Endesa 3Q Net Seen Down On Lower Hydroelectric Generation
22 Ottobre 2010 - 10:47PM
Dow Jones News
Chile's largest power generator, Empresa Nacional de
Electricidad SA (EOC, ENDESA.SN), will again likely record a
year-over-year decline in third-quarter earnings, as costs surged
because of reduced hydroelectric power generation.
Endesa, as the company is known, turned to more expensive
thermal generation, including liquefied natural gas and diesel, and
also bought pricey energy on the spot market, as a particularly dry
rainy season curtailed its hydroelectric generation. About half of
Endesa's installed capacity in Chile is in hydroelectric
generation.
"On average hydroelectric power generation costs some $18 per
megawatt hour, while generation with diesel is $130 per megawatt
hour and using liquefied natural gas is $110 per megawatt hour,"
said Tomas Gonzalez, energy analyst with local investment bank
Celfin Capital.
Due to the sparse rainfall this year, Endesa increased its usage
of coal-fired generation some 122% in the third quarter, while
hydroelectric generation fell 29%, Gonzalez added.
Endesa's net profit is expected to drop to 139.4 billion Chilean
pesos ($286.4 million) from CLP177.9 billion the previous year,
according to Sergio Zapata, energy analyst, with investment bank
Banchile Inversiones.
Its Ebitda--or earnings before interest, taxes, depreciation and
amortization--will likely fall to CLP285.9 billion from CLP330.2
billion, Zapata said.
However, analysts expect Endesa's quarterly sales to increase as
energy demand rises alongside the quickly expanding economy.
Sales are estimated to have expanded 3.8% to CLP641.5 billion in
the quarter, said Cristian Jadue, energy analyst with local
investment bank Santander GBM.
The power company has 13,864 megawatts of installed capacity
distributed in Argentina, Chile, Colombia and Peru, with roughly
60% in hydroelectric generation and the rest in gas- and coal-fired
power plants. Some 40% of the company's capacity is installed in
Chile.
Meanwhile, Enersis SA (ENI, ENERSIS.SN), the power generator's
holding company, is expected to record third-quarter profit of
CLP151.1 billion, down from CLP173.9 billion last year, and a
decline in Ebitda to CLP590.8 billion from CLP624.9 billion,
according to Banchile Inversiones' Zapata.
Enersis, which is owned by Spain's Endesa SA (ELEZF, ELE.MC), is
expected to see its sales edge up to CLP1.484 trillion from
CLP1.470 trillion.
In addition to all of Endesa's assets, Enersis owns a
power-distribution business and 987 megawatts of generation in
Brazil.
Endesa and Enersis expect to release their quarterly results
early next week.
Late Friday, Endesa's shares gained 0.2% to CLP864.00, and
Enersis was down 0.5% CLP223.00, while the blue-chip Ipsa index
dipped 0.2% to 4775.62.
Over the last 52 weeks, Endesa's shares have traded at a low of
CLP767.62 and a high of CLP924.73, while gaining 2.4% over the
period. Enersis has traded at a low of CLP182.82 and high of
CLP244.36 over the last 52 weeks, while gaining 12.2%.
-By Anthony Esposito, Dow Jones Newswires; 56-2-715-8929;
anthony.esposito@dowjones.com