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SNAM RETE GAS PUBLISHES ITS RESULTS FOR THE FIRST NINE MONTHS AND THIRD QUARTER OF 2006

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First nine months

  • gas injected into the transportation network: 65.54 billions of cubic metres +3.9%

  • operating profit: Euro 679 million -11.6%

  • profit: Euro 339 million -18.7%

  • repurchase of treasury shares in the first nine months of 2006: Euro 288 million


  •  

San Donato Milanese, 09 November 2006 - The board of directors of Snam Rete Gas S.p.A. approved the (unaudited) results of the third quarter of 2006 on 8 November 2006.


 

Terzo trimestre

 

Primi nove mesi

 

 

2005

2006

 

2005

2006

Var.ass.

Var.%

   

 

       

 

 

Principali dati operativi ed economici

 

 

 

 

18,26

19,02

Gas naturale immesso nella Rete Nazionale Gasdotti (miliardi di metri cubi)

63,05

65,54

2,49

3,9

0,60

0,53

Gassificazione di gas naturale liquefatto (GNL) (miliardi di metri cubi)

2,13

2,34

0,21

9,9

30.509

30.784

Rete dei gasdotti (chilometri in esercizio)

30.509

30.784

275

0,9

                 249

207

Utile operativo (milioni di euro)

            768

679

(89)

(11,6)

                 136

99

Utile netto (milioni di euro)

            417

339

(78)

(18,7)



 

Carlo Malacarne, CEO of Snam Rete Gas, had the following comments on the results:

" “The company’s positive operating performance allowed it to offset the negative effects of external factors, such as the decrease in transportation tariffs and the cost of fuel gas, on its results. Development of the gas transportation infrastructure, aimed at meeting future demand for new transport capacity is continuing as scheduled.�?.


 

Highlights - First nine months of 2006


 

Financial

  • total revenue: Euro 1,322 million (-3.2%), Euro 1,275 million of which (-4.3%) generated by transportation services; the downturn is due to the application of the new regulation parameters from 1 October 2005

  • net financial debt: Euro 5,007 million; up Euro 188 million on 31 December 2005

  • leverage (debt/debt+equity): 57.24% (31 December 2005: 54.8%)

Operating

  • controllable fixed costs: -4.3% (-6.2% in real terms)

  • controllable fixed costs: -4.3% (-6.2% in real terms)

  • investments: Euro 400 million (-14.2%). Investment outlays mainly related to development of the transportation network in order to upgrade the import system from North Africa and Russia. 83% of the investments are incentivised

Outlook

  • domestic demand for natural gas is expected to grow by an average of 2% over the four years from 2006 to 2009 following the rise in consumption of the thermoelectric sector

  • continued commitment to making the investments necessary to ensure the gas market's growth; investments for 2006 are expected to be in line with those for the previous year


  •  

Highlights - third quarter of 2006


 

Financial

  • total revenue: Euro 418 million (-5.0%), Euro 409 million of which (-4.7%) generated by transportation services; the downturn is due to the application of the new regulation parameters from 1 October 2005

Operating

  • gas injected into the transportation network:+ 0.76 billion cubic metres (+4.2%); the growth is due to the greater quantities of natural gas injected into storage

  • controllable fixed costs: -3.7% (-5.6% in real terms)

  • investments: Euro 176 million (+31.3%)

Disclaimer

This press release includes forward-looking statements, especially in the section on the company's outlook. Such statements by their very nature are subject to risk and uncertainty as they depend on the fact that certain events and developments will take place. The actual results may differ from those communicated due to different reasons, such as foreseeable trends in demand, offer and natural gas prices, the effect of new energy and environment legislation, the successful development and implementation of new technologies, changes in the stakeholders' expectations and other changes in business conditions.


 

Summary of the results for the first nine months of 2006


 

The profit (Euro 339 million) decreased by Euro 78 million (18.7%) compared to the same period of 2005 due to a decrease in the operating profit (down Euro 89 million) and higher net financial expense (up Euro 47 million) reflecting the increase in financial debt incurred for the distribution of the extraordinary dividend in November 2005. Income taxes decreased by Euro 58 million.

