Enel Spa · MIL:ENEL
Enel Spa — H1 2022 Earnings Presentation
56 slides from Enel Spa's earnings presentation, Jul 28, 2022
Slide 1: H1 2022 Consolidated results
H1 2022 Consolidated results July 28th, 2022
Slide 2: First Half 2022 Consolidated results
First Half 2022 Consolidated results Francesco Starace CEO
Slide 3: Key highlights
Key highlights Business Energy crisis in Financial Simplification performance Europe performance Renewables development in line Challenging Strong liquidity with targets market context position Exit from Russia Investments protected Temporary Limited at final stages from inflation dynamics squeeze i
Slide 4: Turbulence in energy market had no impact on our developing machine
Business performance Turbulence in energy market had no impact on our developing machine Total capacity evolution1 (GW) 56% RES on total 60% 68% On track to deliver 6,000 MW in 2022, of which more than half in US and Brazil 0.4 55.4 0.5 >60% of 2022-24 target additions 49.9 5.1 already addressed 1.3
Slide 5: Investments in networks and renewables protected against inflation
Business performance Investments in networks and renewables protected against inflation Inflation adjustments in Investments (€bn) Renewables networks Yearly adjustment on +9% 2022-24 capacity opex and RAB in execution1 (GW) ~13 Updated at the beginning of regulatory period c.60% supply secured, 2.4
Slide 6: A successful and customer oriented commercial offering accelerates our strategic targets
Business performance A successful and customer oriented commercial offering accelerates our strategic targets Free market customers (mn) Free market volumes1 (TWh) +7.3 (+10%) +2.5 (+16%) 30.0 0 100 .00 vs PY 25.0 0 vs PY 77.8 70.5 80.0 0 20.0 0 17.9 15.4 20.0 15.0 0 B2C 60.0 0 18.0 B2C 10.0 0 15.4
Slide 7: Resilient performance in Latam on a post pandemic recovery
Business performance Resilient performance in Latam on a post pandemic recovery Latam Brazilian Networks Positive regulatory frameworks EBITDA (€bn) EBITDA (€bn) Enel Dx Sao Paulo 3.00 +25% 0.80 +47% Tariff increase approved end of June, applicable since July 4th, 2022 (c.+12%) 0.70 2.50 2.5 0.60 0.
Slide 8: H1 2022 sees full impact from energy turbulences in Europe
Energy crisis in Europe H1 2022 sees full impact from energy turbulences in Europe… TTF (€/MWh) Average pool prices (€/MWh) 4.4x 3.7x Tensions on commodities 95.6 250.0 21.6 Italy 67.0 transferred on H1 2021 H1 2022 H1 2021 H1 2022 electricity markets, CO2 (€/ton) driving spot prices to unprecedente
Slide 9: Downside in the integrated margin, mainly in Italy
Energy crisis in Europe …which translated into a downside in the integrated margin, mainly in Italy… Integrated margin management (€bn) Turbulences impact Focus on Italy (€bn) concentrated in Italy translating into a 1.0 1.0 hit to the country 0.5 0.2 integrated margin 4.9 Turbulences Portfolio opti
Slide 10: Clients remained protected throughout the turbulences and sales were higher than expected
Energy crisis in Europe …where clients remained protected throughout the turbulences and sales were higher than expected Free market dynamics in Italy Avg. sales price (€/MWh) Sales (TWh) Retail contracts have been locked in during COVID-19 outbreak 300 50. 00 +5 TWh 45. 00 250 33 38 Our clients ben
