EDP Full-Year Profit Drops 10% as Brazil Unit’s Earnings Fall

EDP-Energias de Portugal SA, the country’s biggest utility, said full-year profit fell 10 percent as earnings from its Brazilian unit declined.

Net income fell to 1.01 billion euros ($1.3 billion) from 1.13 billion euros a year earlier, Lisbon-based EDP said today in a regulatory filing. That compares with the 1.03 billion-euro mean analyst estimate in a Bloomberg survey.

Earnings before interest, tax, depreciation and amortization slipped 3.4 percent to 3.63 billion euros. The Brazilian unit’s Ebitda declined 22 percent after the real depreciated against the euro and the start of the Pecem power plant was delayed, EDP said.

“Globally, it was a difficult year,” Chief Executive Officer Antonio Mexia said today at a press conference in Lisbon.

The former 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.

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

Net debt rose to 18.2 billion euros at the end of December, an 8 percent increase from the end of 2011, EDP said today.

EDP shares rose 0.9 percent to close at 2.32 euros in Lisbon before the earnings announcement. The stock has climbed 1.3 percent this year, giving EDP a market value of 8.48 billion euros.

The Portuguese government on Feb. 14 sold 4.1 percent of EDP to institutions at 2.35 euros a share. The government in December 2011 agreed to sell a 21 percent stake in EDP to China Three Gorges Corp. for 2.69 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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