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Iberdrola / ScottishPower H1 Results 2017


Iberdrola investment in the first half reaches €2.512 billion (+ 35%)

  • Iberdrola continued to expand investments to €2.512 billion during the first six months of 2017, up 35% from the same period the previous year. Out of that amount, over 91% was allocated to networks, renewables and long-term generation contracts.
  • Iberdrola posted a net profit of €1.518 billion in the first half of 2017, an increase of 4.2% over the same period in the previous year.
  • Net operating profit (EBITDA) attained €3.752 billion, down 3.6% year on year. Compared to the 8.2% decrease in the first quarter of 2017, Ebitda shows signs of recovery throughout the year. Of the total amount, more than 80% comes from regulated businesses or from long-term contracts.
  • Group revenue reached €15.167 billion euros, up 1.8% year on year while gross margin was €6.851 billion, up 1.1%. Operating cash flow was €3.275 billion, up 1.7%, with taxes growing 13% to €1.156 billion.

ScottishPower Results

SP Energy Networks:

  • EBITDA: £388.0m - compared to £405.5m H1 2016 (down 4%)

Returns for SP Energy Networks are largely on target, set by the phasing of investments following the implementation of the RIIO-ED1 distribution investment programme which started in April 2015. This programme is delivering over £4 billion of investment in the distribution network up until 2023.

Generation and Supply:

  • EBITDA: £48.8m - compared to £205.9m H1 2016 (down 76%)

The Generation and Supply business has been impacted by milder weather conditions in the first half of 2017. In Retail, domestic power sales were down by approximately 7% and domestic gas sales down by around 8%. Thermal generation in the United Kingdom also fell by 40% during the first half of 2017 to 3,581 GWh, compared with 5,923 GWh in the previous year, due largely to the closure of Longannet Power Station. ScottishPower has approximately 5.3 million customer accounts, compared to 5.4 million in the first half of 2016.

ScottishPower Renewables:

  • EBITDA: £153.7m - compared to £116.6m H1 2016 (up 32%)

Onshore wind production increased to 1,701 GWh, 43.8% higher than that recorded in the first half of 2016. This is driven by a mixture of better wind conditions, and also increased capacity, as a £650 million project to install eight new onshore windfarms has progressed. Offshore wind production also increased by 13.9%, amounting to 387 GWh, driven by better wind conditions.

Commenting on the results, Keith Anderson, ScottishPower Chief Corporate Officer, said:

“Investment continues at pace in major infrastructure. We are nearing the completion of a £650 million programme to deliver eight new onshore windfarms and we are starting full construction of the £2.5 billion East Anglia ONE offshore windfarm. As part of our 2016 to 2020 business plan, ScottishPower is overseeing around £4 million of investment every day.

“The Renewables business has performed well in the first half of the year, and we have seen increased production across both onshore and offshore wind. As well as progressing the construction of the East Anglia ONE offshore windfarm in the second half of the year, we also hope to have a planning decision on the proposed 1,200MW East Anglia THREE offshore wind project later in the summer.

“Our Networks business remains on course to meet the objectives of its current regulatory agreements and now has over 3.5 million supply points. Major infrastructure upgrade projects are also being delivered across the distribution and transmission networks.

“The closure of Longannet in March 2016 coupled with milder weather in the first half of the year has influenced the year-on-year figures for Generation and Supply.

“In Thermal Generation, UK returns remain tight highlighting the need for reforms to the capacity market auction process.  The next auction urgently needs to deliver new large-scale gas plant. The economics need to be right for investors to build this much needed new plant.

“In Retail, we have seen fierce competition in the UK and we expect this to continue for the foreseeable future.  Even with this backdrop, our customer numbers are stable and we have still retained more of our customers over the last 5 years than any other large supplier.

“We will continue to work hard to offer customers good value products, and continue to lead the large suppliers in encouraging customers to move away from standard tariffs. Abolishing standard tariffs is more effective than any price cap in ensuring more customers are on the best value deals for them."

To view Iberdrola's full press release and supporting documentation, please click the links below:

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