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Edf: SALES OF €21.9BN, UP 6.2% org. ; 2021 GUIDANCE AND 2022 AMBITIONS CONFIRMED
PRESS RELEASE |
FINANCIAL INFORMATION AT 31 MARCH 2021
SALES OF €21.9BN, UP 6.2% org. (1)
2021 GUIDANCE AND 2022 AMBITIONS CONFIRMED
Highlights
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2021 guidance and 2022 ambitions confirmed (6)
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| Operating expenses (8) reduction between 2019 and 2022 €500m |
Dividend Target payout ratio of net income excluding non-recurring items (10) for 2021 & 2022 45%-50%
The French State committed to opt for a scrip dividend payment for 2021 fiscal year
Change in EDF group sales
(in millions of euros) | Q1 2020 restated (1) | Q1 2021 | Organic change (%) (2) |
France – Generation and supply activities | 8,440 | 8,834 | +3.9 |
France – Regulated activities | 5,115 | 5,598 | +9.4 |
EDF Renewables | 396 | 437 | +14.4 |
Dalkia | 1,244 | 1,350 | +7.9 |
Framatome | 794 | 728 | -6.2 |
United Kingdom | 2,748 | 2,689 | -0.9 |
Italy | 1,715 | 2,029 | +18.5 |
Other international | 727 | 693 | -0.3 |
Other activities | 664 | 891 | +35.1 |
Inter-segment eliminations | (1,142) | (1,300) | - |
Total Group | 20,701 | 21,949 | +6.2 |
Group sales in first-quarter 2021 increased relative to first quarter 2020. Sales were bolstered by the positive tariff indexations in France and better electricity and gas prices conditions. However, the favourable trend in gas prices had a limited impact in EBITDA. Sales benefited from favourable weather conditions and a good performance of EDF Trading.
Change in Group sales by segment
France – Generation and supply activities
| Q1 2020 | Q1 2021 | Organic change (%) |
Sales (3) | 8,440 | 8,834 | +3.9 |
Sales in France - Generation and supply activities amounted to €8,834 million in the first quarter of 2021, up by 3.9% in organic terms compared to the first quarter of 2020.
Sales increased due to favourable energy price effects for an estimated €116 million (4), mainly due to the increases in the regulated sales tariff (including the price catch-up of 2019) of 3% (excl. tax) on 1st February 2020 and 1.93% (excl. tax) on 1st February 2021.
Downstream market conditions had a positive impact on sales for an estimated €150 million. Despite the negative impact of the erosion in electricity sales to end customers, sales benefited from the higher capacity remuneration in the offers to end customers linked to the rise in observed prices at the 2020 capacity auctions.
The resale of purchase obligations increased by around €132 million resulting from the positive effect of spot prices. However, the impact on EBITDA was neutral.
Nuclear output came out at 99.2TWh, down by 2.0TWh compared to the first quarter of 2020, owing mainly to the shutdown of the two reactors at Fessenheim (-3.0TWh).
Hydro output (5) totalled 13.7TWh, up by 1.7% (+0.2TWh) compared to the first quarter of 2020.
The decrease in nuclear output, partially offset by a slight increase in hydro output, represented a negative volume effect with an unfavourable €113 million (2) impact on sales compared to first quarter 2020.
France – Regulated activities (6)
| Q1 2020 | Q1 2021 | Organic change (%) |
Sales (7) | 5,115 | 5,598 | +9.4 |
Sales from France - Regulated activities amounted to €5,598 million in the first quarter of 2021, up by 9.4% in organic terms compared to first quarter 2020.
The positive price effect of €158 million is mainly explained by the favourable indexation of TURPE 5 (8) on 1st August 2020.
Sales benefited from a more favourable weather compared to the particularly mild first quarter of 2020 (around €189 million) and from the increase in grid connection services (around €56 million).
Renewable Energies
EDF Renewables
(in millions of euros) | Q1 2020 | Q1 2021 | Organic change (%) |
Sales (9) | 396 | 437 | +14.4 |
EDF Renewables sales came out at €437 million in first quarter 2021, reflecting a 14.4% organic increase versus first quarter 2020.
