Integrated Annual Report 2020

INTEGRATED REPORT

LET'S REBUILD A BETTER PLANET

ACCIONA's Sustainability Master Plan 2025 sets out its goal of both doubling the positive impact of its activities and becoming a recognised leader in the development of basic infrastructure assets with the added value of putting people and the planet at the centre, in short, regenerative infrastructure.

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Carta Presidente

MESSAGE FROM THE CHAIRMAN

The next few years will be dominated by the flotation of part of the energy division in 2021. With this deal, ACCIONA aims to raise funds to invest in renewable facilities that will enable it to reach 20 GW of installed capacity by 2025, double its current generation capacity"

JOSÉ MANUEL ENTRECANALES, CHAIRMAN OF ACCIONA

BUSINESS MODEL BUSINESS AS UNUSUAL

REIMAGINING THE FUTURE INVESTING IN THE PLANET

Business as usual has proven ineffective at protecting the most vulnerable. The way to address this challenge is to commit to a regenerative economy that enhances not only economic growth, but also sustainable development, understood as development that meets the needs of the present without compromising the capacity of future generations, ensuring a balance between economic progress, care for the environment and social well being, as well as the attainment of the SDGs.

INNOVATING IN THE SECTOR TO BOOST PRODUCTIVITY

ACCIONA gains an edge in bidding by adding an additional infrastructure microproject to the main project for which it is bidding. ACCIONA calls them 'adjacent projects', and they help close the shortfall in the attainment of the SDGs in the territory in question. One of the group's most appealing features is its ability to create synergies between projects and simultaneously meet different needs for any region.

SOLUTIONS

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ACCIONA SOLUTIONS

Any solution must have a positive environmental impact and provide growth while being both solid and profitable

ACCIONA develops and invests in many types of projects — transport, water, social, cities, real estate and finance — that respond not only to the challenges facing our planet, but also to the needs of small communities. This requires the company to have a different way of doing business, in which people's well being and environmental conservation take priority, and regenerative infrastructures are the way to make this a reality. Furthermore, in the continuous pursuit of a positive impact, the company achieves sustainable financial results and creates local value, contributing to communities' resilience and socio economic growth.

Todas las soluciones

ACCIONA contributes actively to achieving the SDGs by promoting social progress, environmental balance and economic growth in a combined manner

ENERGY SOLUTIONS

CLEAN ENERGY FOR A SUSTAINABLE ENERGY SYSTEM

ACCIONA was a pioneer in the renewable energy sector and continues to work to be a leader in the development of new technologies. To help accelerate the decarbonisation of the energy system, the company invests in innovative projects to increase the useful life and performance of renewable energy facilities. It also develops new energy solutions to get ahead of market trends and take advantage of new sustainable business models. In 2020, investment in innovation in energy solutions increased by 4%.

10,700 MWowned

97 %Availability

60 %Incidents resolved remotely

+32TWh of annual output under management

Energía

100% renewable with no fossil-fuel legacy, we have been the world's greenest electric utility for the last six years

TRANSPORT SOLUTIONS

TRANSPORT INFRASTRUCTURE TO CONNECT PEOPLE

Population growth and urban concentration in a context of climate emergency make transport infrastructure the foundation on which the sustainable development of society must be based.

The key to the company's success in transport infrastructure and services is that it covers the entire value chain, from identifying the opportunity, planning and financing through design and construction, to operation and maintenance of the finished project. This optimises synergies between the phases and enables comprehensive solutions to be provided in highly complex projects.

+ 5,000 kmof roads in over 25 countries

+ 15 awardsfor innovation and sustainability

+ 600 bridgesbetween areas of complex orography

+ 800 tunnelsmetropolitan, highway and railway

Energía

In over 100 years building railway infrastructure, ACCIONA has designed more than 3,000 km of line, including over 1,200 km of high speed track.

WATER SOLUTIONS

WE TAKE CARE OF WATER FOR A BETTER PLANET

Water scarcity, which affects 40% of the world's population, is increasing due to global warming.

ACCIONA is an established leader in R&D in the water business, based on technology applications and the ongoing digitalisation of the industry. The company focuses on optimising water prices, shortening facility construction periods and increasing the degree of recurrence in end to end water management. ACCIONA has a Water Technology Centre, which encompasses from laboratories to pilot tests and scale ups to industrial applications.

The company treats, purifies, reuses, desalinates and manages water for more than 100 million people in more than 30 countries around the world.

Energía

One third of the water ACCIONA processes is in countries with water scarcity

SOCIAL SOLUTIONS

WE CONTRIBUTE TO THE DEVELOPMENT OF MORE PROSPEROUS SOCIETIES

ACCIONA sees health, education and culture as central to society's progress in the context of the health crisis and the climate emergency. In other words, it puts people at the heart of its strategy. In order to contribute to expanding and guaranteeing social wellbeing, the group develops infrastructure solutions for health, education and cultural engineering, and for ecosystem conservation and the regeneration of the natural environmen

Hospital Infanta Sofía won the award in that category for its energy efficiency and water management

Energía

Maintenance and biodiversity conservation at 16 beaches in Almería. ACCIONA implements action plans to care for the protected beach flora and fauna by preserving their natural environment

CITY SOLUTIONS

SUSTAINABLE CITIES, SUSTAINABLE PLANET

Cities are the powerhouses of economic progress. They also hold 50% of the world's population. If we aspire to having a sustainable planet, cities must evolve to become more resilient, inclusive, interconnected and smart.

