MILAN, (Pakistan Point News - APP - 28th july, 2016) - Italian energy giant Enel on Thursday revised upwards its profit forecast for 2016 after first-half net profit remained stable despite a sharp fall in revenue. Group net profit from January to June was 1.8 billion Euros ($2.0 billion), an increase of just 0.1 percent over a year earlier. Revenue fell by 9.3 percent, to 34.15 billion euros, reflecting in part lower income from electricity sales in rich markets, it said in a statement.
In this light, the firm said it was hiking its financial targets for 2016, boosting group profit forecast from 3.1 billion to 3.2 billion euros. "We have delivered a strong set of results in the first half of the year, with the Italian and Latin American markets showing particularly pleasing progress, in spite of a challenging set of macro-economic conditions," Enel CEO Francesco Starace said. He also pointed to the success of a programme of asset disposals.
"We have now finalised over four billion euros of disposals, which is around 70 percent of the five-year target," he said. Starace, appointed Enel's chief in 2014, has vowed to give renewables a strategic thrust. Its subsidiary Enel Green Power, which markets wind, solar and hydro in Europe and North and South America, was folded into the parent company earlier this year. To simplify organisation, Enel said it was selling the Spanish unit of Enel Green Power to Spanish energy company Endesa, also controlled by Enel.
The sale is for the 60 percent of the unit that Endesa did not already have, at a price of 1.2 billion euros. This does not affect the group's balance sheets as it is a transfer of assets between two components of the same corporation, Enel said. Group net debt at the end of June was 38.1 billion euros, against 37.5 billion at the end of 2015.