Endesa, S.A. (ELE) Earnings Call Transcript

Good day, dear shareholders. Thank you very much, everyone, for your telematic participation. And I'd like to, first of all, welcome you to this event on behalf of the Board of Directors and on my own behalf. For the second year in a row and in view of the health situation caused by COVID-19 and in order to protect the health of shareholders, employees, suppliers, directors and citizens in general and following the extraordinary measures established by law regarding the holding of General Shareholder Meetings and specifically considering the provisions of A Section 1, Article 3 (sic) [ Article 3, section 1.a) ] of Royal Decree 34/2020 of 17 November on urgent measures to support business solvency and the energy sector and on tax matters, as amended by Final Provision Eight of Royal Decree-Law 5/2021 of 12 March, Endesa's Board of Directors has decided to hold its 2021 Annual General Shareholders Meeting exclusively by electronic means without the physical attendance of shareholders or their proxies. Technology today helps us to be able to hold this meeting with the online presence of many of the shareholders through the channel provided on our website. I'd like to thank you all who have joined us through remote attendance. In addition, as every year, electronic voting and proxy voting was available to shareholders. It is necessary to verify compliance with legal requirements for the valid constitution of this general meeting. I'll give the floor to the secretary, who, together with me, will have the powers of organization provided for in the rules of procedure for the Board.

Thank you very much, Mr. President. Good morning and good day, dear shareholders. We hereby notice that this meeting is being held exclusively remotely without the physical attendance of shareholders or their representatives, and for legal purpose, it is considered to be held in Madrid at the registered office of Endesa, 60 Ribera del Loira street at 12:30 p.m. at 30 April 2021. The General Shareholders Meeting of Endesa, S.A. will meet in a single summons to the General Shareholders Meeting on 30 April 2021. The announcement of the call was published on 24 March 2021 on the official gazette of the commercial register, on the company's website and on the website of the National Securities Market Commission as deemed -- and is hereby deemed to have been read and understood for all purposes. We have required the presence of a notary public to record the minutes of the meeting, and we have Mr. Francisco Javier Gardeazábal, notary of Madrid, to draft the minutes of the meeting. The proposed resolutions promoted by the Board of Directors on the items of the agenda and the corresponding reports have been available to shareholders since the publication of the meeting on the website and for shareholders connected telematically, is also available on the telematic systems app that you're accessing these through. Therefore, this is deemed to have been read for all intents and purposes. We'd like to inform you that an independent expert is coming out with a review of compliance with the procedures for convening and holding the General Shareholders Meeting and general review of the voting and proxy process, from which it appears that pending the conclusion and final verifications, systems and procedures applied by Endesa are in accordance with current General Shareholders Meeting regulations in force. Finally, it should be noted that a reliable electronic publication service provider has verified that from the date of publication of the call of the meeting and until 10:30 today, General Shareholders Meeting documents on the website, www.endesa.com, have remained published on the aforementioned website without interruption, available with the possibility of downloading and printing them and unaltered. The attendance list has been drawn by computer in accordance with the terms published in Article 98 of the mercantile register regulations and duly completely shall be attached as an annex to the minutes. And the attendance quorum is as follows: so shareholders considered to be present by law, they are not physically present but the law considers them as present, 537, representing 744,314,565 shares, representing 70.301% of the share capital; legal representatives of shareholders, 2,427, representing 161,869,938 shares, representing 15.289% of the share capital. So altogether, we have 2,784 shareholders and 906,184,403 shares, representing 85.590% of the share capital with voting rights. And that entails a valid quorum for the constitution of the General Shareholders Meeting and to deal with all the items included in the agenda. Endesa has a treasury stock of 8,799 shares, representing 0.008% of total -- of the share capital. The treasury stock has been included to calculate the necessary quotas for constituting and adopting agreements in the GSM. In agreement with law, the voting rights of these shares is suspended. Dear President, dear Chairman, please go ahead.

Thank you. In view of the definitive data provided by the secretary, we confirm the requirements necessary for the valid constitution of the General Shareholders Meeting on a single call so that we can -- may decide on all the items on the agenda. The voting channel for shareholders attending this meeting electronically will be available until the secretary completes the reading of the proposed resolutions. The bureau is composed by the members of the Board of Directors present in this auditorium and those connected by audio conference to the telematic meeting. We give the floor to the notary public.

