Slide 1: Results Presentation Nine Months 2023
Results Presentation Nine Months 26 October, 2023
Slide 2: Legal Notice: Disclaimer
Results Presentation Legal Notice Nine Months 2023 DISCLAIMER This document has been prepared by Iberdrola, S.A. exclusively for use during the presentation of financial results of the nine-month period ended on 30 September 2023. As a consequence thereof, this document may not be disclosed or publi
Slide 3: Legal Notice: Forward-Looking Statements
Results Presentation Legal Notice Nine Months 2023 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 expec
Slide 4: Highlights of the period
Results Presentation Nine Months 2023 Highlights of the period www.iberdrola.com | 4
Slide 5: Highlights of the period
Results Highlights of the period Presentation Nine Months 2023 NET PROFIT UP +17% TO EUR 3,637 M (+22% excluding non-cash exceptional item)… Strong operating Strong performance operating performance Investments progressing Financial strength EBITDA +13% to Eur 10,783 M Eur 10,842 M in last 12m Incre
Slide 6: Key Pillars CMD '22
Results Highlights of the period Presentation Nine Months 2023 STRENGTHENING GROWTH & PROFITABILITY AND DE-RISKING ASSET BASE… Key Pillars CMD ‘22 RISING INFLATION GROWTH IN NETWORKS RISING INTEREST RATES SELECTIVE INVESTMENT IN RENEWABLES COMMODITY PRICE VOLATILITY HIGH-RATING COUNTRIES FINANCIAL S
Slide 7: EBITDA increases 13% to EUR 10,783 M
Results EBITDA Presentation Nine Months 2023 EBITDA INCREASES +13% TO EUR 10,783 M… EBITDA evolution NETWORKS Eur • Annual tariff adjustments 10,783 M • Regulatory frameworks protecting from higher inflation in the Eur +13% 9,529 M UK, Brazil and the US • Improving efficiency and grid resiliency ENE
Slide 8: Strategic Plan Execution: Growth in networks
Results Strategic Plan Execution: Growth in networks Presentation Nine Months 2023 GROWTH IN ALL GEOGRAPHIES DRIVEN BY STABLE AND PREDICTABLE FRAMEWORKS protecting from inflation and interest rates RAB by Geography (y-o-y) 96% of 2025 Regulated asset base with frameworks closed Eur Distribution 41.3
Slide 9: Strategic Plan Execution: Onshore renewables
Results Strategic Plan Execution: Onshore renewables Presentation Nine Months 2023 SELECTIVE GROWTH IN RENEWABLES TO BALANCE OUR GENERATION / SUPPLY POSITION ONSHORE RENEWABLE CAPACITY BY STAGE ➢ High-rating countries 4.4 GW 7.1 GW ➢ Optimizing current onshore asset base of 40 GW Already ~60% of ons
Slide 10: Strategic Plan Execution: Offshore wind
Results Strategic Plan Execution: Offshore wind Presentation Nine Months 2023 OFFSHORE WIND GROWTH SECURED: DOUBLING EBITDA CONTRIBUTION BY ‘25/26… OFFSHORE WIND CAPACITY EBITDA2 CONTRIBUTION EUR Windanker EA3 300 MW +400 M 1,400 MW 5 PROJECTS p.a. EUR EUR PPA 4.8 UNDER CONSTRUCTION 1.9 Bn 15yrs +80
Slide 11: Offshore wind: mature pipeline at competitive costs
Results Strategic Plan Execution: Offshore wind Presentation Nine Months 2023 …WITH A MATURE PIPELINE AT COMPETITIVE COSTS THAT PROVIDES OPTIONALITY FOR FURTHER GROWTH PROJECTS WITH CONSENT Mature projects with average development costs of €~60/kW Park City Wind 800 MW vs €~600/kW in recent auctions
Slide 12: Strategic Plan Execution: Pumped Hydro
Results Strategic Plan Execution: Pumped Hydro Presentation Nine Months 2023 INCREASING ROLE OF STORAGE TO MODULATE SUPPLY AND DEMAND IN SHORT AND LONG CYCLES… BUSINESS CASE FOR PUMP HYDRO: ABILITY TO BENEFIT FROM LONG DURATION CYCLES (DAILY/WEEKLY) vs 2/4 HOURS FROM BATTERIES FUTURE DAILY CYCLE FUT
Slide 13: Pumped hydro asset base and pipeline
