The General Shareholders’ Meeting of Naturgy endorses the company’s commitment to Energy Transition
- Naturgy, which today operates 4,600 MW of renewable power output, will intensify its investment effort as it currently has a portfolio of more than 300 projects with over 13,000 MW in Spain, Australia, Chile, Mexico and Brazil.
- Additionally, in January 2021, the company agreed the purchase of a renewable project development company in the United States with a portfolio of 8,000 MW in solar energy and almost 4,000 MW in storage.
- Naturgy was recently awarded a total of 235 MW (wind power and photovoltaic) at the renewable energy auction held by the Spanish Government. The award complements its main strategy of arranging long-term PPAs with industrial customers.
- As a result of its commitment to energy transition and economic recovery, Naturgy has identified investment opportunities for a value of almost 14 billion euros in one hundred projects to be developed in the coming years under the Next Generation programme.
- Naturgy is leader in promoting hydrogen projects in Spain with four under development, focused on supporting fair transition, including projects in La Robla (León) and Meirama (Galicia).
- Naturgy highlighted that a realistic and effective approach to the full decarbonisation of the economy requires accelerating electrification, investing in renewable generation and in developing distribution networks, as well as moving forward in the use of renewable gases (hydrogen and biomethane), adapting its transport and distribution infrastructures. Between 2017 and 2020, the company had already reduced its direct CO2 emissions by 30%.
- Throughout the year the company launched a series of measures to help all its stakeholders (employees, customers, suppliers and society in general) relieve the effects of the pandemic.
- Shareholders approved the management of the company’s Board of Directors and financial statements for 2020, which met forecasts for ordinary results despite the complicated environment, marked by reduced demand on all markets, falling energy indexes and devaluation of Latin American currencies. The value of gas distribution assets in Argentina and thermal generation assets in Spain was also reviewed, adapting them to the circumstances.
- Naturgy continued to optimise its portfolio and this week will close an agreement to resolve the complex situation of its investments in Egypt, which has extended since 2012. The electricity business in Chile is also expected to be sold during the first six months of the year.
- The company has also improved its exposure and commitments to purchasing gas in order to reduce both their size and risk profile; purchase commitments have been reduced by 30% and reference indexes have been balanced.
- The Shareholders’ Meeting approved a complementary dividend of €0.63/share in line with the 2018 Strategic Plan; this dividend will be paid on 17 March.
Naturgy Chairman and CEO, Francisco Reynés, chaired the company’s Ordinary General Shareholders’ Meeting, held today in Madrid online as a result of mobility restrictions and to maintain safety due to Covid-19. Shareholders approved the company’s results and management report for 2020, as well as a complementary dividend of €0.63/share, which will be paid on 17 March.
“It has been a complex year, with a very challenging macro and energy environment, which we have overcome thanks to active management of our activities and a clear commitment to financial and operational optimisation. Naturgy continues to work on its strategic pillars, with a very dynamic management and in order to play a key role in the energy transition, as well as the economic recovery of the country”, said Naturgy Chairman Francisco Reynés.
Over the last year, Naturgy has proven to be an active agent in the energy transition. Proof of this was its role in presenting the calls of interest to identify traction projects for economic recovery as part of European funds allocated to energy transition. The company has identified investment opportunities for a value of almost 14 billion euros in one hundred projects to be developed in the coming years under the Next Generation programme.
In this vein, Naturgy is leader in promoting hydrogen projects in Spain with four under development, focused on supporting fair transition, including projects in La Robla (León) and Meirama (A Coruña), with 30 MW and 50 MW respectively. In this way, the company seeks to develop a green economy that will also create jobs in rural or unpopulated areas.
Francisco Reynés stated that “a realistic and effective approach to the full decarbonisation of the economy requires accelerating electrification, investing in renewable generation and in developing distribution networks, as well as moving forward in the use of renewable gases, hydrogen and biomethane, and thus adapting transport and distribution infrastructures”.
