Financial Markets Review (March 2015)

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March 2015 Performance of the main stock indices Source: Snam on the Bloomberg data The financial markets pag. 1 The utility sector pag. 2 Snam shares and its peers pag. 3 2014 results pag. 4 The oil markets Oil prices decreased in March, both for the US crude benchmark WTI (-4.34%, closing at $47.6/barrel) as well as the Brent (-13.7%, at $53.3/barrel), which were negatively af- fected by the persistence of an abundant oil supply as well as the strengthening of the US dollar. Snam S.p.A. Investor Relations The financial markets March saw a negative trend on the US S&P500 (-1.7%) and the DJ Eurostoxx Utili- ties sector index (-2.2%), while the closure was positive for the DJ Stoxx50 European index (+1.0) and the Italian FTSE MIB (+3.7%). European markets benefited from the ECB's bond purchase program, as well as signs of economic recovery in the Euro- zone. The main US market was negatively affected by the strong appreciation of the US Dollar, as well as some lower-than-expected macroeconomic data. Data was down (in February, on a monthly basis) on orders for durable goods (-1.4%) and retail sales (- 0.6%); industrial production remained nearly unchanged (+0.1%), while the US GDP was up 2.2% (QoQ annualized) in the fourth quarter of 2014 (compared to expectations of +2.4%). In the Eurozone (March data, on a monthly basis), there was an improvement in all leading economic indicators (particularly the manufacturing PMI, at 51.9 points from 51 and the composite index at 54.1 points, from 53.3). The ECB confirmed the reference rate at its current level (0.05%). 21.8% 2.8% 14.3% 0.4% 1.0% 3.7% 2.2% 1.7% -5% 0% 5% 10% 15% 20% 25% DJ Stoxx 50 S&P 500 DJ Euro Stoxx Utilities FTSE MIB March ‘15 YtD ‘15 The Snam stock remains flat The stock markets registered contrasting trends, with European markets driven by the ECB's quantitative easing program Oil prices decreased

Transcript of Financial Markets Review (March 2015)

Page 1: Financial Markets Review (March 2015)

March 2015

Performance of the main stock indices

Source: Snam on the Bloomberg data

The financial markets pag. 1 The utility sector pag. 2

Snam shares and its peers pag. 3 2014 results pag. 4

The oil markets Oil prices decreased in March, both for the

US crude benchmark WTI (-4.34%, closing

at $47.6/barrel) as well as the Brent (-13.7%,

at $53.3/barrel), which were negatively af-

fected by the persistence of an abundant oil

supply as well as the strengthening of the

US dollar.

Snam S.p.A. Investor Relations

The financial markets

March saw a negative trend on the US

S&P500 (-1.7%) and the DJ Eurostoxx Utili-

ties sector index (-2.2%), while the closure

was positive for the DJ Stoxx50 European

index (+1.0) and the Italian FTSE MIB

(+3.7%). European markets benefited from

the ECB's bond purchase program, as well

as signs of economic recovery in the Euro-

zone. The main US market was negatively

affected by the strong appreciation of the US

Dollar, as well as some lower-than-expected

macroeconomic data. Data was down (in

February, on a monthly basis) on orders for

durable goods (-1.4%) and retail sales (-

0.6%); industrial production remained nearly

unchanged (+0.1%), while the US GDP was

up 2.2% (QoQ annualized) in the fourth

quarter of 2014 (compared to expectations

of +2.4%). In the Eurozone (March data, on

a monthly basis), there was an improvement

in all leading economic indicators

(particularly the manufacturing PMI, at 51.9

points from 51 and the composite index at

54.1 points, from 53.3). The ECB confirmed

the reference rate at its current level

(0.05%).

