E.ON Delivering step by step

 
E.ON Delivering step by step
E.ON
Delivering step by step
E.ON Delivering step by step
Key investment highlights
     Highly stable business profile with ~2/3 of EBITDA
     from regulated, long-term contracted businesses1

     Well positioned to profit from megatrends digitization,
     decentralization, e-mobility, renewables

     Deleveraging: from 5.3x Net Debt/EBITDA (FY 2016) to
     ~4.0x Net Debt/EBITDA (mid-term target)

     Potential overachievement of deleveraging targets
     offers potential room for profitable growth and
     dividends

     Attractive dividend payout ratio (minimum of 65%2)

     Rigid focus on capital return and discipline

1. Including Energy Networks and a portion of Renewables and Heat 2. Based on Adjusted Net Income, from FY 2018 (payable in 2019) onwards   2
E.ON Delivering step by step
Highly stable business profile

 Business profile                                                                                FY EBITDA 20161

              High share of regulated and long-term contracted
               earnings (~2/3 of EBITDA )
               Operations in Energy Networks under stable, well
                                                                                                                   15%
                                                                                                                                                            Energy
                                                                                                                                                            Networks

              established frameworks in low risk markets with
               strong regulatory track record
                                                                                                             12%
                                                                                                                       €3.7bn         51%
                                                                                                                                                            Customer
                                                                                                                                                            Solutions
                                                                                                                                                            PreussenElektra (non-core)

              Predominantly quasi-regulated or contracted                                                       21%
                                                                                                                                                            Renewables
               earnings in Renewables and heat operations

              Remaining merchant exposure in Renewables and
               PreussenElektra largely hedged                                                            ~2/3 from regulated/long-term contracted
                                                                                                                       businesses2

1. Adjusted for non operating effects, representation in pie charts excluding Corporate Functions/ Other; total figures including Corporate Functions/ Other, 2. Including
Energy Networks and a portion of Renewables and Heat                                                                                                                               3
E.ON Delivering step by step
E.ON at a glance

Key financials FY ‘16                                              Energy                                         Customer
                                                                                                                                          Renewables
                                                                 Networks                                         Solutions
                                                                                                                                        15%1
    Adjusted EBIT €bn
                                                                    57%1                               28%1
              3.1

                                                                                                  >22m Customers across         >6GW Renewable capacities
Adjusted net income €bn
                                                                                                   Europe with strong cash      delivered across Europe and
                                               ~€19bn Regulated asset base                             flow generation                     the US
              0.9                                mainly in Germany and
                                                        Sweden                                   New solutions: operator of
                                                                                                  largest e-mobility charging    3 GW onshore pipeline to
                                                                                                      network in Denmark         drive “growth” in the US

                                                 €1.7bn EBIT (FY 2016)                            €0.8bn EBIT (FY2016)           €0.4bn EBIT (FY2016)
1. FY2016 EBIT adjusted for non operating effects, representation in pie charts excluding Corporate Functions/ Other                                        4
E.ON Delivering step by step
Delivering step by step…
E.ON Delivering step by step
Potential over-achievement of deleveraging could
create balance sheet head room
Economic net debt
€ bn

        26.3
                                       Debt
                                     Reduction

                             19.7                                                                                          Debt reduction measures
                                                                                                                                                                     1
                                                                                                                           + Monetization of Uniper shares        ~3.8
        ~5.3x
                 NFT3
                 ~€2.85bn
                                                                                                                           + Transfer of NS12 into CTA            ~1.0
       EBITDA    ABB4
                 ~€1.35bn   > 4.0x                                                       ~4.0x                             + Nuc. decommissioning cost            ~1.0
                            EBITDA                                                      EBITDA                                 savings
                                                                                                                           +   Additional measures (mainly
                                                                                                                                                                  ~1.0
                                                                                                                               non-core disposals excl. Urenco)
                                                                                                                               No hybrid issuance necessary
       FY 2016              9M 2017             post          potential balance        mid term
                                            deleveraging      sheet head room           target

1. Based on share price of €22 (Fortum’s bid for E.ON’s Uniper Shares), 2. Nordstream 1 stake, 3. Nuclear Fuel Tax, 4. Accelerated Book Build                            6
E.ON Delivering step by step
Raising payout and striving for dividend growth

Payout ratios by E.ON and peers

                                                                                                                  Dividend policy:
  80%                                                                                                             • Raising payout ratio to a minimum of 65%2
                                                                            Peer group1                           • Striving for payout ratio in line with peers

                                                                                                                  • Specification of exact range with FY2017
  65%                                                                                                               results
                                          E.ON target
  60%                                                                                                             • Targeting absolute dividend growth (base year
                                                                       Previous payout E.ON                         2017)
                                                                            50% - 60%
  50%                                                                                                             • Strong alignment of management and investors
                                                                                                                    through E.ON Focus

1. Peer group: Centrica, Enel, EDP, Iberdrola, innogy, SSE, 2. Based on Adjusted Net Income, from FY 2018 (payable in 2019) onwards                                 7
E.ON Delivering step by step
Capex budget under review

Medium-term – Gross capex
€ bn
               ∑ ~10.0                  -20%                ∑ ~8.0                   Strict focus on capital discipline across all business units
                                                                                     CAPEX budget for the mid-term under review
                                                                                     Update with FY17 results

  2016         2017          2018                 2017       2018          2019

2017 – Gross capex
€ bn                                                                                 Energy Networks investments of 1.6x regulatory depreciation
                                                                                      driven by new renewables connections, grid maintenance and
                                                  1.5                                 digitization
                                0.7                                  3.6             Customer Solutions investments in heat and new solutions (i.e.
         1.4
                                                                                      contracted onsite generation) and IT upgrades in UK/Germany
                                                                                     Renewables investments : European offshore (~800 MW) and
  Energy Networks        Customer Solutions    Renewables            Group
                                                                                      US onshore (~500 MW)                                             8
E.ON Delivering step by step
Energy Networks: Multi-decade growth

