2019 Digital annual reports

Terna and the
Covid-19 emergency

Energy is our responsibility. Responsibility is our energy.

We are a major operator of grids used to transport energy. We manage the high-voltage transmission of electricity in Italy, ensuring security, quality and cost-effectiveness over time. We are working hard on development of the electricity grid, the achievement of ongoing improvements in operational efficiency and integration with the European grid. We guarantee equal access to all grid users. We are developing Non-regulated Activities and new business opportunities, building on the experience and technical expertise gained in managing complex systems and on our technological excellence.

We promote the energy transition and sustainable development by focusing on people and innovation. Every day, we work to build an atmosphere of dialogue and trust in local areas, to which we bring a vital asset for everyone's economic and social lives: electricity. This translates into choices based on respect for the environment and local communities. Our inclination to listen begins within the Company, among our people, in the awareness that the radical transformation the world is experiencing is a shared responsibility. This responsibility is our energy.

Development of the electricity system and the opening up of the market for services to new resources

Large power plants

approx. 250 production units

Large power plants

approx. 250 production units

Demand Responde
Distributed Generation
RES not yet enabled
Storage (also electric vehicles)

Potentially over 800k production plants and approx. 40Mn comsumption units

The world is calling for a global commitment to progressive decarbonisation, to be delivered in the shortest time possible. This major change will see electricity networks and transmission system operators (TSOs) play an increasingly central role, with the need to meet challenging goals linked to sustainability, competitiveness and security. The switch to a decarbonised energy system will require us to maintain high levels of quality and service continuity within a more complex electricity system, in which non-programmable renewable sources (such as solar, wind and hydroelectric) be of growing importance.

Key dimensions of the electricity system

Extreme climatic events

Electrification of consumption

Reduction of thermoelectric generation

Growth of RES

Security

Adequacy

Quality

Resilience

Efficiency

The penetration of renewables will pose major challenges for management of the electricity system, given this non-programmable nature of production and their concentration in the south of the country. Further challenges are linked to the system’s exposure to extreme climate events, which now occur far more frequently than in the past. Terna is responding to these major changes by focusing on five key aspects of management of the system: security, adequacy, quality of service, resilience and efficiency.

Statement from the Chairwoman and the Chief Executive Officer

The energy transition represents a major opportunity. Nothing less than an industrial transformation requiring a collective commitment from businesses, government and other stakeholders, called on to work together to devise strategies and implement projects designed to achieve the goals of decarbonisation, energy efficiency and security, and to deliver research, innovation and competitiveness.

In this new scenario, Terna has a crucial role to play as an enabler of the current transformation, requiring us to manage the growing complexity of the electricity system, whilst also establishing Italy’s importance as a European energy hub serving the Mediterranean area. As a key player in the “green revolution”, Terna is continuing to invest in order to guarantee an increasingly modern, efficient, secure, flexible and sustainable electricity grid.

The Strategic Plan 2020-2024 envisages accelerated investment in Italy’s national grid, with the aim of supporting the energy transition and the country’s decarbonisation strategy. This will have a major impact on development, partly through an increase in the induced impact. In this regard, the €7.3 billion we intend to invest in Italy’s electricity infrastructure marks the biggest investment programme ever undertaken.

Innovation and digitalisation are of strategic importance in this process. In 2019, Terna opened three new Innovation Hubs in Turin, Naples and Milan to exploit synergies between the Group’s own skills base and outstanding local expertise, developing ideas and innovative projects.

Terna pays great attention to the relationships between our business activities and the social and environmental context. In the last three years, we have organised over a thousand meetings with local communities, making participatory design our chosen approach for reaching shared, sustainable solutions for grid development.

The alignment of Terna’s mission with major international sustainable development goals is strengthened by the integration of sustainability into everything we do and the decisions we take: in addition to innovation, we are committed to people, above all to their safety at work both within and outside the Company, to ongoing dialogue with local communities and to reducing our environmental footprint.

