Company profile
Fast forward
Lugano - September 19th , 2014
Reliability • Fairness • Clarity
Power&Gas • Renewables • Engineering
Section
1.
2.
3.
4.
About Gala
Market scenario
Financial Highlights
Strategy
3
9
13
19
1
About Gala
•
•
•
•
•
Gala at a glance
Group Activities
Successful Track record
History
Shareholders and Group Structure
Gala at a Glance
Italian Leader independent in the supply of electricity with a distinctive positioning on the market
and a leading role in the consolidation process in the sector
Primary operator in an
attractive market
 Market Share on the liberalized marked of more than 3% in 2012
 Market Share on the electricity market of more than 2% in 2012
 Rapid penetration of retail segment: 25,000 new contracts in 2013; about 5,000 new
contracts each month during the first quarter of 2014
1Q14 Results (GALA S.p.A.)
 Turnover: € 291.0 MM (+6.12% vs 1Q2013)
 EBITDA: € 21.7 MM (+37.9% vs 1Q2013); EBITDA margin 7.4%
 Profit before tax: € 20.1 MM
FY13 Results (GALA S.p.A.)





Successful track record with
big customers
 Italian Group leader on suppliers to Public Administrations and Public Companies
 Supplier of large private groups and enterprises (Autostrade per l’Italia, Gucci,
Cofely Italia, Brioni, San Raffaele S.p.A healthcare, etc)
A winning Business Model
 High visibility on customer portfolio
 Focus on supply and modulation activities (Midstream) and sales activities
(Downstream)
 Methodologies e Proprietary models for analysis and optimization of risk
management and profitability
Reliability • Fairness • Clarity
Turnover: € 1.341 MM (+41% vs FY2012)
EBITDA: € 58 MM (€49 MM vs FY2012)
Net Profit: € 20.5 MM (€1,7 MM vs FY2012)
Turnover CAGR of about 76% in FY09/13
Volumes CAGR of about 77% in FY09/13
4
Power&Gas • Renewables • Engineering
Group Activities: Power & Gas, Renewables, Engineering
Power & Gas
GALA operates on the free market as a wholesaler, managing energy
supply from different sources and re-selling it to end customers, in
particular to the Public Administration and to fully or partly Stateowned companies, which make up to 63% of the group’s turnover up to
31th December 2013.
Markets in which GALA operates
The activity of natural gas sales has been started with the thermic year
2012/2013; during 2013 GALA has been awarded the first tenders for
natural gas supply.
Renewables
GALA, through its subsidiary GALA Power, operates the electric power
generation from renewable sources, and owns 6 photovoltaic power
plants, with a combined power of about 4 MWp, installed at different
industrial plants.
GALA manages all steps of the order, from search and analysis of
possible sites and opportunities, to the economic and financial
analysis, authorization procedures up to the construction, Project
Management and Plant Management.
Engineering
GALA, through its subsidiary Gala Engineering, provides integrated
engineering services and consulting activities, studies and research
including the realization of complex projects.
Gala Engineering owns the necessary expertise to face all technical
steps of a project; feasibility studies, technical-economical analysis,
consulting, projecting, directing the works, testing, evaluation of the
environmental
impact,
project
management,
construction
management, in order to deliver a «full package».
