Engie SA’s shares rose on Tuesday as full-year results benefited from higher energy prices and strong commercial activities despite the negative impact of warm temperatures in Europe.
At 0901 GMT, shares trade 4.1% higher at EUR14.15.
The French utility company reported a roughly 43% organic increase in earnings before interest and taxes, with growth driven by the global energy management and sales business, its thermal activities and new capacity additions in renewables.
Revenue came in at EUR93.87 billion, up 60% on year on a like-for-like basis.
“Just like Southern European utilities with a presence in Latin America and the United States, Engie benefited from the appreciation of the U.S. dollar and the Brazilian real,” ING’s Nadege Tillier said in a research note. “On the other hand, warmer temperatures had a negative impact on the group’s results.”
Management proposed a dividend of EUR1.40 for the year, which corresponds to a payout ratio of 65% and is higher than consensus expectations of EUR1.25 a share, according to Citi.
“What is really important and positive is that Engie delivered on its dividend objective with EUR1.40 a share dividend proposal and that short- and medium-term guidance should alleviate market concerns about possible negative earnings revisions,” analysts at the bank said in a research note. “We also think Engie’s mid-term growth strategy is not yet fully reflected in market expectations.”
For the current year, Engie targets EBIT excluding nuclear of EUR6.6 billion to EUR7.6 billion, and net recurring income of between EUR3.4 billion and 4 billion.