May 7 (Bloomberg) -- CEZ AS, the Czech Republic’s largest electricity company, climbed to the highest level in three weeks after reporting first-quarter earnings that beat analyst estimates and raising full-year profit targets.
The stock gained as much as 2.3 percent to 582 koruna, the highest price since April 16, and was up 0.9 percent at 574 koruna as of 12:05 p.m. in Prague. The 14-member PX Index advanced 0.4 percent.
Net income in the three months through March rose 24 percent to 17.9 billion koruna, the company said today, more than the 14.7 billion-koruna average estimate of nine analysts in a Bloomberg survey. CEZ posted a gain of 1.5 billion koruna from trading carbon permits, while earnings were also buoyed by 1.9 billion koruna after the company stopped operations in Albania, where the utility lost its license last year.
“The results were significantly better than our estimate and the market consensus,” Josef Nemy, an analyst at Komercni Banka AS, said in a note published after the earnings were released.
The utility raised its earnings guidance after concluding a 50-year contract for supplies of brown coal. The target for 2013 net income was increased to 37.5 billion koruna from 37 billion koruna, while the goal for earnings before interest, taxes, depreciation and amortization was lifted to 81 billion koruna from 80 billion koruna.
The increased targets do not include proceeds from the March disposal of the Chvaletice coal-fired plant, which may add a further 2 billion koruna to net income this year, Chief Financial Officer Martin Novak said at a press conference in Prague today. The transaction must first be approved by the anti-monopoly office, he said.
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