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Oil report

UPDATE 2-E.ON banks on networks to weather coronavirus crisis

* Innogy assets expected to lift earnings

* Adj EBIT seen at 3.9-4.1 bln euros in 2020

* Financially vulnerable clients will remain connected -CEO

* Shares lead DAX gainers (Recasts with CEO, detail)

FRANKFURT/DUESSELDORF, Germany, March 25 (Reuters) - E.ON forecast a jump in profit this year sending its shares up more than 11% as Europe’s largest energy network operator looks to ride out the coronavirus crisis supported by revenue from its regulated grids.

“E.ON can and will deal with this downturn better than most other energy companies,” CEO Johannes Teyssen told journalists at the group’s annual news conference on Wednesday, pointing to its changed strategy following the break-up of rival Innogy .

It expects adjusted earnings before interest and tax (EBIT) to rise by as much as 28% this year -- to 3.9-4.1 billion euros ($4.22-4.44 billion) from 3.2 billion -- buoyed by grids and retail operations it acquired from Innogy.

Between 2020 and 2022 EBIT is expected to grow 7-9% per year, the company said. It forecast adjusted net income for this year at 1.7-1.9 billion euros, up from 1.5 billion.

The company, which supplies about 50 million customers in Europe, said dividends are expected to grow by 5% annually up to 2022. It is paying 0.46 euros per share for 2019.

Teyssen said the pandemic was having an impact on energy demand across the continent and would have a temporary impact on the group’s network and sales business, adding there could be delays in its ability to deliver energy infrastructure projects. He did not quantify the expected impact.

But he reiterated that about 80% of the group’s operating profit was regulated.

Financially vulnerable clients will not be disconnected from supply for the time being, Teyssen said. Across the group confirmed coronavirus cases currently stand at 37, he said.

“A reassuring and supporting strong investment case,” said a local trader while analysts at Bernstein and Jefferies called the outlook encouraging.

Shares in E.ON, which said it would invest about 13 billion euros over the next three years, were up 11% at the top of Germany’s blue-chip index.

$1 = 0.9243 euros Additional reporting by Vera Eckert; editing by Scot W. Stevenson and Jason Neely

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