November 8, 2018 / 6:58 PM / a year ago

UPDATE 1-Portuguese power company EDP's profit hit by one-offs

(Adds CEO remarks, details)

LISBON, Nov 8 (Reuters) - Power utility EDP-Energias de Portugal suffered a 74 percent drop in nine-month net profit, it said on Thursday, citing one-off factors that meant it could stick with its previously stated full-year guidance.

Portugal’s biggest company by assets, which is the target of a takeover bid by China Three Gorges, said net earnings for the first nine months of the year were 297 million euros ($339 million). Excluding one-offs, such as government-ordered compensation payments, net profit was up 2 percent at 570 million euros, it said.

Core earnings (EBITDA) fell 26 percent to 2.41 billion euros on revenue down 6 percent.

CEO Antonio Mexia told Reuters that the company was sticking to its latest forecast for full-year results, putting net profit at between 500 million and 600 million euros, with EBITDA at 3.4 billion euros.

The nine-month earnings drop was mostly attributable to tax and regulatory pressures in its domestic market, amounting to losses of 319 million euros, as well as lower earnings at its wind energy unit EDP Renovaveis and one-off gains a year ago.

EDP incurred losses from a government-imposed reduction in the final compensation paid to the former monopoly for giving up some long-term power-purchase deals, an increase of clawback tax in August 2017 and higher costs related to the so-called social tariff for low-income households.

Asked about CTG’s 9 billion euro offer for the company, Mexia said regulators and the Chinese state-owned company were “doing their job” and there “clear signs that work is being done in the context of the offer”. ($1 = 0.8765 euros) (Reporting By Sergio Goncalves Writing by Andrei Khalip Editing by David Goodman)

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