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Investing.com -- Engie (EPA:ENGIE)shares dropped more than 4% Friday after the electric utility company missed second-quarter earnings estimates, dragged down by weaker hydroelectric output and negative retail timing effects.
EBIT excluding nuclear fell to €1.4 billion, 24% below Jefferies’ forecast and down 28% year-over-year.
“A negative print, but we continue to see a constructive earnings story for Engie in the balance of 2025, considering the reiterated guidance which we see as inline with our estimates,” said analysts at Jefferies in a note.
Total (EPA:TTEF) EBIT declined 34% from a year earlier to €1.5 billion, falling 23% short of Jefferies estimates and 9% under the consensus compiled by FactSet.
The Supply & Energy Management division posted the steepest shortfall. EBIT dropped 66% year-over-year to €245 million, 51% below Jefferies’ estimate.
Within the segment, B2C operations recorded a €128 million loss versus a forecasted €55 million gain, due to timing effects occurring earlier than expected.
GEMS underperformed as well, with EBIT at €372 million, missing the €448 million estimate due to a one-off charge and reduced activity.
Renewables & Flex (NASDAQ:FLEX) Power EBIT fell 11% year-over-year to €836 million, missing Jefferies’ projection by 8%.
Renewables and BESS contributed €580 million, 24% below expectations. Gas generation offset some of the decline, beating estimates by 81% with EBIT of €257 million.
In the Infrastructures segment, EBIT rose to €506 million, up 25% from the prior year but 3% below forecast.
Networks outperformed with EBIT of €463 million, up 28% and 14% above estimate, while Local Energy Infrastructures met last year’s level at €42 million, but missed expectations by 64%.
Nuclear EBIT came in at €97 million, in line with the €100 million estimate. Net recurring income group share for the first half of 2025 totaled €3.1 billion.
Economic net debt increased to €46.8 billion from €46.1 billion at the end of 2024. The leverage ratio stood at 3.1x, implying roughly 1x headroom on a net debt-to-EBITDA basis.
Despite the quarterly miss, Engie reaffirmed its full-year 2025 guidance. The company maintained its EBIT ex-nuclear target of €8-9 billion and net recurring income group share guidance of €4.4-5 billion.
Updated assumptions include a EUR/USD rate of 1.14 and commodity prices as of June 30.
The forecast for recurring net financial costs was narrowed to a range of negative €2 billion to €2.2 billion, from a previous range of negative €2.1 billion to €2.3 billion.