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UPDATE 1-Iberdrola maintains outlook after steady H1
July 23, 2014 / 7:20 AM / 3 years ago

UPDATE 1-Iberdrola maintains outlook after steady H1

* H1 EBITDA 3.75 billion euros, unchanged versus 2013

* Maintains guidance for EBITDA of 6.6 billion euros in 2014

* Says no further regulatory hit expected in Spain this year (Adds reiteration of guidance, debt and background)

By Tracy Rucinski

MADRID, July 23 (Reuters) - Spain’s Iberdrola, a world leader in renewable energy, reiterated full-year guidance after strong hydro production and growth abroad helped cushion the negative impact of regulatory changes on its domestic electricity business in the first half.

Spanish utilities’ results have suffered from sweeping regulatory measures meant to cap a deficit of around 30 billion euros ($40.4 billion) in the electricity sector built up after years of mismatched regulated prices and costs.

Iberdrola, Europe’s third-largest utility by market value, said earnings before interest, taxes, depreciation and amortisation (EBITDA) was 3.75 billion euros in the first half to June, the same as a year ago and in line with an average 3.75 billion euro forecast in a Reuters poll of analysts.

“A good business performance, mainly in international operations, has allowed us to partially compensate for the impact of regulatory measures in Spain,” the company said.

The company is forecasting EBITDA of 6.6 billion euros in 2014 and net profit of around 2.2 billion euros.

Net profit fell 13 percent to 1.50 billion euros in the first half from a year ago, mainly due to regulatory measures such as higher taxes and subsidy cuts.

Iberdrola said it does not expect any major additional regulatory hit in Spain in the second half.

Still, the company has been focusing its strategy on expanding in power grids and renewable assets abroad rather than investing in its home market, where it is exploring the sale of a minority stake in its distribution business.

The potential sale, worth 3 billion euros, could allow Iberdrola to reduce debt and to bring a minority investor into a business in which it controls 34 percent of the Spanish market.

Net debt totalled 25.7 billion euros at June 30, down by about 8 percent from a year ago, the company said, adding that it had 10 billion euros of liquidity, enough to cover its financing needs for the next 35 months. ($1 = 0.7427 Euros) (Editing by Erica Billingham)

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