The total market capitalization of the 20 largest European electric and multi-utilities companies totaled €447.78 billion at the end of the second quarter of 2019, according to data compiled by S&P Global Market Intelligence.
Of the 20, half of the companies booked quarter-over-quarter percentage losses in their market cap, while only two recorded double-digit quarter-over-quarter percentage gains, according to the S&P Global Market Intelligence data.
Italy's Enel SpA and Spain-headquartered Iberdrola SA carried on their momentum from the first quarter, securing first and second place, respectively, in the second quarter. Meanwhile, Denmark's Ørsted A/S recorded the biggest quarter-over-quarter increase of 12.5% to come in at fifth and German utility RWE AG — in 12th place — posted the biggest quarter-over-quarter decrease of 8.9%.
Enel saw a 7.6% quarter-over-quarter increase in market value, up to €62.42 billion. During the second quarter of 2019, Enel made a nonbinding offer to acquire Sempra Energy's assets in Chile and Peru, revealed plans to increase its equity stake in Chilean subsidiary Enel Américas SA by up to 5% to around 61.8%, and launched a preemptive rights offering in connection with the capital increase approved by its shareholders on April 30. Moody's also raised its outlook on Enel to reflect its progress in delivering its strategic priorities.
Iberdrola SA's market cap grew 11.6% quarter over quarter to €55.36 billion. Chairman and CEO Ignacio Galán said on the company's second-quarter earnings call that he expects to accelerate investment, as a reaction to various national and state government plans to boost renewables growth. The company also said new network infrastructure in the U.S., U.K. and Brazil, and planned capacity auctions in Mexico, would provide additional growth prospects.
Electricité de France SA suffered from political uncertainty in France around its planned restructuring, and hence recorded a quarter-over-quarter drop of 7.8% to end the quarter with a market capitalization of $33.78 billion. Analysts anticipate that the restructuring — which would see EDF's nuclear business hived off from the rest of the group — could generate considerable value for shareholders, since it will separate the capital-intensive nuclear operations from stock market pressures.
The largest quarter-over-quarter increase was recorded by Danish wind developer Ørsted, which was up 12.5% to end the second quarter of 2019 at €31.93 billion. Ørsted has been on an upward trajectory for some time but its shares likely picked up pace on the back of the company's first quarter results and, more recently, the 1,100-MW offshore wind tender it won in New Jersey — further evidence of the company's expansion into the U.S. renewables market. During the second quarter, Ørsted also raised £900 million to finance its expansion ambitions through 2025.
Tough quarter for U.K. utilities
U.K. regulated utilities, including National Grid PLC and SSE PLC, booked quarter-over-quarter decreases of 1.7% to €31.85 billion and 6.9% to €12.78 billion, respectively. Both companies saw their stock weighed down by a proposal from the opposition Labour party to bring network companies back into public ownership.
Another U.K. utility, Centrica PLC, dropped out of the top 20 list after it issued another weak trading update, which blamed negative impacts from the U.K.'s retail price cap and lower gas prices. Group CEO Iain Conn announced in the company's second-quarter earnings call that it is planning to sell its upstream oil and gas business in addition to its stake in the U.K.'s nuclear power fleet, while also cutting the company's dividend. He also said he plans to leave the company in 2020.