Ren - Redes Energeticas Naci Stock

Good morning, ladies and gentlemen, and welcome to REN's First Half 2026 Results Conference Call. We appreciate your time and availability this morning.

Joining us today are the members of REN's Executive Committee, Rodrigo Costa, our CEO; Gonçalo Soares, our CFO; and João Conceição, our COO. Rodrigo will open with his opening remarks, and then this will be followed by a detailed overview on REN's operation and financial performance. Following the presentation, we will open the floor to your questions.

Thank you again for your attention and continued interest on REN.

Well, thank you, Madalena. Good morning all, and thanks again for being with us today. This is the call that -- it's just before the holidays of most of the people. As you probably saw, we had another good quarter, both from operational and finance perspective in Portugal and also in Chile.

This time, we don't have any major event to report on. And today, the introduction will be really short. And I believe we are making very good progress in all fronts, and we will go through the details. And now Gonçalo takes the lead.

Thank you, Rodrigo. Good morning to you all. So I'd say another set of good and solid results. We are delivering on the strategic update that we made to you on March of this year, say slightly ahead of that estimate.

On Slide #4, you have the key messages. So EBITDA grew almost 11%, 10.8% to be more precise, mostly on the back of strong domestic EBITDA, which is mostly driven by the new regulatory framework in electricity, but also some contribution from international operations.

On net profit and building on that, you also see good growth also because of improving financial results and mostly because of tax impact, not only the levy in gas that went away, but some court gains that we made from previous decisions and recuperation that we are making on the levy. So here, we should clearly expect growth, but don't expect this kind of percent-wise growth -- percentage growth for the full year.

In terms of net debt stability, most of the debt is basically in line. Average cost is coming down a little bit also on the back of improving rating. On CapEx, we are delivering the growth that we have been promising. CapEx has increased around 23%. So also transfers to RAB have also increased. And this despite the fact that we have very strong storms, the Kristin storm at the beginning of the year, operating teams made an incredible job, and we're able to continue to work also on other fronts and deliver this growth.

Let me just pass to João that will give you a brief update on what's going on, on more of the operating side. João?

Thanks, Gonçalo. Good morning to you all. On Slide 5, you have the key message from the operational perspective. I would highlight the fact that on the electricity grid side, the Portuguese system maintained a very high level of renewables penetration, slightly above 70% of the total consumption in the first semester of 2026 was generated from renewable sources, with approximately the same distribution per technology as the previous years, 2025.

We keep seeing the consumption to increase around 3.5%, and that's the expectation -- approximately the expectation we have for the following months. Meaning that this is in line basically with the plans that we foresee and the need for additional infrastructure as we presented in our investment plan.

On the natural gas side, you see here an increase on consumption of 6.1%. That's mainly driven by the usage of natural gas for electricity generation and that derives from the fact that we were forced to introduce some combined cycle plants into the system for security of supply purpose just after the last year event, the blackout in 28th of April as well as the storms like Gonçalo mentioned, the Kristin storms that we had in Portugal in January 2026.

Another point to highlight related to the blackout is the fact that the Portuguese regulator classified the blackout as an exceptional event. We were kind of expecting this classification, and that's quite important because it accounts for our quality of service indicators. We also see another aspect that is relevant from the operational perspective is the fact that the Portuguese government launched the consultation and the plan, the strategic plan for storage, which again will put some extra needs for CapEx within our infrastructure.

And moving to Slide #7. Basically, you have the different indicators apart from the consumption, which I mean the renewable share, which I mentioned, I would just highlight the fact that we keep the very high levels of quality of service. Even though you have an average interruption time on electricity significantly higher than the previous year, that derives from the fact that we are considering in this 3.41 minutes, the impact of the Kristin storm, although we are also expecting this to be classified as an exceptional event.

And if that is the case, this won't count for the indicators and the interruption time reduces significantly to 0.01 minutes, perfectly in line with the previous years. On the natural gas, the levels of quality of service are kept at the high level as previous before.

And with that, I pass to Gonçalo.

João, thank you. So on Slide #8, just the main highlights. I think I've gone through this, the increase in EBITDA, the increase of 42% in net profit, net debt stable.

So moving on to Slide #9 in EBITDA. You can see that most of the increase comes from the asset and OpEx remuneration, and this is basically the increase in new regulation in electricity. There's also an increase in the semester of the incentives, which at year-end should actually be slightly lower than we had last year as they are a little bit more challenging to achieve and that we actually made the expectation to you. So this will probably slightly be lower at the end of the year, but the logic is the same. The costs are increasing mostly by personnel and some other external costs, which are also included partially in additional OpEx allowances that you see on the asset and OpEx remuneration, okay?

The International segment delivered well. And so what you can see is electricity growing and surpassing clearly 2/3 of what is the weight in EBITDA. And you also see the international growing close to 6%. So still a small number as we like to keep it, but growing at a good pace.

In Slide #10, you see basically the increase of rates in electricity, although rates do are coming up a little bit. So probably the rates of return on the assets at the final -- when we determine them in 30th of September will be slightly higher, but not very much higher, but slightly higher than what was initially estimated at the beginning of the year.

In terms of 11 -- of investment, I'm sorry, in Slide 11. As you know, it's still early, but I think that despite the fact, as João was mentioning that we have the Kristin storm and that we have all of the operating teams in the field, the fact that we are still delivering strong CapEx and we are still delivering strong transfers to RAB is a very positive sign. So we are, I'd say, very optimistic and very constructive in looking at the full year. We -- I'd say, a nice double-digit growth in CapEx versus last year, which would -- versus 2024 because last year, you had some, I'd say, special CapEx in Chile. But if you compare it to 2024, you would have, I'd say, significant increase in CapEx versus that year, okay?

In terms of RAB returns in Slide 12, a little bit what you already know. So the normal dynamic in these several segments, nothing to add here.

Let me just move to Slide 13 to comment on OpEx. So I'd say that this is in line. We are still going after and controlling OpEx quite well, but the business is growing. So it's normal that OpEx growth. This is basically on personnel driven by more people and some normal general increases. And in core external, it's basically tied to maintenance costs and IT costs, which are then protected also under the regulation. It's normal that in the first year of regulation, the spread and these are a little bit and you are not still recuperating what you want to recuperate in terms of external costs, but this is going to be quickly being recuperated through the regulatory framework, okay?

In terms of international in Slide #14, I'd say, solid results. So Transemel growing a lot, but this is mostly also -- not only but mostly because of the small acquisitions that we made last year. So everything completely already internalized. The assets are already functioning well. And the -- I'd say, the normal assets that we have in Transemel are also progressing quite well, and we are in line to keep the investments and to be able to fulfill the investments that we had planned for Transemel this year in Chile.

In Electrogas, you see very small decreases year-on-year. But the reality, to be honest, is that we are optimistic on this business. We are seeing a renewed push for increase in the gas imports from Argentina, and there may be some growth here also in the coming future. So I think that this is also a segment that although not as sexy and although not having as much growth as electricity is also performing quite well and could actually have some growth in the coming years.

Looking at below EBITDA. So depreciation basically in line, nothing there to add. In terms of financial results, there is an improvement. This comes from several sources. First, because we are receiving interest from the levies that we are winning in court. So that's important. Second, because net debt is slightly lower and in line. Third, because we are able to decrease a little bit the average cost of debt.

