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2015 Overview
Yet another year of growth for the Hera Group which, in line with its solid track record, continues down the path it has set out: the creation of value for its own shareholders.
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Global consolidate results

The Group, in 2015, showed growth in all indicators: EBITDA rose by 1.9%, operating profits by 0.2% and net profits for shareholders by 9.5%. These results prove to be all the more significant given that they were obtained in an increasingly challenging context as regards all economic, regulatory and competitive factors. Hera once again confirms its own outstanding role among operators in the sector, thanks to its consolidated multi-business strategy, which guarantees the possibility of acting in an economically and financially balanced way.


+6.7% 4,818 mln total revenue
+1.9% 884 mln EBITDA
+0.2% 442 mln EBIT
+9.5% 181 mln net profit
Business sectors

Data by business

integrated water cycle
investor kit
The Group's brilliant performance in 2015, the benchmark with peers and the analysts' evaluations
Gas Integrated water cycle Environment Electricity
EBITDA '14 Networks Waste Energy
Results Capex and cash flow Debt/Ebitda DPS

Hera shares and the creation of value for shareholders.

For the fourth consecutive year, Hera shares recorded a positive performance, superior to the trend seen in the Italian stock market as a whole, furthermore showing a degree of instability and risk equal to half that of the average of listed shares. In 2015 the stock price in fact progressed by +25.2% compared to the +15.4% of the FTSE All-Share, passing from € 1.952 at the end of 2014 to € 2.444.

Shareholder structure at 31/12/2015

Meet the Team

The IR team provides information on financial data and on Hera equity.

Contact us

Meet the Team

via Carlo Berti Pichat 2/4
40127 Bologna
TEL. 39 051 287040
MAIL IR@gruppohera.it


Information on financial figures, data processing and analysis

+39 051 287034



IR Communication, road show & events

+39 051 287040



Director of Investor Relation

+39 051 287737


Stories to tell

Investing in excellence: tales of voyages, big data, respect for the environment, values for people.

Over the past financial year, the Group continued along its path of technological, social and operational innovation, best represented by certain projects that have been recognised nationally and internationally for the excellence of their contents. An incredibly smart lamppost, biogas extracted from waste, a long voyage intended to give Hera a voice in the world's most important Markets, the ability to make the most of everyone's work, differences and specificities used as the key to success in extracting synergies: these are only a few examples of what has been done in less than a year. All of this demonstrates that to believe in Hera is to support uninterrupted growth in the creation of value, with foundations that rest upon innovation and sustainability.

To believe in Hera is to invest in technology, professionalism, values and EXCELLENCE, contributing to write beautiful stories, all of which, invariably, come to a HAPPY ENDING.

  • 100% Local Biogas
  • SMART illumination: a truly intelligent lamppost
  • Hera roadshow
  • Where do Amga Udine synergies come from?

100% Local Biogas

One outstanding project in the area of sustainable innovation developed in 2015 involves renovating and upgrading the composting plant in Sant'Agata Bolognese, which will host a section of anaerobic digesters and a purification system for the biogas produced. This plant will be able to treat, every year, 100,000 tonnes of organic sorted waste, producing approximately 6,300,000 standard m3 of biomethane (later to be distributed in the network), in addition to roughly 20,000 tonnes of biocompost. The Sant'Agata plant thus represents an excellent crossover between sustainability and technology, because the gas produced not only derives from recycled materials that would otherwise be completely lost, but the production also comes about within the local area in which the materials are gathered, actually producing 100% local biofuel and fertilising compost.

The authorisation phase will take place in the first six months of 2016, and all that is required for the plant to become fully operational will be concluded within the first three months of 2018.

To learn more

SMART illumination: a truly intelligent lamppost

The 23rd annual ISTAT report entitled "The situation of the country" links Italy's economic health quite closely to urban development, thus increasing the importance of national projects dedicated to the SMART CITY.

Among the indicators selected, one finds a wide range of issues related to smart mobility, energy efficiency, sustainable development, services for citizens, social innovation and greater value given to the environment.

(See Istat archive)

This is the large-scale reference scenario in which the projects developed by Hera in 2015 find their natural place, all strongly oriented as they are towards the environment and innovation. The fiscal year in question saw Hera's project for a multi-task lamppost get off the ground; above and beyond the traditional function expected of it, i.e. illuminating areas within the city and in surrounding areas, it also truly represents a tool with which to implement urban big data systems.

A few further instruments are in fact connected to it, which implement its potentialities and functions:

In 2015 the Group installed a prototype lamppost, in order to evaluate its performances and its possibilities of being implemented, in the city of Forlμ.

This lamppost is provided with the following technologies:

  • Video-analysis
    • Person and car count
    • Intrusion, with alarm systems for prohibited entry in defined areas
    • Video push, with a remotely activated function enabling video recordings of the area monitored to be saved on servers
  • Environmental sensor to monitor levels of CO, CO2 NO2, O3 , E, PM10, T, U GEIGER
  • RFID reader able to give off a sound message
  • Emergency call
    • Smart parking operating by way of devices including ground probes and parking apps, with possibilities including electronic payment, signalling free parking spaces, guided navigation to the area
  • Wi-fi hot spot
  • LED illumination

The intelligent lamppost is one of the many projects Hera has developed around the notion of the SMART CITY, in line with the value the Group gives to excellent and sustainable technological development. It provides, in fact, a series of in-depth data in various sectors, whose common denominator is the improvement of the quality of life for citizens.

Hera roadshow

Our ongoing dialogue with Public, Institutional and Retail shareholders played, in the 2015 financial year once again, a decisive role among the various activities pursued by our Investor Relations management.

Over the entire year, our senior Management participated in Road Shows and Conferences dedicated to specific issues, in order to present Hera stocks to the Italian and international markets.

In line with the transparency and constant communication with the Market that the Group has always maintained, January 2016 marked the beginning of a road show that led the upper levels of management  to be engaged in presenting the 2015-2019 Business Plan to national and foreign investors.

Meetings were held in numerous locations: as regards Europe, in addition to Milan, London, Paris, Zurich and Geneva, this year Executive Chairman Tommasi di Vignano and CEO Venier, accompanied by IR Manager Jens Hansen, presented the Group's history and its future projects to important investment funds based in Brussels and Frankfurt. In the United States, meetings were held in the most financially significant cities of the country, that is, Boston, Chicago and, confirming a prestigious and long-standing tradition, Hera was present in the buildings bordering on Wall Street, in a New York covered in snow. The Road Show, scheduled for the first time in "low season" , in the middle of winter, in fact took place in rather rigid temperatures, amid cold winds and flakes of snow, but the results obtained were decidedly the opposite of the adverse weather, in that the investors gave a warm welcome to the Group's team, demonstrating their acute interest both for the financial results achieved until present, and for those that have been planned for the future. The market furthermore confirmed its trust in the value of our management and stocks, whose trend surpassed that of other companies in the sector during the entire duration of the road show, to the point that, in the first few months of the year, it was superior to the FTSE all-share index by over 16 percent.

The stock's positive performance shows that Hera, today, is a company with an excellent standing, whose solid, innovative and sustainable approach is able to attract leading international investment funds as well. The global market was willing to generously listen to our top management, and this fact further confirms the unquestionable credibility represented by the promise contained in our five-year plan through 2019.

To know more: Road Show investor presentation.

Where do Amga Udine synergies come from?

Gas tenders

Consolidate its presence in reference territories through the discontinuity of gas tenders.

Commercial activities

Extract value from AMGA Energia & Servizi's customer base through:

  • sharing  Hera Comm business model (becoming a Hera Comm company);
    • development  of dual-fuel strategies;
    • cross-selling on the existing customer base;
    • switching customers from protected market to liberalized;
    • reinforcement  of the upstream integration.
  • sharing Hera's know how in heat management and in the tailored solutions of services for top client (e.g. cogeneration, renewable, TLR)

Streamline of the BULGARIA's branch

Streamline of the Bulgarian branch, which is on of the biggest player in gas distribution, unifying strategies and maximizing value of the investment.

Gas Distribution

  • Efficiencies in the O&M process (know-how transfer);
  • Remote control concentration in networks;
  • Workforce Management introduction;
  • Cost reduction thanks to centralized spending policies;
  • Investment portfolio optimization;
  • Optimization of the presence in Bulgaria (BSTC, Rilagas);
  • Tax Rate improvement (no Robin Tax).

Gas sales

  • Extension of the Group's trading platform (in raw materials purchasing);
  • Efficiencies on commercial and post-sale activities (e.g. shops, call centre, campaign management);
  • Working capital and bad debt reduction deploying Hera know how.

Cross-business e personale

  • Rationalization of legal entities reducing overhead costs;
  • Procurement: volumes concentration, price benchmarking, alignment of the supplier base;
  • Deploying Hera IT systems;
  • Rationalization of the holding activities and G&A integration.
Annual report
in summary

In line with its sustainability policy, Hera Group promotes the consultation of financial reporting through the web. Therefore a HTML version of Consolidated Financial Statements as at December 31, 2015 was designed, for an easy online reading.

However, in case of need, the entire Y2015 file or just the section of interest can be downloaded and printed with a simple click.

Letter from the Chairman to the Shareholders

"We are therefore confident that you will appreciate the results of our operations and the transparency of their presentation, prepared as always to meet the challenges that await the Group."

The Chairman of the Board of Directors
Dott. Tomaso Tommasi di Vignano

Read more

Directors' Report

Operating results and investments

The Hera Group, at the end of the year under review, showed growth in all economic indicators: EBITDA rose by 1.9%, operating profits by 0.2% and net profits by 6.6%. These results are all the more significant considering that they were achieved in an increasingly challenging scenario, as defined by numerous economic, regulatory and competitive factors. Within this context, the Hera Group proved able to confirm its standing as one of the sector's main operators thanks to its consolidated multi-business strategy, which guarantees a balanced range of economic and financial actions.

Constant and balanced growth in results

In 2015, development objectives were pursued through both organic growth, extracting synergies with activities in corporate rationalisation, and external lines, the latter involving in particular the waste treatment business. The following corporate operations allowed the Group to maintain its sector leadership and to consolidate its presence in the collection and disposal market:

  • Effective as of 1 July 2015, the waste disposal activities carried out at two WTE plants for the municipalities of Padua and Trieste were transferred from AcegasApsAmga to Herambiente, giving birth to the company Hestambiente. Herambiente controls 70% of the latter, and the remainder is controlled by AcegasApsAmga.

  • Herambiente acquired the following companies over the course of 2015: Akron, of which it became the sole shareholder during the first semester of 2015, Romagna Compost, of which it became the sole shareholder during the second semester of 2015, and Herambiente Recuperi. All acquisitions were backdated to 1 January 2015.

  • As of 1 November 2015, Biogas 2015 became part of the Group's corporate structure. This company's activities involve energy recovery and energy production from waste recycling, and it is also responsible for constructing, installing and managing the plants involved.

  • As of 1 December 2015, Herambiente acquired control of a few branches of Geo Nova Spa. In particular, the dangerous and non-dangerous waste storage plant in San Vito al Tagliamento (near Pordenone) and the active landfills for non-dangerous waste in Loria (near Treviso) e Sommacampagna (near Verona) were taken over. For 2015, the acquired company branches are included in the Group's economic results only as regards the month of December.

  • On 23 December 2015 Herambiente acquired 100% of shareholding in Waste Recycling Spa, whose activities involve the treatment and recovery of special waste in the province of Pisa, and that in turn holds shares in Rew Trasporti Srl and Neweco Srl. For the 2015 financial year these companies participate in the process of Group consolidation only as regards their assets.

  • On 29 December 2015 Hera Spa sold 90% of Hera Energie Rinnovabili, later renamed Aloe Spa, to third parties. It therefore no longer falls within the Group's consolidated scope, and its contribution to the 2015 statements is only economical.

  • This consolidated income statement reflects the application of accounting principle IFRIC12 "Service concession arrangements". The effect of applying this principle, which leaves the results unchanged, is That investments made in goods granted under concession, only including network services, are acknowledged in the income statement.

Constant and growing increments

Income statement (mln €)Dic 2015Inc%Dic 2014Inc%Var.Ass.Var%
Other operating revenues330.87.4%325.57.7%+6.3+1.9%
Raw materials(2,256.6)-50.3%(1,965.5)-46.9%+291.1+14.8%
Service costs(1,132.1)-25.2%(1,143.6)-27.3%-11.5-1.0%
Other operating costs(62.3)-1.4%(57.1)-1.4%+5.2+9.1%
Personnel costs(510.8)-11.4%(496.9)-11.9%+13.9+2.8%
Capitalised costs28.50.6%17.30.4%+11.2+68.4%
Amort. & Prov.(442.2)-9.9%(426.6)-10.2%+15.6+3.7%
Operating profit442.29.9%441.210.5%+1.0+0.2%
Financial operations(126.0)-2.8%(138.0)-3.3%-12.0-8.7%
Pre-tax profit316.17,0%303.27.2%+12.9+4.3%
Net profit adjusted202.64.5%181.24.3%+21.4+11.8%
Non-recurring financial charge(8.2)-0.2%(8.1)-0.2%+0.1+0.0%
Non-recurring tax income-9.30.2%-9.3-100.0%
Net profit of the year194.44.3%182.44.4%+12.0+6.6%
Attributable to:
Shareholders of the Parent Company180,54.0%164.83.9%+15.7*9.5%
Non-controlling interests13,90.3%17.60.4%-3.8-21.3%

4.5 billion in revenues

Revenues amounted to € 4,487.0 million in 2015, up € 297.9 million (7.1%) compared to the € 4,189.1 million seen in 2014. This growth is due to various factors: (i) gas, heat management and district heating services recorded an increase in volumes sold for roughly € 120 million on account of the colder weather compared to the same period in 2014; (ii) trading activities, involving both gas and electricity, showed an increase of roughly € 250 million due both to favourable market conditions over the summer months, allowing foreign exchange to increase, and greater activity in controlled thermoelectric plants; (iii) the growth in volumes of electricity sold for roughly € 38 million is linked to the trend in electricity demand and a rise in commercial activity. This increase was contained by the lower price of raw materials, in both the gas and the electricity areas, lower regulated distribution revenues, and lower revenues from the waste treatment area, owing to a drop in the amount of waste treated and a reduction in revenue from electricity production.

