OUTLOOK 2020-2025

Iberdrola launches €75 billion investment plan to 2025 as a firm commitment to economic recovery

A total of 90 % of gross investment — 68 billion euros — will be organic. More than half (51 %) will be spent on renewable energies and 40 % on networks. Of this investment, 83 % has been earmarked for countries with climate ambitions and A ratings. These investments and efficiency (+1.5 billion euros) will drive the group's results to 2025 in EBITDA terms to 15 billion euros, while net benefit will stand at around 5 billion euros. The company's purchases, totalling more than 22,000 suppliers, will help to support up to 500,000 jobs in the world in 2025, as opposed to the current 400,000.

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OUTLOOK 2020-2025

Business Model and Strategic Pillars

Consolidating our successful business model

• Power decarbonisation
  • Offshore Wind
  • Solar FV
  • Onshore Wind
  • Pumped
  • Battery Hydro Storage
• Networks system integration
  • Automation
  • Smart Grids
  • HVDC
  • DSO Model
• Demand electrification
  • Transport
  • Buildings
  • Industry
  • Heat Pumps
  • Electric Vehicles

- More Renewable Energy

- More Networks

- More Storage

- More energy solutions for our Costumers

Building on the strategic pillars that have triggered 2 decades of sustained growth...

- ESG+F

1. Acceleration of Profitable Growth
2. Sustainable Dividend
3. Financial Strength

• Geographical diversification: countries with high rating and ambitious climate policies
• Energy transition: enabling decarbonisation and electrification
• Efficiency: continuous drive for excellence
• Portfolio optimization: contributing to the environmental and financial sustainability of our business model
• Innovation: laying the foundations for the future

... to accelerate value creation for all stakeholders in the new scenario

2020-2025 Gross Investments: Eur 75 Bn

Eur 68 Bn of organic investments and Eur 7 Bn¹ of PNM Resources transaction

• Annual Organic Investments (Eur Bn)
  • Average 2017-2019: ~7
  • Average 2020e-2022e: ~10
  • Average 2023e-2025e: ~13

Growth represents 75 % of total organic investments (Eur 50 Bn)

¹ Iberdrola estimates of PNM Resources transaction investment.

51 % of organic investments in renewables and ~85 % in Europe and the USA...

• Gross Organic Investments by Business (Eur 68 Bn)
  • Liberalised: 9 %
  • Renewables: 51 %
  • Networks: 40 %
• Gross Organic Investments by Geography (Eur 68 Bn)
  • Countries with credit rating greater than or equal to A²:
    • IEI Europe and Australia: 16 %
    • Spain: 21 %
    • UK: 16 %
    • USA: 34 %
  • Mexico: 2 %
  • Brazil: 11 %

...more than 83 % allocated to A-rated countries

² Under Standard & Poor's categorization

2020-2025 Operating Figures:

Renewable Installed Capacity 2x (GW)

• 2019: (7)/32
• 2022e: (7)/44
• 2025e: (11)/~60

(x) GW under construction by year end

With more than 20 GW of capacity in other generation technologies

2020-2025 Efficiency: ~EUR 1.5 Bn

Achieving efficiencies of close to ~EUR 1.5 Bn in 2000-2025, of which EUR 1 Bn in 2023-2025...

NOE / Gross Margin (-200 bps)

• Average 2017-2019: ~27 %
• Average 2020e-2022e: ~26 %
• Average 2023e-2025e: ~25 %

...NOE / Gross Margin ratio constantly improving, to reach below 25 % by 2025

2025e EBITDA: ~ Eur 15 Bn

EBITDA grows ~Eur 5 Bn from 2019 (CAGR 6-7 %)...

EBITDA (Bn Eur) (CAGR 6-7 %)

• 2019: 10.1
• 2022e: >12
• 2025e: ~15

...increasing the share of renewables and geographic diversification...

• EBITDA 2025e by Business (~15 Eur Bn)
  • Liberalised: 22 %
  • Renewables: 31 %
  • Networks: 47 %
• EBITDA 2025e by Currency (~15 Eur Bn)
  • Countries with credit rating greater than or equal to A³:
    • EUR: 40 %
    • AUD: 1 %
    • GBP: 17 %
    • USD: 30 %
  • BRL: 12 %

...with more than 80 % of EBITDA in A-rated countries

³ Under Standard & Poor's categorization.

2025e Net Profit: Eur ~5 Bn

Net Profit increase of ~Eur 1.5 Bn to reach Eur ~5 Bn in 2025 (6-7 % CAGR)...

Net Profit (Eur Bn) (CAGR 6-7 %) (~Eur 1.5 Bn)

• 2019: 3.500⁴
• 2022e: 4.000 - 4.200
• 2025e: ~5

...maintaining financial strength and solid rating

⁴ Net Profit 2019 restated for the recognition of the financial cost of the hybrid bond.

2020-2025 Shareholder remuneration

In a strong growth scenario, shareholder remuneration will grow in line with results

• Pay-out between 65 % and 75 % of EPS (our earning estimates would lead to a DPS in the range of approx. 0.53-0.56 in 2025)
• Increasing DPS floor:
  • 2020-2022: 0.40 Eur/share
  • 2023-2025: 0.44 Eur/share (+10 %)
• Maintaining optionality for shareholders with the "Iberdrola Retribución Flexible"
  program, including share buy-back

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