ENDESA: FY2020 RESULTS (ANÁLISIS BANCO SABADELL)
4Q'20 vs. 4Q'19 ResultsAdjusted EBITDA: € 891.0 M (-5.5% vs. -6.4% expected and -5.9% expected by the market consensus);
FY2020 vs. FY2019 Results
Adjusted EBITDA: € 4.027 Bn (+4.8% vs. +4.6% expected and +4.7% expected by the market consensus);
Adjusted Net Profit: € 2.132 Bn (+36.5% vs. +30.9% expected);
The FY2020 results came in as expected in adjusted EBITDA (€ 4.027 Bn of EBITDA vs. € 4.019 Bn BS(e) and € 4.023 Bn consensus) and slightly above expectations in adjusted Net Profit (€ 2.132 Bn vs. € 2.044 Bn BS(e)). In addition to the positive and negative one-offs accounted on the year, the company set aside a provision for an impairment in extrapeninsular assets worth € 338 M due to a regulation update one year ago. This has no impact on DPS’20 that will be € 2.014/sh. with 100% payout on adjusted Net Profit, meaning +36% vs. 2019 and a 9.35% yield (vs. € 1.90/sh. BS(e) and consensus).
By divisions, performance was solid especially in commercialisation and generation (33% EBITDA/ +21% vs. +22% BS(e)), which has continued to benefit from the short position on generation against a backdrop of growing demand in 4Q’20. In the rest of the divisions, the trends seen through 9M’20 have continued, with Distribution (55% EBITDA) falling -4%, in line with expectations. Lastly, the non-mainland business (12% EBITDA) fell -15%, in line with expectations.
NFD came in below expectations at € 6.89 Bn vs. levels below € 7 Bn BS(e) and € 7.02 Bn consensus.
Although the results came in as expected, we forecast a positive share price reaction driven by an attractive dividend and the stock’s poor performance vs. its integrated peers (-10% ELE vs. +4.2% Ibex vs. -8.2% IBE, +7.4% NTGY). BUY. T.P. € 28.04/sh. (+30% upside).
Endesa is engaged in the production, transmission, distribution, and supply of electricity, through hydroelectric, fossil fuel, and nuclear generation. Co. is also engaged in the mining of coal for use in its fossil-fuel electric plants; mining research; land restoration, and environmental monitoring and control.
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