ACCIONA posts a net profit of €78 million during first quarter (+6.9%)

• Energy: the company installed 126MW of new renewable energy capacity up to March and has 1.1GW under construction or about to start
• Infrastructure: backlog grows (+2.2%) with €1.2 billion in new EPC projects contracted during the period
• Capex: €316 million (+131.8%), mainly in new wind farms in Mexico, the USA and Chile
• Strategy: ACCIONA takes all necessary measures to deal with the impact of the pandemic

ACCIONA reported a net profit of €78 million in the first quarter of 2020 (+6.9%). The results reflect the contribution of new international renewable energy assets that came into operation during the period (126MW), and the accounting impact of increasing the useful life of the Company's wind and solar assets from 25 to 30 years, with effect from January 1, 2020. Turnover at the Infrastructure division remained almost flat (€1.1 billion), but with a strong increase in water business revenues (+93.5%).

The COVID-19 crisis had a moderate impact on ACCIONA's accounts in the first quarter. Lower energy prices, the suspension of some activities in the services division and lower activity in some concessions, were some of the tangible effects in the last weeks of the quarter.

While the company expects the impact of the pandemic will be felt more acutely in the second quarter of 2020, the company expects a potential gradual recovery during the rest of the year. ACCIONA has taken the necessary steps to address the situation with regard to the health and safety of its employees, the continuity of operations and the preservation of its business plans.

The Company has strengthened employee health and safety protocols with the introduction of new hygiene, social distancing, operational and teleworking measures. These came into effect ahead of lockdown orders in the countries where ACCIONA is present.

In addition, a global crisis committee has ensured the continuity of operations, many of which – including energy, water treatment and health services - are essential for the normal functioning of the economy and society in the midst of the crisis.

Lastly, ACCIONA has adopted a number of measures to protect its business plans from a medium and long-term perspective. Liquidity has been increased with new facilities totaling €900 million, while an 'investment grade' rating by the rating agency DBRS has given the Company greater flexibility in financing options. In addition, ACCIONA restated its proposed dividend for 2019, reducing it by half (€1.925 per share). The Group has also began implementing cost-cutting measures worth €100 million.

From an operational point of view, the company is in a solid position: a portfolio of operational renewable energy assets that exceed 10GW, plus 1.1GW under construction or about to start. The infrastructure backlog totals €11.64 billion, consisting mainly of EPC projects.

ACCIONA's gross operating profit (EBITDA) remained flat in the first quarter, at €325 million (-0.2%). The figure reflects the increase in Energy (+2.1%) and Other Activities (+200.2%). Infrastructure (-25.8%) reflects the lower contribution of some major international projects, such as the Quito Metro.

Group turnover fell slightly in the quarter to €1.62 billion (-5.1%), mainly due to a fall in Energy revenues (-12.5%), in the context of lower wholesale prices.

The vigorous pace of capital expenditure, totaling €316 million (+131.8%) led to a slight increase in net financial debt, which at 31 March 2020 amounted to €5.20 billion (€5.62 billion including the effect of IFRS16), representing a €304 million increase since end December 2019.

The Energy division invested €284 million in the construction of new capacity, mainly wind power, including the projects of Santa Cruz and San Carlos in Mexico, and Palmas Altas and La Chalupa in the United States. In the first quarter, the Company installed 126MW of new capacity and a further 709MW were under construction.

By division

The Energy division achieved a turnover of €476 million (-12.5%) and an EBITDA of €244 million (+2.1%).

As a result of the technical strength of its assets and in line with market practices, ACCIONA decided to increase the useful life of its wind and PV assets from 25 to 30 years for accounting purposes, which will reduce the depreciation costs of these assets and reverse in part the losses recorded in 2013 following the regulatory reform in Spain.

The international generation business grew during the quarter (+3.0%), driven by the contribution of new assets in operation. In the last twelve months, consolidated installed capacity increased by 554MW (400MW wind power in the US, Chile and Mexico and 154MW photovoltaic power in the Ukraine and Chile).

In the Spanish market, generation EBITDA (-6.8%) was affected by the lower average price obtained for the portfolio, in the context of lower wholesale prices in Spain (€34.9/MWh compared to €55.0/MWh in 2019).

Energy production in the first quarter of 2020 totaled 6,562GWh (+10.2%). As of March 31, installed capacity reached 10,240MW.

The Infrastructure division (Construction, Concessions, Water and Services) maintained its turnover practically flat with revenues of €1.1 billion (-0.4%), with a strong increase in revenues from the Water business (+93.5%).

EBITDA stood at €60 million (-25.8%). The contribution of the Water business to Group EBITDA, at 18 million euros (+20.8%), is particularly noteworthy given that it no longer includes income from the ATLL concession following its early cancellation in March 2019.

At the end of the quarter, the Infrastructure backlog totaled €11.64 billion (+2.2%), with 69% corresponding to projects outside Spain. During the first quarter of 2020, the Company won €1.2 billion in new EPC contracts, including the construction of a hospital in Panama and water projects in Hong Kong and the Philippines.

Within the Group’s Other Activities, Real Estate EBITDA grew to €10 million with the delivery of 130 residential units during the period. Funds under management at Bestinver stood at €4.92 billion, a 27.5% fall since December 2019 due to the impact of the COVID-19 crisis on financial markets.

Income Statement Data (Million Euro)  

Balance Sheet Data and Capital Expenditure (Million Euro)

Operating Data