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José Manuel Entrecanales: "Our business model is stable, predictable and focused on growth"

05/30/2019
  • "We are a unique company with the capacity to originate, design, build and operate complex, critical infrastructure assets that underpin the United Nations Sustainable Development Goals" 
  • Energy: the company has a portfolio of 7,500 MW of renewable projects and is reactivating investment in Spain 
  • Civil, Social and Water Infrastructure: the business remains very active in its core markets

José Manuel Entrecanales, Chairman of ACCIONA, told today's Shareholders' Meeting that the company operates in what he described as a "new industry — the development of infrastructure for the sustainable agenda, which transcends conventional industry classifications". In this context, he said that ACCIONA's business model is "stable, predictable and focused on growth, with a portfolio of projects that has a balanced risk-return profile." 

Addressing the shareholders, ACCIONA's Chairman said that the company has transformed itself as a result of two fundamental factors. One is the asset divestment process (Trasmediterranea, the solar thermal business in Spain, and the portfolio of rental housing, among others), which culminated last year and provided the company with more focus. The other, which is perhaps more important, is the strong demand worldwide for sustainable infrastructure. 

He said that, according to World Bank estimates, an average of $3.8 trillion must be invested each year between now and 2040 in order to attain 72% of the 17 Sustainable Development Goals proposed by the United Nations. "Business shares a responsibility for finding solutions to the great problems facing society," he stated. 

In this context, José Manuel Entrecanales defined ACCIONA today as a natural development of the company that was founded almost a century ago. "We are not a renewable energy company with a legacy civil engineering business. Nor are we a construction company with a large green power portfolio," he added. "We are a unique company with the capacity to originate, design, build and operate complex, critical infrastructure assets supporting the United Nations SDGs."

The Chairman noted that, like any company, ACCIONA must offer appropriate returns to its shareholders, adding that the company is "stable, predictable and focused on growth, with a portfolio of projects that has a balanced risk-return profile." 

He noted that 75% of the company's operating profit comes from highly predictable long-term assets and that the divestments that were completed in 2018 have enabled the company to focus its business and strengthen its balance sheet. 

José Manuel Entrecanales said institutional investors are beginning to comprehend and value the company's strategic positioning, in light of its good operating performance, and emphasised that ACCIONA produced a 46% return for shareholders since January 2018, the second best in the IBEX 35 in that period. 

Regarding the company's plans, he stated that ACCIONA currently has 1,000 MW of renewable energy facilities under construction and a pipeline of another 7,500 MW of diversified projects, split almost evenly between photovoltaic and wind and located basically in Mexico, Australia, Chile, the United States and Spain. With regard to the Spanish market, he said that the company has 1,600 MW of projects with grid connection rights and plans to raise that to 2,000 MW in the next 18 months. 

Referring to the Civil, Social and Water Infrastructure business, he noted that the company maintained a high level of activity, margins and order intake in many markets during 2018. Specifically in the Water business, he noted that its good performance in the Middle East ranks ACCIONA as a global leader in desalination. 

José Manuel Entrecanales told shareholders about the company's sustainability balance sheet: it has been carbon-neutral since 2016. Power generated by ACCIONA has avoided the emission of 14.7 million tons of CO2, equivalent to the annual emissions produced by 3 million people. 

The circularity index of ACCIONA's resource use increased to 29%, meaning that it turns waste into resources at a much higher rate than the world average of 9%. Additionally, water consumption in areas of water stress has been cut by 39%. 

ACCIONA's tax contribution amounted to €1,154 million in 2018, equivalent to 3.5 times the company's net profit.

 

Appointments and resolutions

The General Meeting of Shareholders ratified the appointment of Sonia Dulá as an independent director in place of Belén Villalonga, and the re-appointment of Juan Carlos Garay. It also approved the directors' report, sustainability report and financial statements, including a dividend of €3.5 out of 2018 (+17%).

 

More information annualreport2018.acciona.com

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