The Diplomat in Spain

The Diplomat

Iberdrola obtained a net profit of 2,760 million euros in the first quarter of the year, which represents an increase of 85.8% compared to the 1,485 million euros in the same period of 2023, driven by the million-dollar capital gains recorded with the sale of assets in Mexico, according to the company.

Specifically, the asset sale operation in Mexico, closed on February 26, represented an extraordinary contribution of 1,165 million euros to its net profit, while in 2023 it had a positive impact of 238 million euros due to its recovery from the deficit. in the UK trading business. Excluding these recurring items, the energy company’s net profit grew by 28%.

For its part, the gross operating result (Ebitda) stood at 5,857 million euros at the end of March, 44.1% more than in the same period last year. Excluding the capital gain from Mexico and the recovery of the tariff deficit in the United Kingdom, Ebitda grows by 10%, to 4,140 million euros, due to the improvement in margins and the record achieved in renewable production in the last 10 years in Iberia, highlights Europa Press.

The group’s turnover in the period from January to March reached 12,678.5 million euros, which represents a drop of 18% compared to the first quarter of 2023.

These electricity company figures were boosted by gross investments that in the quarter reached 2,382 million euros, 36% more, with a growth in the network business of 27%, up to 1,213 million euros due, mainly , to the new ‘rate cases’ in the United States, the United Kingdom and Brazil, distributing the investment 60% in distribution and 40% in transmission.

For its part, investment in the Renewable business increased by more than 50%, to 994 million euros, of which 366 million euros were directed to offshore wind (+70%).

Throughout the year the company will continue to advance its offshore wind strategy with the entry into service of three projects: St. Brieuc, (500 MW, France); Vineyard Wind 1 (800 MW, USA) and Baltic Eagle (475 MW, Germany). In addition, the company will have a greater resource from manageable renewables.

The energy company closed the first quarter with an installed renewable capacity of 42,300 MW worldwide. Iberdrola generates 100% emission-free energy in the United Kingdom, Brazil, France, Italy, Germany, Poland, Portugal, Greece, Romania and Bulgaria. Emission-free production reached 92% of the total in Spain in this first quarter.

Of the total investments, 35% were destined for the United States, 20% for the United Kingdom, another 20% for Spain, 15% for Latin America and the remaining 10% for Continental Europe and Australia.

The president of the energy company, Ignacio Sánchez Galán, highlighted that these results “show the solidity of Iberdrola’s model and the positive impact of the investments included in the 2024-2026 Plan.”

“The good evolution of our businesses in the first quarter, together with the growth of investments already underway, also allow us to improve our forecasts for the whole of 2024,” he said.

Thus, Iberdrola once again increases its profit estimates for the year as a whole, reaching net profit growth in the high single digits (excluding any capital gains from asset rotations), thanks to the strong operating performance, the contribution of investments -12 billion euros for this year – and the contribution of the new regulatory frameworks in the network business in the United States, the United Kingdom and Brazil.

In this way, the energy company, which in 2023 already obtained historic profits of 4,803 million euros, aims for a new record profit of more than 5,000 million euros in 2024.

In the period from January to March, Iberdrola also recorded a significant improvement in cash generation, with the cash inflow in the first quarter of approximately 5.4 billion euros from the Mexico transaction.

The operating cash flow (FFO) reported by the company grew by 5%, to 3,145 million euros, and 14% if the impact of the United Kingdom tariff deficit registered in the first quarter of 2023 is excluded.

In addition, it has liquidity of 22.4 billion euros, which would allow it to cover 26 months of financial needs without resorting to the market.

Meanwhile, Iberdrola’s adjusted net financial debt at the end of March stands at 44,998 million euros, decreasing by 5.9% compared to December 2023 thanks to the collection from the sale of Mexico.