Engie HY Profit Climbs; Upgrades FY Guidance

French natural gas and electricity supplier Engie SA (ENGQF.PK,ENGIY.PK) reported that its net income group share for the first-half of 2021 climbed to 2.34 billion euros from 0.02 billion euros last year. The increase was mainly due to the improvement of net recurring income, the positive impact of the mark-to-market on commodity contracts other than trading instruments and disposals compared to the first half 2020.

Revenue was 31.26 billion euros up 13.9% on a gross basis and up 16.7% on an organic basis. The gross increase was slightly lower than organic growth due to negative foreign exchange effect linked to the depreciation of the US dollar and the Brazilian real against the euros.

The company upgraded 2021 guidance. It now expects annual net recurring income Group share in the range of 2.5 billion euros to 2.7 billion euros, based on indicative 2021 EBITDA range of 10.2 billion euros to 10.6 billion euros and EBIT range of 5.5 billion euros to 5.9 billion euros.

The Group reaffirms the dividend policy, with a 65% to 75% payout ratio based on NRIgs. As a reminder, the Group introduced a dividend floor at 0.65 euros per share for the 2021-2023 period.

Engie announced that it agreed to sell 11.5% of GRTgaz to Caisse des Dépôts and CNP Assurances. This agreement values the GRTgaz group's total equity at 9.8 billion euros for an enterprise value of 14.6 billion euros.

Upon completion, ENGIE will hold 61% and continue to consolidate GRTgaz in its accounts. The transaction will reduce ENGIE's net financial debt by 1.1 billion euros and is expected to be completed before December 31, 2021.

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