Naturgy succeeded in 2024 to consolidate the historic result it achieved in 2023. The company posted a net profit of 1.901 billion euros, while the group’s EBITDA stood at 5.365 million euros, driven by good business performance and efficient operational management in the face of external factors. This result illustrates the group’ ability in continuing to create value in a much more demanding energy context, with energy prices falling by 30%.
Naturgy made a significant investment effort throughout the year, in line with its strategy for transformation and promotion of the energy transition. The company invested 2.28 billion euros to strengthen the electricity and gas energy infrastructure, which is key to furthering energy transition, and into its strong commitment to renewable energy generation. The group combined its growth and transformation with its characteristic financial discipline. Net debt stood at 12.201 billion euros, with a net debt-to-EBITDA ratio of 2.3x, whereas available liquidity exceeded 11 billion euros.
“The good results for 2024 reflect the commitment, professional quality and good performance of the entire Naturgy team to respond to the great challenges facing the energy sector. Naturgy continued to grow and transform its business model in the course of 2024, driving energy transition without neglecting supply security, and through prudent financial management,” explained Naturgy’s executive chairman, Francisco Reynés.
Delivery of the 2021–2024 Strategic Plan
Naturgy has completed the 2021 – 2024 Strategic Plan with a high degree of value creation for shareholders. Total Return for shareholders (TSR) between 2021 and 2024 was 11.5%, compared to 4.8% in the EuroStoxx Utilities index. By the end of 2024, ROIC was 11.1%, an increase of more than 400 basis points over the Plan baseline, while ROE closed the year at 14.6%, an improvement of more than 250 basis points over 2021.
In this period, Naturgy invested an average of 2 billion euros each year, focusing on the growth and transformation of the business. These investments have enabled the installed generation capacity to be increased to 20 GW, half of which is emission-free. Moreover, OPEX were reduced by 10% in the same period resulting from continuous improvements in processes efficiency and cost savings.
The company continued to make progress in the field of ESG. Governance was the year’s main focus owing to the enforcement of the European Sustainability Reporting Standards (ESRS). Despite the CSRD Directive not having been transposed into Spanish law, Naturgy followed the joint recommendation of the CNMV and the ICAC to implement the ESRS while simultaneously complying with Spanish Law 11/2018 governing reporting of non-financial and diversity information. In terms of the environment, the company reduced its carbon footprint by 27% for all three scopes compared to 2017, the baseline year.
A new Strategic Plan adapted to an uncertain context
Naturgy faces a new period of energy price volatility. The market foresees a scenario where gas prices rebalance to the levels seen prior to the Ukraine crisis, with a gradual decline to levels of about 30 euros/MWh, more than 35% below the current level, which is likely to impact the electricity market. This price environment makes caution advisable when selecting investments.
Even with this demanding scenario, Naturgy estimates an average annual EBITDA of 5.3 billion euros and an average annual net profit of around 1.9 billion euros.
Compared to the previous three-year period, the company foresees an increase in investments of around 10%, totalling 6.4 billion euros, not including potential inorganic growth opportunities. Of these investments, 50% are earmarked for the Networks business and 30% for the development of renewable projects. Spain will account for 75% of investments, compared to 55% previously.
The new Strategic Plan maintains the company’s commitment to sustainability and will continue to drive efforts to reduce emissions, support biodiversity and improve natural capital. Regarding the remaining objectives, the company has set itself the goal of having 40% percent of women in of management positions and extending its high sustainability standards to practically the entire supply chain.
The robustness of the expected results, the company’s efficiency, and a healthy balance sheet allow the Strategic Plan to include the gradual improvement in the dividend from 1.6 euros per share in 2024 to 1.9 euros per share in 2027.
The Board of Directors unanimously endorsed this new Strategic Plan and the management team, urging them to continue their efforts to adapt the business model to the demanding circumstances of the energy markets and to meeting energy transition milestones.
Improving the company’s free float
The Board of Directors has also unanimously decided to put forward a proposal to the General Shareholders Meeting for a voluntary tender offer that will enable Naturgy to acquire up to 10% of its share capital for the purpose of re-establishing an adequate free float that will enable the company to return to the main stock market indices, particularly MSCI.
The tender offer will have a price of 26.5 euros per share and all reference shareholders are expected to participate in the offer in proportion to their shareholding.
The process of returning repurchased shares to the market will be managed by Naturgy itself, flexibly and without a specific timetable, which will financially optimise the transaction.
Restructuring of the Board of Directors
The Board of Directors of Naturgy has also unanimously agreed to forward a proposal to the General Meeting of Shareholders to modify the number of board members to 16, in accordance with the principle of proportional representation. This increases the number of proprietary directors for each core shareholder by one new member, while leaving the number of independent directors unchanged. In addition, progress is being made towards achieving equal representation goals.
The resulting Board of Directors will have the following composition:
- CriteriaCaixa will have four proprietary directors
- GIP/BlackRock will have three proprietary directors
- Rioja/CVC will have three proprietary directors
- IFM will have two proprietary board members
- Three independent directors
- One executive chairman
The Board of Directors will also propose to the General Meeting of Shareholders the re-election of those directors whose terms of office have expired:
- Isabel Estapé, on behalf of CriteriaCaixa
- Raj Rao and Lucy Chadwick, on behalf of GIP/BlackRock
- Javier de Jaime, on behalf of Rioja/CVC
- Helena Herrero, as an independent director
And the appointment of the following new directors:
- María Isabel Gabarró, on behalf of CriteriaCaixa
- Martin Catchpole, on behalf of GIP/BlackRock
- Marta Martínez, on behalf of Rioja/CVC
- Nicolás Villén, on behalf of IFM
Convening the Annual General Meeting of Shareholders
The Board has agreed to convene the Annual General Meeting of Shareholders on 25 March at the company’s headquarters in Avenida de América, Madrid, where all resolutions arising from the new Strategic Plan and the new composition of the Board will be submitted for ratification.
A proposal will also be put forward at the meeting for a final dividend of 0.6 euro per share. This amount, together with the interim dividend paid during the remainder of the year, adds up to a dividend of 1.6 euros per share against 2024 results.