21.8%

2.8%

14.3%

0.4%

1.0%

3.7%

‐2.2%

‐1.7%

-5% 0% 5% 10% 15% 20% 25%

DJ Stoxx 50

S&P 500

DJ Euro Stoxx Utilities

FTSE MIB

March ‘15

YtD ‘15

The Snam stock remains flat

The stock markets registered contrasting trends, with European markets driven by the ECB's quantitative easing program

Oil prices decreased

Page 2: Financial Markets Review (March 2015)

Similar to the markets, the sectors also regi-

stered contrasting trends. The persistence of

both the ongoing weakness in crude oil pri-

ces and fears over an estimated 2015

growth worse than 2014 for the Chinese

economy (+7% compared to +7.5% the pre-

vious year) negatively affected the raw mate-

rials sector and the oil & gas sector. Howe-

ver, good corporate results achieved in 2014

and the positive data on automobile registra-

tions in Europe (+6.6% in the first two mon-

ths of the year, compared to the first two

months of 2014) drove the automotive sec-

tor.

The utility sector was on the decline, af-

fected by weak energy prices.

In March, the utility sector saw a decrease of

-2.2%, driven down both by weak energy

prices as well as the underperformance

recorded by integrated operators in Germa-

ny and France. The latter were negatively

affected by rumors regarding possible inte-

gration operations decided upon by the

French government in the nuclear sector

(EDF -9.6%).

The Utility sector in the Stock Market

Source: Snam on the Bloomberg data

Main sector performance, March 2015

Sector and subsector performance, March 2015

‐0.9%

‐2.6%

‐1.5%

‐2.2%

-5% 0% 5%

Defensive Utilities

DJ Utility

Energy Utilities

Others

The utility sector was on the decline, affected by weak energy prices

The Utility sector performance

Financial Markets Review March 2015 Snam S.p.A. Investor Relations

DJ Ut i l i t y ; -2,2%

DJ Insur ance; 4,8%

DJ T el ecom; -0,6%

DJ Heal th Car e; 3,7%

DJ M edi a; 2,7%

DJ Real Estate; -0,8%

DJ T r avel &Lei sur e; 3,8%

DJ Chemi cal s; 4,2%

DJ Food&Bev; -0,9%

DJ Const&M ater ; 1,0%

DJ Inds Good; 1,2%

DJ Oi l &Gas; -4,5%

DJ Per s&Househol ds; -1,4%

DJ Autopar ts ; 4,9%

DJ T ech; 2,0%

DJ Fi nanci al Ser vi ces; 2,2%

DJ Retai l ; 1,4%

DJ Banks; 3,7%

DJ Basi c Resour ces; 3,4%

-10% -5% 0% 5% 10%

Page 3: Financial Markets Review (March 2015)

10.2%

9.0%

1.7%

4.6%

‐5.8%

2.6%

1.9%

2.8%

21.8%

14.3%

0.0%

1.7%

‐2.9%

‐0.5%

‐2.5%

1.4%

‐1.4%

‐2.2%

3.7%

1.0%

-10% -5% 0% 5% 10% 15% 20% 25%

The Snam shares and its peers in the Stock Markets

The Snam stock closed the last session of

March at 4.52 euros, remaining unchanged

from the previous month.

The stock's performance, which outperfor-

med the utility sector, benefited from the

financial community's reception to the 2014

results and the strategic plan 2015-2018.

The announcement of the potential sale of

eni's remaining shares in Snam and profit

taking in the last week of the month brought

prices back to the previous month's level.

The stock's average daily trading volume in

March totaled 12.1 million units, down from

13.6 million in February.

Snam 2014 results

Corporate News

Snam and its peers

Source: Snam on the Bloomberg data

YtD ‘15

March ‘15

FTSE MIB

Stoxx 50

DJ Utility

United Utilities

NG

Severn Trent

REE

Enagas

Snam

Terna

On 12 March the Snam Board of Directors,

chaired by Lorenzo Bini Smaghi, met to ap-

prove the consolidated financial statements

and the draft financial statements of the pa-

rent company for 2014, showing net profit of

€1,198 million and €470 million respectively.

The Board also resolved to propose a divi-

dend of €0.25 per share to the Shareholders’

meeting.

