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Hera Spa and its subsidiaries (the Hera Group) operate mainly in Italy in the waste management (waste management and treatment), water (aqueduct, sewerage and purification) and energy (distribution and sale of electricity, gas and energy services) sectors; it also offers services for public lighting and telecommunications. The consolidated financial statement at 31 December 2022 was prepared in compliance with Regulation (EC) No. 1606/2002 of 19 July 2002, observing the International Accounting Financial Reporting Standards (IFRSs) issued by the International Accounting Standard Board (IASB) and endorsed by the European Commission, as well as the provisions enacted in implementing Article 9 of Italian Legislative Decree no. 38/2005. IFRSs also include the International Accounting Standards (IAS) currently in force, the interpretative documents issued by the International Financial Reporting Standards Interpretation Committee (IFRSIC) and the previous Standing Interpretation Committee (SIC). The directors considered the applicability of the assumed going concern in drafting the consolidated financial statement, and decided that such assumption is appropriate in that there are no doubts about the going concern. This assessment took into account the current context provoked by the conflict between Russia and Ukraine. Sufficient obligatory information to present a true and fair view of the Group\u2019s capital-financial conditions as well as its economic performance. Information on the Group\u2019s activities and on significant events after year end is provided in the Directors\u2019 report, in paragraph 1.03 \u201cMain significant events\u201d. The general principle adopted in preparing these consolidated financial statements is the cost principle, except for the financial assets and liabilities (including the derivative instruments), which were measured at fair value. In drawing up the consolidated financial statements, management was required to use estimates; the major areas characterised by valuations and assumptions of particular significance together with those having notable effects on the situations accounted for here are provided in the paragraph \u201cSignificant estimates and valuations\u201d at the end of this section. These consolidated financial statements at 31 December 2022 were drawn up by the Board of Directors and approved by the same at the meeting held on 21 March 2023. These financial statements were audited by Deloitte & Touche Spa. Financial statement content and format These consolidated financial statements comprise: \u25aa primary reporting formats; they are the same as those used for the consolidated financial statements for the year ended 31 December 2021 and have the following features: \u2013 the income statement includes individual items analysed by type. We believe that this type of presentation, which is also used by our major competitors and is in line with international practice, best represents company results; \u2013 the statement of comprehensive income is presented in a separate document and distinguishing items that may and may not be reclassified subsequently to profit and loss. \u2013 the statement of changes in net equity reports separately the other items of the comprehensive income statement; \u2013 the statement of financial position makes the distinction between current and non-current assets and liabilities. \u2013 the cash-flow statement has been prepared using the indirect method; \u25aa explanatory notes; compared with 31 December 2021, the explanatory notes have been reorganized by aggregating them by topic covered, in order to make the information presented more effective and organized. In any case, direct references to the financial statement formats have been retained. 2.02 2.02.01
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Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 125|
In the financial statements any non-recurring costs and revenues are indicated separately. Moreover,
with reference to Consob resolution 15519 of 27 July 2006 on financial statements, specific
supplementary formats of income statement, statement of financial position and cash flow statement
have been included, highlighting the most significant balances with related parties, in order to avoid
altering the overall clarity of the financial statements.
The financial statement formats and the information included in the explanatory notes are expressed in
millions of euro with a decimal point, unless otherwise indicated.
Scope of consolidation
The consolidated financial statements at 31 December 2022 include the financial statements of the
Parent Company Hera S.p.A. and those of its subsidiaries. Control is obtained when the Parent Company
has the power to determine the financial and operational policies of a company, by way of currently valid
rights, in such a way as to obtain benefits from the company\u2019s activity. Equity investments in joint
ventures in which the Hera Group exercises joint control with other companies as well as the companies
over which the Group exercises significant control are consolidated with the equity method.
Small-scale subsidiaries and associated companies are excluded from overall consolidation and valued
at fair value. These companies are reported in note 26, item \u201cOther shareholdings\u201d.
Changes in the scope of consolidation
The table below shows changes in the scope of consolidation introduced during the 2022 financial year
as compared to the consolidated financial statements at 31 December 2021:
Acquisition of control
Company/business unit
Alibardi Fiorenzo Srl
Con Energia Spa
Macero Maceratese Srl
\u201cBfeng\u201d business unit
\u201cNonantola\u201d business unit
Exited the scope
Company/business unit
Vegri Scarl in liquidation
For an overview of the control acquisition transactions carried out during the period, see Section 1.03
\u201cMain Events Occurred\u201d of the Directors\u2019 Report and the \"Business Combinations (supplementary
information)\" section of Section 2.2.10 \"Other Information\" for accounting considerations and the
valuation details of assets and liabilities acquired.
On 12 July 2022, the shareholder\u2019s meeting of Vegri Scarl authorised the act of early dissolution of the
company. The liquidation process was completed in the month of November and the company was
removed from the applicable commercial register.
Changes in equity investments
On 16 December 2021, the shareholder\u2019s meeting of Feronia Srl authorised, pursuant to Article 2482-ter
of the Italian civil code, the coverage of the losses for the financial period, as well as the reconstitution
of the share capital in the amount of 100,000 euro by means of cash injections. Following the failure of
the minority shareholder to exercise the capital increase option, Herambiente Spa, on 31 January 2022,
also took on the latter\u2019s share, becoming the sole shareholder of Feronia Srl.
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Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 126|
On 12 January 2022, Atlas Utilities EAD purchased from a minority shareholder 500 ordinary shares of
Primagas AD, equal to 0.43% of the share capital. The percentage of participation in the latter increased
from 96.9% to 97.34%.
On 18 January 2022, the parent company Hera Comm Spa acquired a minority stake of 16% in Hera
Comm Marche Srl, thereby becoming the sole shareholder.
The difference between the adjustment of these minority shareholdings and the fair value of the
equivalent amount paid was reported directly in net equity and attributed to the parent company\u2019s
shareholders.
Other corporate operations
On 7 February 2022, the shareholder TEA Spa sold its stake in Sinergie Italiane Srl in liquidation to the
remaining shareholders on a pro rata basis, leaving the company. As a result of this transaction,
EstEnergy Spa changed its shareholding from 31% to 32.56%.
On 14 June 2022, the plan to merge Ascopiave Energie Spa, Ascotrade Spa and Blue Meta Spa into the
parent company EstEnergy Spa and Amgas Blu Srl into the parent company Hera Comm Spa was
approved. The merger took place on 1 October 2022, with accounting effects backdated to 1 January
2022.
On 1 December 2022, with effect from 23 December 2022, Ascopiave Spa transferred to Hera Comm
Spa a stake in EstEnergy Spa equal to 8% of the share capital, following the partial exercise of the put
option it held. As a result of this transaction, Hera Comm Spa increased its stake in EstEnergy Spa from
52% to 60%, but with no effect on minority interests, since the Group\u2019s policy is to not expose minority
interests when there is a put option, since the related financial debt for the purchase of these is already
exposed.
Accounting policies and consolidation principles
The financial statements used for the preparation of the consolidated statement of financial position and
income statement schedules were those which the companies included within the scope of consolidation
reclassified and adjusted (on the basis of specific instructions issued by the Parent Company) for the
purposes of consistency with the accounting standards and principles of the Group. In processing the
values referred to the companies valued at net equity, adjustments to their respective financial
statements were considered in order to adapt them to IFRS standards, in case these companies do not
adopt them.
When drawing up the consolidated statement of financial position and income statement schedules, the
assets and liabilities as well as the income and expenses of the companies included in the scope of
consolidation are included on a line-by-line basis. However, the receivables and payables, income and
expenses, gains and losses resulting from operations carried out between companies included in the
scope of consolidation have been eliminated. The book value of the equity investments is eliminated
against the corresponding portion of investees\u2019 shareholders\u2019 equity.
On first-time consolidation, the positive difference between the book value of the equity investments and
the fair value of the assets and liabilities acquired, was allocated to the asset and liability items and on a
residual basis to goodwill. The negative difference was immediately recorded in the income statement,
as illustrated in the following section \u201cBusiness combinations\u201d.
The total of capital and reserves of subsidiaries pertaining to non-controlling interests is recorded within
equity in the line item \u201cNon-controlling interests\u201d. The portion of the consolidated result relating to non-
controlling interests is recorded in the account \u201cMinority shareholders\u201d.
The valuation of the financial statement items has been carried out on the basis of the general criteria of
prudence and on an accrual basis, with a view of the business as a going concern. For the purposes o f
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Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 127|
the accounting entries, priority is given to the economic substance of the transactions rather than their
legal form.
In preparing these consolidated financial statements, the accounting policies and principles were the
same as those adopted in the previous year, considering the new accounting standards reported in the
section \u201cChanges to accounting standards\u201d of section 2.02.10 \u201cOther information.\u201d As far as the income
statement is concerned, the costs and revenues stated include those recorded at year-end, which have
a balancing entry in the statement of financial position. In this regard, income is included only if realised
by said year-end date, while account has been taken of the risks and losses even if known after said
date.
