Good afternoon, everyone, and thank you for joining us for full year 2025 performance presentation. Today as speakers, we have Renato Mazzoncini, our CEO, and Luca Moroni, our CFO.

I leave immediately the floor to Renato for the first part of the presentation, and then he will pass to Luca. Thank you.

Thank you Marco, and good afternoon everyone. Thank you for joining us.

We report another year of strong performance and value creation. The key message that we wish to share today is that we are on track, on trend, and on target for shareholder returns.

Let's start from the slides that you can see, slide number two, highlights. Full year '25 results once again demonstrate our strong execution across all our strategic priorities, reinforcing A2A's positioning for sustainable growth and shareholder remuneration.

From an industrial standpoint, in '25, we delivered on a series of key new milestones, fully aligned with our long-term infrastructure investment plan. Our electricity RAB reached €1.7 billion, marking a plus 52% annual increase, gross of perimeter effect, and double-digit organic growth, our capex, our investment.

This results was driven by disciplined capex deployment and the successful integration of newly acquired asset, Duereti. We installed 76 MW of new renewable capacity, including the first phase of Santo Stefano in the northern part of Italy near Trieste.

At the same time, the group is well positioned to exploit the accelerating electrification trend. We completed a major asset rotation from gas electricity networks, focusing on the backbone of the energy transition.

Our supply business unit increased electricity volumes sold by 12%, confirming our ability to capture demand and to serve customers across different segments. We have positioned ourself as an early mover along the data center megatrends in Italy.

You remember, we presented in our industrial plan in November. We launched our data center platform to deliver a fully integrated offering, complementing power supply with land availability, fast grid connection, that is really a killer application, energy-efficient buildings, heat recovery, and water management.

Heat recovery with district heating. Through this platform, A2A positions itself as a one-stop shop for data centers' energy-related needs.

Lastly, our cash conversion rate reached 65%, allowing us to fully fund our investments and dividends, and to improve our leverage ratio at 2.4. Adjusted earnings per share reached €0.22, fully aligned with our guidance, allowing us to safely fulfill the commitment to a 4% year-on-year dividend per share growth.

Slide number three, in which you can see all our numbers, the consolidation of the new company Duereti and the increase in volumes sold in electricity sector, you remember 12% more, led to an increase in adjusted revenues of more or less 9%, €14 billion. The adjusted EBITDA, €2,243 million, decreased by 4% in '25, but only for the hydro production.

If normalized by previous year hydroelectric production, which was 1.2 TWh above the 5-years average, the EBITDA grew by 4%, confirming the resilience of our business model. The same consideration about adjusted group net profit, that was €686 million, net of hydroelectric production normalization is, compared to '24, is the same level.

Our net financial position was below €5.5 billion, thanks to an operating cash flow that guaranteed coverage, as I said, of capex and dividends, as well as cash-in from asset disposal. The leverage ratio was equal to 2.4 times, with a decrease compared to '24.

As slide number four, you can see our capex. The capital deployment is the clearest evidence of our sound execution and our long-term strategic vision.

With almost €1.7 billion in capex, 11% higher than '24, of which €1 billion related to development projects. These project have enabled us to improve the efficiency of power distribution network, accelerate our development path towards renewable energy, enhance the flexibility of generation plants, and strengthen our circular economy business.

Consider that, in particular, in circular economy, imaging waste-to-energy plant, the authorization are not easy to be received, and A2A, in this moment, is the only company that, year by year, have new plants under construction. More than 30% of our development investments were allocated to electricity grid.

We are fully committed in distribution, a stable, regulated business which allow us to capture the accelerating electrification trend across Italy. We are expanding our renewable plant portfolio in a consistent and balanced approach.

Our diversified generation mix, combining renewable with flex technologies, allow us to support the stability of the system. Key projects, such as Corteolona waste-to-energy plant in province of Pavia, for example, which will treat 240,000 tonnes of waste per year, as well on track.

Is very important that we are growing, maintaining hedging between collection and treatment. For example, we grow in collection in Piemonte with a new very important contract in province of Cuneo, in Valle d'Aosta, in Liguria, and from the other side, we are growing in treatment with the new plants, the new waste-to-energy plant in Tarona, in Corteolona, in Trezzo sull'Adda, Crotone, and so on.

To wrap up, our disciplined approach to capex underpins a resilient growth today and tangible returns tomorrow. Speaking of results, let me now hand over to our CFO, Luca, who will illustrate our financial performance in '25 more in detail.

Please, Luca.

Thank you, Renato, and good afternoon to everybody. Let's start to examine our EBITDA performance into detail.

