We have helped with everything we do; we are helping our customers to become more sustainable. But that doesn’t stop us ourselves from becoming more sustainable. And we strive to continue this year-by-year and I would, however, without going now into all targets, like to emphasize one target, especially safety. For us, it’s of an absolute importance that every employee returns home safely and healthy every day. And we are operating grids and infrastructure, which is a potentially dangerous environment. And therefore, this is an absolute focus, and we have been able to reduce our KPIs in the health and safety area year-over-year to a significant amount, but we are never satisfied in that area because every single severe accident, which we have is one too many.
Therefore, the emphasis, which we’re putting in health and safety, we are also putting diligently on all kinds of other targets. In total, you should take note of the fact that we are now including the CDP A- — A-list, which really makes us a champion, and they are looking at all the parameters. So we are really moving towards becoming more sustainable year-over-year. And we have also a Prime Status B- by ISS ESG and a low-risk profile according to Sustainability. So all the rating agencies are basically giving us scores, which are slowly hard to even improve going forward. So let me conclude. We deliver on the financial targets. We deliver on sustainability. We deliver on digitization, and we are uniquely positioned to capture unprecedented growth opportunities.
We will focus on value creation and on an investment plan that is based on sound financials, and we again commit to annually increase our dividend share — dividend per share by up to 5% year-over-year. And now Marc will guide you through the updated financial framework, which is building on that and how we translate our strategy into an attractive financial reward for all our shareholders. And with that, over to you, Marc.
Marc Spieker: Leo, thank you very much. And welcome from my side to everyone. When it comes to the changes in the management board, its announcement day, not a farewell. It’s why I directly cut through to my main messages. First, we significantly over delivered in 2023 on our earnings targets as you just heard from Leo. The magnitude of the beat certainly is extraordinary. The fact that we outperformed should nevertheless not come as a surprise to you. We deliver what we promise, and we always strive to achieve more, which brings me to my second message. We have successfully demonstrated in 2023, we can manage an investment momentum, leading to an increase in our annual organic CapEx run rate by close to 35%. This is an important muscle that we will continue to use big time.
We increased our midterm investment guidance by close to 30% to €42 billion by 2028. More importantly, when we do this, we have a clear focus on value creation, which brings me to my third message. Our operational strength is backed by a strong balance sheet. Our accelerated investment program is fully financed by our operational cash flows and a controlled buildup of financial debt. We can comfortably ensure a strong BBB/Baa rating. Even with the full execution of our growth plan, we see an additional €5 billion to €10 billion balance sheet capacity by 2028. Fourth and final asset, our ambitious midterm plan will provide a highly attractive total shareholder return. We will deliver high single-digit underlying earnings growth. In addition, our shareholders will continue to benefit from our super reliable dividend growth commitment by up to 5% annually, as Leo just said.
Let’s zoom in on our 2023 operational performance. Our adjusted EBITDA came in at €9.4 billion. This is roughly €1.5 billion above our initial guidance midpoint for the full year 2023. In our Energy Networks business, the increased underlying EBITDA of €6 billion came from CapEx-driven RAB expansion essentially in all countries. On top, we saw temporary upside from lower-than-expected so-called redispatch costs in Germany. And as you know, these timing effects are all economically neutral over the years. Outside Germany, we also observed additional temporary upside from a continued recovery of network losses. In our Customer Solutions business, we achieved an adjusted EBITDA growth of around €1.1 billion, which was driven by recurring and nonrecurring elements.
When it comes to the recurring effects, we observed the normalization of our B2C retail margins, due to an improved market environment and our fast adaptation to a more volatile commodity price environment. We are now comfortable that an underlying earnings level of €1.6 billion to €1.8 billion will be a new base to grow off. And let me be clear, this new norm also applies in today’s — vary today’s commodity price environment. Our Energy Infrastructure Solutions business is fully on track with its underlying 10% EBITDA growth trajectory. In 2023, this growth was partially disguised by adverse FX effects and an exceptionally strong financial year in 2022, containing partially positive one-off effects from asset optimization in the high price environment.
Let’s move on to the adjusted net income, which came in at €3.1 billion, roughly €0.7 billion above our initial guidance midpoint for the full year. The growth is essentially driven by the positive EBITDA development because earnings with a nonrecurring character mainly occurred in entities with major noncontrolling interests, minorities have been exceptionally high. This effect will fully normalize already in 2024. Let me now turn to our strong balance sheet. Our debt factor at year-end sits comfortably at 4x. This builds the solid foundation for the acceleration of our green growth plan. The quality of our earnings will remain high. Our cash conversion rate for the medium-term plan will stay at the well-known 100%. Cash conversion came in at the — in 2023 at the expected 80% belong 100% norm.
And you’re all aware of that this builds on the very strong 150% cash conversion back in 2022. So an expected normalization, which will bring us back to the earnings quality, which you are used to from us. Our provisions were driven by the strong decline in interest rates in Q4. Our pension discount rates dropped by around 100 basis points in the fourth quarter alone. The environment led to an increase in our pension liability and to an increase in the accounting value of the asset retirement obligation. If you look at current rates, you will observe that this effect has already partially reserved as I’m speaking. All in all, this means that we have an exceptionally strong balance sheet, which provides a solid foundation for our future growth plans, which brings me to our CapEx plan.
As Leo already said, we are facing a unique investment opportunity. The lion’s share of our CapEx upgrade will be invested in our Energy Networks business. 90% of this is RAB effective. We target to increase our annual CapEx run rate by a further 20% each year until 2025. This will translate into a sustainable CAGR of our power regulated asset base of 10% annually. Our networks investments have a clear regional focus and follow largely the same underlying trends across markets. As a significant part of our investments are directed at German regulated networks, I would like to zoom in for a brief moment on the value creation in Germany. In the German regulatory system, we create value through allowed capital returns on our investments and through becoming more efficient relative to our benchmark cost base.
Our ambition is clear. We want to achieve 150 to 200 basis points value spread on our total cost of capital across our entire networks business. In our German business, by far, the largest market will live up to this as well. This has made very transparent for you if you look at the composition of our EBITDA. Our step-up in investment volume presented today is well tailored to the total effective returns that we can and will earn. For an even further step up of our investments, we would need to see additional improvements in the regulatory environment. In this context, we highly appreciate that the German regulator has started an open and transparent consultation process on how to make the German regulatory regime fit for what is and will be needed in the future.
In parallel, we continue to take legal actions where regulatory parameters are not in sync with market standards. This continues to be the case for the market risk premium for the current regulatory period. If this was to improve to international market standards, it could justify further investments beyond our currently communicated envelope. Next to Energy Networks, we continue to gradually increase our investments in the Energy Infrastructure Solutions business. We see growing demand from our industrial and commercial customers for decarbonized energy and heating solutions. We have not yet factored in the significant potential from the municipal heating transition, which is gaining more and more momentum across Europe. And in Energy Retail, we continue to focus our investment activities on strengthening our digital sales and service platforms against the digitization strategy that Leo laid out.
