Naturgy Energy Group S A

Good morning, everyone. This is Abel Arbat speaking from the Capital Markets Team at Naturgy, and we thank you for joining our results call for the first nine months of 2025. Next to me sits the Head of Financial Markets and Corporate Development, Mr. Stephen Fernandez, and the Head of Control and Energy Planning, Mrs. Rita Ruiz de Alda. As usual, we will begin with the presentation and leave Q&A for the end. Please submit your questions in written form through the webcast platform during the presentation, and we will address those at the end of the presentation. So without further ado, I'm going to hand it over to Stephen to start off on the presentation.

Thank you, Abel, and good morning, everyone. As you have seen this morning, this presentation is basically divided into three main sections that we're going to go through. Firstly, we're going to review the results for the first nine months of the year. Then we're going to give you a little update on the reestablishment of the company's free float following recent moves. And finally, we're going to give you some glimpses into the outlook for the remainder of the year 2025. If we move over to the results, the key highlights that we'd like to highlight Discuss, basically, as you can see, we've had an overall robust operational performance amid a challenging and uncertain geopolitical backdrop. We are, as a result of that performance, on track to deliver on its 2025 guidance, building again on a track record of commitment and delivery. On the capital markets front, we have increased the free float for the company and subsequently the share liquidity, positioning us to return to the MSCI indexes. As a reminder, the free float for the company has increased from 10% to almost 19% in record time and preserving value for shareholders. As a result of this effort, as I mentioned previously, liquidity has improved, and the monthly average trading volumes are up two times versus the first half of the year. Our solid balance sheet also continues to provide flexibility and optionality, and we also remain committed to an attractive shareholder remuneration. As a reminder, the second 2025 dividend of $0.60 has been approved by the board, and it will be payable on November 5th. on track for a minimum annual total DPS of 1.7 euros per share. If we move over to review the results, what you can see is that average rent prices were 14% lower in the first nine months of the year compared to the same period last year, decreasing from $83 to $71 per barrel. In contrast, natural gas prices increased across key benchmarks. For example, the TTF was up 26%, the hub up 58%, and JKM up 17%. Hence, we have witnessed a decoupling of gas and oil indexes during the period. Deer politics also weighed on energy markets in the first nine months of the year, although volatility has thankfully gradually eased in recent months. Iberian electricity pool prices for its parts showed an increase from 52 euros per megawatt hour in the first nine months of 2024 to 63 euros per megawatt hour in the first nine months of this year, mainly driven by higher demand for gas fire generation in the period, along with higher gas prices. As a result of this scenario, we take a quick look at the results for the period. EBITDA amounted to 4.21 billion euros. Net income amounted to almost 1.7 billion euros. A reminder that the dividend that we have paid so far this year amounts to 1.1 billion euros. And net debt for the group amounts to 12.9 billion euros, which, by the way, does not include the proceeds from the bilateral sale and subsequent total return swap we have entered into. The results, therefore, maintained record levels while delivering on shareholder remuneration and maintaining a strong balance sheet. As we will review in the coming pages, and especially with the help of Rita, during the third quarter of 2025, market trends and business dynamics have remained broadly in line with those that we had seen in the first half of the year. Moving over to the income statement, EBITDA remained in line with last year, although 2025 shows stronger underlying results, as it does not include relevant extraordinary items contributing to it as 2024 did. And in terms of EBITDA contribution, by business, 49% was generated by networks and 51% by energy management generation and supply. In terms of activities, you also see a balance here with 54% of the EBITDA being generated by gas with a balance from electricity. And again, in terms of the geographical diversification, a little bit more than half of the EBITDA generated in Spain with a balance coming from all our other operations abroad. The group's diversification across businesses, activities, and geographies continues to support its earnings resilience. and the way of its regulated activities provide us with cash flow predictability. So, all in all, the earnings were 6% higher compared to last year in the period, reaching almost 1.7 billion euros. If we turn over to the cash flow, pre-cash flow after minorities reached almost 2.2 billion euros, demonstrating strong cash flow generation for the first nine months of the year. In this period, the company invested 1.2 billion euros, roughly of which 45% was allocated to networks, 35% to renewables, and the balance of the business accounting for 20% of these investments. This shows greater focus on networks capex versus renewables compared to 2024, and it's aligned with the company's financial discipline. Also note that 169 million euros of hybrids were amortized during the period, which means only 330 million of hybrids remain outstanding. We will continue to follow a strict financial discipline, deploying capital to ensure value creation on our investments. As a reminder, we believe in value over size. So, all in all, strong cash flow in the period to back investments and shareholder remuneration, as you can see. But if we then turn over to the net bets, you can see that the balance sheet remains strong, actually stronger than we had anticipated. In April and July, Natruji distributed its 2024 final dividend and first interim dividend for 2025, respectively, both of them in cash at €0.60 per share for a total of €1.1 billion spent year-to-date. In June, the company also completed a 2.3 billion euro tender offer on our own shares, and already in August, we were able to undertake a successful placement and return 2% of its capital to institutional investors, in addition to 3.5% to a financial institution with whom we have signed a TRS. This places net debt at the end of September 2025 at 12.9 billion euros, with a countable net debt to last 12 months 2025 EBITDA of 2.4 times. Moreover, as you have seen, in October the company also managed to undergo a second placement of treasury shares, amounting to 3.5% of its share capital, which will be reflected in the net debt figures as of the year end. The cost of that remains at around 4%, while the percentage of fixed rates has increased to roughly 66% in the lower interest rate environment. So, all in all, you can see we have a strong balance sheet with low leverage post-recent capital market transactions and free float increase that provides the company continued flexibility and optionality. And with that, I'll hand the turn over to Drita, who will go over the businesses.

