• Share
  • Email
  • Embed
  • Like
  • Save
  • Private Content
Hera Group, Analyst presentation: 2011 9 months results and 2011-2015 business plan
 

Hera Group, Analyst presentation: 2011 9 months results and 2011-2015 business plan

on

  • 620 views

On 10th November 2011 at 15:30 (Italian time), Hera Group Management presents and discusses 2011 9 months results and 2011-2015 business plan

On 10th November 2011 at 15:30 (Italian time), Hera Group Management presents and discusses 2011 9 months results and 2011-2015 business plan

Statistics

Views

Total Views
620
Views on SlideShare
620
Embed Views
0

Actions

Likes
0
Downloads
3
Comments
0

0 Embeds 0

No embeds

Accessibility

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    Hera Group, Analyst presentation: 2011 9 months results and 2011-2015 business plan Hera Group, Analyst presentation: 2011 9 months results and 2011-2015 business plan Presentation Transcript

    • Q3 2011 Results &www.gruppohera.it BP 2011-2015
    • IndexQ3 2011 results 1 Annex: further details WASTE 16Business plan Annex: further details NETWORKS 20 Sector topic and Hera platform 7 Annex: further details ENERGY 24 Hera strategy 8 Ebitda growth drivers 9 Annex: Business plan by business 27 M&A strategy 10 Disclaimer 32 Ebitda by strategic areas 11 Target by business area 12 Risk exposure 13 Capex plan and financial structure 14 Closing remarks 15
    • Q3 2011 results at a glance
    • First 9 month 2011 results confirm solid platform 9m ’11 growth rates Strong set of achievements in first 918% +15.4% months despite summer period within16%14% Q3.12% +10.2%10% +8.2%8% Growth underpinned by all businesses,6%4% and particularly by Energy activities with2% commercial development and procurement0% position more than offsetting volatility and Ebitda Ebit Pretax Profit first half lower consumptions. 2011 quarters growth M&A progressed through acquisition of45.0 Sadori Gas. +40 m€40.0 +5m€ +35 m€ Positive results in all businesses driving35.0 Ebitda up by +35.3m€ confirming30.0 business plan targets. (10) m€25.020.0 Debt at 2.06 b€ confirming D/Ebitda ratio.15.0 Confirmed credit ratings by S&Ps and Q1 11 Q2 11 Q3 11 9m 11 Moodys. 1
    • First 9 month 2011 results highlights positive growth 9m 2011 posted a growth Ebitda growth Drivers (m€) (m€) 9m 10 9m 11 Ch. Ch.% +5.0 +5.7 466.7 431.4 +24.6 450 (1) Revenues* 2,732.9 3,039.7 +306.8 +11.2% Ebitda 431.4 466.7 +35.3 +8.2% (2) Ebit 218.2 240.5 +22.3 +10.2% 350 (3) Pre tax Profit 135.4 156.2 +20.8 +15.4%(4) Tax (56.3) (72.2) (15.9) +28.2% Net Profit 79.1 84.0 +4.9 +6.3% 250 Minorities (10.7) (16.4) (5.6) +52.5% 9m 10 Syn & New M&A 9m 11 Hera Profit 68.4 67.7 (0.7) (1.0%) Org.G. Plants (1) Tariffs, commodity prices and market expansion Ebitda by strategic area (m€) 466.7 (2) 431.4 Higher accruals to Bad 12.7 Debt and provisions 10.9 149.2 +7.9% 139.3 (3) Substantially stable interest charges +0.5% 209.0 208.0 (4) Higher incidence of IRAP and additional Robin Tax 73.2 95.8 +30.9% (~2m€ effect). 9m 10 9m 11 ENERGY NETWORKS WASTE OTHER* Revenues include sales, change in stock and other revenues 2
