EU UTILITIES: UTILITIES: RWE (RWE Baa2/NR/BBB+): 3Q24 Results
Marginal negative on the buyback over investment, but unlikely to be market moving.
• RWE reported adj. EBITDA 11% ahead of consensus (3 estimates).
• We estimate FCF at -€980mn on elevated investments. YTD FCF stands at -€5.64bn.
• Net debt increased €735mn to €12.2bn. Leverage stands at 2x and is expected to stay well below 3x cap for FY24.
• FY24 guidance is improved from the low end to the middle end of the range, effectively a 6% improvement from low end to midpoint and ~3% ahead of consensus.
• €1.5bn buyback over the next 18 months announced from zero. The pace of capex will be slowed over the next 2 years due to uncertainty on renewables in the US and slower than expected development of green hydrogen in Europe. That’s around 0.25x turns of LTM leverage for context.
• Webcast 12.00 GMT https://www.rwe.com/en/investor-relations/financial-calendar-and-publications/2024-Q3/
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JPY: EUR and GBP aere also testing session highs
- Since the USDJPY is getting closer to the initial 150.00 level, the EURJPY is now coming close to 163.61, last week's high, although most market participants will look for the next resistance at 163.89.
- GBPJPY sees 195.97, the September and the highest printed level since 31st July as the next upside target.
OUTLOOK: Price Signal Summary - Key Bund Support Remains Exposed
- In the FI space, a bearish theme in Bund futures remains intact and price continues to trade below both the 20- and 50-day EMAs. Attention is on the next key support at 132.65, the Sep 2 low. Clearance of this level would strengthen a bearish theme and highlight a stronger reversal. Initial firm resistance is at 134.09, the 20-day EMA.
- A bear threat in Gilt futures remains present and the recent impulsive sell-off reinforces a bearish theme. The contract has traded through support at 98.11, the Sep 2 low and a bear trigger. The break strengthens the downtrend, signalling scope for a deeper retracement. The 96.00 handle has now given way, exposing the 2.0% 10-dma envelope line at 95.35. Initial firm resistance is seen at 98.11, the Sep 2 low. First resistance is at 96.93, the Oct 7 high.
OPTIONS: Larger FX Option Pipeline
- EUR/USD: Oct15 $1.1000(E1.8bln); Oct16 $1.0950-55(E2.4bln), $1.0975(E1.0bln); Oct17 $1.0735-45(E1.9bln), $1.0990-10(E2.7bln)
- USD/JPY: Oct17 Y147.60($1.1bln)
- AUD/USD: Oct15 $0.6675(A$1.7bln), $0.6775(A$1.7bln), $0.6800(A$1.7bln)
- USD/CAD: Oct17 C$1.3600-10($1.0bln)
- USD/CNY: Oct17 Cny6.9867($1.3bln), Cny6.9913-18($2.0bln), Cny6.9934($1.0bln)
