Outlook: expected performances

Outlook: expected performances

Although 2021 is still marked by the emergency state due to Coronavirus, we currently do not detect significantly negative impacts on development and investment initiatives linked to the deterioration of the macroeconomic context.

We have got advantage of the processes digitalization to implement interventions to ensure, operating in absolute safety, the continuity and effectiveness of construction site activities and customer interventions, in compliance with the terms defined in the business plans.

With reference to the customer base/sales company and their solvency, we remind you that the rules for user access to the gas distribution service are established by ARERA and are regulated in the Network Code. In this moment, we do not estimate any significant negative consequences on the expected receipts from gas sales companies that could affect our financial balance, as well as on the regularity of payments by counterparties.

We do not expect significant negative impacts for access to credit. Any downgrading of the rating of Italgas or of any guarantors beyond pre-established thresholds could result in the issue of guarantees in favor of some lenders or an increase in the spreads applied. As of March 31, 2021, the only loan agreement that provides for financial covenants, which are respected, is the EIB loan of 90 million euros signed by Toscana Energia.

The success of the latest bond issue in implementation of the EMTN Program, as well as the confirmation of the rating by Fitch (BBB +, stable outlook) and Moody’s (Baa2, stable outlook), which took place on 3 December 2020, attest to our financial strength and confirm our ability to access the capital market.

With reference to the impacts, even potential ones, on revenues, investment costs and expected cash flows deriving from the limitations still imposed by the health emergency, at the beginning of May 2021, we do not find evidence such as to predict significant negative effects on 2021 results. However, we cannot estimate any material adverse effects on the economic, financial and equity prospects in the coming periods, should the health emergency situation persist or recur in critical forms.

In this context, we will continue to achieve our strategic objectives, focus on digital transformation, and continue to carry out the investment context, mainly aimed at the implementation of network digitization projects and methanisation of Sardinia, in addition to the usual maintenance and development of the networks under management.

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