    • First 9 month 2011: WASTE & WATER resultsWaste increase margins despite lower volumes Water shows enhanced volumes and tariffs9 months results (m€) 9 months results (m€)M€ 9m 10 9m 11 Ch. % M€ 9m 10 9m 11 Ch. %Revenues 531.7 550.2 +3.5% Revenues 433.2 439.2 +1.4%Operat. Costs (298.0) (299.6) +0.6% Operat. Costs (253.7) (253.8) +0.0%Personnel (113.1) (112.5) (0.6%) Personnel (79.0) (79.3) +0.4%Capitaliz. 18.7 11.1 (40.3%) Capitaliz. 9.8 5.5 (43.8%)Ebitda 139.3 149.2 +7.1% Ebitda 110.2 111.6 +1.3%9 months waste from third parties Fresh water volumes(k ton) (m cubic meter) (2.3%) 75 3 000 2 8 00 2,609 2,549 72 2 6 00 2 4 00 2 2 00 2 000 1 8 00 1,202 1,181 Special 62 64 2010 1 6 00 1 4 00 59 2011 1 2 00 1 000 Urban 56 8 00 6 00 4 00 1,407 1,368 2 00 0 5 0 9m 10 9m 11 Q1 Q2 Q3Revenues growth underpinned by tariff increase (+3%) and Revenues growth underpinned by tariff increase (+2.8%)higher electricity production (from 400 to 490 GWh). and higher volumes related to the dry summer season.Ebitda benefit from Enomondo biomass plant contribution Still stagnant the works for third parties.(+5m€) and from enhanced WTE electricity production (mainlyrelated to Rimini WTE). Posted lower treatment cost thanks Ebitda benefit from operating efficiencies rebalancingalso to better weather conditions. higher electricity costs.Sorted collection reached 49.2% of urban waste. Ebitda incidence on revenues confirmed at 25.4%. 3
    • First 9 month 2011: GAS & ELECTRICITY results Gas growth despite lower volume sold Electricity factoring in market expansion 9 months results (m€) 9 months results (m€) M€ 9m 10 9m 11 Ch. % M€ 9m 10 9m 11 Ch. % Revenues 840.3 977.2 +16.3% Revenues 999.2 1,136.3 +13.7% Operat. Costs (684.3) (798.8) +16.7% Operat. Costs (952.1) (1,069.3) +12.3% Personnel (46.1) (50.1) +8.7% Personnel (17.1) (20.4) +19.6% Capitaliz. 20.8 9.4 (55.0%) Capitaliz. 10.3 8.9 (14.1%) Ebitda 130.7 137.7 +5.4% Ebitda 40.4 55.5 +37.6% Gas Volumes Electricity sold (m cubic meter)3 0002 8 00 (TWh)2 6 00 2,2462 4 002 2 00 1,990 3 000 2 9 00 2 8 00 2,543 2,6652 000 2 7 00 2 6 00 2,272 2,2021 8 001 6 00 524 901 2 5 00 2 4 00 2 3 00 2 2 00 2 1 00 1,864 1,8471 4 001 2 00 Trading 2 000 1 9 00 1 8 00 1 7 00 1 6 001 000 1 5 00 8 00 6 00 1,466 1,346 Sales 1 4 00 1 3 00 1 2 00 1 1 00 2010 1 000 4 00 9 00 8 00 2011 7 00 2 00 6 00 5 00 0 4 00 3 00 2 00 1 00 0 9m 10 9m 11 Q1 Q2 Q3 Revenues growth mainly driven by higher commodity prices, higher distribution revenues, expanded customer base (+3.5% in 9m) and increased trading activities. Revenues growth mainly driven by higher volumes (+31% These positive contributions offset lower volumes (gas 9m/9m) related to increased “salvaguardia” services and and district heating) related to mild winter season. market expansion (+22.7% customers in 9m). Ebitda increase mainly driven by enhanced margins in Optimisation of asset management. supply activities and optimisation in logistic/ procurement Ebitda margin up by 90 bps. costs. Trading activities yield positive growth in volumes at lower margins vs extraordinary 9 months 2010 performance. 4
    • Financial issues: Capex and cash flowsCapital Exp. & Investments M€ 9m 10 9m 11 Capex declined following completion on waste Waste 70.0 44.8 treatment assets (WTE). Water 67.3 69.4 Gas 33.3 34.3 Electricity 31.4 20.2 Other 10.1 10.4 Net Working Capital increased by 88 m€ Holding 32.5 34.0 mainly due to higher gas in storage and Investments 2.5 0.0 expanded commercial activity (+300m€ Capex 247.1 213.1 revenues). Debt come in at 2.06b€ confirming D/Ebitda 9m 2011 free cash flows^ ratio of Q3 ‟10. 300 +260 250 200 Moody‟s and S&P‟s confirmed Hera rating 150 100 50 +3 00 (213) -50 (88) (18) -100 (7) (64.6) -150 Op. Capex Dismis. NWC Minor. Other Free CF* CF 5 ^Before dividends and M&A *Op.CF=Net profit + D&A + ch. provisions
