La Française de l’Énergie: -€3.8M on Unwound Hedges, a Mark-to-Market of -€6.7M
La Française de l’Énergie announced an estimated impact of -€3.8M on its results and cash flow due to unwound hedging transactions as of June 30, 2026. Concurrently, the still-open positions had an estimated mark-to-market of -€6.7M at this date, which could change depending on market conditions. After identifying failures in the execution of certain operations and in associated controls, the group has reduced the concerned positions and initiated a strengthening of its risk management framework.
Failures in Execution and Control of Hedges
In its gas and electricity sales, FDE is exposed to energy price fluctuations. For electricity, this exposure pertains to the portion of sales not covered by a purchase obligation contract, which is 50% of its French portfolio. For several years, the group has primarily hedged this exposure using financial swaps that fix future gas and electricity sales prices. According to FDE, the exceptional and unpredictable volatility observed in recent months has significantly impacted the valuation of these instruments. The group has identified failures in the execution of certain hedging operations and in the associated control mechanisms. The concerned positions were immediately identified and reduced.
An Estimated Impact of -€3.8M and a Mark-to-Market of -€6.7M
The unwound transactions as of June 30, 2026 resulted in an estimated impact of -€3.8M on the group's income statement and cash flow. On the same date, the still-open positions exhibited an estimated mark-to-market of -€6.7M. This valuation is not final: it is subject to fair value adjustments and will depend on market conditions until the positions mature. FDE notes that these estimates are preliminary, unaudited, and may be adjusted upon finalization of the accounts and the work of the auditors. The group will communicate the definitive financial impact when it publishes its annual results.
Internal Control Strengthened, Strategic Trajectory Maintained
FDE has initiated an action plan that includes reviewing and reducing the concerned exposures, implementing triple validation for each transaction, revising delegations and risk limits, deploying a real-time Value at Risk tool, and strengthening internal reporting. The hedging policy aimed at limiting exposure to physical delivery capacities remains unchanged, but the control of its execution is immediately strengthened. FDE asserts that these potential losses do not currently affect its operations and development, and indicates that it has the necessary financial resources to meet all its commitments. The group maintains its medium-term strategic objectives and specifies that its projects for electricity production in northern France, renewable natural gas in Norway, and natural hydrogen in eastern France are proceeding according to the planned schedule.