For further details, see the analyses of the single business areas.

Note, lastly, a reclassification between 2014 and 2015, for roughly € 10 million, of a number of entries in the chart of accounts from "other revenues and income" to "revenues" following the complete integration of AcegasApsAmga into the Group's IT systems.

Other operating revenues thus increased by € 6.3 million, due to € 15 million in higher revenues resulting from the application of IFRIC 12, contained however by the € 10 million reclassification mentioned above.

Costs of raw and other materials rose by € 291.1 million (14.8%) compared to 2014; as with revenues, this change is mainly due to the higher volumes of gas and electricity sold and more substantial trading activities, in spite of the lower cost of raw materials mentioned above.

Other operating costs dropped by € 6.3 million overall (lower costs for services, coming to € 11.5 million, and higher operating expenses, coming to € 5.2 million), thanks to lower costs for outsourcing contracts.

Personnel costs rose by € 13.9 million (2.8%), from € 496.9 million in 2014 to € 510.8 million in 2015. This increase is mainly linked to changes in the scope of consolidation, for € 7.1 million, caused by the merger of Udine into the Group, and salary raises established by the national labour agreement, coming to 2.3%.

Capitalised costs rose by € 11.2 million (64.8%) compared to 2014, due above all to the larger amount of operations carried out by Group companies.

EBITDA at € 884,4 million (+1,9%)

EBITDA went from € 867.8 million in 2014 to € 884.4 million in 2015, recording a growth of € 16.6 million (1.9%). This result was obtained thanks to the contribution of the Gas area, which increased by € 19.8 million, and the Integrated Water Cycle area, with € 15.4 million, which more than compensated for the decrease seen in other business areas.


Amortisation, depreciation and provisions rose by € 15.6 million overall (3.7%), going from € 426.6 million in 2014 to € 442.2 million in 2015. This increase is due to changes in the scope of consolidation for € 11.3 million, higher amortisations for new investments, higher risk provisions and higher provisions for doubtful debts, in particular in sales companies. This effect is partially compensated by a decrease in provisions in the waste treatment area, for the lesser quantity of waste disposed of in landfills, and lower depreciation on fixed assets.

Operating profits at € 442.2 million (+0.2%)

Operating profits at 31 December 2015 reached € 442.2 million, up € 1.0 million (0.2%), compared to € 441.2 million in 2014.

Operating profits

The result of financial management in 2015 came to € 126.0 million, dropping by € 12.0 million (8.7%) compared to 2014. The decrease is principally due to medium to long term debt management, in particular the rate efficiency obtained by refinancing activities through issuing the Green Bond in 2014, in order to partially buy back Bonds issued in 2006 and other minor debts. The higher profits seen in joint venture companies, thanks above all to the contribution of Est Energy, a sales company controlled by AcegasApsAmga, had a positive bearing on the results of financial management.

In light of the above, adjusted pre-tax profits rose by € 12.9 million, from € 303.2 million in 2014 to € 316.1 million in 2015.

Income taxes, recalculated without taking into account the non-recurring items seen in the previous year, fell from € 122 million in 2014 to € 113.5 in 2015. The adjusted tax rate improved significantly, passing from 40.2% to 35.9%. This improvement was mainly due to: the positive effect of the IRAP deduction for the cost of personnel hired with open-ended contracts; the elimination of the additional IRES, the so-called Robin Tax, previously applied to the Group's energy companies; benefits arising from the "patent box" and credit for activities involving research and development; and the "maxi amortisations" provided for by the 2016 Stability Law. All of this more than compensated for the negative effects caused by bringing deferred tax assets into line with the new IRES tax rates, set at 24%, effective beginning in 2017.

Adjusted net profits therefore rose by 11.8% (€ 21.4 million), going from € 181.2 million in 2014 to € 202.6 million in 2015.

2015 results were impacted by roughly € 8.2 million in net losses on financial assets, reclassified as non-recurring financial costs, mainly due to write-downs applied to the investment in SEI and related disbursed financing, as well as the loss incurred in the transfer of 50% of Elettrogorizia.  

Net profits therefore rose by 6.6% (€ 12.0 million), going from € 182.4 million in 2014 to € 194.4 million in 2015.

Net profits after minority interests at € 180.5 million (+9.5%)

Group profits came to € 180.5 million, rising by € 15.7 million on 2014, thanks among other things to a reduction of minority interests mainly derived from the complete acquisition of Akron and Romagna Compost.

Net profits


Analysis of the group's financial structure

The table below shows changes in the Group's net invested capital and sources of financing for the year ended 31 December 2015.

Group size increases

 Invested capital and sources of financing (€/mln)   31-dec-15  % Inc.  31-dec-14  % Inc.  Abs. Change  % Change 
 Net non-current assets  5,511.3  106.9%  5,445.8  106.8%  +65.5  +1.2% 
 Net working capital 157.0  3.0%  153.1  3.0%  +3.9  +2.5% 
 (Provisions)  (513.5)  -10.0%  (499.5)  -9.8%  (14.0)  +2.8% 
 Net invested capital 5,154.8  100.0%  5,099.4  100.0%  +55.4  +1.1% 
 Equity   (2,503.1)  48.6%  (2,459.0)  48.2%  (44.1)  (1.8%) 
 Long-term borrowings  (2,743.6)  53.2%  (2,969.3)  58.2%  +225.7  +7.6% 
 Net (cash)/short term borrowings   91.9  -1.8%  328.9  -6.4%  (237.0)  +72.1% 
 Net borrowings  (2,651.7)  51.4%  (2,640.4)  51.8%  (11.3)  (0.4%) 
 Total sources of financing   (5,154.8)  -100.0%  (5.099.4)  100.0%  (55.4)  (1.1%) 

Net invested capital reached €5.2 billion

In 2015, net invested capital grew by 1.1%, going from € 5,099.4 million in 2014 to € 5,154.8 million in 2015. The increase is due to net non-current assets (+1.2%), that rose from € 5,445.8 million in 2014 to € 5,511.3 million in 2015, thanks to the investments made and acquisitions of operating activities in the area of waste disposal.

Net invested capital

Net investments rise to €332.7 million

In 2015, Group investments amounted to € 332.7 million, benefiting from € 13.7 million in capital grants, of which € 2.3 million for the New Investments Fund (FoNI), as provided for by the tariff method for the Integrated Water Service. Including capital grants, the Group's overall investments came to € 346.4 million. Net investments grew by € 6.2 million, going from € 326.5 million in 2014 to € 332.7 million in 2015.

The following table shows total investments including capital grants, subdivided by sector, with the total amount of capital grants and separate mention of the FoNI: 

Totale Investiments
dec-15dec-14Abs. Change% Change
Gas area 87.4  79.8  +7.6  +9.5% 
Electricity area 27.6  27.5  +0.1  +0.4% 
Water cycle area   127.2  114.8  +12.4  +10.8% 
Waste management area   35.2  47.9  -12.7  -26.5% 
Other services area 15.3  14.8  +0.5  +3.4% 
Headquarters 53.3  61.4  -8.1  -13.2% 
 Total operating investiments 345.9  346.1  -0.2  -0.1% 
Total financial investiments  0.5  2.4  -1.9  -79.2% 
Total gross investiments   346.4  348.6  -2.2  -0.6% 
 Capital contributions   13.7  22.1  -8.4  -38.0% 
of which FoNI (New investiments Fund) 2.3  10.5  -8.2  -78,1% 
 Total net investiments 332.7  326.5  +6.2  +1.9% 

Strong commitment to investment in plants and infrastructures continues

Capital expenditure amounting to € 345.9 million was substantially in line with 2014 and mainly concerned interventions on plants, networks and infrastructures. In addition, updating activities were performed as required by new regulations mainly concerning purification and sewerage. Remarks on investments in each single area are included in the analyses by business area.

Group headquarters: investments in buildings, IT systems and fleets

At the Group's headquarters, investments concerned interventions on corporate buildings, IT systems and the vehicle fleet, as well as laboratories and remote control structures. Overall investments in structures fell by € 8.1 million compared to the previous year, prevalently due to the works done on company headquarters in 2014.

Net working capital amounts to €157.0 million

Net working capital remained fundamentally at the same level as the previous year, recording a slight increase of € 3.9 million. This result is highly positive, considering that overall credit management balanced out the negative trend in seen receivables due to customers benefiting from last resort services who cannot be disconnected. Receivables from this category of customers will be reimbursed by the Energy and environmental services equalisation fund (CSEA), in accordance with resolution 370/12 emitted by the Authority for electricity, gas and the water system (AEEGSI).

Provisions at € 513.5 million

Provisions amounted to € 513.5 million in 2015, recording growth over the previous year. This result is mainly due to provisions for the period, which compensated for usage expenses, and to the contribution of companies that became part of the scope of consolidation, as well as an adjustment of the TFR fund, calculated according to actuarial criteria. For further details on provisions, see the supplementary note.

€2.5 billion in equity

Equity rose from € 2,459.0 million in 2014 to € 2,503.1 million in 2015, benefiting the financial structure of the Group. Equity became more solid thanks to the positive net result achieved by management in 2015, coming to € 194.4 million.

ROI at 8.6%

Return on invested capital (ROI) came to 8.6% in 2015. This result, quite similar to the 8.7% seen in 2014, shows the impact of the partial economic contribution coming from company acquisitions in late 2015, with respect to the corresponding growth in Net Invested Capital. Net of this amount, ROI would have been equal to 8.7%.


ROE at 7.8%

Return on equity (ROE) went from 7.4% in 2014 to 7.8% in 2015. This result is due to the positive outcome of management in 2015, which benefited not only from the good results of the Group's characteristic management, but also from a good performance in financial management.


Reconciliation between separate and consolidated financial statementNet profitEquity
Balances as per separate financial statements172.02,260.9
Excess reported equity for the period over the carrying amount of investments in subsidiaries1.910.6
Consolidation adjustments:
- Measurements with the equity method of investments recognized at historical cost in the separate financial statements6.541.7
- Difference beetween purchase price and corresponding reported equity amount(1.8)69.2
- Elimination of intercompany transactions1.9(24.0)
Amounts attributable to non-controlling interests13.9144.7
Balances as per consolidated financial statements194.42,503.1

1Funds from operations are calculated by subtracting from EBITDA credit depreactions, financial burdens, taxes, usage of risk provisions.

Analysis of net cash (net borrowings)

An analysis of net borrowings is provided in the following table:

A solid financial position

 a  Cash and cash equivalents 541.5  834.5 
 b  Other current financial receivables 34.7  45.2 
   Current bank debt (129.2)  (175.6) 
  Current bank debt (284.9)  (302.2) 
 Other current financial liabilities (68.2)  (69.6) 
 Finance lease payments maturing whitin 12 months(2.0)  (3.4)
 c  Current financial debt   (484.3)  (550.8) 
 d=a+b+c Net current financial debt 91.9  328.9 
  Non- current bank debt and bonds issued (2,845.4)  (3,020.6) 
  Other non-curent financial liabilities  (5.8)  (7.0) 
  Finance lease payments mauturing after 12 months (17.6)  (25.3) 
 e Non-current financial debt   (2,868.8)  (3,052.9) 
 f=d+e  Net borrowings-Consob communication n. 15519 of 28/07/2006 (2,776.9)  (2,724.0) 
 g  Non current financial receivables 125.2  83.6 
 h=f+g  Net financial debt (2,651.7)  (2,640.4) 

The overall amount of net borrowings ("PFN") in 2015 came to € 2.651,7 million, and is quite similar to the figures from the previous year. The Group's financial structure at 31 December 2015 contains a current debt consisting in usage of current credit lines amounting to roughly € 129.2 million, shares of bank loans reaching maturity for roughly € 89.6 million and a share in reimbursement of the bond for € 195.4 million with repayment in February 2016. It furthermore shows a decrease compared to 31 December 2014 as a consequence of the reimbursement of the € 180 million loan from the European Investment Bank (EIB), dating to January 2015. The amount related to non-current bank debt and bonds is prevalently made up of bonds issued on the European market and listed on the Luxembourg Stock Exchange (77.5% of the total), with repayment at maturity.

As a whole, borrowings show an average term to maturity of over 8 years, with 68% maturing after more than 5 years.

