‘Bloodstains on the balance sheet’ but RWE will recover – Terium

The chief executive of RWE predicts that the company will endure another two years of pain before the recovery process goes into full swing.

Peter Terium told the Financial Times that the utility was moving through a “vale of tears” that “will last beyond this year and the next”, but that the “recovery is going to come”.
He bases his forecasts on an expectancy that power prices will rebound and electricity market reforms set to benefit conventional power generation.

Having posted a financial loss for the first since the formation of the Federal Republic of Germany, Terium points out that while power generation has suffered as a result of the government’s aggressive Energiewende policy, the rest of the business is in good health.

“There are bloodstains on our balance sheet,” he told the FT, adding that distribution, sales and trading are all “very sound and healthy”. He added that power prices were “bottoming out”. “If coal picks up, and we get our act together on CO2, power prices will . . . trend slightly upwards.”

Terium concluded by saying that the good news for companies such as RWE was that “German society still needs significant conventional power as a back-up”.

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