Iberdrola ((IBDRY)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Iberdrola’s Recent Earnings Call Highlights Strong Performance Amid Challenges
The recent earnings call from Iberdrola conveyed a strong overall performance, marked by significant growth in net profit and investments, particularly in the Networks and Renewables sectors. Despite these positive developments, the company acknowledged challenges such as increased costs due to system operation changes and regulatory uncertainties in Spain.
Strong Net Profit Growth
Iberdrola reported a remarkable net profit of EUR 5,307 million, representing a 17% increase in adjusted net profit for the first nine months of 2025, excluding capital gains from asset rotation. This growth underscores the company’s robust financial health and strategic execution.
Robust Networks Business Performance
The Networks business demonstrated impressive performance, with EBITDA rising by 26%. This growth was driven by a higher rate base and improved regulatory frameworks, particularly in the United Kingdom and Brazil, highlighting the company’s effective management and strategic positioning in these regions.
Record Investment and Capacity Expansion
Iberdrola achieved a record total investment of EUR 9 billion, adding 2,000 megawatts of new capacity in the last 12 months. This investment underscores the company’s commitment to expanding its capacity and enhancing its infrastructure.
Improved Financial Position
The company successfully reduced its consolidated net debt by EUR 3.2 billion to EUR 48.5 billion, thereby improving its financial ratios and aligning with a BBB+ rating. This reduction reflects Iberdrola’s strategic focus on maintaining a strong financial position.
Increased Shareholder Remuneration
Reflecting its strong operating performance and financial position, Iberdrola increased interim shareholder remuneration by 8.2% to EUR 0.25 per share. This move demonstrates the company’s commitment to delivering value to its shareholders.
Positive Developments in Renewable Energy Projects
Significant progress was made in offshore wind projects in the UK and US, including the East Anglia THREE and Vineyard Wind 1 projects. These developments highlight Iberdrola’s leadership in renewable energy and its focus on sustainable growth.
Impact of Ancillary Service Costs
The company’s EBITDA from Renewables & Customers was negatively impacted by lower market prices and higher ancillary service costs in Iberia due to system operation changes. This challenge underscores the volatility and complexity of the energy market.
Challenges in Spain’s Regulatory Framework
Iberdrola faces uncertainty regarding the regulatory framework for networks in Spain, which is affecting its investment plans. This regulatory challenge poses a risk to the company’s future growth in the region.
Negative Impact from Blackout in Iberia
The blackout in Iberia resulted in increased costs for ancillary services, impacting Iberdrola’s financial results. This incident highlights the operational challenges the company faces in maintaining reliable service.
Downturn in Brazilian Renewables
Brazil experienced a 23.6% decline in renewable and thermal production EBITDA compared to last year. This downturn reflects the challenges in the Brazilian market and the need for strategic adjustments.
Forward-Looking Guidance
Iberdrola provided guidance for the fiscal year 2025, projecting double-digit growth in adjusted net profit to over EUR 6.2 billion, with a target of reaching EUR 6.6 billion by year-end. The company plans to use capital gains from transactions to enhance future efficiencies and intends to invest further in storage and renewable energy projects, particularly in the U.S. and the U.K.
In conclusion, Iberdrola’s earnings call highlighted a strong performance with significant growth in net profit and investments, despite facing challenges such as regulatory uncertainties in Spain and increased costs. The company’s forward-looking guidance indicates continued growth and strategic investments, reinforcing its position as a leader in the energy sector.