SNAM Annual Report 2016 - Reclassified statement of cash flows

Reclassified statement of cash flows

The reclassified statement of cash flows below summarises the legally required financial reporting format. It shows the connection between opening and closing cash and cash equivalents and the change in net financial debt during the period. The two statements are reconciled through the free cash flow, i.e. the cash surplus or deficit left over after servicing capital expenditure. The free cash flow closes either: (i) with the change in cash for the period, after adding/deducting all cash flows related to financial liabilities/assets (taking out/repaying financial receivables/payables) and equity (payment of dividends/capital injections); or (ii) with the change in net financial debt for the period, after adding/deducting the debt flows related to equity (payment of dividends/capital injections).

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Reclassified statement of cash flows (*)
(€ million)	2014	2015	2016
Net Profit – continuing operations	692	796	591
Net Profit – discontinued operations	506	442	270
Net profit	1,198	1,238	861
Adjusted for:
amortisation, depreciation and other non-monetary components	670	744	757
- Net capital losses (capital gains) on asset sales and eliminations	20	32	36
- Interest and income taxes	840	804	884
Change in working capital due to operating activities	(88)	40	(176)
Dividends, interest and income taxes collected (paid)	(1,111)	(804)	(735)
Net cash flow from operating activities	1,529	2,054	1,627
Technical investments	(1,283)	(1,186)	(1,145)
Technical disinvestments	3	6	2
Companies (entering) leaving the area of consolidation (a)	(10)	(46)	1,502
Equity investments	2	3	(168)
Change in financial credits instrumental to operating activities		(78)	(133)
Other changes relating to investment activities	56	18	22
Free cash flow	297	771	1,707
Change in financial receivables not held for operating activities	(216)	216
Financial credits for companies leaving the area of consolidation (b)			1,585
Change in short- and long-term financial debt	490	(169)	(2,297)
Equity cash flow	(505)	(875)	(978)
Effect of the change in scope of consolidation	6
Net cash flow for the period	72	(57)	17

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Change in net financial debt

(€ million)

2014

2015

2016

(*)	For the reconciliation of the reclassified statement of cash flows with the compulsory format, please see the paragraph “Reconciliation of the reclassified financial statements with the compulsory formats”.
(a)	The amount for 2016 refers to the receipt of the sum deriving from the transfer of 38.87% of the Snam S.p.A. share in Italgas Reti S.p.A. (1,502 million euro, net available liquidity transferred).
(b)	The total refers to the receipt of intercompany financial credits towards the Italgas Group net the financial debts towards BEI (424 million euro) issued by the same BEI to Snam for financing of Italgas S.p.A. projects, the object of subsequent movement of the Italgas Group. The reduction of the net financial debt thus totals 2,009 million euro.
(c)	The dividend paid in 2014 refers to the balance of the 2013 dividend (€507 million). Snam did not pay out any interim dividends in 2015 or 2016.
(d)	Includes the effects of the fair value adjustment and exchange rate of financial debts at the end of the year.

Free cash flow

297

771

1,707

Financial Debts and Credits from companies entering the area of consolidation

(112)

Financial credits for companies leaving the area of consolidation (b)

2,009

Cash flow from self-owned capital (c)

(505)

(875)

(978)

Other changes (d)

(6)

(23)

(15)

Change in net financial debt

(326)

(127)

2,723

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