RWE cuts investments by more than a fifth as US market 'impossible to predict'

By Christoph Steitz and Tom Käckenhoff

ESSEN, Germany (Reuters) - Germany's RWE on Thursday warned of lower profit this year and said it would cut planned investments by 10 billion euros ($10.9 billion) through 2030, also citing uncertainty facing U.S. renewable energy projects under President Donald Trump.

The move underlines the impact of rising geopolitical risks, supply chain constraints and lower returns in the global energy sector, which has triggered similar steps by major rivals Orsted and BP in recent weeks.

RWE, the world's second largest developer of offshore wind farms, said it was currently "impossible to predict" what changes in U.S. energy policy would mean for the expansion of renewables in the country.

About half of RWE's installed renewable capacity is based in the United States, where Trump has taken aim at offshore wind technology, an area where the German group is exposed through early-stage projects.

"Given greater uncertainties, it is all the more important that we are even more cautious," RWE CEO Markus Krebber said, keeping open the option of share buybacks as an alternative way to return cash to shareholders.

Current developments of around 4 gigawatts in the country were essentially shielded from tariffs, Krebber said, something that was not certain for future investments in light of the administration's behaviour.

Shares in RWE were 4.4% lower at 1023 GMT.

Brokerage Morningstar and investor Enkraft, a long-time critic of RWE's strategy, both urged the group to expand the share buyback programme as a way to raise value.

"RWE lacks the credibility to generate the targeted returns with its investments. When this trust is restored, investors will also make capital available to RWE," Enkraft said.

RWE said the cut to investments will reduce its spending for the 2025-2030 period to around 35 billion euros, adding it was also raising the return requirements for new investments to more than 8.5% from 8% previously.

Along with peers, RWE has faced a more challenging global investment environment for renewable energy projects, while investors have for some time criticised the company's capital allocation as a result.

RWE said it expected adjusted core profit (EBITDA) of 4.55 billion euros to 5.15 billion euros in 2025, down from 5.68 billion in 2024. Adjusted net income is forecast to be between 1.3 billion euros and 1.8 billion euros, down from 2.32 billion.

($1 = 0.9202 euros)

(Reporting by Christoph Steitz and Tom Kaeckenhoff; Additional reporting by Vera Eckert; Editing by Ludwig Burger, Sharon Singleton; Tomasz Janowski and David Evans)