We can start from slide five. You can appreciate from the graph that all the businesses performed very well, but Generation and Trading need to be considered in the view of the normalization of the hydro.

Indeed, hydro normalization, the exit from the safeguard segment, and lower hedging prices were largely offset by very positive events, such as the growing of the performance of electricity network, thanks to the consolidation of Duereti, which proved even more profitable than expected; a greater contribution from the capacity market; solid retail margins; and higher revenues from waste-to-energy plants. Generation and Trading, as usual, is characterized by a well-diversified technology mix, which is the cornerstone of the business.

EBITDA was €728 million, with a decrease of 26% compared last year. Of course, we need to take into consideration the hydro effect.

The normalization of the hydro effect and some fewer opportunities from the energy commodities hedging and trading has been partially offset by higher contribution of thermoelectric production and an increase of the premium awarded in the capacity market. Renewable production decreased by 23% as a consequence of the lower volume in hydro, and thermo production increased by 11%.

Supply business. '25 saw another year of sound performance in supply business.

EBITDA stood at €464 million, with an increase of €2 million compared last year. Here, the exit from safeguard business was offset by the commercial development of the free electricity market, both in the mass market and in business segments.

The free electricity market customer base grew by 3% compared 2024, despite the competitive environment. Along with this growth in the electricity customer base, we have achieved a remarkable 12% increase in electricity volumes sold, up to 27.5 TWh, as Renato already said.

Let's move to page eight, Circular Economy. I would particularly like to highlight the strong performance of our circular economy business.

Adjusted EBITDA was 5 €595 million, with a growth of 2%, €13 million. We delivered a robust result in tricky areas: Treatment, Integrated Water Cycle, and District Heating.

Higher treatment prices fully offset lower margins from the Ac塞尔 [Acser?] plant new contract after the tender, while water cycle benefited from a higher allowed return.

District heating showed sound results, supported by higher energy prices, volume sold, and white certificates margins. The new Milan collection tender showed reduced margins due to our highly competitive bid against that of one international player, Urbaser.

We maintain strong EBITDA, confirming the resilience of the business, even considering the newly awarded tenders in some territories in the north of Italy. All key industry indicator are positive, such as electricity sold, waste-to-energy and other plants, plus 4%; waste disposal for energy recovery, plus 6%; and heat sold, plus 2%.

Smart Infrastructure, which marked a step change in scale and profitability. The adjusted EBITDA of the business unit was €580 million, with an increase of outstanding 37%, thanks to the sound performance of fully regulated activities.

Our electricity network delivered outstanding growth, €137 million, driven by the consolidation of Duereti for €93 million, the organic growth in RAB with an increase in electricity allowed revenues of the historical perimeter, €25 million, higher revenues for connection and other services, €10 million. The increase in electricity PODs, the point of deliveries, up 65% year-on-year, demonstrate how our grid are becoming an enabling platform for electrification and new consumption patterns.

Electricity distribution RAB increased by 52%, and the power network capacity by 71%. In gas network, we completed the asset rotation, strengthening our strategic focus on electricity distribution.

Gas distribution RAB decreased by 23%. Now, analyzing the profit and loss, starting from adjusted EBITDA equal to €2 billion 243 million, we recorded €964 million D&A, plus 60 €66 million compared '25, with an increase mainly due to capex deployed and completion of Duereti purchase price allocation process for €17 million.

Net financial expenses at €169 million, of which those relating to pure financial management were €157. The remaining part being financial accounting effects.

Compared to the €116 million of the last year. Adjusted taxes amounted to €306 million, a decrease of €46 compared to last year, with a tax rate of 29.8%—last year 29.4%.

Adjusted net profit at 600 and €86 million, with a decrease of 16% compared 2024. Normalized by hydro effect, the decrease was only 1%.

This is the adjusted group net profit. The reported group net profit is €750 million.

In 2025, we achieve a robust double-digit return on investment, 10%, and return on equity, 12%. Cash flow, page 11.

We accounted a net positive change in net financial position of €361 million. The net financial position at the end of the year was €5 billion 474, reflecting an improved leverage ratio to 2.4 times, compared 2.5 times at the end of last year.

Operating cash flow, €2 billion, fully finance capex for €1 billion and dividends—€1.7 billion—and dividend distribution, €300 million. We achieved a robust cash conversion rate at 65%, reflecting the ability of the company to optimize financial resources to support the growth.

Some details, net working capital of 311 was primarily driven by the reduction of trade receivable and partial settlement of the safeguard portfolio. Payment of taxes for €400 million and net financial expenses, 116.

As the result, the operating cash flow stand at €2 billion, after the 1.7 of capex and dividend for 300, and the hybrid bond coupon payment of €38 €48 million. The net free cash flow was €4 million.