Bear in mind that the average cost of debt may increase now again because we are seeing increases being implemented by ECB. There may be another increase in September. So although we issued very well at the time that we issued in February, there may be some pickup. But the fact is that we -- the improvement in the ratings that we are also -- now seeing also is helping us insulate from these increases and is helping us control and maintain the cost of debt at a very optimized level.

In terms of taxes, basically, the story is, one, the elimination of the levy in gas that we already have this year. So it's the EUR 10 million less. And secondly is the recuperation that we are seeing. We have this recuperation of EUR 4.1 million already in the accounts. Although nothing changed structurally in levy. So we have no news. We didn't have any court case in electricity that would be interesting to tell you.

But what we are seeing is that the court cases in gas are slightly accelerating the dynamics. So we are seeing more court cases being out. So we already recognized. It could be that during the year, we will recognize more things until the year-end relating to court cases of gas and recuperations in court, okay?

So in terms of net profit, all of this in Slide 16 put together, so strong EBITDA, strong financial results, strong tax recuperation, okay? All of these make this 42% increase. As I said, we are not expecting this -- we are expecting an increase, but not this increase for the full year.

On Slide 17, in debt, everything very much in line. So net debt actually evolving positively quite well. Part of it is because of tariff deviations that are now at a very low level. And also because we are still in the dynamic of receiving and implementing the solar agreements. This other line that you see here is mostly related to that. So we are receiving sometimes the CapEx we do a few months later. So this is also kind of a timing issue as João's teams are building and implementing the solar agreement CapEx that we have in line, okay?

So net debt very stable, maturity stable at 5 years, a lot of liquidity still. So controlled cost debt. So we are very comfortable with our funding position. We are seeing improving ratings. So we are clearly building flexibility here also at the net debt level, okay.

Slide 18, just the share price is going up. Now in the last few days have come down a little bit. So I think we are still performing well with the market, but this is kind of going up and down the normal dynamic, nothing here to add.

In terms of the ESG, just on Slide 20, just to repeat, and this builds on the comments that João made. So the most interesting here is that you see the greenhouse gas emission growing a little bit around 3%, the Scope 1 and 2. This is driven by what João explained, the security of supply issues and measures that we took. So they made this increase. We are expecting this to level off a little bit more on a full year kind of one, okay?

I'm not going to go through the detail of Slide 21. Slide 22 with the ratings, you are basically seeing that improvements are getting smaller. So I think we did a lot of job. We are still investing a lot of time and resources in this -- in ESG, but the results in terms of ratings are going to be slightly smaller because we are getting to higher level, okay?

So in terms of closing remarks, just to tell you on Slide 24. So this is basically what we've been and what we told you in the update. In EBITDA, we are seeing the positive impact of the constructive regulatory framework in electricity. In net profit, and building on that, we see the impact of not only funding, but also of the tax recuperation that we knew.

In CapEx, we are seeing the growth that we promised to deliver. In net debt, we are basically seeing the strong balance sheet that is enabling improvement in rates. What you can also expect and what we can also tell you is that versus what we told you in March of this year in the strategy update, we are delivering. We are comfortable with the EBITDA interval that we gave you and with the consensus that we gave you.

We are actually very comfortable with the net income consensus and the interval that we gave you on that. And on CapEx, we are also very comfortable with the interval, and I think we'll probably be closer to the upper range of the level that we gave you on that interval rather than to the middle, okay? So I think we are delivering well on what we promised you.

And with that, I conclude and I open up to any questions that you may have. Thank you.

[Operator Instructions] And the questions come from the line of Alessandro Di Vito, Mediobanca.

I have 2. First one, I understand that you are comfortable with the ranges that you provided with the strategic update. That said, the net income of first half is a little bit ahead of the midpoint of the range that you provided. So I wanted to understand whether do you see maybe some upside at bottom line at full year? Or should we expect some seasonality maybe in the second half? And if yes, what could be the explanation of that?

Second question, I would be interested if you could provide some color on the consultation on the electricity storage that you mentioned at the beginning of the presentation. Specifically, if this could be also an opportunity for you or if this, let's say, this segment would be only focused for liberalized operators?

Okay. So on your first question, I think that everything that we have on the update is kind of coming out as we planned. So all of the impact of regulation, all of the CapEx, everything, all of the costs. I think what makes it be a little bit ahead or not also may be the tax recuperation. So if they happen faster and they fall, that's a timing that we don't control when they happen.

So if they happen at, I'd say, at a faster pace, we may beat a little bit the number that we gave you. If they don't happen so fast, we may -- so it's not that it's anything structural with the business that would make you. But yes, there is a possibility of an upside versus the interval that we gave you. So that's why I told you that we are very comfortable. But most of it is, I'd say, is driven by this reason.

João, do you want to comment on the storage?

Sure. Thanks, Gonçalo, and thanks for the question. Well, regarding the -- what has been announced by the government is a push both on chemical storage, so the usage of batteries, what considered to be the short-term storage, but complemented by what they consider to be the long-term storage, which is pumping storage. So they have some targets for that was announced, more short-term targets for the batteries, medium, long-term targets for the pumping storage.

The storage are -- is supposed to be developed by market agents and market operators. So it's not considered to be something that is under the operation of the system management or the network operator. Having said that, in order to connect this new capacity, we will be obliged to develop extra grid elements, and we will be obliged to increase our CapEx so that this capacity is fully connected to the grid.

[Operator Instructions] And the questions come from the line of Fernando Abril-Martorell from Alantra.

It's only one since the battery, the storage plan has already been answered. It's about -- I'm not sure your involvement, but it's about the Zonas de Grande Procura process that is being held at the moment, I think, in Portugal. So I don't know if you can give us some color about this process? How is it going and the amount of connection capacity requested versus what is currently available? And well, broadly speaking, the implications that this process may have to you and the investment targets.

Thanks for your question. Actually, this is the second formal process that the Portuguese system launched. The first one was very much spotted to the industrial side of Sines. The second one is covering all the countries. So this is what they call the national high demand areas, I would say, translating directly to English.

There was several market agents and operators, consumption and data centers and so on that presented their interest. This goes through a relatively straight procedure of providing guarantees and to reinforce the need for these connection points. In parallel, we are supposed to -- and we have already presented that to the government, the needs on extra CapEx to create the necessary conditions for all these players to connect.

So we are at the stage, and it's not public yet. We are at the stage of closing the procedure by making the necessary connection agreements with these consumers. And in parallel, waiting for the decision of the government regarding the CapEx that -- the specific CapEx that we have announced.

Can I just follow-up a very quick one? It's just about the timing. So when do you expect an update on this process? Maybe after summer or maybe it may take longer?

Well, ideally, after summer, but there are some timings that we do not control, namely the decisions from the government. But ideally, I would say, in the third quarter, we are supposed to be closing this procedure.

We have no further questions at this time. So I'll now hand back to you for closing remarks.

Thank you all. If there are no further questions, we would like to end. Thank you again for your time and availability. We remain available to take any other questions offline. And we wish you all a very happy summer break. Thank you.

Thank you.

Thanks.

Hello. Good morning, ladies and gentlemen. Thank you for attending REN's 2025 Results Conference Call. Joining us today are the members of our Executive Committee, Rodrigo Costa, our CEO; Goncalo Soares, our CFO; and Joao Conceicao, our COO. Rodrigo will start with his opening remarks, and Goncalo Soares will guide you through the main operational and financial highlights of the year.