Results Strategic Plan Execution: Pumped Hydro Presentation Nine Months 2023 IBERDROLA HAS MORE THAN 100 M kWh OF PUMP STORAGE CAPACITY AND A PIPELINE FOR SIGNIFICANT EXPANSION IN COMING YEARS… IBERDROLA CURRENT PUMPED HYDRO ASSET BASE AND PIPELINE IN IBERIA Villarino – 24 M kWh La Muela - 24 M kWh
Slide 14: Strategic Plan Execution: Routes to Market
Results Strategic Plan Execution: Routes to Market Presentation Nine Months 2023 AROUND 90% OF 2023-25 PLANNED ENERGY ALREADY SOLD Volumes sold 2023-25 DIVERSIFIED APPROACH TO SECURE ENERGY BALANCE ~10% ~20% LT Contracts & PPAs 100% ~90% • Long-term revenues secured through ~80% PPAs and CFDs • Prov
Slide 15: Strategic Plan Execution: Supply Chain
Results Strategic Plan Execution: Supply Chain Presentation Nine Months 2023 ~100% RENEWABLES AND ~85% NETWORKS SUPPLY CHAIN SECURED FOR 2023-25 ▶ 100% of supply chain to 2025 secured Offshore Wind ▶ Projects 2023-25 : St. Brieuc, Baltic Eagle and Vineyard Wind ▶ Secured Projects >2025 : East Anglia
Slide 16: Asset rotation & Partnerships
Results Strategic Plan Execution: Asset rotation & Partnerships Presentation Nine Months 2023 ASSET ROTATION PLAN 2023-2025 ALREADY COMPLETED (EUR 7,500 M) ✓ INCREASING FLEXIBILITY Transaction overview Asset Partnership Rotation • Access to more projects and investments Mexico Transaction Strategic
Slide 17: Asset rotation & Partnerships: transactions progressing
Results Strategic Plan Execution: Asset rotation & Partnerships Presentation Nine Months 2023 TRANSACTIONS PROGRESSING AS SCHEDULED AND ANALYZING POTENTIAL ADDITIONAL OPPORTUNITIES Latest developments Mexico: in progress to close before year-end Strategic Alliance with Norges in Spain and Portugal ✓
Slide 18: Improving cash flow & financial solidity
Results Strategic Plan Execution: Improving cash flow & financial solidity Presentation Nine Months 2023 … WHICH ALONG WITH STRONG OPERATING CASH FLOW OF EUR 11 BN IN 12 MONTHS… OPERATING CASH FLOW – FFO1 (EUR M) NET DEBT (EUR BN) 11,103 43 42-43 826 +11% Hydro canon FFO/Adj. Net Debt 9,952 23.2% Se
Slide 19: Shareholder Remuneration
Results Strategic Plan Execution: Shareholder Remuneration Presentation Nine Months 2023 2023 INTERIM SHAREHOLDER REMUNERATION OF EUR 0.20/SHARE (+11%) Eur 0.501/Share (already above 2025 floor) To be determined Supplementary & Eur by engagement 0.321 GSM1 dividend Interim Eur +11% Eur dividend 0.18
Slide 20: Electricity Market Reform
Results Electricity Market Reform Presentation Nine Months 2023 ELECTRICITY MARKET REFORM: EU COUNCIL AGREEMENT CLOSED, IN LINE WITH THE POSITIVE OUTCOME OF COMMISSION AND PARLIAMENT PROPOSALS EU Commission EU Parliament EU Council Proposal Approval Agreement ► Recognition of adequate market functio
Slide 21: Analysis of results
Results Presentation Nine Months 2023 Analysis of results www.iberdrola.com | 21
Slide 22: Income Statement / Group
Results Presentation Income Statement / Group Nine Months 2023 EBITDA up 13% to EUR 10,783 M, and Net Profit would have increased 22% to EUR 3,799 M, excluding one-off non-cash impact in Mexico (EUR -162 M) EUR M 9M 2023 9M 2022 % Revenues 37,193 37,903 -1.9 Gross Margin 17,200 14,656 +17.4 Net Oper
Slide 23: Gross Margin / Group
Results Presentation Gross Margin / Group Nine Months 2023 Gross Margin up 17% to EUR 17,200 M… Revenues (EUR M) Procurements (EUR M) 37,903.3 -1.9% 37,193.0 23,247.4 -14.0% 19,993.3 9M 2022 9M 2023 9M 2022 9M 2023 … driven by higher production and lower procurement costs www.iberdrola.com | 23
Slide 24: Net Operating Expenses / Group
Results Presentation Net Operating Expenses / Group Nine Months 2023 Excluding extraordinary1 and reconciliation impacts in the US, Net Personnel Expenses increases 5.2% and External services 9.4%... Net Operating Expenses (EUR M) Recurrent 9M 2023 9M 2022 vs’22 (%) vs’22 (%) Net Personnel Expenses
