Energia
2024 H1 RESULTS Continued progress in operational performance Market prices decreasing Higher nuclear power output in France, expected at upper end of the range Lowest ever carbon intensity Success of commercial offers
2024 HALF-YEAR RESULTS
Continued progress in operational performance
Market prices decreasing
Higher nuclear power output in France, expected at upper end of the range
Lowest ever carbon intensity
Success of commercial offers
Net financial debt stabilised
“Ambitions 2035”: the Group's transformation continues
Key financial results:
The almost €2.6 billion increase in EBITDA to €18.7 billion is explained by a good operational performance, leading to an increase in nuclear and hydropower output in France, despite a rapid market price downturn has already begun. Services and renewables activities in the rest of Europe also contributed to this rise in EBITDA.
In the second half of the year, the declining market prices will result in a significantly lower H2 EBITDA in 2024 than in 2023.
The financial result is an expense of €13 million, a clear €1.5 billion improvement compared to the first half of 2023, driven by:
The financial result excluding non-recurring items, particularly the change in fair value of the dedicated asset portfolio, is -€1.7 billion, up by €1.3 billion.
Net income excluding non-recurring items amounts to €8.4 billion. The €2.1 billion increase primarily reflects the significant growth in EBITDA, less the tax expense.
The Group's net income is €7.0 billion, up by nearly €1.2 billion year on year. Apart from the substantial increase in net income excluding non-recurring items, the principal items after tax contributing to this increase are:
Group cash flow for the first half of 2024 amounts to €1.9 billion vs. -€1.6 billion in H1 2023. This is explained by a cash EBITDA of €17.6 billion, generated by a good operational performance despite falling market prices.
Working capital rose by €0.7 billion, comprising:
This cash flow funded net investments of €11.1 billion, €1.9 billion more than in first-half 2023 due notably to new nuclear projects including Hinkley Point C, network development and reinforcement and nuclear fleet maintenance. The acquisition of the nuclear activities of GE Steam Power (Arabelle Solutions) and Assystem's 5% stake in Framatome also had a €0.9 billion effect on the rise in investments.
Net financial debt stands at €54.2 billion, stable compared to end-2023. The favourable impact of the positive cash flow was almost fully absorbed by the announcement that the hybrid bond issued in October 2018 for a nominal amount of €1.25 billion would be redeemed and its equity content replaced by the capital increase resulting from the conversion of the Oceane bonds in 2023
.
The bond issues during the first half of 2024, totalling around €5.5 billion, the lower level of short-term debt, and early repayments of bank loans lengthened the maturity of the Group's financial debt to 12.1 years at end-June 2024 (vs. 11 years at end-2023), and made it possible to control financing costs in a time of rising interest rates.
Financial results by segment:
Segment sales are presented before elimination of inter-segment operations.
The increase in EBITDA is explained by higher output of nuclear power and hydropower, which had a favourable effect estimated at €1.5 billion and €0.8 billion respectively.
The decline in sale prices had an estimated impact of -€8.1 billion. This effect is largely explained by the change in the average forward market prices in the past 2 years: €178/MWh in 2024 vs. €218/MWh in 2023, and in the ARENH cropping price: €102/MWh in 2024 vs. €410/MWh in 2023.
Falling market prices affecting net purchases in a context of higher nuclear output had a positive effect estimated at €7.8 billion; this effect should be very limited in the second half of the year.
The increase in EBITDA is principally explained by a positive price effect estimated at €1.9 billion, caused by purchases to cover network losses made at lower market prices than in 2023 (€1.3 billion) and changes in the TURPE network access tariff (€0.5 billion).
The 0.6TWh decline in volumes distributed excluding weather effects had a limited impact on EBITDA.
Group Renewables excluding hydropower in France
Contribution by EDF Renewables
The increase in EBITDA for Group Renewables is attributable to a 13.1% increase in wind and solar power output thanks to new installed capacities that brought total net capacity to 15.3GW at 30 June 2024. In Italy and Belgium, hydropower output also rose substantially due to better hydrological conditions.