Thank you, dear President. In compliance with Article 101 of the Mercantile Register Regulation, I hereby declare that I have been requested to attend this General Shareholders Meeting being held exclusively electronically to draft the minutes of the meeting. I hereby declare that I'm presenting in the auditorium of Endesa's head office. I have checked that the meeting has been convened in accordance with legal requirements and have verified that the means of real-time remote communication used by council members and Board members who are bureau members and were not physically present adequately ensure the constitution of the Board and of the meeting. Finally, if there are reservations or protests regarding sentiments on valid constitution of the Board, please do so now through the use of the IT assistance application for the record. Mr. President, having checked the information, there are no reservations. I'll give the floor back to the President.

Thank you. I'll give the floor to the secretary now.

Thank you. In accordance with the shareholder -- company's law and regulations on general meetings, shareholders have been able to request such information, clarifications as they deemed necessary regarding matters included in the agenda of the call of the meeting, information as well to the public that has been provided by the company to the security market commission since the last general meeting was held and/or regarding the auditor's report. Because of the characteristics of this meeting, a computer application has been made available to shareholders in the company's website in order to attend remotely and to allow shareholders to exercise their right to information in writing. For this reason, in this meeting, there will not be speaking turns as such, but requests for information and clarification that shareholders may have made up to 12 noon today will be forwarded to this meeting through the computer application for telematic attendance. On that, in accordance with the law and the call of the meeting, an attempt will also be made to respond to these requests during the meeting. If this is not possible, a written reply will be sent to shareholders within 7 days, as stated by law. Dear Chairman, dear President?

Dear shareholders, we're pleased to share with you all of the rendering of the accounts for the financial year 2020. We have made available to you very extensive information that sets out in detail the development of this financial year and the resolutions proposed for approval by the general meeting. In particular, I must mention the preparation of the new statement of nonfinancial information on sustainability 2020, describing how Endesa meets its fundamental commitment to sustainability. Endesa has lifted 2020 financial year practically in its entirety under the very serious effect of the COVID-19 pandemic. We have experienced and keep experiencing a health crisis with an unprecedented social impact in recent history. And thus, the Board of Directors remembers all the victims of COVID-19, their families and loved ones. Our condolences go especially to all Endesa and Enel colleagues who died as a result of the virus. Our condolences also go to the family of our contractor's worker who died in an accident while repairing a transformer station in Seville. The pandemic has posed multiple challenges for our company. From the first moment of the crisis, we felt that, in addition to normal development of our business, Endesa had to act in many different areas. Our company was involved in an exercise of solidarity in agreement with the seriousness and exceptional nature of the situation. Faced with an emergency that forced of us into confinement, separation and distance, society was calling for support measures to help alleviate the impact of the pandemic on the lives of so many people, families and communities. At the 2020 General Meeting, we presented our public responsibility plan, a plan with which Endesa and its foundation had been tackling the consequences of the pandemic on our community, deploying direct aid in the health, social and economic spheres. The plan has included activities that are supporting those hardest hit by the crisis in attempt to collaborate to maintain economic activity. These are actions for a total amount of EUR 25 million, which have so far benefited more than 2 million people and whose details you will find, dear shareholders, in the documentation made available to you. Protecting the health of our employees and families and that of our partners, we also [ rolled out ] safety and prevention measures at work: firstly, regarding the essential jobs requiring presence; secondly, by accelerating the use of technology for all jobs that could be performed remotely. And we have adopted these measures to our contractors and suppliers. This same organizational responsibility and the utmost caution are our priority criteria in the scenario of an eventual and progressive return to normality in Endesa's operations. The challenge posed by the health crisis was compounded by the other extraordinary events such as extreme weather events on the first few days of 2021. Dealing with the consequences of this snowfall and extreme temperatures was possible thanks to the determination and commitment of Endesa's employees and collaborators. Executing continuity of the electric supply in such difficult times as those experienced at the time are a factor of feasibility for the entire community. The 2020 financial year has enabled Endesa to make progress in the sea of change in which its activity and businesses are immersed as the CEO will explain his speech. This change is taking place on multiple levels, all of which point towards the common goal of energy transition, which has received additional incentive on the international stage. The European Union was right to consider the fight against the pandemic required a historic response that was equal to the challenge, making energy policy a priority and one of the keys to this response. The steps designed to ensure that the financial resources reach their designation will be implemented, as stated by the regulatory