Eni S.p.a. · MIL:ENI
Eni — Investor Day (March 2015)
26 slides from Eni's investor day presentation, Mar 13, 2015
Slide 1: 2015-2018 Strategy Presentation
2015-2018 Strategy Presentation Transforming eni, creating value London, 13 March 2015
Slide 2: 2014 achievements
2014 achievements new organization upstream production in line with guidance RRR >100% positive results in g&p r&m >50% EBIT improvement cash flow from operations +40% capex -5% leverage reduced to 22% 2
Slide 3: A challenging scenario ahead
a challenging scenario ahead Brent price | $/bl 3
Slide 4: Completing Eni's transformation: strategic objectives and actions
completing eni’s transformation strategic objectives actions cash and value exploring for near and growth long term value sustainable faster time to market shareholder projects distribution strict capex and cost control robust balance sheet restructuring mid- downstream re-basing of dividend 4
Slide 5: Main operating targets
main operating targets production CAGR 3.5% e&p exploration: 2 bln boe @ 2,6 $ UEC avg 2017-2018 self financing ratio at ~140% supply 100% aligned to market by 2016 g&p ~100% recovery of ToP cumulative CFFO: 3 bn € 50% capacity cut vs 2012 r&m R&M CFFO and EBIT break-even in 2015 refining EBIT break
Slide 6: Strong cash flow generation
strong cash flow generation CFFO | bln € +40% 2015 action plan capex cut -14%* CAPEX ~12 bln € unitary OPEX -7% g&a saving 500 mln € average Brent average Brent $ 63 $ 85 * Assuming 2014 capex at 2015 FX rate (1.17€/$) 6
Slide 7: E&P – building on our exploration success
e&p– building on our exploration success 4YP target 2 bln boe at 2.6 $/boe (UEC) 7
Slide 8: E&P – long term production growth
e&p– long term production growth 2014-18 CAGR 3.5% 2024 Jangkrik kboed Bahr Essalam Ph2 Val d’Agri CAFC Oil Goliat Perla Mafumeira Sul 15/06East Hub Hadrian South Heidelberg OCTP Oil OCTP Gas CAGR Intisar gas Kashagan EP Argo Cluster Nenè ph2 >3.5% LT +5%* growth fueled by 11 large projects with equ
Slide 9: E&P - a valuable and resilient portfolio of new projects
e&p - a valuable and resilient portfolio of new projects new projects breakeven | $/boe cash flow per barrel | $/boe ∆ = 55 ∆ = 25 self financing ratio ~140% in 2017-18 9
Slide 10: E&P – start ups underpinning growth
e&p– start ups underpinning growth Jangkrik Barge FPU WD @ FPU 120m WD @ Subsea 500m Gas & Condensates Export to shore Jangkrik Jangkrik NE Production Flowlines Condensate Export Umbilicals Gas Export eni operator dec-2014* start up 2H15 1H15 2H17 1H17 2H16 2H2017 plateau eq. kboed 65 75 45 40 40 65
Slide 11: E&P – our integrated approach to exploration & development
e&p – our integrated approach to exploration & development Marine XII equity production | kboed Dev/Prod areas Exploration area Nenè Marine Litchendjili Marine Minsala Marine Minsala Plateau at 150 kboed 11
Slide 12: E&P – sanctioning the 1st LNG in Mozambique
e&p – sanctioning the 1st LNG in Mozambique Coral equity production | kboed Plateau at 160 kboed 12
Slide 13: G&P – successful turnaround
g&p – successful turnaround adj. EBIT | mln € complete gas supply renegotiation round reduce operating and logistic costs by €300m continue to deliver robust results in high value segments CFFO €3 bln in 2015 - 2018 13
Slide 14: R&M – return to a stable and profitable performance
r&m – return to a stable and profitable performance refining margin SERM | $/bl adj. EBIT | mln € +600 sensitivity to +1 $/bl: EBIT +150 M€ CFFO +100 M€ EBIT adj breakeven anticipated to 2015 CFFO >€1.5 bln in 2015 - 2018 14
Slide 15: Refining - increasing resilience at lower margin
refining - increasing resilience at lower margin action plan break-even margin EBIT adj | $/bl ongoing projects Venice green fully on stream >6 EST ramp up Gela refinery closure CRC stakeholding sale further restructuring Gela conversion into green rationalizing weaker assets in Italy reducing i
Slide 16: Chemicals - refocusing on specialties and green products
chemicals - refocusing on specialties and green products adj. EBIT | mln € optimization and reconversion opportunities +500 >30% reduction of commodity capacity portfolio differentiation on specialties and bio-products international development € 400 mln CFFO in 2015 - 2018 16
Slide 17: Key pillars of financial strategy
Key pillars of financial strategy disciplined 17% reduction vs. prior plan CAPEX plan 45% unsanctioned capex cost efficiency g&a reduced by 25% with savings of ~€2bn (new vs. old plan) unitary opex reduced by 7% assets disposals € 8bn disposal plan robust balance 30% leverage threshold sheet commitm
Slide 18: Capex – flexible and focused capex plan
capex – flexible and focused capex plan four year plan capex | bln € flexible spending | (%) -17% -13% -13% 2014-17 capex plan assuming 2015-2018 FX rate 18
Slide 19: Costs – enhanced efficiency in opex and G&A
costs – enhanced efficiency in opex and G&A upstream opex | $/boe G&A costs | bln €/year -25% peers: XOM, CVX, BP, RDS, TOT, REP 19
Slide 20: 8 billion € in the 4YP: disposal programme
disposal – active portfolio management disposal programme excess stake in discoveries Galp & Snam upstream mature assets non core mid-downstream assets 8 billion € in the 4YP disposal figures pre-tax 20
Slide 21: Cash flow - robust generation through the cycle
cash flow - robust generation through the cycle Cash flow bln € solid self financing ratio 20 ~100% 90 $/bl in 2015-16 85 $/bl turnaround, assets 75 $/bl efficiency disposal assets production & other 15 strong cash disposal growth growth from industrial capex improvement 10 (+25%) continuous 5 portf
Slide 22: Shareholder remuneration – rebasing the dividend
shareholder remuneration – rebasing the dividend competitive distribution policy progressive with the growth of underlying earnings floor dividend earnings pay out cash sustainability Earnings pay out (floor dividend) Progressive dividend policy cash neutrality > 100% • $60/bl including disposals in
Slide 23: Transforming Eni, creating value
Transforming eni, creating value 3.5% CAGR production growth mid-downstream back to profit +40% cash flow from operations a stronger and more resilient company 23
Slide 24: Appendix
appendix
Slide 25: Assumptions and sensitivity
assumptions and sensitivity 4YP Scenario 2015 2016 2017 2018 Brent dated ($/bl) 55 70 80 90 FX avg (€/$) 1.17 1.17 1.20 1.20 Std. Eni Refining Margin ($/bl) 4.0 3.5 3.3 3.0 Henry Hub ($/mmbtu) 3.0 3.4 3.6 3.9 NBP ($/mmbtu) 6.8 7.1 7.3 7.4 4YP sensitivity* Ebit adj (bln €) Net adj (bln €) FCF (bln €)
Slide 26: Key start-ups
key start-ups Equity project country op start up (kboed) West Franklin UK no Jan15 7 Eldfisk Norway no Jan15 10 Hadrian South USA no 1H15 15 Perla Venezuela yes 1H15 75 Goliat Norway yes 2H15 65 Val d’Agri PSV Italy yes 1H 15 30 Litchendjili gas Congo yes 2H15 15 Junin 5 EP Venezuela yes 2H15 15 Kiz