EDF First-Half Profit Tops Forecasts
French power giant EDF posted forecast-beating interim profits on Friday, driven by a strong performance in France, Germany and Italy, and it reiterated its financial guidance.
Europe's biggest power utility by market value said in a statement net profit excluding exceptional items rose to 3.183 billion euros ($4.33 billion) from 2.918 billion a year ago, despite unfavourable weather conditions and the divestment of Brazilian unit Light.
Operating income rose 1.2% to 6.535 billion euros, while earnings before interest, tax, depreciation and amortisation (EBITDA) reached 8.865 billion euros, against a restated 8.388 billion euros in the first half of 2006.
This beat the 3.11 billion euro average net income forecast of 14 analysts polled by Reuters, and also beat average estimates for operating income of 6.063 billion and EBITDA of 8.527 billion.
EDF had already reported interim sales down 0.2 percent at 30.311 billion euros as mild winter weather capped demand for electricity.
EDF, which is 86% owned by the French state, reiterated a 2006-2008 guidance for core earnings growth of 3 to 6 percent and a double-digit percentage rise in net profit excluding exceptional items.
"The second half of 2007 will be characterised by the continued Altitude cost-cutting program, the targets of which should be exceeded by more than 10% at the end of 2007, and by the effects on the nuclear output of the action plan to correct the non-conformances on (some) steam generators," EDFsaid in a statement.
"Against this background, EDF Group confirms its 2006-2008 financial guidance announced at the time of the IPO."
EDF made no reference to the expected financial impact of a French policy allowing small and medium-sized businesses to return to regulated tariffs for two years. EDF has said it expects the measure to cost it 1.4 billion euros in total.
The group will hold an analyst meeting later on Friday, but has planned no news conference.