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Operator: Hello, and welcome to A2A H1 2025 Results Call. My name is Laura, and I will be your coordinator for today's event. Please note, this call is being recorded. [Operator Instructions]. I will now hand you over to your host, Marco Porro, Head of Investor Relations, to begin today's conference. Thank you.
Marco Porro: Good afternoon, everyone. Thank you for taking the time to participate to our first half 2025 results. The conference will be led by our CEO, Renato Mazzoncini; and the CFO, Luca Moroni. I leave immediately the floor to Renato for the first part of the presentation, and then Luca will jump in.
Renato Mazzoncini: Okay. Thank you, guys. Thank you to be with us. So starting from Slide #2, H1 results demonstrate the execution of our strategic plan. You remember, we presented it in November, laying a strong foundation for the continuous growth of our company. And looking at the main achievements, we can start from some industrial push on the electricity. You know our strategy in energy transition is very clear. And some achievements for this semester are the fact that we completed the asset rotation towards electricity grids. As you know, since January, the assets we acquired from Enel, in particular in the province of Milano and the part in the province of Brescia have been successfully integrated into our asset portfolio. And at the end of this semester, with, let's say, a very clear punctuality, we finalized the sale of a part of our gas network to the company Ascopiave for a consideration of EUR 430 million, which we already cash in exactly in the 3rd of June. Regarding our grid development, as presented in the plan, we recently inaugurated a primary substation in Brescia is only one example because you know the primary substation are the king of power grid. In our industrial plan, we have EUR 3.4 billion of CapEx in the next years in power grid. What is very important is that we was able to push strong CapEx also in Duereti that is exactly the part of the network that we bought from Enel in the first month of our new management of the network. That is not so normal, let's say, because to be able to invest strongly in networks you need to know very well how the network is built and so on. And so our engineering was able really to start very, very quickly in the CapEx plan also in this network. Once again, discussing about the strategy in electricity, we reached 1.6 million electricity customers on free market -- free mass market, consider that our strategy also considering our trajectory of net zero is to shift to switch more and more from gas customer to electricity customer. And also in this semester, the growth of the free mass market electricity customers was 11%. So very, very important. The second achievement is business risk profile optimization. And in our Generation business unit, we secured a 17-year LNG supply agreement with British Petroleum for more or less EUR 1 billion of cubic meter for every year of GNL, ensuring greater security of supply and price stability. So we are very happy and this contract will start from the next year. We further improved the visibility of the result stream in our district heating network, in particular, by winning the tender for 20- year concession in Sesto San Giovanni that is in the north of Milano, is a large part of the metropolitan areas of Milano, more or less 100,000 inhabitants. So very important. And we remind you that we now reached a regulated EBITDA that arrives more or less 31%, 32%, thanks in particular to the increasing exposure of our asset portfolio to regulated and quasi-regulated activities. Of course, the acquisition from Enel was very important for this target. As you already know, we are also enthusiastic about the new opportunity quickly materializing in our sector with which we look forward to illustrating surely in the next Capital Market Day. But in the meantime, probably some of you have seen that we announced the inauguration of the first liquid cold data center connected to the district heating. You remember in November, we talked during the presentation of -- [ it was the plan ] about the opportunity to exchange heat from the data center to the district heating. You remember that there is a potential target in Milano, in particular, to reach 150,000 equivalent apartments with its recovery coming from district heating. And we did it with a first pilot started in Brescia and the next one will arrive in the next few months in Milano. And we continue to invest in our industrial development, having already reached more or less EUR 400 million in development CapEx in the semester. So the total CapEx in the semester is -- I don't remember, is more or less EUR 700 million. But once again, 60% are in development. And this is the reason for why our growth is exactly stable and continuous. It's very important also, of course, our relationship with our stakeholders, a dividend payment of more than EUR 300 million, in particular, EUR 313 million to our shareholders in line with the promised annual increased 4% every year, you remember along with consistent industrial growth. And from the other side, the launch of our company's employee stock ownership plan with an impressive subscription of 86% of our colleagues was a target for us really very important to engage our employees and to increase the commitment to the future target of the company. Looking Slide -- looking slide -- sorry, in the right part of Slide #2, you can also look, of course, our Moody's upgrade of rating outlook to positive, that is, once again, the proof that also from a financial point, we are working well. Looking at Slide #3, the consolidation of the new company Duereti from Enel and the increase in the price of energy commodities led to increase in revenues, more or less 13%, so to arrive to EUR 7 billion in the period. The reported EBITDA recorded a limited decrease, but reaching EUR 1.22 billion. But as you