Endesa accelerates closure of coal-fired powerstations at cost of 1.3Bn euros

ENDESA

Renta 4 | Faced by the changing market conditions directly affecting the profitability of coal-fired power stations in Spain, Endesa´s board has decided to accelerate end of their production without expecting any impact on operating profits.

This decision could imply an accounting deterioration of around 1.3 Bn€ (5.1% of stock market capitalisation). This will have to await the presentation of the results for the first nine months of 2019, expected on 5 November.

This deterioration will not impact on the company´s generation of cash, so should not impact the group´s dividend policy. In addition we expect that it will accelerate investment in renewables in the next few years. We expect no impact on share price. We reiterate our view of the shares. Objective Price 22.08 €, Maintain.

About the Author

The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.