Ascopiave S.p.a. · MIL:ASC
Ascopiave — STAR Conference 2007
45 slides from Ascopiave's conference presentation, Oct 3, 2007
Slide 1: STAR Conference 2007 Presentation
STAR CONFERENCE 2007 PRESENTATION London, October 3rd 2007 Page 1
Slide 2: Contents
CONTENTS Business Overview Strategy Financial highlights Dividends Annexes Page 2
Slide 3: Business Overview
Business Overview Ascopiave Group operates in the gas sector in Northern Italy. It ranks sixth* among the operators active in the italian gas market. Primary business activities Secondary business activities Gas Gas sales to Heat Electricity distribution end customers management sales 2006 MAIN FINA
Slide 4: Ascopiave Group structure
Ascopiave Group structure Ascopiave Group Asco Holding S.p.A.* 60% 40% Market 89% 51% ACTIVITIES Gas distribution, heat 80% management Gas and electricity sales 51% ETRA ENERGIA Heat management 55% COGE CALORE Development of a gas storage site 49% ** 15% ITAL GAS STORAGE *Shareholders: 93 municipali
Slide 5: History
History Capability to take opportunities from the market with a strong consolidation track record New Expansion and growth stategy: opportunities • 8 acquisitions New acquisition • +64 new concessions (Bimetano Servizi) • +108,000 new clients 2009 • Investments of 140 €/M Listing on Milan Stock Exca
Slide 6: Shares and Stock Exchange data
Shares and Stock Exchange data Ascopiave was listed on Milan Stock Exchange Star segment on December 12th 2006. The IPO was launched through a public offering for the underwriting of new shares (PUO). Performance of Ascopiave share Main shares and Stock Exchange data price since placement date Share
Slide 7: Current position and future tasks
Current position and future tasks THE GAS CHAIN Actual activity National Gas Import of Liquid Production Import Natural Gas Ascopiave is a strong local player focused on down-stream market Regassification of LNG Current strategy and future tasks Transport Storage Strenghtening its position in the do
Slide 8: Market positioning
Market positioning Main gas distribution Ranking Volumes % Ranking Main gas sales operators Volumes % operators 1 Italgas 7.216 21,4% 1 Eni 36.544 47,3% 2 Enel Rete Gas 3.570 10,6% 2 Enel Trade 7.547 9,8% 3 Hera 2.226 6,6% 3 Enel Energia 4.229 5,5% 4 AEM Distribuzione 1.180 3,5% 4 Hera Comm 1.900 2,
Slide 9: Italian gas market: down-stream
Italian gas market: down-stream No. of gas sales operator Down-stream market Unbundling of regulated activities - 49% Gas sales market: completely liberalized since 2003 Gas distribution activity: competion for the market (public bid for concessions) Consolidation tendencies No. of gas distribution
Slide 10: Gas distribution: Ascopiave concessions
Gas distribution: Ascopiave concessions as of September 30th 2007 60% of concessions from shareholder municipalities Number Populations* Network (km)** Award from Asco Holding member municipalities 92 631.992 3,710 Concessions from other municipalities 62 356.793 2,644 Total 154 988.785 6,354 81% of
Slide 11: Ascotrade gas sales business
Ascotrade gas sales business Volumes of gas sold* (2006) In network 773.5 Out of network 98.9 Total 872.4 Average annual consumption** (2006) Mean consumption higher Ascopiave 2,545 than national average National average*** 1,714 Customer base organic growth Cagr 2002-06 + 3.5% Low switching rate***
Slide 12: Italian gas market: up-stream
Italian gas market: up-stream Up-stream market Strong incumbent players Lack of import infrastructures ITALY Natural gas demand* Source: Eni website Natural gas transported** in Italy Tot. 88,0 scm/G Source: processing on MSE and AIEE data *Billions of standard cubic meters; **Produced and imported
Slide 13: Contents
CONTENTS Business Overview Strategy Financial highlights Dividends Annexes Page 13
Slide 14: Strategic guidelines
Strategic guidelines Strategic guidelines: p taking advantage of opportunities arising from the liberalisation of the gas market, including opportunities in the national and international gas wholesale, transportation and storage market p consolidating its presence as a utility provider in northern
Slide 15: Growth objectives
Growth objectives GROWTH OBJECTIVES Doubling volumes of gas sold by 2011: From about 1 billion of gas cubic metre (current values) to over 2 billion Significat increase of the custormer base by 2011: From 340.000 to over 600.000 end-customers Meeting of more than 70% of expected requirements in 2011
