Ladies and gentlemen, thank you for standing by. Welcome to today's Turner's Nine Months twenty twenty Consolidated Results. At this time, all participants are in a listen only mode. I must advise you that this conference is being recorded today, Wednesday, 11/11/2020. I would now like to hand the conference over to your speaker today, Agostinos Gonojenki, CFO.
Please go ahead.
Good afternoon and welcome to Terna Naimon's twenty twenty Results Presentation. As you can appreciate from this chart, the first chart is Page four of the presentation that you should have. In the first nine months of the year, due to the COVID-nineteen health emergency, national demand was two twenty five terawatt hour, 6.9% lower versus the same period of 2019, where the national demand was about two forty two terawatt hour. Despite this situation, let me highlight that starting from the month of July, we started to register a recovery with the monthly flat demand in September compared to September 2019. Let me also underline that in the first nine months of the year, renewable sources scored about 40% of the total demand compared to 35.7 in the corresponding period of 2019.
Concerning national net total production, they stood at two zero six terawatt hour with a strong increase registered in solar and hydro generation, which grew by 84% respectively versus the same period of last year and confirming the strong growth trend for renewable in Italy. Despite the challenging situation on the electricity market caused by COVID-nineteen, Terna continued to manage the grid and ensuring a high quality of service and high quality and high security of supply. Now let's move to the main figures of the period at Page five. In the first nine months of the year, group revenues and EBITDA were up by 74% respectively, which means 115,000,000 and $45,000,000 higher than last year. Moreover, we reported the group net income of $569,000,000 $17,000,000 higher versus last year, while group CapEx stood at $749,000,000 12% more versus September 2019, confirming the strong CapEx acceleration even in this challenging scenario of emergency.
To support this massive CapEx acceleration, our net debt stood at $8,800,000,000 versus about 8,300,000,000.0 at year end 2019. And now let's make a deeper analysis of the figures. Let me start with revenues analysis. Total revenues in the first nine months of twenty twenty increased by 6.9% reaching seventeen eighty one million dollars up by $150,000,000 versus the same period of last year. The growth was mainly attributable to regulated activities, which contributed for more than $27,000,000 Moreover, I remind you that from the last quarter we consolidated the new inquiry Brook Tables for which the closing was signed in February.
Let's now go into the details of the regulated and non regulated revenues evolution. Moving to the next slide. Regulated revenues reached $1,545,000,000 dollars $27,000,000 better than last year. This increase reflects tariff solution driven by our investment activities, while other regulated revenues increased by $5,000,000 mainly as a consequence of higher revenues related to quality of service. Non regulated and international revenues reached $236,000,000 about 60% higher than last year.
This growth was mainly due to the already mentioned integration of group cables. Now let's go through operating cost analysis and on Page nine. As shown in the chart, total operating costs stood at $457,000,000 18% higher than last year. The increase was mainly attributable to group consolidation. For a deeper analysis of the group's OpEx component, let's turn to the next slide.
Starting from regulated OpEx, we reported $294,000,000 substantially in line versus last year despite the strong increase of our asset base and some extra costs related to the COVID emergency. Non regulated and international operating expenses amounted to 173,000,070 million dollars more than last year, mainly due to the Book Cable integration. Net of this perimeter effect, non regulated and international OpEx were substantially in line versus last year. Let me now analyze EBITDA. Moving to the next slide.
Considering the above mentioned effects, Group EBITDA reached $1,323,000,000 dollars $45,000,000 better than last year. We registered a positive EBITDA contribution both from regulated and non regulated and international activities, which grew by 27,000,000 and $18,000,000 respectively versus last year. This increase was mainly attributable to higher regulated revenues as well as to the contribution coming from Brook Cable acquisition. Let's now have a look to the lower part of the profit and losses. Turning to the next slide.
I am now at Page 12. Depreciation and amortization amounted to $458,000,000 last year was mainly due to the impact of new assets becoming operational in the period. As a consequence, EBIT reached $865,000,000 $23,000,000 higher versus the first nine months of twenty nineteen. We reported net financial expenses of $70,000,000.9000000 dollars higher than the same period of last year mainly as a consequence of the lower capitalized financial charges and the adjustment of the valuation of equity of some equity investment in associated companies. Taxes stood at $223,000,000 $4,000,000 lower versus last year due to high income not relevant for tax purposes recognized in the period.
