Highlights3
Total revenue in the first half of 2017 amounted to €1,268 million, up by €25 million (2.0%) compared with the adjusted pro-forma total revenue of the first half of 20164. Total revenues net of components offset in costs and total revenues for the first half of 2017 amounted to €1,214 million, up by €23 million (1.9%) mainly as a result of higher regulated revenues (+€22 million; +1.9%).
EBIT5 for the first half of 2017 totalled €714 million, up by €25 million (3.6%) compared with the adjusted pro-forma EBIT for the first half of 2016. The higher revenues (+€23 million; +1.9%), attributable mainly to the transportation segment (+€19 million; +2.1%), and the reduction in operating costs (+€18 million, net of components offset in revenues; 9.1%), which benefited from the efficiency measures launched, were partly offset by the increase in amortisation, depreciation and write-downs for the period (-€16 million; 5.2%), essentially due to the amortisation and depreciation resulting from new infrastructures coming into service.
With reference to the main operating segments6, the increase in EBIT reflects the positive performance of the transportation segment (+€21 million; +4.1%), partly offset by the reduction recorded in the storage segment (-€6 million; -3.4%), which suffered from higher amortisation, depreciation and write-downs.
Net profit for the first half of 2017 totalled €504 million, up by €77 million (18.0%) compared with the adjusted pro-forma net profit for the first half of 2016. The increase, in addition to the higher EBIT (+€25 million; +3.6%) is essentially due to the lower net financial expense (+€32 million; 21.8%), mainly attributable to the reduction in the average cost of debt, also following the benefits resulting from the improvement measures implemented in 2016 and 2017, specifically the liability management operation completed in October 2016 and the funding operations implemented in the first half of the year; and the higher income from equity investments valued using the shareholders’ equity method (+€18 million; +25.7%).
Net financial debt was €11,176 million as at 30 June 2017, compared with €11,056 million as at 31 December 2016. The net cash flow from operating activities (€1,401 million) allowed us to fully cover the financial requirements associated with net investments for the period (€608 million) and to generate a free cash flow of €793 million. Net financial debt, after paying shareholders the 2016 dividend (€718 million) and the cash flow resulting from the purchase of treasury shares (€202 million) rose by €120 million compared with the figure as at 31 December 2016.
Technical investments for the first half of 2017 totalled €425 million (€374 million in the first half of 2016) and refer essentially to the natural gas transportation segment (€378 million; €319 million in the first half of 2016) and natural gas storage segment (€42 million; €51 million in the first half of 2016).
3 Unless specified otherwise, the results for the first half of 2016 refer to continuing operations (gas transportation, regasification and storage, as well as corporate activities) and therefore exclude the contribution of the natural gas distribution segment, represented as discontinued operations, pursuant to IFRS 5 “Non-current assets held for sale and discontinued operations”.
4 See section “Financial review” for the reconciliation of the reported income statement with the adjusted pro-forma income statement for the first half of 2016.
5 EBIT was analysed by isolating only the elements that resulted in a change to that figure. To this end, applying gas segment tariff regulations generates revenue components that are offset in costs.
6 An analysis of EBIT by business segment is provided in the “Business segment operating performance” section.