Edison Spa · MIL:EDNR
Edison Spa — Investor Presentation (November 2007)
38 slides from Edison Spa's investor presentation, Nov 29, 2007
Slide 1: Edison Business Plan 2008-2013
EDISON BUSINESS PLAN 2008-2013 Milan, November 29th 2007
Slide 2: Agenda
AGENDA 1. KEY STRATEGIC GUIDELINES 2. MAIN ASSUMPTIONS AND SECTOR ENVIRONMENT 3. OPERATING TARGETS AND STRATEGY IN THE ELECTRIC POWER AND HYDROCARBONS SECTORS 4. FINANCIAL TARGETS 5. CAPITAL AND SHAREHOLDING STRUCTURE 6. APPENDIX 2
Slide 3: Key Strategic Guidelines
KEY STRATEGIC GUIDELINES ¾ Edison has completed one of the most important investment plans in the European power sector reaching in 2007 a total installed capacity in Italy of 12.5 GW. ¾ Strategic target in electric power is to preserve a share in Italian generation capacity of around 15% and to inc
Slide 4: Main Assumptions and Sector Environment
MAIN ASSUMPTIONS AND SECTOR ENVIRONMENT 4
Slide 5: Macro Economic Assumptions
MACRO ECONOMIC ASSUMPTIONS 2008 2010 Long Term BRENT (1) U$D/bbl 70.0 57.2 50.4 U$D/€ 1.37 1.30 1.27 €/bbl 51.2 44.0 39.7 CO2 €/ton 18.6 17.4 21.0 COAL U$D/tons (2) 83.6 59.2 51.0 (1) ICE brent swap (2) CIF ARA (API#2) 5
Slide 6: Evolution of Electricity Market in Europe
EVOLUTION OF ELECTRICITY MARKET IN EUROPE Power generation capacity increase Capacity and fuel mix at 2010 Oil & % Increase in installed others Hydro Installed capacity Thermal % % Renewable capacity in 2002-2010 at end of 2010 Gas Other renewable 12% +27% Coal Nuclear 6%7% 88% 134GW 13% 27% 21% 4%
Slide 7: Evolution of Power Prices in Europe
EVOLUTION OF POWER PRICES IN EUROPE 100 Average monthly prices (1) PUN (Prezzo Unico Nazionale) – Average National Price 90 (2) Average base load prices (3) Last available data at 25/11/07 80 70 60 Recurrent export opportunities can have an impact on the evolution of prices €/MWh 50 40 based on po
Slide 8: Power Demand and Installed Capacity in Italy
POWER DEMAND AND INSTALLED CAPACITY IN ITALY Evolution of power demand (TWh net ’08-’13 CAGR 2.4% of losses) 400 368 350 317 319 40 300 34 68 Non eligible 250 81 Eligible 74 200 Switched 307 Self consumption 150 100 183 154 50 21 21 21 0 2006 2007 2013 Source: Edison estimates Development of install
Slide 9: Evolution of Power Prices in Italy
EVOLUTION OF POWER PRICES IN ITALY Expected merchant CCGTs utilization and brent Power prices and spark spread 6.000 CCGTs utilization 80 5.000 hours/yr 70 4.000 60 3.000 50 PUN Jan-Nov 2007: €/MWh 70.0 €/MWh 40 2.000 2007 2008 2009 2010 2011 2012 2013 30 80 20 Brent U$D/bbl 70 10 U$D/bbl 60 0 2005
Slide 10: Evolution of Gas Market in Europe
EVOLUTION OF GAS MARKET IN EUROPE (1) Gas demand in Europe Gas production in Europe (bcm) 800 720 (bcm) ’07-’20 CAGR 1.8% 700 638 31 400 558 27 Own use and losses 350 600 234 300 24 Residential 500 218 250 Industry 201 200 400 Power generation 150 196 300 100 181 165 50 200 0 259 100 212 90 92 94 96
Slide 11: Evolution of Gas Demand in Italy
EVOLUTION OF GAS DEMAND IN ITALY (bcm) ’08-’13 CAGR 2.1% 120 Gas import ’06: 74 bcm ~100-108 (b) 100 95 Gas import ’15: 96-104 bcm 89 4 85 84 3 3 3 3 Import gap vs 2006: 22-30 bcm 80 32 32 31 30 28 60 22 21 21 New import capacity in Italy 40 19 19 bcm operating in 20 34 35 39 42 TTPC Improvement 6.5
Slide 12: Targets and Strategy in the Electric Power and Hydrocarbons Sectors
TARGETS AND STRATEGY IN THE ELECTRIC POWER AND HYDROCARBONS SECTORS 12
Slide 13: Edison Targets in the Power Sector
EDISON TARGETS IN THE POWER SECTOR Total merchant capacity at end 2007 around 8,000 MW. EDISON AND Further new 800 MW CCGT plant in Central Italy expected at end 2011 and around EDIPOWER 600 MW ex-CIP6 plants repowered in merchant GT (LMS 100, open cycle, peak MERCHANT hours usage). PLANTS Fur
Slide 14: Edison Merchant Plants Evolution in Italy