This positive trend was fuelled in particular by the distributed solar sector in the United States, with a limited impact at the EBITDA level.
Generation sales fell slightly, by 1.3%, as a result of less favourable wind conditions in Europe in 2021. Commissionings in late-2020 and early-2021 only partially offset these unfavourable effects.
Generated volumes totalled 4.2TWh at end-March 2021 (down by 2.9% in organic terms compared to first quarter 2020).
The net installed capacity of EDF Renewables increased relatively to end-December 2020 thanks to commissionings in 2021, totalling 9.2GW (+0.5GW).
The extreme cold spell in Texas did not have a significant impact on sales. However, EDF Renewables was obliged to purchase energy at very high prices in order to honor its contractual commitments.
Group Renewables (10)
(in millions of euros) | Q1 2020 | Q1 2021 | Change (%) | Organic change (%) |
Sales (1) | 1,206 | 1,721 | +42.7 | +44.5 |
Sales for Renewables at Group level amounted to €1,721 million in the first quarter of 2021, up by 44.5% in organic terms. The trend mainly reflected the impact of the sharp increase in electricity spot prices (used by convention to value hydro output (11)) and a slight increase in generation (+0.5TWh). Given the hedging policy, the valuation of additional hydro output had a limited positive impact on Group sales and EBITDA.
The gross portfolio of wind and solar projects under construction reached a new high and stood at 8.1GW gross (2.1GW onshore wind, 2.1GW offshore wind and 3.9GW solar) at the end of the first quarter of 2021.
Energy Services
Dalkia
(in millions of euros) | Q1 2020 | Q1 2021 | Organic change (%) |
Sales (12) | 1,244 | 1,350 | +7.9 |
Sales in the Dalkia segment amounted to €1,350 million in the first quarter of 2021, up by 7.9% in organic terms compared to the first quarter of 2020.
The increase in sales mainly resulted from the substantial rise in gas prices compared to first quarter of 2020.
Sales were also bolstered by favourable weather conditions, owing to near normal conditions in 2021 compared to a mild first quarter of 2020.
Those effects had a limited impact on EBITDA.
Dalkia has been awarded a contract for the creation of a renewable heating network in Issoire city (40 buildings), using waste and biomass heat.
In the healthcare sector, Dalkia signed an eight-year maintenance operating contract with the W. MOREY Hospital in Châlons-sur-Saône city.
Group Energy Services (13)
(in millions of euros) | Q1 2020 | Q1 2021 | Change (%) | Organic change (%) |
Sales (1) | 1,564 | 1,720 | +10.0 | +8.8 |
Group Energy Services sales totalled €1,720 million in first-quarter 2021, up by 8.8% in organic terms owing to the sharp rise in gas prices reflected in Dalkia sales. Sales were also boosted by growth in service activities in France and in Italy.
Framatome
(in millions of euros) | Q1 2020 | Q1 2021 | Organic change (%) |
Sales (14) | 794 | 728 | -6.2 |
EDF Group contributive sales | 512 | 405 | -17.6 |
Framatome posted first-quarter revenue of €728 million, down by 6.2% on an organic basis.
The decrease mainly resulted from unfavourable timing effects in the first quarter 2021 owing to the phasing of fuel assembly deliveries over the year, notably for the Taishan EPR.
Framatome is committed alongside TVO and AREVA to the fuel loading of the Olkiluoto 3 EPR in Finland, which has been authorised since 26 March 2021.
Framatome strengthened its positions in Europe through the acquisition of the control-command business of Evopro Nuclear and Process Automation (NPA) Kft in Hungary.
As part of the call for projects to support nuclear industry investments and modernisation, three Framatome projects have been selected and will be backed by the France Relance recovery plan.
United Kingdom
(in millions of euros) | Q1 2020 | Q1 2021 | Organic change (%) |
Sales (15) | 2,748 | 2,689 | -0.9 |
In the United Kingdom, sales amounted to €2,689 million in the first quarter of 2021, down by 0.9% in organic terms compared to the first quarter of 2020.
