IBERDROLA net earnings rose 8.4% in the first quarter to 952.6 million, while recurring net profit excluding extraordinaries was 4.6% lower at €848 million. Ebitda was 0.3% lower at €2,126.5 million.
First quarter results reflect solid operating performance across the businesses, although affected by a €260 million impact on gross margin from regulatory decisions in Spain since July 2013. For 2014 as a whole, IBERDROLA estimates the impact of these measures at €380 million.
Net profit growth in the quarter reflects the contribution of international businesses and includes extraordinary gains from the sale of an IBERDROLA stake in EdP and assets in Brazil. In February, the company announced the sale of a 3.7% stake in EdP through a series of stock market transactions, reducing its shareholding from 6.6% to 2.9%. The remaining stake is subject to derivative arrangements that are triggered in May.
Recurring net profit, excluding extraordinary gains of €105 million, was 4.6% lower at €848 million. Contributing factors were the regulatory and fiscal measures in Spain. Recurring profit from international businesses rose 22.3% and made up 62% of the total, while in Spain it fell 25.2% to account for 38% of this item.
Gross margin was 1% higher at €3,386.3 million, driven by an excellent result in gas business, a 9.1% rise in production and a better generation mix which compensated the negative impact of currency fluctuations, lower prices and regulatory decisions in Spain. Operating efficiency improved as a result of operating expenses remaining flat at €815 million, made possible by cost control and reduced operating and maintenance costs.
Levies rose 9.9% in the period to €444.6 million, of which 64% – €286 million – relates to Spain where they rose 21%.
Group Ebitda was in line with the previous period at €2,126.5 million (-0,3%), driven by good performance in generation and supply, which in was turn helped by a greater contribution from gas businesses and a more efficient generation mix. in Spain and cold weather in the US. This helped offset the negative impact of measures in Spain on renewables and networks.
Net financial expenses were reduced by 20% to €213.8 million, while operating cash flow was 2.9% higher at €1,660.4 million, exceeding the level of investments in all businesses.
Press Release, April 30, 2014; Image: iberdrola