remember, surely from our call in the first quarter, the big differences -- there are main differences against '24, but the biggest one is the extraordinary effect deriving from hydroelectric production during '24. You remember, we closed the year with 5.2 terawatt hours. And if we offset this extraordinary effect, the EBITDA grew in '25 against '24 in the first half by 2%. The net profit for the same reason, decreased by 11%. But once again, compared with adjusting, let's say, by the effect of the hydroelectric production is increased by 1%. The ordinary net profit, excluding special items, for example, in there are EUR 8 million referring to the price adjustment relating to the acquisition of a stake in Tecnoa. Tecnoa was the waste-to-energy plant -- industrial waste-to-energy plant in Crotone in Calabria in the south of Italy. And showed a decrease of 11% compared with the H1 '24 standing at EUR 426 million. And once again, adjusting '24 with the hydroelectric production, there is an increase by 2%. Focus on financial disciplines continues, allowing us to improve the solidity of the financial ratios. And as you can see, we arrive to the net financial position on EBITDA ratio in 2.3% (sic) [ 2.3x ], that is a decrease compared to the 2.5% (sic) [ 2.5x ] of '24 and is a very good result also because, let's say, is the flexibility that can allow us to face new opportunity in the future. Slide #4, the CapEx. The CapEx is our key elements in our strategy. And also this year, the increasing is strong, 23% compared with '24. You remember last year, we did also on top on the CapEx -- the industrial CapEx, the acquisition in Enel. So the total investment last year was 2.9 billion. This year, the target to arrive to approxi to EUR 1.7 billion, EUR 1.8 billion, and we are working to reach this target. EUR 403 million are development. The rest is maintenance more or less and something peanuts mandatory. The large part of the CapEx are smart infrastructure. This is the reason for why our RAB continue to increase, but also circular economy and generation are a fundamental part of the CapEx plan. And once again, the division between energy transition and circular economy, so our 2 pillars of industrial plan are 72%, 28%. It's very important to look at the breakdown by SDGs is 85% aligned with SDGs against 15% not aligned. And also the alignment with the EU taxonomy is very high. So we are 51% aligned and eligible 72%. And this is very important because it's the reason for why our capacity to increase the green part of our debt is possible to reach. So I leave the floor to Luca for detailing the EBITDA.
Luca Moroni: Thank you, Renato. Thank you, everybody, for being with us today. Page #5, I would like to underline the growth of some businesses, in particular, Smart Infrastructure, which contributed the best to the result of the first half '25, EUR 62 million, followed by EUR 19 million by Circular Economy business unit, which compensate partially the decrease in Generation & Trading and Market business unit. Of course, we come back several times during the presentation with referral to the hydro effect of '24 which to have a better comparison, we need to take into consideration, keeping in mind that we are talking about EUR 100 million in terms of EBITDA. The result of the first half, EUR 1.2 billion has been quite in line with our target for the year and consistent with the industrial growth we are achieving. Let's go into the detail of each business unit. Generation & Trading again and again, demonstrating the fact that managing different technologies is a way to hedging the risk profile of the business unit. In fact, as you can see, considering a less production coming from hydro for 750 gigawatt per hour for this semester compared to last year, we have produced 1.2 terawatt more in terms of thermal production, 62% increase. This has been an opportunity for the company to offset partially the negative impact. We have had also the effect coming from the energy scenario affecting the result for first half '25. At Page 7, we pass to the Market result where we can underline and pointing out the very positive performance of the power market in Retail business, which offset completely the investment, so some higher cost compared to last year, which could consider -- we can consider as an investment in marketing and commercial future performance. So EUR 16 million towards the minus EUR 14 end-to-end, the EUR 25 million of decreasing in the result could be linked entirely to the safeguarded market. As you remember, we decided to bid in that tender at the end of last year with a decent marginality. And as the market expressed a marginality very, very low, we remain without that customer in our portfolio. It is very important to underline what also Renato said in the presentation at the beginning, which is the increase of our free market customer base in Electricity segment, which increased by 11% compared last year, whilst we have a slightly decrease in the gas customer during the rolling period. The electricity sold has been quite good in electricity, plus 8%, whilst the gas sales decreased by 6%. In the Circular Economy business unit at Page 8, we continue to experience a very nice and positive industrial results in terms of KPIs, you can appreciate at the right part of the slide, how the KPI -- the industrial KPI are very positive in terms of electricity sales, energy recovery and heat volumes. And this lead the positivity of the result, both in treatment and district heating by EUR 14 million and EUR 10 million, respectively, which compensate entirely the minus EUR 5 million related to the result of the tender of the collection auction for Milano area, which has been -- which started at the end of last year and will give the effect for the entire '25. At Page 9, the very good news related to our business of the Smart Infrastructure, in particular, electricity distribution with the perimeter of Duereti, which come from the acquisition from