As a consequence, tax rate stood at 28% versus 29% of the first nine months of twenty nineteen. Consequently, the group net income reached $569,000,000 $70,000,000 higher versus the same period of last year despite higher depreciation and amortization level linked to the business acceleration of the period. Moving to CapEx analysis. For the first September 2020, total CapEx amounted to $749,000,000 12% higher than the same period of last year confirming Terna's brief ability to pursue its objectives despite the nowadays emergency context. Indeed, we invested about $7.00 $5,000,000 in regulated activities.
Among the main projects of the period, it is worth mentioning there was to increase exchange capacity between the different market zones in Campania and Sicily. The rationalization of Naples Metropolitan Area as well as the progress on construction site for the Italy France interconnection. Among CapEx categories, development CapEx represented 35% of total regulated CapEx, asset renewal and efficiency was 48%, defense represents 70%. Non regulated and other CapEx stood at $45,000,000 which includes capitalized financial charges and dollar investments. Regarding net debt and cash flow 100 analysis, net debt at the
September 2020 was 8,025
million dollars $566,000,000 higher than 20 nineteen year end level and mainly as a consequence of the CapEx acceleration made on National Grid. Let me say that on working capital side, we confirm that during the COVID emergency we registered no relevant delays on cash settlements. There was no issue with bad debts. Moreover, the working capital increase shown in the chart was related to the increase of market payments connected to the uplift evolution that will progressively normalize in the coming months. Let's now make a deeper analysis of our debt profile at Page 15.
Our debt management approach is aimed to keeping a high level of efficiency and a solid financial structure, potentially mitigating any potential financial risk. Indeed, at the end of the period, we registered a fixed over floating ratio on gross debt of about 84% and an average duration of about five years. Regarding the proactive debt management activities delivered as usual also in this period, let me remind you about the bond issue made in September for €500,000,000 with a duration of ten years and a coupon of 0.375%, the lowest for an Italian corporate bond with this duration. This bond followed the green bond launched in July for a total nominal amount of €500,000,000 and an actual cost equal to 0.78% confirming our absolute leadership in the sustainable financial market. Finally, it is worth mentioning that at the October, Standard and Poor's affirmed the long term corporate credit rating on Terma at BBB plus, one notch above the sovereign rating, while revising the outlook of Terma to stable from negative.
At the same time, the agency also affirmed Terma's standalone credit profile at A- and you remember that this decision follow a similar decision on the rating of the Italian Republic. To conclude this presentation, I would like to remind you that on November 19, we will present the new industrial plan. Moreover, we also remind you that on the November 25, we will pay the 2020 interim dividend of €0.90 per share as decided in the Board of Directors of today. So thank you very much for your attention. We are now ready for the Q and A session.
Thank you. Ladies and gentlemen, we will now begin the question and answer session. Your first question comes from the line of Harry Wyburd from Bank of America. Please ask your question.
Hi, good afternoon, everyone. I appreciate that you'll be taking the sort of big issue questions next week. So just one from me. I understand that the regulatory review process has formally And I think you and your peers have said fairly consistently over the course of this year that the formula as it stands implies no change to the allowed return.
But if I'm not wrong, I think the formula is due to be reviewed under the current regulatory review. So I'm just interested in your thoughts as to what the timeline, firstly, of the regulatory review process will be from here? And then specifically, whether you envisage any changes to the formula for how the allowed return is calculated?
Well, in general terms, as you know, according to current rules, the 5.6 WACC has been set until the 2021. Regarding the post 2021 walk update, the process just started with the resolution published only a few weeks ago. The document was pretty general and it refers only to the overall regulatory principle without entering in any specific detail. But we can say that the resolution highlights the intention of the regulator to operate in full continuity with past methodology in order to preserve the stability of regulatory framework. This is something that as you know is of the mandatory importance for us.
For what concern the duration, the document indicates that the new Wachi Qi period will last at least for four years maintaining the principle to have an interim review to adjust eventually the parameters in accordance with some evolution of the macroeconomic scenario. So to make a long story short, expect to have a little bit more visibility in the 2021, maybe in between the yes, let me say in the 2021. But again, we expect full continuity in the principles.
Okay. Thank you.
Your next question comes from the line of Javier Suarez from Mediobanca. Please ask your question.
