Download - 1Q 2016 Consolidated Results (May 4, 2016)

1Q16 CONSOLIDATED RESULTS MAY 4th 2016

Investor Relations 1

1Q16Consolidated ResultsMay 4th, 2016

MATTEO DEL FANTE

CHIEF EXECUTIVE OFFICER

PIERPAOLO CRISTOFORI

CHIEF FINANCIAL OFFICER



Agenda

1Q16 Results

Annexes

Highlights 3

5

13



Highlights

New Regulatory Framework

M&A

Drivers for 1Q16 Results

WACC from 6.3% to 5.3%

Time-lag shortened

More selective approach for incentives

Grid Fee less exposed to consumption volatility

RHV Grid acquisition: allowed opex + TLC contract

Tamini-TES combination

Efficiencies on

Opex

Debt management



158€mn Total Capex

7,687€mn Net Debt

517€mn Revenues

162€mn Group Net Income1

395€mn EBITDA

HighlightsKey Financials

1. Attributable to Terna

513€mn in 1Q15 402€mn in 1Q15 165€mn in 1Q15

177€mn in 1Q15 8,003€mn at YE15



€ mn 1Q15 1Q16 Δ yoy Δ % yoy

Regulated Activities 479 471 -7 -1.5%

Non Regulated Act. 32 43 12 37%

o/w Tamini 19 27 8 42%

Other Non Regulated Act. 12 16 4 28%

IFRIC12 3 3 0 -10%

Total 513 517 4 0.8%

479 471

3

-7 4 0 8

3

19 2712 16

1Q15 ∆RegulatedActivities

∆Other

Non RegulatedActivities

∆IFRIC

∆Tamini

1Q16

Regulated ActivitiesIFRIC12TaminiOther Non Regulated Act.

1Q16 ResultsRevenues

513517+4

KEY FIGURES TOTAL REVENUES EVOLUTION

Total Revenues

517€mn+0.8%yoy

Regulated Activities

471€mn-1.5% yoy

Non Regulated Activities

43€mn

€mn


TaminiIFRIC12

Other Non Regulated Act.

1Q15 1Q16



443 431

32 -12 -4 9 284 12

1Q15 ∆ Transmission

∆ Dispatching

∆ Other

1Q16

TransmissionDispatchingOther

1927

12

4 8 16

1Q15 ∆Other


∆Tamini

1Q16


Tamini

Revenues Analysis

479 471

-7

+12

€mn

€mn

REGULATED ACTIVITIES

NON REGULATED ACTIVITIES

NOTE: figures net of IFRIC12 – Managerial Accounting

3243

Tamini


Tamini and EPC Growth

1Q15 1Q16

1Q15 1Q16

1Q16 Results

-16

RHV Grid 12 €mn

Grid Fee New Regulatory Period

Contribution



€ mn 1Q15 1Q16 Δ yoy Δ % yoy



o/w Tamini 20 29 9 48%

Other Non Regulated Act. 4 7 3 87%

IFRIC12 3 3 0 -10%

Total 112 122 10 9.3%

86 84

3

-2 30

9

3

20 29

4

7

1Q15 ∆Regulated

Activities

∆Other


∆IFRIC

∆Tamini

1Q16


Serie2

Tamini

Other Non Regulated Activities

Opex

112

122+10

KEY FIGURES TOTAL COSTS EVOLUTION

Total Costs

122€mn

€mn


84€mn

Non Regulated Activities

36€mn


TaminiIFRIC12


1Q15 1Q16

1Q16 Results



2029

4

3 9 7

1Q15 ∆Other


∆Tamini

1Q16

49 45

28-4 7

-5

35

8 3

1Q15 ∆ Labour

Costs

∆ External

Costs

∆ Other

1Q16

Labour Costs

External Costs

Other

Opex Analysis

86 84

-2

+12

€mn

€mn

REGULATED ACTIVITIES

NON REGULATED ACTIVITIES

NOTE: figures net of IFRIC12 – Managerial Accounting

RHV GridService Contract

23

36

Tamini


1Q15 1Q16

1Q15 1Q16

Services

56%EBITDA Margin

1Q16 Results

EfficiencyVoluntary Turnover Programme



From EBITDA to Net Income

KEY FIGURES PROFIT & LOSS

Group EBITDA

395€mn

Group EBITDA Margin

76.4%

Group Net Income1

162€mn

-1.6%yoy

-1.8%yoy

€mn

395

264 245162

131

1983

EBITDA D&A EBIT NetFinancialExpenses

PBT Taxes GroupNet Income

€ mn 1Q15 1Q16 Δ Δ %

EBITDA 402 395 -7 -1.6%

Ebitda % 78.2% 76.4%

D&A 120 131 11 9.1%

EBIT 281 264 -17 -6.2%

Net Financial Expenses 31 19 -12 -38%

PBT 250 245 -6 -2.2%

Tax Rate 34% 34%

Taxes 85 83 -2 -2.1%

Group Net Income1 165 162 -3 -1.8%

1. Attributable to Terna

1

1Q16 Results



Category (€mn) 1Q15 1Q16 Δ yoy Δ % yoy

Capex at 1% Incentive 48 43 -5 -11%

Capex at Base Return 118 107 -11 -9.5%

Regulated Capex 167 150 -17 -10%

Other 11 8 -3 -25%

Total Group Capex 177 158 -19 -11%

Capex

KEY FIGURES BREAKDOWN

Total Capex

158€mn

NOTE: Figures in accordance with AEEGSI resolutions

1. Of which 5mn related to Capitalized Financial Charges

1

1Q16 Results

Regulated Capex

150€mn



72%

21%

7%Terna SpA BondsEIB LoansBanks

7,6878,003

295

211 15819 14

FY15 Operating…Δ WC & Other capex net financial dividend 1Q16

Net Debt Evolution & Financial Structure

KEY FIGURES

Free Cash Flow1

348€mn

GROSS DEBT BREAKDOWN4

8.1€bn

1. see Annex “Consolidated Cash Flow” for details2. Including Other Fixed Assets Changes, Change in Capital & Other3. Including Cash Flow Hedge accruals and other4. IAS accounting

