Enel, the Italian energy powerhouse, has made headlines by significantly increasing shareholder returns following a remarkable profit growth in 2024. The company's attributable net income soared to 7.02 billion euros, a sharp rise from 3.44 billion euros recorded the previous year, and notably surpassing FactSet's consensus estimate of 6.86 billion euros.
This exceptional performance can be attributed to strong operational execution and a reduction in net financial expenses, particularly fueled by gains from markets in the United States, Spain, and Latin America, which balanced a slight downturn in Italy's performance. However, despite this impressive profit, the company faced a decline in revenues, falling to 78.95 billion euros from 95.57 billion euros.
This drop was largely driven by decreased thermal energy production and lower electricity and gas sales amidst less favorable pricing in end-user markets. Nevertheless, positive trends in revenues from the renewable energy sector and distribution grids partially mitigated these losses. Among its various sectors, the thermal generation and trading operation experienced the most substantial revenue decline, plummeting 39.6% to 24.28 billion euros.
Conversely, Enel Grids and Enel Green Power demonstrated robust growth, with increases of 14.7% and 5.1% respectively, cumulatively reaching revenues of 23.24 billion euros and 12.22 billion euros. These gains were supported by an uptick in hydro, solar, and wind energy outputs in diverse markets including Italy, Spain, Colombia, and Brazil, in addition to revenue generation from new plants in North America and the sale of distribution assets in Peru and Italy.
In a strategic move to enhance shareholder value, Enel's board announced an increase in the total annual dividend to 0.47 euros per share from the previous 0.43 euros. Shareholders can expect a payout of 0.255 euros per share on July 23. Moreover, the board expressed its intent to initiate a share buyback program of up to 500 million shares, valued at approximately 3.5 billion euros, pending approval at the annual general meeting scheduled for May 22.
Looking to the future, Enel projects to achieve a net ordinary income ranging between 6.7 billion euros and 6.9 billion euros in 2025, further aiming for a target range of 7.1 billion euros to 7.5 billion euros by 2027, with plans to sustain a dividend of 0.46 euros per share during both years. Despite the positive developments, the company saw a minor decline in stock price during midmorning trading on Friday..