Iberdrola Sa S/Adr

Buenos dias, señoras y señores. Good morning, ladies and gentlemen. First of all, we would like to offer a warm welcome to all of you who have joined us today for our 2025 first quarter results presentations. As usual, we will follow the traditional format given in our events. We are going to begin with an overview of the results and the main developments during the period given by the top executive team that usually is with us, Mr. Ignacio Galán, Executive Chairman, Mr. Armando Martínez, CEO, and finally, Mr. Pepe Sainz, CFO. Following this, we'll move on to the Q&A session. I would also like to highlight that we are only going to take questions submitted via the web, so please ask your question only through our webpage www.iberdrola.com. Finally, we expect that our event will not last more than 60 minutes. If any questions remain unanswered, we at IR are, as always, fully at your disposal. Hoping that this presentation will be useful and informative for all of you, now, without further ado, I would like to give the floor to Mr. Ignacio Galán. Thank you very much again. Please, Mr. Galán.

Thank you, Ignacio. Good morning, everyone, and thank you very much for joining to this call. I would like to start thinking and recognizing the excellent work of more than 2,000 professionals of Iberdrola, which have already restored electricity in Spain after the blackouts suffered two days ago. At all times, our generation plants were available to operate under the instruction of the system operator Red Electrica. Also, our distribution networks were also connecting and restoring the service progressively as the system operator, who is responsible for the operation, asked us to do it. Moving to results, in the first quarter of 2025, net profit reached 2,004 million euros, 26% up year-on-year, excluding the capital gains from last year's investment of thermal generation. And reported EBITDA was 4,643 million, also 12% up in like-to-like terms. mainly driven by strong operating performance in networks, we represent 52% of EBITDA through March, and higher generation volumes for new assets in operation in the US, Iberia, and the rest of the world, partially offset by the normalization of margin in the United Kingdom, especially in Iberia, resulting 70% decrease in EBITDA in Spain. Investments were up by 14%, hitting a new record of 2,720 million euros in just one quarter, and 17,300 million euros in the last 12 months. Thanks to 30% increase in the US and UK over the quarter, which together represent two-thirds of our total investment. By businesses, network investment were up 18%, mainly driven by 30% increase in the UK, both in transmission and distribution. Renewable investment rose by 7%, with offshore wind up 50% due to projects under construction in the US and UK and Germany, all of which will be operational in 2025 and 2026. In addition, we received the final approval from UK Competition and Market Authority for the integration of electricity in the West has been fully consolidated in our account since March. As a result, our regulated asset base in UK is now reached 15.5 billion euros more than Dublin in just five years. Thanks to the contribution of new investment, cash flow increased by 11% with respect to the first quarter of 2024 to 3,502 million euros, leading to financial ratios that are fully consistent with our triple B plus rating. As mentioned, EBITDA reached 4,643 million euros, 12% up, with almost 50% coming from the US and UK, mainly due to the strong growth in our network assets base in both regions, offsetting the decreased Spain results. As a consequence, networks contributed more than 50% of total EBITDA, almost 10 points above the average of the last five years. EBITDA in these businesses also includes a positive impact to the recognition of past costs in the US. Production and customers operating results reflect 2,600 installs over the last 12 months, of which 660 come from offshore wind. An increased production in the US, Iberia, France, Germany and Australia, offsetting the normalization margins in the UK and Iberia. Finally, we continue closing new PPAs with Tier 1 customers with more than 4 TWh per annum signed in the last 12 months, reaching a total portfolio of around 40 TWh per annum to be supplied per annum in the following years. The record investment figures achieved in this first quarter, more than 2.7 billion euros, are mainly due to our strong expansion in networks with 1,432 million invested through March. up 18% over Q1 2024 and more than 50% above the average of the last five years. Mainly driven by the US and UK, we represent more than two-thirds of the total after doubling investment levels over the past five years. This increase will accelerate in the coming quarters, given the huge investment commitments in both countries. In the UK, we are progressing with OJEN in the approval process Rio T3, which is expected to support an unprecedented expansion of transmission infrastructure between 1026 and 2031. And we foresee a similar trend in distribution. Recently, OJEN approved 200 million euros in additional investment for Scottish power distribution licenses, including electricity in the West. In the United States, network investment increased by 