26/03/2024
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Hera Spa
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Financial Results
Hera Group approves results as at 31/12/2023
2024-03-26 img_primopiano_BE2023_870_V2.png The year closed with main financial indicators rising and the targets included in the strategic Plan to 2026 exceeded three years ahead of schedule. The Group’s financial solidity and flexibility allowed it to continue along its path of industrial growth, increasing its investments and successfully grasping market opportunities, both internal and external, while continuing to generate value benefitting all stakeholders. The proposed dividend was raised, reaching 14 eurocents per share Financial highlights Revenues at 14,897.3 million euro Ebitda* at 1,494.7 million euro (+15.4%) Net profit* for shareholders at 375.2 million euro (+16.5%) Gross operating investments at 815.8 million euro (+15.0%) Net financial debt improves to 3,827.7 million euro (-10%), with Net debt / Ebitda* at 2.56x Proposed dividend rises to 14 eurocents per share (+12%) Operating highlights Strong performance from internal growth with contributions coming from acquisitions Significant contributions from the energy area, growth in the waste management sector, and network resilience pending the adjustment of the tariff return effective from 2024 Consolidation of ranking as Italy’s first operator in the waste management sector, second in water and third in energy Shared-value Ebitda rises sharply to 776.0 million euro (+16%) and shared-value investments amount to 558.4 million euro (69% of total investments) Today, the Board of Directors of the Hera Group, chaired by Executive Chairman Cristian Fabbri, unanimously approved the consolidated financial results as at 31 December 2023 and the Report on remuneration policy and compensation paid, as well as the Sustainability report. Cristian Fabbri, Executive Chairman of Hera Group: “We closed 2023 with record performance in our main operating and financial indicators, achieved within a macroeconomic environment that was volatile and uncertain. Ebitda reached almost 1.5 billion, net profit attributable to shareholders grew by 16.5% and investments were up by 15%, exceeding 800 million euro. As a result, the economic value distributed to stakeholders in the areas in which we operate reached 2.3 billion euro, up 36%. We achieved these results mainly thanks to the contribution coming from the waste management and energy areas. In the energy area in particular, we achieved significant growth supported by commercial development, last resort markets and energy efficiency services. At the same time, debt fell by 10%, bringing us to a Net debt / Ebitda ratio of 2.56x, allowing the Board of Directors to propose a 12% increase in dividends, equal to 14 eurocents per share. The 2023 results thus confirm the validity of our Group’s strategic vision and constitute the solid building block of our new business plan, approved in January.” Orazio Iacono, CEO of the Hera Group: “In 2023, Ebitda exceed the targets set in the previous Plan to 2026 three years ahead of schedule. The normalisation of energy prices made it possible to reduce net working capital achieving a significant financial structure and a Net debt / Ebitda ratio of 2.56x. The Group thus regained its usual financial flexibility and can continue to seize further growth opportunities in its reference markets, still highly fragmented. Evidence of this lies in the transactions carried out in 2023, which also confirm our focus on generating sustainable growth in the local areas served. This commitment was confirmed by the increase in both shared-value Ebitda, up by 16% to 776.0 million euro, 52% of overall Ebitda, and in CSV investments, which amounted to 558.4 million euro in 2023, approximately 69% of total investments. Finally, we proved our ongoing commitment to sustainable finance, a driving force for our investment plan and confirmation of our desire to create value in the areas served, with particular attention going to objectives including decarbonisation, circular economy, innovation and resilience, consistent with our corporate purpose and the path set out by the Business Plan.” Record year for the Group, that continues to create value for stakeholders and increase its scope of operations Thanks to effective choices made by management and the numerous development actions implemented, which also made it possible to seize market opportunities, the Hera Group closed the 2023 financial year with main operating results showing strong growth compared to the previous year. In particular, the Group leveraged its financial flexibility to successfully participate in recent last resort market tenders, and to acquire strategic assets in the waste management area. In a year characterised by an international geopolitical situation that remained unstable, with high energy market volatility in the first half of the year and prices that have not yet returned to the levels seen prior to the crisis, as well as a series of extreme weather and climate phenomena that affected the areas served, the Hera Group has continued to ensure service continuity and quality and the creation of value for all stakeholders. This concrete and transparent value was quantified through shared-value Ebitda and investments, with the data in question subjected for the fifth consecutive year to an external auditing company in