Ladies and gentlemen, good afternoon. This is the Chorus Call conference operator. Welcome. Thank you for joining the presentations of ACEA for the results of 2025. As a reminder, all participants are in listening only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to the Head of Investor Relations of ACEA. Please, you have the floor, sir.
Ladies and gentlemen, good afternoon, and welcome to the presentation of the 2025 results of ACEA. Fabrizio Palermo, General Manager and CEO, Pier Francesco Ragni, Co-General Manager, and Valentina Bragaglia, CFO, will illustrate the highlights and the main results of the group. I'll give the floor to the CEO, who will make an introduction to the presentation.
Well, thank you very much, Dario, and good afternoon, ladies and gentlemen. I will start my presentation by expressing a high satisfaction for the results reached in 2025, which really represent an all-time high for the Acea Group. Let me give you the details. Acea reached a pro forma EBITDA of EUR 1.42 billion, up 10% versus 2024. By outperforming in this manner the annual plan targets, where we announced an average growth of EBITDA by 5%. Such result is at the upper end of our guidance range that was provided and which was +10% versus 2024.
Now, I need to remind you that the guidance had already been reviewed upward in 2025 versus the initial target of +2%-3%. As to the pro forma debt EBITDA ratio, 2025 was closed with a ratio of 3.28 below the guidance, which was 3.4-3.5 times. As to CapEx in 2025, we have closed the year with EUR 1.5 billion of CapEx, of which EUR 1.2 billion net of subsidies. Now, let me move to next slide, dividends, and we are going to propose the dividends to the next shareholder meeting.
Considering the strong results reached by the group in 2025 and considering the sound financial structure, the board decided to propose a distribution of dividends equal to EUR 1.20 per share, the growth by 26% versus 2024. Let me remind you the dividend policy of our plan, and this is just an average growth of dividends by 4%. Last year, we distributed a dividend of EUR 0.95 per share, growing by 8% versus 2023. The dividend of this year of EUR 1.2 per share includes a one-off of EUR 0.25 related to the all-time high results and also the capital gain due to the disposal of the high voltage grid to Terna.
Now, here you see the results of the last three years. During this period, we have gone through a strong operational and organizational transformation. Now, the path allowed us to strengthen the efficiency and the competitiveness of our companies, and we have been able to establish our role of player with a focus on regulated infrastructure business. In these three years, we have strongly accelerated the CapEx plan and maintained at the same time a strong financial structure. The debt/EBITDA ratio at the end of 2025 was equal to 3.3 times, which is strongly lower versus what the main rating agencies envisaged. Our performance was recognized by the rating agencies.
As a matter of fact, Moody's raised our credit worthiness from Baa two to Baa one, which improved our outlook from negative to stable. The market, I have to say, also reward the results that we have reached and the growth trajectory that we have gone. The total shareholder return has grown by 176% between 2022 and February 2026, when ACEA went above EUR 5.6 billion of market cap. This is a result which testifies also the trust of investors and the effectiveness of our strategy with the industrial plan launched three years ago.
Now, in this next slide, we shall go through the performance achieved by the main businesses of our group, driven by major CapEx, and on the other hand, driven also by the improvement of the operational dynamic of the group. In the water business, EBITDA EUR 820 million, up by 23% versus the data of 2022. As to CapEx, we have accelerated strongly in this business. In 2025, CapEx amounted to EUR 891 million, up 46% versus 2022. Now, this momentum allowed us to launch a number of strategic operations to modernize the infrastructures. Such infrastructures will be up and running in the next few years, although the projects have already started.
For instance, the Peschiera project, which is the biggest water operation or biggest water plant in Italy and in Europe as well. Now, we won all of the water tenders launched with 870,000 inhabitants more versus 2022. Then the budget law of 2026 of Italy envisages the possibility of the extension for 10 years of the duration of ATO 2 Lazio Centrale , thus giving us a better regulatory visibility to all of our business. As to the electricity business, well, the grids and public lighting business, EBITDA EUR 449 million, up 27% versus 2022. CapEx are growing here even more rapidly, reaching EUR 385 million, up 43%.
We have completed the strategic asset rotation program by disposing of the higher voltage grid with Terna and Acea Energia disposed and sold to Plenitude. Such operations favor a more focalized business on regulated businesses. As to the environmental, EBITDA goes up to EUR 87 million, up EUR 37 million versus 2022, whereas CapEx reached EUR 160 million, up 152%. We started our works for the WTE of Santa Palomba. This is a WTE which is going to be the biggest WTE with a processing capacity of 600,000 tons a year. At the same time, we started works for the fourth line of the San Vittore WTE, which will be up and running next year.
