Societatea Energetica Electrica (EL) Q4 2024 earnings summary

Executive summary

• 2024 IFRS consolidated net profit was RON 389.6 million, 34.6% above budget but down 49.5% year-over-year, reflecting strong performance despite a complex regulatory and economic environment.

• Operational revenues reached RON 10.68 billion (IFRS), up 1.5% over budget but down 8.4% year-over-year; EBITDA was RON 1.36 billion, up 3.5% over projections but down 20.6% year-over-year.

• Distribution segment revenues rose 6.8% year-over-year, driven by higher tariffs and increased distributed volumes (+4.2%), while supply segment revenues declined 13.1% due to lower volumes and regulatory adjustments.

• Major investments in renewables and infrastructure modernization advanced, with over 112% of planned investments executed and ~300 MW renewable capacity in development.

• Fitch Ratings upgraded outlook to stable in March 2025, supporting green bond issuance plans.

Financial highlights

• Net profit: RON 389.6 million (IFRS) for 2024, 34.6% above budget, down 49.5% year-over-year.

• EBITDA: RON 1.36 billion, up 3.5% over budget, down 20.6% year-over-year.

• Operational revenues: RON 10.68 billion, up 1.5% from budget, down 8.4% year-over-year.

• Net debt at year-end: RON 4.4 billion, expected to decrease as support scheme winds down in 2025.

• Dividend payout ratio for 2024 at 100%, with gross dividend per share proposed at RON 0.1767.

Outlook and guidance

• Cautiously optimistic for 2025, focusing on exceeding investment objectives and sustainable growth.

• Targeting 1 GW renewable production and 900 MW storage by 2030; currently developing 300 MW capacity.

• Investment plan of at least RON 3.7 billion over the next five years, focused on grid modernization and renewables.

• Plans to recover unbilled receivables and resolve auditor's qualified opinion by April 2025.

• Regulatory changes to support smart grid, energy storage, and digitalization initiatives.