order to validate these distinctive aspects of the Group’s reporting to all stakeholders. Hera pursued corporate growth and, at the same time, sustainable development, as shown by the increased investments in innovation and resilience of the assets managed, the circular economy and the energy transition, with concrete projects consistent with major national and international policies. In addition to internal growth, in 2023 Hera continued to expand its scope of operations through external development, with the aim of providing its customers with increasingly innovative and competitive solutions. In the waste management area, the new plant for biomethane and compost production in Spilamberto, near Modena, became fully operational, as did the partnership with A.C.R. di Reggiani Albertino, an important company operating nationwide in remediation, industrial waste treatment, decommissioning of industrial plants, and civil works related to the oil & gas sector. In the IT-TLC sector, the acquisition with Ascopiave of 92% of Asco TLC, followed by its merger by incorporation into Group subsidiary Acantho, enabled Hera to enhance its connectivity, telephony and data centre services in more than one region of Italy. In the area of renewable energy, acquisitions concerned the Ferrara-based company Tiepolo, for the construction of a photovoltaic solar park in Bondeno in Ferrara province, and of 60% of the Rimini-based company F.lli Franchini, involved in installing plumbing and electrical systems and photovoltaic solutions for business customers. The Hera Group and Orogel company also established the NewCo Horowatt for the construction of a sustainable, state-of-the-art agrivoltaic plant at the Cesena facilities owned by this agricultural cooperative. In the energy area, in November 2023 the Hera Group’s holding in EstEnergy, the largest energy operator in Northeastern Italy, rose to 75%. Furthermore, as regards the valuable intangible asset represented by its customer base, in February 2024, 7 lots were awarded in the national tender called by the Single Buyer for the gradual protection service for non-vulnerable domestic customers. The liberalisation process in the electricity sales market will lead to the entry, as of 1 July 2024, of more than 1 million new customers in the electricity service, further consolidating the Group’s position as the third largest operator in the energy sector nationwide. Lastly, as regards creating value, the Group continued to show its commitment to sustainable finance. In 2023, more than 1 billion in financing was allocated to the green transition, thanks to the issue of the Group’s second sustainability-linked bond, which included carbon neutrality and circular economy objectives, and the Revolving sustainability-linked credit line obtained. In addition, Hera obtained a dedicated loan from the European Investment Bank (EIB) for more than 60 Group projects, mainly intended for the Emilia-Romagna, Veneto and Friuli-Venezia Giulia regions and aligned with the European Taxonomy that, in addition to responding to the objectives set by the UN Global Agenda 2030, will accompany the communities served towards an ecological transition strongly rooted in the social and industrial fabric. Thanks to this strong focus on green finance, the portion of the Group’s debt financed with ESG instruments has progressively increased over the years, reaching 57% in 2023. Revenues at approximately 15 billion euro The Hera Group’s 2023 revenues amounted to 14,897.3 million, down from 20,082 million in 2022 (-25.8%), mainly due to the normalisation of energy commodity prices and gas volumes, lower trading and the mild weather seen in the first part of the year. This decrease was partially offset by higher electricity volumes sold, thanks to commercial activities related to the sale of value-added services and solutions for energy efficiency and self-generation, Consip tenders, the 2 lots of the safeguard service awarded for 2023-2024 and the gradual protection service for supplying electricity to micro-businesses starting from 1 April 2023. Revenues in the waste management sector were also up, due in particular to new operations in the industry market, above all the partnership with Modena-based A.C.R di Reggiani Albertino. Ebitda* rises to almost 1.5 billion euro (+15.4%) Ebitda* for 2023 increased to 1,494.7 million, up 15.4% compared to the 1,295.0 million recorded at 31 December 2022. This growth is due to the overall contribution coming from the energy areas, amounting to 169.4 million euro, especially thanks to commercial development, last resort market tenders and opportunities arising from incentives for energy services. A good performance also came from the waste management area, up 15.4 million euro, while the water cycle contributed with 9.5 million euro and the other services area with 5.4 million euro. Ebit* increases to 741.0 million euro (+18%) Ebit* rose to 741.0 million euro, +18% compared to 2022, with growth exceeding that of Ebitda*, since depreciation, amortisation and provisions increased less than the rise in Ebitda. Net profit* increases to 417.0 million euro The tax rate for the 2023 financial year stood at 26%, unchanged from 2022, thanks to nonrecurring concessions, tax credits for the purchase of electricity and gas, and benefits from the redemption of certain higher values arising from corporate acquisitions. Net profit* at 31 December 2023 also rose