E.ON reshuffle creates profits

After posting the first annual loss in company history last year, Germany's E.ON power supplier has announced strong first quarter results, saying pre-tax earnings in the period jumped 8.6 percent to about 3.8 billion euros ($4.98 billion).

Net profit surged about 30 percent compared with the final quarter of 2011, and was expected to come in at around 1.7 billion euros, Germany's biggest utility said, adding that the figures were still provisional.

In 2011, the company, based in Dusseldorf, posted a loss of 2.2 billion euros, suffering the shutdown of two of its reactors ordered by the government in the wake of the Fukushima nuclear disaster in Japan.

E.ON said it was planning to file a complaint with Germany's highest court demanding compensation.

Describing 2011 as a "tough year," E.ON Chief Executive Johannes Teyssen told a news conference in March that the company was "past the worst."

For 2012, the utility gave an upbeat outlook, confirming its forecast of a net profit between 2.3 and 2.7 billion euros.

Disinvestment drive

E.ON also announced it would seek stronger growth in foreign markets and enhance its renewable power business.

In addition, the company appears on the verge of selling off its Open Grid Europe gas distribution subsidiary - a deal which was in the "final phase of completion," Chief Financial Officer Marcus Schenk told the financial newspaper "Börsenzeitung" on Wednesday.

Furthermore, E.ON recycling subsidiary Energy from Waste, as well as local power supplier E.ON Westfalen Weser were up for grabs in the firm's disinvestment drive aimed at reducing its payroll by 11,000 employees.

Stressing that the utility was still "diversified too much," Schenk said that "in our portfolio you will find a number of assets which do not match our core business."

Therefore, E.ON might be going beyond its envisaged disinvestment volume of 15 billion euros this year, he added.

uhe/nk (Reuters, dpa)