EDP Raises Profit Outlook Citing Networks Strength and Asset Rotation Gains
EDP Upgrades Full-Year Profit Guidance and Highlights Key Growth Drivers
Stronger Performance in Networks Business
LISBON, July 30 (Reuters) - Portugal's largest utility EDP on Thursday upgraded its full-year recurring net profit guidance to €1.4 billion ($1.6 billion) from a previous forecast of between €1.2 billion and €1.3 billion made in November, citing stronger performance in its networks business, improved hydro conditions in Iberia and robust gains from asset rotation.
Improved Financial Outlook
• EDP said the higher recurring net profit outlook was supported by an expectation that 2026 recurring earnings before interest, taxes, depreciation and amortization will reach €5.3 billion, above the €4.9 billion-€5 billion range previously forecast.
Investment Plans and Efficiency Gains
• EDP cited in a statement the good execution of investment plans in its distribution networks business, better regulated returns and efficiency gains, and a favourable euro-to-Brazilian real exchange rate.
Hydro Conditions and Power Prices in Iberia
Hydro Reservoir Levels
• It also pointed to Iberian hydro reservoir levels remaining above historical averages in July 2026, as well as stronger forward power prices for the second half of the year supporting the outlook.
Asset Rotation and Renewables Business
Long-Term Contracts and Hedging
• EDP also said its subsidiary EDP Renewables, the world's fourth-largest wind power producer, has more than 85% of its generation volumes secured through long-term contracts or hedging arrangements.
Asset Rotation Gains
• It said EDPR is expected to generate €300 million in asset rotation gains, at the top end of its previously forecast €200 million-€300 million range, from the sale of stakes in mature renewable energy projects to fund new developments.
First Half Results and Analyst Expectations
Recurring Net Profit
• EDP on Wednesday reported a recurring net profit of €753 million ($857.5 million) for the first half, flat from a year earlier, as strong earnings from its renewables and networks unit were offset by lower electricity prices in Iberia.
Analyst Forecasts
• The result beat the average analyst forecast of €686 million in an LSEG poll.
Exchange Rate Information
($1 = 0.8735 euros)
(Reporting by Sergio Goncalves; Editing by David Holmes)
