Iberdrola Sa · BME:IBE
Iberdrola Sa — H1 2022 Earnings Presentation
40 slides from Iberdrola Sa's earnings presentation, Jul 27, 2022
Slide 1: Results Presentation First Half 2022
RESULTS PRESENTATION July 27, 2022 FIRST HALF
Slide 2: Legal Notice: Disclaimer
RESULTS PRESENTATION FIRST HALF 2022 Legal Notice ▪ DISCLAIMER ▪ This document has been prepared by Iberdrola, S.A. exclusively for use during the presentation of financial results ▪ This document and the information presented herein was prepared by Iberdrola, S.A. solely with respect to the of the
Slide 3: Legal Notice: Forward-Looking Statements
RESULTS PRESENTATION FIRST HALF 2022 Legal Notice ▪ FORWARD-LOOKING STATEMENTS ▪ This communication contains forward-looking information and statements about Iberdrola, S.A., including financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and ex
Slide 4: Highlights of the period
Highlights of the period RESULTS PRESENTATION FIRST HALF 2022 | www.iberdrola.com |4
Slide 5: Highlights of the period
RESULTS PRESENTATION FIRST HALF 2022 Highlights of the period NET PROFIT UP 36% TO EUR 2,075 M DESPITE 26% DECREASE IN SPAIN EBITDA increases 18% to EUR 6,444 M growing in all the geographies except in Spain Operating cash flow reaches EUR 5,560 M, up 31% Gross investments of EUR 4,741 M (+5%) for a
Slide 6: EBITDA increases 18% to EUR 6,444 M
RESULTS PRESENTATION FIRST HALF 2022 EBITDA EBITDA INCREASES +18% TO EUR 6,444 M… NETWORKS BREAKDOWN BY BUSINESS • Higher asset base in all geographies • Tariff increases in USA and Brazil • Regulatory frameworks protecting from higher inflation • New York order allowing to accrue certain regulatory
Slide 7: Iberdrola Spain
RESULTS PRESENTATION FIRST HALF 2022 Iberdrola Spain …D … WRI TI V HETNH B E YE A X CCEHPATLI O LEN NOGFI NSGP A CIONN, TDERXI T V…EN BY A COMPLEX CONTEXT IN THE FIRST SIX MONTHS OF THE YEAR ~ 5% reduction in electricity production: • -17% renewable and nuclear output: lower resource and nuclear out
Slide 8: Investments
RESULTS PRESENTATION FIRST HALF 2022 Investments GROSS INVESTMENTS OF EUR 4,741 M (+5%) FOR A TOTAL OF EUR ~10,200 M IN THE LAST 12 MONTHS… H1 2022 GROSS INVESTMENTS BY COUNTRY H1 2022 GROSS INVESTMENTS BY BUSINESS EUR M Weight Corporate & other Other Energy Production USA 1,246 26% & Customers 2% S
Slide 9: Renewable capacity
RESULTS PRESENTATION FIRST HALF 2022 Renewable capacity ~3 , 4 0 0 N E W M W I N O P E R A T I O N I N T H E L A S T 1 2 M O N T H S … NEW INSTALLED CAPACITY BY TECHNOLOGY (Y-o-Y) CAPACITY UNDER CONSTRUCTION OR SECURED BY GEOGRAPHY Peso 3% 116 MW USA 50 2,825 625 -- -- 3,500 32% 37% 1,241 MW Iberia
Slide 10: Acceleration of growth: Renewables
RESULTS PRESENTATION FIRST HALF 2022 Acceleration of growth: Renewables SECURING ADDITIONAL INVESTMENT OPORTUNITIES IN RENEWABLES… CFD ALLOCATION ROUND 4 WINNERS AWARDED WITH 2,094 MW Offshore Onshore Solar wind wind PV East Anglia 3 1,372 MW 396 MW 326 MW ► In operation: 2023 - 2027 ► Spread over W
Slide 11: Acceleration of growth: Networks
