the auction with more than 10%.

I'm sorry, the next question comes from Pavan of JPMorgan.

Firstly, on the U.K. capacity market results we saw this week, would be great to hear some color from you on was this in line with your expectations? And how should we think broadly about the supply-demand balance into the 2030s for the U.K. in general and whether you think this auction is a signal that maybe things are less tight than investors may believe? And then my second question is on your sensitivity to CO2 specifically. Can you talk through how you think about CO2? And if we were to see any interventions that were to cap the CO2 price significantly below current levels, how you see the sensitivity to your earnings on that piece?

Yes, Pavan, thanks for the questions. On the first one, U.K. capacity market, we were not surprised by the auction result. That was more or less in line with our own expectations and analysis. We expect something similar also for the years to come in terms of supply-demand balance. That is why we have for 1/3 -- a bit less than 1/3 of the capacity have gone for 3-year contracts now, so locked in the current one -- current price level for 3 years. And I mean, in the earnings guidance, this assumption is baked in. CO2 sensitivity, I mean, now we need to combine both things, our core business and the lignite business, which still runs until 2030. It is -- the sensitivity is 0. So we are carbon neutral cash flow-wise from the open positions on the core business and from the lignite business.

My sense is from the ongoing political discussion that this energy crisis once more for Europe, which is a big importer of fossil fuels will change the debate of the dynamic. We need to find solutions for the energy-intensive business, but the investment signal to invest in electrification, low-carbon electrification to get rid of the fossil import dependency is now stronger.

And our next question comes from Wanda of UBS.

Wanda Serwinowska, UBS. Two questions from me. The first one is on the U.S. flex generation. Maybe I didn't catch, I think Deepa was asking, do you have supply chain in place? Can you talk about the revenue stack? Do you plan for these assets to be fully contracted or merchant? And any EBITDA to CapEx yield would be much, much appreciated. And the question number 2 is on the U.S. investment into the renewables. I mean, how much have you safe harbored for the capacity until 2031? What IRR absolute are you targeting? I think, Markus, you said that returns would be higher, so it will be above this 8.5%, but any ranges, any guidance, more specific numbers would be appreciated. And -- could you also give us a rough split of the new capacity to be added into solar, wind and batteries?

What was the last one?

Capacity split.

Wanda, thanks for the question. So on U.S. Flex, we don't want to build gas generation into the merchant U.S. market. So we want to combine it as a bundle with renewable battery and the profile and then sell it to the customers. So you should expect that not 100%, but like with renewables, we want to contract this for 10, 15 years plus. So the average target is 75% of the value needs to be contracted. And that is also then the case for the additional U.S. Flex investments.

On the renewable side, I mean, we said in the speech that, I mean, and the number is very high. we have more than enough safe harbor equipment to run through, I mean, the full lifetime of existing tax credits. We have done that strategically already in the last 18 months. So this will not be a limiting factor. We could do gross more and maybe utilize our safe harbor equipment by selling it to others. But this is for our investment plans, not a limiting factor.

You should expect that for the U.S. investments, given the high interest rate environment and other things, the return hurdle is higher. But we have -- I mean, the 8.5% on average is including the higher U.S. investments. But what we currently see with the strong demand and the good PPA prices, then you can achieve higher IRRs for U.S. investments. But of course, we don't want to give you the numbers. This is sensitive information. We will always tell you ex post what the FID returns are for this year's FID when we have done them. Why don't you go for it?

I'm happy to call Michael.

Yes. So I mean we talk about 9 gigawatts in U.S. So it's roughly 5 in solar and then 2 and 2 in wind, onshore and wind and batteries. So that's roughly the split.

And the supply chain in the U.S., do you have it in place for this 200 or a couple of hundred megawatts?

On U.S. Flex until 2031, a couple of hundred megawatts, I would say we are targeting something up to 500 megawatts.

On the supply chain, I think Markus already mentioned that, I mean, so especially the peakers that we plan there. So we don't see such a material supply chain issue, especially given that the time frame is rather towards the end of the decade.

Okay. And the last very ones -- the last one, EBITDA to CapEx for U.S. Flex, any guidance? I think in the past, you were mentioning 10% EBITDA to CapEx for the renewables, and that was very helpful.

Yes, it was less than 10% of the EUR 17 billion. It's more in the area of a bit north of EUR 1 billion.

I think, Wanda, you asked for the EBITDA yield of...

Yes.

If we give you the EBITDA yield, you can back calculate actually our return requirements, Wanda. So I think the last time we gave EBITDA yields for the onshore and solar business as a whole, I think we said we target 11% was the EBITDA, which we targeted then. And probably we'll leave it there unless you want to be more specific.

And our next question comes from Olly Jeffery of Deutsche Bank.

Two questions for me as well, please. The first one just is on Amprion and the assumption for the other section into 2027 with EUR 0 million EBITDA. I mean Amprion is very strong in '25, around EUR 350 million contribution, leading to EUR 150 million in the EBITDA. My question is, do you think there's upside to the EUR 0 million in 2027 because given the strong earnings growth in many German grids, I would have thought that there potentially is upside on that figure.

And the second question is coming back to German gas. I know you're talking to wanting to build 3 gigawatts, but previously, you've mentioned the potential to build 6 gigawatts with the sites that you have. Is that still the position you have today? So if the German was successful in the auction, do you still have the feasibility to increase that 3 gigawatt number towards 6 gigawatts, if you saw the opportunity?

Yes. So I take the Amprion question. Look, -- on Amprion, basically, it's a very stable business and the returns effectively grow by the investments you do. And so I mean, in the end, if we invest more, then that would also come with higher earnings, but I wouldn't necessarily talk about an upside here because that's really a long-term plan Amprion is executing. The effect we saw year-on-year was exactly that growth in regulated asset base.

On top comes an accounting treatment, and that is if they have there's a delta in accounting between the grid fees they charge and what they have to procure for system services. And if there's a deviation, that is a temporary timing effect. And that led to an increase in '27 -- in '25 that will unwind over the next 3 years. But apart from that accounting asymmetry, which should levelize over 2 or 3 years, I think that's a very prudent assumption on the growth. And I would stick to that as we have included that in the plan.

Yes. And then Olly, on the sizing of the German gas opportunity, it will come in 2 different buckets. One is the 10 to 12 gigawatt, which the German government wants to auction now this summer. And then later, a full-fledged capacity market, which also needs to facilitate additional build-out because the grid agency says we need at least 20. And for the first tranche for the first 10 to 12, we said the target is something around 3, because you cannot overdrive it. I mean, you also need to deliver. What I -- the last thing I want is a ambition plan and then we run into problems building the stuff.

So for the first, I would say, 3, maybe a bit more if we are successful in the auction. But later, definitely more can come, but that will not be covered by the 31 plan. So I think the 31 plan is quite firm. Later, we can definitely do more.

And our next question comes from Harry Wyburd of BNP Paribas.

So 2 for me. So first one, can we delve a little bit more into EU power market reforms. You touched on carbon earlier. But how do you think this ultimately ends? I guess you've got potential for reform of carbon. You've got also discussions about reforming the merit order works or maybe taking a leaf out of the Italian book and adjusting the way that gas behaves in the merit order. But what I'm interested in is what would an RWE outcome be? What would you do? Or what would you think Europe should do to get -- send the right investment signals but also control end-user pricing? So that's the first one.

The second one is on the leverage. So Michael, I got the point on the geopolitical environment, it's sort of good timing to have a conservative balance sheet plan, which I get. But you were probably planning this a little bit before Iran happened. So is there anything we should read into running lower leverage? Do you like having flexibility? Has your attitude to using flexibility maybe changed given, I guess, our attitude towards life has maybe changed since you last looked at things like M&A. So would you use some of that spare headroom? Was that a deliberate move to keep something back? And could we also think about that as maybe something that you could do that could be accretive beyond the current EBITDA and EPS that you're guiding to?

Yes, Harry, let me start with the second one. The first one is the most complicated question actually. I mean, we deliberately discussed it, and we said you don't know when the crisis comes. And when you are, I mean, maxed out on leverage and the crisis is there, it's difficult to adjust it. So we live in generally more uncertain times. So it's definitely prudent to be more conservative. And now this crisis again shows that the right thing.

Of course, we have the flexibility. We love the flexibility, especially with the CapEx-intensive program and farm downs that you are not under pressure to do it now, but you can delay it when market windows open and close, has a very high value. I mean, we could utilize that if we find the right additional investment opportunities where one big criteria definitely needs to be earnings accretive. Otherwise, we wouldn't do it. But the hurdle in the current challenging uncertain times to max it out are high, to put it that way.

On the discussion about the European electricity market design and the EU ETS, I mean, I think the best outcome is -- they keep -- they keep the electricity market design unchanged because fiddling around with the merit order might sound great, but every industry has a merit order. You always have different technologies, some more peaking, some more baseload. That's in all industries, and that is the right price signal. And the EU ETS, I think we need some reforms for the energy-intensive industry, especially there where carbon border adjustments doesn't work fully. So more free allocation and maybe also stretch out beyond 2040 with the auction of additional certificates.

But I also wish for that we keep the ETS in the fundamentals alive and don't try to fiddle around to get prices significantly lower. Why? We need significant investment in generation capacity and their marginal pricing is irrelevant. In the end, you need to cover full cost. So if we now artificially lower for some years, power prices, we're going to be hit twice in a couple of years' time because build-out will stop. I also expect then that CfDs are more difficult because if you have a huge gap to marginal prices, politicians will reduce support. And what that means because we have already tight markets and more demand to come, prices will go up over time again in 2, 3, 4 years' time, and we have the same tight situation. And then with a different market design, and we just delay investments.

So my proposals for people who want to do something for the socially vulnerable and maybe also industries is use the money which is available from the EU ETS and redistribute it or free allocations. But if you take the investment signal for additional low carbon, carbon-free electricity generation away, you're going to wake up in 3, 4 years' time in an environment which is significantly more difficult than today. And maybe we have then all redirected our investments somewhere else.

And our next question comes from Skye Landon of Rothschild & Co Redburn.

Firstly, on the 10 potential data center sites and the more than 3 gigawatts of grid connection. I was just wondering if you are able to help put that into context by perhaps providing some color on the size of the grid connection that was associated with the U.K. sites sold in November '25? And then on the merchant offshore wind assets, i.e., Sofia or Nordseecluster, can you remind us what the triggers are for these assets to move or to take kind of like COD and move on to their contracts and when that might happen?

So Skye, thanks for the question. I mean on the data center side, the U.K. projects that we only also used a fraction of our grid connection to develop the land for data centers. So we have exactly at that site, even more grid connection available. We are now developing more extensively 10 sites out of the 30 where we think data centers are feasible in the near future.

We either have already grid connection allowed for data centers or repurposing because they were planned for hydrogen or other stuff. And we are now developing the sites further. Of course, you can assume that we are in discussions with all potential customers there. But we also deliberately said because it is a very volatile and also sensitive topic in terms of competition because others are doing the same, of course, that we don't want to be too transparent. And therefore, the guidance is conservative. So everything which comes on top comes when we can announce something. And we definitely strive for more deals this year. On the second question that was?

Yes. The second one question was on the offtake from the offshore projects. So Sofia, as you know, we expect commercial operating days in 2026. And after that, it will go into an inflation-linked CfD for 15 years. So that is fully contracted. And for our Nordseecluster and Thor assets, so Nordseecluster has 2 parts. Nordseecluster A is roughly 700 megawatts, which has a COD in 2027. The other one is only in '29 and Thor has COD in 2027. And we are trying to -- we committed to PPA those assets until then. And as you probably saw, we have already contracted for Nordseecluster roughly 500 megawatts, and we are in the process of further contracting those. So therefore, ultimately, they also shouldn't be merchant in the long term.

The next question is coming from Piotr of Citi.

So I have one question about the '27 guidance and the other about the leverage in 2031. With regards to '27 guidance, can you please explain why you slightly changed the target for offshore and onshore solar offshore and FlexGen business. So offshore was downgraded by EUR 150 million and FlexGen was upgraded. I presume the FlexGen was because of the asset, but can you say what exactly assets are responsible for contributing to EUR 100 million?

And the second question about the 2031 leverage, you say it will be 3x net debt to EBITDA. But I just wanted to ask you how you convert your EUR 7.5 billion operating cash flow number that you provided into FFO and into FFO net debt, trying to see how much buffer versus your credit rating limit you have?

Yes. I'll take the question. So on the 2027 guidance, I mean, on FlexGen, it's mostly around batteries that we currently have under construction. I mean, it was mentioned that we already have 400 megawatts in Germany in production and 1.6 are currently under construction, and they clearly provide upside to those numbers, and that's then offset in offshore.

On the net debt-to-EBITDA target, I mean, the 3 to 3.5x is what we guide to the market because it's a good explainable metrics. In the end, it's the rating agencies that look at the KPIs. They have that FFO to net debt ratio. And actually, they also consider in the ratio, the cash flows or the utilization of provisions and also the lignite ones. Having said that, they also include then the E.ON dividend. So it's a slightly different metrics that they consider here.

Sure. But I was just trying to understand how much of the buffer, like what is the requirement versus what you're targeting with your 2031 numbers? I don't know if that's, I mean, can take it offline, but maybe you know like where you will be with FFO net debt versus limits.

Well, you can assume that the plan we have put forward assumes that we are in that range of 3.0, yes. So either we -- as Markus said, if there are opportunities, there's room to leverage that high or obviously, any outperformance on our targets, obviously, will also lead to more cash flow and therefore, provide additional headroom.

Piotr, I think it's a language topic. So what we translate the rating metrics into an easier to communicate metric. So when we say we're going to stay at the lower end of 3 to 3.5x net debt to EBITDA, it also means we stay on the lower end of -- or the higher end because the metric is inverse for the rating agencies. It means also from a rating agency point of view, we should have some buffer in 2031.

And our next question will be a follow-up from Olly Jeffery of Deutsche Bank.

One follow-up is just on the interest financial costs in 2031. My understanding is that the increase in the financial cost from '27 to '31 million is in part driven by higher net debt, but also in part by reduced capitalized interest. Depending on the investment decisions that you made later this decade, could it be possible that the financial costs end up being lower as you take FID for further projects into the 2030s and that capitalized interest builds back up again? Your thoughts on that would be great.

Yes. I mean look, I think the assessment you do is exactly right. Financial result is smaller because of higher net debt and therefore, more financing and offset by capitalized interest. And as you know, I mean, I mentioned that before, assets under construction are fairly high now. But as we now get more of the offshore assets operational, that asset under construction number will come down.

And with that, also the interest during construction will come down. And yes, if we would do more investment, that would have then the offsetting effect in the financial results. So that's exactly right.