We aim to put Italy at the centre, strengthening our country’s leading role in Europe’s energy system, take advantage of new enablers and new technologies and making a major contribution to employment and generational turnover among our personnel.

The results achieved in 2019 show how Terna has the ability to deliver on our objectives and confirm the validity of management’s approach to growing the business. The Group’s strong operating and financial performance will, moreover, enable Terna to continue to work towards providing a system that is increasingly secure, efficient and sustainable for the benefit of everyone.

Luigi Ferraris
Chief Executive Officer

Catia Bastioli
Chairwoman

Find out more

Highlights

Our performance

Revenue

€2,295.1m

+4.5% vs 2018

EBITDA

€1,741.2m

+5.5% vs 2018

Profit

attributable to owners of the Parent€757.3m

+7.2% vs 2018

Capex

€1,264.1m

+159% vs 2018

€6.786 per share

New all-time high

registered on 19 February 2020

20.2%

Share price performance

since the beginning of the year, with a price of €5.954 at 31 December 2019 vs
vs €4.95 per share at 31 December 2018

320 TWh

Electricity demand

625 MWh

RENS

(Regulated Energy Not Supplied) annual target of approximately 881 MWh set by ARERA.

35%

Demand met by renewables

- €4,5m

Cost of service quality incentives vs 2018

vs 2018

Italy-Montenegro interconnector

This 600 MW interconnector is 445 km long

Acquisition of Brugg Kabel AG

one of Europe’s leading manufacturers of terrestrial cables

Italy-France Interconnector

The laying of 75 km of cable has been completed, representing around 78% of the entire connection

Open Fiber Project

17,000 km of long-distance fibre cable delivered out of the 21,000 km envisaged under the related contract

New acquisitions in Brazil

completion of the transaction with Construtora Quebec to acquire one of the two new licences

6,057 hours

when share of demand

through the electricity grid is met by renewables exceeds 30%, equal to 69.1% of the total

0.40%

leakages of greenhouse gas SF6

94%

waste recycled

179 km

obsolete lines demolished

144 km

new underground lines

208

people under 30 hired

47 hours

training per capita

98%

of personnel

took part in at least one training course

19.8%

of senior managers are women

ahead of the percentage of women in the total workforce (13.9%)

469

meetings with local authorities

meetings with the public

plots of land

returned to owners following the demolition of obsolete lines

Financial

Share price

Operational

Key projects

Environmental

People

Social

Our strategy

2020-2024 Strategic Plan

To play a leading role in the coming sustainable energy transition, by leveraging our distinctive innovation capabilities, competencies and technologies for the benefit of all stakeholders: this is Terna's mission, as confirmed in the new strategic plan.

Our investment programme

€7.3 billionin Regulated Activities
(up 20% compared with the previous programme)

~€900 millionin innovation and digitalisation
(up 30% compared with the previous programme)

Find out more

Our strategic framework

Guiding role in sustainable energy transition

Regulated

Non-regulated

International

Further strengthening and leveraging technology

Development of new services supporting the energy transition

Enhancement of core competencies

Pillars

Enablers

Developing leadership in innovation

Skills optimization

Innovation and digitalisation

People

Regulated activities

“We will strengthen our core business in Italy, investing in the electricity grid. We will give top priority to all the activities that enable Italy to tackle its energy challenges in a safe, efficient and sustainable way by leveraging our technological expertise and the specific characteristics of local areas.”

€4.2 billion - Development of the national electricity grid
€0.9 billion - Defence plan
€2.3 billion - Renewal and efficiency projects

Find out more

Non-regulated activities

“Non-regulated Activities will be geared towards supporting the energy transition, taking advantage of opportunities beyond our core activities, pursued in line with Terna's mission.”

Consolidation of our role as “Energy Solutions Provider”
Development of high value added solutions and products for businesses
Expected contribution of Non-regulated Activities to the Group's EBITDA: €450 million

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International activities

“We aim to leverage the core competencies developed in Italy as a TSO through growth opportunities overseas.”

