Germany’s EON says 2017 outlook on track as profits surge

FRANKFURT (AFP) – Germany energy giant EON on Wednesday reaffirmed its outlook for 2017 after reporting a strong third quarter in part thanks to higher energy prices in some countries.

The Essen-based group, which booked a record loss last year as it grappled with a major restructuring, saw underlying or operating profits of 350 million euros ($406 million) between July and September, up 13 per cent on last year.

Revenues were up five per cent to 8.4 billion euros, boosted by a pick-up in sales in Sweden and east-central Europe and higher prices for renewables in Italy and the United States.

Looking at the year so far, EON’s preferred yardstick, the group said adjusted net profit soared by 51 per cent to 965 million euros.

“At the nine-month mark, your EON is right on track,” the group said in a statement.

It added that sales for the first nine months were down one percent to 27.9 billion euros, “primarily because of higher costs charged by upstream grid operators in Germany that we passed through to our customers”.

For the whole of 2017, EON said it continued to expect adjusted operating profit of 2.8 to 3.1 billion euros and adjusted net profit of between 1.2 and 1.45 billion.

Like other European generators, EON has long suffered from low wholesale electricity prices and competition from subsidised renewables.