Operating profit at ESB Group fell by more than a third in the first half of the year as energy prices continued to fall.
However, the group said it remained ahead of previous norms, as its business continued to grow.
In its interim results for the period to June 30th, ESB said its revenue fell from €4.9 billion to €3.7 billion year on year. Operating profit for the first six months of 2024 was €446 million, down 34 per cent or €230 million from the same period in 2023. Profit after tax was €171 million, and earnings before interest, tax, depreciation and amortisation were €883 million, down from over €1 billion a year earlier.
The group attributed the decline to lower energy margins in its generation and trading business as prices continued to stabilise following the volatility of 2022 and early 2023.
The interim results also include an exceptional provision of €135 million related to the Neart na Gaoithe offshore wind project, due to construction delays.
ESB chief financial officer Paul Stapleton said the performance for the first half of the year was a reflection of more stable global energy markets. “The significant softening of wholesale market prices has reduced the level of profitability in our generation business in both Ireland and the UK compared to the same period last year. However, increased profits from our networks’ businesses, reflecting the continued substantial investment in those areas, provided resilience to the Group position and a robust overall performance,” he said.
The ESB-owned utilities supplier Electric Ireland has announced three energy price cuts in the past year, including one earlier this month. “Electric Ireland has passed on the benefit of wholesale price reductions to its customers,” said Mr Stapleton. “However, we are very mindful of the impact of continued elevated energy prices, and we remain committed to supporting our customers in so far as we can.”
The organisation continued to invest in infrastructure, spending €751 million during the first six months of the year. The bulk of this was in electricity network infrastructure under agreed regulatory programmes.
About six GigaWatts (GW) of grid-scale renewables have now be connected to Ireland’s electricity grid, including more than 1GW of solar PV generation. ESB has also connected 1GW of storage, and continues to invest in decarbonising the electricity system.
“ESB remains committed to further growth in the level of capital investment to ensure a reliable and sustainable electricity system as we transition to net zero,” Mr Stapleton said. “Maintaining the financial strength of ESB is critical in allowing us to continue to fund this investment.”
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