The transactions with minority shareholders are recognised as equity transactions. Therefore, for
purchases of additional shares after control is attained, the difference between the cost of acquisition
and the book value of the shares purchased from non-controlling interests is recognized in Group net
equity.
The functional and presentation currency adopted by the Group is the euro. The assets and liabilities of
foreign companies denominated in currencies other than the euro which are included in the scope of
consolidation are translated using the exchange rates prevailing on the balance sheet date. Income and
expenses are translated at the average exchange rate for the year. Exchange rate differences are
included in a reserve until the relevant foreign operation is sold. The main exchange rates used to convert
the value of the investees outside the Euro zone are as follows:
2022
31 Dec 22
2021
31 Dec 21
Average
Specific
Average
Specific
Bulgarian Lev
1.9558
1.9558
1.9558
1.9558
Polish Zloty
4.6861
4.6808
4.5650
4.5970
The criteria and principles adopted are outlined here below.
Tangible assets - Tangible assets are recorded at cost or production cost, including accessory costs,
or at the value based on expert appraisals, if relating to purchased companies, net of the related
accumulated depreciation and any impairment. The production cost includes the portion of direct and
indirect costs reasonably attributable to the asset (e.g. personnel costs, transport, customs duty, costs
for the preparation of the installation location, final test & inspection costs, notary fees, land registry
expenses). The cost includes any professional fees and, for certain assets, capitalised financial charges
up to the moment the asset enters into service. The cost also comprises the possible costs for
dismantling, recovering and reclamation of the site that hosts the item of property, plant and equipment,
if it complies with the provisions of IAS 37. Ordinary maintenance costs are charged in full to the income
statement. Improvement, upgrading and transformation costs which increase the value of the assets are
recorded as assets.
The book value of intangible assets is subject to assessment so as to identify any losses in value,
particularly when events or changes in circumstances indicate that the book value cannot be recovered
(for details, see the section \u201cLosses in value\u201d).
Depreciation starts to be applied when the assets enter the production cycle. Tangible assets are
classified as in progress when the process of economic use has not yet begun. The property, plant and
equipment are systematically depreciated in each accounting period using the depreciation rates
considered representative of the remaining useful lives of the assets.
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Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 128|
The rates of the amortisation for tangible assets are outlined here below:
Category
rates
Buildings
1.8% - 2.8%
Distribution plants
1.4% - 5.9%
Production plants
2.5% - 25.0%
Other plants
3.9% - 7.5%
Equipment
5.0% - 20.0%
Electronic machines
16.7% - 20.0%
Vehicles
10.0% - 20.0%
The estimated useful lives of tangible assets are reviewed each year so as to assess the need to revise
them. In the event that the estimated useful lives do not provide a truthful representation of the expected
future economic benefits, the relative depreciation schedule must be redefined according to the new
assumptions. These changes are made prospectively to the income statement.
Land is not depreciated, with the exception of land in which landfills are located, which is depreciated
based on the quantity of waste disposed of with respect to the total conferrable capacity.
Gains and losses on disposal of assets are calculated as the difference between proceeds from the sale
and the book value of the relevant investment and are recognized in the income statement as the control
of the asset is transferred to the buyer.
Investment property - An item of property is recognized as investment property when it generates cash
flows largely independently of the other assets held by the Company, as it is held to earn rentals and/or
for capital appreciation or both, not to be utilized in production of for the provision of goods or services
or in connection with company operations. As permitted by IAS 40, investment property has been
recognized at cost. As such, these assets are reported at cost minus depreciation and any impairment.
Rights of use - The right of use of a good or service is initially valued by the Group at cost. This cost
includes: (a) the initial value of the lease liability (calculated as outlined in the section \u201cLease liabilities\u201d);
(b) payments related to the lease contract made before the effective date; (c) initial direct costs related
to property, plant and equipment; (d) an estimate of the costs to be incurred by the lessee in dismantling
and restoring the asset.
Service components that may be included in the contract are excluded from projections of future lease
payments and accounted for separately under operating expenses on a straight-line basis.
After the initial recognition, the value of the right of use is reduced by accrued depreciation and
impairment and is adjusted for any restatements of the lease liability. If the lease transfers the ownership
of the underlying asset at the end of the lease term, the right of use is depreciated beginning from the
effective date until the end of the useful life of the underlying asset, otherwise the depreciation is
calculated on the basis of the lease duration.
The asset consisting of the right of use is subject to an impairment test to identify any loss in value.
Intangible assets and goodwill - Intangible assets which are identifiable and can be monitored, and
whose cost can be reliably determined based on the assumption that said assets will generate future
economic benefits, are recorded in the accounts. These assets are stated at cost in accordance with the
policies indicated for property, plant and equipment and, if they have a definite useful life, they are
amortised systematically over the period of the estimated useful life. The depreciation begins when the
asset is available for use or in any case begins to generate economic benefit for the Group. Work in
progress includes costs relating to intangible assets for which the process of economic use has not yet
commenced. If the Intangible assets have an indefinite useful life, they are not amortised but rather
subjected to an annual impairment test, even in the absence of indicators signalling losses in value.
Research costs are recorded in the income statement. Any development costs for new products and/or
processes are booked to the income statement in the year they are incurred, unless their use extends
over several years.
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IT applications are representative of assets that are identifiable and capable of generating future
economic benefits under the control of the Group. These rights are depreciated over their relevant useful
lives.
Concessions mainly comprise the rights associated with networks, plants and other facilities related to
gas and integrated water cycle services managed by the Group and are instrumental to the management
of these services. These concessions were listed as intangible assets even before the IFRIC 12 -
Agreements for concession services - interpretation was first applied.
The depreciation of the concessions are calculated on the basis of the provisions of the respective
conventions, and namely: i) according to a constant rate for the shorter of the following two periods: the
useful life of the assets granted in concession and the duration of that same concession, provided that,
when this concession expires, the outgoing operator is not granted any compensation value (Residual
industrial value, or RIV); ii) according to the useful life of the individual assets if, at the moment the
concessions expire, the assets in question are expected to pass into the hands of the operator.
Public services under concession include the rights over networks, plants and other facilities related to
gas, integrated water cycle, and electricity (with the sole exception of the assets related to the territory
of Modena, which are classified among the assets owned by virtue of the associated acquisition) and
public lighting services (for the latter, except for what highlighted in the following note describing the
accounting principles applied to the \u201cPayables and financing\u201d item) linked to services managed by the
Group. These arrangements are accounted for by applying the intangible asset model provided for the
IFRIC 12 interpretation, since it was considered that the underlying concession arrangements do not
guarantee the existence of an unconditional right in favour of the concessionaire to receive cash or other
financial assets. Construction and improvement services carried out on behalf of the grantor are
accounted for as contract work in progress. Considering that most works are contracted out externally
and that on construction activities carried out internally the job margin cannot be identified individually
from the benefits included in the remuneration for the service, these infrastructures are reported on the
basis of costs actually incurred, net of any contributions paid by the entities and/or private customers.
This category also includes improvements made and infrastructure constructed on the goods
instrumental to the management of these services, which are the property of the Holding Companies (so
called Asset Companies, pursuant to Art. 113 of Legislative Decree no. 267/00), yet managed by the
Group by virtue of business branch leasing contracts. These contracts, in addition to establishing the
fees due, also include clauses governing the restitution of assets, normally maintained, upon payment
of a balance corresponding to the net book value or the Industrial Residual Value (also taking into
account the recovery funds) of these assets.
The depreciation of these rights is carried out based on the useful life of the individual assets, also in
view of the relevant legislation which, in the event of a change in service provider, calls for compensation
to be paid to the outgoing operator in the amount of the Residual Industrial Value (RIV) for assets
constructed under their ownership, or at Net Book Value (NBV), for assets manufactured under a
business unit leasing contract.
The intangible assets acquired following a business combination are recorded separately from goodwill
if their fair value can be reliably determined and are depreciated over the useful life estimated in the
purchase price allocation.
The depreciation begins when the asset is ready for use according to the needs of the corporate
management.
Gains or losses on disposal of intangible assets are calculated as the difference between proceeds from
the sale and the carrying amount of the asset and are recognized in the income statement when the
control of the asset is transferred to the buyer.
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The depreciation rates of intangible assets are outlined here below:
Category
rates
IT applications
20.0%
Patents and trademarks
10.0%
Buildings under concession
1.8% - 3.5%
Distribution plants under concession
1.8% - 10.0%
Other plants under concession
2.5% - 12.5%
Equipment under concession
12.5%
Cost of acquiring new contracts - As required by IFRS 15, incremental costs, represented by
commissions paid to agents for the acquisition of new energy supply contracts, are recognized as
intangible assets and are amortised according to the average useful life of the acquired customers (churn
rate). For this purpose, only the types of commissions related to new customers not present in the
Group\u2019s customer base are recognized.