RESULTS PRESENTATION FIRST HALF 2022 Acceleration of growth : Networks …AND IN POWER NETWORKS ► Remuneration: Cost of Equity 4,75% (plus inflation, post-tax) + incentives RIIO – ED2 ► Authorized TOTEX GBP ~ 3,400 M Draft Determination ► Allowed leverage: 60% ► Period: 2023-2028 ADDITONAL TO RIIO-T2
Slide 12: Increasing opportunities in transmission
RESULTS PRESENTATION FIRST HALF 2022 Acceleration of growth: Networks INCREASING OPPORTUNITIES IN TRANSMISSION Transmission ► NEOENERGIA awarded with 1,966 Km of HV lines Auction nº 01/2022 ► ~90% of procurements contracts already closed or hedged Total Auctions ► Total of 8,000 km of HV lines and 1
Slide 13: Energy policy and regulatory updates
RESULTS PRESENTATION FIRST HALF 2022 Energy policy and regulatory updates EU SPAIN ▪ Agreement to reduce gas consumption ▪ Subsidy to gas used for electricity production to be financed by customers in regulated tariffs and liberalized consumers ▪ Green Taxonomy: inclusion gas (under certain conditio
Slide 14: Avangrid and Neoenergia Results
RESULTS PRESENTATION FIRST HALF 2022 Avangrid and Neoenergia Results STRONG PERFORMANCE OF AVANGRID AND NEOENERGIA, PROVING THE ADVANTAGES OF OUR GEOGRAPHIC DIVERSIFICATION AVANGRID’S NET PROFIT GROWS +46% NEOENERGIA’S NET PROFIT GROWS +14% TO USD 629 M TO BRL 2,287 M Adjusted EBITDA USD 1,208 M1 EB
Slide 15: Balanced business and financial profile
RESULTS PRESENTATION FIRST HALF 2022 Balanced business and financial profile IBERDROLA’S RESILIENT BUSINESS MODEL… Sustainable model based on renewables, networks and energy storage ~90% of European production comes from zero-emission sources BUSINESS Gas contributing only 4% of EBITDA in Europe No
Slide 16: Shareholder remuneration
RESULTS PRESENTATION FIRST HALF 2022 Shareholder remuneration INCREASING ANNUAL SHAREHOLDER REMUNERATION… Interim dividend of EUR 0.170 per share paid on February 1th 2022 Supplementary dividend of EUR 0.274 per share (or 1 new share per 36 rights) to be paid on 2nd August Engagement dividend of EUR
Slide 17: Analysis of the results
Analysis of the results RESULTS PRESENTATION FIRST HALF 2022 | www.iberdrola.com | 17
Slide 18: Income Statement
RESULTS PRESENTATION FIRST HALF 2022 Income Statement EBITDA up 18%, to EUR 6,444 M. Net Profit reaches EUR 2,075 M EUR M H1 2022 H1 2021 % Revenues 24,430 18,752 +30.3 Gross Margin 9,869 8,506 +16.0 Net Operating Expenses -2,492 -2,120 +17.6 Levies -933 -943 -1.0 EBITDA 6,444 5,444 +18.4 EBIT 3,922
Slide 19: Gross Margin
RESULTS PRESENTATION FIRST HALF 2022 Gross Margin Gross Margin up 16%, to EUR 9,869 M, and 9% excluding FX impact REVENUES (EUR M) PROCUREMENTS (EUR M) 24,430.0 +30.3% 18,752.2 +42.1% 14,561.1 10,246.2 H1 2021 H1 2022 H1 2021 H1 2022 Revenues up 30%, to EUR 24,430 M, and Procurements up 42%, to EUR
Slide 20: Net Operating Expenses
RESULTS PRESENTATION FIRST HALF 2022 Net Operating Expenses Net Operating Expenses up 18%, to EUR 2,492 M, and 10% excluding FX, as a consequence of growth,… Net Operating Expenses (EUR M) H1 2022 H1 2021 vs H1’21 (%) Net Personnel Expenses -1,211.3 -1,108.9 +9.2% External Services -1,663.0 -1,411.8
