Milan, November 21st, 2023 – The rating agency Moody’s has affirmed today Italgas S.p.A LongTerm Issuer rating at ‘Baa2’, revising the Outlook to Stable from Negative.
The rating action follows the outlook change to Stable from Negative on the Italian government’s Baa3 debt rating, carried out by Moody’s last 17 November 2023.
Milan, 20 November 2023 – The rating agency Fitch has affirmed today Italgas S.p.A long-term issuer default rating at ‘BBB+’, with Stable Outlook.
The rating affirmation reflects the risk profile of the gas distribution business in the Italian and Greek markets, the latter being smaller in size but experiencing strong expansion, along with the growing ambitions of the Group in Italian water sector regulated activities.
The rating agency highlights the strength of the Italian regulatory framework, the robustness of the 2023-2029 Strategic Plan, and the consistency of indebtedness levels with the metrics underlying the rating assigned.
Milan, 10 November 2023 – Moody’s Investors Service (Moody’s) affirmed today Italgas S.p.A Long-Term Issuer Rating at ‘Baa2’, Negative Outlook that reflects Italgas’ exposure to the Italian sovereign credit.
The rating affirmation is based on the strong track record of operational efficiencies and on the solid financial position, as well as of the low risk profile of the gas distribution business, thus allowing Italgas to benefit from solid cash flows derived from regulated activities in Italy and Greece.
Furthermore, Moody’s highlights the progressive implementation of the new 7.8 billion euro investment plan expected in 2023-2029 and the Company’s solid liquidity profile, combined with the strong push for technological innovation and network digitalization, will provide Italgas with a competitive advantage in the upcoming tenders.
Milan, 25 October 2023 – Italgas’ Board of Directors, chaired by Benedetta Navarra, met yesterday and approved the consolidated results of the first nine months and third quarter of 2023 (unaudited).
Key figures
Consolidated economic and financial highlight
Operating Highlight1
Sustainability highlights
In a context of high international tensions, with the inevitable impact on energy costs and financial markets, Italgas has maintained its uninterrupted growth trajectory for 27 consecutive quarters.
The first nine months of 2023 have witnessed an intensified operational activity within the Group, aimed at achieving the targets set in the 2023-2029 Strategic Plan and the Sustainable Value Creation Plan, with a particular focus on the digital transformation objectives of the network, a key enabler of the energy transition.
In line with the 2023-2029 strategic plan, but ahead of the projected timeline, on September 30th, the corporate simplification of the Depa Infrastructure Group was successfully completed. Specifically, the merger by absorption of EDA Thess and EDA Attikis into DEDA S.A. was finalized. As a result of this merger, DEDA is entrusted with the development and management of the gas distribution service in all regions of Greece where the Depa Infrastructure Group operates. Currently, the company manages approximately 7,700 kilometers of network and serves over half a million customers.
Meanwhile, the acquisition that was announced on March 14th by Veolia Environnement S.A. of the business division holding water concessions in Italy has now been successfully finalized. With a service reach extending to around 6.2 million individuals directly and indirectly, constituting 10% of Italy’s population, this development situates NEPTA, the newly established company through the integration of these operations, as a significant player in the sector. The main developmental focus revolves around the digital transformation of water infrastructure, with the aim of reducing network losses and elevating service quality standards.
In the first nine months of the year, € 589 million of investments were made, mainly for the extension, digital transformation and repurposing of networks. More specifically, 679 kilometres of new gas pipelines were laid.
The contribution from activities in Greece has been significant, where an investment of approximately 74 million euros has led to the construction of 435 kilometres of new gas pipelines.
The EBITDA for the first nine months of 2023 amounted to € 910.5 million (+15.9% compared to 30 September 2022) and adjusted net profit attributable to the Group was € 316.7 million (+10.8% compared to 30 September 2022).
Cash flow from operating activities, net of the ESCo contribution, amounted to 576.8 million euros and fully offset investments related to gas distribution.
