Slide 1: Endesa FY 2017 Results
Endesa FY 2017 Results 28/02/2018
Slide 2: Agenda: Highlights and key financial figures
1. Highlights and key financial figures 2. Endesa’s performance in 2017 market context 3. Financial results 4. Final remarks FY 2017 Results- Madrid, 28 Feb 2018 2
Slide 3: Agenda: Highlights and key financial figures
1. Highlights and key financial figures 2. Endesa’s performance in 2017 market context 3. Financial results 4. Final remarks FY 2017 Results- Madrid, 28 Feb 2018 3
Slide 4: 2017 results exceeding guidance, despite adverse market conditions
2017 results exceeding guidance, despite adverse market conditions, thanks to managerial actions and one-offs Proposal to pay 1.382€ gross DPS, 4% increase versus 2016 Renewables: Strong commitment with decarbonization towards a diversified mix. 879 MW awarded in auctions and 132 MW to be acquired F
Slide 5: Key financial figures
Key financial figures €M 2017 2016 Change Like-for-like (1) EBITDA 3,542 3,432 3% 0% Net attributable income (2) 1,463 1,411 4% 3% Cash flow from operations (CFO) 2,438 2,995 -19% 31.12.2017 31.12.2016 Change Net financial debt 4,985 4,938 +1% FY 2017 results above guidance Managerial actions an
Slide 6: Agenda: Endesa's performance in 2017 market context
1. Highlights and key financial figures 2. Endesa’s performance in 2017 market context 3. Financial results 4. Final remarks FY 2017 Results- Madrid, 28 Feb 2018 6
Slide 7: Market context in 2017
Market context in 2017 Demand(1) Electricity wholesale prices Average pool prices Spain (€/MWh) Spain(2) Endesa distribution area(3) +32% (Not adjusted) 2.2% 1.9% 1.6% Industry +3,0% 52.2 1.1% 39.7 Services +0.2% Residential +3.2% 2016 2017 Thermal Gap(1) 60.9 TWh 76.5 TWh Adjusted for weather and w
Slide 8: Endesa's performance in 2017 market context: Energy management
Endesa’s performance in 2017 market context Energy management (1) (1) Output (GWh) Electricity sales (GWh) 78,648 103,640 +3% 106,750 +13% 69,831 3,441 2,817 3,401 1,212 (2) 16,297 15,263 13,043 12,634 Unitary integrated 7,373 8,106 margin(3): 18,439 18,904 22,891 +34% 30,712 €20.2/MWh 13,367 13,660
Slide 9: Agenda: Financial results
1. Highlights and key financial figures 2. Endesa’s performance in 2017 market context 3. Financial results 4. Final remarks FY 2017 Results- Madrid, 28 Feb 2018 9
Slide 10: Financial results
Financial results €M 2017 2016 Change Like-f-like Revenues 20,057 18,979 6% Gross Margin 5,488 5,652 -3% (1) EBITDA 3,542 3,432 3% 0% EBIT 2,031 1,965 3% Net Financial Results (123) (182) 32% Share of profit from associates (15) (59) 75% Income tax (427) (298) -43% (2) Net attributable income 1,463
Slide 11: EBITDA evolution
EBITDA evolution EBITDA net of one offs +3% €M -5% 3,432 3,393 3,239 3,542 39 303 Workforce Prov.: €226 M Workforce Prov.: €19 M Domestic coal: -€112 M Social tariff: -€222 M Catalan tax: -€63 M SCVP(1): -€20 M MtM gas&others : -€90 M SENP(2): -€52 M(3) Distribution: -€77 M MtM gas&others: €49 M Ebi
Slide 12: 2017 EBITDA breakdown
2017 EBITDA breakdown 2016 2017 % €M Change (%) €M % EGPE: 75 EGPE: 181 Generation & Supply(1) 29% Generation & Supply(1) 37% 1,255 -17% 1,040 Non-mainland Gx 13% Non-mainland Gx 11% 389 +16% 452 Distribution Distribution 58% 52% 1,788 +15% 2,050 TOTAL 3,432 +3% 3,542 TOTAL FY 2017 Results- Madrid,
Slide 13: Regulated business
Regulated business Gross margin evolution +8% €M 3,037 56 3,284 191 694 Non-mainland generation(1) 638 2,399 2,590 Distribution 2016 Dx Non-mainland Gx(1) 2017 Increase of regulated gross margin, benefitting from Distribution improvement Non-mainland Gx positive contribution due to previous year
