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Investing.com -- Verbund (VIE:VERB) AG’s stock rose over 2% on Thursday after the company reported a stronger-than-expected fiscal year 2024 performance.
Fourth-quarter net income came in at €488 million, exceeding consensus expectations of €380 million by 28%.
Analysts at Morgan Stanley (NYSE:MS) had anticipated €420 million for the quarter. The results were supported by strong hydroelectric output, with hydro resources measuring 1.12, and a stronger-than-expected contribution from the grid business. This led to a 6% annual earnings beat at the bottom line.
The company announced a dividend of €2.8 per share, aligning with analyst projections, and representing a payout ratio of 52% for the year.
The guidance for 2025 remains within expected ranges, with projected EBITDA between €2.7 billion and €3.3 billion and net income estimated between €1.35 billion and €1.75 billion.
These projections encompass consensus expectations of €3 billion in EBITDA and €1.6 billion in net income, providing reassurance regarding the company’s outlook.
Despite a €100 million negative impact from extended Austrian windfall taxes, considered manageable by Morgan Stanley analysts due to offsetting capital expenditures, this is factored into the guidance.
Verbund’s balance sheet position also surpassed forecasts, with net debt standing at €2 billion, compared to a consensus estimate of €2.3 billion. Analysts at Morgan Stanley had anticipated €1.8 billion.
Operationally, the hydro segment posted a revenue of €694 million for the quarter, an 11% increase from the consensus expectation of €623 million.
The new renewables segment generated €47 million, a 9% improvement over the expected €43 million. The grid division saw the most substantial outperformance, delivering €114 million against a forecast of €74 million, marking a 54% upside. Conversely, the sales segment recorded an €8 million loss, reflecting a larger-than-anticipated shortfall.
With a stable dividend policy and a balanced approach to navigating regulatory impacts, Verbund’s outlook remains largely unchanged.