Net borrowings: € 2.65 billion

Net borrowings went from € 2,640.4 million in 2014 to € 2,651.7 in 2015. This is mainly the result of the Group's positive operating cash flow, which wholly financed both dividend payments and the numerous M&A operations that took place above all towards the end of 2015.

Net Borrowings

The Group's characteristic management generated operating cash flows that allowed dividend payments to be covered in full, for a total of € 142.4 million.

Cash flow after dividend payment was therefore positive, amounting to € 64.8 million.

Cash flow

Net borrowings / Ebitda ratio at 3.0

The net borrowings/Ebitda ratio once again came to 3.0. This result shows the impact of acquisitions dating to late 2015 that partially contributed to Group economic results, only as of the moment in which they became part of the Group's consolidated scope. Net of these effects, the indicator in question would show growth and thus fully highlight the positive results of operational management that continues to guarantee an efficient coverage of net borrowings.

Thanks to this ratio, among other factors, Hera was given a 'Baa1' rating with a negative outlook by Moody's, and a 'BBB' rating with a stable outlook by Standard & Poor's.

Net Borrowings

20,5% FFO/PFN

The ratio between Funds from operations1 (FFO) and Net Debt went up with respect to the 2014 results. For the same reasons, this figure as well, like the previously discussed Net Borrowings/Ebitda ratio, suffers from consolidation operations, net of which it would record a further improvement, confirming the Group's growing financial solidity, due to the generation of operating cash flow which guarantees its ability to meet financial obligations.


1 Funds from operations are calculated by subtracting from EBITDA credit depreactions, financial burdens, taxes, usage of risk provisions

  • Gas
  • Electricity
  • Other services


An analysis of the results achieved by management in the various business areas in which the Group operates is provided below, including: the gas area, which covers services in natural gas and LPG distribution and sales, remote heating and heat management; the electricity area, which covers services in electricity production, distribution and sales; the integrated water cycle area, which covers aqueduct, purification and sewerage services; the waste management area, which covers services in waste collection, treatment, recovery and disposal; the other services area, which covers services in public lighting and telecommunications, as well as other minor services. The Group's income statements include corporate headquarter costs and reflect intercompany transactions accounted for at arm's length.

Contribution from various area to Group highlights a balanced mix

The following analyses of each single business area take into account all increased revenues and costs, with no impact on EBITDA, related to the application of IFRIC 12, as shown in the Group's consolidated income statement. The business areas affected by IFRIC 12 are: natural gas distribution services, electricity distribution services, all integrated water cycle services and public lighting services.

Gas segment

+1.6% increase in the Gas Area's contribution to Group EBITDA

All gas area performance indicators were up in 2015 with respect to the previous year, thanks to the higher volumes sold.


The following table shows the changes occurred in terms of EBITDA:

Gas Area EBITDA grows by 7.2%

(€/mln)Dec 2015Dec 2014Abs. change % Change 
Area EBITDA295.8276.0+19.8+7.2%
Group EBITDA884.4867.8+16.6+1.9%
Percentage weight33.4%31.8%+1.6 p.p. 

1.3 million gas customers

The overall number of gas customers rose by 0.8% over 2014, due to the commercial and customer loyalty initiatives set in place to contrast competition, as well as a wider customer base, in central Italy in particular, thanks to the acquisition of Alento Gas in May 2015.


Growth in volumes sold: +29.3%

Volumes of gas sold increased by 766.8 million m3 (+29,3%), going from 2,616.1 million m3 in 2014 to 3,382.9 in 2015. The main factors behind this performance are the higher amount of volumes sold (332.1 million m3) owing to both the colder temperatures in the winter of 2015 compared to 2014, the warmest of the last 30 years, the organic growth obtained through achieving a wider customer base, and a rise in trading volumes amounting to 434.7 million m3 (+12.8% of total volumes), due to both higher consumption and an increase in sales to the thermoelectric sector.


The following table summarises the income statement for the gas area:

Gas: increase in overall earnings

(€/mln)Dec 2015Dec 2014Abs. change % Change 
Area EBITDA295.8276.0+19.8+7.2%
Group EBITDA884.4867.8+16.6+1.9%
Percentage weight33.4%31.8%+1.6 p.p. 

Gas revenues at € 1,618.7 million

Revenues went from € 1,481.0 million in 2014 to € 1,618.7 million in 2015, with a € 137.7 million increase (9.3%), principally owing to: (i) a rise in trading activities for roughly € 68 million, thanks to both the favourable summer market, which allowed foreign exchanges to increase, and higher consumption in thermoelectric plants; (ii) growth in volumes of natural gas sold, for roughly € 112 million, and heat sold by the district heating service, for roughly € 8 million, due to the colder temperatures seen compared to the same period in 2014; (iii) higher revenues in regulated services for € 3.7 million, mostly due to the increase in the scope of consolidation caused by the acquisition of Amga Udine during the previous year, beginning on 1 July 2014. This increase is partially compensated by lesser revenues due to a drop in the cost of raw materials.

Operating costs rose by € 117.9 million, going from € 1,087.6 million in 2014 to € 1,205.5 million in 2015. This trend is linked to the increase in volumes sold, in spite of the lower prices mentioned above.


Gas EBITDA: € 295.8 million

EBITDA rose by € 19.8 million (7.2%), going from € 276.0 million in 2014 to € 295.8 million in 2015, thanks to the larger volumes sold in gas and heat, as mentioned above.


Net investments in the Gas Areas: € 86.5 million

In 2015, investments in the gas area came to € 86.5 million, recording an increase of € 7.4 million compared to the previous year. In gas distribution, the rise is mainly due to the Group's wider operating area thanks to AcegasApsAmga for Udine (2.0 million) and BSTC (0.4 million), in addition to a regulatory upgrading ex legislative decree 631/13 involving a massive meter replacement, which also concerned lower-class devices (G4-G6), as well as higher extraordinary maintenance on networks and plants, for an overall increase of € 5.6 million.

In the 2015 financial year as well, the effect of the overall economic situation continued to be felt, bringing about a further slowdown compared to the previous year in requests for new connections.

Investments grew by € 2.0 million in remote heating as well, an increase which is mainly due to a revamping done on the Barca cogeneration plant in Bologna and interventions on the Forlμ University Campus plant.

Details of operating investments in the Gas Area are as follows:

Investments grow

Gas (€/mln)Dec 2015Dec 2014Abs. change % Change 
Networks and plants67.962.3+5.6+9.0%
RH/Heat management19.517.5+2.0+11.4%
Total Gas Gross87.479.8+7.6+9.5%
Capital contributions0.90.6+0.3+50.0%
Total Gas Net86.579.1+7.4+9.4%

RAB at € 1.053 billion in 2015


RAB (Regulatory Asset Base), which fixes the value of assets recognised by the AEEGSI for return on invested capital, remained stable compared to 2014.

Energia elettrica

Electricity: drop in EBITDA

The 2015 financial year did not benefit from any non-recurring equalisation, unlike 2014, and for this reason the electricity area's contribution to Group EBITDA decreased, both in absolute terms and as a percentage.

Contribution to Group EBITDA: - 1.0%


The following table shows the changes occurred in terms of EBITDA:

Electricity area EBITDA falls by 6.1%

(mln €)Dec 2015Dec 2014Abs. Change% Change
Area EBITDA104.7111.4-6.7-6.1%
Group EBITDA884.4867.8+16.6+1.9%
Percentage weight11.8%12.8%-1.0 p.p. 

856.8 thousand electricity customers

The number of electricity customers recorded an increase of 7.7% (+ 61.6 thousand), mainly due to growth in the free market, which came to 14.3%, now totalling 66% of customers. This confirms the trend of growth seen in recent years, owing above all to a reinforcement of commercial activities, implemented during 2015 as well.


Volumes sold rise by 5.4%

Volumes of electricity went from 9,136.4 GWh in 2014 to 9,626.0 GWh modificare la tabella, GWh e Last resort per salvaguardia in 2015, with an overall increase of 5.4%. The rise in volumes sold was mainly caused by a reinforcement of commercial activities and an increase in consumption, in line with the trend in national electricity demand, which at 31 December 2015 increased by +1.5% compared to the previous year.


The following table summarises the income statement for the electricity area:

Income statement (€/mln)Dec 2015% IncDec 2014% IncAbs. Change% Change
Revenues1,614.8 1,442.3 +172.5+12.0%
Operating costs(1,471.5)-91.1%(1,296.5)-89.9%+175.0+13.5%
Personnel costs(46.7)-2.9%(41.3)-2.9%+5.4+13.1%
Capitalised costs8.00.5%7.00.5%+1.0+14.4%

Electricity revenues for € 1,614.8 million

Revenues increased by € 172.5 million (12.0%), going from € 1,442.3 million in 2014 to € 1,614.8 million in 2015. The main reasons for this growth are: (i) higher volumes sold for roughly € 38 million due to both an increase in demand for electricity and greater commercial activity; (ii) a larger amount of trading, for roughly € 184 million due to the favourable summer market that allowed foreign exchanges to increase; (iii) greater revenue from electricity production in thermoelectric plants due to both the increase in national demand and lesser usage of hydroelectric plants due to lesser rainfall in 2015. This increase in revenues was contained by the lower price of raw materials and the lesser regulated revenues in distribution services for € 9.9 million, owing above all to the non-recurring specific company equalisation in Gorizia in 2014, which came to € 9.2 million.


The rise in operating costs (+13.5%) is linked to higher costs of purchasing raw materials for trading, greater volumes sold, and higher costs of electricity production in plants.

Electricity EBITDA at € 104.7 million

At the end of 2015, EBITDA decreased by € 6.7 million (6.1%), going from € 111.4 million in 2014 to € 104.7 million in 2015, only on account of the lower non-recurring revenues with respect to 2014, as mentioned above, in regulated distribution services. The lesser EBITDA derived from dispatching services (MSD) is in fact more than compensated for by higher volumes and earnings for sales activities towards customers, including those benefiting from last resort services.

Net investments in the Electricity Area: € 27.6 million

Investments in the electricity area amounted to € 27.6 million, with an increase of € 0.2 million compared to the € 27.4 seen in the previous year. The interventions implemented mainly concerned non-routine maintenance of plants and distribution networks in the areas surrounding Modena, Imola, Trieste and Gorizia.

Compared to the previous year, a higher amount of non-routine maintenance was done on networks and plants, compensated by the lesser interventions on the Cogen plant in Imola as an effect of the work done during the previous year. In this area as well, connections showed a slight drop with respect to the previous year.

As regards industrial cogeneration for Energy Service activities, interventions rose by € 0.4 million compared to 2014.

The details of operating investments in the Electricity Area are as follows:

Electricity (€/mln)Dec 2015Dec 2014Abs.change%change
Networks and plants24,424,8-0,4-1,6%
Industrial cogeneration3,12,7+0,4+14,8%
Total Electricity Gross27,627,5+0,1+0,4%
Capital contributions0,00,1(0,1)(100,0%)
Total Electricity Net27,627,4+0,2+0,7%

RAB (Regulatory Asset Base), that defines the value of assets recognised by the AEEGSI for return on invested capital, is in line with the figures seen in 2014.

2015 RAB: € 0.34 billion


Integrated water cycle

Integrated Water Cycle: sustained growth

In 2015, the integrated water cycle area recorded growth over 2014, both as a contribution to Group EBITDA and in absolute terms. 2015 is the second year in which the water tariff method defined by the AEEGSI (with resolution number 643/2014) for the two-year period 2014-2015.

Contribution to Group EBITDA: +1.3%


Water Cycle Area EBITDA rises by 7.1%

(mln/€)Dec 2015Dec 2014Abs. change. % change
Area EBITDA232.5217.1+15.4+7.1%
Group EBITDA884.4867.8+16.6+1.9%
Peso weight26.325.0%+1.3 p.p. 

Water Cycle customers: 1.4 million

The number of water customers settled at 1.4 million, increasing by 4.8 thousand (+0.3%) and confirming the trend towards organic growth seen across the Group's reference areas. 58% of the rise concerned areas in the Emilia Romagna region managed by Hera Spa, 36% referred to areas served by AcegasApsAmga and the remainder was seen in areas served by the Marche Multiservizi Group.


300.0 million m3 managed in the aqueduct

The main metrics for this sector are shown below:


Volumes dispensed through the aqueduct increased by 1.8% compared to 2014; this growth can largely be traced to an increase in consumption, both industrial and residential, and the lesser rainfall seen in 2015 compared o the previous year. Volumes dispensed, in line with AEEGSI resolution 643/2013, are an indicator of activities in the geographical areas in which the Group operates and are subject to equalisation pursuant to regulations that call for a regulated revenue to be recognised independently of the volumes distributed.

Non-billed water in line with the past

Non-billed water – which indicates the effectiveness and efficiency of the distribution system, reflecting leaks and administrative losses of the aqueduct – was in line with 2014.