10%, with 241 euros invested in transmission, mainly in the NCEC interconnection between Massachusetts and Canada. In this project, all foundations and poles have been already installed in the DC line, and we continue progressing the converter station and other facilities, expecting to have this infrastructure fully operational by the year end. Avant-garde distribution investments have reached close to 100 million euros, 80% in the state of New York, where all our companies are reaching and exceeding the headline return of equity set in their rate cases. In Brazil, the regulator has approved a new tariff review in Pernambuco for the next four years and an annual rate adjustment in Bahia Grande do Norte. That together will add at least 100 million euros operating result per annum, increasing energy EBITDA by 10% on the annual basis with this adjustment. In addition, the renewal process for distribution concession is progressing as expected. Our total regulated asset base reached €49 billion, reflecting the organic growth already mentioned and the consolidation of electricity in the West, which contributes €3.4 billion to our asset base and is expected to add around €450 million of the Vida per annum exceeding initial expectations. Following this excellent performance, Electricity North West recently received the Utility of the Year award by Utility Week and was ranked number one in the OJN Annual Performance Benchmark in all UK distribution companies, followed by the other two Scottish Power Licenses in Scotland, England and Wales, which were ranked second and third. Biographies, US and UK already contribute 60% of our regulated assets base, which is expected to exceed 51 billion euros by the year end. Investment in renewables increased by 7% up to 1,064 million euros, which two-thirds is in United Kingdom and United States. More than 50% of renewables investments were located to offshore wind, mainly in the cross-strands of Binger Wind in the U.S., which we will fully operationalize by year-end, East Anglia 2 and 3 in the U.K., and the rest in Bindacker in Germany. Offshore wind accounted by 20% of total investment, more than the U.S. and the U.K. And solid PV represents 21%, highly diversified between the U.S., Iberia, other countries in continental Europe and Australia. All these investments continue to progress as scheduled even in the current supply chain scenario thanks to our procurement strategy, based on local suppliers who represent 80% of our total purchase, and the anticipation of business needs through detailed planning processes securing all strategic contracts in advance. This strategy is also protecting us from current global trade dynamics. Currently, we expect no impact for a new tariff in our result, with a maximum increase of just $130 million in the group investment cost, or less than 1% of our total annual capital, clearly within our planned contingency levels. Related to 10% of our investment in our offshore wind and solar PV projects under construction in the U.S., Where we have clauses in our contract with suppliers, they will allow us to reduce this amount. We do also expect any impact in transmission and distribution investment as 99% of the U.S. purchases are local and these businesses are regulated. In our offshore wind, where 100% of the supply chain of Vinyard Wind 1 is already fully secured. Our strong increase in net worth investment and our selective approach to renewables is also driving a structural improvement in our cash generation profile and financial ratios. In renewables, we expected completion of major projects and the construction will reduce by 50% the working progress in this business over the next two years, from 8.6 billion euros today to between 4 and 5 billion by the end of 2026. In addition, these new assets will add around 100 million euros of EBITDA on an annual basis both in 2025 and 2026, for a total of 1.6 billion from 2027. mainly coming from the offshore wind project of Isaglia III in the UK, Vingia Green in the US, and Baltic Eagle and Windacker in Germany, which have already closed long-term PPAs of CFDs, providing significant stability to revenues and profits. All this will drive a substantial increase in our return on investment in these businesses and in our overall financial strength. That will continue improving thanks to our focus on networks, where we expect to invest more than 13 billion euros between 2025 and 2026. As 90% of this investment will have a positive impact on return and cash from year one, including 100% network investment in the UK and all investment related to Raycase in the US plus NCEC interconnection project beginning in 2026. Our strong operating performance and the acceleration of gas recovery has driven an 11% increase in funds for an operation to 3,502 million euros, allowing us to maintain our financial ratio in line with our plan and with our triple B plus rating after the cancellation of electricity in the West and the purchase of agreed minorities. with EFE over-adjusting the debt of 22.3%. In addition, our liquidity remains at 21 billion euros, enough to cover 19 months of financial needs. I will now hand over to our CFO, Pepe Saiz, who will present the group financial research in more detail. Thank you. Pepe.

