Portugal's leading utility company, EDP, announced a revised investment plan on Friday, reflecting a strategic response to increasingly challenging market conditions. The company disclosed a reduction in its three-year investment outlook while affirming its projection for substantial growth in net profit for the current year.
Updating its strategic direction, EDP revealed a scaled-back investment commitment of 17 billion euros ($18.31 billion) for the period spanning 2024-2026, down from the previously earmarked 19 billion euros. This adjustment follows a reduction in investment at its subsidiary EDP Renováveis, one of the world's largest wind energy producers.
Miguel Stilwell de Andrade, CEO of EDP, outlined the rationale behind the revised plan, emphasizing the need to adapt to shifting market dynamics. He stated, “We'll have selective and disciplined investment criteria, focused on top projects, and we'll prioritize returns over volumes.”
Addressing the specifics of the revised plan, EDP noted that while EDP Renováveis would invest three billion euros less than initially planned over the next three years, other business units within the EDP group would see an increase in capital expenditure by 1 billion euros compared to earlier projections.
Despite acknowledging a “more difficult market context,” Stilwell de Andrade affirmed EDP's profit guidance for 2024, indicating confidence in achieving around 1.3 billion euros in net profit, a significant increase from the previous year's figure of 952 million euros.
In terms of geographical allocation, EDP revealed that Europe would receive the lion's share of its investment at 45%, followed by North America at 33%. The Brazilian unit would account for 14% of investment, with the remaining 7% allocated to projects in other regions globally.
Stilwell de Andrade emphasized that the revised investment plan is fully funded and reiterated the company's commitment to its asset rotation strategy. He stated, “EDP will continue its asset rotation strategy, aiming to achieve revenue of seven billion euros in 2024-26 with the sale of parks generating capital gains of around 300 million euros per year.”
