Under review Acea Group Business Plan 2019-2022 May 2020
ACEA Group Agenda ACEA TODAY: Challenges of today and tomorrow BUSINESS PLAN 2019-2022 STRATEGY AND TARGETS BUSINESS LINE HIGHLIGHTS STRATEGIC OPPORTUNITIES CLOSING REMARKS ANNEX 2 MIL 190401 - Piano Industriale 201 ...
Acea Today ACEA Group Leader in the multi-utility market 2019 EBITDA Commercial & Water Trading €1,042M 1 ° Italian With 9 Among With more EBITDA 2019 player millions the main than 6 TWh in the water customers national players of electricity sold supply sector served in Lazio, in the energy Tuscany, Umbria market 81% regulated and Campania Shareholder structure Energy Caltagirone Infrastructure Environment 5.0% Market Among the with 10 Leading with more 20.7% Roma leading player in the TWh than 1.2 Capitale Italian waste Italian players in 51% distributed milion tons treatment sector the electricity electricity Suez waste distribution 23.3% treated/disposed market Source: CONSOB May 2020 3 MIL 190401 - Piano Industriale 201 ...
ACEA Group Strategy and Targets Pillars of the Business Plan 2018- 22 … Business Plan 2018-2022 Technology, Industrial Local focus & Operational Innovation and Growth Sustainability Efficiency Quality • Infrastructural • Sustainable • Research & • Capex discipline development development innovation applied • Operational to industrial improvement • Client-oriented • Dialogue and processes and service-based collaboration • S upply chain • Customer approach optimization experience • Balanced improvement organizational model • Group-wide innovation strategy 4 MIL 190401 - Piano Industriale 201 ...
Strategy and Targets - Strong and sustainable growth ACEA Group 2018 2020 2022 pre-tax 2020 GUIDANCE ROIC 11.0% >10% >11% 2020 EBITDA +6%/+8% 2019 EBITDA € 1,042M CAPEX broadly in line with 2019 and the Business Plan NET DEBT: € 3.45B – € 3.55B EBITDA growth with +8.0% CAGR NFP/EBITDA down to 2.9X 3.0 €M 2.9 2.9 3.1 Multiple 2.8 1,270 2.9 2.8 1,083 1,042 1,108 933 1,002 972 864 New BP Old BP 2019 2018 2019 2020 2022 2018 2019 2020 2022 271 284 283 362 Net 2.6 3.1 3.2 3.7 NFP Income €B 230 282 332 2.7 3.0 3.2 CAPEX €4.0B RAB up ~30% by 2022 RAB 2019 CAPEX old plan €3.1B Gori ATO2, ATO5 and Areti Areti ATO2 ATO5 GORI ADF ATO2, ATO5 e Areti (Old Plan) €B €B €B 2.2 2.0 0.2 0.2 0.2 1.4 * Areti Water 2019 * 2019 capex actual € 0.793B 5 MIL 190401 - Piano Industriale 201 ...
ACEA Group Strategy and Targets Outperformed previous business plan EBITDA targets CAGR 8.0% CAGR 7.7% CAGR 8.3% €M Cross-business line actions Performance improvement and cost efficiency + Generational turnover + Strengthening operations Comm. & Trading Water Energy Infrastr. Environment • • • • Tariff increase due to Tariff increase due to Commercial Boost Expansion of existing investments investments in plants • Cost-to-serve (Peschiera / Marcio) Resilience • reduction Development of new • • Gori consolidation Penalties cancellation for plants and M&A • Delay of Maggior network losses • • Pescara Gas Tutela phase-out CIP6 incentive end • PV development 6 MIL 190401 - Piano Industriale 201 ...
ACEA Group Strategy and Targets Additional €900M investments Cumulative 2018-2022 Highlights €B €M (approx.) Gori consolidation and +250 additional investments ( Peschiera/Marcio ) * +200 PV growth with M&A and greenfield developments Innovation , Resiliency +250 and modernization related investments Regolato Regolato M&A Waste acceleration +100 in a circular economy perspective *of which €0.5B innovation and industry 4.0 (smart meter, network districtization, automated secondary cabins, etc.) 7 MIL 190401 - Piano Industriale 201 ...
ACEA Group Strategy and Targets Sustainability growth Additional €400M sustainability- CO 2 Reduction >200 linked capex bring our Sustainability (Reduced losses, Purchase of kton effort to €1.7B overall Green Energy, Biogas Recovery) Recovering materials and energy in +70% a Circular Economy perspective +€100M +€200M +€100M Peschiera & PV Development / Marcio development M&A circular economy 500 Green Energy United Nations GWh for internal use within the Group Sustainable Development Goals (SDGs) Power Grid Risk index reduction -10% due to resiliency increase Safety inspections of maintenance +50% contractors 8 MIL 190401 - Piano Industriale 201 ...