Slide 11: Lower share of renewables on higher sales pushed up unitary cost
Energy crisis in Europe Lower share of renewables on higher sales pushed up unitary cost Fixed price sales1 (TWh) Hydro production (TWh) 7 TWh unexpected open position 25 ~3 TWh + ~4 TWh = ~7 on higher sales (c.+3 TWh) 23 14 TWh and hydro scarcity (c.-4 TWh) 21 12 19 17 19 10 Cost of sourcing up by
Slide 12: Our integrated position will rebalance in forthcoming quarters
Energy crisis in Europe Our integrated position will rebalance in forthcoming quarters Integrated margin management (€bn) Turbulences impact 100% contracts 100% sourcing partially offset, already repriced costs hedged in H1 2022 already, 0.8 - 1.3 by portfolio optimization +13% yoy Visibility on 4.5
Slide 13: Accelerating Group's repositioning in core countries
Simplification Accelerating Group’s repositioning in core countries 2023 H1 2022 H2 2022 onwards Sale of the 56.43% stake in Disposal of the transmission assets Enel Russia for a total in Chile for a consideration consideration of c.137 €mn of around 1.3 USDbn 630 €mn positive impact on Closing expe
Slide 14: 2022 guidance fully confirmed
2022 guidance fully confirmed Our Ordinary sustainable EBITDA (€bn) 19.0 – 19.6 and integrated business Net Ordinary 5.6 – 5.8 model Income (€bn) delivering results amidst distressed DPS (€/sh) 0.40 environment
Slide 15: First Half 2022 Financial results
First Half 2022 Financial results Alberto De Paoli CFO
Slide 16: Key financial highlights
Key financial highlights Business Energy crisis in Financial performance Europe performance +450 €mn -5 TWh hydro Around 26 €bn renewable growth production yoy in available liquidity +500 €mn EBITDA Italy and Spain in Latam Cost of debt at Peaking commodity 3.4%, down by 10 +270 €mn prices hit sourc
Slide 17: Positive business performance offset energy crisis impact in Europe
Positive business performance offset energy crisis impact in Europe EBITDA evolution1 (€bn) -2% • Regulation and efficiencies in Latam more than offset WACC reset in Italy • 450 €mn renewables growth and higher prices 0.1 • 270 €mn efficiencies 0.3 (0.1) • 200 €mn FX impact (1.0) 8.4 0.5 - 8.3 • 1 €
Slide 18: Infrastructure and Networks
Infrastructure and Networks EBITDA evolution1 (€bn) +3% Strong performance in Latam driven by regulatory adjustments, efficiencies and supported by FX revaluation (0.07) (0.07) 0.3 Stable results in Europe despite (0.11) WACC reset in Italy 3.6 3.7 Romania still affected by negative regulatory actio
Slide 19: Global Power Generation & Enel X Global Retail
Global Power Generation & Enel X Global Retail EBITDA evolution1 (€bn) -4% Unexpected 7 TWh open position weighing on the Italian performance Iberia benefitted from portfolio 0.26 (0.1) management optimization, (0.76) RoE still affected by Romanian 4.9 government’s adverse measures 0.18 4.7 0.24 (0.
Slide 20: Efficiencies across all businesses offset CPI increase
Efficiencies across all businesses offset CPI increase Opex evolution1 (€bn) Efficiencies by business1 +8% 5.0 4.5 9% 18% 4.0 (0.3) 0.1 4.1 3.8 0.1 0.3 3.5 27% H1 2022 3.0 0.3 €bn 2.5 2.0 1.5 46% 1.0 H1 2021 Development Efficiencies CPI FX H1 2022 & Customers 19 1. Rounded figures.
