EDP beats profit forecasts as CPPIB sells stake and utility boosts green energy investment
A major shift is underway in global pension investment as the Canada Pension Plan Investment Board (CPPIB) moves to sell its entire 5.4 percent stake in Portuguese energy giant EDP SA, a transaction that could raise approximately US$1.03bn based on recent share prices, according to Bloomberg.
The sale, arranged by Goldman Sachs Group Inc., comes at a time when EDP’s shares have experienced a 9.7 percent drop following a profit decline and a narrowing of its full-year guidance.
EDP, Portugal’s largest power utility, recently reported a 12 percent fall in nine-month profit, weighed down by smaller capital gains, but still managed to beat market expectations, as reported by Reuters.
Consolidated net profit reached US$1.11bn, surpassing the LSEG consensus estimate, while EBITDA fell 3 percent year over year to €3.8bn.
The company’s wind energy subsidiary, EDP Renovaveis, saw capital gains from asset sales drop significantly to €35m from €167m a year earlier, reflecting a strategic shift to fund new projects by disposing of stakes in mature assets.
As a result, the unit’s profit fell 49 percent to €107m.
Despite these challenges, EDP noted that recurring net profit, excluding asset sales, increased by 5 percent year over year, driven by a 14 percent rise in electricity output from new capacity, with strong contributions from its operations in the United States, Portugal, and Spain.
EDP also unveiled a new strategic plan to invest €12bn between 2026 and 2028 to expand wind and solar energy projects and power networks in Iberia, as reported by Bloomberg.
