Redeia Corp U/Adr

Good morning, ladies and gentlemen. We're starting our earnings call for 2025 and the new strategy plan for the period 2026-2029. We bid welcome to all attendants via telephone and our webpage. With us are Beatriz Corredor. chair of the board of directors, Roberto Garcia Merino, chief executive officer, and Emilio Cerezo, chief financial officer. I now give the floor to our chairwoman, Beatriz Corredor. Thank you very much, Sol, and good morning, everyone. First, I will start by highlighting the most notable events of 2025, and then our CEO, Roberto, will go deeper into the year's figures and discuss the close of the financial year. I will later refer to the environment in which the Board of REDEA brings this strategy plan And once more, Roberto will go into deeper detail on it. And as usual, we will conclude with a question and answer period to address any of your queries or concerns. So, as I said, let's get started with the 2025 highlights. From an operational viewpoint... we can say we've made great progress with a record of investments in TSO, exceeding 1.5 billion euros, or 40% more than in 2024. A record figure in our 41-year history, and it's almost a four-fold increase in the investment rate in nearly four years. This effort includes the $1.4 billion invested in the transmission network, with 486 extra kilometers of circuit and 217 new positions to strengthen the network and facilitate the country's industrial and productive development. Moreover, the availability index of the National Transmission Network operated by RevElectrica sits at 98.39%, exceeding 98.06% achieved during 2024. It is therefore clear that 2025 was a key year, also from the regulatory point of view, as the CNMC published the remuneration letters for the new regulatory period going from 2026 to 2031. Also, the regulator approved the remuneration for the system operator for the 26-28 period. This, or with this, this financial year 2026 is expected to be better than the previous year as the current methodology takes the actual costs for 2024 and foresees a regularization based on actual data from 2025, which already has an impact on the 2026 bottom line. As for the transmission network, we believe it should be adequately remunerated during a time when the relevant role played by its reinforcement and its maintenance account for. Certainly, we were expecting further signals considering the effort being made in our infrastructure and will have to continue as you will see during the presentation. In the field of income and revenues in parallel, we've made progress on high-impact corporate milestones, including the completion of the Hispasat sale with a payment of $725 million for 89.68% stake that we had in the satellite company. As we have said before, this strengthens our financial position to continue enabling the energy transition in Spain. The European Investment Bank has become a key partner in this regard as they support us in funding strategic projects like the pumping station in Salto de Chira and the interconnection with France. In addition, we signed an extra 1.1 billion euros in loans with several entities, including a 300 million euro contract with the ICO and issued a half billion green fund. But if there is a relevant event in 2025, we're talking about the big blackout on April 24, an unprecedented, unpredictable, multifactorial incident, as acknowledged by all official reports, both from the European Experts Panel and from the Government Analysis Committee. These technical analyses confirm the sequence of events as described in the Systems Operators Report. All reports agreed that it was a serious unforeseen event, oscillations, generation disconnections, in some cases through shared evacuation structures, with healthy voltages within the limits of the transmission grid and inadequate voltage control service. All this led the incident to an unprecedented, as I said, incident, both at a national and international level. This comes from the technical rigorous analysis of data. there is no guesswork here and no generalization for this reason Red Electrica confirms that it operated the system correctly in strict compliance with the regulations before during and the blackout on April 28 because If there is a highly regulated industry in our country, that is the electricity sector, meaning that both the system operator and other parties involved must comply with the present regulation, which is obviously not approved by Red Electrica, but by the executive, legislative, or regulatory authorities after due procedure guaranteeing that all parties concerned are heard. And this is the case for the nook control operating procedure 7.4 on voltage control. which was requested in 2020 by Red Electrica and approved in June 25, now in the process of implementation, or the measures proposed by the systems operator for a sudden voltage variations control or the new functions recently assigned to the operator, which we take on with huge responsibility as a sign of recognition to the work and professionalism of our team. I will now give the floor to Roberto García Merino, our CEO, who will give you more detail on the financial results for financial year 2025.

Pasando ahora a valorar nuestra cuenta de pérdidas y ganancias, destacamos que en 2025 nuestros resultados han estado alineados con las expectativas que teníamos para el ejercicio, superándolas incluso ligeramente, mostrando una evolución positiva en las principales líneas de actividad y con un 89% de la grita del grupo procedente de negocio regulado.

And this has grown 4.2%, launched mainly by the increase of 71 million of this regulated in Spain. And this is due to the new financial distribution that was approved by the CMC and the new types of help that has been given have been adjusted by the lower maintenance units that we need to spend. And internationally speaking, we have gone down a little bit because of businesses in Chile and because of the exchange rate between the dollar and the euro that was compensated in other countries like Peru and Brazil. So the fiber optic business and the positive effect of the inflation of CPI linked contracts is offset by the renegotiation of some contracts in a context of market concentration. With regards to operating expenses, and without considering those that are offset by other operating incomes, including Salto de Chile, we see that the expenses grew 5.6% in the environment of increased activity and operational demands in line with the business growth and the network requirements. Personnel expenses went up due to a larger average workforce which was necessary to be able to meet the challenges arising from the strong growth of the group's regulated assets and also higher salary costs. Other operating expenses grew basically due to higher maintenance costs in Spain which have contributed to have a high availability rate for the transmission network. The EBITDA grew 4% driven mainly by a higher contribution from the TSO. Also, it is noteworthy that there is an improvement in international business, aided by lower operating expenses, as well as a strong performance of fiber-operated business, which combines higher revenues with more contained costs. The profit has reached €506 million, which is 37.2% higher than 2024, due to the impairment recorded in 2024, following the agreement to sell Hispat, while profit from continuing operations grew by 1.6%. We should say that the financial result worsened by 20 million due to lower financial income in 2025 compared to 2024, mainly due to the lower placement of cash surpluses. Corporate income tax increased with an effect rate above 25% due to the fiscal impact and dividends that were received from group companies that are not part of the tax base. From the financial perspective, the net group's debt is €5.4 billion at the end of the year, which represents an increase of €100 million compared to December 2024. The cash generation, together with the 725 million received from the sale of Hispat and dividends from the group, especially from Brazil, have helped us to contain the growth of that debt and continue to have solid financial structure with an EBITDA rate of 4.4 times and an FFO of net debt of 18.9%. With the results of 2025 and what we've already seen from the period of 21-24, we can say that we have exceeded all the objectives set out in our strategic plan for the period of 2021-2025, placing the company in a very solid position to tackle the challenges of the new strategic plan. The TSO investments have reached 4.4 billion, exceeding the initial target of 3.3 billion, ending with a historic figure, as was said before, of more than 1.5 billion of TSO in 2025. The BIPDA margin stood at a solid 75.8%. which also has complied with what was foreseen. We have a balanced financial structure with a net debt evicta rate of 4.4% and an FFO over debt of 18.9% and we have preserved an A- credit rating with both Fitch and Standard & Poor's. Finally, we have ensured a stable shareholder return throughout the whole period, and we've improved even the initial dividend distribution target. In short, we're closing this plan in 2025 with an excellent level of execution and a very solid position in order to face the next stage. Now I'd like to give the floor back to our chairwoman.