Enel SpA · MIL:ENEL
Enel SpA — Debt Investor Presentation (September 2019)
41 slides from Enel SpA's debt investor presentation, September 2019
Slide 1: Investor presentation September 2019
Investor presentation September 2019
Slide 2: Disclaimer
Investor presentation Disclaimer This presentation contains certain forward-looking statements that reflect the Company’s management’s current views with respect to future events and financial and operational performance of the Company and its subsidiaries. These forward-looking statements are based
Slide 3: We are a leader in the new energy world
We are a leader in the new energy world 1st private network 73 mn end users operator1 43.4 GW capacity2 World’s largest private 46.4 GW capacity3 player2 in renewables 6.2 GW demand response Largest retail customer 70.4 mn customers4 base worldwide1 1. By number of customers. Publicly owned operator
Slide 4: Our business model is well diversified and provides long term visibility
Our business model is well diversified and provides long term visibility North & Central America Italy Iberia Rest of Europe 2% 30% 50% 4% 55% 0.7 €bn 7.1 €bn 19% 3.6 €bn 22% 0.5 €bn 32% 2% 100% 12% 46% 16% 10% 2018 Group EBITDA1 South America Africa, Asia & Oceania 46% 44% 10% 18% 4.4 €bn 16.2 €bn
Slide 5: Our EBITDA has a low exposure to merchant risk
Our EBITDA has a low exposure to merchant risk EBITDA exposure Regulated EBITDA by business 120% Regulated ~ 100% 100% Merchant 25/30% Regulated, contracted under long term 80% Retail portfolio hedge PPA, incentivized ~ 65% 60% Regulated ~ 45% 40% Regulated & 70/75% Regulated ~ 25% contracted 20% 0%
Slide 6: We delivered financial targets
We delivered financial targets 2018 2018 target 2017 ∆ YoY ✔ Ordinary EBITDA (€bn) 16.2 16.2 15.6 +4% ✔ Net ordinary income (€bn) 4.1 4.1 3.7 +9% ✔ Dividend per share (€) 0.28 0.28 0.237 +18% ✔ Net debt (€bn) 41.1 41-42 37.4 +10% ✔ FFO/Net debt 27% 26.5% 27% -% 6
Slide 7: The solid improvement in profitability, returns, and credit metrics
The solid improvement in profitability, returns, and credit metrics… Profitability Return on invested capital FFO/Net debt +600bps +60bps +200bps 0.35 14.0% 12.0% 30.0% 0.30 10.0% 25.0% 27% 0.25 8.0% 25% 8.8% 20.0% 25% 6.0% 8.2% 15.0% 0.20 19% 4.0% 10.0% 0.15 2.0% 7% 6.3% 5.0% 0.10 0.0% 0.0% 2015 20
Slide 8: …have been recognized by Rating Agencies
…have been recognized by Rating Agencies Enel’s LT rating Italy’s LT rating Rating Outlook Rating Outlook Strong track record of delivery. Global leadership in networks and renewables. Large share of regulated and quasi-regulated activities. Positioning at the A- Stable BBB Negative forefront of inn
Slide 9: Integrated model captures opportunities from energy transition
Integrated model captures opportunities from energy transition Growth across low carbon technologies and services SUSTAINABLE LONG TERM VALUE CREATION Operational improvement for a better service Engaging local communities ENERGY TRANSITION Engaging the people we work with Occupational Sound Environ
Slide 10: Our commitment on U.N. SDGs
