Iren S.p.a. · MIL:IRE
Iren — IRIDE — H1 2009 Earnings Presentation
25 slides from Iren's earnings presentation, Aug 28, 2009
Slide 1: First Half Results 2009
First Half Results 2009 28 August 2009
Slide 2: 1H 2009 Results - Summary
1H 2009 RESULTS - SUMMARY 2 z Main Figures z Key Growth Drivers z Strategic Achievements z Capital Expenditures z Synergies z Gas and Electricity Market Scenario z EBITDA and EBIT Key Drivers z Electricity Generation z Market z Energy Networks z Water Services and Other Services z From EBITDA to Net
Slide 3: 1H 2009 Main Figures
1H 2009 MAIN FIGURES 3 1H09 1H09 1H08 1H08 ∆∆ ∆∆ % % Euro million Revenues Revenues 1,200 1,200 1,193 1,193 77 1% 1% EBITDA EBITDA 211 211 197 197 14 14 7% 7% EBIT EBIT 142 142 133 133 99 6% 6% Profit Profit Before Before Taxes Taxes 91 91 111 111 (19) (19) -18% -18% Group Group Net Net Profit Profi
Slide 4: 1H09 Key Drivers
1H09 KEY DRIVERS 4 EBITDA KEY DRIVERS ELECTRICITY GENERATED (GWh) 3,808 z In an unfavourable scenario, IRIDE free market energy activities posted +18% 193 an EBITDA increase of 24% (peak among its peers), backed by an 3,232 191 884 efficient asset portfolio and a stable customer base. Total producti
Slide 5: Main Strategic Achievements
MAIN STRATEGIC ACHIEVEMENTS 5 2009 MAIN ACHIEVEMENTS PROJECT DETAILS z Completion of authorisation process z Installed capacity: 400 MWe & 220 MWt TORINO z Start of construction works z Completion of works: October 2011 Nord z Capex reduced from € 320 mln to z Turin volumes heated after TO Nord: 56
Slide 6: OLT - Offshore LNG Toscana
OLT - Offshore LNG Toscana 6 z In May 2009 IRIDE Mercato, E.ON Ruhrgas and E.ON Europa entered into a MoU relating to OLT (46.79% E.On Europa and 46.79% IRIDE Group through IRIDE Mercato and ASA Livorno). z In the event the TPA exemption is granted by the Ministry of Economic Development (MSE), E.ON
Slide 7: Genoa ATO
Genoa ATO 7 z In August 2009 the Genoa ATO granted IRIDE Acqua Gas the concession to operate the water services in the Province of Genoa up to 2033. z This achievement will enable IRIDE to improve the water services in Genoa within a stable regulatory framework. z IRIDE will benefit from the remuner
Slide 8: Torino Nord
TORINO NORD 8 Torino Nord Plant z CHP plant and DH network fully authorised and plant under construction. Le Vallette Plant z Efficiency in CHP mode up to 85% z Energy savings: 100,000 PET/year z CO2 emissions avoided: 300,000 tonnes/year Poltecnico Plant TORINO NORD PLANT KEY FIGURES z Capex: € 280
Slide 9: 1H09 Capex
1H09 CAPEX 9 1H09 capital expenditures of € 120 mln Generation 17% z Valle Orco repowering z Bardonetto and Villa plants: at 100% of total works LNG Terminals z Rosone plant: at 40% of total works; 2 out of 4 units already 31% repowered; repowering to be completed in October 2010 Energy Networks z T
Slide 10: Synergies
SYNERGIES 10 z In line with the plan for targeted synergies, in 1H 2009 Synergies: € 10 mln terms of early retirement and internal reorganization, as well as external cost 24% O&M and other External cutting costs 13% 40% Insurance z Synergies achieved: over € 20 mln on annual basis Personnel 63% Pur
Slide 11: 1H 2009 EBITDA Breakdown
1H 2009 EBITDA BREAKDOWN 11 z Strong performance of electricity and heat production from own plants overcame the weak market scenario z Stable margins achieved in regulated activities, though they were affected by the change in distribution of revenues during the period for the gas networks and lowe
Slide 12: 1H 2009 Oil and Gas Scenario
1H 2009 OIL AND GAS SCENARIO 12 z In 1H09 Italian gas demand dropped by 13% for MONTHLY CHANGE IN ITALIAN GAS DEMAND industrial and thermoelectric consumptions, while 30.0% civil uses were steady 20.0% z Average Brent price was 53 $/bbl (-52%) and 40 10.0% €/bbl (-45%) 0.0% z High volatility of EUR/
Slide 13: 1H 2009 Electricity Scenario
