Germany’s biggest utility group, EON AG, announced on Wednesday a 50 percent profit drop due to reduced power generation earnings following the closure of its nuclear reactor, and a weakened demand in its gas business.

Eon said after the announcement that it will now cut its dividend by a third to €1 a share for 2011 but pointed out the payout will increase to €1.10 for 2012.

The group recorded a net loss of €2.219bn in 2011 against a net profit of €5.85bn a year earlier. Net income dropped to almost €2.5bn, still beating a €2.33bn estimate by Bloomberg analysts. EON’s EBITDA fell by 30 percent to €9.293bn but sales grew 22 percent to €113bn.

The utilities group has been revamping operations since Chancellor Angela Merkel directed the closure of all nuclear plants in Germany by 2022. Following that EON announced job cuts, a €15bn divestment programme and an extensive expansion scheme into new markets including Brazil.