With reference to sustainability goals, the significant contribution of the various innovation, digitisation and energy efficiency initiatives, both in the industrial and civil sectors, as well as the training activities aimed at employees on energy efficiency issues, have allowed the Group to continue on its path towards reducing net energy consumption (-14.1%) as well as the ratio of fugitive emissions to kilometres of inspected network (-10.8%), even against the inclusion of the DEPA Infrastructure Group’s contributions related to 2023.
Paolo Gallo, CEO of Italgas, commented:
“In the first nine months of 2023, the Italgas Group achieved strong and valuable performance, allowing continued growth even in an unstable socio-economic context due to the ongoing international tensions.
This success can be attributed to several factors: our vision that reaffirmed the pivotal role of gas distribution networks – smart, digital, and flexible – in a secure, sustainable, and competitive ecological transition. Furthermore, significant milestones already achieved in Greece, including the merger of three DSOs into a single operator, and in the water sector, with the successful completion of the acquisition of Veolia concessions.
All economic indicators have displayed double-digit growth, with EBITDA showing an increase of 15.9%, surpassing 900 million euros, and a Group Adjusted Net Profit of 316.7 million euros, up by 10.8% compared to the same period last year.
With nearly 600 million euros invested in the first nine months, the company intensified its efforts to expand and digitally transform gas networks, both in Italy and Greece, further promoting their evolution as a strategic driver to produce renewable gases like biomethane, synthetic methane, and hydrogen.
Digitization, decarbonization, circular economy, and training continue to be strategic factors for achieving our growth objectives. These targets will depend on our ability to continually raise the bar of innovation, leveraging our most valuable resource, our people”.
1 The figures as at 30 September 2023 also include affiliates.
The transaction confirms the Group’s growth strategy in the water sector and will enable it to serve, directly and indirectly, 6.2 million citizens.
Milan, October 16, 2023 – Italgas finalized today the acquisition from Veolia Environnement S.A. Group of the business unit responsible for the concessions held in the water sector in Italy.
The acquisition, announced on 14 March, was finalized following clearance of the Granting Authorities.
With this transaction, Italgas launches its strategy to expand its presence in the water sector. As of today, the Group serves – both directly and indirectly – 6.2 million individuals, equivalent to approximately 10% of the Italian population
The name of the Group’s company, which will now encompass all water-related activities, including the concessions in Caserta and its province, will also be changed to Nepta. This change is intended to emphasize the connection with the mythological world of water through a name that also echoes a reference to technology in line with the future of the networks entrusted to the Italgas Group.
Italgas CEO, Paolo Gallo, commented as follows:
“In a country that has negative records regarding the efficiency of water networks, with losses of over 40% up to peaks of 70%, a paradigm shift is needed, a different approach, based on the use of digital technologies, that allows the problem to be tackled proactively and effectively. Today begins another important chapter in our bicentennial history. Italgas becomes a key player also in the water sector and evolves increasingly towards the form of a «Network Tech Company». The technological breakthroughs achieved in the gas networks allows us to broaden our horizons to other sectors. This operation arises from the awareness that by leveraging our technologies and expertise in the water sector, we will be able to realize significant benefits, including enhanced service efficiency and a reduction in losses by 15% to 20% compared to current levels. This is a significant milestone for the communities served and a further boost for the sustainable development of the country we have been serving for 186 years”.
For the purchase of the business unit, Italgas will be able to pay the Veolia Group a total of up to EUR 115 million (in terms of equity value), partly subordinated to the achievement of certain objectives of the operating companies.
Milan, 29 September 2023 – Italgas’ Board of Directors, chaired by Benedetta Navarra, met today and approved the renewal of the EMTN Programme (Euro Medium Term Notes) with a maximum nominal amount of 6.5 billion euro.
As of today, under the current EMTN Programme the notes outstanding are in nominal amount equal to 4.98 billion euro.
The Board of Directors has also approved the issue of one or more bonds to be placed only with institutional investors within one year by the signing date of the Programme. 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 the regulated markets.
Through the EMTN Programme the Company will still be enabled to issue also Sustainability-Linked Notes, in line with Italgas’ strategy of achieving the sustainability targets disclosed to the market during the Strategic Plan 2023-2029 presentation.
