A2A Spa Ord

Good morning. Thank you, everyone, for attending our Capital Market Day. We have a couple of busy hours in front of us. First, our CFO, Luca Moroni, will comment on nine months' results. Then, our CEO, Renato Mazzoncini, will drive you through the update of our capital and the strategic plan at 2035. So, without spending any more time, we are ready to start, and I leave the floor to Luca.

Thank you very much, Marco. I will go through the presentation of our nine-month results. Starting from the highlights, as usual. Perfect. We show a good resilience in economic and financial results despite the exceptional hydroelectric production of the previous year. The contribution of margin deriving from the growing performance of electricity network, the higher premium on the capacity market and the increase in the urban waste treatment prices absorbed the negative effect arising from lower hydroelectric production returning to historical average levels and the exit from safeguard market. Sound economic and financial performance confirmed. Reported EBITDA recorded a limited decrease, reaching 1,729 million euro. Net of impact deriving from hydroelectric production, which is one of the few exceptional effects recorded in 2024, EBITDA grew by 3%. Ordering net income, excluding a special item recorded on both 24 and 25, showed a decrease of 16%, compared nine months 24, standing at €559 million. Adjusting 24 results for the effect of last year's hydroelectric production, ordering net income decreased by 3%. We confirm the solidity of our financial ratios. Our net financial position landed at 5.3 billion, with a net financial position to EBITDA ratio equal to 2.4 times, with a decrease compared last year to 2.5. Resilient EBITDA despite normalization in hydrovolumes. Despite anomalization in adult volumes, CBTD remained resilient. Generation and trading, ordinary BDDA, amounted to 623 million, with a decrease of 20%, 160 million or less, compared to the first nine months, 24%. The change is mainly attributable to the normalization of our hydro production, minus 26%, minus one terawatt hour, resulting in a margin reduction of around 130 million. The lower opportunity from energy commodity hedging, the higher contribution of thermoelectric production, and the increase in the premium awarded on the capacity market. Supply ordinary BTDA amounted at 328 million with a decrease of 9% minus 34 million euro compared to the 9 months 24. We confirm the level of the marginality recorded in the same period of the last year, net of the effect from the safeguard market, which accounts 33 million euro. So the outcome is the positive effect of the commercial development of free market electricity segment, 109,000 customers more compared last year, plus 7%. lower retention costs, and the increase in operating costs arising from sales channel mix. Circular economy ordinary PDDA amounted to $423 million, with a growth of $20 million, plus five, compared to the first nine months, 24%. Here also the increase is mainly attributable to the positive contribution of waste to energy treatment prices, being partially offset by lower margin from the new contract with the Campania region for the management of Acera plant. The positive contribution of district heating, thanks to higher volume sold, plus 96 gigawatt, thermic gigawatt per hour, plus 5%, and higher volumes from sales of white certificates. The decrease in the collection segment, mainly following the new contract signed with Milan after the tender, slightly affected the marginality. Regulated network ordinary BTDA amounted to 359 million euro with a decrease of 29 year-on-year. Decrease in the margin is mainly attributable to the performance of the new perimeter in the electricity network, plus 68 million, as well as the increase in low revenues of a historical perimeter, plus 23 million euro, and a lower marginality deriving from the disposal of gas distribution assets. Let's see our income statement, starting from EBTDA of €1,729 million. We recorded €704 million depreciation, amortization and write-off, up to, compared last year, €45 million, €23 million for the delta perimeter of the new electricity company, Dueretti. and the new CapEx plan carried out during the period. Net provision of 69 million. Net financial expense is of 128 due to the new debt volume effect. I just recall the new issuance we had in January of the EU green bond in the new format and the bridge loan for the acquisition of the new asset from Enel Distribuzione. Taxes of €244 million with a reduction of €42 million compared to the first nine months, 24, with a tax rate of 29% in line with the previous year. Minor interest of €28 million for a net income of €559 million. including 22 million of special item mainly due to the plus value coming from the asset deal of the gas network the group net income is 581 million euro we continue to invest to growth and to support ecological transition. CAPEX, in the first nine months, amounted to €1,037 million, up 15% compared to nine months of the previous year, supporting the ecological transition. Development CAPEX amounted to €6,018 million, mainly focused on upgrading The efficiency of the grid, the increasing of flexibility of generation plants, and the development of photovoltaic and wind power plants. 70% of the CAPEX are eligible for taxonomy, and 51% are aligned. Net free cash flow. During the period, the change in our net financial position was positive and amounted to 518 million euro. Operating cash flow fully financed, capex plan and dividend payments, which is very good news. As of September 30, the company reported a net financial position of 5,317 million euro. consistent with the first alpha, reflecting an improvement of net financial position to EBITDA ratio to 2.4 times, compared to 2.5 as of the end of December 24. So in light of the solid result we have just commented, our guidance for EBITDA is confirmed in the upper end of the range, €2,170,200,000. And the group net profit, net of non-recurring items between the range of €680,700,000. Thank you very much.