e-distribuzione, accounting for EUR 44 million in terms of EBITDA, but also the positivity related to the regulated revenues, which give us the opportunity to increase by 33% in this business unit. It is very important to underline what we have considered in the nonrecurring item, EUR 27 million out of those EUR 23 million are related to gas adjustment for previous years -- so we -- in such a way, we need to consider it in terms of marginality for the Gas business. The RAB increased both because of the acquisition and for the CapEx plan, which is pretty good, also taking into consideration Duereti new company, which started very fast in the implementation of the new CapEx plan and also the previous perimeter. In terms of RAB, we reached EUR 1.6 billion for electricity, and we are at EUR 1.8 billion for the Gas business. Page 10 we can give a look at our profit and loss, starting from the EUR 1.2 billion EBITDA, EUR 469 million depreciation and amortization, EUR 28 million increase compared to last year, EUR 15 million of those related to the delta perimeter related to Duereti, a decrease in the risk provision related to the debt for the funds or the debt related to the landfill post operating activities. The net financial position -- sorry, the net financial expenses EUR 85 million related to -- with an increase of EUR 24 million compared last year related to the issuance of the new European green bond of last January and the green loan, the bridge green loan issued last year for the acquisition of Duereti. The operating profit, EUR 635 million. Then we have the taxes with a tax rate of 29%, minorities for EUR 23 million and the net ordinary income of EUR 426 million, the special item already mentioned by EUR 8 million to reach the net result and the net income of EUR 434. Page 11. We are very satisfied about our financial performance. Cash flows are quite positive and let us funding all the investment and the dividends with our net operative cash flows, a very nice and positive result in terms of management of net working capital, which gave us EUR 200 million in terms of positive cash flows. We have EUR 300 million of cash out related to taxes and financial expenses. And as you can see, EUR 1.1 billion of net operating cash flows, which gave us the opportunity to fully fund investment and dividends, resulting then with EUR 126 million of net cash flow. Then we have the cash in coming from the asset rotation to Ascopiave of our gas asset we sold to them. So the decreasing of the net financial position by EUR 510 million, giving us the opportunity to decrease the leverage from 2.5x to 2.3x, which is very nice result, giving us the opportunity to look at the market in terms of financial stability and sustainability in a very good position. Last but not least, the cash conversion rate, plus 65%, which gave us the opportunity to have this kind of items in the cash flows.
Renato Mazzoncini: Okay. So guys, to conclude, despite, frankly speaking, a super positive semester, we decided to be prudent and so to confirm the upper end of our guidance. The number are the number that you know, so EUR 2.2 billion of EBITDA and EUR 0.7 billion of net ordinary income. And to conclude in Slide #13, only to recap our strategy, our strategy is completely CapEx driven. So also this year, in '25, double-digit CapEx increase, you remember 23% on track with targets. So looking our industrial plan also in '25, we did exactly the ordinary net income and the EBITDA that we announced in the 10 years industrial plan, like usually. As Luca said, very strong cash flow generation, more than 65% of cash conversion only in the first half. That means solid year-end net financial position, that means able to invest more and more. So our strategy is on track. Thanks, and we are open to Q&A.
Operator: [Operator Instructions]. We will now take our first question from Sarah Lester of Morgan Stanley.
Sarah E. Lester: I just have one question, please, multiple parts and all related to the electricity distribution concession extension process. Wondering what the latest is on that? When is the next document expected? And what can we expect to see in that document? I just want to be really clear, please, what we can expect and when, given I believe today was one of the dates that had been previously discussed? And then just further to that, could you please remind us what fee, if any, is already included in your CapEx plan from last November?
Renato Mazzoncini: Look in the distribution electricity concession, the law is inside our balance law -- national balance law last December. The topic is that we need ARERA, our authority to define some proposal to our ministry for the ecological transition to fix the elements of the evaluation of the CapEx that we need to have the new concession. And in this moment, the actual Board of ARERA expired the 8th of August. And we are waiting from the parliament the appointment of the new Board probably during August. And so we expect it to have some news in September because it's clear that the new Board will take some weeks to close this dossier. But what is key for us is that the law is very clear. The period is very clear, 20 years. And so the only elements that we have to wait is exactly to understand which are the elements of evaluation of the CapEx plan that we have to present it to submit to have -- to open the discussion for the new concession. So there are not other topics that also the topic of eventually concession fee is out of the RAB because the idea is to have a part of the concession fee one shot but inside the RAB. So it's not a cost for our companies. And this is coherent in my personal opinion, with the fact that we had to invest a lot in and very quickly in electrical distribution to face the electrification. And we have -- it is impossible to wait 2030, that is the natural expiration time for the old concession. So no news. The only news is that we have to wait the new Board of ARERA to close the dossier.