    • Closing remarks on Q3 interim resultsStrong set of achievements in first 9 monthsdespite summer period within Q3.Growth underpinned by all businesses even inslow increasing economic environment and Q3 ’11 growth ratesnegative impact of climate conditions. 18% +15.4% 16% 14% 12% +10.2%M&A is progressing well; with Aimag negotiations 10% +8.2%ongoing. 8% 6% 4% 2%Hera obtained the preliminary assignment for 0%the new WTE in Florence. Authorisation process Ebitda Ebit Pretax Profitwill soon start (to obtain “VIA”).Financial structure is sound as confirmed byrating agencies. Solid platform to reach year end & Business plan targets 6
    • Business plan 2011-2015
    • Challenging scenario opens up opportunities for Hera platformBusiness issues Hera platform Energy upstream over-capacity Flexible Energy upstream position Competition in Energy downstream Platform for cross selling and expansion Waste infrastructure shortage Unique & integrated asset base / expertise Gas distribution tenders Strong market share in all catchment area Water referendum ATO tariff agreement up to end 2012Financial issues EPS downward revision Multiutility model with low risk exposure Financial rebalancing Financial soundness/flexibility Portfolio rationalisation Presence limited to core areas 7
    • Sticking to multi-utility expansion strategies HERA STRATEGIC PRIORITIES 1 From 1.8 to 2.0 m customers Downstream expansion 2.5 contracts per customer 2 Confirm gas distrib. in territory Organic growth Extract further efficiency gains 3 Aimag consolidation External growth opportunities Gas distribution tenders 4 Focus on “sustainable” developm. Selective asset development New opportunities in WTE (FI) 5 EBITDA +5.6% Cagr Enhance Returns and credit standing “A grade” ratios 8
    • Consistent growth leveraging upon “all” drivers Next 5Y Ebitda Target +60 800 800 +104 +29 607 600 343* Capex 340 400 (m€) 200 0 2010 Syn & New M&A E2015 Org. G. plants Synergies & Organic growth New Plants M&A Market expansion in energy Biomass (Enomondo) project, Development strategy continue and waste areas (+40m€). desorption and sorting plants, to focus on core business Tariff adjustments in Networks and Bio digesters (+12m€). areas and on strengthening (+20m€). Other plants to complete the Hera presence in reference value chain (+15m€). and surrounding territories Cost to serve and cost per starting from Aimag POD reduction (15m€). consolidation.* Including Aimag capex 9
    • M&A strategy focused on “traditional core dimensions” Ebitda growth from M&A (m€)GAS TENDERS +13 SADORI: Gas supply activityTender calendar under way M&A ‟11-‟15 Active in northern part of MarcheHera aims at winning bids +60 m€ region (Pesaro & Ancona).for current concessions +30 34K gas clients.which imply coverage +17completion of catchment Ebitda ~3m€areas (~110m€ capex-RABdevelopment). Waste Energy Network s Other Other Aimag AIMAG: Territorial expansion Hera strengths Gas tenders 2% 76% 17% Coverage in territory Active in northern part of MO 4th national player province. Sadori Quality of service 5% Targeting a majority stake moving M&A ‟11-‟15 Other national players +60 m€ from current 25% (bought for 35m€ in „09). F2I 4% Edison 3% Negotiations in progress to pursue a share swap acquisition. New opportunities might come from sector conditions/reforms 10
