French state-controlled power group Electricite de France SA (EDF.FR)
Tuesday raised its performance target for the year and reiterated its
full-year financial guidance as it posted a 3.8% increase in recurring
net profit to EUR3.07 billion from EUR2.96 billion a year earlier,
thanks to favorable weather conditions mostly.
MAIN FACTS:
- First-half net profit increased 3.5% to EUR2.88 billion from EUR2.78 billion a year earlier.
- Earnings before interest, tax, depreciation
and amortization, or Ebitda, in the first half increased to EUR9.7
billion from EUR9.07 billion a year earlier while Earnings before tax
and interest, or EBIT, rose to EUR5.79 billion from EUR5.6 billion a
year earlier.
- The performance was mostly due to the
colder-than-usual weather in Northern Europe over the first half as well
as favorable market prices and a sharp increase in hydro power output.
- The group also cited a good performance in
Italy as well as the favorable outcome of arbitration of gas contracts
i, Algeria in April and the new renegotiation of the Qatari contract in
July.
- "This performance is reflected in the
increase in financial results, which have also been boosted by
successful renegotiations of Edison's long-term gas contracts in Italy,"
the group's chairman and chief executive Henri Proglio said in a
statement.
- The group now sees its full-year Ebitda
organic growth of at least 3%, excluding Edison, while it sees Edison's
Ebitda for the year close to EUR1 billion now.
- EDF
reiterated its objective to save as much as EUR1 billion in costs this
year as over the first half, savings amounted to EUR360 million from the
Sparks program.
- For 2013, EDF
reiterated its target of nuclear output of 410 to 415 terawatts/hour,
or TWh, after output in France in the first half was down 0.5 TWh or
0.2% from a year earlier.
- Hydropower output was up 25.4% or 5.1 TWh due to a positive weather effect.
- Net investments over the period came out to EUR6.24 billion, down 1.5% from a year earlier and for 2013, EDF
is targeting net investments of between EUR12 billion and EUR12.5
billion, "depending on when certain disposals are carried out," it said.
-
- Separately, EDF
signed a deal with U.S.-based nuclear group Exelon which would
eventually allow the group to exit their joint-venture CENG, which
currently operates fuve reactors in the U.S.
- The deal grants EDF a put-option with Exelon committing to buy EDF's stake in CENG between January 2016 and June 2022 at a price still to be determined. "This stake is clearly not strategic for EDF. The group doesn't ambition to hold minority stakes in energy companies," EDF's chief financial officer Thomas Piquemal is quoted as saying in an interview with French business daily Les Echos Tuesday.
- The deal also grants EDF an exceptional dividend of around $400 million as EDF will allow Exelon to manage the five reactors handled by CENG as part of its fleet. The deal should be accretive from 2015 on.