Edison: in First Half of 2011 revenues grow to 5,662 million euros (+ 11.3%), EBITDA at 491 million (- 21.6%)

he renegotiation of long-term gas supply contracts with Promgas allows Edison to confirm its estimated EBITDA for 2011 at 900 million euro.Net profit negative for 62 million euro, including writedowns of 77.5 million euro. Net Financial Debt stable at 3.8 billion euro.

Milan, July 25, 2011 – Edison’s Board of Directors met today to review the Semiannual Financial Report at June 30, 2011.

In the first half of 2011 demand of electric power and natural gas settled at levels still considerably lower than those achieved before the financial crisis, confirming that the period of unsettled market conditions that began in 2008, is continuing. In the electric power sector, national demand was up +1.6% compared with the same period in 2010, remaining well below first half 2008 (-4.3%). Italian demand of natural gas was down 4.5% compared with the same period in 2010, for a year-over-year decrease of about 2 billion cubic meters (-8.1% compared with the first half 2008). Lower demand by residential users and reduced consumption by thermoelectric power plants, caused by an increased use of coal-fired power plants and renewable energy systems, are the main reasons for this decline.

The negative effects of weaker demand were magnified by a sharp rise in the price of crude oil (+42% compared with the first half of 2010, at an average price of 111.1 $ per barrel), which, in turn, drove the procurement costs of natural gas purchased under long-term contracts sharply higher.

In the electric power sector, the higher cost of fossil fuels caused an increase in the Time-Weighted Average (TWA) of the Single National Price (PUN), which rose to 67.40 euros/MWh, or 9.4% more than in the first six months of 2010.

In such a complex market scenario Edison has closed the first half of 2011 with revenues up 11.3% to 5,662 million euros, thanks mainly to a healthy performance by the Electric Power Operations (+11.5% compared with the same period of last year) and a positive contribution by the Hydrocarbons Operations (+0.3% compared with the first half of 2010). The revenue gain reported by the Electric Power Operations was driven by higher average sales prices, lifted by the scenario. The revenues of the Hydrocarbons Operations were substantially in line with those reported at June 30, 2010, as higher prices helped offset the impact of lower volumes.