Net debt

Net debt was a negative 2,495.5 million euros as at 31 December 2012, marking an increase of 169.6 million euros compared to 31 December 2011.

The breakdown is shown in the following table:

CONSOLIDATED NET DEBT 31.12.2012 31.12.2011 Increase/ (Decrease)
Non-current financial assets/(liabilities) 2.1 1.9 0.2
Intercompany non-current financial assets/(liabilities) 30.9 18.0 12.9
Non-current borrowings and financial liabilities (2,211.6) (2,298.9) 87.3
Medium/long-term borrowings (2,178.6) (2,279.0) 100.3
Cash and cash equivalents and securities 423.8 321.1 102.7
Short-term bank borrowing (753.9) (448.9) (305.0)
Current financial assets/(liabilities) (56.9) (26.8) (30.1)
Intercompany current financial assets/(liabilities) 70.1 107.7 (37.6)
Net short-term debt (316.8) (46.9) (270.0)
Total net debt (2,495.5) (2,325.8) (169.6)

The increase in net debt is the result of funding needs deriving from management of working capital, as well as investments, particularly those made by ACEA to purchase the registered office (100 million euros) and by all industrial areas.

The individual components break down as follows.

Medium/long-term borrowings are composed of:

  • non-current financial assets/(liabilities) amounting to 2.1 million euros, essentially in line with the figure recorded in the comparison period (1.9 million euros in 2011),
  • intercompany financial assets / (liabilities) of 30.9 million euros, and include financial receivables due from Roma Capitale relating to plant upgrades in terms of safety and legislation and new constructions as set out in the addendum to the Public Lighting contract. This receivable refers to the long-term portion due following application of the financial method as envisaged in IFRIC 12 on Service Concession Agreements and increased by 12.9 million euros compared to 31 December 2011,
  • non-current payables and financial liabilities, which total 2,211.6 million euros and can be broken down as shown in the table below.
€ millions 31.12.2012 31.12.2011 Increase/ (Decrease)
Bonds 1,011.1 988.7 22.5
Medium/long–term loans 1,200.5 1,310.3 (109.8)
Total 2,211.6 2,298.9 (87.3)

This reduction was caused by the drawdown of the second tranche of the loan taken out from the EIB in 2009 for the purchase of the registered office, in the amount of 100 million euros, and the reclassification of a 200 million euro loan, falling due on 4 August 2013, to “short-term borrowings”. The drawdown of the second tranche of the EIB loan, completed on 23 January 2013, refers to the loan that was granted by the bank in two tranches of equal amounts. The characteristics of the first tranche are those of a loan granted directly to ACEA without security in the form of a bank guarantee (Direct Loan). The second tranche also has the characteristics of a direct loan to ACEA, but with a back-to-back guarantee from a leading bank acceptable to the EIB (Guaranteed Loan). Repayment of the principal will be in equal half-yearly amounts from 15 December 2015 until 15 December 2026.

The amount of the fair value of hedging derivatives for long-term borrowings is negative by 41.3 million euros, while it was a positive 11.1 million euros as at 31 December 2011. 

The breakdown of non-current financial liabilities is shown below, including fair values of hedging derivatives, by Industrial Area:

Industrial Area 31.12.2012 31.12.2011 Increase/ (Decrease)
ACEA 1,684.8 1,784.4 (99.6)
Networks 343.1 363.7 (20.7)
Water 179.1 144.5 34.6
Environment 4.6 6.3 (1.6)
TOTAL 2,211.6 2,298.9 (87.3)

Bonds

Bonds equal 1,011.1 million euros and include the instruments already existing at the end of the previous accounting year, in particular:

  • 306.0 million euros refer to the bond loan issued by ACEA in 2004, with interest of 14.6 million euros accrued in the period,
  • 515.0 million euros (including the accrual of accrued interest due) due to the bond loan issued by ACEA in March 2010 with a 10-year duration and maturity term on 16 March 2020. It should be noted that the interest accrued is 22.5 million euros,
  • 176.5 million euros relating to the Private Placement which, net of the fair value of the hedging instrument, a negative 10.8 million euros, amounts to 187.3 million euros. As at 31 December 2012, this fair value was allocated to a specific shareholders’ equity reserve. The exchange rate difference, a negative 10.9 million euros, of the hedged instrument calculated at 31 December 2012 was therefore allocated to an exchange provision. The exchange rate as at 31 December 2012 stood at 100.13, whilst it stood at 100.22 as at 31 December 2011. It should be noted that the interest accrued is 2.4 million.
  • 2.8 million euros regarding the issue of the bond loan issued by Consorcio Agua Azul.

 

Medium/long–term loans (including short-term portions)

This item amounts to 1,465.9 million euros, whilst at 31 December 2011 it amounted to 1,384.6 million euros.

The following table shows medium/long–term and short-term borrowings by term to maturity and type of interest rate:

Bank Loans: TOTAL RESIDUAL DEBT DUE BY 31.12.2013 FALLING DUE BETWEEN 31.12.2013 and 31.12.2017 DUE AFTER 31.12.2017
fixed rate 372.4 24.5 86.3 261.6
floating rate 822.8 232.4 392.9 197.5
floating rate to fixed rate 270.7 8.6 66.0 196.1
Total 1,465.9 265.5 542.2 655.2

As at 31 December 2012, the short-term debt was negative, and contributed to the increase of 316.8 million euros in net debt. With respect to 31 December 2011, a decrease of 270 million euros was recorded, caused by:

  • an increase of 102.7 million euros in cash and cash equivalents,
  • growth in short-term bank debt of 305 million euros due to the increase registered by ACEA (135.6 million euros), which stipulated new lines of bank credit, and by Publiacqua due to the reclassification of the loan falling due on 23 May 2014 (24 million euros) from long to short-term,
  • the 30.1 million euro increase in the balance of current financial liabilities caused by: (i) the recognition of payables from the Parent Company’s resolution on the advance on dividends for 2012, intended for the market (+21.8 million euros) and (ii) 37.1 million euros in higher payables due to factors, partially mitigated by the growth in current financial assets, including (iii) receivables from securitisation transactions (+23 million euros) and (iv) receivables generated by the sale of the PV business unit (10.5 million euros), 8 million euros of which has been collected by the end of January 2013,
  • the 37.6 million euro decrease in intercompany current financial assets, mainly as a result of the reduction in ACEA loans and receivables from Roma Capitale for the management of public lighting (-51.4 million euros).