German power giant RWE in red in second quarter

RWE, Germany's number two power supplier, said Thursday that it posted a loss in the second quarter of the current year and was sticking to its forecast of a drop in full-year profits.

RWE said in a statement that it booked a net loss of 424 million euros ($471 million) in the period from April to June, compared with a net profit of 29 million euros a year earlier.

Second-quarter sales fell by 3.4 percent to 10.5 billion euros.

Taking the first six months of the year, underlying or operating profit fell by seven percent to 3.2 billion euros, RWE said.

"The main contributing factor was the continued decline in margins in conventional electricity generation," it explained.

RWE is the biggest operator of coal-fired power stations in Germany and has thus been hit harder than its rivals by the country's energy policy turnaround, with renewable sources of energy being subsidised at the expense of carbon fuels and nuclear power being phased out.

Looking ahead to the full year, RWE said it was sticking to its forecast for a decline in operating profit to 6.1-6.4 billion euros and net profit to 1.1-1.3 billion euros.