High power prices boost Engie earnings in first quarter
French energy company Engie on Thursday reported a rise in first-quarter earnings, buoyed by high European power prices, and expected its full-year performance would likely come in at the top end of its forecast range.
The company said its earnings before interest and tax (EBIT) excluding nuclear was €3,8bn – up 30 per cent from the previous year.
“Engie has started 2023 pretty well overall, most of our activities grew over the first quarter,” said executive vice president of finance Pierre-François Riolacci.
Income from renewables rose more than 30 per cent thanks to high power prices and higher hydroelectric generation in France and Portugal and new capacity coming online, while retail natural gas sales lost money due to the company holding too much supply as European market prices fell and client consumption dropped over a mild winter.
Engie’s trading division was able to profit and make up for that retail loss, though the company added that European gas market volatility had begun to stabilize, which would lead to more modest trading returns going forward.
French strikes earlier this year cost Engie some €60m as thermal plants were unable to fully perform and infrastructure was underused, Riolacci said.
The company said it expected to sign an agreement with the Belgian government by June 30 to manage two nuclear plants in a joint venture, with the last cost details left to be negotiated.
This year marks the start of Engie’s financial reporting excluding nuclear, underlining its strategy of exiting the business and focusing on core assets: natural gas supply and infrastructure, with profits fuelling growth in renewables.
Reuters – America Hernandez