In addition, we will also provide an update on our strategic priorities for 2026 and 2027. After the presentation, we will open the floor for a Q&A session, and we're happy to take your questions. Thank you very much.

Thank you, Madalena. Good morning, all. 2025 was a very challenging but a good year both from an operational perspective as well as a financial perspective. We believe we did quite well and achieved very good results.

On my notes regarding 2034, just a year ago, I did a list of the challenges we went through in the last years and there were many. We had COVID, we had a lot of local political turmoil, we had the beginning of the Ukraine war, we had a spike on energy prices, critical drought for a couple of years. And of course, the usual licensing processes delays to develop infrastructures and some challenges in the front of regulation and also high taxes. In '25, we had a blackout in Spain that took our system down. We had multiple storms because not just the ones we had very recently, we had them also in the fall of last year. And of course, with all these, we have been quite busy.

But the truth is that we have been consistently delivering in our plans. Quarter after quarter, the numbers speak by themselves. We keep delivering consistent results and meet the expectations. On top of the good operational and financial work, we saw some important progress with [ sale ]. Also on the tax front, we were able to take advantage again of a regimen that is now more favorable to business. We are also doing well in Chile, developing the business according to the plans you are aware. We believe that our sector remains very interesting and full of opportunities. Our government remains committed to the energy transition, and that's, of course, is quite positive for us.

Energy is at the center of the world development and we are core for that development. We are a catalyst of the energy position, and we are doing what we are supposed to do, developing projects, managing existing infrastructures and being efficient and persistent.

And with that, I will move to Goncalo.

Thank you, Rodrigo. Welcome to you all for the 2025 results presentation. Moving to Slide #4. So I think that's -- what you have before you is a set of very positive results that consolidate the year 2024, clearly ahead of the business plan that we have a defined for you that year. EBITDA is growing 2% this year around that, this is both on the back of growth in Portugal and in Chile. Net income is growing a little bit more almost 5% and this is the result not only of the increase in EBITDA, but better financial results and stable taxes so almost EUR 160 million of this growth of 4.8%. Net debt is stable, but we are improving metrics as the recent upgrade showed you. In terms of CapEx, the signs of acceleration, we are increasing CapEx and this is something that we are going to maintain, but this is already a positive sign as Rodrigo mentioned.

But before I go into a little bit more detail, let me pass to Joao, our COO, so that he comments more on the operating side. Joao?

Thanks, Goncalo. Good morning to you all. On Slide 5, you have the summary of the main points from the operational perspective. And I would highlight the last one on the regulation point, which is the new regulatory framework for electricity. We will go in more details later on in the slide. But to tell you that we've got an improvement versus the previous regulatory framework on the different components. The most important one, the rate of return, which has a starting point of 6.19% base rate, plus incentives and plus some other upsides that we will detail later on.

Jumping to Slide #7, you have the main indicators. I would highlight the fact that we increased the electricity consumption by 3.2% versus last year, and this 53 terawatt hour overall, the 2025 was the highest consumption ever registered in the Portuguese electricity system. Renewable share is approximately the same as the one we got in 2024. There is a slight decrease, and the reason is very simple. As you might remember, we had these blackouts on the 28th of April. And after the blackout, we were forced to generate some electricity with combined cycle plants in order to ensure the necessary levels of security of supply of the system. This is something that we are evolving that affected the renewable share. And it's the reason of the increase on gas consumption of 11.1%, which is basically justified by this increased need of generating electricity with gas sources.

In terms of quality of service and in summary, nothing special to report. We were in line with the previous years. Obviously, considering the blackout as a special event, not affecting the necessary indicators for quality of service. And with that, Goncalo, I give back to you.

Thank you, Joao. So Slide #8 is just the main financial slide. And let me just go through a little bit more detail in them. So on Slide #9 in EBITDA, what you can see is this increase of 2%. So on assets and OpEx remuneration, it's basically an increase in the amortizations revenue that we have due to the investments, plus also an increase in OpEx revenue that did increase this year.

Other revenues increased a little bit more this year, mainly driven by corrections from previous years, okay? So these are typically cost that were not accepted for some reason or some assets that were not accepted. This year, that impact is around EUR 6 million. So it explains almost everything in this line was a little bit higher than normal, but it happens. So it's an unusual, I'd say, element, but it was slightly higher than normal.

Core OpEx, basically, it's a mix of -- and of the increase in personnel costs around EUR 2 million. And then basically, it's also other costs, mainly operational maintenance. I'll go through those. In terms of the [ weight ], you can see a slight increase in the international. So as you know, we are slightly ahead there in terms of the weight that it had [indiscernible]

Moving to Slide #10, basically, no news. We already knew the rates of return since October. So here, things are more or less stable. In Slide #11. So as I said, this is clearly showing acceleration mainly in electricity. We are growing transfers to around more than 10%. We are growing CapEx around 13%. Actually, if you look at electricity, CapEx is growing close to 16% despite, as Rodrigo mentioned, several approval headwinds. So it's still difficult to prove certain in CapEx, but we are still pushing through and accelerating the deployments, which will continue to happen in the next years as we'll comment a little bit after.

In terms of RAB returns, I'd say on Slide 12, it's very clear. So basically, in electricity, the positive impact comes from the asset base evolution. And in gas, there's a big decrease also from the asset base evolution, nothing out of the ordinary. The only thing is that here in this line in electricity, we don't see the impact of solar, but it also exists.

Slide 13 in OpEx, as I told you, the evolution is a little bit [ brief ], both to core external and to personnel costs. Personnel costs increased around 3%, 1.2% of that is increase in headcount, so just more people, and the rest is more the general increases that we are giving. So this increase in [ people ], let's say that in '26, you will see that happen, it will start to taper off eventually.

External costs. It's mostly O&M cost and this is derived from -- yes, a little bit of increase in price, but also the increase in the network as we are building more network. Bear in mind that these costs are then reflected in the regulation and recuperated versus the [ regulation ], although sometimes the increase occur before than the reflection in regulation, okay? There's also a little bit of increase in IT, but it's mostly electricity O&M.

Looking at Chile in Slide 14. So strong performance and the gas part, it's increasing a little bit, but it's basically stable, and we are coming also from record year. So let's say, stability is the key numbers here. Electricity is growing quite a bit. So EBITDA growing almost 34%. This is on the back of the acquisitions also that we did, but not only is the net income almost doubled or more than doubled, and this has to do with also an impact of exchange rate that was positive this year. In 2024, it was slightly negative. And so actually, it has a higher year-on-year impact. But then this is one of the reasons why financial results are also better.

But here in Chile. So we continue our focus of now integrating the small assets that we acquired in 2025 and continuing to pursue our organic growth agenda as we have defined. And so this is accounting almost for 5% now of our EBITDA.

[indiscernible] so in Slide 15, no major news in depreciation, as always, financial results. So it's a mix of several things. So as I said, it's -- first of all, an improvement in terms of the average cost of debt that came from 2.7% to 2.5%. But also, there is a large impact of exchange rates, a positive one this year. So it's slightly about EUR 4.5 million. But given the fact that last year was negative, so the year-on-year impact is almost EUR 6 million. So that's why it's also on a year-on-year basis impact a little bit more here. I'd say that's perhaps the explanation that you are missing from the numbers. Then we have also the impact from dividends that we received, but that's a more normal kind of event.

