Snam S.p.a. · MIL:SRG
Snam — Snam Rete Gas — FY2001 Earnings Presentation
20 slides from Snam's earnings presentation, Feb 27, 2002
Slide 1: Analyst Presentation
ANALYST PRESENTATION February 27, 2002
Slide 2: Significant results achieved in a short timespan
1. 1. Significant Significant results results achieved achieved in in a a short short timespan timespan 2. FY01 results Analyzing our performance with a focus on: Volumes Volumes Cost Cost cutting cutting Tax Tax value value 3. 3. A A look look at at the the stock stock and and closing closing remar
Slide 3: Achievements
Achievements Company’s establishment (November 2000) Transfer of assets (July 2001) Stock market listing (December 2001) First shrs’ meeting: 3 board members elected (February 2002) by the minorities 3
Slide 4: Share capital
Share capital Institutional segment: Post-IPO share capital breakdown by country 8,7% 22% 38% 31,5% 59,8% 21% 19% Eni Institutional Retail UK USA Italy RoW A large free float with a significant presence of international investors 4
Slide 5: Operational steps
Operational steps September Tariff system approval 2001 September Access conditions 2001 Capacity booking process October 2001 Web platform 27 operating shippers for a capacity market 5
Slide 6: Transport capacity at entry points
Transport capacity at entry points Gas year 2001/2002 MSm3/day (-15°C; 1,01325 bar) PASSO GRIES TECHNICAL Capacity 47,7 TARVISIO-GORIZIA ASSIGNED Capacity 43,4 TECHNICAL Capacity 79,5 AVAILABLE Capacity 4,3 ASSIGNED Capacity 74,9 AVAILABLE Capacity 4,6 LNG PANIGAGLIA TECHNICAL Capacity 11,4 ASSIGNED
Slide 7: Highlights
Highlights Strong Healthy Large size cash flow margins generation 2H 2001 REVENUES (Mln €) 932 EBIT (Mln €) 448 NET PROFIT (Mln €) 183 FREE CASH FLOW (Mln €) 268 LEVERAGE (D/D+E) 45% CAPEX (Mln €) 256 7
Slide 8: Income statement
Income statement €m 2H 2001 Revenues 932 Operating costs 252 Labour cost 58 Other operating costs 188 Provisions 6 EBITDA 680 Depreciation & Amortisation 232 EBIT 448 Net interest income (expenses) (126) Extraordinary income (expenses) (30) EBT 292 Income taxes 109 Net profit 183 8
Slide 9: Revenues
Revenues €m 2H 2001 TOTAL REVENUES 932 REGULATED REVENUES 866 Transport 843 of which on behalf of third parties 9 GNL 23 NON REGULATED REVENUES 66 9
Slide 10: Volumes
Volumes bcm 2000 2001 Change Domestic gas demand 70.7 71.2 +0.5 Tariff reference volumes 73.1 of which: relevant to Snam RG 72.0 4Q 4Q Change 2000 2001 Domestic gas demand 19.0 21.6 +2.6 Volumes injected in Snam RG network 18.1 18.5 +0.4 gas injected = gas demand +/- storage + export + transit 10
Slide 11: Operating expenses
Operating expenses €m 2000 2001 2H p.f. p.f. Change 2001 REGULATED ACTIVITIES 494 411 -83 198 Variable costs 70 66 -4 36 Operating fixed costs 297 269 -28 129 Modulation services 83 69 -14 27 Provisions 44 7 -37 6 NON - REGULATED ACTIVITIES 101 100 -1 54 Variable costs 27 18 -9 9 Fixed costs 74 82 +
Slide 12: Headcount reduction
Headcount reduction nr. 1 Jul 31 Dec Change 2001 2001 Operations 2.541 2.398 -143 Business development 231 243 +12 Staff 329 317 -12 Other 14 15 +1 TOTAL (*) (*) 3.115 2.973 -142 (*) Not including personnel on unpaid leave 12
Slide 13: Regulated activities: operating fixed costs
Regulated activities: operating fixed costs €m 2000 2001 2H p.f. p.f. Change 2001 REGULATED ACTIVITIES 297 269 -28 129 TRANSPORTATION 286 258 -28 123 Network 224 199 -25 93 Compressor stations 20 20 - 10 Dispatching and metering 42 39 -3 20 LNG 11 11 - 6 9% cost reduction vs 2000 13
Slide 14: Improving efficiency... delivering value
Improving efficiency... OPERATING FIXED COSTS … delivering value Risk b ased decis Proce mode ion ss l in m ainten ance rengi Telem n eering eterin Tele-d g& iagno Remo s tic te con trol syste Syste ms ms 100% 2000 2000 2000 2001 90% 2001 COMPRESSOR 2001 DISPATCHING & METERING STATIONS NETWORK Refer
Slide 15: Tax value
Tax value €m 2H 2001 Fiscal Exceeding depreciation 298 depreciation Tax Saving (IRPEG+IRAP) 120 Tax value 55 Current tax savings 120 Present value of deferred taxes -65 “Tremonti Capex 138 Law” Tax base reduction (IRPEG) 69 Tax value 25 Current tax savings 21 Present value of deferred taxes 4 TOTAL
Slide 16: Balance sheet
Balance sheet €m 1/7 31/12 2001 2001 Net Invested Capital 9,481 -85 9,396 Fixed assets 9,580 -155 9,425 Tangible assets 9,529 -191 9,338 Intangible fixed assets 51 +36 87 Net working capital -73 +61 -12 Short term receivables 40 +418 458 Short term liabilities -113 -357 -470 Staff-leaving indemnity
Slide 17: CAPEX
CAPEX €m 2000 2001 2H p.f. p.f. Change 2001 TOTAL 379 429 +50 256 DEVELOPMENT 260 295 +35 153 Transportation - national 137 193 +56 100 Transportation - regional 120 99 -21 52 LNG 3 3 - 1 MAINTENANCE AND OTHER 119 134 +15 103 Maintenance 119 86 -33 55 Gas line pack - 16 +16 16 Listing - 32 +32 32 17
Slide 18: Cash flow
Cash flow €m 2001 Net income 183 Depreciation 232 Deferred taxes 97 Provisions 11 Change in staff leaving indemnity -9 Change in working capital -169 Cash flow from operations 345 Net investments -77 Free Cash Flow 268 Capital increase (*) (*) 1,263 Net cash flow 1,531 Initial Net Financial Debt (*)
Slide 19: The Stock
1000 1025 1050 1075 1100 850 875 900 925 950 975 06/12/01 MIB All share Index 11/12/01 16/12/01 21/12/01 26/12/01 31/12/01 05/01/02 10/01/02 Utilities Index Eurostoxx 15/01/02 20/01/02 25/01/02 30/01/02 04/02/02 09/02/02 The Stock Snam RG 14/02/02 19/02/02 24/02/02 19
Slide 20: Closing remarks
Closing remarks 1. STRONG RESULTS IN THE CORE BUSINESS 2. COST CUTTING AHEAD OF TARGET 3. STRATEGY ON TRACK 4. CORPORATE GOVERNANCE: MINORITIES “ON BOARD” 20