Dec.31,

2015

Operating

Cash

Flow1

Δ WC

&

Other2

-315

Capex

FCF AND NET DEBT EVOLUTION€mn

Fixed/floating ratio

Calculated on Net Debt

62/38

Net Debt

7,687€mn

Mar. 31,

2016

Free Cash Flow

348

Debt

Service

Dividends

&

Equity3

1Q16 Results



THANK YOU.QUESTIONS?

MATTEO DEL FANTE

CHIEF EXECUTIVE OFFICER

PIERPAOLO CRISTOFORI

CHIEF FINANCIAL OFFICER



Annexes



24.5 24.7

26.6

30.3

24.6

26.6

25.6 26.025.5

26.3 26.9

25.7

23

25

27

29

31

Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

Montly energy demand

Previous Year

24.1

24.9

26.3

32.1

25.126.5

25.9

25.7 25.8

26.3

25.4

26.0

23

25

27

29

31

33


Monthy energy demand Previous Year

AnnexElectricity Market Trends – Last 12 Months

TWh

TWh

DEMAND AS REPORTED (TWh)

NOTE: 2014 final figures, 2015 & 2016 provisional figures (as of April 2016)

1. For temperature and number of days

DEMAND ADJUSTED1 (TWh)

1Q15 1Q16 Δ %

78.8 77.6 -1.5%

1Q15 1Q16 Δ %

80.3 78.9 -1.8%


YoY Chg% -2.2% -0.5% -1.0% 8.5% 3.0% 1.2% -0.7% -0.6% -0.4% -0.9% -2.2% -2.2%


YoY Chg% -0.6% -1.7% -0.1% 13.7% 5.8% 1.2% -1.9% 0.9% 0.6% -1.7% 0.2% -2.9%



€ mn 1Q15 1Q16 Δmn Δ%

Transmission 443 431 -12 -2.7%

Dispatching 32 28 -4 -12%

Other 2 4 12 9 230%



IFRIC12 3 3 0 -10%

Total Revenues 513 517 4 0.8%

Labour Costs 49 45 -4 -7.7%

External Costs 28 35 7 24%

Other 8 3 -5 -59%



IFRIC12 3 3 0 -10%

Total Costs 112 122 10 9.3%

EBITDA 402 395 -7 -1.6%

D&A 120 131 11 9.1%

EBIT 281 264 -17 -6.2%

Net Financial Charges 31 19 -12 -38%

Pre Tax Profit 250 245 -6 -2.2%

Taxes 85 83 -2 -2.1%

Tax Rate (%) 34% 34%

Total Net Income 165 161 -4 -2.3%

Minority Interest - -1 -1

Group Net Income 165 162 -3 -1.8%

Consolidated Income Statement1

Annex

1. Managerial Accounting2. Quality of Service + Other Revenues



€ mn 1Q15 1Q16 Δmn Δ%

Labour Costs 56 54 -2 -4.1%

Services 31 41 10 31%

Materials 13 20 8 61%

Other 9 5 -4 -48%

IFRIC12 3 3 0 -10%

Total Costs 112 122 10 9.3%

Group Costs BreakdownAnnex



€ mn Dec. 31,2015 Mar. 31,2016 Δmn

PP&E 12,079 12,082 3

Intangible Asset 520 514 -6

Financial Inv. and Other 90 91 1

Total Fixed Assets 12,688 12,687 -1

Net WC -962 -1,145 -183

Funds -378 -362 17

Total Net Invested Capital 11,349 11,181 -168

Financed by

Consolidated Net Debt 8,003 7,687 -316

Total Shareholder's Equity 3,346 3,494 148

Total 11,349 11,181 -168

D/E Ratio 2.4 2.2

D/D+E Ratio 0.7 0.7

Number of Shares ('000) 2,010 2,010

Consolidated Balance SheetAnnex



€ mn 1Q15 1Q16 Δmn

Total Net Income 165 161 -4

D&A 120 131 11

Debt Service 31 19 -12

Net Change in Funds -12 -17 -5

Operating Cash Flow 304 295 -9

∆ Working Capital & Other 1 344 211 -133

Cash Flow from Operating Activities 649 506 -142

Capital Expenditures -177 -158 19

Free Cash Flow 471 348 -123

Dividends & Equity 2 9 -14 -23

Debt Service -31 -19 12

Change in Net Cash (Debt) 450 315

Consolidated Cash FlowAnnex

1. Including, Other Fixed Assets Changes, Change in Capital & Other2. Including Cash Flow Hedge accruals and other



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Download - 1Q 2016 Consolidated Results (May 4, 2016)

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