Utility demand in Italy decreased by 1,9% (-2% adjusted) in November, registering a further decline after last October's poor data (-1,3%). Last month's consumption was the poorest in five years and was even below 2009 crisis levels.
This is what emerges from the report made by Citigroup analysts. In 2011, however, demand in Italy increased by 1,1% thanks to the performance in the first half year. Last month imports continued to rise (+15,3%) given the high average prices in our country and the growth of renewables was also modest (+18%). Enel and Terna's 2012 Eps estimates remained substantially unchanged, respectively at 0,40 euro and 0,19 euro.
The higher-than-expected return is in fact offset by the reduction in inflation expectations in line with the new estimates by economists, who predict that inflation in Italy will drop to 2,4% in 2012, to 0,9% in 2013 and even to 0% in 2014. Terna's target price was cut from 3,10 to 2,90 euro to reflect the "destruction of value" in the short term in a context of falling inflation and high real rates. Also on Terna, Fitch placed the A+ rating of the senior unsecured debt under observation for a possible downgrade, as a consequence of the similar decision taken with regard to Italy. Finally, the 2012-2015 earnings per share estimates for Snam Rete Gas for 1,8-7 have been revised downwards by 4,30% on average and the target price has been reduced by 4% from XNUMX to XNUMX euro, given the drop in inflation and the delay in acquisitions.