Then we have the change in perimeter, which is due mainly to the disposal of part of the gas network to Ascopiave for €430 million, partially offset by €58 million related to some deals in M&A. Finally, the €50 million spent to our share buyback give to the total change of 361.

Thank you very much. Now I will hand back to Renato for the final part of the presentation.

Thank you, Luca. Page 12, to look our sustainable dividend growth.

Dividend growth is confirmed. We are going to propose to our assembly an increase of the dividend per share by 4% year-on-year, arriving to €0.104, online with our dividend policy.

This dividend growth is supported by strong cash flow visibility and disciplined capital allocation. 45% of payout ratio is the proof, let's say.

Page 13, our guidance is absolutely confirmed. We confirm our '26 guidance with adjusted EBITDA between €2.21 billion and €2.25, and the adjusted net profit between €630 and €660 million, reflecting our robustness and visibility on our business mix.

To close, as slide number 14, our well-diversified business model is really unique and delivers sustainable growth and attractive returns over the long term, allowing us to transform challenges into opportunities. We operate at the intersection of the energy transition and the circular economy, our two pillars, benefiting from both natural hedge activities and fully regulated business, supported by a consistent capex plan.

Year by year, our capex plan grow. Our generation portfolio is diversified, allowing us to leverage different technology.

Really, I think that A2A in Italy is the only company that has all the generation plants from thermo, hydro, wind, sun, and waste-to-energy plant. This integration is a super opportunity to optimize energy management, to capture market opportunities in different scenarios.

Integration across generation plants and different customer segments enable natural hedging, reduce our risk profile, and support cash flow generation. In particular, our fully regulated businesses remain a core strategic pillar, backed by a stable long-term regulatory framework.

As early movers in electrification and data center—and we are working a lot—we can leverage our energy assets to unlock value from this megatrend, enhancing growth and resilience. Together, these elements guide a balanced capital allocation that sustains cash flow generation, growth, and shareholder remuneration.

Really, as I said in my introduction, our '25 results confirm that we are on track with our long-term strategic plan, on trend with our leadership in electrification, renewables, and circular economy, and on target for the returns that we ensure for our shareholders. Thanks a lot for your attention, and now we'll be happy to open the Q&A session.

Yes. Good evening.

Thanks a lot for taking my question. I hope you can hear me well.

My first question is about the current market situation with regards to energy prices and power prices change. Just wondering first of all if you can highlight any risk, if any or not of course, on the gas procurement for your deliveries through this year, meaning if you have any direct LNG imports which is subject to curtailment in the coming months, and eventually if you are, in any case, exposed to any possible force majeure events from your reseller, naming ENI or other majors, or Edison, or Gazprom, or the other providers that currently gives you gas for your internal use.

If you can address these topics, if any risk currently or in the short term that you envisage for your procurement and deliveries. As a say, a subsequent question, if you can highlight to us what is the current level of open position through 2026 and '27 in order for you to get any benefit from the most recent increase in the power price?

What is the current situation for the hydro productions in the first month of the year and in terms of reservoir for the rest of the year? A comment, if you can, on your view about the potential regulatory risks so far, and potential EU interventions in the market, whether it's going to be taxation, or ETS revisions, or price caps, or whatever we will see in the coming.

If you have any view on what could be the potential regulatory risks? Thanks a lot.

Roberto, thanks for your question. I I I start talking about the general the general situation of the market that, of course, is is critical, and is also, but are some years in which every every couple of years, there is something of incredible in this world, let's say.

Talking about the risk to remain without gas, in my opinion, is impossible in this moment. The only problem is the price, but considering the storage that we have in this moment in Italy, that is, as 47%, and considering the temperature that we we are we have in Milan in this moment, that and the diversification that we have in Italy in this moment from all the sources, Algeria, Libya, Azerbaijan, LNG, and so on, risk of procurement in '26 and in '27, in my opinion, is is absolutely out of our view.

The problem in this moment can be exactly working on the storage, because, as we need to maintain a price summer-winter aligned to start immediately to fill the storage. In this moment, there is still some euros of spread.

You remember, last year, the government closed the spread with the rules in which companies that started early to fill was paid exactly to close the spread. I think that we need to wait for two-three weeks to have more visibility of what can happen in Iran, because it is difficult in this moment to understand if this conflict can move for months or weeks or days.

Then I imagine that our government will use the same instruments that was used in '22 and in '25. Talking about us, consider that, for '26, our hedging is at 70 72-73%.