framework that should support this transition process. The energy transition is now a priority policy and demanding from each company response in its respective position. Endesa, to calm the challenge posed by this environment, [ double downed on ] innovation with the aim of specifying the aims that are usually included in the notion of sustainability as an expression of precise objectives in the economic, social and environmental spheres. The presentation on November 2020 of the new strategic plan 2021-2023 and its accompanying sustainability plan 2021-2023 expressed an intention to accelerate the changes that have previously been set in motion. The new plan significantly increases investment to advance decarbonization and digitalization. With these measures, Endesa stands out in the reconfiguration of our energy sector and contributing to a new economic model. We're doing so with specific measures to demonstrate our ability to lead the transition process. We are aware of all the consequences of this transformation process, and we respond to that with companion plans, implementation of the Agreement for a Just Transition of April 2020. These plans are aiming to reactivate the areas affected by energy transformation. These areas are linked to Endesa's history, and we want them to remain so in the future. The companion plans express our concern to ensure that the new activities to be developed in these areas result in the employment of the population and the continuity of their economic activity. Equally, Endesa has also presented a catalog of projects that aim contributing to the process envisaged in the recovery, transformation and resilience plan approved a few days ago by the Spanish government. The implementation of this plan will provide additional impetus to the energy transition process. On the other hand, we have confirmed that willingness will translate institutional coordination into solutions that favor access to electricity supply for vulnerable social groups. Thus, the recent agreement with Generalitat in Catalonia has meant, amongst other measures, the cancellation of the debt accumulated by 35,000 families in a vulnerable situation. Regarding Endesa's corporate governance, numerous measures have been proposed or adopted throughout 2020. And this applies a special attention to development of best practices, which we're integrating into our system and which ensure our status as a benchmark in terms of transparency. We have a corporate governance system that we want to consolidate based on the annual evaluation by the Board of its operation and that of its committees, carried out with the support of an external adviser. In 2020, our system has been modified with incorporation of changes required by the new law and approved by amendments to some corporate policies. Thus, we have taken into account the recommendations derived from the current code of good governance of June 2020 and various measures in anticipation of the subsequent approval of the recent law filed 2021 on 12th April on the promotion of long-term shareholder engagement. We suggest several amendments to the articles of association and the regulation of the general meeting of shareholders, in particular those relating to the holding of meetings by electronic means and attendance on such meetings as an option which, on the basis of recent experience, seems appropriate to be included in the articles of association and the aforementioned regulations. Regarding regulations, the report you shall find changes made to these have been available to you as shareholders. In the different Board committees, several changes have taken place. Endesa has not followed recommendation 48 regarding having a nomination or an appointment in remuneration committee. The explanation lies in our experience. The existence of single committee ensures coordination required and necessary between the 2 committees. It is split among appraisal and remuneration, talent attraction and retention and results orientation. In 2020, the Audit and Compliance Committee and the Appointments and Remuneration Committee were reorganized. In line with important sustainability, Endesa's governance and business and following the resolution of the General Shareholders Meeting to create it, the sustainability and Corporate Governance Committee began to operate. The presence of independent directors of each of the committees has been maintained at least 75%. All communities have been attended with 40% of female directors and independent directors were appointed as chairpersons. The corresponding interactive report detailing the activities of each of the Board committees during the 2020 financial year is available to all of you. The diversity [ and inclusion ] policy set by the Board in relation to present and future composition of the Board have been further developed. The diversity policy will also be reinforced in the senior management regime. The good governance of the company is an organic performance based on the individual performance by each of the directors of their respective duties, functions and competencies. My gratitude, therefore, to all directors for their performance throughout 2020. I must especially emphasize that the Directors Alejandro Echevarría and Miquel Roca have reached the end of their term after serving on Endesa's Board of Directors for 12 years, a period during which our company has benefited from their experience and prestige. On behalf of the General Shareholders Meeting, Endesa's Board of Directors, I would like to express to both our appreciation and gratitude. Endesa had a positive view in 2020, dear shareholders despite exceptional circumstances arising from the pandemic. It has achieved this thanks to various factors or characteristic of our company, starting with the trust placed in us by our shareholders and then some benefits from ability, capabilities and competitiveness provided by its membership of the Enel Group. It also benefits from the commitment of all our employees and special performance of the management team, led by the CEO, José Bogas, to whom I would like to hand over the floor now. Thank you very much.

