The Board of Directors approves the consolidated financial statements and the draft financial statements at 31/12/2022
The 2022-2026 Strategic Plan and ESG Plan have been updated
The report on corporate governance and ownership has been approved
The Consolidated Non-Financial Statement has been approved
A dividend of EUR 1 per share has been proposed

 

Year 2022
Adjusted consolidated EBITDA 1 : EUR 537 million, EUR 399 million in 2021 adjusted 2
Adjusted net profit (loss) from continuing operations: EUR 216 million, EUR 127 million in 2021 adjusted

Fourth quarter 2022
Adjusted consolidated EBITDA: EUR 126 million, EUR 145 million in the fourth quarter of 2021 adjusted
Adjusted Group net profit: EUR 43 million, EUR 60 million in the fourth quarter of 2021 adjusted

Update of the 2022-2026 Plan
Confirmed growth of 2.2 GW in the RES portfolio, to reach 4.6 GW in 2026 and 5 GW in 2027, capital expenditure of EUR 3.5 billion and an EBITDA in 2026 of more than EUR 650 million. Dividend at EUR 1 per share sustainable over the Plan period

Strong growth in the RES portfolio from 2021 to date – The Group's installed capacity in wind and solar has grown by 927 MW from the beginning of 2021 to date (+526 MW in 2022), confirming ERG's execution capacity, both in M&A, which has contributed 60% approximately and in organic development with 40% approximately. ERG Group has now a presence in 9 European countries and has reached a total installed capacity of over 3 GW in wind and solar energy.

2022 Results – EBITDA at EUR 537 million, up by 35% as a result of the increase of 526 MW in installed capacity during the year, thanks to the contribution of the 228 MW of new wind capacity that gradually entered into operation abroad and to M&A transactions in the period for 298 MW, as well as the full contribution of plants commissioned or acquired in 2021. Net profit increased considerably in view of the better operating results and lower financial expense.

Clawback measures and windfall taxes – Urgent and temporary measures were introduced to contain the effects of price increases in the electricity sector in Italy and abroad, not included in the EBITDA as special items 3, which had a total impact of approximately EUR 91 million gross for the Group, of which approximately EUR 63 million in Italy alone.

Increase in capital expenditure – In 2022, ERG invested EUR 946 million, demonstrating the Group's strong commitment to growing its RES portfolio both in Italy and abroad. Investments were made 25% in solar and the remining in wind assets.

2023 Guidance: For 2023, EBITDA, net of clawback measures, is estimated in the range between EUR 500 and EUR 550 million, up from 2022 (EUR 502 million net of clawback), and investments are expected to be in the range of EUR 400-500 million. The financial structure is strengthened, with net financial indebtedness expected to be in the range between EUR 1,300 million and EUR 1,400 million (EUR 1,432 million at the end of 2022), including the distribution of the ordinary dividend of EUR 1 per share.

Update of the 2022-2026 ESG plan – ERG's sustainable strategy, increasingly at the heart of its business model, has been rewarded through upgrades and confirmations in the main international ratings, where ERG is confirmed in the Top Tier. The Consolidated Non-Financial Statement has been approved and the Executive Summary including our approach to Sustainability has been published. The ESG strategy is confirmed with even more challenging goals to continue the path towards a “Just Transition”.

Update of the 2022-2026 industrial plan – In light of the changed scenario characterized by high prices and volatility, the Board of Directors of ERG has approved an update of the plan targets up to 2026, confirming the strategic guidelines of the 2022-2026 plan. The 4.6 GW target of installed capacity in 2026, which may become 5 GW in 2027, has been confirmed. Expected EBITDA of over EUR 650 million in 2026, 85-90% of a quasi-regulated nature. Capital expenditure in the 2022-2026 period are expected to be around EUR 3.5 billion, of which EUR 946 million has already been invested in 2022.

Asset Rotation: asset rotation strategy to become a pure renewable player confirmed, through the relaunch of the sale of the thermoelectric business.