Our normal situation in in March, in which the only flexibility is not to risk to have an over-hedging due to the risk of the hydro production. What is interesting is that we covered '26 to a price that is around 110, is high, and so over our budget, to understand, and also '27, also in '27, we have 50% of of energy covered with a good price, because is around 100, once again aligned with our our industrial plan.

Of course, the hydro production, in this moment, I can say that for this three so January, February, and March, we are absolutely aligned with the budget. We started the year with a good level of storage in our dam, in our basin.

In this moment, our forecast is to stay at the average level of A2A, more or less 4 TWh of hydro production. To close about ETS, probably 2 years ago, there was a declaration of the Ministry of Environment in in Germany that said that absolutely Germany don't want to move ETS, because ETS is a fundamental instrument for decarbonization.

Consider that our government asked to Europe to cancel ETS because is a tax, but is very simple to demonstrated that ETS is not a tax. That is emission trading system, and the tax is something that a company pay and the public administration receive.

The problem is that only in our country, considering the large countries, industrial country, effectively is a tax today, because, as there are more or less €3.5 billion of ETS paid, and only €600 million come back to companies, in particular to energy-poor companies. There are €2.9 billion that remain to serve our public debt.

This is the reason for why Italy is in infraction with Europe. What the other countries in Europe, in particular Germany and France and Spain says is, "Okay, guys from Italy, before discussing about ETS, is better that you replace the normal situation of ETS, a system of trading of exchange."

My personal opinion is that is absolutely impossible that ETS can be canceled in the future, because is really a nonsense. Consider all the companies that for 20 years invested in green economy exactly to be more competitive against the company that didn't invest.

Price cap for gas is out of every kind of discussion, but also our government don't put the price cap on the table. Luca, don't know if you want to integrate with something?

No, I think that everybody has been said. As we have the chance also to buy some LNG from British Petroleum with a contract signed.

We'll start in '27, we start also to get some opportunities into the market. As Renato said, the hedging ratio are pretty comfortable, both for '26 and '27.

I think that, of course, we need to monitoring what happened on the market with the prices. By now, everything is under control, also taking into consideration the financial point of view.

Other elements that is important to consider is that, if we see a reduction of PUN, the reduction of PUN produce an effect in which the renewables are less competitive and the thermo production more competitive. Consider that today, the total energy production with thermo is 115 TWh in Italy on 311 of total demand, and our forecast is that, with a reduction of PUN due to ETS, that is once again an hypothesis, in my opinion, impossible, but in this case, the production of gas jump to 150-160.

This is the reason for why the effect in the tariff in the bill for our customers is approx to zero, because the total ETS amount that arrive on the bill is more or less the same €5 billion under discussion in the reduction of raw material. A2A is a company super strong also in thermo production, imagine the new plant in Monfalcone.

In this case, that is a case that I don't consider, once again we have a natural hedging due to the fact that the reduction of production renewable from one side is compensated from the other side from a strong increase of gas production. Because gas production win against import.

This is the message. Not because there is a reduction in the renewable, that, of course, with the marginal price wins every time, but because the import is more expensive than thermo production without ETS.

Hi, everyone, and thank you for taking my questions, and thank you for the presentation as well. Two questions on the context on recently presented business plan, and one on your guidance.

On the context is if you can make any comment on recent detailed reports on the local press arguing a potential interest of A2A on ERG. If you can make any comment on that.

In general, in case of an extraordinary operation, what kind of assets fits better with your current corporate structure? Any comment on that would be appreciated.

Second question is on the data center opportunity that was widely elaborated back in November. When do you think that A2A would be in the position to provide with granularity and a whole business plan on the data center opportunity and with financial detailed targets and more granularity versus your statement back in November?

Any further guidance on the timing for that higher granularity would be appreciated as well. Then the third question is on the energy decree that has increased regional taxation IRAP by 200 additional basis points in 2026 and '27.

The fact that you are maintaining your guidance unchanged, is that including any compensation factor that is offsetting this increase in taxation? Is that related to a different pricing for your forward selling?

Is that related to a higher assumption? Any light on reasons for maintaining guidance would be appreciated as well.

Thank you.

Okay. Thank you, Javier.

For the first question, you know the answer because we used a press communicator. A2A regularly conducts a review on his strategic option consistent with our industrial plan.

In this context, discusses with many potential partner are absolutely normal. I think that is the mission of our management, to create value for shareholders.

I also think that, in Italy, there are too many companies working in the energy business, in particular in generation. The strong liberalization that we had 20 years ago produce a situation that probably is not completely efficient today.

To date, many strategic options are being considered as preliminary and exploratory thought, and no decision has been taken. This is our answer.

