French multinational utility company ENGIE SA has announced its financial results for 2020, revealing a loss of €1.5 billion (£1.3 billion).
Revenues were €55.8 billion (£48.4 billion, down 7.2 per cent on a gross basis and 5.7 per cent on an organic basis, while EBITDA was €9.3 billion (£8.07 billion), down 10.5 per cent on a gross basis and 6.5 per cent on an organic basis.
The €1.5 billion (£1.3 billion) loss, compared with last year’s profit of €1 billion, was put down mainly to the Covid-19 pandemic and a €2.9 billion (£2.5 billion) charge on Belgian nuclear assets.
Headlines include progress at pace on a new strategic direction towards accelerating the energy transition, a strong recovery from second-quarter levels, and a second-half organic performance similar to 2019.
The year marked continued environmental, social and governance progress, with a commitment to stop coal use in Europe by 2025 and globally by 2027. A decision was also made to stop preparation works in Belgium that would allow for the 20-year extension of two nuclear units beyond 2025.
Although it drew a significant hit from Covid-19 in 2020, mainly on client solutions and supply, with about €1.2 billion (£1.04 billion) total group impact at the certificate of insurance level, results were also negatively affected by depreciation at a level of €0.3 billion (£0.26 billion). The report emphasises strong liquidity and a strong investment grade rating.
Catherine MacGregor, the CEO, said: “ENGIE successfully adapted its operations in the face of the unprecedented Covid-19 crisis. In the second-half, activity levels progressively improved leading to H2 organic performance similar to H2 2019. Alongside ensuring delivery of essential services, the group announced a new strategic direction to simplify the group and strengthen ENGIE’s role in the energy transition.
“We have had a good start to the year and we expect financial performance in 2021 to improve significantly. In addition to driving a recovery in performance, we will focus on completing the strategic reviews under way to create value and reallocate capital towards growth, particularly in renewables, networks, and asset-based client solutions.”
MacGregor added: “My leadership team and I are looking forward to turning our new strategic orientation into action, towards further simplification, performance and importantly, towards accelerating the planet’s transition to carbon-neutrality.”
The report indicates that overall financial performance in 2021 is expected to improve significantly after a Covid-19 impacted 2020, assuming there are no more stringent lockdowns and a gradual easing of restrictions during 2021.
Image credit | Engie-Vincent Breton