SHAREHOLDER
NEWSLETTER
No. 41 – MAY 2013
NET PROFIT STANDS
AT EuR 878,6 MILLION
POSITIVE OPERATING PERFORMANCE
OF BuSINESSES
Chairman’s Letter
Dear Shareholder:
I am once again addressing you to present the earnings for the first
quarter of 2013, a period characterised by the positive operating
performance of the Group’s businesses, despite the difficult
economic environment.
Gross Margin has increased by 5.5% to E3,573 million, thanks
primarily to the positive performance of the Renewable Energy
and Generation and Supply businesses. Moreover, efficiency has
improved by 4.6%, as a result of the programmes implemented by the
Company in this area over the last financial year.
However, several impacts have adversely affected the earnings for
the first quarter, including: the energy extra cost registered in Brazil
due to the drought in that country; the higher expenses associated
with the efficiency programmes in the United Kingdom; and the
heavier tax burden in Spain and the United Kingdom, which for the first time has exceeded the Company’s
personnel expenses.
These circumstances explain the slight decline in EBITDA to E2,279 million (down 3.7%), as well as the
reduction in net profit, which stands at E879 million (down 14.1%).
It is important to point out that the Company expects to reverse some of the exceptional impacts over the
coming months; excluding their effect, EBITDA would have been similar to the figure posted in the first quarter
of 2012 and net profit would have grown by nearly 3%.
The Group has continued to reinforce its financial soundness, in line with the outlook for the 2012-2014 period,
and has already reduced its net debt by E2,000 million, improving its leverage to 46.1%. Moreover, it has
liquidity in excess of E12,200 million, an amount that covers the Company’s financing needs for the next three
years.
As for the closing of this financial year, the Company expects to maintain its EBITDA and net profit at levels
similar to those registered in 2012, which will enable it to maintain the current shareholder remuneration
policy.
I would like to express my sincere gratitude to each and every shareholder for their support during the last
General Shareholders’ Meeting held on 22 March in Bilbao. Of particular note is the quorum reached (over 81%),
as well as the fact that all the proposals submitted were passed by an overwhelming majority, with only 1.4%
of the votes against in some of the proposals.
The Meeting approved the Company’s financial statements for 2012 and total shareholder remuneration of
E0.3 per share, which will be added to the E0.005 attendance bonus. After the E0.143 already paid in January,
E0.157 will be paid out in July (E0.03 in cash and E0.127 through a new scrip dividend programme).
Once again I would like to thank you for your support and trust, which encourage us to continue to turn
Iberdrola into a company increasingly sustainable, responsible and committed to its shareholders, employees,
customers, suppliers and communities where we operate.
Ignacio Galán
Chairman of Iberdrola
2013 General Shareholders’ Meeting
Iberdrola would like to express its sincere gratitude for the support received
at the General Shareholders’ Meeting held on 22 March
The IBERDROLA General Shareholders’ Meeting held on 22 March 2013 was attended by a total of
5,093,656,651 shares (995,647,513 present and 4,098,009,138 represented), with a quorum of 81.09% of
the share capital (15.85% present and 65.24% represented).
All the proposals submitted by the Board of Directors were approved by a large majority of
shareholders (over 78% of the quorum).
New shareholder remuneration scheme approved
As a result of the financial strengthening and the earnings posted in 2012, the Board of Directors of
Iberdrola proposed in item five of the agenda total shareholder remuneration of approximately
E0.305 per share.
Thus, the E0.143 paid in January will be increased by at least an additional E0.157 in July, of which E0.03
will be paid in cash and E0.127 through a new scrip dividend.
The E0.005 Meeting attendance bonus already paid should be added to these figures.
86.3% of the shareholders present or represented holding a total of 4,395,745,596 approved the proposed
remuneration.
For more information on the Meeting, please visit: www.iberdrola.es
Highlights
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Net Production by Technolgy
Net Output totalled 36,221 GWh
The difficult macroeconomic situation and weak
demand in the Eurozone have reduced output
by 5.6%.
The heavy rainfall and favourable wind
conditions in Spain had a positive impact on the
quarter’s earnings.