A2A, we keep, of course, the public informed of any possible development in the correct way. For data centers.

Data center is absolutely incredible what happened. You remember, we presented our industrial plan the 12th of November, San Renato.

After a couple of weeks, you can't imagine how many players and actors in data center knock at our door to understand what we are able to do for them. In particular, as I said during the presentation, the killer application in this moment is to have connection in high-voltage, because today if you ask to Terna, not only in Italy, but in all the other part of the world, to have a connection for let's say 200 MW, is impossible.

It takes 5 years. We are in particular in Lombardy in a super position in which we have generation.

We have land, we have some opportunities, and we have connection in high-voltage. You remember during our presentation, we underlined three projects without give a name, and also today I can't say exactly which are the project, but I can say that for the first two project, in term of roadmap, we are absolutely on track.

You remember which image in to arrive to have a first EBITDA from data center in '28-'29, we are on track. We are working.

The business model can be co-location, or we are also open to in some case in which we have opportunity to build large data center, we can also consider direct relation with other top companies. Please, wait for next our communication to have more visibility on a part of the strategic plan that is working well.

About the decree?

I would like to start saying that, in the energy decree, some aspect has been discussed, one being the IRAP taxation. Reading also from the newspaper, how the discussion is tough regarding the chance to increase taxes in Italy for corporates and citizens.

We need to wait the translation into law of the decree aspect. In any case, if and when there will be any increase in taxation, we can consider temporarily cause by the discussion.

It seems it will be affecting '26 and '27 and not further. For that reason, we can consider if it will come as an recurring item, into the so-called special items.

This is the reason why we maintain unchanged the guidance we communicate. Also and in particular because the guidance on the net profit is on the adjusted net profit.

Good afternoon. Thank you for taking my questions.

Just a couple. The first one is on the recent spike in electricity prices.

I wonder whether you can give us a sensitivity or a first order look on the potential impact on networking capital and provision, if there is something you have already tried to estimate. The second question is on hydroelectric generation.

I wonder whether you can give us an update on the concession renewal. Secondly, whether, let's say, the recent events have changed your attitude towards revamping and investments in this segment of your business.

Finally, if I may, what are the latest trends you have seen in the supply business? Thank you.

I start with the effects on the networking capital. Actually, we will not suffer for any increase or deterioration of the networking capital.

We have experience coming from 2022 where we manage properly the networking capital with different opportunities, which are the same in the case, because by now we are experiencing only temporarily situation. In the case it will last more than this period of time we have in front of us of 1-2 months, of course we have the chance to move on different opportunities, as I said.

These are, of course, temporarily effects. Also, as I said and I mentioned before, in term of liquidity, we are currently managing in a very appropriate way, with backup lines.

After 2022,

we increased backup lines to be well prepared in the case of higher volatility in the market regarding, in particular, marginal calls. At the moment, we are really in a very good situation.

Okay. About the hydro concession, the situation is this one: starting from the procedures concerning our super-little concession of Resio and Coderatti, launched by Regione Lombardia at the end of '23, 2.5 years ago, are still pending.

Temporary adjudication of the renewed concession is expected at the end of the first half '26. I imagine that is difficult for the region to arrive to assign this concession, because we put some question in the court about the procedures, and frankly speaking, I think that we are in the right position.

From the other side, you know that, in this moment, talking about the parliament, 360 all thinks that is not correct to do tenders without reciprocity in Europe. Talking also in Brussels with people that can be interlocutor for us in this topic, talking about the so-said quarta via, the so-said four way to assign, the idea is that we have to wait to close the PNRR, that means August '26, and after is possible to open a quick deal with Europe to be able to extract from the competition law the hydro concession, and to move in a way that is more or less a project finance in which surely in equilibrium between concession fee, capex, and correct remuneration of our asset will be the final solution.

Included, probably you read about this 15% of hydro release, that is a way, let's say, to have on board also all the lobby of Confindustria, that in this moment is strong with our government. Consider that, in the project finance, the reduction of revenue produce an effect for the concession fee, not for us, because for us, the idea is to have a remuneration of all the capex fixed by ARERA.

The total amount of revenue that arrives in our company don't change if there is the hydro release or not, but surely to have all the lobby that works together, our energy company, energivore company, Confindustria, and the regions, will bring to the result. Talking about the supply business, what I can say is that from one side is super interesting the B2B business, because the B2B, in this moment, have a churn lower than B2C, that is strange.

In the past, was every times the opposite, and A2A is super strong in this business. That is also super interesting because B2B means contract with companies, with industry, that can produce space to build PPA, that is the way to hedge our renewable production.