Slide 14: Liberalized business
Liberalized business(1) Gross margin evolution -16% €M 2,615 2,204 -158 - 115 - 138 Electricity + Gas (underlying)(2) Gas (MtM&Others) 2016 Others 2017 Lower integrated unitary margin in the liberalized electricity business EGPE contribution (+€152 M) Gas business 2014-2016 Social Tariff (+€
Slide 15: Liberalized business: 2017 energy management
Liberalized business 2017 energy management Energy (TWh) Unitary values breakdown (€/MWh) Sales (1) 84.5 +4% 88.1 Unitary revenue 59.8 61.3 Energy 22.5 purchases 28.5 -21% Unitary variable cost(2) 38.0 41.1 EGPE: 3.4 +17% Mainland 65.6 output 56.0 17.5 ex -7% EGPE Unitary margin 21.8 20.2 2016 2017
Slide 16: Liberalized business: e-Solutions
Liberalized business e-Solutions Main KPIs achieved Projects, k#/year 2017 2020 Margin evolution e-Industries 3.4 4.3 €M Public charging stations, # 2017 2020 +16% 6 ~600 e-Mobility Public tenders under management, # 2017 2020 90 104 e-City 18 23 Maintenance and repair clients, 2016 2017 #mn 2017 20
Slide 17: Fixed costs evolution
Fixed costs evolution -12% €M -4% (1) 2,220 1,968 1,882 1,946 252 64 1,128 Personnel 898 917 +2% 913 costs ~0% O&M costs 1,209 1,187 1,191 1,251 Capitalized costs -117 -117 -222 -222 2016 2016 2017 2017 Reported Adjusted Adjusted Reported 4% adjusted fixed costs reduction driven by efficiency plan
Slide 18: Fixed costs evolution: monitoring cash cost and KPIs
Fixed costs evolution Monitoring cash cost and key performance indicators Cash Cost evolution KPI’s evolution and degree of fulfilment 2020 target Distribution Unitary cost (3) -8% €bn (€/customer) 41 49 45 2017 Adjusted Opex (1) 1.88 2016 2017 0.08 Unitary cost (3) 2017 EGPE Opex 1.88 Generation (k
Slide 19: From EBITDA to Net Income
From EBITDA to Net Income €M 1,511 123 8 3,542 427 10 2,031 1,900 1,463 EBITDA Depreciation EBIT Net Financial Associates Profit before Taxes Minorities Net and Results and Others taxes attributable amortization Income 11% 2016 3,432 -1,467 1,965 -182 -73 1,710 -298 -1 1,411 Change (%) +3% +3% +3% -
Slide 20: Net financial debt analysis
Net financial debt analysis Net financial debt evolution Net debt / 1.4x 1.4x EBITDA ratio €M 4,938 4,985 530 Regulatory working capital 1,411 2,438 1,074 4,961 4,455 Regulatory working capital -23 FY 2016 Cash flow from Capex(1)(€971 M€) Dividends FY 2017 operations + Others Normalization of regu
Slide 21: 2017 Capex breakdown
2017 Capex breakdown 2017 2017 Net CAPEX by business (€bn) Net CAPEX by nature (€bn) Main projects 4% 3% Smart meters and ~€0.2 bn Quality Plan 62% 52% 0.9 (1) 0.9 (1) IED Imported Coal ~€0.1 bn 34% 38% Nuclear fleet ~€0.1 bn Maintenance 7% Distribution Mainland Generation Maintenance Growth Non-Mai
Slide 22: Agenda: Final remarks
1. Highlights and key financial figures 2. Endesa’s performance in 2017 market context 3. Financial results 4. Final remarks 22
Slide 23: Sustainability
Sustainability Monitoring ENDESA´s contribution to UN Sustainable Development Goals ENDESA commitments(1) Main achievements 879 MW awarded in the Spanish renewable auction + 100% 132 MW to be acquired. Energy mix decarbonization by 2050 44% CO2 free production ~ € 1.4 bn. ~ € 0.3 bn. invested in 201
Slide 24: Renewables
Renewables Strong commitment with decarbonization Spanish auctions 2017 540 MW Wind – 339 MW PV MW ~ 2.4TWh/year €870 M Investment 879 7,395 7,353 6,384 339 353 132 540 PV 14 2,290 Wind 1,618 Acquisition Gestinver 132 MW Wind ~ 0.3TWh/year €178 M Investment (1) Hydro 4,752 4,752 2017 New capacity Ne