Business combinations - Business combination operations are accounted for by applying the
acquisition method foreseen by IFRS 3, as a consequence of which the buyer acquires the equity and
takes over the assets and liabilities of the acquired company. The cost of the operation is shown as the
fair value of the transferred assets, liabilities assumed and equity instruments issued in exchange for the
control of the acquired company, as at the date of acquisition. The expenses related to the business
combination are generally recognised in the income statement at the time they are incurred.
Any positive difference between the cost of the transaction and the fair value at the date the assets and
liabilities are acquired is attributed to goodwill (subject to impairment test, as indicated in the following
section). If the process of allocating the purchase price shows a negative difference, such difference is
immediately charged to the income statement at the date of acquisition.
Any consideration subject to conditions set forth in the business combination contract is measured at fair
value on the acquisition date and considered in the value of the consideration paid for the business
combination, for the purposes of calculating the goodwill.
Non-controlling interests on the acquisition date are measured at fair value or according to the pro rata
amount of the net assets of the acquired company. The valuation method selected is stated for each
transaction.
In the case of business combinations that take place in phases, the equity investment previously held by
the Group in the acquired company is valued at the fair value on the date control was acquired and any
resulting profit or loss is recognised in the income statement.
Losses in value (impairment) - As of each balance sheet date and when events or situation changes
indicate that the book value cannot be recovered, the Group takes into consideration the book value of
property, plant and equipment and intangible assets in order to assess whether these assets have
suffered an impairment. If there is any indication in this sense, the recoverable amount of said assets is
estimated so as to determine the total write-down. The recoverable amount is either the fair value, less
sales costs or the usage value, whichever is the greater. Where it is not possible to estimate the
recoverable value of an asset individually, the Group estimates the recoverable value of the unit
generating the cash flows to which said assets belong. Future cash flows are discounted to present value
at a rate (net of taxation) that reflects the current market value and takes into account the risks associated
with the specific business activities.
If the recoverable amount of an asset (or of a cash generating unit) is estimated as lower than the related
book value, the book value of the assets is reduced to the lower recoverable value and the impairment
is booked to the income statement. When there is no longer any reason for a write-down to be
maintained, the book value of the asset (or the unit generating financial flows), with the exception of
goodwill, is restated at the new value deriving from the estimate of its recoverable value; however, this
new value cannot exceed the net book value that the asset would have had if the write-down had not
been made for the loss in value. The write-back of the value is charged to the income statement.
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Investments valued at shareholders\u2019 equity method - Investments entered in this item refer to long-
term investments in associated companies and joint ventures. An associated company is a company
over which the Group is able to exercise remarkable influence, but not control, by means of participation
in the decisions on the financial and operating policies of the investee company. A joint venture is a jointly
controlled arrangement in which the entities that share joint control have rights to the net assets of the
arrangement. Under the equity method, investments are recognised at cost, as adjusted for any changes
following acquisition in the associated companies\u2019 net assets, minus any impairment. The excess price
over the Group\u2019s share of the fair value of an associated company\u2019s identifiable assets, liabilities and
contingent liabilities at the date of acquisition is recognised as goodwill. Goodwill is included in the
carrying amount of the investment and is tested for impairment.
Other investments - This category includes investments that are not included in the scope of
consolidation, including investments in negligible size subsidiaries, associates and joint ventures. For
these investments, upon initial recognition, it is irrevocably determined whether subsequent changes in
fair value are recognised in other comprehensive income; otherwise, changes in fair value are
periodically recognised in profit or loss. This approach does not include equity investments held
exclusively for the purpose of subsequent disposal, whose changes in fair value are recognized in profit
(loss) for the fiscal period. The risk deriving from any losses exceeding the book value of the investment
is recorded in a specific reserve to the extent that the holder is obliged to fulfil legal or implicit obligations
vis-\u00e0-vis the investee company or in any event cover its losses.
Financial assets - The Group classifies financial assets through the business model adopted for
managing them and on the basis of the features of contractual cashflows In relation to the previous
conditions, financial assets are subsequently valued as follows:
\u25aa depreciated cost;
\u25aa fair value of the other comprehensive income components;
\u25aa fair value of the profit (loss) for the fiscal period.
Management determines their classification when they are first recorded.
Receivables and loans - This category includes assets not represented by derivative instruments and
not listed on an active market, from which fixed or determinable payments are expected. Since the
business model generally adopted by the Group provides for the holding of these financial instruments
solely for the purpose of collecting the contractual cash flows, these assets are valued at depreciated
cost on the basis of the effective interest rate method. The value of the assets is reduced on the basis of
the expected losses, using information that is available without unreasonable charges or efforts, including
historical, current and prospective data. Losses determined by an impairment test are recognized in the
income statement, as are any subsequent reversals of impairment losses. These assets are classified
as current assets, except for the portions accruing after 12 months, which are included amongst the non-
current assets.
This category includes, as provided by the interpretation IFRIC 12, the financial assets associated to
those public service under concession for which the Group has the unconditional contractual right to
receive liquidity from the issuer for the construction services rendered. The Group uses the financial
asset model for the contracts of public lighting service provision, in view of their characteristics, in which
increasingly frequently the issuer guarantees the area provider a specific amount, or at any rate an
amount which can be reliably determined, not depending on the use of the infrastructure by the final
customer. Under that model, the financial asset reported in the balance sheet in relation to the issuer for
an amount equal to the fair value of the construction services rendered.
Financial assets at fair value recorded in the comprehensive income components - This category
includes assets, other than derivatives, held by the Group for the purpose of receiving contractual cash
flows (represented by equity and interest payments) or for monetisation through sale. These assets are
valued at fair value, the latter determined by referring to the market prices at the balance sheet date or
using financial measurement techniques and models, recording their change in value in a specific equity
reserve. The changes in value due to the impairment test as well as of profit/loss on the exchange rate
are recorded in the profit (loss) for the fiscal period This reserve is reclassified to income only when the
financial asset is actually sold. Classification as a current or non-current asset depends on
management\u2019s plans and on the real tradability of the security. Those whose sale is expected during the
next 12 months are recorded as current assets.
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Should there be objective proof of indicators of impairment, the value of the assets is reduced to such
an extent as to be equal to the discounted value of the flows that can be obtained in the future. The
impairment previously booked is restored if the circumstances that brought about its recording no longer
exist.
Assets valued at fair value recorded as profit (loss) for the fiscal period - This category includes
the financial assets acquired for short-term trading purposes, in addition to the derivatives, which are
described in the specific paragraph below. The fair value of these instruments is determined by referring
to the market value on the date the registration period ends. Classification under current and non-current
reflects management \u2018s expectations regarding their trading: current assets include those whose trading
is expected within 12 months or those identified as held for trading.
Cash and cash equivalents - The item regarding cash holdings and cash equivalents includes cash
and bank accounts and deposits repayable on demand and other short-term financial investments with
high liquidity that are readily convertible into cash and are subject to an insignificant risk regarding their
change in value.
Trade receivables - These refer to financial assets arising from the provision of goods and services and
are valued at amortised cost, adjusted for any impairment. These assets are derecognized in the event
of sale which transfers all risks and benefits associated with their management to third parties.
Other current assets - These are stated at par value, and possibly adjusted for any losses in value
corresponding to the amortised cost.
Environmental bonds - The Group complies with the various regulations issued in relation to the
environment that require compliance with restrictions established through the use of certificates or bonds.
Therefore, the Group is obliged to meet a need in terms of grey certificates (emission trading) and white
certificates (energy efficiency instruments). The development of markets in which these
bonds/certificates are traded has also made it possible to initiate a trading activity. These bonds are
valued according to the intended use.
The bonds held to meet the company\u2019s requirement are recorded as assets at cost. If the bonds in the
portfolio prove to be insufficient to meet the need, a liability is recorded to guarantee adequate coverage
when the certificates are delivered to the operator. Bonds held for trading are recognised as assets and
are measured at fair value through profit or loss.
Contract work in progress - Where the outcome of a construction contract can be estimated reliably,
contract work in progress is measured on the basis of revenues accrued with reasonable certainty,
according to the percentage of completion method of accounting, so as to apportion revenues and costs
to the relevant financial years in proportion to the stage of completion of the work in question. Contract
revenues, in addition to the contractual payments, include the variations, the price review and the
recognition of the incentives to the extent it is probable that they represent effective revenues which can
be determined reliably.
When the result of a contract cannot be reliably estimated, the revenues referable to the related contract
are recorded solely within the limits of the contract costs incurred which will probably be recovered. The
contract costs are recorded as expenses during the accounting period in which they are incurred. When
it is probable that the total contract costs will be greater than the contractual revenues, the expected loss
is immediately stated at cost.