The operating profit accounted in the first nine months of 2006 amounts to Euro 679 million, down Euro 89 million or -11.6% on the same period of 2005. This downturn is mainly due to: (i) lower transportation revenue (down Euro 53 million, net of the items netted against costs), negatively affected by the application of the new regulation parameters from 1 October 2005 (Euro 68 million) and positively affected by the increase in volumes transported (Euro 15 million), and lower regassification revenue (down Euro 5 million); (ii) higher operating costs (up Euro 36 million, net of the components offset by revenue); and (iii) higher amortisation and depreciation charges (up Euro 9 million) attributable to investments made to upgrade compression stations and the roll out of new pipelines. The favourable outcome of a dispute with third parties had a positive impact on the company's results (Euro 19 million) leading to a significant rise in other revenue and income.

The income statement for the first nine months of 2006 was affected by non-recurring items that had a positive impact on the operating profit and profit (net of income taxes) of Euro 2 million and Euro 1 million, respectively.

These items related to the recognition of: (i) income following the positive outcome of a dispute with third parties (Euro 19 million); (ii) termination benefits to employees (Euro 15 million); and (iii) expense and income deriving from the disposal and sale of property, plant and equipment (Euro 2 million).

The increase in operating costs (up Euro 37 million) was due to the rise in variable costs (up Euro 26 million), mainly related to the purchase of fuel gas used for the compressor stations and higher non-recurring charges for termination benefits (up Euro 15 million), partly offset by the reduction in controllable fixed costs (down Euro 7 million).

Income taxes of Euro 218 million decreased by Euro 58 million compared to the same period of 2005 mainly due to lower profit before tax.

Net financial debt amounted to Euro 5,007 million, an increase of Euro 188 million on 31 December 2005. The net cash flows from operating activities (Euro 846 million) covered most of the outlays for the payment of the ordinary dividend (Euro 328 million), the repurchase of treasury shares during the first nine months of 2006 (Euro 288 million) and net investments (Euro 418 million).

Long-term financial liabilities made up 65% of net financial debt. The average term of the long-term financing, including the current portion, is roughly four and a half years (roughly five years at 31 December 2005).


 

Summary of the results for the third quarter of 2006


 

The profit (Euro 99 million) decreased by Euro 37 million, down 27.2% compared to the same period of 2005 due to a decrease in the operating profit (down Euro 42 million) and higher net financial expense (up Euro 15 million) reflecting the increase in average financial debt. Income taxes decreased by Euro 20 million.

The operating profit for the three months ended 30 September 2006 decreased by Euro 42 million (-16.9%) from the same period of 2005 to Euro 207 million. The reduction is mainly due to lower transportation revenue (down Euro 18 million net of the items that are netted against costs), negatively affected by the application of the new regulation parameters from 1 October 2005 (Euro 22 million) and positively affected by the increase in volumes transported (up Euro 4 million), higher amortisation and depreciation charges (up Euro 13 million) and higher operating costs (up Euro 7 million) following the rise in variable costs.

The income statement for the third quarter of 2006 was affected by non-recurring items that had a negative impact on the operating profit and net profit (net of income taxes) of Euro 4 million and Euro 2 million, respectively.

These items related to the recognition of: (i) expense and income deriving from the disposal and sale of property, plant and equipment (Euro 2 million); and (ii) termination benefits to employees (Euro 2 million).

Income taxes (Euro 66 million) decreased by Euro 20 million compared to the same period of 2005, mainly due to the lower profit before taxes.

Net financial debt decreased by Euro 21 million compared to 30 June 2006. The net cash flows from operating activities (Euro 307 million) covered the net investments (Euro 153 million), the repurchase of treasury shares during the third quarter of 2006 (Euro 133 million) and led to a reduction in net financial debt.


 

Other information


 

Repurchase of treasury shares


 

In respect of the programme for the repurchase of treasury shares authorised by the shareholders in their meeting of 10 November 2005 for a maximum number of 194,737,950 shares for a total amount of Euro 800 million, on 7 November 2006, 99,996,297 ordinary shares (equal to approximately 5.11% of the share capital) were repurchased for an average price of Euro 3.63 and a total of approximately Euro 363 million.


 

Covenants


 

Snam Rete Gas has entered into loan agreements with banks which entail compliance with certain financial ratios. These are mainly based on Eni group's consolidated financial statements. At 30 September 2006, the financial liabilities subject to these covenants amounted to Euro 9 million (31 December 2005: Euro 23 million). The conditions have been respected.


 

Consolidated income statement, balance sheet and cash flow statement (*)

Income statement


 

Terzo trimestre

 

Primi nove mesi

 

(milioni di €)

2005

 

2006

 

2005

 

2006

Var.ass.