Thanks, Stephen, and good morning, everyone. Starting with networks on page 10, networks reported a total EBITDA of €2,098 million in 2025, representing an 8% decline when compared to 2024. This decrease was primarily driven by one of positive impact in Chile last year and the depreciation of several Latin American currencies, most notably the Argentine peso. In Spain, gas networks experienced the remuneration adjustments foreseen in the current regulatory framework, as well as increased demand in residential segments due to temperature effects. As highlighted in our latest result presentation, a public consultation was launched in July targeting companies in the sector and marking the start of the regulatory review process for the 2027-2032 period. In line with the regulatory calendar, a draft proposal is expected to be published by year-end or early 2026. In electricity, a bid increase driven by higher regulated asset base and the publication of the 2021 and 2022 definitive remuneration, as well as attractive impacts. The CNMC has already published a second draft of the resolution of the new regulatory scheme for the 2026-2031 period, and the companies in the sector have already sent allegations. In Mexico, results mainly impacted by negative foreign exchange effects compensated by tariff updates in July. In Brazil, results were also affected by currency depreciation. In Argentina, EBITDA has improved following a substantial tariff increase implemented in 2024 to offset inflation. At the same time, we are observing a rising trend in FX volatility, largely driven by electoral milestones. As mentioned in July, a new tariff review was approved for the 2025-2030 regulatory period, in line with our strategy plan estimates. This new regulatory review provides feasibility to 2030 and includes monthly inflation adjustments within a stable regulatory framework. In Chile, performance declined when compared to last year due to an extraordinary effect in 2024 as a partial reversal of the provision related to TGN conflicts. As we already mentioned in the last presentation, this legal process is now officially closed due to an agreement between both parties. In Panama, results were negatively affected by lower demand due to temperature effects and increased operating expenses from higher maintenance activity to improve quality standards. In summary, comparison is affected by extraordinary impact in 2024 and currency depreciation in the past. Now turning to energy management, on page 11, a bid that reached €718 million, which shows an increase versus 2024 of an 18%, mainly due to higher margins on hedgesales. On average, European gas prices were 26% over 2024 levels. As mentioned during the strategic plan presentation, the group is fully hedged for 2025, having adopted an active risk management approach in the context of high volatility and uncertainty. The figures already reflect current market conditions for gas contracts in 2025, while negotiations with Sonatrac are still ongoing. The group is continuously evaluating new gas sourcing opportunities to complement our portfolio, as we consider natural gas a key enabler for the energy transition. Finally, last week, the EU formally adopted a prohibition on the purchase, import or transfer of LNG exported from Russia into the European Union. The prohibition will be effective starting in January 2027 in the case of long-term gas contracts, such as the one which naturally holds with Yamal. Overall, the period benefited from effective hedging and diversified procurement portfolio. Continuing with thermal generation, EBITDA reached €523 million, 22% over 2024 EBITDA levels, due to higher activity in Spain, partially offset by lower revenues in Latam. In Spain, the increase in results was supported by higher demand for ancillary services from our combined cycle fleet. Naturi holds the largest CCET fleet in Spain with 7.4 GW, acting as a backbone to energy security of supply. In Mexico, production and margins remain stable. However, revenues from availability markets decline, mainly due to exceptionally high revenue base in 2024. Overall, CCGTs continue to play a key role to ensure the system stability. Let's turn now to Renewal Generation on page 13. Renewal Generation reached an EBITDA of €452 million during the period slightly above 2024 level. In Spain, renewable production was 8% lower when compared to 2024, mainly due to lower wind and hydro generation, given the exceptionally high levels of hydro production in our basins during 2024. This negative impact was partially offset by the commissioning of new install capacity and higher electricity prices. In the United States, results are higher when compared to 2024, mainly due to higher energy prices. The group completed construction of its second solar plant in Texas, which has recently started operations. In Latin, activity continues with impact due to currency devaluation in Mexico and Brazil. And finally, in Australia, performance benefited from the additional stock capacity added when compared to 2024. All in all, higher results in renewal generation due to commissioning of new capacity and selective growth prioritizing value oversize. Last, moving to supply, EBITDA has been €500 million, a 16% lower when compared to 2024. It is important to remember that in 2024 we had an extraordinary impact due to the positive ruling in favor of natural yield regarding tariff subsidies. Leaving this aside, the business performed relatively stable when compared to last year, despite incremental margin pressure and competition. Thus, margins have shown resiliency, supported by higher visibility on procurement costs, but negatively affected by regulated tariffs. In terms of electricity, the group has expanded its client portfolio in a highly competitive environment, leveraging on its integrated model and diversified generation mix. However, impacted by increasing adjustment services costs. I will now pass the floor back to Stephen to update you on the free float and outlook.