Slide 21: Results by Business / Networks
RESULTS PRESENTATION FIRST HALF 2022 Results by Business / Networks Networks EBITDA grows 32%, to EUR 3,376 M 19% Spain Brazil 31% 3,375.8 16% United Kingdom United States 34% www.iberdrola.com | 21
Slide 22: Results by Business / Networks
RESULTS PRESENTATION FIRST HALF 2022 Results by Business / Networks EBITDA EUR 632.4 M (-24.4%): SPAIN • EUR -195 M negative one-off related to a legal case. • EUR -22 M as a consequence of positive settlements accounted for in 2021. EBITDA BRL 5,804.7 M (+33.4%): BRAZIL • Positive impacts in Distri
Slide 23: Results by Business / Energy Production and Customers
RESULTS PRESENTATION FIRST HALF 2022 Results by Business / Energy Production and Customers Energy Production and Customers EBITDA up 9%, to EUR 3,054 M RoW 7% Mexico 14% Brazil 5% 3,054.1 46% Spain United States 10% 17% United Kingdom www.iberdrola.com | 23
Slide 24: Results by Business / Energy Production and Customers
RESULTS PRESENTATION FIRST HALF 2022 Results by Business / Energy Production and Customers SPAIN EBITDA EUR 1,411.4 M (+6.6%): • Despite high price environment, as a consequence of Group’s fixed price sales. EBITDA USD 350.6 M (-21.8%): UNITED • Positive impact of Texas cold snap accounted for in Q1
Slide 25: Results by Business / Energy Production and Customers
RESULTS PRESENTATION FIRST HALF 2022 Results by Business / Energy Production and Customers EBITDA USD 466.9 M (+11.6%): MEXICO • Positive impact from Texas cold snap losses in Q1 2021. • Partially offset by lower thermal production. EBITDA BRL 936.5 M (+55.8%): BRAZIL • Mainly driven by Termope CCGT
Slide 26: EBIT
RESULTS PRESENTATION FIRST HALF 2022 EBIT EBIT grows 21%, to EUR 3,922 M EBIT (EUR M) D&A and Provisions (EUR M) 3,922.3 +21.0% +14.5% (+8.6 ex FX) -2,522 3,241.5 -2,202 -280 -203 Provisions -2,242 -1,999 D&A H1 2021 H1 2022 H1 2021 H1 2022 D&A and Provisions up 14.5%, to EUR 2,522 M, and +8.6% excl
Slide 27: Net Financial Results
RESULTS PRESENTATION FIRST HALF 2022 Net Financial Results Net Financial Results up EUR 444 M, to EUR 916 M, due to euro depreciation affecting debt and derivatives, higher average debt and higher cost of debt, mainly in BRL… NET FINANCIAL RESULT (EUR M) COST OF DEBT -153 -916 -4 bps (ex NEO) 2.90%
Slide 28: Debt structure
RESULTS PRESENTATION FIRST HALF 2022 Debt structure Iberdrola Balance Sheet is well positioned against rising interest rates DEBT SPLIT * FIXED % RANGE Other Debt ** EBITDA *** R 2% 86% ~ 55% 16% 93% ~ 90% 38% 15% 91% ~ 55% 88% ~ 62% 29% R 0% ~ 0% * Calculated over net debt ** Calculated over net de
Slide 29: Liquidity and maturities
RESULTS PRESENTATION FIRST HALF 2022 Liquidity and maturities Up to date, our liquidity totals EUR 25* bn covering 27 months* of financing needs … 21,297 Cash 4,052 Backup Available lines financing 9,800 4,846 5,339 5,566 Credit lines 4,388 6,265 4,063 2,887 2022 2023 2024** 2025 2026 2027+ … with a
Slide 30: Net Debt evolution
