German power firm Eon - which owns Powergen and Central Networks in the Midlands - yesterday raised full-year earnings outlook after reporting forecast-beating first-half profits thanks to rising power and gas prices.
Earnings before interest and tax (EBIT), adjusted for non-recurring effects, rose to £3.2 billion in the first six months from £2.88 billion a year earlier.
A poll of 19 analysts produced an average forecast of £3.12 billion with forecasts ranging from £3 billion to £3.29 billion.
Eon, Europe's second-biggest utility after France's EDF, said it expects 2006 profit to surpass the 2005 level, removing the word 'slight' from its previous guidance of a slight increase.
Net profit in the first half was £1.91 billion, compared with expectations of £1.93 billion.
Dusseldorf-based Eon has bid £18.17 billion in cash to buy Spanish utility Endesa, topping Spanish group Gas Natural's cash-and-share offer valued at £14.6 billion.
Spain's energy regulator has approved Eon's offer with conditions. Eon appealed to Spain's Ministry of Industry.
Eon said UK profits plunged from £413 million to £304 million as it struggled to overcome soaring wholesale gas prices.
The company has refused to rule out UK price increases after a 24.4 per cent hike in gas and 18.4 per cent in electricity in March.
The March increases helped boost performance in the three months to the end of June but prices are still among the cheapest in the UK according to Energywatch. It is the only provider without a second round of increases this year.
EDF customers had a 19 per cent gas rise last month.
