Message from the Executive Chairman of the Board
In a difficult 2022, sound results exceeded expectations

Foresight in tackling the new scenario and confidence in the solidity of the business model: by leveraging these two strengths, Hera faced the challenges of fiscal year 2022, making progress in all financial KPIs.

The purchase of significant amounts of gas, to have adequate stocks available against the threatening energy crisis, was an intuition that has allowed the Group to keep its risk profile under control while continuing with the execution of the investment plan that underpins the continuous business growth.

The healthy results – achieved while maintaining a balanced leverage – make it possible to remunerate shareholders with a dividend of 12.5 euro cents per share, which represents a yield of about 5%.


Dear Shareholders,

2022 results, which the Board of Directors approved today, were above expectations. In a very challenging context, we have tested once again our multi-business model, proving its full effectiveness. This allowed us to achieve increasing results starting from the P&L top line, down to the bottom line, as showed by the 6% progress at EBITDA level, which resulted in a 1% increase of the Adjusted Net Profit.

The reaction to the threats from the scenario: “à la guerre comme à la guerre”

After we had to cope in 2020-2021 with the pandemic, in 2022 we had to face the consequences of the war in Ukraine and the persistent disruptions in the supply chains, while the Central Banks sought to fight inflation with a sudden monetary tightening. Such an environment has added elements of uncertainty to the fragile outlook for economic recovery.

With the aim to manage the possible impacts of the energy crisis, we promptly decided to purchase large quantities of gas to be withdrawn from storage over time. The aim was to meet demand from our customers and ensure continuity to our energy-consuming operations. An extraordinary measure, to face times of war.

With the decrease in gas stocks, deleveraging also began

With the start of the thermal season, these inventories began to fall: from 878 million euro of stored gas value at the end of September 2022, we have now dropped to 508 million euro at the end of the year. The destocking of acquired gas, which started in the fourth quarter – and which has already brought a visible benefit in terms of decrease in net financial debt as at 31 December 2022 – then continued, leading us towards a complete stock-out at the end of the first quarter of 2023.

Investments continued, in line with the Business Plan, while risk remained under control

The capital strength we could count on at the beginning of 2022 gave us the flexibility to manage the risk of the energy crisis leveraging on these extraordinary gas purchases, while we continued to fuel business development through new investments.

In 2022, capex absorbed 687 million euro, an amount 21% higher than in 2021, while we invested 131.5 million euro in M&A transactions.

On the operating investment front, therefore, we managed to carry out the projects planned. While coping with the difficulties due to the disruptions in supply chains and inflation, we also completed the revamping of two Waste-to-Energy plants. On the external growth front, we continued to strengthen our presence in the Energy and Waste areas through some acquisitions. The closing of an additional deal whose negotiations started in 2022 – the one with ACR Reggiani – took place in the beginning of 2023.

The Debt-to-EBITDA ratio reached a peak at 3.62x at the end of September, before the start of the thermal season, while at 2022 year-end it was down to 3.28x. If we adjust this indicator for the impact of storage, we see that, excluding such temporary investment in gas, we would have remained below the 3x threshold that we consider conservative under normal conditions.

Sustainability businesses and organic growth drove the 76 million euro increase at EBITDA

In the quite extraordinary scenario in which we had to operate during 2022, we put several levers into action to favour a continuous EBITDA growth along the uninterrupted path started in 2002. We knew that we had to counterbalance the negative impact on regulated businesses from the WACC cut made by ARERA, effective from January 2022. In the past financial year, we had a 22 million euro reduction of EBITDA due to the regulatory review.

However, Hera could count on the strong expansion in businesses where the Group plays a role as enabler of sustainability. These businesses drove the growth of consolidated EBITDA with a total of 44 million euro: energy efficiency activities and the façade bonus contributed for 19 million, Aliplast’s plastic regeneration activities for 17 million, while Value Added Services for other 8 million.   

An equally important contribution, of 45 million euro, came from organic growth, pushed by the expansion in the Energy markets and by growing volumes and prices in the liberalised segment of the waste business, as well as from increased operational efficiencies made possible by continued investments.

Finally, in 2022 we also captured the benefits of the inclusion of the newly acquired companies in our consolidation scope, with an incremental contribution to EBITDA amounting to 8 million euro.

Despite a very unfavourable context, Hera managed to stay on the development path envisaged in the Plan, delivering sound results while keeping its risk profile under control.

Shareholders benefit from the value created through the distribution of a higher dividend  

In the light of these results, the Board of Directors will propose to the Shareholders’ Meeting that will be held on the next 27 April to approve the distribution of a 12.5 euro cent dividend per share, up by 4% compared to the 12.0 euro cent of FY2021. If calculated considering the share price at the end of 2022, equal to 2.52 euro, the 2022 dividend yield is close to 5%. Thus, we conclude two decades of the Group’s history, providing our shareholders with a return that allows them to benefit from the value that Hera has created, even in this difficult financial year, and ensuring a good start for the new Business Plan 2022-2026.

Tomaso Tommasi di Vignano
Tomaso Tommasi di Vignano
21 March 2023
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