As to operational efficiency, we launched a number of projects in the field of robotics and optimization of plants, which will give us results in the next few years. We are the only water utility in the steering committee of the Piano Mattei plan, thus being able to expand our presence abroad. We have been awarded the tender for a project aiming at planning water infrastructures in the capital of Congo, Brazzaville. Moreover, in the water business again, the acquisition of Aquanexa, which is a platform of water services. Well, this acquisition will help us to manage in a more efficient manner water resources and help us to further consolidate our competencies in this business. Now, let me move to the next slide. Here we are focusing our attention on the main drivers of our growth over the past three years.
First of all, people. For the first time, we have been able to get among the top 20 employers in Italy. This is a very important recognition, which I believe recognizes the commitment that we have taken to improve the well-being and the growth of our people. We strengthened the programs devoted to talents and talent growth, and we signed an agreement with the Luiss Business School for a corporate master and a talent program involving 84 colleagues. We have managed in a very structured manner the generational turnover for the period 2023-2025. The group invested considerably on systems by accelerating digital innovation, robotics, also by the launch of Aquanexa, a company with which.
We reached agreement with the Istituto Italiano di Tecnologia, the Italian Technology Institute, for the creation of a joint lab devoted to robotics. We have then experimented a number of use cases with artificial intelligence with 12 different technology partners. In the field of cybersecurity, we implemented a digital resilience plan which aims at safeguarding and protecting our infrastructures which are now critical, and we are now aligned to the requirements of NIS2 regulation, strengthening the digital resilience of the infrastructure for which we operate. As to processes, we set up an evolution, a new structure devoted to the centralization and optimization of services, and we have defined a new energy transition plan of the group, which guides our strategy towards a more sustainable model also from an energy point of view.
As to credit, we have introduced a new management process which led to a considerable improvement with an increase of collections by 26% versus 2022. I believe another major step was the update or renewal of the brand identity through which we have redesigned the whole digital ecosystem as well to make it more modern, more recognizable, and consistent with the transformation which is now ongoing. I believe that such results over the past three years are not merely isolated initiatives but they are the result of a structural change of the group, and which makes ACEA continue along this direction going forward. This is something that we are building on to allow ACEA to grow in the future. I'll give the floor to the CFO, Valentina Bragaglia, who will give you the details of the results.
Thank you, Fabrizio, and good afternoon. Let's start from the regulatory and market context. Here it is important to remind you that in the water business, ACEA was awarded bonuses for technical quality and contractual quality for EUR 36 million. The update of the WACC for 2026, 2027 has seen a considerable stability, and therefore we are around 6.1%. As to electricity distribution, there was no activation of the return on capital trigger for 2026, and therefore the remuneration on invested capital remains stable at 5.6%. As to commodity prices, electricity and gas prices in 2025 went up by 6% and 8% respectively versus the previous year.
It is well known then that interest rates over the last quarter confirmed the trend recorded in the first nine months of 2025, with a decrease of average rates versus 2024. Now, let me move on to the highlights of our group, of the results. The group results are strongly growing in all economic indicators, thus confirming the soundness of our financial strategy and the effectiveness of our strategy. As the CEO said before, the approval of results for the first nine months of 2025 in line with the international accounting principles, the Acea Energia perimeter were classified taking into account discontinued operations.
We then exposed the pro forma results simulating the deconsolidation of discontinued operations and of Acquedotto del Fiora, which occurred in the first nine months of 2024. Now, considering that the CEO has already outlined the main results of 2025, I'll briefly talk about the net profit and operating cash flow. Net profit, EUR 481 million, which is an all-time high, and it is up 49% versus the previous year. This is also due to the capital gains achieved following the dispersal of the high voltage network to Terna. The net profit is also growing by 15% versus the previous year, and this follows the dynamics recorded at operational level.
The operating cash free cash flow is positive at EUR 26 million, thus allowing us to maintain a sound financial structure with a NFP/EBITDA pro forma ratio equal to 3.28. Next slide, we see the main indicators of the dynamics, and you can see all results are growing strongly. As to EBITDA, Acea concluded the year with a growth of 8% versus the results of 2024, adjusted for one-offs and changes in the perimeter. CapEx net of public subsidies are equal to 1.2 billion euros, of which EUR 68 million related to activities which are being disposed. Net of discontinued operations of Acea Energia, investments or regulated CapEx represent 9% of the total.