by 12%, reaching 417.0 million euro, as against 372.3 million during the previous year. Net profit* attributable to shareholders rises Net profit* attributable to shareholders amounted to 375.2 million, up 16.5%. Increased investments and improvement in net financial debt In 2023, the Hera Group’s operating investments, including capital grants, reached 815.8 million euro, up 15.0% compared to 709.5 million in 2022. Investments were mainly allocated to work on plants, networks and infrastructures, in addition to regulatory adjustments in gas distribution for the large-scale meter replacement, as well as the purification and sewage sector. This effort towards investing in the industrial growth of the Group’s regulated activities led its RAB to rise to 3.33 billion euro, up by 144 million euro compared to 2022. Net financial debt decreased to 3,827.7 million euro, as against 4,249.8 million as at 31 December 2022, mainly due to the positive performance of net working capital* caused by the progressive reduction in energy commodity prices compared to the amounts seen in late 2022, the increase in tax credits for subsidiary Hera Servizi Energia (due to the acceleration of works incentivised by expiring tax bonuses), the decreased VAT position and the lower value of gas storage, both in terms of prices and volumes. The Group’s financial structure therefore showed significant improvement, with the Net debt / Ebitda* ratio decreasing to 2.56x, compared to 3.28x at 31 December 2022. The result from operations recorded a double-digit return on equity (ROE*), coming to 11.1%. Return on invested capital (ROI*) also improved, rising to almost 10% (9.8%), as against 7.9% in 2022 and above the figures seen prior to the crisis, with an increase in value creation, due to both higher margins and a decrease in invested capital, as a result of the normalisation of net working capital. Shared-value Ebitda and investments up to 776.0 million (+16% compared to 2022) and 558.4 million (69% of total investments) respectively As confirmation of the Group’s commitment to sustainability and creating value in the areas served, 2023 shared-value Ebitda, referring to business activities that respond to the objectives of the 2030 UN Global Agenda, rose to 776.0 million, up 16% from 670.3 million in 2022 and corresponding to 52% of overall Ebitda. This result is in line with the direction defined by the Business plan and the goal of reaching over 1 billion euro in 2027 (equivalent to 64% of total Ebitda), along a path that generates concrete benefits for the local areas and communities served, alongside the company’s own development. Shared-value investments also rose, amounting to 558.4 million in 2023, roughly 69% of total gross operating investments. Moreover, about 92% of the investments eligible for the Taxonomy are already aligned with the criteria of this European Regulation and thus contribute to environmental objectives including climate change mitigation, circular economy, water resource protection and pollution prevention. The Hera Group’s best practices in ESG factors led it to be confirmed, for the fourth consecutive year, as part of the Dow Jones Sustainability Index, World & Europe, one of the world’s most authoritative stock market indices for evaluating social responsibility, with the highest rating in the Environmental and Social areas for companies in the Multi & Water Utilities sector. Furthermore, Hera was confirmed as a European leader in terms of commitment and transparency in the fight against climate change, achieving the “A-” level in the assessment drawn up by CDP (formerly the Carbon Disclosure Project), the international non-profit organisation specialising in assessing the climate strategies and performance adopted by companies. Proposed dividend increases to 14 eurocents per share Consistently with what was announced last January when presenting the Business plan to 2027, and in consideration of the significant results achieved, the Board of Directors decided to propose to the Shareholders Meeting held on 30 April to pay a dividend coming to 14 eurocents per share, up 1.5 eurocents compared to the last dividend paid (+12%). This increase will be extended to the entire dividend policy for the period covered by the Plan, reaching 16 eurocents per share in 2027, with net earnings per share rising by an average of 7% per year. The ex-dividend date has been set for 24 June 2024, with payment as of 26 June 2024. The dividend will be paid to the shares recorded on 25 June 2024. Report on remuneration policy and compensation approved The Board of Directors also approved the Report on the remuneration policy and compensation paid, in line with international best practices. Gas Ebitda* for the gas area, which includes natural gas distribution and sales, district heating and energy services, amounted to 516.9 million euro at 31 December 2023, as against 585.1 million in 2022. The decrease in Ebitda for the gas area is linked both to reduced volumes, due to the mild weather seen in the first part of the year, and lower margins for storage and trading activities, as well as the opportunities arising in the energy services segment from incentives for energy efficiency in households (110% super-bonus and insulation bonus) and the increased customer base, partially due to the last resort market and Consip tenders awarded. In particular, Hera Comm was awarded 8 of the 9 lots of the last resort