ACCIONA has a unit specifically configured to address the main challenges of building, mobility, water management and the circular economy. Through SMART solutions for sustainable cities, the group addresses issues such as improving waste management and the related infrastructure, and revitalisation of cities through green areas and clean, agile, efficient mobility, the goal being to enhance city dwellers' living standards.

Over 12,000 electric scooters available in 8 cities: Madrid, Barcelona, Valencia, Seville, Zaragoza and Malaga in Spain; and Milan and Rome in Italy.

Energía

The three energy from waste plants will dispose of up to 850,000 tons of municipal waste per year, producing up to 619 MWh of electricity.

REAL ESTATE SOLUTIONS

THE FUTURE WILL BE URBAN, BUT WITH SUSTAINABLE SOLUTIONS

ACCIONA's Business as Unusual approach involves designing eminently sustainable real estate projects in an urban environment. To this end, the company not only explores innovative measures in the field of energy saving and the reduction of CO2 emissions, but also seeks solutions to manage the water footprint, analyse building life cycles, promote alternative means of transport and foster accessibility, health and comfort for users.

Employees136

TURNOVER198millions of euros

EBITDA19millions of euros

Households+ 13,000

OHSAS 18001100 %Activity certification in Spain

ISO 14001100 %Real estate promotion certification in Spain

Inmobiliarias

ACCIONA is ISO 9001 and ISO 14001 certified, and has ISO 45001 certification in the area of health and safety; it is committed to obtaining BREEAM® certification for all its real estate developments.

FINANCIAL SOLUTIONS

ECONOMIC RESPONSES PREPARED FOR TOMORROW

Bestinver came into being more than 30 years ago as a small financial unit dedicated to the active management of family assets. Today, the firm has over 50,000 investors and manages 6.4 B € in assets. Through Bestinver, ACCIONA offers asset management and capital markets services, channelling savings and investment to companies while providing returns for investors.

In the area of asset management, the company's objective is to offer longterm returns through an investment philosophy based on fundamental analysis, appropriate risk management and a time horizon shared by asset managers and investors.

6,397 M€assets under management

4,593 M€mutual funds

50,000investors

30 yearsexperience

1,049 M€pension plans

755 M€Luxembourg UCITS and SICAVs

Financieras

In the immediate future, Bestinver will focus on launching a platform of private market products and the adoption and fulfilment of ESG criteria.

Ambition 2025

The 2025 Sustainability Master Plan (SMP) encourages ACCIONA to reimagine infrastructures. The ambition is to increase investment and double its impact.

Our plan

PEOPLE AT THE CENTER

The soul of a company is its employees. That’s why we place people at the center of our strategy, caring about their training, making them participate in corporate challenges and retaining their talent.

Leadership

We develop agents of change capable of providing differential values.

Diversity

We try to be more diverse because this will make us better.

Recognition

We recognize excellence and outstanding effort.

Environment

We create smart and safe work environments that reflect our values.

Access

We ensure compliance with fundamental rights.

Personas
Our plan

PLANET POSITIVE

To create a positive impact, we invest in the development of technology and projects capable of regenerating the planet. We focus on providing solutions that accelerate the process of reducing carbon emissions and mitigating climate change.

Climate

We would like to continue to be recognized as main actors of the transition towards a decarbonized economy.

Biodiversity

We generate positive net natural capital. In addition to our ethical commitment, it is a necessary condition to advance towards global sustainability.

Circularity

We can develop zero waste projects and avoid the generation of garbage as much as possible.

Water

We significantly increase the supply of quality water and its sustainable use with highend technology.

Planeta
Our plan

EXPONENTIAL LEADERSHIP

Authenticity, transparency. We follow a purpose. ACCIONA has a deep leadership vocation in this decade’s sustainable transformation.

Authenticity

The ACCIONA team recognizes trustworthy and credible people in management, with values and commitment.

Sustainable transformational innovation

Development and Innovation (RDI) and in promoting an open innovation model.

Transparency

In addition to the Sustainability Report, the company publishes two more corporate reports with ESG (environmental, social and governance criteria) information of interest.

Governance

ACCIONA's tax policy defines the company's approach to tax matters, as well as its consistency with the global business strategy

Liderazgo
Our plan

INTEGRATE TO TRANSFORM

To create a unique value in each initiative and generate a positive impact, we integrate the current challenges and focus on sustainable solutions.

A solutions based approach

A value proposal based on integrated infrastructures designed to increase our contribution to the Sustainable Development Goals.

