9M19 Consolidated Results - Terna 9M2019... · 9m19 consolidated results november 13th 2019 this document has been prepared by terna s.p.a. (the “company”)for the sole purpose

1

9M19 CONSOLIDATED RESULTS NOVEMBER 13th 2019

November 13th 2019

9M19 Consolidated Results

2


Agenda

9M19 Results 6

Closing Remarks 16

Highlights 3

Annexes 17

3


Highlights

4


26.9

26.3 26.5

28.4

25.526.4

24.0

25.2

27.8

31.4

26.5 26.7

20

22

24

26

28

30

32

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep

Monthy energy demand

Previous Year

Demand Evolution – Last 12 months

DEMAND AS REPORTED (TWh)

Highlights (1/2)

Note: 2017 final figures, 2018 and 2019 preliminary figures

Increasing contribution from wind and PV production

9M19 data:

▪ National Demand at 242 TWh, o/w 36% covered by RES

▪ Net Total Production at 216 TWh

Wind increased by 14%

PV increased by 6%

YoY

Change

9M2019

Δ %

-0.1%

9M19 9M18

241.9 242.2

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep

2.1% -1.3% -1.5% 4.4% -2.2% -5.0% -0.6% -2.9% 2.9% 3.1% -0.2% -1.2%

5


Strong capex acceleration confirmed

9M 2019 Key Figures

1. 9M18 revenues reclassified in accordance with new IFRS. No impact at EBITDA level

2. Attributable to Terna

9M 2018€mn

Revenues

EBITDA

Group Net Income2

Capex

Δ vs 9M189M 2019

1,666 1,6051

1,278 1,230

553 542

670 561

Highlights (2/2)

+4%

+4%

+2%

+19%

8,250 7,899Net Debt

FY 20189M 2019

6


9M19 Results

7


1,605 1,666

1,481 1,518

118130

61737 12 11

9M18 ∆RegulatedActivities

∆Non Regulated

Activities

∆International

Activities

9M19

Revenues

Note: figures may not add up due to rounding

1. Including IFRIC12

2. Construction margin, including IFRIC12

Insourcing attività di O&M Rete FS Capex execution as a driver of our domestic growth

1 2

€mn +60

+3.8%

Regulated Activities1

Non Regulated Act.

International Act.2

9M 2019 results

8


118 130

6

17124 1211 148

9M18 ∆Non Regulated

Activities

∆International

Activities

9M19

1,451 1,480

17

28 10 -1

2712 11

1,481 1,518

9M18 ∆

Transmission &

Dispatching

∆

Other

∆

IFRIC12

9M19

Revenues Analysis

€mn

REGULATED€mn

NON REGULATED AND INTERNATIONAL

+37

+2.5% +23

+18.8%

Tamini’s turnaround ongoing

Transmission & Dispatching

OtherIFRIC 12


9M 2019 results

Non Regulated Act.

International Act.

9


375 387

288 285

81 94

68-3 13 2

9M18 ∆RegulatedActivities

∆Non Regulated

Activities

∆International

Activities

9M19

1

+12

+3.3%

€mn

Opex


1. Including IFRIC12

Insourcing attività di O&M Rete FS Efficiency program well on track

9M 2019 results

Regulated Activities1

Non Regulated Act.

International Act.

10


8194

6

132

887

103

9M18 ∆Non Regulated

Activities

∆International

Activities

9M19

156 160

120

4 -6 -1

114

12 11

288 285

9M18 ∆

Labour Costs

∆

External Costs

& Other

∆

IFRIC12

9M19

Opex Analysis

Insourcing attività di O&M Rete FS Skills insourcing as a driver of improved performance

€mn

REGULATED€mn


-3

-1.1%+15

+17.5%

Labour CostsExternal Costs & Other

IFRIC 12


9M 2019 results

Non Regulated Act.

International Act.

11


1,193 1,233

40

9M18 ∆ 9M19

1,230 1,278

9M18 9M19

EBITDA

Insourcing attività di O&M Rete FS Robust EBITDA improvement

€mn

TOTAL EBITDA€mn

REGULATED

€mn


+48

+3.9%


9M 2019 results

37 45

8

9M18 ∆ 9M19

12


1,278

842

553 542

436

61

227

EBITDA D&A EBIT NetFinancialExpenses

Taxes GroupNet Income

GroupNet Income

9M18

From EBITDA to Net Income

Note: figures may not add up due to rounding1. Attributable to Terna. Excluding 2.1 €mn of Minorities in 9M19 and 3.5 €mn in 9M18

