RWE says Innogy deal on track after H1 core profit in line

FRANKFURT (Reuters) - RWE on Tuesday said a deal to break up its networks and renewables unit Innogy with rival E.ON was on track after posting first-half core profit that was in line with expectations.

RWE and E.ON in March announced the landmark deal, which will see them divide Innogy's assets between them and turn RWE into Europe's third-largest renewable energy provider behind Spain's Iberdrola and Italy's Enel.

Overall, assets worth nearly 40 billion euros ($45.6 billion) will change hands as part of the deal, which is expected to close next year, RWE said.

"The transaction with E.ON is making good progress. As one of Europe's leading electricity producers, we will have an even broader and stronger portfolio of assets," RWE Chief Executive Rolf Martin Schmitz said in a statement.

First-half adjusted earnings before interest, tax, depreciation and amortisation (EBITDA), excluding Innogy's profit contribution, came in at 1.1 billion euros, down from 1.4 billion in the year earlier period but meeting the average estimate in a Reuters poll.

At 870 million and 683 million euros, respectively, first-half adjusted earnings before interest and tax (EBIT) and adjusted net income came in higher than expected by analysts, who had forecast 825 million and 625 million.

($1 = 0.8773 euros)

(Reporting by Christoph Steitz; Editing by Maria Sheahan)