gas service in 16 regions for the period from 1 October 2023 to 30 September 2025, all 9 lots of the gas default service tender and 3 lots of the Consip tender for supplying natural gas to public administrations in 2023-2024. The overall number of gas customers increased to 2.1 million (+1.3%). In 2023, net investments came to 190.9 million euro (+22.4% compared to 2022), mainly going to distribution, involving nonrecurring maintenance and development of networks and plants, smart gas meter commissioning, including the innovative NexMeter patented by Hera, initiatives related to acquiring new customers, district heating and energy services, with the activities of the company Hera Servizi Energia, and work on networks and plants. In the Udine area, 2023 saw the start of the gas distribution service for the 18 municipalities included in the ATEM Udine 2, following the tender awarded to AcegasApsAmga in late 2021. The new service contract includes over 90 thousand users, distributed along a network coming to over 1,200 km. At the end of the year, the second phase of experimentation, involving the first trials of this kind in Italy, was completed in Castelfranco Emilia, near Modena, on the use of a mixture of methane and hydrogen (2%), in a municipal gas distribution network. This asset readiness test on the network is part of Hera’s strategy to promote green gas, in line with EU indications, and allowed it to include gas distribution among the eligible activities for the European Taxonomy. The two Hydrogen Valleys under construction, in Modena and Trieste, which will produce about 800 tonnes per year of green hydrogen, will be home to photovoltaic parks to power the electrolysers, contributing to the decarbonisation of the industrial and local public transport sectors and, more generally, local areas in question, while at the same time redeveloping disused areas. The plants will be completed by 2026, partially thanks to NRRP contributions. The development of a supply chain for this renewable energy vector will therefore have significant and positive environmental, social and economic consequences. The gas area accounted for 34.6% of Group Ebitda. Electricity The electricity area, which mainly includes services in electricity distribution and sales, saw a sharp rise in Ebitda, which came to 309.2 million euro, as against 71.6 million in 2022. This was mainly due to sales activities, that benefitted from lower modulation charges compared to 2022 and a significant increase in the customer base, in both traditional and safeguarded markets. Value-added services were up, with increased earnings coming to approximately 3 million euro, partially thanks to the entry of the company F.lli Franchini within the Group’s scope of operations, in a partnership that brought new technical skills to Hera and expanded its portfolio of solutions for business customers, further strengthening its presence in the Italian energy market. One of the M&As aimed at supporting decarbonisation and electrification of consumption in the communities served was the aforementioned acquisition of the company Tiepolo for the construction of a photovoltaic solar park in Bondeno in Ferrara province. In addition, 4 lots of the Consip electricity tender for supplying electricity to public administrations in 2023 were awarded, in Rome, Campania, Calabria and the Italy lot; 3 lots of the gradual protected service for supplying electricity to SMEs for the period from 1 July 2021 to 30 June 2024, in 9 regions; 2 lots of the safeguarded service for 2023 and 2024, in 4 regions; 1 lot of the gradual protected service for supplying electricity to micro-businesses from 1 April 2023 to 31 March 2027, in 2 regions and 3 provinces in the North-East Italy. Electricity customers rose above 1.7 million (+19.2%), with growth occurring especially on the free market, thanks to reinforced commercial actions. Customer appreciation and loyalty was also confirmed, thanks to the value-added services offered by the Group. In particular, the market positioning strategy pursued by the Group led it to capitalise on the success achieved in all tenders in last resort services (both gas and electricity), supporting strong growth in results and laying the foundations for further market development. In the electricity area, gross and net investments amounted to 124.5 million, up 59% compared to the previous year. The interventions carried out mainly concerned nonrecurring maintenance on plants and distribution networks in the Modena, Imola, Trieste and Gorizia areas; a large-scale meter replacement and improvements in network resilience. Requests for new connections also increased slightly compared to the previous year. The electricity area accounted for 20.7% of Group Ebitda. Water cycle Ebitda for the integrated water cycle area, which includes aqueduct, purification, and sewerage services, amounted to 271.4 million euro, up from 261.9 million in the previous year, fully offsetting the increase in network and plant operating costs due to the rise in prices for materials and services. In addition, the Group was able to more than compensate for the considerable effect of inflation on costs, which was only recognised in tariffs as of 1 January 2024. Also note ARERA’s recognition of the significant investments, state-of-the-art plants and use of the best technologies for an efficient management of the water cycle in the areas served, in line with the Group’s