Renewables
+17.0% 28% Cogeneration
­6.2%
Hydro
+65.0%
14% Nuclear
17% ­13.7%
10% 5% Coal
­28.0%
26% CCGT
­23.9% Gross Margin by Business
Others
Generación
y Comercial
+11.1%
1%
41%
34%
4%
Mexico
Reg. generation
Gross Margin stands at E3,573
million (up 5.5%)
Renewables
+20.1%
Networks
­5.8% 20%
­­­ Regulated Businesses
+1.6%
Gross Margin increased by 5.5% thanks to
the positive operating performance of the
businesses.
This increase was driven by the Renewable
Energy (+20.1%) and Generation and Supply
(+11.1%) businesses, which offset the impact of
the Networks business in Brazil, affected by the
drought.
1. Including: Networks (61%), Mexico Reg. generation (1%) and
Renewables (23%) Operating efficiency improved by
4.6%
NOE/Gross Margin
25.9%
­4.6%
24.7%
The efficiency ratios have improved thanks to the
efficiency measures implemented in 2012.
Thus, net operating expense on net profit has
been reduced by 4.6%.
Q1 2012
Q1 2013
Levies1 (Eur M )
EBITDA and Net Profit were
affected by tax hikes in Spain
and the United Kingdom and
by the one-off impact of the
drought in Brazil
464 +62% 286 The improvements in Gross Margin and
efficiency were absorbed by the tax hikes
(+62%), not including Corporation Tax.
In Spain and the United Kingdom, taxes exceed
personnel expenses by 30%.
Q1 2012
Q1 2013
1. Levies impacting on EBITDA, not including Corporación Tax, and
eliminating the impact of Courts rulings. Recurring Net Profit amounts to E889 million (down 4.8%)
As a result of the above, Recurring Net Profit is down 4.8%, while Reported Net Profit has declined
14.1% to E878.6 million.
Recurring Net Profit (Eur M)
933.7
­4.8% Q1 2012
Reported Net Profit
(Eur M)
1,022.3 889.0
Q1 2013 Q1 2012 ­14.1% 878.6 Q1 2013
Leverage
Increased financial soundness
48.5%
46.1%
1.6%
1.6%
46.9%
44.5%
Thanks to adequate financial management,
Adjusted Net Debt has been reduced by E2,000
million to E29,700 million, despite maintaining
a similar level of tariff deficit and in spite of the
slight increase in the cost of debt.
Leverage stands at 46.1% including the tariff
deficit, compared to 48.5% in the same period
last year.
Q1 2013
Q1 2012
Tariff Deficit
A strong liquidity position
Liquidity totals E12,261 million, enough to cover the Company’s financial needs for three years.
Eur M
Limit
Withdrawn
Available
2013 1,300
48
1,252
2014
2,686
59
2,627
2015 & onwards 5,233
60
5,173
Total Credit Lines 9,219
167
9,052
Credit Line Maturities
Cash & Short Term Fin. Invest.
3,209
Total Adjusted Liquidity
12,261
Outlook for 2012-2014
Under current conditions, Iberdrola will continue to meet the goals set out in the announced Outlook for
2012-2014, maintaining the shareholder remuneration policy.
2012
2013
2014
Net Debt
Eur 30.3 bn < Eur 28 bn
_ Eur 26 bn
~ EBITDA and
Net Profit
~_ +1%
Between 0% and ­5%
vs. 2012
Maintain vs. 2011
Shareholder
Remuneration
Policy1 Average
Eur 0.3/share
Average
Eur 0.3/share
Average
Eur 0.3/share
1. Subject to approval at the AGM ­1
3 pr
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ar
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2 30
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2 IBERDROLA’s share price performance
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IBERDROlA shares
Q1 2013
Q1 2012
6,281,184,000
5,972,865,000
Price at end of period
3.63
4.25
Average share price in the period
3.90
4.54
41,189,836
35,942,256
Maximum volume (03-25-2013 / 03-15-2012)
162,437,325
117,420,585
Minimum volume (01-29-2013 / 02-15-2012)
11,613,980
13,072,644
0.143
0.146
0.143 (1)
0.146 (1)
9.31%
7.93%
Number of shares outstanding
Average daily volume
Dividends paid (E)
Gross interim (01-22-2013/01-20-2012)
Dividend yield (2)
(1) Iberdrola-guaranteed rights purchase price.
