Iberdrola launches a historic investor 'megaplan' of 75,000 million until 2025

Iberdrola has launched a historic investment 'megaplan' of

for the period 2020-2025, the largest for a Spanish company, with the aim of anticipating and taking advantage of the opportunities of the energy revolution faced by the main economies of the world and promote reactivation in the face of the current Covid-19 crisis, the group announced on the occasion of its Capital Markets Day.

Specifically, 90% of this investment volume -68,000 million euros- will be organic and will be aimed at consolidating its business model, based on more renewable energy, more networks, more storage and more intelligent solutions for its customers.

The remaining 7 billion euros correspond to the recently announced acquisition of the American company PNM Resources.

The cruising speed that the group chaired by Ignacio Sánchez Galán will impose in this period will mean an average investment of

, between 2020 and 2022, and of 13,000 million euros per year in the period of 2023 and 2025.

This investment rhythm will be accompanied by profitable growth during the period, while maintaining financial strength and remuneration for its shareholders.

Thus, the energy company expects to obtain a gross operating profit (Ebitda) of 15,000 million euros by 2025, which means increasing that obtained in 2019 by 5,000 million euros, registering an

and increasing its profit net up to 5,000 million euros, after growing annually during the period between 6% and 7%.

This means that at the end of the period the group estimates a growth in its profits of almost 47% compared to the record profit of more than 3,400 million euros that it reached in 2019.

Likewise, Iberdrola has carried out an upward review of the group's prospects for 2022, despite facing the context of Covid-19.

And thus, the net profit in 2022 will be in a range between 4,000 million and 4,200 million euros, compared to the 3,700-3,900 million expected for that year in the 2018-2022 plan.

With regard to shareholder remuneration, it will increase in line with the results and a growing floor of between 0.40-0.44 euros per share is established by 2025. The dividend policy is maintained and places the 'pay out' between 65% and 75%.

The group will continue executing its 'Iberdrola Retribución Flexible' program with its corresponding buy-back programs, which avoid shareholder dilution.

Meanwhile, gross investments will rise by 35% and will reach 50,000 million -of these, there will be 36,000 million in the period 2020-2022-, compared to the 38,000 million expected, and efficiencies will rise to about 1,600 million, exceeding 1,200 million euros foreseen in the previous plan and maintaining the

With this investment plan for the next six years, the largest for a Spanish company, Iberdrola hopes to contribute to the revitalization of the industrial fabric and employment in the countries where the group operates.

"Our business model, after 20 years

places us as a key driving agent in the transformation of the industrial fabric, promoting with our experience, social commitment and financial capacity, a long-term sustainable economic growth model capable of face the current challenges of society ", Galán stressed.

The group will maintain the social market economy and the United Nations 2030 Agenda as the axes of its activity, and the investments and purchases of goods and services from its more than 22,000 suppliers will contribute to the maintenance of around 500,000 jobs. work in 2025 in the world.

Likewise, it foresees about 20,000 new hires in the group during the same period - by 2022 there will be more than 10,000 hires and it will promote the creation of up to 30,000 jobs.

The company, which in 2019 alone contributed 8,200 million euros to the taxation of the countries where it operates, expects its fiscal effort to increase in 2025, to 12,000 million euros, with the annual average for the next six years being 10,300 million of euros.

Likewise, Iberdrola expects to maintain its credit ratings at 'BBB + / Baa1' levels and its current debt ratios, supported by its ability to generate higher cash flows.

The company maintains a strong diversification of its sources of financing, which allow it access to different markets and active liquidity management, which is between 15,000 million and 22,000 million euros.

Likewise, Iberdrola will maintain a flexible approach based on investment opportunities and financial ratios.

Completed divestments of 4,600 million euros by 2020 - above the 3,500 million expected in 2022 -, it foresees new divestments of about 3,000 million euros between 2021 and 2025.

The imposed investor in renewables will allow Iberdrola to reach 60 gigawatts (GW) in 2025, after reaching 44 GW of installed capacity in 2022. This will mean doubling its current power, with a great boost to offshore wind technology, with 4 GW at the end of the period, a technology that contributes five times the Ebitda / MW compared to photovoltaic solar energy and three times compared to onshore wind energy.

Likewise, the group will grow prominently in solar photovoltaics, with a forecast of 16 GW installed at the end of the period and will reinforce its leadership in onshore wind and hydroelectric power, with 26 GW and 14 GW installed in 2025, respectively.

To carry out the plan, Iberdrola has a portfolio in renewables for a total of 70.5 GW distributed throughout its traditional areas - reinforced this year and with new markets such as Australia, Japan and Sweden.

By technologies, 30.7 GW are photovoltaic;

20.2 GW, offshore wind and 16.3 GW, onshore.

Currently, the company is progressing in the construction of 7 GW and would have up to 11 GW under execution in 2025.

As regards networks, the company will allocate 40% of these organic investments - a figure of more than 27,000 million - with which it will place the group's regulated asset base at 47,000 million euros in 2025, 1.5 times its current value.

This figure includes investments in transmission, which will reach 4,000 million.

In addition, it plans to increase its customer base in the world to 60 million, compared to 42 million at the end of 2019.

The group will also turn green hydrogen into a strategic vector for the industrial segment.

In this sense, and in line with European recovery plans, the company foresees the installation of 600 MW by 2025 - it will be 800 MW by 2027, together with Fertiberia - and will produce 15,000 tons of renewable hydrogen.

In presenting the operational and financial forecasts for 2025 and, in line with the climate objectives of its main markets, the company has also advanced a ten-year horizon, in which it would raise its installed renewable capacity to 95 GW -after multiplying by 2 , 5 its onshore and solar wind power and by 4.5 the marine- and by two its regulated assets up to 60,000 million euros by 2030. At the end of this period, the base of its contracts with clients would grow to 70 million already 85,000 tons of green hydrogen.

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