Var.%

439

 

416

Ricavi della gestione caratteristica

1.363

 

1.300

(63)

(4,6)

1

 

2

Altri ricavi e proventi

2

 

22

20

 

 

 

1

di cui non ricorrenti

 

 

20

20

 

440

 

418

Ricavi totali

1.365

 

1.322

(43)

(3,2)

(79)

 

(86)

Costi operativi

(254)

 

(291)

(37)

14,6

(1)

 

(5)

di cui non ricorrenti

(3)

 

(18)

(15)

 

361

 

332

Margine operativo lordo

1.111

 

1.031

(80)

(7,2)

(112)

 

(125)

Ammortamenti e svalutazioni

(343)

 

(352)

(9)

2,6

249

 

207

Utile operativo

768

 

679

(89)

(11,6)

(27)

 

(42)

Oneri finanziari netti

(75)

 

(122)

(47)

62,7

222

 

165

Utile prima delle imposte

693

 

557

(136)

(19,6)

(86)

 

(66)

Imposte sul reddito

(276)

 

(218)

58

(21,0)

136

 

99

Utile netto

417

 

339

(78)

(18,7)



 

Balance sheet


 

         

(milioni di €)

30.06.2006

 

31.12.2005

30.09.2006

 

Var.ass

9.538

Attività materiali

9.575

9.582

 

7

50

Attività immateriali

53

50

 

(3)

(141)

Debiti per attività di investimento

(205)

(158)

 

47

9.447

Capitale immobilizzato

9.423

9.474

 

51

(604)

Capitale di esercizio netto

(601)

(697)

 

(96)

(28)

Fondi per benefici ai dipendenti

(27)

(29)

 

(2)

8.815

CAPITALE INVESTITO NETTO

8.795

8.748

 

(47)

 

 

 

 

 

 

3.788

Patrimonio netto

3.976

3.741

 

(235)

5.027

Indebitamento finanziario netto

4.819

5.007

 

188

8.815

COPERTURE

8.795

8.748

 

(47)



 

Cash flow statement


 

Terzo

       

(milioni  di €)

trimestre

     

Primi nove mesi

2006

     

2005

2006

99

Utile netto

   

417

339

 

A rettifica:

       

126

- Ammortamenti ed altri componenti non monetari

   

345

368

113

- Interessi e imposte sul reddito

   

356

349

338

FLUSSO DI CASSA DEL RISULTATO OPERATIVO PRIMA DELLA VARIAZIONE DEL CAPITALE DI ESERCIZIO

 

 

1.118

1.056

16

Variazione del capitale di esercizio relativo alla gestione

   

(27)

83

(47)

- Interessi e imposte sul reddito incassati (pagati)

   

(92)

(293)

307

FLUSSO DI CASSA NETTO DA ATTIVITA' DI ESERCIZIO

 

 

999

846

(170)

Investimenti in attività materiali e immateriali

   

(438)

(374)

 

INVESTIMENTI IN PARTECIPAZIONI, TITOLI E CREDITI FINANZIARI

       
 

Disinvestimenti

   

1

3

17

Crediti e debiti relativi all'attività di investimento

   

13

(47)

154

FREE CASH FLOW

 

 

575

428

(21)

Variazione debiti finanziari

   

(181)

188

(133)

Flusso di cassa del capitale proprio

   

(394)

(616)

0

FLUSSO DI CASSA NETTO DEL PERIODO

 

 

0

0

           
           

154

FREE CASH FLOW

 

 

575

428

(133)

Flusso di cassa del capitale proprio

   

(394)

(616)

           

21

VARIAZIONE INDEBITAMENTO FINANZIARIO NETTO

 

 

181

(188)

           
           
           

(*) The consolidated income statement, balance sheet and cash flow statement have not been audited. The key captions of the reclassified schedules can easily be reconciled to those of the legally-required format using the same method applied for the 2006 Half Year Report.

Riferimenti societari

Investor Relations Snam Rete Gas
Tel.: +39 02.520.38272 - Fax: +39 02.520.38650
Casella e-mail: investor.relations@snamretegas.it


Ufficio Stampa Eni
Tel.: +39 02.520.31875 - +39 06.5982398
Casella e-mail: ufficio.stampa@eni.it

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updated
05 August 2016 - 16:18 CEST