Iberdrola 2011 Profit Slips 2.3% as EU Economic Growth Slows
February 23, 2012, 7:07 PM ESTBy Ben Sills
(Updates with outlook for 2012 in fourth paragraph.)
Feb. 23 (Bloomberg) -- Iberdrola SA, Spain’s biggest electricity supplier, said net income slipped 2.3 percent last year as the global economic slowdown damped demand.
Profit fell to 2.8 billion euros ($3.72 billion) from 2.87 billion euros in 2010, the company said today in a filing. Earnings before interest, tax, depreciation and amortization rose 1.6 percent to 7.65 billion euros.
Iberdrola, the world’s largest owner of wind-energy plants, with about 8 percent of that business in the U.K., faced a “difficult macroeconomic environment” in 2011, it said in the statement.
The Spanish economy slipped toward a second recession in four years during the second half of 2011 while activity in the U.K. slowed as governments struggled to rein in their borrowing. Profit growth may fall short of the company’s 5 percent target this year should the economic slowdown persist, the company said.
The stock fell 3.1 percent to 4.52 euros at 11:13 a.m. in Madrid, trading near the seven-year low it reached in September. In comparison, the MSCI Europe/Utilities Index has rebounded 9.2 percent from the lows it reached at the same point.
The European Commission today cut its forecast for the euro-area economy, seeing a 0.3 percent contraction this year compared with November prediction for a 0.5 percent expansion. Spain’s economy will shrink 1 percent while the U.K. economy will slow to 0.6 percent from 0.9 percent in 2011.
Iberdrola’s power output in Spain last year fell by 11 percent and in Britain it dropped 19 percent. In the U.S., Iberdrola’s output rose 14 percent after the company added more than 600 megawatts of renewable-power generating capacity.
Iberdrola said it will maintain the dividend for the year at 32.6 euro cents per share.
--Editors: Alex Devine, Randall Hackley
To contact the reporter on this story: Ben Sills in Madrid at bsills@bloomberg.net
To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net