Thank you. Thank you, Chairman. Good morning to everybody. As the Chairman has said, the first quarter 2025 net income reached 2004 million and grew 26% once compared to the first quarter of 2024 adjusted net income, excluding the thermal generation asset divestment. As main change of the perimeter, let me highlight that the ENW is fully consolidated since March. FX evolution has had a minor effect on results, with the dollar and the pound growing 3.8% and 2.8%, and the Brazilian real being 13% lower. A 1% increase in revenues, mainly in the network business due to the U.S. recovery of past costs, combined with a 3% decrease in procurements, boosted gross margin by 5% to 7.2 billion euros. 1.7 billion thermal generation asset divestments in Q1 of 2024 positively impacted reported net operating expenses. Excluding it, first quarter 2025 net operating expenses decreased 10.4%, mainly due to the 176 million lower storm costs In the US, that is neutral at the EBITDA level, as it also lowers the gross margin. Net personal expenses decreased 0.4%, external services fell 9.8%, and other operating income grew 30% due to indemnities of past year costs. Excluding also the mentioned reconciliation impacts, and other minor net operating expenses improved 0.9%. Analyzing the results of the different businesses and starting by networks, it's a bid that grew 43% to 2,415 million euros, with better performance in the UK and in the US. In the UK, EBITDA increased 10.8% to £339 million, excluding £35 million positive net contribution from E&W, effective since March, and higher contribution in distribution thanks to higher RAP, and that more than compensates negative contribution from transmission due to the CAP allowance application. In the U.S., EBITDA reached $1,054 million with higher tariffs and better contribution from transmission, and positively impacted by the new decision from the New York regulator that allows to register regulatory assets regarding past costs, already accrued and registered on the U.S. GAAP. In Brazil, EBITDA increased 12.6% to 3,684 million reais, that in euros is a small fall, with higher inflation over a higher asset base and positive contribution from transmission and construction as construction of transmission lines progresses. In Spain, EBITDA fell 1% to 400 million euros. Our operating performance was in line with last year. In the first quarter, energy production and customer business EBITDA reached 2.2 billion euros compared to the 4.1 billion of last year that included the already mentioned 1.7 billion euros thermal divestment capital gain. Excluding it, as you can see in the slide, the first quarter and 25 EBITDA fell 9% compared to the adjusted first quarter of 24. The business reached 89% emission-free generation. In Iberia, EBITDA was 1,035 million euros, 15.3% down, with a slightly higher production, partially offsetting margin normalization, and 3% higher levels, levies, even despite 1.2% revenue tax termination. As of April, Iberdola had record hydro reserves, 9 terawatt-hours, which will help the performance of the group in 2025. In the UK EBITDA fell 17.2% to £426 million with lower wind resource both in onshore and offshore and lower prices partially compensated by lower windfall tax. In the US, EBITDA increased 35% to $286 million, with better wind and solar performance and also some timing effects helping EBITDA growth, despite the fact that in Q1 of 2024 was positively impacted by the Arctic blast storm, one-off of $37 million. In the rest of the world, EBITDA grew 25.3% to 229 million euros, with a 76% higher offshore production due to the gradual entry and operation of Sandbrück in France and Baltic Eagle in Germany, both of them offshore wind farms. In Brazil, EBITDA decreased 40% to 254 million reais, with lower thermal contribution from ThermoPay, our only GCGT in operation, compared to a strong 24 first quarter. Finally, in Mexico, EBITDA reached 144 million US dollars, 93% lower contribution compared to last year. That included the thermal asset capital gain, and only 17% excluding this capital gain, as the remaining business was favored also by some indemnities of past costs. Depreciation and amortization and provisions grew 2%, driven by a higher asset base in networks and new operating capacity in renewables, partially compensated by lower depreciation of around 30 million thanks to full year 24 adjustments and lower bad debt provisions in Spain and in the UK. EBIT reached 3.2 billion euros and grew 17% on unadjusted terms. Net financial results improved 16 million to 508 million euros thanks to non-debt related costs that improved 91 millions mainly linked to the FX derivatives that we usually close at the first part of the year due to our P&L hedges. This is more than offsets the debt-related costs that grew 75 million euros due to the higher average net debt, while interest-related costs have been compensated by the FX due to the depreciation, especially of the Brazilian real. Our reported credit metrics remain comfortable within ratios for BBBAA1 even after the ENW consolidation from March, mainly thanks to our cash flow generation with an 11% higher FFO of setting higher net debt, mainly linked to the mentioned 2.3 billion ENW consolidation and 0.8 billion FFO. called hybrid bond. As a consequence, our ratios remain strong, and we expect to remain in these levels by the year end. FFO adjusted net debt reached 22.3%, adjusted net debt to a bid that reached 3.5 times, and our adjusted leverage ratio was 47.3%. We are also expecting that, according to plan, debt will end the year around these levels. Net profit grew 26% to 2,004 million on an adjusted terms compared to 1.6 billion adjusted first quarter 24 net profit. Equity method includes 25 million corresponding to two months of contribution of EMW. while from March, as mentioned before, ENW contribution is already at the BIDDA level. In addition, financial results improved 3%, while our tax rate normalized to usual levels and minorities were lower as a consequence of the 18% avant-garde acquisition. Now, the Chairman will conclude the presentation. Thank you very much.