In terms of taxes, no major news. So what we see is that this year, we still paid the full levy amount versus last year we have a difference in the levy because in '24, we did have, in the account, some positive impact of court cases that we won. We already won more court cases during the year, but they are not completely final. And as usual, we'd rather be more conservative and not put it in the accounts. So we have not accounted for any court case winnings in 2025.

That doesn't mean that there was any change actually, we continue to win court cases in the gas part. In the electricity, there are no news but in the gas part, we continue to win court cases. But since they were not completely finalized, we didn't put anything in the account. But we are expecting that they will start to have in impact now in 2026 again, okay? So that's why in terms of levy, there is a difference in terms of the tax incentives for capitalization is now around EUR 34.5 million versus EUR 35.9 million in the previous year. We actually have guided you to around EUR 30 million. So this year is slightly above. We are not changing, I'd say, the overall estimate of around -- average of EUR 30 million because we think that in the following years, this is going to come down a little bit more. I'd say that on average, the number that we gave you of EUR 90 million should be more or less the same that we are going to get. It's not going to be higher. So I'd say that effective tax rate of 8%, very much in line with what we have in 2024, so positive tax rate also in 2025.

Slide 16. So it's just basically the different impacts, okay? So positives of EBITDA and financial results, depreciation coming down as it goes up in EBITDA, fairly slightly negative for the explanation that I told, okay?

In terms of net debt, Slide 17, we see very strong stability and without the tariff deviations, which are now stabilizing slightly below EUR 100 million. You have a small increase of net debt, but clearly slightly better than what we had expected and in line with expectations. Cost of debt improves as we only issued also the debt this year. So it's normal that in '26 and '27, it may go up a little bit because of the issuance of the bond. Debt bond issuance have other impacts. You see that at the end of the year, we have a maturity of 4.7. I can anticipate to you that these maturities, given the recent bond issuance, will go up. It's already up to 5.4. So we want to maintain at 5, so around 5, and so that is the aim.

You don't have it here in this slide, but we also have at the end of the year, slightly more variable than usual fixed rate. We were also waiting for the bond issuance and this is going to change, okay? And so we are going to have more fixed than variable. I'd say that it's going to set in the kind of normal range. So we'll have around 60% fixed perhaps by the end of the quarter. As the interest rate environment also is changing, so we are now becoming slightly more fixed again, which was what we were aiming at. We have this -- but more importantly, also, we have this positive development with S&P, we were upgraded, that shows that rating agencies are looking at the improvement in our credit metrics in a positive way, okay?

Slide 18 is just the share price evolution. So you all know that we have a good share price evolution. Share price has continued to perform well in the beginning of 2026. We have been now in the range of slightly above 3.7%. So we continue to improve in the stock market in line also with the sector or slightly above the sector, okay?

So just going over our sustainability agenda and metrics in Slide 20. We ended up the year stable or reducing slightly scoped 1 and 2 emissions. And this is in the face of, as Joao mentioned, an increase in use of gas given the blackout. So we were able to still improve a little bit, which makes that we are now at minus 57% versus 2019 with a now objective of minus 60% in 2030. So we are well on our way to perform this. The same in Scope 3, we are at minus 29% and with -- our objective is minus 30%. So we are basically there already and carbon neutral [ 2030 ] we are clearly on track. So I think that this shows that we continue to deliver. You have the details of this in Slide 21 but I'm not going to go in detail over this.

And in Slide 22, you see the main -- yes, the standard. So we don't work for this for the standards themselves, but it's good that they recognize the hard work that we do in this area and the commitment. So either we maintain because we are already at the top level or we are continuing to train the improvement in S&P Global.

So looking a little bit and doing a summarized version of what is the strategic update, so this is important because we have been delivering members that are better. Bear in mind that this is a subset of the slides that you have in the longer-form version of our presentations so not all of the slides are here. Of course, and specifically to the analysts, we are going to be meeting you face to face and you have and that information already in the site with some additional information to what I'm going to say so that I don't have to go through all of the slides. But the main messages are going to be the same, okay? But of course, when we meet you early next week and the following week, we'll be happy to go into all the details that we -- in this call is a little bit more difficult to give you.

So on Slide 29, and before going into the update -- I'm sorry, Slide 24. And before the giving you the update, it's important to register that we are delivering and outperforming versus what we gave you. So this is something that nowadays is important to refer because it's not always the case. We clearly came on target in EBITDA. We clearly came very much ahead in net profit. We clearly came on the low range of net debt. We clearly came above the interval and within the interval and ahead of schedule on the CapEx deployment. So this is important to give you that idea. Of course, only in -- we are only giving you some numbers for '26 and '27 not because we don't want to give more visibility that this is the normal timing. Next year, we are going to revise the full business plan. So we are not giving you now a new business plan once. What we are giving you is revision of numbers for these two years. And then next year, we will revise the business plan with all of these components.

But looking at Slide 25, what can we see in the numbers that we are giving you now? First of all, it is an acceleration of CapEx. So clearly, we are giving you and telling you that we are going to be deploying more CapEx already in '26 and '27, okay? And what we are saying is that this CapEx growth is coming basically from electricity. So there is an increase in the electric CapEx, there is actually a decrease in gas CapEx versus what we have in the business plan. This is extremely well aligned with what happened within our regulation. So we are -- this is what is happening now at the time were also regulation from electricity came out positive, as we have already mentioned before, in the end of the year. So it came off with a very healthy rate that allows us now to deploy CapEx with more confidence and to be able to accelerate knowing exactly the returns that we are going to have. So I think that there's this kind of multiplication effect of both things happened at the same time, more CapEx and improved regulation.

Then what I can tell you is that on the fiscal and funding, we are consolidating what we have before. So fiscally, there is a major upgrade in terms of the taxes that is what we have been seeing from the past years with the [indiscernible] gas now going away with the corporate tax rate improving. So there's a lot of small things that are improving tax and continuing to improve and sustain tax. And unlike other companies, we are actually improving credit metrics that the best sign is the upgrade from S&P. So it's a little bit unique versus other TSOs. We are actually improving. The credit metrics, which also allows us to build flexibility into the metrics so that if there is and we hope there is more upside in CapEx coming from in the future. We are going to be able to capture that opportunity as it unfolds.

In Slide 26, you have a little bit more detail on what the CapEx step up is. So as you can see, it is basically a step-up in electricity, okay? So we are increasing in a material way the electricity CapEx range that we have versus the initial targets, right? So it's more than 50% of increase versus the targets. We are decreasing the ones in gas and basically because H2 development is growing at a slower pace, is not something that's consensus. We are deploying it in a conservative way. We are waiting for this to become a higher priority in certain agenda. So we are deploying it as it shows.

But again, let me focus on the electricity CapEx. These strong increases across the board it's mainly linked to integrating more renewable capacity. It's the power supply to these new high demanding zones and the fact that most of these is going to be an [ asset ] in 2027. It's more modernization of assets. So it's more connecting to distribution network. So it's a whole range of things and that is pushing CapEx to grow a little bit more.

To comment specifically on solar agreements, they are, as I had already mentioned, slightly delayed in the deployment, but we are expecting that between this year but mainly 2027 we are going to be catching up with the timeline that we have. In Chile, no major news. I'd say that the major change was that we acquired those assets last year so there is little bit less of organic CapEx that we deploy.

Slide 27, most of this is already -- you already know. So there was a good improvement in electricity regulation and base rate is close to 6.2% with a premium on [ all that ] and we [indiscernible] conservative view on incentives. We should be at or slightly above 7% of return. That is a positive, and we were -- development and constructive development in terms of regulation. So we are much more comfortable with deploying CapEx now in electricity and I think that this is going to have a positive impact as we already know in EBITDA.

