July 31, 2018 / 6:45 AM / 16 days ago

EDF first-half core earnings up 18 percent on strong hydro output

PARIS (Reuters) - First-half core earnings at France’s EDF (EDF.PA) jumped nearly 18 percent to 8.23 billion euros ($9.6 billion) on strong hydropower output and a rebound in nuclear energy production , and EDF also slightly increased its 2018 earnings guidance.

The state-controlled utility said the earnings improvement was driven mainly by a sharp increase in its French nuclear and hydropower generation business.

EDF increased its earnings guidance for 2018 core earnings slightly to 14.8-15.3 billion euros from 14.6-15.3 billion and confirmed it is on track for cash flow that is slightly positive or close to balance, excluding investments in its Linky smart meters and asset disposals.

Hydropower output in France jumped nearly 40 percent or 8 terawatt to 29.3 terawatt hour (TWh), accounting for the highest half-yearly hydro output in the last fifteen years, EDF said.

French nuclear production rose 2.7 percent or 5.4 TWh to 202.6 Twh due to higher availability of EDF’s nuclear fleet compared to the first half of 2017, which saw several reactor outages linked to manufacturing problems at the Creusot nuclear foundry.

The higher French hydro and nuclear production alone boosted core earnings by 544 million euros, while better wholesale market conditions also contributed an extra 469 million euros.

Sales rose 5.6 percent to 35.18 billion euros, while EBIT fell 6 percent to 3.65 billion euros.

EDF’s recurring net income rose 27 percent to 1.74 billion euros while net income fell 13.9 percent to 1.73 billion euros.

A ThomsonReuters poll of four analysts had forecast core earnings before interest, tax, depreciation and amortization (EBITDA) of 7.82 billion euros, EBIT of 3.45 billion euros and current net income of 1.26 billion euros.

EDF also said its net financial debt to EBITDA ratio had improved to 2.1 times from 2.4 times at the end of last year.

Reporting by Geert De Clercq; Editing by Sudip Kar-Gupta

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