Slide 21: Net Income
Net Income Net Ordinary Income evolution (€bn) -8% D&A increase driven by higher investments deployed and FX impact 2.5 0.3 0.0 2.0 2.3 (0.1) 0.1 Bad debt level equal to 1.4% 2.1 on revenues in line with (0.5) historical trend 1.5 1.0 0.5 Windfall Tax in Italy 0.0 impacting for 50 €mn H1 2021 EBITDA
Slide 22: FY2022 EBITDA guidance
FY2022 EBITDA guidance EBITDA evolution to FY2022 (€bn) Total EBITDA (€bn) FY 2022 GUIDANCE H1 ‘22 FY ’22E • 1.3 €bn re-pricing • 0.8 €bn res contribution Networks 3.7 ~8 2.2 0.3 19.0-19.6 0.5 Integrated margin 4.4 ~11 management 8.0 Stewardship 0.3 ~0.5 Total2 8.3 19.0-19.6 8.3 H1 2022 H2 2022 Netw
Slide 23: H1 FFO contribution turned positive vis-à-vis Q1
H1 FFO contribution turned positive vis-à-vis Q1 Cash flow (€bn) WC temporary impacts evolution (€bn) Q1 ‘22 H1 ’22 9.0 - Capex 8.0 (1.7) (1.1) 8.3 seasonality (3.4) 7.0 6.0 Energy market 5.0 (1.4) (1.4) 4.0 (1.8) context 3.0 ( 5.2 ) Government (0.9) 2.0 ( 1.1 ) (0.5) 1.0 ( 1.2 ) measures - 0.8 Ordi
Slide 24: FY2022 FFO guidance
FY2022 FFO guidance FFO evolution to FY2022 (€bn) WC evolution (€bn) H1 ‘22 FY ’22 FY 2022 GUIDANCE Capex (1.1) - seasonality Temporary Energy market (1.0) EBITDA (1.4) context conversion ~3.0 ~11 Government @65% (0.9) (0.9) measures NWC (1.8) (0.4) management 7.2 Total (5.2) (2.3) 0.8 H1 FFO H2 FFO
Slide 25: Net Debt
Net Debt Net debt evolution (€bn) Net Debt Adjusted 2.4 0.4 2.2 5.9 ~58 62.2 (2.6) Government (1.9) 2.6 measures 52.0 (0.8) Accounting effects 1 Dec. 31, '21 FFO Capex Dividends APM FX Jun. 30, '22 Leasing FX Jun. 30, '22 paid Net Debt @hedges Net Debt Reported Adjusted 1. It includes foreign exchan
Slide 26: FY2022 Net Debt guidance
FY2022 Net Debt guidance Net debt evolution to FY2022 (€bn) 2.6 FY 2022 GUIDANCE - ~61 Government ~5 2.6 measures 52.0 ~15 (~11) FY 2021 FFO Capex Dividends APM, FX and FY 2022E Leases 25
Slide 27: Solid and ample liquidity protects against market volatility
Solid and ample liquidity protects against market volatility Liquidity position Long Term debt maturities (€bn) 19.0 17.0 14.5 2022-24 Maturities 16.4 €bn 15.0 6.6 13.0 4.6 9.3 11.0 25.9 €bn 9.0 7.0 2.6 19.3 5.0 4.1 9.9 3.0 1.3 6.7 0.6 3.0 1.0 2.4 2.8 -1.0 2022 2023 2024 2025-2026 Available Cash com
Slide 28: First Half 2022 Closing remarks
First Half 2022 Closing remarks
Slide 29: Closing remarks
Closing remarks Business underlying An integrated No risks to extremely business model A strong our guidance supportive offsetting financial and to medium and extreme energy position dividend long term scenarios policy targets
Slide 30: Annexes
First Half 2022 Consolidated results Annexes
Slide 31: Macroscenario
H1 2022 consolidated results Macroscenario GDP (%) CPI (%) FX against €1 Spot Price (€/MWh) Electricity Demand (TWh) 2 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 Italy 5.43 8.80 6.70 0.97 - - 249.09 66.96 158.02 154.86 Iberia 6.22 6.85 8.40 1.40 - - 205.94 58.23
Slide 32: Group consolidated net capacity by technology and geography
H1 2022 consolidated results Group consolidated net capacity: breakdown by technology and geography Solar & MW Hydro Wind Geothermal Nuke Oil & Gas Coal CCGT TOTAL Other Italy 12,991 794 774 29 - 2,248 4,720 4,596 26,151 Iberia 4,746 2,602 - 1,160 3,328 2,333 1,644 5,445 21,259 Latin America 10,542
Slide 33: Group consolidated net production by technology and geography
H1 2022 consolidated results Group consolidated net production: breakdown by technology and geography Solar & GWh Hydro Wind Geothermal Nuke Oil & Gas Coal CCGT TOTAL Other Italy 5,705 722 2,716 34 - 46 8,262 5,583 23,067 Iberia 2,480 2,832 - 904 13,447 2,082 697 8,698 31,140 Latin America 16,011 5,
