E.ON warns there is "no recovery in sight" as earnings fall

German energy giant E.ON has warned the coming years will be “demanding” as first half earnings fell 15 per cent to €5.7bn (£3.7bn) on the back of bad and worsening business conditions.

Chief executive Johannes Teyssen said that low capacity utilisation and wholesale power prices were hitting the generational and gas storage businesses.

These adverse factors will continue and, according to our analysis, may actually get worse. Much will depend on future policy decisions which largely can’t be foreseen. A sober view of the situation indicates that, at least for 2013 and 2014, no recovery is in sight. That’s why I announced at the start of the year that we’re responding—particularly in our generation business—by cutting costs and enhancing efficiency….

The years ahead will be demanding, but also decisive years for our company’s transformation. E.ON is becoming leaner, more decentralized, and even more international. The results of our work won’t always be immediately reflected in rising earnings; there’s simply too much pressure on parts of our traditional business. In addition, a number of outside factors remain difficult to predict. But with your support and trust, we’re now laying the foundation for our future success.

(Our emphasis)

Earnings per share increased six per cent to €1.61.