Snam accelerates investments, doubles green lines, pushes hydrogen with a new ad hoc division and cuts methane emissions by 40% by 2025. Not only that: it also positively revises the 2019 budget forecasts. This, in summary, the contents of the new industrial plan presented Thursday by the group active in the transport of gas.
In detail, for the period 2019-2023 Snam has planned to double investments in new businesses for the energy transition, which increased from 200 to 400 million.
The largest increase (from 100 to 250 million) concerns the sector of biomethane from organic waste, agricultural and agro-industrial waste, which will play a strategic role in the decarbonisation process.
Such a significant increase will be possible thanks to two acquisitions, one perfected, the other being defined. Snam acquired from Ladurner Ambiente and AB Invest 83% of Renerwaste, one of the major companies active in Italy in biogas and biomethane infrastructure, for around 46 million. Furthermore, the company has signed a binding letter of intent for the entry of 50% in Iniziative Biometano, which operates in Italy with five biogas plants.
Snam has also created a new business unit dedicated to hydrogen, with the task of evaluating possible pilot projects and contributing to the development of the supply chain. According to a study commissioned by the energy group, hydrogen could cover almost a quarter (23%) of national energy demand by 2050.
The business plan also provides a strong reduction of methane emissions: -40% by 2023.
At an accounting level, Snam aims to increase theearning per share by +5,5% at the end of the plan, against annual growth of profit higher than 4%. Confirmed the policy of dividends: +5% annually until 2022 with the coupon advance.
Resumes the plan buyback, with a new tranche of 150 million, while the average annual growth of Rab for revenues is confirmed at around 2,5%. Finally, the total investments (+14% to 6,5 billion) and Snamtec ones for innovation and green economy (+65% to over 1,4 billion).
"With the new plan to 2023, we are strengthening Snam's role in the energy transition and continuing the path of growth and shareholder remuneration by leveraging the results achieved in recent years - comments the Snam CEO, Marco Alvera – We wanted to allocate more resources to innovation and acceleration of the new green businesses of SnamTec project, equal to over 20% of total investments by 2023, to increase Snam's presence in the biomethane sector, confirm its commitment to sustainable mobility and energy efficiency and be among the pioneers in the use of hydrogen as a clean energy carrier of the future. We are convinced that hydrogen produced from renewable sources will make a decisive contribution to achieving climate objectives and that Europe and Italy can be leaders in the development of technology".
Finally, Snam has positively revised the budgetary targets for 2019: net income of €1,08 billion and earnings per share up +32% compared to 2016. It is expected that for the 2019 financial year a total dividend of €2020 per share may be distributed in 0,2376, of which 40% down payment with payment in January 2020 and the remaining 60%, on balance, in June.
For 2020, the group expects net profit to grow to around 1,1 billion and a level of debt at the end of the year of around 12,4 billion, excluding the absorption of working capital of a tariff nature expected at around 100 million. The Rab for 2020 revenues is expected to be around 20,6 billion.