Thank you, Olly. Now we've come to the end of the call. We crossed the full hour. So thank you all for dialing in. Thank you for your questions. Thank you, Markus. Thank you, Michael, for your contribution today. And of course, the IR team is at your disposal for the rest of the day and the coming weeks. And of course, we are looking forward to seeing many investors and analysts in the road shows in the coming days. So have a great rest of the day, and bye-bye.

Thank you.

A very good morning, ladies and gentlemen, cordial welcome on the occasion of the RWE Annual Press Conference for Fiscal 2025. It's great to have you here in Essen. And also, thank you very much to those who dialed in. So we have got our CEO, Markus Krebber here; Michael Muller, CFO; and Katja van Doren. So my name is Birgit Hiller, and I'm in charge of communication as a successor of Stephanie Schunck.

For you, ladies and gentlemen, there will be no changes. So Markus Krebber and Michael Muller will share the most recent financial news with you of fiscal 2025, and they will also give an outlook into the future.

Despite a challenging environment, RWE delivered and is very confident about 2026 and beyond. So our strategy was revamped, and we have got this strategy in order to get to new areas. But of course, we are troubled by the current developments, that is the war, Russia-Ukraine, but also the situation in the Gulf region. And even if our company is not active in these locations, we nevertheless are concerned by the developments. So there are very many victims already now, and nobody has got a clue where it is all going to end. And it also goes to show how fragile safety, security and peace has become. And therefore, energy is of paramount importance. And this is exactly what we are going to talk about, and we are doing this in a hybrid format.

And after the presentations, we will enter into a discussion. And if you want to ask questions here in the room, you can indicate that by show of hand. And if you have dialed in, you can enter your questions into the chat, and I will read out the questions. For our international guests, you have to know that we have got simultaneous interpretation into English, but you may ask questions in English, and they will be answered in English. And we are, of course, also happy to get your input. And it would be a good idea to switch on your cameras if you want to ask questions. So the webcast and all the presentations will then be put on to our website.

And then eventually, before we get started, the following. At 11:00, the sirens will be sounded. There are acoustic alerts that will be tested, and this is only a drill, a nationwide drill. But if you cannot switch off the flight mode, you should shortly before 11:00, switch off your telephones entirely because the sirens will come through the mute status.

So, Markus, the floor is yours.

Thank you very much, Birgit. So 'Europe will be forged in crisis', that, ladies and gentlemen, was said many years ago by one of the founding fathers of the EU, Jean Monnet. He was a politician, but also an entrepreneur. And he knew that stability and resilience do not arise from comfort. They arise from dealing with uncertainty in politics and in business. The key question, in both cases, is how do you build resilience for uncertain times? And how do you invest in a world where the rules of the game can constantly change? At RWE, we have a clear answer to this question. And today, we brought you the figures that give way to this statement.

I'm therefore delighted that you have taken the time to join us and would like to warmly welcome you all to this year's annual press conference. 2025 was a decisive year for RWE. We continue to make good progress with our growth strategy. In an uncertain environment, we once again invested billions of euros, expanded our portfolio in a value-accretive way, further reduced our CO2 emissions, and above all, achieved our financial targets at the upper end of the guidance. And this despite the fact that the framework conditions often develop dynamically. That is why we are adjusting our plans for further investments where necessary. For example, in the U.S., we had put further investment decisions on hold for the time being in view of the debates on technologies and tariffs since summer 2025. However, clarity has returned, thanks to the so-called One Big Beautiful Bill and the safe harbor rules. We have, therefore, resumed our investment activities in full.

For a second example, we can turn to the U.K. There, the government has provided a reliable framework for offshore wind build-out. In the last round of auctions, the so-called AR7 auction, we were successful with 5 large offshore wind projects. That was more than we had originally expected. We were awarded contracts for difference for 6.9 gigawatts, which now gives us a solid planning basis for the electricity revenues from our assets. This was and remains a major milestone for the further expansion of our offshore wind portfolio.

At the same time, we have entered into new strategic partnerships. Strong alliances are particularly important when making EUR 1 billion investments in turbulent times. With the Norwegian sovereign wealth fund, the renewable energy investor Masdar from Abu Dhabi and the U.S. financial investor, KKR, we are increasing our financial scope for offshore wind projects. And thanks to our partnership with the infrastructure investor, Apollo, we have secured the further capital requirements for the expansion of the transmission grid through our stake in Amprion. In brief, 2025 was a successful year for us, strategically, operationally and financially.

Above all, however, we have a product that is in demand, namely electricity. The world will need significantly more of this in the future than it does today. The International Energy Agency expects electricity demand to rise by more than 10% in Europe and the U.S. alone by 2030. This is driven by advancing digitalization, the boom in AI, electromobility, new forms of heat supply and air conditioning. This additional demand cannot be met without additional generation capacity and massive investment, and we can deliver it, thanks to our technological expertise across a broadly diversified portfolio in renewables, battery storage and flexible generation and thanks to our financial headroom.

We intend to use this and invest significantly through to 2030, a total of EUR 35 billion net. This will grow our generation portfolio of renewables, battery storage and flexible generation to a total of around 65 gigawatts. But we are not spending this money indiscriminately. RWE has a large, broadly diversified pipeline. This allows us to focus on the most attractive projects, and we only give the green light if the risk associated with the new projects are manageable and the returns are right.

We expect an average internal rate return of over 8.5% on our investment programs. We are focusing on 4 major areas for investment over the next 6 years. Firstly, power generation in the U.S.; second, flexible generation in Germany; third, offshore wind, primarily in the North Sea; and fourthly, onshore wind and solar in our core European markets, including Germany and in Australia.

What are our specific plans? In the U.S., we want to expand our business even more than previously planned, and we will be investing almost half of our total investment volume there over the next 6 years, EUR 17 billion. We already operate a broad portfolio from the East Coast to the West Coast. And over the next 6 years, we want to add 9 gigawatts with onshore wind, solar, battery storage, and now also, with flexible generation, i.e., gas-fired power plants.

Our focus here is on new gas peaking power plants. They perfectly complement our renewable energy portfolio, as they can supply electricity particularly quickly to meet short-term demand. A reliable supply is especially important for electricity-intensive customers such as data centers. These power plants are planned at sites where we already have great access. We aim to have the first units in operation by the end of the decade.

Our second investment focus is to expand flexible power generation in our home market of Germany. According to the Federal Network Agency, Germany will need an additional 22 to 36 gigawatt of firm flexible capacity by 2035. This includes modern gas-fired power plants that are technically prepared to operate on hydrogen as well as large battery storage systems, both ensure the secure supply of electricity even when solar and wind power are not available.

The German government, therefore, intends to put out to tender a total of 12 gigawatts of new flexible capacity this year with commissioning planned by 2031. The relevant legislation and tender conditions must now follow quickly so that the schedule can be met. We are ready to build 3 gigawatts of new hydrogen-ready gas-fired power plants. These will be located at the former power plant sites with existing grid connections.

We have signed preliminary contracts for turbines and are pushing ahead with the relevant planning and approval processes. These power plants will be supplemented by the construction of large battery storage systems to cushion peaks in demand and take pressure off the grid. Here, too, we will be looking to build at sites with existing grid access. Around 400 megawatts are already in operation and 1.6 gigawatts are under construction, a further 2 gigawatts, which will be able to be commissioned by 2030. In total, we want to invest around EUR 9 billion in flexible generation by 2031, primarily in Germany.

Our third focus is on expanding offshore wind. Here, we plan to add a net 5 gigawatt to our portfolio by 2031. This figure relates to the RWE share only. Since we are building the projects together with partners, the actual installed capacity will be significantly higher. The main focus of offshore expansion in the coming years will be projects in the North Sea. In addition, we are continuing to pursue our long-term plans to build offshore wind farms in Japan and Korea with local partners.

The fourth focus area is our onshore wind and solar business in our core European markets, primarily Germany, the U.K., Italy, France and Poland. These markets offer significant growth potential and attractive offtake agreements such as 2-sided contracts for difference. In this area, we aim to expand our portfolio by an additional 5 gigawatts and invest a net amount of around EUR 7 billion.

Additional opportunities are arising for us due to the demand for new data centers, both because they drive electricity demand and because we have many potential sites for data centers that benefit from existing grid infrastructure. The attractiveness of these sites for tech companies was demonstrated by our sale of a data center project in the U.K. last autumn. That's why we are working intensively on developing further locations for the potential data centers.

We also see opportunities for the reutilization of our infrastructure in the field of fusion power plants. Our existing nuclear infrastructure in Biblis and Gundremmingen, for example, provide the ideal conditions for this. Our partners focused energy for laser fusion and Proxima Fusion for magnetic fusion will make use of these sites. In addition, we contribute to our operational experience and expertise in approval processes, both increase the speed of implementation and reduce cost, a clear advantage in the global race to build the first commercial fusion power plant.

Ladies and gentlemen, you can see in a world full of challenges we can look to the future with confidence. We are investing a net amount of EUR 35 billion through to 2031. If you include our partnerships with investors, the total is considerably higher, especially in the U.K. offshore business. We are investing in a high performance and balanced portfolio that will consist half of wind and solar plants and half of flexible backup capacities and storage and with which we will achieve attractive returns with strong focus areas in the U.S., the U.K. and here in our home market of Germany since more than 1/3 of our investments are earmarked for our domestic market.

Overall, our investment program will lead to exceptional earnings growth. By 2031, our adjusted earnings per share will rise from today's EUR 2.48 to around EUR 4.4 per share. This means we will increase our earnings per share by an average of 12% every year. And our shareholders will benefit from this attractive earnings growth as well. We are raising our targeted dividend growth to plus 10% per year. This is what we mean when we say RWE has got a clear compass.

And this also applies to our goal of achieving net zero by 2040 because our ambition remains the same, to achieve sustainable growth while continuously decarbonizing in line with the 1.5-degree target. At RWE, everyone pulls together to achieve this. Once again, in 2025, more than 20,000 employees worldwide have demonstrated that team spirit, expertise and commitment pay off. This was once again impressive. And on behalf of the entire Executive Board, I would like to thank all employees for their outstanding dedication.

With that, I would like to hand it over to my colleague, Michael Muller. He will present last year's results and our financial targets for the future in detail.

Thank you, Markus. And from me as well, a warm welcome to RWE. 2025 was a successful financial year that's very pleasing and confirms our course to date. Our adjusted EBITDA came in at EUR 5.1 billion at the upper end of the guidance we communicated at the beginning of the year. Adjusted net income also reached the upper end of the forecast range at EUR 1.8 billion. Adjusted earnings per share amounted to EUR 2.48. We clearly met our forecast and even exceeded expectations for 2025 overall.

The development in the Flexible Generation segment was particularly pleasing. A significant contribution came from the sale of data center project in the U.K., which is planned to be built on the site of a former RWE power station. In addition, our stake in the German transmission system operator, Amprion, delivered a noticeably higher contribution to earnings last year.

Beyond that, we commissioned many new wind farms, solar plants and battery storage systems, which contributed to earnings for the first time, over 60 projects in total with a combined capacity of 2.8 gigawatts. 2/3 of this new capacity was connected to the grid in the U.S. At the same time, we invested robustly in the continued expansion of our generation portfolio, in total, around EUR 11 billion growth, about as much as in the previous year.

On a net basis, that is net of proceeds from divestments, our investments amounted to EUR 4 billion. The biggest individual items in our investment program in 2025 were our offshore wind projects in the North Sea, in particular, the construction of the Sofia, Thor and Nordseecluster cluster wind farms. We will commission Sofia later this year, and we're also well on track with Thor and Nordseecluster, meaning the first turbines will begin generating electricity during the year.

Additionally, last year, we invested mainly in the U.S. in new onshore wind and solar farms as well as large battery storage systems. There, renewables are enjoying a strong tailwind, as they can be built quickly and are competitive, especially to meet the growing demand for electricity from new large data centers. The projects in the U.S. are usually significantly larger than in Europe. For instance, a solar farm that can have a capacity of 100 to 300 megawatts, whereas in Europe it's often just 10 to 50 megawatts.

We currently have over 100 projects with a combined capacity of 10.3 gigawatts under construction worldwide. The commissioning of new generating facilities is also reflected in the development of our electricity production, which increased by 4% compared to previous year. However, wind speeds in our European core markets were usually unusually low. So our offshore and onshore wind farms generated less electricity.

On the other hand, our gas-fired power plants were used more than in the previous year, once again highlighting the importance of a balanced portfolio of renewables and flexible generation for the resilience of our business. And even though we produce more electricity, the carbon emissions from our power generation continued to decrease last year. This shows we are consistently pursuing our CO2 reduction targets.

Despite our high investments, our financial position remains rock solid. For example, our net debt in 2025 remained almost unchanged, and the leverage factor showing the ratio of net debt to adjusted EBITDA was 2.1, well below our self-imposed upper limit of 3. Our equity ratio improved by a full 7 percentage points to 41%. Thanks to our very strong credit rating, we enjoy excellent access to the capital markets.

Last year, we were able to successfully issue 2 long-term green bonds of $1 billion each. And for the first time in 10 years, we issued a hybrid bond in 2 tranches of EUR 500 million each. In both cases, investor demand was high and the order book was heavily oversubscribed. All of this demonstrates the future of RWE is built on a strong financial foundation.

The capital market has confidence in us. This trust is the solid basis for our further development. For the current year, we anticipate an adjusted EBITDA in the range of EUR 5.2 billion to EUR 5.8 billion and adjusted net income of EUR 1.55 billion to EUR 2.05 billion -- excuse me. For adjusted earnings per share, we expect a figure between EUR 2.20 and EUR 2.90.

For 2027, we also expect strong earnings growth. Our adjusted EBITDA should rise to EUR 6.2 billion to EUR 6.8 billion and our earnings per share to EUR 3.05.

For the past financial year, we plan to pay a dividend of EUR 1.20 per share, an increase of EUR 0.10 compared to the previous year. For the 2026 financial year, we will increase our dividend target again to EUR 1.32 per share. That's an increase of 10%.

And now, Markus, back to you.

Thank you very much, Michael. As you can see, ladies and gentlemen, RWE is not only good at developing concepts, but we also deliver when it comes to implementation. We think, plan and act with a long-term perspective. Electricity generation is a long-term business. Whenever we decide to invest today, we are committing our capital for decades.

In politics, however, the time horizon is often different. There, people think in legislative terms and sometimes even shorter. But those who invest billions of euros needs -- need reliability. If there is a risk that the energy policy will abruptly change direction with a change of government, investments will be put on hold, and this is why a fundamental consensus and energy policy is essential.

We need a shared understanding of the direction to where to and few ideological trenches about the how because above all, our economies need one thing, more electricity. If we are to succeed in this, debates like renewables, yes or no, will not help nor will setting generation and grids against each other. Instead, we need a clear focus on expanding an energy system designed for increasing electricity demand, one that becomes more resilient, meaning it reduces dependencies.

