Naturgy changes its roadmap: less investment and higher shareholder remuneration. The gas company has updated its objectives for the 2021-2025 period and investments will drop by 800 million euros, from 14,000 to 13,200 million. On the contrary, it will compensate the funds and the rest of the shareholders with more dividend while it finds the opportune moment to relaunch the division of the company in two through the ‘Geminis’ project.
The president and CEO of the company, Francisco Reynés, highlighted this Monday in a meeting with the press in Madrid that despite the cut, only between 2023 and 2025, 10,000 million euros will be invested, which means doubling the average of the last 20 years. “They will be investments that will make all the industrial and financial sense. We will bet on greater investments in the wind ‘mix’ because they are more protected,” Reynés stressed shortly after presenting a net profit of 1,045 million euros to the market.
For its part, the company will distribute 6,600 million in dividends, which means improving remuneration by almost 12% compared to what was announced two years ago. In this sense, it raises the floor of the annual dividend for the period to 1.40 euros per share (compared to the 1.20 gross euros per share that it has distributed charged to the 2022 accounts), always subject to maintaining a BBB credit rating by S&P. This new floor is consistent with the average ‘payout’ of 85% announced in July 2021 for inflation.
council endorsement
This upward revision of the dividend is part of the dispute that occurred last week within the board of directors to find Francisco Reynés a number two (movement that is ruled out for the moment). After several days of speculation and the arrival of Ignacio Gutiérrez-Orrantia being practically taken for granted, all the shareholder representatives ratified their “firm commitment to the company’s industrial project and their total confidence in the management team”. Criteria Caixa, with 26.7% of the capital, is the main shareholder, followed by the CVC funds, with 20.7%; GIP, with 20.6%; and IFM, with 14%.
At the same time that it rewards shareholders, Naturgy works to relaunch ‘Geminis’ as a possible escape route for CVC and GIP. Reynés returned to defend this Monday the “industrial sense” of the ‘spin-off’ but without daring to set a date. Although the Mallorcan executive did not refer to the political context either, the current government has already hinted that it did not agree with the separation of Naturgy into two listed companies and a change in La Moncloa could facilitate the operation.
One of the two groups will manage the liberalized businesses in an integrated manner (Naturgy MarketsCo): the development of renewable energies; When it announced the plan in February 2022, this part of the business had targets for 2025 of more than 25 gigawatts (GW) of installed electricity generation capacity (14 renewable and 11 conventional), 11 million customers, and a diversified portfolio of approximately 290 terawatt hours (TWh) of gas supplies.
For its part, the other will bring together all the regulated infrastructures (Naturgy Networks) for energy distribution and transmission. The asset base at that time was more than 155,000 km of electricity networks, 135,000 km of gas networks and 16 million connection points -present in 6 countries-.
lower the debt
The semi-annual results report that Naturgy sent to the National Securities Market Commission (CNMV) already included a classification of economic and financial information between Networks and Markets, following the structure that would result from the execution of the Geminis project. The Networks businesses registered a gross operating profit (ebitda) of 1,261 million euros between January and June, an increase of 5.3% compared to the same period of the previous year and 43% of the group. For their part, the liberalized activities registered an aggregate ebitda of 1,677 million euros, 84.1% more and 57% of the total.
Ascertaining a more favorable environment than when it launched the strategic plan (in July 2021), the company also estimates that it will close 2025 with a net debt of 16,000 million, 1,000 million less than the previous forecast. In addition, it calculates to earn 1,800 million and achieve a gross operating profit of 5,100 million; 300 above previously announced figures.
