Profits drop 11% at EDP, rise 85% at EDP Renewables in first semester

EDP – Energias de Portugal, whose biggest shareholder is China Three Gorges, posted a net profit of EUR 306 million in the first half of 2022, a decrease of 11% compared to the same period last year.

In a statement, the company says the results “were marked by the positive performance of renewables and networks in Brazil”, but “strongly penalized by the extreme drought in Portugal in a context of high electricity prices in the wholesale market, resulting in a -EUR 111m loss in Portugal in 1H22”.

Recurring EBITDA increased 19% to EUR 1,944 million in the first six months, a rise of 13%, when excluding the exchange rate variations, with a “strong contribution” from EDP Renováveis and Redes in Brazil.

EDP profit drops as EDP Renewables´ rises

EDP net financial costs rose EUR 130 million to EUR 385 million, with the average cost of debt increasing to 4.5%, reflecting the 140 basis points (bps) increase in the cost of debt, mainly from Brazil. The average cost of debt excluding debt denominated in Brazilian Real (15% of consolidated debt) increased by only 30 bps to 2.7%.

In the first six months of the year, net debt totalled EUR 14.2 billion, “mainly impacted by the acceleration of investment,” but also by the appreciation of the Brazilian Real and the US Dollar.

Investment increased 23% to 1.7 billion, of which 97% in renewable energy and electricity networks. In renewable energies, in the last 12 months, EDP installed 2.5 gigawatts of capacity, and 75% of electricity production was originated from renewable energies, “despite the increase in thermal generation that mitigated the lower hydro output,” said the company.

EDP Renováveis (EDPR) announced an increase in profits by 87% to USD 265 million in the first half of the year, a result that compares with gains of 142 million recorded a year ago and is explained by higher energy prices.

“The solid 1H22 results, mainly driven by increase of avg. selling prices and generation increase, resulting in strong EBITDA and net profit,” the company writes in its financial statement. Revenues totalled EUR 1,237 million, resulting in a 45% increase compared to the first six months of 2021 (EUR 381 million). The average selling price increased 27% year-on-year (YoY), “mainly driven by higher market prices in Europe and impact from Spanish regulatory framework update,” according to EDPR.

EBITDA (earnings before interest, taxes, depreciation and amortisation) increased 49% YoY to EUR 976 million. EBIT (earnings before interest and taxes) rose 76% to EUR 640 million “supported by top line solid performance.”

 

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