Strengthening Italy's role as a hub and platform for cross-border electricity trade
Operation and maintenance of power lines in Latin America (Brazil, Uruguay and Peru)
Expected contribution of International Activities to the Group's EBITDA: €200 million

Find out more

Innovation and digitalisation

“Innovation and digitalisation, needed in order to manage the complexities of the system, represent one of the two key drivers in our strategy, as well as a paradigm change: from Watts to Bytes.”

~€900 million in investment in new digital technologies to transform the grid
Creation of Innovation Hubs around Italy, developing innovative ideas that will benefit the electricity grid
Development of a shared vision of processes, forming the basis for the creation of strategic, innovative projects developing the country's entire electricity system

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People

“Energy for change starts with our people, who represent the second key driver of our transformation.”

Safety improvement initiatives
Development of digital skills, performance appraisal and the progressive extension of agile working practices
Alignment of individual performance with the Company's business objectives, developing welfare and gender equality policies

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Focus on innovation

Innovation and digitalisation are indispensable in an increasingly complex, integrated and distributed energy system. Decisions regarding future development focus on the technology trends most relevant to our business.

Find out more

15 years of sustainability

The Sustainability Report 2019 marks Terna’s fifteenth annual report on its non-financial performances, proof of a concrete commitment that is increasingly integrated into the Group’s business.

Over the intervening years, our sustainable approach to doing business has resulted in a growing contribution to the creation of value over the medium to long term, mitigating ESG (Environmental, Social and Governance) risks, boosting our human capital and establishing constructive relations with stakeholderrelations with stakeholders. Our constant commitment to improving our ESG performances, through the introduction of guidelines, policies and monitoring systems, is reflected in the sustainability ratings assigned by the leading international agencies.

The “Corporate Social Responsibility and Internal Communication” department is established

Inclusion in the FTSE4Good index

2005

2006

The first Sustainability Report is published (for 2005)

The Board of Directors approves the Code of Ethics

ISO14001 and OHSAS18001 certification (Environmental and Safety Management System)

The first Sustainability Report based on the GRI standards and to be externally assured is published (for 2006)

2007

2008

Agreement with LIPU (Lega Italiana Protezione Uccelli-Birdlife International) regarding a scientific study of the interaction between HV power lines and birds

Terna signs up to the United Nations Global Compact

Inclusion for the first time in the Dow Jones Sustainability Index (DJSI) World

First ever inclusion in the Ethibel Sustainability Index

Guidelines on “Corporate Giving”

Strategic partnership agreement with WWF Italia

2009

2010

Inclusion of sustainability goals in the BSC system

Work carried out at the WWF’s Oases under the partnership agreement

Inclusion in the STOXX® ESG index

Partnership agreements with Greenpeace and Legambiente

Membership of the IIRC-International Integrated Reporting Council

2011

2012

Inclusion in Vigeo’s Euronext index

Multi-stakeholder survey of Terna’s social commitment

The first multistakeholder panel is carried out

The first materiality analysis is conducted

Terna is a founding member of the “Global Compact Network Foundation Italy”

2013

2014

New stakeholder map created

The first Integrated Report is published

Industry Leader in the Electric Utilities sector of the DJSI

The “Cantieri aperti e trasparenti” (Open and Transparent Contracting) site goes online

Guidelines on the “Stakeholder management model”

2015

2016

The Board Committee “Audit, Risk, Corporate Governance and Sustainability” is established

The first edition of Next Energy, an initiative for young talents and innovators, takes place

“Terna Incontra” events, a new form of stakeholder engagement for citizens, are launched

Guidelines on the “Social and environmental aspects of the supply chain”

“Whistleblowing policy” guidelines

Terna is the first Italian company to receive ISO 37001 certification (Anti-corruption)

The Chief Executive Officer, Luigi Ferraris, takes part in the “Private Sector Forum” at the United Nations

Guidelines on “Respect for human rights in the Terna Group”

