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Financial Results 1Q 2026
Message from the Executive Chairman of the Board
The start of 2026 brings solid evidence
The first quarter of 2026 provided strong signals, with the achievement of a solid set of fundamentals. This is proven by the slightly growing Net Income, driven by structural factors, as well as by the strong cash generation, which covers a significant share of the outflow due to the M&A already completed through the acquisitions of Sostelia and SEA Ambiente.
The consistent financial strength - evidenced by a leverage ratio of 2.6 times, unchanged from year-end levels - further reinforces Hera’s profile: a reliable company, capable of maintaining its long track record of healthy results despite the challenges due to the volatility of the external environment; but also a company that can rely on a solid financial structure to seize new investment opportunities and continue, with discipline, to consolidate the market step by step.
Cristian Fabbri
Dear Shareholders,
first-quarter results demonstrate how Hera can remain firmly on the path set out in the Business Plan, having achieved a slight improvement in the key indicators of the Income Statement, despite the absence of any contribution from those temporary opportunities that the Group had successfully leveraged during the first three months of the previous year.
The commitment to deliver double-digit Total Shareholder Return is grounded in the strength of fundamentals
The 0.2% growth recorded at EBITDA level translated into an increase of 0.6% both at EBIT and Net Profit level. In addition to demonstrating the Group’s ability to deliver steady and structural operational growth, this performance also highlights its effectiveness in financial and fiscal management: an essential prerequisite for delivering our shareholders the value creation that we explicitly committed to in the Business Plan.
The approximately 419 million euro of EBITDA achieved in the first quarter of 2026 should be compared with around 385 million euro recorded in the same period of 2025, excluding 33 million of temporary opportunities, mainly related to the gas business in the Default segment of Last Resort markets - which has become unattractive in terms of margins in the latest tenders and, therefore, which we have discontinued.
Overall, therefore, on a like-for-like basis, EBITDA
growth would be close to 9%.
All the businesses in Hera’s portfolio contributed to the first-quarter 2026 EBITDA of 419 million euro
The significant contribution from the Energy area, amounting to 24 million euro, was driven by the strong performance of the Sales business and Value-Added Services.
Networks contributed with over 11 million euro, with strong performance especially in Water and Gas businesses, reflecting the benefits of the continuous investments envisaged in the Plan and the ongoing efforts to achieve further efficiencies.
Also noteworthy was the 5 million euro increase achieved in the Waste business, which confirmed that this area can rely on the strong performance of a broad range of activities while benefitting from the recent acquisitions of Sostelia and SEA Ambiente - already contributing for 2 million euro at EBITDA level in the first quarter.
The bottom line of the P&L reflects sound operational management and a prudent risk profile
Net Profit, amounting to 155 million euro and slightly up compared to the 154 euro million recorded in the first quarter of 2025, benefited from lower Provisions - reflecting the reduced exposure to customers in Last Resort markets - as well as from the stability of Net Financial Charges.
Hera’s debt, 90% of which is fixed-rate, consists primarily of listed bonds with medium- to long-term maturities. The rating agencies continue to assign our debt a solid investment-grade rating with a stable outlook, appreciating the continued and visible cash flow generation that Hera is expected to deliver.
Debt-to-EBITDA ratio at 31 March 2026 remains at 2.6x, unchanged from year-end 2025
In the quarter that just ended, the cash flow generation covered not only the investments but also a large portion of the acquisitions’ expenditure, allowing financial flexibility to remain unchanged.
Hera’s solid and reliable profile has come out from this quarter stronger
With a solid set of quarterly results and its financial strength intact, Hera thus fully reaffirms its profile as a reliable company that has structured its portfolio and management style in a prudent and risk-averse way.
At the same time, with these results, Hera also confirms it can continue to play the role of consolidator in a market that remains largely inefficient due to its fragmented structure.
Lastly, we should not forget that the broad availability of financial resources we can rely on enables us to face and manage any potential worsening of the energy crisis - which could also have financial impacts - without negative consequences. We have already demonstrated in the past, during the 2022 energy crisis, how important it was to be able to use the resources at our disposal to purchase and store gas for one billion euro: a decision that allowed us to fully meet the demand for the following heating season while also optimising the returns on the purchases made.
Having broad financial flexibility, therefore, is not only
a guarantee of business protection but also a
prerequisite for promptly seizing potential opportunities.
After successfully concluding the 2025 Fiscal Year, with the Annual Shareholders’ Meeting held on April 29 that approved the Financial Statements and a dividend increase to 16-euro cents, as the management team, we are beginning our new three-year term by continuing to hold grounds firmly, confident that we will succeed in consistently executing the Plan’s strategy.