Inventories - Inventories are recorded at cost, including directly attributable costs, or net estimated
realizable value, whichever is the lower. The cost configurations used for the valuation of stocks are the
average cost measured on a continuous basis (used for raw materials and consumables) and the specific
cost of other inventories. The net realisable value is calculated on the basis of the current costs of the
inventories at year end, less the estimated costs necessary for achieving the sale.
The value of obsolete and slow-moving stock is written down in relation to the possible use or realization,
by means of the provision of a specific materials obsolescence allowance.
Inventories of work in progress are valued at weighted average manufacturing cost for the period, which
comprises the raw materials, the consumables and the direct and indirect production costs excluding
general expenses.
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Share capital - share capital is recorded at par value, reduced, if necessary, by costs directly attributable
to transactions involving the issuing or repurchase of equity instruments.
Treasury shares - treasury shares are recognised as a reduction in shareholders\u2019 equity, and any
differences generated by future purchase or sale transactions are recorded directly as changes in
shareholders\u2019 equity, without passing via the income statement.
Earnings per share - The earnings per share are represented by the net profit for the year attributable
to the shareholders holding ordinary shares, taking into account the weighted average of the ordinary
shares outstanding during the year. The diluted earnings per share are obtained by means of the
adjustment of the weighted average of the shares outstanding, taking into account all the potential
ordinary shares with dilution effect.
Financial liabilities - This item is initially stated at cost, corresponding to the fair value of the liability net
of the transaction costs which are directly attributable to the issue of said liability. Following their initial
recognition, financial liabilities, with the exception of derivatives, are valued on the basis of amortised
cost, using the original effective interest rate method. If the estimates of payments are revised, the
adjustment of the liability is stated as income or expense in the income statement, except for lease
liabilities.
Lease liabilities - As at the effective date of the contract, lease liabilities are calculated as the present
value of payments due, discounted using the interest rate of the lease or, in case it is not easily
identifiable, the marginal lending rate. The payments included in the calculation of the liability are: (a)
fixed payments; (b) variable payments depending on an index or a rate; (c) amounts expected to be paid
to secure the residual value; (d) the exercise price of the purchase option, if any, if the term of the lease
considers it; (e) any penalties for terminating the contract, if the term of the lease considers them.
The marginal lending rate refers to the average rate at which the Group borrows, broken down by
contractual maturity. It is determined annually in the budget on the basis of the final figures for previous
financial year and is applied to contracts signed from 1 January of each subsequent financial year. It is
updated during the period in the event of significant changes to the Group\u2019s average borrowing rate. For
contracts with a life of more than 4 years, the Group uses the medium/long-term borrowing rate, while
for contracts with a life of 4 years or less, the equivalent short-term rate is adopted.
After the initial date, lease liabilities are modified as a result of: a) accrued financial expenses recorded
to the income statement; b) payments made to the lessor; c) any new valuations or changes to the lease
or the revision of the assumptions regarding the payments due to the lessor.
Post-employment benefits - Liabilities related to defined-benefit plans (such as the employee
severance accrued before 1 January 2007) are reported net of any plan assets on the basis of actuarial
assumptions and on an accrual basis, in keeping with the service necessary to obtain benefits. The
liability is valued by independent actuaries. Independent actuaries assess financial liabilities. The liability
is valued by independent actuaries. Actuarial gains and losses are reported as other comprehensive
income/losses. Following Law 296 of 27 December 2006, for companies with more than 50 employees,
the severance amounts accruing after 1 January 2017 qualify as a defined-benefit plan.
Provisions for risks and charges - The provisions for risks and charges comprise the amounts set
aside as recorded in the financial statements on the basis of current obligations (as emerging from past
events) which the Group believes it probably will have to meet. The provisions are set aside on the basis
of the best estimate of the costs required to meet the obligation, as of the balance sheet date (assuming
that there are sufficient elements for being able to make this estimate) and are discounted to present
value when the effect is significant and the necessary information is available. In such event, the
provisions are determined by discounting to present value the future cash flows at a pre-tax discount rate
that reflects the current market valuation and takes into account the risk associated with the business
activities.
When the discounting to present value is carried out, the increase in the provision due to the passing of
time is recorded amongst the financial charges. If the liability relates to property, plant and equipment
(e.g. restoration of sites), the contra-entry to the provision made is an increase of the asset to which the
liability refers; on the other hand, the financial charges are expensed out through the depreciation
process of the item of property, plant and equipment to which the charge refers. The methods envisaged
by IFRIC 1 are adopted if liabilities are recalculated.
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Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 134|
Trade payables - These refer to payables derived from commercial supply transactions and are recorded
at amortised cost.
Other current liabilities - These concern sundry transactions and are stated at nominal value,
corresponding to the amortised cost.
Derivative instruments - The Group holds derivative instruments for the purpose of hedging its
exposure to the risk of interest rate and exchange rate fluctuations and the risk of changes in methane
gas and electricity prices. In relation to said activities, the Group must handle the risks associated with
the misalignment between the index-linking formulas relating to the purchase of gas and electricity and
the index-linking formulas linked to the sale of said commodities. The instruments the Group uses for
handling price risk, both with regards to the price of the goods and the related Euro/Dollar exchange rate,
are aimed at pre-establishing the effects on the sales margins irrespective of the changes in the
aforementioned market conditions.
In relation to commodity derivatives, operations are managed through OTCs - over the counter financial
instruments (index swaps), currency derivatives (forward purchases in dollars), derivative instruments
traded on the regulated platform Eex, as well as through brokerage contracts that provide for the physical
delivery of the underlying (so-called physical contracts). In particular, the accounting method used for
physical contracts varies according to their purpose: contracts related to procurement activities are
subject to the own-use exemption and the related economic effects are recognised on an accrual basis
only at the time of actual delivery, while contracts signed with reference to price or volume risk
management activities are considered derivative financial instruments and measured at fair value from
the time they are signed. Given the nature of physical contracts, in order to give a more consistent
representation of the actual transactions carried out, at the time they become operational, regardless of
their purpose, the settlement is recorded in the income statement either in the item \u201cRevenues\u201d or in the
item \u201cRaw materials and materials\u201d depending on whether the sale or procurement of commodities was
involved.
From an operational point of view, a commercial portfolio has been identified, which includes physical
and financial contracts signed for the management of procurement, and a trading portfolio, which
includes physical and financial contracts signed for speculation, based on pure position taking logics
whenever there is a market opportunity, always within the risk limits defined by the Board of Directors of
the parent company.
The fair-value changes pertaining transactions that, in observance of the risk management policies, meet
the requirements laid down by the accounting standards for hedge accounting treatment are recorded
(in the terms indicated below) as part of the other components of comprehensive income, while those
that despite being entered into for hedging purposes, do not meet the requirements set by the standards
are recognises in profit or loss in the period in which they occur. Operations identified from their outset
as speculative are recognised in profit or loss in the reporting period. Fair value is established with
adequate valuation models for each type of instrument, according to the reference market value as more
fully described below.
For hedge accounting purposes, the Group formally designates and documents the hedging relationship,
its risk management objectives and the strategy pursued, identifying: i) the hedging instrument, ii) the
nature of the risk being hedged, and iii) the way the effectiveness of the hedge will be assessed. The
hedging relationship is effective if: i) there is an economic relationship between the hedging instrument
and the hedged item; ii) the credit risk does not prevail over the changes in fair value resulting from the
economic relationship; and iii) the hedge ratio is the same as the ratio between the quantity of the hedged
item that the Group actually hedges and the quantity of the hedging instrument that the Group actually
uses to hedge that quantity of the hedged item and no imbalance is identified.
For accounting purposes, the hedging transactions are classified as fair value hedges if they cover the
risk of fluctuations in the market value of the underlying asset or liability; or as cash flow hedges if they
cover the risk of changes in cash flows deriving both from an existing asset or liability, or from a future
transaction, including transactions on commodities.
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Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 135|
As far as derivative instruments classified as fair value hedges are concerned, which observe the
conditions for the accounting treatment as hedging transactions, the gains and losses deriving from the
determination of their market value are recognized through profit or loss. The gains and losses deriving
from the adjustment to fair value of the element underlying the hedge are also recognized through profit
or loss.
For instruments classified as cash flow hedges and that qualify as such, the fair value changes are
recorded, only as far as the effective amount is concerned, in a reserve called \u201cCash flow hedge reserve\u201d
through the statement of comprehensive income. This reserve is recorded to income as soon as the
underlying hedged instrument is realised. The change in fair value referring to the ineffective portion is
immediately recorded in the income statement of the period. If the underlying transaction should no
longer be considered highly probable, or the hedging relationship can no longer be demonstrated, the
corresponding portion of the \u201cReserve of derivatives valued at fair value\u201d is immediately reversed to
income.
