Terna (TRN) H1 2024 earnings summary

Executive summary

• Achieved strong double-digit growth in all main financial indicators in H1 2024, with revenues up 18.1% and net profit up 32.4% year-over-year, reinforcing leadership in energy transition and sustainability.

• CapEx exceeded €1 billion in H1 2024, up 25.5% year-over-year, supporting major grid projects, digitalization, and decarbonization targets.

• Sustainability is integrated into the industrial plan, with recognition from rating agencies, inclusion in global ESG indices, and awards for sustainability.

• Renewable energy production surpassed fossil sources for the first time in Italy during H1 2024, with record monthly renewable coverage in May and June.

• Major infrastructure projects, including Italy-Tunisia interconnection, Tyrrhenian Link, SACOI3, Adriatic Link, and grid upgrades for Milan-Cortina 2026 Olympics, are fully authorized and progressing.

Financial highlights

• Group revenues reached €1,754.4 million in H1 2024, up 18.1% year-over-year; EBITDA rose 23.4% to €1,257.2 million; EBIT increased 30.8% to €836.1 million; net profit was €544.8 million, up 32.4%.

• CapEx hit a record €1,042.4 million, up 26% year-over-year.

• Net debt at end of June 2024 was €10,328.8 million, down from €10,494.3 million at year-end 2023.

• Operating cash flow of €931 million covered almost all CapEx spending.

• EBITDA margin improved to 71.7% in H1 2024 from 68.7% in H1 2023.

Outlook and guidance

• 2024 guidance fully confirmed, with continued focus on executing the 2024-2028 industrial plan, accelerating investment in regulated activities, digitalization, and grid resilience.

• 2024 revenue expected at €3.55 billion, EBITDA at €2.42 billion, EPS at €0.49, and capex at €2.6 billion.

• WACC for 2025-2027 expected to remain in line with the strategic plan assumption of 5.5%.

• Cost of debt for full year 2024 expected around 2.5%.

• Ongoing consultation with ARERA on WACC regulations for 2025-2027 and Totex/Output-based approach.