By Liam Moloney
ROME--The unprecedented economic slump hitting Europe means that
electricity and natural gas demand in Enel SpA's (ENEL.MI) key
markets in Italy and Spain isn't expected to return to pre-crisis
levels before 2017, the company's chief executive said Tuesday.
"The crisis that has hit Europe is an unprecedented phenomenon,"
with a pickup in activity still far off, said Fulvio Conti at
Enel's shareholders' meeting in Rome to approve 2012 results, where
he confirmed the company's targets.
The economy of the 17 countries that use the euro shrank for
five consecutive quarters up to the end of 2012, matching in
length--but not severity--the recession that followed the collapse
of U.S. investment bank Lehman Brothers in 2008. Official figures
on the bloc's output in the first quarter of 2013, due to be
published in mid-May, are widely expected to show another three
months of contraction, putting the euro zone in its longest
recession since its creation in 1999. Tuesday, the euro zone's
unemployment rate rose to a fresh high in March. A recession is
typically defined as two consecutive quarters of falling
output.
Mr. Conti rounded on the Italian government's tax on the energy
sector, which Rome hopes to use to raise public funds, saying the
so-called Robin Hood tax is equivalent to a reduction of about 200
million euros ($260 million) in net profit a year from 2014.
He also criticized the administration in Madrid for similar
policies.
"The Spanish government continues to consider the power sector
as a source from which to fund the state budget," said Mr. Conti,
referring to its second-biggest market, where Enel controls Endesa
SA (ELE.MC).
Mr. Conti confirmed Enel's target of reducing net debt to EUR37
billion at the of 2014 from EUR42.9 billion in December, and
earnings before interest, taxes, depreciation and amortization of
about EUR16 billion this year and in 2015.
Write to Liam Moloney at liam.moloney@dowjones.com
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