Reliability • Fairness • Clarity
5
Headquarters
Markets on which we operate
Target markets
EE Provision at 31 Dec 2013
Abroad
29.0%
Italian
Markets
63.4%
OTC
Italy
7.6%
Power&Gas • Renewables • Engineering
Successful Track Record: Sales Volumes, Turnover, POD
Turnover (€M)
Sales volumes (TWh)
8
6.9
7
5.9
6
CAGR 09-13
76.7 %
5
4
3.1
3
2
1
0.3
0.4
1.600
1.0
0
120.000
1,341.5
1.400
800
600
424.2
400
200
952.7
CAGR 09-13
76%
GALA has supplied about 6.9 TWh
of power to its final customers in
2013, with an increase of about 1
TWh compared to the year 2012
Reliability • Fairness • Clarity
100.000
39.0 79.6
80.000
60.000
504.5
168.0
0
2007 2008 2009 2010 2011 2012 2013
107,183
1.200
1.000
3.2
POD
GALA has reached a turnover of
over €1.341,5 MM in 2013 with an
increase of about 41% YoY
6
62,300
40.000
20.000
0
2007 2008 2009 2010 2011 2012 2013
CAGR 09-13
160.1%
15,500
9,000
50 900 1,500
2007200820092010201120122013
GALA in 2013 has dispatched about
107,183 POD (point of delivery) with
an increase of about 72% YoY
Power&Gas • Renewables • Engineering
History: From the beginning till now
Award of the EE09 Consip
Tender (lots 3 and 4)
Business development in
China (in short-list of the
«low carbon Shanghai»
project)
Authorization by GME
to operate on the
Italian electric power
market
Foundation of
GALA
1980
2001
2002
Foundation of
Co.st.en
(Consulenza Studi
Energetici)
2007
2008
2010
2011
2012
2013
2014
10th march
2014.
Listing on
AIM, Italian
Market of
Borsa
Italiana
Supply on the main
European electric power
markets
Foundation of GALA Engineering
(spin off in 2003 of engineering
activities from Co.st.en)
Reliability • Fairness • Clarity
Opening ceremony of the new
headquarters in Rome (A+
energetic class)
Start-up of the mass market
Awarding of Consip EE11
tenders (lots 6, 7 and 9)
GALA decides to go public on
the AIM Italia market of Borsa
Italiana
Foundation of GALA
Power and start-up of
plant projects from
renewable energy sources
7
Strengthening the managerial
structure
Start-up of gas activities
Awarding of the EE10 Consip
Tenders (lot 2)
Power&Gas • Renewables • Engineering
Shareholders and Structure Chart
Shareholders
GALA Holding Srl
Market
87,56%
12,44%
Scope of Consolidation
Operational Holding
Holding company, operating in the sales of
electric power and gas in Italy, in the
supply of raw materials on the main
domestic and foreign markets and on the
main dispatch and shipping activities
100%
Reliability • Fairness • Clarity
100%
GALA Power SpA
GALA Engineering Srl
Renewable Energy
Engineering Services
Company operating in the generation of
electric power from renewable sources and
owner of 6 solar panel plants with a
combined power of about 4 MWp
Company
operating
in
engineering
services, from structures to technologies,
with a particular focus on power saving
and the improvement of energy-efficiency
8
Power&Gas • Renewables • Engineering
2
Market Scenario
•
•
•
Anti-cyclical and Defensive Market
Electric Power Market
Gas Market
Anti-cyclical and Defensive Market: Market Scenarios
Electric power demand forecast (TWh)
Development
Scenario
Scenario
Sviluppo
Forecast of the natural gas demand in Italy
(bcm)
Base Scenario
Scenario
Base
380
85
370.0
370
80
360
76.5
350
75
338.5
335,8
340
330
83.1
328.2 328.2
322.8
70
77.9
74.9
74.5
73.0
70.1
320
310
65
300
290
60
2012 A
2018 E
2023 E
2009 A 2010 A 2011 A 2012 A 2013 A 2017 E
Source: Terna, Forecast of the electric demand in Italy and of the power need,
2013-2023
Reliability • Fairness • Clarity
2023 E
Source: SNAM,Ten-year development plan of the natural gas transmission
network for the period 2014-2023
10
Power&Gas • Renewables • Engineering
Electric Power Market: Demand evolution and price
 The analysis of the electric power prices
throughout Europe allows to stress correlations
among curves associated to different countries.
