Iren (IRE) Investor Day 2024 summary

Strategic direction and capital allocation

• Updated 2030 plan emphasizes financial discipline, resilience, and disciplined growth, optimizing the investment portfolio and seizing new opportunities, including the EGEA acquisition.

• Capital allocation shifts toward regulated businesses, with 80% of €8.2bn investments (2024–2030) in networks, environment, district heating, and renewables under FER X or PPAs, and 94% of capex for organic projects.

• Inorganic investments are reduced and focused on completed or advanced deals, notably Egea and Sienambiente, with organic investments prioritized and 85% of planned projects already identified.

• Three pillars guide the plan: ecological transition (decarbonization, material/energy recovery, water), local value creation, and service quality, with a selective approach to profitability and financial discipline.

• Investments are front-loaded, with flexibility to adjust €600m of projects (2025–2027) if new opportunities arise.

Financial guidance and targets

• EBITDA targeted at €1.8bn by 2030 (6% CAGR), with net profit expected to grow 7% annually to over €400m, and EBITDA from regulated activities rising from 70% to 80%.

• NFP/EBITDA ratio to decline to 2.7x by 2030, maintaining a ceiling of 3.5x to preserve current credit ratings and support a strong BBB rating.

• Dividend policy extended to 2027: annual dividend to grow by at least 8% or 60% payout of ordinary net profit, whichever is higher, ensuring a floor.

• Asset rotation of €800m planned, with €250–300m expected by 2027 to support financial sustainability, while equity disposals are minimized.

• CapEx reduced from €9.1bn to €8.2bn versus prior plan, mainly by halving inorganic investments and maintaining a low average cost of debt (<2.4%).

Business unit action plans and operational focus

• Networks: €2.8bn investment, 60% RAB growth, focus on water loss reduction (to 20% by 2030), network upgrades, and new substations, with EGEA consolidation.

• Waste: €1.6bn investment, expansion from 3.8m to 5.5m users, focus on energy recovery (new WtE plants), and EBITDA growth of 80% (9% CAGR), with expansion through tenders and new treatment plants.

• Energy: €2.5bn investment, 1.2GW new renewables (mainly PV), hydro repowering, and district heating expansion; EBITDA to reach €440m (7% CAGR), with decarbonization and energy efficiency focus.

• Market: €700m investment, customer base to grow from 2.2m to 2.6m by 2030, focus on bundled services, digital/physical channel expansion, and 3% EBITDA CAGR.

• Synergies and efficiencies: €130m targeted by 2030, with €70m achievable by 2027, driven by rationalization, cost reduction, digitization, and a 7% reduction in operational costs.