RWE Repeats Commitment To Streamlining Core Portfolio

Aug. 13, 2003 – RWE Tuesday reiterated its commitment to streamlining its core business portfolio.

“In the core business, too, we must sell sometimes,” Chief Executive Harry Roels said when presenting the company’s first-half results.

Disposals will help RWE cut its EUR22.3 billion debt. The company said Tuesday that debt would drop to below EUR20 billion by 2005.

He said that RWE is still reviewing the fate of its stake in US coal producer Consol Energy. RWE has already informed the Securities and Exchange Commission about a possible reduction of the stake, leaving the option of a disposal open.

Other planned divestments include a 75 per cent stake in Portuguese power plant Tapada, for which a bidding process has already been initiated, Roels said. However RWE doesn’t see the divestment of its non-core operations this year.

The company restated its 2005 net debt target, taking no account of a possible sale of printing machines maker Heidelberger Druckmaschinen and construction company Hochtief.

“It doesn’t make sense selling at the bottom of the cycle,” Roels said. “We still have financial power to take our time with the sale,” he added.

Heidelberger Druck and Hochtief posted a combined operating loss of EUR54 million in the first half.