Integrated Water Cycle: EBITDA increases

The table below summarizes the income statement for the water area:

Income statement (mln/€)Dec 2015Inc%Dec 2014Inc,%Abs, change% Change
Operating costs(415.5)-52.2%(422.7)-54.2%(7.2)(1.7%)
Personnel costs(151.2)-19.0%(142.7)-18.3%+8.5+6.0%
Capitalised costs3.00.4%2.40.3%+0.6+25.4%
EBITDA   232.529.2%217.127.8%+15.4+7.1%

Revenues for the Integrated Water Cycle at € 796.2 million

Revenues increased by € 16.0 million (2.1%), going from € 780.2 million in 2014 to € 796.2 million in 2015. The reasons for this include greater distribution revenues for € 16.7 million, as a consequence of the application of the new integrated water cycle tariffs provided for by the responsible Authority for 2015, and compensations recorded for previous years. The € 12.2 million increase due to the application of accounting principle IFRIC 12 was more than compensated by € 14.4 million in lesser revenues for subcontracted works.

Operating costs decreased by € 7.2 million (1.7%), mainly due to € 13.4 million in lesser subcontracted works, linked to the current state of a few important contracts, the most substantial of which is the Rimini Seawater Protection Plan. This decrease is partially compensated by the higher costs derived from the application of accounting principle IFRIC12 for € 8.7 million.

EBITDA rises to € 232.5 million

EBITDA rose by € 15.4 million (7.1%), going from € 217.1 million in 2014 to € 232.5 million in 2015, due to revenue and cost optimisations.


Investments in the Water Cycle Area: € 114.9 million

Net investments in the integrated water cycle area amounted to € 114.9 million, showing an increase of € 21.3 million over the previous year. Including capital grants, investments in this area came to € 127.2 million.Interventions in the water cycle mainly concern extensions, reclamations and network and plant upgrading, in addition to regulatory upgrading, which concerned above all purification and sewerage.Investments totalled € 59.1 million in the aqueduct, € 34.3 million in sewerage and € 33.8 million in purification.


Among the more significant works, note: in the aqueduct, water system interconnections and networks and plant upgrading, including a particularly complex and substantial upgrading of water networks in the historical centre of Bologna; in sewerage, adaptation of discharges according to legislative decree 152/2006 and progress made in works for the Rimini Seawater Protection Plan, including the creation of the first portion of the Ausa balancing tank, the first portion of the Dorsale sud, the Hospital area collection tank and the first portion of the first allotment of the Northern Area separate sewerage networks; in purification, plant upgrading in Ponte Rizzoli, Cesenatico and Cattolica, reinforcement of the water lines of the Bagnacavallo purifier, revamping the oxygen production plant of the Idar purifier in Bologna, in addition to beginning works on the Servola purifier in Trieste and the Cΰ Nordio purifier in Padua. Requests for new water and sewerage connections decreased compared to the previous year in the water service as well. Capital grants amounted to € 12.2 million, of which € 2.3 million due to the tariff component of the New Investments Fund (FoNI) and dropped by € 8.9 million compared to 2014. I contributi in conto capitale ammontano a € 12,2 milioni di euro, di cui € 2,3 milioni di euro dovuti alla componente della tariffa per il fondo nuovi investimenti (FoNI) e sono in diminuzione rispetto al 2014 per € 8,9 milioni di euro.

A sharp increase in net investments: + € 21.3 million

Details of operating investments in the integrated water cycle area are as follows:

Water Cycle Area (€/mln)Dec 2015Dec 2014Abs. change % Change 
Total Water Cycle Gross 127.2114.8+12.4+10.8%
Capital grants12.221.1-8.9-42.2%
     of which FoNI (New Investment Fund)2.310.5-8.2-78.1%
Total Water Cycle Net114.993.6+21.3+22.8%

RAB at € 1.47 billion

RAB (Regulatory Asset Base), which defines the value of assets recognised by the AEEGSI in calculating return on invested capital, showed a slight increase compared to 2014.


Waste management

In 2015 the waste management area accounted for 26.0% of Group EBITDA. The decrease with respect to 2014 is principally due to the unavailability of a few plants and a decrease in energy prices, including Cip6 and CEC.


Waste Management Area: reduction in

The table below shows the changes occurred in EBITDA:

(€/mln)Dec 2015Dec 2014Abs. change % Change 
Area EBITDA230.0241.8-11.8-4.9%
Group EBITDA884.4867.8+16.6+1.9%
Percentage weight26.0%27.9%-1.9 p.p. 

Urban waste: +0.2%

The table below provides an analysis of the volumes commercialized and treated by the Group in 2015:

Quantitative data (thousand tonnes)Dec 2015Dec 2014Abs. change % Change 
Urban waste2,040.72,036.9+3.8+0.2%
Market waste2,002.12,098.7-96.6-4.6%
Waste marketed4,042.84,135.6-92.8-2.2%
Plant by-products2,182.92,290.2-107.3-4.7%
Waste treated by type6,225.76,425.8-200.1-3.1%

Volumes of urban waste increased by 0.2%, while market waste showed a decrease of 4.6%, already recorded in the previous quarters of the year, as a consequence of the depletion of some storage spaces in landfills. Sub-products decreased thanks to weather conditions, i.e. lesser rainfall, that caused lower leachate from landfills and production sites.

+1.4% in sorted waste

Sorted urban waste showed further progress, going from 54.0% to 55.4%. This high percentage of recovery brings greater environmental benefits and higher flexibility in the performance of treatment plants. This result can mainly be attributed to the fully operational status of the new selection and recovery plant in Bologna and the efficiency enhancement projects implemented in recently acquired areas of the Triveneto region, in which a calibrated process integration project allowed sorted waste to rise by over 2.9% (from 44.8% to 47.7%).


Sharp decrease in use of landfills


Quantitative data (thousand tonnes)Dec 2015Dec 2014Abs. Change % Change 
Waste-to-energy plants1,390.31,393.9-3.6-0.3%
Selecting plant and other432.7445.6-12.9-2.9%
Composting and stabilisation plants455.3478.3-23.0-4.8%
Stabilisation and chemical-physical plants1,141.61,182.3-40.7-3.4%
Other plants1,887.21,788.4+98.8+5.5%
Waste treated by plant6,225.76,425.8-200.1-3.1%

The Hera Group operates in the entire waste cycle, with 86 urban and special waste treatment and disposal plants, most importantly including 10 WTE plants, 11 composters/digesters and 6 selecting plants. The waste area's asset management has furthermore responded to the need to deal with market volumes and new customers pertaining to the company HASI, without significantly modifying its choice to resort to disposal in landfills an ever lesser extent, thus remaining in line with the indications provided by European Authorities, as foreseen by the business plan. As of 1 July 2015, significant corporate and organisational modifications have been introduced within the waste management area. Among these, the acquisition of the entire share capital of Akron, controlled by Herambiente with 57.5%; before this acquisition, the company dealt with selecting materials in the area of sorted waste, with a chain of plants dedicated to this purpose. Later, a transfer towards Herambiente of the disposal activities carried out for the cities of Padua and Trieste was implemented, creating the company Hestambiente, in order to move towards greater integration and efficiency with a full control of WTE plants across the entire Group. Furthermore, mergers occurred with Romagna Compost and Herambiente Recuperi, as well as the acquisition of Biogas2015 and branches containing a few plants of Geo Nova and of the Waste Recycling Group. The latter three operations will be fully effective in 2016.

Waste management: decrease in EBITDA

The table below summarises the income statement for the waste management area:

Income statement (€/mln)Dec 2015% Inc.Dec 2014% Inc.Abs. change % Change 
Revenues894.3 910.4 -16.1-1.8%
Operating costs(502.8)-56.2%(499.3)-54.8%+3.5+0.7%
Personnel costs(166.0)-18.6%(171.8)-18.9%-5.8-3.4%
Capitalised costs4.50.5%2.40.3%+2.1+87.8%

Waste management revenues for € 894.3 million

Revenues fell by 1.8%, going from € 910.4 million in 2014 to € 894.3 million in 2015. This change can be traced to the lesser volumes of waste disposed of, lesser revenues for electricity production partially resulting from a decrease in the unit price of CIP6/CEC, in spite of an increase in unit price of green certificates and the average price of special waste.


Operating costs in the area grew by € 3.5 million (0.7%), as a consequence of the sale of certificates dating to previous years and still present in stock, whose value has been included in the statements as lesser cost.

Waste management EBITDA at € 230.0 million

The change in EBITDA confirms what has been mentioned above, showing a decrease of 4.9%, going from € 241.8 million in 2014 to € 230.0 million in 2015.

Net investments in the waste management area come to € 34.6 million

Net investments in the waste management area concern plant maintenance and reinforcement, amounting to € 34.6 million, with a decrease of € 13.2 million compared to 2014.

The composting/digester sub-sector recorded an increase over the previous year of € 1.0 million, mainly due to interventions concerning the composters in Rimini and Ozzano, partially attenuated by lesser investments in the Voltana and Cesena plants, on account of the works carried out in 2014.

Reduced investments in landfills (€ 7.3 million) are due to lesser maintenance interventions on the Ravenna and Sant'Agata plants, the beginning of post-management in the Pago and Zocca plants and a reduction in storage in the Feronia landfill. In the area served by Marche Multiservizi, reduced investments in the landfill sub-sector were caused by the implementation in 2014 of an enlargement of the Cΰ Asprete di Tavullia landfill (Apulia). The foremost interventions in 2015 concerned the Tre Monti landfill, with a new biogas motor, and the Ravenna plant, where works were begun on the 9th sector, in addition to planning for the 5th Pago and Baricella allotment.

In the WTE sub-sector investments remained for the most part in line with the previous year. This is the result of more extensive works on the Padova and Trieste plants, compensated by a reduction in non-recurring maintenance on plants in the remaining geographical areas served by the Group, to which more substantial interventions were dedicated in 2014, including plants in Rimini, Modena, Pozzilli and Ravenna.

In the Special Waste Plant sub-sector, higher investments compared to the previous year were due to an increase in maintenance on the Ravenna plants, in particular the sludge dehydration and TAPO (Organic Process Water Treatment) plant. These more substantial investments were partially compensated by the completion of the installation of the new filter press in 2014 on the I.T.F.I. (Industrial Sludge Treatment Plant) in Bologna.

In collection systems, note the completion of Hergo Ambiente, the innovative IT system that provides integrated management of all Hera Group Waste Management Services activities, managing a network of interconnected people and devices to govern project design, planning, operational programs, signal management, on-field activities, final cost calculation and report management. Once again regarding collection systems, the installation of underground waste containers in Bologna continued. The capital grants refer to the latter (€ 0.6 million).

In selection and transhipment plants, the € 4.2 million decrease is due to works concluded in 2014 on the selection plant in Bologna and a transhipment plant in Cervia.

Details of operating investments in the waste management area are as follows:

Waste Management (€/mln)Dec 2015Dec 2014Abs. change % Change 
RS Plants2.52.3+0.2+8.7%
Ecological areas and gathering equipment10.312.5-2.2-17.6%
Transhipment, selection and other plants3.98.1-4.2-51.9%
Total Waste Management Gross35.247.9-12.7-26.5%
Capital contributions0.60.1+0.5+500.0%
Total Waste Management Net34.647.8-13.2-27.6%

Other services

Other Services: slight decrease in EBITDA

The other services area brings together all minor services managed by the Group, including public lighting, telecommunications and cemetery services.

In 2015, results in the other services area showed a slight decrease, coming to 0.5%, compared to the previous year: EBITDA in fact went from € 21.5 million in 2014 to € 21.4 million in 2015.

Slight drop in contribution to total EBITDA

Other Services EBITDA drops by € 0.1

The changes occurred in EBITDA are as follows:

(€/mln)Dec 2015Dec 2014Abs. change % Change 
Area EBITDA21.421.5-0.1-0.5%
Group EBITDA884.4867.8+16.6+1.9%
Percentage weight2.4%2.5%-0.1 p.p. 

523.7 thousand lighting points

The area's main indicators refer to public lighting, and are as follows:

Quantative dataDec 2015Dec 2014Abs. change % Change 
Public lighting    
Lighting points (thousands)523.7508.2+15.5+3.0%
Municipalities served157.0153.0+4.0+2.6%

The quantitative data concerning public lighting indicates an increase of 15.5 thousand lighting points and 4 municipalities served. This growth is due to new contracts awarded through tenders, including most notably: the acquisition of roughly 8 thousand lighting points in the Municipality of Rho, roughly 2 thousand lifghting points in the Municipality of Corbetta and 1 thousand lighting points in the Municipality of Palazzago. In the Lazio region as well, growth was seen for roughly 4 thousand lighting points in the Municipalities of Ferentino, San Cesareo and Fumone. Both 2014 and 2015 take into account the 29 thousand lighting points in the Municipality of Rimini maintained by Hera Luce through an indirect commission given to it by the company that serves the Municipality in question.

Other Services: revenues increase

A summary of the income statement for the other services area is provided in the table below.

Income statement (€/mln)Dec 2015% Inc.Dec 2014% Inc.Abs. change % Change 
Revenues126.2 124.4 +1.8+1.4%
Operating costs(88.3)-70.0%(84.6)-68.0%+3.7+4.4%
Personnel costs(18.4)-14.6%(19.4)-15.6%-1.0-5.2%
Capitalised costs1.91.5%1.10.9%+0.8+72.0%

Revenues for Other Services at € 126.2 million

Revenues in this area grew by € 1.8 million thanks to both positive results in public tenders and greater revenues in telecommunications due to an increase in services offered.

