That privatisation, approved by its municipal shareholders in October, has been slowed by disputes that led to the dismissal of both its CEO and chairman, and an investigation into board decisions during the dispute
AMSTERDAM: Dutch energy company Eneco reported a sharp fall in first-half operating earnings on Friday, blaming costs related to its planned privatisation.
That privatisation, approved by its municipal shareholders in October, has been slowed by disputes that led to the dismissal of both its CEO and chairman, and an investigation into board decisions during the dispute.
Eneco said first-half operating profit fell to 115 million euros ($134 million) from 135 million euros in the same period a year ago.
Employee benefits expenses and costs of external consultants both rose sharply and were the main reason for the fall in operating profit.
Eneco forecast full-year earnings would be “substantially lower” due to ongoing investment costs and costs related to its planned privatisation.
“But these are mostly one-offs”, Chief Executive Ruud Sontag told reporters. “From next year on, we will benefit from our recent takeovers.”
Those acquisitions, such as a large stake in German renewable energy supplier Lichtblick and the Belgian activities of Italy’s Eni, drove revenues up 31 percent in the first half to 2.1 billion euros.
Gross margin – the difference between its revenues and its cost of purchasing and producing energy – dipped to 526 million euros from 528 million.
Before the company’s recent results and the dispute over its privatisation, analysts had valued the business at around 3 billion euros. Major oil companies including Shell and utilities around Europe have expressed interest in Eneco, given its relatively large exposure to renewable assets.
($1 = 0.8559 euros)