Analyst presentation 1h2019

Analyst presentation
H1 2019
FINANCIAL
RESULTS
Non-stop growth“ “

262
274
289
'17 '18 '19
Ebitda (M€)
+4.3%
1H ’18/‘19
Ebit (M€) Net Profit (M€)
Debt/Ebitda (x)
Rolling
+5.6%
1H ’18/‘19
+8.4%
1H ’18/‘19
506
524
'17 '18 '19
H1 results
546
141
153
166
'17 '18* '19 '17 '18 '19
01GRUPPOHERA
Outperforming growth path
*Adjusted for extraordinary income related to Medea disposal
2.74x
2.62x
2.55x

524
546
(21.7)
+30.5
+12.5 +1.0
H1'18 Last resort
Market
Liberalised Regulated M&A H1'19
Ebitda growth drivers
(M€)
+22 M€ +4.3%
02GRUPPOHERA
Growth based on organic drivers and coming from all activities
Strong performance on both liberalised and regulated activities

Growth in all businesses
+22mln
EBITDA increase

Overview on H1 results by business
03GRUPPOHERA
Linear growth trends on track
Other (M€)
+18.3%
‘19/’18
9.9
12.6
14.9
'17 '18 '19
Networks (M€)
+6.5%
‘19/’18
'17 '18 '19
233.8
219.6
212.4
Energy (M€)
+3.2%
‘19/’18
'17 '18 '19
170.9
165.6
162.3
'17 '18 '19
Waste (M€)
+0.3%
‘19/’18
126.3
121.3
125.9

219.6
233.9+10.0 +2.3 +1.2 +0.8
H1'18 Water Gas Electricity D.H. H1'19
Ebitda growth
(M€)
+14 M€ +6.5%
04GRUPPOHERA
Networks
Efficiency and tariffs underpin growth
• Slight growth in new connections
Connections
Wacc
• Results benefitted from Wacc review in
Energy tariffs
Efficiency
• Positive efficiency gains and Premiums
in water business

125.9 126.3+2.3 +2.4
+5.5
(9.8)
H1'18 Bio-methane
plant
Aliplast Price trend Negatives H1'19
Ebitda growth
(M€)
+0.4 M€ +0.3%
05GRUPPOHERA
Waste
Capitalizing partially positive trend
• Bio-methane plant started operations
Aliplast
Prices
New plants
• Aliplast posted further growth
• Positive price trend confirmed
Negative
• Plant availability (WTE maintenance, landfill)

165.6
170.9
(21.7)
+10.6
+16.4
H1'18 Last resort
Mkt
Mkt exp. Power
Gen.
H1'19
Ebitda growth
(M€)
+5.3 M€ +3.2%
06GRUPPOHERA
Energy
Expanded customer base to 2.6 mln
Last resort market
• Safeguarded margins affected by 2018 tenders partially
offset by increased Default and FUI
Power generation
• Power generation benefitted from ancillary services and
Teverola plant back to operation
Market expansion
• 12 months Market expansion:
• +135K electricity clients
• + 57K gas clients

Sound cash generation
2.55x
Net Debt / Ebitda rolling

07GRUPPOHERA
Good 6 month cash generation
“Cash neutral” after annual dividend payment
+377
(3)
+13
(18)
(215)
(161) (0)
(97)
Op. CF NWC Provision Capex Dividends M&A and
Buy back
Ch. in
"Cash"
Debt
IFRS 16
(non cash)
+158 M€
Free Cash Flow
(M€)
Debt/Ebitda
• Debt at 2.685 b€
(+0.1b€ “non cash” increase)
• Confirmed at 2.55x
Debt refinancing
• 500m€ Green bond issued end of June
(7x oversubscription, yield 1.08%)
• Avg debt duration of 6 years

M&A & Dev. Projects
and
Closing remarks 60%
Business plan to 2022 execution

Hera – Ascopiave asset swap
08GRUPPOHERA
Squaring of the circle
Gas distribution assets
(PD1, UD3)
Customers in
North-East
Customers
EstEnergy
>1mln customers
Amgas Blu
~3% HeraComm
Hera
Group
Ascopiave
Group
~168m€
~54m€
~44m€
~601m€
Asset involved^
(Equity value in M€)
174k*196k
92k600k
4k45k
*Of which ~90k under Maggior Tutela
~412m€
^Values subject to adjustment in the framework agreement under way

