April 2019

01 FY2018 Financial Results 02 Italgas commitment to an effective proxy campaign 03 Stronger Governance following the 2019 Shareholders’ Meeting

01. FY2018 Financial Results

Data di pubblicazione: April 25, 2019

Strong cash generation supports a demanding investment program.
In Italgas 2018 investment amounted to 522.7 million Euro

More than a third of 2018 investments was aimed at installing 1,650 thousands smart meters. At the end of 2018, including non-consolidated affiliates, installed smart meters were around 5 million, i.e. 59.1% of the entire meter fleet.Such figure, which exceeds the 50% share to be reached by the end of 2018, as set by the Authority, also allows Italgas to expect that the replacement of its meter fleet will be completed in early 2020. In 2018 the Cash Flow from Operations increased by 30.8% vs. 2017, reaching 718.7 euro. That made possible to fully fund investments, net of grants, and the change in related payables, equal to 471.3 mln€, generating 247.4 mln€ pre-M&A Free Cash Flow. After accounting for the M&A disbursement and the payment of FY2017 dividends, Net Financial Debt at the end of 2018 amounted to 3,814.3 mln€, an increase of 94 mln€, net of the incremental effect (49.9 mln€) of the changes associated with the adoption of IFRS 16 on lease payables.

Attractive dividend yield

The Shareholders’ Meeting held on 4 April 2019 approved the distribution of a 0.234 euro dividend per share, a 12.5% increase over that distributed for FY 2017. the Dividend yield, calculated on the official price at the end of 2018 (4.996 euro), amounts to 4.7%. The 2018 dividend will be paid as of 22 May 2019, with an ex-dividend date of 20 May 2019 and record date of 21 May 2019.

All leading indicators of italgas 2018 P&L grew in comparison to 2017. Such performance proves that Italgas is firmly on track with the path towards a profitable development set in the 2018-2024 business plan.

The operating area shows Total Revenues growing by 4.6% and EBITDA raising even faster (+8.2%). The improvement of the margins reflects positive returns on organic investments and acquisitions, together with the achievement of further efficiencies: Italgas has reduced its costs by 3% compared to 2017 and 19% compared to 2016, despite the scope of consolidation has seen a significant expansion since then.The 7.1% increase in the Net Profit was driven by the 8.5% growth of EBIT. The EBIT increase of 35.6 million euro has been partly offset by higher Net Interest Expenses (+10.8 million euro). The latter are mainly due to liability transactions of January 2018 (aimed at lengthening the average maturity and increasing the fixed-rate share of Italgas debt), besides the impact on 12 months of the cost of the bonds issued in 2017.