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- On a like-for-like basis, net income after tax from continuing operations, which includes only the Spanish and Portuguese businesses, increased by 15.6% on 2014.
- 2014 Net Income (3,337 million euros) included the net gain from the sale of the Latin American operations to Enel for 1,764 million euros, along with the 623 million euros generated by these operations up to the transaction date.
- EBITDA was 3,039 million euros, down 1.7% as a result of the normalization of the company’s business margins (which in the previous year of 2014, when they were extraordinarily high) and the provisions made for the latest stage of workforce restructuring. These results, both EBITDA and Net Income, are above the market guidance included in the latest strategic update in November 2015. This proves Endesa’s capacity, to not only to meet, but even to exceed our financial targets.
- The higher costs for the purchase of electricity were offset by a higher sale price to deregulated market customers and by the sale of the European Union Allowances (EUAs) obtained after the exchange process of Emission Reduction Units (ERUs) and Certified Emission Reductions (CERs) as well as by the introduction of a cost reduction plan.
- EBIT increased by 8.6% to 1,598 million euros, mainly due to the reduction in depreciation which was mainly attributable to the extension of the useful lives of nuclear power plants and CCGTs from October 1st, 2014.
- The net financial debt stood at 4,323 million euros in 2015, a 1,097 million euro reduction on the figure posted as of December 31st, 2014 that was due mainly to the improvement in operating cash flow.
- The Board of Directors will propose a dividend on 2015 results for the approval of the General Shareholders’ Meeting that will be 35% higher than the 2014 dividend.
Endesa’s net income during 2015 stood at 1,086 million euros, 2,251 million euros less than in 2014. This decrease is attributable to the fact that the results for 2014 included the net gain from the sale of the Latin American operations to Enel in October 2014, for 1,764 million euros and the 623 million euros generated by these operations until the date of sale.
Considering only continuing operations or a comparison between these two periods on a like-for-like basis, which refer exclusively to net income after tax from operations in Spain and Portugal, the increase in net income would have been 15.6%.
Endesa CEO, José Bogas, pointed out that, "In 2015, Endesa has once again taken a very important step forward in an uncertain environment: Endesa presents stable and predictable results over the time, not only meeting the financial targets announced to the market, but even surpassing them.” “These results allow us continue with the company’s attractive dividend policy."
Unless otherwise stated, all data included in the information below refer exclusively to continuing operations, e.g. to the business in Spain and Portugal, meaning that the comparison between the two periods is carried out on a like-for-like basis.
Operational results
Electricity demand in the Iberian Peninsula increased by 1.8% in 2015 compared with the year before, an increase of 1.6% after adjustment for working days and temperature. This increase comes alongside indicators showing a certain recovery in the Spanish economy. The growth in electricity demand led to an increase in Endesa’s energy generation, particularly from thermal power plants, as the exceptional rainfall levels reached during 2014 were not repeated in 2015.
As a result of the above, Endesa’s mainland ordinary regime electricity output totalled 60,686 GWh, up 5.5% on 2014, due to the increase in production from CCGTs ( +94.7%), and coal-fired power plants ( +9.5%) and nuclear power output (up 4%), which offset the 18.3% drop in hydro output.
Nuclear and hydro technologies accounted for 54.3% of Endesa’s ordinary regime mainland generation, compared to 58.3% in 2014, and against the 52% recorded by the rest of the sector in 2014.
As regards other operating figures, Endesa generated 12,375 GWh in extra-peninsular territories (TNP), (up 1.6%), distributing 114,190 GWh across the Spanish market (up 2.9%), and sold 77,965 GWh to deregulated market customers (up 0.8%) and 14,934 GWh on the regulated market (down 9.8%); its gas sales amounted to 71,587 GWh (down 3.7%).
As a result of the above factors, in 2015 Endesa attained a 38.8% market share in mainland electricity generation under ordinary regime, 43.5% in distribution and 35.7% in sales to deregulated market customers.
Financial Results
Endesa’s Revenue reached 20,299 million euros in 2015, compared with the 21,512 million euros posted in 2014. This decrease is due to the unfavorable performance in commodity prices over the year.
EBITDA rose to 3,039 million euros, a 1.7% drop on 2014, taking into account the following factors:
- In 2015, the deregulated market’s gross margin normalised, after the exceptionally positive figures posted in 2014. The decrease in gross margin can be mainly attributed to the higher cost of the electricity purchased and higher taxes on electricity generation. The average weighted price in the wholesale electricity market reached 51.7 euros/MWh in 2015 (up 23.1% on 2014).
- As part of Endesa's restructuring and reorganisation plan in Spain, a provision of 380 million euros (349 million euros in 2014) for workforce restructuring projects was recorded in 2015.
- The unfavourable effects outlined in the previous paragraphs have been almost entirely offset by the combined effect of the higher prices in thederegulated market and the 184 million euros posted from the forward sale on December 17th, 2015 in relation to the European Union Allowances (EUAs) obtained from the swap of Emission Reduction Units (ERUs) and Certified Emission Reductions (CERS) as per Commission Regulation (EU) no. 389/2013, articles 58-61.
- Furthermore, as part of the plans aimed at improving operational efficiency and the cost reduction measures implemented, other 2015 operating costs were 7.9% lower than in 2014.
EBIT posted in 2015 was 126 million euros higher (up 8.6%) than in 2014, reaching 1,598 million euros, as a result of the reduction in depreciation which was mainly attributable to the extension of the useful lives of nuclear power plants and CCGTs as from October 1st, 2014 (129 million euros).
During 2015, Endesa disposed of the assets associated with the Chira-Soria hydroelectric power plant in Gran Canaria as well as all the shares in Compañía Transportista de Gas Canarias, S.A., Ayesa Advanced Technologies, S.A. and Gasificadora Regional Canaria, S.A. The gross capital gain for Endesa amounted to approximately 10 million euros.
Net financial debt, cash flow and investments
As of December 31st, 2015, Endesa’s Net Financial Debt stood at 4,323 million euros, a 1,097 million euro reduction on the figure posted as of December 31st, 2014.
This reduction was possible because operating cash flow, which amounted to 2,656 million euros, was higher than the sum of the investments and the ordinary dividend posted on 2014 results.
Endesa’s gross investment was 1,084 million euros in 2015 of which 1,025 million euros related to capex, investment in intangible assets and investment property while the remaining 59 million euros was related to financial investments.
Dividends: 35% more than in 2014
In the meeting held on December 21st, 2015, the Board of Directors of Endesa agreed to pay out an interim dividend on 2015 results for a gross amount of 0.4 euros per share, equivalent to a total of 424 million euros, which was paid as of January 4th, 2016.
The proposed dividend distribution to shareholders for 2015, which will be presented for approval to the next General Shareholders’ Meeting by Endesa’s Board of Directors, will be for the gross amount of 1.026 euros per share charged to 2015 net income, an increase of 35% on the ordinary dividend posted on 2014 results. Taking into account the 0.4 euro/share dividend specified in the previous paragraph, the final dividend is expected to be for 0.626 euros gross per share.