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RWE Q3 net income falls 48 percent

German utility RWE AG said Thursday that net income slid 48 percent in the third quarter as demand for gas and electricity fell in the economic downturn.
/ Source: The Associated Press

German utility RWE AG said Thursday that net income slid 48 percent in the third quarter as demand for gas and electricity fell in the economic downturn.

RWE, based in Essen, reported ⁈llion ($854 million) in net income, down from ⁈llion in the July-September period of 2008.

Revenue for the period fell to ⁈llion from ⁈llion.

For the first nine months, however, RWE saw a 26 percent increase in income attributable to shareholders, partly on gains from a divestment. The company said its power supply and trading activities also experienced a positive trend.

RWE said it earned ⁈llion in the January-September period, up from ⁈llion in the year-ago quarter as some units, such as Npower in the U.K., were hurt by extreme price and cost pressures. Revenue fell 2 percent to ⁈illion.

The sale of a stake in its American Water unit contributed $750 million to the company's results and removed a significant amount of debt from the balance sheet. RWE still holds a 23.5 percent stake in that company.

Shares of RWE were about 1 percent higher at ⁈in Frankfurt afternoon trading.

RWE said it expects world economic output to decline by more than 2 percent this year and that the situation in its European markets will remain difficult for the duration of the year.

That said, the company expects full-year 2009 earnings to be near the ⁈ion it earned in 2008, while revenue will be below the nearly ⁈lion reported last year.

It said the downturn will continue to have an effect on the prices of fuels like coal and oil but also on demand for electricity and gas.

The company said measures to enhance efficiency and reduce costs by ⁈llion by the end of 2009 compared to 2006 are on target.

Last week, RWE and another German utility, E.ON AG, said they set up a joint company to build nuclear power stations in Britain.

The new company, called Horizon Nuclear Power and headquartered near Gloucester, will focus on new power stations with a 60-year lifetime.

Horizon foresees potential investments of more than 15 billion pounds ($25 billion) in developing around 6,000 megawatts of nuclear capacity by 2025.

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On the Net:

http://www.rwe.com