EBITDA falls by € 0.1 million

EBITDA dropped by € 0.1 million due to lesser earnings in the North-East for € 1.7 million, a result of rationalisation operations concerning the public lighting business, in order to make the most of new market challenges and come into line with the trend seen with acquisitions in Emilia Romagna, which grew by € 0.5 million over the previous year. Also note the good performance of the telecommunications business and cemetery services, that showed a 6.9% increase over the previous year.

Net investments for € 15.3 million

Investments in the other services area totalled € 15.3 million, increasing by € 0.5 million compared to 2014. In telecommunications, investments for € 9.3 million were made in networks and in Tlc and Idc (Internet Data Center) services. In the public lighting service, investments for € 6.0 million regarded maintenance, energy efficiency enhancement and lamppost modernisation.

Details of operating investments in the other services area are as follows:

Other Services (€/mln)Dec 2015Dec 2014Abs. change % Change 
Public Lighting and Street Lights6.05.6+0.4+7.1%
Total Other Services Gross15.314.8+0.5+3.4%
Capital contributions0.00.0+0.0+0.0%
Total Other Services Net15.314.8+0.5+3.4%


Trading and procurement policy

2015 will be remembered not only for the sharp drop in the price of oil but also for an upturn in national energy consumption. One cannot however forget how significant the drop that preceded this upturn was: declines had been continually seen for 13 years in oil, 2014 witnessed the lowest level of the last 10 years in electricity, while gas consumption in 2015 was in any case inferior to the amount seen in 1999.

Gas consumption up: +9.1%

This being said, natural gas consumption in 2015, interrupting the falling trend seen over the last four years, recorded a significant recovery (+9.1%) and reached 66.95 billion m3. Domestic consumption, favoured by colder winter temperatures compared to the previous year, rose to 31.43 billion m3, with a 9.5% increase. Growth in the thermoelectric sector was even more pronounced: benefiting from both a sharp drop in hydroelectric production and the summer heat, it interrupted a long series of downturns and, with an increase of 16.6%, settled at the highest level of the last three years, 20.73 billion m3. The downward trend in consumption in the industrial sector instead continued, reaching the lowest levels seen in the last fifteen years, 12.77 billion m3 (-3.0%).

Portfolio optimization

This market context also had a positive impact on Group sales, and as a consequence trading activities in 2015 were aimed on the one hand at optimising the portfolio, with a view to balancing the short-term position, and on the other negotiate and manage new supply contracts for the 2015/16 thermal year.

To provide further details, short-term adjustments, supported by an efficient prediction of upcoming demand, were implemented through purchase or sale agreements at the Virtual Exchange Point (VEP), at Baumgarten,  on the Title Transfer Facility (TTF) and on Net Connect Germany (NCG). These transactions generally occurred at favourable prices and allowed the foreseen objectives in economic results to be met.

Starting in April, Hera Trading initiated gas procurement activities intended both to fill the storage capacity purchased at the auction, coming to roughly 0.33 billion m3, and to provide gas for the Hera Comm free market for the 2015/16 thermal year, coming to roughly 0.5 billion m3, sourcing it directly from the spot market.

Modulated gas negotiations for 1.5 billion m3

During the month of April, earlier than in the previous year, negotiations began for modulated gas intended for the protected market delivery points (so-called Remi) of the Group's sales companies. The total amount involved was approximately 1.5 billion m3, related to the 2015/16 thermal year, as per the conditions for supply resolved by the AEEGSI beginning in October 2013. This negotiation allowed particularly favourable terms to emerge as regards both prices and payment conditions.

After having fallen for three consecutive years, electricity consumption also returned to positive figures. According to the provisional data elaborated by the national grid transmission company (Terna), total energy demand in Italy in 2015 reached 315.2 billion kWh, with an increase of 1.5% over 2014. 

Upturn in electricity consumption, thermo production: +8.3%

This growth was driven above all by the country's southern and central regions. The rise in electricity demand was more contained in Sardinia and Lombardy, and demand remained stationary in the North-East.

The strong drop in hydroelectric production, due to lesser precipitation and increased consumption during the summer months owing to particularly hot weather, favoured an upturn in thermoelectric production (+8.3%). This allowed the sector's suffering to be mitigated, albeit only partially, in that it remains afflicted by a remarkable overcapacity and unquestionably requires urgent reconsideration as to its rules and market framework in order to allow the flexibility of gas thermoelectric plants to be adequately recompensed.

This situation obviously affected the economic results reached by the thermoelectric plants controlled by the Group. Moreover, taking into account the limited installed thermoelectric capacity compared with the final market position, its impact was strongly curbed by commercial activity towards end customers.

Drop in DSM in plants in Campania

During 2015, as a consequence of Terna's removal of grid congestion in central and southern regions, a significant drop in the earnings made by the Teverola and Sparanise plants on the Dispatching service market (DSM) was seen. During the second six months of the year, interventions were initiated on these two plants with the aim of increasing their level of flexibility as preparation for the introduction of the capacity market.

The performance of the Ortona plant was once again modest, to due its location in an area marked by scarce demand on the DSM, as was that of the Cogen plant in Imola, despite the fact that the latter, as of 2015, following technical modifications implemented in 2014, was operated on the DSM as well.

Lesser earnings in electricity trading and import

In 2015, despite an increase in electricity and environmental certificate trading on European markets (+3,2%), the results reached did not meet expectations, due to a general drop in earnings and a lower average valorisation of import capacity detained compared to 2014.
The management/streamlining of Hera Comm's purchasing portfolio, by way of transactions on the Stock exchange and on over the counter (Otc) platforms, proved to be particularly effective.

Management of commodity risk and exchange also proved to be particularly adequate, within a context marked by the plunge in oil prices and significant changes in the euro-dollar exchange rate.

Adaptation to Remit requirements

During 2015, Hera Trading saw to bringing itself into line, in terms of tools and procedures, with the obligations foreseen by the Regulation on Energy Market Integrity and Transparency (Remit), as early as its first deadline, 7 October 2015. This date marked the beginning of the data collection implemented by the Agency for the cooperation of energy regulators (Acer).


Financial policy and rating

An economic system struggling to get off the ground

Over the course of 2015  the euro zone continued, as stated above, along a path of relatively resilient economic and financial growth, which thanks to internal demand, in particular household consumption and intra-area exports, did not overly feel the effects of the slowdown in world commerce. The weaker condition of China and other emerging countries, and the ensuing turbulence on world financial markets, in fact caused uncertainties as to prospects for global growth, but the their effect on the euro zone, much like in the U.S., have until present been contained, even though some signs have appeared of a deterioration in extra-area exports. In any case, the expected slowdown in global economic growth and its effects on markets have made the future prospects of advanced economies more uncertain. The upturn in the euro area must still be considered overly fragile and subject to risk due to the slowdown in foreign demand, largely linked to emerging countries, whose activities have all decelerated if not shrunk, and whose currencies have seen a sharp depreciation.

Expansionary monetary policy maintained  by the ECB

Given the present European context, and the difficulty in finding new opportunities for development, the ECB did not change its expansionary monetary policy: further cuts in interest rates on deposits were introduced in December, going from -0.20% to -0.30%, and the € 60 billion monthly asset purchase program was kept in place, or rather extended, from September 2016 to March 2017. The monetary policy committee is evaluating the changing economic and financial context of the euro zone, according to expectations that continue to be tied to the objective of 2% inflation. The ECB is facing, moreover, an unfavourable scenario as regards the goal of price stability, in that higher disinflationary effects have derived from the price of oil, a factor that cannot be controlled with monetary policy interventions.

Record low in interest rates

The drop in interest rates seen in 2015, which thanks to quantitative easing reached a record low, falling on average by one percent over the last twelve months, has led many companies to take advantage of this favourable moment and issue new instruments of debt on the capital market. 

Limited credit offer

While the European Central Bank's interventions have contributed to lowering interest rates, expectations for improved credit conditions do not seem to have been fully met, in that the bank system's policies in offering credit remain influenced by numerous regulatory restrictions.

Financial markets: high risk aversion

Over the course of the year, financial markets saw a phase of high risk aversion that particularly penalised both stock markets and raw materials markets. As regards stocks, the main indicators of both developed markets and emerging countries recorded the greatest losses seen since summer 2011, in the midst of the euro zone crisis. The event that most strongly influenced trends in financial markets was the Chinese Central Bank's unexpected decision, taken in mid-August, to modify the mechanism that defines the value of its own currency, the yuan. The increase in risk aversion mentioned above brought activities involving lesser risk to be preferred; treasury bond rates therefore fell, while the spread between peripheral European Union bonds and the bund remained substantially stable, thanks to purchases made by the ECB and the agreement reached during the summer between Greece and the international institutions.

Market curve and 10-year BTP-Bund spread

Once the danger of Greece leaving the euro area had been avoided, a general decrease occurred in treasury share rates, with a reversal of the bullish trend seen between April and June. In a context defined by a fall in government bond rates, 10-year swap rates also inverted the bullish trend.

The shape of the swap curve (a benchmark for the bond market), after the downward trend seen in the early months of the year, recorded an increase in the differential between 2-year and 10-year swap rates coming to about 100 basis points, moving towards a balanced medium-term rate that is expected to reach 80 basis points

Swap rates

The spread between 10-year BTP and Bund yields (as a useful parameter in defining the cost of provisions) fell from over 160 basis points in July to 96 basis points at the end of the year, thus approaching the minimum level of 87 basis points recorded in March of the same year. However, the spread rose rapidly in early 2016, reaching a maximum of 145 basis points, affected by turbulence on financial markets, which began the year in a state of concern, encumbered by the risk of a slowdown in global growth. In particular, in the euro zone, given the absence of a single European bond and complete risk sharing, the repercussions of this phenomenon included a wider spread in peripheral countries (Greece, Italy, Ireland, Portugal and Spain) towards the German Bund, which still remains the safest bond. 

Management model: active and prudent towards risk

Given this economic and financial scenario, the Group has devised a financial management plan capable of maximising its yield profile while maintaining a cautious risk strategy. The average cost of debt has been optimised through liability and financial risk management activities aimed at seizing favourable market opportunities. In particular, on 28 May 2015, offset swaps were stipulated on 2019 bonds for € 500 million (fixed rate 2.09%) and 2021 bonds for € 500 million (fixed rate 1.81%) that brought the amount of fixed-rate debt to over 80%, with the aim of setting future cash flows at the minimum rates seen in April-May.

Committed Lines

To support liquidity risk indicators and optimise costs/convenience of funding, the Group has obtained committed credit lines for € 395 million with an average age of 4 years.

Financial risk management strategy

A list is provided hereunder of the policies and principles for financial risk management and control, including liquidity risk with the related default risk and debt covenants, interest rate risk, exchange rate risk and rating risk.

Proactive liquidity management

Liquidity risk

The Group attempts to match the maturities of its assets and liabilities, linking its investments to sources of funds that are consistent in terms of maturity and manner of repayment, taking into account the refinancing requirements of its current debt structure.

Liquidity risk refers to a company's failure to meet its financial obligations, due to an inability to obtain new funds or sell assets in the market.

The Group's objective is to ensure such a level of liquidity as to make it possible to meet its contractual obligations both under normal conditions and under critical conditions by maintaining the availability of lines of credit, liquidity and a timely start of negotiations on maturing loans, optimizing the cost of funding on the basis of current and future market conditions.

Adequate liquidity for a worst case scenario

The table below shows the 'worst case scenario', where no consideration is given to assets (cash, trade receivables etc.) and emphasis is placed on financial liabilities, both principal and interest, trade payables and interest rate derivatives. All demand loans are called in while other loans mature on the date when repayment can be demanded.

Worst case scenario31.12.201531.12.2014
(€/mln)from 1 to 3 monthsfrom 3 months to 1 yearfrom 1 to 2 yearsfrom 1 to 3 monthsfrom 3 months to 1 yearfrom 1 to 2 years
Debts and other financial liabilities134977536612895
Trade payables1,121001,19400

To guarantee sufficient liquidity to meet every financial obligation for at least the next two years (the time limit of the worst case scenario shown above), at 31 December 2015 the Group had € 541.6 million in liquidity, € 474 million in unused lines of credit of which € 395 million in committed lines of credit and a substantial amount that can be drawn down under uncommitted lines of credit (€ 1,000 million).

The lines of credit and the related financial activity are not concentrated on a specific lender, but distributed among major Italian and foreign banks, with a use much lower than the total available.

Average maturity of debt: over 8 years

In December the Group used a line of financing amounting to € 100 million, disbursed by the European Investment Bank (EIB), intended to finance investments aimed at upgrading and expanding gas and electricity distribution networks and public lighting plants. For the Group, this operation provided a significant way of consolidating its financial structure, which is marked by a mainly long-term debt structure, accounting for 90% of total borrowings, of which about 78% reflects bonds repayable at maturity. The average term to maturity is over 8 years, of which 68% maturing beyond five years.

The table below shows the cash outflows broken down by maturity within and beyond five years.

Debt repayment outlays (€/mln)31 Dec 1631 Dec 1731 Dec 1831.12.201931.12.2020Over 5 yearsTotal
Bank debt/due to others21970515147352791

Default risk and debt covenants

This risk is related to the possibility that loan agreements entered into contain clauses whereby the lender may demand accelerated repayment of the loan if and when certain events occur, thus giving rise to a potential liquidity risk.