Our commitment on U.N. SDGs Direct actions SUSTAINABLE 7 AFFORDABLE AND CLEAN ENERGY 13 CLIMATE ACTION 9 INDUSTRY INNOVATION AND INFRASTRUCTURE 11 CITIES AND COMMUNITIES Indirect contribution & behaviors 10
Slide 11: Our ability to reach the decarbonization target
Our ability to reach the decarbonization target1 A greener installed base… …thanks to growing execution capability Consolidated Capacity (GW) Additional renewables capacity2 (MW) >4 GW yr 89.7 85.6 85.8 3,000 3,100 2,018 930 932 1,000 924 Future growth 887 ambitions 37 39.2 39.4 344 382 2015 2018 H1
Slide 12: Enel's business model supports growth
Enel’s business model supports growth 19.0 Transition Switch to sustainable business Traditional business model year model 18.0 -1.7% CAGR +2.6% CAGR (2012-2015) (2015-2018) 17.0 16.2 16.5 16.5 15.6 16.2 16.0 15.2 15.8 15.0 15.2 15.0 15.5 15.0 15.0 14.0 13.0 2012 2014 2015 2016 2017 2018 EBITDA Targ
Slide 13: The offering
Investor presentation The offering
Slide 14: A market solution for sustainable finance
A market solution for sustainable finance The Path Ahead Enel’s Commitments Early adopter of the Green bond framework Expand the current reach Provide investors with more tools to deploy their and promoter of sustainable finance growth of sustainable finance capital towards the energy transition Str
Slide 15: The offering: General Purpose SDG Linked Bond
The offering: General Purpose SDG Linked Bond Issuer Enel Finance International NV Guarantor Enel SpA Expected Ratings Baa2/BBB+/A- (Moody’s / S&P / Fitch) Security Type Senior unsecured Size / Maturity $ Benchmark / 5-years Format 144A / RegS Denominations $200k x $1k Optional redemption Make-whole
Slide 16: H1 2019 delivery on key pillars
Investor presentation H1 2019 delivery on key pillars
Slide 17: Key highlights of the period
Key highlights of the period Ordinary Group net income +20% yoy Ordinary EBITDA reached 8.8 €bn (+13% yoy) Development capex increased by more than 30% yoy Efficiencies accelerated reaching c.200 €mn in the semester Exit from coal in Russia signed and approved by EGM Second swap on Enel Americas sha
Slide 18: Industrial growth: capex
Industrial growth: capex Development capex increasing by more than 30% yoy H1 2019 Capex by business and by nature H1 2019 Asset Development capex by business Capex addressed 3% 5% 2% by year1 1% 22% 7% 29% 2019E ~100% 41% 4.2 €bn 4.2 €bn 2.5 €bn 2020E ~100% (+23% yoy) 60% (+23% yoy) (+33% yoy) 18%
Slide 19: Group's infrastructure and services
Group’s infrastructure and services Infrastructure Customer services Electricity distributed (TWh) Smart meters 2.0 (mn) End users (mn) Free market power customers3 (mn) +7% >2.5x +0.3 +0.9 15.00 73.50 250.00 10.00 14.50 73.00 246.7 10.1 14.00 14.7 230.00 8.00 72.50 73.0 13.50 210.00 230.7 6.00 72.0
Slide 20: Operational efficiency
Operational efficiency Efficiencies accelerated reaching c.200 €mn in the semester Opex evolution1 (€mn) +1% -2% 206 36 84 (106) 4,316 4,216 4,244 (192) H1 2018 Perimeter & Other IFRS 16 H1 2018 Efficiency CPI & FX Develop. & H1 2019 pro forma Customers 1. Rounded figures 20
Slide 21: Portfolio management and simplification