OK, thank you, Luca. Good morning, everyone. Thank you for being here or connected at our Capital Market Day. Since Luca's presentation of the last quarter, you have seen the name of the plan presented last year at Lifeyards, which told the story of a company that is committed to building the future every day by investing in infrastructure, renewable energy, as Margherita. We need more power today, more efficiency and more sustainability. And data is the heart of this revolution. And data centers are spreading across our territory and are growing very quickly, you know. And today, we are ready to seize our momentum to drive the digital and ecological transition with competencies and responsibility. Just a moment, guys, because I started without moving the slide. and uh no sorry i come back no company is future proof but some company are future ready and a2a is one such company ready to face future and ready to power Today we will illustrate how E2A is writing one of the most compelling success stories in Europe's energy landscape. A story built on financial discipline, industrial excellences and strategical foresight. With a long-term vision that focuses on the two-fold opportunities of energy transition and circular economy, further accelerated by artificial intelligence development. I'll begin by giving you a brief overview. So we start with a brief overview of the energy landscape that I think can be very interesting for you. And we'll then run through the key highlights of our strategy. And then I'll hand over to Luca, who will illustrate you our key financials and how long-term financial stability underpins our growth and ensure... the platform for our acceleration into the future. So, start with the landscape. Electrification is driven by a rapid growth of data center. which we will talk about longer during the presentation, but not only, because also immobility and heat pumps are constantly decreasing in cost and entering the market, creating totally additional electrical demand. In this graph, you can see the growth of electrical demand in the next year. and in this graph clearly shows that the demand for electricity is growing while at the same time the demand for fossil energy is decreasing overall the total final consumption is decreasing because the efficiency of electrical equipment as well you know is much higher than fossil fuel equivalents, and so there is a total reduction. And therefore, electrification is also the only route to decarbonization. Decarbonization, where also more niche but fundamental technologies in complex urban contexts, such as waste-to-energy or district heating, also helps. And so, let's have a closer look of data center trend in Italy. In this map, you can see the total capacity of 55 gigawatts of connection already requested to Terna. The geographical distribution not only rewards Lombardy, which is not a surprise, but also two regions in the south, in particular Puglia and Sicily, which are located on some of the most important underwater data networks in the world. and will therefore be able to seize opportunities. So let's think of our plants in the north, but also of sites such as San Filippo del Mela in Sicily or in Puglia. Our estimated, which we presented, you remember, in September in Cernobbio with Thea, is one of the most conservative on the market in this moment. The base scenario, 2.3 gigawatts, full potential, 4.6. And the potential of heat recovery for district heating is interesting because it can double the thermal energy available. That is a particularly interesting opportunity in Milano, which sees 50% of Italian data centers on its territory and the district eating network that currently covers only less 20% of buildings. So from one side, great opportunity to grow district eating, from the other, it's recovery from data center. Investment needs in electricity distribution grid in Italy are over 10 billion euros per year, only over the horizon of our industrial plan, 35. Mainly driven by new demand, but also by the need to connect new renewable generation and renewable grid. And it's also interesting to see that WEPNIEC, that is our national integrated plan energy and climate, updated by the Meloni government in 24, has pushed the renewable energy target to a level never seen before, 63% by 2030. which, in my opinion, is the obvious reaction, after the wars, of a country that is the third in Europe for