In a tougher international game, Snam decides to focus further on investments in its new strategic plan to 2027 and brings them to 11,5 billion euros (net of public funding of around 900 million), above analysts' expectations. This represents a growth of 15% compared to the previous 2022-2026 plan and in the following period they will further increase up to 26 billion.
As regards the dividend policy, Snam expects a minimum annual growth of 3% to 2027, starting from the dividend due in 2024, an increase compared to the previous policy which envisaged a minimum of 2,5%. The projection on the profit at the end 2027 is approximately 1,33 billion euros.
The stock on the stock exchange is heavy, and in the late morning it was trading at 4,50 euros, down by 2,74%
Investments focused on the energy transition
- investments they are intended for strengthening transport, storage and LNG infrastructures and for transition businesses (biomethane, CCS, hydrogen and energy efficiency), explains a note. Furthermore, 58% of net investments are aligned with the Sustainable Development Goals and 37% with the European Taxonomy.
Snam also looks beyond the scope of the new strategic plan and for the following one, 2028-2032, and says that investment opportunities of up to 14,5 billion are foreseen, which are added to the total investments over the plan period expected to be 11,5, XNUMX billion, reaching one total of about 26 billion.
In the horizon of the new strategic plan, the energy infrastructure company listed on Euronext Milan expects growth in the main performance indicators while respecting financial solidity and flexibility. “In a global energy context that continues to be challenging and volatile – states the CEO Stefano Venier – we will invest 11,5 billion euros in the development of an infrastructure capable of managing a plurality of molecules in an increasingly flexible way towards the country's carbon neutrality”.
In the plan, the tariff rate is expected to be +6% from +5%, net profit +4%, Ebitda +7,4%
In detail, the company expects an average annual growth of the RAB tariff of 6%, compared to the forecast of the previous plan (2022-2026) of +5%, thanks to higher investments and the contribution of the deflator. Adjusted EBITDA is expected to grow on average by 7,4% per year and Adjusted Net Profit to grow by 4%, as an effect of the solid contribution of EBITDA partially balanced by the increase in D&A and financial charges.
In 2024 dividend of 0,2820 euros per share. 2023 net profit guidance improves
For 2023 Snam has improved the guidance on net income, equal to approximately 1,14 billion euros, compared to the previous one of at least 1,1 billion euros. Furthermore, the company expects that for the 2023 financial year it will be possible to distribute, in 2024, a dividend total equal to € 0,2820 per share, of which 40% as an advance already distributed on January 24, 2024 (with coupon detachment on January 22, 2024). The remaining 60% (to be submitted to the shareholders' meeting which will approve the 2023 financial statements) will be paid on 26 June 2024 (record date 25 June 2024 with ex-dividend date 24 June 2024).
Again in relation to 2023, Snam expects to close with investments for 2,1 billion euros, of which 1,9 billion in gas infrastructure (including 0,5 billion euros for the acquisition of BW Singapore and other investments in LNG infrastructure) and 0,2 billion for the energy transition. The 2023 tariff RAB is seen at 22,4 billion euros, the Adjusted EBITDA at approximately 2,4 billion euros, the Adjusted net profit at approximately 1,14 billion euros (compared to the previous estimate of at least 1,1, 15,5 billion euros) and net debt at XNUMX billion euros.
For 2024 Adjusted net profit of approximately 1,18 billion
For 2024, the following are expected: investments of 2,9 billion euros (of which 2,7 billion in gas infrastructure and 0,2 billion for the energy transition), tariff RAB of 23,8 billion euros, Adjusted EBITDA of approximately 2,7 .1,18 billion euros, Adjusted net profit of approximately 17,6 billion euros and net debt of approximately XNUMX billion euros.
Ravenna Hub will become the largest CCS project. Partnership with Heidelberg in sight
Among Snam's projects there is in particular the Ravenna area, in which the company intends to invest funds and strengthen with a new partnership. Responding to analysts' questions after the release of the Strategic Plan, Venier underlined that theRavenna hub is on track to become “the first and biggest project of Carbon Capture and Storage (CCS) in the Mediterranean", so much so that "the new plan earmarks the development of the infrastructure for the transport and storage of CO2 approximately 350 million euros of investments (net of grants)”.