Carlo Malacarne, Snam CEO, made the follo-

wing comments on the results:

“In 2014 we carried on with a selective invest-

ment plan designed to enhance the Group’s

growth via Capex of 1.3 billion euro and the

acquisition of TAG amounted to 0.5 billion

euro both aiming to strengthen the Italian gas

infrastructure and to promote the integration

of European networks”.

On 12 March Carlo Malacarne presented the

Strategic Plan for the period 2015-2018,

which was approved by the Company's

Board of Directors, chaired by Lorenzo Bini

Smaghi.

“For the 2015-2018 period we will invest 5.1

billion euro to support the development of

selected projects in an evolving market fra-

mework, with the aim of further contributing

to the integration of European networks and

to strengthening the security of supply”, CEO

Carlo Malacarne said.

“The solid results we expect, supported by

the increasing contribution of our foreign

subsidiaries and our strict financial discipli-

ne, allow us to confirm an attractive and

sustainable dividend policy also for 2015,

with an expected dividend of 0.25 euro”,

concluded Mr. Malacarne.

The overall investment plan in the 2015-

Financial Markets Review March 2015 Snam S.p.A. Investor Relations

Agenda

April 29 Shareholders’ meeting Financial statements at December 31, 2014. Dividend approval for 2014

Strategic Plan 2015-2018

2018 period for the Italian domestic

market amounts to 5.1 billion euro, of

which 1.3 will be spent in 2015, aimed

not only at enhancing security of sup-

ply and flexibility of the system, but

also at supporting gas flows towards

the European markets, in the broader

perspective of an effective intercon-

nection with the continental networks.

Page 4: Financial Markets Review (March 2015)

Snam and its peers: 2014 results

Operating Highlights

Financial Highlights

On 12th March Snam presented the 2014 results

1 Net of IFRIC 12 (equal to 316 million euro). The total revenue including IFRIC 12 amounted to

3,882 milion euro, up 0.9% compared to 3,848 of 2013.

2 Net profit is attributable to Snam.

On 26th March Terna presented the 2014 results

On 25th February Red Electrica presented the 2014 results

(million euro) 2013 2014 Change

Total revenue 1,758 1,847 +5%

EBITDA 1,302 1,385 +6.4%

EBIT 899 949 +5.6%

Net profit 529 718 +36%

Investments 596 956 +60%

Net debt 4,541 5,409 +19%

Financial Highlights

On 24th February Enagas presented the 2014 results

(million euro) 2013 2014 Change

Total revenue 1,262 1,224 (3.0%)

EBITDA 996 940 (5.6%)

EBIT 650 590 (9.3%)

Net profit 403 406 +0.8%

Net debt 3,773 4,059 +7.6%

Investments 531 625 +17%

Financial Highlights

Snam SpA

Piazza Santa Barbara 7 - 20097 S. Donato Milanese (Mi) Italia

www.snam.it — [email protected]

tel: +39 02 37037272- fax: +39 02 37037803

Financial Markets Review March 2015 Snam S.p.A. Investor Relations

(million euro) 2013 2014 Change

Total revenue 3,529 3,5661 +1.0%

EBITDA 2,803 2,776 (1.0%)

EBIT 2,034 1,973 (3.0%)

Net profit2 917 1,198 +30.6%

Investments 1,290 1,313 +1.8%

Net debt 13,326 13,652 +2.4%

(billion cubic meters) 2013 Change

Gas injected into the transportation

network 69.00 (9.7%)

Available storage capacity 11.4

Number of active meters (mln) 5.93 +8.1%

2014

62.28

11.4

6.41

(milioni di euro) 2013 2014 Variazione

Ricavi totali 1,896 1,996 +5.3%

Utile operativo lordo (EBITDA) 1,488 1,491 +0.2%

Utile operativo (EBIT) 1,038 1,011 (2.6%)

Utile netto 514 545 +6.0%

Debito netto 6,698 6,968 +4.0%

Investimenti tecnici 1,212 1,096 (10%)