So summarizing in Slide 28. So what we are seeing and giving you an updated target. In EBITDA, we are giving you -- and this is only for '26 and '27, a range of EUR 540 million to EUR 560 million. Bear in mind that before the maximum number in the interval was EUR 540 million, and this is now the minimum interval, so around an increase of 12%. So we think this is consolidating what we already were giving analysts as guidance.

In net profit, clearly a very large upgrade. So we are putting around EUR 150 million to EUR 160 million. This year, we were at EUR 150 million. We tend to be always a little bit more conservative in the intervals that we give you, but this is a number that we feel now comfortable for the year. Although as I said, we are already at EUR 160 million in 2025. That's slightly more. We are spending a little bit more CapEx, it's normal that it increases. But the relevant part is that the metrics behind this are improving, okay? So it's not so much that the CapEx is improving or that the net debt is growing a little bit. The credit metrics are -- despite this increase, actually improving a little bit, which as I told you is shown by that rate that we recently have.

In CapEx, we have this interval of EUR 350 million to EUR 450 million. We're increasing it to EUR 450 million to EUR 550 million. So we are increasing everything at EUR 100 million. So we'll see. Again, we like to be conservative. My colleague, Joao has a lot of work in this past few months just redoing what was the impact of the storms in Portugal. So it's a challenging year for his team on the construction side that they have not only to do a lot of new CapEx, but now they have to spend a lot of time redoing CapEx that was [indiscernible]. So we are always, I'd say, conservative in the way that we approach these numbers as we like to be. But we are confident that CapEx is going to accelerate already in the next 3 years.

So concluding on Slide 29, accelerating growth. We are seeing these asset-based growth in electricity of around 9% with regulated and nonregulated assets and solar agreements. We saw this improvement in regulation. We've expected above 7% returns. We continue to see this favorable development in the fiscal part and we are not accounting for, in these numbers, this EUR 40 million a year is even being slightly conservative on the incentive that we have now at EUR 34 million. We are not considering in these numbers any recuperation of levy that we may have in the year. So again, it's a very positive number with upside on top and in funding, as I said, unique and has a position of improving credit metrics, although we are growing and accelerating.

So finally, Slide 21, a very good set of results in 2025. I think that guidance shows you that we are committed, and we are seeing acceleration of growth. And as I said, although we are only giving you this for '26 and '27, this is something that we see continuing for the next year. But this was -- we are only giving this for the next two years.

And also, since this is not a new business plan, we did not update everything. One of the things that we did not update as of now, we will update next year is the dividend policy. So we prefer also to maintain the current dividend policy. We have already anticipated growth one year. So we maintain the 2%, and we are proposing -- or the board is proposing to the AGM a dividend of EUR 0.16 per share. Price has been performing very well and rewarding shareholders. So I think that this is clearly keeping in line with what we have promised the market is 2%.

So thank you very much for your attention. This was a little bit longer than usual, but let's open up to questions that you may have. Thank you.

[Operator Instructions] And now we're going to take our first question, and it comes line of Ignacio Domenech from JB Capital.

The first question is on the lower financial costs and the higher financial income in the quarter, I believe Goncalo you mentioned one-off of EUR 6 million but actually looking at the quarter, we're seeing a decline both in the financial cost, but also an increase. So I just want to understand what drove this one-off, which is quite material and to understand if it was a cash impact, okay, if everything was cash.

And then secondly, on your CapEx plans, we saw a material increase versus the [ 2024, '27 ] targets, which you outlined in the business plan. So just wanted to understand here as well what is the -- if this is the right level of investments that we should expect going forward or post '27, we should expect this number to decrease as I assume that part of the CapEx includes the solar direct agreements, okay? Just to see if there is any upside risk there. Thank you.

So on the financial costs, the main change in the quarter is the thing that I mentioned, exchange rates because in the last quarter, it changed a lot in Chile, okay? So you have actually negative exchange rates until then on the third quarter and then they became positive, okay? Because of the elections and on the follow-up of the elections, there was a very strong reversal that became very positive. So that's why you see that change, which is a little bit again, more abrupt than usual. So usually, you would not see any change in this manner, but it's basically that, okay? So that's basically -- [indiscernible] can then give you the details, but it's basically from being negative almost EUR 4 million to being positive almost EUR 4 million.

On the CapEx plan. So as I said, we were not giving you anything after '27. But yes, we are not expecting a decline. So we are expecting things to go up and to stay at a higher level, depending on any given year. So it's not going to be every year, it may be higher or lower. In '26 and '27, mainly there's a lot of CapEx to be done still in the first part of the first solar agreement and the second solar agreement will kick more in '28, so in a few years. But so there is a lot of CapEx. If you go and check [indiscernible] and plans that are given, you can see that there is a lot of CapEx. That CapEx is reflected -- part of it is reflected in the regulation already of the -- that is the OpEx model. So it's already there. So yes, we are expecting that it goes up and it stays higher, mainly in electricity, but it can vary on any given year, okay?

A follow-up question, if I may, on the recurring net profit of EUR 150 million, EUR 160 million. I assume this includes the tax capitalization incentives, right? But it does exclude any upside from tax recoveries from CESE. Is this correct?

It's correct. So we are assuming capitalization there. As I said, we are assuming actually an average that is below EUR 30 million for '26 and '27 and actually in '25 as well, was higher than EUR 30 million, so it's around EUR 28 million, EUR 27.5 million that we are assuming for those years. But it's just because we like to be conservative. We don't have the visibility. We have an expectation that it may come down a little bit. But again, we like to be conservative.

On the levy, we are not assuming any change, we are assuming the same thing on 2026 minus the EUR 10 million of gas. And in '27, basically, you are already assuming a small decrease in the electricity levy because according to the budget, the new assets, the ones that you deployed in '26 are already not [ such to it ]. But you only see that reflected in '27 because these assets are being amortized. The old ones are being amortized and you pay less levy and the new ones you are not paying levy. So you'll see the levy come down, I don't know, EUR 1 million, EUR 1.5 million, EUR 2 million per year, okay? So that's what we are assuming, a very small decrease on the levy on the average for the 3 years, okay? But on a yearly basis, you could see it decreased EUR 1.5 million, EUR 2 million, okay? That's only on '27.

And the next question comes from the line of Jorge Alonso from Bernstein.

Just a clarification in one of your slides on -- regarding on the CapEx. I know that you're not going to give us any figure for '28, '29. But just to understand, the national transmission network plan that you put the EUR 801 billion between 2026, 2029, and then special CapEx for the [indiscernible] region to be deployed by [ '31 ]. Just to understand how overlap is that? So just to understand if basically the [indiscernible] CapEx are expected to be deployed already since 2026? Or it will be more back-end loaded starting maybe 2028 to 2031. That's the first question, just to how to allocate that extra CapEx.

The next -- the other questions are regarding the tax breaks. If you can provide any color about it. Do you think that this can be extended one year more? If not, if any, when should we have news about that? And if you had any view about the potential complete removal of the special energy tax on electricity in the near future? If you think that the mood in the political landscape has changed, and this is now more likely than in the past.

