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UPDATE 1-Portugal EDP's profit drops 22% as pandemic hits power usage

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LISBON, Sept 3 (Reuters) - Portugal’s largest utility, EDP , on Thursday reported a 22% drop in first-half net profit to 315 million euros ($372 million) after the COVID-19 pandemic reduced energy consumption in Iberia and Brazil.

EDP said the drop in power usage in Portugal during the lockdown had also led the company to announce the closure of Sines coal plant in 2021, earlier than planned, “which implied the booking of a one-off cost of 130 million euros”.

Portugal’s economy contracted by a record 16.3% in the second quarter from a year earlier due to a six-week lockdown in March-May and other restrictions, some of which are still in force.

EDP, whose main shareholder is China Three Gorges, said in a statement its consolidated earnings before interest, taxes, depreciation and amortisation (EBITDA) contracted 3% to 1.87 billion euros.

The volume of electricity sold in Iberia fell by 7% whereas electricity consumption by clients in Brazil decreased by 9%.

EDP’s wind energy subsidiary EDP Renewables, reported earlier on Thursday a 26% fall in net profit to 255 million euros, with its revenues falling 9% to 913 million euros.

EDP said its recurring net profit still grew 8% to 509 million euros as wetter conditions compared with an extremely dry first half a year ago improved hydroelectricity revenue.

Consolidated net debt was stable at 14.1 billion euros, while capital expenditure increased 11% to 920 million euros.

Despite the pandemic, EDP has maintained its investment targets for the next three years and expects not to reduce dividends.

EDP shares had closed 0.34% higher at 4.374 euros before the results release, while EDPR fell 0.7% to 14.32 euros a share as the broader market in Lisbon ended 0.12% lower.

$1 = 0.8460 euros Reporting by Sergio Goncalves; editing by Andrei Khalip and Barbara Lewis