Endesa 2021 earnings beat boosts dividend above expectations

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A man walks under the logo of Spanish power company Endesa at their headquarters in Madrid, Spain, April 26, 2016. REUTERS/Andrea Comas

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MADRID, Feb 22 (Reuters) - Spanish power group Endesa (ELE.MC) posted higher than expected earnings for 2021 on Tuesday, raising shareholder returns for a year in which the company had lamented the negative impact of high wholesale power prices on its profit margins.

Endesa, a unit of Europe's largest utility Enel made 4.28 billion euros ($4.85 billion) in earnings before interest, tax, depreciation and amortisation (EBITDA), beating its own guidance of 4 billion euros.

As a result, shareholders will receive dividends worth 11% more than they had previously been promised, cashing in 1.44 euros per share, based on the proportion of profits the company had pledged to pay out.

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A large chunk of the extra earnings resulted from a Spanish court decision to overturn a charge imposed on hydro-power plants by a previous government. read more

Endesa said halfway through 2021 that soaring gas and electricity prices were eroding its margins because it had to spend more to buy power on the wholesale market than it could charge clients whose tariffs were fixed far in advance.

The company wrote down the value of electricity generation plants in its markets off the Spanish mainland - the Balearic and Canary islands and the North African enclaves of Ceuta and Melilla - by 652 million euros.

($1 = 0.8825 euro)

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Reporting by Isla Binnie; editing by Jonathan Oatis

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