In relating to [indiscernible] Joao can complement, but yes, it's clearly after '27. So before '27 and in the CapEx that we have for these two years, we have not even 10% of that investment. So I think that Joao is starting to going to be doing that in '27 but very small amount [indiscernible] So it's more '28, '29, '30, okay? And the government also is coming out now with a new process for basically new high-demand areas. These are basically linked, as we have said in the past, to data centers and things like this. We -- this is a process that is ongoing. We cannot give you any news now. So it can result in additional CapEx that we won't have in the network. But again, if it does and this is clarified along this year, it's only going to be deployed in '29, '30 and so it's not in the horizon for these 3 years. Next year, so when we can with the business plan for '27, '28, '29 and '30, we are going to give you -- and perhaps that is going to include most of this CapEx that we are talking about. But in these numbers, we have basically almost nothing, okay? so it's an upside that is longer term.

On the tax part, on the tax incentive, we don't know. So it may be that it is extended. We don't know. We only know is it was created by the previous government, it was maintained by this one for already more than two years. So it is something that appears to have some kind of consensus that it is an interesting tax incentive for [indiscernible] that's the only thing I can give you. I am not revising any expectations relating to that. But again, another upside, it may happen. It's an upside, we like to be conservative on this.

On the sales, there's no news, it's what I told you. And on the electricity side, we are seeing there is nothing new on the court side, there's no new news relative to any of the court cases that we have on the electricity are moving, okay? But there is -- there has been a change in the mood of the court, so we will see. The reality is that the budget itself already limited. So no new CapEx is going to have the levy. So even if they didn't change it once and for all, it's already going to be declining starting in '27. Again, I think that there is an upside here that you may read into it in a few years, this may change, but we don't know. So I think this is following the trend of the gas. I think that they are now consolidating that gas has changed. And then I think there's the court case. There is a point where the courts will have to also say that this is -- this doesn't make sense, but we are waiting and hoping that these changes, okay? But there is no specific new news to be to give you on this one.

Dear speakers, there are no further questions for today. And I now would like to hand the conference over to the management team for any closing remarks.

So thank you very much for attending. As mentioned by Goncalo, we are still going to be able to take any of your questions offline. And we'll be discussing these numbers over the coming weeks. So thank you again, and speak to you soon. Thank you.

Hello, good morning, ladies and gentlemen, and welcome to REN's Third Quarter 2025 Results Conference Call. We appreciate your presence here today. Joining us this morning, we have the members of REN's Executive Committee, Rodrigo Costa, our CEO; Gonçalo João Soares, our CFO; and João Conceição, our COO. Rodrigo will begin with his opening remarks, and this will be followed by a detailed overview on REN's operational and financial performance for the third quarter.

Following the presentation, we will open the floor to your questions. Thank you again for your attention and continued interest on REN.

Thank you, Madalena. Good morning, all. As you were able to read our results for the quarter didn't bring surprises, and we are very, very busy in all fronts on infrastructure construction, on new developments on the licensing phase, and more to come as new industrial and data center projects are surfacing the news. We'll see what happen, but we -- for the moment, we are already super busy preparing those plans.

We keep working closely with the government to facilitate the planning of all these projects. The [indiscernible] report was published and came out as expected and basically confirmed that we did our job, and we all need to learn from the experience. More reports will follow in the beginning of the next year, and I'm sure they will help our industry.

Our regulator shared their comments on the natural gas investment plans. They are public and more recently on the electricity transmission and distribution regulation with final terms to be published in December. Our Chilean projects are progressing well. We just announced a small acquisition of transmission assets that will increase our critical mass in the operation of [indiscernible].

On the special tax front, sales for natural gas will be over soon, and the same applies for the electricity new projects, both very good news. And this is it.

And now Gonçalo will take us through the details.

Thank you, Rodrigo. Good morning to you all. So as was said, I'd say that overall, the main thing is that the third quarter was basically in line with our expectations. The second thing I'd say is that the draft regulation that came seems to be a constructive step in terms of evolution. So -- and third, we think that the news that came from the draft budget on the tax front were also positive. Generically, the main financial numbers at almost EUR 384 million.

The EBITDA, small decrease. So that this decrease will be more stable towards the full year kind of results. Net income of close to EUR 104 million, a strong increase. But this is, as I said, in the previous quarter, impacted by the way we are accounting for the tax incentive. Net debt coming down still. So I'd say stability, and we are clearly building flexibility to accommodate further growth in the coming years. And CapEx is picking up, although there are some delays, and I'll go into that, it's clearly picking up and accelerating a little.

But as of -- for now, I'll pass it to João who will make you a quick update also on the operating side.

Thanks, Gonçalo. Good morning to you all. From the operational side, I would highlight the fact that the renewables share kept approximately the same value year-on-year. We are about 70% of our electricity consumption supplied from renewable sources. The difference, I would say, is the fact that after the blackout, the consumption on natural gas increases, and it offsets the share of imports of electricity from Spain.

In terms of electricity consumption over the past 9 months, we reached the highest level in the last 15 years with an increase of 2.6% year-on-year. And the natural gas consumption is a reflection of what I've just said as a consequence of a higher usage of combined cycle plants to generate electricity from natural gas side. From the other points of the operational perspective, Gonçalo has already mentioned, the most important one is the proposal of the new regulation, which we will speak a little bit further on.

Moving to Slide #7, you have the figures. Part of it I've just mentioned. I would complement only with the fact that we kept the high levels of quality of service, clearly above the target set by the regulator and which are used to calculate the efficiency incentives that we have in today.

And with this, Gonçalo, I move back to you.

Okay. Thank you, João. So Slide #8 is just the main numbers. I think I've already spoken about them. So if you move to Slide #9, I'm sorry, on EBITDA, we see this small decrease on the quarter. And there is, let's say, still a conservative estimate that we are doing on our current incentives for the year. And so that kind of depresses a little bit the numbers. We think that full year, this will probably be recuperated. And there's some -- on other revenues, there's a disappearance of rent trading and its incentive.

On OpEx, we'll go into that, but it's mostly personnel and O&M. But I'd say that for full year, we should expect a more stable kind of EBIT on a year-on-year kind of logic. In terms of contributions, there's a lot of stability on the electricity side, and you start to see an increase on the Chilean contribution, although as always on still being a small part of REN as a whole.

In terms of Slide 10 and looking at ROI, there is no news. I'll just make a couple of comments now about the new draft regulation, and I'll leave it then to [indiscernible] on the Q&A to complement this a little bit. So what we saw was, first of all, a stable framework, which is good news. So no -- apparently no major changes. Second, we saw a 90 bps increase on the base ROR, which seems to indicate that the blended rate without any OpEx gains to be around 7% with the premiums and the incentives that we have to be around 7%.

We also see a recognition from the regulators that we have been very efficient in OpEx as they reduce the OpEx efficiency factor. So overall, we feel that there are still certain things that we should improve. The team -- [indiscernible] team regulation is engaging with the regulator, but we do feel that this is a constructive proposal. And let's wait for the 15th of December to have a final. So on the Q&A, we'll be able to clarify a little bit more, but this is more or less what we know as of now.

Looking at 11 on investments, we see that there is an acceleration of investment versus last year clearly. That being said, and to be completely honest, it's a little bit less than we had expected. So we are still trying to catch up. So some of the CapEx that we had expected to do this year will probably be done next year and probably on the 2 years average, we will be within expectations, but there was a small delay. Most of them were not on our side, were on the solar agreement side. But that being said, I think you'll still see an acceleration and an increase as we've said all along.