If, on the other hand, the derivative instrument is sold and therefore the hedging of the risk for which the
transaction was created no longer qualifies as effective, the amount of \u201cReserve of derivatives valued at
fair value\u201d relating to it is kept until the economic effects of the underlying contract arise.
Whenever applicable, the Group adopts the fair value option.
Assets and liabilities held for sale - Assets and liabilities held for sale are those whose value will be
recovered mainly through sale rather than use. Assets and liabilities are classified under this category
the moment the sale operation is considered highly likely and the assets and liabilities are immediately
available for sale in their current condition. These assets are valued at either cost or fair value, whichever
is lower, net of sales costs.
Revenue and cost recognition - Revenues and income are recognized net of returned items, discounts
and rebates, and net of taxes directly related to the sales of products and services rendered. These are
broken down into revenues deriving from operating activities and financial income which accrues
between the sale date and the payment date.
Specifically:
\u25aa revenues from energy, gas and water sales are recognised and recorded at the moment of the
provision of the service and include the services provided but not yet invoiced (estimated on the basis
of historical analyses determined according to previous consumption levels);
\u25aa revenues from the distribution are recognized on the basis of the tariffs paid by the Aeegsi and are
subject to equalization at year end to reflect in accordance with the competence criterion the
compensation recognised by the Authority in relation to the investments made;
\u25aa revenues are booked at the time (or as) the obligation is fulfilled, transferring the promised good or
service to the customer. The transfer occurs when (or as) the customer gains control over the good
or service. The revenue recorded corresponds to the price attributed to the obligation to be recorded.
Revenue is recorded only if the consideration for the goods or services transferred to the customer
is likely to be received;
\u25aa costs are accounted for in accordance with the accruals principle.
Grants - Capital grants are recognized in the income statement over the period necessary for correlating
them to the related costs. They are represented in the statement of financial position by recording the
grant as deferred revenue. Operating grants, including those received from users for connection
purposes, are considered to be revenues for services rendered during the fiscal period and are therefore
recorded on an accruals basis.
Lease payments - As defined by IFRS 16, lease payments relating to lease contracts for low-value
assets and leases with a contract duration of 12 months or less (short-term leases) are recorded in the
income statement as charges for the period. The Group has set a threshold of 10,000 euro for deeming
the individual underlying asset to be of modest value.
Financial income and expense - Financial income and expense are recognised on an accrual basis.
Dividends from \u201cOther shareholdings\u201d are recorded in the income statement, at the time the right to
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Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 136|
receive payment is established, the economic benefits arising from the dividends are likely to be received
by the Group and their value can be assessed reliably.
Taxes - Taxes are the sum of current, deferred and possible substitute taxes. Current taxes are
calculated on the taxable income for the financial period. Taxable income differs from the result recorded
in the income statement, as it may exclude both positive and negative components which will be taxable
or deductible in other periods (temporary changes), and components that will never be taxable or
deductible (permanent changes). \u201cCurrent tax liabilities\u201d are calculated on the basis of the tax rates
applicable on the balance sheet date.
In determining tax rates for the period, the Group took into due consideration the effects of the IAS tax
reform introduced by Law 244 of 24 December 2007 and in particular the reinforced derivation principle
established by Article 83 of the TUIR. This regulation calls for entities that use IFRSs to apply, including
in a departure from the provisions of the TUIR, the criteria for the determination, recognition and
classification in the financial statements provided for by said accounting standards.
Deferred taxes are calculated having regard to timing differences in taxation, and are recorded under
item \u201cDeferred tax liabilities\u201d. \u201cDeferred tax assets\u201d are recognised to the extent that the existence of a
taxable income at least equal to the amount of the differences to be offset is considered probable when
the timing differences will reverse. Deferred taxes are determined on the basis of the tax rates foreseen
to be in force during the financial year in which the tax asset will be conferred or the tax liability will be
extinguished, on the basis of tax rates established by provisions in force or substantively in force at the
date of the financial statements. These changes are recognised in profit or loss or in equity, depending
on how the difference in question was originally recorded.
Finally, substitute taxes may be recorded when legal provisions exist that allow the Group to take
advantage of special tax regimes. These are, by nature, non-recurring taxes, which may be attributed to
the Group\u2019s desire to opt or not for the related tax regime.
In the event that the substitute tax is paid pursuant to a tax regulation that allows the balance sheet value
of a utility to be aligned, in whole or in part, with the corresponding tax value of the utility, the Group
proceeds to recognize the total value of future tax benefits (tax assets) and, at the same time, the entire
substitute tax in the financial year in which management makes the decision to take advantage of this
opportunity.
Translation of foreign currency balances - Foreign currency transactions are initially recorded using
the exchange rate in force as of the transaction date. Foreign currency assets and liabilities, with the
exception of fixed assets, are recorded using the exchange rate in force as at the period end date and
the related exchange gains and losses are recognized through profit or loss. Any net gain that might
arise is set aside in a specific restricted reserve until the date of realization.
Transactions with related parties - Transactions with related parties take place on an arms\u2019-length
basis, in observance of efficiency and cost-effectiveness criteria. Some specific transactions are
remunerated on the basis of rates established by ARERA resolutions.
Risk management
Credit risk
The credit risk faced by the Group originates from the broad structure of the client portfolios in the main
business areas in which it operates; for the same reason, this risk is spread out over a large number of
clients. In order to manage the credit risk, the Group established procedures for selecting, monitoring
and evaluating its customer portfolio. The Italian market is the benchmark market.
The Group\u2019s credit management model makes it possible to analytically determine the different risks
associated with the collectability of trade receivables as soon as they arise and progressively according
to their increasing seniority.
This approach allows the company to reduce the concentration and exposure to credit risk posed by both
business and household customers. With regard to receivables from small-sized customers, write-downs
are carried out on the basis of future-oriented analysis regarding the amount of probable future income,
taking into consideration the seniority of the receivables, the type of recovery action undertaken and the
status of the creditor. From time to time, analyses are conducted on the individual credit positions yet to
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Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 137|
be resolved, identifying any criticality, and if the amounts outstanding are uncollectible, in whole or in
part, the related receivables are written down.
Liquidity risk
Liquidity risk concerns the inability to meet the financial obligations taken on due to a lack of internal
resources or an inability to find external resources at acceptable costs. Liquidity risk is mitigated by
adopting policies and procedures that maximise the efficiency of management of financial resources. For
the most part, this is accomplished through the centralised management of cash inflows and outflows
(centralised treasury service); in the prospective assessment of the liquidity conditions; in obtaining
adequate lines of credit; and preserving an adequate amount of liquidity.
The financial planning of requirements, focused on medium-term borrowings, and the availability of
abundant funds in credit facilities, allow effective management of liquidity risk.
Interest rate risk and currency risk on financing operations
The cost of financing is affected by interest rate fluctuations. In the same way, the fair value of financial
liabilities is also subject to interest rate and exchange rate fluctuations.
The Group regularly assesses its exposure to such risks and manages them by means of derivative
financial instruments, in accordance with its risk management guidelines. To mitigate interest rate
volatility risk and simultaneously ensure a correct balance between fixed rate debt and variable rate debt,
the Group has stipulated interest rate derivatives in relation to a portion of its financial liabilities. At the
same time, to mitigate exchange rate volatility risk, the Group has signed foreign exchange derivatives
to fully hedge loans in foreign currencies.
Under these guidelines, derivative financial instruments may only be used to manage its exposure to
interest and exchange rate fluctuations related to cash flows and balance sheet assets and liabilities. .
These policies do not enable speculative activities to be carried out.
Market risk and currency risk on commercial operations
Concerning the wholesale business carried on by Hera Trading Srl, the Group manages risks related to
the misalignment between indexation formulas related to the purchase of gas and electric energy and
the indexation formulas related to the sales of the same commodities (including contracts entered into at
fixed prices) as well as exchange rate risks in case the trading contracts for the commodities are
denominated in currencies other than the euro (U.S. dollar).
In relation to these risks, the Group has set up a number of instruments, including different types of
commodity derivatives (which may also include physical delivery) aimed at pre-establishing the effects
on sales margins irrespective of changes in market conditions. The organisational model adopted and
the supporting management systems make it possible to identify the nature of the operation (hedging vs.
trading) and produce the information required for a formal identification of the purpose of these
instruments. Specifically, from a managerial standpoint, the Group identified a commercial portfolio,
including contracts signed to manage the Group\u2019s procurement activities, and a trading portfolio,
including instruments whose purpose cannot be strictly related to the underlying procurement activities.
For an exhaustive discussion of how the Group analyses, measures, monitors and manages exposure
to these risks, please refer to paragraph 1.02.03 \u201cRisk areas: identification and management of risk
factors\u201d in the management report.
