375
million euro
shared value Ebitda,
36% of total Ebitda
(+14% over 2017)
184
million euro
shared value investments,
40% of total investments
71/100
customer satisfaction
our annual survey confirms the high
quality of Group services

The Hera Group continues to report “shared value” EBITDA (started for the first time with the 2016 sustainability report), i.e. the portion of EBITDA resulting from projects and activities that respond to the “calls to action” classified in the three CSV Drivers: in 2018, this value totalled Euro 375.2 million (equal to 36% of the total), a 14% increase compared to the previous year. This result is in line with the 2018-22 Business Plan, created so that approximately 40% of 2022 EBITDA will derive from business activities that respond to the priorities of the global sustainability agenda.

A roughly 14% increase in “shared value” EBITDA is recorded against a 5% increase in the Group’s overall EBITDA (equal to Euro 1,031 million) compared to the previous year.

The prevailing contribution derives from activities and projects related to the efficient use of resources (Euro 260.6 million), followed by those related to innovation and contribution to development (approximately Euro 78.2 million). The smart use of energy accounts for Euro 66.9 million in 2018.

As pointed out in the diagram, around 70% of “shared value” EBITDA generated in 2018 is mainly the result of activities and projects that meet the “calls to action” of the 2030 UN Global Agenda for an “efficient use of resources”. As regards “Impact Area”, the key role played by the Group in creating value with activities related to the transition to a circular economy (+28% compared to 2017) and to the sustainable management of water resources (+8% compared to 2017) emerges.

Around 17% of “shared value” EBITDA was instead generated from activities belonging to the Global Agenda areas that lead towards a “smart use of energy”. 70% of this share of EBITDA comes from initiatives aimed at the promotion of energy efficiency, through the development of commercial offers to Group customers and the reduction of internal energy consumption, with particular attention to water services, public lighting and district heating. The residual percentage of EBITDA for the smart use of energy is connected to the spreading of renewable energy achieved both with commercial activities and through the production of energy from renewable sources.

Lastly, the Hera Group generates about 13% of “shared value” EBITDA with reference to innovation, digitalisation and its contribution to an inclusive development focused on the environment and stakeholders. With regard to the “spreading of innovation and digitalisation”, shared value was achieved also through telecommunication services, via the Acantho company, and through projects for the digitalisation of operational and data analysis processes with a view to their optimisation. “Economic development and social inclusion” was especially achieved through generated employment and the outsourcing of environmental services to social cooperatives. This allows disadvantaged individuals to be employed and also leads to economic benefits for the Public Administration (lower welfare costs). Lastly, in terms of “air and soil protection”, the purchase of vehicles with a lower environmental impact and the expansion of the volume served by district heating were privileged.

“Shared value” EBITDA growth in 2018: an increase of Euro 46.5 million (+14%) compared to 2017
CSV Drivers Impact Area 2018 main results

Smart use of energy:

Euro +2.7 million

Promotion of energy efficiency: Euro -1.0 million

 

Spreading renewable energy:
Euro +3.7 million

  • Saving from energy efficiency measures: over 8,800 toe saved at the end of 2018
  • Increase in LED light points in public lighting (14.9% in 2018 compared to 14.2% in 2017) offset by a reduction in margins in industrial cogeneration as a result of the reduction in the value of white certificates
  • Increase in “Nature Package” customers which guarantees the renewable provenance of the electricity purchased: 12.2% in 2018 (8.7% in 2017)
  • Increase in margin/production of renewable electricity from anaerobic biodigesters and geothermal energy used for district heating

Efficient use of resources:

Euro +42.1 million

Transition towards a circular economy:
Euro +34.7 million

 

Sustainable management of water resources:
Euro +7.4 million

  • Further reduction in the use of landfills for municipal waste (5% municipal waste collected and disposed of compared to 7% in 2017) and increase in separate waste collection (62.5% compared to 57.7% in 2017) and in recycling rates
  • Aliplast production increase (84 thousand tonnes of recycled plastic products in 2018; +4% compared to 2017)
  • Increase in industrial waste recovered by HASI (rising from 30.5% to 41.6% in 2018) and of Herambiente selection plants (rising from 76.2% to 77.2%)
  • Increase in urban areas >200 P.E. adjusted to sewage and purification regulations (rising from 83.6% to 91.3%)

Innovation and contribution to the development of the area:

Euro 1.7 million

 

  • Innovation and digitalisation: investments in Utility 4.0 in order to optimise operating processes and management, and remote reading for 34% of meters at the end of 2018 (22% in 2017)
  • Innovation and digitalisation: Acantho business development (telecommunications and connectivity)
  • Social inclusion: 6.6% of customers with at least one instalment (slightly rising compared to 2017)
  • Social inclusion: 816 disadvantaged workers hired (slight increase compared to 2017)
  • Increase in the margins of district heating and volume served (+1% compared to 2017) 

The total deviations of shared value EBITDA do not correspond to the sum of the single deviations in the single drivers and in the single impact areas, due to activities that affect several components.

 

“Shared value” EBITDA growth 2017-21