French energy company ENGIE saw a 16% drop in profits in the first half of this year as warmer-than-usual winter weather reduced gas demand for home heating in Europe.

ENGIE, which generates most of its income from producing, transporting, and selling gas and electricity, reported that earnings before interest and taxes, excluding nuclear energy, totaled 5.6 billion euros, a 16.3% year-on-year decline.

ENGIE is among the first major European utility companies to announce its results for the first six months of the year. The sector is grappling with weak demand for electricity and gas in the region while investing heavily in renewable energy sources like solar, wind, batteries, and biomethane in an effort to move away from fossil fuels.

Despite the downturn, ENGIE raised its full-year profit forecast, citing strong performance in power generation during the first half and lower-than-expected financial costs.

The company now expects net income this year to be between 5 billion and 5.6 billion euros, an 800 million euro increase from previous forecasts. Net income fell by 6.9% to 3.8 billion euros in the first half, as ENGIE added over 1 gigawatt of renewable energy capacity.