The “Supplier Code of Conduct” is published

Creation of the “Avian Team” group to protect biodiversity

2017

2018

Industry Leader in the Electric Utilities sector of the DJSI

The first Green Bond is issued

Integration of SDGs 7, 9 and 13 into the Strategic Plan 2018-2022

The Chief Executive Officer, Luigi Ferraris, takes part in the “Private Sector Forum” at the United Nations

Terna is the first Italian company to receive ISO 55001 certification (Asset Management)

“Local stakeholder engagement and grid development” guidelines

Industry Leader in the Electric Utilities sector of the DJSI

Sustainability goals (“Sustainability actions and KPIs for the Strategic Plan 2019-2023”) integrated into the Strategic Plan

Guidelines on the “Consolidated Non-financial statement”

New “Corporate Giving” guidelines

The “Terna Plastic Free” initiative is launched

2019

Financials

Historical data

Revenue

Profit for the year

EBITDA

Net debt

EBIT

Equity

Consolidated financial statements

Consolidated income statement

Consolidated statement of comprehensive income

Consolidated statement of financial position

Consolidated statement of changes in equity

Consolidated statement of cash flows

Green finance

Green bond

10 January 2019

Terna launches a fixed-rate green bond issue in the form of a private placement, amounting to €250 million, reopening the bond issue of 23 July 2018.

Green bond 2

3 April 2019

Terna issues a new green bond worth €500 million. The issue, which proved very popular with investors with with bonds 7 times oversubscribed, has a 7-year and pays coupon interest of 1%.

Revolving Credit Facility

23 April 2019

Soon after the €500 million green bond issue, Terna obtains a back-up ESG-linked Revolving Credit Facility from a pool of banks, in the form of a committed credit facility amounting to €1.5 billion.

Read the Green Bond Report

Consolidated income statement
(€m)

	NOTE	2019	2018
A - REVENUE
1. Revenue from sales and services	1	2,287.90	2,272.50
of which related parties		1,632.80	1,603.60
2. Other revenue and income	2	56.9	46.6
of which related parties		4.9	16.1
Total revenue		2,344.80	2,319.10
B - OPERATING COSTS
1. Raw and consumable materials used	3	142.8	204.4
of which related parties		0.3	0.2
2. Services	4	187.3	191.2
of which related parties		17.1	19.7
3. Personnel expenses	5.0	256.7	244.1
- gross personnel expenses		334.2	312.3
- capitalised personnel		(77.5)	(68.2)
expenses of which related parties		2.9	2.9
4. Amortisation, depreciation and impairment losses	6	586.1	554.1
5. Other operating costs	7	16.8	28.8
of which related parties		0.1	0.1
Total costs		1,189.70	1,222.60
A-B OPERATING PROFIT/(LOSS)		1,155.10	1,096.50
C - FINANCIAL INCOME/(EXPENSES)
1. Financial income	8	11.3	6.9
2. Financial expenses	8	(92.3)	(98.3)
of which related parties		(0.3)	(3.1)
3. Share of profit/(loss) of investees accounted for using the equity method	9	3.3	2.6
D - PROFIT/(LOSS) BEFORE		1,077.40	1,007.70
E - TAX E - INCOME TAX EXPENSE	10	313.5	296.1
F - PROFIT FOR THE YEAR		763.9	711.6
Profit attributable to owners of the Parent		757.3	706.6
Profit attributable to non-controlling interests		6.6	5.0
Earnings per share	11
Basic earnings per share		0.377	0.352
Diluted earnings per share		0.377	0.352

Consolidated statement of comprehensive income
			(€m)

