Snam (SRG) Q2 2025 earnings summary

Executive summary

• Adjusted EBITDA rose 5.3% and adjusted net income/net profit increased 8.5% year-over-year in H1 2025, with total revenues reaching €1,906 million (+5.9%), driven by regulated revenues, associate contributions, and robust gas demand.

• Gas demand in Italy rebounded 6% year-over-year after four years of decline, with thermoelectric sector demand up 12% and LNG imports rising over 30%, now accounting for more than 30% of total gas imports.

• Strategic infrastructure projects advanced, including Adriatic Line (35% complete), new LNG terminals, and FSRU Ravenna operational, supporting energy security and supply diversification.

• Sustainability initiatives progressed: 32% of CapEx EU taxonomy-aligned, 61% SDG-aligned, sustainable finance at 86% of total, and Scope 1 & 2 emissions down 20% vs 2022.

• Major strategic transactions included the acquisition of Stogit Adriatica, sale of ADNOC Gas Pipelines stake, and agreement to acquire 24.99% of Open Grid Europe.

Financial highlights

• Adjusted EBITDA reached €1,492 million (+5.3% yoy), adjusted net income/profit €750 million (+8.5% yoy), and reported net profit €773 million (+21.9% yoy), supported by regulated revenues and associate contributions.

• Revenues grew to €1,906 million (+5.9% yoy); investments totaled €1,122 million, in line with prior year.

• Net financial debt rose to €17,580 million, mainly due to investments and dividend payments; average cost of debt stable at ~2.5%.

• Cash flow from operations was €1,118 million, with EBITDA/FFO cash conversion at 78%.

• S&P upgraded credit rating to A-; share price increased 20.2% in H1 2025.

Outlook and guidance

• Full-year 2025 guidance: EBITDA €2,850 million and adjusted net income €1,350 million, with management expecting to meet or exceed targets, supported by ARERA’s tariff RAB increase and OGE acquisition.

• Associates' full-year contribution expected at €360–365 million, assuming OGE contribution in Q4.

• Italian gas demand projected to rise further in 2025, driven by higher gas-fired power generation and civil sector consumption.

• Financing for OGE acquisition planned via asset rotation or hybrid instrument issuance.