* E.ON says remaining conservative in FY outlook
* Reiterates 2010 adjusted EBIT might rise 3 pct
* EDF reiterates 2010 EBITDA might increase 5 pct
* CEZ repeats sees 2010 EBITDA down 3 percent
* E.ON down 0.75 pct, EDF slips 0.05 pct, CEZ dips 1.5 pct
(Adds detail, quotes)
By Peter Dinkloh
FRANKFURT, May 11 (Reuters) - European utilities clung to
their 2010 profit outlooks as they reported soaring
first-quarter earnings from a cold winter and not due to
economic recovery on the continent.
German utility E.ON <EONGn.DE>, the world's largest power
provider by sales reiterated it expected adjusted earnings
before interest and taxes (EBIT) to rise as much as 3 percent.
EDF <EDF.PA>, Europe's third-biggest utility by sales,
repeated it expected earnings before interest, taxes,
depreciation and amortisation (EBITDA) to rise as much as 5
percent while Czech peer CEZ <> confirmed its forecast
for EBITDA to drop 3 percent. [] []
Industrial production throughout Europe has been picking up
after manufacturers across the region scaled back production and
idled plants in the face of the lingering economic downturn.
The European Union stated that industrial production, a key
indicator of energy demand, in its 27 member states dropped last
year to levels previously seen a decade ago.
Euro zone industrial output rose much more than expected in
February, highlighting the manufacturing sector's strong role in
economic recovery. It was a 4.1 percent rise on last year,
however it was only a 0.9 percent increase month-on-month.
[]
The utilities are not yet confident about the recovery.
"In Germany, for example, industrial output is still 20
percent below (last year) and power demand year-on-year to date
is still 3 percent lower. Accordingly, the recovery remains
fragile," E.ON said.
"E.ON is remaining conservative regarding the full year and
stands by its cautiously optimistic forecast."
Kepler Capital Markets analyst Ingo Becker said the cold
weather boosted earnings to the extent that it would help the
companies' full-year earnings.
"Utilities have enormously benefitted from the cold winter,"
said "The demand from the winter will be helping the gas and the
power business (throughout the year)."
Becker predicted E.ON's adjusted EBIT would climb 4 percent
while EDF's EBITDA would rise 6.3 percent.
LBBW analyst Bernhard Jeggle agreed that E.ON's EBIT
forecast was conservative.
Both CEZ and E.ON beat market expectations with their
first-quarter earnings. CEZ' net profit dropped 8.6 percent,
less than the 9.9 percent decline seen by analysts in a Reuters
poll, while E.ON's adjusted EBIT, reported last week, rose 20
percent compared to the 16 percent rise expected in a Reuters
poll. []
EDF released only first-quarter sales on Tuesday.
At 1453 GMT, E.ON shares were down 0.75 percent to 25.13
euros, EDF had dipped 0.05 percent to 38.21 euros and CEZ was
down 1.5 percent at 915.00 crowns, compared with a European
utilities index <.SX6P> down 1.0 percent.
Italy's Enel <ENEI.MI> and Germany's RWE <RWEG.DE>, Europe's
fourth- and fifth-largest utility, will report earnings on
Wednesday.
(Editing by Karen Foster and Simon Jessop)
