INTERNATIONAL Power (IP), the producer majority owned by French utility GDF Suez, yesterday posted yearly profit slightly above market expectations, with growth in the Middle East offsetting slowing sales in the UK and US.
The firm, which was formally taken over by GDF last month, said yesterday underlying profit from operations was down about three per cent to £995m.
That compared to analysts’ average forecast for operating profit of about £942.4m.
Revenues fell 9.2 per cent to £3.34bn last year.
However, the firm has cut its dividend to 10.91p from 12.53p in 2009.
Analysts at Nomura said the results beat their forecasts, largely due to a lower-than-expected effective tax rate of just 16 per cent.
Investec said the results “provide a fitting swan song for Old IPR, beating market expectations and showing continued growth from existing capital expenditure”.
Profit from operations in the Middle East was up 28 per cent, while in Asia it rose nine per cent, somewhat offsetting a drop in the firm’s core European market.
GDF hopes to combine its assets in the Middle East, North America and Latin America with IP’s as part of its efforts to create a global producer worth $30bn. IP shares fell 1.7 per cent to 327.5p yesterday.
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GDF Suez paid €21.5bn (£18.14bn) to take over a 70 per cent stake in International Power last August.
The new company has a 66 gigawatt capacity and expected annual sales of €84bn.