Iberdrola (OTCPK:IBDR.Y) 2025 Capital Markets Day Transcript

Summary of Conference Call Notes Company and Industry Overview - The conference call primarily discusses Iberdrola, a leading global energy company focused on regulated networks and renewable energy investments. The company is emphasizing its growth strategy in the U.S., U.K., Brazil, and Spain. Key Points and Arguments Investment Strategy - Iberdrola plans to invest approximately €58 billion over the next four years, with 85% allocated to countries with high credit ratings, focusing on stable markets with growth potential [19][20] - €37 billion of the total investment will be directed towards networks, with 60% of this amount aimed at expanding the asset base [20][21] - The company expects to increase its regulated asset base to €70 billion by 2028, with 65% concentrated in the U.S. and U.K. [22][23] Growth in Regulated Networks - The regulated asset base is projected to grow by 40% from €49 billion in 2024 to €70 billion by 2028 [22][23] - Distribution will account for over 70% of the total asset base, reaching €50 billion by 2028 [23] - Transmission investments are expected to double, reaching €20 billion by 2028 [23][24] Renewable Energy Investments - Iberdrola plans to invest €21 billion in power generation, with significant allocations for offshore wind farms and solar projects [10][39] - The company aims to secure 75% of new capacity under long-term contracts, ensuring stable revenue streams [40][46] Financial Performance and Projections - By 2028, Iberdrola expects to achieve an EBITDA of €18 billion, an increase of €3 billion from 2024 [62] - The U.S. and U.K. are projected to contribute 50% of total EBITDA by 2028, up from 37% in 2024 [63][64] - The company maintains a BBB+ credit rating, ensuring financial stability and access to capital for its investment plans [14] Regulatory Environment - Iberdrola benefits from stable regulatory frameworks in its key markets, which provide visibility and attractive returns on investments [24][26] - The company is actively engaged in regulatory negotiations to secure favorable conditions for its projects in the U.S. and U.K. [27][29] Risk Management and Operational Efficiency - The company is focused on reducing its exposure to energy price volatility, limiting it to 25% of total EBITDA [12][13] - Iberdrola is implementing digitalization and automation strategies to enhance operational efficiency and reduce costs [51][52] Shareholder Remuneration - Iberdrola plans to maintain a dividend payout ratio between 65-75% of earnings per share, with a minimum floor of €0.64 per share [14] - The company has a history of providing strong total shareholder returns, outperforming major indices over the past decade [71][72] Additional Important Insights - Iberdrola's diversified geographical presence minimizes risks associated with regulatory changes in any single market [23][29] - The company is committed to sustainability, aiming to achieve carbon neutrality by 2030 [16][15] - Iberdrola's investment in R&D is projected to be at least €1.6 billion by 2028, reinforcing its position as a leader in the utilities sector [15] This summary encapsulates the key points discussed during the conference call, highlighting Iberdrola's strategic focus on growth, investment in regulated networks and renewables, financial performance, and commitment to shareholder value.