Here is the complete quarterly Enel: Net profit up more than expected, Ebitda negatively impacted by Iberia and debt up slightly as a result of the change in perimeter and the payment of the interim dividend (9 cents in January).
These are the most significant data of the accounts closed as at 31 March and approved by the Board chaired by Patrizia Grieco. Group revenues grew by 8,4% to 19,36 billion due to higher revenues from sales to end customers and exchange rate effects. Ebitda instead fell to 3,914 billion (-2,6%) while the net result rose to 983 million (+4,7%). Net ordinary income reached 943 million: this is a leap of 18,6% which benefits from lower financial costs and the lower impact of minority interests, a step desired by the CEO and general manager Francesco Starace both with the reorganization of the interests in South America and with the managed in Europe. The share proceeds at 4,564 euros (+0,04%) at 10,30 on Friday.
Sale debt that exceeds 39,2 billion (against 37,5 at the end of 2016), up by 4,6% due, on the one hand, to the acquisitions made in the period (including the Brazilian company Celg); and on the other hand the payment of the interim dividend for 2016, the effects of which – underlines the press release with which Enel announced the quarterly accounts – were partially offset by the growth in operating cash flows (+12 %).
THE REASONS FOR THE DECLINE IN EBITDA
The reduction in the margins of Endesa Iberia (-17,7%) could not but have had an impact on the group's EBITDA due, as the Enel note points out, "to the purchase of electricity on the spot market at higher prices than the sale prices and to the lower contribution of renewable sources, as well as in the retail business". The effects of the changes in the scope of consolidation also had an impact, which negatively affected the results of the Europe and North Africa business areas (following the loss of control of Slovenske Elektrarne) and North and Central America (due to the deconsolidation of EGPNA Renewable Energy Partners) ”.
“The first quarter of 2017 results recorded significant progress – the CEO Francesco Starace is keen to underline – with an increase in ordinary net income compared to the same period last year, despite a declining EBITDA”. “In Latin America, with the sole exception of Colombia, we have recorded growth in demand in all the countries where the Group operates. A further positive signal is given by the appreciation of the major South American currencies against the euro. In the quarter we also completed the acquisition of Celg Distribuição”, continues the CEO. With these premises that "confirm the validity of our efficiency plans and our efforts to increase cash flows in support of investments destined for growth", the group confirms “the year-end goals".
OPERATIONAL DATA THE ANTITRUST INVESTIGATION
Electricity sales in the first quarter of 2017 amounted to 71,3 TWh and recorded an increase of 3,3 TWh (+4,9%) compared to the same period of the previous year. Natural gas sales amounted to 4,2 billion cubic meters, with an increase (particularly concentrated in Italy in the business segment) of 0,4 billion cubic meters compared to 2016 (+10,5%). The net energy produced by Enel in the first quarter of 2017 amounted to 63,3 TWh, a decrease of 2,7 TWh compared to the same period of 2016 (-4,1%) attributable to a lower production both in Italy (-0,5 TWh) and abroad (-2,2 TWh).
The long-term goal of the Enel Group remains the decarbonisation of the mix by 2050. The group aims at produce, in 2019, more than half of its electricity globally with zero-emission sources (renewables and nuclear which today account for 43,9% against 56,1% for thermoelectric). The volumes of electricity distributed in Italy decreased by 0,2 TWh (-0,4%) compared to the value recorded in the first quarter of 2016. The electricity distributed abroad amounted to 53,2 TWh, with an increase of 3,2 TWh (+6,4%) compared to the same period of 2016.
Just on the eve of the quarterly, the Antitust has put Enel under investigation, together with Acea and A2A for anti-competitive conduct in the electricity sales market. According to the guarantor, it is a question of verifying the abuse of "possible strategies aimed, also in the perspective envisaged by the Competition Law on definitively overcoming the standard offer service at regulated prices, to move its customer base served under standard offer to the free market and made up of families and small and medium-sized enterprises”. On Thursday, the Antitrust sent its inspectors to the three companies involved, to whom Enel underlines that it has “provided its usual collaboration in inspection activities. The company trusts that the Authority's investigation will be able to ascertain the full correctness and legitimacy of the conduct object of investigation".
2017 OBJECTIVES
During 2017, in line with the plan objectives, the following are envisaged: the acceleration of investments in digitalisation, with the continuation of the installation of second generation smart meters in Italy and the installation of electronic meters in the Iberian Peninsula. It is also expected the acceleration of the roll-out of the fiber optic network undertaken by Open Fiber; the contributions of the customer focus strategy on a global scale; further advances in operational efficiency, supported by digitalisation; the contribution of industrial growth, focused on networks and renewables; the second phase of corporate simplification, carried out at the individual country level, particularly in Latin America; further advances in active portfolio management.