Net profit, which includes the contribution of discontinued operations, goes up by 15% on a return basis and which reflects the very good operational performance. The financial position is basically stable, and this allows us to maintain a debt/EBITDA ratio stable. Well, let's now move on to the next slide where we can see the EBITDA. Now, in 2025, gross operating margin recorded an organic growth by EUR 108 million versus 2024. The main drivers here are the tariff growth and the operating efficiencies in the water business. The contribution of the grids and public lighting, which thanks to investments are growing, and the increase of production, both because of the price dynamics and because also of higher volumes produced.
On the right, you see the main one-offs and change in perimeters, EUR 38 million in 2024 relating to the recognition of previous tariffs referred to 2022, 2023, which were recognized in 2024. As to 2025, the one-offs relate mainly to bonuses for technical and contractual quality that we mentioned at the beginning. Now, as to the recurring net profit, the growth equal to EUR 14 million is due to a higher operating performance and also thanks to the financial management which is stable year on year. As to the EBITDA, here you can see on the slide on the right, the one-offs which shows the most important one, which is the disposal of the high voltage transmission for EUR 100 million.
Now, let's move to the next slide, the CapEx, considering the contribution of Acea Energia in the first part of the year. In 2025, we invested EUR 1.5 billion, up 6% versus 2024. Of such investments, 91% are referred to the regulated business, water, grids, and environmental. Net of the perimeter of Acea Energia, that is the operations subject to disposal, the contribution to regulated business to total CapEx was equal to 94%. Now, here you can see the main initiatives that were undertaken in the year, among which the widening of the water and sewage pipelines and the strengthening of the distribution network for electricity.
Now, here you can see the cash flow, which is equal to EUR 19 million in 2025, which reflects the CapEx, the payment of dividends and taxes. As to M&As, EUR 267 million that you see on the slide show, among other components, also the cash-in by Terna, the amount of money for the disposal of the high voltage network, which was equal to EUR 227 million, whereas the cash-in of the added contribution is expected in 2026. Here you can see the financial structure, and you can see that the average cost of debt in 2025 was 2.07% versus 2.60% of the previous year.
The cost of debt is also affected partially by the reduction of variable rates connected to the Euribor, which is such that is around 20% of the total. Here you can see the Acqua Italia results. Let me tell you that the results of 2024 were recalculated because we had to take into account the reclassification of the Acquedotto del Fiora. In 2025, EBITDA, recurring EBITDA, adjusted for bonuses, has gone up by 8%, growing by EUR 58 million. Such dynamic is supported by tariffs growth, CapEx results achieved by the consolidated companies and operational efficiency.
Net of public subsidies, CapEx records a growth by EUR 25 million, up 4% year-on-year and related to investments made on aqueducts and water treatment plant and the maintenance of network, net of the investment related to Acquedotto del Fiora. The yearly growth is EUR 57 million. RAB at the end of 2025 goes up to EUR 5.4 billion. Let me now move to slide 18, where you can see the grid and public lighting business. Despite the reduction of WACC by 40 basis points in 2025 versus 2024, recurring EBITDA rose by EUR 32 million - EUR 457 million. The main drivers are CapEx carried out and the update used to reevaluate RAB starting in 2025.
CapEx and net of public subsidies around EUR 312 million in 2025 is growing by 5% versus 2024. RAB is stable at EUR 3.1 billion versus 2024, and this is due to the disposal of the part of the high-tension high voltage network. Now let me move to the environment business. Here, net of one-off EBITDA grows by 6% year-on-year, and this result is related to higher margins of the WTEs. CapEx in this area are growing by EUR 8 million year-on-year. Let me remind you that in 2024, CapEx included the effect of the WTE Terni revamping operations. Here is the production business.
The recurring EBITDA grows by EUR 12 million because of the more favorable energy scenario and the greater production coming from hydroelectric and photovoltaic plants. The energy produced or generated goes up by 18% thanks to hydroelectric and photovoltaic business. In 2025, CapEx were EUR 33 million, up EUR 8 million versus 2024. As to 2026 guidance, all EBITDA is envisaged to grow between 3% and 5% versus the 2025 restated.
Restated, considering the one-offs and the change in the perimeter that we talked about before, and excluding the contribution of the high voltage grid, and then disposed of in 2025, and photovoltaic plants disposed of in 2025, and then Publiacqua, which is now to be disposed. As to 2026 EBITDA, here we have not taken into account the contribution of Acea Energia, which is to be disposed. We have included the contribution of Aquanexa, considering the deal will be closed in the second part of the year. As to net debt to EBITDA ratio, the guidance is between 3.5 and 3.6 times.
Thank you. The presentation is now over. We can now start the Q&A session. Thank you.
Thank you very much. This is the conference operator. We can now start the Q&A session. Anyone who wishes to ask a question may press star and one on the touchtone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who wishes to ask a question may press star and one at this moment. Now, the first question by Francesco Sala, Banca Akros.