Regarding the takeover bid presented by IFM, Naturgy ratified that the company’s Board of Directors would issue a statement “when appropriate and legally mandatory, and while the company maintains the momentum of its daily activity and dynamics in all areas of activity”.
The General Shareholders' Meeting reached a quorum of 82.4% and almost 1,000 people were connected online.
Commitment to energy transition
Naturgy is now facing a new phase of transformation after becoming a more simple and efficient company, with greater discipline assigning capital. The company will focus its efforts on growth in the renewable energies market, and in stable geographic areas with strong currencies. Naturgy, which today operates 4,600 MW of renewable power output, will intensify its investment effort as it currently has a portfolio of more than 300 projects totalling over 13,000 MW in Spain, Australia, Chile, Mexico and Brazil. Additionally, in January 2021, the company agreed the purchase of Hamel Renewables, a renewable project development company in the United States with a portfolio of 8,000 MW in solar energy and almost 4,000 MW in storage.
He also highlighted the positive outcome of the auction held in Spain, where the company was awarded a total of 235 MW between wind and solar photovoltaic technologies. The award at this auction completes Naturgy’s commercial strategy, which primarily aims to agree long-term renewable energy purchase agreements (PPAs) with industrial customers.
Over 2020, Naturgy made significant progress in Australia, which has become a key region for the company thanks to the recent agreements reached that will increase its renewable capacity in this country to 700 MW. Specifically, the group has the wind farms 'Ryan Corner' and 'Berrybank’ in Australia, added to 'Crookwell’, which is currently operational.
“In 2012 alone, the company will focus on developing renewable projects for more than 1 billion euros to continue transforming our business towards a more sustainable energy mix. And the company will not stop looking for new opportunities that create value for our shareholders”, highlighted Francisco Reynés.
Meanwhile, in addition to growth and creating value, the group’s priority lines of management also revolve around maintaining the reduced risk profile by optimising its portfolio, highlighting the divestment of 96.04% of its stake in Chilean company CGE for a value of over 4.3 billion (EV), confirming the company’s capacity to create value for its shareholders. The operation is expected to be closed during the first half of this year.
Also worthy of note is the agreement reached with ENI and the Egyptian Government regarding business in Egypt with the operation expected to be closed this week, thus resolving a complex situation that has extended since 2012.
The company has also improved its exposure and commitments to purchasing gas in order to reduce both their size and risk profile. Specifically, purchase commitments have been reduced by 30% and reference indexes balanced.
In line with its commitment to transparency and in order to provide an evaluation adapted to forecasts for the current energy scenario, during the last quarter the company reviewed the evaluation of certain assets which led to an impact of 1.363 billion euros, mainly affecting conventional power generation in Spain (1.145 billion euros) and gas activities in Argentina (198 million).
Naturgy continued its social work last year and was one of the most dynamic companies in launching a series of measures to help all its stakeholders (employees, customers, suppliers and society in general) relieve the effects of the pandemic. These measures include deferring bills or free power supply to medicalised hotels and residences.
Progress in ESG
The company made significant progress in its environment, social and corporate governance objectives (ESG) during the year. Significant effort has been made in recent years as between 2017 and 2020 the company has reduced its direct CO2 emissions by 30%. Specifically, last year the group continued to reduce greenhouse gas emissions (-7%) and emissions-free installed capacity continued on the rise (+10%).
Over the year, the company added 685 million euros in investment and expenses allocated to environmental actions around the world and activated around 270 initiatives related to biodiversity, as well as actions in vulnerable homes through its Foundation, which in 2020 exceeded 700 energy refurbishments in Spain.
All the company’s actions in recent years have enabled Naturgy to become highly qualified and valued in various international indexes analysing the environmental and social commitment of companies. Thus, in 2020 Naturgy obtained global leadership in the Multiutilities sector for the second year in a row, and renewed its top spots in the DJSI World and DJSI Europe indexes for the gas utilities sector. Furthermore, according to the EuroNextVigeo index, Naturgy is one of the top 120 sustainable companies in the world, Europe and Eurozone; while it has remained in the top spots of the CDP A List since 2011.
Madrid, 9 March 2021