Mega trends support multi decade growth                                      RAB growth: potential for higher replacement capex on
                                                                             top of continuing network extensions
Mega trends driving multi decade growth
  Emergence of bi-directional flows as opposed to the purely one-
   directional flows in the past
  Higher complexity of asset management, asset operations and asset         Example: Power RAB in Germany
   optimization
                                                                             € bn                            +3-4% p.a.
  Renewables build out
          Majority of renewables connected to the distribution
            networks (instead of the transmission networks)                         +2-3% p.a.
          Increasing role of distribution system operators (DSOs) vs.
            the transmission system operators (TSOs) for overall                                    8.0
                                                                                                              €100-200m p.a.
            system optimization                                                                                  add. capex
  Smart meter roll-out                                                      7.1                              potential on back
                                                                                                                of improved
  Sector coupling                                                                                               regulation
          Electrification of e.g. heating, cooling and transport via heat
            pumps and electric cars
          DSO is in a preferred role enabling a system-optimal use          2011                  2016                           >2020
            since all this equipment is connected to the DSO networks
                                                                                                                                          9
E.ON Delivering step by step
CS: Very good progress and growth also from
           asset-backed solutions
District Heating / B2M
                                                                                              Heat contributes ~20% of Customer Solutions EBIT
  Strong district heating business in Sweden, Germany, UK with yearly EBIT of ~€130m
  Stable and resilient earnings profile often based on network assets
                                                                                                          €130m
  New €250m capex project in Högbytorp close to Stockholm to be finalized
   in 2019; 100 MW CHP plus district heating network extension                                                    ROCE: >10%

Energy Solutions B2B                                                                          Order intake to pick up significantly

  Focus on industrial generation (6-120 MW CHPs), on-site generation solutions
   (small/medium CHPs, PV), energy and CO2 efficiency and flexibility                                         >€1bn

  Order intake1 YTD of ~€0.4bn on track to double order intake to >€1bn yoy in 2017
                                                                                                2015   2016   2017
E-Mobility
    Leading E-Mobility player in Denmark (>50% market share)
    Established strong partnerships (e.g. Clever and Sixt)
    Roll-out of service offerings to other E.ON markets
    Aim for leading role in developing role in developing Europe’s charging infrastructure
1. TCV: Total contract value                                                                                                                     10
Renewables: Risk & return focus

Focus on PPA and FiT secured pipeline
US onshore
       Safe-harbored pipeline of > 3,000MW with 100% PTC
        support
       New project Stella (201MW) with FID expected in Q3-17
       ~500 MW on track for completion in 2017                                                                             3.2 GW

Europe onshore
       Opportunistic approach
       Recent example: FID on Morcone in Italy (57 MW, FiT of 66
        €/MWh for 20 years)                                                                                 2.1 GW
       Several hundred MW potential (e.g. in Scotland and Sweden)
                                                                                             Highlights
                                                                                             5.3 GW Operated capacity1
Offshore
       Stringent risk & return discipline                                                   4.6 GW Owned capacity2
       ~800MW on schedule to be operational in 2018/19                                          1.1 GW Offshore capacity
                                                                                                 3.5 GW Onshore + PV capacity
1. Operated sites, where E.ON is the operator, regardless the ownership share, 2. Pro rata                                           11
Embedding operational excellence and establishing a
strong performance culture: the Phoenix project
Scope                                               Targets                                                Phoenix well on track
                                                                                                                                                                     €400m
Controllable cost1 baseline
  € bn                                              • Phoenix target: €400 m EBIT
                                                      contribution p.a. from 2018 onwards
         5.3                                                                                                                                        ~€300m
                                                        • About €300 m predominantly
                                                          from central overhead & support                                               ~€40m
                      4.1                                                                                                  ~€30m
                                                          functions                                          ~€30m

                                                        • Restructuring of pension plans &                   H1 2017      Q3 2017      Q4 2017        2018           Total
                                     1.2                  other measures deliver ~€100 m
                                                                                                                                Beyond Phoenix

                                                                                                             Performance Culture to be sustainably embedded
                                                                                                             across all functions
   Total E.ON                     Costs in
                                  scope of                                                                   • Focus on operational excellence
                                  Phoenix                                                                    • Improve customer centricity
                                                                                                             • Digitization to improve processes and customer
                                                                                                               experiences
1. Controllable Costs include operational costs that management can meaningfully influence, such as material expenses, consultancy and personnel expenses. Margin-
effective components such as fuel costs as well as cost item that are largely uncontrollable by the management are not included.                                             12
Outlook 2017 confirmed
                                        Outlook 2017              Effects for the remainder of 2017
                                                                     Energy     +   Regulatory effects (e.g. pensions),
                                                                    Networks        lower maintenance costs
                                                   €2.8-3.1 bn                  +   Tariff increase in Sweden
                                                                                +   Positive development in CEE
                                                                    Customer
                                                                                + Price increases in Germany & UK, focus
                                        EBIT1                       Solutions
                                                                                  on efficiency
                                                                                – Competitive dynamics in UK

                                                                   Renewables

                                                                                +   Normalizing wind yields
                                                   €1.2-1.45 bn
                                        Adj. Net
                                        Income1                                 – Lower hedging prices
                                                                                – Additional depreciation of asset
                                                                                  retirement costs

                                                                                                                          13
1. Adjusted for non operating effects
E.ON Focus – Our basis for steering the company

                                                                                                                          • Update of E.ON Focus with FY 2017
                                                                                                                            results
                                                                                                                          • Increased payout ratio to minimum of
                                                                                                                            65%4
                                                                                                                          • Striving for payout ratio in line with
                                                                                                                            peers (specification of exact range with
                                                                                                                            FY 2017 results)
                                                                                                                          • Target of absolute dividend growth
                                                                                                                            (base year 2017)
                                                                                                                          • Strong alignment of management and
                                                                                                                            investors

E.ON KPIs without Uniper contribution, 1. Adjusted for extraordinary effects and divested operations, FY 2017 guidance range as basis for medium-term outlook, 2. OCFbIT   14
divided by EBITDA, 3. Based on EBIT (= pre-tax), 4. Based on Adjusted Net Income, from FY 2018 (payable in 2019) onwards, 5. Total Shareholder Return
Segments
Energy Networks at a glance

