Naturgy Energy Group - Experts & Thought Leaders

The Naturgy Shareholders’ General Meeting approved all items submitted to vote on the agenda with widespread support. These include the company's launching of a voluntary and partial takeover bid to buy back its own shares. This is intended to raise the free float level on the stock exchange. The operation will be carried out at a price of €26.5 per share and is limited to 10% of the capital. The takeover bid has the backing of Naturgy’s five key shareholders (Criteria, GIP, CVC, IFM and Sonatrach). Second phase In a second phase, Naturgy will return these shares to the market flexibly  In a second phase, Naturgy will return these shares to the market flexibly and at its discretion. Overall, more than 99% of the shareholders represented at the Meeting have supported the operation proposed by Naturgy with their vote. The Meeting also approved the payment of a complementary dividend of €0.6 per share on 9 April against 2024 profit. This amount, together with the interim dividend paid during the rest of the year, totals a dividend of €1.6 per share, which represents an increase in shareholder remuneration of 14% over the previous year. An improvement that places the dividend yield offered by Naturgy as one of the most attractive in the sector. Number of board members In addition, the Meeting approved a change in the number of board members to 16, In addition, the Meeting approved a change in the number of board members to 16, in compliance with the legal right to proportional representation of its shareholders. The change involves adding one proprietary director for each of its major shareholders, maintains the number of independent directors and progresses towards achieving parity objectives. Changes to the board include the renewal of board members whose terms of office have expired: Isabel Estapé, for CriteriaCaixa; Raj Rao and Lucy Chadwick, for GIP/BlackRock; Javier de Jaime, for Rioja/CVC; and Helena Herrero, as an independent director. The Meeting has also approved the appointment as new directors: María Isabel Gabarró for CriteriaCaixa; Martin Catchpole for GIP/BlackRock; Marta Martínez for Rioja/CVC; and Nicolás Villén for IFM. Widespread support Naturgy’s shareholders have also widely approved Group’s annual accounts in 2024 and management by the Board of Directors in a context marked by a particularly volatile energy scenario. Naturgy Chairman & CEO, Francisco Reynés, focused his speech to shareholders on three pillars: results for the 2024 financial year, a review of the company transformation initiated in 2018, and the new 2025 strategic plan. With regard to the results, he highlighted: “maintaining a historical level of performance in a less favorable, more volatile and challenging environment”. Operational efficiency On the transformation initiated in 2018, he emphasized “improvements in operational efficiency and reducing volatility, investment discipline, improved customer service and employee motivation, progress on all ESG aspects, and especially on energy transition”. Regarding the 2025 strategic plan, he explained Naturgy’s industrial model, the main principles for plan execution and investment and shareholder remuneration commitments. The Meeting had a very high attendance quorum, close to 92%. All proposals submitted for approval have received more than 98% support. Historic results The company posted a net profit of €1.9 billion, while the group’s Ebitda stood at €5.37 billion In 2024, Naturgy managed to maintain the historical level of results achieved in 2023. The company posted a net profit of €1.9 billion, while the group’s Ebitda stood at €5.37 billion. These results illustrate the group’s ability to continue to create value in a much more demanding energy context, with an average 30% drop in energy prices. Since Naturgy began its transformation process in 2018, the company has generated a total shareholder return of more than 9% per annum compared to the Ibex average of around 5%. At year-end 2024, ROIC (return on invested capital) was 11.1%, improving from 6.5% in 2018, while ROE (return on equity) for 2024 was 16.1%, up from 7.6% in 2018. Shareholder value Naturgy presented a new and ambitious Strategic Plan with which it intends to continue creating value  The creation of shareholder value was accompanied by a significant contribution to society by the company. In terms of fiscal contribution, taxes and levies, €1.53 billion were recorded in 2024 alone, higher than the €1,35 billion paid out in the same year in dividends. In February, Naturgy presented a new and ambitious Strategic Plan with which it intends to continue creating value for all its stakeholders in the 2025-2027 period. Despite facing a period of high volatility in energy prices, the group expects an average annual Ebitda of €5.3 billion and an average annual net profit of around €1.9 billion, thus maintaining a record level of results achieved in a different and more favorable environment. Organic investments Compared to the previous three-year period, the company expects to increase its organic investments by around 10%, totaling €6.4 billion, not including potential inorganic growth opportunities. Of these investments, 50% are earmarked for the Networks business and 30% for the development of renewable projects (power generation and biomethane production). Spain will account for 75% of investments, compared to 55% in the previous period.

