Iberdrola, S.A.

Networks represent approximately 50% of group EBITDA and earn regulated tariff-linked returns under multi-year frameworks in the UK, US, Spain, and Brazil, providing durable forward visibility. Contracted renewable PPAs add a second layer of medium-term predictability, though the Power and Customers segment retains meaningful exposure to wholesale electricity prices.

The group's two segments, networks and power and customers, provide some diversification by regulatory nature (regulated returns versus market-exposed), but both operate within the electricity value chain and share a common dependence on energy demand. With networks representing roughly half of EBITDA and power and customers the other half, the split is balanced but not across genuinely uncorrelated end markets.

Iberdrola generated 81% of FY2025 adjusted EBITDA in A-rated countries, with meaningful contributions from the UK (1,595 million pounds networks EBITDA), Brazil (13,837 million BRL networks EBITDA), Spain, and a growing US platform targeting 16 billion euros in investment through 2028. No single country dominates at the EBITDA level, though the US and UK together account for 60% of planned capital deployment.

Network distribution and transmission are inherently capital-intensive: the 58 billion euros investment plan through 2028, with 62% directed to regulated networks, demonstrates that revenue growth requires proportional capex deployment. Operating leverage is structurally limited by the ongoing need to invest in grid infrastructure to secure and grow regulated returns on the 51 billion euro asset base.

Regulated network revenues are mission-critical and non-discretionary, with tariff frameworks in the UK, US, Spain, and Brazil setting returns on the 51 billion euro regulated asset base. The renewable generation fleet is substantially covered by long-term PPAs, though residual merchant exposure in the power and customers segment introduces some transactional revenue that tempers overall quality.