IBERIAN DAILY 24 OCTOBER + 3Q’23 RESULTS. HIGHLIGHTS AND REST OF PREVIEWS (ANÁLISIS BANCO SABADELL)
NEWS SUMMARY: ACCIONA, CELLNEX, ENAGÁS, IBERDROLA.At the end of today’s report, and during the entire results season, we will include a presentation with positive and negative results highlights and previews for the 3Q’23 results to be released over the coming days in Spain.
The Treasury near 5%
European stock markets were punished by the initial hike in debt rates (the US 10Y exceeded 5.0%) although they gained ground as rates eased after some diplomatic moves in the Middle East. Thus, the STOXX 600 ended flat, with Basic Resources, energy and Telecommunications leading drops whereas Travel&Leisure, Media and Retail saw the bigger gains. On the macro side, in the euro zone, October’s consumer confidence deteriorated more than expected. In the US, the United Auto Workers union declared a strike for most of Stellantis’ assembly factory, Chrysler’s parent company (from the 15th of September around 40,000 employees at Ford, General Motors and Stellantis would be on strike). In Japan, October’s manufacturing PMI remained at September’s level (48.5), whereas that of services dropped to 51.1, lowering the composite PMI to annual lows of 49.9. In US business results, Alexandria Real State in line and Berkley and Brown&Brown better than expected. On another note, the International Energy Agency estimates that the demand for crude oil would peak around the middle of this decade, as well as CO2 emissions, with clean energies accounting for 50% of the energy mix by 2030 (vs. 30% currently).
What we expect for today
European stock markets would open flat with a slight bearish slant, awaiting October’s PMI data, although the business results and ECB are the most important events this week. Currently, S&P futures are up +0.13% (the S&P 500 ended down -0.54% vs. the European closing bell). Volatility in the US dropped (VIX 20.37). Asian stock markets are climbing (China’s CSI 300 +0.11%, Japan’s Nikkei +0.11%).
Today in the UK we will learn August’s ILO unemployment rate, in the euro zone October’s (preliminary) manufacturing and services PMI In US business results, General Electric, General Motors, Halliburton, Verizon, Coca-Cola and PACCAR, among others, will release their earnings. As for auctions, Germany will issue € 4 Bn in bonds due 2028.
COMPANY NEWS
ENAGAS. 9M’23 Results in line with expectations and to meet the guidance. BUY.
The negative comparison in EBITDA vs. 9M’22 (-5.5% vs. -6.6% BS and -3.7% consensus) is explained by the decreasing regulatory framework and the lower contribution from associated companies. The 9M’22 Net Profit totalled € 258 M (-27% vs. 9M’22 vs. -29% BS and -26.6 consensus), where we also stress the negative comparison vs. 2022 positive capital gains after the sale of GNL Quintero and 30% of Hy24. The 9M’23 NFD remains in line (€ 3.41 Bn) and FFO/NFD at 17.1%. Results in line to meet the annual guidance of around € 770 M of EBITDA (in line with the consensus and BS(e)) and around € 310-320 M of Net Profit. We expect a neutral market reaction. Conference call at 9:00 (CET).
Acciona is the parent company of a construction group. Co. is engaged in general construction activities in the areas of civil engineering and buildings, including railways, marine and hydraulic works, motorways and airports, town planning, conduits, pavements, parking lots, and industrial and urban buildings. In addition, Co. is engaged in the provision of real estate services, the operation of parking lots, telecommunications, services, ecology and alternative means of energy. Co.'s operations are organized in six business divisions: Infrastructures, Real Estate, Energy, Water, Environmental & Urban Services and Logistic & Transport Services.
Cellnex Telecom SA is a Spain-based company engaged in the wireless telecommunications (telecom) business. Its activities are divided into three segments: Broadcasting infrastructure, Telecom site rental, as well as Network services and other. The Broadcasting infrastructure division comprises distribution and transmission of television (TV) and frequency modulation (FM) radio signals, operation and maintenance (O&M) of radio broadcasting network, as well as over-the-top (OTT) radio services, among others. The Telecom site rental division provides access to wireless infrastructure, primarily through infrastructure hosting and telecom equipment co-location, mainly for mobile network operators and other wireless and broadband telecom network operators. The Network services and other division offers connectivity services for a variety of telecom operators and radio communication, among others. The Company also develops 5th generation mobile networks (5G) through Alticom BV.
Enagas is a gas transportation company based in Spain. Co. is engaged in the technical distribution and storage of gas through pipelines as well as the provision of regasification services. Co. and subsidiaries are engaged in the ownership, administration, storage, pipeline transportation, distribution flow, and sale of natural gas. As a transport company, Co. also provides gas and manages the gas infrastructures.
Iberdrola is a holding company. Through its subsidiaries, Co. operates in four segments: network business, which includes all the energy transmission and distribution activities, and other regulated activity originated in Spain, the U.K., the U.S. and Brazil; deregulated business, which includes electricity generation and sales businesses as well as gas trading and storage businesses carried on by Co. in Spain, Portugal, the U.K. and North America; renewable business, with activities related to renewable energies in Spain, the U.K., the U.S. and the rest of the world; and other businesses, including the engineering and construction businesses and the non-power businesses.
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