Slide 16: Swot analysis
Swot analysis Strengths Strengths Weakness Weakness Strong liquidity and high investment potentials (with Not present in upstream gas market ‘third party access’ exemption right) Dependence on incumbent gas imports Large end customer base Limited knowledge of the brand outside the region Deeply root
Slide 17: Up-stream integration (1)
Up-stream integration (1) Integration within the gas chain (both mid-stream and up-stream) to ensure gas supply full autonomy and reliability, alongside with an efficient cost structure and a competitive edge on the market Long-term gas supply contracts with international operators Targeted acquisit
Slide 18: Up-stream integration (2)
Up-stream integration (2) p Signing an agreement with Sonatrach for 500 1 Gas Gas Import Import Scm/M of gas p Wholesales trading Gas Gas wholesale wholesale and and p Foreign trading 2 trading trading p Autonomous structuring of the operations along the value chain p Ital Gas Storage acquisition co
Slide 19: Agreement with Sonatrach
1 - Agreement with Sonatrach Key characteristics p Purchase of 500 Smc/M of gas import through GALSI pipeline from 2010 p Obtained ~ 60% of current volumes of gas sold p Duration of the agreement: 15 years from GALSI 2010 National Section p One of 5 italian gas companies to GALSI participate in the
Slide 20: Gas wholesale and trading (1)
2 - Gas wholesale and trading (1) Objectives of the new activities Entering new segments of the value chain capturing extramargins Increasing and stabilizing gas sale volumes Maximizing margin on traditional activities Page 20
Slide 21: Gas wholesale and trading (2)
2 - Gas wholesale and trading (2) Foreign trading ~ 50 million of scm – Y 2007 Import spot ~ 750 million of scm – Y 2007-2008 Gas release 120 million of scm – Y 2007-2009 Autonomous management of logistic operations Trading at “PSV” ~ 150 million of scm – Y 2007-2008 Wholesales ~ 300 million of scm
Slide 22: Gas storage
3 - Gas storage Ital Gas Storage acquisition completed in May 2006 Cornegliano is active in gas storage in Cornegliano ITALY LOMBARDY Storage technical characteristics Working gas (Scm/M) 590-1,010 Cushion gas (Scm/M) 900 Maximum storage capacity (Scm/M) 1,910 Maximum daily use (Scm/M) 16.5 Investme
Slide 23: Import infrastructures and new projects
4 - Import infrastructures and new projects PIPELINE 31 Gmc Plan Capacity Operator Netherlands/ +6.5 Gmc Norway GALSI 8/10 Sonatrach, Edison, Enel, Wintershall, Hera 18 Gmc PIPELINE Gas Natural Slovenia IGI 8 Edison, Depa Trieste 1,5 Gmc Greenstream 2 Eni 8 Gmc ENI Panigaglia Rep. TAG 3,2 +3,3 Eni E
Slide 24: Growth in the gas down-stream market (1)
Growth in the gas down-stream market (1) Growth in size through a significant expansion of its customer base p Participation in competitive bidding for the award of contracts to manage the gas distribution service Increase Increase number number of of clients and clients and p An integrated service
Slide 25: Growth in the gas down-stream market (2)
Growth in the gas down-stream market (2) 1. Acquisitions 2. Acquisitions 3. Partnership (both gas distribution (only gas sales on sales activity and sales business) business) Model Model Model Ascopiave Ascopiave > 50% Ascopiave S.p.A. S.p.A. S.p.A. Ascotrade Bimetano Gas distribution S.p.A. Servizi
Slide 26: Growth in the gas down-stream market (3)
Growth in the gas down-stream market (3) Concluded deal Deals Customers Gas sold Acquisition of Bimetano Servizi gas sale business + 29,453 + 82 scm/M Acquisition of a 51% stake in Global Energy Start-up n.a. Establishment of Etra Energia Start-up n.a. Acquisition of a 49% stake in Estenergy + 243,2
Slide 27: Downstream strategy
Downstream strategy “Triveneto” (BELLUNO) (TRIESTE) ITALY + (VENICE) (PADUA) “Triveneto” natural gas market (2006) Number of gas sale customers 2,500,000 + (ROVIGO) Volumes of gas distributed (Scm/M) 5,784 Municipalities with only gas sales activity Municipalities with gas sales and gas distribution
Slide 28: Operation Estenergy (1)
Operation Estenergy (1) As of September 13th 2007, Ascopiave has signed an agreement with Acegas-APS S.p.A. for the acquisition of a quota of 49% of Estenergy S.p.A., the gas sale company controlled by Acegas-APS. BEFORE THE OPERATION... ...AFTER THE OPERATION 89% 89% 51% 100% 49% Estenergy Ascotrad
