The quarter was characterized by +4% growth in EBITDA to 383 million euros and an improvement in debt compared to the end of the year as major investments totaling 184 million euros were made. Major investments in recent years have enabled the achievement of important industrial targets, such as the continued growth in the percentage of sorted waste collection, during the period of 72%, the +14% increase in the quarter of material recovered in the Group's treatment plants, and the 12% growth in renewable energy sold to end customers. Confident of the first quarter results, we raise the guidance for 2024.

Main indicators

• Gross Operating Margin (EBITDA) in the amount of EUR 383 million (+4% compared to EUR 368 million as at 31/03/2023). The increase in EBITDA is mainly driven by organic growth, tariff adjustments in the distribution business, along with the full recovery of the Market BU's margins, despite the significant drop in energy commodity prices that penalised the margins of the power and heat generation business.
• Group net profit attributable to shareholders of EUR 122 million (-10% compared to EUR 135 million as at 31/03/2023). The temporary decrease, as a reversal of the trend is already expected in the coming quarters, is entirely attributable to the increase in the tax rate. Last year, the Group's tax rate was significantly lower, due to the non-taxability of tax credits recognised to counter the costs of energy for companies. Earnings before tax (EBT) are in line with last year.
• Net financial debt improves at EUR 3,912 million (-1% compared to EUR 3,932 million as at 31/12/2023). The improvement compared to the end of 2023, despite significant investments, was made possible by the positive operating cash flow, which also benefited from the assignment of tax credits from Superbonus.
• Investments of EUR 184 million, down 7% compared to the first quarter of 2023, mainly for the construction of infrastructure under the Integrated Water Cycle Sector Plans, the modernisation of gas and electricity networks, the purchase of collection vehicles and equipment, and the construction of waste treatment and renewable generation plants.
• Iren’s sustainable growth continues, with the majority of performance indicators in line with Plan forecasts and improving on the first quarter of 2023: 72% sorted waste collection, +14% material recovered in the Group's plants, 71% water networks districtization and +12% renewable energy sold to end customers.

The Board of Directors of IREN S.p.A. today approved the consolidated financial statements as at 31 March 2024.

"The positive results just approved confirm the financial and managerial solidity of the Iren group, guaranteed by a solid, balanced business plan that we are following and of which we will present an update late June”. - declares Luca Dal Fabbro, Executive Chairman of Iren - “A first quarter characterised by important industrial milestones, aligned with the plan's trajectory, like, for example, the awarding of two tenders in waste collection, totalling almost 170 municipalities in the provinces of Asti and Cuneo, and the award of the tender for the management of Piacenza province's integrated water service through to 2040, worth an estimated EUR 1,254 million, and the signing of the acquisition of the multi-utility of Alba and Cuneo, EGEA. Therefore, confident in the quarter's results, we are raising our guidance for 2024, forecasting growth in both EBITDA and Net Profit of 4% compared to 2023".

"Thanks to investments amounting to EUR 184 million, the Group's growth continues with great focus on financial sustainability. As far as the main ESG targets of the Plan are concerned, at the end of March 2024 Iren has reached 72% sorted waste collection, an increase of +14% material recovered in our plants, 71% districtised water networks and growth of +12% renewable energy sold to end customers.” - declares Moris Ferretti, Executive Deputy Chairman of Iren - “Important results made possible thanks to our employees".

IREN GROUP: CONSOLIDATED RESULTS AT 31 March 2024

Consolidated Revenues as at 31 March 2024 amounted to EUR 1,567.7 million, down -22.4% compared to EUR 2,019.8 million of the first quarter of 2023. The main factors contributing to the decline in sales were energy revenues, which were impacted for more than EUR 500 million by lower commodity prices, partially offset by higher revenues of about EUR 100 million related to higher volumes, also due to the climate effect. Revenues related to energy efficiency activities such as energy upgrades of buildings also decreased, due to the gradual completion of works related to the 110% Superbonus (around EUR -81 million). Finally, changes in the scope of consolidation affect revenues by approximately 24 million euro and refer to the consolidation of Sienambiente (from January 2024) and AcquaEnna (from June 2023).

Gross Operating Profit (EBITDA) amounted to EUR 383.2 million, an increase of +4% compared to EUR 368.5 million for the first quarter of 2023. The first quarter of 2024 was, from an operational point of view, characterised by a less favourable energy scenario than in last year, by major tariff revisions affecting the Networks BU (with the positive update of regulatory parameters) and by the start, albeit not yet fully operational, of the operational phase of some plants of the Waste sector.

As far as the energy scenario is concerned, the main factor characterising the period was the drop in the price of electricity (-41.4% on 2023) and, consequently, in electricity and heat generation margins; this had a major negative impact on EBITDA (EUR -61 million), which was partially absorbed (EUR +30 million) by the higher quantities produced, particularly by hydroelectric production, which benefited from an improvement in hydro levels. Market activities were particularly positive, mainly in relation to the sale of electricity, which benefited from a significant recovery in margins (EUR + 30 million).

A positive contribution to the margin is generated by organic growth related to tariff increases as a result of investments made on the networks in recent years, as well as tariff revisions at the beginning of the year (EUR + 22 million).

Finally, perimeter changes related to the consolidation of Sienambiente (as of January 2024) and AcquaEnna (as of June 2023), amounting to approximately EUR 6 million, contributed to the margin improvement.

The change in the margin with reference to the individual business units is broken down as follows: marked improvement in the Market business unit +42.7%, Networks +29.7%, Environment in line with 2023 and Energy -32.6%.

Operating Profit (EBIT) amounted to EUR 213.3 million, an increase of +1.4% compared to EUR 210.3 million for the first quarter of 2023. Amortisation and depreciation for the period rose by approximately EUR 14.5 million, due to the start-up of new investments and expansion of the consolidation scope, and to lesser net allocations to the provision for risks for approximately EUR 3 million, while the bad debt provision was essentially in line with 2023.

Group net profit attributable to shareholders amounted to EUR 122.2 million, a decrease (-9.6%) from the result recorded at 31/03/2023. The temporary decrease, as a reversal of the trend is already expected in the coming quarters, is entirely attributable to the increase in the tax rate. Last year, the Group's tax rate was significantly lower, due to the non-taxability of tax credits recognised to counter the costs of energy for companies. Earnings before tax (EBT) are in line with last year.

Net Financial Debt stood at EUR 3,912 million as at 31 March 2024, an improvement (-1.0%) compared to the 31 December 2023 figure. The improvement was made possible by the operating cash flow, which completely covered the significant investments. Also worth mentioning is the positive impact of the assignment of tax credits from Superbonus.

Gross investments for the period amounted to EUR 184 million, down (-7%) compared to the same period of 2023, of which EUR 19 million related to the consolidation of Sienambiente. Investments in the period were mainly for the construction of infrastructure under the Integrated Water Cycle Sector Plans, the modernisation of gas and electricity networks, the purchase of collection vehicles and equipment, and the construction of waste treatment and renewable generation plants.