Dear shareholders, good morning. Today, we are holding this Annual General Meeting in order to account for what I would call a unique, special and unprecedented fiscal year in history. And for that reason, I would like to start this address by recalling all those who passed away due to COVID, their beloved ones and all those whose health or professional life has been affected by COVID. And I would also like to express a heartfelt message to all of Endesa's employees who suffered the impact of the pandemic. These have been and continue to be difficult times for many people that's why I would like to acknowledge wholeheartedly all of Endesa's workers who have worked in order to continue securing our activity, that is the ongoing supply of energy. Thanks to all of our employees, we have been able to attain the target set, that is surpassing our guidance and continuing to making progress throughout our road map. This road map will enable us to go through the biggest industrial reconversion process in our sector, and we intend to be more sustainable, more digital, more efficient as leaders as well as a business reference in a world that would certainly be different. Fiscal year 2020 was totally marred by the pandemic. Spanish GDP fell by 10.8%, something that had never happened in recent history. Electricity demand already showed some signs of weakness in the early months of 2020 due to a drop in demand in the manufacturing sector. Between mid-March and mid-May, the drop was up to 17%, that was the toughest part of the pandemic, until it recovered gradually, dropping 2% to 3% in the last quarter of the year. All in all, the accumulated drop was 5% in the peninsula, 19% in the Balearic Islands and over 10% in the Canary Islands. The service sector having been the one that was hit the hardest in addition to the hotel, catering, auto -- car and steel industry. Now I would like to talk about the process of reconversion towards sustainability, but I would like to mention the key financials that enable me to state unequivocally that 2020 was an excellent year despite of the tough environment. Last year, we were able to report a net ordinary result of EUR 2.132 billion, up 36% compared to 2019, therefore going beyond the guidance. This profit increase will enable us to pay out dividend 37% higher compared to the previous year, specifically EUR 2.0136 per share, and 6% higher compared to the guidance. EBITDA, on a like-for-like basis, stood at EUR 4.027 billion, 5% more, therefore exceeding the target of EUR 3.9 billion. Our sound focus on sustainability has been acknowledged. 50% of our share capital is already tied to ESG criteria or to environmental, social and governance criteria. Therefore, we also keep a significant presence on world's socially responsible investment indexes. We also made progress in decarbonization. In June last year, we shut down the Compostilla and Teruel plants. Through these shutdowns, 85% of our peninsular production is now emission-free, something that we had planned for 2022 but we were able to do in 2020. We also reinforced our leadership in electricity mobility by deploying a public and private network of 7,072 charging points, that is to say 41.4% higher compared to the closing of 2019. We also proved our huge strength in a challenging year like 2020. In addition, we also put in place our reconversion plans in order to become more flexible and efficient in our generation, distribution, commercialization businesses. All in all, during the year, Endesa obtained a market share of 18% in terms of generation, 49.9 -- 42.9% in distributed energy and 32.4% in terms of electricity sales. All these figures therefore show once again that we are the leading company in the Spanish electricity sector. Dear shareholders, the world has changed. The energy sector is now immersed in a very deep industrial reconversion process. And our position in the face of this transformation is one of the utmost responsibility. But in addition to the reconversion of the energy sector, renewable generation, smart grids, demand electrification and energy efficiency will certainly have a dragging effect in highly CO2 emitting sectors such as transportation or the manufacturing sector, among others, and this is no doubt good news for sustainable development. So if prior to the pandemic, we used to speak about the fourth industrial revolution given the determinant role played by technological companies, the worldwide pandemic has placed climate change and sustainable future at the very core of our lives, at the core of the economy and has also changed the paradigm of business management models. In this new global framework, the electricity sector has a key position, and the Enel Group is one of the key players at a global level, the same as Endesa, in Spain and Portugal. For that reason, I'm speaking about a huge degree of responsibility that is about deploying all of our plans with a sustainability perspective. We are talking about comprehensive sustainability to fight against climate change but also in favor of inclusion, diversity, equity, ethics and transparency. To be a company that fails to be sustainable will not be profitable nor will it add value nor will it have a future, and that is where our strategy backbone lines. Throughout this fiscal year, we