Highlights                                                                                    EBIT1 in m€                            +18%
   Germany                                        EBIT 9M 20171,2
                                                                                                                                                1.417
                                                                                                                 1.196
   + Regulatory benefits
                                                                                                Germany                                          788
   + Lower maintenance cost                                                                                          638
                                                            70%                                  Sweden
   Sweden                                                                                                         288                            345
                                                                                             CEE & Turkey
   + Tariff increases                                                                                             270                            284

   CEE & Turkey                                                                                                9M 2016                         9M 2017
   + Positive effects in Czech Republic, Hungary                                              Further key financials1 in m€
   – One-off effect (book loss on hydro power plant                                                                                    2.973
                                                                                                                               2.601
     divestment), low hydro flows and FX in Turkey
                                                                                                       1.923 2.135

                                                                                                                                                  866    864

                                                                                                            EBITDA               OCFbit3           Economic
                                                                                                                                                 Investments
1. Adjusted for non operating effects 2. Does only cover the three core businesses, Energy              9M 2016            9M 2017
Networks, Customer Solutions and Renewables 3. Operating cash flow before interest and
taxes.                                                                                                                                                         16
Energy Networks: E.ON has a strong
European regulated asset base
Well diversified footprint                                     Presence in countries with AAA rating/ catch-up potential
Regulated asset base (€ bn)                                    EBIT 2016 (€ bn)                                                      ~ 23%
                                                                                                        ~ 24%
                                                                           ~ 54%                                                       0.4                           1.7
   Sweden                           Germany                                 0.9                          0.4                            IG4
                                                                                                         AAA
   €3.9 bn2                         €10.7 bn
                                                                            AAA

                                                                           GER                          SWE                           CEE 5                        Total
                                                                           % of Total Energy Networks EBIT

                   ~€19 bn1                                    E.ON operates 858,000 networks km
                                                                                                        GER            SWE             CEE3
                                                                Distributed             Power              68              37             45
                                                                volumes (TWh)6            Gas            107                5             44
      CEE (CZE, SVK, HUN, ROM)                                  Grid length             Power            349             136             269
      €4.4 bn3                                                  (‘000 km)                 Gas              58               2             44
1. Current total 2016 RAB of country/region - In general, RABs from different regulatory regimes are not directly comparable due to significant methodical differences.
These include for example different regulatory asset lifetimes, asset valuation methods, or treatment of customer contributions for network connections. 2. Converted at   17
SEK/EUR rate of 9.46, 3. Hungary converted at EUR/HUF of 311.4, Czech Republic converted at EUR/CZK of 27.0, and Romania converted at EUR/RON of 4.5; Including
100% of Slovakia, not including Turkey , 4. IG = Investment Grade; Except of Hungary and Turkey, 5. Including at equity income from Slovakia and Turkey, 6. Volumes
including grid losses
Predictable earnings generated from RAB-
based returns
Pro-forma allowed WACC as solid base1                                                                   Regulatory stability in the near term
                                                                                                        Start of next regulatory period (Power)

                                                                                                          2017
        Germany                             5.9%2
                                                                                                                                                                         % of Total EBIT 2016
                                                                                                          2018
         Sweden                            4.56%3
                                                                                                          2019

             CEE                     4.7% - 8.0%4                                                                                                                              ~90%

                                                                                                          2020

1. Power WACC for latest regulatory period. In general, allowed WACCs from different regulatory regimes are not directly comparable (even if they are adjusted for pre-tax/post-tax of
real/nominal) because they are applied on RABs that are derived from different regulatory accounting rules, 2. Pro-forma calculated, nominal WACC, pre corporate tax and pre commercial
tax. Instead of using a WACC-approach the German regulator publishes allowed equity returns. WACC figures for existing (Return on equity: 7.14% pre corporate tax and after commercial
tax) and new investments (Return on equity: 9.05% pre corporate tax and after commercial tax) are assuming c. 4% cost of debt and a 60/40 debt/equity capital structure. The pro-forma          18
WACC figure of 5.9% is then derived by weighting the share of existing assets (WACC: 5.7%) and new assets (WACC: 6.5%), 3. Pre-tax real WACC for Sweden of 4.56%; Current WACC
challenged in court by network operators, 4. Hungary: pre-tax real WACC 4.69%, Czech Republic: pre-tax nominal WACC 7.951%, Romania: pre-tax real WACC 7.7%, Slovakia: pre-tax
nominal WACC 6.47%
Customer Solutions at a glance

Highlights                                                                                   EBIT1 in m€                         -36%
   Germany                                         EBIT 9M 20171, 2                                          548

   + Price increase in Q2 2017                                                                Germany            144
                                                                                                                                           353
   – Lower power margins due to                     17%                                           UK             227                       93
     increased TSO fees                                                                                                                     144
   – Lower gas margin due to                                                                    Other            177                        116
     price decrease in Nov 2016
                                                                                                           9M 2016                        9M 2017
   UK
   + Stabilizing customer numbers & price increases in Q2                                    Further key financials1 in m€
                                                                                                                           1.140
     2017
   – FX weakening after Brexit decision & price cap on PPM                                          763                             732
                                                                                                            584
     customers                                                                                                                               392    350
   Other
   – Energy procurement crisis in Romania in Q1 2017
                                                                                                        EBITDA               OCFbit3          Economic
   – Higher gas procurement costs in Eastern Europe                                                                                         Investments
                                                                                                    9M 2016            9M 2017
1. Adjusted for non operating effects 2. Does only cover the three core businesses, Energy
Networks, Customer Solutions and Renewables 3. Operating cash flow before interest and                                                                    19
taxes.
Customer Solutions: Introducing new
solutions
E.ON Aura: PV & storage                          B2B Large: continuously gaining traction          E-mobility: gearing up