No financial covenants

At 31 December 2015, a significant portion of the Group's net borrowings was covered by loan agreements containing a number of clauses, in line with international practices, that place some restrictions. The main clauses guarantee equal treatment of all debt holders with respect to the company's other non-guaranteed debts (pari passu) and prevent it from granting to subsequent lenders, with the same seniority status, better security and/or liens on its assets (negative pledge).

As to acceleration clauses, there are no financial covenants on debt except a corporate rating limit, specifying that no amount in excess of €150 million in debt can be rated below investment grade (BBB-) by even one rating agency.

Change of control & Investment grade 

On the remaining part of the debt, the acceleration clause is triggered only in case of a significant change of control for the Group that entails a downgrading below investment grade or the termination of the publication of the rating.

Interest rate risk

The Group uses external funding sources in the form of medium- to long-term financial debt, various types of short-term credit facilities and invests its available cash primarily in immediately realizable highly liquid money market instruments. Changes in market interest rates affect both the financial costs associated with different types of financing and the revenue from different types of liquidity investment, thus impacting the Group's cash flows and net financial charges.

Prudent management of interest rate risk 

The Group's financial policy has been designed to identify an optimal mix of fixed- and floating-rate funding, in line with a prudential approach to interest rate risk management. The latter aims to stabilize cash flows, so as to maintain the margins and certainty of cash flows from operating activities.
Interest rate risk management entails, from time to time, and depending on market conditions, transactions involving a specific combination of fixed-rate and floating-rate financial instruments as well as derivative products.

Offset swaps optimise the average cost of debt

The Group's exposure to interest rate risk, including the effect of derivatives, comes to 17% of total borrowings. The remaining 83% of debt is at fixed rates, resulting from a stipulation of offset swaps dating to 28 May, with which two € 500 million bonds maturing in 2019 and 2021, that in March were at floating rates as an effect of hedging derivatives, were brought to fixed rates.

This operation allowed the rates to be set at 2.09% and 1.81% respectively, decidedly lower than the original rates of 4.5% and 3.25%.

The Group applies a financial management approach based on risk mitigation, adopting a risk hedging policy that leaves no room for the use of derivatives for speculative purposes. In fact, derivatives are a perfect hedge of the underlying debt instruments.

83% of borrowings at fixed rates 

Worst case scenario31.12.201531.12.2014
(€/mln)from 1 to 3 monthsfrom 3 months to 1 yearfrom 1 to 2 yearsfrom 1 to 3 monthsfrom 3 months to 1 yearfrom 1 to 2 years
Debts and other financial liabilities134977536612895
Trade payables1,121001,19400

Exchange risk unrelated to commodity risk

The Group adopts a prudential approach towards exposure to currency risk, in which all currency positions are netted or hedged using derivative instruments (cross-currency swaps). Currently the Group has a bond outstanding for 20 billion Japanese yen, fully hedged by a cross currency swap.

Ratings confirm the strong points built up by the Group over time

Hera has been given a long-term "Baa1" rating with a stable outlook by Moody's and a "BBB" rating with a stable outlook by Standard & Poor's.

On 3 June 2015 Moody's issued a credit opinion confirming the "Baa1" rating and improving the outlook to "stable". This positive appraisal of the Group's risk profile is due to its solid and balanced business portfolio, in addition to its good operating performance and consolidated strategy.

The rating previously issued by Standard & Poor's was confirmed, owing to S&P's expectancy that the Group can meet targets in credit worthiness and that its solvency is not completely dependent on the conditions of sovereign risk.

Given the current macroeconomic context and the prolonged uncertainty of Italy's economic prospects, the Group's actions and strategies are always calibrated so as to maintain and/or upgrade its rating.

Sustainability policies

The year 2015 was very positive for the Group in terms of social and environmental sustainability, as attested by the results and by the interconnecting programs and projects underway.
Sustainability has had a key role in Hera's strategy since its establishment and the Group's approach provides for the integration of sustainability in planning and control systems. This has been implemented through:

  • a balanced scorecard system linked to incentives and involving the entire management (sustainability goals account - on average - for 20% of the variable manager remuneration in 2015);

  • a progressive improvement of the Group's accountability profile, as attested by the sustainability report (covering the maximum application level of the GRI-G4 guidelines) as well as by the thematic vertical reports available to the stakeholders (these were furtherly extended and improved in 2015).

Our strong focus on value systems continued in 2015 with the extension of the seminars for managers, executives and new recruits, aimed to raise awareness of the Code of Ethics and of corporate social responsibility, as well as with the launch of the AlfabEtico training program in AcegasApsAmga (ending in 2016), which will gradually involve all of the employees.

The sustainability goals achieved and the main events carried out in 2015 have covered the following areas:

Safety at work, internal climate and professional development

Following the awareness programs and the OHSAS 18001 certification, covering" 89% of the Group's employees, the 2015 accident frequency rate dropped, equalling 20.7 (vs 22,6 in 2014). This reduction was recorded in all of the Group's main companies as well as in the labour force population, for which the frequency rate decreased by 11% compared to 2014. The sixth company climate survey (surveys have been conducted every two years since 2005) showed an employee satisfaction rate equalling 63/100 (in line with the target) with a 2-point growth compared to the previous survey. Based on the result, steps for further improvement were defined. Some of the "work-life balance" initiatives are noteworthy: 30 Hera employees' children in the Hera pre-schools and 152 in the summer centres made available in 2015. Finally, the training saw a further increase in 2015, with 31.4 average training hours per capita (vs 28 hours in 2014).

Waste management: state-of-the-art in Italy, consistent with EU circular economy courses

The year 2015 saw a further drop in landfill use for urban waste disposal: 8.1% against 13.3% in the previous year (Italian 2014 average: 34%). Separate collection increased from 54% to 55,6% (Italian 2014 average: 45.2%). Such results are consistent with the European Commission's pathway covering the December 2015 circular economy package, which sets forth a number of detailed recycling and landfill disposal targets as of 2030; some of these have already been met in the Hera territory. The environmental performance results of the Group's 10 waste-to-energy plants are encouraging; atmosphere emissions were very limited in 2015 and, on average, 84% lower than the tolerance. Finally, in November last year Hera issued the 6° edition of the 'Tracing waste' report - this is certified by an independent body, DNV-GL, and was extended in 2015 to Marche Multiservizi – providing citizens with factual evidence that separate collection is still on the rise and that it equals 94.3%.

Service quality and customer support

Hera Comm's customer contact quality standards were raised again in 2015: the average waiting time at the call center decreased, equalling 30 seconds for residential and 26 seconds for business customers. Front desk results have also improved: the average waiting time was 8.9 minutes in 2015. In the Triveneto, contact channel performances suffered the transfer of the IT invoicing systems towards the Group's systems, but a strong improvement is expected in 2016. 

The constantly rising web-run accounts also affected customer support sustainability: customers registering for online Services rose to 15.9% in 2015, whereas applications for the electronic bill rose to 13.8% (+12% and +58% respectively). 

The 2015 survey on the Group's service quality (about 5,300 interviews) recorded a high customer satisfaction rate (70/100; increasing numbers compared to the previous year). Survey data will be used to define further progress, in addition to the measures being planned within the "Customer experience" project, launched in 2015 and aiming to improve the customers' experience with Hera.

Energy efficiency among the priorities

In 2015 Acegas ApsAmga and Marche Multiservizi obtained the ISO 50001 certification for energy management system in 2015; this is now our 6th ISO 50001-certified company. The implemented ISO 50001 measures (incorporated into the energy improvement plan) have already enabled us to reduce energy consumption by about 1,500 tep. The improvement plan defined in 2015 provides further energy efficiency steps (totalling 2,900 tep) to be implemented by 2016, allowing a 2.3% total saving compared to energy consumption in 2013. To support the Group's commitment in this area, "Value for Energy" - the first report entirely focused on energy efficiency - was published and presented to the public at Ecomondo. In addition, many energy efficiency measures are carried out with customer / partner companies, to which the Group offers its know-how (also through Hera Energy Services, founded in early 2015).

Strong commitment to sewage treatment sustainability

In 2015, the main measures were aimed to redesign the Rimini sewage and purification system (2 out of 11 interventions under the Optimized Bathing Safeguard Plan. These included the doubling of the S. Giustina purifier), the refurbishment of the Servola purifier in Trieste (remediation was accomplished and a supplier for the system executive design and adaptation was identified), as well as upgrading the purifying efficiency (and/or reducing energy consumption) for the Bologna (IDAR), Padua (Cΰ Nordio), Cesenatico (Fc) and Cattolica (Rn) purifiers, which will be completed by 2017.

Even in 2015, upon selecting its suppliers the Group prioritized the most profitable bid method used in public procurement procedures, so accounting for 2/3 of the total value of the allotments. The average score for social and environmental aspects amounted to 24/100. Disadvantaged people employment resulted in a further growth in the value of supplies from social cooperatives, which reached 46.5 million euro last year (+ 4% compared to 2014). Supplies from local providers grew by 68%, while the estimated employment spin-off equals about 5,650 people, which confirms the Group's primary role in territorial development. Supplier monitoring under SA8000 regulation continued in 2015, as did the accident research monitoring for the leading suppliers (those involved in such monitoring account for 79% of the value of goods and services).

Focus on territory and communities

Environmental education in schools was still carried out in 2015; in all of the areas, 'The Great World Machine' and 'The Science Well' events were consolidated, with over 78,000 participants. Our focus on the territory resulted in a revival of the 'Gift your city a tree' campaign in 2015, with a new target of 50,000 electronic bill subscribers, associated to an additional 1,000 trees for 74 municipalities partnering with us in the initiative. Thanks to the first campaign, launched in 2012, 1,747 trees (out of 2,000 trees in the plan) have already been planted in 42 municipalities. Other evidence of our innovative focus on community and on local sustainable development are:

  • the spread of the 'Il Rifiutologo' (The Wastologist) app, installed by over 79,000 people, which informs users about correct separate collection while enabling them to report malpractice through their smartphone (activated in all of the 136 municipalities served by Hera Spa, as well as in Padua and Trieste);

  • the extension of several waste reduction programs (eg 'Change the final', 'FarmacoAmico', 'CiboAmico'), resulted in encouraging social outcomes (preventing about 5,300 tons of waste, i.e. the yearly production of about 8,700 people, from being produced in 2015);

  • the extension of the pilot scheme for the multi-stakeholder local committee 'HeraLAB' to the Modena area, to interface with the local communities' needs and to develop better sustainability in the Hera-managed services. As many as 68 representatives from different stakeholder categories, appointed by the Board of Directors, are involved in the 6 active local HeraLABs. There are 17 schemes proposed by LAB in 2015, 8 of which have already been completed.

A synthetic reference to specific areas and activities is in the following paragraphs; for further analysis, see Sustainability Report.


Technological innovation

During the year, the development and innovation activities continued to explore the areas identified at the end of 2014, consistently with the priorities of the group's business chains. More specifically, the programs planned for each key area were launched, such as circular economy, recovery of materials, energy efficiency and smart city services.

Circular economy and waste recovery

The launching plan for the new facility that will produce biomethane from organic waste continued in 2015. The technical choices, the designing and the public tenders for the main plant components were completed. The process for obtaining the relevant authorizations has also been started up.
A number of experiments have been launched for the enhancement of waste or by-products (sludge from sewage treatment, cuttings, pruning, etc), in order to assess the viability of fuels or bio fuel production.
As to urban waste collection, we defined a concept underlying a new, more user-friendly waste collection system, capable of increasing the quantity and quality of separate collection. The key concept features involve aesthetics, integration into the urban context, identification of users' data to achieve accurate billing, as well as user data transmission to the collector.

Smart City

After the construction of the first smart public lighting pole prototype, which integrates different technologies (smart cameras, hot-spot wi-fi, RFID readers, smart parking sensors, environmental sensors etc.), an evolution is underway to activate the same services on the existing poles with no infrastructure replacement.
As part of the smart city services, new initiatives were identified and their viability is scheduled to be completed in 2016. Key areas involve supplying new innovative services (e.g. common environmental monitoring, video surveillance with image analysis) as well as coordinating the different profiles that deliver public services in the city (e.g. integrated and optimized management of excavation requests).

Energy efficiency

Our engagement in energy recovery and in the optimization of energy consumption is ongoing.
The major pressure drops in water networks were assessed in view of the installation of microturbines for recovering energy, and preliminary checks were carried out in view of the installation of a Francis turbine in the Bologna water supply network.
New technologies for sewage sludge treatment and for process optimization in purification plants were also evaluated; these advancements help maximize biogas production for energy recovery and lead to controlling the organic sector in order to optimize energy consumption. The feasibility stage and the first implementation of these opportunities are scheduled in 2016.
The analysis of domestic consumption optimization devices (smart thermostats) is still ongoing. After fitting the most innovative thermostats on the market at the Forlμ laboratory, three devices were identified as being the most interesting for testing with real users. About a hundred of our employees have tested the thermostats in their homes, to help identify the best device for marketing among the Group's customers.
The energy-mapping project saw the creation of a model that integrates consumption data from the main services in order to extract value-added information, which will help spot particularly critical consumers (from an energy efficiency viewpoint) and to create a number of benchmarks for consistent user clusters.

