Author: adigiuseppe

NOT TO BE PUBLISHED OR DISTRIBUTED IN THE UNITED STATES, AUSTRALIA, CANADA AND JAPAN

Milan, 17 July 2019 – Today Italgas SpA (rating BBB+ by Fitch, Baa2 by Moody’s) successfully priced a new fixed rate note issue, with April 2030 maturity for an amount of 600 million euros with an annual coupon of 0.875% under its EMTN Programme (Euro Medium Term Notes) established in 2016 and renewed by resolution of the Board of Directors on November 5, 2018.

With today’s issue, Italgas is taking advantage of the current favorable market conditions in order to optimize the cost of debt while extending its maturities.

The transaction has gathered more than 3 billion euros of demand from a high quality and geographically diversified investor base.

Joint Bookrunners of the placement, restricted to institutional investors only, were BNP Paribas, JPMorgan, UniCredit, Banca IMI, Mediobanca, SocGen.

The bond will be listed on the Luxembourg Stock Exchange.

Details are as follows:

Amount: 600 million euro

Maturity: 24 April 2030

Annual coupon: 0.875%

Issue price: 98.92

DISCLAIMER

This announcement (and the information contained therein) does not constitute or form part of any offer to sell nor a solicitation of any offer to buy any securities nor shall there be any offer of securities in any jurisdiction in which such offer or sale would be unlawful. It may be unlawful to distribute this announcement in certain jurisdictions. This announcement does not constitute an offer of securities for sale in the United States, in Australia, Canada and Japan and in any jurisdiction in which such offer or sale would be unlawful and is not for publication or distribution in any such jurisdictions. The securities referred to in this announcement have not been and will not be registered under the US Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This announcement is not a public offer of financial products in Italy as per Article 1, para. 1, letter. t) of Legislative Decree no. 58 of February 24, 1998. The documentation relating to the offer has not been/will not be submitted to the approval of CONSOB.

London, 12 June 2019 – Chief Executive Officer Paolo Gallo is today presenting to analysts and investors the Italgas Group’s Strategic Plan for the 2019-2025 period, which was approved yesterday by the Board of Directors chaired by Alberto Dell’Acqua.

The new Plan is structured along four guidelines: (i) innovation and digital transformation of the Company through the digitization of assets and processes and the development of digital skills for all employees, (ii) construction of the natural gas distribution network in Sardinia, (iii) new M&A operations and (iv) further organic growth, in terms of network extension and redelivery points served..

The Plan provides for a significant increase in investment programmes, equal to 500 million euros (+12.5%) compared to the previous one, to take the Company into the digital age, strengthening its leadership at European level, taking advantage of all development opportunities, and creating value for shareholders.

Highlights

• Digitization of networks and business processes for a total investment of approximately 1 billion euros. Completion in 2020 of the installation plan for smart meters and 500 new digital networks.

• 500 million euros to build the most technologically advanced natural gas distribution network in Sardinia (“methanization”).

• over 2 billion euros for organic development, maintenance and network extensions.

• Total investment plan of 4.5 billion euros (+ €500 million, +12.5%) with additional investment opportunities of approximately 1.9 billion euros for the acquisition of networks following sector tenders and related capex.
  

• Current dividend policy confirmed.

Paolo Gallo, Italgas CEO, said:

“The main focus of the plan is the company’s digital transformation. Innovation, a growing trend in our sector, will create two categories of companies: frontier companies and followers. While today Italgas is a leader in history and size, tomorrow, thanks to investments in digital, it will become a ‘frontier company’, leader at European level. At the end of this long journey Italgas will have one of the most technologically advanced networks, with the application of advanced digital solutions.

The partnerships recently concluded with important global players – Picarro in the USA, State Grid Corporation in China and Eda Thess in Greece – provide the international recognition needed in demonstrating the quality of the path taken.

4.5 billion euros in investments, up 12.5% on the previous Plan, and an opportunity to invest a further 1.9 billion euros in sector tenders: these figures place Italgas among the main industrial companies in the country that create value for the communities in which they operate and for investors.

In light of the results achieved in recent years and the growth and development activities undertaken, this Plan revises all its main targets upward. As such it also confirms the current dividend policy, which has proved particularly profitable for our shareholders, evidenced by the latest financial statements, with a dividend up 12.5% on the previous year”.

Milan, 14 May 2019 – Italgas’ Board of Directors, chaired by Alberto Dell’Acqua, met yesterday and approved the consolidated (unaudited) results for 2019 first quarter.

Key figures

Consolidated economic and financial highlights:

• Total revenue: €310.8 million (+9.9%)
• EBITDA: €219.2 million (+10.5%)
• EBIT: €123.6 million (+10.0%)
• Net profit: €86.3 million (+15.5%)
• Technical investments: €152.4 million (+43.6%)
• Cash flow from operating activities : €242.2 million
• Net financial debt : €3701.9 million

Operating highlights including investee companies:

• Municipalities in gas distribution concessions: 1,803
• Number of active meters: 7.57 million
• Gas distribution network: around 70,000 Km

The economic and financial results confirm the continuous growth process recorded by the Company since its return to the stock market in November 2016, inaugurating a new management cycle focused on further improvement in margins compared to the same period of 2018.