In December 2022 Snam had signed an agreement with Eni to launch the first CCS project in Italy which in its phase 1, starting in the next few months, involves the capture of CO2 from the Eni plant in Casalborsetti (Ravenna) and the injection into an exhausted field in the Adriatic Sea. Also thanks to the development of phase 2, open to industrial emitting entities, the Ravenna CCS project is destined to become the most important in the Mediterranean, with deposits with a total capacity of 500 million tonnes. Venier today explained that the project is "suitable for a hub model", as well as a "progressive and modular development model". "In the 2024 there will be the phase of start-up, with the release of 25 ktons/y – explained the CEO – Nel 2026 the industrial phase will begin (4 million tonnes/year), to support the decarbonisation of the hard to abate industries of Northern Italy, with the option to receive additional volumes by ship from the Mediterranean". From the 2030 there will be the second industrial phase (up to 16 million tons/year)”.
“The cement industry will be a central counterpart in this project – said CEO Stefano Venier – In this regard, a partnership with Heidelberg“. Heidelberg Materials has inherited the legacy of historic brands such as Italcementi and Calcestruzzi in Italy. “Other important sectors will be the waste to energy andthe petrochemical industry. For the latter, it is important to remember that they are there four large sites in Northern Italy, that is, in Ravenna, Ferrara, Mantua, Venice", recalled Venier, answering the analysts' questions. “Another sector will be that of steel, and here we have a big player in the Brescia area,” he added. Furthermore, according to Venier, “we must not forget the power generation sector. According to the EU, power generation should not be included in industries benefiting from CCS, but I believe we should include them.”
Pass: “No concrete M&A is included in the plan”
Partnerships yes, but not acquisitions, as Venier had hypothesized last November, on the occasion of the third quarter data, when he said that "M&A is not at a standstill" and that the company was monitoring some opportunities, citing Adriatic in particular LNG and Edison. But the Chief Financial Officer today gave up on these hypotheses. Luca Passa in fact he told the financial community that the company maintains "strategic flexibility", underlining that "no concrete M&A is included in the plan."
Europe “has changed its gas mix”. Russian gas fell from 45% to 14%, US LNG rose from 6 to 20%
Then speaking more generally about global market, Venier underlined how the panorama has naturally changed a lot and how new investment strategies and all the technologies available are necessary. 2022 was a “tuning point” for the European energy market, with the war which highlighted the under-investments in the sector" said Venier in this regard, answering analysts' questions. Now the energy crisis has eased, but the system remains fragile and unstable from a macroeconomic point of view. It is therefore more important than ever invest to strengthen the supply of energy, with a focus on of your digital ecosystem.
of supply e diversification".
“To achieve climate objectives they are necessary all technologies“, claimed Venier, explaining that “the biomethane is a viable option, the CCS is gaining momentum, while the production of hydrogen it is in its infancy with infrastructure as the key enabler.” With the energy crisis, Europe “has completely changed its gas mix“, with the exit from Russia – the so-called Ruxit – which “has been compensated by LNG arriving from abroad, but this leads to a greater dependence of Europe on the LNG market and greater exposure to the dynamics of the global market”.
" share of Russian gas in EU imports fell from 45% to 14% between 2021 and 2023” specified the CEO. In detail, the share of Norway and the United Kingdom went from 26 to 34%, while as regards North Africa it went from 13% in 2021 to 15% in 2023. The share of liquefied natural gas (LNG) give it USA, rose from 6 to 20% and that from other locations, including Australia, rose from 11 to 17%.
Gas demand fell by 7%, recovering in the short term
as to gas demand, the EU has registered a decrease of 7% about 360 to 335 billion cubic meters, which should be partly recovered in the short term between 1025 and 1027, thanks to industrial recovery and coal-to-gas in energy production, with an uncertain medium-term demand outlook. “Now it is complex to make forecasts on gas demand, also because we have different scenarios depending on the increase in global temperatures by 2100. We have a significant difference between the various scenarios and therefore we must regain flexibility in infrastructure, i.e. have spare capacity in transport, storage, contracting, while now we are operating at 100% capacity ” Venier said again. “We have years ahead where the global LNG market will be tight and we will need flexibility, so we need to redesign the infrastructure with this in mind.”