Italian Electric Power Prices (PUN) and those of the main EU countries (€/MWh)
90
80
70
60
50
40
30
20
 Among all, in particular, we stress the Italian
Average Price curve (PUN), which stays stable
above the European one, which is a direct
consequence of the generation process, of the
high gas price
Jan-09
Mar-09
May-09
Jul-09
Sep-09
Nov-09
Jan-10
Mar-10
May-10
Jul-10
Sep-10
Nov-10
Jan-11
Mar-11
May-11
Jul-11
Sep-11
Nov-11
Jan-12
Mar-12
May-12
Jul-12
Sep-12
Nov-12
Jan-13
Mar-13
May-13
Jul-13
Sep-13
Nov-13
 Similar differences have been noticed among
future prices in Italy and the equivalent prices
on the main continental markets (Germany,
Italy)
PUN
FRAN
GERM
SVIZ
Trend of demand and net production of Power in Italy, 2006-2013 (TWh)
Source: Production of Gala S.p.A. Management based on Reuters data
 2009 has been the year of greatest discontinuity with
the past, with the combined effect of the crisis on an
international level on the Italian real economy: in the
same year Italy has measured a GDP drop of 5,5% and a
slowdown of industrial production compared to 2008.
 In the following years, despite the sluggish Italian
economy, the national power demand and its net
production have shown a slight growth, up until a new
slowdown in 2012, a year in which thee demand
contraction (after computing system losses) has been
of 2,8% combined in respect to 2011, because of a new
GDP slowdown of 2,4% compared to 2011.
400
350
300
250
200
150
100
50
0
338
340
339
2006
2007
2008
320
330
335
328
316
2009
2010
2011
2012
2013
Net Production
Produzione
Netta
Importazione
Import
Source: AEEG, Annual Activity Report Vol. I, 2013 and previous ones;
Terna, Forecast of the electric demand in Italy and of the power need, 2013-2023
Reliability • Fairness • Clarity
11
Power&Gas • Renewables • Engineering
Gas Market: Trend of natural gas demand and production
Trend of natural gas demand in Italy, 2006-2013 (billions of cubic meters)
90
85
84.5
84.9
84.9
80
 The natural gas demand in Italy has been almost
stable in the 2006-2008 period. A contraction of 9%
has followed up in 2009, because of the full impact of
thee economic crisis.
83.1
77.9
76.5
74.9
75
 In 2010 the demand has risen by about 83 billion
cubic meters and in the following phase there has
been a slowdown in the gas market given to a drop in
consumption.
70.1
70
65
60
2006
2007
2008
2009
2010
2011
2012
2013
Source: SNAM Rete Gas, Yearly Financial Report 2013 and previous years
Values in Billions of cubic meters
 In 2013 the natural gas use for running thermoelectric
power plants has absorbed 30% of the national
demand, whereas the residential and tertiary
customers have accounted for most of the
consumption
2013
Services and civil uses
30.5
Industrial uses
17.4
Thermoelectric uses
20.7
System usage and leaks.
1.5
Total natural gas demand
70.1
National Production
7.7
Net import/export
61.7
Change in stocks
0.6
Gross internal consumption
70.1
Source: Ministero dello sviluppo economico – Dipartimento per
l’Energia – DGSAIE, December 2013
Reliability • Fairness • Clarity
12
Power&Gas • Renewables • Engineering
3
Financials Highlights
•
•
1Q2014
FY2013
IQ2014: Income Statement
Growth in EBITDA (37,9%) and Profit before tax equal to € 20.1 MM (+32%)
 First quarter 2014 results show a great growth compared
to the same period of 2013 and well beyond expectations*.
 Revenues increased by 6.1% in a decline scenario in
domestic consumption of electricity and gas respectively
3.7% and 18.3%, and a general reduction in prices.
 Gross profit increased by € 9.2 MM due to the growth of all
margin components (sales, supply and modulation).
 EBITDA (€ 21.7 MM) shows an increase of 37.9%. The
combined effect of the increase in revenues and EBITDA
resulted in a significant increase in profitability, 7.4% of
revenues (5.8% in 1Q13).
 As a consequence, EBIT improved, reaching € 21 MM (15.6
in 1Q13), with an increase of € 5.3 MM (+34%).