NOTE		2019	2018
PROFIT FOR THE YEAR		763.9	711.6
Other comprehensive income for the year reclassifiable to profit or loss
- Cash flow hedge	23	(93.7)	(32.1)
- Financial assets at fair value through other comprehensive income	23	0.6	1.1
- Gains/(Losses) from translation of financial statements in currencies other than the euro	23	(0.6)	(4.8)
- Cost of hedges	23	(11.6)	(1.8)
Other comprehensive income for the year not reclassifiable to profit or loss
- Actuarial gains/(losses) on provisions for employee benefits	23	(2.1)	0.9
COMPREHENSIVE INCOME FOR THE YEAR		656.5	674.9
COMPREHENSIVE INCOME FOR THE YEAR ATTRIBUTABLE TO:
Owners of the Parent		649.9	669.9
Non-controlling interests		6.6	5.0

Consolidated statement of financial position
(€m)

	NOTE	31 DECEMBER 2019	31 DECEMBER 2018
A - NON-CURRENT ASSETS
1. Property, plant and equipment	12	13,864.20	13,244.30
of which related parties		45.3	40.9
2. Goodwill	13	230.1	230.1
3. Intangible assets	14	312.6	289.3
4. Deferred tax assets	15	64	3.3
5. Investments accounted for using the equity method	16	79.4	76.1
6. Non-current financial assets	17	451.3	229
7. Other non-current assets	18	15.9	14.8
Total non-current assets		15,017.50	14,086.90
B - CURRENT ASSETS
1. Inventories	19	50.9	63.4
2. Trade receivables	20	1,290.70	1,167.00
of which related parties		423.2	409.7
3. Current financial assets	17	519.3	404.5
4. Cash and cash equivalents	21	1,057.40	1,328.90
of which related parties		0.1	0.1
5. Income tax assets	22	5.2	19.3
6. Other current assets	18	62.7	86
of which related parties		-	3.3
Total current assets		2,986.20	3,069.10
TOTAL ASSETS		18,003.70	17,156.00
C - EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT
1. Share capital		442.2	442.2
2. Other reserves		681.7	788.5
3. Retained earnings/(accumulated losses)		2,478.30	2,240.10
4. Interim dividend		(169.2)	(158.2)
5. Profit for the year		757.3	706.6
Total equity attributable to owners of the Parent	23	4,190.30	4,019.20
D - EQUITY ATTRIBUTABLE TO NON-CONTROLLING INTERESTS	23	41.6	35
Total equity attributable to owners of the Parent and non-controlling interests		4,231.90	4,054.20
E - NON-CURRENT LIABILITIES
1. Long-term borrowings	24	9,480.70	8,227.60
2. Employee benefits	25	63.9	69.4
3. Provisions for risks and charges	26	210.3	241.4
4. Non-current financial liabilities	24	160.4	59.2
5. Other non-current liabilities	27	834.9	373.8
Total non-current liabilities		10,750.20	8,971.40
F - CURRENT LIABILITIES
1. Short-term borrowings	24	25	25
2. Current portion of long-term borrowings	24	126.5	1,230.60
of which related parties		-	500
3. Trade payables	28	2,445.20	2,539.60
of which related parties		85.5	66.7
4. Tax expense	28	11.8	5.1
5. Current financial liabilities	24	87.7	90.4
of which related parties		-	0.5
6. Other current liabilities	28	325.4	239.7
of which related parties		20.9	14.7
Total current liabilities		3,021.60	4,130.40
TOTAL LIABILITIES AND EQUITY		18,003.70	17,156.00

