🔥 Premium AI-powered Stock Picks from InvestingPro Now up to 50% OffCLAIM SALE

Engie flags hit from windfall taxes and dismantling of some Belgian nuclear sites

Published 2022-12-20, 10:26 a/m
© Reuters.

By Scott Kanowsky 

Investing.com -- French energy group Engie SA (EPA:ENGIE) warned that it expects net profit will be hit by as much as €1 billion (€1 = $1.065) in 2022 from European levies on additional revenues made from power production.

The company warned that taxes from Belgium, France and Italy on turnover made by non-gas electricity producers will also negatively affect earnings by between €1.1B - €1.4B next year. The rules have been described as a way to siphon "excess" sales from power firms following a recent spike in energy prices.

Engie estimates that these measures will impact net recurring income by as much as €1.4B in 2023 as well. Earnings before interest and taxes are anticipated to take a charge of between €0.7B - €0.9B in 2022 and €1.2B - €1.5B next year.

The European Union first recommended in September that the levies be placed on energy companies' extra revenues, although individual member states have chosen to implement the rule on a domestic level in various ways.

Engie said it "retains the possibility" to dispute the taxes that, in its view, do not comply with legal standards and "introduce unjustified discrimination between operators or energy sources."

Meanwhile, in a separate disclosure on Tuesday, Engie said the amount of provisions it will need to put aside for the dismantling of some nuclear power plants in Belgium would rise by an extra €2.3B for year-end 2022.

Shares in Engie dropped by more than 4%, despite the gas supplier saying it would maintain its full-year guidance for recurring net profit in the range of €4.9B - €5.5B.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.