From the other side, is also interesting our growth of 3% in the mass market this year, '25 on '24, in the free market, electrical free market. In this moment, we have a reduction in gas, but the reduction in gas, let's say, is natural, because if we look the PDR, the number of contract in our distribution asset in Milano, year-by-year, in this moment, you have a reduction of 2%.

If there are reduction of the PDR, is normal to have a reduction in the consumption, number of customer, and so on. There is space to grow in electricity free market, in our opinion.

In our business plan, we have a reduction of marginality of 3% every year, but also this year, we haven't seen this reduction. Is stranger situation, because are probably 5 years in which every year we imagine, and in our industrial plan there is a reduction year per year of 3%, but till now, this reduction of marginality don't arrive.

Okay.

Good afternoon. Thank you for the presentation.

My first question is on the cash conversion was quite good, 65%, and basically you fully finance the capex and the dividends. My question is on '26 outlook on the same, if this could be improved and what could be the guidance for in-depth on the EBITDA, obviously still considering as you confirmed the guidance for EBITDA net profit before the energy crisis and before the Italian energy draft law.

In this case would be a consistent guidance before these temporary or not, one-off intervention. This is the first question.

The second is on gas procurement. You mentioned before your contract with BP, but this contract, the LNG would cover only around 20% of the group's needs.

If you can remind the other sources by geography, basically the breakdown of the sources by geography. The third question is on the price cap.

If I remember well, you applied a litigation like other companies in the sector against the old price cap put in place in 2 2-3 years 3 years ago basically, no? Considering that this litigation is still ongoing, what is your opinion?

Probably the government would not adopt another similar measure, considering that there is still a litigation ongoing, or at least would be the price cap aligned to the European level, which was more than twice, three times basically compared with Italian level. Finally, you mentioned the hedging, 72-73% of the volumes.

I missed if you have said or not the price, euro per megawatt hour, for '26. Indeed, a last final question on the market supply.

On the market supply, still focusing on the potential new gas and energy crisis in the next few months, to what extent could you protect more your profitability in the market supply business unit compared with the previous crisis? Probably you have already changed the contracts, in order to minimize the shipping costs, etc.

If you could provide more color on that. Thank you.

I will start, Emanuele, with the first and the fourth, your questions. Cash conversion.

We presented the business plan, as you remember, with a conversion cash conversion rate in area of 50%. The year was the year '25 was quite positive.

We managed very well, as I said, networking capital, also taking into consideration the opportunity the opportunities we had to lower the trade receivable coming from safeguard market and the reimburse of the safeguard market of the client so-called not disconnecting, disconnectable. After the report we submitted, we we got some €60 million from the authority.

Forecast for '26, we are used to manage in the same way, with the same proactivity, our networking capital, and we maintain the target to achieve a cash conversion rate in line with 50%. As I said, we have different opportunities to manage the networking capital, also in trade receivable in trade receivable, but also in the payments and contract, in particular, we have for trading purposes.

In '22, we move some of those to OTC market to take the opportunity to manage also the the the terms of payments and so on. I don't have any, let's say, clue to say now that it could be deteriorated by the current situation.

On the other side, we are really hands-on to fulfill the target and to achieve it. In term of leverage, again in the plan was 2.7, not to exceed 2.8, and this remain our target.

If we are able to make it better, of course we we can work for for it. But 2.7 is pretty in line with the credit metrics target we have also discussed with the rating agencies.

Is interesting your question about the supply, because the lesson learned in '22 was that you can't maintain a fixed price with open quantity. The problem that we had in '22 was exactly that, with companies with fixed price and without a limit on the demand, increase the demand a lot, and for us was super critical.

You remember that we lost a lot of money in that situation. Today, frankly speaking, in this situation, for us there are only opportunities simply because every times in which the price increase, for example, there is a strong reduction of the churn.

The churn, in this moment, is the bigger problem that our company are facing. We imagine to be able to grow in the supply market in this moment without absolutely any negative effect, exactly because we changed all the contract since '22 till now, avoiding any risk of quantity that we had in '22.

Talking about price cap, frankly speaking, if you remember in '22, when there was the discussion and some output in Europe about price cap, the price cap was fixed so high that was impossible to imagine to arrive. In this moment, we are very far from what happened in '22.

The price cap in this moment is not under discussion. About the possibility to gas procurement, in this moment, we signed, as Luca said, an agreement to buy 1 billion of cubic meter of LNG from US starting from the last quarter '27.

Was a good idea, consider that our total needs of gas is 5 billion. That means that 20% for us arrives directly from this new contract.

For the rest of 4 billion, in this moment is difficult to see a situation in which in Italy there is a risk of disruption of to remain without gas. I think that we are in a situation in which we are in a better position against others.