To achieve this, we must reduce our dependence on fossil fuel imports and expand generation and grids in line with the electricity system. This is our shared responsibility with policymakers, power producers and grid operators. At RWE, we're doing our share, primarily expanding generation, which is our core business and indirectly also by contributing to grid expansion through our stake in Amprion. And over the next 6 years, we will invest EUR 2 billion there in addition to our own investment program.

Our investments help to make the energy system more resistant overall. In other words, less dependent on imports because for an economy like Germany, it can only reduce its dependencies if it makes progress in electrification. The international comparison is clear. Japan and China are also massively dependent on energy imports, but their economies have an electrification rate of about 10 percentage points higher than Germany. Why? Because for a long time we met our energy needs with cheap gas from Russia, and those days are clearly over.

Today, the rule is, if we do not want to replace old dependencies with new ones, then electrification will play a key role. The more electrified we are and the more our electricity stems from renewables, the less dependent we become on fossil imports. But this also requires the right players and stable framework conditions, rules that can be relied upon and are not called to question at every opportunity. The best example is the current debate about the European Emissions Trading Scheme.

With this, we have a functioning, strong, efficient, and above all, market-based instrument, one that sets the right incentives for decarbonization and investment. And this is precisely why the European trading scheme has so far made the main contribution to decarbonization. And it also -- it goes without saying that we need viable solutions for energy-intensive industries operating in global competitive environment. But those who fundamentally question the trading system for that reason endanger Europe as an investment location.

Many companies, for example, in the energy, steel and building materials industries have invested with confidence that the emissions trading system will function in the long run. What's needed is a structured discussion about necessary adjustments to the ETS: first, a limited allocation of emissions rights even beyond 2040; second, a targeted extension of the free allocation of emission certificates; and third, using revenues from CO2 pricing more effectively to support industry.

To further strengthen electrification in general, taxes and levies on electricity should be reduced to a minimum, which means for all consumer groups. That will make electricity more attractive, drive electrification forward and strengthen the resilience and independence of our society from fossil imports. At the same time, of course, the additional electricity has come to -- come from somewhere. It must be available around the clock. And finally, it must reach the place where it is needed, that it must reach the customer. This requires major investments in generation and in grids.

Round-the-clock generation is based on renewable, storage and flexible backup capacities. In this respect, it is important and right that the German government is pushing ahead with the tendering of secured capacity. Otherwise, as the German Federal Network Agency has calculated, there is a risk of supply gap. We need battery storage and hydrogen-ready gas power plants, the former already being added without subsidies, including by us.

But the weather, multi-week periods of low wind and solar output, additional batteries are not enough. It will not work without substantial increase in genuine backup capacity that can generate electricity for several days. And finally, generation and grid expansion must go hand-in-hand. Electricity that does not reach the consumer is wasted. Resetting the incentives here is correct. So we support the German government's considerations.

But policymakers should design incentives in a way that problems can be solved for producers and large consumers such as data centers. That means building facilities in the right locations supported by differentiated construction cost subsidy for grid expansion. Then plants will be built where they make a systemic sense. All the cost of additional grid expansion will be borne. The incentive for a fast and efficient grid expansion, however, must lie with the grid operator.

I'm convinced if we address the task ahead in a consistent, rational way, they are solvable because, ladies and gentlemen, Jean Monnet's quote has a second part, 'Europe will be forged in crisis and will be the sum of all the solutions adopted for those crises'. We wish to contribute to the sum of solutions as a reliable partner even in uncertain times, one trusted by investors as well as international customers with a resilient business model, committed employees, strong financial resources and the willingness to make major investments in expanding our energy supply.

Thank you very much.

[Foreign Language] Thank you, Markus. Thank you, Michael. I think there is a lot to discuss.

And here, we've got Mr. Steitz. You can ask your question now.

Yes, I've got a couple of questions, if I may. Let me start with the U.S. Of the EUR 17 billion, how much is to go into gas-fired power plants? And can you tell me how you want to go about it? Do you want to build them yourself? Or are you thinking about acquisitions or a two-fold approach? And how do you want to organize it?

And then, I've got a question concerning the energy crisis in the Middle East. Can you give me your take on things, the developments in the region? And maybe you can also tell us whether RWE is impacted in any way because there is ADNOC there, and you discuss LNG supply with them in February, so to what degree is RWE impacted by the crisis?

Let me start with the U.S. I mean, the gas-fired power plants are under development. So we've got a particular run-up time. And this is why we said the first plants until the end of the decade, and that will tell you that the share of the EUR 17 billion is perhaps 1%. So the lion's share is onshore wind, solar and battery storage.

How do you want to go about it? I mean, we've got existing grid access, and we have got the existing infrastructure, where we are going to install renewable energy production, and the sites sometimes also have gas pipelines. And the peakers and the like can be used there. And now, we are talking to our customers, whether they want to go for 24/7, that is base load band or only renewables. And then, we are going to discuss where we are going to have additional gas-fired power plants.

And when it comes to the acquisitions, I mean, we have no assumptions in our financial statements concerning any further acquisitions. And we are not going for any major M&A deals, but what we have done hitherto as well put in additional plans. This is something that we cannot exclude sitting here and today, but no major M&A plans.

Gulf region, I mean, we all understand that this is a very relevant region for the worldwide energy supply. 20% of the global demand comes from the region, and this has come to a standstill. And this, of course, is going to have consequences. And we see that in the rising prices, particularly if and when we are having a look at Europe, we say that there is no extreme shortage, there's supply security, but of course, prices have come up, and it is much more expensive to get the energy to Europe.

And at the end of the day, if you will have to ask the question of how long is it going to take? Currently, the markets consider that within a space of 3 to 4 weeks, the problem will go away, and then, we will need a run-up phase for 2 to 3 weeks. But if it takes longer and nobody is able to assess the situation, this will have a more lasting impact and become more critical.

And then, we here in Europe will have to handle the question of how do we want to fill up the accumulators, the gas accumulators for them to be filled for the winter. And of course, we all know that energy is a driver for wealth, and 20% of the energy that is being traded is missing globally speaking. And that means the longer the conflict is going on, we will have a downturn in business activities.

Okay. There is one more question here, [indiscernible] from [indiscernible], and then, we will go to a chat show. Then after that, Ms. Becker from Borsen-Zeitung.

I would like to come back to lignite and ask for an update. Where do you stand also when it comes to reducing the number of jobs? How many jobs were done away with? And what are your plans for the next 1 to 2 years? And then also, exiting lignite activities, is that irreversible also given the energy crisis on the horizon?

And then, in more specific terms, Iran, what does that mean for supply and trading? Are they trying to change their attack? Or do you see any positive impulses for your energy trading activities? And then the share price or the share of RWE, I mean, that's skyrocketed over the past couple of months. So do you think this will go up further? Or is that as much as you can expect? And is there a share buyback program? And well, are you cognizant of the fact whether or not Elliott is still on board or whether they have gone away?

So there were several questions. Question on lignite, no plans to change the plans. We've got an agreement, a very clear one, and this is what we are using. So 2030, end of story, and the federal government is saying that we need the plants as a reserve capacity, but no decisions have been taken. If they want us to keep that as a reserve, we will.

And now Katja, the CHO.

Well, lignite exit, I want to repeat it again and again, has been planned for many years and is flanked by social measures. And it is not only that we are cutting jobs, but we are also providing solutions so that the employees can go to new jobs. And for this purpose, they are upskilled, and they are also put into renewable sectors. So today, just under 6,000 employees in lignite activities. And by 2030, it's going to be 2,000 to 2,500, roundabout-ish.

Before giving Michael the floor, trading and the share price, I understand that I have not given a full answer to your question and whether we are impacted with our LNG activities coming from the region. But you see the discussions with ADNOC are ongoing. I mean, they have slowed down a little bit in view of the problems they are having, but we've got a letter of understanding, and this is all very conducive.

And then also lignite, how much have you reduced the activities over the last year? And have you got any plans for the next year? How many staff will you reduce in 2026? 2025, about 500 job reductions, and that will go down from 5,600 down to 2,000, 2,500 by 2030.

All right. Let me talk about the impact on supply and trading that the Iran war is having. I mean, our trading activities are based on the fact that we go for fundamental analysis, and what we are observing is an event-driven geopolitical event. And of course, it is difficult to really understand how long it is going to take. And therefore, you may proceed on the assumption that we will reduce our risk positions and wait and see when the waters are calmer again. At what kind of level we are going to see?

Now, let me talk about the share. I mean, we believe that this can go up further. And it is demonstrated by the story that we have reported a minute ago, EUR 35 billion to be invested and earnings growth of 12% per annum, a dividend growth by 10% per annum. So this is a long-term value accretion for our shareholders. And therefore, we believe that there is a lot of potential for our share. And I think what is important as well is that it is very important to deliver the growth. And we had a look at the analysis of the past decade. We've always made it. We always delivered, and sometimes overachieved our targets. And this is exactly what the markets want in order to develop confidence and trust in our activities. And therefore, it is very positive for us.

When it comes to the share and share buyback programs, correct, the current program is going to be completed by June 2026. We don't believe that this will be continued over that date. But at the end of the day, this is a discussion we had a year ago. It is not important that you invest, but that you do investments in a value-accretive fashion. And this is exactly what we are doing. Are the investments making sense? And if there are changes, when it comes to their purpose, when it comes to their targets, we might change our plans. But currently, we are very confident that we will make it and that we can go for value-accretive investments.

Now, Elliott, well, you probably have to ask Elliott themselves, but they kept mum for a while. So maybe that gives you an indication what that means.

Okay. Ms. Becker from Borsen-Zeitung.

I think you can see and hear me.

Certainly.

Two or three questions, if I may. First, taking the longer view, will RWE have no more possibilities to do green investments because obviously, you are putting a lot of money into flexible generation? And then, I'd like to know whether these long-term forecasts make sense when they produce such a broad range. I mean, your forecast, 2027, for your adjusted income, you would have the result of 2025. What does that mean? And then also, the windfall profits or the tax on windfall profits -- I mean, this will be a topic that is to crop up again. Don't you think so?

First question concerning the investments. Well, our CapEx plans when it comes to the mix between renewables and storage and gas backup have not been subject to change. I mean, we always had the intention of building 3-gigawatt gas-fired power plants, and that were quite vague in the past. But now, the government has offered a remuneration plan for that. But what we have seen is a shift away from offshore net, more investment into renewable activities in the U.S. So the mix is the same. It's only a slight shift simply because we have got partnerships when it comes to offshore activities, which is much larger because of the success that we have seen in the U.K.

And if we leave aside the investments in the gas-fired power plant and growth would mean that there is an increase in the expansion of gas-fired power plant. Why would we need that here in Europe? I mean, at the end of the day, it's all about cutting dependencies. And our long-term forecast is only a point guidance. We always said EUR 4 in 2030 and EUR 3.40 in 2020 -- in 2031, but long-term forecasts are very important simply because we are telling our investors that we want to invest billions. And then, of course, they want to know what will we get by way of a return.

And then, our business has got a long run-up time. And I think more than 50% of the investment they are doing until 2030 or '31, maybe more than that are already known by name and by site and have already been contracted. So we've got building time between 3 and 7 years or construction times and a lot we are showing here, and today is already completed.

What about the bandwidth? The bandwidth is not increased. And I mean, at the end of the day, it's all driven by the wind. And if there are low wind speeds, the result may be lower. And then, we've got an offset due to the flexible generation. So there is some bandwidth in there. But if you have a look at the multiyear average, this is all offset. And in the long term, we are being very confident. And we think that 2031, 75% of the revenues will be contracted. And that, of course, offers a great degree of flexibility.

Well, windfall profit tax, I'm expecting this issue to arise. Well, the policymakers are aware of the figures, figures dating back to the last discussion, which has not been finalized yet. And really, there was not much of a result in this respect. Our situation is the following: the majority of the electricity are contracted in long-term contracts via PPAs or contracts for difference. And we've already sold the electricity. So there is no such position that we might benefit from the rising electricity prices.

Then, the parts that are flexible need to ramp up if there should be a shortfall, and then, we need to pay higher prices for the gas that we have to buy in. So the winners are who have some fossil fuels, who can export fossil fuels and who can export them. And really, Europe will not benefit from it because we are major imports, and at macro level, we will not benefit. And the industrial customers having bought in the energy and have to reduce production because the demand is not in place and the economy is suffering. And then, they can sell part of the electricity, and they can, of course, earn some money with the electricity position, but not very much because they have to compensate other losses. And if we look back at 2022 and really the benefits that were raised during that time, then you see that not much came of it.

Yes, thank you very much. And then, Mrs. Bialdiga from the Manager Magazin. And Mrs. [ Brendel ] here in the room. And then after Mrs. [ Brendel ], we will turn to Mrs. Rainer from the Rheinische Post via video.

Well, you have really, really voice agreed for the reliability and sustainability, and -- but at the same time, you are saying that you're investing a lot in the United States. How can that be brought together? Because you have had negative experiences. Then, gas-fired power plants, you wish to invest more. When will the tender take place? What about the 10% requirements on the part of the Federal Cartel Office? And who is going to bear the cost for the gas-fired power plant? Is this going to be added to the power price? Or what is your idea for the price setting?

Yes. Thank you very much. Your question on the United States, well, we perceive it here in Europe in a way that energy policy is volatile in the United States and difficult. If you talk to the U.S. team, then their view is totally different. Of course, there were uncertainties in the beginning with -- on the basis of the tax credit and the tariffs and the safe harbor rule, how much need to be secured by 2030. So we have a very clear compensation and remuneration framework for further investments. The only thing that you have to exclude is offshore. But the American administration is aware of the topic of investment protection, and we keep it on hold.

And now, I said it at an earlier stage, we -- if we are not authorized to build the installations and the offshore wind farms, then they will return the money to us. Well, the -- really, the message that we get as energy suppliers is, well, the demand is so high this is why build as much as you can, be it onshore or offshore, and really nuclear. Everything is needed, and really, the preconditions are fulfilled.

Then on the gas-fired power plants in Germany, we said, well, we can build up to 3 gigawatts. We wish to do it at already existing locations. And the 2 questions you raised with regards to the 10% rule, let me answer it as follows: well, on the basis of political decisions taken during the past decades, we were forced to decommission 2-digit percentage rate of fossil energy. And we had to reduce the number of jobs by 10,000.

And so why should we believe that if they restrict the capacity 1.2 gigawatt? And how many stakeholders are there who can really cope with such huge size of projects? And the third aspect is the consumers. It's really an auction in a competitive way, and this is why the debate is not really clear to me, and we're against such a rule setting. And I would be surprised if the 10% were decided because then we cannot add another 12 gigawatt.

