EDF still penalized by uncertainties

Despite the tariff shield imposed by the State, its turnover jumped 61% in the first quarter.

The situation seems paradoxical for EDF. The government has imposed a tariff shield to protect individuals against soaring electricity prices on the markets. In concrete terms, the rise in prices at 1er February was limited to 4%, whereas it should have reached 24.3% to take market prices into account. Despite this drastic limit, the electrician achieved in the first quarter a turnover up 61%, to 35.6 billion euros. The reason: the tariff shield took the form of a reduction in the domestic tax on final electricity consumption (TICFE), which went to 1er February from 22.50 euros per MWh to just 1 euro. The price of energy excluding tax has, for its part, evolved significantly upwards. EDF thus specifies that the residential tariff excluding tax rose from 128.60 euros per MWh, on 1er August 2021, at 159.90 euros per MWh on 1er last February, i.e. the 24.3% increase already mentioned.

This impact of the rise in energy prices is even greater on manufacturers and professionals. The group also specifies that its trading subsidiary has been very dynamic. In the end, activity in France (production and regulated activities) posted an increase of 31%. Several branches show even greater growth. This is the case of Dalkia, an energy services company, which saw its turnover increase by 49%, or of the Italian subsidiary, which recorded a multiplication by almost 2.5 of its activity, to 7 billion euros. euros.

EDF warns, however, that this sharp increase in its turnover will not result in a similar evolution of its gross operating surplus (Ebitda). The group estimates that the desire to limit the increase in the electricity bill, and in particular the increase in volumes of Arenh, this electricity sold at a very advantageous price to its competitors, will cut its Ebitda by 24 billion euros. throughout 2022. The group is facing another concern: corrosion problems on some of its nuclear reactors. Problems were noted on five reactors. And investigations are still being carried out on four others. In total, France has 56 reactors. The phenomenon is therefore very significant. Combined with the major ongoing maintenance plan, this explains the 7.5% drop in production from the nuclear fleet in the first quarter.

The group has not yet determined the remedies for these corrosion problems. “It will depend on the situation of each reactor”, explains Régis Clément, deputy director of the nuclear production division of EDF. To determine them, EDF is awaiting the position of the Nuclear Safety Authority (ASN) on the file. “We believe that the ASN will give its position by the end of May, says Régis Clément, which will allow us to adjust our strategy. » Given these uncertainties, EDF has not yet quantified the costs associated with these corrosion problems.

The factors of uncertainty are therefore multiple for the French electricity giant. EDF has thus still not provided a financial forecast for its results for the full year. “2022 remains a very difficult year, market volatility is still extreme and the impact of the Ukrainian conflict difficult to quantify”, justified Xavier Girre, the financial director of EDF. Uncertainties that investors did not appreciate. The title EDF lost 2.47% on the stock market on Wednesday. In six months, it drops by more than 30%. A counter-performance which shows that the French group must manage very specific problems. Most energy companies, driven by energy prices, are doing better than EDF on the stock market. Despite the uncertainties linked to the conflict in Ukraine, TotalEnergies has thus posted a rise in its share price of 13% over six months.

SEE ALSO – EDF: the State will participate in the recapitalization with “more than two billion euros»

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