Engie posts first-quarter earnings in line with expectations
By Forrest Crellin
Engie’s First-Quarter Financial Performance and Market Outlook
PARIS, May 7 (Reuters) - French utility Engie met expectations as it reported a drop in first-quarter earnings on Thursday after warmer weather lowered domestic gas sales and deliveries.
Key Financial Results
The company, which produces, transports and sells gas and electricity, said earnings before interest and tax (EBIT) excluding nuclear, were 3.4 billion euros ($4 billion), down 8.4% from a year earlier.
That matched the consensus forecast of 3.4 billion euros from analyst estimates compiled by LSEG.
Performance by Business Segment
Energy Management Business
The earnings decline was partially attributable to its energy management business, which supplies power and gas to retail customers and business clients, where operating profit was down 12.2% at 1.14 billion euros, the company said.
Renewable and Flexible Power Generation
The company's renewable and flexible power generation arm also suffered a sharp decline in operating profit, with warmer weather contributing to the 16.1% fall to a little short of 1 billion euros, company data showed.
Operational Developments and Regional Focus
Onshore Wind and Renewable Energy Initiatives
Engie also confirmed a media report this week that said onshore wind project development had slowed in the United States, but it added that solar and battery sector development continues.
"Some permits are being revoked for onshore wind power. It's clear that obtaining the necessary authorisations is indeed difficult," Engie finance chief Pierre-Francois Riolacci told reporters.
"Even when permitting isn't required on federal lands, we still face challenges getting approval from agencies."
Middle East Expansion
Riolacci also said the company is still targeting the Middle East as a high-growth region for renewable energy development.
Industry Perspective and Market Impact
"I would say the crisis further validates the idea that moving away from fossil fuels is generally a good one, particularly for electricity production," he said, adding that there has been no disruption for its gas customers as a result of the conflict.
($1 = 0.8509 euros)
(Reporting by Forrest CrellinAdditional reporting by America Hernandez in Paris and Dimitri Rhodes and Clement Martinot in GdanskEditing by David Goodman)