Good afternoon and congratulations for your results. First question about the 2026 guidance. I wonder whether it includes subsidies or bonuses for the water business or whether it doesn't. Second question, again, about the water business.
What is the average tariff increase envisaged for 2026 for the water companies? Now another question about the hedging policy. How much energy have you already sold forward? Could you tell us something about 2026 and perhaps 2027? Can you give us an update about the works on the Peschiera aqueduct? Where do we stand there? Thank you.
No, thank you very much for these questions. Start from the first question. In the 2026 guidance, as usual, we have not included any bonus for technical and contractual quality. The guidance includes an average of the growth of water tariffs by 6%.
As to Peschiera, the tender should be awarded in April, so this is state of the art at the moment. As to hedging policy, well, we are monitoring the situation very carefully. At the moment, we have an exposure of EUR 3 million of EBITDA for each increase of the ton of energy. We are monitoring the market constantly for this purpose.
Thank you. The next question, Javier Suarez with Mediobanca.
Good evening, then, ladies and gentlemen, and thank you very much for your presentation. I have a few questions to ask as well, if I may. Now, the first is a more conceptual or strategic question.
Now, the company has gone through a transformational change during the year, and now the company is very much focused on regulated business. Now, in your guidance, the EBITDA goes up to 3.6%. I wonder whether you can speak about the company from a structural point of view and about the possibility to grow debt. What is the level of debt that you can reach considering the structure that you would have in 2026? Now, second question is about the dividend. The dividend, as you said, is growing quite strongly. This is related to the capital gains achieved from the disposal of the high voltage and grid sold to Terna.
Now, in 2026, you will also have capital gains related to the disposal of the supply business. Now, will that capital gain be part of your dividend policy in 2026? I'd like to have some indication of 2026 below the EBITDA. Now, the consensus I see is around EUR 350 million net income in 2026. Do you feel comfortable with this guidance for 2026? What's the impact of the energy decree that has been approved by the government? Thank you very much for your questions, Javier. Let me start from the energy decree.
Now, the growth of 2% or by 2% of ARERA will have an impact of EUR 6 million for us. This is regulated business. We have to see the evolution to actually answer your question. As to the PUN, the change here can be estimated around 30-35 MWh. And this will have an impact of some EUR 10 million. However, it is included in our guidance because it is a very well-known factor in this moment. There is something which is related to the payment of the ATO money by the distributor. This will be absorbed. As to dividends, now, as you heard, we approved extraordinary dividends because of capital gains and results.
Next year, we will have capital gains, as said here. Well, the only known element is the dividend policy at the moment. If we have to update it, we should see it next year. As to debt, well, the fact that we now are a player focused on regulated business, well, this helps us. Now, at the moment, our threshold debt is around 3.7-3.8. Because of the change of the perimeter of the business, we expect this will change, but we need to wait for the approval of the industrial plan, and then we should have to see what the rating agencies say.
As I say, the approval of the master plan here is what can help everyone in this direction. As to the guidance, we do not give any guidance below the EBITDA, but let me say that we do not expect any discontinuities below EBITDA. Now, the next question by Roberto Letizia with Equita. Now, good afternoon, and thank you very much for your presentation. I have a question about the debt guidance. While CapEx going to be more or less the same as last year, CapEx is going to be quite high, EUR 1.5 billion gross or EUR 1.2 billion net. Is this a level of CapEx which is going to be structured as a level?
Well, this helps us to understand the sustainability of the debt going forward. Then again, about debt. Are there any special considerations about changes of the working capital for 2026? The change in the debt guidance, does it include also the money collected in the water business? Just wanted to understand how the mechanics work here. Now, as to the restructuring of the group, I wonder whether in 2026 also because of the acquisition of Aquanexa, are there going to be M&A deals thought similar to Aquanexa?
I'm just asking this question whether 2026 we will have M&A surprises or whether you are cautious about M&As in 2026. The sensitivity of the prices of energy. Is that a sensitivity of the group or related only to power generation? Well, we know that there are increases in the procurement prices. I wonder whether the sensitivity that you gave us is an upside only for the power generation or considering the net effect on generation, we might have also the effect of the growth of procurement prices. Now another question of dividends. Can you tell us the capital gains that you expect in capital in 2026 so that we can then run our models for dividends?
Another question about the distribution companies. Thank you. Let me start first of all from the question on M&As. Now, ACEA as a group has an asset rotation which was completed in 2024. Now, as to further growth through acquisitions, well, as top managers of the group, we need to see whether there are opportunities in the market, and if there are opportunities, we need to grasp them. Our growth, however, is also related to a very strong organic growth in our businesses. The acquisition of Aquanexa is certainly a first step. Through Aquanexa, we acquired a unique platform in the water services.