Naturgy has commissioned the Ocaña photovoltaic in the province of Toledo. The 50 MW facility will produce around 100 GWh of renewable energy per year, equivalent to the annual electricity consumption of approximately 26,000 homes. By connecting this new plant, Naturgy reaches 1,200 MW of operational renewable generation in Castilla-La Mancha and reinforces its commitment to promoting its energy transition. An investment of 31 million euros was required to commission the Ocaña plant, and it has generated around 300 direct and indirect jobs during the construction phase. Photovoltaic panels The new plant consists of more than 93,000 photovoltaic panels and will have a lifetime of 30 years The new plant consists of more than 93,000 photovoltaic panels and will have a lifetime of 30 years. Its production will prevent the emission of 42,400 tons of CO2 per year, equivalent to taking 17,500 vehicles off the road. The Ocaña photovoltaic plant will also contribute to improving the electricity distribution network with a series of additional reinforcement measures, such as increasing the Valdemoro electricity substation transformation capacity, as well as creating a new evacuation line that will benefit not only this town and its region, but also the entire distribution network in the area. Environmental and landscape integration Located on a disused former mining site, the facility has been designed with environmental and landscape integration in mind. Proof of this is the wide range of preventive, corrective, and compensation environmental measures that are being implemented. For example, agronomic tools are being implemented (crop rotation plan, limitation of the tillage calendar, and minimization of agrochemicals) on 25 hectares of dry farming land to encourage sustainable agriculture, using good agricultural practices such as maintaining traditional fallow lands that favor the recovery of habitats more suited to the needs of the steppe birds in the area. Nesting boxes for birds and bats will also be installed to encourage these species to nest around the plant, and measures will be implemented to protect pollinators and other insects, leaving areas inside the facility where no vegetation removal treatments will be applied. Castilla-La Mancha With this new solar facility, Naturgy reinforces its commitment to Castilla-La Mancha With this new solar facility, Naturgy reinforces its commitment to Castilla-La Mancha. It is finalizing the construction of two more solar plants in the province of Guadalajara, Zorita I and Zorita II, located in the surroundings of the former ‘José Cabrera’ Nuclear Power Plant, between the municipalities of Almonacid de Zorita and Zorita de los Canes.  When connected to the grid, both facilities will together provide an additional 100 MW of power. Wind and hydro power The company currently operates more than 1,200 MW of wind, photovoltaic, and hydro power through 30 facilities in different provinces of the region. By technology, the group manages 12 wind farms: Loma Gorda, San Gil, and Peña I (Tartanedo) and Canredondo I (Canredondo) in Guadalajara; Malagón I and Malagón II in Ciudad Real; and Los Pedreros (Fuente Álamo), Sierra de la Oliva (Almansa), La Losilla (Chinchilla de Montearagón), La Fuensanta (Peñas de San Pedro), and Casa del Aire I and II (El Bonillo) in Albacete. Photovoltaic technology In terms of photovoltaic technology, including Ocaña (Toledo), Naturgy operates eight solar plants In terms of photovoltaic technology, including Ocaña (Toledo), Naturgy operates eight solar plants. Picón I, Picón II and Picón III (Porzuna) and La Nava (Almodóvar del Campo) plants in the province of Ciudad Real and in Toledo, Carpio de Tajo (El Carpio de Tajo), which began operating in 2019, as well as the Toledo PV plant in La Puebla de Montalbán, which is the oldest in Europe as it began operating in 1994. In addition, the Canredondo plant was commissioned in Guadalajara in 2021. Finally, in terms of hydropower generation, the company operates nine hydropower plants in Castilla-La Mancha in the provinces of Guadalajara, Cuenca, and Toledo, and one mini-hydro plant in Guadalajara. Energy Transition Naturgy remains committed to promoting the energy transition and the development of renewable projects. The group has 7.3 GW of installed capacity internationally. During 2024, the company commissioned 842 MW, of which 271 MW corresponds to projects in Spain, 555 MW in Australia, and 14 MW in Latin America. The company invested a total of 926 million euros to develop this new renewable capacity, of which 374 million euros were in Spain. These investments confirm its commitment to a more sustainable energy mix, as well as its commitment to the energy transition, without neglecting the fundamental objectives of value creation and growth for each of the businesses, as well as ESG objectives.

Naturgy has signed with Bioeco Energías for its incorporation into the major project promoted by the energy group for the development of biomethane plants in Spain. Both companies have agreed to develop new facilities with a joint capacity to produce more than 500 GWh per year. The new production will be added to that planned in the partnership recently signed by Naturgy and Hispania Silva, bringing the total biomethane production capacity to 3TWh. This figure is equivalent to the annual consumption of 600,000 households and, from an environmental perspective, will reduce CO2 emissions by an amount equivalent to planting 59 million pine trees. Strategic energy vector Biomethane produced at these plants will be distributed to households and industries  Biomethane produced at these plants will be distributed to households and industries through existing gas networks, without requiring additional investments in the end-consumer’s energy installations. This makes renewable gas a strategic energy vector to drive a competitive and fair energy transition with a clear commitment to the circular economy. The projects signed with Hispania Silva and Bioeco Energías provide a sustainable management solution for local waste, contributing to the circular economy and returning zero-kilometer organic fertilizers and non-polluting irrigation water to the countryside. Circular economy  Naturgy also reinforces its commitment to the circular economy by entering the capital of the Hispania Silva group company - Recycle, which will be responsible for waste management for the new plants and those included in the agreement with Hispania Silva. José Luis Gil, Managing Director of Naturgy Renewable Gases, highlights the knowledge, empathy, and territorial proximity of Bioeco Energías and its sensitivity to the rural environment. Naturgy partners with Bioeco Energías "We are delighted with this partnership with Bioeco Energías. It brings its experience in the territory, which allows us to know first-hand the needs and sensitivities of the environment with which we are going to coexist during the operation of our plants," explained José Luis Gil. In the words of Leticia Sanchiz, CEO of Recycle, "Naturgy gives us the peace of mind of knowing that the projects will be carried out with the guarantee of compliance with all safety standards." Renewable gas Naturgy aims to be the major company in the promotion of renewable gases in the Iberian Peninsula, both in short-term production and distribution of biomethane and in the development of hydrogen as an energy vector that will have a significant impact on the energy mix in the medium to long term. The company is well-positioned to take advantage of the opportunity offered by renewable gases to move towards decarbonization and is ready to deploy significant investments and resources in this business. Naturgy manages a broad portfolio of biomethane projects throughout the territory in different stages of development and already has three production plants in operation. In the coming months, another two facilities will be added that are in advanced development or construction in Utiel (Valencia) and Utrera (Seville).