Getlink sees lower earnings as boost from energy market fades (updated)

Jacobs Solutions

29/02/2024 11:04

(Adds details on energy market in paragraph 1, shares in 2,
broker comment in 6)
    By Nathan Vifflin
       Feb 29 (Reuters) - Getlink  GETP.PA , which runs the
undersea tunnel between France and Britain, on Thursday forecast
a drop in core earnings this year as a return to more normal
conditions in energy markets ends an unusual boost for its
ElecLink business.  
    The company's shares rose as much as 5.9%, however, as some
analysts said the guidance had already been priced in.
    Getlink said it expected earnings before interest, taxes,
depreciation, and amortization (EBITDA) of 780-830 million euros
($846-$901 million) this year, after 910 million euros in 2023.
    "We have come through four years of extraordinary
conditions, and ElecLink in particular has benefited from
exceptional market conditions. Today, the energy market is
returning to normal." Getlink Chief Executive Officer Yann
Leriche told reporters on a call.
    ElecLink, an underwater cable enabling electricity exchange
between France and Britain, was launched in May 2022 and has
benefited from unusually high price gaps for electricity between
the two countries, caused by the war in Ukraine.
    Broker J.P. Morgan said in a note that "an underwhelming
guidance was largely already expected", adding it "could be a
clearing event for investors to come back in the shares".
    For 2024, ElecLink has sold 71% of its interconnector
capacity, which would generate 292 million euros in revenues,
Getlink said.
    The company posted EBITDA of 979 million euros for 2023,
ahead of analysts' forecast of 960 million in an LSEG poll.
    Consolidated net profit was 326 million euros, against
expectations of 305 million.
    ($1 = 0.9216 euros)

 (Reporting by Nathan Vifflin
Editing by Mark Potter)
 ((nathan.vifflin@thomsonreuters.com ; +48 58 769 67 13))