Executive Summary Capital Markets Day 2018

The continuous implementation of Enel’s key strategic pillars has allowed the Group to reach all of its critical targets since 2015 and to play a leading role in the energy transition.

In addition to meeting its targets, Enel’s results from 2015 to 2018 display a significant improvement in cash generation. This, combined with an acceleration in growth and a substantially reduced risk profile, makes an attractive increase in shareholder remuneration possible.

The new Strategic Plan 2019-2021, which was presented to the financial markets and media on 20 November 2018, consolidates the principles of the previous Plan which will be implemented in line with the evolving contexts of reference. As with the Strategic Plan 2018-2020, commitment to these key principles will create sustainable, long-term value.

Global macro trends such as decarbonisation, electrification, urbanisation and digitalisation are reshaping the world of energy. Renewables, network infrastructures and new energy services are the cornerstones of both this transformation and the sustainable, innovation-driven and customer-centric strategy of the Enel Group.

The new Strategic Plan embraces the opportunities arising from this energy transition, forecasting an acceleration of investment in renewables (taking the total capital expenditure to 11.6 billion euro) and a focus on those infrastructures essential to the transformation of the energy sector, such as grids, e-mobility and innovative customer services.

The Enel Group envisages that 62% of the energy it generates in 2021 will be emission-free, a sharp increase with respect to the 48% estimated in 2018. This is due to the rise in renewable installed capacity and to the simultaneous reduction in thermal capacity.  The Group will invest 11.1 billion euro in networks and has allocated 1.1 billion for Enel X in order to maximise value creation with regards to the trends of urbanisation and demand electrification.

With reference to the Group’s fundamental objectives, the Strategic Plan 2019-2021 outlines the following:                

  1. Industrial Growth: investments of 27.5 billion euro over the time span of the Plan, with the goal of generating an overall increase in ordinary EBITDA of 3.2 billion euro, fuelled by the full spectrum of investments in the three categories of Asset Development, Customers and Asset Management.

  2. Operational Efficiency: the goal of 1.2 billion euro in cumulated benefits deriving from improved efficiency by 2021, mainly through investment in digitalisation, has been confirmed.

  3. Simplification: Enel will continue to increase its economic interest in subsidiaries, advancing their integration into the Group and streamlining its portfolio through asset rotation, further optimising overall return and risk profile.

  4. Human Capital: the Group’s commitment to reaching the United Nations Sustainable Development Goals (SDGs) has been confirmed and extended to 2030. A “shared value” approach to communities and people is embedded in the Group’s core business processes; additional specific targets introduced to meet SDG #9 (Industry, Innovation and Infrastructure) and SDG #11 (Sustainable Cities and Communities).
     

The strength of the Strategic Plan, which is supported by the high degree of visibility of the key industrial variables, allows the Group to confirm the targets for 2018, 2019 and 2020 and to introduce new goals for 2021. This provides further confirmation of the trajectory of sustainable growth adopted by Enel.

This growth will also be reflected in shareholder remuneration: the Group will continue to apply a pay-out ratio of 70% during the entire period of the Plan, introducing for the first time a minimum guaranteed dividend for the three years from 2019-21.

The successful execution of Strategic Plans since 2015 has placed Enel at the forefront of the energy transition and enabled the Group to deliver important results for the fundamental principles of its approach.

For more information, consult the specific website.

CMD 2018 - Earnings growth