Sarah E. Lester: And just quickly to follow up, do you assume some element of fee in your CapEx plan last November?
Luca Moroni: Well, the fee are not included yet in the CapEx plan, of course, also taking into consideration the fact that we don't have any rule for the estimation. So the number -- it would have been a tumble number with the new plan, of course, we will adjust it accordingly. And if and when the rule of the game will be issued by ARERA and the Ministry of Economy. Yes. But of course, also taking into consideration the financial sustainability we have demonstrated to have, I think that the amount of money we are talking about don't have any kind of impact which afraid us in any way.
Renato Mazzoncini: Yes. But because you have to consider other elements in -- the total CapEx in the last 20 years, not only in Italy, but also in other countries in Europe in electrical grids was very low, in particular, because there was a lot of CapEx in gas network. In Italy, the total -- the investment in power grid arrived to 1980, let's say, and then for 30 years, only CapEx in gas network because the idea was to face the new energy needs with gas. Now with the decarbonization, we have to come back to invest in power grid. But our industrial plan in January '21 increased a lot the CapEx for power grid. And if you look our historical power grid, we arrived already to triple the CapEx compared with the old period. And also in this moment in the new network bought from Enel immediately in January, February, March, we doubled the CapEx that Enel did in '24. And this is inside our CapEx plan. So frankly speaking, I imagine that our volumes of CapEx in the power grid is absolutely enough to open the discussion with the authority for the new concession because stand-alone, we decided to increase the CapEx.
Operator: We now take our next question from Francesco Sala of Banca Akros.
Francesco Sala: Three, if I may. The first one is hydroelectric generation. I wonder what you expect in terms of volumes for the second part of the year and what is embedded in your 2025 target? The second one is on treatment. The performance here, both in Q1 and Q2 was particularly strong. I wonder whether you can shed some light on this trends. And secondly, if we will see in H2 the same growth as the one we saw in H1. And finally, on, let's say, flexible generation, I wonder what you expect in terms of spark spreads in the next few months or at least as long as you have some visibility on this segment of the market?
Renato Mazzoncini: Okay. For the first question about the volumes, looking at the hydro production, we are exactly in, let's say, in the average level of the last 10 years, so 4 terawatt hours. In winter, the snow was not so exciting, but it's raining. So there is a compensation. And until now, the production is absolutely on line with our expectation. So 4 terawatt hours. If you look at the thermal production, the reason for why we did more than last year are double. The first one is that there was exactly less hydro production. The second is that looking in Europe, there was a reduction of wind of more or less 15%, 20% depending on the areas. And so we saw less import from France probably because France exported in Germany to compensate the reduction of hydroelectric production in the north of Germany. Of course, I don't know what can happen in the last month. So in our budget, let's say, there is a normal production for thermal for the next semester. Of course, it's possible to see some upside also in this case. We know that, let's say, if you have like A2A all the form of generation, every time you can go to goal because the total consumption in Italy is more or less the same. And so if you have thermal, hydroelectric, sun and waste-to-energy plant, there is a natural hedging between the different sources of production. Talking about the treatment, the price, you have seen in the first semester was 9% more better than in '24. And we absolutely expect it to maintain the same performance. The reason probably is that the ratio between demand and offer is completely unbalanced to the offer because there are 4 million of tons of waste that go to landfill in Italy. And 2035 is coming in the EU community, we need to arrive to not more than 10% in landfill. And so our plants when have capacity are able to produce, let's say, a good price. The third one, Luca? Flexible generation, spark spread?
Luca Moroni: Yes. Actually, it has been partially answered because the fact that we can play with different technologies gave us the flexibility to stay in the market in a very good position. So taking advantage if other technology don't work in line with the previous year or the previous month. And what has been the result in the month of January, February with the production of thermal plants in which we produce much more volumes than expected. In terms of spark spread, we can stay on the market and see with the flexibility we have in the plan we manage when it could be the case to take advantage from the prices as well. So this is the situation. The market is going to express still some spread low double digit, which is not bad. I remember to all of you that we are hedged by 70% of our production for the fixed production at [ 120 ], which give us a certain comfort also for the second part of the year. Having said that, we are quite comfortable about the generation performance for the second half.
Operator: And we'll now move on to our next question from Javier Suarez of Mediobanca.
