How are Enel’s accounts going (and what will Cattaneo do)
What emerges from Enel's half-year report and what CEO Flavio Cattaneo said. All the details
It was a good semester for Enel. The energy company led by Flavio Cattaneo – who assumed the position of managing director last May, replacing Francesco Starace – closed the January-June 2023 period with a net ordinary result up 52 percent on an annual basis, to 3 2 billion euros, and an ordinary Ebitda 29.4 percent higher, at 10.7 billion. However, the decline in revenues was equally sharp, -28.2 percent to 47 billion: the decrease in energy sales prices on the markets, which last year had been incredibly high, has an effect.
DEBT AND INVESTMENTS
A number in apparent contrast with the objectives of the current and past administration is that of debt, which Enel intends to reduce after a period of numerous acquisitions but which as of June 30 had risen by 3.5 percent, to 62.1 billion. The company explained that the growth is due to the payment of dividends and the investments made.
Speaking of investments, in the first half of 2023 they reached 6 billion (2.6 percent more on an annual basis) and focused on expanding energy generation from renewable sources and developing the distribution networks of the electricity: in other words, they concentrated on Enel Green Power and Enel Grids.
The growing focus on renewables is accompanied by a reduction in the impact on turnover of coal-fired generation – essential in 2022, given the gas price crisis – from 5 to 4.1 percent. Enel plans to abandon coal-fired generation by 2027 and gas-fired generation by 2040, and to bring its renewable capacity to 129 gigawatts by 2030 (today it is around 60 GW).
THE NEW CESSIONS
Yesterday Enel announced the sale of 50 percent of its Greek subsidiary Enel Green Power Hellas to the Australian financial company Macquarie Asset Management for 345 million euros. The transaction will be completed within the last portion of 2023, and therefore the debt reduction will be accounted for in the next six months.
Cattaneo explained that the sales plan reached 60 percent of the total 21 billion by 2025. "We are not rushing to sell", he declared, "but we will only sell at the right price".
THE COST EFFICIENCY PLAN
Cattaneo discussed yesterday, during a call with analysts, the new cost efficiency and optimization plan and the structure of the entire Enel group, adding that in June alone it allowed for an 8 percent reduction in operating expenses compared to the budget, as Corriere della Sera reported. The CEO complained about the complexity of the processes and the organization "which in some cases has created an ineffective allocation of capital".
In the first half of 2023, Enel's total costs are more than halved compared to June 2022 (mainly due to the lower cost of energy). But costs for services and materials also fell (from 9.9 to 8.4 billion) and personnel costs.
– Read also: Enel, all of Cattaneo's operations abroad and internal moves
THE FORECASTS FOR 2023 AND THE NEW STRATEGIC PLAN
For 2023, Enel expects ordinary EBITDA of 20.4-21 billion, net ordinary income of 6.1-6.3 billion and net financial debt of 51-52 billion.
Cattaneo has announced that the strategic plan to 2025 will be updated in November.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/energia/enel-risultati-primo-semestre-2023/ on Thu, 27 Jul 2023 08:26:25 +0000.