Uniper Makes Steep 2016 Loss

Uniper, the fossil fuels company spun off last year from Germany’s E.ON, reported a net €3.2bn loss in 2016 on March 9.

The loss was “due in particular to impairment charges of €2.9bn" which Uniper said it booked, after having "reviewed its assumptions regarding the long-term development of commodity and power prices and policy issues relating to decarbonisation".

Impairment charges were primarily in generation -- including €0.4bn on a conventional power plant in France, plus €0.2bn for one power plant each in Germany, UK and Netherlands -- and on gas storage assets including one such writedown by €0.2bn. It also created provisions of €1.1bn.

Uniper said its adjusted operating earnings (Ebitda) of €2.1bn were at the upper end of the company’s guidance range (2015: €1.7bn). But it noted that its European generation results in 2016 “continued to be adversely affected by significantly lower achieved power prices.” An outage at Uniper’s 800 MW Berezovskaya-3 plant in Russia saw its international generation earnings down by a third to €0.2bn.

Its global commodities division saw Ebitda rise by €1.1bn, to €1.5bn; however the main driver was a non-recurring effect resulting from the release of provisions for long-term supply contracts with Gazprom which was recorded as income.

Earlier this week Eneva, the Brazilian generating firm part-owned by Uniper, was struck off the list of companies in which Norway’s $900bn+ Oil Fund invests, as it had failed to reduce its reliance on coal.

On March 5 2017, Uniper agreed to sell its 24.99% share in the Gazprom-operated Yuzhno Russkoye gas field in western Siberia to Austria's OMV; the German firm said the €1.75bn ($1.85bn) sale price would "enable it to fully reach its debt-reduction target well ahead of schedule."  

Mark Smedley