EON SE, Germany’s biggest utility, said profit will be in the lower end of its forecast range for 2013 as it reported a 52 percent decline in profit in the first nine months of the year.
Underlying net income, the measure EON uses to calculate its dividend, fell to 1.91 billion euros ($2.57 billion) from 4.02 billion euros a year earlier, the Dusseldorf-based company said today in a statement. That missed the 1.94 billion-euro average estimate of five analysts surveyed by Bloomberg. Sales dropped 4.6 percent to 89.3 billion euros.
European utilities are contending with slower economic growth and stagnant demand, as well as Germany’s planned exit from nuclear power by 2022. The company, expanding abroad to counter a weaker home market, plans to reduce capital spending and is selling assets to cut costs.
EON, which last year scrapped profit forecasts for 2013, today narrowed its target for underlying net income to 2.2 billion euros to 2.4 billion euros from 2.2 billion euros to 2.6 billion euros previously.
“These numbers reflect the fact that the ramifications of the transformation of Germany’s energy system, in particular the insufficient market price for conventional energy, are having a tangible adverse impact on our business,” EON Chief Executive Officer Johannes Teyssen said in a letter to shareholders.
In the third-quarter, EON reported an underlying net loss of 4 million euros compared to an underlying net income of 719 million euros a year earlier. Sales retreated 13 percent to 24.7 billion euros. Both numbers were calculated by subtracting half-year earnings from nine-month results published today.
To contact the reporter on this story: Tino Andresen in Dusseldorf at email@example.com