Sustainable difference in each project

The sustainable difference we offer is apparent in every project and business line. We develop our own recognizable and regenerative self-identity

Regenerative ecosystems

We dialogue, co-create and work together with clients and suppliers to design better solutions that close social and environmental gaps in reaching SDGs

Impact financing

We maximize the capacity of sustainable financing to strengthen the value of the company, as well as the regenerative advantages of our projects

Transformación

Results

2020 Results

Given the need to address the challenges that traditional business had failed to handle, in 2018 we developed a new business model: Business as Unusual. By implementing this strategy, the financial objectives have been met every year. The roadmap to position our company in a new sector has produced the following results:

Resultados 2018
Resultados 2019
Resultados 2020

INDICATORS

Financial

EBITDA growth compared to the previous year

2018

2019

2020

EBITDA decreased in 2020 due to the impact of the pandemic

Increasing or maintaining the group's net margins (Profit / EBITDA)

2018

2019

2020

Constant improvement of business productivity

Increasing and stable dividend distribution

2018

2019

2020

FY19 dividend was adjusted due to the impact of the pandemic

Similar investment or increase in gross CAPEX compared to the previous year

2018

2019

2020

Disinvestments have been a strategic part in the management of FY20

Debt/EBITDA ratio below 4x

2018

2019

2020

In FY 2020, due to the pandemic, the target was adjusted * to contain the ratio below 4.5x

Target return on investments made above the WACC + 200-300 bp

2018

-

2019

-

2020

-

Target to be met in the coming years

Non financial

Increase in installed capacity for renewable electricity production

2018

2019

2020

Achieved target of exceeding 10,500 MW to reach 10,694 MW

Lower accident rate

2018

2019

2020

34% reduction, against a target of 15%.

Alignment of CAPEX, EBITDA and Sales with the taxonomy

2018

N.A.

2019

2020

In FY2020 85% of CAPEX is achieved (target: 90%) and 84% of EBITDA (target: 80%). In 2019, the alignment exceeded these goals

Increase the net percentage of women in management and pre-management positions

2018

2019

2020

The percentage is increasing to 20.7%, but the goal of 23% has not yet been met

Reduction of greenhouse gas emissions

2018

2019

2020

Reduction by 38% compared to 2017, exceeding the science-based target

Landmarks

Hito 1

January

AUSTRALIA AND HONG KONG

We will build and operate our first desalination plant in Hong Kong. In addition, we won a € 300 million contract to carry out railway works in Australia.

Hito 2

February

BLOCKCHAIN, CHILE

Pioneering use of blockchain in emissions trading in partnership with ClimateTrade. On the other hand, K + S gives us the contract for the 100% renewable electricity supply for its facilities in Chile.

Hito 3

March

SCANDINAVIA Y QUEENSLAND

Together with Ghella, we signed a € 1 billion contract to develop the longest railway tunnel in Scandinavia. In Queensland (Australia) we will build a 1,026 MWp wind farm.

Hito 4

April

ARABIA SAUDÍ, INVESTMENT GRADE, KKR

We will build our fourth desalination plant in Saudi Arabia. The DBRS Morningstar agency assigned us the Investment Grade credit rating and together with AXA IM-Real Assets we purchased KKR's 33.33% stake in ACCIONA Energía Internacional.

Hito 5

May

CONTINUITY AND TECHNOLOGICAL COMMITTMENT

We ensured the continuity of our businesses and services, some of them essential, and we launched several cooperation initiatives. We developed a digital twin of a desalination plant.

Hito 6

June

HEALTH AND SUSTAINABILITY

We will build a children's hospital in Panama and will become the world's largest motorsharing operator.

Hito 7

July

VANCOUVER, EAST ROCKINGHAM AND ANOTHER INNOVATION ACCOMPLISHMENT

Preferential offer for the Vancouver underground with a contract of € 1,820 million. The East Rockingham plant (Australia) was recognized by IJ Global AS as the best financial agreement in Asia-Pacific in 2019 in the waste category. We inaugurated the first floating photovoltaic plant connected to the Spanish grid in Extremadura.

Hito 8

August

LEADERS IN SUSTAINABILITY

According to the Sustainalytics ESG Risk Rating, we are the best company in the multi-utilities sector for the environmental, social and corporate governance task that we carry out. We also ratified our presence in the FTSE4GOOD sustainability index.

Hito 9

September

CHILE, PHILIPPINES, LENDLEASE

Relaunching our investment in Chile with a 238 MWp photovoltaic complex, closing the acquisition of part of the Lendlease Engineering's project portfolio and building a railway line in the Philippines for € 560 million.

Hito 10

October

SAO PAULO AND GREEN HYSLAND

We signed the concession contract for the construction and operation of line 6 of the Sao Paulo subway and presented Green Hysland in Mallorca, the first green hydrogen project in a Mediterranean country chosen to receive European financing.

Hito 11

November

210 MWP OF CLEAN ENERGY

We will build 210 MWp photovoltaics in Spain to supply clean energy to Novartis.

Hito 12

December

RENEWABILITY AND WATER IMPROVEMENT

Launching our largest wind farm in the United States, La Chalupa (198 MWp).

Construction of our fifth desalination plant in Saudi Arabia for € 315 million and completion of the Al Khobar I desalination plant, also in Saudi Arabia.