And the cost, the cost for the security of supply are negligible in the framework of the total cost of energy production. If we distribute it over the useful time of 20 years, then it adds up to 1% of the electricity bill. So there's no real price effect for the backup capacity. But the grid costs and the installation that incur a lot of cost, and that is renewables, for example. And it's at the end of the day, political decision whether or not it is imposed on the consumer or whether the state takeovers. But if we take the long term, then 20 years, then the costs are really negligible.

In summer of this year, this is the latest point in time for the tenders. The awarding in the third or fourth quarter of this year.

And then now Mrs. [ Brendel ], and then, Mrs. Honing from the Rheinische Post.

My question is, you said before no M&A in terms of gas-fired power plants in the United States, but would you go for partners and build gas-fired power plants with partners?

And the second question, to what extent did U.S. policy influence your decision on gas-fired power plants that Donald Trump puts more focus on gas-fired power plants? And 1 year ago, Mr. Muller said that the trading positions would have to be reduced in uncertain times. In those days, you were talking about tariffs. Is this something that needs to be implemented now?

Yes, that's right. Major M&A transactions is not in our pipeline at individual plants, perhaps. And partnerships, well, of course. Of course, in some cases, we go for partnerships, but we do not have anything in the pipeline in this -- to this end.

Well, politics really put the framework conditions, and that influences our decision whether or not to invest. Why do -- why are further gas-fired power plants needed in the United States? And why do we invest? Well, the electricity demand in the United States is really leaping up. And the problem is that if you start to build renewables, which can be installed very quickly, but at the end of the day, you need some gas peakers for the couple of hours and days where the capacity of batteries is not enough. And of course, the renewables, they offer a lot of generation capacity, but I need a stable power supplies, and this is something we wish to offer. And if we look at the energy policy, it's interesting to see that in all regions, the same energy is added, that is really renewables, battery and flexible generation.

Trading, I addressed it before. Yes, our trade is driven by a fundamental approach and not based on position -- speculative positions. So we have reduced some position. But of course, if the situation changes, we would respond.

Thank you. Then, let's turn to the virtual room, and we're looking forward to more questions.

So this is Honing, and then, later, Rachel Miller, and then, we come back to Essen. But first from the chat Antje Honing from Rheinische Post.

Yes. I've got 2 questions, if I may. First, nuclear energy. Ursula von der Leyen regretted that Germany exited from nuclear power generation. Do you share this view? And what about the opportunities for the fusion reactors? And is there a possibility that small modular reactors come back or maybe that the old blocks or units come on the grid again?

And then lignite, we have now got the groundbreaking ceremonies for the hyperscalers in the Rhenish region. And will they get the electricity cheaper?

Thank you very much, Ms. Honing. And coming to terms with nuclear power in Germany is complete. It's finished. And I can't think of them going back online.

Well, when it comes to fusion, we are watching the developments very, very carefully. And there is one power plant together with the Schleswig-Holstein government, where we are thinking about expanding the activities. But for private companies like ours, the responsibility is for the funds. And I think it's too risky. It is not doable, and there is no provider that can mitigate the risk. And a private company like ours cannot invest 2-digit billions without any clear plan. And therefore, there are only 3 groups being active in this project. It states themselves that want to give it a try.

And then, there are regulated energy suppliers that are able to roll it out to the customers, and the customers have to pay for it. And then, there are semi-philanthropic approaches like Bill Gates, and say, I might give it a try and maybe it's a breakthrough. But for us, as a commercial company, I can't really see this as a viable thing to be done now.

And then the second question, hyperscalers, yes, we do supply hyperscalers with electricity. Of course, we do. And they would come to us when the plants are being commissioned. That is 1 or 2 years before they are being commissioned. Then, we go for long-term contracts. And the good thing is that the big American companies continue with their decarbonization objectives. So they only go for green PPAs.

Okay. And this is also the case in the Rhenish region. Well, this is something that is going to happen in the future, say, in 1 to 2 years period.

And then, the specific projects, I mean, you've seen from our press releases how many contracts we have concluded with them around the globe.

Rachel. Rachel, you can ask your question now.

Two questions about the Middle East and then one about the U.K. The first question is just what do you think about the EU's proposals to cap the price of gas?

And secondly, can you say a bit more about your own -- the impact on RWE specifically from the interruption to Middle Eastern supplies? Are you missing shipments from Qatar? And how are you replacing those?

And thirdly, just on the U.K., when do you expect the projects that won contracts in AR7 will be built by? And how much certainty is there on those timelines?

Yes. Thank you, Rachel. Starting with the first question, I think we have learned in the crisis a couple of years back that price interventions in tight markets will not help. I mean, we do need the price signal when you have tightness and scarcity of supply that the price signals should sort out where can you save, in this case, gas and oil in the cheapest manner.

I think what is needed if the crisis continues for longer, the political discussion to support the socially vulnerable customer groups and maybe even industries, but I would strongly refrain from intervening with the market system. I mean, using money to support the vulnerable is correct, but trying to do that by fiddling around with the market will in the end backfire.

The second part of the question, we are not affected with force majeure effects from Middle Eastern gas supply. So it's not part of our portfolio position.

On your question on offshore, I mean, the timelines for the AR7 projects are known. We are still awaiting final confirmation about -- now, we have the alarm here in Germany, so no worries. So we expect still confirmation about the grid connection date, which will set the ultimate delivery period. But we plan, especially the Norfolk projects to be online and providing power before 2030.

One question to the people in the virtual room. Could you hear that okay because of the distraction with the alarm signals? I do think so, yes. Okay. So we go on with the next question from Rachel about AR 7.

I answered already.

Sorry. Yes, from London, back to Essen, we go back to the room here, Mr. Witkop. Mr. Witkop, you're next. And then, Bjorn Finke, Suddeutsche. Mr. Witkop?

Gas, I mean, there were several proposals being made in order to make sure that Germany can replenish the gas accumulators. But the market signals have deteriorated in the beginning of the replenish period. So it is not really very profitable to fill the gas accumulators now. Some people think we need a gas reserve and others are saying that they need to be big enough in order to have an impact and that would rule in the market. And then, you pointed out that there is a French intervention as a kind of a role model. So what is your preference when it comes to refilling the gas accumulators?

And then, a second question, if I may. I mean, there were these 2 agreements with the United Arab Emirates, LNG and batteries, that were signed most recently. So is the current crisis having an impact on that decision?

Thank you for your question. So let me talk about the gas accumulators. I mean, if it wasn't for the crisis, the current crisis, we'd go for a reasonably dimensioned gas reserve for the nation and then have the market work in an ordinary fashion. And the market will work on the basis of average winters, not making provisions for extreme condition, and this is something that could be done by the national gas reserve. For example, if there were supply chain disruptions, like, for example, there is not enough delivery from Norway. And then, the replenishment would become more expensive. But this is not the current discussion what we should do. It would be the wrong thing to replenish an extra reserve now.

And it is completely right what you're saying here, price signals do not give us a market-based signal to accumulate gas because prices are high in summer than in winter. So there are no short-term problems. But of course, we would have to discuss how to organize it for this summer if the prices continue to be what they are today. And if the crisis goes away in a 2 to 3 weeks period, then we should be able to go back to plan A. But at the end of the day, if this is going to continue, we need some national incentives.

And then, I would think that, I mean, at the time, the government board in a very fixed pattern, and that drove prices simply because it was so predictable. So I would go for tenders, and those who make the volumes available in the most inexpensive fashion would then fill the accumulators, and then, the government can rest assured that they have got sufficient accumulation of gas, but it should be market-based.

After Mr. Finke, whose turn it is now? We will go for Nadine Bos from FAZ, and then, going back to the chat, Mr. Pauline Faust.

In your presentation, you mentioned the problem of synchronization of renewable expansion and grid expansion at the eWorld. You had the idea of redispatch in line with the government and said this is absurd. But now, you changed tack a little bit and said variable construction subsidies could be a solution. So a redispatch, is that an inferior management tool in comparison to the variable construction cost subsidies? So is it just nonsensical to do that? Or is it that on the basis of the redispatch proviso, so if you were twisting a few screws that you then get an idea of the level? And can't you then arrive at the situation that you have got a situation everybody can live with?

Thank you very much, Mr. Finke. So let me take one step back. And the objective of the grid network of the ministry is quite the right approach. We need a better management of the expansion of generation and grid. And if the generation is at the wrong place or site, and it doesn't get to the customers, it is pure waste, and nobody should be paying for that.

And I tried to make it clear in my presentation that the incentives have to be done in a way that those who can resolve the situation need an incentive to do so. And the mismatch to have the problem shifted to generation is of no avail whatsoever because we cannot resolve it. Otherwise, we would have to build our own grids. And therefore, we need an incentive. And therefore, we think a differentiated construction incentive or subsidy would do the trick.

And when I have to generate electricity somewhere and then have to transmit it to a situation which is far away, then somebody would have to pay for that. And it is certainly not the general Tom Dick and Harry who should pay for that.

And when it comes to the grid operators, they need incentives as well to expand the grids and the redispatch proviso is very preliminary in nature, but I think that would take away the incentive because at the end of the day, this is always passing the buck. But it is correct that this discussion and the technical discussion is being done. And I'm convinced that at the end of the day, we are going to have a good solution because at the end of the day, everybody is pulling together and wants the same thing.

Thank you very much. Ms. Bos, your question.

Well, a couple of my questions have already been answered. And therefore, I'd like to follow on, on the German antitrust authority. And well, you mentioned the 10% proposal already, but then in the same breath, the antitrust authority found out that we, as RWE, would be the only one which is above the market threshold. And do you consider yourself being treated in a fair fashion, yes or no?

Well, it is not about fairness, Ms. Bos. But the definition of market power is that carried out in the right way because we've got a different opinion because the electricity markets are European, and they are talking about a 5% threshold. And if you have a look at the electricity markets, Motorola and Enel in Italy and EDF in France and England, we are the biggest one. I mean, they are talking about market shares over and above 20%, sometimes close to 40%. So what is really very important is that those who do trading in the market act in a fair fashion and play by the rules.

And over the past couple of years, we had more than 45 different audits from the antitrust authorities and the stock exchange supervisory -- supervision and everybody confirmed that we are doing the right thing and that they are fair. And I mean, big companies, of course, can pay more for investments worth billions. And we've simply made sure that we play by the rules. And therefore, I don't see a problem here.

Quite the opposite is true. I see an advantage here, and I've tried to point that out as well. I mean, how many people can you think of or companies can you think of who can do 2-digit billion investments? And this is exactly what is needed in this country. And then also, the reutilization of our existing infrastructure. I mean, what we are building now is something to replace the investments in those things that we have decommissioned.

Very pleased if we can answer all the questions. Mrs. Faust, in the virtual room.

You addressed already the topic that's very easy to invest in the United States and also in renewables. And that is, is Germany a lot less attractive than United States when it comes to investing in renewables?

No, I'm not that pessimistic. I think it's quite right that discussions are taking place, and some people have to write proposals, and we have to exchange opinions. And I don't see that there are people who think that we don't need more generation and that we have to do it in an efficient way. And I think that the framework conditions will be okay, that is both generation and grid expansion will also continue in Germany.

We remain virtual. Philip Akoto is the next. And after Mr. Akoto, we will have another English question that is after Mr. Akoto and Frau Schluter, Mrs. Lucas, we would be looking forward to your questions here in the room.

Let me return to Iran because all other questions have already been answered. My question is -- so how close we are to a real energy price crisis? I know, the general market is still somewhat relaxed because the long-term prices have not increased that much. But you have your own view, and I would be interested in hearing about that.

And then possibly as -- what would be the point in time when intervention would be called for in order to protect companies and consumers?

Well, if you look at the petrol prices or electricity prices at the spot market, then, of course, we're already faced with a very tense situation because these are price levels that nobody wants to accept. And this is due to the scarcity. So we're already faced with a very tense situation. But the question arises how long will it take before a situation relieves. Again, it might exacerbate in the weeks to come. But on the other hand, there might be some sort of a relaxation in the Gulf region. So the situation is different than in 2022 because in 2022, mostly Europe was affected. And now, it's a global crisis, in particular, Asia is affected.

And well, compensation measures, and at what price level, that's a critical question. I think that really you should leave the markets alone. But what you should do is support vulnerable groups and not try to intervene in the market because these are not things that can be solved on the basis of market intervention, but there are consumers that are vulnerable. But at what point in time and at what price level politics is going to intervene is something that's not up to me to decide.

Now, an English question.

I have 4 questions. You mentioned the importance of consistency in energy politics. This week, President Ursula von der Leyen said that the German [Foreign Language] was a strategic mistake. I was wondering how did this make you feel?

My second question and my third questions are about the Netherlands. You want to invest in offshore wind in the North Sea. Will you participate in the Dutch wind tender of this year or maybe the coming years?

Third question, in the Netherlands, you have the coal-fired power plant, Eemshaven. There was a research done to see what -- which alternatives would be possible there. One option is heat storage. What are you planning to do with Eemshaven Centrale? And when will you decide about its future?

And my last question. This month, you signed a letter of intent to build a new nuclear plant in Gundremmingen. It will be a fusion reactor. This is still a very innovative technique. What are your plans in this field? Could you maybe elaborate on that a bit more?

Yes, Sabine, thanks for many questions. So first of all, I think it's not -- our business is not about feelings. So when it comes to nuclear, we look forward and not backwards. I think I said to one of the German questions already that we are done with looking back, we are looking forward, and I elaborated on that.

On offshore, yes, we are building one of the biggest offshore wind farms in the Netherlands together with Total. And you have seen the last tenders failing. The government now is working on the final details on the new auction design. And if that is a design which we think works for investors like us, then we are also willing to participate. And what is important is we need bankable projects. So we need to have certainty about long-term power offtake agreements. So in the end, the solution is contracts for difference. And I think in the Netherlands, it's also going that direction.

Next question on Eemshaven. Our current plans is according to the law in the Netherlands. We have to shut it down by 2030. And that is so far the plan. It is a very good site with many options. But in the end, the first thing is we need from the Dutch government is what is the energy policy around it, and then, we can discuss potential options. And I expect that, that discussion will now probably intensify after the new government has been formed. And when we have clarity, then we can inform you as well.

And nuclear, nuclear, so we are not -- so fusion is in the very advanced research stage. So the plans here on magnetic fusion is that the start-up company, Proxima, which is -- was founded by the Max Planck Institute in Bavaria, will do a first test reactor. And therefore, it will use our facilities because it's going to jump-start the development. If you would, on the greenfield side, build a new one, they're going to lose 5 years and more. So they're going to use our facilities. We are also open to co-investments there, but it's still in the early days. But we keep an eye on it because if that is successful, that could solve, I mean, the energy problem long term. Yes.

