State and Regional-Owned Enterprises 2023-2024

The Portuguese Public Finance Council (CFP) publishes this report on the State-Owned Enterprises and Regional-Owned Enterprises, which analyses the economic and financial situation of the respective companies in the period 2023-2024. The SOE and ROE were previously analysed in separate publications, but from this document onwards they will be addressed in an integrated manner, in a single report, according to harmonised methodological criteria.

The State-Owned Enterprises (SOE) strengthened its weight in the economy and in public employment, driven by the integration of 31 new health units. This growth translated into an increase in activity and added value, but overall results remained negative, reflecting structural weaknesses, especially in the health sector. Despite the improvement in financial indicators, largely sustained by the efforts of the shareholder, the existence of several companies in technical bankruptcy compromises economic and financial sustainability and increases the risk of additional pressure on public finances. The health sector significantly worsened its losses, continuing to show persistent structural deficits associated with chronic underfunding and high personnel costs. These factors indicate a high probability of continued negative results in the medium term, with a potential impact on financial sustainability and service quality. Transport and other non-financial sectors recorded improvements, benefiting from operational gains and the reversal of impairments. Financial companies performed very well, particularly Caixa Geral de Depósitos, which strengthened its profitability. The State's financial effort decreased, reflecting a lower need for financing, despite persistent structural challenges that require urgent measures to ensure efficiency and sustainability.

The Regional-Owned Enterprises (ROE) sector continued to show negative overall profitability, with its weight in the regional economy and employment declining. Despite increased economic activity, as evidenced by growth in turnover, the autonomous regions continued to show economic performance marked by losses and persistent negative equity in some companies, particularly in the health sector. In the Autonomous Region of the Azores (RAA), economic results worsened, mainly influenced by the negative performance of the transport sector, particularly the SATA Group. This context contributed to the deterioration of financial autonomy and solvency indicators, requiring increased financial efforts by the Regional Government. Azorean companies have limited borrowing capacity, evidenced by insufficient equity to support medium and long-term liabilities. High dependence on external capital accentuates financial leverage, increasing the risk for shareholders and creditors. In the Autonomous Region of Madeira (RAM), there was an improvement in economic results, which was reflected in the positive evolution of financial indicators, particularly in terms of autonomy and solvency, justifying a lower financial effort by the Regional Government.

State-Owned Enterprises

In 2024, the SOE expanded its relevance in the economy, intensifying its contribution to public employment. In the analysed universe, comprising 88 non-financial companies and groups of companies and 5 financial companies in the SOE, out of a total of 146 entities that make up the SOE, the State's shareholding amounted to 36.3 billion € (12.5% of GDP), 1.6 billion € more than in 2023. At the end of 2024, these companies employed 187,088 workers (+14.5% compared to 2023), representing 3.7% of national employment and 23.2% of public sector employment. This growth reflects the creation of 31 new ULS, which integrated professionals previously outside the State's business perimeter. The GVA of the SOE grew by 12.7%, representing 4.4% of GDP.

Weaknesses in the governance and transparency of the SOE persist, despite some progress in the disclosure of information. In terms of governance, only 70 Annual Reports and Financial Statements for 2024 (48% of the total) had been approved by the Supervisory Authority at the cut-off date of this report, highlighting persistent delays in meeting regulatory deadlines. This situation is also observed in other management instruments, which compromises the accountability and efficiency of the sector. Despite progress in disclosure, weaknesses remain in reporting mechanisms.

SOE companies continued to post negative overall results, despite an improvement in financial structure indicators. The turnover of non-financial companies reached 20.6 billion € (+5.2 billion € compared to 2023), but the aggregate net result was negative at 1,312 million €, deteriorating by 546 million € compared to the previous year. Equity increased to 18.9 billion €  (+2 billion €), supported by the shareholder's financial commitment, while liabilities grew slightly to 49.3 billion € (+176 million €). The financial autonomy (27.7%) and solvency (38.4%) ratios strengthened, but 35 companies were in a situation of technical bankruptcy.

The economic and financial situation of public companies in the health sector deteriorated significantly. The Public Business Entities (EPE) of the National Health Service (SNS) reported losses of 1.7 billion €, an increase of 769 million € compared to 2023. This development mainly reflects the additional costs of creating new Local Health Units (ULS) and insufficient funding. At the end of 2024, only one entity reported a positive result, with 30 of the 42 reporting negative equity.

