2016 3Q Results. Milan, November 15 th, snam.it

Transcription

1 2016 3Q Results Milan, November 15 th, 2016 snam.it

2 Outline Highlights Q Consolidated Results 2

3 Gas demand trends GAS CONSUMPTION (bcm) Weather adjusted Weather-adjusted gas demand up 2.3% driven by: Other Sectors Thermoelectric Industrial * +1.3% ,4 1,5 15,2 16,2 11,9 12,3 +2.3% ,4 1,5 15,2 16,2 11,9 12,3 Industrial sector (+3.1%) with evidence of a moderate production recovery. Thermoelectric (+6%), with lower imports, hydroelectric Residential consumption contained by energy efficency initiatives Residential & commercial 19,1 18,4 9M M ,9 19,6 9M M 2016 GAS INJECTED 51.4 bcm +3.0% vs 9M 2015 * Includes: NGV, Agriculture and Non-Energy Use Source: National Transport Network Balance 3

4 Operational highlights Transport Capex in line with targets New balancing regime in place Storage 100% of the offered storage capacity conferred Record working gas storage (98% of available capacity) achieved Oct 2016 Capacity: 16.5 bcm +3.1% vs Sept 2015 LNG Seasonal price differentials driving summer demand for LNG LNG cargoes returned to Italy and Panigaglia in the last six months 512 Mn invested in the first 9 months of 2016 o.w. 47% in development initiatives +5% Working gas CAGR 2008 to 2016 (+0.5 bcm compared to 2015) 4 LNG cargoes to Panigaglia between May and July totalling liquid cubic meters 4

5 Corporate highlights Corporate activity Italgas demerger achieved New organization Liability management executed in October Faster cost of debt reduction Maturity extension and lower refinancing risk Share Buyback initiated Flexible instrument to optimize financial structure Agency Agreement signed for first 4-month tranche 5

6 Gas Connect Austria Rationale for the acquisition 900km gas transmission pipelines, 5 compression stations Consolidate Snam s position in a key country for the interconnection of European natural gas markets Leverage on decades of experience in Austria, TAG ownership Strong financial discipline applied The deal Acquisition completed through a vehicle owned 60%/40% by Allianz and Snam respectively Acquisition price of 601 M Binding non-recourse financing of 310 M Closing of the transaction expected by year-end 6

7 Financial highlights Solid 9M results Revenues in line with expectations ( 2.469bn, -4,2% owing to new regulatory WACC) Increased investments (capex 842m, +5%) Strong free cashflow generation ( 669m) FY 2016 (Snam pro-forma) Guidance confirmed 0.9bn capex 19.5bn consolidated RAB 0.8bn adjusted net income 7

8 Outline Highlights Q Consolidated Results 8

9 9M 2016 consolidated results REGULATED REVENUES EBIT NET PROFIT 2,469 mn 1,296 mn 783 mn -4.2% vs 9M % vs 9M % vs 9M 2015 CAPEX FREE CASH FLOW NET DEBT 842 mn 669 mn 14.0 bn +5% vs 9M

10 Ebit Analysis [ mn] -176 mn -12.0% 1, , EBIT M Regulated revenues Controllable fixed costs Depreciation & amortisation Other EBIT M 10

11 Net Profit Analysis [ mn] -105 mn -11.8% Net profit M EBIT Net Interest Income (expenses) Net Income from associates Income taxes Net profit M 11

12 Snam debt structure KEY FIGURES EXISTING DEBT as of 30 September 2016 ( bn) BOND MATURITY PROFILE as of 30 September 2016 ( bn) Fixed/variable rate debt: 58% / 42% M/L Term debt maturity: ca. 4.4 years Bondholders Meeting on the separation of Italgas from Snam Consent solicitation launched on 8.6bn outstanding bonds Approval of the separation with a vast majority Liability management executed in October paves the way to further cost of debt reduction going forward Net debt 9M Total committed credit facilities and bonds Pool banking facilities Debt capital market Bilateral banking facilities Institutional lenders financing 12

13 2016 9M: cash flow and change in net debt Cash flow Change in net debt m m Depreciation & other items Change in working capital +220 Net investments 240 m Net profit ,686-1,017 Shareholder's equity Cash Flow M Non cash financials items Cash Flow from operation M Free Cash Flow M -206 Cash Flow M Net financial Debt 2015 Net financial Debt M 13

14 Driving balance sheet efficiency Debt structure Resizing and reshaping of Snam debt structure following the 3.6 bn received from repayment of intercompany/assigned debt by Italgas 1 bn reduction in ourstanding Bonds Average maturity Increasing the average maturity of debt, smoothing the Company s maturity profile and pro-actively managing upcoming redemptions average maturity of M/L term debt: from ca. 4.4 to ca. 5.4 years Cost of debt Taking advantage of the market conditions to reduce the average cost of debt (from 2017 onwards) Cost of new bonds well below 1% 14

