EDP (EDP) CMD 2025 summary

Strategic vision and market trends

• Regulatory frameworks in the US, Europe, and Iberia support long-term renewables and network investments, providing visibility and incentives.

• Surging electricity demand, especially from data centers, electrification, and electric vehicles, is driving growth in renewables and networks, with electricity demand expected to grow at a 2-3% CAGR through 2030.

• Major modernization of Iberian networks is required, with 25% of Portuguese transformers over 40 years old, and networks investment is increasing by 40-55% across regions.

• Flexibility and ancillary services are increasingly valuable as renewables penetration rises, with capacity payments in Spain (2026) and Portugal (2027) supporting flexible generation returns.

• Wind, solar, and battery storage are highlighted as the fastest, most scalable, and cost-competitive energy sources, with costs expected to continue declining.

Investment and financial commitments

• €12 billion gross investment planned for 2026–2028, focused on US renewables and Iberian networks, with ~70% allocated to renewables, clients, and energy management, and ~30% to electricity networks.

• €5 billion asset rotation and €1 billion disposals to fund growth and refocus on core markets, supporting capital recycling and portfolio optimization.

• Targeting €5.2 billion EBITDA and €1.3 billion net income by 2028, with a €1 billion net debt reduction and FFO/net debt improving from 19% to 22%.

• Dividend floor to rise to €0.21 by 2028, with payout ratio at 60–70%.

• 60% of renewables investment allocated to the US, up from 50% previously, to capture higher returns.

Operational efficiency and portfolio management

• OpEx/gross profit ratio maintained at 26%, leveraging digitalization, automation, and AI to keep OPEX flat despite inflation and asset growth.

• Asset rotation strategy proven with €13 billion proceeds from 35 transactions over 10 years; normalized capital gains of 15% over invested capital expected.

• 95% of CapEx focused on fewer than 10 markets, 90% in A-rated geographies, and ~80% of EBITDA from A-rated markets.

• Portfolio is highly resilient, with ~80% from regulated or long-term contracted/hedged activities.

• Strong liquidity and conservative funding, with 90% of new debt green or sustainable by 2028 and €9.4 billion in cash and credit lines as of September 2025.