Slide 1: Endesa 1H 2018 Results
Endesa 1H 2018 Results 24/07/2018
Slide 2: Highlights
Highlights Sound performance of the liberalized business EBITDA (+42%) in a context of gradual normalization of market conditions Stable contribution of regulated businesses Overall EBITDA increased by 12% in the period Flat fixed costs evolution absorbing inflation and growth Strong Net Income grow
Slide 3: Financial results
Financial results €M 1H 2018 1H 2017 Change Revenues 9,934 10,004 -1% Gross Margin 2,823 2,624 8% EBITDA 1,804 1,605 12% EBIT 1,053 901 17% Net attributable (1) income 752 653 15% (1) Net Capex 460 288 60% Cash Flow from Operations 639 675 -5% 30.06.2018 31.12.2017 Net financial debt 5,956 4,985 19%
Slide 4: EU energy policy targets
EU energy policy targets Energy Transition: decarbonization of economy 2030 UE energy policy targets(1) Endesa’s strategic vision for Spain MtCO2eq 452 40% Reduction vs 1990 217 275 2030 vs 2005 CO2 emissions ETS 112 -48% 43% ETS sectors vs 2005 235 163 30% Non ETS sectors vs 2005 (Spain 26%)
Slide 5: Delivery on industrial strategic pillars
Delivery on industrial strategic pillars As of 1H 2018 Customer focus Smart grids Generation mix Maximized customer Smart networks and Decarbonization and value and leadership with best-in-class operations security of supply Endesa X Integrated margin +19% Organic and inorganic growth Endesa X margi
Slide 6: Growth in Renewables and Networks
Growth in Renewables and Networks As of 1H 2018 Organic Inorganic Spanish auctions 2017 Gestinver 3 wind farms: 57.5 MW 2 wind farms: 540 MW Wind and 339 MW PV 74 MW Renewables 132 MW Wind Investment: €870 M Investment: ~ €170 M Equity IRR >11% Ebitda 2019e ~€20 M (~€4 M 1H2018) Public o
Slide 7: Digital Transformation
Digital Transformation As of 1H 2018 main outcome CLIENTS 4.1 M digital customers (+0.3M vs 2017) 2.4 M contracts with e-billing system (+0.3M vs 2017) 18% increase on digital sales vs 2017 79% e-care interactions (+10% vs 2017) ASSETS 11.6 M smart meters installed (97% of the delivery poi
Slide 8: Efficiency
Efficiency Fixed costs evolution KPI’s evolution and degree of fulfilment 2020 target Distribution Unitary cost (3) (1) (€/customer) -8% 1H2017 1.0b€ 49 41 45 45 2016 2017 1H2018 CPI 12 M€ Unitary cost (3) Generation (k€/MW) - 48 47 47 47 Growth 3 M€ 2016 2017 1H2018 EGPE Unitary cost(3) (k€/MW) Eff
Slide 9: Market context in 1H 2018
Market context in 1H 2018 Demand (1) Electricity wholesale prices Average pool prices Spain (€/MWh) Spain(2) Endesa distribution area(3) -2% (Not adjusted) 1.1% 1.2% Industry -3.4% 51.3 48.1 52.0 50.1 0.3% Services +1.0% Residential +1.5% 1H 2017 1Q 2018 2Q 2018 1H 2018 -0.2% Adjusted for weather an
Slide 10: Endesa's performance in 1H 2018 market context
Endesa’s performance in 1H 2018 market context Power operational highlights (1) (1) Output (GWh) Electricity sales (GWh) Number of electricity customers (thous.) -7% -6% 0% 52,474 37,678 34,868 49,168 10,848 10,802 7,767 6,263 7,256 1,814 6,096 9,602 2,115 9,738 5,255 5,133 -2% 13,414 9,681 35,105 3
Slide 11: Liberalized business
Liberalized business Energy management Energy (TWh) Unitary values breakdown (€/MWh) -6% (1) Sales 43.2 64.5 40.6 60.1 +1% Unitary revenue Energy purchases 11.8 11.9 -9% 39.1 Unitary variable cost(2) 38.7 Mainland output 31.4 28.7 Unitary margin 21.4 +19% 25.4 1H 2017 1H 2018 1H 2017 1H 2018 Sound
Slide 12: Endesa's performance in 1H 2018 market context
Endesa’s performance in 1H 2018 market context Gas operational highlights Sales (GWh) Number of gas customers (thous.) -2% 0% 50,043 49,272 1,560 1,562 3,750 4,608 5,638 5,928 246 237 Unitary margin (1): 1H 2017 1H 2018 €0.8/MWh €1.1/MWh 40,655 38,736 1,314 1,325 YTD Demand increase: 5.8% 1H 2017 1H
Slide 13: Gross margin evolution
Gross margin evolution Gross margin net of one offs +8% % Chg. % Chg. +7% Margin Margin €M 2,624 2,629 2,823 2,823 Reported Adjusted 5 62 135 - 3- 1,227 1,227 +19% +12% 1,035 1,092 One offs 1H17 Gx+Sx 365 313 310 310 -15% -1% MtM gas&others : -€77 M SCVP: €20 M Non mainland Gx Settlements: €52 M 1,2
Slide 14: Regulated business
Regulated business Gross margin evolution 0% €M +4% (1) 1,589 1,537 62 1,596 1,596 -3 365 310 310 Non-mainland Gx 313 Dx 1,224 1,224 1,286 1,286 Reported 1H Adjusted 1H Dx Non-mainland Adjusted 1H Reported 1H 2017 2017 Gx 2018 2018 Regulated gross margin driven by Distribution regulated revenues 1
Slide 15: Liberalized business