 Profit before tax amounted to € 20.4 MM, an increase of € 5
MM (+32.7%). The applied tax rate is expected to be lower
than 2013 due to the reduction of the Robin Tax (from
10.5% to 6.5%) and to the significant reduction of nondeductible expenses.
€ MM
1Q14
Cons
1Q14
Gala
1Q13
Gala
D
D%
Revenues
291.4
291.0
274.2
+16.8
+6.1%
28.9
28.7
19.5
+9.2
+47.4%
9.9%
9.9%
7.1%
+2.8%
21.9
21.7
15.8
+6.0
7.5%
7.5%
5.8%
+1.7%
20.8
21.0
15.6
+5.3
7.1%
7.2%
5.7%
+1.5%
20.1
20.4
15.4
+5.0
Gross Profit
Gross Profit Margin %
Ebitda
Ebitda Margin %
Ebit
Ebit Margin %
Ebt
+37.9%
+34.0%
+32.7%
35
Results 1Q14 GALA S.p.A.
30
Results 1Q13 GALA S.p.A.
28,7
25
5,70
0,30
20
19,5
15
0,99
21,7
0,78
21,0
2,90
0,04
0,76
15,8
0,20
0,50
15,6
20,4
0,20
15,4
10
* Data at 31/03/2014 are not subject to audit. In addition, for comparative purposes
the analysis is carried out with reference to the results of only Gala SpA, due to the
change in the scope of consolidation in the second half of 2013, and the availability of
quarterly data in 2013.
Reliability • Fairness • Clarity
5
0
Gross Profit
14
Services
Costs Third
Party Assets
Personnel
EBITDA
Ammort. & Dep
EBIT
Costs/Income
EBT
Power&Gas • Renewables • Engineering
IQ2014: comparison with listed companies (Utilities)
Consolidated positioning compared to comparable players in terms of EBITDA and size
Margin. GALA EBITDA margin is among the best in the business(7.4%),
Growth. With reference to the sample considered, GALA was the only
comparable to Enel Energia and Edison. EBIT Margin (which makes the
data comparable between subjects with a different mix of generation
and purchases) is significantly higher than the other groups listed*.
company to record revenue growth together withy a more than
proportional growth in EBITDA, ideal condition of development, in a
context of contraction in revenues for all operators, except for Edison*.
Ebit 8%
Margin
D Ebitda
Gala
7%
50%
40%
Hera
Gala
30%
6%
Enel
A2A
Eidson
20%
5%
10%
Acea
4%
0%
Enel
Iren
A2A
-10%
3%
-20%
2%
Acea
-30%
1%
-40%
Edison** Hera**
0%
Ebitda
Margin
Iren
D
Revenues
-50%
0%
2%
4%
6%
8%
10%
12%
14%
-50% -40% -30% -20% -10% 0%
10% 20% 30% 40% 50%
* For the purposes of this analysis we used public data taken from Interim Report at March 31, 2014. Specifically, we used data related to: A2A (Energy Sector, pagg.160 and following); ACEA
(Industrial Area Energy, p.30); Edison (Performance of Sectors - Electricity, p.20); Enel (Market Area, page 16); Hera (Electricity Area, page 18), Iren (Market Area, page 41.) These data, for the manner
in which they are produced and exhibited, may not be fully comparable.
**The data on EBIT of Edison and Hera are not reported in the Interim Report at March 31, 2014.
Reliability • Fairness • Clarity
15
Power&Gas • Renewables • Engineering
IQ2013: Consolidated income statement
High growth in turnover (+40%) and EBITDA. Net Profit equal to € 20.5 MM
 2013 was an important year for Gala Group, for the
gratifying results obtained and for the numerous action
undertaken to make it become a modern corporation.
Revenues
 Consolidated revenues from sale of electricity and gas
delivered to final customers (€ 1,341.5 MM), increased by
41% compared to 42% of the previous FY.
Gross Profit
 Gross profit reached € 80 MM, an increase of € 58.5 MM
compared to 2012, 5.96% of total revenues and 10.1% of
revenues only from sale to final customers .