Thank you, Sabine. I hope all your questions were tackled. So from the Netherlands, back to Essen. Let's go back to Essen. [ Steffen Eder ] has some questions. After that, Mr. Steitz and another second question by Mrs. [ Brendel ]. Mrs. [ Eder ].

The other questions have already been answered, that is let me return to fusion. Mr. Krebber, you talked about a clear advantage and competitive edge in the global race for fusion power plants. Can you give us a figure, a year? And what is the position of Europe and Germany? The Federal Chancellor, of course, has already put a focus on fusion.

Yes. Thank you very much, Mr.[ Eder ] . There were 2 countries doing some research on fusion that is doing some research on laser fusion and other magnetic fusion that is the U.S. and Germany. This is due to our research landscape. Well, the topic, why is speed so important? That is who's fastest to show that commercial reactors will be in the developing stage, and that is those who show to be the first that he is on the right track towards a commercial project receives all the money and all the funds. So the first gets it all, and then, the others are left behind. So we'll have to look at the timeframe, what you need is research and what you need are pilot plants. And since these are plants which are impacted by radiation emission, and if you build them all in a greenfield, then 5 years would be really a very short period, and this is why we provide the setting for them.

Thank you, Mr. [ Eder ]. Mr. Steitz.

Yes, 2 further questions. First of all, margining. We haven't addressed this. What is the state of affairs here? Is this an issue? And if it's not an issue, why not?

And second question, a bit more general, what does that mean the current crisis? What does this crisis mean for the German industry and the European industries? Have they been effaced with high energy costs for years? So what are the chances for the German industry or the European industry to become competitive again?

Well, margining, first question, the question is securities, which you have to provide for deals, deals done on the stock exchanges. And after the last crisis, as regards to Ukraine, we've been in a very positive position, so no issue.

Okay. Okay, let me focus on the energy industry to answer your second question. Situation is not easy because we are overwhelmed by Chinese imports. And we, of course, are suffering from a very bad economic situation. And the CBAM, which does not work out in all areas, the Asian companies are very hard hit by the energy crisis, in part even more than we are. And so the situation is not going to become easier, and the world economic situation will deteriorate. I'm quite sure of that. And at the end of the day, it's a matter of agreeing on 2 things, that is we need further investments in electrification and that is a discussion about electricity market or generation or what have you.

What we need is more electrification and more electricity. But what we also need is solutions for the energy-intensive industries, that is we need, for example, a different allocation in the ETS systems and free allocation of certificates in order to support the energy-intensive industries.

Mrs. [ Brendel ].

My question would be the gas prices have risen quite a lot. Electricity prices have not risen as much as the gas prices, so what is the reason? Has this something to do with the renewables? Or is the demand lower than in earlier crisis period?

If we look at different countries in the world, then we enjoy one benefit, the renewables are not affected. As long as we produce renewables, then we're not affected by the gas price, that is the more we have in terms of renewables, the less we're dependent on the gas prices. The CO2 prices have not increased, but this is a warning signal because the overall economy expects, and the market expects that the economy will deteriorate.

Then, Mrs. Becker, one further question.

A question on the campus here and the topic of employees here, for example, Uniper presented its figures yesterday, and they said 10% of the jobs will be reduced in the administration? And are there plans to reduce the number of employees? Or will you add jobs? How many employees do you have here in the campus?

Well, there are 3,500 people working here on the campus. And of course, we regularly review our cost structure, whether this fits still. And for example, we looked into the cross-sectional costs. And so we looked into the rightsizing of the overall structure that the right people are in the right place.

And what were the results? And what are the consequences and your conclusions? We need to take good care of the fact that the platform cost that is support of the operational business is equipped properly that is with enough people. And we've seen that in some areas, we're over-dimensioned a little bit, and this is what we're tackling at the moment. But whenever there are changes, we do it in a socially compatible way. But the adjustments are really negligible. If we -- when we meet again in 3 years' time and exclude lignite or where there's a clear phaseout plan, then you will not see a major reduction in employees.

Mr. [indiscernible] and Mr. Finke, a follow-on.

Briefly, of the EUR 17 billion for the next 6 years in the U.S., EUR 1 billion earmarked for gas. How many power plants that are to be smaller can be erected, 5, 10?

It depends on the size and megawatt, somewhere between -- beyond 500 megawatts. And this will only be ramped up. And in the subsequent years, it could become more if and when it is successful. But in the first couple of years, we will start in a modest fashion in order to expand our portfolio, and we can then offer the backup for the baseload next to the renewables.

Okay. This is home stretch now, Mr. Witkop.

Yes, briefly on the fusion. When do you think will you be ready for a pilot project in Gundremmingen? And who are your major competitors? And here you've got Gundremmingen, so is that advantageous for you?

Thank you for the question, Mr. [indiscernible], because that makes it possible for me to actually make clear the rules. You would have to ask Proxima or when it comes to magnetic fusion focused energy in Biblis because we are not the ones that invest into the plant. We are going to give support to the company. We are going to operate to manage the site and make available our expertise, but the plans for the investment into these facilities are with the companies. But as soon as that becomes mature, ready for the market, and that will be in the 2030s, so then we will enter as well. So we want to have competition between the technology developers, and then, choose those who are most competitive. And we want to do that to the well of the German market.

Okay. I think we had a very valuable discussion on that topic. And I've come to the end of my list of questions. So I think we have been able to discuss very many different aspects of our industry, international policy, national policy, technological approaches and then also nuclear fusion and other promising technology. So I think we have really offered you a broad range of different topics. So thank you very much for coming. Thank you very much for dialing in, and thank you very much for your focus despite the alarm that went off. And then, thank you very much to the Executive Board for taking the time and answering the questions. And then also, thank you very much to my team and the technicians that had made this event a success. Now, have a safe trip back home, and have a good day.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]

Welcome to the RWE conference call. Michael Müller, CFO of RWE AG, will inform you about the developments in the first 3 quarters of fiscal 2025. I will now hand over to Thomas Denny.

Thank you, Laura, and welcome and good afternoon from Essen. Thank you for joining RWE's 9 months Investor and Analyst Conference Call today. Our CFO, Michael Müller, will guide you through our key highlights and financial performance for the first 9 months and the outlook for the current year. And with that, let me hand over to Michael.

Thanks, Thomas, and also good afternoon to all of you. In the first 9 months of 2025, our portfolio has shown a strong financial performance. We have achieved more than 80% of our full year 2025 adjusted EPS target. In the U.K., we concluded the sale of a data center development project at a former RWE power plant site to a hyperscaler. The transaction was closed and the proceeds received in October. The book gain of EUR 225 million is reported as non-recurring in the Q3 2025 adjusted EBITDA of the Flexible Generation segment. This is the second such transaction with a hyperscaler. Last year, we sold a site in Germany to Microsoft. Both transactions demonstrate the value of RWE's existing sites. These sites can be used for data center development projects as well as for new battery storage facilities or gas-fired power plants.

Our build-out program is progressing well with 11.4 gigawatts under construction as at the end of Q3. More than 2 gigawatts are scheduled to start operation by the end of the year. All of our offshore construction projects are well on schedule. In September this year, we entered into a long-term partnership with Apollo Global Management to secure funding for our 25.1% stake in Amprion. Apollo has contributed EUR 3.2 billion. It will be accounted for as equity and will further strengthen our balance sheet.

As the amount will be invested into Amprion, the effect will roll off over time. The transaction allows us to benefit from future returns of Amprion's regulated grid business and provides us with flexibility going forward. We expect closing in the coming weeks. Our EUR 1.5 billion share buyback program is proceeding well. Currently, the second EUR 500 million tranche is ongoing and is expected to be finalized by the end of this year. We will launch the third tranche shortly thereafter. Since the start of the program, we have bought back 26.5 million shares at an average price of EUR 34. Our dividend target of EUR 1.2 for fiscal year 2025 is confirmed.

Let's now take a closer look at the 9 months financials. As expected, adjusted EBITDA is lower due to normalized prices, weak wind conditions in Europe and the low trading result in the first half of 2025. In total, adjusted EBITDA came in at EUR 3.5 billion. In Offshore Wind, adjusted EBITDA was EUR 915 million. Earnings were below last year due to weak wind conditions in H1 and lower hedge prices. Q3 wind has been in line with expectations.

Onshore wind and solar recorded an EBITDA of EUR 1.2 billion. This was mostly driven by capacity additions and higher hedge prices in the U.S. Year-on-year, we have added more than 1.5 gigawatts in the U.S. This was partly offset by weaker wind condition and lower hedge prices in Europe. Adjusted EBITDA of the Flexible Generation business was EUR 1.1 billion. As mentioned earlier, we recorded a non-recurring book gain from the sale of a data center development project in the U.K. In our operating business, we have seen lower earnings, reflecting normalized prices.

Our Supply & Trading business showed a good trading performance in the third quarter after a low first half. The 9 months result stood at EUR 150 million. Other consolidation was EUR 111 million, reflecting a better-than-expected performance of Amprion. The year-on-year adjusted financial result improved due to an increase of capitalized interest during construction. In the first 9 months of 2025, capitalized interest amounted to EUR 570 million.

Adjusted depreciation stood at minus EUR 1.5 billion and increased in line with our growth program. For adjusted tax rate, we applied the general tax rate of 20% for the RWE Group. Adjusted net income stood at EUR 1.3 billion, resulting in an adjusted earnings per share of EUR 1.76. The adjusted operating cash flow was EUR 3.9 billion at the end of Q3. Changes in provisions and non-cash items were driven by provision utilization and the non-cash earnings contribution of our at-equity stake in Amprion and KELAG, where the share of net income recorded in our EBITDA exceeded the dividends of those participations. Non-cash items also include the book gain from the sale of the data center development program in U.K., where proceeds were received in October.

Changes in operating working capital were mainly driven by a decrease of inventory of gas and storage and trade receivables, partly offset by a decrease of trade payables. Net debt stood at EUR 15.7 billion. In the first 9 months, we have invested EUR 4.6 billion net in the growth of our offshore wind, onshore wind and solar and flexible generation businesses. Gross investments were offset by disposal proceeds such as from the sell-down of 49% of our 1.6 gigawatt Nordseecluster project and our 1.1 gigawatt Thor project.

Other changes in net financial debt amounted to EUR 2.7 billion, mainly driven by timing effects from hedging and trading activities, new lease contracts and share buybacks. This was partly compensated by FX effects due to a weaker U.S. dollar. At the end of the year, we expect net debt to be around EUR 12.5 billion on the back of the Apollo transaction.

Let us now take a look at our construction program. Our projects are progressing well. As we speak, we have 11.4 gigawatts of capacity under construction, diversified across technologies and regions. More than 2 gigawatts are scheduled to start operation by the end of the year, mainly onshore wind, solar, and battery projects. The construction program also includes more than 600 megawatts of U.S. solar and battery projects with attractive return profiles for which we took the investment decision in Q3.

After the IRS provided clarity on safe harboring of tax credits, we see attractive investment opportunities on the back of the AI and data center-driven power demand growth in the U.S. However, we maintain our strict investment criteria. Tax credits and offtakes must be secured. All necessary permits must be obtained and the tariff risk must be mitigated.

Our offshore wind projects are also well on schedule. At Sofia, our 1.4 gigawatt project in the U.K., all of the 100 foundations and more than half of the turbines are installed. We expect first power by the end of the year. Full commercial operation will be in 2026. Our offshore wind project 4, Nordseecluster A and OranjeWind are also making good progress and are well on track. For 2025, we confirm our outlook.

With the strong 9 months results, we are now even more confident with our guidance. Adjusted EBITDA is expected to be between EUR 4.55 billion and EUR 5.15 billion. Adjusted net income will range from EUR 1.3 billion to EUR 1.8 billion and adjusted earnings per share between EUR 1.8 and EUR 2.5. The dividend target is EUR 1.2 per share for this year. And now let me hand back to Thomas.

Thanks, Michael. Before we start with the Q&A session, let me announce our full year 2025 earnings presentation on 12th of March 2026. This time, we'll combine with a strategy update. And now let's start the Q&A session. Operator, please begin.

[Operator Instructions] We'll now take our first question from Ahmed Farman of Jefferies.

Two from my side. I was wondering if you can give us a little bit more sort of color on how you're seeing this sort of opportunity that you highlighted sort of site sales, where are you getting most of these inquiries? Are you seeing more inquiries regionally where they are? And if there is also a different, I guess, business model to capture these opportunities in the sense of -- sorry, leasing and providing PPA contracts or signing PPA contracts as well. So just looking for a little bit more color on this and how you're sort of more strategically assessing this opportunity.

Secondly, in the U.S., could you sort of help us understand if you are seeing -- started to see some benefits of, let's say, the power demand fundamentals in the U.S. in your business, be it in terms of higher power prices or repricing on open exposure for generation or if when you are now looking for incremental investments, are you seeing higher IRRs or NPVs on new CapEx project? I'll just be sort of interested in understanding how that sort of the market is evolving and what you're seeing there?

Yes, thanks for the question. Let's start with the data center topic. I mean, first of all, we do see demand pretty much across the countries in Europe. I mean, our sites are clearly in Germany, Netherlands, and U.K. And so we are currently actually working on more than 10 projects exactly in those countries. And as you said, the approach -- there can be different project approaches to those projects. I guess the most simple one is the one we did last year when we sold land to Microsoft.

In this case here, it was actually a development project where you also engage into cleaning up the site, making sure there's a proper grid connection and also supporting in the permitting process. And then you can also go one step beyond that you combine that data center development directly with the PPA and that is indeed also something we are looking into. And then, yes, you also split it, you can then either take that as a one-off sell-down or you can do it with a lease over a tenor of time.

I would say there are different approaches, and it very much depends then also on the individual projects, how you realize that. But it gives you kind of the broad variety of activities you can do. Worth mentioning that, obviously, the data center approach is one route. We do also see other routes like using existing sites for batteries. I mean, as we are currently doing with projects in Gundremingen or Lingen or some of the sites. So there are projects ongoing on that topic. And the other one is obviously also, I mean, we still hope to see auctions in Germany for gas assets. And here also clearly having sites with grid connection is an asset that we can build on.

Coming to your second question on the U.S. I mean, first of all, we clearly see a demand, a strong demand for PPAs. And you did exactly the right split. So one is what about new projects. And indeed, if you have good projects at hand ready to be built, there is an attractive offtake market. And obviously, we are trying to leverage that also with better returns on projects. And the other one is where we also now see movement in the market that offtakers are also looking into contracting existing or recontracting existing assets. But as we always do, we only communicate things once we have really closed the deals as we also did this time with the data center deal.