   All-in-one solution including PV, battery,      Significant sales growth with tailor-            Established dedicated unit to take
    energy management app, service &                 made energy solutions (on-site                    leading role in developing Europe’s
    guarantee package and green electricity          generation, energy efficiency, flexibility,       charging infrastructure
    tariffs                                          storage,…)
                                                                                                      E.ON has extensive experience in e-
   Successful launch and scaling up across         Diversified portfolio of customers (auto          mobility  market leader in Denmark
    Germany                                          suppliers, tires, chemical, retail,…)             (2,500 charging points)
   Introduction of virtual storage product         Innovative solutions like e.g. fuel cells &      Data-based development of services for
    E.ON SolarCloud                                  battery storage                                   further markets
   10x increase in unit sales in 2016              2017 ambition: new contracts with                Partnerships with car rental company
     Target 2017: 10-15% market share               several hundred million in total revenues         Sixt and e-mobility specialists          20
Customer Solutions addresses customer
needs across different segments

    B2C &
   B2B SME           Energy Sales
                      Power & Gas

                         Heat
                     District Heating,
  B2B Large           Local Heating
   & B2M
                    Foundation           New Solutions
                                                         21
Customer Solutions: Financial highlights

Adjusted EBIT1 by business pillars
€bn

  Energy sales             2016            0.3                 0.3          ~0.71                        Energy sales financials
                                                                                                         €bn
                                                                                                                          Gross Margin

  Heat                     2016                                              0.1                         2016            1.2                  1.3

                                                                                                                               OPEX2
  Total Adj. EBIT          2016                          0.8                                             2016           0.8                   1.0

                                         UK         Continental Europe

1. Adjusted for non-operating earnings; Slight differences may occur due to rounding, 2. Costs to serve, costs to acquire and all other cost related to running the energy
sales business including D&A                                                                                                                                                 22
Renewables at a glance

Highlights
                                                  EBIT 9M 20171, 2                           EBIT1 in m€                                -20%
   Offshore
                                                      12%                                                           309
   – Arkona book gain in                                                                     Onshore/Solar              66                        248
      Q2 2016                                                                                                                                     62
   – Low wind conditions in
                                                                                             Offshore/Other             243
      the UK                                                                                                                                       186

   Onshore
   + COD of Colbeck’s Corner in May 2016                                                                          9M 2016                        9M 2017

   + Higher production of US wind farms & better wind                                        Further key financials1 in m€
     conditions in Europe                                                                                                                                  961

                                                                                                          584                                       637
                                                                                                                   508            525      540

1. Adjusted for non operating effects 2. Does only cover the three core businesses, Energy                     EBITDA               OCFbit3          Economic
Networks, Customer Solutions and Renewables 3. Operating cash flow before interest and                                                             Investments
taxes.                                                                                                        9M 2016         9M 2017                            23
E.ONs capabilities in most attractive
technologies and markets
Geography                             Technology                                  Business model

                        2.1 GW           Wind Onshore
                                                              Wind Offshore

                                                 PV

         3.2 GW

• Focus on Europe & North America     • Focus on Onshore wind, off-shore wind &   • Integrated renewables player
                                        utility-scale PV
• Stable countries / low-risk                                                     • Portfolio optimization strategy, bringing:
                                      • Strong E.ON capabilities and experience
• Still attractive returns achieved                                                  -   Scale advantages
                                      • Capture trends in line with E.ON’s           -   Maintain capabilities
                                        capabilities / markets
                                                                                     -   Value creation
                                                                                     -   Reduce cluster risk
                                                                                                                                 24
Segments: PreussenElektra                                                                                                                  E.ON 9M 2017 results

Highlights                                                                                                                  +3%

   – Lower volumes due to Brokdorf outage                                                EBIT1 in m€          345                          357
   – Lower achieved power prices
   – Additional depreciation of asset retirement costs
     (ARC)                                                                                  Germany
   + End of nuclear fuel tax payments in 2016
   + One-off effects in relation to court case & KFK
     solution                                                                                               9M 2016                      9M 2017

                                                                                         Further key financials1 in m€
                                                                                                             497
 Hedged Prices Germany (€/MWh) as of 30 Sept 2017                                                     410
                                                                                                                          259
  2016                              100%                                         37
                                                                                                                                              12      10
  2017                              100%                               32
  2018                               94%                      27
                                                                                                                                -7.069
  2019                               62%                        28
                                                                                                       EBITDA               OCFbit2            Economic
                                                                                                                                             Investments    25
                                                                                                      9M 2016         9M 2017
1. Adjusted for non operating effects 2.Operating cash flow before interest and taxes.
PreussenElektra: Asset overview

Geographic presence in Germany                                                                Overview nuclear plants

           Brunsbüttel
                         Brokdorf
              Stade             Krümmel
        Unterweser

                             Hannover
       Emsland

                             Grohnde
                         Würgassen

            Grafenrheinfeld

                                Isar 1/2
           Gundremmingen A/B/C

    Active and operated by       Active and minority share
    PreussenElektra              PreussenElektra
    Shut down                    Decommissioning

1. Atomgesetz, 2. Start-up year 1971, transfer to Preußische Elektrizitäts-Aktiengesellschaft in 1975                   26
Nuclear decommissioning is no limitation for dividends
or capex
 € bn                                                    Current approach
                                                         • Nuclear decommissioning provisions are part of E.ON’s economic net debt (END)
 Current
                                 ~0.4-0.6
                                                         • Utilization of nuclear provisions is currently part of operating cash flow and thus
                                                           implies a burden for the financial leeway
                EBITDA1          Utilization   OCF bIT
                                 of nuclear
                                 provisions

                                                         Economic view
                                                         • However, economically the utilization is comparable to a redemption of debt and
                                                           thus has features of financing cash flow
Economic                                                 • Nuclear decommissioning could therefore be paid and replaced with financial debt
  view                                                     (END neutral) and is thus no limitation for dividend or capex
               EBITDA1                         OCF bIT

1. Adjusted for non operating effects                                                                                                        27
Discount rates for nuclear provisions