Financial Strategy: Net financial indebtedness forecast at EUR 2.3 billion in 2026 and maintenance of a solid and sustainable financial structure consistent with the Investment Grade rating and a NFP/EBITDA ratio of up to 4 times over the period of the plan.

Dividend Policy: annual dividend increased to EUR 1 per share, sustainable over the period of the plan.

 

Genoa, 15 March 2023 – The Board of Directors of ERG S.p.A. approved the update of the 2022-2026 Industrial Plan and ESG Plan, the 2022 financial statement, the report on corporate governance and ownership, the consolidated non-financial statement and the report on remuneration policy and compensation paid.

Adjusted consolidated financial results

IV  Quarter

Key economic data (EUR million)

Year

2022

2021

% change

2022

2021

% change

126

145

-13%

EBITDA

537

399

35%

64

92

-31%

Operating profit (EBIT)

308

198

56%

43

60

-29%

Profit (loss) from continuing operations

216

127

71%

 

31/12/2022

31/12/2021

Change

Net financial indebtedness continuing operations (EUR million)

1,434

2,051

617

Leverage 4

41%

57%

 

1 In order to facilitate an understanding of the operating segments’ performance, the operating results are shown with the exclusion of significant special income components of an extraordinary nature (special items): these results are indicated with the term “adjusted”. A definition of the indicators and the reconciliation of the amounts involved are provided in the “Financial Statements and Alternative Performance Indicators” section of this document.
2 Note that the comparison of the results of financial year 2022 with those of the corresponding period of 2021 is significantly affected by the considerable transformation of the Group's portfolio. Therefore, in order to facilitate the understanding of the performance of the two periods and in consideration of the new pure “Wind & Solar” model, the adjusted 2021 comparative figures have been restated indicating in the line “Profit (loss) from assets held for sale” the contribution of the hydroelectric and thermoelectric business, in application of IFRS 5. A definition of the indicators and the reconciliation of the amounts involved are provided in the “Financial Statements and Alternative Performance Indicators” section of this document.
3 Significant income components of an unusual nature.
4 Ratio of total net financial indebtedness (including project financing) to net invested capital.  
 
 

Paolo Merli, Chief Executive Officer of ERG commented: “We are very satisfied with the performance registered in 2022, which took place in a high price volatility scenario affected by pressure on the supply chain and extraordinary regulatory measures. The Group has once again demonstrated its industrial and financial resilience with strongly increased operational results, driven by increased installed capacity, and with a solid financial structure, despite significant investments, ready to support future growth.
In this context of international crisis and extreme volatility ERG, with over 3 GW of installed RES capacity to date and a solid wind and solar pipeline of almost 4 GW is even more determined to play a leading role in the energy transition and in the fight against climate change. We confirm the target of reaching 4.6 GW of installed capacity by 2026 with an expected EBITDA of over EUR 650 million. Challenging but visible targets, with many projects in advanced stages of development or under construction”.

The Board of Directors proposes to the Shareholders' Meeting, which will be convened for 26 April 2023 on first call and, if necessary, for 27 April 2023 on second call, the distribution of a dividend equal to EUR 1 per share which will be paid as from 24 May 2023 (payment date), with an ex-dividend date as from 22 May 2023 (ex date) and record date of 23 May 2023.

The Company has decided to make use of the option introduced by Italian Decree Law no. 18 of 17 March 2020 containing “Measures to strengthen the National Health Service and economic support for families, workers and businesses connected to the COVID-19 epidemiological emergency” (converted, with amendments, by Italian Law no. 27 of 24 April 2020, and most recently extended by Article 3, paragraph 10-undecies, of Italian Decree Law no. 198 of 29 December 2022, converted, with amendments, by Italian Law no. 14 of 24 February 2023), providing that (i) the Shareholders may attend the Shareholders' Meeting exclusively through the Designated Representative; (ii) the management and control bodies of the Company, as well as the Designated Representative, may participate in the Shareholders' Meeting by means of telecommunication which guarantee the identification of the participants, their participation and the exercise of the right to vote, without in any case the need for the Chairman and the secretary taking the minutes to be in the same place.