Pepe, following this first quarter result, in the coming borders, we expect to continue growing and reinforcing our financial strength. With net worth as main driver, thanks to a double-digit increase in our regulated asset base in just one year, reaching more than 51 billion euros, and the positive outcome on new rate cases, as we recently saw in Brazil. The clear outward trend in demand across all regions will reinforce the need for new infrastructure. It will benefit our energy production and customer business where we will have 4,000 new megawatts fully operational in 2025. With better wind factors expected in Northern Europe, especially in the United Kingdom, after a very low first quarter. In Iberia, hydro reserves are record levels of 9,000 kWh today, as Pepe mentioned, that will secure our production for the second half. Also, 100% of our production in the whole 2025 is already sold as agreed prices. All these factors will continue improving our cash generation after 11% growth achieved in the first quarter. New renewable assets in operation will contribute additional costs in the coming quarters and reduce our work in progress in these businesses. And we will increase the share of investment in network projects that generate cash flow from the AR1 project. Additionally, we expect to continue our asset rotation in line with the plans, following recent transactions like the sale of main natural gas and the partnership with Kansai in our Windacker offshore wind farm in Germany, cashed a few days ago, which will allow us to continue executing our investment plan as preserve our financial strength. As a result, today we reaffirm our net profit guidance of mid to high single-digit growth, excluding capital gains from national rotation, even without considering the positive impact already mentioned from the recognition of past costs in the US. If we include this impact, we expect to reach double-digit growth in net profit in 2025. with progressive acceleration of the second half of the year. This will result in a very different quarterly profile compared to last year, especially in reporting net profit, given the strong impact of the capital gains from the divestment of thermal generation in the first quarter of 2024. I expect to accelerate this growth over the coming years. In the current macroeconomic scenario, all governments are looking for substantial economic growth, and this is driving massive investment infrastructure, especially in sectors with the lowest exposure to global trade dynamics such as electricity. As we saw last month in a week conference in Houston, or during the summit jointly organized by UK government and the International Agency in London last week, we brought together more than 60 governments and the largest global energy companies, including Iberdrola. Energy security has become a decisive component of national security, compelling all countries to prioritize energy autonomy. And as we have been saying, electrification is the right answer to this global energy challenge, to this potential, to reduce external dependency, geopolitical risk, and price volatility linked to fossil fuels. increase security and self-sufficiency, improve competitiveness to the higher efficiency of electricity compared to other sources of energy, and promote local industries and jobs across the supply chains, and deliver tangible benefits in terms of affordability and price stability thanks to the market mechanisms such as PPA or CFDs. Iberdrola is optimally positioned to provide long-term growth in this scenario, building in our track record of more than two decades of sustained increase in resulting dividends, driven by a clear strategy focused on regulating networks and a select approach to renewable investment, with supply chains secured thanks to the anticipation of procurement needs and established relationships with major suppliers of the industry. and benefiting from our geographical diversification with US and UK as our key growth drivers and with a strong presence in continental Europe, Latin America and Australia. Markets in which our scale and relevance allow us to have direct and fluent relationships with key suppliers, financial institutions, government regulators. We will continue combining growth and financial strength thanks to cash flow generation, our active debt management, and our asset rotation strategy, allowing us to reinforce our strong financial position or our triple B plus rating. We will continue to report on all this development in the coming quarters. So thank you very much. Now I finish for your attention, and now we are ready to any question you may have. Thank you.

