Italgas Board of Directors approves the renewal of the EMTN programme and the issuance of bonds

Milan, 23 October 2017 – Italgas’ Board of Directors, chaired by Lorenzo Bini Smaghi, met today and approved the renewal of the EMTN Programme launched in 2016 and raised the Programme maximum amount up to 3,500 million euro.

The Board of Directors has also approved the issue, by 31 October 2018, of one or more bonds to be placed with institutional investors. The total amount of the bonds issued may not in any case exceed the abovementioned maximum amount. The newly bonds issued may be listed on one or more regulated markets.

As of today, 2,650 million euro of bonds have been issued under the EMTN Programme.

The EMTN Programme is an effective tool to secure funding on the bond market in order to support Italgas growth diversifying funding sources at competitive costs

Italgas: approved the consolidated results for the first nine months of 2017

Milan, 23 October 2017 – Italgas’s Board of Directors met today under the chairmanship of Lorenzo Bini Smaghi, and approved the consolidated results for the first nine months and third quarter of 2017*.

Summary

Italgas confirms the growth objectives presented to the market, particularly with regards to the increase of 14.7% in EBIT and of 27.8% in net profit. The Group has continued with the implementation of the investment plan, which amounted to €346.5 million as at 30 September 2017 (+39.8% compared with the same period in 2016), and has confirmed the objective of a total of more than €500 million in investments by the end of 2017. Approximately half of these investments are for implementing the programme for the replacement of traditional meters with “smart” meters. In the first nine months of the year 1.1 million meters were added bringing the total of new meters installed to around 2.3 million –  equal to 35% of the total and in line with the goal of completing the plan between 2019 and 2020.

In the first nine months of 2017 the Group generated cash flow from operating activities of €375.1 million, which enabled the funding of the investment plan and the payment of a dividend for 2016 maintaining the net financial position as at 30 September 2017 at approximately €3.7 billion.

Paolo Gallo, CEO of Italgas, commented:

“The results confirm the positive growth trend registered since the beginning of the year thanks to the positive effect of the rationalisation process, the corporate restructuring, the control of operating costs and financial optimisation. All the main economic indicators demonstrate a double digit growth; in particular EBITDA rose by  20% and net profit by 28%. The implementation of our investment plan is progressing in line with the objectives presented to the market, and with a focus on the replacement of meters, network development and replacement initiatives, and the application of digital technological solutions which will continue to generate efficiencies and benefits for the entire Italian gas distribution system”.

Key figures Consolidated economic and financial highlights:

  • Total revenue: €835.0 million (+7.2%)
  • EBITDA: €577.9 million (+20.0%)
  • EBIT: €306.7 million (+14.7%)
  • Net profit: €213.3 million (+27.8%)
  • Technical investments: €346.5 million (+39.8%)
  • Net cash flow from operating activities: €375.1 million
  • Net financial debt: €3,728.3 million

Operating highlights including unconsolidated affiliates:  Gas concessions: 1,581

  • Number of active meters: 7.4 million
  • Gas distribution network: more than 65,000 Km

Conference call: third quarter 2017 report

Paolo Gallo, CEO, and Antonio Paccioretti, General Manager, present 2017 Third Quarter Results.

Conference Call for the presentation of results to the community will be held on Monday, October 23rd, 2017 at 5:30 pm CEST.

Italgas acquires 100% of Enerco Distribuzione S.p.A

Milan, 19 October 2017 – Last night, Italgas signed a binding agreement with H2C SpA to acquire 100% of the subsidiary Enerco Distribuzione S.p.A., which is headquartered in Padua and active in the natural gas distribution sector in the Padua and Vicenza provinces.

Enerco Distribuzione has 27 concessions, operates a network of over 800 kilometers of pipelines, and supplies approximately 30 thousand customers.

The value of Enerco Distribuzione’s assets (enterprise value) was set at Euro 51 million. At the closing of the transaction, the sum will be paid entirely in cash, net of debt. The closing is expected by the end of 2017 and is subject to pre-closing requirements by H2C.

Paolo Gallo, Chief Executive of Italgas, commented: “The acquisition of Enerco is part of Italgas’ development strategies that we announced to the market. Through acquisitions of small and medium-sized operators, the Company is pursuing its goal of consolidating the gas distribution market ahead of the concession tenders. In what remains a fragmented market with over 200 companies in operation, Italgas plans to confirm its leading role in national consolidation, carrying out targeted transactions that create value for the its shareholders. The result of this process will benefit the entire Italian gas distribution system and generate important investments in the territory. The acquisition of Enerco, an efficient gas distribution operator, marks the first of a series of transactions in the coming months where Italgas will be the key player“.

Moody’s affirms Italgas at ‘Baa1’, Negative Outlook

Milan, 12 October 2017 – Moody’s Investors Service (“Moody’s”) has affirmed Italgas S.p.A Long-Term Issuer Rating at ‘Baa1’ with Negative Outlook.

The rating affirmation reflects the Group’s strong focus on domestic low-risk gas distribution activities under a well-established and supportive regulatory framework.

Moody’s highlights Italgas’s strong cash flow generation and the good degree of operating efficiencies that would allow the Company to have a competitive advantage in the upcoming gas concession tenders.

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