For these results contributed the improvement in financial results and a positive contribution from the operation in Chile, explained the company.
REN – Redes Elétricas Nacionais’ profits rose 2.8% to 119 million euros in 2019, up 5.2 million compared to 2018, according to a statement sent this Wednesday to the Securities Market Commission (CMVM). The recurring net profit reached 144.8 million euros, an increase of 5.5%.
“This increase resulted from better financial results, lower taxes [79.2 million, -5.4%] and the positive contribution of Chile, which also mitigated the domestic business performance, which was penalized by the reduction in the remuneration of assets,” explained REN in the income statement, emphasizing that “despite this favorable scenario, the EESC payment [extraordinary contribution on the energy sector] continues to have an important impact on REN’s results.”
Last year, REN paid 24.4 million of CESE, 900,000 euros less than in 2018, when this tax earned the company a contribution of 25.3 million euros. “The extraordinary tax on energy companies (raised the effective tax rate to 40.0%. Since its introduction in 2014, 152 million euros have already been paid,” the company said.
According to REN, 2019 was marked by record levels of renewable production, the first time photovoltaic production exceeded the annual mark of 1 TWh. Renewable production supplied 51% of national electricity consumption and coal recorded the lowest share since the opening of the Sines power station. The use of the Sines LNG terminal was also the highest ever.
Regarding the dividend, and taking into account the 2019 results, REN’s Board of Directors will propose, at the General Shareholders’ Meeting on May 7th, the dividend payment of 17.1 cents per share. “This amount is in line with that practiced in previous years and with REN’s dividend policy”, says the company.
Last year, the average cost of REN’s debt maintained the reduction begun in 2013, at 2.1%, compared to 2.2% in 2018. Net debt increased by 6.5% to 2,826 million euros due to the acquisition of Transemel in Chile in October.
“2019 was marked by the acquisition of the Chilean company Transemel, which joined the investment made in 2017 in 42.5% of Electrogas. These acquisitions are part of REN’s Strategic Plan, a conservative growth strategy. With this reinforcement of the company’s internationalisation, REN’s key priority, the operation in Portugal, remains unchanged,” REN explained.
EBITDA (earnings before interest, taxes, depreciation and amortisation) was 486.2 million euros, a 1.2% (6 million) reduction. Return on assets decreased 11.4 million, due to the reduction in the regulated asset base and interest rates on Portuguese government bonds. Even so, This was mitigated by the favourable evolution of Electrogas’ results and the beginning of the Transemel consolidation (2.5 million).
EBITDA for 2018 included the extraordinary sale of the LPG business (4 million), also with an impact on comparison with 2019;
Investment and transfers to exploration increased to 188.6 million and 190.6 million, respectively, with the electricity sector (74.7% and 79.6% of the total) standing out.