Redes Energeticas Nacionais Sa · EURONEXT:RENE
Redes Energeticas Nacionais Sa — REN - Redes Energéticas Nacionais, SGPS — Investor Presentation (July 2024)
43 slides from Redes Energeticas Nacionais Sa's investor presentation, July 2024
Slide 1: Corporate presentation
Corporate presentation July 2024 1
Slide 2: Key messages
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Key messages Exclusive TSO in Portugal Focused in Portugal with growth opportunities in Chile Operational excellence Highly efficient and reliable player, committed to in
Slide 3: Exclusive TSO in Portugal
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Exclusive TSO in Portugal Focused in Portugal with growth opportunities in Chile CORPORATE PRESENTATION 3
Slide 4: 70-year track record as a leading energy infrastructure operator focused in Portugal
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 70-year track record as a leading energy infrastructure operator focused in Portugal Foundation of CNE 2nd reprivatization phase 2nd reprivatization IPO of 4% of HCB (Nat
Slide 5: Exclusive TSO and largest gas DSO in Portugal, with international presence
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Exclusive TSO and largest gas DSO in Portugal, with international presence Portugal Chile Spain 9,467 km 92 km 1% stake 339M€ | EBITDA 16M€ | EBITDA Transmission 1,375 km
Slide 6: Portugal's electricity transmission and system management activity
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Portugal’s electricity transmission and system management activity Exclusive Transmission System Operator (TSO) 2,010 M€ AVERAGE RAB1 Transmission of very high voltage JU
Slide 7: The only player in Portugal's gas transmission activity
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 The only player in Portugal’s gas transmission activity Exclusive TSO (concession until 2046) 802 M€ Transportation of high-pressure natural AVERAGE RAB gas and overall t
Slide 8: Largest player in Portugal's gas distribution activity
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Largest player in Portugal’s gas distribution activity Largest gas distribution concession in Portugal among 11 companies with 494 M€ exclusive regional concessions AVERA
Slide 9: Telecommunications business carried through REN Telecom and strong IT infrastructures
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Telecommunications business carried through REN Telecom and strong IT infrastructures REN Telecom Public telecommunications network operator 8,106km since 2002 optical fi
Slide 10: Growing its international presence in the Chilean energy transmission business
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Growing its international presence in the Chilean energy transmission business Electrogas Transemel (42.5% stake since 2017) (100% since 2019) Operates a gas US$ 53M Stra
Slide 11: Operational excellence
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Operational excellence Highly efficient and reliable player, committed to innovation and technology CORPORATE PRESENTATION 11
Slide 12: Amongst the most efficient TSO's with superior service quality in international benchmarks
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Amongst the most efficient TSO’s with superior service quality in international benchmarks Electricity Natural Gas Transmission Service level in line with or outperformin
Slide 13: Enabling a renewable future
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Enabling a renewable future Closing of Portugal’s last remaining % Electricity consumption from renewable sources1 coal plant in November 2021 61% Renewable generation su
Slide 14: REN secured green transformation in Portugal
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 REN secured green transformation in Portugal Installed capacity of renewables REN kept a stable and reliable service 79% of total capacity 25 GW 1.2 Bn€ Domestic capex in
Slide 15: Leverage REN's DNA of innovation and energy transition
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Leverage REN’s DNA of innovation and energy transition Key projects in 2023 RESEARCH, DEVELOPMENT ▪ Pilot project on gas pipeline Quality and business monitoring with fib
Slide 16: Solid shareholder base with best-in-class corporate governance
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Solid shareholder base with best-in-class corporate governance Shareholder structure1 Board composition 25.0% Board diversity and 44.4% independence OTHER 46,7% Independe
Slide 17: REN remains committed to the highest ESG standards
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 REN remains committed to the highest ESG standards Environmental Social Governance Scope 1 and 2 emissions 2023: >1/3 of women in 1st line 33% COMMITMENTS -45% -60% ESG a
Slide 18: Good performance in international ESG scores but with ambition to do more
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Good performance in international ESG scores but with ambition to do more Latest Scale Score Strengths assessment Innovation, environmental reporting, 0-100 60 and social
Slide 19: REN deliver reliable and consistent value to all stakeholders
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 REN deliver reliable and consistent value to all stakeholders We are managing our environmental footprint >4,000 ha +1 M -45% replanted trees of indigenous scope 1 and 2
Slide 20: Stable business context
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Stable business context Stable regulatory context with long term contracts CORPORATE PRESENTATION 20
Slide 21: Fully regulated domestic business
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Fully regulated domestic business Regulatory framework Stable regulatory No consumer Allowed framework credit risk revenues ◼ 4-year regulatory periods, ◼ Tariff revenues
Slide 22: Introduction of TOTEX regulation in the electricity business
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Introduction of TOTEX regulation in the electricity business REN’s domestic allowed revenues breakdown Electricity 2022-251 Natural Gas 2024-27 Revenue Cap for + Efficien
