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Enel Revenues and Ordinary Net Income Excluding One-Off Items up in 9M 2017

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Enel Revenues and Ordinary Net Income Excluding One-Off Items up in 9M 2017 Media Relations Investor Relations T +39 06 8305 5699 T +39 06 8305 7975 F +39 06 8305 3771 F +39 06 8305 7940 [email protected] [email protected] enel.com enel.com ENEL REVENUES AND ORDINARY NET INCOME EXCLUDING ONE-OFF ITEMS UP IN 9M 2017 Revenues: 54,188 million euros (51,459 million euros in 9M 2016, +5.3%) Increasing thanks to greater revenues from the sale of electricity to end users and the transport of electricity, from more electricity trading and fuel sales, only partly offset by the impact of changes in the scope of consolidation EBITDA: 11,450 million euros (12,010 million euros in 9M 2016, -4.7%) Decreasing owing to a decline in margins in Iberia, which more than offset the strong performance in Italy, especially in retail, and positive exchange rate developments Ordinary EBITDA: 11,306 million euros (11,896 million euros in 9M 2016, -5.0%) net of extraordinary items relating to disposals Net of one-off items, ordinary EBITDA declined by 2.6% on a like-for-like basis EBIT: 7,217 million euros (7,689 million euros in 9M 2016, -6.1%) Reflects the decrease in EBITDA, partly offset by lower amortisation and impairment Group net income: 2,621 million euros (2,757 million euros in 9M 2016, -4.9%) The decline reflected the decrease in EBIT, only partly offset by the good performance of companies accounted for using the equity method, the reduction in the tax liability and a decline in net financial expenses Group net ordinary income: 2,583 million euros (2,700 million euros in 9M 2016, -4.3%) Net of one-off items, Group net ordinary income increased by 3% on a like-for-like basis Net financial debt: 37,941 million euros (37,553 million euros at the end of 2016, +1.0%) The increase reflects acquisitions such as Celg-D and EnerNOC as well as investments in the period, and the payment of the interim dividend and related balance dividend for 2016, partly offset by an increase in operating cash flows and by exchange rate developments Interim dividend for 2017 of 0.105 euros per share approved, payment from January 24th, 2018, up 16.7% on the interim dividend paid in January 2017 The Enel Board of Directors confirms the interim dividend policy envisaged in the Strategic Plan 2017-2019 Foreseen for 2017 an overall dividend per share of 0.23 euros, equivalent to 65% of Group net ordinary income expected for 2017 1 Enel SpA – Registered Office: 00198 Rome – Italy - Viale Regina Margherita 137 – Companies Register of Rome and Tax I.D. 00811720580 - R.E.A. 756032 – VAT Code 00934061003 – Stock Capital Euro 10,166,679,946 fully paid-in as of April 1st, 2016 Francesco Starace, Chief Executive Officer and General Manager of Enel, said: “In the first nine months of 2017, our geographical diversification and the contribution of investments in growth have enabled us to manage the ongoing global shortage of hydro and wind resources and the continuing challenges of conditions in the Iberian peninsula. We achieved an increase in revenues mainly as a result of our performance in the sale and transport of electricity, an improvement in the Group’s cash generation and an increase of 3% in ordinary net income net of one-off items. For the remainder of 2017, we will continue the acceleration of investment in digitisation, in line with which we have already installed more than a million new generation smart meters in Italy and will complete the installation of digital meters in Spain. Our growth in renewables will be boosted even further with the intensification of our BSO strategy, which has now been expanded to new countries like Mexico. In view of the progress achieved for each of the Plan objectives, the results posted in the first nine months of the year and forecast developments in the last quarter, we can confirm our performance and financial targets for 2017.” ***** Rome, November 9th, 2017 – The Board of Directors of Enel S.p.A. (“Enel”), chaired by Patrizia Grieco, has examined and approved yesterday afternoon the Interim Financial Report at September 30th, 2017. The Board of Directors has also examined and approved Enel’s financial statements on the same date and the report that indicates that the company’s financial position and performance permit the distribution of an interim dividend for 2017 of 0.105 euros per share, which will be paid as from January 24th, 2018. 