    • Overview on Ebitda growth by strategic areasEbitda growth(m€) 18 +5.6% Cagr E2015 Ebitda 293 16 +12 +2 800 m€ +81 195 Y2010 Ebitda +98 370 119 607 m€ 289 107 Waste Energy Networks Other Waste Networks Energy Other Strategy in Waste Strategy in Networks Strategy in Energy 1. Consolidate leadership 1. Win tenders/expand gas distribution 1. Expansion and cross selling 2. Increase energy/material recovery 2. Tariffs to guarantee proper return 2. Diversify procur. mix and trading 3. Reach proper return in Urban Coll. 3. Efficiency/Innovation to enhanced return 3. Optimize cost to serve 11
    • Targets by business areas’10-’15 Ebitda growth split by business(m€) Networks Waste • Tariffs increase (avg +2% • 60% sorted collection (+12% yearly on all regulated vs 2010) and > 90% recycle/ businesses) recovery • -150 bp leakage in water nets • + 1,5 mln ton (+43%) waste • +10k km network exp. (+14%) treated (excluding Hera • +30% #POD per employee production) +193 m€ +98 • +30% District Heating • Reduction of waste disposed +81 volumes in landfills (from 25% to 18%) • + 250 GWh energy production awarded with Green Certificates +12 • Additional 9 new assets Energy • +350,000 gas clients and +240,000 electricity clients • + 0.6 bcm of Gas and +2.6 TWh of electricity sold • 7% reduction of Cost to serve • +43 MW renewable energy (installed capacity) 12
    • Business risk exposureRisk sensitivity by business 50% of Diversified Regulated Regulatory business risks Risk factors Impacts Mitigating and Authorities 2010-2015 factored in factors • Downstream • Churn gas ~ 7% • Taking care of customer base competition • Churn E.E. ~ 12% and competitive offering Strong Energy • Doubled churn rates Market Some risk factor • Supply margins • Decrease (in real terms) • Upstream balance//flexible positions have opposite impacts on portfolio activities • Green Certificates • 72 €/MWh in 2015 • Low exposure (each -10% (-14% vs. 2010) GC price equal -0.4% of Group Ebitda) Waste • Competition on • 5-8% cut of margins • Expansion of “physical” special waste on some special w. presence categories • Leverage on full service • Gas tenders/ new • tariffs impact • Asset ownership tariff period • Strong mkt share Network • Water tariff system• Increase by • ATO agreements until inflation -0.5% the end of 2012 from 2013 • Regulatory risk • n.a. Still retaining some Capex flexibility 13
    • Capital discipline and enhanced financial structure Capex plan* Returns (m€) (%) ROI 345 343 10.5% 8.5% 2010 E2015 NIC** (b€) 3.7 4,3 2012 2013 2014 2015 Energy Waste Network Other E2015 Cash flows Financial ratios (b€) FFO/Debt Debt/Ebitda +0.5 (0.34) 3.1x ~ 20% ~ 2.7x 15% 0.16 Operating Capex & Inv. Free Cash 2010 E2015 2010 E2015 Cash flows flows 14* Including Aimag capex **Net invested capital
    • Closing remarks …reliable and resilient company story ~800 m€ EBITDA (+~200 m€) with marginal risks ~340/350* m€/year of capex, down by ~78 m€/year vs past 5Y, >60% on regulated activities Free cash flow of all businesses in “positive” zone Net Debt/EBITDA to 2.7 by 2015** Confirming equity story* Including contribution from AIMAG** Accounting conversion of convertible bond 15
    • ANNEX: Business plan 2011-2015 WASTE (further details by strategic area)
