Slide 1: Hera Group FY13 Results Analyst Presentation
H E R A G R O U P Y 1 3 R E S U LT S Analyst Presentation 2 0 t h M a r c h 2 0 1 4 Touching the future NOW
Slide 2: Expectations
Expectations EBITDA to 951m€ in 2017; Capitalization on new regulation (Water) and recovery upon consolidation opportunities (Energy distribution) Bounce back in Waste: a mix of volume and profitability Enhance financial strength Deliver a visible and reliable shareholder return (minimum 9 cents DPS
Slide 3: 2013 strong growth and shareholders' return
2013 strong growth and shareholders’ return ‘ 1 3 R E S U LT H I G H L I G H T S (M€) +25.5% Growth driven by M&A (77%) and +23.9% +43.3% Organic growth (23%). +38.9% Organic growth from market expansion and cost cutting. Growth drove sound cash flows. Debt Fully diluted EPS reduction from by 91m€.
Slide 4: Ebitda growth: mix of M&A, org. growth and outperforming synergies
Ebitda growth: mix of M&A, org. growth and outperforming synergies EBITDA Growth Synergies extraction (M€) outperformance (M€) +7 +30 +8 +8.3 +8 +1.3 +7 2013 2014 2015 2016 2017 Organic growth Ebitda per employee: +8.5% cagr (M€) (K€/per capita) 101 +1.7 +0.3 +30 +30.0 831 +15.1 41 645 662 567 607 5
Slide 5: Net profit growth: benefitting from optimization initiatives
Net profit growth: benefitting from optimization initiatives Ta x r a t e (%) Provisions reflects ‘ 1 3 R E S U LT H I G H L I G H T S Acegas merger 2012 2013 Ch. % (M€) (M€) Tax rate reported 37.0% 40.6% +9.7% 2012 2013 Ch. % Tax rate adj.* 47.0% 46.1% (2.0%) Revenues 4,696.3 4,851.3 +3.3% EBITDA 6
Slide 6: 2013: a record jump in scale
2013: a record jump in scale Waste 238m€ Waste 184m€ +29.5% Networks 310 Networks 414m€ ’13 EBITDA +33.7% ’12 EBITDA 831m€ 662m€ Energy Energy 151 170 Other +12.0% 17 Other 9m€ ~1.7 million Energy customers ~2.0 million Energy customers 54% Regulated 56% Regulated 46% Liberalised Balanced regulated
Slide 7: Networks: a visible cash flow platform
Networks: a visible cash flow platform EBITDA GROWTH (M€) +33.7% More visibility on tariffs +64 +3 414 Concentrated presence on the territory +20 +17 310 13 310 Upside potential in water tariff 158 27 Acegas Aps contribution: 87.8m€ Further efficiency gains potential 112 2012 2012 Gas EE Water TLR 2
Slide 8: Waste: inverting trend in special waste despite crisis
Waste: inverting trend in special waste despite crisis EBITDA growth Electricity from waste plants (M€) (TWh) +29.5% +47.8% +16 (3) 238 +36 +5 184 Wide spread platform of Treatment volume from market (kton) waste plants +18.6% +162 +202 3,947 3,329 1,940 1,559 +254 +24.2% 1,771 2,010 +13.6% 2012 Ace
Slide 9: Energy: exploiting "The" intangible asset
Energy: exploiting “The” intangible asset EBITDA growth (M€) +12.0% +13.0 +60k clients in electricity +0.9 (7.4) 168.6 169.5 CCI impact only on Q4 +11.6 Crisis impact on volumes 151.4 Acegas contribution: 14.6 mln € Enlargement of “Salvaguardia” service through public tenders (2014-2016) 2012 Sales
Slide 10: Outperforming free cash flows
Outperforming free cash flows Cash Flows (M€) Debt ‘12 2,686 m€ Debt ‘13 2,595 m€ Debt mix POSITIVE CASH FLOWS (M€) Acegas Aps debt decreased (463m€) Very positive working capital mgmt Debt from 2,686 m€ (on a like for like basis) to 2,595 m€ Refinanced 1,000 m€ debt at good rates Opportunistic fund
Slide 11: All financial ratios enhanced
All financial ratios enhanced FFO/DEBT* (%) 8 years average debt Duration 47% variable and 53% fixed interest rates S&P’s: BBB - outlook stable Moody’s: Baa1 - negative outlook DEBT/EBITDA DEBT/EQUITY (X) (X) 1,17x 1,12x 2012 2013 * On reported figures 10 GRUPPOHERA
Slide 12: Extracting value from M&A
Facing the future with a high potential platform EBITDA (M€) CAGR +2.7% ‘13 Ebitda growth: 58% of 5Y plan target Outperform on all targets Amga Udine DPS of 9 cents (5.5% yield*) Commercial expansion continues AMGA Udine execution Extracting value from M&A *On year end stock price: 1.65€. 11 GRUPPOH
Slide 13: Q&A Session
Q&A SESSION 2014 will apply IFRS11 with an overall impact of 15 m€ on Ebitda 2014 will apply indirect cost reallocation (see appendix)
Slide 14: '13 EPS increased even on adjusted, like for like and fully diluted basis
‘13 EPS increased even on adjusted, “like for like” and “fully diluted” basis Adjusted Like for like EPS (fully diluted) (cent €) 2012 figures 2013 figures Acegas Aps 2012 Net profit 45.2m€ mainly Acegas Aps 25.5m€; badwill 6.7m€ Energonut 11m€ write off (mainly Tirreno Power and 2,2m€ plus non ~22
Slide 15: Ebitda breakdown: Review on indirect cost allocation
Ebitda breakdown: Review on indirect cost allocation Restated EBITDA breakdown (M€) FY2012 FY2013 Ch. % Breakdown by Strategic Area Waste 180.6 243.9 +35.1% Networks 295.2 371.0 +25.7% Energy 166.7 191.0 +14.6% Other 19.7 24.7 +25.8% Group 662.1 830.7 +25,5% Breakdown by business Waste 180.6 243.9 +
Slide 16: Financial highlights breakdown
Financial highlights breakdown Ta r i f f s u n d e r p i n n e d a s o l i d Higher margins due to trading growth decrease FY2012 FY2013 CH. % FY2012 FY2013 CH. % REVENUES 617.1 730.5 +18.4% REVENUES 1,769.3 1,695.6 (4.2%) EBITDA 158.3 222.3 +40.4% EBITDA 240.7 276.2 +14.7% Ebitda margin 25.7% 30.4
Slide 17: 2013 Capex
2013 Capex Capex (M€) +46 295 276 (27) 2012 Hera Acegas Aps 2013 15 GRUPPOHERA