Balance sheet structure affected by changes in the market value of commodity derivatives

As of December 31, 2008, our balance sheet total amounted to €93.4 billion. It was up €10.0 billion on the level at the end of 2007. This is mainly because the market value of our derivatives has risen. It was up €7.8 billion on the assets side and €7.7 billion on the equity and liabilities side. This primarily relates to commodity Glossary derivatives. Our energy trading business also had a major effect on current receivables and liabilities. Accounts receivable from sureties (variation margins and collateral) increased by €2.4 billion, while trade accounts receivable were up by €1.6 billion. This was contrasted by a comparable increase in current liabilities. Current marketable securities decreased by €3.1 billion largely because we sold a substantial amount of them. We used the proceeds to finance the dividend payments and our share buyback as well as to redeem capital market debt, among other things. On balance, changes in foreign exchange rates reduced the balance sheet total by €2.6 billion. The weakness of Sterling had a major impact.

The rise in the balance sheet total and our share buyback programme played a substantial role in reducing the RWE Group’s equity ratio from 17.6 % to 14.1 %. Equity and non-current liabilities covered 120 % (2007: 124 %) of our non-current assets at the balance sheet date. This is proof of RWE’s solid finance and capital structure.