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Introduction & Market Context
Endesa SA (BME:ELE) presented its first half 2025 consolidated results on July 29, 2025, highlighting solid performance across all business segments despite a challenging energy context marked by post-blackout measures and ongoing regulatory discussions. CEO José Bogas led the presentation, emphasizing the company’s resilience in a volatile market environment.
The energy market during this period was characterized by significant price volatility, with Gas TTF spot prices increasing by 47%, CO2 spot prices rising by 11%, and Iberian power pool prices surging by 58% compared to the same period last year. These fluctuations created both challenges and opportunities for Endesa’s integrated business model.
As shown in the following market context chart:
Financial Performance Highlights
Endesa delivered impressive financial results for the first half of 2025, with EBITDA reaching €2.7 billion, a 12% increase from €2.4 billion in the same period of 2024. Net Income showed even stronger growth, rising 30% to €1.0 billion, while Net Ordinary Income jumped 35% to €1,041 million. The company’s cash generation was particularly robust, with Funds From Operations (FFO) doubling compared to 1H 2024.
These results represent a continuation of the strong performance seen in Q1 2025, when the company reported a 33% year-on-year increase in EBITDA to €1.4 billion, suggesting some moderation in growth during the second quarter while maintaining overall positive momentum.
The following chart illustrates the company’s key financial metrics:
A detailed breakdown of EBITDA by business segment shows contributions from Generation, Renewables, Customers (Retail+EndesaX), Networks, and Structure & Adjustments. The company noted that the 1.2% extraordinary levy is no longer in force from 2025 onwards, positively impacting financial results.
The company’s Generation and Supply (Gx+Sx) EBITDA increased by 6%, driven by effective gas business management, non-mainland margin improvement, and gas retail margin expansion, despite limited opportunities in short positions and lower nuclear margin affected by the 7% generation tax increase.
Net Income growth was supported by a 23% improvement in financial results, driven by lower average gross financial debt and lower cost of debt. The income tax rate decreased to approximately 25% compared to 30% in 1H 2024, which had been impacted by the 1.2% levy.
Operational Achievements
Endesa made significant progress in its operational delivery during the first half of 2025. Renewable energy capacity increased by 0.7 GW to reach 10.8 GW, while GHG-free capacity rose to 79% of the total, up 1 percentage point from the previous year. The company also improved its distribution network reliability, with TIEPI (interruption time) decreasing by 2 minutes to 23 minutes.
The following chart details these operational improvements:
The company’s capital allocation strategy is reflected in its gross capex distribution, with 43% directed to Networks, 35% to Conventional Generation, and 22% to Renewables, highlighting Endesa’s balanced approach to investment across its business segments.
Market Dynamics and Regulatory Environment
Endesa reported signs of sustained demand recovery across all sectors. Adjusted demand increased by 2.9% year-on-year in 1H 2025, compared to a 0.8% decline in 1H 2024. By sector, residential demand showed the strongest growth at 7.5%, followed by services at 3.8% and industry at 2.7%.
The company is experiencing a surge in connection requests, which continue to grow exponentially as Spain attracts new demand by leveraging competitive energy costs through its decarbonized energy mix. However, approximately 80% of 2024 application requests were rejected, and only 10% of 1H 2025 requests were accepted, indicating significant constraints in the system’s capacity to accommodate new connections.
A key challenge highlighted in the presentation is the regulatory environment, particularly regarding network remuneration. Endesa emphasized that adequate remuneration is crucial for enabling the massive investments required for decarbonization. The company expressed concerns about the proposed 6.46% rate of return, describing the risk premium methodology as "discriminatory and asymmetric" compared to other Spanish regulated sectors.
Forward-Looking Statements
Endesa concluded its presentation with confidence in achieving its 2025 guidance, supported by the solid delivery in the first half of the year. The company highlighted its attractive shareholder remuneration, enhanced by the Share Buyback program, which has reached approximately 40% execution (€500 million) of the planned 2025 program.
The company’s strong cash generation has underpinned the sustainability of its financial ratios, with FFO to net financial debt showing improvement. Endesa also announced that its Capital Markets Day is expected by the first quarter of 2026, where it will likely provide updated strategic guidance.
Endesa remains focused on its strategic pillars while navigating market volatility, regulatory challenges, and the ongoing energy transition. The company’s integrated business model has demonstrated resilience in the face of these challenges, delivering solid financial and operational results in the first half of 2025.
Full presentation:
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