Edf launches a large capital increase. France's largest energy producer and distributor today announced the launch of an increase of over 3,1 billion euros, of which 2.654 billion provided by the state, a shareholder of the company with an 84,4 per cent stake.
The operation will serve to strengthen EDF's finances, which have been put to the test by a series of vicissitudes. The group has to deal with problems with nuclear production and government measures to contain the increase in bills.
Edf's crisis
Earlier in the week, the company launched a warning on earnings prospects for 2022, after the big alarm on the January guidance. In detail, EDF has announced a clear downward revision of its estimates on the 2022 EBITDA due to the problems concerning the production linked to nuclear energy and with the volume of electricity that the State requires to sell at a low price.
The group has estimated an impact of the Arenh (regulated access to historical nuclear electricity) equal to -10,2 billion euros against -8,4 billion initially estimated and has forecast a decline in production for the current year due to the restructuring that will impose the closure of several nuclear reactors: a closure that will cost 16 billion euros in ebitda, against the 11 billion euros initially estimated. Based on forecasts, the company may not meet its financial goals because it is forced to sell energy at lower prices to those of the market and for a lower production from nuclear power.
Edf: the capital increase
Going back to today, according to the note released by Edf, the net proceeds of thecapital increase of 3,1 billion euros will be used to finance development activities in the period between 2022 and 2024, strengthen the creditworthiness of the group and its access to financial markets and, more generally, strengthen the financial flexibility of the group.
After the announcement, on the Paris Stock Exchange, the title Edf vit floats up 0,7% to 9,38 euros per share.