In terms of RAB returns, nothing new. So you see electricity improving. And as you know, you should add solar to these returns, but you see electricity improvement, gas distribution more or less stable and gas transportation coming down.

Looking at OpEx, as I said, there is an increase at this stage. This is the same trend that you saw in the first and second quarter. So it's mostly personnel costs, although on a full year, they will probably grow a little bit less than they are growing now. There are some external costs, namely O&M and some IT that is increasing. O&M is increasing because basically, there are some price increases, but we have more kilometers offline. So we have more to operate. So it's normal that this is increasing and then this is reflected as time goes by in the regulatory excepted OpEx.

Looking at Chile, things are progressing as expected this year. You saw and you know that we bought a couple of assets this year. So this is accelerating a little bit the evolution of EBITDA for 2025. It's now increasing a little bit below 30%. Full year, it will probably be a little bit better, which will continue for next year as we consolidate the full year accounts of the assets.

Electrogas is basically stable, a small decrease, small changes in gas volumes, but it's mostly, I'd say, a small decrease, but stable overall. And so I'd say that Chile continues to perform well within and that expectation of being a small part of REN as a whole.

Below EBIT on Slide 15, depreciation, no major news as usual. Financial results. So what we are seeing is clearly a lower debt, which will be the trend for the full year also that impacts financial costs. And we also are seeing a small decrease on the average cost of debt. So this is where probably full year, it will mostly likely stay closer between 2.5% and 2.6%, around that. We will probably not issue this year as we will be waiting for the final regulation to come out in December and the final state budget to come out in December also. So we'll probably issue beginning of next year in the first quarter. And that's when I'd say then the cost of -- average cost of debt will again increase very slightly. But I would say that it is very stable at these levels that we are seeing now.

On the tax side, we continue to account for the capitalization incentive. That is the main driver for the increase of net income on the third quarter. Of course, on a full year basis, this is going to be different because we accounted last year on the fourth quarter. We'll probably have a smaller amount because last year, it was around EUR 36 million as you may remember, we've indicated around EUR 30 million for the years that will come. And so this will probably on a year-on-year be slightly different.

But looking forward, we have good news, as you saw in the [indiscernible] state budget, they are eliminating the levy for the gas assets. That's EUR 10 million more of net income that will probably come next year. They are continuing to reduce the corporate tax rate. They are eliminating the levy also on the new investments that we do in electricity. So it seems to be good news. This is -- as we've been fighting it a very unfair tax for a long time, and it seems that finally it is correcting itself in the next year's budget.

So looking at net profit on Slide 16, you see just what I said. So most of the impact comes from not only a decrease in net debt, but also an improvement in the income tax, which is because of that accounting issue, and this will be smoother. So do not expect a 20% increase in net income for full year. That is not what consensus is, it's not what our expectations are.

Looking at net debt. So this is a reduction for this year. We continue the same trends as we saw in the first half of the year. So this is what we should expect for year-end. So a decrease of net debt amount. As I said, we are now reaching the top of the interval that we have said in terms of FFO/net debt, we are clearly managing the balance sheet carefully to enable us to have flexibility for additional growth in the coming years, but being careful at the same time.

Maturity is a little bit below 5 years because of us delaying the issuance of the bonds, but we are around 5 years, and this will again be above 5 years as we issued the bond for next year, okay? In terms of shareholder price, it has been a good evolution. Prices are above these numbers that you see here already because they've picked up again in October on the back of those news that we've told you. So it seems that shareholder returns will be pretty decent for the full year of 2025.

Looking at ESG, and I'll go through this very quickly. It's more for your reference on Slide 20. You see that the most interesting point is the point that emissions are increasing or the most relevant point, I should say. This is basically due to, as João explained also, a larger use of gas generation facilities due to the blackout that occurred and that then cost for emissions to grow in the grid. And so that's why we have more emissions ourselves, but I'd say that it was a very specific and isolated incident, okay? So that's the main event, I'd say, and the main thing that we see here in ESG. As you read the initiatives, we continue to go and to address this in a very detailed manner.

As you see in Slide 22, in terms of ratings, they are either stable or improving. So this is an area that we continue to address and to give a lot of attention. So as a closing remarks, I'd say so good results, good stable results in terms of net income with signs of investment acceleration, okay? And the second is a good new budget and constructive regulation in the outcome this year. Third, just to tell you, so we'll have still, as usual, a Board in the end of November. This is the usual Board that approves that intermediate dividend that we paid, the anticipated dividend that you should expect as normal to be paid in December as we have done in the past years, okay?

And with this, I conclude and I'll open the floor to any questions that you may have for us. Thank you.

[Operator Instructions] We will now take the first question from the line of Enrico Bartoli from Mediobanca.

The first one is on the new proposed regulation. You mentioned an expected return combined around 7%. The base one is 6.1%, if I add also the incentives to the pre-2002 asset, we get to 6.4%. So if you can elaborate on how you get to that level, I guess, adding incentives? Also in the document published by [indiscernible], there is a mention of the possible upside of this return to 7.9%. So if you can elaborate a bit on what could lead to that level and what reasonably could be achieved by REN in order to increase the blended return? In this context, if it's possible to have, let's say, a flavor on, let's say, the possible impact that the new regulation, if confirmed, could have on your CapEx plan in [indiscernible] transmission, if you think that there could be the proper condition in accelerating the investments that you have in the current business plan?

And second question is on the level of debt that you indicated for the year-end. You anticipated that this is going to decline. If you can also, in this case, elaborate a bit on the moving parts because actually CapEx is going up, then you have the acquisition of the additional assets in Chile. If you can also indicate how you expect the evolution in the fourth quarter of the tariff adjustments?

And the last one is on the outlook for investments in gas. It seems that, let's say, in general, in Europe, there is some, let's say, delay in the implementation of the production of hydrogen, around 50% of your investments in gas in the current business plan are related to green gases. I was wondering if you see some, let's say, risk or some, let's say, delay in those investments considering the current market situation.

Lot of questions, but let's go. So regulation, so you are asking -- actually, most of those calculations were made by the regulator himself, okay? So we don't know a lot of the details, but the 7% that I was talking is clearly those 2 things is one is those 3 old 75 basis points incentive that have some of the assets, the premium. Second is unexpected value for incentives. The regulator in their calculations have put 68 or 64 basis points of expectation. It's their own calculation. And I do not think this is the full amount. So that's more or less where -- what you get is if you calculate that premium on average on the blended and you put around what they estimate, you get around this figure a little bit above or a little bit below, okay?

So if we are able to beat their expectations, we'll actually be higher than 7%. If we miss a little, we will keep -- but this is around the 7%, okay? So that's the calculation. The [ EUR 789 million ], we don't know. I think that their calculation has to do with some expectation of efficiency gains, but we don't know. I would say that this is around 7% is what is easier to compare with other companies. And each company has their own OpEx efficiency gains, and that's a little bit different, okay?

Just to comment on the debt so that I leave the CapEx for rest and João can comment a little bit on those. I mean, we are expecting it to be around EUR 2.5 billion. So that is, I would say, stable to a small decrease versus last year, okay? Of course, CapEx is a little bit stronger at the end, but -- so I'd say that's more or less what our expectations are. So in relation to CapEx, just to tell you before I pass it to João, yes, I think that there is room to accelerate on the electricity side. We actually have a couple of delays this year. So this is what we are expecting.

João, can you comment on CapEx on both electricity and gas?