 Build up of provisions status quo                                                             Build up of provisions post KFK1
   Real discount rate:                                                                            Real discount rate:
           +0.9%                                                                                        -0.9%
  Total costs
     in t0                                                                                     Total costs
                                                                                                  in t0

        t0
                                                                                                  t0

                       t+1      t+2     t+3                              t+100                                     t0     t+1   t+2       t+n
         Accretion           Storage       Decommissioning                                             Accretion        Decommissioning

Duration effect
  • Remaining provisions with shorter duration
  • Real discount rate of -0.9% (2015: +0.9%) increases provisions to €11.2 bn (new END definition: €10.1 bn2 with real discount rate of 0.0%)
1. Utilization not taken into account, 2. Current cost value used for FY 2016 END definition                                                     28
KFK solution with positive impact on
adjusted net income
 1. Nuclear fund (KFK)                                            2. Discount rates                                          3. Additional asset retirement cost (ARC)
Storage related provisions, € bn               ~10                Decommissioning provisions, € bn                            ARC € bn
                                                                                                               11.2            1.0
       7.8         2.0           0.2                                9.4                  9.7
                                                                              0.3                   1.5

    Provisions   Premium1      Provision     Payment              FY 2015   Net accr. 9M 2016 Increase of FY 2016                2016   2017     2018     2019      2020     2021        2022
                             interest cost   Amount1                         charge            provisions

                                                              •     Remaining provisions with shorter duration               •    Duration effect increases Asset Retirement
•    Payment amount has been transferred to                   •     Real discount rate of -0.9% (2015: +0.9%)                     Costs (ARC)
     government fund on July 3rd 2017                               increases provisions to €11.2 bn (new END                •    Additional ARC are capitalized as of Q4 2016
                                                                    definition: €10.1 bn3 with real discount rate of         •    Annual depreciation over remaining lifetime of
                                                                    0.0%)                                                         nuclear plants

•    Accretion of interest (4.4% p.a.) on €7.8 bn             •     Reduces accretion charges by ~€350 m4 p.a.               •    Reduces non-core EBIT by ~€185 m p.a.
     stops as of 1 Jan 2017                                   •     Accretion charges based on risk free rate5
•    Increases net income by ~€200-250 m2 p.a.                •     Quarterly fluctuations of provisions
                                                                                                                                                                                    29
1. Excluding €0.2 bn for minority shareholders, 2. Net effect, depending on refinancing costs, 3. Current cost value used for FY 2016 END definition, 4. Depending on discount
rate to be applied, 5. Risk-free discount rate of ~0.5%
Financials
9M 2017 Results
9M 2017 Results
        8th November 2017
Solid 9M 2017: well on track to achieve FY 2017 target
                                                                                                          E.ON 9M 2017 results

  Highlights                                             Key Financials1
                                                         €m

        Solid EBIT development: + 13% Q3 2017 vs              3,640     3,540
        Q3 2016

        Adj. Net Income up ~50% YoY
                                                                                          2,311
                                                                                                  2,117
        Economic Net Debt reduced to €19.7 bn
        (vs. €21.5 bn in H1 2017)
                                                                                                                    965
        FY 17 guidance confirmed:
                                                                                                           641
        EBIT €2.8-3.1 bn, Adj. Net Income €1.2-1.45 bn

                                                                 EBITDA                       EBIT        Adj. Net Income

                                                              9M 2016           9M 2017                                     32
1. Adjusted for non operating effects
Catch-up continues in Q3 2017                                                                                                               E.ON 9M 2017 results

 EBIT1 9M 2017 vs. 9M 2016                                                                Key 9M Effects
  €m
9M 2016 w/o                                                                                   Energy
                                                         2.282                                           +   Higher regulated revenues in Germany and
div. operations                                                                              Networks
                                                                                                             CEE
       Energy                                                                                            +   Tariff increases in Sweden
                                                              221
     Networks
                                                                                             Customer    + Price increases in Germany and UK
     Customer                                                                                Solutions   – Higher costs (e.g. ECO2), PPM3 cap,
                                                              -195
      Solutions                                                                                            competitive dynamics in UK, Energy
                                                                                                           procurement crisis in Romania (Q1 2017)
   Renewables                                         -61               165
                                                                                            Renewables
Corp. Functions
       & Other,                              -142                                                        – Arkona book gain in Q2 2016 (offshore)
  Consolidation
      Preussen
       Elektra                        12                                                                 – Lower prices & volumes, additional
                                                                                                           depreciation of asset retirement costs (ARC)
      9M 2017                               2.117                                                        + End of nuclear fuel tax, one-off effects in
                                                                                                           relation to court case & KFK solution
                                                                                                                                                             33
1. Adjusted for non operating effects, 2. Energy Company Obligation (ECO) 3. Prepayment Meter (PPM)
Adjusted Net Income supported by lower interest                                                                                       E.ON 9M 2017 results

accretion and taxes
  9M 2017
  €m

 Group EBIT1                                                                        2.117

  Interest on                                                                                ~€ 55m decline yoy mainly due to lower interest income
  fin. assets/                                                          -522
    liabilities2
Other interest                                                                               ~€600m improvement yoy mainly due to significant
                                                            -53
     expenses                                                                                lower interest accretion of nuclear provisions and other
                                                                                             interest expenses
Profit before
                                                                  1.542
       Taxes1

Income Taxes                                            -386                                 Tax rate of 25% (vs. 32% in 9M 2016)

    Minorities                          -191
                                                                                             Adjusted net income up 51% over prior year
    Adjusted
                                                965
 Net Income1
                                                                  €0.46 EPS (€ per share)
                                                                                                                                                        34
1. Adjusted for non operating effects, 2. Without interest accretion of nuclear provisions
END improves significantly due to high cash flow and                                                                                                          E.ON 9M 2017 results

refund of nuclear fuel tax
 END1 9M 2017 vs. FY 2016
 € bn
                                                                                       +6.6