Consolidated statement of changes in equity
31 DECEMBER 2018 - 31 DECEMBER 2019
GROUP’S SHARE CAPITAL AND RESERVES											(€m)
	SHARE CAPITAL	LEGAL RESERVE	SHARE PREMIUM RESERVE	CASH FLOW HEDGE RESERVE	OTHER RESERVES	RETAINED EARNINGS/ (ACCUMULATED LOSSES)	INTERIM DIVIDEND	PROFIT FOR THE YEAR	EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT	EQUITY ATTRIBUTABLE TO NON- CONTROLLING INTERESTS	EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT AND NON-CONTROLLING INTERESTS
EQUITY AT 31 DECEMBER 2018	442.2	88.4	20	(46.6)	726.7	2,240.10	(158.2)	706.6	4,019.20	35	4,054.20
PROFIT FOR THE YEAR								757.3	757.3	6.6	763.9
OTHER COMPREHENSIVE INCOME:
- Change in fair value of cash flow hedges	-	-	-	(93.7)	-	-	-	-	(93.7)	-	(93.7)
- Actuarial gains/(losses) on employee benefits	-	-	-	-	(2.1)	-	-	-	(2.1)	-	(2.1)
- Gains/(Losses) from translation of financial statements in currencies other than the euro	-	-	-	-	-	(0.6)	-	-	(0.6)	-	(0.6)
- Financial assets at fair value through other comprehensive income	-	-	-	-	0.6	-	-	-	0.6	-	0.6
- Cost of hedges	-	-	-	(11.6)	-	-	-	-	(11.6)	-	(11.6)
Total other comprehensive income	-	-	-	(105.3)	(1.5)	(0.6)	-	-	(107.4)	-	(107.4)
COMPREHENSIVE INCOME	-	-	-	(105.3)	(1.5)	(0.6)	-	757.3	649.9	6.6	656.5
TRANSACTIONS WITH SHAREHOLDERS:
- Appropriation of profit for 2018:
Retained earnings	-	-	-	-	-	237.9	-	(237.9)	-	-	-
Dividends	-	-	-	-	-	-	158.2	(468.7)	(310.5)	-	(310.5)
- Interim dividend 2019	-	-	-	-	-	-	(169.2)	-	(169.2)	-	(169.2)
Total transactions with shareholders	-	-	-	-	-	237.9	(11)	(706.6)	(479.7)	-	(479.7)
Other changes	-	-	-	-	-	0.9	-	-	0.9	-	0.9
Total other changes	-	-	-	-	-	0.9	-	-	0.9	-	0.9
EQUITY AT 31 DECEMBER 2019	442.2	88.4	20	(151.9)	725.2	2,478.30	(169.2)	757.3	4,190.30	41.6	4,231.90


31 DECEMBER 2017 - 31 DECEMBER 2018
GROUP’S SHARE CAPITAL AND RESERVES											(€m)
	SHARE CAPITAL	LEGAL RESERVE	SHARE PREMIUM RESERVE	CASH FLOW HEDGE RESERVE	OTHER RESERVES	RETAINED EARNINGS/ (ACCUMULATED LOSSES)	INTERIM DIVIDEND	PROFIT FOR THE YEAR	EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT	EQUITY ATTRIBUTABLE TO NON- CONTROLLING INTERESTS	EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT AND NON-CONTROLLING INTERESTS
EQUITY AT 31 DECEMBER 2017	442.2	88.4	20	(12.7)	724.7	2,001.70	(149.3)	688.3	3,803.30	25.7	3,829.00
Change in accounting standards	-	-	-	-		(3)	-	-	(3)	(0.6)	(3.6)
RESTATED EQUITY AT 1 JANUARY 2018	442.2	88.4	20	(12.7)	724.7	1,998.70	(149.3)	688.3	3,800.30	25.1	3,825.40
PROFIT FOR THE YEAR								706.6	706.6	5.0	711.6
OTHER COMPREHENSIVE INCOME:
- Change in fair value of cash flow hedges	-	-	-	(32.1)	-	-	-	-	(32.1)	-	(32.1)
- Actuarial gains/(losses) on employee benefits	-	-	-	-	0.9	-	-	-	0.9	-	0.9
- Gains/(Losses) from translation of financial statements in currencies other than the euro	-	-	-	-	-	(4.8)	-	-	(4.8)	-	(4.8)
- Financial assets at fair value through other comprehensive income	-	-	-	-	1.1	-	-	-	1.1	-	1.1
- Cost of hedges	-	-	-	(1.8)	-	-	-	-	(1.8)	-	(1.8)
Total other comprehensive income	-	-	-	(33.9)	2	(4.8)	-	-	(36.7)	-	(36.7)
COMPREHENSIVE INCOME	-	-	-	(33.9)	2	(4.8)	-	706.6	669.9	5.0	674.9
TRANSACTIONS WITH SHAREHOLDERS:
- Appropriation of profit for 2017:
Retained earnings	-	-	-	-	-	246.1	-	(246.1)	-	-	-
Dividends	-	-	-	-	-	-	149.3	(442.2)	(292.9)	-	(292.9)
- Interim dividend 2018	-	-	-	-	-	-	(158.2)	-	(158.2)	-	(158.2)
Total transactions with shareholders	-	-	-	-	-	246.1	(8.9)	(688.3)	(451.1)	-	(451.1)
Contribution of newly acquired companies	-	-	-	-	-	-	-	-	-	4.9	4.9
Other changes	-	-	-	-	-	0.1	-	-	0.1	-	0.1
Total other changes	-	-	-	-	-	0.1	-	-	0.1	4.9	5.0
EQUITY AT 31 DECEMBER 2018	442.2	88.4	20	(46.6)	726.7	2,240.10	(158.2)	706.6	4,019.20	35	4,054.20