Now starting with the Q&A session, I would like to introduce the following financial professionals that have asked the upcoming questions. Gonzalo Sánchez-Bordona, UBS. Fernando Lafuente, Alantra. Alberto Gandolfi, Goldman Sachs. Manuel Palomo, BNP Paribas. Meike Becker, HSBC. Rob Pulley, Morgan Stanley. Philippe Orpatian, Odo. Pedro Alves, CaixaBank BPI, Jorge Guimaraes, JV Capital Markets, Javier Garrido, JP Morgan, Javier Suarez, Mediobanca, Fernando Garcia, Royal Bank of Canada, José Javier Ruiz, Barclays, James Brand, Deutsche Bank, and finally, Andrew Mulder, Credit Side. The first question is related to the, can you please provide a little more clarity on the net profit guidance for the end of 2025?

So the guidance I mentioned is we reaffirm our mid to high single digit, excluding the past cost recognition of the US. Including this impact, we expect net profit to grow a double digit. In all cases, guidance excludes capital gains from national rotations.

Second question, as well on guidance, could you please explain which are the key elements which will provide the meat to high single-digit growth for this year?

So I think the first one is action taken during the past 2024. So I think we take certain action, a certain decision, which is affecting positively 2024. I think we have already things, electricity transaction, The full acquisition of ungrid minorities last year. Efficiency measures that we took already during 2024. And of course, I think in 2025 is our organic growth. Higher regulated asset base in all countries with a spec surpassed to 51 billion, as I mentioned before. More than 4,000 megawatts of new capacity operating, contributing to EBITDA. And I think we expect that that is going to continue during the second part of the year. But nevertheless, Pepe, you would like to provide more detail, you can already provide more details of this.

Yeah, well, as the chairman has said, we are expecting, if you look to the numbers and you multiply by four, we are expecting more than 150 million euros coming from the contribution of E&W. We are also expecting an additional over 100 million euros coming from the recurring net profit of the full ownership of Avangrid. And also, you know, an improvement in net profit due to lower operating and depreciation expenses linked to the 24 adjustments that we did, as you can see in this quarter, that was giving us 30 million euros. of lower depreciation expenses. So, all in all, this supports what the chairman has been commenting.

