ENDESA S A : increased its ordinary net profit by 38%, relying on the resilience of its integrated business against Covid

• The ordinary net result reached 1.7 billion in the first nine months of the year. Endesa has kept to its financial and dividend targets for the year as a whole
• The company estimates an impact of 81 million in ebitda as a result of the pandemic so far this year. Despite this, this level has increased by 8% year-on-year to 3.136 billion
• The comprehensive management of the electricity business allows Endesa to mitigate the drop in electricity demand (-6% on average in the Iberian Peninsula) and in wholesale electricity prices (-36% compared to the same period in 2019).
• The growth in the production of energy with renewable sources meant that between January and September (excluding non-peninsular territories) the objective of generating 85% of electricity without CO2 emissions was met, a goal that was set for 2022.

Endesa has managed to weather the effects of the coronavirus pandemic, as well as the growing competition in the deregulated business (which includes peninsular generation, commercialisation, services, adjustments and costs), in the first nine months of this year. The company remains committed to meeting the financial targets set for 2020, while making progress in the process of decarbonisation and growth of the renewable energy fleet in both Spain and Portugal.

The energy group obtained an ordinary net profit of 1.7 billion euros between January and September, 38.4% more than in the same period of the previous year. This figure was affected by the net effect of the reversal of the provision for certain social benefits due to the application of the new collective agreement (which contributed 515 million to the gross operating profit (EBITDA) and 386 million to the net result). And, on the other hand, the impact of the provision for staff cuts recorded in the first quarter (which deducted 159 million from EBITDA and 119 million from net profit). In other words, both items contributed a total of 356 million to EBITDA and 267 million to net income.

This healthy performance is supported, on the one hand, by the 8.2% increase in EBITDA, reaching 3.136 billion. The estimated impact of the covid on this magnitude amounts to 81 million up to September, only one million euros more than at the end of the first half of the year. And, on the other hand, by the decrease in provisions compared to the same period of 2019 by 57%, to 1.104 billion. Last year, Endesa discontinued its coal business in the Iberian Peninsula, which was a huge loss.