(2) Last interim and final dividend paid and Shareholder’s Meeting attendance bonus/closing share price.
Datos Bursátiles
Market capitalisation
Earnings per share (6,281,184,000 shares as of 03/31/13 and 5,972,865,000 shares as of
03/31/2012)
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Net operating cash flow per share
Q12013
Q1 2012
22,820
25,426
E
0.140
0.171
E
0.282
0.305
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MME
LEGAL NOTICE
DISCLAIMER
This document has been prepared by Iberdrola, S.A. solely for use during the presentation of the results of the first quarter of accounting year 2013. As a result, it may not be disclosed or made public or used by any other natural or legal person for purposes other than those set forth above without the express and written consent of Iberdrola, S.A.
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Iberdrola, S.A. shall not be held liable for this document’s content if it is used for any purpose other than that expressed above.
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The information and all the statements contained in this document have not been verified by independent third parties; therefore no express or implied warranty is made as to the impartiality, accuracy, completeness or correctness of the information or the opinions and statements expressed herein.
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Neither Iberdrola, S.A. nor its subsidiaries or other companies of the Iberdrola Group or companies in which Iberdrola, S.A. holds an interest shall be held liable, whether for negligence or any other reason, for any damage or loss arising from any use of this document or its content.
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Neither this document nor any part of it constitutes a contract, nor may it be used for incorporation into or interpretation of any contract or other type of agreement.
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The information contained herein on the price at which securities issued by Iberdrola, S.A. have been bought or sold or on the performance of those securities cannot be used to predict the future performance of securities issued by Iberdrola, S.A.
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IMPORTANT INFORMATION
This document does not constitute an offer or invitation to purchase or subscribe shares, in accordance with the provisions of the Spanish Securities Market Act (Act 24/1988, of 28 July), Royal Decree Act 5/2005, of 11 March, and/or Royal Decree 1310/2005, of 4 November, and its implementing regulations.
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Moreover, this document does not constitute an offer of purchase, sale or exchange, or a request for an offer of purchase, sale or exchange of securities, or a request for any vote or approval in any other jurisdiction.
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Iberdrola, S.A. shares may not be offered or sold in the United States of America, unless such an offer or sale is made pursuant to an effective registration statement under the Securities Act of 1933 or pursuant to a valid exemption from registration.
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FORWARD-LOOKING STATEMENTS
This communication contains forward-looking information and statements about Iberdrola, S.A. These forward-looking statements include certain
financial projections and estimates and their underlying assumptions, statements in relation to the plans, targets and expectations regarding future
operations, investments, synergies, products and services, and statements regarding future performance. These forward-looking statements do
not constitute historical facts and can generally be identified by the use of terms such as “expects,” “anticipates”, “believes”, “plans”, “estimates” and
similar expressions.
Although Iberdrola, S.A. believes that the expectations reflected in such forward-looking statements are reasonable, investors and shareholders
in Iberdrola, S.A. are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which
are difficult to predict and generally beyond the control of Iberdrola, S.A., that could cause actual results and developments to differ materially
from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include those
discussed or identified in the public documents sent by Iberdrola, S.A. to the Comisión Nacional del Mercado de Valores (the Spanish securities
regulator, or the CNMV for its initials in Spanish).
The forward-looking statements are no guarantee whatsoever of future results and have not been reviewed by the auditors of Iberdrola, S.A. You are
cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date they were made. All subsequent oral or
written forward-looking statements attributable to Iberdrola, S.A. or any of its directors, officers, employees or any persons acting on its behalf are
expressly qualified in their entirety by the cautionary statement above. All forward-looking statements included herein are based on information
available to Iberdrola, S.A. on the date hereof. Except as required by applicable law, Iberdrola, S.A. does not undertake any obligation to publicly
update or revise any forward-looking statements, even in the event of new information being published or new events occurring.
Toll-free number for shareholders (in Spain)
900 10 00 19
Number for Shareholders (UK)
(0) 871 384 2936
Calls to this number are charged at 8p per
minute from a BT landline. Other telephony
providers costs may vary
Number for Shareholders (US)
Tel: 1 (866) 726 8237 (toll free)
E-mail
[email protected]
Web site
www.iberdrola.com