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Great performance in line with the market’s expectations. Earnings growth was driven by the growth in the RAB and the July commissioning of the new Piombino Floating Storage Regasification Unit (FSRU), an operating floating LNG import terminal approved in Q3 22.
Companies: Snam (SRG:BIT)Snam S.p.A. (SRG:MIL)
AlphaValue
Revenues increased in 1H23 on the back of a higher Regulated Asset Base for 2023 at €22.4bn vs €21.4bn in 2022. This higher RAB generated an additional contribution of €37m, whilst an increase in volumes regasified contributed €20m, offsetting a y €11m decline in volumes of transported gas.
Snam benefited from a higher Regulated Asset Base (RAB) and +100% growth in the energy efficiency business resulting in a strong 12.9% growth for the top line. However, EBITDA remained almost stable with a modest 1.5% growth as the group had to sell gas inventory excesses accumulated at higher prices in the past quarters. The guidance was confirmed for 2023 with an EBITDA target of €2.4bn and a €70m contribution from the Energy Transition business.
Despite the solid 11.1% growth in revenues to €3.32bn, Snam’s results were negatively impacted to the tune of €130m owing to a reduction in the WAC, combined with a rise in utility costs that weighed on earnings amidst an unprecedented volatile energy market environment. The group intends to leverage a higher contribution from the unregulated businesses, through the energy transition activities, to boost its growth.
As part of its 2022-26 strategic plan, SNAM focused on three pillars around supply security, sustainability and affordability. The Italian group aims to allocate a large proportion of its €10bn investment plan to gas infrastructures, through Floating Storage and Regasification Units (FSRUs) and pipelines to optimize storage and network systems, but also to clean energy sources, hydrogen and biomethane. However, there are reasons to remain sceptical about the group’s strategy, due to a lower-than
Snam delivered a solid performance, enabling the group to confirm its FY202 guidance, with 10.3% growth in revenues to €2.4bn. The reported EBITDA for the 9M2022 period declined by 0.6% to €1.716bn, mainly due to the reduction in WACC amounting to €95m, of which €76m concerning transport. Over the 9M2022 period, the decrease in regulated revenues was again offset by the revenues of the non-regulated activities as well as the energy transition business segment.
Research Tree provides access to ongoing research coverage, media content and regulatory news on Snam. We currently have 16 research reports from 2 professional analysts.
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