Slide 25: Results by Business / Networks
Results Presentation Results by Business / Networks Nine Months 2023 Networks Reported EBITDA reaches EUR 4,397 M 28% Spain Brazil 32% 4,396.7 20% United Kingdom United States 20% 9M’22 positively affected by one-offs in US totaling EUR 598 M partially compensated by legal case in Spain (EUR 203 M)
Slide 26: Networks EBITDA by country
Results Presentation Results by Business / Networks Nine Months 2023 EBITDA EUR 1,247.5 M (+20.1%): SPAIN • Driven by a negative one-off in 9M ’22 related to a legal case that reversed at the end of the year (EUR -203 M) EBITDA GBP 767.5 M (+13.3%): UNITED • Higher contribution both in Transmission
Slide 27: Energy Production and Customers
Results Presentation Results by Business / Energy Production and Customers Nine Months 2023 Energy Production and Customers EBITDA increases 34% to EUR 6,374 M RoW Mexico 5% 9% Brazil 4% United States 8% 6,373.7 50% Spain* United Kingdom 24% * 1.2% revenue tax in Spain included in corporation while
Slide 28: Energy Production and Customers: Spain, UK, US
Results Presentation Results by Business / Energy Production and Customers Nine Months 2023 EBITDA EUR 3,155.5 M (+37.4%): • Compared to a weak 2022 as a result of: SPAIN o Production reaching normal levels, especially hydro and nuclear (+4.4 TWh) and higher sales due to a gain in market share (27.6
Slide 29: Energy Production and Customers: Mexico, Brazil, RoW
Results Presentation Results by Business / Energy Production and Customers Nine Months 2023 EBITDA USD 645.6 M (-8.9%): MEXICO • Lower contribution from renewable assets and contracted plants (PIEs) partially compensated by the new capacity in operation (Tamazunchale II) EBITDA BRL 1,345.3 M (-16.2%
Slide 30: EBIT / Group
Results Presentation EBIT / Group Nine Months 2023 EBIT grows 20% to EUR 6,813 M EBIT (EUR M) D&A and Provisions (EUR M) 6,813 +20.3% 5,663 -3,866 +2.7% -3,970 -435 -476 -3,495 -3,431 9M 2022 9M 2023 9M 2022 9M 2023 D&A and provisions up 2.7% to EUR 3,970 M, driven by higher asset base and bad debt
Slide 31: Net Financial Results / Group
Results Presentation Net Financial Results / Group Nine Months 2023 Net Financial Results up EUR 287 M to EUR 1,666 M, due to higher average debt and interest rates, partially offset by FX derivatives results NET FINANCIAL RESULT (EUR M) COST OF DEBT -229 +87 -1,666 +75 bps 4.98% -158 -1,379 +13 4.2
Slide 32: Financial ratios and Adjusted Net Debt
Results Presentation Financial ratios and Adjusted Net Debt / Group Nine Months 2023 FFO / Adjusted Net Debt at 23.2% FFO grows 11% to EUR 11,103 M excluding hydro canon recovery in 20221 ADJUSTED CREDIT METRICS ADJUSTED NET DEBT (EUR Bn) Sep. 2023 Sep. 2022 47,9 (5-6) Dividend3 & Taxes Adjusted Net
Slide 33: Financing Strategy
Results Presentation Financing Strategy Nine Months 2023 2023 & 2024 maturities fully covered with already signed financing and expected proceeds DEBT MATURITIES & HYBRID CALLS (EUR M) 5,600 Strong liquidity position of EUR 20,200 M 700 ~85% reaches 21 months of debt fixed1 2024 maturities fully cov
Slide 34: Financial strength
Results Presentation Financial strength Nine Months 2023 Diversified portfolio provides flexibility to target the markets at the right timing achieving very favorable conditions NEW FINANCING 2023: EUR 5,988 M TOTAL ESG PORTFOLIO: 66% of the total portfolio Development Bank Hybrid Bond Loan EUR 1,00
Slide 35: Net Profit / Group
