Renta 4 | 2025 results in line with expectations across all lines of the income statement. The figures continue to be affected in comparison with 2024 by various extraordinary effects: capital gains generated in 2024 from the sale of assets in Mexico, while this year reflects the capital gains from the sale of smart meters and tax relief on network investments in the UK, as well as the recognition of costs incurred in previous years on networks in the United States. In recurring terms, EBITDA grew by 3.1%, reflecting: 1) networks, driven by strong performance in the United Kingdom (full consolidation of ENW) and the United States, thanks to the larger asset base and tariffs, as well as the effects of higher inflation and tariffs in Brazil and some positive adjustments in remuneration from previous years in Spain, and 2) in the generation and customer business, higher generation and greater renewable capacity did not offset the decline in margins and the increase in ancillary service costs in Spain, which fell by more than 15%; in the United States, improved wind and solar energy performance drove EBITDA growth, despite the positive effect in 2024 related to the Arctic Blast storm; in the United Kingdom, lower EBITDA from the trading business due to prices and volumes, together with lower wind resources and lower prices, as well as the deconsolidation of East Anglia, are offset by the capital gain from the sale of smart meters; in addition, there is a greater contribution from the St. Brieuc and Baltic Eagle offshore wind projects. In terms of net profit, the improvement corresponds to the positive effect of tax relief on network investments in the United Kingdom and capital gains from smart meters, as well as a better result from minority interests.
In comparable terms, net profit grew by 10%, in line with guidance. Operating cash flow increased by 8.2% versus 2024, with investment reaching €12.563 billion (5.2% versus 2024, 59% in the United Kingdom and the United States, €14.46 billion if we include the acquisition of 30% of Neoenergia), in line with our forecasts, allowing financial ratios to remain aligned with a BBB+ rating despite the consolidation of ENW. Despite this acquisition, the larger investments and the repurchase of the hybrid, the capital increase in July, as well as the deconsolidation of East Anglia’s debt, allow for a reduction in adjusted net debt of around 3%, in line with our forecast.
The company has shared a net profit target for 2026 that exceeds €6.6 billion, in line with expectations (€6.73 billion Renta 4 estimate and €6.654 billion FactSet consensus). By 2028, they expect to exceed €7.6 billion in net profit (versus €7.617 billion Renta 4 estimate and €7.572 billion FactSet consensus). Although we see solid earnings growth, we do not expect it to have an impact on the share price. We reiterate our overweight rating and target price of €18.60.
