Iberdrola no longer sees impact from Spain’s profit grab By Reuters
Â© Reuters. FILE PHOTO: Iberdrola wind turbines are seen at dusk at the Moranchon wind farm in central Spain, December 17, 2012. REUTERS / Sergio Perez
By Isla Binnie
MADRID (Reuters) – Global wind power leader Iberdrola (OTC 🙂 expects no further impact from Spain’s recent attempt to weigh on utility profits and use them to protect consumers soaring energy prices, the company said on Wednesday.
Electricity and gas prices hit record highs around the world as economies began to recover from the coronavirus crisis, but companies like Iberdrola say they haven’t taken advantage of it because they are fixing the price with customers in advance.
Spain said on Tuesday it would introduce exemptions from a decree that was initially expected to recover around 2.6 billion euros ($ 3 billion) in profits from companies deemed to have profited from the price hike.
Iberdrola shares were rocked by the measures, losing nearly 14% of their value in less than three weeks, but recovered when it became clear the government would change course.
The recovery cost the company 85 million euros.
“This impact will be withdrawn and is not expected to continue in the coming months after the measure adopted by the Spanish government yesterday,” Director General Ignacio Galan said on a conference call.
The stock rose on Wednesday despite the company announcing a 10% drop in net income for the first nine months of the year, in part due to rising purchasing power costs on wholesale markets to meet strong demand.
The result exceeded market expectations for a turbulent nine-month period during which Iberdrola was also hit by an exceptional tax burden in Great Britain, where it operates Scottish Power.
Adjusted for exceptional factors, net profit increased 5.2% year-on-year to 2.7 billion euros.
Government goals to reduce global warming carbon emissions and strong investor appetite for environmentally friendly businesses have supported Iberdrola’s plans to spend 150 billion euros to triple its global energy capacity. renewable by 2030 despite market volatility.
It stuck to its financial forecast for the full year and said it was accelerating the expansion of its offshore wind business, a fast-growing sector that is critical to the decarbonization plans of some of the world’s largest. major economies of the world.
The company now has huge turbines with a combined capacity of 1.5 gigawatts running offshore and is building an additional 2.6 GW in France, the United States and Germany.
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