EDISON MERCHANT PLANTS EVOLUTION IN ITALY Altomonte LMS 100 800MW Bussi 110MW LMS 100 Candela Simeri LMS 100 San Quirico 400MW Crichi Azotati 230MW 110MW LMS 100 800MW Porto Viro Torviscosa Central Italy 110MW 800MW 800MW 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 ( *) Tirano CC Merchant line
Slide 15: Electricity Capex
ELECTRICITY CAPEX (€ mln) 2,980 (b) + € 1,050 mln 360 +40 1,930 (a) 860 320 +600 250 260 - 50 300 550 + 290 260 220 + 200 420 570 - 30 540 2007-12 Previous BP 2008-13 Current BP Maintenance and recurrent capex Foreign capex Repowering Other renewable Hydroelectric revamping and development Greenfiel
Slide 16: Edison Group Plants Portfolio
EDISON GROUP PLANTS PORTFOLIO Chivasso 1200MW* Torviscosa 800MW Greenfields and repowering Piacenza Sermide 800MW* 1200MW* Marghera Azotati 230MW Installed capacity (GW) Turbigo 1750MW* Porto Viro 110MW LMS 100 San Quirico 110MW 2007 2013 Coal Thermal 7.8 9.2 Oil Central Italy Bussi 110MW Renewable
Slide 17: Electricity Sources and Uses on the Free Market
ELECTRICITY SOURCES AND USES ON THE FREE MARKET Sources for the free market (TWh) Sales on the free market (TWh) ’08-’13 CAGR 3.4% 60 60 50,1 50,1 50 50 40,9 13,1 40,9 10,5 40 1,2 40 10,2 2,5 30 18,1 30 31,0 20 20 39,6 23,4 10 10 22,8 1,5 1,5 4,4 5,9 0 -1,1 -2,6 0 2007 Exp. 2013 2007 Exp. 2013 -10 I
Slide 18: Renewables (Italy and International)
RENEWABLES (ITALY AND INTERNATIONAL) Installed Capacity (MW) MW ~2.100 ~2.700 % of Edison ~17% ~20% capacity 685 50 15 (a) 50 Wind & others (a) 50MW increase in wind power in South-East Europe 270 570 Rationale Rationale of of renewables: renewables: 99 fuel fuel diversification diversification 2007
Slide 19: Power International: Projects Under Evaluation and Opportunities
POWER INTERNATIONAL: PROJECTS UNDER EVALUATION AND OPPORTUNITIES MW (1) Greece Thisvi Greenfield CCGT Starting 210 construction T-Power Contributed CCGT Operating 200 by HP Astakos Greenfield Coal Waiting for 300 authorization Rumania GenCo Acquisition Thermo Privatisation 220 expected to start Turk
Slide 20: CO2 Emission Trading and Green Certificates
CO2 EMISSION TRADING AND GREEN CERTIFICATES EMISSION TRADING GREEN CERTIFICATES - Edison assumptions in the business plan: CO2 - The requirement of the ratio of GC production deficit in 2008-2012 (second regulatory period) over total generation has not yet been defined estimated equal to 12 million
Slide 21: Edison Targets in the Hydrocarbon Sector
EDISON TARGETS IN THE HYDROCARBON SECTOR INFRASTRUCTURES Confirmed development of new import infrastructures: LNG Terminal GALSI IGI Gas storage: Improve logistics flexibility in order to sustain sales target. Confirmed development up to 1.6 bcm of working gas, 2.2 bcm total capacity. Re
Slide 22: Edison Hydrocarbons Evolution
EDISON HYDROCARBONS EVOLUTION Galsi LNG Rovigo Infrastructures IGI Cavarzere Minerbio Storage San Potito- Collalto and Cotignola (90% Mafalda Cellino Edison) (40% Edison) 2008 2009 2010 2011 2012 Croatia and Tresauro Algeria Panda E&P 200 mcm/y 280 mcm/y 330 mcm/y plus 50 mcm eq./y Supply 2.0 bcm Al
Slide 23: Hydrocarbons Capex
HYDROCARBONS CAPEX (€ mln) + € 570 mln 3,200 2,630 510 + 20 490 550 + 10 540 1000 + 190 810 780 + 290 490 300 + 60 360 2007-12 Previous BP 2008-13 Current BP New import infrastructure and trasmission Gas storage Production related to existing reserves Production related to acquisitions or new findin
Slide 24: Development of Gas Import Infrastructures
DEVELOPMENT OF GAS IMPORT INFRASTRUCTURES Total capacity Edison share Gas Edison Start up Invest.: 10% Contracted ACQ Adriatic LNG 8 bcm/y 4Q 2008 Capacity: 80% 6.4 bcm/y (1) Invest.: 18% Contracted ACQ Galsi 8 bcm/y 2012 Capacity: 25% 2.0 bcm/y (2) Invest.: 50% 6.4 bcm/y (1) IGI 8 bcm/y 4Q 2012 Cap
Slide 25: Gas Infrastructures: Domestic Facilities