                                                                                                                                                                         -11.2
                          Operating Cash Flow:
                                                                                                                                                                          -3.6
    -21.4                         -3.3
                                                                                                                                                                          -4.9
                                                                                                                                                            0.6
                                   3.4                                                                                                                                   -19.7
     -4.0
                    3.5                          -10.3                                                                                      10.2
     -0.9
    -26.3                                                                       1.35                                          0.4
                                                                                                               0.2
                                                                 -2.2
                                                                                               -0.5
   END FY          OCF2       Cash impact    KFK     Investments               ABB5         Dividend     Divestments       Pensions        AROs6          Others        END 9M
    2016                        of NFT    payment to                                                                                                                     2017
                                refund3 government
                                            fund4
      AROs         Pension provisions          Net financial position

1. Economic net debt definition takes into account the decommissioning provisions calculated with a real discount rate of 0.0% as opposed to IFRS ARO’s. 2. OCF adjusted for     35
KFK and NFT effects, 3. Nuclear Fuel Tax (NFT) including positive interest income effect, before taxes and payment to minorities 4. Kommission zur Überprüfung der
Finanzierung des Kernenergieausstiegs (KFK), 5. Accelerated Book Build (ABB), 6. Includes transfer of nuclear storage liabilities to government fund
Appendix
Financial Details
Appendix: Table of Contents          E.ON 9M 2017 results

38                 39
      Financial         Cash
      Highlights        Conversion

40                 41
      Energy            Customer
      Networks          Solution

42                 43
                        Preussen
      Renewables
                        Elektra

44
      Financial
      Appendix
                                                      37
Financial Highlights                                                                                                                    E.ON 9M 2017 results

                                                                                        EBIT                                   Adj. Net Income
                                                                                        • Energy Networks: +18% YoY.           • €324 m above last years
                                                                                          Higher regulated revenues in           9M result
  €m                             9M 2016           9M 2017         % YoY
                                                                                          Germany and CEE and tariff           • Improvement YoY mainly
                                                                                          increases in Sweden                    driven by significant lower
 Sales                             28,198            27,937             -1              • Customer Solutions: -36% YoY.          interest accretion of
            1                                                                             Lower margins and increased            nuclear provisions, other
 EBITDA                             3,640             3,540             -3
                                                                                          competitors dynamic                    interest expenses and a tax
 EBIT
        1
                                    2,311             2,117             -8              • Renewables: -20% YoY.                  rate of 25% (vs. 32% in 9M
                       1                                                                  Arkona book gain in Q2 2016 and        2016)
 Adjusted net income                  641               965           +51
                                                                                          lower wind conditions
 OCF bIT                            3,827            -3,091          -181
                                                                                                                               Investments
 Investments                        1,981             2,222           +12                  OCF bIT                             • Energy Networks: €864 m
                                                                                           • Cash provided by operating          (vs. €866 m YoY)
 Economic net debt ²               26,320            19,699           -25
                                                                                             activities €6.3 bn below prior-   • Customer Solutions: €350
                                                                                             year level                          m (vs. €392 m YoY)
                                                                                           • Key drivers: €10.3 bn payment     • Renewables: €961 m
                                                                                             to nuclear fund (KFK3) (-) and      (vs. €637 m YoY )
                                                                                             €3.4 bn4 nuclear fuel tax (NFT)
1. Adjusted for non operating effects, 2. Economic net debt as per 31 Dec 2016 and 30        refund (+)
Sept 2017; Economic net debt definition takes into account the decommissioning
provisions calculated with a real discount rate of 0.0% as opposed to IFRS ARO’s 3.
Kommission zur Überprüfung der Finanzierung des Kernenergieausstiegs (KFK) 4. Nuclear                                                                    38
Fuel Tax (NFT) including positive interest income effect, before taxes and payment to
minorities
High cash conversion rate2 of 120% supported by                                                                                                               E.ON 9M 2017 results

strong operating cash flow
  9M 2017
 € bn
                                   +120%

                                                                  4.2

        3.5                                   0.9                                    -0.3                                    3.5
                                                                                                         -0.3
                          -0.2
                                                                                                                                                -2.2

                                                                                                                                                                    1.3

    EBITDA1              Cash           Changes in WC          OCF bIT4            Interest         Tax Payments             OCF               Capex                FCF
                     Adjustments3                                                 Payments

1. Adjusted for non operating effects, 2. Cash Conversion Rate: OCF bIT / EBITDA, adjusted for NFT and KFK effects, 3. Net non cash effective EBITDA items incl. provision     39
utilizations, 4. Adjusted for KFK and NFT effects
Segments: Energy Networks                                                                                                                                            E.ON 9M 2017 results

  Energy Networks                                                                                     Highlights
   EBIT1 € m                                +18%                                                  • Germany:
                                                                                                    + Regulatory effects
                                                       1,417                                        + Lower maintenance costs
                                1,196
                                                                                                  • Sweden:
                                                        788
            Germany               638                                                               + Tariff increases
                                                                                                  • CEE & Turkey:
             Sweden               288                   345
                                                                                                    + Tariff increases in Hungary
  CEE & Turkey                    270                   284                                         + Higher allowed revenues in Czech Republic & Romania
                              9M 2016                 9M 2017

           €m                                          Germany                      Sweden                        CEE & Turkey                      Total
                                            9M 2016    9M 2017    % YoY   9M 2016   9M 2017   % YoY     9M 2016     9M 2017      % YoY   9M 2016   9M 2017   % YoY
          Revenue                            10,288     10,797       +5       736       831     +13       1,183        1,239        +5    12,207    12,867      +5
Details

                  1
           EBITDA                             1,084       1,217     +12       411       467     +14         428          451        +5     1,923     2,135     +11
           EBIT 1                               638         788     +24       288       345     +20         270          284        +5     1,196     1,417     +18
           thereof Equity-method earnings        54          60     +11         0         0       -          47           -7      -115       101        53     -48
           OCFbIT                             1,809       2,106     +16       398       443     +11         394          424        +8     2,601     2,973     +14
          Investments                           517         396     -23       180       228     +27         169          240       +42       866       864      -0

                                                                                                                                                                                      40
1. Adjusted for non operating effects
Segments: Customer Solutions                                                                                                                                    E.ON 9M 2017 results