proved that we can be profitable while contributing value to our shareholders through a sustainable model, a model that is based upon creating clean processes, distributing energy in a reliable and efficient manner and driving demand electrification, a model that places customer at the center, thanks to the opportunities provided by digitalization and the possibility of working on a platform-based model. We are moving towards a world where society and users are increasingly asking for managing their own resources, sharing and reusing them. So the circularity of this process means that we will have to include circular economy parameters into our work model and think of energy as a service rather than as a product. Companies need to face this revolution from disruption and innovation. Both social demand and the new management models will lead us to a deep social and business transformation, and this was part of our endeavor in 2020 and will remain so in 2021. I would also like to mention, within the framework of our sustainability actions, the efforts made by Endesa in order to implement the public responsibility plan against COVID. EUR 25 million were allocated and 2 million people were benefited from these plans through more than 150 agreements. We provided assistance in the health care sector as well as in the employment and social and economic spheres. We should also add EUR 55 million that were allocated to the social board. This is our contribution to make sure that nobody is left behind due to the pandemic. Dear shareholders, in the post-COVID context that we begin to envisage, it's absolutely mandatory to foster energy transition, smart investment in networks and household electrification, electrification of companies and mobility. Our road map is clear, and it can be speeded up by the Next Generation funds. If properly done, I am under assumption that we will take advantage of this package in order to speed up the transition and do it in a sustainable manner. I would like to recognize the progress made in this respect by the government through the Ministry for the Ecological Transition and the Demographic challenge. Within the energy and climate strategic framework that was put in place by the ministry, I would like to highlight the progress made in terms of regulation across the decarbonization process in Spain. This is no doubt a good start, even though still a lot to be done. Spain has a climate and energy transition change bill that is pending approval by Congress. It has also laid the groundwork for a circular economy strategy. It has also approved the national integrated energy and climate plan that has already been submitted to the EU and which covers an ambitious plan to reduce emissions. It has also submitted the second national plan for adaptation to climate change within the framework of the 2030 Horizon (sic) [ Horizon 2030 ]. It also has a long-term decarbonization strategy that paves the way in order to reach climate neutrality by 2050. It has also developed an early road map for renewable hydrogen that should be a driving force in order to build a truly Spanish industry around hydrogen. It has also approved a new electricity tariff structure made up of a toll circular and a royal decree on tariffs in order to foster the use of electricity network at low rates when its capacity is idle. As a result, we would be able to promote electrical, rechargeable, sustainable mobility, self-consumption, storage and demand management. It has also prepared a bill for the national sustainability fund of the electricity sector that cast some clear signs in favor of electricity and that will have a very positive repercussion on the economy electrification. This bill, that is about to be discussed in Parliament, is aimed at dealing with the high cost brought about by the first wave of renewables in the first decade of the 21st century. And despite the fact that it was an obligation in final consumption of all energies, it was only borne by the electricity client. Therefore, as of now, these efforts will be shared gradually among all of the energy sector players, not only in the electricity sector, therefore freeing or relieving the electricity client from this burden. After the electricity system sustainability fund and after the new structure of tariffs, we believe that this is critical, and it will be a breaking point for demand electrification based on clean energies. This internal reform framework will therefore enable us to take significant steps forward, but it's also important to highlight the huge opportunity entailed or brought about by the Next Generation funds. This is an unprecedented recovery fund comprised of EUR 750 billion, including both loans and subsidies, out of which EUR 140 billion will be earmarked to Spain. This is a fund which is significantly higher and different from the Marshall Plan that was used by Europe at large between 1948 and 1952. So it's bigger not only because of the amount involved. The Marshall Plan totaled EUR 112 billion current currency. And we can say that Spain is going to be one of the members that will benefit the most. We believe that this is no doubt a good opportunity to improve our short-term and medium-term economic outlooks and also in order to transform our economy, both in the medium and in the