WRAPUP 1-EDF, Enel say business resists economic downturn

* EDF Q1 sales up 15.1 pct, tops forecasts

* Enel sees good profitability despite weak scenario

* EDF says resisting well despite tough economic conditions

* Enel's debt at 50.831 bln euros at end-March

* EDF reaffirms to cut debt by at least 5 bln euros by 2010

PARIS/MILAN, May 12 - EDF and Enel, two of Europe's biggest utility groups, said they were resisting in a difficult economic environment as they delivered first-quarter numbers that defied analyst predictions.

EDF, Europe's biggest power group by market capitalisation, posted a 15.1 percent sales rise to 21.1 billion euros ($28.76 billion), helped by higher tariffs, cold weather in January and February and the recent acquisition of British Energy.

Meanwhile, Enel's earnings before interest, taxes, depreciation and amortisation (EBITDA) rose 14.1 percent to 3.85 billion euros, despite a 1.5 percent dip in sales to 14.86 billion euros.

Both groups confirmed profitability for the year would remain good, and said they would forge ahead with asset disposals to reduce debt swelled by aggressive expansion moves.

"As of the end of March 2009, the group's overall performance resists well in a very difficult European economic context," EDF, the world's biggest single producer of nuclear power, said in a statement which provided only first-quarter revenue.

State-owned EDF reiterated full-year targets for moderate EBITDA growth, and a flat recurring net profit.

Enel said it expected deteriorated economic conditions to last the entire year but predicted that it would be able to maintain an "adequate level of profitability," making no detailed forecast.

Enel's chief financial officer, Luigi Ferraris, said first-quarter generation results had been good and April was likely to be similar, leading him to assume a generation EBITDA in line with last year.

"It's true the rate of our forward sales programme is slowing due to current economic conditions," he acknowledged. Enel has sold 100 percent of 2009 Italian power production at 80 euros per megawatt hour, well above spot prices, and has sold 47 percent of 2010 production at 84 euros per megawatt hour.

Chief Executive Fulvio Conti said the critical macroeconomic scenario could last the whole year, but added Enel "will be able to maintain a good level of profitability thanks to its geographical diversification ... and its generation margin hedging strategies."

DEBT ISSUES

Both Enel and EDF reiterated their commitments to sell assets to reduce debt piles with a view to maintaining credit ratings.

Enel, whose debt ballooned after its acquisition of Spanish utility Endesa, reaching 50.831 billion euros at the end of March, has pledged to make 10 billion euros of disposals by the end of 2010.

Management said the 8 billion capital increase recently approved by shareholders and cash flow will be enough to meet debt maturities of about 16 billion euros falling due in 2010.

Conti said Enel is close to completing the sale of a majority stake in a gas distribution grid, and should close the sale of a minority stake in renewables unit Enel Green Power, valued overall at around 11 billion to 12 billion euros, by year end.

EDF also reiterated its plans to dispose of assets to bolster its balance sheet after the recent acquisition of British Energy and half of Constellation Energy's nuclear business pushed its debt to nearly 25 billion euros.

"The group is committed to an asset disposal programme which, at the end of 2010, will have an impact on net financial debt of at least 5 billion, which will complement the net proceeds of the transaction with Centrica," EDF said.

On Monday, EDF announced it would sell 20 percent of its British Energy unit to British gas owner Centrica for 2.3 billion pounds ($3.49 billion).

EDF Chief Executive Pierre Gadonneix said the group was also in talks with other European utilities about forming future partnerships. He named Enel, GDF Suez and E.ON among the groups EDF was talking to.

Enel shares closed 2.8 percent higher at 4.33 euros in Milan, while EDF's added 0.4 percent to 34.54 euros at the Paris bourse. The stocks have lost 4.4 percent and nearly 17 percent, respectively, since the start of the year.