Slide 34: Group total additional capacity by technology and geography
H1 2022 consolidated results Group total additional capacity1: breakdown by technology and geography Solar & MW Hydro Wind Geothermal Nuke Oil & Gas Coal CCGT TOTAL Other Italy 547 - - - - - - - 547 Iberia 5 56 - 62 - - - - 124 Latin America 1 264 - 252 - 3 - - 519 Argentina - - - - - - - - - Brazil
Slide 35: Renewable projects in execution by technology and geography
H1 2022 consolidated results Renewable projects in execution: breakdown by technology and geography1 Solar & MW Wind Hydro Geothermal BESS Total Other Italy 98 19 3 339 1,734 2,193 Iberia 259 20 - 1,625 25 1,928 Latin America 1,824 159 - 1,955 78 4,016 Rest of Europe - - - 158 - 158 North America 90
Slide 36: Renewables pipeline
H1 2022 consolidated results Pipeline Renewables Pipeline (GW) 2022-24 Additional capacity target2 Capacity in execution Built ~64 13.3 capacity 1.3 ~223 23 GW +29 GW ~402 vs PY 8.4 Residual target ~102 13.3 2022 target in execution 100% Gross Pipeline BESS 1 Early stage Mature In execution 2023 tar
Slide 37: EGP mature pipeline
H1 2022 consolidated results EGP mature pipeline1 By technology By geography By COD 4% 12% 12% 4% 9% 9% 21% 36% ~102 GW ~102 GW ~102 GW 60% 24% 34% 75% Wind Italy North America 2023 Solar Iberia Rest of Europe 2024 Hydro & Others Latin America Africa, Asia & Oceania >2024 1. Excludes BESS mature pip
Slide 38: Infrastructure & Networks KPIs
H1 2022 consolidated results Infrastructure & Networks KPIs Electricity distributed1 (TWh) Grid customers (mn) Smart meters (mn)1 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 Italy 110.3 110.0 31.7 31.5 31.1 30.8 Iberia 66.1 64.3 12.4 12.3 12.5 12.5 Latin America 68.5 67.3 28.5 27.9 0.5 0.4 Argen
Slide 39: Retail KPIs
H1 2022 consolidated results Retail KPIs Power Gas Customers (mn) Volumes1 (TWh) Customers (mn) Volumes (bscm) H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 Italy 21.6 22.2 47.7 45.5 4.4 4.1 2.9 2.5 Iberia 10.5 10.2 38.5 39.4 1.8 1.7 2.9 2.8 Latin America 28.5 27.9 66.4 62.9 0.0 0.
Slide 40: Enel X KPIs
H1 2022 consolidated results Enel X KPIs Charging Points1,2 (k) Street lighting (mn) Electric buses2 (#) Storage BTM (MW) Demand Response (GW) H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 Italy 46.7 32.3 1.5 1.6 31 - - - 0.6 0.8 Iberia 11.1 8.0 0.1 0.1 202 31 - - -
Slide 41: Baseload power price & production sold forward
H1 2022 consolidated results Baseload power price & production sold forward Baseload price 2022 2023 2024 Italy (€/MWh) 88.1 78.9 75.0 Iberia (€/MWh) 82.9 69.4 59.0 Production sold forward 2022 2023 2024 price % price % price % 1 Italy (€/MWh) 63.2 100% 85.8 51% 75.6 12% Iberia (€/MWh)1 65.0 100% 65
Slide 42: Capex
H1 2022 consolidated results Capex1 (€mn) Conventional Generation & Infrastructure Services EGP Retail Enel X Total Global Trading & Networks & Other H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 Italy 170 97 1,104 1,088 392 160 258 1
Slide 43: Asset development Capex
H1 2022 consolidated results Asset development Capex1 (€mn) Conventional Generation & Infrastructure Services EGP Retail Enel X Total Global Trading & Networks & Other H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 Italy 135 66 541 568
Slide 44: Revenues