RESULTS PRESENTATION FIRST HALF 2022 Net Debt evolution Cash flow generation, up 31%,… 1,863 597 41,717 39,119 5,560 957 4,741 Other Dividend1 FX Gross FFO Investments Net debt Net debt Dec 2021 Jun 2022 …compensates gross investments and FX 1. Includes scrip dividend + cash www.iberdrola.com | 30
Slide 31: Financial ratios and Adjusted Net Debt
RESULTS PRESENTATION FIRST HALF 2022 Financial ratios and Adjusted Net Debt Iberdrola maintains a solid financial position… ADJUSTED CREDIT METRICS ADJUSTED NET DEBT1 (EUR M) 41,717 Jun 20211 Jun 2022 39,119 1,863* Adjusted Net Debt / EBITDA 3.4x 3.2x FFO 2 / Adjusted Net Debt 23.6% 24.7% RCF / Adju
Slide 32: Net Profit
RESULTS PRESENTATION FIRST HALF 2022 Net Profit Net Profit reaches EUR 2,075 M, driven by operating performance and one-offs’ net positive effect EUR M H1 2022 H1 2021 vs H1’21 (%) EBIT 3,922.3 3,241.5 +21.0% - Net Financial Expenses -916.0 -471.7 +94.2% - Equity Method 161.0 -1.9 n/a - Corporate Ta
Slide 33: Conclusions
Conclusions RESULTS PRESENTATION FIRST HALF 2022 | www.iberdrola.com | 33
Slide 34: Conclusion: 2022 Outlook
RESULTS PRESENTATION FIRST HALF 2022 Conclusion: 2022 Outlook EUR ~4,500 Bn Output ~3,000 MW of additional normalization of additional network in second half capacity investments Debt structure Positive FX impact protecting from in Operating Result increases in interest rates REAFFIRMING OUR NET PRO
Slide 35: Upcoming Capital Markets Day in November 2022
RESULTS PRESENTATION FIRST HALF 2022 CAPITAL MARKETS DAY UPCOMING CAPITAL MARKETS DAY IN NOVEMBER 2022… …WITH MORE INFORMATION ABOUT GROUP’S PROJECTIONS FOR THE NEXT YEARS www.iberdrola.com | 35
Slide 36: Annex
Annex RESULTS PRESENTATION FIRST HALF 2022 | www.iberdrola.com | 36
Slide 37: Financing transactions in Q2
RESULTS PRESENTATION FIRST HALF 2022 Financing transactions in Q2 Iberdrola has been able to close transactions totaling over EUR 5 bn in all markets with favorable conditions in an adverse scenario, anticipating H2 financing NEW FINANCING Q2: EUR 5,464 M* MAIN TRANSACTIONS Bank market: EUR 3,389 M
Slide 38: ESG financing
RESULTS PRESENTATION FIRST HALF 2022 ESG financing In 2022 Iberdrola signed EUR 6.5* bn of new ESG financing for a cumulative total of EUR 43.8* bn up-to-date NEW ESG FINANCING 2022: EUR 6,518 M * TOTAL ESG FINANCING: EUR 43,807 M * 77% of newly signed financing are ESG transactions, reaffirming Ibe
Slide 39: ESG-F
RESULTS PRESENTATION FIRST HALF 2022 ESG-F Iberdrola monitors the most relevant sustainability indicators in its business strategy and establishes parameters related to ESG criteria in its incentive plans ∆ Annual average 2020 2021 2017-2021 Own emission-free installed capacity (%) 79 81 +2.3% Own s
Slide 40: ESG-F
RESULTS PRESENTATION FIRST HALF 2022 ESG-F Iberdrola, a pioneer in its approach to corporate governance and leader in governance vision from an ESG perspective, according to PWC E S G Leading the energy transition Gender diversity Governance and Sustainability for more than two decades Top 21 in IBE