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Introduction & Market Context
EDP (Energias de Portugal) presented its first-half 2025 results on July 31 in Lisbon, highlighting strong underlying performance across its business segments despite modest declines in headline figures. The company emphasized the resilience of its integrated business model in Iberia and the continued growth in its renewable energy portfolio, which has led management to upgrade its full-year 2025 guidance.
The presentation comes amid increasing demand for ancillary services in the Iberian electricity market and continued investment in grid infrastructure to support the growing integration of renewable energy sources. These market dynamics have created favorable conditions for EDP’s diversified business model spanning generation, distribution, and supply.
Financial Performance Highlights
EDP reported recurring EBITDA of €2.6 billion for the first half of 2025, representing a 3% year-over-year decline in headline terms but a 7% increase on an underlying basis. Similarly, net profit reached €752 million, down 3% year-over-year but up 27% on an underlying basis when excluding asset rotation gains.
As shown in the following summary of key financial metrics:
The company’s performance was driven by strong results across its business segments. The integrated business in Iberia benefited from exceptional hydro resources, which were 41% above the long-term average in 1H25. Meanwhile, the Wind & Solar segment delivered 20% year-over-year growth in underlying EBITDA, reflecting increased generation capacity and improved operational efficiency.
Electricity networks also performed well, with EBITDA growing 6% year-over-year when excluding foreign exchange impacts and asset rotation gains. This growth was supported by inflation adjustments and regulatory asset base expansion in Iberia, as well as consumption growth in Brazil.
Segment Performance Analysis
The Generation & Supply segment saw a slight 3% decline in EBITDA, primarily due to changes in hydro resources and higher gas sourcing costs. Despite this, the segment is performing at the upper level of guidance for 2025, with approximately 80% of margin already locked in.
The following chart illustrates hydro resources in Iberia, which have been significantly above average:
In the Wind & Solar segment, installed capacity increased by 18% year-over-year to 19.6 GW, driving a 12% increase in electricity generation to 21.2 TWh. This growth reflects EDP’s continued investment in renewable energy capacity.
The Electricity Networks segment demonstrated resilience, with distribution volumes in Iberia increasing by 3% year-over-year to 30.7 TWh. In Brazil, transmission EBITDA grew by 16% year-over-year to 385 million Brazilian reals, benefiting from favorable regulatory developments.
Strategic Initiatives
EDP continues to execute its growth strategy in renewable energy, with approximately 2 GW of new capacity additions planned for 2025, 70% of which is scheduled for the fourth quarter. For 2026, the company has already secured about 65% of its targeted 1.5 GW capacity additions.
The following chart details the company’s capacity addition plans:
The company is also making progress on its asset rotation strategy, which is expected to generate approximately €0.1 billion in gains concentrated in the second half of 2025. Additionally, EDP has closed the asset rotation of Lot 21, comprising 435 km of transmission lines with an enterprise value of €0.4 billion.
Operational efficiency remains a focus area, with OPEX as a percentage of gross profit improving from 26% in 1H24 to 24% in 1H25. This improvement reflects ongoing efforts in organizational streamlining and digital transformation, with the employee count decreasing from 12,900 to 12,300 year-over-year.
Regulatory Developments
EDP highlighted positive regulatory developments across its key markets. In Spain, a public consultation has been launched proposing a 6.46% return on regulatory asset base (RAB) and a shift to a TOTEX model. In Portugal, the company expects returns to increase to support grid modernization and digitalization.
The regulatory framework for electricity networks in Iberia is evolving favorably:
In Brazil, EDP has secured a significant milestone with a 30-year concession extension for EDP ES. The new regulatory period will see an increase in the return on regulatory asset base from 7.15% to 8.03%, while the net RAB will grow from R$3.8 billion to R$5.5 billion. The company plans to invest R$3.3 billion in electricity distribution in Brazil during 2025-26.
Improved 2025 Guidance
Based on the strong performance in the first half of the year, EDP has upgraded its guidance for 2025. The company now expects recurring EBITDA to reach approximately €4.8-4.9 billion, with net profit projected at €1.2-1.3 billion. Net debt is expected to be around €16 billion by year-end.
The integrated business in Iberia has seen its EBITDA guidance upgraded to €1.2 billion, reflecting the strong performance in the first half and favorable market conditions.
The updated guidance is summarized in the following slide:
Forward-Looking Statements
EDP announced that it will provide a comprehensive strategic update at its Capital Markets Day scheduled for November 6, 2025. This event is expected to outline the company’s long-term vision and strategic priorities.
The company’s net debt is projected to increase from €15.6 billion at the end of 2024 to €17.2 billion during 2025, before settling at approximately €16 billion by year-end. This temporary increase reflects the annual dividend payment made in the second quarter and ongoing investment execution, with asset rotation and tax equity proceeds expected to be skewed toward the second half of the year.
Despite the near-term increase in debt, EDP remains focused on maintaining a strong balance sheet and creating value through strategic investments in renewable energy and grid infrastructure. The company’s underlying performance demonstrates the resilience of its business model and its ability to navigate changing market conditions while delivering sustainable growth.
Full presentation:
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