Next question is related to the blackout occurred on Monday in Spain as an unprecedented event. Could you please give us your opinion on what caused it and if it is possible that an event like this happen in Spain again?

So, the reason of the blackout must be clarified by the responsible of the system operator, Red Eléctrica de España. I think I have my own ideas as engineer, but I think here is not a question of engineers to engineers. I think the system operator has to clarify because they are the responsible of this one. What I can say is that before, during and after this blackout, our generation fleet was ready and at the disposal of Red Electrica, the system operator, to enter in operation as soon as we received the instruction from the system operator. And I think our people, as I started to mention already, did a great job working and restoring the service, which normally takes a longer period in a very, very short period of time. So I think I would like to say it again, to congratulate, recognize The work already done by more, almost 2,000 of our employees, are dedicated to a huge effort to restore a service which is, as you mentioned, an unprecedented situation.

Next is related to the business in the U.S. Has the recent measures taken by Trump's administration changed your view on the country? Can you please provide your view on the future of renewable projects in the U.S., including the IRA?

We have been in the U.S. for more than 20 years. I mentioned several times. We have increased investment with all the administration, also during the previous Trump administration. Today, we have more than $50 billion in assets in the United States. We are present in 24 states. And in distribution, we are in New York, in Connecticut, in Maine, in Massachusetts, and serving almost 10 million Americans. So I think we have a very deep presence in the United States. Since the last election, we have invested more than $6 billion in the United States, including $2.5 billion in avant-garde minorities and $2 billion in the capital increase that we make afterwards, more than $1.5 billion in organic investment, almost $1 billion in the last three months, making the US our first investment destination, as I mentioned before, together with the UK. Over the last months, I have the opportunity of meeting Secretaries of Interior and Energy and the Undersecretary of Energy as well. And all of them said clearly the U.S. is totally focused in promoting infrastructure investment. And this will draft This will drive massive investment in networks. I think that is our main business is networks. 80% of our grid results come from networks. Huge opportunities in this segment. I think we are expecting more than $20 billion up to the end of the decade in New York, Maine, and Connecticut for already investing in the grid, in the infrastructure. And as well, they need more power generation. And this power, in this moment, we have 10,000 megawatt in operation with production sold through long-term PPAs, high quality, very good, let's say, pipeline for making move. And we will make more power or less power depending on the market condition. If the market condition is attractive, we will invest more in power. If the market condition is unattractive, we invest less. But I think the ambition of the American government and the American officials I have already met is that they are welcoming investment either in power or in new infrastructures. And we are a special infrastructure. We are very, very well located in the country.

Next is regarding the U.S. too, despite the slide we've shown. Do you have an estimation on the impact in your accounts of the new tariff that the U.S. are imposing?

As I mentioned, the new tariff has not impacted our results. I think they have impact in terms of CAPEX. The impact in CAPEX is very limited. It's less than 1% of our total group planned investment in 2025. So this impact is fully covered by our standard contingency in all the projects, allowances. And we have also agreements with our suppliers to reduce this amount in an important manner. I think the numbers I shared with you before in generation and in power, maximum impact is $130 million. It's less than 10% of the total investment plan in the United States. And we expect to reduce that by the final part will be much lower because of the agreement with suppliers. In the case of networks, I think no impact. First, because 99% of networks purchased are local. But also, I think whatever cost is protected by pass-through in the right cases. And I think in the case, I think those are the main things.

Next is regarding the energy production and customer business in Spain, basically, that has had a lower contribution in this quarter than last year. Can you provide some color on how it will contribute along the whole year?

Okay, so in January and February, we have lower hydro and wind production, so we have to purchase electricity in the market. The situation has improved since March, and we expect this performance to improve over the year. As the chairman has said, around four gigawatts of new capacity to come into full operation along the year, and very good hydro resources in March and April, allowing us to have reserves of nine terawatt hours, and also better wind factor.

