Innogy SE (IGY.XE) said Wednesday that it had cut its 2017 and 2018 forecasts, citing the difficult retail environment and the agreement with SSE PLC (SSE.LN) to create an independent British energy retail company that will be listed.
Adjusted earnings before interest, taxes, depreciation and amortization, or Ebitda, for 2017 is now expected to be 4.3 billion euros ($5.1 billion), down from EUR4.4 billion, the company said.
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Adjusted Ebit is anticipated to be EUR2.8 billion, down from EUR2.9 billion.
The company attributed the lowered guidance to the difficult market environment in the U.K. retail business, and said its restructuring programme wasn't enough to offset negative market effects.
Innogy also said it expects 2018 adjusted Ebit of EUR2.7 billion.
Part of the reason for the decline from 2017 is because its U.K. retail business will be classified as a discontinued operation once the SSE deal is complete. Adjusted net income is also expected to be lower than in 2017, with the company anticipating a figure of above EUR1.1 billion.
In November, the company reached an agreement to merge its U.K. retail business npower with SSE's household energy and energy services business. If the deal completes, Innogy will hold a 34.4% stake in the combined business.
The deal is expected to be completed by the last quarter of 2018 or the first quarter of 2019, subject to regulatory and shareholder approval.
Write to Euan Conley at email@example.com
(END) Dow Jones Newswires
December 13, 2017 09:24 ET (14:24 GMT)