1) Consolidated financial highlights for the first nine months of 2017 REVENUES The following table provides a breakdown of revenues by business area: Revenues (millions of euros) 9M 2017 9M 2016 Change Italy 27,780 26,335 5.5% Iberia 14,701 14,048 4.6% Latin America 9,830 7,923 24.1% Europe and North Africa 1,750 3,075 -43.1% North and Central America 608 672 -9.5% Sub-Saharan Africa and Asia 72 18 - Other, eliminations and (553) (612) 9.6% adjustments TOTAL 54,188 51,459 5.3% 2 Revenues in the first nine months of 2017 amounted to 54,188 million euros, an increase of 2,729 million euros (+5.3%) compared with the same period of 2016, largely due to higher revenues from: - the sale of electricity to end users and the transport of electricity; - electricity trading activities and fuel sales. These factors were only partly offset by: - a decrease in sales on the wholesale market; - the net impact of changes in the scope of consolidation for 421 million euros, attributable to the effects of the sale of Slovenské elektrárne A.S. (“Slovenské elektrárne”) equal to 1,236 million euros and of the deconsolidation of EGPNA REP equal to 235 million euros, net of the effects of the acquisition of Brazilian distribution company Celg Distribuição S.A. (“Celg-D”) equal to 963 million euros and of EnerNOC Inc. for 87 million euros. Revenues in the first nine months of 2017 include, as the only extraordinary item, the capital gain on the disposal of the Group’s stake in Chilean company Electrogas, equal to 144 million euros. Revenues in the first nine months of 2016 included, as extraordinary items, the capital gains on the disposals of the Group’s stakes in Chilean company GNL Quintero S.A. and in the Italian company Hydro Dolomiti Enel Srl, equal to 171 million euros and 124 million euros respectively. EBITDA The following table provides a breakdown of EBITDA by business area: EBITDA (millions of euros) 9M 2017 9M 2016 Change Italy 5,238 5,445 -3.8% Iberia 2,543 2,970 -14.4% Latin America 3,117 2,612 19.3% Europe and North Africa 409 609 -32.8% North and Central America 326 470 -30.6% Sub-Saharan Africa and Asia 47 7 - Other (230) (103) - TOTAL 11,450 12,010 -4.7% EBITDA in the first nine months of 2017, equal to 11,450 million euros, declined by 560 million euros compared with the same period of 2016. The change reflected the decline in margins in the Iberian Peninsula, mainly as a result of the impact of drought on the generation margin and on provisioning costs for commodities. These factors were only partly offset by: - a 147 million euro positive effect from exchange rate developments; 3 - the strong performance posted in Italy, especially in the retail market. ORDINARY EBITDA The following table provides a breakdown of ordinary EBITDA by business area: Ordinary EBITDA (millions of euros) 9M 2017 9M 2016 Change Italy 5,238 5,321 -1.6% Iberia 2,543 2,970 -14.4% Latin America 2,973 2,622 13.4% Europe and North Africa 409 609 -32.8% North and Central America 326 470 -30.6% Sub-Saharan Africa and Asia 47 7 - Other (230) (103) - TOTAL 11,306 11,896 -5.0% Ordinary EBITDA in the first nine months of 2017 amounted to 11,306 million euros, a decrease of 590 million euros (-5.0%) compared with the same period of 2016. The only extraordinary item in the first nine months of 2017, not included in ordinary EBITDA, amounted to 144 million euros and include the capital gain posted in Chile on the disposal of the Group’s stake in Electrogas. In the same period of 2016, extraordinary items amounted to 114 million euros and are the same as those noted under revenues, partly offset by capital losses in Chile and Peru on the abandonment of the development of hydro projects (about 181 million euros). Net of the one-off items discussed below, ordinary EBITDA in the first nine months of 2017 amounted to 11,195 million euros, compared with 11,497 million euros in the same period of 2016, a decrease of 302 million euros (-2.6%). One-off items in the first nine months of 2017 amounted to 111 million euros and included: in the Iberian Peninsula, a number of adjustments of non-mainland remuneration and receipt of a reimbursement of costs for the “bono social” for a number of previous financial years totalling 194 million euros; and in Latin America, a number of provisions recognised by Celg-D following its acquisition and the recognition of a number of prior-period fines levied in Argentina, with a total positive impact of 83 million euros. In the first nine months of 2016 one-off items were 399 million euros and refer to: in Italy, income from the renegotiation of gas contracts worth 311 million euros; in the Iberian Peninsula, the reimbursement of the environmental tax in the region of Extremadura, the reversal of provisions and the capital gain on the disposal of the reinsurance company Compostilla RE for a total of 125 million euros; and other minor one- off items totalling -37 million euros.
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