To grow not only to consolidate our market positioning, but also to help transform the gas infrastructures in Italy, make our company increasingly efficient, invest in innovation to play our part in Italy’s digitisation: these are the priorities in our 2018-2023 Strategic Plan.
Our company’s return to the stock exchange at the end of 2016 marked a change in pace, imposing acceleration on all our activities. We announced a €5 billion investment programme up to the end of 2023, with the goal of developing an increasingly efficient, technologically advanced network and strengthening our distribution leadership in Italy.
Our priorities are workforce growth, operating and financial efficiency and sector consolidation, mainly through calls for tender. In parallel, we’ll constantly be working on the digital innovation that will transform our network.
Download the presentation of the 2017-2024 Business Plan
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The plan sees €5 billion in investments in the development, maintenance and digitisation of the network, as well as complete replacement of traditional meters with smart meters. Added to this is the capital investment to increase the market share from 30% to 40% and bring the RAB from €5.7 billion to over €7 billion.
Clear strategy up to 2023
Solid platform to serve dividend and growth
Investments to strengthen workforce growth
We will dedicate €3 billion to building the workforce over the course of the 2017-2023 Business Plan. This will allow the regulatory asset base (RAB) to rise - over and beyond acquisitions - by 1.4% per year on average (CAGR) between 2016 and 2023.
- Network maintenance and growth: by the end of 2023 we will have dedicated €1.9 billion to developing new sections (for around 500 km) and extending our infrastructures in Southern Italy. We will also be completing the replacement of cast iron sections of the network. Through maintenance works and the completion of new networks, in 2017 we reached 34 new municipalities in Calabria, Sicily and Campania.
- Digitisation: we will invest around €1 billion in digital innovation initiatives. We expect to complete the programme to replace traditional meters with smart meters for the Mass Market segment by the end of 2020. We are transforming our network, gradually digitising it with the widespread installation of sensors. This will allow us manage our network according to innovative methods, criteria and algorithms that will make it unique in Europe. We will also focus on implementing the cloud strategy.
See the box dedicated to new technologies for more information about our innovation initiatives.
New levels of operating and financial efficiency
- Reduced operating costs: the operating efficiency plan launched at the start of 2017 has led to a cost reduction of 15%, compared to 2016, already since the end of last year, well in advance of the target date of the end of 2018. From 2018 onwards, our objective is to keep the cost structure competitive with respect to the targets set by the regulator. The key initiatives relate to the review of the organisational and ownership structure of the Group, implementation of the new territorial model and simplification of the operating processes. We are also transforming the workforce organisation, improving the skills mix.
- Financial efficiency: we have launched a medium-term and long-term issues programme. This has allowed us to make our financial structure even more solid and efficient, with diversification of funding sources, a more suitable balance between fixed rate (representing around 70% of our debt) and floating rate, and an average borrowing cost below 1%.
- Optimisation of the financial structure: over the course of the plan we will continue the action designed to keep the borrowing costs at excellent levels and the financial flexibility necessary for our growth. Its presence in a low risk business helps to obtain financing with interesting terms.
Increase the market share through tenders and M&A
- A decisive role in consolidation of the sector: over the course of the plan we will invest €2 billion on participation in calls for tender, with the aim of reaching over 8 million active redelivery points in 2023 compared to the 6.5 million at the end of 2016, and to increase our market share from around 30% in 2016 to 40% by the end of the plan. Of the €2 billion, €1.4 billion will be dedicated to acquiring networks through tenders awarded to us, while the remaining €600 million will be dedicated to developing and maintaining the portfolio of assets acquired through the tenders. Participation in tenders and M&A action will allow the consolidated regulatory asset base (RAB) to grow at a CAGR of 4.5% between 2016 and 2023.
- To consolidate our presence in territorial areas of interest and to invest in areas of Italy that do not yet have the benefit of natural gas infrastructures. Part of this plan are the acquisitions carried out in 2017 and the first few months of 2018 in the North-East, Campania, Basilicata, Calabria and Sicily, as well as those operations that have enabled our entry to Sardinia with a leadership role project for natural gas distribution on the island. In 2018 additional initiatives for the development of external lines will be carried out, which will enable the strengthening of our presence and competitiveness in the calls for tender.
New technologies to position us at the forefront in the sector
Digital innovation is a keyword and a priority for our management. Through new technologies we have the opportunity to give a “digital identity” to the network. This is the industrial Internet of Things (IoT): numerous sensors distributed across the network that can communicate and interact with each other and with the outside environment to provide information and make decisions, for example to regulate certain operating parameters. Digitisation will therefore allow predictive maintenance - acting before the problems arise - to be carried out, and also give the sales companies more information on gas consumption by the end customers. Digital technologies are also transforming how our technicians work. They can now perform a variety of activities in the field which until a short time ago required their presence in the office. We are taking our first steps into this realm, also profiting from benefits offered by the Public Cloud.
ultimo aggiornamento Wed Jul 18 05:52:28 UTC 2018