long term. For this package to be effective, an integral and coordinated strategy is being put in place in order to identify investment proposals hand in hand with thriving companies like Endesa. Endesa submitted projects to the government in the amount of EUR 19 billion, but we have continued to develop new initiatives and projects within the reconversion and recovery framework we foresee. We have also reviewed our plans and projects upwards. That's why today, I would like to announce the total investment that we will be submitting for the recovery, transformation and resilience funds will total EUR 23.3 billion in aggregate, allocated throughout 122 projects. So the distribution of this investment by geographical area would be EUR 2.655 billion, this will be allocated to energy transition across extra-peninsular territories; EUR 19.918 billion through the energy transition in the peninsula; and EUR 727 million to the energy transition process in Portugal. As for the different types of projects, the breakdown would be: smart grids, EUR 3.7 billion to EUR 7 billion, out of which EUR 2.542 billion will be allocated to automating the network and EUR 1.185 billion will be allocated to operational enhancements; sustainable transportation, EUR 793 million; building retrofitting, EUR 2.192 billion; renewable hydrogen, EUR 2.955 billion; storage and flexibility, EUR 4.56 billion; renewable energies, EUR 8.188 billion; circular economy projects, mainly blade and battery recycling, EUR 21 million; and plant streamlining, another EUR 865 million. So as you can see, this is a powerful set of projects based on energy transition, development of renewable energies, energy efficiency, renewable hydrogen, sustainable transportation or development of smart grids. So this project pipeline would certainly help our country recover by creating 240,000 jobs all in all, while reducing CO2 emissions by 13.6 million tonnes per year. Ladies and gentlemen, we are already but we shall continue to be, no doubt, one of the key industrial investors in Spain in the forthcoming years and a key driving engine to the country's economic recovery. In this respect and in the context of these challenges at Endesa, we have been working on a permanent basis in order to be a key player for the future. On November 25, we submitted our strategic -- '21-2023 strategic plan, and we have also submitted our vision for 2030. We want to increase our investment in renewables and digitalization, and we also want to focus on electrification of household demand. And we also want to focus on the manufacturing sector and transportation to speed up energy transition and decarbonization. The new 2021-2023 strategic plan that we submitted to investors foresees to increase gross investments by 25% compared to the prior plan, up to EUR 7.9 billion in order to expedite decarbonization and digitalization. With regards to renewable energies, we foresee to grow by 50% in terms of our fleet, making an investment in development of EUR 3.3 billion. That is 20% more compared to the prior plan. That way, next year, we will be the integrated electricity company with the lowest amount of emissions in the Iberian Peninsula. As for networks, we estimate to invest EUR 2.6 million (sic) [ EUR 2.6 billion ], this is a gross amount, 30% more from what we announced in our strategic plan. We will be able to improve our service quality and therefore, our efficiency. As for demand electrification, we will channel all of our efforts through Endesa X by increasing service contracts by 42%, reaching 2.7 million households. As for the charging point deployment plan for electric vehicles, we'll reach 56,000 charging points that will be installed at the closing of 2023. So 89% of this investment will be directly related to the attainment of the UN SDGs according to the new taxonomy set forth by the European Union. So this plan has been supplemented with a 10-year view with investments that have been projected in the amount of EUR 25 billion until 2030. Therefore, by 2030, 80% of all of our output, including that of non-Peninsula systems, will be CO2-free. As for the estimated investment until the end of this decade, EUR 10 billion will be allocated to implementing new renewable power in order to reach a minimum of 18,000 megawatts of installed capacity and an additional EUR 10,000 million will be allocated to digitalization and modernization of the network to streamline the service, being more efficient, improving quality indicators and the networks' resilience while integrating renewable capacity and fulfilling electricity mobility targets. Finally, we have set ourselves the goal of reaching out to more than 7 million customers on the free market by providing a platform-based subscription service, providing flexibility mechanisms for household demand and business demand with more than 1,000 megawatts and also reaching 575,000 recharging points for EVs at the closing of 2030. So power and investment capacity that will make it possible to improve the quality of life in Spain while supporting the creation of new jobs. Having come to this point, once we have shared with you our vision, performance and outlook for the future, I would like to explain very quickly the role played by more than [ 9,000 ] employees at Endesa that did a terrific