Milan, 25 July 2023 – The Italgas’ Board of Directors, chaired by Benedetta Navarra, met today and approved the consolidated results for the first half of 2023.
Key figures1
Consolidated economic and financial highlights
The item expresses net financial debt excluding the effects of IFRS 16 payables and the Italgas NewCo shareholder loan, inclusive of interest.
The item does not include liabilities for € 35.5 million consisting of the pro-rata share of the shareholder loan, including interest, to Italgas NewCo S.p.A, subordinated and convertible into shares, subscribed by the shareholder Phaeton Holding SA, deemed not to be financial debt.
Operating highlights4
Sustainability highlights
In the first six months of 2023, Italgas Group’s operational activities aimed at achieving the goals of digital network transformation, the main enabler of the energy transition, and the targets set in the Strategic Plan 2023-2029 and the Sustainable Value Creation Plan continued. Italgas’ distribution networks – smart, digital and flexible – are ready to accommodate renewable gases, such as biomethane and synthetic methane, and to support a safe and cost-competitive green transition for industries and citizens.
During the first six months of the year, 398.2 million euros of investments were made and those investments were dedicated mainly to the extension, digital transformation and repurposing of networks. More specifically, 478 kilometers of new pipelines were laid in the first half of 2023. A significant contribution was dedicated to Greece, where were carried out activities worth an investment of about 50 million euros, for the completion of 311 kilometers of new pipelines, more than half of which related to the methanization plan in DEDA’s sphere of responsibility.
EBITDA for the first six months of the year amounted to 607.0 million euros (+18.3% compared to June 30, 2022) and net income attributable to the Group was 213.2 million euros (+14.9% compared to June 30, 2022).
With reference to sustainability goals, the significant contribution of the various innovation, digitisation and energy efficiency initiatives, both in the industrial and civil sectors, as well as the training activities aimed at informing employees on energy efficiency issues, have allowed the Group to continue on its path towards reducing net energy consumption (-14.7%) and related emissions (-12.0%), even against the inclusion of the DEPA Infrastructure Group’s contributions related to 2023.
Paolo Gallo, CEO of Italgas, commented:
The first half of 2023 shows a trend in continuity with past years, under the banner of steady growth and performance of excellence at the service of development in the countries where Italgas is present and operates.
The results achieved confirm the centrality of gas networks – smart, digital and flexible – and the Italgas Group in achieving the REPowerEU targets and, through them, a safe and competitive ecological transition.
All economic indicators showed double-digit growth with EBITDA reporting an increase of 18.3% to more than 600 million euros and Group Net Income of 213.2 million euros, up 14.9 % compared to the first half of last year, thanks in part to the development of activities in Greece and those in the field of energy efficiency.
With nearly 400 million euros invested in the first half of the year, the Company is confirmed as one of the leading industrial entities in terms of its ability to invest and ground projects that can help improve people’s quality of life. We have laid the foundations to play our part in the management of water services as well: by taking advantage of the technologies developed for gas and applying them to this sector, it will be possible to achieve immediate results in terms of efficiency and cost-effectiveness of the service for territories and communities.
The goal of carbon neutrality to 2050 is achievable through progressive reductions in net energy consumption and Scope 1, 2, and 3 emissions, and the results we achieve quarter after quarter prove it. Not only that. To actively promote further change, we have also introduced new targets referring to gender pay equity and the development of skills and enhancement of resources: actions that are indispensable for continuing to focus on innovation and putting it to value for the entire Group.
1 Data as of June 2023 includes the Greek DEPA Infrastructure group.
2 The item expresses net financial debt excluding the effects of IFRS 16 payables and the Italgas NewCo shareholder loan, inclusive of interest.
3 The item does not include liabilities for € 35.5 million consisting of the pro-rata share of the shareholder loan, including interest, to Italgas NewCo S.p.A, subordinated and convertible into shares, subscribed by the shareholder Phaeton Holding SA, deemed not to be financial debt.
4 Data as of June 2023 includes the Greek DEPA Infrastructure group
Milan, 13 July 2023 – Italgas informs that RAEWW, the Greek Regulatory Authority for Energy, Waste, and Water Regulation, has disclosed the return (WACC – Weighted Average Cost of Capital) on the RAB (Regulated Asset Base) for 2023 for EDA Thess, EDA Attikis and DEDA (Italgas’ Greek DSOs), setting it at 8.57% (compared to 7.03% in 2022).