ACEA Group Strategy and Targets Growing dividends vs previous business plan €800M of dividends €0.75 minimum Growing dividends vs old throughout the plan, dividend per share from +€100M vs old business plan 2019* business plan Dividend per share 0.78 €/share * The Board of Directors will propose at the Annual General Meeting a dividend per share of 0.78 euro. 9 MIL 190401 - Piano Industriale 201 ...
ACEA Group Strategy and Targets 16 May 2019 - Placing of Euro 500 million bond under Financial strategy the EMTN Programm, 9 years, fixed rate 1.75%. July 2019 – EMTN programme ceiling increased to €4bn 29 January 2020 - Placing of Euro 500 million bond under the EMTN Programm, 9 years, fixed rate 0.50%. Net Financial Position Highlights €B NFP/EBITDA Improved working Working Capital capital absorption (~€30M/year) Rating BBB+ Baa2 2.8x 3.0x 2.9x Stable outlook Stable outlook 2.8x Debt • Situation at 31 March 2020 NFP • Average maturity 6.16 yrs • Average cost of debt 1.93% 10 MIL 190401 - Piano Industriale 201 ...
Water Business Line Highlights
ACEA Group Water Business Line Key Actions 500k+ smart water meter and projects for water network districtization Focus on preservation of water , with development of a dedicated structure Development Rationalization of 35+ small purification facilities of a Smart 90% investments on Technical Quality Water Supply securitization, by doubling Peschiera (100M€ already included in 2019 - ’22 Plan) Company for a Gori full consolidation (1.4M clients served) sustainable Acquisition of Pescara Gas (62k PDR) to usage of water, enter in gas distribution business Procedure completed for renewal of concession for improving the Peschiera-Le Capore water main, due to expire in September 2031 (July 2019) service quality Acquedotto del Fiora full consolidation (over 402K clients served) and efficiency Agreement signed for the acquisition of 51% stake in the company Alto Sangro Distribuzione Gas (34k PDR; March 2020) 12 MIL 190401 - Piano Industriale 201 ...
ACEA Group Water Business Line Key Financials CAGR 8.0% €M CAGR 10.1% CAGR 5.9% EBITDA Pescara Gas Including Gori on a yearly basis (+45M€) Old Plan ATO2, ATO5, Gori €B €B INVESTMENTS RAB 13 MIL 190401 - Piano Industriale 201 ...
Business Line Highlights
ACEA Group Energy Infrastructure Key Actions 600k smart meters roll-out start 100+ M€ for Resiliency for electricity supply Main actor of the continuity vs Authority guidelines energy transition 150MW PV between grid parity and M&A on the secondary market with projects Remote control extension on 60% of the LV/MV enabling the secondary stations decarbonization Installation of over 600km of optical fiber at the of the system service of the existing infrastructure Renovation/expansion activities on the LV/MV network for over 2,500km Agreements for the acquisition of photovoltaic plants with total capacity of approximately 29 MWp 15 MIL 190401 - Piano Industriale 201 ...
ACEA Group Energy Infrastructure Key Financials CAGR 5.1% €M CAGR 6.3% CAGR 3.9% EBITDA Old Plan Distribution €B €B Metering INVESTMENTS RAB 16 MIL 190401 - Piano Industriale 201 ...
Commercial and Trading Business Line Highlights
ACEA Group Commercial and Trading Key Initiatives Strong commercial boost (3x vs. 2018) supported by a new offering model Growth of retail Increase of share of pull commercial channels (e.g. portfolio, Shop, Branch and Digital) up to 50% improvement of Strengthening of digital channels (10% on total acquisitions) service quality Operational excellence on key processes and reduction of 20% on CtS and 15% on CtC and exploitation of energy Launch of new Value Added Services (e.g. smart meters, insurance, thermal systems) transition Entrance in the flexibility market (Terna auction opportunity for UVAM assigned to Tor di Valle plant for 10 MW) Signed with ERG two Power Purchase Agreements (PPA) concerning the supply of renewable energy totalling 1.5 TWh during the period 2020-2022 (October 2019) 18 MIL 190401 - Piano Industriale 201 ...
ACEA Group Commercial and Trading Key Financials CAGR 19.3% €M CAGR 8.2% CAGR 31.4% EBITDA Old Plan Power Mkt | Maggior Tutela CUSTOMER BASE €M Millions Power Mkt | Free INVESTMENTS Gas *Investments include Commissioning Capitalizations IFRS15 19 MIL 190401 - Piano Industriale 201 ...
Environment Business Line Highlights
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