Michael, if I could, sorry, just ask one quick follow-up. Is there a megawatt number that you -- or gigawatt number you could provide on, let's say, projects that are not under construction in the U.S., but that are, let's say, good projects ready, permitted, tax credit that could be deployed if the right economics were there?

I mean, look, that is effectively the pipeline we currently have. I mean, we said that as part of our investment program and capital allocation, we have planned for projects that clearly qualify until 2029 for tax credits. And yes, that's the number.

Next question comes from Deepa of Bernstein.

Maybe I can stay on the U.S. for the first question. Michael, I didn't hear your gigawatt number for the permitted grandfathered capacity. Could you share that? And from memory, I think you have 10 or 11 terawatt hours of merchant output in Texas. And previously, I think you always said that it wasn't attractive to contract them. But are you seeing that the economics for contracting these are improving? So that's my first question.

And second one, just on AR7, any thoughts? I know some investors were a bit disappointed with the headline budget number, but we know the Secretary of State can keep into the bids and increase it. So what's the feeling that your team in the U.K. offshore team is telling you in terms of are they confident of getting something through because maybe 900 is a bit low.

Yes. Deepa, on the first question, you are right. It's roughly 10 terawatt hour that we have as merchant capacity in U.S. And that is the order of magnitude you're potentially talking about. But as I said, it's just a sentiment we currently see in the market. And obviously, we now need to look into closing exact deals. Second one on AR7, yes, to be very transparent, obviously, we are not happy with the low budget.

And actually, we also believe that from a macroeconomic perspective, that's not the right thing to do. I mean, we see an increasing power demand on the back of data centers in the U.K. that will require additional generation capacity. We do believe there are attractive projects, and we also believe that offshore is clearly a competitive technology in the U.K. So we feel that this would be an ideal opportunity for the U.K. government to lock in a higher number of offshore projects. I mean, bearing in mind that 2 years ago, the auction completely failed. And last year, they awarded three projects, out of which one was withdrawn, one was an existing one, so also almost no capacity.

So we believe this would be now a good opportunity. I mean, fortunately, the U.K. government does have the discretion to increase the budget once they have seen the bid. And now we need to see if they do that. I mean, on our bidding behavior, we mentioned that we have a quite substantial number of projects we could potentially bid into the auction. But obviously, we will also leverage the flexibility we have there and do decent bidding in that auction.

Michael, you did not answer to my question on how many gigawatts you've grandfathered in the U.S. already under IRA?

Yes, we didn't -- so we didn't communicate a number, but we have sufficient capacity to build basically all the projects we have planned until 2029 in our pipeline.

So keep aware, the capacity for the tax credit we have will not be the limiting factor.

Our next question comes from Alberto Gandolfi of Goldman Sachs.

The first one is, is there a way you could tell us how many gigawatts you could be offering to data center developers, I guess, where you currently have power plants that either recently closed or you're about to close? And if you cannot tell us that, can you tell us how many gigawatts these 10 projects you are negotiating, Michael, perhaps would represent? And is the deal you announced today representative of what could be the valuation? I crunched some numbers and I may be totally off. So very happy to be proven wrong. But if I'm not totally off, did you just sell today this land and site and connection point and whatever at almost EUR 1 million per megawatt.

The second question is, can you tell us what is your outlook for power demand in Central Europe and U.K.? We clearly have not seen power demand move yet. But with the rising penetration for EVs, air conditioning, data centers, now we're seeing all these announcements. Can you tell us what the outlook is for demand? And is there a sensitivity to FlexGen you can give us? I don't know, 2% demand per year is an extra EUR 500 million, EUR 600 million EBITDA, something like that. I'm clearly overly simplifying.

Yes, thanks for the question. I mean, obviously, I can't give you the exact number of the project, but I guess, a simple back of the envelope calculation. I mean, I talked about 10 projects. If you assume a similar size as the one we just sold, I think that's probably a good estimation of what potentially could be done. And I think the order of magnitude per megawatt is a fair estimate. But as I said, it very much depends on the concrete sites, how much you develop the project. Clearly, if you just sell land, it's substantially less. If it comes with further development activity, it does increase the value, and that's obviously what we are working individually on the projects.

The second one, power outlook for Europe. I mean, look, the two drivers to look at is clearly AI and recovery of the industry. Let's start with the latter one. I mean, we all hope for a recovery, we are not currently seeing yet. So that will be the decisive factor. The second one is on AI. And I think that's the good news after we have discussed that multiple times in calls that we also do see demand for AI capacity in Europe. It's now the first time that we actually see deals being closed and also communicated. I mean, you saw Deutsche Telekom with NVIDIA and announcing a deal. Google yesterday announced one deal. So that's for me a clear sign that they are now moving forward into doing concrete investments, and that obviously will also drive the power plant demand.

To give you an estimate, how much exactly the growth is and how much that would impact the return or the earnings of FlexGen, that's a tough one. I mean, look, I guess it's more when we discussed the income of flexible generation, it is fair to say that we see the earnings as quite stable because with an increasing tightness on the back of decommissioning of existing assets and also increasing power demand, there clearly is the need for firm capacity and flexible capacity to tap into that value pool.

The next question comes from Harry Wyburd of BNP Paribas.

Two for me. So the first one is the development of Ahmed and Alberto's question, but very specifically focused on European baseload prices. So you mentioned in the U.S., and I think we're all more than aware that the supply and demand dynamics in the U.S. mean that PPA prices are running much higher than sort of implied forward curves. Fundamentals are very strong on round-the-clock prices. But what's your view on how specifically that plays out in Europe?

And I'm talking baseload prices because obviously, here, we've got a lot more renewable supply. Would you expect to see a positive benefit or even an outright increase in European baseload prices, assuming the gas prices are flat from data center and industrial demand recovery? Or do you think we're better off looking at the kind of tree, I guess, that Alberto was mentioning on the FlexGen side, capacity payments, et cetera. So that's the first one.

And then the second one, continuing that thread again, could you just help us understand a little bit how you could benefit from the German capacity market? We've obviously been very focused on the new build gas. But what's your latest view on how the capacity market will play out? What assets are going to be eligible? Any rough idea on how you think pricing might pan out versus the U.K. or even Ireland, where obviously the payments are massive?

Tough questions, Harry. Let's start with the baseload. I mean, fundamentally, it's very clear that data centers do come with baseload. So therefore, they should clearly have an impact on baseload prices. So that's very clear. Now in the end, I mean, I would say -- you probably have to look at that ceteris paribus because I mean, clearly, what is also important is how do gas prices develop, how do CO2 prices develop, but also how does the build-out of renewables happen. But ceteris paribus, if you assume in a model more data centers, yes, that clearly will bring up baseload prices. And it also will bring up prices for flexible generation because it is typically the few hours that are tight where you then will see the higher spikes of prices. So I would say it should impact both.

Obviously, there will be some offsetting effects because clearly, with higher prices that will also then trigger more investments into batteries, flexible generation, or renewables. Yes. So there is some offsetting effect. But at the end, since we are in the business, that could also provide us with good opportunities. So long answer, I think that the whole development -- any growth in power demand is beneficial for our business model and therefore, beneficial.

About the German capacity market, I mean, it very much depends on the exact design. But if you take a step back, again, this should be very positive for us because it provides a stable income basis for all our assets, as you see in the U.K. So it's kind of an underlying floor that enables to stabilize the earnings. And then the rest very much depends on the exact design. I mean all -- from European regulation, it needs to be technological neutral, which I think would be a good argument. And then it's clearly the question, how does it deal with new builds with kind of capacity where you need to do some investments to refurbish them and what does it do with existing assets.

But I mean -- if you look at our portfolio, I mean, we have quite some assets with lower utilization. And obviously, for them, it would be attractive if they could bid into such a capacity market, plus it does provide upside for new assets. As we discussed, the sites that we have at hand are not just interesting for data centers, but also potentially for new assets such as flexible gas assets to be built.

And our next question comes from Rob Pulleyn of Morgan Stanley.

Yes, Rob Pulleyn from Morgan Stanley. Two further questions. Just going to shift gears from data centers as exciting as it is. And both of these are on nuclear actually. The first one is RWE owns about a stake in the uranium enrichment company, Urenco through its URANIT joint venture. Is there any potential to monetize this asset where the book value, I think, is only EUR 72 million and potentially through the sale of assets in the U.S., given the U.S. government labeled uranium as a critical mineral.

And secondly, dovetailing back, we've spoken about German nuclear restarts previously and seems like the current German government is not following through on reviewing or this is likely, which I think we all acknowledge was the RWE position. However, in the U.S., we are seeing hyperscalers actually signing contracts to restart nuclear behind the meter. Would this be at all possible in Germany from your perspective?

Yes, Rob, thanks for your question. I mean, first of all, -- very fair question. I mean, first of all, clearly, the value of Urenco has increased lately because the demand for enriched material is increasing and so are the prices. And you also see investment opportunities into new enrichment facilities. So it is an attractive asset.

Now the complexity here is that there are some contractual regulation around that one. So it's not as easy to just sell it. So if you find somebody for us to buy it at a good price, we're happy to sell it, but it looks very difficult because it's not really fungible. Having said that, if we cannot sell it, obviously, the asset as such gains in value because with higher incomes, dividends will grow over time, and that also contributes to our earnings and cash position. So we do believe it's an attractive asset. Unfortunately, it's not as fungible as we would like it to be.

On nuclear, I think, first, to reiterate, no, we don't see nuclear to come back to Germany, and that's true for both things also behind the meter. So we don't see an application for behind the meter because, I mean, it would -- it's still -- in both cases, it needs the acceptance of politicians and the German public, and it also needs kind of reliability of a longer tenure on support for nuclear, which clearly is not -- is there in Germany.

And our next question comes from Peter Crampton of Barclays.

Only one question from my end. And it relates a little bit to your very strong kind of Q3 and obviously, EUR 225 million kind of book gain in FlexGen. We've seen the other consolidation division much better than guidance and also on the kind of financial expenses as well. Any particular reason why you haven't increased your 2025 guidance already? And that will be the only question.

Look, I mean, first of all, we feel very comfortable with the guidance. And as I mentioned, obviously, on the back of a strong Q4, that makes me even more confident, but you also have to be very clear, it's very much dependent on the weather in Q4. And obviously, in all our guidance, we assumed normalized winds for Q4. So far, October has been fine, but there are 2 more months to come.

And now our next question comes from Peter Bisztyga of Bank of America.

Just going back to the data center topic. Clearly, in Germany, you have disconnected a vast amount of nuclear and coal capacity from the bridge by the end of the decade. And I'm just wondering, have you got a sense today how much of that could be suitable to put load on to site data centers on? So that's my first question.

And my sort of second question, actually just on the kind of behind-the-meter generation point. Wondering, actually, first of all, in Germany, for example, if the CCGT auctions don't quite meet up to expectations or not big enough in size, do you see an opportunity to build behind-the-meter gas generation for data centers that could at some point in the future be cited on your grid connection points? And I guess a similar question in the U.S. Could you build gas generation on your existing grid interconnection points and potentially service data centers from those?

Yes, Peter, thanks for the question. I mean, first of all, on the nuclear side, I mean, with nuclear sites, it's more a longer-term perspective because if you have decommissioned a nuclear site or if you have stopped commercial operation of the nuclear site, the decommissioning process requires you for continued operation for quite some time until you have all the nuclear rods out of the containment. So clearly, for the first 3 or 4 years, you need to be fully connected to the grid. So therefore, it takes some time until really that -- the grid capacity becomes available, yes. So that's a little longer process.

Yet, obviously, you can use some of the lands and sites. I mean, as we do in Gundremmingen, which is a former nuclear site, -- and I mean, in Bieblitz, we also built a gas assets formally. So there are some opportunities. And obviously, coal assets, yes, that's something you can clearly do. So I can't give you a gigawatt number here, but especially the coal sites are attractive with that respect.

Talking about the behind-the-meter topic, I mean, I would answer that twofold. One is clearly, a gas asset without support from a capacity market is not a new build. It's not economic currently. That's also why we believe that auction is required to get new capacity into the market, yes. It's different for existing assets, as I answered previously. So if you have an existing asset and a capacity market would give you additional funding to keep it in the market, that is kind of attractive. But for new assets, they need a proper capacity remuneration to be economic. And that's the same for behind the meter and then also regular assets. In the U.K. -- in the U.S., it's slightly different, especially since there is the large demand by some of the data center providers to go for baseload. And indeed, we are currently looking into options to potentially also provide smaller gas assets to complement our renewable generation, but that's still early days.

And our next question comes from Piotr of Citi.

It's Piotr Dzieciolowski from Citi. I have two questions, please. So the first one I wanted to ask you about the Amprion performance, which is booked in the other division. I believe it is performing much better than the regulatory framework would suggest based on the book value. So can you please explain what is -- why is this performance so much better? And how will this effect be reversed in the future years? So that's question number one.

And the second question, I wanted to ask about the progress on adjusting your merchant offshore portfolio. We talked a lot about the demand for, and so on. So like how does this affect your ability to sell a contract power on the long-term basis for the merchant projects you are building in Denmark and Germany?

Yes. Let's start with the merchant offshore. I mean, clearly, that is helpful. I mean, you know that we still have some of our projects where we want to contract them pre-COD. And that -- these are exactly the discussions that are ongoing, and we are optimistic and then clearly that additional demand does help in the marketing of those assets.

On Amprion, I mean, look, I can't go into the details. That is something you also then need to discuss with the Amprion management on the numbers. But it's clear that they are performing better than in the plans, and that is also by optimizing the grid build-out, but also optimizing kind of the regulatory returns they have on the assets.

[Operator Instructions] And we'll now move on to our next question from Ingo Becker of Kepler Cheuvreux.

Michael, on your data center remark that apparently, all else the same, if you add more demand, prices should rise. Apparently, there are secularities in the real world and particularly in the power system, and I would be interested to see how you think all of this will play out. Also wondering, you said we're looking for the economic recovery as a main driver. But if the economy then finds itself in an even higher energy environment, that surely will have a political side who have started to emphasize this also with the latest monitoring report. So just curious what your thoughts are on this.

And the second question would be, to the extent you can comment on this, given apparently that things are moving and changing, how you think your CapEx plan and mix might be adjusted or changed going forward, perhaps with a directive indication to -- for the post '27 period?

Ingo, thanks for the question. Let's start with the easier one on the CapEx plan adjustments. I mean, Thomas already announced that in Q3, we will use the full year numbers to also give some more light on our strategy, give a strategy update. And clearly, capital allocation and CapEx will be a focus of that discussion. So sorry about that to make you wait until those numbers because I think by then, we also have more clarity on some of the other topics, hopefully also on the German gas assets and then provide a complete picture here.