Right. Starting from electricity, this is a trend that we're already following. So we have different fronts on our CapEx plan, not only to create new connections for injection, so for new solar and other sources of renewables that are foreseen in the Portuguese energy policy, but also on the demand side because as you know, it's public. We have a long queue of requests for new connections, mainly industrial consumption, data centers, green steel, ammonia, batteries -- now for the moment, a little bit spread all over the country, not only in the Sines area, but also closer to Lisbon and Stovall and several other areas of the country.

So I would say that we are not changing the CapEx -- electricity CapEx perspective. Obviously, like Gonçalo said, constructive regulation is positive for that. In what concerns to gas, it's true what you're saying. Hydrogen acceleration is decreasing a little bit. But bear in mind that our plan was always very cautious on what hydrogen is concerned. Our investment in CapEx -- in gas as I would say, 3 pillars.

The first one is maintenance and replacement CapEx that is always needed because several equipment reached the end of their life cycle and needs to be replaced and needs to be upgraded. Then you have a second bulk, which has to do with biomethane. And we are receiving several requests from potential generators of biomethane to connect to the grid and to inject in the grid their biomethane. So this is some importance within the gas plant.

And last but not least, hydrogen. But even hydrogen, our approach was only based in the beginning with the blended of natural gas and hydrogen. And much of what we are foreseeing for the very short term, and I would say the very short term, the time horizon that we need final investment decisions. This has to do with the blending and not new infrastructure purely for transmission of 100% hydrogen.

We will now take the next question from the line of Ignacio Doménech from JB Capital.

I have 2 questions and a follow-up. The follow-up is on the CapEx side, given the acceleration we are seeing in this quarter and potentially in the coming quarters. What would be your best estimate on regulated CapEx for electricity? I don't know if for the period that Rodrigo has said or any period that you can give us, okay, to have a higher visibility there?

And then on my 2 questions, one is on returns, okay? If in your view, it's fair to assume that given that in the past, returns -- the regulated returns on gas have been higher than electricity for many different reasons. If it's fair to assume that at least returns in the next regulatory period would be at the levels that we've seen in this graph for electricity. Okay.

And the second question is regarding the business plan that you presented in 2024. It does seem that most of the objectives have been surpassed. So -- and apologies if you mentioned something in the call, I was having some logistic issues. But if you can give us some color on what are you planning to update the these objectives? How are you thinking on the framework for the next business plan?

Thank you, Ignacio. So I mean, regarding the first one, we are not going to give you it's a quarter away. So the only thing I can tell you is that this year was, in particular in the execution of our agreements a little bit slower than we expected. So we're expecting to have a slightly higher growth this year than we will probably have. That being said, you'll still see a growth in CapEx -- but I think that is going only to materialize next year, okay, in 2026, a higher growth. I'm not going to tell you the numbers of our budget, but this is the discussions that we are having internally, and they are showing that in our internal numbers. I can only signal you the direction and the sense.

Regarding the update that you were referring. So this is something that we've commented with some of the analysts that beginning of the year, probably at the same time with the full year end results of 2025, we may do, let's say, an update of key figures for '26 and '27 as some of the numbers are a little bit outside of the range in the business plan, we may revise this. So this is something that we are working internally. We are waiting for the final regulation and budget to come out. We will discuss this internally, and we'll come to the market. But this will probably not be before we disclose the full year results for '25, okay?

[Operator Instructions] Our next question comes from the line of Guilherme [indiscernible] Neves from Invest GA.

I would like to know what are your perspective long term regarding the availability of interconnections with Spain, given the possible spike in electricity demand with the Sines data center project? Do you plan or consider developing incremental network capacity to bring electricity from Spain?

Thanks for your question. As you may be aware, when we are speaking about an interconnection, the 2 parts need to be in agreement. So it's a long process that we have to interact with the Spanish site. We are working at the moment to conclude the new interconnection in the north of the country, [indiscernible]. We are expecting to be completed by the end of this year, beginning of -- early months of 2026. And then we have to continue to do our network planning arrangements with our Spanish counterparts to see the new developments for the future.

Thank you. We will now take the next question from the line of Flora Trindade from CaixaBank.

I have 2 quick ones. The first one is a question on regulation. So in the previous regulatory framework, there was a review from the draft to the final return. Do you expect this time to see an improvement again?

And then the second question is on your dividend policy. Could you assume that it could make sense to propose a higher dividend considering the strong results you are getting this year and the expectation that you will have, again, recapitalization incentives next year?

Well, just on the regulation question, we will -- we are waiting now for the final decisions of the regulator. And we don't comment on what's going to happen or not. It's now the decision, it's a process. They are getting comments from other parts, and then they will do their decisions and publish by December. Regarding the dividend, same, we never make any comments on -- we have -- today, we have a clear policy, and that's the one that we have, and we will not comment on decisions that will have to be taken, proposal by the Board approved on the registered shareholders' meeting, then that's all we can say.

We will now take the next question from the line of Fernando Lafuente from Alantra.

I'm asking two, please. The first one is on taxes. What are your views ahead of first, on all those taxes that you have paid already -- special taxes, I mean, or the extraordinary taxes that you have paid already and that you will -- you are suing in courts? And secondly, going forward, what are your expectations of tax -- special taxes, both in the positive side -- on this positive taxes and also in the special one for electricity and gas?

And the second one, it's on potential M&A. I believe by your comments that you have plenty of CapEx to be done in Portugal. Hence, my question is if your, let's say, is position or mood ahead of new M&As, probably not big in Chile, if you are considering doing something or if you are well with your current exposure to the country?

Thank you. So relative to taxes paid, as you know, we have been winning in court the levy cases regarding gas assets. So we won some in 2024, and we've also won 2 this year. So we are continuing to see this. There is an amount around EUR 50 million to EUR 60 million paid taxes that we have not put into the accounts as recuperated from that time onwards. So if you account for 2021, '22, '23, '24 and '25, which we pay this year, it's around EUR 10 million a year. So we -- it does seem, but we don't want to make a lot of comments. It does seem that we have a good likelihood of winning those, but we will see have this continue to progress in court. But -- so this is, I'd say, an upside with a good probability for the coming years, okay? So we will see if this year, there's already something in the accounts. But there is clearly a good upside, as I said, good progress.

Looking forward, as we said before regarding the levy, so what we are seeing now is that, one, the gas is gone. That's the good news. Two, on the electricity side, the new assets will not pay sales. That is also very good. So what you'll see is the levy come down progressively as time goes by, okay? We will see if and we still consider that this will have to end someday, but we don't know exactly when it is. Regarding the incentive, which is the other positive, as we said, we have a very strong expectation based on legal opinions that we have for '25, '26 and '27.

'25 is already going. It was in the budget. '26, it's still in the budget and is being proposed by the government. So there seems to be a certain maintenance and a certain field on the tax authorities, but this is an incentive to be maintained. Even if it was not in the budget, as we told you, we felt that we would be entitled to it. So -- but it is better that it is in the [indiscernible].

Regarding M&A, we don't have any idea. So these small things that we did in Chile, we almost don't even consider it M&A, acquisition of very small assets. It's almost a greenfield more than M&A because it's very small. We don't have any plans to do any M&A or any acquisition, okay?

There are no further questions at this time. I would like to turn the conference back to Madalena Garrido for any closing remarks.

So thank you, everyone, on the line, and we remain available to take any additional questions that you may have. Thank you, and have a good day.

Thank you very much.