Javier Suarez Hernandez: Three questions from me as well. The first one is on the guidance. So if I'm not mistaken, the net income that of first half 2025 represents something like more than 60% of the full year target at the upper end of the range. So the question is, what is preventing the company from increasing that guidance that we have for 2025, i.e., which are the dynamics that you see in the second half 2025 that we should consider and that makes you to confirm guidance and not increasing that guidance? That would be the first question. Then the second question is on the Generation business. I think that you have said that the output that you're expecting for 2025 is 4 terawatt hour. I think in the previous conference call, you mentioned 4.1 terawatt hours. Just to confirm if you are reducing that hydro output guidance for the year or simply you are rounding that figure? Also, I would like to know the level of contribution from the MSD market that you're expecting this year and the level of hedging that you have for 2025 and '26 as we speak? And then the third and final question has to do with the with the hydroelectric concession renewal process. So the question is, if you can update us on that process? And if as part of that agreement, A2A and I guess the rest of the sector could allocate part of the capacity to the energy-intensive industry. What is -- if that is a possibility? And what is that discussion with the different administration? Any update on that would be very helpful.
Renato Mazzoncini: Okay, Javier. For the first question, I was honest. I said that we prudently decided to maintain the guidance. So this is the answer. For the second, you are -- it's correct, 4.1, you remember very well. Yes, because 4.1 is exactly the average level for the last 10 years, and we imagine to maintain exactly this level. Then consider that our storage and you know very well, our storage of water in our basin is 0.5 terawatt hour. So you can understand that the regulation 0.1 more or less is very easy to do. So we want to arrive to the end of '25 with 4.1 and our full basin, and we imagine to be able to do. For the MSD contribution...
Luca Moroni: Yes, MSD contribution, we are expecting to stay in line with the previous year. Even though we are a couple of million above the previous year result in the first half, we are talking about a total amount in between EUR 95 million to EUR 100 million as it has been several times said by us, which is the target of the plan by now. In terms of hedging, as I said, we are completely hedged for the second part of this year, 70% is exactly the target we want to have to stay in a comfortable situation. We also reached 40% for '26 at a price of EUR 113 [ million ], which is, again, a very good position in which we are very comfortable.
Renato Mazzoncini: Okay. For question number 4, it's a little more complicated. You remember that we arrived to deal the [ so said ] fourth way because the regions can reassign the hydro concession through tenders, direct assignment, mixed society and now there is the discussion about the fourth way. The fourth way needs an agreement with Europe because you remember that inside the PNRR agreement, there is the topic of a tender for the hydro concession, is very clear that no one want to do hydro tenders. And in the last month, there was an open discussion with -- inside the [indiscernible], in particular with the steel product, so [ Antonio Gozzi ] and the other guys about the fact to have some hydro release able to reduce a little bit the cost of energy for this sector. After some months of discussion, there is, in effect, an agreement. Consider that our company is -- for us, the impact is approxi to 0 because the discussion is between the price of energy and the concession fee. So our discussion is if there is an hydro release, for example, the discussion is 15% of energy sold with more or less EUR 70 per megawatt hours. It's clear that it's impossible to pay in this part of energy more or less EUR 24, EUR 25 per megawatt hours of concession fee. But in an agreement that seems to be able to go to target, region Lombardy decided that is possible, is possible to accept this hypothesis. And exactly last week, there was a meeting in regional Lombardy to find an agreement between region producer of energy and consumers. And the idea is to have this hypothesis of hydro release on top of the different solution to reassign the concession. So it's the same, let's say, if the region decided to do a tender or to assign through the fourth way. This is key and super important because the idea is not to produce an agreement that produce like effect, the fact that the fourth way is not the best way for the region. So it's very important that both tender or fourth way for the region is the same. So the idea is to change an article of the Decreto [indiscernible] is top of the fourth way in which every solution has embedded the hydro releasing. And so the effect is that the decision to do tender or to do direct assignment to the actual incumbent don't change anything with the money of the region, so to be clear. And also for us, the impact is really peanuts because for us, let's say, the fourth way means to present [indiscernible] a business plan with the current remuneration of our CapEx of our operation and maintenance. And so in this business plan, there are from one side, the price of selling energy from the other price, the cost of the concession fee and so, let's say, the sum is EUR 100 [ million ]. It's clear, Javier.
Operator: And we'll now take our next question from Roberto Letizia of Equita.
Roberto Letizia: The first one is very quick. On the net income guidance, you actually specified that the guidance is net of the nonrecurring. But so far, we saw only positive actually one-off elements. So can you please just very briefly clarify what do you mean for the EUR 700 million, so the up of the range without considering the nonrecurring? Then I would like...
Luca Moroni: Sorry, Roberto. If you can speak a little bit far from the mic because otherwise, we can't hear you.