The other question you raised around that circularity, yes, fully right. I mean, there is some repercussions. But talking about German industry, I mean, first of all, the current situation in the German industry, honestly, is not purely an energy price topic. I mean, yes, there are some industries that are impacted by power prices. But I do also know from some of my peers that at the current prices also with some of the support, energy prices are not kind of the issue. There are other issues that also need to be addressed. I think it's more important that going forward, the status is kept. So that's the question of can we keep free allocation? What about the releases on taxes? Does that stay? So it's more keeping the status quo, which in the end is then also required for longer-term investment decisions.

But I think there are also other questions that are more decisive for industry that's like productivity of Germany, labor force, these kind of things. So yes, there is some effect of power prices, but clearly not the only one. I mean, the other one to bear in mind, if you look also at our offtakes, we talked about PPAs. I mean, especially in Germany, the industry is also a potential offtaker. And we believe that also securing long-term PPAs is a good way for industry to lock in attractive power prices also in the -- for a longer turnover. So we do believe that if there's more optimism, that should also help us to contract more PPAs and by that, also then facilitate that.

There are no further questions in queue. I will now hand it back to Thomas for closing remarks.

Great. Thank you all for dialing in. Thanks for the good discussion this afternoon. Looking forward to seeing many of you during our London roadshow next week and the rest of this year or elsewhere in the world in the coming months. Have a great rest of the day, and bye-bye.

Welcome to the RWE conference call. Markus Krebber, CEO of RWE AG; and Michael Muller, CFO of RWE AG, will inform you about the developments of the first half of fiscal 2025. I will now hand the call over to Thomas Denny. Please go ahead, sir.

Thank you, George, and good afternoon, ladies and gentlemen. Thank you for joining RWE's conference call on H1 2025. Our CEO, Markus Krebber; and our CFO, Michael Muller, will first guide you through our presentation, and then we will start our Q&A session. And with this, over to you, Markus.

Yes. Thank you, Thomas, and a warm welcome to everyone. Our robust portfolio led to a good financial performance in the first half of '25 despite weak wind conditions in Europe and a low trading result. We are on track to deliver our full year earnings guidance. Our construction program is progressing well with around 11 gigawatts under construction, more than 3 gigawatts will begin commercial operation in the second half of this year. And all our offshore construction projects are on schedule. The investment frameworks in our core markets are taking shape. In the U.K., the market design provides a stable environment for future investments. In Germany, we see a focused energy policy with higher priority for security of supply and industrial competitiveness. In the U.S., The Big Beautiful Bill has been signed into law. And we are prepared to take advantage of the upcoming investment opportunities if our investment criteria are fulfilled.

Our U.K. offshore pipeline puts us in a great position to take a selective approach for the upcoming AR7 auction. In Germany, we have an attractive development pipeline for new gas plants and batteries, which will enable us to benefit from the rising investment opportunities in flexible generation and security of supply. In the U.S., we have the potential to continue our build-out program in the next years. Our robust portfolio in combination with our disciplined capital allocation gives us high visibility on our earnings per share growth. And on the back of our dividend growth and the running share buyback program, we will deliver an attractive shareholder return. Let's now get into the details and move to Slide 5. We have delivered a good financial performance in the first half '25 despite the headwinds of weak wind and low trading.

Adjusted EBITDA stood at EUR 2.1 billion and adjusted net income at EUR 0.8 billion. Adjusted earnings per share stood at EUR 1.1, reaching 50% of the full year guidance midpoint. When markets were dominated by geopolitical events and less by market fundamentals, our traders were cautious in position taking. Hence, we see low earnings. In Q3, we have so far seen an increased performance in trading. We remain confident of delivering earnings within our guidance range for all segments. For the full year '25, we confirm our adjusted EBITDA, adjusted net income as well as adjusted EPS guidance. Our construction program is progressing well. As we speak, we have around 11 gigawatts of capacity under construction, diversified across regions and technologies. Out of that, we will bring more than 3 gigawatts to commercial operations in the second half of the year, mainly onshore wind, solar and batteries. And all our offshore projects are well on track.

Sofia, our 1.4 gigawatt project in the U.K. has reached a major construction milestone with the successful installation of the 100th and final offshore monopile foundation in mid-July. Since March, we have installed 36 turbines, and we expect grid connections and first power later this year. Full commercial operations will be in '26. At our Danish 1.1 gigawatt offshore project, Thor, foundation and cable installation work are ongoing. So far, 49 of 72 foundations have been installed. Installation of turbines is expected to begin in '26. Our [660-megawatt] Nordseecluster A project in Germany has also reached a key milestone. We installed the first foundation in mid-July. As of now, 4 turbine foundations have been installed. Wind turbine installation is expected to start in '26 with commercial operations beginning in early '27.

As part of our constant portfolio optimization, we closed the selldown of 49% of Thor and Nordseecluster to Norwest Bank Investment Management in Q2 this year. At our OranjeWind offshore project in the Netherlands, we will start to install the foundations in summer '26. For this project, we have joined forces with TotalEnergies in a 50-50 joint venture. In our core markets, visibility of investment frameworks has improved over recent months. In the U.K., we have clearly seen positive developments. Firstly, the retention of one price zone keeps a certain and stable landscape for future investments. Secondly, the updated AR7 auction rules are a signal of confidence and a strong commitment to the renewable energy strategy of the U.K. government. The decision to extend CfD periods from 15 to 20 years derisk the cash flow of projects further. The raised price cap and improved load factor assumptions for offshore are positive developments, too.

Now the size of the auction budget will be key, which is expected in autumn before bids are due. We have a strong U.K. offshore development pipeline that can participate, 9 eligible projects with a capacity of up to 7.5 gigawatts offer us a broad range of options. The 7.5 gigawatt still includes 100% share of the Norfolk cluster. As part of our offshore portfolio optimization, we will reduce our stake to 50%, and we will project finance these assets. With our versatile and mature offshore project pipeline, we are able to be selective, prudent and flexible on timings. All investment decisions must fulfill our strict investment criteria, and we will continue to be very disciplined in the auctions as we have proven over the last years. The German energy policy is focused on cost efficiency, security of supply and industrial competitiveness. A key pillar to ensure security of supply is the auction of gas new builds. We expect the auction design to be published before the end of this year. That would mean the first assets could come online by the end of the decade.

The second step, a technology-neutral capacity mechanism is planned. The new EU rules now give clear guidance for a fast-track approval process. The focus on cost efficiency and industrial competitiveness is a positive signal for the German industry and our customers. As part of the coalition agreement, the government is working on relief measures for the energy-intensive industry. The EUR 500 million infrastructure package, the German government will put in place helps to support the overall economy. We are prepared to take advantage of the upcoming investment opportunities, again, if our investment criteria are fulfilled. Our attractive gas power plant pipeline is well developed, and we are ready to construct 3 gigawatt of gas plants if we are successful in the auction.

We have our respective supply chain largely secured and have already reservation agreements for 2.7 gigawatts of gas turbines and engines. We have also been active on the development of additional battery opportunities. Batteries will continue to play a key role in the integrated power system with renewable energy and deliver attractive returns. In Germany, we currently have 400 megawatts of batteries in operations and 1 gigawatt under construction. Additionally, we have around 2.5 gigawatt of battery projects under development in Germany, which have a planned COD before the end of the decade. In the U.S., we have been maintaining our strict requirements for investments in the current market environment. We only bring projects to FID that have tax credit safe harbor, tariff risk mitigated, offtake secured and all necessary permits in place.

With The Big Beautiful Bill now being passed, we do see continued tax support for further build-out. We are awaiting final clarity on tax credit eligibility, such as start of construction and safe harbor provisions as well as FEOC restrictions in the coming weeks. Our proactive procurement strategy has been helping to manage and limit tariff risk. The market environment remains positive as we see overall structural power demand growth in the U.S. This helps us to secure offtake for our projects ahead of FID. However, we will not compromise on the strict investment criteria and risk management requirements. Coming to the conclusion on Page 10. We offer attractive earnings growth through 2030. Bottom line earnings will grow with a strong 18% EPS CAGR to 27% and 13% to 2030. We target an annual dividend increase of 5% to 10% per annum, and we will execute on our existing share buyback program of EUR 1.5 billion, which run until Q2 '26. And with that, now over to Michael.

Thank you, Markus, and also good afternoon from my side to all of you. On the back of our robust portfolio, we have delivered a good financial performance in the first half of 2025 despite weak wind conditions in Europe and a low trading result. Adjusted group EBITDA stood at EUR 2.1 billion and adjusted net income at EUR 0.8 billion. Adjusted earnings per share were EUR 1.1. We confirm the guidance for the full year. Our EUR 1.5 billion share buyback program is making good progress, and the first EUR 500 million tranche has been completed. Shortly thereafter, we started with a second tranche. The full program will be completed by May 2026 as planned. So far, we have bought back 19 million shares at an average price of EUR 32. Only recently, our strong BBB+ rating from Fitch has been confirmed with a stable outlook.

On the back of an expected higher share of contracted EBITDA and an increased share of power generation from clean technologies, Fitch has relaxed the leverage target. Our strong credit rating highlights the successful transformation of our business, the robust and resilient portfolio and underlines our financial prudence. In June, we successfully returned to the hybrid bond market. We have issued a EUR 1 billion green bond in 2 tranches at attractive terms. Our bonds met with a high investor demand with an order book that was oversubscribed by more than 10x. Let's now take a closer look at the H1 2025 financials. Despite weak wind conditions in Europe and low trading results, we have achieved solid earnings. In offshore wind, adjusted EBITDA was EUR 643 million. Earnings were below last year due to wind conditions and lower hedge prices.

Compared to the first quarter of last year, our offshore wind generation volume was down 23% due to lower wind speeds across our U.K. and German offshore wind portfolio. Onshore wind and solar recorded an EBITDA of EUR 830 million. This was driven by significant capacity additions, predominantly in the U.S., partly offset by weak wind conditions and lower hedge prices in Europe. Our U.S. capacity amounted to 11.2 gigawatts at the end of H1 of this year compared to 9.7 gigawatts a year earlier. Adjusted EBITDA of Flexible Generation business was EUR 595 million. As we expected, we have seen lower earnings in line with normalized prices. Our Supply & Trading business showed a low trading performance in H1 and stood at EUR 16 million. When markets were dominated by geopolitical events and less by market fundamentals, our traders were cautious in taking positions. Hence, we see lower earnings in H1.

In Q3, we have seen so far an increased performance in trading. We remain confident to achieve earnings well within our guidance range. Other consolidation was EUR 55 million. In total, adjusted EBITDA came in at EUR 2.1 billion. The year-on-year adjusted financial result improved due to an increase of capitalized interest during construction. For adjusted tax, we applied the general tax rate of 20% for the RWE Group. Adjusted net income stood at EUR 775 million, resulting in an adjusted earnings per share of EUR 1.06. The adjusted operating cash flow was minus EUR 390 million at the end of H1, driven by seasonal effects. Changes in provisions and noncash items were driven by seasonal effects in the utilization of provisions. It also includes the cash flow from our phaseout technologies. Changes in operating working capital were marked by the purchase of CO2 emission rights in Q1, partly compensated by a decrease of inventories of gas and storage.

For the first time, the hand-in of CO2 certificates is due in Q3 of this year instead of Q2. This leads to a seasonally higher working capital balance in H1. Net debt stood at EUR 15.5 billion. In the first half of 2025, we invested EUR 2.5 billion net in the growth of our offshore wind, onshore wind and solar and flexible generation businesses. Gross investments were offset by disposal proceeds, in particular from the sell-down of 49% of our 1.6 Nordseecluster project in Germany and our 1.1 gigawatt solar project in Denmark. Other changes in net financial debt amounted to EUR 700 million, mainly driven by timing effects from hedging and trading activities.

At the end of the year, we expect net debt to be lower than at H1 and slightly below our 3x leverage target. For 2025, we confirm our outlook. Adjusted EBITDA is expected to be between EUR 4.55 billion and EUR 5.15 billion. Adjusted net income will range from EUR 1.3 billion to EUR 1.8 billion and adjusted earnings per share between EUR 1.8 and EUR 2.5. The dividend target is EUR 1.2 per share for this year. And now let me hand back to Thomas.

Thank you, Michael. We'll now start the Q&A session. Operator, please begin.

[Operator Instructions] The first question today is coming from Peter Bisztyga of Bank of America.

So 2, if I may. First one, I guess, on your guidance and full year outlook. I get sort of net income was 50% the full year in the first half. But actually last couple of years, I think it was more like 75% or 80% that you did in the first half. So can you sort of help us bridge to how you think you get to the midpoint of your guidance for the full year in the second half, please?

And then a question on capital allocation. I guess, kind of focused on allocation round 7. I think you sort of mentioned you'll kind of look to sell down and project finance these projects. So I guess that will reduce the burden of nonproductive capital employed. But we had [indiscernible] describing it very much as a buyer's market at the moment. Press reports suggest that their kind of efforts to sort of sell [indiscernible] haven't exactly gone smoothly. So I'm just wondering how do you see this? And is there a risk that there's sort of not enough demand out there for you to be able to progress U.K. offshore without basically carrying more of that on balance sheet, please?

Okay. Peter, thanks for the question. I'll start with the guidance. Indeed, the profile this year, we expect to be slightly different. So rather a 50-50 split between H1 and H2. The reason being clearly, if you recall, when we gave the guidance in February, we also saw poor wind conditions in the first month and considered that already in the guidance. And secondly, we have seen a low performance in trading and do expect a normalized performance of trading in the second half. And as we already mentioned in the speeches, we actually also have seen so far in Q3, a good performance of the trading so that we are very confident to deliver in our guidance.

And I'll take the second one, Peter, on AR7 and Norfolk and farm-down. So we have already said at full year results when we presented our farm-down strategy that for especially the big Norfolk projects, we want to get everything in sync. So we will only take an FID and commit to additional capital commitments if we have a farm down, so an equity partner for 50% or 2 and project finance. So we will not front run. So we will not go first and then find a buyer, but we synchronize the project that everything comes together at the same time. So you can assume that we are already in the market talking to potential buyers. And I think if we have an attractive project, it also depends, of course, on the CfD price, and it should not be a problem to get that done.

Our next question will come from Alberto Gandolfi of Goldman Sachs.

The first one is on earnings. And I've seen that the weakness in '25 seems mostly from nonrecurring elements, load factors, trading. So I guess my question is, if we see in the next year, '26 and '27, a normalization in load factors and trading, that's probably EUR 350 million up. So first, I was going to ask you if this is, you think, correct, the headwind you've seen this year so far? And secondly, can you help us mark-to-market financial expenses? Because you're guiding EUR 500 million this year, but you did just over EUR 50 million in H1. and you continue to invest. So if work in progress remains to a degree, elevated, does it mean that your EUR 500 million financial expenses estimate for this year should be much lower? And does it mean also that in 2027, your EUR 750 million estimate maybe is more like EUR 600 million.