Results Presentation Net Profit / Group Nine Months 2023 Net Profit grows 17% to EUR 3,637 M, +22% excluding Mexico one-off EUR M 9M 2023 9M 2022 vs’22 (%) EBIT 6,812.9 5,663.4 +20.3% - Net Financial Expenses -1,666.0 -1,379.1 +20.8% - Equity Method 212.6 171.4 +24.0% - Corporate Tax -1,312.0 -787.5
Slide 36: Ready for "Higher for Longer"
Results Presentation Ready for “Higher for Longer” Nine Months 2023 Structurally, IBE business is protected from inflation and interest rate rises… ~ 50% EP&C ~50% • Revenues fully updated on a yearly basis • Inflation indirectly embedded with actual inflation • c.70% long term PPAs (~40% with escal
Slide 37: Conclusions
Results Presentation Nine Months 2023 Conclusions www.iberdrola.com | 37
Slide 38: Ongoing improvements drive increase in 2023 outlook
Results Conclusions Presentation Nine Months 2023 ONGOING IMPROVEMENTS IN RESULTS DRIVE A NEW INCREASE IN 2023 OUTLOOK TO DOUBLE DIGIT GROWTH… 2023 Net Profit Growth Outlook Driven by 9M ‘23 Ongoing investment in Networks – New Rate Cases and tariff increases in the US and BR H1 ‘23 Double Increase
Slide 39: Key Pillars CMD '22 Delivery
Results Conclusions Presentation Nine Months 2023 …THANKS TO A DIVERSIFIED GROWTH MODEL THAT ANTICIPATED MACRO TRENDS Key Pillars CMD ‘22 Delivery ▶ RAB grows 9% to reach Eur 41.3 Bn GROWTH IN NETWORKS ▶ 96% of 2025 Regulated asset base with frameworks closed ▶ Installed Capacity reaches 41,300 MWs
Slide 40: Next Capital Markets Day in March 2024
Results Capital Markets Day Presentation Nine Months 2023 OUR NEXT CAPITAL MARKETS DAY WILL BE HELD IN MARCH 2024… …WITH MORE INFORMATION ABOUT GROUP OUTLOOK FOR THE NEXT YEARS www.iberdrola.com | 40
Slide 41: Annex I
Results Presentation Nine Months 2023 Annex I “Iberdrola Retribución Flexible” programJanuary2024 www.iberdrola.com | 41
Slide 42: "Iberdrola Retribución Flexible" program January 2024
Results Presentation “Iberdrola Retribución Flexible” program January 2024 Nine Months 2023 Closing prices LAST TRADING DATE considered for determining the - Announcement of capital average price used to increase in BORME PAYMENT DATE calculate number of - Last day to buy IBE shares Last day of righ
Slide 43: Annex II
Results Presentation Nine Months 2023 Annex II www.iberdrola.com | 43
Slide 44: Liquidity and maturities
Results Presentation Liquidity and maturities Nine Months 2023 As of today, liquidity totals EUR 20.2 bn1 covering 21 months of financing needs with an average life of debt close to 6 years 25,260 Cash 2,829 Available financing 2,394 Credit lines 5,809 5,627 5,230 14,980 4,153 981 2023 2024 2025 202
Slide 45: Diversified financing portfolio at competitive rates
Results Presentation Diversified financing portfolio at competitive rates Nine Months 2023 Our strategy of diversification in funding sources provides flexibility to tap the market… % DEBT BY INSTRUMENT FINANCIAL SOURCES Bond market Bank loans • Main source of long-term financing 14,8% EUR bonds • S
Slide 46: ESG financing
Results Presentation ESG financing Nine Months 2023 Out of the EUR 6.0 Bn raised in 2023, EUR 5.3 Bn correspond to new green financing for a total portfolio of EUR 52.9 Bn in ESG transactions NEW ESG FINANCING 2023: EUR 5,260 M TOTAL ESG FINANCING: EUR 52,881 M Sustainable Bank Sustainable Loans Com
Slide 47: ESG
Results Presentation ESG Nine Months 2023 2022 2025e 2030e Specific emissions (global mix) Carbon Neutral in electricity generation in 2030 g CO2 /kWh 88 <70 Carbon neutral1 % assets with biodiversity assessment Biodiversity: Net positive impact in 2030 and Neutrality Plan 0% 20% 100%/ Net Positive
Slide 48: CC lberdrola
CC lberdrola