Naturgy Navigates Tough Q1

Spanish energy supplier and transporter Naturgy reported April 30 a “robust” start to the year, gradually de-risking its business profile as network tariffs in Latin America were allowed to rise. It has also paid down some of its net debt: it is now €15bn ($16.8bn), down 2% from the start of the quarter, after the €560mn dividend payment and €135mn share buy-back. 

Earnings for the first quarter before interest and tax (Ebitda) were €1.16bn, up 6% on Q1 2018. Net income was €377mn, up 16%. Gas & Power recorded an ordinary Ebidta of €409mn, up 1.2%, despite the decline in gas prices. Gas infrastructure benefited from efficiencies, despite lower throughput caused by the mild temperatures.

It said it is on track to deliver the €100mn additional efficiencies expected for 2019, and reiterated its commitment of €500m efficiencies by 2022 under its five-year strategic plan. 

This investment effort represents an advance in Naturgy’ s industrial plan, with 138 MW of renewable energy already put in operation in 1Q19 and other 777 MW expected to come into operation throughout the year.

Global installed operating capacity as of March 31 reached 1.319 GW, a 15% increase over Q1 2018. The company has also invested in the development of 180 MW of wind capacity in Australia and 324 MW of wind and solar capacity in Chile that will come into operation before 3Q 2020 and 1Q 2021, respectively.

In Chile, Argentina and Brazil,Ebitda was €194mn (up 15%), thanks to the efficiencies achieved and the tariff indexation. In Mexico and Panama, the ordinary Ebitda was €101mn, up 68% compared with the same period of 2018, on the back of positive regulatory impacts, higher demand and efficiency improvements.