At EDF Renewables, EBITDA for generation progressed due to 9.7% growth in volume output following the commissioning of new plants, despite less favourable wind and sunshine conditions in France, and a downturn in prices. The rise in EBITDA is also explained by portfolio rotation, notably involving sales of plants in the United States and Brazil.
Group Energy Services
Contribution by Dalkia
The service activities of Dalkia and IZI Confort in France contributed to the increase in EBITDA for Group Energy Services.
At Dalkia, the rise in EBITDA is attributable to the business performance, particularly in energy efficiency services and decarbonisation in France. However, sales of electricity from cogeneration plants were down compared to the first half of 2023.
New nuclear projects in France and the United Kingdom explain the increase in EBITDA.
Order intake amounts to approximately €15.2 billion at 30 June 2024, well above end-2023, largely due to new nuclear projects in France and the United Kingdom, particularly the Sizewell C project.
Together with TechnicAtome, Framatome acquired Vanatome (Daher Valves) which specialises in the design, production and qualification of a wide range of valves for the nuclear and defence sectors.
The decrease in EBITDA is explained in particular by lower margins in the domestic and small business customer segments, as the first half of 2023 benefited from an exceptional recovery of some of the costs incurred during the energy crisis.
Operational performance was strong for the generation business, with a limited -0.1TWh downturn in nuclear power output to 18.1TWh despite unplanned outages at Heysham 1 and Hartlepool. The impact of these outages was largely offset by optimisation of scheduled outages and higher realised nuclear prices.
The increase in EBITDA in the electricity generation business was driven by the growth in renewables activities, especially a rise in hydropower thanks to exceptionally good hydrological conditions.
The gas business has benefited from good optimisation performances on the portfolio of long-term gas contracts.
In the sales activities, customer portfolio growth explains the improvement in EBITDA.
Wind and solar power capacities totalled 669MW net at 30 June 2024.
The lower EBITDA in Belgium is essentially explained by falling prices, despite better nuclear power output (+11%), after a year 2023 affected by the Chooz power plant shutdown, and higher hydropower output (+32%). Also, cost increases for nuclear waste were reinvoiced in 2023, and this had no equivalent in 2024.
Wind power capacities totalled 635MW net at 30 June 2024.
In Brazil , EBITDA was down slightly due to the -4% indexed adjustment to the Power Purchase Agreement attached to EDF's Norte Fluminense plant in November 2023, despite an increase in revenues from system services.
The increase in EBITDA for the gas activities is explained by improved margins on the Group's assets in gas storage activities and sale of gas, despite the lower level of business at the Dunkirk terminal.
EDF Trading 's EBITDA decreased in a context of falling prices and volatility on the wholesale markets.
Extract from the consolidated financial statements
Consolidated income statement
(1) Other external expenses are reported net of capitalised production.
Consolidated balance sheet
Consolidated cash flow statement
(1) Investments in intangible assets and property, plant and equipment comprise €(9,663) million of acquisitions of property, plant and equipment (€(8,578) million in 2023), €(1,151) million of acquisitions of intangible assets (€(868) million in 2023) and €(606) million change in payables to suppliers of fixed assets ((€606) million in 2023
(2) In 2024, these transactions notably include a €1,086 million capital injection by the British government into the Sizewell C project and the purchase of Assystem's minority interests in Framatome for €(205) million. In 2023, they included an amount of €776 million corresponding to capital injections by CGN into NNB Holding (HPC) and by the British government into NNB Holding (SZC) Ltd.
Main press releases since announcement of the 2023 results
Governance
Nuclear
Renewables
Customers
Grids
Human resources
Financing
The EDF Group is a key player in the energy transition, as an integrated energy operator engaged in all aspects of the energy business: power generation, distribution, trading, energy sales and energy services. The Group is a world leader in low-carbon energy, with a low carbon output of 434TWh , a diverse generation mix based mainly on nuclear and renewable energy (including hydropower). It is also investing in new technologies to support the energy transition. EDF's raison d'être is to build a net zero energy future with electricity and innovative solutions and services, to help save the planet and drive well-being and economic development . The Group supplies energy and services to approximately 40.9 million customers and generated consolidated sales of €139.7 billion in 2023.
