PARIS (Reuters) – Engie published increased 2023 results on Thursday, driven by its activities in energy management and renewables, and raised its forecast for 2024 despite the drop in market prices.
The energy company now expects a recurring net profit, group share, of between 4.2 and 4.8 billion euros this year, compared to 3.8 to 4.4 billion previously. This indicator is, however, expected to decline compared to the level of 5.4 billion euros (+2.8%) recorded in 2023, with Engie assuming a “normalization of prices and volatility”.
“It is lower than 2023 since the market conditions are different, but much higher than 2021 which is the best year of comparison in terms of market conditions”, underlined Catherine MacGregor, the general director of Engie, during a telephone press conference.
Engie has also slightly revised downwards its forecast for recurring net profit share of the group for 2025, now expected between 3.9 and 4.5 billion, compared to 4.1 to 4.7 billion previously.
It also expects an average annual growth rate of its operating income (Ebit) excluding nuclear power of between 10% and 12% over the period 2021-2026.
“The price assumptions underlying our projections (…) are very different. We have very significant differences which naturally reflect the drop in market prices (…) over the last 12 months,” declared the director financier, Pierre-François Riolacci.
Around 12:25 p.m., Engie shares gained 2.68% to 14.92 euros while the CAC 40 advanced 0.98%.
Javier Garrido, analyst at JP Morgan, spoke in a note of results “largely in line with expectations”, saying that the key question for the group was that of the evolution of its forecasts depending on prices.
INCREASING DIVIDEND
While Engie’s 2024-2026 forecasts are based on futures prices in Europe at the end of 2023, which have since accentuated their decline, the financial director argued during a conference that the group had the possibility of lowering its costs and certain investment expenses, but also to sell assets, if these prices were to remain permanently low.
Engie recorded for last year a net profit group share of 2.2 billion euros (compared to 0.2 billion in 2022), a profit before interest and taxes (Ebit) excluding nuclear of 9.5 billion (+18.2%) and a turnover of 82.6 billion (-12.0%).
It proposes a dividend of 1.43 euros per share, up 2.1%.
The group particularly benefited in 2023 from the performance of its “Global Energy Management & Sales” (GEMS) division, which includes supply, risk management and asset optimization activities in energy, including operating profit. jumped 36% to 3.6 billion euros. Projections for 2026 include an annual “normalized EBIT” for this activity revised upwards (from 1 to 1.5 billion).
The operating profit of its renewable energies division increased by 23% last year, thanks in particular to commissioning and positive price effects.
(Reporting by Benjamin Mallet; editing by Kate Entringer and Sophie Louet)
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