sustainability and circular economy strategies. In particular, the Hera Group was awarded first and third place in the overall ranking of Italian utilities, proving the very high-quality standards adopted in managing this service. Including capital grants, investments amounted to 228.2 million euro (+9.7%), mainly going to extensions, reclamations and upgrading on networks and plants, as well as regulatory adjustments mainly in the purification and sewerage areas. The main interventions concerned the aqueduct, with ongoing reclamation activities on networks and connections, as well as major nonrecurring maintenance and restoration work following the flood emergency in May 2023. Considerable maintenance work continued on the intake from the Setta river, serving the Sasso Marconi drinking water treatment plant near Bologna, as well as upgrading on water networks in other areas served and a large-scale meter replacement. Furthermore, development began on the project for the new Castel Bolognese supply system in Ravenna province, and on the significant reclamation of a water adduction pipeline from Pontelagoscuro to Ferrara. In the sewerage sector, work continued on the Rimini seawater protection plan, one of the largest state-of-the-art works in Italy of its kind, and in network redevelopment and drain upgrading in other regions. In purification, note the construction of the new power-to-gas plant at the IDAR purifier in Bologna, as well as the expansion of the San Giovanni in Persiceto plant near Bologna, and ongoing revamping of the Gramicia purification plant in Ferrara. 2023 was also an important year for the consolidation of relations between the networks of the Friuli-Venezia Giulia and Veneto integrated water system managers, in order to improve the resilience of these systems, and projects financed by the NRRP, among others, were launched. Also note the interventions in the area of climate change to prevent flooding in both Trieste, with interventions on streams, and Padua, with nonrecurring cleaning and connections for new sewerage networks. The integrated water cycle area accounted for 18.2% of Group Ebitda. Waste Ebitda for the waste management area, which includes waste collection, treatment and disposal services, rose to 353.4 million euro, up 4.6% from 338 million in 2022, mainly due to the good performance of the waste treatment area, whose Ebitda came to 294.4 million, up 16.9 million, while Ebitda for environmental services involving collection and sweeping amounted to 59.0 million. The contribution from changes in the scope of consolidation due to recent acquisitions, the excellent performance of energy management and the higher volumes treated offset the increased costs due to inflation, the closure of the Ca’ Lucio landfill in the Marche region and the negative trend in the recovery market. In special waste treatment, the results of subsidiary ACR, which recently entered the Group’s scope of operations, were particularly noteworthy, creating approximately 4 million euro in synergies thanks to its full integration into the Group’s activities. The Hera Group is Italy’s leading operator in the waste management sector and operates in the complete waste cycle with approximately one hundred municipal and special waste treatment and plastic regeneration plants. The care and attention Hera gives to its set of plants has always set it apart, including ongoing efforts to equip plants with the best available technologies and achieve growth in this sector, favoured by regional expansion and its solid management and commercial policies. In 2023 as well, the main lines of development characterising the evolution of the Group’s activities were confirmed, transforming waste into resources with a view to the circular economy. One example of this is the new plant that became fully operational in 2023 in Spilamberto, in Modena area, born from the partnership between Herambiente and Inalca by converting an old biodigester into a state-of-the-art plant to transform organic waste and agrifood waste into 100% renewable methane and compost, making a concrete contribution to decarbonisation. Its annual production of about 3.7 million cm of biomethane will avoid the use of fossil fuels amounting to roughly 3,000 TOE (tonnes of oil equivalent) and 7,000 tonnes of CO2 emissions into the atmosphere. Protecting environmental resources was therefore confirmed as a priority objective, as was their maximal reuse. This is also proven by the special attention dedicated to increasing sorted waste collection, which, thanks to the strong commitment that the Group has made in all areas served, rose to 72.2%, up 4.4% compared to 67.8% seen in 2022. Gross investments in the waste management sector amounted to 150.8 million euro, mainly involving maintenance and expansion of the set of plants. This includes, for example, in addition to the previously mentioned new plant built in Spilamberto, the revamping on the Trieste waste-to-energy plant and the Ravenna F3 plant, as well as preparatory work for constructing Aliplast’s innovative rigid plastics regeneration plant in Modena. The waste management area accounted for 23.6% of Group Ebitda. Special items and operational adjustments / balance sheet reconciliation IFRS financial statements Income statement Statement of financial position 20240326 Press release Hera FY23 results.pdf 12:47:00 img_BE2023_110x150V2.jpg
Online dal 26/03/2024
alle ore 12:47