Is enough to see the situation of the storage in this moment in Germany, the north of Europe, there are 18% of storage. In Italy, but also in other southern country, we are more or less at 50%.

That is also linked to the fact that we need less gas for to climatize the buildings during winter, of course.

Sorry, I missed to answer your fourth question about the hedging. I repeat it: for 2026, we are hedged by 72-73%, with an average price of 110, which is quite remarkable.

For 2027, we already complete almost 50% with an average near to a 100. This is quite satisfactory for us, taking into consideration the situation in which we were at the beginning of the year, and considering the current situation.

We are pretty in a good shape to face '27 also in term of budget when we approach the time to do it.

Consider that, in this moment, the calendar '27 is higher than 100. This morning was €102-€103.

If the situation remained this one, we are able in the next weeks to arrive to cover our normal 70% to a price fully aligned with our plan. If we'll see a reduction, consider the side effect on the thermo production.

We face '27 with 50% covered at 100, and the other 50% open, but if we'll see a PUN reduction, that means that there is more space for thermo production against import. In every case, our natural hedging is strong and able to face all the situation.

Hello. Can you hear me this time?

We can.

Oh, perfect. Sorry.

I do apologize for before, not sure what happened. I've just got two very quick questions, please.

The first one's on the electricity distribution concession extension. Just given there is this really quite strong political spotlight on customer bills at the moment, I'm wondering if you see that there's potentially a risk that either the timeline gets pushed to the right or delayed, or that the fee may not actually end up going on the RAB and remunerated that way?

Then just a second clarification, please, on the data center platform and the earlier question. Did I hear correctly that you would also consider partnerships where you would not actually necessarily be building the data center shell yourself?

Thank you.

No, for the second, the answer is not. Our strategy is exactly what we explained during the presentation of our industrial plan.

In particular, consider that I talked before about the two first project under design, and are both direct investment that we want to do. Consider that, for us, are interesting partnership also with large players more able than us to find the customer to locate the data center, and this is interesting for us, because there are companies that already has a lot of customer in different data center.

Our goal is to be able to build data center in good position, for example, in Milano, to be clear, with a low cost of energy for connection behind the meter, and low PUE for connection with district heating and good water management. More attractive for the same customer that some players already have.

Can be a commercial partnership, let's say, but we want to consolidate in our EBITDA all the capex that we put on the table. For the concession, sorry, you are talking about the grid concession?

The grid concession,

the only problem is that it takes some months more than normal the exchange of our authority, ARERA, because you remember probably that it takes 4 months of prorogation the new board of ARERA. The new board of ARERA was appointed a couple of months ago, and immediately with some problems linked to the decree for the energy and now for the war and so on, the concentration to support the government in the grid concession has to arrive.

From our point of view, frankly speaking, is not a problem, because we have a concession, and consider that a new concession will be 20 years longer. If the starting point is as a delay, is not, frankly speaking, a problem.

What is interesting talking about power grid is that, if you look Duereti, the piece of the grid that we bought from Enel last year, the performance in terms of EBITDA '25 and total capex amount is higher than our business plan. We are super happy, because we was able immediately to face a network that we didn't know in a very efficient way.

In looking these opportunity, once again we did a super good deal increasing our RAB and our capex, of course, linked to the balance law '24 that says that we'll have the concession extended. Don't know, Lester, if it's clear for you.

Hi. Good afternoon, and thank you so much for taking my questions.

I have a couple of follow-ups. The first one is regarding the energy decree and the potential revision of the ETS mechanism.

Could you help us to quantify what could be the potential impact in terms of power prices in Italy, and also how this will translate to your generation EBITDA? I guess that more in 2028, once the effects from hedging are lower.

This will be the first one. Then the second one will be related to the Monfalcone plant.

Could you give us an update on the current state, and when do you expect to commission the new plant? That's it for me.

Thank you.

Talking about ETS, I can say simply that, starting from the fact that I imagine that is absolutely impossible to have a PUN without ETS. I don't think that the government will arrive to have an approbation from EU.

You can't simply reduce the cost of ETS, that in this moment is more or less €30 for megawatt-hours from the PUN, because is linked to the number of hours in which the PUN price is fixed by the gas production, that is super variable linked to what happened, for example, with the hydro production, and is linked to the fact that will be able or not to increase the total capacity of renewable aligned with the PNIC, our national plan. In this moment, surely is much lower than 30% €30.

Is early to say if is 50% of this value, or more or less. Surely the impact I can say that you have seen during the presentation in 23 of February of Enel, Enel says €85 for megawatt-hours, that is their estimation.