Ebitda
 EBITDA reached € 58 MM, an increase of € 49 MM
compared to the previous year, 4.32% of total revenues
and 7.3% of revenues from sale to final customers .
 Profit before tax amounted to € 44.7 MM, an increase of €
38.9 MM compared to 2012. The result includes nonrecurring charges, net of extraordinary income of € 4.9
MM.
 Net profit amounted to € 20.5 MM, an increase of € 18.8
MM compared to the previous year, 1.53% of total
revenues and 2.6% of revenues from sale to final
customers.
2013
Cons
2012
Cons
D
D%
1,341.5
952.7
388.8
40.8%
80.0
21.5
58.5
271.9%
6.0%
2.3%
3.7%
58.0
9.0
49.0
4.3%
0.9%
3.4%
52.9
6.5
46.4
3.9%
0.7%
3.3%
44.7
5.8
38.9
3.3%
0.6%
2.7%
20.5
1.7
18.8
€ MM
Gross Profit Margin%
Ebitda Margin %
Ebit
Ebit Margin %
Ebt
Ebt Margin %
Net profit
80
80,0
60
711.0%
674.7%
1,126.9%
Consolidated FY 2013
17,80
70
544.3%
Consolidated FY 2012
0,20
4,10
50
58,0
5,10
52,9
8,20
40
44,7
30
21,5
20
10,20
2,50
10
0,10
2,30
Costs Third
Party Assets
Personnel
0
Gross Profit
Reliability • Fairness • Clarity
16
Services
6,5
0,70
5,8
9,0
EBITDA
Ammort. &
Dep
EBIT
Costs/Income
EBT
Power&Gas • Renewables • Engineering
16
FY2013: A distinctive positioning, pre and post-listing
Distinctive positioning in terms of ROE and D/E, pre and post listing
Towards a sustainable growth. Even before the listing GALA was
High profitability. Also as a result of its low capitalization GALA has
characterized by a great NFP / EBITDA, compared with other listed
companies in the industry, even with a good debt / equity ratio. In case of
coincidence between the reporting date and the date of listing, GALA would
have achieved better ratios NFP / EBITDA and Debt / Equity among listed
companies in the Energy sector*.
achieved a very high ROE in 2013, with a great ratio of EBITDA/Net Invested
Capital. In case of coincidence between the reporting date and the date of
listing, GALA would have achieved a lower ROE, but still much higher than
that of listed companies in the Energy sector*.
0
60%
Gala Post IPO
Debt/Equity
Gala
ROE
Ascopiave
Eni
50%
GasPlus
0,5
Enel
40%
AcsmAgam
1
A2A
Kinexia
1,5
Hera
Gala
30%
Gala Post IPO
Iren
20%
Alerion
Acea
10%
2
Falck Ren.
0%
12,0
PFN/Ebitda
2,5
-10%
Alerion
10,0
Enel
Hera Ascopiave
AcsmAgam Acea
Eni
Iren
Falck Ren.
GasPlus
Kinexia
A2A
8,0
6,0
4,0
2,0
0,0
CIN/Ebitda
7,0
6,0
5,0
4,0
3,0
2,0
1,0
0,0
*For the purposes of this analysis we used public data taken from Consolidated Financial Statements at December 31, 2013: ACEA, AcsmAgam, Alerion, Ascopiave, Enel, Eni, Falck Renewables, Gala,
GasPlus, Hera, Iren and Kinexia. Data marked as' Gala Post IPO 'have been calculated considering the changes in shareholders' equity and net financial position that would have been determined if
the increase in capital from the listing had occurred at the balance sheet date (31 December 2013).
Reliability • Fairness • Clarity
17
Power&Gas • Renewables • Engineering
FY 2013: Consolidated Balance Sheet and Cash Flow Statement
Decrease of NFP and improvement of the main indicators in cash flow statement
 The Net Financial Position at December 31, 2013 is a net
debt of € 32.4 MM, a decrease of € 34.2 MM compared to
previous year. It includes:
– medium / long term debt € 8.8 MM relating to real
estate leasing and facilities financing for production of
electricity from renewable sources,
– cash collateral € 23.5 MM mainly released to Gestore
del Mercato Elettrico for operations on the electricity
spot markets.
