Acceleration of the path towards zero emissions, 30% of investments dedicated to new energies by 2025, 60% by 2030, a richer coupon thanks to a strong cash generation expected at 14 billion euros.
These are some of the main points of Eni’s 2022-2025 strategic plan whose CEO, Claudio Descalzi also addressed the dramatic Ukrainian affair and the increasingly urgent need on the part of the EU to reduce dependence on Russian gas and diversify the sources of supply.
“The war in Ukraine is forcing us to see the world differently than we knew it. It is a humanitarian tragedy, which has generated new threats to energy security and which we must face without abandoning our ambitions for an energy transition. fair “, said Descalzi who reiterated that the presence of the group in Russia is” not significant “.
The company, the CEO continued, is thanks to “consolidated alliances with producing countries” committed to “finding substitute sources of energy to be used for European needs.
We are able to make over 14 TCF (trillion cubic feet) of additional gas resources available on the market in the short and medium term. ”
At work for a subject dedicated to sustainable mobility
Eni is bringing together its biorefining and marketing activities in one entity dedicated to sustainable mobility, uniquely positioned as a customer-focused multi-energy and multi-service business. Asked on this point during the conference call with analysts, Descalzi explained that “we are building the company. It will probably be completed at the end of 2022” but “it is premature to talk about IPO”.
Plenitude quotation process proceeds
Instead, the Plenitude listing process proceeds with the compilation of the registration document with the Italian Market Authority (Consob).
For the new company, the goal is to have over 2 GW of installed capacity by 2022, compared to around 1 GW in 2021, and over 6 GW at the end of the plan.
By 2025, the goal is to have over 11.5 million customers from over 10 million in 2022. A growth in charging points for electric vehicles is also expected: up to over 30,000 by the end of the plan. The pro forma EBITDA has more than doubled by the end of the plan compared to 2021, up to 1.4 billion euros.
The financial strategy
The average annual capex will be around 7 billion euros over the course of the plan with a 2022 capex of 7.7 billion. About 25% of the capex is destined to the growth of renewable capacity and the customer base, implementing circular economy projects, building incremental biorefining capacity and expanding its proposal linked to sustainable mobility.
With regard to the generation of cash, with a Brent price of $ 80 per barrel, an operating cash flow is expected to exceed € 14 billion in 2022 while the organic Free Cash Flow before working capital at replacement cost is expected to be 6-7. billions of euros in the same year.
Over the plan, based on the Eni scenario, the company will generate a cumulative operating cash flow (before working capital at replacement cost) of approximately € 55 billion and a Free Cash Flow (before working capital at replacement cost) equal to over 25 billion euros.
Increase the dividend
The Board of Directors approved an increase in the remuneration of shareholders to share with investors the generation of value deriving from Eni’s progress in its strategic path and from the improvement of the scenario.
The total annual dividend increases to € 0.88 per share from € 0.86 per share, based on the reference price of Brent between $ 80 and $ 90 per barrel.
The dividend will be paid in four equal quarterly installments in September 2022, November 2022, March 2023 and May 2023. Eni will also launch a buyback program of 1.1 billion euros, subject to the approval of the shareholders’ meeting to be held next May.
In addition, the company will update its assessment of the buyback program scenario in July and October. In the presence of Brent price scenarios above 90 dollars per barrel, Eni will proceed to increase purchases of treasury shares by an amount equal to 30% of the associated incremental Free Cash Flow. On the dividend policy “there is no pressure from the Italian government.
The Board of Directors is responsible for our dividend policy and the strategic plan is also our decision. There is no pressure or interference of any kind on the part of the Italian government “, Descalzi specified on the point when asked by an analyst.