15 Liability Management overview Bond Maturity Profile after October 2016 (bln ) 2,0 Liability Management Transaction Timing Launch: 10 October 2016 Announcement of the Results: 18 October 2016 Settlement: 25 October ,5 1,0 0,5 Highlights 2.75 bln bonds buyback (3.1 bln of cash spent) Average residual maturity: ca. 3.3 years Average yield: ca. 3.8% financed via a mix of existing credit lines and new 0, Residual Amount outstanding Oct -16 New issues Amount repurchased bonds: 1.25 bln 10Y Oct % coupon 0.5 bln 4Y Oct % coupon ca bln from already available banking lines average yield: 0.7% average maturity: 8.3 years 15

16 Q & A S e s s i o n 16

17 A n n e x e s 17

18 GCA overview 2012 September 2014 September 2016 CGA at a glance Founded in Jan 2012 as wholly owned subsidiary of OMV One of the two Transport System Operators (TSO) in Austria Owns and operates 886 km of high pressure pipelines linking Germany, Hungary, Slovenia and Slovakia Plays an important part in the Austrian and European gas supply network Holds equity stake in several key infrastructure companies Certified ITO and market area manager for the Eastern market area by Austrian regulator GCA s Trans Austria Gasleitung (TAG) pipeline transferred to Austrian TSO Trans Austria Gasleitung GmbH Agreement for the sale and purchase of a 49% minority stake in Gas Connect Austria GmbH (GCA) signed by OMV and the Consortium composed of Allianz and Snam S.p.A. 18

19 Transaction structure Ownership Transaction structure 51% 60% 40% GCA 15.5% TAG GmbH vehicle 49% 84.5% Pool of banks Senior Loan financing Competitive auction process for the 49% stake in GCA started by OMV in Q Snam and Allianz Capital Partners (ACP) formed a Consortium in Q to jointly bid for GCA. Total cash consideration paid to OMV equal to 601 M, including 147 M pro-quota reimbursement of existing GCA shareholder loan Binding non-recourse financing of 310 M granted to the Consortium by a pool of international banks Acquisition completed through a jointly controlled vehicle owned 60%/40% by Allianz and Snam respectively Closing of the transaction expected by year-end 19

20 Operational data 9M M 2016 % Transport Gas injected into the network (bcm) Gas pipeline network (km in operation) 32,454 32, Storage Storage capacity (bcm) Modulation Strategic Gas moved through storage system (bcm) Injection Withdrawal Distribution Gas distributed (bcm) Active Gas Metering at redelivery points (# mln)

21 Income Statement [ mn ] M M Change Revenues 2,748 2, Operating expenses EBITDA 2,108 1, Depreciation & amortisation EBIT 1,472 1, Net interest income (expenses) Net income from associates EBT 1,292 1, Income taxes NET PROFIT

22 Revenues [ mn ] M M Change Regulated revenues 2,695 2, Transport 1,429 1, Distribution Storage LNG Pass-through revenues Other revenues TOTAL REVENUES 2,748 2,

23 Operating Expenses [ mn ] M M Change Regulated activities Controllable fixed costs Variable costs Other costs Pass-through costs Non regulated activities TOTAL COSTS (1) Net of pass-through costs.

24 Balance Sheet [ mn ] Dec, Sep, Change Net invested capital 21,365 21, Fixed capital 22,121 22, Tangible fixed assets 15,396 15, Intangible fixed assets 5,275 5,275 - Financial receivables held for operating activities Equity-accounted and other investments 1,372 1,363-9 Net working capital Receivables 2,092 1, Liabilities -2,699-2, Provisions for employee benefits Assets held for sale and directly related liabilities Net financial debt 13,779 14, Shareholders' equity 7,586 7,

25 Disclaimer This presentation contains forward-looking statements regarding future events and the future results of Snam that are based on current expectations, estimates, forecasts, and projections about the industries in which Snam operates and the beliefs and assumptions of the management of Snam. In particular, among other statements, certain statements with regard to management objectives, trends in results of operations, margins, costs, return on equity, risk management are forward-looking in nature. Words such as expects, anticipates, targets, goals, projects, intends, plans, believes, seeks, estimates, variations of such words, and similar expressions are intended to identify such forward-looking statements. These forward-looking statements are only predictions and are subject to risks, uncertainties, and assumptions that are difficult to predict because they relate to events and depend on circumstances that will occur in the future. Therefore, Snam s actual results may differ materially and adversely from those expressed or implied in any forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, economic conditions globally, political, economic and regulatory developments in Italy and internationally. Any forward-looking statements made by or on behalf of Snam speak only as of the date they are made. Snam does not undertake to update forward-looking statements to reflect any changes in Snam s expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based. The reader should, however, consult any further disclosures Snam may make in documents it files with the Italian Securities and Exchange Commission and with the Italian Stock Exchange. 25

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