Significant estimates and valuations
Preparation of the consolidated financial statements and related notes requires the use of estimates and
valuations by the directors, with effects on the balance sheet figures, based on historical data and on the
forecasts of specific events that are reasonably likely to occur on the basis of currently available
information. These estimates, by definition, are an approximation of the final figures. Hence the main
areas characterised by valuations and assumptions that could give rise to variations in the values of
assets and liabilities by the next accounting period are set forth below.
Specifically, information is provided on the nature of these estimates and the assumptions on which they
have been based, with indication of the reference book values.
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Recognition of revenues
Revenues for the sale of electricity, gas and water are recognised and accounted for at supply only if the
consideration is expected to be collected. They include the allocation for services rendered between the
date of the last reading and the end of the financial year, but not yet billed. This allocation is based on
estimated of the customer\u2019s daily consumption, based on the historic profile, adjusted to reflect the
weather conditions or other factors which might affect consumption under evaluation.
Provisions for risks
These provisions were made by adopting the same procedures as in previous years, with reference to
reports by the legal advisors and consultants that are following the cases, and on the basis of
developments in the relevant legal proceedings as well as of the updates of the hypotheses concerning
future expenses for post-mortem costs of the landfills, following the revision of the estimated costs
identified by external consultants.
Depreciation
Depreciation is calculated on the basis of the useful life of an asset. The useful life is determined by
Management at the time the asset is recognized in the balance sheet; valuations of the duration of useful
life are based on historical experience, market conditions and the expectation of future events that could
affect the useful life itself, including technological changes. Therefore, the actual useful life might differ
from the estimated useful life.
Impairment test
The Group carries out an analysis of the recoverable value of goodwill as well as of its investment (not
majority investment) in companies holding assets for generating thermoelectric energy, through
impairment tests, at least once a year. This test is based on the calculation of its value in use, which
requires the use of estimates as specified in note 27 of the comments to the financial statement formats.
Deferred tax assets
Accounting for deferred tax assets takes place on the basis of expectations of taxable income in future
years. The evaluation of the taxable income expected for the purposes of accounting for deferred tax
assets depends on factors that may vary over time and significantly affect the recoverability of deferred
tax assets.
Fair value assessment and evaluation process
The fair value of financial instruments, both on interest rates and foreign exchange rates, derives from
market prices. In the absence of prices quoted in active markets, the method of discounting back future
cash flows is used, taking the parameters observed on the market as reference. The fair value of
contracts on commodities are determined using directly observable market inputs, where available. The
methodology for calculating the fair value of these instruments includes the assessment of the non-
performance risk, where relevant. All derivative contracts entered into by the Group are with leading
institutional counterparties.
Fair Value Hierarchy
The financial instruments measured at fair value are classified through a three-level hierarchy based on
the way the fair value was determined, i.e., with reference to the factors used in determining the value:
\u25aa level 1, financial instruments the fair value of which is determined on the basis of quoted prices in
active markets;
\u25aa level 2, financial instruments the fair value of which is determined using valuation techniques that
employ parameters that are directly or indirectly observable on the market. Instruments valued on
the basis of the market forward curve and short term differential contracts are classified in this
category;
\u25aa level 3, financial instruments the fair value of which is determined using valuation techniques that
employ parameters that cannot be observed on the market, using internal estimates exclusively.
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Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 139|
STR
STR
Operational and financial performance
Please note that paragraphs 1.04 and 1.07 of the Directors\u2019 report provide an analysis of the business
management performance for the financial period, also by business area; please refer to these for a
specific analysis of the changes in the main categories of operating expenses and revenues, as well as
the Group\u2019s overall financial management.
The financial results for the year by comparison with the previous year are outlined below.
notes
2022
2021
Revenues
1
20,082.0
10,555.3
Other operating revenues
2
548.2
400.1
Raw materials and materials
3
(16,730.0)
(6,668.5)
Service costs
4
(2,105.8)
(2,464.6)
Personnel costs
5
(601.1)
(592.8)
Other operating costs
6
(74.9)
(66.5)
Capitalised costs
7
82.5
60.8
EBITDA
1,200.9
1,223.8
Amortisation, provisions and depreciation
8
(667.1)
(612.1)
Operating revenues
533.8
611.7
Share of profits (losses) pertaining to joint ventures and
associated companies
9
10.0
13.2
Financial income
10
82.2
82.3
Financial expenses
11
(217.2)
(300.3)
Financial management
(125.0)
(204.8)
Earnings before taxes
408.8
406.9
A breakdown of the most significant economic items by business sector is provided in the section
\u201cReporting by operational sector\u201d under 2.02.10 \u201cOther Information.\u201d
Operating revenues and costs showed a significant increase during the year, due mainly to the significant
increase in energy commodity prices in the reference markets, as well as the change in the scope of
customers served in the energy-sector markets of last resort. The Group EBITDA is an alternative
indicator of performance the definition of which can be found in Section 1.04 \u201cOverview of operating and
financial trends and definition of alternative performance measures.\u201d It was positive in the amount of
1,200.9 million euro, and it decreased as compared to last year mainly due to the more subdued
performance of the electricity business, which suffered from the particularly variable conditions of the
wholesale market and did not benefit in the 2022 financial year, unlike the previous year, from the
contribution of the dispatching services market. This effect was only partially offset by the better results
achieved by the waste management business.
\u201cAmortization, provisions and depreciation\u201d increased both as a result of investments entering into
depreciation and amortization during the year, and as a result of higher allocations to the provision for
bad debts and the provisions for risks and charges.
The significant change in financial management is affected by various events occurring in the current
and previous fiscal years. In the second part of the 2022 fiscal year, the Group underwrote short- to
medium-term loans and short-term cash lines to meet contingent financial needs, particularly related to
the increase in methane gas storage needed to supply its customers for the 2022-2023 thermal year. On
the other hand, during 2021, it is worth mentioning the operation of renegotiating five bonds, which
resulted in the recognition of charges amounting to 82.6 million euro.
2.02.02
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 140| 1 Revenues 2022 2021 Change Revenues from sales and services 19,871.3 10,377.1 9,494.2 Changes in work in progress and semi-finished products 210.7 178.2 32.5 Total 20,082.0 10,555.3 9,526.7 Due to the particular types of activities that the Group oversees, \u201cRevenues from sales and services\u201d include substantial allocations for services provided to end customers and not yet invoiced as of the financial statement date. Below are the values of invoices to be issued pertaining to the reference period in relation to the three commodities most significantly impacted by the estimated year-end accruals. 2022 2021 Change Gas sales 730.2 447.1 283.1 Electricity sales 371.3 283.8 87.5 Water 159.8 132.2 27.6 Total 1,261.3 863.1 398.2 The breakdown of revenues from sales and services by geographical area is shown below. 2022 2021 Change Italy 14,102.2 7,873.9 6,228.3 European Union 2,874.3 924.3 1,950.0 Outside European Union 2,894.8 1,578.9 1,315.9 Total 19,871.3 10,377.1 9,494.2 The revenues generated outside Italy mainly refer to natural gas brokerage activities, the value of which amounted to 5,617.8 million euro at 31 December 2022 (2,405.6 million at 31 December 2021). It should also be noted that, of the total value of revenues, 4,064.6 million refer to counterparties operating in the Dutch TTF market (1,577.4 million at 31 December 2021). For \u201cChanges in work in progress and semi-finished products\u201d, the increase compared to the previous year is mainly attributable to the energy efficiency works the Group carried out for customers, mainly apartment blocks; this business area, developed in line with strategic choices associated with the fight against climate change, increased significantly in the 2022 financial year as well. Revenues from related parties are presented in note no. 2.03.01 \u201cIncome statement as per Consob resolution 15519/ 2006\u201d. 2 Other operating revenues 2022 2021 Change Long-term contracts 397.6 341.9 55.7 Operating grants 52.9 26.9 26.0 Grants related to plants 12.8 12.4 0.4 Gains from asset disposals 0.9 1.2 (0.3) Other revenues 84.0 17.7 66.3 Total 548.2 400.1 148.1
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| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 141|
\u201cLong-term contracts\u201d include revenues generated from the construction or improvement of
infrastructures held in concession as per the application of the accounting model for intangible assets for
public services held under concession.
\u201cOperating grants\u201d increased as a result of gas and electricity subsidies, amounting to 38 million euro,
recognized in the form of tax credits by the series of governmental aid decrees issued over the course
of 2022 to deal with the high energy costs emergency. The remaining part mainly include Fer incentives
recognised by the GSE for energy produced from renewable sources and grants awarded by public
bodies, authorities or institutions for specific projects and activities carried out by the Group.
\u201cGrants related to plants\u201d represent the proceeds for the period associated with the depreciation rate of
the assets subject to grants.
\u201cOther revenues\u201d mainly consist of insurance reimbursements, recovery of fees and white certificates.
