Elia Group First look : FY22 Results beat, Germany turns on Capex tension
Elia Group published a good set of numbers with net profit at 341.7m that beat our estimate of 331.2m, with Germany outperforming. The announced Capex increase to 16bn was confirmed. Nemo Link showed a strong performance, but reached its 5-year cap. The ROE FY22 amounted to 7.52% vs. 7.36% expected, ROE FY23 is guided to a range of 6.0-7.0%, perfectly in line with our 6.5% expectation. Capex is guided to 2.19bn, also in line. Despite the strong results, we will not significantly change our estimates. We will watch the negotiations in GE and BE to adjust the agreed ROE frameworks to the sudden interest rate increase over FY22. Some preliminary talks are held in GE for the FY24-28 period. In BE for the FY24-27 period there is a “clause de rendez-vous” in place, which Elia will use, but this could take more time. The EPS came at 4.80 vs. our expectation of 4.66. The dividend was set at 1.91 per share vs. our expectation of 1.94.Elia System Operator develops, operates and maintains very-high-voltage (380 kV, 220 kV and 150 kV) and high-voltage (70 kV, 36 kV and 30 kV) networks, providing its customers with consultancy and engineering services. Whether in Belgium, Germany or elsewhere in Europe or the U.S., Co. ensures that electricity flows reliably from energy producers to distributors and large corporate customers. Co.'s main activities include transmission operator, system operator and market facilitator, developing and maintaining grid infrastructure, connecting electrical installations to grids, providing transparent access to grids, while taking initiatives to improve electricity market operations.
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