Solid value creation for our shareholders

1

€mn

1

+2% YoY

9M 2019 results

13


595

7%

93%

Incentivized Investments (5.6% +1%) Other Regulated (5.6%)

68 40

434 554

59

75561670

9M18 9M19

Incentivized Investments Other Regulated Other

Capex

Insourcing attività di O&M Rete FS Strong Group’s commitment to serve Italian energy transition

TOTAL CAPEX€mn

21

REGULATED CAPEX


1. I-NPR1+O-NPR1 in line with ARERA Resolution n. 579/17

2. Of which about 9 €mn of Capitalized Financial Charges in 9M19 and 12 €mn in 9M18

9M 2019 results

595

€mn

14


7,8998,250

886

85

670

481

Dec.31,2018

OperatingCash Flow

Δ WC & Other Capex Dividends&

Equity

Sep.30,2019

Note: figures may not add up due to rounding1. Including Other Fixed Assets Changes2. Including Cash Flow Hedge reserve and other

Cash Flow & Net Debt Evolution

Solid operating cash flow generation

€mn

2

Free Cash Flow to Equity +131

+350

1

9M 2019 results

15


81%

17%2%

Terna SpA Bonds

EIB

Banks

Net Debt Evolution & Financial Structure

1. Percentages and key ratios calculated on Gross Debt nominal value2. IAS value

Resilient financial structure

GROSS DEBT BREAKDOWN KEY RATIOS1 1

Fixed/Floating Ratio

Calculated on Gross Debt

82% Fixed

Duration

4.9 years

10.6€bn 2

9M 2019 results

16


Closing Remarks

Strong capex acceleration confirmed

Robust EBITDA improvement

Capex execution as a driver of our domestic growth

Plan execution well on track

Solid value creation for our shareholders

17


Annexes

18


€ mn 9M19 9M18 Δmn Δ%

Total Revenue 1,666 1,605 60 3.8%

Regulated Activities 1,518 1,481 37 2.5%

Transmission 1,395 1,348 47 3.4%

Dispatching 85 103 -18 -17.7%

Other 27 17 10 57.5%

IFRIC12 11 12 -1 -9.2%

Non Regulated Activities 130 118 12 10.3%

International Activities 17 6 11 185.0%

Total Costs 387 375 12 3.3%

Regulated Activities 285 288 -3 -1.1%

Labour Costs 160 156 4 2.7%

External Costs 103 106 -2 -2.1%

Other 10 14 -4 -28.0%

IFRIC12 11 12 -1 -9.2%

Non Regulated Activities 94 81 13 16.1%

International Activities 8 6 2 36.7%

EBITDA 1,278 1,230 48 3.9%

D&A 436 400 36 9.0%

EBIT 842 830 12 1.5%

Net Financial Charges 61 67 -6 -8.5%

Pre Tax Profit 781 763 18 2.3%

Taxes 227 218 8 3.8%

Tax Rate (%) 29.0% 28.6% +0.4 pp

Total Net Income 555 545 10 1.8%

Minority Interest 2 4 -1 -40.0%

Group Net Income 553 542 11 2.0%

1. Managerial Accounting2. 9M18 reclassified in accordance with new IFRS. No impact at EBITDA level3. Including Quality of Service

Consolidated Income Statement1

Annex

3

3

2

19


Consolidated Balance Sheet

Annex

€ mn

PP&E

Intangible Asset

Financial Inv. and Other

Total Fixed Assets

Net WC

Funds

Net Capital Invested

Financed by:

Consolidated Net Debt

Total Shareholder's Equity

Total

D/E Ratio

D/D+E Ratio

Number of Shares (mn)

Sep. 30,2019 Dec. 31,2018 Δmn

13,457 13,244 212

521 519 2

345 320 25

14,323 14,084 239

-1,739 -1,823 83

-206 -308 101

12,377 11,954 423

8,250 7,899 350

4,127 4,054 73

12,377 11,954 423

2.0 1.9

0.7 0.7

2,010 2,010

20


€ mn 9M19 9M18

Total Net Income 555 545

D&A 433 397

Net Change in Funds -101 -38

Operating Cash Flow 886 904

Δ Working Capital & Other -85 169

Cash Flow from Operating Activities 801 1,073

Capital Expenditures -670 -561

Free Cash Flow to Equity 131 512

Dividends & Equity -481 -307

Change in Net Cash (Debt) -350 205

1. Net of assets’ disposal

2. Including Other Fixed Assets Changes3. Including Cash Flow Hedge accruals and other

Consolidated Cash Flow

Annex

1

2

3

21


€ mn 9M19 9M18 Δ mn Δ%

Incentivized Investment 40 68 -27 -40%

Other Reguleted 554 434 120 28%

Regulated Capex 595 502 93 18%

Other 75 59 16 27%

Total Group Capex 670 561 109 19%

Capex

Annex

1. I-NPR1+O-NPR1 in line with ARERA Resolution n. 579/17

2. Of which about 9 €mn of Capitalized Financial Charges in 9M19 and 12 €mn in 9M18

1

2

22


THIS DOCUMENT HAS BEEN PREPARED BY TERNA S.P.A. (THE “COMPANY”) FOR THE SOLE PURPOSE DESCRIBED HEREIN. IN NO CASE MAY IT BE INTERPRETED AS AN