The transport and storage sector, as well as the other non-financial sectors, showed an improvement in results in 2024. The transport and storage sector recorded an aggregate net result of 205 million € in 2024 (+58 million € compared to 2023). This performance benefited from the positive contributions of Infraestruturas de Portugal, which significantly strengthened its results, and TAP SA, which consolidated its holdings with Portugália and, despite a decrease in its results, continued to make a significant absolute contribution. In the other non-financial sectors, the aggregate net income was 221 million €, with Parvalorem standing out for having gone from a loss of 98 million € in 2023 to a profit of 16 million € in 2024, with the reversal of impairments and provisions resulting mainly from credit recovery.

The financial companies in the SOE significantly strengthened their profitability, with the performance of Caixa Geral de Depósitos (CGD) standing out. Overall, net income amounted to 1.8 billion €, 369 million € more than in 2023. CGD was responsible for almost all of this performance, with profits of 1.7 billion €, benefiting from a sharp reduction in provisions and impairments and growth in the loan portfolio, which offset the slight decline in net interest income.

The State's financial effort with the SOE decreased in 2024, reflecting lower financing requirements. The net financial effort decreased to 3.5 billion € (1.2% of GDP), 1.2 billion € less than in 2023. Total expenditure reached 4.2 billion €  (-1.3 billion € compared to 2023), mainly in capital appropriations, which amounted to 3.8 billion €. On the other hand, dividend income (net of CIT) decreased to 656 million €  (-145 million €), mainly due to the absence of distribution by Banco de Portugal, only partially offset by the increase in CGD dividends.

Investment by non-financial companies increased in 2024. The total amount reached 4.1 billion € (1.4% of GDP), 164 million € (+4.2%) more than in 2023. More than 80% of this amount was concentrated in six companies: TAP, Infraestruturas de Portugal, Metro do Porto, Águas de Portugal, ENSE and Construção Pública.

Regional-Owned Enterprises

The ROE's weight in the regional economy and employment decreased in 2024. In that year, the ROE consisted of 40 non-financial companies (of which 39 were analysed), accounting for more than a third of public employment in the Autonomous Regions, employing 16,400 workers: 7,600 in the Azores-Owned Enterprises (SERAA) and 8,800 in the Madeira-Owned Enterprises (SERAM). These figures correspond to 6.5% and 7.0% of regional employment, respectively, reflecting variations of -0.1 p.p. and -0.4 p.p. compared to 2023. The Regions' shareholding in SER remained at 1,334 million €. The GVA generated by SERAA represented 7.6% of the Azores' GDP (-0.6 p.p. of GDP compared to 2023), while the GVA generated by SERAM stabilised at 6.4% of Madeira's GDP.

The economic and financial performance in the SER Regions was different, but both recorded negative net results. In SERAA, the increase in relevant operating expenses, which exceeded the increase in turnover, led to a deterioration in the net result to 93.3 € million. This performance was accompanied by a reduction in the autonomy and solvency indicators, in a context of greater dependence on external capital and the fragility of the SATA group, whose unconsolidated net result fell significantly by 47.2 million €. SERAM saw a slight strengthening of its financial position, reflected in an improvement in its debt capacity, as well as better economic performance, despite still recording a net loss of 23.2 million €. Overall, SERAM's overall profitability remained negative, highlighting possible structural limitations and dependence on public funding. The profitability of sales and assets remained negative and the return on equity worsened in SERAA, while remaining positive in some sectors of SERAM.

The economic and financial results of the sectors of activity differ significantly from each other. In RAA, the transport and storage sector stands out, given its turnover, operating expenses and assets. Despite the gradual recovery of economic activity, operating expenses in this sector exceeded operating income, resulting in a deterioration in EBITDA, EBIT, net income and GVA, as well as in financial structure and profitability indicators. This development was due to the negative performance of SATA Internacional – Azores Airlines, a company currently undergoing privatisation. In SERAM, the health sector, represented exclusively by SESARAM, stands out due to the weight of the number of employees and the relevance of operating expenses, especially personnel, which significantly burden the cost structure. This company has negative equity, penalising solvency and financial autonomy ratios. Even so, SESARAM recorded an improvement in its net result - the result of growth in turnover exceeding that of relevant operating expenses - although this was still negative in 2024.

The net financial effort of the RAA with its respective SER increased in 2024, contrary to what happened in the RAM. The net financial effort of the RAA with the respective ROE increased by 18.4 million €, while that of the RAM decreased by 79.4 million €, totalling 93.5 million € and 77.2 million €, respectively, corresponding to 1.6% and 1.0% of the respective regional GDP. This net effort was mainly explained by capital transfers, as dividends totalled only 4.6 million € in the RAM and 3.5 million € in the RAA. Payments relating to investment activities increased by 58.4 million € to 610.9 million € in 2024.

Date of last update: 26/11/2025