Consolidated statement of cash flows
(€m)

	2019	2018
PROFIT FOR THE YEAR	763.9	711.6
ADJUSTED BY:
Amortisation, depreciation and impairment losses /(reversals of impairment losses) on non-current property, plant and equipment and intangible assets*	577.6	545
Accruals to provisions (including provisions for employee benefits) and impairment losses	30.3	43.2
(Gains)/Losses on sale of property, plant and equipment	(12.9)	(3.5)
Financial (income)/expense	75.2	91.5
Income tax expense	311.9	296.1
CASH FLOW FROM OPERATING ACTIVITIES BEFORE CHANGES IN NET WORKING	1,746.00	1,683.90
Increase/(decrease) in provisions (including provisions for employee benefits and taxation)	(69.5)	(54.5)
(Increase)/decrease in inventories	12.5	(0.4)
(Increase)/decrease in trade receivables and other current assets	(111.9)	129.2
Increase/(decrease) in trade payables and other current liabilities	(10.5)	62.7
Increase/(decrease) in other non-current liabilities	427.5	128
(Increase)/decrease in other non-current assets	-178.6	(115)
Interest income and other financial income received	24.1	5.0
Interest expense and other financial expenses paid	(225.3)	(230)
Income tax paid	(318.9)	(302.3)
CASH FLOW FROM OPERATING ACTIVITIES [A]	1,295.40	1,306.60
- of which related parties	14.3	24,1
Investments in non-current property, plant and equipment after grants received	(1,121.00)	(992.5)
Revenue from sale of non-current property, plant and equipment and intangible assets and other movements	19.2	12.7
Capitalised financial expenses	12.1	15.1
Investments in non-current intangible assets after grants received	(81.2)	(56.4)
Recognition of intangible assets and property, plant and equipment from new acquisitions	-	(17.6)
(Increase)/decrease in investments in associates	(3.3)	1.8
CASH FLOW FOR INVESTING ACTIVITIES [B]	(1,174.20)	(1,036.90)
- of which related parties	(4.4)	(14.7)
Increase/(decrease) in retained earnings and accumulated losses (change in accounting standards)	-	(2.9)
Dividends paid	(475.2)	(451.1)
Movements in short- and medium/long-term financial liabilities (including short-term portion)**	192	(78.8)
Movements in short-term financial investments	(109.5)	(401.5)
Recognition of non-controlling interests in equity of newly acquired companies	-	4.9
Increase/(decrease) in equity attributable to non-controlling interests	-	(0.6)
CASH FLOW FROM FINANCING ACTIVITIES [C]	(392.7)	(930)
- of which related parties	(500)	-
INCREASE/(DECREASE) IN CASH AND EQUIVALENTS [A+B+C]	(271.5)	(660.3)
Cash and cash equivalents at beginning of year	1,328.90	1,989.20
Cash and cash equivalents at end of year	1,057.40	1,328.90