Roberto Letizia: Yes, I'll repeat it. I'll repeat it. So yes, you specified that the net income guidance in the top end of the range provided is actually excluding the one-off or the nonrecurring...
Luca Moroni: Yes, correct. It is on the order.
Roberto Letizia: Yes, can you just please clarify what are we considering here because we saw the nonrecurring on EBITDA. So can you just very briefly clarify what does that mean? Then the data center -- or actually, which elements are you actually referring to? The second question is on the data center. Very quickly, we were seeing the first project, which are actually pilot projects for that. Wondering if you can update on how fast this market is actually moving and beyond only pilot projects, when you actually think there may be something coming into your business, which is more consistent from a commercial point of view. So actually, how fast is actually this market moving? Then if you can please highlight us which kind of additional offer, and I mean inorganic possible options that are materializing for you in the market, both in terms of clients, networks or eventually companies that may come in jumps in to help the organic growth? And very briefly, the last one, if you can start designing for us how 2026 is actually starting to look like beyond the forward sale that you mentioned before. So maybe the moving parts that you are seeing are materializing for next year as probably you'll update your strategy plan maybe you have, at least from a qualitative perspective, an idea of what 2026 is going to look like?
Luca Moroni: Okay. Again, the first question, yes, I confirm that we are talking about ordinary net income. Looking at the first half, the difference between ordinary and net income, including a special item. This is the situation in which we explained EUR 8 million related to adjustment we can consider not recurring, specifically, EUR 7 million related to the adjustment of the price for the acquisition of Tecnoa, the plant in Crotone, we bought 3, 4 years ago. And there was a finalization of the open points, which gave us EUR 7 million of a plus and another EUR 1 million related to a minor transaction. So that has been the difference between net income and ordinary net income. Related to data center, maybe I switch to Renato, which can give you the...
Renato Mazzoncini: Probably to give an idea of the incredible acceleration in the data center business is enough to say that starting from the fact that seems that in Italy, all the data centers want to live near Milano. That means that in this moment, 60%, 70% of the demand for new data center are around Milano. It is again, let's say, only in the power grid that we bought from Enel last year and only since January, we received the demand for new connection for 220 megawatts of new connection. That means to understand all what they need a city like Brescia and Bergamo, so it's huge. And why they ask connection to the DSO and not to the DSO because in some cases, there are also data center bigger than 10 megawatt that is the size typically in which there is a switch between DSO and TSO. Because they ask to Terna to have a connection, let's say, 30 megawatts. Terna say, "Okay, it's possible, but you have to wait for 3, 4 years." For us is -- for them is impossible to wait because the market is now. And so they arrive to our DSO to do and say, okay, but it's possible to have 10 megawatt so I can start and then when we'll arrive the higher connection with Terna, I can grow, let's say. And because the DSO, in particular, now that is inside A2A is absolutely quicker. So my idea is that the market for the data center also in Italy will arrive in the next 2, 4 years, no longer also because if you look at other countries like Ireland and so on, the idea is that this is the moment for Milano, for Madrid, for other metropolitan areas that have to recover capacity against countries that for many reasons are more strong than us in data center. And it is an incredible opportunity for A2A because we have the grid, we have the generation. They need absolutely baseload. And the only way also in U.S., in every part of the world to have baseload power generation is gas generation. And you know our power gas generation, how strong is and how is able to give baseload connection. We have district heating and so we have possibility to increase the POE, so the sustainability of this machine and maybe also the capacity to help a path for permitting and so on. So I think that can become a business for us quickly. About M&A, I'm sorry, but the answer is as usual. So we have a strong CapEx plan, and we are able to arrive more than EUR 3 billion of EBITDA with organic growth, but it's clear that with our flexibility, if some opportunity will arrive on our path, surely, we are able to look at it.
Roberto Letizia: 2026, please? That was my last question.
Luca Moroni: Well, I think that the only answer you can have now it is that it is in line with the business plan. So we already discussed several times and until we prepare the new budget and the new business plan, nothing changed.
Operator: We'll now take our next question from Alberto De Antonio of BNP Paribas.
Alberto de Antonio Gardeta: I have two or three remaining questions. The first one will be regarding a report that are published recently suggesting that you could have been involved in some kind of market manipulation and there could be a final decision of potential sanctions to arrive by March '26 at the latest. Maybe if you could elaborate what are the implications of this report? If you could quantify what will be your base case and worst-case scenario in terms of sanctions, if any? And also, if this could trigger any potential revision on your clean spark spread target that you have in your business plan. And the second one will be regarding your balance sheet on the trade receivables past due. I've noticed that in the last few quarters, the amount has increased substantially, although in the last quarter has decreased. But could you explain us what has driven this increase? And what should we expect for future quarters? And if these trade receivables are specific of one business unit or are coming from all aggressive business units. And finally, one final question regarding district heating. If I'm not wrong, a new regulation is expected for 2026. Could you elaborate where we are in terms of the discussions with ARERA? And what's the time line that we can expect for it and your expectations in terms of returns?