GAS INFRASTRUCTURES: DOMESTIC FACILITIES Peak capacity @ end of winter 14,0 Mln cm/day •• Completion Completion of of investment investment 2,2 plan: plan: capex capex around around €€ 550 550 mln mln 2,2 of of which which €€ 230 230 mln mln facilities facilities Working gas and and €€ 320 320 mln m
Slide 26: Gas Supply and Sales Targets
GAS SUPPLY AND SALES TARGETS SOURCES USES (bcm) 23.2 ’08-’13 CAGR 9.0% 23.2 1,6 1,6 0,3 4,0 3,8 2,0 2,0 9,3 6,4 4,2 2,0 4,0 4,3 0,9 2013 2013 International production Foreign sales Purchases in Italy or spot import Other uses (partners and export) Middle East from IGI Thermoelectric uses Algeria fro
Slide 27: E&P Reserves and Development of Equity Gas
E&P Reserves Development of equity gas (bcm eq.) ’08-’13 CAGR 12.9% 2,9 Croatia 1.9 bcm 1,6 Italy 17.4 bcm 1,4 Algeria 6.4 bcm 0,3 0,4 0,4 0,9 0,7 Egypt 4.3 bcm 2007 Exp. 2013 International production - gas Domestic production - oil Domestic production - gas Proven reserves at Dec. 31, 2006 = 30 bcm
Slide 28: Financial Targets
FINANCIAL TARGETS Qcvison
Slide 29: Main Economic and Financial Targets
MAIN ECONOMIC AND FINANCIAL TARGETS Target 2008-2013 (1) EBITDA 7-8% CAGR EBIT 12-13% CAGR CAPEX ~6,200 mln € (2) R.O.I. average per year ~10% Forecast 2013 NFP ~3,200 mln € NFP interest bearing debt ~2,500 mln € (1) Based on expected 2007 figures. (2) Of which around € 1 billion related to capex wh
Slide 30: EBITDA Change by Activity
EBITDA CHANGE BY ACTIVITY 120% 100% 11% 12% 15% 14% 80% 2% 10% 22% 4% 60% 20% 20% 40% 5% 20% 38% 34% 0% -4% -3% 2007 2013 -20% E&P Gas supply and marketing Gas logistics CIP6, captive and other regulated activities Hydro and other renewables Power international Electric power merchant activities and
Slide 31: Capital and Shareholding Structure
CAPITAL AND SHAREHOLDING STRUCTURE 31
Slide 32: Shareholding Structure
SHAREHOLDING STRUCTURE As of 18 July 2007 (a) Dolomiti Financial AEM Spa Enia Spa SEL Spa EDF Energia Spa Investors 51% 15% 10% 10% 14% EdF and Delmi have signed an 100% agreement which regulates Edison corporate governance in Transalpina DELMI WGRM di Energia (TdE). This agreement has a three-years
Slide 33: Capital Structure
CAPITAL STRUCTURE Shares and warrants Shareholding structure fully diluted CAPITAL STOCK AS OF 31.10.2007 DELMI WGRM - Ordinary shares 4,682,266,345 - Saving shares 110,592,420 Transalpina di 50% Energia 50% - TOTAL SHARES 4,792,858,765 61.3% WARRANTS OUTSTANDING AS OF 31.10.2007 TO BE Tassara 10.0%
Slide 34: Appendix
APPENDIX Qcvison
Slide 35: Adriatic LNG Terminal
ADRIATIC LNG TERMINAL GBS end wall completed (June 2007) Owner and Operator: Terminale LNG Adriatico Srl (45% each Exxon Mobil and Qatar Petroleum and 10% Edison) Capacity: 8 bcm Access: Edison has the right to use on a priority basis 80% of the regassification capacity equal to 6.4 bcm for 25 years
Slide 36: IGI Pipeline
IGI PIPELINE On January 31st 2007, the Italian and Greek Governments have signed a protocol of intent whereby Edison and Depa will have the right to use for 25 years the whole transmission capacity (8 bcm) provided by IGI natural gas pipeline. In particular, Edison will have 80% of total capacity an
Slide 37: GALSI Pipeline
GALSI PIPELINE Capacity: 8 bcm/yr Length: approx. 900 km of which 600 km offshore and 300 km onshore VENEZIA I T A L Y E Operating start: 2012 Minerbio C Gas Storage AN GENOVA La Spezia Project status: FR NIZZA Sonatrach called for tender for the purchase of gas through the Marseille Livorno P
Slide 38: Disclaimer
DISCLAIMER This document has been prepared by EDISON solely for the use at investors and analysts meetings. This document does not constitute an offer or invitation to purchase or subscribe any shares and neither it nor any part of it shall form the basis of or be relied upon in connection with any