This evolution can mainly be attributed to a contraction in the consumption of industrial and professional customers.
Supply activity benefited from an increase in consumption volumes of residential customers, due in particular to the cold weather and the take-over of a customer portfolio.
Nuclear generation stood at 10.5TWh, down 1.4TWh compared to the first quarter of 2020 following the extended outage of the Hinkley Point B reactors and the planned outage of reactor 1 at Torness.
The Dungeness B reactors are still offline.
Thermal output was down by 1.0TWh due to the price context.
Italy
(in millions of euros) | Q1 2020 restated (16) | Q1 2021 | Organic change (%) |
Sales (1) | 1,715 | 2,029 | +18.5 |
Sales amounted to €2,029 million in the first quarter of 2021, up by 18.5% in organic terms compared to 2020 first quarter.
Sales from gas activities rose by €272 million thanks to the increase in spot gas prices on the wholesale market, both upstream and downstream, though with a limited impact on EBITDA.
Sales from electricity activities were up by €44 million in connection with a limited positive price effect due to the indexation of contracts in a context of rising electricity spot prices on the wholesale market.
Supply activity benefited from a slight increase in the customer portfolio and from an increase in gas volumes sold to professional customers.
In addition, thermal output was up compared to the first quarter of 2020, which was marked by technical unavailability, and ancillary services performed well. Wind generation also increased during the quarter.
Other developments:
Acquisition of the remaining 70% shares in E2i Energie Speciali (674MW)
Moody’s upgrade of Edison’s rating from Baa3 to Baa2
Other international
(in millions of euros) | Q1 2020 | Q1 2021 | Organic change (%) |
Sales (17) | 727 | 693 | -0.3 |
of which Belgium | 539 | 512 | -6.1 |
of which Brazil | 130 | 139 | +32.3 |
Sales for the Other International segment came out at €693 million in the first quarter of 2021, down by 0.3% in organic terms compared to the first quarter of 2020.
In Belgium (18), sales were down by €33 million in organic terms (-6.1%) reflecting a fall in forward prices in 2020. The annual contract indexation (notably for residential customers), which takes place gradually throughout the year, does not yet fully reflect the recent rise in gas prices on the wholesale markets. However, sales benefited from the increase in gas volumes sold to residential customers resulting from a more favourable weather effect than in the first quarter of 2020 and from the growth in volumes sold to professional and industrial customers.
The development of wind power is moving ahead, with a net installed capacity of 551MW (19) at end-March 2021.
In Brazil, revenue increased by €42 million in organic terms (+32.3%), mainly due to the 25% revaluation of the Power Purchase Agreement (PPA) in November 2020 for the EDF Norte Fluminense plant, in line with the indexation to gas prices and with the change in the ICMS tax (20) (with no impact on EBITDA). The foreign exchange effect was unfavourable in the first quarter, the Brazilian real declining versus the Euro.
Other activities
(in millions of euros) | Q1 2020 | Q1 2021 | Organic change (%) |
Sales (21) | 664 | 891 | +35.1 |
Of which gas activities | 252 | 377 | +49.6 |
Including EDF Trading | 303 | 396 | +31.7 |
Sales for Other activities amounted to €891 million in the first quarter of 2021, up by 35.1% in organic terms compared tothe first quarter of 2020.
Sales for the Group gas activities increased by 49.6% compared tothe first quarter of 2020 in a context of very favourable trends in gas prices on the wholesale market and improved use of Group’s capacities. However, these effects had a limited impact inEBITDA.
EDF Trading revenue totalled €396 million, up by 31.7% in organic terms compared to first quarter 2020 in a context of high volatility in trading activities in the United States and Europe.
Main highlights (22)
since the announcement of 2020 full-year results
Nuclear
EDF submitted to the Indian nuclear operator NPCIL the French binding technical and commercial offer to build six EPRs at the Jaitapur site (see PR of 23 April 2021).
Renewables (23)
EDF Renewables North America has been awarded three contracts for solar projects in New York (see PR of 5 May 2021).
