(Updating with further management comments on plan)
MILAN (Thomson Financial) - Iride SpA said its EBITDA will rise an average
of 12 percent a year in the period 2008-2012 to reach 560 million euros at the
end of 2012, from the 322 million euros posted in 2007.
Iride said it will invest 1.3 billion euros in its business in the period
which will be financed by cash flow and the disposal of non-strategic assets.
The company said 72 percent of capex will be for development while 28
percent will be for maintenance.
Power generation will absorb 41 percent of capex while investments in
liquefied natural gas (LNG) terminals will account for 13 percent. Iride
chairman Roberto Bazzano said at the end of 2012 the debt-EBITDA ratio will be
about 2.6.
Speaking in a conference call with analysts, Bazzano said partnerships and
project financing will be used to support development.
Iride chief executive Roberto Garbati said he expects the group to take part
in consolidation operations in 2008.
Garbati said that Iride, Hera SpA, Enia SpA and, probably, Acea SpA will
meet soon to discuss possible tie-ups.
He said he believed the management of Acea is interested in a broad-based
consolidation operation.
Sources have said Acea is more interested in pursuing closer ties with its
current partner Suez in light of the French group's imminent merger with Gaz de
France.
Garbati said Iride's presence in two LNG projects increased the company's
bargaining chips in merger talks with other utilities.
Iride has stakes in both the OLT LNG terminal being built off the Leghorn
coast, and which is already authorised, and in the Medgas terminal being built
at Gioia Tauro which is not yet authorised.
Iride said that the overall investment to build the Medgas terminal is about
one billion euros.
Iride has a 50 percent stake in Fingas which controls 69.8 percent of the
Medgas project.
In the OLT terminal project, Iride is an industrial partner alongside of
Endesa SA which will soon be replaced by E.ON AG.
"We expect E.ON to replace Endesa before summer," Bazzano said.
The OLT project is expected to open in 2011 and be fully operational in
2012, Bazzano said, adding Iride will have 1.5 billion cubic metres of gas per
year from the facility.
Asked about dividend policy, Iride management said the plan is premised on a
payout ratio that envisages 60 percent to 65 percent of profits being
distributed by way of dividend.
stephen.jewkes@thomsonreuters.com
sj/lam/sj/am
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