Investments of EUR 10.4 billion boost Iberdrola's net profit to EUR 1.485 billion
Iberdrola continues to make steady progress on its 2023-2025 Strategic Plan to lead the energy transition and reduce dependence on fossil fuels. The company has made investments of 10.4 billion euros in the last 12 months, 9% more than in the same period last year. 91% of the investment was in renewables - EUR 4.6 billion, of which 30% was in offshore wind - and smart grids - EUR 4.8 billion - to accelerate electrification and promote energy autonomy.
The investment figure, together with a normalisation of production in the first quarter of 2023, has enabled renewable generation to increase by 11% in the period and reduce energy purchases made last year at high prices. As a result, the company now has 40,344 MW of renewable energy worldwide. Iberdrola is also consolidating its position in offshore wind, with 3,500 MW under construction - of which 1,800 MW will come into operation in France, the United States and Germany -, with contracts already signed with suppliers and energy sold for 15 years or more. Iberdrola's Chairman, Ignacio Galán, said: "Investments of 10.4 billion euros and the normalisation of operating conditions have enabled us to drive growth and continue to add value to the companies in all the countries we serve". The company reported gross operating profit (Ebitda) of €4,064 million in the first quarter, driven by the recovery of accumulated trade deficits in the UK, the improvement in the EU and new investments. Overall net profit was 1,485 million euros, as reported to the Spanish National Securities Market Commission (CNMV). "The need for greater electrification with renewables, grids and storage to advance decarbonisation and energy autonomy is already being recognised by energy policy and regulation in our main markets, in line with the strategy we have been developing for more than 20 years", said Iberdrola's chairman.
This quarter has been marked by new alliances and asset rotation to boost electrification with clean energy. In recent weeks, the company closed an amicable agreement to sell 60% of its Mexican business for 6,000 million dollars (approximately 5,500 million euros). With this transaction, the company continues to be the leading private generator of renewable energy in Mexico and is driving the fulfilment of its decarbonisation commitments with the growth in renewables. The company maintains 15 power plants, focusing on its clean energy business and its industrial customer base.
This operation also includes the new vehicle with the sovereign wealth fund of Singapore (GIC) to co-invest in the transmission grid business in Brazil and the agreement with Norges for new renewable projects with a capacity of 1,300 MW.
In the last three months, the company has once again strengthened its balance sheet with more than 1.3 billion euros of financing, with favourable conditions. Thus, the group has once again demonstrated its leadership in green and sustainable financing, reaching a total of 48,623 million euros.
In addition, it has liquidity of almost 21 billion euros, which would allow it to cover 22 months of financing needs without resorting to the market. In an inflationary context, 74% of the debt is at a fixed rate, with an average maturity of more than six years.
The company's operating cash flow reached EUR 3 billion in the last three months, improving the ratio of cash generation to net debt by 1.3 percentage points to 25.3%.
Thanks to organic investments of EUR 12 billion this year and a continued improvement in operating conditions, the company expects net profit growth in the high mid-single digits, excluding additional one-offs.
Invertimos 1⃣0⃣.4⃣0⃣0⃣ millones € en impulsar el crecimiento para seguir aportando valor a la sociedad
— Iberdrola (@iberdrola) April 26, 2023
Líderes globales en #renovables?, con más de 40.000 MW instalados
Comprometidos con la #TransiciónEnergética hacia un futuro mejor para TODOS ?https://t.co/hBGsyBvMXX
Against this backdrop, Iberdrola continues to make steady progress on its 2023-2025 strategic plan. In fact, 60% of the new capacity for 2025 is already operational or under construction and 100% of network investment is covered by closed frameworks or under negotiation.
In addition, thanks to the last two agreements closed in this quarter, the company has reached in three months the financial objective of 7,500 million euros set in the Strategic Alliances Plan and the rotation of assets for 2025. In addition, the energy group has 95% of its production sold in different terms - short, medium and long term - with PPAs or bilateral contracts.
Iberdrola has continued to contribute to creating value in all areas of society. On the one hand, by protecting the planet with investments aimed at the circular economy, such as the wind turbine blade recycling factory or the lithium battery recycling plant, which allows us to be closer to zero emissions by 2030. On the other hand, the company is committed to the regions where it is located, developing industrial projects for solar and innovation components, related to the Next Generation EU Funds, such as the green hydrogen project or the development of methanol, green ammonia or aerothermal energy. All this is complemented by the best corporate governance standards, endorsed by the main voting advisors, who recommend voting in favour of all the items on the agenda of the next General Shareholders' Meeting, to be held on Friday 28 April.
