EDP Renováveis (EDPR) Q2 2024 earnings summary

Executive summary

• Renewable generation increased 5% year-on-year to 19 TWh, driven by wind recovery and new capacity, with 2.9 GW added and 4.5 GW under construction, mainly in North America and Europe.

• EBITDA rose 26% year-on-year to €960m, supported by €171m asset rotation gains and efficiency improvements; net profit reached €210m, up from €102m in 1H23.

• Asset rotation program delivered 0.8 GW rotated in 1H24, generating €1.2bn in proceeds and an average EV/MW of €1.6m.

• 1.3 GW of PPAs signed in H1, over 60% with major global tech companies, providing long-term revenue visibility.

• Expansion capex totaled €2.3bn (+18% YoY), with 84% invested in North America and Europe, focused on solar and storage.

Financial highlights

• Electricity sales rose 5% year-on-year to €1,145m, supported by higher generation and stable average selling price of €61/MWh.

• Core OpEx per average MW in operation decreased 8% year-on-year to €24.3k, reflecting ongoing efficiency gains.

• EBITDA margin improved to 79% (from 62% YoY), with EBITDA at €960m (+26% YoY) and net profit at €210m.

• Net debt stood at €7.5bn as of June 2024, up €1.7bn from December 2023, mainly due to €2.3bn in expansion CapEx.

• Net financial expenses rose 40% YoY to €223m, mainly due to higher nominal debt and negative hedging impacts in Colombia.

Outlook and guidance

• 2024 average selling price expected at the higher end of guidance (~€55/MWh), supported by hedging, despite lower generation volumes due to weak wind in Brazil.

• Capacity additions guidance of 3.5–4 GW for 2024 reaffirmed, with installations expected to be backloaded in H2.

• Net income target of €400m for 2024 maintained, with expectations of a stronger second half.

• More asset rotation and tax equity proceeds are expected by year-end, which should help offset investment-driven net debt increases.

• 2025–26 forward prices and business assumptions remain aligned with previous guidance.