  Customer Solutions                                                                                  Highlights
   EBIT1 € m                                                                                      • Germany:
                                            -36%
                                                                                                    – Lower power margins due to increased TSO2 fees (Q1 2017)
                                  548                                                               – Lower gas margin due to price decrease in Nov 2016
           Germany                144                                                               + Price increases as per Q2 2017
                                                       353
                                                                                                  • UK:
                      UK          227                  93
                                                                                                    – Higher ECO3 costs & FX weakening
                                                        144
                                                                                                    – Price cap on PPM4 customers
                Other             177                   116                                         – Competitive dynamics
                              9M 2016                 9M 2017                                     • Other:
                                                                                                    – Energy procurement crisis in Romania in Q1 2017

           €m                                          Germany                        UK                           Other                       Total
                                            9M 2016    9M 2017    % YoY   9M 2016   9M 2017   % YoY     9M 2016   9M 2017   % YoY   9M 2016   9M 2017   % YoY
          Revenue                             5,526       5,424      -2     5,676     5,083     -10       4,877     4,972      +2    16,079    15,479      -4
Details

                  1
           EBITDA                               192         147     -23       297       218     -27         274       219     -20       763       584     -23
           EBIT 1                               144          93     -35       227       144     -37         177       116     -34       548       353     -36
           thereof Equity-method earnings         0           0       -         0         0       -           8        11     +38         8        11     +38
           OCFbIT                               352         226     -36       283       229     -19         505       277     -45     1,140       732     -36
          Investments                            47          42     -11       158       142     -10         187       166     -11       392       350     -11

                                                                                                                                                                                 41
1. Adjusted for non operating effects 2. Transmission system operator (TSO) 3. Energy Company Obligation (ECO) 4. Prepayment meter (PPM)
Segments: Renewables                                                                                                                                       E.ON 9M 2017 results

  Renewables                                                                                              Highlights
   EBIT1 € m                                                                                             • Offshore:
                                            -20%
                                                                                                           – Arkona book gain in Q2 2016
                                309                                                                        – Lower wind conditions in UK, FX (GBP) weakening
                                                      248                                                • Onshore:
Offshore/Other                   243                                                                       + COD of Colbeck’s Corner in May 2016
                                                      186                                                  + Higher production of US wind farms
                                                                                                           – Lower wind conditions in Europe (esp. Italy & UK)
 Onshore/Solar                   66                    62

                             9M 2016               9M 2017

           €m                                     Onshore Wind / Solar              Offshore Wind / Others                  Total
                                            9M 2016    9M 2017         % YoY   9M 2016    9M 2017        % YoY   9M 2016   9M 2017   % YoY
          Revenue                               567        691           +22       455         439          -4     1,022     1,130     +11
Details

                  1
           EBITDA                               229        209            -9       355         299         -16       584       508     -13
           EBIT 1                                66          62           -6       243         186         -23       309       248     -20
           thereof Equity-method earnings                                                                             11        18     +64
           OCFbit                                                                                                    525       540      +3
          Investments                                                                                                637       961     +51

                                                                                                                                                                            42
1. Adjusted for non operating effects
Segments: PreussenElektra                                                                                                            E.ON 9M 2017 results

  PreussenElektra                                                               Highlights
   EBIT1 € m                                                                     – Lower volumes due to Brokdorf outage
                                       +3%
                                                                                 – Lower achieved power prices
                         345                     357                             – Additional depreciation of asset retirement costs (ARC)
                                                                                 + End of nuclear fuel tax payments in 2016
                                                                                 + One-off effects in relation to court case & KFK solution

                     9M 2016                  9M 2017

                                                                                Hedged Prices Germany (€/MWh) as of 30 Sept 2017
           €m                                          PreussenElektra
                                             9M 2016      9M 2017       % YoY   2016                      100%                                   37
          Revenue                              1,068         1,230        +15
Details

           EBITDA 1                              410           497        +21   2017                      100%                          32
                1
           EBIT                                  345           357         +3
           thereof Equity-method earnings         50            44        -12   2018                       94%                 27
           OCFbIT                                259        -7,069     -2,829
          Investments                             12            10        -17   2019                       62%                  28

                                                                                                                                                      43
1. Adjusted for non operating effects
Adjusted Net Income                                                                      E.ON 9M 2017 results

  €m                                    9M 2016   9M 2017   % YoY
                                                                    Economic interest
             1
                                          3,640     3,540      -3
  EBITDA
                                                                    expense (net)
  Depreciation/amortization              -1,329    -1,423      -7   • Improvement mainly driven
         1
                                          2,311     2,117      -8
                                                                      by significant lower
  EBIT
                                                                      interest accretion of
  Economic interest expense (net)        -1,118      -575     +49     nuclear provisions and
        1
                                                                      other interest expenses
  EBT                                     1,193     1,542     +29
                         1
  Income Taxes on EBT                      -387      -386      +0

  % of EBT   1
                                          -32%      -25%        -   Tax rate
                                                                    • Tax rate of 25% (vs. 32%
  Non-controlling interests                -165      -191     -16
                                                                      in 9M 2016)
                         1
  Adjusted net income                      641       965      +51

                                                                                                          44
1. Adjusted for non operating effects
Reconciliation of Adj. EBIT to                                                             E.ON 9M 2017 results

IFRS Net Income
  €m                                                           9M 2016   9M 2017   % YoY
            1
 EBITDA                                                          3,640     3,540      -3
  Depreciation/Amortization/Impairments                         -1,329    -1,423      -7
        1
 EBIT                                                            2,311     2,117      -8
  Economic interest expense (net)                               -1,118      -575     +49
  Net book gains                                                    1       288      n/a
  Restructuring                                                   -221      -173     +22
  Mark-to-market valuation of derivatives                         768       -453    -159
  Impairments (net)                                                -44        5     +111
  Other non-operating earnings                                     -79     3,298     n/a
  Income/Loss from continuing operations before income taxes     1,618     4,507    +179

