EU UTILITIES: Orsted: 3Q25 Results
Nov-05 11:54
(ORSTED; Baa2/BBB-/BBBneg)
Credit neutral.
- Adj. EBITDA missed by 20%, falling 31%. Margin 3ppts lower at YoY at 25%. Lower wind speeds, subsidy roll off and installation problems were the main drivers. That was despite 8% higher generation on availability and ramp up.
- FFO/ND decreased to 14% from 16% QoQ. Investments outpaced FFO growth. Proforma for the rights issue that would be 52%, with Hornsea 3 proceeds also to come.
- FY25 guidance confirmed.
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OUTLOOK: Price Signal Summary - Bear Theme In Gilts Intact
Oct-06 11:42
- In the FI space, Bund futures are holding on to the bulk of their latest gains. The recent climb appears corrective. Key support and the bear trigger lies at 127.61, the Sep 3 low. Clearance of this level would confirm a continuation of the medium-term bear cycle. For bulls, a clear reversal higher would refocus attention on key resistance at 129.44, the Sep 10 high. First resistance is 128.84, 61.8% of the Sep 10 - 25 bear leg.
- Gilt futures continue to trade above their latest lows. Recent weakness strengthens a bearish theme and does suggest the end of the corrective phase between Sep 3 - 11. Note that on the continuation chart, moving average studies are in a bear-mode position, highlighting a dominant downtrend. A stronger resumption of weakness would open 89.94, the 76.4% retracement of the Sep 3 - 11 corrective phase. Initial resistance to watch is 91.28, the Sep 24 high.
GILTS: Basis Trades
Oct-06 11:15
Gilt Basis trades:
20 minutes ago:
- G Z5 1.46k at 90.48.
Now:
- G Z5 1.46k at 90.54.
EGB FUNDING UPDATE: AFT may publish France's 2026 issuance plans at any time
Oct-06 10:55
- With the 13 October deadline to submit the Budget to parliament almost certain to be missed we look at when the AFT has published its year-ahead funding plans in recent years.
- France's AFT (Agence France Tresor) normally publishes its year-ahead "funding situation" which includes an outline for issuance volumes in September. For reference between 2016-2023 it was published between 22-28 September.
- Last year, despite the political uncertainty, the government did still present a budget to parliament on 9 October - meeting the 70 day timeline required for parliament to deliberate.
- The AFT then published its 2025 provisional plans on 10 October - the day after the budget was submitted to parliament.
- In the absence of anything else, the AFT may choose to use broadly unchanged numbers from 2025 for the deficit size. Together with an extra E10-11bln of MT/IL debt due to mature in 2026, we think that expectations will be for the 2026 gross issuance plan to be around E310-315bln. This follows E300bln in 2025, E285bln in 2024, E270bln in 2023 and E260bln in 2022.
- The AFT may chose to publish this initial estimate at any time - it may decide that the political turmoil won't lead to a definitive outcome any time soon so publish imminently, or may leave until later this year. There is no real precedent here.
- Note that the more detailed update has been published later in the last couple of years: on 19 December in 2024, 13 December in 2023, 7 December in 2022, 10 December in 2021 and 9 December in 2020.
