Bloomberg News

EDP Nine-Month Net Falls 3.5% on Lower Earnings From Brazil Unit

November 06, 2012

EDP-Energias de Portugal SA, the country’s biggest utility, said nine-month profit fell 3.5 percent on lower earnings from its Brazilian unit.

Net income dropped to 795 million euros ($1.02 billion) from 824 million euros a year earlier, Lisbon-based EDP (EDP) said today in a regulatory filing. Earnings before interest, tax, depreciation and amortization slipped 1.2 percent to 2.74 billion euros, with the Brazilian unit’s contribution to Ebitda declining 28 percent.

The former Portuguese power monopoly is spending on new dams and wind turbines in Europe and Brazil to rely less on oil and coal and tap state incentives for alternative energy. EDP plans to invest 2.1 billion euros on average a year through 2015.

The company estimates installed capacity will increase 14 percent to 26.4 gigawatts in 2015 from 2011, EDP said on May 23. Hydropower plants and wind farms will represent 73 percent of the utility’s capacity in 2015.

Net debt rose to 18.25 billion euros at the end of September from 16.95 billion euros in December. EDP in September sold Portugal’s first benchmark corporate bonds since January 2011, raising 750 million euros from issuing five-year bonds.

The Portuguese government in December agreed to sell a 21 percent stake in EDP to China Three Gorges for 2.69 billion euros. The Chinese company will also spend 2 billion euros to purchase minority stakes in EDP wind farms by 2015 and offer additional funding for EDP. The government on Oct. 31 approved a plan to sell a 4.14 percent stake in EDP.

EDP shares slipped 0.6 percent to close at 2.03 euros in Lisbon before the earnings were released. The stock has dropped 15 percent this year, giving EDP a market value of 7.42 billion euros.

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

To contact the editor responsible for this story: Stephen Foxwell at sfoxwell@bloomberg.net


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