With €152.4 million in organic investments in the first quarter, Italgas significantly exceeds the targets defined in the Business Plan, an increase in line with that already announced to the market. In particular, over 50% of the investments were allocated for the maintenance and extension of the network (170 km against 40 last year), while the installation of the smart meters continued, in line with last year, replacing traditional meters, and this replacement will be completed by the first half of 2020. With approximately 410.0 thousand meters installed in the first three months of 2019, the total, also considering investee companies, was around 5.4 million, equal to 63.9% of total meters . The installation of the smart meters is part of the digitalisation project of the network for which over 50 pilot projects have been already completed throughout the country, covering approximately 200 kilometres of distribution network and a total of 11,800 smart meters.

The financial requirements related to the net investments in 1Q 2019 were fully covered by the positive cash flow from operating activities, amounting to €242.2 million, with a Free Cash Flow – before the M&A transactions – of € 112.7 million.
Net financial position as at 31 March 2019 was equal to € 3,701.9 million (€3,814.3 million as at 31 December 2018).

With regards to the economic results, operating profits in the first quarter of 2019 reached €123.6 million (+10.0% compared to 31 March 2018) and net profit reached €86.3 million (+15.5% compared to the same period of the previous year).

Paolo Gallo, CEO of Italgas, commented:

“The results of the first quarter 2019 also confirm the virtuous path undertaken by Italgas since November 2016, with all the indicators showing double-digit increases. In particular, compared to the same period of 2018, EBIT and net profit showed increases of +10% and +15.5%, respectively, demonstrating the effectiveness of the acquisitions made and the important efficiency improvement actions undertaken in the last two years. Investments for the period recorded an increase of 43.6%, and investments on the network (maintenance and extension) in particular, which are the most valuable investments for the Italian economy, grew by over 70%. We are continuing the process of installing smart meters, which will be completed in the first half of 2020, and the larger project of digitalisation of the networks, which will contribute to strengthening Italgas’ leadership in Italy and in Europe. In acknowledging our role, two important partnership agreements were signed in recent weeks: with State Grid Corporation of China, the largest utility in the world, and with the US company Picarro, a leader in providing smart software for monitoring networks”.

[1]Net of the effects deriving from IFRS 16 and IFRS 15.

[2]Net financial debt as at 31 March 2019 did not consider financial payables for operating leases pursuant to IFRS 16 of €65.7 million (€49.9 million as at 31 December 2018).

[3]Excluding investee companies, in the first quarter of 2019, Italgas installed about 363.5 thousand new meters, bringing the total number of installed meters to about 4.8 million, equal to approximately 63.4% of the entire meter fleet.

The purchase, announced at the end of 2018, enables the acquisition of over 50,000 new users and confirms Italgas position as the leading operator on Sardinia island, thanks to an increasingly widespread presence now extended to the capital cities of Cagliari, Nuoro and Oristano

Milan, 30 April 2019 – Italgas today has executed the acquisition from Conscoop group of companies stakes and business going concerns including 19 concessions for gas distribution and over than 50,000 redelivery points concentrated in the Central-Southern regions of the country and in Sardinia.

The transaction, which was announced on 2018, 28 December, was finalized following the fulfilment of the conditions precedent set out in the agreement.

The agreement consists of the acquisition of:

• a business going concern from Aquamet S.p.A. including, among others, 9 concessions for the distribution of natural gas in some municipalities in Lazio, Campania, Basilicata and Calabria, for a total of approximately 23,800 users served;
• a 100% stake of the company Mediterranea S.r.l., owner of 6 concessions for the distribution of natural gas in the province of Salerno, with over 3,600 users served;
• a business going concern from Isgas Energit Multiutilities S.p.A. including, among others, the concessions for the distribution of gas in the Sardinian municipalities of Cagliari, Nuoro and Oristano, for a total of approximately 22,400 users currently served with LPG.

The total evaluation of these acquisitions (enterprise value) has been set at €68.6 million, with the price paid entirely in cash, net of debt.

In addition, within the same agreement, Italgas completed the acquisition of a 10% stake of the company Isgastrentatrè S.p.A., owner of the concession for the distribution of gas in Basin 33 of Sardinia, which is governed by the municipality of Quartu Sant’Elena (CA), with 600 already active redelivery points out of the 18,500 potential users currently served with LPG.

The agreement for the acquisition of Isgastrentatrè also provide for the commitment to take over the remaining 90% stake of the company when certain conditions are satisfied, including the conversion to natural gas of the network currently fuelled by LPG with the specification that, if the conditions are not met, Italgas is entitled to sell and Conscoop is obliged to purchase the 10% stake at the same price (equal to €300,000).

With the 19 new concessions taken over, for over 50,000 users, Italgas further consolidates its leadership in the sector and confirms its position as the leading operator in Sardinia, thanks to an increasingly widespread presence that now also includes the capital cities of Cagliari, Nuoro and Oristano.