Slide 29: Operation Estenergy (2)
Operation Estenergy (2) No. of gas sale customers in “Triveneto” No. of gas sale Ranking Gas sale operators customers in % “Triveneto” After the operation "Triveneto" Estenergy, with over 1 Ascopiave + Acegas-APS 586.000 23% 2 ENI 500.000 20% about 586.000 gas sale 3 Enelgas 160.000 6% customers, As
Slide 30: Operation Estenergy (3)
Operation Estenergy (3) Volumes of natural gas sold in Italy Volumes of Ranking Gas sale operator gas sold in % After the operation Italy 1 Eni 36.544 47% Estenergy, with over about 2 Enel Trade 7.547 10% 1,4 billion of cubic meters 3 Enel Energia 4.229 5% 4 Hera Comm 1.900 2% sold, Ascopiave ranks
Slide 31: Contents
CONTENTS Business Overview Strategy Financial highlights Dividends Annexes Page 31
Slide 32: Financial highlights: income statement
Financial highlights: income statement (Thousand of Euro) 1stH 1stH 2006 2005 Chg Chg % Chg Chg % 2007 2006 Revenues 318.105 279.307 38.797 13,9% 183.845 188.325 (4.480) -2,4% EBITDA 40.405 56.194 (15.789) -28,1% 21.980 31.763 (9.783) -30,8% EBIT 29.150 45.137 (15.987) -35,4% 16.312 26.243 (9.932) -
Slide 33: Financial highlights: balance sheet
Financial highlights: balance sheet (Thousand of Euro) 31/12/06 31/12/05 Chg Chg % 30/06/07 31/12/06 Chg Chg % Capital 281.361 284.574 (3.213) -1,1% 306.924 281.361 25.563 9,1% employed Shareholders 368.902 194.586 174.316 89,6% 365.708 368.902 (3.194) -0,9% equity Net financial (87.541) 89.988 (177
Slide 34: Financial highlights: cash flow
Financial highlights: cash flow (Thousand of Euro) 2006 2005 1stH 2007 1stH 2006 Cash Flow* 27.493 35.579 16.029 20.842 Change in net working capital 8.551 9.287 (23.212) 44.227 Investments (16.593) (15.826) (8.019) (6.415) Change in Shareholders Equity** 158.078 (33.755) (13.555) (3.750) Change in
Slide 35: First Half 2007: volumes of gas and electricity sold
First Half 2007: volumes of gas and electricity sold Volumes of gas sold Volumes of electricity sold (Milion of standard cubic meters) (GWh) ∆ = -58,6 ∆ = +3,8 Page 35
Slide 36: First Half 2007: revenues and EBITDA breakdown
First Half 2007: revenues and EBITDA breakdown Revenues breakdown (1stH 2007) EBITDA breakdown (Thousands of Euro) (Thousands of Euro) Total = 183.845 ∆ = -9.783 Page 36
Slide 37: First Half 2007 EBITDA bridge
First Half 2007 EBITDA bridge EBITDA bridge (Thousands of Euro) ∆ = -9.783 Change in gross margin on gas sales and distribution Page 37
Slide 38: Contents
CONTENTS Business Overview Strategy Financial highlights Dividends Annexes Page 38
Slide 39: Dividends
Dividends 2006 dividend: 2007 interim dividend: Euro 0,085 per share Euro 0,025 per share Detachment date: May 14th 2007 Detachment date: November 12th 2007 Payment date: May 17th 2007 Payment date: November 15th 2007 4,7%* 2006 dividend yield: 4,1%** Ascopiave 2006 dividend yield is highest regardi
Slide 40: Contents
CONTENTS Business Overview Strategy Financial highlights Dividends Annexes Page 40
Slide 41: Gas distribution: VRD breakdown
Gas distribution: VRD breakdown VRD (“Vincolo dei Ricavi della Distribuzione”, i.e. Distribution Revenue Constraint) Maximum cost of distribution activities, including VRD 06-07* €/M management operating costs, depreciation and CO 2006 13,735 remuneration of capital invested, that can be AMM 2006 7,
Slide 42: Issues on tariffs
Issues on tariffs Gas sales tariffs Exit of non domestic clients from the regulated market (AEEG Resolution no. 134/06) Review of the QVD of the sales tariff (AEEG Resolution No. 240/07) Gas distribution tariffs Review of the distribution tariff for the recalculation of the CGD component of the dist
Slide 43: Volumes of gas and electricity sold (2006 vs 2005)
Volumes of gas and electricity sold (2006 vs 2005) Volumes of gas sold Volumes of electricity sold (Milion of standard cubic meters) (GWh) ∆ = -50,6 ∆ = +63,6 Page 43
Slide 44: Revenues and EBITDA breakdown (2006 vs 2005)
Revenues and EBITDA breakdown (2006 vs 2005) Revenues breakdown (2006) EBITDA breakdown (Thousands of Euro) (Thousands of Euro) Total = 318.105 ∆ = -15.789 Page 44
Slide 45: EBITDA bridge (2006 vs 2005)
EBITDA bridge (2006 vs 2005) EBITDA bridge (Thousands of Euro) ∆ = -15.789 Change in gross margin on gas sales and distribution Page 45