Key Impact Points:
- Record Investment: €5.276 billion invested, a 16% increase.
- Significant Profit Growth: Net profit of €4.134 billion, up 64%.
- Renewable Energy Leadership: Emissions in Europe reduced to 26 gCO2/kWh; nearly 90% of production is emission-free.
- Job Creation: Supported over half a million jobs globally.
- Financial Strength: Total cash flow increased by 98% to €11.362 billion.
Historic Investments and Impact
Iberdrola’s investments in the first half of the year have had a significant impact on global activity and employment, as well as on environmental sustainability. The company made purchases worth over €7 billion from tens of thousands of suppliers, supporting more than half a million jobs worldwide. Contributions to public coffers have also grown by 20%, totaling €5.3 billion in the first half of the year.
Renewable Energy and Emissions Reduction
One of the standout achievements is the record renewable energy production, which has drastically reduced emissions in Europe to just 26 gCO2/kWh. Nearly 90% of Iberdrola’s production is now emission-free, showcasing the company’s commitment to decarbonization and sustainable energy. This is in line with their goal of generating 100% emission-free energy in key markets including the United Kingdom, Brazil, France, Italy, Germany, and others.
Operational Growth
The operational growth of Iberdrola has been driven by several key factors:
- An increasing network asset base and new tariff frameworks in the United States, the United Kingdom, and Brazil.
- Record renewable production levels.
- Recurring growth in pumped storage production, which reached 3,000 GWh in six months in the Iberian Peninsula.
- Expansion of the PPA portfolio with industrial clients and improvements in commercial markets in the Iberian Peninsula and the United Kingdom.
Financial Strength and Cash Flow
Iberdrola’s financial strength remains robust, with total cash flow up 98% to €11.362 billion. Recurring cash flow reached €5.925 billion. The balance sheet has also improved, with liquidity at €21.7 billion, enough to cover 24 months without needing new financing. The sale of assets in Mexico, amounting to more than €5.4 billion, contributed capital gains of €1.165 billion after taxes.
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Strategic Investment Plan
The company’s strategic investment plan focuses heavily on the United States and the United Kingdom, which received 56% of the investments. The Iberian Peninsula accounted for 19%, Latin America 15%, and other European countries and Australia the remaining 10%. Investments in electricity networks represented 51% of the total, with a notable increase in transmission networks. Iberdrola’s regulated network assets now exceed €43.3 billion.
Renewable Capacity Expansion
Iberdrola has added 3,100 MW of new renewable capacity, bringing the total to over 43,400 MW globally. This includes 800 MW of new offshore wind power in France, Germany, and the United States. The offshore wind projects under construction are progressing as planned, with expectations to have 4,800 new MW operational by 2026, contributing significantly to future EBITDA.
Shareholder Remuneration
Shareholder remuneration has increased by 11.4% to €0.558 per share. A final dividend of €0.351 per share will be paid on July 29. Iberdrola has already reached the dividend floor of €0.55 per share set in their strategic plan, with expectations to increase this to between €0.61 and €0.66 per share by 2026.
Improved Outlook for 2024
Chairman Ignacio Galán has improved the profit forecast for 2024, expecting double-digit growth in net profit, excluding capital gains from asset rotations. This optimistic outlook is supported by new network investments, tariff reviews, and the ongoing construction of 1,600 MW of renewable energy.
Future Prospects
Looking ahead, Iberdrola is well-positioned to capitalize on the electrification trend. The company is finalizing investment plans in transport and distribution for the next decade in the UK and the US. With more than 100 million kWh of operational storage and additional projects in the pipeline, Iberdrola is set to meet the increasing demand for renewable energy and reduce price volatility.
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Furthermore, the exponential rise in electricity needs for data centers positions Iberdrola uniquely, with 8,000 GWh already committed annually to large technology companies.
In conclusion, Iberdrola’s record-breaking investments and strong financial performance underline its leadership in the renewable energy sector and its commitment to sustainable growth. The company continues to drive forward with its 2024-2026 Strategic Plan, ensuring it remains at the forefront of the global energy transition.