Renato Mazzoncini: Okay. I think that we can talk about ARERA altogether. So question #1 and #3. About the first question, I think that it can be useful to divide the two elements arriving from ARERA in the last weeks. From one side, the new interpretation of the remit. The remit probably is a regulated framework defined in Europe in 2011 for the functioning of the energy market, in particular, of marginal price in the free market of energy. And every company that I know in Italy dispatch energy since 2011 in the same way. And this actual Board of ARERA was appointed 7 years ago for 7 years, never discussion about the way to dispatch energy was open. So first of all, it's very strange that in the last 2 weeks of this Board, they open a discussion, very complicated, let's say, because the discussion is an interpretation of a remit. And in particular, the discussion is if in the merger price is possible to introduce an opportunity cost that is the cost to have a little marginality in your thermal production. That for us, of course, is absolutely normal because if the interpretation correct was that you have to put your energy on the -- after the market without marginality for me, it's much better to maintain close the plant, of course. So from one side, there is a discussion that is open to all the companies, the dispatch energy in Italy inside Electrica Futura [indiscernible]. Also because in this survey, ARERA individuated 25 companies that dispatch energy. And for example, there are not 25 companies that dispatch thermo energy in Italy that dispatch thermo energy, there are four or five, let's say. So is a survey open also to solar production, or a production tool. So very high-level discussion. And I think that in the next month, with the new Board, Electrica Futura will face this topic to find a solution. And if you ask to me, I absolutely don't expect it to have effect in the way to dispatch energy for the next years. In particular, the decision of ARERA to open not a sanction, let's say, but I don't know how it's possible to say, is a process to evaluate its sanction is related to March '22. And surely, you remember that Putin decided to attack Ukraine, the 24th of February of '22. And you remember what happened in March '22 with the highest volatility in energy in all the history of the world, the highest price that arrives to EUR 600, EUR 700, EUR 800 per megawatt hour. The newspaper that says to all the citizen don't use gas because I don't know if in October, we'll have gas or not. And our marginal call account arrived to a couple of billion of euros to be able to trade energy in the long period. So a situation, in which, let's say, surely no one company stayed in this situation to try to gain EUR 1, EUR 2, EUR 3 per megawatt hours in the dispatch of money. So I don't know, frankly speaking, why ARERA decided to open this. There are 250 days, 250 days to conclude this process. If you -- if your question is, is material or not the eventual sanction, the answer is not material. So it's more a topic of principle to understand. And this is very important because it is a pilot, let's say, that is useful also to face the more general interpretation of ARERA for all the energy market. So I imagine that we and with Enel, with Edison, with all the friends in Electrica Futura, will be able to face this discussion with the new authority because this authority expired the 8th of August. This is the reason for why also for district heating, new regulation, we have to wait because this authority decided not to move forward in the discussion of district heating regulation because, of course, and is correct to leave to the new authority the decision of what to do.
Luca Moroni: Regarding trade receivable and the performance we are going to expect until the end of the year. The trend, generally speaking, is that trade receivable will increase at the end of the year accordingly to the seasonality of the market. These are more related to the supply business unit, which is the business unit on which we have the most important part of the total receivable in the balance sheet. But as we have lost safeguarded the market for the reason I explained before, the positive effect on the other side is that we will have a decrease in trade receivable related to the part of this segment, but also the fact that some of those customers are reassured by a mechanism with the regulator, which guarantees us to receive a certain amount of money for those customers are not disconnectable. And according to that, we will receive something like EUR 60 million cash, which contribute to give us a better cash inflows for the future for the end year.
Alberto de Antonio Gardeta: Maybe a follow-up on this last answer. This mean that the EUR 60 million is like a recurring impact? Or it's just like compensation one-off?
Luca Moroni: It is a one-off. It is related to the fact that we -- let's say, for this -- it would have been recurring in the case we gained the safeguard market again and again. But in our case, as we lost the tender for the reason I explained that the marginality was pretty low, should be considered as a one-off.
Alberto de Antonio Gardeta: And therefore, and apologies for following up, of those EUR 700 million of trade receivables past due, how much are related to this springboard of the safeguard that have to be compensated by just EUR 60 million?
Luca Moroni: More or less EUR 300 million, but we can be more precise later on, if you want. But this is the magnitude, more or less the 50% of the total amount of the trade receivable you see in the balance sheet. The other ones affected by the seasonality, of course. So you have this amount, which at the end of the year is a picture in which you are at the peak of the seasonality. And during the year, you have the cash in accordingly.