Liberalized business(1) Gross margin evolution +19% €M +12% (2) 30 3 1,227 1,227 1,035 1,092 102 57 65 57 65 54 54 35 EGPE: 135 EGPE: 132 1,023 1,105 1,105 1,003 -42 Reported 1H 2017 Adjusted 1H 2017 Electricity + Others Gas Endesa X Adjusted 1H 2018 Reported 1H 2018 Electricity and others Gas Endes
Slide 16: Fixed costs evolution
Fixed costs evolution 0% €M 0%(1)(2) 1,019 3 (1) 1,016 1,012 1,019 7 (2) Personnel 451 460 455 473 -1% costs 0% O&M costs 647 635 637 626 Capitalized costs -79 -79 -80 -80 1H 2017 1H 2017 1H 2018 1H 2018 Reported Adjusted Adjusted Reported Flat fixed costs evolution absorbing inflation and growth
Slide 17: EBITDA evolution
EBITDA evolution EBITDA net of one offs +12% % Chg. % Chg. +12% Ebitda Ebitda €M 1,804 1,804 Reported Adj 1,605 5 1,610 76 126 -8 EGPE: 93 616 616 +42% +26% 433 490 EGPE: 96 (Gestinver ~€4 M) 236 One offs 1H17 176 176 -25% -4% 184 Gx+Sx MtM gas&others : -€77 M SCVP: €20 M Non mainland Gx 1,012 1,012
Slide 18: From EBITDA to Net Income
From EBITDA to Net Income €M (1) -751 -70 +1 1,804 -228 -4 1,053 984 752 EBITDA Depreciation EBIT Net Financial Associates Profit before Taxes Minorities Net and Results and Others taxes attributable amortization Income 11% (2) 1H 2017 1,605 -704 901 -59 6 848 -190 -5 653 Change (%) +12% +7% +17% +1
Slide 19: Net financial debt analysis
Net financial debt analysis Net debt / 1.4x 1.6x EBITDA ratio 5,956 €M 4,985 Regulatory working 748 742 capital (2) Regulatory working 530 - 639 862 capital 5,214 4,455 FY 2017 Cash flow from Capex(1)(€621 M€) Dividends 1H 2018 operations + Others(3) Cash Flow from Operations stabilizing as expect
Slide 20: Gross financial debt structure
Gross financial debt structure as of 1H 2018 Gross and net debt Structure of Endesa's gross debt €M 6,843 887 6,843 6,843 5,392 407 Floating 48% 5,956 Euro 100% 4,985 Fixed 52% FY 2017 1H 2018 By interest rate By currency Net debt Cash & Derivatives recognized as financial assets Average cost of d
Slide 21: Final Remarks
Final Remarks Continuous delivery on strategic plan and fully committed with the Energy Transition initiatives Strong EBITDA evolution supported by the very good performance of our liberalized business Constant effort on fixed cost contention Sound bottom line figure Well on track to meet 2018 guida
Slide 22: Appendix
Appendix Endesa 1H 2018 Results 22
Slide 23: Endesa: financial debt maturity calendar
Endesa: financial debt maturity calendar Gross balance of maturities outstanding at 30 June 2018: €6,843 M(1) Bonds and other marketable securities (2) Bank Debt Other debts 4,530 3,391 Endesa's liquidity covers 41 1,249 32 months of 8 43 791 debt maturities 1,200 1,120 55 16 114 733 33 152 58 119 1
Slide 24: Installed capacity and output
Installed capacity and output Total output(1) (GWh) Total output (GWh) -7% GWh 1H 2018 (and chg. vs. 1H 2017) Total Output (1) 37,678 34,868 Total 34,868 -7% Hydro 5,207 68% 6,263 6,096 Nuclear 11,769 -10% 3,052 1,753 Coal 9,080 -22% 6,573 6,238 Natural gas 3,466 -26% 3,789 1,690 Oil-gas 3,231 -4% 1
Slide 25: Endesa: 1H 2018 P&L
Endesa: 1H 2018 P&L Gx+Sx Dx Structure Adjustments TOTAL Income 8,649 1,387 275 -377 9,934 Procurements and services -7,058 -101 -41 89 -7,111 Gross margin 1,591 1,286 234 -288 2,823 Self-constructed assets 17 57 6 0 80 Personnel expenses -269 -125 -83 4 -473 Other fixed operating expenses -544 -206
Slide 26: Endesa: 1H 2017 P&L
Endesa: 1H 2017 P&L Gx+Sx Dx Structure Adjustments TOTAL Income 8,818 1,290 261 -365 10,004 Procurements and services -7,363 -66 -38 87 -7,380 Gross margin 1,455 1,224 223 -278 2,624 Self-constructed assets 11 60 8 0 79 Personnel expenses -236 -133 -90 8 -451 Other fixed operating expenses -532 -215
Slide 27: Glossary of terms (I/II)
Glossary of terms (I/II) Reference note (#) of Consolidated Item Calculation Management Report (Cost of gross financial debt) / gross average financial debt: €64 M x (365/180) / €6,335 M = Average cost of debt (%) 1.3.3 2.0% (Principal x number of days of term) / (Principal in force at the end of th
Slide 28: Glossary of terms (II/II)
Glossary of terms (II/II) Reference note (#) of Consolidated Item Calculation Management Report Long and short term financial debt (€5,556 M + €1,287 M) - Cash and cash equivalents (€880 M) Net financial debt (€M) 4.1 – Derivatives recognized as financial assets (€7 M) = €5,956 M Net financial resul
Slide 29: Disclaimer
Disclaimer This document contains certain "forward-looking" statements regarding anticipated financial and operating results and statistics and other future events. These statements are not guarantees of future performance and they are subject to material risks, uncertainties, changes and other fact