Funding tenders

The potentially interesting funding tenders were still monitored during the year, and attention was paid to both European (Horizon 2020 and Life) and national / regional calls (POR / ERDF). In some cases, projects in partnership with national and international subjects were presented.

Quality, safety and environment

The Integrated Management System including Quality, Safety, Environment, Security and Privacy was further consolidated in 2015; its maturity and flexibility enabled it to adapt to organizational changes as well as to scope extensions in all of the relevant activities.

The civil site emergency management was also centralised in favour of the entire Group.

The environmental offence prevention system, set forth in Legislative Decree 231, was expanded under the regulatory changes enforced, resulting in a revision of the thematic information flows.

The accident rates are unchanged in frequency and in severity.


Industrial relations, development and staff training

Industrial relations

The new Hera Group's Industrial Relations Protocol with the National Category Unions was signed on 28th July 2015. This protocol applies to the whole Group's workforce and covers all of the Hera Spa territories, areas and subsidiaries nationwide. The new protocol, which is required in light of the new corporate and regional status of the Group, provides for a new three-tier system of industrial relations: Group, business/chain units or single controlled company, and territorial structural unit. The protocol will continue to include prior/final information, joint review/comparison and bargaining stages. An Industrial Relations Committee will be established for Hera Group, to promote an information and joint-analysis model of the reference scenarios; the formerly launched technical Observatory for organizational innovation and work quality (LaborHERA) will also be reappointed. Meeting minutes covering Hera Group's organizational and corporate development - resulting from the unbundling requirements - were also signed with the National Secretariats and the Group's Union Coordination Board. Through dedicated meetings, the parties also activated a preparatory course focused on the new corporate scenario, covering any ensuing aftermaths.
In the Friuli Venezia Giulia and Veneto areas, union agreements were signed to achieve more uniform working hours and Performance Bonus remuneration. Through such arrangements, bonus economics as well as working hours are now entirely consistent in comparison to the Emilia-Romagna area. In the Veneto, canteen treatments were also uniformed. In the Marche area, as part of the Performance Bonus renewal, the parties went on to define new targets, aimed at improving results in terms of quality, productivity and profitability. In addition, an extra bonus for security parameter advancement was defined. New minimum services to be delivered in case of strike were also defined through agreement minutes between Hera and the environmental unions of the Bologna area. The lawful joint examination procedure on the transfer from Geo Nova to Herambiente of the landfill and stocking management business unit was also completed.


Our commitment to training and to spreading the Group's leadership model continued: a series of initiatives aimed at managers and executives have been implemented since 2010. The "focus on service" training sessions - mainly designed for the Group's executives, managers and directors - took place in the first term of 2015 and the AcegasApsAmga and Marche Multiservizi employees were fully integrated in the scheme. The sixth climate survey, started up in the 2nd half of the year, saw a growing participation by our workforce; while the outcomes will be published in early 2016, we will simultaneously define a number of centrally directed and budget-unit directed upgrading steps.
The Good Return Policies project, funded as of 19th March 2013, ended on 18th March 2015. After its approval by all of the unions, the final accounting for the project was sent to the Ministry; the ensuing value consistency and reported activity assessment by the Ministry yielded excellent results. A new Development Process for the entire Group was also underway in 2015; all the profiles involved in evaluation and calibration were trained and about 5,000 people underwent performance and managerial skill assessment.


In the first half of 2015, as many as 141,190 hours of training were delivered at Group level: 16.9 hours per capita (14.6 in 2014), with an increase of about 16%. Still at Group level, about 92% of the employees were involved in at least one training activity. The related economic investment, net of trainee and in-house trainer costs, amounted to € 766,702, of which € 95,018 from training funds.
A total of 262,125 training hours were delivered in 2015: 31.4 hours per capita (28.2 in 2014), increasing by roughly 11%. At Group level, about 99% of the employees were involved in at least one training activity. The economic investment, net of trainee and in-house trainers cost, equalled € 1,730,725, of which € 578,986 from training funds. The above figures confirm the Group's substantial economic and resource effort to promote its human capital's growth and advancement; this was also achieved through the consolidation of HerAcademy, the Group's corporate university. As to the HerAcademy programs, particularly noteworthy is the workshop held on 14th December, called Waste Cycle Sustainability and New Lifestyles in a Changing Society, as well as the development of a school-work scheme management model, based on a work-and-school skills integration approach. This was started up following the memorandum of understanding with the Emilia-Romagna Regional Education Office, signed on 25th September 2015, which provides for 180 training schemes alternating school and work, and for summer internships over the next three years.

Diversity and Welfare

On 18th March 2015, the Good Return Policies funding scheme ended; from 2013, the scheme allowed to train 75 people returning from parental or family care leave, and to involve 50 people in group coaching. Through this project, agreements have been signed since 2013 with nurseries close to the Hera offices in Modena, Ferrara, Forlμ and Rimini. These agreements have made it possible to deliver an affordable, flexible service to colleagues even in areas that still had not been able to benefit from a company or intercompany nursery.
The positive summer camp experience continued in 2015 for the employees' children: 152 children benefited from the service under particularly favourable conditions during the summer weeks, with a 50% contribution to the registration fee for the first week, along with Cral and through agreements with local partners in Emilia-Romagna. Moreover, in line with the balancing approach, the scheme was extended to colleagues from AcegasApsAmga and Marche Multiservizi.
The DeMailing project, aiming to reduce the number of emails exchanged in the company through awareness-raising, information and technological upgrade, was activated in 2015 with several positive outcomes, such as work time streamlining.


Commercial policy and customer care

Growth in the group's customer base

The Group's customer base saw a further growth in 2015, with varying performance in the individual services. The number of gas customers rose by 0.9%, thanks to the Alento Gas entry (+12thousand customers approximately).
The Electricity client base grew by 7.7% as a result of the marketing action developed in the Group's historical territory, where growth was consistent between the residential and the non-residential segments.
The water service customers grew by 0.3%, in line with the same change detected in the previous financial year.

Cotracts31-Dec-1531-dec-14Delta pdf n.delta pdf %
 Gas  1,327.6  1,316.2  11.4  0.9% 
 Electricity  856.8  795.2  61.6  7.7% 
 Water  1,449.4  1,444.6  4.9  0.3% 
 Districtheating  11.8  11.5  0.3  2.4% 

Data are expressed in thousands

A growing number of customers contact Hera Comm through the web channel

The paperwork volumes handled by Hera Comm's contact channels (customer front desks, call centers, mail and on-line services) saw a slight decline in 2015 (1.5%), almost entirely due to the improvement of consumption estimates and to transparency in the contracting and billing stages. The call center is still the most widely used contact channel (53.5%), followed by customer assistance front desks (28.4%) and by the web channel (12.6%), where the filed procedures grew by 4.6% compared to 2014. The web channel increase ensues from the upgrading measures implemented in the online services, which were shared through accurate communication policies, so as to enable our final customers to manage their needs in an easier, faster and more efficient way.

Call centres as customers' favourite channel

Investments in technology to improve call centre efficiency and innovation continues in 2015. The development and full implementation of the telephone platform, activated in 2014, has led to significantly improved quantitative and performance indicators. Proactivity towards the customer is also ongoing, aimed at increasing the direct debiting and electronic delivery of bills. Special attention is paid to staff training and problem solving in order to perfect the one-call solution and to increase customer satisfaction.
At the end of 2015, the Group's network had 123 front desks. During the year, the points present in the different areas were further standardised and developed and their management process was consolidated; the inauguration of the Udine front office, whose layout is in line with Hera Comm's front desks, is among the results.
Below are the main front office and call centre indicators (Hera Comm).

Average waiting time - contact center (sec.)20132014 2015
residential customers494030
business  customers313126
Average waiting time - customer (min., sec.)201320142015


Information systems

Corporate evolution

The Information System management supported the Group's corporate evolution with the launch and completion of the projects ensuing from the Romagna Compost and Hare merger into Herambiente and from the extension of this solution to former Akronplants.

Standardisation of systems in other companies

The plan aimed to harmonize the other companies' systems within the Group's enterprise platforms is ongoing. The AcegasApsAmg three-year migration plan continues and HeraComm Marche, Alento Gas, Synergy, Tri-generation, Insignia have also underwent migration.

Regulatory adjustment

The first planning stage of the unbundling program, of the 2.0 bill and of the electronic invoicing targeted to the public administration was completed. The specifications set forth by a number of resolutions - such as electric turning, the new electric grid code, commercial quality, remote reading and residential gas meter management (basic functionality) – were also implemented.

Support to business

Several projects were completed in this sector, such as the asset and financial planning system, the marketing campaign management and the analytical laboratory management. In the mobile sector, newly designed applications were integrated with the Group's systems, to assist in meter enrollment management and in surveying.

Reduction of technology risk

Among the various activities scheduled for technology risk reduction this year, it is worth mentioning the launch of a gradual adoption of highly performative and scalable engineered systems, to support the Group's IT solutions.

DSI process efficiency

The fine-tuning of the new managerial organization was completed, along with the adjustment of the impacted processes.

Information system safety

The IT and enterprise data safety systems, in compliance with data protection regulations, are among the key objectives of the Information Systems Division. Our commitment to preventing and monitoring potential cyber attacks is ongoing, through a periodic risk analysis on the production systems(vulnerability assessment), through updates of the existing systems and through new specialized solutions. This setting is the ground for the 2015 plans to update the anti-virus and identity managemenent systems, as well as to implement the database access monitoring system.
During the year, audits were conducted for the renewal of ISO 9001, ISO 14001 and OHSAS 18001.


Personnel and organisation

Human resources

Hera Group's employees with open-ended contracts as of 31st December 2015 equal 8,426 (consolidated scope) and are distributed by role as: executive managers (146), middle managers (526), office clerks (4,449), and workers (3,305). This setup ensues from 257 entries and 350 exits and from changes in company structure*, which introduced a hundred new units. Hiring mainly results from a quality turnover entailing the entry of skilled workforce.

Exits: (TOTF -12 TI)

Industrial and operational integration: the Hera model


The Hera model stands out in the multi-utility industry for implementing its industrial and operational integration under one leading holding company, which ensures a group-wide view through a central management unit in charge of setting and control. Activity management is enacted through dedicated business lines, where coordination and guidance of the operational areas are entrusted to the Operations General Department. The utility sector changes constantly and rapidly due to competitive dynamics, to a specialty-oriented regulatory setting, and to other key elements such as water and environmental services legislation, service allocation tenders and regional regulations. Accordingly, growth in such a setting rests on the ability of enterprises to innovate the industrial processes on a regular basis.

Innovation and streamlining of operating processes

Besides consolidating its structural model, in 2015 the Group continued to streamline its operating processes and was further committed to technological and process innovation, with the aim of securing the tools needed to pursue the Group's aims. Below is the Group's organizational macrostructure:


The General Operations Department saw the remodelling of the Engineering Department structure, aimed to overcome the distinction between Large Plant and Network System Engineering, with planning, design and work construction skills made to converge into a single organizational ambit.
In line with regulatory developments on functional unbundling, logistic changes to spin off the distribution of gas and electricity have been enacted and are scheduled to be implemented in July 2016.
As far as the Energy Network Department is concerned, the overall management structure was rearranged with a view to streamlining the model. The District Heating Department and the Relevant Production Units function (CHP Imola) were relocated within the Market Central Department, as they were not directly affected by unbundling legislation and were consistent with district heating guidelines.
As part of the streamlining, it is worth mentioning the reallocation of the Technical Services Department - previously under Central Innovation - into the Technical Customer Department, to back the management role in the delivery of technical customer services group-wide.

Through its structure, processes, resources and systems, the Group aims to balance its business prospects and territorial roots while pursuing maximum effectiveness and efficiency in service delivery.

Uniforming AcegasApsAmga's organisational model

AcegasApsAmga's structural harmonization plan was still ongoing in 2015. To this purpose, procurement, fleet management and facility management were conveyed into Purchases, Contracts and Services.
A company-wide project aiming to improve performance and service in AcegaApsAmga contact structures was launched, promoting an integrated view of the diverse customer management issues.

Main developments in Herambiente

The activities that led to the merger through incorporation of Akron into Herambiente, operational from 1st July 2015, are complete as at 30th June 2015; they aim to bolster our leading role in the waste-to-energy market, completing the value chain downstream of the standard treatment process.

By virtue of the merger, seven plant areas located in Emilia Romagna and comprising storage, sorting, treatment and recovery facilities, were conveyed into Herambiente.

As to the Production Department, following AcegasApsAmga's sale of the Padua and Trieste WTE plants, Hestambiente was established with operational effect from 1st July 2015, aimed to strategic business development and to underpinning our leading role in the waste disposal sector.

The Geo Nova business branch, including two landfills and a storage facility located in the provinces of Verona and Pordenone. was acquired by Herambiente in the fourth quarter of 2015, with operational effect as of 29th December 2015.

This operation is designed to boost Herambiente's role as a partner for the disposal and brokerage services targeted to North-Eastern companies in Italy, by detecting business opportunities in the special waste market for all of the segments within Herambiente's scope (e.g. small and medium sized companies, global service, etc).

The merger of Herambiente Recovery and Romagna Compost into Herambiente is also completed as of 31st December 2015. By virtue of this merger, the Cesena dry digestion plant (compost and digesters chain) and the Mantua sorting and recovery plant (selection and recovery chain) converged within the Herambiente Production Department. Both operations aim to uphold our leading role in the waste-to-energy sector, completing the value chain downstream of the standard treatment process.