Frankly speaking, we didn't do an estimation, because we don't believe that is possible to have this impact. An hypothesis can be that one.

Talking about Monfalcone, Monfalcone is under construction. Under construction means that the delivery is probably in the first quarter '27, more or less 1 year to arrive in commercial operation, because the construction will end this year.

Then, there are a pre-operation, operation, and so on. We are expected to have EBITDA starting from '27.

Hi. Good afternoon, gentlemen.

Thank you for taking my question and for the presentation. I have three, actually.

The first one that is on the broader context. You already shared your view about the ETS, and since that gas is fixing the prices in Italy, for example, most of the times, do you see in future if the ETS mechanism won't be canceled from the formation of the final power prices, a scenario where do you see a potential decoupling also of the gas component, the renewable fixing price and on the other hand gas?

Just wondering because at the end of the day, the gas is, as you said, 1/3 of the entire demand in Italy, but actually is fixing the price for most of the production. Just a question, if it is viable for you, even in a longer term.

Second question on your guidance. You said that your hedging for '26 is quite good, actually a little bit higher than your projection for 2026.

Looking at what the dynamics in the first quarter, notably during January for the rigid temperatures, the potentially impact on district heating, and actually the higher production as from Terna on a thermo side, there are some positives that are contributing actually to your figures for 2026. I was wondering, confirming the guidance today is just because you see that there could be some potential compensatory factors to these positives, or it just too early at this time of the year to revise the guidance?

Finally, last question on the batteries. You spoke a little about this technology, you mentioned some upside in your business plan.

I was wondering if, given the fact that the technology looks in a good momentum, was wondering if you can provide your view and if you are thinking about investing in this technology in order to let your portfolio generation more flexible, and so on? Thank you.

Okay. Coming back to ETS, consider that we did a simulation to understand what can happen in the bill of the citizen due to the energy decree.

This is interesting, because the idea is to be able to reduce, let's say, around €20 the PUN in all the energy on the market. The energy on the market is today 275 TWh.

Consider that the total consumption is 311, but there is autoconsumption, you have to consider on the market 275. For 20, is more or less 5 billion.

The idea of the government is to reduce €5 billion of cost of raw material. On the other side, the idea is to put on the bill the cost of ETS, considering ETS €30 for megawatt-hour in the total terawatt-hour of 115.

Which is the problem? That in this moment the demand is 148 from renewable, including the hydro, 52 from import, and 115 from thermo production.

If there is a reduction of PUN of more or less 20%, the total production in renewable remain the same, and there is no hours in which the price is fixed with renewable. We see a reduction of import from 52 to 10, more or less, with an increase of thermo production from 115 to 155-160.

In this case, if you multiply 160 for 30, you can see that there are once again €5 billion of cost of ETS on the bill of our customers. The sum between reduction of raw material and increase of tax is exactly zero.

This is the reason for why, if you read the last version of the decree, there is written that is possible to reduce the ETS only if there is the proof not to have impact on the import. That means that is if is possible, more difficult to calculate the real impact of ETS, because you have to imagine an authority, ARERA or the others, that have every hour of a day to calculated if the reduction of ETS on the PUN produce reduction of import or not.

A nightmare, a complete nightmare. We imagine that is super difficult to move this part.

To close, I think that, in this moment, is really critical to imagine an ETS effect. I imagine that in EU will find a solution not to accept our Article 6 of our energy decree, and this is the answer.

Talking about batteries, only to close, the business battery is interesting, the reduction of price is huge. During the last tender, MACSE, the price arrived to a super-low level, but this is due to the fact that the supply like CATL or other from China reduce the price, put on the table 20 years of guarantee.

That means business plan of 20 years. The problem is that the payback period of this business is very long, and so our evaluation is if is interesting or not to invest a lot in a business that is, let's say, like an infrastructure, but the infrastructure is a battery.

I confirm that our commitment in battery, in this moment, is lower than, for example, in power grid. Regarding the guidance, Davide, I think that it is too early to say something you can appreciate.

It is true what you said. We have some opportunities, but also we have some other aspect that we need to take care about.

The price of the energy is lower than last year. We already incorporated into the business plan, but if you want to make a change compared last year, you have a difference.

Sticking on the guidance, we are pretty comfortable to stay on that. Let's see how the scenario is going to move.

If we have the chance to getting some more opportunity, of course we are here, and also to lower the risk for the aspect that are not in the right direction. For the time being, I think that we feel comfortable with the current guidance.

Yeah. Thank you everyone for taking the time to participate for your Q&A.

If you need any additional follow-up or deep-dive, please contact the IR department. Thank you everyone.