EDF Renewables commissioned a 344 MW wind complex in Brazil (see PR of 5 May 2021).
Middle East’s largest wind farm in the Kingdom of Saudi Arabia reached halfway mark on construction (see PR of 12 April 2021).
Masdar-EDF Renewables-Nesma consortium reached financial close and started construction on 300 MW solar project in Saudi Arabia (see PR of 12 April 2021).
The EDF and SNCF groups signed their first contract on the purchase of renewable electricity for a 20-year period (see PR of 7 April 2021).
Launch of the photovoltaic plant project at the Deauville-Normandy airport (see PR of 26 March 2021).
EDF Renewables is to build a new ground-based photovoltaic project in the Vienne department (see PR of 5 March 2021).
EDF Renewables, Enbridge and wpd launched the construction of the Calvados offshore wind farm (see PR of 22 February 2021).
EDF Energy (24)
EDF signed binding agreement on the sale of the West Burton B CCGT plant to EIG (see PR of 9 April 2021).
Edison (25)
Edison completed the sale of Infrastrutture Distribuzione Gas (IDG) to 2I Rete Gas for €150 million (see PR of 30 April 2021).
Moody’s upgraded Edison’s rating from Baa3 to Baa2 owing to the company’s improved risk profile, profit growth and increased cash flow (see PR of 19 April 2021).
Edison completed Edison Norge sale to Sval Energi for a value of USD 374 million (see PR of 25 March 2021).
Other
Shareholders’ General Meeting of 6 May 2021: all the resolutions were adopted (see PR of 6 May 2021).
Creation of the nuclear professions’ university (see PR of 27 April 2021).
The EDF Group and Pôle Emploi committed to the employment and inclusion of young people (see PR of 24 March 2021).
The EDF Group created Datanumia, a subsidiary specialised in the optimisation and management of energy consumption (see PR of 19 March 2021).
The EDF Group stepped up its distributed solar and off-grid business in Kenya (see PR of 25 February 2021).
As a major player in energy transition, the EDF Group is an integrated energy company active in all businesses: generation, transmission, distribution, energy trading, energy sales and energy services. EDF group is a world leader in low-carbon energy, having developed a diverse production mix based mainly on nuclear and renewable energy (including hydropower). It is also investing in new technologies to support 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 is involved in supplying energy and services to approximately 37.9 million customers (1), of whom 28.7 million in France (2). It generated consolidated sales of €69.0 billion in 2020. EDF is listed on the Paris Stock Exchange. |
Since 2018, customers are counted per delivery site. A customer can have two delivery points: one for electricity and another one for gas.
Including ÉS (Électricité de Strasbourg).
This presentation does not constitute an offer to sell securities in the United States or any other jurisdiction.
No reliance should be placed on the accuracy, completeness or correctness of the information or opinions contained in this presentation, and none of EDF representatives shall bear any liability for any loss arising from any use of this presentation or its contents. The quarterly financial information is not subject to an auditor’s report.
The present document may contain forward-looking statements and targets concerning the Group’s strategy, financial position or results. EDF considers that these forward-looking statements and targets are based on reasonable assumptions as of the present document’s publication, which can prove to be inaccurate and are subject to numerous risks and uncertainties. There is no certainty that the forecast events will take place, or that the expected results will actually be achieved. Important factors that could cause actual results, performance or achievements of the Group to differ materially from those contemplated in this document include, in particular: the successful implementation of EDF strategic, financial and operational initiatives based on its current business model as an integrated operator, changes in the competitive and regulatory framework of the energy markets, as well as risk and uncertainties relating to the Group’s activities, its international scope, the climatic environment, the volatility of raw material prices and currency exchange rates, technological changes and changes in the economy.
Detailed information regarding these uncertainties and potential risks is available in EDF’s Universal Registration Document (URD), filed with Autorité des Marchés Financiers (AMF) on 15 March 2021, which is available on AMF's website at www.amf-france.org and on EDF’s website at www.edf.fr , as well as in 2020 financial report, available on the EDF website.