  Income taxes                                                    -624      -604      +3
  Income/loss from discontinued operations, net                -10,293        0     +100
  Non-controlling interests                                     -5,351      197     +104
  Net income/loss attributable to shareholders of E.ON SE       -3,948     3,706    +194

                                                                                                            45
1. Adjusted for non operating effects
Cash effective investments                                          E.ON 9M 2017 results

by unit

  €m                                    9M 2016   9M 2017   % YoY
  Energy Networks                          866       864       -0
  Customer Solutions                       392       350      -11
  Renewables                               637       961     +51
  Corporate Functions & Other               78        42      -46
  Consolidation                              -4        -5     -25
  PreussenElektra                           12        10      -17
  Investments                             1,981     2,222    +12

                                                                                     46
1. Adjusted for non operating effects
Economic Net Debt1                                                                      E.ON 9M 2017 results

  €m                                     31 Dec 2016     30 June 2017    30 Sept 2017
 Liquid funds                                  8,573          14,252            5,450
 Non-current securities                        4,327            3,850           3,801
 Financial liabilities                       -14,227          -14,691         -14,304
 Adjustment FX hedging ²                         390             311              158
 Net financial position                         -937            3,722          -4,895
 Provisions for pensions                      -4,009           -3,748          -3,586
 Asset retirement obligations                -21,374          -21,459         -11,218
 Economic net debt                           -26,320          -21,485         -19,699

1. Economic net debt definition takes into account the decommissioning provisions
calculated with a real discount rate of 0.0% as opposed to IFRS ARO’s, 2. Net figure;                    47
does not include transactions relating to our operating business or asset management
Economic interest expense (net)                                                                                          E.ON 9M 2017 results

                                                                                                            Difference
 €m                                                                           9M 2016         9M 2017
                                                                                                             (in € m)
 Interest from financial assets/liabilities                                       -467            -522             -55
 Interest cost from provisions for pensions and similar provisions                  -64            -61              +2
 Accretion of provisions for retirement obligation and similar provisions         -647             -49           +597

 Construction period interests¹                                                      29             29              +0
 Others                                                                              31             29              -2
 net interest result                                                            -1,118            -575           +543

1. Borrowing cost that are directly attributable to the acquisition, construction or production of a qualified asset.
Borrowing cost are (virtual) interest costs incurred by an entity in connection with the borrowing of funds. (interest                    48
rate: 5.6%)
Financial Liabilities                                                                                                                                E.ON 9M 2017 results

             Split Financial Liabilities                                   Maturity profile (as of end 9M 2017)1
             € bn                                                          € bn
                                                                                                                                                       4.8
                                                 30 Sept
                                                   2017
               Bonds                                -12.5
              in EUR                                  -5.7
              in GBP                                  -3.9
              in USD                                  -2.5
                                                                                        2.1
              in JPY                                  -0.2                   1.8
              in other denominations                  -0.2                                                 1.4
               Promissory notes                      -0.4                                           1.1
                                                                                                                    0.8
               Commercial papers                      0.0                                                                                     0.6
                                                                                                                                        0.4
               Other liabilities                     -1.4                                                                     0.1
               Total                                -14.3
                                                                            2017        2018    2019       2020    2021      2022      2023   2024   ≥2025
                                                                                  EUR         GBP         USD      YEN         Other

                                                                                                                                                                      49
1. Bonds and promissory notes issued by E.ON SE, E.ON International Finance B.V. and E.ON Beteiligungen GmbH (fully guaranteed by E.ON SE)
Appendix
Contacts, Calendar & Disclaimer
E.ON Investor Relations contacts

        Alexander Karnick            T+49 (201) 184 28 38
        Head of Investor Relations   alexander.karnick@eon.com

        Martina Burger               T +49 (201) 184 28 07
        Manager Investor Relations   martina.burger@eon.com

        Dr. Stephan Schönefuß        T +49 (201) 184 28 22
        Manager Investor Relations   stephan.schoenefuss@eon.com

        Andreas Thielen              T +49 (201) 184 28 15
                                                                   T +49 (201) 184 2806
        Manager Investor Relations   andreas.thielen@eon.com       investorrelations@eon.com

                                                                                               51
Financial calendar & important links

                      Financial calendar
                      March 14, 2018               Annual Report 2017

                      May 8, 2018                  Interim Report I: January – March 2018

                      May 9, 2018                  2018 Annual Shareholders Meeting

                      August 8, 2018               Interim Report II: January – June 2018

                      November 14, 2018            Interim Report III: January – September 2018

                      Important links
                      Presentations                https://www.eon.com/en/investor-relations/presentations.html

                      Annual Reports               https://www.eon.com/en/investor-relations/financial-publications/annual-report.html

                      Interim Reports              https://www.eon.com/en/investor-relations/financial-publications/interim-report.html

                      Shareholders Meeting         https://www.eon.com/en/investor-relations/shareholders-meeting.html

                      Bonds / Creditor Relations   https://www.eon.com/en/investor-relations/bonds.html

                                                                                                                                          52
Disclaimer

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This document is being presented solely for informational purposes. It should not be treated as giving investment advice, nor is it intended to provide the
basis for any evaluation or any securities and should not be considered as a recommendation that any person should purchase, hold or dispose of any
shares or other securities.
This presentation may contain forward-looking statements based on current assumptions and forecasts made by E.ON management and other information
currently available to E.ON. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future
results, financial situation, development or performance of the company and the estimates given here. E.ON does not intend, and does not assume any
liability whatsoever, to update these forward-looking statements or to conform them to future events or developments.
Neither E.ON nor any respective agents of E.ON undertake any obligation to provide the recipient with access to any additional information or to update
this presentation or any information or to correct any inaccuracies in any such information.
Certain numerical data, financial information and market data (including percentages) in this presentation have been rounded according to established
commercial standards. As a result, the aggregate amounts (sum totals or interim totals or differences or if numbers are put in relation) in this presentation
may not correspond in all cases to the amounts contained in the underlying (unrounded) figures appearing in the consolidated financial statements.
Furthermore, in tables and charts, these rounded figures may not add up exactly to the totals contained in the respective tables and charts.

                                                                                                                                                            53
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