Endesa today reported to the market the results obtained in the first quarter of 2022, which it considers to have been "a period strongly marked by the deterioration of the macroeconomic scenario and the high prices of raw materials and, singularly, of gas (350% more expensive on average than in the first quarter of 2021)". As a consequence of all this, "and following the trend of the second half of 2021 -explain from the company-, prices in the wholesale electricity markets have reached an average of 229 euros in Spain, 232 euros in France, 249 euros in Italy or 238 euros in the United Kingdom between January and March". Despite all this, Endesa announced today a net profit of almost 380 million euros and announced that it is maintaining the forecasts for the whole of 2022 that it communicated to the market at the time. These are: gross operating profit (ebitda) of 4.1 billion and ordinary net profit of 1.8 billion.
In terms of the main financial figures, the company reported a 10% decline in ebitda (earnings before interest and taxes, devaluation and amortization), to 914 million euros (ME). This is 10% less than in the first quarter of last year. Endesa qualifies in any case: the ebitda for the first quarter of this year would grow by 10% if we do not take into account the extraordinary items recorded in the first quarter of 2021, essentially the 188 million from a court ruling relating to CO2 rights (an amount that was actually received in an extraordinary way and which to a certain extent distorts the comparison).
For its part, ordinary net income came to E338 million, thirty-one points less than that recorded for the same period in 2021 (-31%). The company also clarifies here: "without taking into account the extraordinary result of last year's CO2 ruling, ordinary net profit would grow by 14%". Endesa assures that at the end of March, it had 100% of its own energy (nuclear, hydroelectric and non-regulated renewable energy) sold for this year, and 82% by 2023.
José Bogas, CEO of Endesa: "We are starting the year facing an even more challenging situation than last year, marked by macroeconomic tensions resulting from the impact of the war in Ukraine and by the transfer of this conflict to a commodities market that has already been highly inflated for months. Endesa remains confident in the strength of its vertically integrated business model to meet the 2022 targets. And we also maintain our strategy of advising and helping all customers, under any type of tariff, to overcome the turbulence of the energy market in their homes and businesses."
As for other relevant operating figures, the Italian company highlights that it has already in operation or execution 90% of the new renewable power planned for this year, as well as 70% for 2023. Specifically, Endesa has two thousand megawatts of renewable power (2,000 MW) "in execution" (half of the target contained in the 2022-2024 strategic plan) and has 8,000 MW of power "in an advanced state of administrative processing". All of this, the company reports, in Spain and Portugal.
The company highlights in its quarterly rendering of accounts "two relevant milestones" referred to Portugal
The first of them is the award of the Pego fair transition tender, the first of its kind to be developed in the Iberian Peninsula, through which Endesa will undertake an investment of 600 million to start up 365 MW photovoltaic, 264 MW wind and 168 MW of batteries, together with a 500 kW electrolyzer to produce green hydrogen. "All this -the company explains- to take advantage of part of the grid connection capacity after the closure of the Pego coal plant last November".
The second milestone is Endesa's first floating photovoltaic project to install 43.5 MW in the Alto Rabagão reservoir in Portugal, hybridized with 48 MW of wind power and 48 MW of batteries.
The Italian company also highlights in the quarter what it describes as "outstanding evolution of commercial activity towards retail customers, with a 13% increase in the customer portfolio in the deregulated market to 6.4 million in Spain and Portugal, compared to the first quarter of 2021".
As for electric vehicle charging points, they grew by 36%. According to data provided by the company, at the end of this first quarter, Endesa already had 10,200 charging points for electric vehicles, "including public and private".
Other financial figures
In its first quarterly financial report of the year, Endesa complains that the "complex situation of the raw materials markets, together with an increase in the regulatory items pending collection, have negatively affected the working capital necessary to finance the company's operations".
Luca Passa, CFO: "the first quarter of the year was marked by an extremely volatile energy scenario, which we were able to manage by relying on the strength of our integrated electric utility model. We are maintaining the steady pace of our transformation towards a decarbonized and sustainable company, with gross investments up 48% compared to the same period in 2021 to 402 million, mostly in networks and renewables. I would also highlight our comfortable liquidity position with 4,403 million, which allows us to cover almost two years of debt maturities."
According to the company, this has put cash flow from operations in the negative at 476 million euros (ME). Endesa considers that the rise in net debt at the end of the quarter (it has reached 10,334 ME) is motivated by three causes: the coverage of this negative cash flow, the investments disbursed (533 ME) and the payment of dividends (529 ME).
"The average cost of this debt - however, Endesa emphasizes - continues to fall and stands at 1%, a historical low for the company, half a point below that reported at the end of 2021". Moreover, the percentage of debt linked to sustainability criteria is up five points to 65% compared to the end of last year.
Endesa, which is owned by the Enel Group, is the leading electricity company in Spain and the second in Portugal. It is also the second largest gas operator in the Spanish market. It develops an integrated business (from generation to commercialization) and also offers, through Endesa X, "value-added services aimed at the decarbonization of energy uses in homes, companies, industries and Public Administrations". It declares a workforce that totals "around 9,260 employees". The main shareholder of the Enel Group is the Italian Ministry of Economy and Finance.
- Endesa 2020: electricity sales down 10%; net profit up 36% (February 2021)
- Endesa has connected a dozen wind and solar farms in the Covid year (January 2021).
- Endesa produces twice as much nuclear electricity as renewable (November 05, 2020)
- Endesa proposes to increase to 4,000 megawatts its thermal power plants in the Canary Islands (July 07, 2020)