(1) See EDF's 2024 URD sections 1.2.3, 1.3.2 and 3.1
(2) Customers are counted per delivery site. A customer may have two delivery points.
This presentation is for information purposes only and does not constitute an offer or solicitation to sell or buy instruments, any part of the company or assets described, in the US or any other country. This document contains forward-looking statements or information. While EDF believes that the expectations reflected in these forward-looking statements are based on reasonable assumptions at the time they are made, these assumptions are intrinsically uncertain, with inherent risks and uncertainties that are beyond the control of EDF. As a result, EDF cannot guarantee that these assumptions will materialise. Future events and actual financial and other results may differ materially from the assumptions underlying these forward-looking statements, including, but not limited to, differences in the potential timing and completion of the transactions they describe. Risks and uncertainties (notably linked to the economic, financial, competition, regulatory and climate situation) may include changes in economic and business trends, regulations, and factors described or identified in the publicly-available documents filed by EDF with the French financial markets authority (AMF), including those presented in Section 2.2 “Risks to which the Group is exposed” of the EDF Universal Registration Document (URD) filed with the AMF on 4 April 2024 (under number D.24-0238), which may be consulted on the AMF website at
www.amf-france.org or the EDF website at www.edf.fr .
Neither EDF nor any EDF affiliate is bound by a commitment or obligation to update the forward-looking information contained in this document to reflect any events or circumstances arising after the date of this presentation.
( 1 ) This segment comprises Framatome and Arabelle Solutions, but no Arabelle Solutions items are incorporated in H1 2024 due to their non-material nature for the Group's income statement.
(2) Net financial debt is not defined in the accounting standards and is not directly visible in the Group's consolidated balance sheet. It comprises total loans and financial liabilities, less cash and cash equivalents and liquid assets. Liquid assets are financial assets consisting of funds or securities with initial maturity of over three months that are readily convertible into cash and are managed according to a liquidity-oriented policy.
(3) See the press release of 5 June 2024 announcing a hybrid bond redemption which took place on 5 July 2024: this announcement led to reclassification of the bond from equity to other financial liabilities at 30 June 2024.
( 4 ) Including Enedis, Électricité de Strasbourg and the French island activities.
(5) Indexed adjustment to the TURPE 6 distribution tariff: +6.51% at 1 August 2023.
(6) Group Energy Services comprises Dalkia, IZI Confort, IZI Solutions, Sowee, Izivia, and the service activities of EDF Energy, Edison, Luminus and EDF SA. The services consist in particular of heating networks, decentralised low-carbon generation using local resources, street lighting, energy consumption management and electric mobility.
(7) This segment comprises Framatome and Arabelle Solutions, but no Arabelle Solutions items are incorporated in H1 2024 due to their non-material nature for the Group's net income.
(8) For the Edison scope.
(9) Luminus and EDF Belgium.
(10) For the Luminus scope.
(1) Based on cumulative EBITDA for H2 2023 and H1 2024.
(2) Nuclear generation allocation contracts
(3) France, UK, Italy, Belgium. Excluding B2B customers, and customers of Électricité de Strasbourg and the French island activities.
(4) Estimated nuclear generation by the plants currently in operation (excluding Flamanville 3).
(5) After deduction of pumped-storage consumption, hydropower output totals 27.1TWh in H1 2024 vs. 18.4TWh in H1 2023.
(6) See the press release of 31 May 2024.
(7) Enedis is an independent subsidiary of EDF under the French Energy Code.
(8) Recycled hydrotreated vegetable oil.
(9) Based on scope and exchange rates as at 1 January 2024 and assuming French nuclear output by the plants currently in operation (excluding Flamanville 3) of
315-345TWh in 2024 and 335-365TWh in 2025 and 2026.
(10) Applying constant S&P ratio methodology.
Attachment
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