EDF does not undertake nor does it have any obligation to update forward-looking information contained in this presentation to reflect any unexpected events or circumstances arising after the date of this presentation.
This press release is certified. Its authenticity can be checked on medias.edf.com
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1 () Organic change at comparable scope, standards and exchange rates.
2 () See Q1 2021 appendices on Flamanville 3, pages 5 and 6.
3 () EDF is neither an investor nor in charge of construction.
4 () The coal-fired plant in Le Havre has been shut down and mothballed (multi-year guaranteed shutdown) since end-March 2021 and will be disconnected from the grid by end-2021.
5 () Ethereum is a decentralised exchange protocol that allows users to create smart contracts.
6 () Subject to additional reinforced sanitary restrictions impacts.
7 () On the basis of scope and exchange rates at 01/01/2021.
8 () Sum of personnel expenses and other external expenses. At constant scope, standards, exchange rates and pension discount rate, excluding inflation. Excluding sales costs of energy services activities and Framatome’s nuclear engineering services and specific projects such as Jaitapur.
9 () Signed or completed disposals: impact on the Group’s economic debt.
10 () Payout ratio based on net income excluding non-recurring items, adjusted for the remuneration of hybrid bonds accounted for in equity.
1 () The data published in respect of 2020 have been restated for the impact of the change in scope of the Edison’s E&P disposal. The sale of the E&P activities in Norway was closed in March 2021.
2 () Organic change at comparable scope, standards and exchange rates.
3 () Breakdown of sales by segment, before inter-segment eliminations.
4 () Price and volume effects are calculated by convention on the basis of the average hedged price of electricity generation (nuclear, hydro and thermal).
5 () Hydro output excluding French island activities before deduction of pumped volumes. For your information, after deduction of pumped volumes: 11.7TWh at end-March 2020 and 12.2TWh at end-March 2021.
6 () Regulated activities including Enedis, ÉS and island activities.
7 () Breakdown of sales by segment, before inter-segment eliminations.
8 () Indexation of TURPE 5 distribution: +2.75% on 1st August 2020.
9 () Breakdown of sales across the segments, before inter-segment eliminations.
10 () For the renewable energy generation optimized within a larger portfolio of generation assets, in particular relating to the French hydro fleet after deduction of pumped volumes, revenue is estimated, by convention, by valuing output generated at spot market prices (or at purchase obligation tariff) without taking into account hedging effects, and include the valuation of the capacity, if applicable. This convention is the best reflection of the use of the hydro fleet and differs from the convention used in the France - Generation and supply activities, in which all generation (nuclear, hydropower, thermal) is valued on the basis of the average hedged price for the generation fleet.
11 () Production after deducting consumption of pumped volumes.
12 () Breakdown of sales by segment, before inter-segment eliminations.
13 () Group Energy Services include Dalkia, Citelum, CHAM and the service activities of EDF Energy, Edison, Luminus and EDF SA. These include street lighting, heating networks, decentralized low-carbon generation based on local resources, energy consumption management and electric mobility
14 () Breakdown of sales by segment, before inter-segment eliminations.
15 () Breakdown of sales by segment, before inter-segment eliminations.
16 () The data published in respect of 2020 have been restated for the impact of the change in scope of the Edison’s E&P disposal. The sale of the E&P activities in Norway was closed in March 2021.
17 () Breakdown of sales by segment, before inter-segment eliminations.
18 () Luminus and EDF Belgium.
19 () Net capacity at Luminus scope. Gross installed wind capacity was 592MW at end-March 2021 vs. 588MW at end-December 2020.
20 () Imposto sobre Circulação de Mercadorias e Serviços, a tax on the circulation of goods and services in Brazil.
21 () Breakdown of sales by segment, before inter-segment eliminations.
22 () The full list of press releases is available on our website: www.edf.fr
23 () The full list of press releases is available on our website: www.edf-renouvelables.com
24 () The full list of press releases is available on our website: www.edfenergy.com
25 () The full list of press releases is available on our website: www.edison.it
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