REN closes 2019 with a net profit of 118.9 Million

Renewable production at record levels

• Photovoltaic generation surpassed 1 TWh of annual production for the first time
• Renewable production supplied 51% of domestic electricity consumption 
• Lowest share of coal since the opening of the Sines power station
• Usage of the Sines LNG terminal was the highest ever 
• Service quality remains among the best at the international level
• Operations in Chile contribute positively to results
• Net profit increases to €118.9 million
• Average cost of debt down to 2.1%

REN - Redes Energéticas Nacionais had a net profit of €118.9 million in 2019, up 2.8% year-over-year, with a recurring net profit of €144.8 million, up 5.5%. These results were due to improved financial results and the positive contribution from operations in Chile. 

The average cost of debt upheld the downward trend from 2013 at 2.1% in 2019, compared to 2.2% in 2018. Despite this positive scenario, the payment of the Energy Sector Extraordinary Contribution (CESE) - whose effective tax rate rose to 40% - continues to have a major impact on REN's results. Net debt increased 6.5% to €2.826 million due to the acquisition of Transemel in October.

The EBITDA was €486.2 million, down 1.2% (€6 million), resulting from a lower gross annual income remuneration (down €11.4 million), due to the reduction in interest rates on Treasury Bonds and on the Regulated Asset Base. These amounts were partially offset by the improved results of Electrogas and the consolidation of Transemel.
 
CAPEX and transfers to operations increased €66.6 million and €102.2 million to €188.6 million and €190.6 million, respectively. The electricity sector accounted for 74.7% and 79.6% of the total, respectively.

2019 was marked by the acquisition of the Chilean company Transemel, which joined the investment made in 2017 of a 42.5% stake in Electrogas. These acquisitions are part of REN's Strategic Plan, which has a conservative growth strategy. This small uptick in the company's internationalisation will not change REN's main priority, which is operations in Portugal.

In view of the 2019 results, REN's Board of Directors will propose payment of a dividend of 17.1 cents per share to the General Shareholders' Meeting of 07 May. This amount is in line with practices in previous years, and with REN's dividend policy.   

All-time highs characterised 2019
In terms of operations, in addition to upholding the usual high standards in service, 2019 saw historical records in domestic production: maximum daily domestic wind production on 22 November was 103.8 GWh, reaching a maximum output of 4667 MW on the same day. In photovoltaic generation, with around 730 MW installed at year's end, the peak has exceeded 500 MW of maximum power for the first time. These figures demonstrate the growing weight of renewable energy sources, reflecting the priorities of the energy transition policy.
 
Renewable production supplied 51% of domestic electricity consumption in 2019, with wind power accounting for 26% of consumption - the highest share ever for this technology - hydropower for 17%, biomass for 5.5% and photovoltaics for 2.1%.  Photovoltaics had the highest percentage growth in 2019, surpassing 1 TWh of annual production for the first time.  
 
As for non-renewable production, it supplied 42% of consumption in 2019, broken down between natural gas with 32% and coal with 10%, its lowest share since 1989. The foreign trade balance, after three years of exporting, favoured importing, supplying 7% of domestic consumption.
 
Natural gas consumption amounted to 67.9 TWh, with an annual variation of 4.8%. This is the second highest annual consumption ever, 2.5% below 2017.  In the electricity market segment, which accounted for 35% of total consumption, there was a growth of 14.6% over the previous year, while in the conventional segment there was a trend of stabilisation with a marginal growth of 0.2%. 
 
Also, the use of the Sines LNG terminal was the highest ever, with the operation of 66 ships. It was also in 2019, on 10 January, that for the first time in 22 years the National Natural Gas System exported natural gas through the Campo Maior interconnection. On that day, the total flow of gas in the VIP Ibérico (the virtual point that combines the capacities of the international interconnections) to supply the Spanish system was approximately one million cubic metres, having been almost fully transported through the Campo Maior interconnection. 
 
On 12 July, to ensure a balance between production and consumption, REN launched a pilot project for the participation of consumption in the adjustment reserve market. 
 
REN's Datacentre in Riba de Ave received the first supercomputer to operate in Portugal, marking the kick-off of the 'Minho Advanced Computing Centre' of the Foundation for Science and Technology, which increased the national scientific computing capacity by around tenfold.
 
We should highlight that REN also kept its commitment to local communities and to the protection of national forests.  More than 1 million native tree species have been planted since 2010, while in the past five years, REN has cleaned more than 30,000 hectares of easement corridors at its infrastructures, including 8,000 in 2019.
 
During this time, REN also signed the 'Business Ambition for 1.5 ºC' commitment letter, an initiative of the United Nations that challenges companies worldwide to create measures to combat climate change by reducing greenhouse gas emissions, which is essential to stop global warming. There is just one specific goal: to limit the increase of the planet's temperature to 1.5 °C.  
 
Certifications for the Quality, Environment and Occupational Health and Safety Management System were also renewed at the group's companies, including REN PRO for the very first time.
 
The start of 2020 will be dramatically affected by the global COVID-19 pandemic. We have put all our critical contingency plans into motion to ensure the operability of our people and the company in providing its services so essential to the country. 
 
We are working in complete harmony with the authorities, namely the government through the Deputy Secretary of State and for Energy, together with the Civil Protection Systems, in strict compliance with all recommendations from the Directorate-General of Health. 
 
It is still too early to foresee the impact of this crisis, something which we will assess in due time. Now, we must remain completely focused on fulfilling our mission in these extremely difficult times. Our entire company is committed to this goal, and this is encouraging. We remain hopeful that the biggest challenges will soon be overcome.