    • Waste business track records Hera waste mgmt track record Financial track records (m€) Cumulated capex ’02-’10 (m€) 869 M€ 2003 2004 2005 2006 2007 2008 2009 2010 Cagr 770 Revenues 285 362 482 540 554 632 642 701 +14% 651 352 Ebitda 62 86 131 151 156 186 187 195 +18% 526 303 Ebit 21 47 64 74 82 100 92 87 +23% 253 Other 358 196 WTE 269 129 468 517 Enhanced Hera’s fully integrated asset base 77 169 99 398 50 330 (n. of plants) 22 229 19 1 170100 56 77 2003 2004 2005 2006 2007 2008 2009 2010 17 16 12 Changed business organization in 2010 10 7 2 13  Spin-off waste treatment activities/assets into a new legal entity.  Opened up share capital (25% stake) to Eiser. 0  Achieved further financial flexibility in the Holding Hera SpA. Landf ill WTE Thermal Compost ing Sort ing Chem.- Ot her Tot al phys. 16
    • Hera growth strategy and waste market expansionMarket Expansion Green certificates from Waste (m€) Focus on Expand Increasevalue added geographical “full service” treatments scope contracts 31 Hera sales volumes (kton) +6.8% Cagr 16 4,835 3,473 2,959 +13 % Cagr 1,608 1,864 +0.1% Cagr 1,876 2010 E2015 2010 E2015 Urban w. Special w. Leverage upon domestic plant shortage Identified key target MKT areas GC quantity (GWh) 181 434 Competitive commercial offers (full service) Physiological market growth GC price Match volume growth/efficient treatments (€/ MWh) 86 72 (urban w. landfill treatments down to 20%) Increase sorted collection from 45% to 54% 17
    • Waste treatment capacity and energy generation enhancementFully integrate value chain Energy production sustains growthHera Treatment capacity Renewable Power generation(k ton) (GWh) +1,447 Kton 26 7.150 +276 777 281 5.703 290 73 581.9 79% 74% 306.4 Third parties 90 Hera plants 26% 21% 212 2010 WTE La ndfi l l Compos t/ Other 3rd E2015 2010 E2015 Chi -fi pa rti es WTE Landfills Digestors Biomass & OtherNew Plants contribution to growth Leadership linked to the selective integration of asset base. +86 +276 +59 Biomass Digestors +41 (Enomondo ) +90 Ebitda contribution E2015 Digesters: +6.0 m€ Biomass: +5.5 m€ WTE Landfills Digestors Biomass Total Desorption p: +4.4 m€ Solar Selection p: +1.5 m€ & Other Other plants: +11.6 m€ Total +29.0 m€ 18
    • Waste targetsFull contribution from all new and started up plants’11-’15 Ebitda growth Cash Flow significant(m€) progression (m€) +8.5% Cagr 293 195 2010 E2015 107 ROI 8.1% 14.7%Capex plan*(m€) 7 105 99 2010 E2015 39 Development 60 Maintenance Avg capex 04-10 Avg capex 11-15*Including a portion of Hera Indirect Capex 19
    • ANNEX: Business plan 2011-2015 NETWORKS (further details by strategic area)
    • Networks track records Hera track record Hera Market share in gas distribution Networks track record (m€) Incumbent in reference territories (% of customers) Cagr.% C2004 C2005 C2006 C2007 C2008 C2009 C2010 04-10 Revenues 452.2 592.4 662.8 763.8 769.2 924.2 893.2 +12.0% 55% Ebitda 146.2 199.9 216.3 239.4 262.4 278.1 288.8 +12.0% Ferrara Total networks length (Km) +4.5% Cagr Modena Bologna Ravenna 80% 70.247 71.178 68.833 16% 59.612 60.974 71% Forlì-Cesena 98% Rimini Marche 83% C2006 C2007 C2008 C2009 C2010 Multiserviz Average local Market Share i 64%* 92% electricity net with electronic metering3 00 +58 236 92%2 00 +68 +351 00 75 Potentials to win tenders inside the 0 reference territory and in surroundings 2007 2008 2009 2010 total 20
    • Networks internal growth drivers (1)Visible and safe tariff enhancement Benefitting from new asset baseAvg. revenue per m3 of water distributed(€/m3) Hera heating production sources (GWht) +2.9% Cagr 1.93 +8.6 % Cagr 929 1.67 20% 616 16% 17% 669 2010 E2015 Efficient 14% 28% 363 thermal energy 17% productionTotal gas revenues 11% 8%(m€) 41% 28% +1.6 % Cagr 177 163 2010 E2015 Gas boilers Geotherm. Co-gen. WTE Hera CCGT 2010 E2015Total electricity revenues Hera heating production sources(m€) +0.18% Cagr  Increase volume sold to new customer 50.0 50.4 (new urbanization)  Efficient sources for heat production  Waste contribution to increase heat gen.  Increase of margins/environmental perf. 2010 E2015 21
