U.S. News

Suez First-Half Sales Rise 6.2%


Utility Suez said Tuesday that first-half sales rose 6.2%, boosted by recent acquisitions and higher gas prices.

First-half revenue rose to 23.73 billion euros ($32.41 billion) from 22.35 billion euros a year ago, the Belgian-French company said in a statement.

Higher gas prices added 96 million euros ($131.1 million), the utility said, helping to offset the 192 million euros ($262 million) impact of currency fluctuations that Suez said are mainly due to the weak U.S. dollar.

Recent acquisitions including electricity and gas distribution companies Rendo and Cogas in the Netherlands and Spanish energy services company Crespo y Blasco contributed 1.41 billion euros ($1.93 billion). The net gain to sales from changes to the company's structure is 673 million euros ($919.3 million) once revenue from companies sold by Suez is subtracted.

Suez confirmed its financial objectives for 2007 but did not mention its delayed planned merger with state-owned Gaz de France.

In February 2006, former prime minister Dominique de Villepin arranged a merger between the two companies, but the linkup has been hampered by legal and political delays. Villepin's successor, Francois Fillon, has said the new government is weighing other options for Gaz de France. Suez shareholders, who must approve any deal, are seeking to sweeten its terms.

Suez has said it targets a growth in earnings before interest, taxes, depreciation and amortization above 10% and a growth in recurring operating profit above 15% for 2007.

Suez Environment saw the biggest rise in revenue in the first half, adding 11.7%, helped by new wastewater and services contracts in France.

Suez shares have fallen 4% so far this year, lowered by the drop in gas demand, and have underperformed the CAC-40 index. They gained 1.5% to 38.70 euros ($52.86) on Tuesday.