H1 2022 consolidated results Revenues1 (€mn) Conventional Generation & Infrastructure Services EGP Retail Enel X 2 Total Global Trading & Networks & Other H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 Italy 26,622 10,036 3,431 3,551 9
Slide 45: Reported EBITDA
H1 2022 consolidated results Reported EBITDA1 (€mn) Global Generation Global Infrastructures Holding, Services Enel Green Power Retail Enel X Total & Trading & Networks & Other2 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 Italy 1,55
Slide 46: Ordinary EBITDA
H1 2022 consolidated results Ordinary EBITDA1 (€mn) Conventional Generation & Infrastructure Services EGP Retail Enel X Total Global Trading & Networks & Other 2 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 Italy 1,555 357 1,752 1,80
Slide 47: Reported EBIT
H1 2022 consolidated results Reported EBIT1 (€mn) Conventional Generation & Infrastructure Services EGP Retail Enel X Total Global Trading & Networks & Other H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 H1 2022 H1 2021 Italy 1,478 195 1,075 924 (533
Slide 48: From EBITDA to net income
H1 2022 consolidated results From EBITDA to net income1 (€mn) H1 2022 H1 2021 H1 2022 H1 2021 ∆ yoy ∆ yoy reported reported ordinary ordinary EBITDA 8,205 7,795 5.3% 8,298 8,436 -1.6% D&A (4,303) (3,348) (3,671) (3,162) EBIT 3,902 4,447 -12.3% 4,627 5,274 -12.3% Net financial charges (1,020) (1,137)
Slide 49: D&A reported
H1 2022 consolidated results D&A reported (€mn) 1 0 H1 2022 H1 2021 ∆ yoy Generation and Trading 1,038 471 120% Enel Green Power 751 790 -5% Distribution 1,492 1,299 15% Retail 766 587 31% Enel X 109 83 31% Others and adjustments 147 118 25% Total 4,303 3,348 29% 48
Slide 50: Gross debt structure
H1 2022 consolidated results Gross debt1 structure Long-term debt By currency Interest rate Long term by currency After swap composition credit ratings 52% 30% Rating Outlook 84% S&P BBB+ Stable 67.6 €bn 1% 67.6 €bn 80.5 €bn 7% 2% Moody’s Baa1 Stable 1% 5% 2% 2% 3 7% 1% 33% 70% Fitch BBB+ Stable EUR
Slide 51: Debt structure by instrument
H1 2022 consolidated results Debt structure by instrument (€bn) EGP SpA and Latin Africa, Asia and Debt by instrument Enel Spa EFI Italy Iberia North America Europe Total Central America Oceania Others Bonds 4.45 40.47 - - 0.01 5.12 - - 0.06 50.11 Bank Loans 1.53 - 0.27 3.61 4.51 2.88 0.33 - 0.38 13
Slide 52: Debt maturity coverage split by typology
H1 2022 consolidated results Debt maturity coverage split by typology (€bn) Available liquidity 36.0 7.7 6.6 25.9 €bn 15.9 28.3 19.3 9.3 8.3 12.9 2.6 6.2 2.9 Short Term 4.1 1.7 Bank Loans and Others 0.6 1.3 6.7 5.4 Available committed 2.4 2.8 4.5 Bonds credit lines1 2022 2023 2024 2025 2026 After 20
Slide 53: Balance sheet
H1 2022 consolidated results Balance sheet (€mn) H1 2022 FY 2021 Δ Net financial debt 62,238 51,952 19.8% Shareholders' equity 45,783 42,342 8.1% Net capital employed 108,021 94,294 14.6% 52
Slide 54: Headcount
H1 2022 consolidated results Headcount 1 H1 2022 FY 2021 ∆ yoy Generation and Trading 7,787 7,847 -1% Enel Green Pow er 9,572 8,989 6% Distribution 33,369 33,263 0% Retail 6,158 6,148 0% Enel X 2,938 3,352 -12% Others and adjustm ents 7,293 6,680 9% Total 67,117 66,279 1% 53
Slide 55: Disclaimer
H1 2022 consolidated results 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 ar
Slide 56: Contact us
H1 2022 consolidated results Contact us Contacts Email investor.relations@enel.com Phone +39 06 8305 7975 Investor Relations App Monica Girardi iOS Android Head of Group Investor Relations Investor Relations team Federico Baroncelli Serena Carioti Federica Dori Federica Pozzi Fabrizio Ragnacci Chann