job during this fiscal period. Our human team is our best asset. So I would like to send my appreciation to all of them as well as to our business areas, generation, distribution, Endesa Energia, Endesa X, nuclear and energy management for making progress along the road map that we have in terms of decarbonization, digitalization and demand electrification. All lines of business played a key role in a complex environment, always with a customer-centric approach. Then we should also mention other staff units such as administration, finance control, audit, institutional relations, media regulation, general secretarial, legal department, procurement, digital solutions, sustainability, people and organization and communication. Thank you to all of them for supporting the business and for enabling us to anticipate such future changes and being able to be up to the challenges that will enable us to continue to be leaders. Dear shareholders, as you can see, our commitment to you and to Spain and Portugal, our main spheres of action is unchallengeable. Endesa is and continue -- will continue to be a thriving company that will contribute to economic recovery after the health crisis. We are one of the #1 manufacturing investors in the country. We pay taxes in the amount of more than EUR 4 billion on average per year. We also generate direct and indirect jobs, and we work with nearly 5,000 vendors, most of them small and medium-sized Spanish companies. At the beginning of my address, I've mentioned the industrial reconversion process. Well -- and the areas where we shut down some coal plants. Well, I would like to say that the commitment of our company for -- or to a future that is more sustainable and just should be measured by actions and not only by words. That's why I would also like to underscore, dear shareholders, that Endesa was critical in providing services to small villages, especially in areas where supply was mainly based on the coal energy mix. That's why today, we are a company that is committed to future plans in each and every area that has been affected by the shutdown of coal plants, that is we are not leaving behind and we are not going to neglect the areas where we have been present for many decades because this is already part of our history. We shall remain there with new ways of working, with a sustainable model over time and with a fair transition model with a focus on not leaving anybody behind. In the next 5 years, we plan to invest more than EUR 4.5 billion in those locations where coal plants will be shut down in order to develop new renewable projects and new green hydrogen projects for those areas. In Andorra and Teruel, we will develop 1,725 million renewable megawatts with an investment of EUR 1.487 billion, creating more than 1,000 jobs per year in the next 4 years. As for the Compostilla future plan in León, we are going to develop 780 renewable megawatts with an investment of EUR 600 million. All these projects will be carried out together with the shutdown of the plant in the next 5 years, and they will create more than 1,000 jobs annually. So we are also fostering the creation of significant or a major sustainable manufacturing hub that will be referenced in the peninsula. In As Pontes, we proposed to replace 1,468 thermal megawatts in the plant for 1,505 megawatts of renewable energy in the 20 -- 2026 period. We will therefore invest EUR 1.580 billion and we will create about 1,250 direct jobs on average in the next 6 years of construction. In Andorra and Compostilla, we also have some green hydrogen-related projects, even though As Pontes is the one that is the most advanced out of the 23 projects we have in the pipeline in Spain. In As Pontes, we will have a wind hub for Endesa to carry out all the logistic operations and maintenance work for the wind -- our wind farm in Spain. In Almeria, our future plan covers, on the one hand, the construction of 1,520 megawatts of solar and wind power. We will therefore invest EUR 1.2 billion, and we will create 700 direct jobs on average in the next 6 years of construction. As for the Alcudia plant in Majorca, we are analyzing the development of up to 73 solar megawatts in the central area. So ladies and gentlemen, as you can see, our best way to present ourselves before you is to present all these facts. At Endesa, we will grow and we shall continue to remain leaders in the electricity market in Spain and Portugal within a sustainability and profitability framework. That's our goal and our main aim. That's why I would like to thank you all wholeheartedly as well as the Board of Directors of Endesa for their never-ending support. I would like to extend my appreciation to Miquel Roca and Alejandro Echevarría, especially, for those 12 years during which I have been able to learn from them. I would also like to thank the Chairman Juan Sánchez-Calero, Francesco Starace and the Enel Group for their trust and for their ongoing support. We are all part of a great group, a leading group that has a clear-cut and precise plan. At the Enel Group and at Endesa, we are proud of being able to contribute from our operation in Spain and Portugal to keep on building a better future that is more overarching, cleaner and sustainable. Thank you very much, and we shall keep on working. [Presentation]