Spain: Gas Natural Fenosa Profit Climbs

GAS NATURAL FENOSA of Spain obtained a net profit of 1.441 billion euros in 2012, which is 8.8% higher than in the previous year, despite having a lower contribution from capital gains from the sale of assets that took place in the previous period.

Consolidated EBITDA totalled 5.080 billion euros in 2012, which was 9.4% more than in 2011, supported by diversification and a growing contribution from the international sector and in the balance provided by the GAS NATURAL FENOSA business profile, which enabled the stagnation of regulated business contribution in Spain, conditioned by the divestitures made in 2011 and the effects of Royal Decree-Law 13/2012, to be compensated for. EBITDA would have grown by 11% in homogenous terms, if the divestitures made in 2011 were not taken into account.

These results, obtained in a much more demanding financial and regulatory macroeconomic environment, show the value of the fundamental elements of the GAS NATURAL FENOSA business model, which is based on a good balance between regulated and deregulated businesses in the gas and electricity markets, with continuing growth in international activity, enabling the multinational energy firm to fulfil its 2010-2012 Strategic Plan objectives.

The company’s international operations grew by 22.6% last year and now represent 43.2% of total consolidated EBITDA, compared with 38.5% in the previous year. This growth resulted in a significant increase in gas sales and the development of activity in Latin America. The growing importance of international activities within the business mix fulfilled the guidelines established in the 2010-2012 Strategic Plan.

By contrast, the relative weight of EBITDA generated by operations in Spain decreased in the consolidated total to 56.8%. Regulated gas and electricity distribution activities as a whole represented 51.9% of the company’s EBITDA, while electricity activity represented 23.2% of the total.

Investments totalled 1.386 billion euros, with a decrease of 8.5% with respect to 2011, mainly due to the reduction in regulated investment in Spain. GAS NATURAL FENOSA allocates 65.7% of its investments to gas and electricity distribution regulated activities, which enables it to consolidate the contribution of these activities to consolidated EBITDA.

Geographically, investments in Spain decreased by 11.4%, although the country continues to be the primary receiver of the multinational energy firm’s investments with 63.7% of the total in 2012. International investment represented 36.3% of the rest and grew by 14.4% with respect to the previous year.

Net financial debt decreased by 7.5% in 2012 and totalled 15.995 billion euros at the end of the year, with an indebtedness ratio of 51.8%, compared with 54.5% at December 2011. If the tariff deficit pending recovery is discounted (1.065 billion euros), net debt would have totalled 14.930 billion euros, which would represent an indebtedness ratio of 50.1%. The net financial debt/EBITDA ratio is 3.1. A total of 83.3% of GAS NATURAL FENOSA’s net financial debt matures on or after the year 2015 and its average life is close to five years.

Since the Electricity Deficit Amortisation Fund (in Spanish, FADE) started issuing bonds backed by rights granted from the electricity system in 2011, GAS NATURAL FENOSA received the corresponding part for an aggregated amount of 1.794 billion euros, of which 692 million was received during 2012.

Cash and other equivalent liquid assets, and available bank financing on 31 December brought liquidity to a total of more than 9 billion euros, which covers maturities of longer than 24 months.

Financial instruments available in the capital market at 31 December 2012 totalled 3.699 billion euros During the period, the multinational energy firm made three issues on the European market, for a total amount of 2.050 billion euros, as well as another issue in the Colombian market, where the company is active, for a total amount of 300 billion Colombian pesos.

All this consolidated GAS NATURAL FENOSA’s position as one of the main issuers of capital markets debt, increasing its base of investors and its presence in international financial markets and with an aggregated issued amount under the EMTN program of 10.7 billion euros since June 2009, with an average coupon of 4.8% and an average life of over 7 years.

[mappress]
LNG World News Staff, February 19, 2013; Image: Gas Natural