Spanish utility Iberdrola posted increased profits and earnings before interest, taxes, depreciation and amortisation (EBITDA) in Q1 2024, despite its net electricity production and installed capacity decreasing year-on-year (YoY).
Iberdrola’s reported net profit was €2.76 billion (US$2.95 billion) in the first quarter of the year, compared with €1.49 billion (US$1.59 billion) in Q1 2023. The increase is largely attributable to Iberdrola’s February sale of 55% of its Mexico business; the company said that the sale alone added €1.16 billion in net profit this quarter.
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Excluding this, and the recovery of a tariff deficit recorded in its UK business, net profit rose by 28%.
EBITDA was €5.86 billion in Q1 2024, compared with €4.07 billion in Q1 2023. This increase was also due to the Mexico sale.
Iberdrola’s investment in its renewable energy business also increased year on year, by over 50% to €994 million. The largest share of this investment was in offshore wind assets. Last month, the utility said that it would invest US$17 billion into renewables over the next two years.
40% of its total investments for the quarter were represented by transmission projects.
Increased solar capacity
Iberdrola’s net installed solar PV capacity rose by 35.4% YoY, from 4,576MW in Q1 2023 to 6,195MW in Q1 2024.
Its capacity in its native Spain grew the most sharply, up 46.9% YoY from 2,777MW to 4,079MW. In February 2023 Iberdrola signed a financing deal with the Sovereign Wealth Fund of Norway to develop around 1GW of solar PV capacity in Spain, a deal which was expanded in January this year with financing for another 1.3GW of Iberian renewables.
Q1 renewables production in Iberia increased by 19% to 10,600GWh, which Iberdrola said was a ten-year high.
Its US solar capacity also rose significantly, from 529MW in Q1 ’23 to 733MW in Q1 ’24, a 38.5% increase. Iberdrola’s US project development subsidiary, Avangrid, cancelled a planned merger with the Public Services Company of New Mexico (PNM) in January after the legal terms of the deal were not met.
Its solar capacity in Mexico and Brazil decreased marginally, whilst it added 9MW to its UK portfolio.
Ignacio Galán, executive chairman of Iberdrola, said: “The first quarter has seen strong operating performance in all markets, with greater contribution from our increased networks asset base and improved renewables production.”
Forecasting the rest of the year, Galán continued: “Our record investment levels in the first quarter will drive a total spend of €12 billion euros this year. The good start to the year has allowed us to increase our guidance for 2024, with net profit now expected to grow at a high-single-digit rate.”