White certificates represent the revenues calculated on the basis of energy efficiency objectives as
established by the GSE and regulated in relation to the Cassa per i Servizi Energetici e Ambientali,
amounting to 14.5 million euro at 31 December 2022. The change from the comparison period is mainly
due to the negative adjustment of white certificate revenue recognized at 31 December 2021 in
compliance with the provisions introduced in May 2021, which both set a significantly lower number of
certificates for the 2021 obligation than in previous periods and retroactively reduced the number of
certificates planned for the 2020 obligation year by 60%.
3 Raw materials and materials
2022
2021
Change
Raw materials earmarked for sale
16,725.0
6,612.1
10,112.9
Plastic materials
93.6
65.8
27.8
Materials for industrial use
41.4
35.9
5.5
Environmental certificates
35.1
(23.5)
58.6
Charges and revenues from derivatives
(371.4)
(175.7)
(195.7)
Maintenance and other materials
206.3
153.9
52.4
Total
16,730.0
6,668.5
10,061.5
\u201cRaw materials earmarked for sale\u201d, net of changes in stocks, include supplies of natural gas, electricity
and water. The natural gas brokerage business on the Dutch TTF market generated costs of 4,364.9
million euro (1,690.3 million euro at 31/12/2021). The increase in the period is driven by the sharp rise in
energy commodity supply prices to which is added the increase in volumes marketed to electricity end
customers. These effects are only partially offset by the decrease in total gas volumes purchased by the
Group in the 2022 financial year, in relation to the significant reduction in brokering activities in wholesale
markets, only partially mitigated by the higher volumes handled in the gas markets of last resort and the
awarding of Consip tenders.
\u201cPlastic materials\u201d, net of changes in stocks, include the cost of purchasing plastic raw materials destined
for subsequent processing, transformation and sales as part of the Aliplast Spa company activities. The
change in costs is consistent with the increase in sales revenue due to the performance of the plastics
market which showed a significant price increase for both virgin and, to a larger degree, recycled polymer
as compared to the same period of the previous year.
\u201cMaterials for industrial use\u201d mainly include the procurement of methane gas and electricity to power the
Group\u2019s production plants, as well as the purchase of fuels and lubricants for fleet management.
\u201cEnvironmental certificates\u201d include the purchase cost of white certificates, which are supplied in
accordance with the obligations assigned to the distribution companies. This item also includes the
environmental certificates in stock, mainly made up of white and grey certificates as well as the
valorisation of commitments for purchasing electricity from renewable sources in relation to contracts
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 142|
signed with end customers and greenhouse gas emission allowance trading contracts. The significant
change from the previous fiscal year is due to the income recorded in 2021 in correlation with the
reduction of the liability for the 2020 obligation that the legislature retroactively applied, as described in
Note 2 \u201cOther operating revenues\u201d.
\u201cMaintenance and other materials\u201d, net of changes in stocks, mainly include consumables used in the
management of the Group\u2019s operating activities and, marginally, products purchased to be resold to end
customers. The significant increase in the period was due to both the effect of higher material sourcing
costs and the greater volume of concession business carried out by the Group, particularly with regard
to the urban sanitation concessions in the Bologna and Modena areas, as well as the development of
the photovoltaic business.
In relation to \u201cCharges and revenues from derivatives\u201d, please see note 29 \u201cDerivative instruments\u201d for
an analysis of the nature and performance of these items.
4 Service costs
2022
2021
Change
Work and maintenance expenses
872.2
646.3
225.9
Waste transportation, disposal and collection
467.6
398.9
68.7
Transport and storage
269.3
1,008.7
(739.4)
Technical services
119.6
65.9
53.7
IT and data processing services
65.5
67.8
(2.3)
Fees paid to local authorities
61.7
64.9
(3.2)
Professional services
43.5
40.8
2.7
Other service costs
206.4
171.3
35.1
Total
2,105.8
2,464.6
(358.8)
\u201cWork and maintenance expenses\u201d refer to the costs for the construction or improvement of
infrastructures under concession pursuant to the application of the accounting model for intangible assets
for public services held under concession, the costs of implementing energy efficiency measures, and
the costs for maintaining the plants managed by the Group. The change from the previous period is due
mainly to the significant development of the business related to energy efficiency improvement work on
apartment buildings.
\u201cWaste transportation, disposal and collection\u201d mainly include the operating costs of urban hygiene and
waste disposal activities. The change from the previous year is the result of both the higher per-unit cost
of services due to the increase in energy commodity prices in general and fuel prices, in particular, and
higher volumes handled, due in part to the acquisition transactions carried out in the second half of the
2021 financial year and in the 2022 financial year.
\u201cTransport and storage\u201d include the costs of transporting and storing gas as well as the costs of
distributing gas and electricity distribution, including system charges. The latter, in particular, represent
cost components charged to end customers and therefore not substantially affecting the Group\u2019s results.
The change from last year is mainly attributable to the negative value of system charges. The substantial
reduction in this item compared to the previous year is due to:
\u25aa regulatory provisions that, to cope with high utility bills driven by sudden rises in energy commodity
prices, starting back in October 2021 and amplified in the following quarters of 2022, introduced a
cancellation of general system charges in the electricity sector applied to specific utilities and
significantly reduced the gas distribution components;
\u25aa the increase in gas and electricity social bonuses credited to certain categories of end customers in
the 2022 financial year. the regulatory provision, in particular, brought about the expansion of the
base of users eligible for rebates, the increase (especially in the last quarter of 2022) of the unit value
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 143|
of applicable social bonuses, and the introduction of an additional negative rate for the UG2c
component, starting in April 2022, as established by ARERA Resolution 148/2022/R/gas.
These effects are only partially offset by the increase in gas transportation costs due to the increased
capacity used by the Group in the 2022 financial year.
\u201cTechnical services\u201d mainly include the costs incurred in carrying out energy efficiency improvement work
on apartment buildings, an area that has grown significantly compared to the previous period.
\u201cIT and data processing services\u201d include costs for maintaining and managing the Group\u2019s IT and
telecommunications infrastructure, as well as corporate applications and cybersecurity systems.
The item \u201cFees paid to local authorities\u201d includes the charges incurred for the use of public owned
networks, fees paid to companies that own these assets for the rent of gas, water and electricity cycle
assets. It also includes, marginally, the fees paid for the use of telecommunications and district heating
networks.
\u201cProfessional services\u201d include charges for commercial, legal, notary, administrative and tax services.
This item includes fees paid for the audit of financial statements and the issuance of certifications.
\u201cOther service costs\u201d include all other costs for services not specified in the above categories. This item
also includes commissions to agents totalling 21.4 million euro (15.5 million euro at of 31 December
2021) and bank commissions in the amount of 15.2 million euro (8.7 million euro at 31 December 2021).
It should also be noted that the item \u201cOther service costs\u201d also includes the instalments relating to short-
term leases and low-value leases, the amount of which is not significant for the 2022 financial period.
5 Personnel costs
2022
2021
Change
Salaries and wages
423.0
415.7
7.3
Social security costs
136.7
133.0
3.7
Other costs
41.4
44.1
(2.7)
Total
601.1
592.8
8.3
The increase as compared to the previous year is mainly connected to:
\u25aa the increase in the number of employees, particularly as a result of new acquisitions during 2022 and
in the second half of the previous year;
\u25aa salary increases provided for in national collective labour agreements.
These effects are partially offset by lower average staff attendance in the 2022 financial year and lower
expenses incurred for termination than in the previous year.
The average and specific number of employees for the period in question, analysed by category, is as
follows:
Average
Specific
2022
2021
Change
2022
2021
Change
Managers
154
154
\u2010
153
154
(1)
Middle managers
580
572
9
593
583
10
Clerks
5,276
5,236
40
5,251
5,197
54
Blue-collar workers
3,441
3,427
14
3,418
3,401
17
Total
9,451
9,389
62
9,415
9,335
80
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 144|
The average cost of labour per capita for 2022 as compared to the 2021 financial period is as follows:
thousand euro
2022
2021
Change
Average cost of labour pro person
64.0
63.0
1.0
6 Other operating costs
2022
2021
Change
Taxation other than income taxes
23.3
21.7
1.6
Fees paid to Institutional Authorities
13.3
13.1
0.2
Losses on the sale and disposal of assets
9.2
9.2
\u2010
Minor charges
29.1
22.5
6.6
Total
74.9
66.5
8.4
\u201cTaxation other than income taxes\u201d mainly relate to taxes on buildings, stamp duties and registration
fees, public area occupation fee, fees related to the landfills managed and excise duties.
\u201cFees paid to Institutional authorities\u201d paid to the regions, land reclamation consortia, sector agencies
and mountain-area communities, mainly regarding the withdrawal and use of water, as well as
maintenance and management costs for hydraulic works. The item also includes fees for the
safeguarding of hydrogeological protection areas in mountain municipalities (as provided for by Regional
government decree 933/2012) and fees paid for the operation of Atersir.