The decision was taken in accordance with the provisions of article 260 of Law 5037/2023.
The full document in its original language from RAEWW is available at the link https://www.rae.gr/apofaseis_/67961/
Change of date of the Press Release relating to the results as at June 30th, 2023
Milan, 19 June 2023 – Italgas announces that the publication of the press release relating to the approval of the results as at June 30th, 2023 has been moved forward from July 26th to July 25th 2023, following its approval by the Board of Directors.
Consequently, the conference call to present the results to institutional investors and financial analysts will be held in the afternoon of July 25th 2023.
Investments of € 7.8 billion for the development and digital transformation of assets, strengthening in Greece, and becoming a key player in the water distribution and energy efficiency sectors, while continuing to play a leading role in achieving EU climate goals. Dividend policy updated and extended until 2026.
London, June 15, 2023 – Italgas CEO, Paolo Gallo, presents today to analysts and investors the Group’s Strategic Plan for the period 2023-2029, approved today by the Company’s Board of Directors chaired by Benedetta Navarra.
The new plan includes total investments of €7.8 billion, mainly dedicated to interventions for asset development and gas distribution activities in Italy and Greece, energy efficiency activities, and water sector development. In this sector, following the recently announced acquisition agreements of Veolia’s assets, the Group expects to seize additional growth opportunities.
The 2023-2029 plan also confirms a strong commitment to creating a fully digitized network, ready for the distribution of renewable gas and therefore serving the ecological transition.
In line with the strategic choices made in recent years by the Group, the Plan aims to promote the ecological transition while ensuring energy security and cost competitiveness of energy, benefiting both companies and households.
The Group can rely on a solid and efficient financial structure – built in previous years – despite a more volatile macroeconomic scenario. Thanks to this financial structure, the new dividend policy, extended until 2026, continues to provide shareholders with the opportunity to benefit from growth through a payout ratio of 65%, while also offering protection with a minimum annual growth guarantee of 4%1.
The plan revolves around ESG principles and addresses sustainability challenges by confirming net energy consumption reduction targets and Scope 1, 2, and 3 emissions reduction targets for the entire Group, including Depa Infrastructure, by 2028 and 2030, in line with the carbon neutrality target by 2050. To further drive change, it also introduces new targets related to gender pay equity and the development and valorization of skills and resources.
Highlight
Italgas CEO, Paolo Gallo, stated:
Since the outbreak of the war in Ukraine, the EU has been grappling with a challenging equation that sees the ecological transition as an essential goal but not at any cost. It is necessary to ensure energy security and an appropriate level of energy costs for families and businesses.
The vision and strategic choices made in recent years position Italgas to significantly contribute to this solution through digitalized, flexible, and intelligent networks capable of accommodating renewable gas. These networks enable source diversification, consumption decarbonization, and greater efficiency and cost-effectiveness.
With €7.8 billion, the Group reaffirms its position among the leading industrial entities capable of leveraging its design, investment, and value creation capabilities to serve the sustainable development objectives of the countries in which it operates.
The largest portion of investments is once again dedicated to the development, digital transformation, and repurposing of the gas distribution network. After twenty years, this network now extends to Greece, where the application of Italgas’ most advanced technologies in the sector will enhance the efficiency and quality of gas distribution services and the work of Depa Infrastructure Group’s personnel.
Water distribution and energy efficiency represent two important sectors for the Group’s diversification and development. With €800 million, we aim to become a benchmark player in these sectors, leveraging the technologies developed for gas. The digitalization of water networks and energy efficiency are drivers capable of delivering more efficient services, reducing losses, and generating wealth for communities and regions.
Digitalization, decarbonization, circular economy, training, diversity, and inclusion remain strategic factors for achieving our growth objectives. The results will depend on our ability to continue betting on innovation and leveraging it through our people.
1Compared to the 2022 dividend.
2Calculated on the entire Group perimeter.
IR & ESG
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