Efficiencies and returns
Continuous focus on operational efficiencies through digital transformation
In recent years, Italgas has developed a solid track record, as it proved to successfully reduce operating costs year after year while executing a number of well-targeted initiatives. From now on, Italgas expects to achieve new levels of efficiency by leveraging the benefits deriving from technological innovation and digitization. Through the transformation underway, it expects to be able achieve total benefits of approximately 210 million euro over the Plan’s period, with an improvement of 50 million euro compared to the savings estimates of the previous Plan, leveraging on reduction of operating costs, optimization of investments and higher revenues.
More in detail, over the Plan, Italgas intends to fully offset the negative impact of the X factor set by the Regulator at challenging levels. The unit cost reduction per redelivery point may be even more significant as new tenders are won, as Italgas will be able to leverage increasing economies of scale and optimized geographical distribution of the network, with benefits that will more than compensate the negative impact expected from higher costs associated with concessions.
Financial efficiency - current virtuous situation an addional lever of value-creation available
Today Italgas has an optimal financial structure, with the Net Debt-to-RAB ratio around 60%, the FFO-to-Net Debt ratio slightly higher than 15%, a cost of debt of c.1%, and a weight of fixed-rate debt around 97%.
The objective is to keep this virtuous picture intact over the Plan’s period, so as to continue to also benefit from rating metrics in the area of solid investment grade.
The Net Debt-to-RAB ratio is expected to remain constantly well below 70%. Moreover, during the Plan’s period, Italgas expects Operating Cash Flow to fully cover organic capital expenditure and dividend distribution, with the FFO-to-Net Debt ratio remaining well above 10%. Considering the yield to maturity of Italgas' debt, there also appears to be headroom for further reductions in the cost of debt, including through sustainable financial instruments.
ultimo aggiornamento 09 December 2020 10:52 UTC