    • Networks internal growth drivers (2)Economies of scale in networks management Gas (€/POD) -1.7% CagrAverage Cost per POD(€/POD) 49 +0.02% Cagr 45 155 156 2010 E2015 Electricity Water (€/POD) (€/POD) 2010 E2015 -0.9% Cagr +0.4% Cagr 147 140 275 270  smart metering and smart grid  workforce management  network remote control  network layout optimization 2010 E2015 2010 E2015 22
    • Networks targets Capital discipline and efficiency gains turn cash flows to positive Ebitda Capex (m€) +5.1% Cagr (m€) 370 289 217 182 2010 E2015 2010 E2015 Ebitda Capex (€/ POD) (€/ POD) 119.2 146.9 75.2 88.1 Cash Flow RAB/ NIC* (m€) (b€) 2,6 2,3 0,3 0,2 0,4 0,3 D.H. +0 0,9 E.E. 0,9 2010 E2015 Gas Water 0,9 1,0 (11) 2010 E2015 (*) = Regulated Asset Base for Gas & Water; Net Invested Capital (Fixed Asset, Working Capital less provisions) for E.E. & D.H 23
    • ANNEX: Business plan 2011-2015 ENERGY (further details by strategic area)
    • Energy track record Hera track record Financial Highlights Gas volumes sold (ml m3) Cagr.% +0.9% Cagr C2004 C2005 C2006 C2007 C2008 C2009 C2010 04-10 2,914 2,786 2,803Revenues 652,4 1.089,7 1.192,3 1.630,6 2.474,1 2.958,6 2.392,1 +24,2% 2,493 2,408 2,337Ebitda 52,9 42,7 44,7 43,0 66,1 80,8 106,9 +12,4% C2005 C2006 C2007 C2008 C2009 C2010 Electricity volumes sold (GWh) Electricity customers („000) +15.6% Cagr +16.7% Cagr 7,744 7,047 383 335 5,075 273 287 264 4,335 3,755 3,133 177 C2005 C2006 C2007 C2008 C2009 C2010 C2005 C2006 C2007 C2008 C2009 C2010 24
    • Keeping a balanced and effective energy upstream strategySales expansion Sales coverageEvolution of Hera Energy clients Hera Electricity provisioning mix (TWh)(m clients) 1.9 10.8 1.4 8.2 1.2 0.9 7.6 70% 1.1 Market 5.4 66% 0.8 0.7 Hera assets 2.8 34% 3.2 30% 0.4 0.1 2004 2010 E2015 2010 E2015 Electricity Gas  Exploit trading and procurement capabilitiesHera commercial strategy  Reach flexibility with current asset base Keep in focusing on residential and SoHo  Identify opportunities on new leading edge projects Further penetrate surrounding Regions in the M/L term Keep on leveraging on “salvaguardia” customer base (Tuscany and Umbria) Gas provisioning mix (bcm) Focus on cross selling through a multiservice offer 3.2 Provide key industrial clients trigen solutions 2.9 Domestic 1.6 50% 1.6 56% supplyHera customer satisfaction Indexes 1.6 50%(60 correspond to satisfied, 70 to delighted) Int.l supply 1.3 44%E2015  Implement innovative 2010 E2015 = 70 CRM practices  Exploit market position 2010 69  Leverage upon direct  Consolidate relationship with key player contact points to  Leverage on procurement trading capabilities 2006 67 enhance customer  Exploit capacity available on international pipelines satisfaction  Expand trading strengths  Identify infrastructure opportunities 25
    • Energy targetsGrowing results and decreasing capex turn cash flow to positiveCost to serve Ebitda growth(€/contract) (m€) +2.2% Cagr -1.6% CagrMulti-utility approach to 21.2 119exploit economies of 107scaleSales channels tailored 19.7on clients‟ segment 43Online services andelectronic invoicesOptimisation of customeroperations 2005 2010 E2015 2010 E2015 Cash FlowCapex (m€)(m€) 41 54 28 28 2010 E2015 Cash Flow per customer 27 (€) 2010 E2015 26