Biomethane plant
+0.13 mtons
treated per annum
Cordenons landfill
+0.7 mtons
of capacity
Pistoia landfill
+1.4 mtons
of capacity
Strengthening our waste treatment platform
09GRUPPOHERA
Additional capacity to fully embed price trends in our results
Ravenna landfill
+0.3 mtons
of capacity
Development projects
Acquisition

Closing remarks: strong visibility on plan execution
10GRUPPOHERA
Value creation on track
77% 60%
0.
4+ +200m€+89m€ +80m€
Ebitda ‘22
Growth locked in
M&A
locked in
SYNERGIES ‘ON TOP’
Org. Growth
accounted
62%
1
30%
+31m€
Gas tenders Time spent
of 5 years BP
+ =
0%

Q&A and Appendix
Further details on H1 2019 results are available in this
section.
Web: www.gruppohera.it

11GRUPPOHERA
Annex: P&L
H1 ’18 H1 ’19
REVENUES 3,176.5 3,620.6 +14.0%
EBITDA 523.6 545.9 +4.3%
Ebitda margin 16.5% 15.1%
Depreciation and provisions (250.0) (257.0)
EBIT 273.6 288.9 +5.6%
Financial costs (38.8) (40.6)
Figurative interests (IAS) & Leasing (9.0) (10.8)
Income from Associates & J.V. 8.6 6.5
PRETAX PROFIT 234.4 244.0 +4.1%
Tax (72.0) (70.1)
Tax rate 30.7% 28.7%
Special items* 4.8 0.0
Minorities (9.1) (7.7)
NET PROFIT POST MINORITIES 158.1 166.2 +5.1%
Profit & Loss
(M€)
* Capital gains related to the Medea disposal

H1 2018 H1 2019 Ch.
142.8 137.7 (5.1)
120.9 116.7 (4.3)
119.8 115.0 (4.8)
H1 2018 H1 2019 Ch.
1,120.2 1,149.3 +29.2
1,177.5 1,110.4 (67.1)
2,297.6 2,259.7 (37.9)
H1 2018 H1 2019 Ch.
412.3 430.8 +18.5
112.8 122.8 +10.0
H1 2018 H1 2019 Ch.
561.4 595.1 +33.7
125.9 126.3 +0.4
12GRUPPOHERA
Annex: Waste and Water
(m€)
Revenues
Ebitda
(m€)
Revenues
Ebitda
Data
Aqueduct (mm3)
Sewerage (mm3)
Purification (mm3)
Waste: Profit & Loss
Waste: KPIs
Water: Profit & Loss
Water: KPIs
Data
Urban W. Volumes (Kton)
Special W. Volumes (Kton)
Waste from third parties

H1 2018 H1 2019 Ch.
1,827.3 1,784.9 (42.4)
2,820.1 4,215.2 +1,395.0
1,487.0 2,833.2 +1,346.2
307.8 303.8 (4.0)
1,333.1 1,382.0 +48.8
1,412.8 1,469.9 +57.1
H1 2018 H1 2019 Ch.
5,866.5 6,124.5 +258.0
1,272.1 1,420.1 +148.0
1,514.7 1,508.7 (6.0)
1,013.6 1,148.1 +134.5
H1 2018 H1 2019 Ch.
1,184.2 1,208.4 +24.1
84.0 86.3 +2.3
H1 2018 H1 2019 Ch.
1,128.8 1,502.0 +373.2
188.4 195.6 +7.2
Data
Volumes sold (GWh)
of which Salvaguardia (GWh)
Volumes distrib. (GWh)
Clients ('000 unit)
Data
Volumes distrib. (mm3)
Volumes sold (mm3)
of which trading (mm3)
District Heating (GWht)
Final retail volumes (mm3)
Clients ('000 unit)
13GRUPPOHERA
Annex: Gas and Electricity
(m€)
Revenues
Ebitda
(m€)
Revenues
Ebitda
Gas: Profit & Loss
Gas: KPIs
Electricity: Profit & Loss
Electricity: KPIs

Analyst presentation 1h2019

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Analyst presentation 1h2019