Operator: We'll now move on to our next question from Davide Candela of Intesa Sanpaolo.
Davide Candela: I also have three, if I may. The first one is still on data centers more related to ways commercial purchases. So I was wondering if your strategy will be participating in the connection for electricity networks and maybe proposing yourselves as a supplier or if you are thinking about potentially involving and putting some equity in some projects in order to accelerate the execution and maybe the commissioning, and also have some, I don't know, some kind of a framework agreement that is benefiting you. Just wondering if you can update on that. Secondly, on the energy supply, looking at the customer base, it seems that among the biggest one -- the biggest operators in the market, at least looking at the utility side, you are one of the few that did not lost some customers in the first half of the year. And so just wondering if you can update us on the competition, how you see the churn rates and if there are some newcomers that are really treating in the market? Or is this just a temporary thing? And last on a clarification on the guidance with regards to the net debt. If I take the upper end of the EBITDA, 2.5x, that is the ratio you are seeing for debt to EBITDA, I come to kind of a close EUR 5.5 billion. The consensus is like more than EUR 200 million higher currently. So I was wondering what is the consensus not seeing or if it is just some roundings or if it is some structural working capital that is fully recovered and will not represent by the year on the hand?
Renato Mazzoncini: Okay. For the first question about data center, we are discussing exactly in this week, the new strategy, but we want to introduce it inside the update of the industrial plan. Surely, the idea is to be a partner because we know that we can be completely key for a data center developer because we are able to give the connection, but it is also to be clear, an incredible opportunity for the manager power grid because are not activities on RAB on tariff, but are commercial activities, of course. And the cost of the connection for 10 megawatts or 200 megawatt is absolutely relevant. On the other side, without power, baseload power supply is impossible to -- with redundancy is impossible to imagine to have a data center. And from the other side, the data center compete one each other and the sustainability, so the KPI, PE of the data center is key to be -- to face the appetite of the final customer. So in a situation like this, you can imagine easily how many developer of data center are knocking to our door to open discussion. We are able to put also equity and can be an interesting opportunity because seems super interesting like return of capital. And for us, it's also interesting the fact that the area, which is probable to see really development of data center is exactly our areas. That means more or less the triangle with Milano, Brescia and Bergamo. Remember that data center needs also backup from big, big problem that is floody, earthquake and so on. And so there is a need of backup with plants that maintain, let's say, 50 kilometers one from the other. And this is the reason for why we are analyzing also a triangle between different cities in Lombardy, near Milano, but also cities like Bergamo or Brescia or Lacchiarella and others, so all in our territories are surely eligible to be back up from Milano. In this moment, the huge development is near Milano. Milano needs back up out of the province of Milano. And this is the other reason for why you can understand how it's interesting to have a -- to like a partner. If you consider, for example, that our waste-to-energy plant, for example, the waste-to-energy plant in Brescia is able to source 60, 70 megawatts of power, continuous power, baseload, 50% of energy green because it's a part of the waste that is in carbon neutrality, wood and so on. Also, from this kind of plant, it's very interesting to be able to be sourced if you have data center. So we'll define clearly our strategy in the next month, but absolutely is possible also to see it way like investors in this sector. For the customer base is clear our capacity to compete. Ever in the last year, our churn was much better than the average churn declarated from ARERA for all the other competitors. And when the competition is higher, the level of quality that you give to your customers is directly linked to the churn and the result is the possibility to grow or not with your customer base. So in this moment, we are very happy because our strategy is working well. The cost to acquire increased a little bit because we decided to also, let's say, so not only digital of our direct channel, but also store very developed in the Peninsula. In this moment, we have customers in 99% of the municipality in Italy. And so the other reason for why we are growing is that our brand, our awareness is very high. And when -- probably in another call, I said that our awareness in this moment is 67%. Our market share is 6%, 7%. And the differences between market share and awareness is the reason for why there is a funnel that helps the growth of our customer base. Related to the ratio of net financial position EBITDA, yes, I can say that it will improve compared to the, let's say, level to be below 2.7, 2.6. And we are going to project 2.4, 2.5 at the end of the year. This is due to the nice cash flow we are going to experience, as you have seen, but also for the rest of the year.
Marco Porro: So thank you, everyone, for participating to the conference call. Thank you for your question. If you have any additional deep dive requests, please contact the IR department. And in the meantime, I wish you a very pleasant and relaxing summer break. Thank you, everyone.
Renato Mazzoncini: Thanks. Bye.
Luca Moroni: Bye-bye.