Italian energy giant Enel saw its net profit fall 27.7% to 1.03 billion euros in the first quarter, driven by a decline in revenue due to lower electricity and gas prices. This result, published on Wednesday, is below the consensus of analysts from the financial information provider Factset, who on average expected a profit of 1.13 billion euros.
Excluding exceptional items, net income was 1.51 billion euros, up 1.9%. Enel’s revenues fell by 22.6% to 26.41 billion euros, due to a “gradual decline in energy prices following the normalization of the energy context,” the group commented. Gross operating profit(Ebitda), however, rose by 4.7% to 4.76 billion euros.
The “excellent” results of the first quarter “offer a clear visibility on the rest of the year”, allowing to confirm the objectives for 2023, commented the CEO Francesco Starace, quoted in the release. The group thus expects Ebitda excluding exceptional items to be between 20.4 and 21 billion euros and net profit excluding exceptional items to be between 6.1 and 6.3 billion euros.
Enel’s net debt fell by 1.9% to 58.9 billion euros in the first quarter. In order to reduce its debt, Enel has planned asset disposals of 21 billion euros as part of its 2023-2025 strategic plan, a target of which more than half has already been achieved, according to Starace. These are the latest results presented by Francesco Starace, 68, CEO of Enel since 2014 and whose third term is expiring.
Under his leadership, Enel was one of the first groups in the energy sector to embrace sustainability. In mid-April, the right-wing and far-right coalition in power proposed to replace him with Flavio Cattaneo, 59, executive vice-president of the private railway operator Italo-NTV. Paolo Scaroni, president of the AC Milan soccer club and close to Silvio Berlusconi, has been appointed chairman of Enel, where he was CEO from 2002 to 2005. The controversial figure has often been criticized for his close ties to Moscow that he forged during his tenure as CEO of Eni that ended in 2014.
However, the choices made by the Italian state, which owns 23.6% of Enel, will still have to be formally approved by the shareholders at the general meeting scheduled for May 10, which promises to be very tense. Three lists of candidates will be put to the vote at this assembly, including one by the investment fund Covalis Capital, which is proposing Italian banker Marco Mazzucchelli as president to counter the influence of the Meloni government.