Corporate-wise, Waste Recycling was finally acquired as of 31st December 2015, aiming to strategic business development and to supporting our leading role in the waste disposal industry in Tuscany.

Main developments in the Market Central Department

As to the Market Central Department, in addition to the above changes to the District Heating Department and to the Relevant Production Units, below are the main changes:

  • effective as of March 2015, Hera Comm's Top Business Market section underwent rearrangement, while a structure was outlined for Hera Energy Services, which oversees and develops integrated electrical and thermal energy management as well as energy efficiency and heat improvement services;

  • effective as of 1st April 2015, a structure was defined for Amga Energy&Services consistently with Hera Comm's steering guidelines, and Hera Comm's Costing and Forecasting function was also reorganized;

  • effective as of February 2015, Hera Comm's Corporate Market function was reorganized;

  • effective as of 1st January 2016, the new Energy Services Department was established to focus on the Energy Service business as well as to attain transversal cooperation between the group companies operating in this area and the District Heating Department.

  • effective as of 1 January 2016, the Direct Selling structure in the Top Business market was reallocated within the Marketing and Indirect Sales Management (renamed Marketing and Sales) in order to underpin the overall coverage of the Top Business customer segment, and to encourage interaction with strategic marketing setting activities.

Main development in the Central Entities Department

The treasury function was reallocated within the Central Department of Administration, Finance and Control.

In the Central Unit area, it is worth mentioning:

  • effective as of 1st January 2016, the reallocation of Uniflotte's supplier and general accounting within the Department of Administration, Finance and Control, in line with the Group's operating model;

  • with reference to the structural changes ensuing from the above spin-offs, the reallocation - effective as of 1st January 2016 - of the Insurance structure, which was previously under the Customer Technical Department and which reported directly to Risk Management and Insurance at the Central Legal and Corporate Affairs Department.

Finally, effective from July 2015, the Group's operating model in terms of business continuity management was formalised, aiming to define the management system that best ensures the business stability of priority corporate processes, in the event of highly impacting accidents.

New committees: Management Review and Business Review

In addition to the internal committees, appointed directly by the Board to perform an advisory and proactive role in specific areas of expertise, the Group's management provides for two collegial committees:

  • Management Review, which deals with examining and sharing corporate policies, strategies, goals and operational planning group-wide, as well as with fostering integration between corporate entities.

  • Business Review, whose duty is to report on periodic operating performance to each of the corporate business areas, and to assess the progress of specific budget unit actions set forth under the budget and business plans.


Consolidated financial statements

Income statement

million eurosnotes20152014
Other operating revenues2331325
Use of raw materials and consumables3(2,257)(1,965)
Service costs4(1,132)(1,144)
Personnel costs5(511)(497)
Amortisation, depreciation, provisions6(442)(427)
Other operating costs7(62)(57)
Capitalised costs82817
Operating profit 442441
Portion of profits (loss) pertaining to joint ventures and associated companies9128
Financial income1081145
Financial expense10(227)(299)
Total financial operations (134)(146)
Pre-tax profit 308295
Net profit for the year 194182
Attributable to:
Shareholders of the Parent Company 180165
Non-controlling interests 1417
Earnings per share12

For better comparison, certain non-recurring items have been reclassified below adjusted net profit.

In compliance with Consob Resolution no. 15519 dated 27 July 2006, the effects of relationships with related parties are accounted for in the appropriate statement of financial position outlined in paragraph 2.02.01 of these consolidated financial statements.


Comprehensive income statement

million euros20152014
Profit (loss) for the period   
Items reclassifiable to the income statement  194 182 
fair value of derivatives, change in the year 19 
Tax effect related to the other reclassifiable items of the comprehensive income statement  (1) 
Items not reclassifiable to the income statement    
Actuarial income/(losses) post-employment benefits 26 (16) 
Tax effect related to the other not reclassifiable items of the comprehensive income statement  (2) 
Total comprehensive income/ (loss) for the year  200 173 
Attributable to:    
Shareholders of the Parent Company  185 156 
Non-controlling interests  15 17 

In compliance with Consob Resolution no. 15519 dated 27 July 2006, the effects of relationships with related parties are accounted for in the appropriate statement of financial position outlined in paragraph 2.02.01 of these consolidated financial statements.


Statement of financial position

million eurosnotes31 Dec 1531 Dec 14
Non-current assets
Property, plant and equipment132,0282,064
Intangible assets142,8962,797
Property investments 44
Goodw ill15378379
Non-controlling interests16157153
Non-current financial assets17, 3112583
Deferred tax assets187368
Financial instruments - derivatives19108103
Total non-current assets 5,7695,651
Current assets
Trade receivables21, 311,5331,464
Current financial assets17, 313545
Current tax assets22, 312932
Other current assets23, 31226262
Financial instruments - derivatives19724
Cash and cash equivalents17, 30541834
Total current assets 2,4872,781
Non-current assets held for sale  1
TOTAL ASSETS 8,2568,433
million eurosnote31 Dec 1531 Dec 14
Share capital and reserves24  
Share capital 1,4741,470
Reserves 704676
Profit / (loss) for the year 180165
Group equity 2,3582,311
Non-controlling interests 145148
Total equity 2,5032,459
Non-current liabilities
Non-current financial liabilities25, 312,9443,121
Post-employment benefits26148163
Provisions for risks and charges27365337
Deferrred tax liabilities182415
Financial instruments - derivatives193438
Total non-current liabilities 3,5153,674
Current liabilities
Current financial liabilities25, 31484550
Trade payables28, 311,1211,194
Current tax liabilities22, 312630
Other current liabilities29, 31585494
Financial instruments - derivatives192232
Total current liabilities 2,2382,300

In compliance with Consob Resolution no. 15519 dated 27 July 2006, the effects of relationships with related parties are accounted for in the appropriate statement of financial position outlined in paragraph 2.02.01 of these consolidated financial statements.


Cash Flow

million eurosnotes31 Dec 1531 Dec 14
Pre-tax profit 308295
Adjustments to reconcile net profit to the cashflow from operating activities:   
Amortisation and impairment of property, plant and equipment 161171
Amortisation and impairment of intangible assets 177168
Allocations to provisions 10499
Effect of valuation using the equity method (12)-8
Financial expense / (Income) 146154
(Capital gains) / Losses and other non-monetary elements (including valuation of commodity derivatives) 8-12
Change in provisions for risks and charges (29)(20)
Change in provisions for employee benefits (12)(8)
Total cash flow before changes in net working capital 851839
(Increase) / Decrease in inventories 4(4)
(Increase) / Decrease in trade receivables (125)(120)
Increase / (Decrease) in trade payables (76)(12)
(Increase) / Decrease in other current assets/ liabilities 1347
Change in working capitals (63)(129)
Dividends collected 511
Interests income and other financial income collected 5054
Interests expense and other financial charges paid (159)(179)
Taxes paid (127)(89)
Cash flow from (for) operating activities (a) 557507
Investments in property, plant and development (110)(110)
Investments in intangible fixed assets (236)(219)
Investments in companies and business units net of cash and cash equivalents 30(67)(13)
Sale price of property, plant and equipment and intangible assets
(including lease-back transactions)
Divestment of unconsolidated companies and contingent consideration 3014
(Increase) / Decrease in other investment activities  (22)12
Cash flow from (for) investing activities (b) (427)(318)
New issues of long-term bonds 100 25
Repayments and other net changes in borrow ings (359) (139)
Lease finance payments  (5)(7)
Investments in consolidated companies 30(33)(5)
Share capital increase -
Dividends paid out to Hera shareholders and non-controlling interests (145) (137)
Change in treasury shares 10 (19) 
Cash flow from (for) financing activities (c)  (423)(282)
Effect of change in exchange rates on cash and cash equivalents (d) -
Increase / (Decrease) in cash and cash equivalents (a+b+c+d) (293) (93)
Cash and cash equivalents at the beginning of the year 834927
Cash and cash equivalents at the end of the year 541834

In compliance with Consob Resolution no. 15519 dated 27 July 2006, the effects of relationships with related parties are accounted for in the appropriate statement of financial position outlined in paragraph 2.02.01 of these consolidated financial statements.



Income statement for 2015

 GasElectricityWaterWaste ManagementOther servicesHeadquartersTotal
Direct revenues1,5601,5477738349684,818
Infracyclical revenues45645533035232
Total direct revenues1,6051,611778887126435,050
Indirect revenues144187-(43)-
Total revenue1,6191,615796894126-5,050
Amortization, depreciation and direct provisions104611001291533442
Amortization, depreciation and indirect provisions115161-(33)-
Total amortization, depreciation and provisions1156611613015-442
Operating result181391161006-442

Income statement for 2014

 GasElectricityWaterWaste ManagementOther servicesHeadquartersTotal
Direct revenues1,4481,36774683295264,514
Infracyclical revenues13688582948224
Total direct revenues1,4611,435754890124744,738
Indirect revenues20726201(74)-
Total revenue1,4811,442780910125-4,738
Amortization, depreciation and direct provisions8865951321631427
Amortization, depreciation and indirect provisions105151-(31)-
Total amortization, depreciation and provisions987011013316-427
Operating result178411071096-441

Reclassified financial position 2015

 Networking capitalNet non-current assetsProvisionsEquityNet borrowingsConsolidated Financial Statements
Total Assets1,9115,535--8108,256
Cash and other liquid assets    810810
Tax assets6273   135
Unallocated Group assets-448   448
Area assets1,8495,014---6,863
- of which:      
GAS6381,425   2,063
Electricity540621   1,161
Water2371,587   1,824
Waste management3721,270   1,642
Other Services62111   173
Total liabilities1,754245132,5033,4628,256
Financial liabilities and loans    3,4623,462
Tax liabilities5624   80
Unallocated Group assets -142,503 2,517
Area liabilities1,698-499--2,197
- of which:      
GAS500 146  646
Electricity439 25  464
Water304 109  413
Waste management393 212  605
Other Services62 7  69
Comprehensive total1575,511(513)(2,503)(2,652)-

Reclassified financial position 2014

 Net working capitalNet non-current assetsProvisionsEquityNet borrowingsConsolidated Financial Statements
Total Assets1,9025,464--1,0678,433
Cash and other liquid assets    1,0671,067
Tax assets7268   140
Unallocated Group assets 444   444
Area assets1,8304,952---6,782
- of which:      
GAS6261,402   2,028
Electricity520650   1,170
Water2451,542   1,787
Waste management3821,247   1,629
Other Services57111   168
Total liabilities1,749185002,4593,7078,433
Financial liabilities and loans    3,7073,707
Tax liabilities6715   82
Unallocated Group assets 3132,459 2,475
Area liabilities1,682-487--2,169
- of which:      
GAS506 139  645
Electricity459 26  485
Water272 106  378
Waste management383 207  590
Other Services62 9  71
Comprehensive total1535,446(500)(2,459)(2,640)-


Net financial position

€/mln 31-Dec-1531-Dec-14
a Cash and cash equivalents 541834
b Other current financial receivables3545
  Current bank debt (129)(176)
  Current portion of bank debt(285)(302)
  Other current financial liabilities (68)(69)
  Finance lease payables due w ithin 12 months (2)(3)
cCurrent financial debt(484)(550)
d=a+b+c Net current financial debt 92329
  Non-current bank debt and bonds issued (2,845)(3,021)
  Other current financial liabilities(6)(7)
  Finance lease payables due after 12 months (18)(25)
e Non-current financial debt(2,869)(3,053)
f=d+e Net financial position - CONSOB Communication No 15519 of 28/07/2006(2,777)(2,724)
gNon-current financial receivables12584
h=f+g Net non-current financial debt (2,652)(2,640)


"Our thirteenth annual financial report once again shows growing results and a good financial solidity, both of which indicate the validity and the disinclination towards risk that mark the strategies pursued by the Group. Thanks to an encouraging cash flow generation, the Board of Directors has proposed to allocate a 9 cent/euro dividend per share, in line with the five-year Business Plan presented on 11 January 2016 and favourably welcomed by the Market.

This year as well, we have decided to publish an HTML version of the financial report, to offer a more in-depth view of its contents and enrich it with multimedia and info-graphic tools. Given that transparent and increasing efficient communication is one of Hera's most important objectives, we have attempted to make the results of the 2015 financial year simple to consult, in a way that is both pleasant and ever more oriented towards the needs of the Group's various stakeholders."

An efficient financial and fiscal management, along with the good performance shown by Heracomm and activities in Networks, has brought the Group's cash flow to cover, in addition to dividends, all of the acquisition operations concluded in 2015 for a total amount of almost 100 million of euro. The good results reached in the energy and water sectors, as well as in the areas of development and efficiency, have allowed us to compensate for the negative effects of both weather conditions marked by temperatures above the seasonal averages in the last quarter and a slight decrease in incentives and profitability in the environment area.

This additional year of growth for Hera was matched by wide-ranging interventions in all activities whose processes and aims involve innovation, showing the utmost consistency with sustainability policies and shared value.

The close bonds established between innovation and social responsibility in every area are guiding the Group towards new levels of excellence, ultimately becoming a point of reference for our stakeholders".