Naturgy increases profit by 20%, to 1.986 million, despite normalization of prices | Companies

After 2022 with historically strong earnings, 2023 will be even better. Spain’s largest gas company and third largest electricity company, Naturgy, recorded a net profit of 1.986 million euros in 2023, up 20.4%, despite the normalization of energy prices and an environment of “high volatility”. Debt, in turn, remained virtually stable at around 12 billion, according to data sent on Tuesday to the National Securities Market Commission (CNMV) and to which the market reacted with a decline of just over 1%. first hours of trading.

Gross operating profit (Ebidta) increased by 11% to €5.475 million. Of this figure, 2.638 million came from the retail chain business, a much more predictable and stable niche in which Naturgy recorded growth of 7%, and the remaining 2.949 million came from the liberalized business (+15%). The company suspended its Gemini project to split both activities into two fully independent listed companies: “It makes sense, but the conditions are not met right now,” Naturgy executive president Francisco Reines said.

The crisis in electricity and gas prices has been a boon for all energy companies, and Naturgy is no exception. Since the launch of its 21-25 strategic plan, the former Gas Natural Fenosa has recorded a cumulative gross operating profit of 13,958 million and paid out 3,908 million euros in dividends to its shareholders, while also significantly reducing its debt ratios despite a slowdown in 2023. chapter.

The energy company’s board of directors will submit a dividend proposal of 1.4 euros per share to the shareholders meeting on April 2, “in accordance with the adopted dividend policy,” aimed at, according to Reines, “a good result for 2023.” , one of the best in the history of the company.”

Open to “opportunities inside and outside Spain”

With liquidity of around $9 billion and debt under control, Francisco Reines was this Tuesday “attentive to any buying opportunity” that could arise both inside and outside Spain. In any case, he said, any acquisition must meet the criterion of financial “discipline”: “If that is the case, we will analyze any opportunity that may exist.” (…) The treasury will not be the limit: if there is somewhere to invest money, we will have options to do it.”

Naturgy’s CEO has also shown a willingness to involve financial partners in his own renewable energy projects, as other companies in the sector, such as Iberdrola or Repsol, are already doing. “If there were more opportunities to invest by combining partners, as others do, we could not say no in advance,” he said, denying that he would appoint a chief executive at the next shareholders meeting after the deal fell through. Operation Orrantia.

In 2023, the energy company invested 2.944 million euros, which is 53% more than in 2022. Of this amount, almost 70% went to liberalized businesses, especially renewable energy; the rest is for networks. Geographically, Spain took on 66% of the investment. However, Reines asked for more “long-term transparency from regulators.”

As was the case a year ago, legacy company Gas Natural Fenosa, which has only reported half-yearly results rather than quarterly since last year, is avoiding any forecasts for 2024 results. A decision that the company justifies with the dual argument of “extreme volatility in “energy markets and unexpected weather.” In any case, he said, “he hopes to repeat the level of investment in 2024 and (…) return dividends to current levels.”

Half-hearted concerns about demand

Asked about the sharp drop in demand for electricity and natural gas as a result of very sharp price increases during the energy crisis, Reines expressed “semi-concern.” “If that results from greater efficiency, that’s good for everyone. If this is a consequence of industrial relocation, then this is an economic problem. This is the part that worries us most – not as an energy industry, but as a society as a whole,” he emphasized. In the specific case of gas, the head of Naturgy pointed to the weather – two winters with temperatures noticeably higher than usual – as the “most important” factor.

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