French Engie benefits from cold Q1

French Engie reported May 18 growth in many sectors in Q1 2021 relative to the previous year and it reaffirmed guidance on the basis of the strong start. 

CEO Catherine MacGregor said "solid operational performance" had been key while the company was progressing on group simplification. Its priorities for the year include completing the strategic reviews and creating value from "allocating capital to activities that will accelerate the transition to carbon-neutrality."

Pre-tax earnings (EBITDA) were €3.2bn, up 5% on a gross basis and up 7% on an organic basis; EBIT was €2.1bn, up 8% on a gross basis and up 10% on an organic basis.

Its renewables sector reported a 7% drop in earnings owing to the storm in Texas: iced-up turbine blades led to an €80 ($98)mn loss. Otherwise that division too performed as expected. The company lost the same again on foreign currency exchange in Brazil. 

Networks reported a 16% organic EBIT increase, carrying 11 TWh more than in Q1 2020 owing to the cold weather and recovery from COVID-19 in France. Networks further benefited from power transmission lines under construction in Brazil. "Customer solutions" income also rose at home and in the US, seeing 9% organic EBIT increase with more sales from district heating. But these positive effects were partly offset by lower projects volumes and margins in the UK.

Power generation earnings rose 10% on higher spreads in Europe and positive timing effect on French capacity remuneration recognition but were partly offset by a significant drop in energy margins in Chile.

Supply earnings rose 11% on an organic basis, primarily in France, Belgium and the Netherlands, and recovery from 2020 Covid-19 impacts.