Snam S.p.a. · MIL:SRG
Snam — Snam Rete Gas — Q3 2003 Earnings Presentation
21 slides from Snam's earnings presentation, Nov 11, 2003
Slide 1: Analyst Presentation Third Quarter 2003
Analyst Presentation Third Quarter 2003 November 11, 2003
Slide 2: Agenda
Agenda 3Q 2003 Financial Results Market Scenario Operating Activities Regulatory Framework Closing Remarks 2
Slide 3: 3Q 2003 Financial Results
3Q 2003 Financial Results 3
Slide 4: Highlights
Highlights Jan-Sept Jan- Jan- Jan-Sept 2003 Change % 2002 VOLUMES bcm 54.7 55.6 +0.9 +2% CAPEX €m 253 290 +37 +15% EBITDA €m 954 1,056 +102 +11% EBIT €m 616 711 +95 +15% NET PROFIT €m 339 372 +33 +10% CASH FLOW €m 535 360 -175 -33% 4
Slide 5: EBITDA Growth
EBITDA Growth €m Jan-Sept Jan- Jan- Jan-Sept Change 2002 2003 Revenues 1,326 1,315 -11 Regulated revenues 1,282 1,299 +17 of which pass through 69 59 -10 Non regulated revenues 44 16 -28 Operating expenses -372 -259 +113 EBITDA 954 1,056 +102 5
Slide 6: EBITDA Growth
EBITDA Growth €m 954 +102 1,056 -5 +65 Other +15 +27 Sicilian OPEX of tax regulated Regulated activities revenues Jan- Jan-Sept Jan- Jan-Sept 2002 2003 6
Slide 7: Income Statement
Income Statement €m Jan-Sept Jan- Jan- Jan-Sept 2003 Change 2002 REVENUES 1,326 1,315 -11 Regulated revenues 1,282 1,299 +17 Non regulated revenues 44 16 -28 Operating expenses -372 -259 +113 EBITDA 954 1,056 +102 Depreciation & Amortisation -338 -345 -7 EBIT 616 711 +95 Net interest income (expense
Slide 8: Balance Sheet
Balance Sheet €m 31Dec 30Sept 2002 2003 Net Invested Capital 9,007 -301 8,706 Fixed assets 9,288 -80 9,208 Tangible fixed assets 9,182 -67 9,115 Intangible fixed assets 106 -13 93 Net working capital -264 -219 -483 Receivables 424 -64 360 Liabilities -688 -155 -843 Staff-leaving indemnity -17 -2 -19
Slide 9: Capex
Capex €m Jan-Sept Jan- Jan- Jan-Sept 2003 Change % 2002 TOTAL 253 290 +37 +15% DEVELOPMENT 183 207 +24 +13% Transportation - national 129 144 +15 Transportation - regional 52 61 +9 LNG 2 2 - MAINTENANCE AND OTHER 70 83 +13 +19% 9
Slide 10: Cash Flow
Cash Flow €m Jan-Sept Jan- Jan- Jan-Sept Change 2002 2003 Net income 339 372 +33 Depreciation and other non-monetary items 337 346 +9 Change in net working capital 278 221 -57 Cash flow from operations 954 939 -15 Net investments -236 -266 -30 Free cash flow 718 673 -45 Dividends -183 -313 -130 Cash
Slide 11: Market Scenario
Market Scenario 11
Slide 12: Gas demand/supply in Italy
Gas demand/supply in Italy bcm 101-103 90-92 84 72,3 Other Thermoelectric Import Industrial Residential & Commercial Domestic Production 2002 2006 2010 2015 Estimated import 15 23÷25 33÷35 increase vs 2002 ASSUMPTIONS ON THERMOELECTRIC: § Electricity yearly demand growth: +2,2% § Additional CCGT: +1
Slide 13: CCGT Driving the Growth
CCGT Driving the Growth 26 GW authorized 14 GW under construction of which: x New CCGT and 3,42 GW in operation by 2003 repowering under w La Casella (Enel) 1,52 GW construction w Porto Corsini (Enel) 0,76 GW w Pietrafitta (Enel) 0,38 GW w Priolo (Enel) 0,76 GW 4,47 GW in operation by 2004 w Sermide
Slide 14: Anti-Blackout Law
Anti-Blackout Law Accelerate new CCGT plants construction Penalties on delay of authorized plants start up and construction Simplification of authorization process for new plants Favour the construction of new gas infrastructure assets National network is essential for national energy security Simpl
Slide 15: Operating Activities
Operating Activities 15
Slide 16: New Investment Plan
New Investment Plan 2003 ÷ 2006 CAPEX PLAN €2.4 bn 2004 ÷ 2008 NEW CAPEX PLAN €3.5 bn 2003-2006 plan On schedule + New Projects* 2003 2004 2005 2006 2007 2008 *mainly depending upon BG final investment decision 16
Slide 17: Operating Efficiency Achievements
Operating Efficiency OPERATING FIXED COSTS: MAIN SOURCE OF IMPROVEMENT: Achievements 2001 vs 2000: - 9% Headcount reduction 3115 3200 2002 vs 2001: - 8% 2973 3000 2800 2646 2600 2490 Expected Y.E. 2003: -7% 2400 Jul-01 Dec-01 Dec-02 Dec-03E Future efficiency Innovative Professional skills technologi
Slide 18: Regulatory Framework
Regulatory Framework 18
Slide 19: Regulatory Framework
Regulatory Framework Italian gas regulatory framework Clear Stable Fair Assumed as base for 3 years positive new regulation of experience for SRG electric transmission Approved SRG Tariffs Assets revaluation proposal Risk free rate in line with Approved SRG Network long term bond yield Code Price ca
Slide 20: Closing Remarks
Closing Remarks 20
Slide 21: Closing Remarks
Closing Remarks Attractive Consistent Growing Regulation Strategy Market Drivers for operating performance New Cost Capex Efficiency Strong Sustainable Capital Cash Flow Dividend Growth 21