renewable potential, after Norway and France, but Italy has neither Norway's fossil fuel nor France's nuclear power. And with renewables, also storage is growing. It's interesting, the result of the first Max tender, the result is due to very low battery prices. the result of competition between Chinese players, and consequently a very low price of time shift. We have calculated about 30-35 euros for megawatt hours of the cost of time shift, which make renewable even more competitive during the day. Finally, I would like to point out that the capacity market programs launched by Terna in recent years to avoid the risk of blackouts, such as was seen in Spain, are leading to the construction of a powerful fleet of new high-efficiency gas-fired CCD plants. The efficiency is 62-63% compared with 40-50% of the efficiency for the older plants. Less CO2, lower energy price, which replaces Italian generation fleet with a power of 5 gigawatt, but more or less is equal to all the Spanish nuclear power. And what is key is that the load factor of GGTs now is around 20%. and also in the horizon of the plan without data center. That means that it is therefore more than able to cope with the increase in demand from data center. It is enough to look at the following graph to understand how our strategic decisions in recent years have permitted A2A to pave the way toward electrification in Italy. We invested 10 billion euros over the last 10 years, 60% of which focused on electrification. And our investment in electrification include the swap between part of H2A gas network with Enas power grid in province of Milano e Brescia. The result is the swap in the value of the RAB in our asset gas and power grid. Focused investment in renewable with a good mix of wind and solar to build increasingly competitive PPAs for our B2B customer. And an electricity customer base that has grown by 61% between 2020 and today. 61% the customer base electrical. HEA has currently three unique features. The first, the presence in both energy transition and circular economy space. The second, being established in Lombardy, which is the center of the development area. And the third, being ready thanks to the previous investment choices. The first of them, which really distinguishes H2A in the Italian scenario, is that it's the sole player not only vertically integrated in energy transition networks, generation and customer base, but also vertically integrated in circular economy, with strong crossover elements such as waste-to-energy and district heating. And it is an issue that we have been supporting for some time, but today a phenomenon has arrived that is focusing everyone's attention, that is the data center. A key tool of competition at the neighbor of the digital revolution, which, however, requires a systemic approach to sustainability issues. So connection to the electricity grid, supply of baseload energy but with low CO2 impact, efficient cooling system and heat recovery, and efficient water management. And Lombardy, once again, is the heart of action. We are ready. We are ready. E2A is clearly a single development partner capable of addressing all these issues in an integrated and efficient way. This is our momentum, driven by growth, new businesses and new geographies, increasing our productivity. And these are our numbers. which Luca will tell you about in more detail later. We are following the path traced in January 21, you remember, when we presented the first 10 years plan. At that time, the target seemed very challenging. But today we are surpassing most of them, despite the delays generated by COVID and worse. And today is the time of our momentum. 23 billion of investment still growing in comparison with the life-yards plan, of which 16 billion in the energy transition. And what is important, however, is this graph in which you can see the status of our investment. Of the 23 billion euros of CAPEX that will bring E2A to 3.6 billion euros of EBITDA, 35% are already completed or under construction. 35 percent already approved and ready to start this is what is needed in europe as mr draghi also reminds us in his famous report to build infrastructure that make italy and europe competitive and sustainable over time Today, the 12th of November, we have over 250 large-scale construction sites in all our sector in this moment. And I ask if it's possible to send a video, a very short video about it.