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Executive Summary
Redeia Corporacion SA (BME:REE) reported solid financial results for the first half of 2025, with EBITDA growing 2.8% year-over-year to €636 million, while maintaining a stable net profit of €269 million despite significant investment increases. The Spanish grid operator highlighted its accelerated infrastructure development program, with transmission system operator (TSO) investments surging 34% compared to H1 2024, reaching €564 million.
The company is making substantial progress on several strategic interconnection projects while preparing for a more favorable regulatory environment, with a proposed increase in the Financial Remuneration Rate (FRR) for 2026-2031 to 6.46% from the current 5.58%.
Quarterly Performance Highlights
Redeia delivered revenue growth of 2.2% in the first half of 2025, reaching €843 million compared to €826 million in the same period last year. This growth was primarily driven by the regulated business in Spain, which increased by 3.4%, offsetting slight declines in international (-1.7%) and fiber optic business (-2.3%).
As shown in the following chart of key financial figures, the company maintained stable performance across major metrics:
The company’s profit structure shows that 89% of EBITDA comes from regulated business, with the TSO segment contributing 79.3% of total EBITDA. The detailed profit and loss statement reveals that profit from continued operations grew by 1.5%, though the final net profit remained flat year-over-year at €269 million.
Operating expenses increased by 3.1% to €288 million, primarily due to higher personnel expenses and other costs, partially offset by income in other operating categories:
Investment Strategy
Redeia is executing an ambitious investment program, with TSO investments reaching €564 million in the first half of 2025, representing a 34% increase compared to the same period in 2024. The company highlighted that 94% of the group’s investments are eligible according to EU Taxonomy criteria, underscoring its commitment to sustainable infrastructure development.
The following chart illustrates the significant ramp-up in investment activity:
Key strategic projects include progress on the interconnection with France (€158 million), Peninsula-Balearic Islands interconnection (€10 million), and various island connections including Tenerife-La Gomera (€20 million) and Peninsula-Ceuta (€66 million). The company is also investing in renewable generation evacuation (€28 million) and the Salto de Chira pumping station (€34 million).
Looking at the historical investment trend, Redeia expects to exceed its Strategic Plan 2021-2025 target of €3.9 billion, with total investments for the period now projected to surpass €4.2 billion. The company anticipates investments of over €1.4 billion in both 2024 and 2025, representing the largest investment effort in its history.
Financial Position and Debt Structure
Redeia’s net debt increased by 3.1% to €5,539 million as of June 30, 2025, compared to €5,370 million at the end of 2024. This increase reflects the company’s significant investment activity, partially offset by positive cash generation and working capital evolution.
The company maintains a sound financial structure with 80% of financing linked to ESG criteria. The cost of debt stands at 2.20%, slightly lower than the 2.22% reported in H1 2024, with an average maturity of 4.9 years. Redeia’s liquidity position remains comfortable at €2,828 million.
Regulatory Environment and Outlook
A significant regulatory development is the proposed increase in the Financial Remuneration Rate (FRR) for the 2026-2031 period. The draft proposed by the regulator sets the FRR at 6.46%, up from the current 5.58%, which would positively impact Redeia’s future earnings. The deadline for submitting allegations to this proposal is August 4, with final adoption expected later in the year.
The company also addressed the April 28 incident, noting that investigations by the CNMC and the National Court are ongoing. No provision has been recorded in the interim financial statements as Redeia maintains it "acted with the utmost responsibility and professionalism" in applying operating procedures and restoration protocols.
For the full year 2025, Redeia confirmed its outlook in line with strategic plan targets, projecting EBITDA to exceed €1,250 million and net profit to surpass €500 million after the planned sale of Hispasat, which is expected to close in Q4 2025. The company reaffirmed its dividend commitment with a floor of €0.8 per share for both 2024 and 2025.
Forward-Looking Statements
Redeia’s presentation highlighted several system operator recommendations and approved measures to reinforce the electricity system following the April incident. These include increased capabilities for voltage control, damping of oscillations, and revised overvoltage function settings. The government has approved new investment plans with an additional €750 million, bringing the total investment in the 2021-2026 Planning to €8,203 million.
The company also secured support from the European Investment Bank (EIB) for financing strategic projects, with €150 million and €400 million tranches secured as part of an €800 million financing package. This funding will help Redeia maintain its ambitious investment program while preserving its credit metrics, with current ratings of A- (stable outlook) from Fitch and CreditWatch negative from S&P.
With the proposed increase in regulatory remuneration and record levels of infrastructure investment, Redeia appears well-positioned to strengthen Spain’s transmission network while supporting the integration of renewable energy sources and enhancing interconnections with neighboring countries.
Full presentation:
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