UPDATE 1-RWE targets higher 2020 profit after lifting earnings by 40% in 2019

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FRANKFURT, March 12 (Reuters) - Germany's biggest electricity producer RWE said it was targeting further profit growth in 2020 after lifting earnings by 40% in the previous year, with profit tripling at its usually volatile supply and trading unit.

"We have an outstanding basis from which to resolutely expand our business and achieve value-added growth," said chief executive Rolf Martin Schmitz in a statement.

The company reported adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of 2.1 billion euros ($2.37 billion) in 2019, a 40% increase, while adjusted net income doubled to 1.2 billion euros.

A group of analysts polled by Reuters had seen adjusted EBITDA at 2.16 billion euros and adjusted net income at 1.03 billion.

The company intends to achieve adjusted EBITDA of between 2.7 billion and 3 billion euros for 2020 and adjusted net income of 850 million and 1.15 billion euros, it said.

The Supply & Trading unit's adjusted EBITDA alone nearly trebled to 702 million.

This unit trades natural and liquefied natural gas (LNG) among a range of commodity trading house activities involving energy products and supply of industrial customers, as well as operating gas storage facilities.

All these businesses depend on fluctuating energy wholesale markets, so performance can be highly variable.

RWE forecast the unit's performance this year might be more in what it called a normal range of 250 million euros.

It raised its proposal for a 2019 dividend to 80 cents from 70 cents a year earlier and is targeting 85 cents for 2020.

RWE, now Europe's third-biggest renewable player with a wind and solar power portfolio of 9 gigawatts (GW), will invest a net 5 billion euros in the continued expansion of renewable energy.

It said the sum had the potential to increase significantly through partnerships.

Of the total, 20% is earmarked for Germany, where RWE has to exit its legacy coal business in a long-term process ruled by agreements with the Berlin government.

($1 = 0.8853 euros) (Reporting by Vera Eckert; Editing by Thomas Seythal and Jan Harvey)