Three questions also on the third quarter numbers. The first one is on the CapEx that I think it has been a surprise, the level of CapEx that is ahead of expectations, I guess. So the question here is that if the company what is behind that increase of CapEx? If the company feels an improvement in the overall process for administrative approval for new investment, if that is something that is happening and you as a company are feeling that tailwind coming from less of a heavy administrative burden? That is the first question.
The second question is on also taxation during so far this year looks a little bit lower than expected. If you can help us to understand the level of taxation by the year end. And the third question is on the cash flow statement on Slide number 14. There is a working capital negative impact of €350,000,000 If you can help us to understand where that number should be by the year end? Thank you.
So thank you, Javier, for your questions. So let me start from the first one. Nothing magic behind the evolution of the CapEx only, let me say, an impressive huge commitment, a huge sense of belonging to the team demonstrated from our operational people. They did something really exceptional. Given that in nine months, we had basically two months in which the country was completely closed.
We were not obliged to stop our jobs, our works, our realizations. The problem was the logistics in the country. Was not possible to move for providers, for our suppliers, for our technicians in the different area of the country. So the team demonstrated huge flexibility. They of course were obliged to postpone some activities, but they also decided in the meantime to reschedule other activities in order to cover with something else what was missed.
So at the very end, the fact that we are able to show an increase of 12% respect the same period of 2019 and if you compare also the figures with our internal expectation, we are full in line with our internal expectation at the September. But again, they basically worked seven months out of nine because for two months the company was completely blocked. So really an excellent job made by the operational team. Regarding taxation, slight decrease in the tax rate, yes, slight decrease in the tax rate from the average 29% to 28% is mainly related to non taxable items, non recurrent non taxable items. So we expect that in the long term nothing will change.
Last question on cash flow. Due to the nature of this figure, on one side the positive effect of our net debt registered in the last year has started to be resulted. In particular, with reference to net energy related pass through payables during these months, there has been an increase in the cost of service against the lower cost of energy and the lower demand of energy. Saving other terms, we were obliged to buy on the market ancillary service in a particular part of the period in which we had a lot of very, very low demand, a lot of renewable generation. So a lack of stability service on the system.
We were obliged to buy for this, so we pay for this. And on the basis of the agreement that we have with the authority, this cash out will be compensated by corresponding cash ins from the distributor in the coming months. So it will be reabsorbed, but we expect by the 2021.
Thank you.
Your next question comes from the line of Stefano Gambarini from Equita SIM. Please ask your question.
Good afternoon, everybody. Three questions from my side. The first regarding what happened during the summer in the renewable sector. Are you experiencing an acceleration of demand for new connection from this sector as well? And are your CapEx also related to this acceleration?
Or at the end of the day after the lockdown no main changes on this point of view happened? The second regarding the financial charges, could you elaborate a little bit more what happened in the third quarter with these higher financial charges? And if you have a guidance for the full year? And the last one, just if you can remind us the main guidance for full year in terms of EBITDA, CapEx and net debt? Many thanks.
So regarding the first question, we this is something that we will discuss more and more in detail along the 2019. What I can anticipate here is that yes, we had a lot of additional new requests for connection coming from private entrepreneurs that are investing in renewable. And no, there is not a direct connection for the time being for the CapEx we last because in any case we were talking about CapEx that were already planned for 2020. Of course, will be not the case for the future because in the future a relevant part of our business plan will be connected with the increase of renewable in the system. The second question was related to net financial charges, okay?
We are talking about an increase of €90,000,000 that is connected to two main items. The first one is that we have less capitalized financial charge for a reduced capitalization rate. And the second one is that we decided some adjustment in valuation of investment in some minor associated company. But in any case, we are talking about a one off impact of low single digit, not irrelevant. The third one.
For the guidance, yes, of course. We are going to confirm the guidance already communicated last March. So we will confirm 2,490,000,000.00 of revenues, 1,790,000,000.00 of EBITDA and EUR 1,300,000,000.0 of CapEx. Yes. So all the other, we confirm everything was communicated already.
Nothing changed. Okay. And let me add that this is a really impressive demonstration of the resiliency of our business model because what happened in 2021 and what is still happening unfortunately is something that has a massive impact on the economy. But if you look to the September figures, they are basically COVID free. Thank you.
If there are no further questions, I will hand the conference back to your speakers.
Well, really thank you for your time. And let's have additional conversation on 2019 in which we will dedicate all our attention and all our effort have a good presentation of our business plan update for twenty twenty one-twenty twenty five. Thank you very much.