By Joshua Kirby


Shares in Naturgy Energy Group SA fall Thursday after the company set out first-quarter results showing a decline in net profit amid higher investment that offset rising revenue.

At 1355GMT, shares were down down 6.6% at EUR26.37.

The Spanish energy company made a net profit of 347 million euros ($364.9 million) in the quarter, a decline of 9.4% on the year. Capital expenditure rose by 32% to EUR259 million, with investment notably in the construction of renewable-energy capacity amounting to 582 megawatts, Naturgy said. Net debt rose slightly on the year to EUR13.06 billion.

The higher investment offset a surge in net sales in the quarter, the company booking a 74% increase to EUR8.14 billion. Earnings before interest, taxes, depreciation and amortization rose 9.4% to EUR1.07 billion.

The quarter was marked by varying performance in its different markets, Naturgy said. International activity recovered in the period, but in the company's home market in Spain, margins remained squeezed by contracts that didn't reflect global increases in gas and electricity prices, Naturgy said.

Regulatory changes and other external factors meanwhile affected Naturgy's renewables and generation activities, the company added.

Also Thursday, the Spanish government said it will set a cap on the price of natural gas used for generating electricity in a bid to lower rising power bills. The cap will be set at EUR40 euros a megawatt hour and will remain in place for the next 12 months, Prime Minister Pedro Sanchez said.


Write to Joshua Kirby at joshua.kirby@wsj.com; @joshualeokirby


(END) Dow Jones Newswires

05-12-22 1011ET