Portfolio management and simplification Acceleration of decarbonisation strategy and minorities buyout Enel Russia Reftinskaya sale process Enel Americas simplification process 5% increase in ENIA shares c. 300 €mn sale price via first share swap Second share swap c. (75) €mn Recurring EBITDA transa
Slide 22: Progress on U.N. SDGs
Progress on U.N. SDGs SDG Sustainab le Dev. Goals Engaging local communities (mn beneficiaries)1 H1 2019 2030 High-quality, inclusive and fair education 1.1 2.5 Access to affordable and clean energy 7.1 10.0 Employment and sustainable and inclusive economic growth 2.0 8.0 Climate change H1 2019 2021
Slide 23: H1 2019 consolidated results
H1 2019 consolidated results Financial results
Slide 24: Financial highlights (€mn)
Financial highlights (€mn) H1 2019 H1 2018 ∆ YoY Ordinary EBITDA1 8,763 7,729 + 13% Ordinary Group net income2 2,277 1,892 + 20% FFO 4,922 4,361 + 13% Net debt 45,391 41,0893 + 10% Reported EBITDA 8,907 7,857 +13% Reported Group net income 2,215 2,020 + 10% 1. Excludes extraordinary items in H1 2018
Slide 25: Ordinary EBITDA evolution (€bn)
Ordinary EBITDA evolution1 (€bn) +13% increase in EBITDA in line with FY targets +13% Asset development driven by EGP and I&N 8.8 0.7 7.7 0.1 0.2 0.2 Increased customers number and improving margins 2.0 1.9 Efficiencies driven by conventional generation and I&N Positive regulatory changes in South A
Slide 26: H1 2019 Ordinary EBITDA by business line
H1 2019 Ordinary EBITDA by business line Performance supported by our integrated business model ∆ YoY 0.1 Higher prices and asset rotation +6% 1.6 3.9 Efficiencies, 8.81 €bn +11% Constructive regulatory changes & perimeter 0.8 (+13% yoy) Better free market margins and efficiencies +4% 2.3 Higher eff
Slide 27: Cash flow (€bn)
Cash flow (€bn) 23% increase in capex YoY covered by FFO generation1 10.0 9.0 8.0 8.8 ( 0.6 ) 7.0 6.0 ( 1.6 ) 5.0 ( 0.6 ) 4.0 ( 1.1 ) ( 4.2 ) 3.0 2.0 4.9 ( ) 1.0 - 0.8 Ordinary EBITDA ∆ Provisions 2 ∆Working Income Financial FFO 4 Capex FCF capital taxes expenses 3 & other PY 7.7 (0.7) (0.9) (0.5) (
Slide 28: FY 2018 consolidated results
FY 2018 consolidated results Financial results
Slide 29: Financial highlights (€mn)
Financial highlights (€mn) FY 2018 FY 2017 ∆ yoy Net of FX4 Revenues 75,672 74,639 +1% Reported EBITDA 16,351 15,653 +4% Ordinary EBITDA1 16,158 15,555 +4% +7% Reported EBIT 9,900 9,792 +1% Ordinary EBIT 9,793 9,736 +1% Reported Group net income 4,789 3,779 +27% Group net ordinary income2 4,060 3,70
Slide 30: Ordinary EBITDA evolution (€bn)
Ordinary EBITDA evolution (€bn) 20.00 EBITDA evolution1 (€ bn) € mn 19.00 18.00 +4% Growth in renewables and networks 1,000 Efficiency 315 17.00 16.00 16.2 Perimeter and One-offs2 20 15.00 15.6 14.00 FX3 (470) 13.00 Scenario and margins (265) 12.00 FY 2017 FY 2018 1. Rounded figures. 30 2. FY 2017 i
Slide 31: FY 2018 Ordinary EBITDA by business line
FY 2018 Ordinary EBITDA by business line ∆ YoY Performance driven by growth and +12% volume/prices 2.9 7.6 Growth and efficiencies +3% 1.1 16.21 €bn Higher margins across all markets +20% 4.5 0.1 Focus on new infrastructures and services - Networks Enel X Renewables Normalization of market environme