1H 2009 ELECTRICITY SCENARIO 13 z In 1H09 Italian Electricity demand dropped by 8.2% MONTHLY CHANGE IN ITALIAN ELECTRICITY DEMAND 10,0% z Electricity production dropped by 11.9% driven by 5,0% thermoelectric production (-20.1%) and despite an increase in hydroelectric production (+34.6%) 0,0% z Aver
Slide 14: Generation of Electricity and Heat
GENERATION OF ELECTRICITY AND HEAT 14 1H09 vs 1H08 Additional production from Moncalieri GT2 Stable production from existing thermo plants during 1H09 1H08 Δ €MLN Δ% winter season Revenues 372 253 +119 47% Higher availability of hydro plants (Pont Ventoux and EBITDA 104 62 +42 68% Valle Orco) and hi
Slide 15: Market
MARKET 15 1H09 vs. 1H08 Demand reduction squeezed margins and volume of 1H09 1H08 Δ €MLN Δ% electricity produced by Edipower plants Revenues 1.219 1.180 +39 3% € 8 mln in profits due to energy derivatives recorded in EBITDA 20 38 (17) -46% 1H08 which were absorbed by year-end gas and heat 14 15 (2)
Slide 16: Energy Networks
ENERGY NETWORKS 16 1H09 vs. 1H08 Efficiencies enabled an increase in margins of 1H09 1H08 Δ €MLN Δ% electricity networks (+7%) despite lower volumes (-3%) Revenues 118 119 (1) -1% EBITDA 63 64 (1) -1% New accounting method for revenues affected Gas gas and DH 37 39 (2) -6% and DH networks by € 1 mln
Slide 17: Water Services and Other Services
WATER SERVICES AND OTHER SERVICES 17 WATER SERVICES 1H09 1H08 Δ €MLN Δ% Lower volumes sold by Mediterranea delle Acque (- Revenues 76 77 (1) -1% 3%), equal to a decrease of € -2.9 mln in revenues EBITDA 25 26 (2) -6% Such reduction has been partially compensated by EBIT 12 15 (3) -17% efficiencies a
Slide 18: From EBITDA to Net Profit
FROM EBITDA TO NET PROFIT 18 1H09 1H09 1H08 1H08 ∆∆ MLN MLN €€ ∆∆ % % EBITDA EBITDA 211 211 197 197 14 14 7% 7% • Increase in D&A for Moncalieri GT2 and Pont D&A D&A -- Accruals Accruals (69) (69) (64) (64) (5) (5) 8% 8% Ventoux • Increase in bad debt provision EBIT EBIT 142 142 133 133 99 6% 6% Fin
Slide 19: Net Profit and Extraordinary Tax Items
NET PROFIT AND EXTRAORDINARY TAX ITEMS 19 z Change in net profit has been affected by one-off tax items One-off tax effect (Mln €) 1H FY z € 37 €mln in costs for tax moratorium in 1H09 Deferred tax +21 +21 2008 z € 21 mln in profit for issue of deferred tax net of the substitute Moratorium -15 tax i
Slide 20: 1H09 Financials
1H09 FINANCIALS 20 DEVELOPMENT OF NET FINANCIAL DEBT (MLN €) z Average cost of debt: 3.25% (4.5% in 1H08) 1,505 1,378 1,293 1,293 z Floating Interest Rate Debt: 26% 1,314 1,221 1,219 1,093 z New financing in the first half: € 130 mln 2008 2009 e nd o f 3 1- M a r 3 0 - J un 30-Sep 3 1- D e c pre v Y
Slide 21: Annexes
Annexes
Slide 22: Reclassified Profit and Loss Account
RECLASSIFIED PROFIT AND LOSS ACCOUNT 22 2008 IRIDE GROUP - P&L 1H 09 1H 08 var % 2.482 Consolidated Revenue 1.200 1.193 0,6 (2.118) Operating costs (990) (996) (0,6) (1.980) -External expenseses (917) (925) (0,9) (138) -Personnel expense (72) (71) 2,5 364 EBITDA 211 197 6,9 (138) Depreciation, amort
Slide 23: Reclassified Balance Sheet
RECLASSIFIED BALANCE SHEET 23 1H 08 IRIDE GROUP - BS 1H 09 2008 var % 2,537 Non-current assets 2,754 2,692 2.3 12 Other non-current assets (liabilities) 12 14 (15.4) 408 Net working capital 361 232 56.0 (67) Deferred tax assets (liabilities) (55) (30) 82.1 (148) Provisions and benefits (162) (160) 1
Slide 24: Cash Flow Statement
CASH FLOW STATEMENT 24 IRIDE GROUP - CF 1H 09 1H 08 var % A. Opening cash and cash equivalents 72 27 (*) B. Cash flow from operating activities (8) (21) (60) -Profit/(loss) for the period/year 39 93 (58) - Total adjustments: amortisation, depreciation, net provisions and impairment losses 55 27 (*)
Slide 25: Disclaimer
Disclaimer 25 The Manager in charge of drawing up the corporate accounting documents and the Chief Financial Officer of IRIDE S.p.A., Mr. Massimo Levrino, hereby declares, pursuant to paragraph 2 of article 154 bis of the Consolidated Finance Act (Legislative Decree No 58/1998), that the accounting