Next is, do you expect any impact on your offshore projects in the U.S. from the U.S. government decision to stop the construction of several offshore power plants from competitors?

I think the construction is progressing well after some incidents we have already had in the last few months, technical incidents. We expect to have finalized before the year end. In this moment, we have several turbines exporting energy to the grid. So I think it's in operation partially. And we have almost one-third or almost a bit more full in exporting electricity by summer. And we are confident that I think that will be fully completed by the year end. And the relation with BOEM and with EDS is very fluent in this moment.

Regarding the nuclear debate in Spain, there is any change or any new news on it?

So I think I repeat systematically I'm already an electrical engineer and I think as an electrical engineer I already repeat that many times. The nuclear plants in Spain are efficient and unsafe and also not only efficient and safe but I see as well according with the recent report published by PricewaterhouseCoopers they are the least expensive solution to secure system stability. So for this reason, countries like France, UK, Germany, a billion in Europe and other countries in the United States or Korea or Japan or China and others are already just beating on them. In any case, and I would like to encourage that one, energy policy is responsible for the governments. I think we are already following the decision the governments are taking. So the fact, I think last week, as probably you know, it was in London, a summit called Energy Security Summit. organized by UK government and international agency, with the presence of the prime ministers of Britain, representatives from 60 countries, and even the president of the European Union Commission as well. And the ministers and the members of the different delegations were debating the different countries' policies to secure the energy supply in their own countries. I think that is clearly the energy policy is responsible to the governments, and I think we have to follow the instruction of the policies with the government decide. But the final responsibility is government responsibility on the energy policy.

Next is about the UK and the solar pricing that could be or is being talked about these days. What is your view on the subject?

As well, in the last week summit in London of Energy Security Summit, I had the opportunity talking with the Secretary of Energy at Milivan. I had the opportunity of meeting the Prime Minister, Keir Starmer. And I think all of them confirmed that the most important thing for the country is growth. And for growth, they need to attract investment to foster this economic growth. That is the top priority for the government. And for that, stability, predictability, and attractive regulatory framework is absolutely crucial. I think that was insisted in public and probate for all people, not only the government. The British government, it was said the same thing as well by Ursula von Leiden. It was said by different ministers attending the summit. The CEO of OJEN also recently said in a speech that the UK regulator is aware of the risk of sonar pricing for investments. So I think you leave both things. I think it's in this moment. And for this reason, in my opinion, I don't think that that is a priority. And I don't know if this reform will be implemented in the short term or even implemented in the long term as well.

Next is can you share details or new details about the new regulatory framework for networks in Spain?

As far as I know, the process continues going. We expect to be finalized before the year end. I think that is the expectation we have. Nevertheless, I think in the countries where we are present, in Brazil, United States, UK, we represent more than 90% of our regulated asset base, are increasing investment plan. And modifying remuneration models to make them more attractive. And I think, I expect that Spain will do so as well. So I think all countries are already asking for more investment. All countries are already making already regulatory framework more attractive. You saw already what is already happening in Brazil in the last review of Pernambuco. And I think it's because everybody is willing to invest more there. I think investments are needed, but I think we expect that Spain is going to do the same thing as well as we've been doing in terms of the countries. Nevertheless, I said that 90% of our regulatory base is in different countries than Spain at present.

And last question is related to the estimation of the impact of the FX in our accounts and if we can provide some information on our hedge strategy and FX as well. Pipi?

Well, as you know, we traditionally hedge our results in the year. So basically, right now at the net profit level, we are not expecting any impact. We have been able to hedge the results, especially in the dollar, at very good levels, as you have seen previously. That generates some derivative capital gains that we have shown in this result. So basically, we are fully covered at the net profit level.

Having finished the Q&A session, now please let me give the floor to Mr. Gallant to conclude this event.

Thank you very much as always for your participation in this call. Our investor relation will be as always ready and available for any additional questions you may have. Thank you very much and see you soon. Thank you.