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NATURGY: FY2019 RESULTS (ANÁLISIS BANCO SABADELL)

4Q'19 vs. 4Q'18 Results
EBITDA: € 1.272 Bn (+22.0% vs. +18.0% BS(e) and +14.8% consensus);
Net Profit: € 500.0 M (+129.4% vs. +150.5% BS(e) and +96.3% consensus);
FY2019 vs. FY2018 Results
EBITDA: € 4.562 Bn (+13.5% vs. +12.5% BS(e) and +11.6% consensus);
Net Profit: € 1.401 Bn (€ -2.822.0 M in FY2018 vs. € 1.447 Bn BS(e) and € 1.329 Bn consensus);
The 4Q’19 results beat our estimates on the operating level (+3.3% higher in EBITDA/-8.4% in Net Profit) and those of the consensus (+6% higher in EBITDA and +16% in Net Profit). In annual terms, the results would be more in line with our estimates but above those of the consensus (+2% in EBITDA and +5% in Net Profit). The surprise came in Gas & Electricity (34% of EBITDA), which grew +6% in EBITDA vs. +0% BS(e) and, specifically in International generation (7% of EBITDA), which grew +31% vs. +7% BS(e)). The rest of the divisions performed very much in line: +7% in Infra EMEA (45% EBITDA), +22% in Infra South LatAm (19%) and +62% in Infra North LatAm (6%). In conclusion, the results came in better than expected on the operating level thanks to increased EBITDA and a better Other results headline than expected (€ 93 M vs. € 25 M expected), but below expectations in Net Profit due to increased financial costs and minority items.
NFD came in very much in line with expectations: € 15.26 Bn (+0.9% vs. 9M’19), which means 3.3x EBITDA’19 adjusted for one-offs.
NTGY communicated it has already obtained € 270 M of annual savings from efficiencies vs. the € 500 M target set for 2022, meaning a faster pace than expected. We expect further details at the conference call to be held at 12:00 (CET). Positive market reaction although with limited upside to change our recommendation. We maintain SELL. T.P. € 23.94/sh. (+0.80% upside).