    • ANNEX: Business Plan 2011-2015 (by business)
    • Waste businessEconomics Capex ’11-’15: 496m€ (m€)M€ 2010 E2015 Cagr. 598 496Revenues 703.1 977.8 +6.8%Operat. costs (386.0) (512.1) +5.8% 189.8Personnel (147.2) (173.6) +3.4%Capitaliz. 25.3 0.9 (48.7%) 306.0Ebitda 195.1 293.0 +8.5% 06-10 E 11-15 M aintenance Develo pmentEbitda breakdown Highlights(m€) 293 2010 E2015 195 Tariffs (€/ton) 213.8 268.7 167 Volume treated Urban (kton) 1,864 1,876 29 Special (kton) 1,608 2,959 C2010 E2011 E2012 E2013 E2014 E2015 Hera prod. (kton) 2,230 2,316 Collection Treatment & Disposal 27
    • Water businessEconomics Capex ’11-’15: 566m€ (m€)M€ 2010 E2015 Cagr. 545 566Revenues 579,2 570,8 (0,3%)Operat. costs (344,7) (287,6) (3,6%) 232.2Personnel (105,2) (117,3) +2,2%Capitaliz. 12,8 27,3 +16,4% 333.8Ebitda 142,0 193,1 +6,3% 06-10 E 11-15 Maintenance DevelopmentVolume sold & n. of contracts Highlights 2010 E2015 2010 E2015 Leakage 26.0% 25.3%Volumes (mm3) 251 251 RAB (b€) 0.9 1.0Contracts (m) 1.18 1.24 Tariff (€/m3) 1.7 1.9 28
    • Gas businessEconomics Capex ’11-’15: 476m€ (m€)M€ 2010 E2015 Cagr. 95Revenues 1.237,1 1.593,7 +5,2%Operat. costs (1.003,3) (1.308,2) +5,5% 56 56Personnel (66,9) (75,9) +2,5%Capitaliz. 27,0 11,8 (15,2%)Ebitda 193,9 221,5 +2,7% 39 avg 09-10 avg E11-15 Maintenance DevelopmentEbitda breakdown Highlights(m€) 221,5 193,9 6,5 2010 E2015 5,8 28,5 16,7 RAB (b€) 0.9 0.9 186,5 Networks (kKm) 13.5 15.7 171,5 Tariffs (€c/m3) 6.5 6.9 C2010 E2011 E2012 E2013 E2014 E2015 Gas District H. Heat Mgmt 29
    • Electricity businessEconomics Capex ’11-’15: 182m€ (m€)M€ 2010 E2015 Cagr. 39 36Revenues 1.468,3 1.744,9 +3,5%Operat. costs (1.399,2) (1.652,6) +3,4% 24Personnel (23,8) (29,3) +4,2%Capitaliz. 14,5 11,2 (5,0%) 12Ebitda 59,8 74,2 +4,4% avg 09-10 avg E11-15 M aintenance Develo pmentEbitda breakdown Highlights(m€) 74,3 2010 E2015 59,8 6,8 E. sold (TWh) 7.7 10.1 3,3 E. distr. (TWh) 2.2 2.3 67,4 704 56,5 E. contracts (k) 383 E. tariffs (€c/KWh) 2.3 2.2 C2010 E2011 E2012 E2013 E2014 E2015 Electricity Microcogen. 30
    • Other business Economics Business Portfolio breakdown M€ 2010 E2015 Cagr. Liberalized 47% Revenues 99,4 84,5 (3,2%) Operat. costs (66,5) (48,2) (6,9%) Personnel (18,7) (18,1) (0,7%) Capitaliz. 2,3 0,0 Ebitda 16,4 18,2 +2,1% Capex ’11-’15: 47m€ (m€) 12.7 Regulated 53% 9.4 3.4 6.0 avg 09-10 avg E11-15 Maintenance Development 31
    • DisclaimerThis presentation contains forward-looking statements regarding future events (which impact the HeraGroup’s future results) that are based on current expectations, estimates and opinions of management.These forward-looking statements are subject to risks, uncertainties and events that are unpredictableand depend on circumstances that might change in future.As a result, any expectation on Group results and estimates set out in this presentation may differsignificantly depending on changes in the unpredictable circumstances on which they are based.Therefore, any forward -looking statement made by or on behalf of the Hera Group refer on the datethey are made.The Hera Group shall not undertake to update forward-looking statements to reflect any changes in theGroup’s expectations or in the events, conditions or circumstances on which any such statements arebased.Nevertheless, the Hera Group has a “profit warning policy” , in accordance with Italian laws, that shallnotify the market (under “price-sensitive” communication rules) regarding any “sensible change” thatmight occur in Group expectations on future results. 32