• EBITDA: EUR1,274 million, an increase of about EUR80 million compared to 2023, up by approximately 6.5%.
• Net Financial Debt: Just under EUR4.1 billion, up EUR150 million from last year.
• Net Profit: EUR268 million, increased by 5% year-on-year.
• Dividend: Proposed dividend of EUR12.83, a growth of 8% compared to last year.
• Capital Expenditure: EUR830 million, decreased slightly compared to 2023.
• Net Debt-to-EBITDA Ratio: 3.2, in line with the business plan trajectory.
• Revenue from Networks Business: 28% increase in EBITDA, equivalent to plus EUR103 million.
• Investments: EUR950 million for technical investments and M&A activities.
• Customer Base: Increased by 5%, reaching a total of 2.5 million customers.
• Renewable Generation: Volumes grew by 34% due to increased rainfall and PV plant capacity.
• Energy Efficiency Projects: Decrease in contribution due to regulatory changes, impacting results negatively.
• Waste Management: 70% sorted waste collection, with urban waste managed increasing by 6%.
• Hydroelectric Production: Reached 1,457 gigawatt per hour.
• Operating Cash Flow: Positively impacted by EBITDA and release of tax credits, amounting to EUR1 billion.

• Warning! GuruFocus has detected 13 Warning Signs with FRA:TZ8.

Release Date: March 24, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Iren SpA (FRA:TZ8) reported a 6.5% growth in EBITDA, driven by contributions from networks, market business, and M&A activities.
• The company achieved a 5% net profit growth, allowing for a proposed dividend increase of 8% compared to the previous year.
• Iren SpA (FRA:TZ8) successfully expanded its waste collection services to 63 municipalities and increased its customer base by 5%.
• The company reported a significant increase in renewable energy generation, particularly hydroelectric, contributing to a 6% reduction in carbon intensity.
• Iren SpA (FRA:TZ8) maintained a stable net debt-to-EBITDA ratio of 3.2, aligning with its business plan trajectory.

Negative Points

• Net financial debt increased by EUR150 million, reaching just under EUR4.1 billion.
• The energy business faced challenges due to lower energy prices and reduced margins in district heating and thermoelectric plants.
• There was a decrease in the contribution from energy efficiency projects due to regulatory changes affecting the super bonus incentive.
• The environment sector experienced a drop in margins for some waste treatment and disposal plants.
• Capital expenditure decreased slightly compared to 2023, mainly due to the completion of environmental development plans and lower corporate investments.

Q & A Highlights

Q: Can you provide more details on the EUR500 million M&A outflow mentioned in the guidance for 2025? A: Giovanni Gazza, CFO, explained that the M&A outflow includes EUR75 million for the EGEA call option and EUR175 million of debt, along with EUR282.5 million for Iren Acqua. Smaller amounts include EUR13 million for Iren Acqua and EUR6 million for other M&A activities.

Q: What are the key drivers for the 2025 EBITDA guidance, particularly in the Generation and Market business? A: Giovanni Gazza, CFO, highlighted the increase in income from capacity markets, expected to add EUR20 million to margins, and a reduction in energy sale prices from renewables. Hydroelectric production is expected to reach 1.35 tera, slightly down from 2024's exceptional year. The market business is expected to normalize with a EUR20 million reduction in extraordinary margins from gas sales.

Q: Are there any updates on the renewal of electricity concessions and potential acquisitions? A: Luca Fabbro, Executive Chairman, stated that the first auction for the smallest hydro concession is expected by the end of 2025. Iren plans to participate and is monitoring opportunities in gas distribution and electricity grids, but will only proceed if synergies and pricing are favorable.

Q: Can you clarify the hedging strategy for 2025 and 2026? A: Giovanni Gazza, CFO, mentioned that 80% of renewable production for 2025 is hedged at EUR105 to EUR110 per megawatt. For 2026, 30% of renewable production is hedged at similar prices. Thermal production hedging is lower due to unfavorable market conditions.

Q: What is the outlook for waste-to-energy plant profitability and asset rotation plans? A: Giovanni Gazza, CFO, expects a recovery in waste-to-energy plant profitability by EUR10 million in 2025, with potential for an additional EUR10 million in 2026. Asset rotation plans, particularly for photovoltaic assets, are on hold pending regulatory clarity on battery storage, which could enhance asset value.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.