Slide 25: Digital Transformation
Digital Transformation 2017 main outcome CLIENTS 3.8 M digital customers (+0.7mn vs 2016) 2.1 M contracts with e-billing system (+0.5mn vs 2016) 9% digital sales (+2% vs 2016) 68.5% e-care interactions (+13.5% vs 2016) ASSETS 11.2 M smart meters installed (93% of the 15KW network) Grid a
Slide 26: Shareholder remuneration
Shareholder remuneration Gross DPS evolution 1.382(1) 1.333 €/Share (1) 0.633 0.682 0.70 0.70 Payment date Jan 2017 Jul 2017 Jan 2018 Jul 2018 100% pay-out of 2017 Results 2017 gross DPS: €1.382(1) (100% pay-out), an increase of 4% vs. 2016 (+5% vs minimum DPS) (1) Subject to AGM approval to be he
Slide 27: Delivering and exceeding 2017 targets
Delivering and exceeding 2017 targets 2017 2017 target reported CAGR (€bn) (€bn) 2018e (€bn) 2019e (€bn) 2020e (€bn) 2017-2020 EBITDA 3.4 >3.5 3.4 3.5 3.7 ~ +2% Net Income 1.4 ~ 1.5 1.4 1.5 1.6 ~ +3% DPS ~ 1.32 1.382 (€/share)(1) Minimum DPS for 2018 1.33 Cumulative 2.7 billion euro FCF(2) 100% Pa
Slide 28: 2017 results exceeding guidance thanks to managerial actions and one-offs
2017 results exceeding guidance thanks to managerial actions and one-offs Proposal to pay 1.382€ gross DPS, 4% increase versus 2016 º Strong commitment with decarbonization Continued effort in cost reduction High cash-flow generation supports attractive dividend policy of 100% pay out with a minimum
Slide 29: Appendix
Appendix Endesa FY 2017 Results 29
Slide 30: Installed capacity and output
Installed capacity and output Total output(1) (GWh) Total output (GWh) GWh 2017 +13% 78,648 (and chg. vs. 2016) Total Output (1) 69,831 Total 78,648 13% 13,043 Hydro 5,004 -30% 12,634 8,409 Nuclear 26,448 2% 3,858 Coal 24,906 17% 14,468 12,240 Natural gas 11,849 60% 6,793 7,835 Oil-gas 7,000 3% 1,21
Slide 31: Endesa: financial debt maturity calendar
Endesa: financial debt maturity calendar Gross balance of maturities outstanding at 31 December 2017: €5,392 M(1) Bonds and other marketable securities (2) Bank Debt Other debts 3,939 Endesa's 3,367 liquidity covers 29 months of 978 debt maturities 71 18 104 107 131 121 889 553 19 2018 2019 2020 202
Slide 32: Gross financial debt structure
Gross financial debt structure as of December 31st 2017 Structure of Endesa's gross debt €M 5,392 5,392 Floating 33% Euro 100% Fixed 67% By interest rate By currency Average cost of debt 2.1% FY 2017 Results- Madrid, 28 Feb 2018 32
Slide 33: New International Financial Reporting Standards (IFRS)
New International Financial Reporting Standards (IFRS) First Adoption IFRS Main Impacts First Adoption (*) IFRS 15 • Revenue agreements Revenue from • Intangible asset: €95 M contracts with • Customer acquisition costs customers January 1, 2018 IFRS 9 • Classification of financial assets Financial •
Slide 34: Glossary of terms (I/II)
Glossary of terms (I/II) Reference note (#) of Consolidated Item Calculation Management Report Average cost of debt (%) (Cost of gross financial debt) / gross average financial debt: €130 M / €6,082 M = 2.1% 4.1 (Principal x number of days of term) / (Principal in force at the end of the period x nu
Slide 35: Glossary of terms (II/II)
Glossary of terms (II/II) Reference note (#) of Consolidated Item Calculation Management Report Long and short term financial debt (€4,414 M + €978 M) - Cash and cash equivalents (€399 M) Net financial debt (€M) 4.1 – Derivatives recognized as financial assets (€8 M) = €4,985 M Financial Revenues (€
Slide 36: 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