Slide 23: Transparent and stable return mechanism
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Transparent and stable return mechanism RoR evolution, % RoR indexation mechanism Electricity (Tx) Natural gas (Tx) Electricity (base) Natural gas (Dx) At the ▪ Base RoR
Slide 24: Stable financial performance in domestic business
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Stable financial performance in domestic business Distribution Transmission EBITDA1 M€ 477 456 447 467 486 46 44 44 50 51 246 431 412 403 417 436 25 221 Average RAB1 M€ T
Slide 25: International gas transmission business very stable
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 International gas transmission business very stable Electrogas business has high EBITDA margins …with positive impact in REN’s results and low capex requirements… EBITDA
Slide 26: International electricity transmission business with attractive growth potential
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 International electricity transmission business with attractive growth potential EBITDA Revenues regularizations (one-off) M€ 16 11 7 8 9 4 Arica 3 6 8 12 Iquique Calama
Slide 27: Strong operational performance and stable asset base
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Strong operational performance and stable asset base New businesses allow for an overall asset base stabilization and sustainable operational results, despite mature dome
Slide 28: Solid results
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Solid results Strong financial discipline leading to attractive shareholder returns CORPORATE PRESENTATION 28
Slide 29: Stable net income
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Stable net income Despite some volatility in 10y Portuguese Government Bonds, REN has been able to maintain a stable net income Net income1 M€ 2.6 3.1 1.9 3.9 3.8 3.0 2.8
Slide 30: Balanced credit profile with investment grade credit metrics and lower cost of debt
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Balanced credit profile with investment grade credit metrics and lower cost of debt Gross debt maturity profile and funding Cost of debt evolution Rating agencies sources
Slide 31: Delivering compelling returns to shareholders
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Delivering compelling returns to shareholders Cumulative Total Shareholder Return1 since REN’s IPO Indexed from 100 180,00 PSI20 REN EuroStoxx Utilities 150,00 156.5% 120
Slide 32: Stable and attractive dividend per share
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Stable and attractive dividend per share REN Dividend per Share Dividend yield € June 2024, % 12.5 6.7 6.8 0.171 0.171 0.171 6.1 0.154 0.154 0.154 5.4 4.7 4.4 3.4 2.3 201
Slide 33: New strategic cycle 2024-27
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 New strategic cycle 2024-27 Enabling the Energy Transition, reinforcing our sustainability commitments and delivering sustainable profitable growth CORPORATE PRESENTATION
Slide 34: The Energy Transition is imperative with the energy sector to play a vital role
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 The Energy Transition is imperative with the energy sector to play a vital role The world is moving to tackle climate change The transition will not happen without grids
Slide 35: Strategic pillars: sustainability, Energy Transition, profitable growth
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Reinforcing our sustainability commitments Stepping-up ESG targets Fostering people excellence Enabling the Energy Transition Executing on the electricity transmission gr
Slide 36: Reinforcing our sustainability commitments
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Reinforcing our sustainability commitments Core commitments Path to achieve it By 2030… -60% -30% 2040 80% Electrified fleet Scope 1 + 2 Scope 3 -50% SF6 emissions (vs. 2
Slide 37: Stepping-up our investment
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Stepping-up our investment up to 70% over 2021-23 cycle Capex (M€/year) 1.5-1.7B€ Up to +50% Expansion of the electricity grid in to be invested Electricity 240-280 Moder
Slide 38: Connecting Portugal's ambitious portfolio of new renewable projects and unlocking green gases
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Connecting Portugal’s ambitious portfolio of new renewable projects and unlocking green gases 2024-27 investment plan for electricity grid expansion Gas infrastructure Te
Slide 39: Digitalization, innovation and the regulatory framework will be key in the new cycle
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Digitalization, innovation and the regulatory framework will be key in the new cycle We will leverage ▪ Digital tools to improve system operations Quality and business an
Slide 40: Firm commitment to strong fundamentals, fueled by significant investment growth
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Firm commitment to strong fundamentals, fueled by significant investment growth to enable the Energy Transition 2021-23 2024-27 Significant 350-450 investment Annual avg.
Slide 41: Solid credit metrics and attractive and sustainable dividend policy
1. EXCLUSIVE TSO IN PORTUGAL 2. OPERATIONAL EXCELLENCE 3. STABLE BUSINESS CONTEXT 4. SOLID RESULTS 5. NEW STRATEGIC CYCLE 2024-27 Solid credit metrics and attractive and sustainable dividend policy 2021-23 2024-27 Predictable, 0.154 0.163 Committed to increase sustainable and Dividend, the dividend
Slide 42: 6M24 Results
6M24 Results INDICATOR 6M23 6M24 6M23/24 EBITDA1 Results 264.9 257.8 -7.1 -2.7% Results Net financial income1 -16.7 -27.7 -11.0 -65.7% Net income 63.0 48.6 -14.4 -22.9% Recurrent net income 61.5 47.5 -13.9 -22.6% CAPEX2 111.8 135.4 23.6 21.1% Investment Transfers to RAB3 33.1 29.9 -3.2 -9.6% Avera
Slide 43: REN at a glance
REN at a glance1 FINANCIAL ELECTRICITY GAS 149.2 M€ 44.8 TWh 55.6 TWh NET INCOME ENERGY TRANSMITED TRANSPORTED ENERGY 301.5 M€ 50.7 TWh 49.0 TWh INVESTMENT CONSUMPTION CONSUMPTION 3,547.8 M€ 0.39 min 95% AVERAGE RAB INTERRUPTION TIME2 LNG TERMINAL COMMUNITIES HUMAN CAPITAL NATURAL CAPITAL 670 k€ 748
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