This certainly helps us to grow organically, but it could also help us to see whether we can acquire other competencies which are becoming very important considering that networks are to become more resilient and more safe. Now, as to the internationalization, for instance, the contract for the planning of our water business. Well, certainly there might be some operations internationally, but as I said, this is related to opportunities coming up on the market. Now, Valentina will answer the other questions. As to the debt guidance, this does not include the disposal of one of the company in the water business. Now, we know that this company is to be disposed of, but we at the moment are waiting.
As to the working capital, well it is certainly positive. We certainly are to also cash in the money as a result of the equalization of the bills. As to CapEx, now with the approval of the ARERA plan, we will be able to give you a clearer indications. Now, please remember that with ATO two, well, this helps us to plan CapEx and also consider what it takes for the power distribution. When I talked about the sensitivity, that was only related to the power business, but during the year, we do not expect further impacts. Now, considering the procurement strategy, in 2026, we do not believe that in 2026, there will be major material changes.
We might have some impacts on the financial position in the water business, but nothing that can change our guidance in an unexpected manner or in a manner which cannot be managed. As to the capital gains, we should see when such capital gains are cashed in, the level would be quite high.
Now, last question about the concessions. There we are waiting for the approval of the ARERA decree. At the moment, we do not have the visibility in order to give you a greater or more ideas about this. The next question by Emanuele Oggioni at Kepler Cheuvreux.
Good evening, and congratulations for your results. I have a few questions. The first one is related to the management change.
Now, in the press, we constantly read that the top management of your group is going to change. Can you please make a comment about this? When are you going to update your business plan, considering also the change in the perimeter of your group? Another question about the investigation of the antitrust authority related to the disposal of a company to Plenitude. Can you tell us something about this? You said the whole thing is going to be closed, you know, before the end of the first part of 2026. As to the tenders in the water business.
Now you in Italy won almost all of the tenders that were published in previous years and in 2025. I wonder which tenders are going to be issued or published in 2026, and if you can give us further visibility about this, and whether there might be something relevant about volumes above the strategy, which implies moving towards new areas. But is there going to be a contribution to EBITDA? Again, about the water concessions. Now, the budget law mentions the possible extension by 10 years of the main concessions for ATO two until 2032, but also for the subsequent 10 years. Can you give us more details about this? A very last question, if I may, about the synergies that you expect from Aquanexa.
Now, how much can the EBITDA go up thanks to these synergies in the first two years, let's say? Now let me answer your questions. Now, the disposal of the supply business to Plenitude, as you read in the press release, we have approved, we have received approval of the AGCM. This means a slight change in the parameter of Acea. Acea will continue to manage the market of safeguarded or failed people. This review of the enterprise value in a meaningful manner. Revision of the enterprise value below 3%. As to the industrial plan, as we said often, now the company is ready to present the industrial plan to the market.
Now, we are at the end of the mandate of the members of the board, so we'll wait for the review of the board of directors. Now, the budget law has approved the extension of 10 years the concession that we have in Lazio. We need to submit our CapEx plan, but this is very important. There is also the plan on the part of the government to extend the concessions in the electricity business by 30 years. The company is ready. The guidelines that we are to follow are very clear, and we will be more precise as to the new industrial plan going forward. Now let me move forward to Valentina, who will answer the other questions.
As to tenders, we know that the competition dialogue was completed for the Viterbo tender, which envisages CapEx by EUR 2 billion. We are now waiting for the start of the third stage. Invitation letters will be sent, will be published. In 2026, we expect that a tender will be published for the management of the integrated water service in North Naples. Here we are seeing also a number of small initiatives related to public-private partnerships.
Well, let me step in, for the FY year, we expect in the second quarter of this year, we expect to complete the acquisition that Valentina mentioned. We cannot give you figures in this moment. Certainly, there will be any synergies.
At the moment, we are not customers of Aquanexa, but since we have a 16% market share in the water business, we are the main player in Italy here. Well, Aquanexa could certainly be able to get some contracts, and there will be certain synergies that we can capture, innovative technologies, services which are more connected to the quality and the use of the water resource, which can also help us expand our business or grow our business. Now, as a reminder, if you have any other question, you may press star followed by one on your touchtone telephone. Ladies and gentlemen, we do not have any other question in the conference call. Well, then, thank you very much for taking part into this presentation. Thank you and have a nice day.
This is the Chorus Call operator. The conference is now over. You can now disconnect your phones. Thank you.