 Net working capital at December 31, 2013 amounted to €
49 MM, a decrease of € 13.8 MM the previous year. It
includes:
€ MM
2013
Cons
2012
Cons
D
D%
Net trade working capital
117.7
112.6
5.1
4.5%
Net working capital
49.0
62.7
-
13.7
-21.9%
Gross invested capital
76.0
87.7
-
11.7
-13.3%
Net invested capital
70.9
85.7
-
14.8
-17.3%
Net financial position
-
32.4
-
66.6
34.2
-51.4%
Equity
-
70.9
-
85.7
14.8
-17.3%
2013
Cons
2012
Cons
D
D%
– customer loans € 322.5 MM (274.3 in 2012), an
increase of 17.5%, less than the increase of revenues
(40.8%);
€ MM
Net Profit
20.5
1.7
18.8
1,126.9%
– tax liabilities € 71.6 MM (53.2 in 2012), an increase less
than proportionally compared with the change in
revenues;
CF from operating activities
38.8
9.3
29.5
315.6%
0.1
-
3.6
n.a
4.2
-
20.1
483.7%
5.2
5.8
110.5%
66.6
34.2
-51.4%
 Equity at December 31, 2013 amounted to € 38.5 MM, an
increase from the previous year to 19.3 MM.
CF from investment activities
-
3.5
CF from financing activities
-
24.3
Total cash flows
Net financial position
Reliability • Fairness • Clarity
18
-
11.0
-
32.4
-
Power&Gas • Renewables • Engineering
18
4
Strategy
•
Strategy Guidelines
Strategy Guidelines
Growth, vertical integration, diversification, internationalization
Upstream
Midstream
 Strategic interest in the development and acquisition of
programmable renewables (solar concentration,
geothermic and hydroelectric)
 Tactical interest in the acquisition of programmable
renewables (biomass and biogas on a short supply chain)
and not (wind energy) at interesting price conditions
 Acquisition/participation on investment in the generation
from fossil sources when (a) interesting price conditions
and/or (b) overcapacity re-absorption
 Further increase of the supply optimization capacities and
modulation
 Strengthening the presence on the continental wholesale
markets (Balkans, Spain, UK)
 Strengthening gas shipping potential, also through
partnerships with foreign companies
 Improving our import capacity in the medium-long term
through merchant line or taking part in new pipeline
development projects
Downstream
Usage & Engineering
 Consolidating the leadership in public tenders for power
and development in public tenders for gas
 Developing a residential and business customer base also
by innovating commercial lines and increasing the market
share
 Evolution of the commercial approach from commodity
supplier to a reliable service provider and offering a broader
range of solutions
 Development of engineering services and in particular
energy efficiency improvement services (invasive
interventions)
 Selection and marketing of products/services for improving
energy efficiency through power and gas commercial lines
 Start-up/consolidating of engineering activities in China
and Middle East
 (taking part in) the development of new technologies and
solutions for energy efficiency
Reliability • Fairness • Clarity
20
Power&Gas • Renewables • Engineering
Issuer
GALA
Via Savoia,43/47
00198 Roma
Luca Calvetti (Investor Relations)
ir@gala.it
Tel: +39 06 375 927 07-6
www.gala.it
Reliability • Fairness • Clarity
IR & Media
IR Top Consulting
Via C. Cantù, 1
20123 Milano
Floriana Vitale – Domenico
Gentile ir@irtop.com
Tel: +39 02 45473884-3
www.irtop.com
Nomad
EnVent
Via Barberini, 95
00187 Roma
Franco Gaudenti
fgaudenti@envent.it
Tel. +39 06 896 841
www.envent.eu
21
Specialist & Corporate Broker
Banca Profilo
Via Cerva, 28
20122 Milano
Tel +39 02 58408.404
Tel +39 02 58408.461
www.bancaprofilo.it
Power&Gas • Renewables • Engineering