Bloomberg News

EDP Says Nine-Month Profit Rises 6% on Wind, Brazil Units

October 27, 2011

(Updates with investment plans in fourth paragraph.)

Oct. 27 (Bloomberg) -- EDP-Energias de Portugal SA, the country’s biggest utility, said nine-month profit climbed 6 percent on higher output from wind energy projects and earnings from its Brazilian unit.

Net income rose to 824 million euros ($1.17 billion) from 774 million euros a year earlier, Lisbon-based EDP said today in a regulatory filing.

The former Portuguese power monopoly is spending on new dams and wind turbines in Europe, Brazil and the U.S. to rely less on oil and coal while tapping government incentives for alternative energy. The utility in November cut its average annual investment target for 2011 and 2012 to 2.1 billion euros from an earlier forecast of 2.4 billion euros.

EDP plans to invest about 2.2 billion euros in 2011 and 2 billion euros in 2012, and in March said it forecasts “low single-digit growth” in earnings before interest, tax, depreciation and amortization and in profit for 2011. EDP aims to raise 500 million euros in asset sales this year.

The Portuguese utility on July 13 said it raised 362 million euros from the sale of shares in its Brazilian unit, trimming its holding in EDP-Energias do Brasil SA to 51 percent from 64.8 percent.

Ebitda rose 5 percent to 2.8 billion euros in the first nine months of the year. Net debt was 16.6 billion euros at the end of September, down from 16.9 billion euros in June, the company said.

Shares Rise

At the end of this year, EDP’s debt will be similar or lower in comparison to what it was last year, Chief Financial Officer Nuno Alves said today at a press conference.

EDP shares rose 1.1 percent to 2.405 euros in Lisbon before the earnings announcement. The stock has slipped 3.5 percent this year, giving the company a market value of 8.79 billion euros.

Portugal in April became the third euro-area country after Greece and Ireland to request a bailout from the European Union and the International Monetary Fund. As part of that aid package, the government will sell its stakes in companies including EDP and power grid operator REN-Redes Energeticas Nacionais SA by year-end.

Portuguese state holding company Parpublica on Oct. 21 said it received six expressions of interest in the EDP stake, without identifying the companies. Centrais Eletricas Brasileiras SA, Latin America’s largest publicly traded power company, and Cia. Energetica de Minas Gerais, the Brazilian electricity company known as Cemig, have said they bid for the 21 percent stake in EDP.

--Editor: Alex Devine

To contact the reporter on this story: Joao Lima in Lisbon at jlima1@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net


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