UPDATE 1-Portugal's REN to expand network to accommodate new renewables projects

(Changes lead, adds new targets)

LISBON, May 14 (Reuters) - Portuguese power grid operator REN plans to boost its capex by 35% over the next five years to 900 million euros, expanding its electricity network to accommodate new renewable energy projects, Chief Executive Rodrigo Costa said on Friday.

REN, which owns high-voltage electricity and high-pressure natural gas transmission grids in Portugal, said it would spend 200 to 235 million euros per year on capital investments, up from an average of 175 million euros in the past five years.

“I’m very confident. Looking towards the energy transition future every country in the world is embracing, I can say we are ready,” Rodrigo Costa told analysts during a Capital Market’s Day conference.

Chief Operating Officer Joao Conceicao said that “the increase in capex to ensure the green transformation in Portugal will accommodate new hydro projects and other renewables, namely the recent solar push the country is witnessing.”

REN projects that the country’s installed renewable capacity, totalling 19 gigawatts (GW) in 2019, will rise to 25 GW by 2030.

The company expects a slight rise in its annual profit to between 110 and 115 million euros per year by 2024, compared to 109 million euros last year.

REN also revised its dividend policy, setting a floor of 0.154 euros per share, lower than the 0.171 euros it has been paying since 2018 - but said a “potential uplift may occur if there are material net income upsides”.

The company expects its earnings before taxes, depreciation and amortization (EBITDA) will remain in the range of 450 to 470 million euros annually in the 2021-24 cycle, compared to 470.2 million euros in 2020.

Earlier on Friday REN posted a 4% rise in net profit for the first three months of 2021 to 4.5 million euros ($5.45 million) on lower taxes and financial charges. ($1 = 0.8260 euros) (Reporting by Sergio Goncalves; Editing by Catarina Demony, Victoria Waldersee, Emelia Sithole-Matarise and David Evans)