Slide 32: From Ordinary EBITDA to Net Ordinary Income
From Ordinary EBITDA to Net Ordinary Income (6.4) 16.2 (2.3) (1.9) 9.8 (1.6) 7.5 4.1 Ordinary D&A EBIT Financial EBT Income Minorities Group EBITDA expenses taxes net ordinary & other 1 income PY 15.6 (5.8) 9.7 (2.7) 7.1 (1.9) (1.5) 3.7 Delta YoY +4% +9% +1% -14% +6% -% +5% +9% 1. Includes other fin
Slide 33: Cash flow (€bn)
Cash flow (€bn) (1.9) 18.0 16.0 1.1 (1.7) 14.0 16.2 (2.6) 12.0 (8.5) 10.0 11.1 8.0 6.0 4.0 0.7 ( ) 3.3 2.0 - 1 4 Ordinary EBITDA ∆ Provisions ∆Working Income Financial FFO 3 Capex Build & sell FCF capital taxes expenses 2 & other PY 15.6 (1.7) (0.5) (1.6) (1.7) 10.1 (8.5) 0.8 2.4 Delta YoY +4% +10%
Slide 34: Liabilities structure
Investor presentation Liabilities structure
Slide 35: Debt (€bn)
Debt (€bn) Cost of gross debt declined 30bps vs. PY, Net Debt increase due to IFRS16 and Active Portfolio Management Gross debt Net debt evolution +3% 50 48 0.4 46 1.1 57.4 59.3 2.2 60 44 42.5 45.4 6.7 5.8 50 8.1 42 IFRS 16 1.4 8.2 40 ( 0.8 ) IFRS 16 40 1.4 37,302 43,122 43,122 38 30 37,410 36 45.4
Slide 36: Debt maturity coverage split by typology
1H 2019 consolidated results Debt maturity coverage split by typology (€bn) 33.1 6.5 20.8 Available committed credit lines1 15.0 26.6 5.9 6.8 5.8 1.0 4.4 4.0 3.7 1.1 Cash 5.8 Short Term 2.1 1.9 4.7 5.8 Bank Loans and Others 1.2 1.9 1.8 0.3 Bonds 1H 2019 2019 2020 2021 2022 2023 After 2023 1. Of whic
Slide 37: H1 2019: liquidity position (€bn)
H1 2019: liquidity position (€bn) Amount as of Available Outstanding Available June 30, 2019 Dec. 2018 Committed credit lines 16.2 1.2 15 14.5 of which long term committed credit lines (beyond - 14.4 13.8 June 2020) Enel Spa 6.3 0.5 5.8 EFI 5.0 - 5.0 Iberia 2.1 - 2.1 Latam 1.6 0.3 1.3 Other 1.2 0.4
Slide 38: H1 2019: debt maturity profile (€mn)
H1 2019: debt maturity profile (€mn) Enel 2019 2020 2021 2022 2023 After 2023 Bond 147 1,552 1,196 4,114 5,207 23,021 Bank Loans - 650 400 1 - - 1 Other Loans 1 1 - - - - Short term Debt 1,758 - - - - - Total 1,906 2,203 1,596 4,115 5,207 23,020 Iberia 2018 2019 2020 2021 2022 After 2022 Bond 15 - -
Slide 39: H1 2019: gross debt structure
H1 2019: gross debt1 structure Long term debt by currency After swap Interest rate composition 47% 80% 22% 55.8 €bn 2% 55.8 €bn 60.2 €bn 7% 3% 1% 78% 3% 34% 3% 7% 1% 5% 7% EUR USD BRL CLP Floating Fixed + Hedged EUR USD BRL CLP COP Other COP Other GBP 1. In nominal terms 39
Slide 40: Debt structure by instrument (€bn)
H1 2019 consolidated results Debt structure by instrument (€bn) EFA and North & Europe and Euro- South Africa, Asia Debt by instrument Enel Spa EFI Central Italy Iberia Central Mediterranean Total America and Oceania Others America Affairs Bonds 8.52 26.72 - - 0.04 5.77 - 0.07 - 41.12 Bank Loans 1.0
Slide 41: Contact us
Contact us Contacts Email investor.relations@enel.com Phone +39 06 8305 7975 Monica Girardi Channels Head of Group Investor Relations Website Mobile App Investor Relations team Enel.com Enel Investors Federico Baroncelli Francisco Basauri Serena Carioti Alessia Di Ninno Follow us Federica Dori Fabri