OFFER OR INVITATION TO SELL OR PURCHASE ANY SECURITY ISSUED BY THE COMPANY OR ITS SUBSIDIARIES.

THE CONTENT OF THIS DOCUMENT HAS A MERELY INFORMATIVE AND PROVISIONAL NATURE AND THE STATEMENTS CONTAINED HEREIN HAVE NOT BEEN

INDEPENDENTLY VERIFIED. NEITHER THE COMPANY NOR ANY OF ITS REPRESENTATIVES SHALL ACCEPT ANY LIABILITY WHATSOEVER (WHETHER IN NEGLIGENCE OR

OTHERWISE) ARISING IN ANY WAY FROM THE USE OF THIS DOCUMENT OR ITS CONTENTS OR OTHERWISE ARISING IN CONNECTION WITH THIS DOCUMENT OR ANY

MATERIAL DISCUSSED DURING THE PRESENTATION.

THIS DOCUMENT MAY NOT BE REPRODUCED OR REDISTRIBUTED, IN WHOLE OR IN PART, TO ANY OTHER PERSON. THE INFORMATION CONTAINED HEREIN AND OTHER

MATERIAL DISCUSSED AT THE CONFERENCE CALL MAY INCLUDE FORWARD-LOOKING STATEMENTS THAT ARE NOT HISTORICAL FACTS, INCLUDING STATEMENTS

ABOUT THE COMPANY’S BELIEFS AND EXPECTATIONS. THESE STATEMENTS ARE BASED ON CURRENT PLANS, ESTIMATES, PROJECTIONS AND PROJECTS, AND

CANNOT BE INTERPRETED AS A PROMISE OR GUARANTEE OF WHATSOEVER NATURE.

HOWEVER, FORWARD-LOOKING STATEMENTS INVOLVE INHERENT RISKS AND UNCERTAINTIES AND ARE CURRENT ONLY AT THE DATE THEY ARE MADE. WE CAUTION

YOU THAT A NUMBER OF FACTORS COULD CAUSE THE COMPANY’S ACTUAL RESULTS AND PROVISIONS TO DIFFER MATERIALLY FROM THOSE CONTAINED IN ANY

FORWARD-LOOKING STATEMENT. SUCH FACTORS INCLUDE BUT ARE NOT LIMITED TO: TRENDS IN COMPANY’S BUSINESS, ITS ABILITY TO IMPLEMENT COST-CUTTING

PLANS, CHANGES IN THE REGULATORY ENVIRONMENT, DIFFERENT INTERPRETATION OF THE LAW AND REGULATION, ITS ABILITY TO SUCCESSFULLY DIVERSIFY AND

THE EXPECTED LEVEL OF FUTURE CAPITAL EXPENDITURES. THEREFORE, YOU SHOULD NOT PLACE UNDUE RELIANCE ON SUCH FORWARD-LOOKING STATEMENTS.

TERNA DOES NOT UNDERTAKE ANY OBLIGATION TO UPDATE FORWARD-LOOKING STATEMENTS TO REFLECT ANY CHANGES IN TERNA’S EXPECTATIONS WITH

REGARD THERETO OR ANY CHANGES IN EVENTS.

EXECUTIVE IN CHARGE OF THE PREPARATION OF ACCOUNTING DOCUMENTS “AGOSTINO SCORNAJENCHI” DECLARES, PURSUANT TO PARAGRAPH 2 OF ARTICLE 154-

BIS OF THE CONSOLIDATED LAW ON FINANCE, THAT THE ACCOUNTING INFORMATION CONTAINED IN THIS PRESENTATION, FOR WHAT CONCERNS THE ACTUAL

FIGURES, CORRESPONDS TO THE DOCUMENT RESULTS, BOOKS AND ACCOUNTING RECORDS.

Disclaimer

23


Notes

24


[email protected] I +39 06 8313 8282 I www.terna.it

9M19 Consolidated Results - Terna 9M2019... · 9m19 consolidated results november 13th 2019 this document has been prepared by terna s.p.a. (the “company”)for the sole purpose

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