State-Owned Enterprises 2022-2023

State-Owned Enterprises

This report analyses 86 non-financial and 6 financial State-Owned Enterprises (SOE), out of a total of 147 entities that make up the SOE sector.  The shareholder role exercised by the state, directly or indirectly through subsidiary companies, covered a total share capital of 34.8 billion € (13.0% of national GDP) in this group of entities, which translated into a decrease of 0.4 billion € compared to 2022. At the end of 2023, the group of SOE entities under analysis employed 160,605 workers (+0.8% compared to 2022), which represented 3.2% of national employment and 20.1% of public employment, according to the DGAEP classification. The year 2023 was marked by a continued recovery in economic activity, reflecting a 23.5% growth in the SOE's gross value added (GVA), representing approximately 4.6% of the national GDP in 2023.

Governance Model

Of the 147 Annual Reports relating to the SOE in 2023, only 75 (52%) had been approved by the Ministry at the time of this analysis, showing that a significant proportion are not approved in a timely manner. This reality extends to all management instruments, a delay that continues to jeopardise the efficiency of public management and limits the accountability cycle.

Despite improvements in the provision of information on the SOE and the disclosure of the state's relationship with this sector in the General State Account (GSA), significant limitations persist. In its opinion on the 2023 General State Account, the Court of Auditors highlighted once again weaknesses in the reporting of information on the SOE, especially regarding financial flows with other public companies and central government entities. In addition, the CFP notes that there is still no centralised and timely provision and disclosure of information on SOE companies. The information currently available remains limited, which reinforces the need to create a single, centralised source that gathers up-to-date data on all entities owned directly or indirectly by the state, ensuring full public access. In addition, management contracts between public company administrations and the state are still not disclosed, thus jeopardizing  transparency and accountability in the sector.

Economic and financial performance 

In 2023, the SOE showed a recovery in most economic and financial indicators. The aggregate turnover of non-financial companies in the SOE totalled 15.2 billion €, increasing by 1.7 billion € compared to 2022.

Although non-financial companies in the SOE have benefited from economic activity growth, their economic results continue to show imbalances with an aggregate net loss of 790 M€ in 2023. This result reflects an improvement by 348 million € compared to 2022, but it remains insufficient to correct the sector's economic imbalance. The number of employees involved in the operational activity of these companies increased by 1,452 individuals (+1%) compared to 2022. This growth was driven by the increase in health professionals (+729) and the increase in the number of workers at TAP, SA (+524).

The equity of non-financial companies in the SOE increased by 8.2 billion € in 2023, totalling 16.9 billion €. This growth essentially reflects the recovery of retained earnings, driven by the improved results of several companies in 2022. However, there is still a systematic need for capital injections, despite the decrease in the subscribed capital of this group of companies in 2023. The total liabilities of these entities fell by 6.5 billion € to 48.9 billion € in 2023, while assets grew by 1.7 billion € to 65.8 billion €. Compared to 2022, there was a significant improvement in the financial autonomy and solvency indicators, which reached 25.6% (+12.2 p.p.) and 34.5% (+18.9 p.p.), respectively. This development strengthened debt capacity (+36.1 p.p.) and the ability to fulfil commitments. However, despite this growth, in 2023, 29 companies (30 in 2022) were still technically bankrupt, with negative equity.

The economic results of the corporate public entities (EPE) integrated in the NHS improved in 2023, due to the increase in turnover. Following the return to normal care activities post-COVID-19 pandemic, most of the analysed entities saw an increase in the value of the capitation of programme contracts , which contributed to the strengthening of their income. This improvement resulted in a recovery in aggregate net income to -993.9 million € (+281.2 million € compared to 2022). Despite this recovery, only one NHS EPE had a positive net profit in 2023. The operating performance of this group of EPEs improved by 1.5%, as a result of a sharper growth in turnover (+10.4%) compared to the increase in relevant operating expenses (8.3%). In addition, there was an improvement in profitability ratios (sales, assets and equity), although remaining negative. There was also an improvement in the financial autonomy, solvency and indebtedness ratios. However, it is important to emphasise that, at the end of 2023, 24 of the 42 NHS public health organisations still had negative equity. 

In 2023, the transport sector saw a consolidation in turnover (+16.5%), which had a positive impact on the net results of this group of companies and made it possible to maintain the profitability of their assets. It should be noted that this recovery was most significant at TAP, SA, due to increased demand in the air transport sector, making it the main contributor to this sector's results. The aggregate net profit was 144 million €, representing a recovery of 24.7 million € compared to 2022.

The companies in the other sectors, which cover a range of activities from water collection to real estate, including TAP SGPS, recorded a reduction of 58.6 million € in their economic results, with EBITDA standing at 631 million €. This evolution was influenced by the increase in operating costs proportionally higher than the growth in turnover, which also led to a deterioration in the operating performance ratio.

Finally, the state-owned financial companies sector achieved a positive net profit of 1.4 billion €, representing an increase of 571 million € compared to 2022. The Caixa Geral de Depósitos Group, the largest in the SOE, remained the main driver of this positive performance, benefiting from the rise in interest rates and the consequent improvement in its net interest income.

Financial relationship between the State and the State-Owned Enterprises sector

The State's net financial effort totalled 4.7 billion € (up 31.8% on 2022) in 2023, representing 1.8% of GDP. Dividend income grew 187 million € due to the increased distribution by Caixa Geral de Depósitos. In turn, state expenditure on the SOE grew by 1.7 billion €, due to the 2 billion € increase in ‘capital appropriations and other financial assets’.

In 2023, non-financial companies in the SOE increased their investment spending by 452 million € (13.1%) reaching a total of 3.9 billion euros (1.5% of GDP). Six companies accounted for 82% of this amount (TAP, SA, Infraestruturas de Portugal, Metro do Porto, Águas de Portugal, ENSE - Entidade Nacional para o Sector Energético and Metropolitano de Lisboa), while 8% was invested by EPEs that are part of the NHS.

The state's contingent liabilities relating to the SOE were mainly linked to state-issued guarantees. Active guarantees totalled 4.6 billion € (1.7% of GDP), with one-fifth pertaining to companies recorded outside the general government (GG) sector. The indebtedness of entities not included in the GG sector totalled 3.1 billion € (1.2% of GDP), down from  3.6 billion € in 2022 (1.5% of GDP).

Date of last update: 27/11/2024