Terna SpA (TERRF) Q1 2025 Earnings Call Highlights: Strong Revenue Growth and Strategic ...

In This Article:

  • Revenue: Increased by 5.1% to EUR 902 million, up by EUR 44 million from last year.

  • EBITDA: Reached EUR 652 million, a 3.8% increase from the previous year.

  • Net Income: EUR 275 million, up 3% compared to the same period last year.

  • CapEx: EUR 562 million, a 16.4% increase from the previous year.

  • Net Debt: Stood at EUR 11.1 billion, slightly lower than the 2024 year-end level of EUR 11.2 billion.

  • Operating Cash Flow: Generated EUR 483 million, covering about 86% of CapEx spending.

  • Regulated Revenues: EUR 755 million, up 3.4% from the previous year.

  • Nonregulated and International Revenues: EUR 147 million, a 14.5% increase from last year.

  • Operating Costs: EUR 250 million, 8.5% higher than last year.

  • Net Financial Expenses: EUR 39 million, a slight increase of EUR 2.3 million from last year.

  • Tax Rate: 30.1%, compared to 29.2% in the first quarter of 2024.

Release Date: May 15, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Terna SpA (TERRF) presented an updated 2024-2028 industrial plan with increased investments totaling EUR 17.7 billion, highlighting its role in driving Italy's energy transition.

  • The company achieved a historical record level of regulated investments, planning to invest EUR 16.6 billion over five years to modernize the national electricity transmission grid.

  • Terna SpA (TERRF) completed significant infrastructure projects, including the laying of the first submarine cable of the Tyrrhenian Link, enhancing Italy's power infrastructure.

  • The company issued a EUR 750 million green bond and signed an ESG-linked revolving credit facility for EUR 1.8 billion, reinforcing its commitment to sustainability.

  • Group revenues and EBITDA increased by 5% and 4% respectively, with a group net income rise of 3% compared to the same period last year, demonstrating solid financial performance.

Negative Points

  • Renewable sources covered only 33% of national demand in Q1 2025, a decrease from the previous year due to unfavorable weather conditions affecting wind and hydroelectric production.

  • Total operating costs increased by 8.5% year-on-year, driven by higher service costs and raw material expenses in nonregulated activities.

  • The company's net debt remained high at EUR 11.1 billion, although slightly lower than the previous year-end.

  • The transition to the new Italian harmonized index of consumer prices (IPCA Italy) for RAB indexation may introduce uncertainties in future financial planning.

  • The company faces potential supply chain challenges due to US tariffs, which could lead to shortages and bottlenecks in procurement.