So all I'm trying to say here is without getting tangled in the numbers, if EBITDA normalizes and financial expenses remain lower, are we -- are you basically implicitly telling us there is an upgrade in '26 and '27 for the bottom line? Very long, sorry, that's the first question. The second is -- sorry, I'm getting there. The second question is, we are seeing some of your peers' share prices and businesses getting under heavy pressure, any temptation in being a consolidator in renewable industry in Europe?

Yes, Alberto, let me start with the comments on the financials. I guess -- it's clearly a good summary that the effects you see in H1, namely clearly below average wind conditions and a poor trading results are one-off effects we have seen in H1, and there shouldn't be any read across for the years to come. Secondly, your observation on financial results is also in the right direction. So indeed, we are seeing some improvements on the financial results.

I mean, just give you a few comments. I mean, you saw us placing a hybrid in a very attractive environment. We delayed our bond issuance -- U.S. bond issuance in April. And there also have been some phasing effects like tax credits that kind of reduced the amount to be financed. So there is clear effects that you focus on. Is there a read across to '26, '27? Look, I mean, financing cost very much depends on the investment program. So we need to see how indeed, as Markus referred to, investments are going, and that will also then determine the financing costs going forward.

On your second question on consolidation, I mean, we have laid out a very clear capital allocation framework when we announced the share buyback. And I can just reconfirm that big M&A company transaction are not part of that capital allocation plans, which we currently have. That doesn't mean that we go for a project here or there where it could make sense, but that's more organic development activity. No big M&A on the table.

We'll now move to Olly Jeffery from Deutsche Bank.

3 questions that I would have, please, first of all, looking at the difference between your gross CapEx for H1 and your net CapEx, there seems to be a delta of around EUR 2.7 billion, of which EUR 1.4 billion is in connection to the partial divestment of Thor and Nords. What bridges the gap to the EUR 2.7 billion? And then the second question is just coming back to the financial costs that Alberto was asking about. There's kind of 2 ways that you can look at this. One is, given your minus EUR 50 million for the half year once you strip out the E.ON dividend, that would imply the underlying H1 ex the dividend was EUR 250 million, which could imply if you had that in H2, you could end up around EUR 300 million for financial costs. Or conversely, if you take the full year guide of EUR 500 million, where the underlying implied net interest cost is EUR 350 million, and it's EUR 50 million from H1 that lands you at EUR 400 million.

But is it that kind of order of magnitude where lower of EUR 100 million or more the financial costs for the full year could end up below EUR 500 million?

Yes, Olly, thanks for the question. Let's first start with the CapEx. So indeed, a big driver is the sell-down we've seen on Thor and Nordseecluster. And then the way how accounting treats it, you also have the contribution from minorities to projects like, for example, Masdar on our Dogger Bank project that also count as divestments and reduced the net cash investments. And further, there has also been some optimizations that kind of contribute to the number. Finally, on financial results, I think good analysis and yes, leading in the right direction.

Next question will be coming from Deepa Venkateswaran of Bernstein.

My 2 questions, actually, I did want to stick on the financial cost. Just more to understand if there were anything one-off that you see and how much this is extrapolatable to future years. So again, if it were not EUR 500 million, but rather EUR 400 million or EUR 300 million, then just to see how much of a run rate -- was there anything one-off that's happening this year that doesn't flow through to next year? So that's my first question. And the second one is on the U.S. You're expecting the treasury guidance next week. What are your expectations on how dramatically it might change? And could you also comment about any capacity you have already safe harbored in 2024, which is not going to be impacted by how this treasury guidance comes out at?

So Deepa, I'll take the first part. No, there is no one-off apart from obviously the E.ON dividend that is part of the financial result in H1.

And the second question is on the U.S...

Sorry, I was just saying, so we should say that a sustainable level of financing costs is maybe lower than what you have expected at the beginning of the year?

No. I mean, look, there are some effects like, for example, obviously, the more attractive hybrid that is clearly impacting also later years. Then obviously, it's a question how FX rates would develop going forward. I mean we currently see elevated U.S. dollars. So that's obviously reducing the financing cost, but that very much depends on that. And then there are also some timing effects that are more -- this year's effects like the U.S. dollar bond I talked about or some tax equity financing where we get cash earlier.

Deepa, on U.S., I mean, given what we have experienced in the last months, I don't want to speculate. So I mean, our mindset is we take it when we know it and then we draw the conclusion. On safe harbor, the same. I mean I could give you a number under the old assumption, but let's wait for the final rule, and we will immediately communicate to you what we think is possible in terms of build-out. But as I said previously, it's not only safe harbor. Probably that is not even the limiting factor. It's also mitigation of tariff risk, which is still volatile. And if that is not manageable, then it would also delay investments. I mean I think there is an optimism that given the significant power demand need that we get clarity on both aspects, and then we are in a position to tell you exactly how we adjust our plans going forward.

We will now move to Harry Wyburd of BNP Paribas Exane.

2 for me. So first, it's another one on the U.S., but a point that you didn't touch on in your answer just now. What are you seeing on permitting in onshore and particularly onshore wind? Obviously, federal permitting has been tightened up. It's a bit of a difficult one to judge from a distance because it's very project specific. But do you expect any issues around permitting, whether you're crossing federal roads or lakes or et cetera, that could complicate your FIDs and so on over the next few years in addition to what's going on with safe harbor and tariffs?

And then on the second one, obviously, we've got going on in the press and politically the debate about power subsidies in Germany or power cost subsidy or grid transmission subsidies and tax cuts. Could you help us just understand -- as things stand at the moment, what share of demand or industrial demand is going to get these subsidies, i.e., people that don't already get them that will? And how material is that? And how elastic do you think that demand is? And what I'm getting at is, do you think that when these are enacted, it might actually start to lead to a recovery in sort of real-time power demand, which obviously has been pretty elusive so far and therefore, has slightly diluted the overall argument on power demand growth in Germany and in Europe.

Thanks for the questions. First, on the U.S., we have no development on federal land for projects on private land, as you pointed rightly out, there are aspects here and there where you need a federal permit. For some others, you don't need it. We have no, let's say, negative experience so far. But what we have made clear is we will not take an FID without all permits being in place. And if you need a federal one, you need a federal one. Of course, the teams are currently looking into the entire development pipeline to see where it's easier and where it's more difficult. But I cannot give you firsthand experience because we have not taken an FID in wind so far this year given our strict criteria on all the aspects I mentioned.

Second, on Germany, it's difficult to exactly give you the amount of power, which is consumed by those who now benefit from part of the relief measures, which have been announced like grid is for everybody, but lowering the taxes to the minimum permanently for the energy-intensive industry, but they are also working on other compensation mechanisms. I would roughly say in total, it's probably around 20%, 25% of the power demand, which is some way or the other positively affected by some effects.

But it's -- this is not the only driving factor of power demand. This is probably a prerequisite to give the energy-intensive industry confidence if they want to, to invest also in Germany again. I think what is currently more of a driver is the muted industrial activity. So especially in areas like metals need for cars and so on. So if we see their positive development, then probably in the next coming years, the more relevant factor, the long-term confidence on government support for the energy-intensive industry is more important for long-term investment.

Next question will be coming from Wanda Serwinowska of UBS.

Wanda Serwinowska, UBS. Two questions from me. The first one is on the AR7. Do you see the supply chain ready for AR7? And how much commitment do you have from the supply chain? And the second question is on the phaseout technologies cash flow. It turned negative this year. So Michael, what should we expect in terms of the run rate of the cash flow -- adjusted cash flow from the Phaseout technologies over the next few years?

So Wanda, on AR7, I cannot talk for the industry. I can only confirm that when we enter into an auction, we have pre-agreements with supply chain that we know what the prices are when we trigger the project. So we will not run into an auction without pre-agreements on pricing of the most relevant components. So for what we're going to bid into it, supply chain is secured.

Well, now on the phaseout technologies, I mean, first of all, what is important is, and we already stated that in the last call that clearly the operations of our assets are cash flow positive. So otherwise, we wouldn't operate them. Secondly, if you remember, when we introduced the KPI, we said that over the tenure until 2030, the cash flow of the phaseout business should be neutral. And therefore, I mean, you have seen a very positive cash flow in 2024. This year is negative. And as you know, we are already preparing the business for the phaseout. You should expect higher costs in the years to come, which will then come down and therefore, also the cash flow should improve. So basically, the profile of phaseout technologies is a strong one in '24. Next 1, 2, 3 years that's probably poorer and then they are improving towards the end of the decade.

Next question will be coming from Piotr Dzieciolowski of Citi.

I have 2 questions. So the first one is on the gas capacity auction coming in Germany. How big do you think the tender has to be or what kind of shape does it have to take in order for you to -- profitable action for you? Because there's a quite a bit of supply. It looks like you have a secured 3 gigawatt, but also some of your competitors talk openly that they secured the low pricing. So just thinking like if it comes at 5 gigawatt, then do you think it could be a profitable tender or you have to be much bigger to create a bigger demand for this project? And the second question I have on your 2.5 gigawatt battery pipeline. Can you talk a little bit about timing, CapEx and possible contribution of this pipeline? How quickly can you bring it? What it cost you? And what could be the contribution?

Yes. Piotr, thanks for the question on the gas capacity, the minister last time she went public on gas was she wants to reach an auction volume of above 10 gigawatts. But coming back to, I mean, what I said for us, bidding in the auction since we have full flexibility on the supply chain, it's not important to reach the gigawatt, but to have good investment. So if the auction volume is lower, we probably do less in the beginning and later more. But given the need, and we also expect the security of supply assessment coming out pretty soon that the number tends to be higher than lower what is needed to ensure security of supply in Germany in the current situation. So my expectation is currently in auction volume before we get to a full-fledged capacity market where, of course, then you can also incentivize new builds long term will be above 10 gigawatt.

And I always said we never want to target a market share above 25%, 30%. On the batteries, I mean, these projects are in advanced development, and that is the status where you typically also discuss with your suppliers and contractors. We have not taken FID. So I don't want to speculate. But as I said, COD is potentially before 2034, the entire 2.5 gigawatt. The battery case, especially in Germany, look very attractive, and you earn a lot in the first years. But we're going to update on that when we have taken FID. And now coming back to the long-term earnings projection we have given. So we need certain investments, which are still not uncommitted to reach the 2030 EPS guidance if we want to do it with investments and not by additional share buybacks. So please, it's also not a new positive news that we have the EUR 2.5 billion, but it's actually also needed to find good investment opportunities to deploy capital prudently.

[Operator Instructions] We'll now go to Peter Crampton calling from Barclays.

Peter Crampton here from Barclays. Two questions, if I may. The first one was just around kind of the new German government we have and whether you've seen any kind of encouraging signs of change, particularly relating to this EUR 500 billion kind of infrastructure fund they're planning. And then whether that kind of auction by year-end for new capacity, whether you feel it is something where government realizes that returns have to be really good for kind of the related commitments.

On the second question, we now have The Big Beautiful Bill in the U.S. We obviously still need to hear around this kind of German kind of capacity auction, but whether you feel you're getting more information allowing for that update on kind of capital allocation kind of early next year, whether there's some kind of early thoughts on that.

Yes. So let's start with the German government. This is a very high-level question. I would say, directionally, we are happy with the direction that they now strengthen security of supply and industrial competitiveness and of course, a more cost-efficient and synchronized build-out of renewables in sync with the grids. I think it's the right direction of travel. What I hear between the lines is that, of course, for those aspects where you need agreement with Brussels like industrial power prices, but especially also the gas build-out, they are in almost daily, weekly discussions with the European Commission. But this is for us also a black box, but I see lots of engagement there. So I would say, in order to -- for the energy policy, tick the box, we, of course, other than the right direction, also want to see implementation after the summer break.

So probably it's good in another 90 days to say whether it's good or not. But so far, direction of travel is right. Your second question was on capital allocation. Yes. I think, as I said, it's not only that we need clarity on the executive order. We also need to see how the tariff situation is evolving. I mean I think it's too early to say that we have reached more or less a stable situation. You can also be surprised by changes every day. So it will probably take some time before we feel confident to give you numbers on capital allocation. I mean before we said end of the year, early next year, I think that is still the right time frame because that would also give us full visibility on the German capacity remuneration.

We now have a follow-up question from Olly Jeffery of Deutsche Bank.

Two follow-ups for me, please. One is on flexible generation. The midpoint of the guidance for that business is EUR 1.2 billion this year, and it's EUR 1.35 billion in 2027, and you've done EUR 600 million thereabouts in H1. Given the increased volatility in intraday pricing that you're seeing and opportunities to make money around that, do you think that there's a possibility of more exceeding the midpoint of the guidance this year rather than coming underneath it?

And then also, if you think that, that volatility is more sustainable than when you set the original 2027 guidance of EUR 1.35 billion. Do you think there's now a bit more upside to that compared to when you first made it? And the second question I have is just on AR7. It would seem to me that with your extension projects like Rampion 2 and [indiscernible], you probably have some of the most cost competitive projects that could bid into the auction. Would you agree with that statement?

Well I'll start with FlexGen. I mean, look, -- that's too early to tell for the entire year because you know volatility is, to some degree, difficult to predict. Yet, I mean, what we always said is that we duly expect markets to get tighter, and that is something where our flexible generation fleet and also our phaseout business are benefiting from. And what you, for example, see this summer is that, yes, you have very low prices during the day, but during the night, almost all units are running. And that is indeed obviously something where those assets are benefiting from. And what you also see so far in H1, there is kind of offsetting effect when you have lower winds in Europe, you do see upside on the flexible generation side. And that is the pattern we observe, and we also expect to go forward. But I would say with respect to 2027, we feel comfortable with the guidance we have given so far.

On AR7, Olly, let me put it that way. I mean, we are very happy with the pipeline we have. I don't want to speculate about relative competitiveness. But just make a comment, I think in offshore, it's still the right -- it's still the time to be more on the conservative and cautious side, given that you talk about billions of investments. And so far, I mean, as we also have clearly said in this call, we are making good progress on our projects. And I think top priority is to keep it that way.

As we have no further questions at this time, I turn the call back over to Thomas Denny for any additional or closing remarks.

Great. Thank you, everyone, for dialing in. Thank you, Markus and Michael, for the time today. And of course, the IR team is at your disposal for any further questions you might have for the rest of the day or in the coming days. For those of you that head out on vacation in the coming weeks until Labor Day, I wish you a great holidays and hope you are recharging fresh, and I'm sure we see plenty of you during the upcoming conferences and roadshows that we are scheduled from September onwards. Have a great day, and see you soon. Bye-bye.

Thank you very much. Ladies and gentlemen, that will conclude today's conference. Thank you for your attendance. You may disconnect. Have a good day, and goodbye.