E.ON profit falls as demand dips

GAS, electric and water utility giant E.ON yesterday said its net profit fell 22 per cent in the second quarter as it faced weak demand for power in Europe and increased competition from subsidised renewable energy.

Net income at the German group, which has major UK operations, was €919 million (£790m), down from €1.18 billion a year ago.

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Despite the fall, chief executive Johannes Teyssen reaffirmed the company’s earnings forecast for the year, but also said the regulatory and business environment for the legacy power generation business was tough and “no recovery is in sight”.

Last month E.ON said it was mothballing a two-and-a-half-year-old gas-fired plant in Slovenia because it was unprofitable and Teyssen noted that, unless things change, more shutdowns are “unavoidable”.