\u201cLosses on the sale and disposal of assets\u201d are mainly composed of divestments that occurred in the
operation of waste treatment plants, gas distribution network meters and facilities serving the integrated
water cycle.
\u201cMinor charges\u201d comprise other residual items including membership fees, indemnities, sanctions and
fines.
7 Capitalised costs
2022
2021
Change
Increase of self-constructed assets
82.5
60.8
21.7
This item includes mainly the labour costs and other charges (such as storage materials and costs for
use of equipment) directly attributable to the Group\u2019s self-constructed assets.
8 Depreciation amortisation and provisions
2022
2021
Change
Depreciation and amortisation
478.6
469.9
8.7
Net provisions
188.5
142.2
46.3
Total
667.1
612.1
55.0
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 145|
The details of the item Depreciation and amortisation are as follows:
Notes
2022
2021
Change
Depreciation
21, 22, 23
477.1
463.3
13.8
Write-downs
21, 22, 23
1.5
6.6
(5.1)
Total
478.6
469.9
8.7
Depreciation includes the depreciation of tangible assets, rights of use and intangible assets.
Write-downs refer mainly to waste treatment business assets.
The details of the item Net provisions are as follows:
Notes
2022
2021
Change
Provisions to the bad debts fund
33
133.9
94.4
39.5
Provisions to risks and charge funds
31
66.6
52.0
14.6
De-provisioning
31, 33
(12.0)
(4.2)
(7.8)
Total
188.5
142.2
46.3
Provisions include value adjustments to the bad debts fund and provisions for risks and charges.
De-provisioning includes the re-verification of funds in view of the fact that the underlying risks no longer
exist.
9 Share of profits (losses) pertaining to joint ventures and associated
companies
2022
2021
Change
Joint venture share of net profits
3.1
3.1
\u2010
Associated companies share of net profits
6.9
10.1
(3.2)
Total
10.0
13.2
(3.2)
The share of profits and losses of joint ventures and associated companies includes the effects
generated by the valuation of the companies included in the scope of consolidation carried out using the
equity method. For details please refer to note 26 \u201cShareholdings\u201d.
10 Financial income
2022
2021
Change
Customers
24.2
28.1
(3.9)
Income from derivatives
18.3
29.3
(11.0)
Income from the disposal of tax credits
16.0
1.5
14.5
Income from valuation at fair value of financial liabilities
11.2
9.5
1.7
Other financial income
12.5
13.9
(1.4)
Total income
82.2
82.3
(0.1)
\u201cCustomers\u201d mainly include interest on payments in arrears attributable to the gas and electricity sales
business.
\u201cIncome from derivatives\u201d includes the effects of both valuation and realization of interest and foreign
exchange derivatives, as detailed in Note 29 \u201cDerivative Instruments.\u201d
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 146|
\u201cIncome from the disposal of tax credits\u201d represents the financial income realized following the transfers
to banking institutions of tax credits resulting from the application of the discount on invoices for energy
efficiency work carried out on behalf of customers who have taken advantage of the 110% super-bonus
rebate. In 2022, in order to ensure efficient cash management and raise resources for operations, the
Group made widespread use of the sale of the 110% super-bonus rebate, a solution only partially utilised
in the 2021 financial period.
\u201cIncome from valuation at fair value of financial assets and liabilities\u201d, this item includes the following:
Notes
2022
2021
Change
Minority shareholders\u2019 put option
19
12.6
0.7
11.9
Bonds
29
\u2010
7.5
(7.5)
Energy efficiency credits
(1.4)
1.3
(2.7)
Total
11.2
9.5
1.7
\u25aa Put options and contingent consideration represent the positive effects of updating the estimates of
liabilities recognized in previous years in connection with one-time acquisition transactions. The value
at 31 December 2022 includes, in particular, the effects of the updated valuation of the debt for the
put option held by Ascopiave Spa on the minority shareholding in EstEnergy Spa, taking into account
the partial exercise of an 8% share;
\u25aa Energy efficiency credits, relating to the market value valuation of receivables related to the
application of the so-called upfront discount to end customers for work covered by the 110% super-
bonus rebate, held by the Group and designated to be sold to financial institutions. For the accounting
treatment of this case, please see the details outlined in note 11 \u201cFinancial expenses\u201d in relation to
the expenses from valuation at fair value of financial assets and liabilities.
The item \u201cOther financial income\u201d includes the following:
Notes
2022
2021
Change
Discounting of non-current financial receivables
18
4.7
5.3
(0.6)
Dividends
4.1
3.5
0.6
Loans
18
2.0
2.1
(0.1)
Write-back of value
25, 27
\u2010
2.2
(2.2)
Other
1.7
0.8
0.9
Total
12.5
13.9
(1.4)
\u25aa Discounting of non-current financial receivables mainly represent the effect of valuation at the
amortised cost the receivables for construction and improvement of assets recorded as part of
applying the financial activity model for public services under concession;
\u25aa Dividends represent the portions of profit distributed by minor unconsolidated holdings, especially
referring to the shareholding in Ascopiave Spa;
\u25aa The item Loans, in line with the previous year, represents interest income on loans granted to
companies valued at net equity and minor investees.
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 147| 11 Financial expenses 2022 2021 Change Expenses from bonds and loans 82.2 73.1 9.1 Factoring charges and transfer of tax credits 47.3 13.3 34.0 Valuation at depreciated cost of financial liabilities 30.0 29.7 0.3 Expenses from derivatives 21.4 34.1 (12.7) Discounting of options and consideration on equity investments 20.7 20.0 0.7 Discounting of provisions 12.5 18.6 (6.1) Expenses from trading \u2010 82.6 (82.6) Expenses from valuation at fair value of financial assets and liabilities (6.3) 25.8 (32.1) Other financial expenses 9.4 3.1 6.3 Total 217.2 300.3 (83.1) \u201cExpenses from bonds and loans\u201d include interest for the period relating to bond instruments issued by the parent company Hera Spa and interest relating to loans provided by the banking system and other financing institutions. The increase compared to the previous year is related to the higher level of debt due to the bond issued in May 2022 and the new loans undertaken during the period. These operations resulted in an increase in expenses that more than offset the savings from the debt optimization operation carried out through the renegotiation of five bonds made in the financial period 2021. \u201cFactoring charges and transfers of tax credits\u201d includes the following: notes 2022 2021 Change Disposals of tax credits 35 33.3 9.9 23.4 Disposals of trade receivables and other operating receivables 14.0 3.4 10.6 Total 47.3 13.3 34.0 Disposals of tax credits represent the expenses realized in the context of transactions involving the disposal of receivables recorded as a result of the application of the upfront discount to customers for energy efficiency measures. The increase compared to the previous year is due to both an increase in the volume of business in this area, which consequently generated more tax credits in the portfolio, and a reduction in transfer prices. The increase in charges related to the assignment of trade and other operating receivables stems mainly from the increase in the volume of receivables disposed of during the year. \u201cValuation at depreciated cost of financial liabilities\u201d include imputed charges necessary to bring the face cost of debt in line with that calculated using the effective interest rate method. The item also includes figurative charges of 1.6 million euro, in line with the previous year, relating to the put option held by Ascopiave Spa on the minority shareholding in Hera Comm Spa, accounted for as a loan (with a nominal value of 54 million euro), as reported in Note 19 \"Financial liabilities.\". \u201cExpenses from derivatives\u201d includes the effects of both valuation and realization of interest and foreign exchange derivatives, as detailed in Note 29 \u201cDerivative Instruments.\u201d \u201cDiscounting of options and consideration on equity investments\u201d mainly includes notional discounting charges related to the fair value valuation of put options granted to minority shareholders, as reported in Note 19 \u201cFinancial liabilities\u201d.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 148|
\u201cDiscounting of provisions\u201d is broken down as follows:
Notes
2022
2021
Change
Post-closure landfills
31
8.0
13.2
(5.2)
Restoration of third-party assets
31
4.1
5.4
(1.3)
Post-employment and other employee benefits
30
0.3
(0.1)
0.4
Plant dismantling
31
0.1
0.1
\u2010
Total
12.5
18.6
(6.1)
Please see the notes to the respective balance sheet items for an analysis of the change in charges for
discounting funds in relation to the comparison year, where significant.
\u201cExpenses from trading\u201d at 31 December 2021 include the net effect of partial repurchase transactions
in relation to five bond issues. These operations had led to the repayment of the debt for the nominal
share repurchased in the amount of 405.5 million euro and the recording of net charges totalling 82.6
million euro.
\u201cExpenses from valuation at fair value of financial assets and liabilities\u201d, this item includes the following:
Notes
2022
2021
Change
Minority shareholders\u2019 put option
19
5.7
0.8
4.9
Bonds
29
0.6
6.4
(5.8)
Energy efficiency credits
35
(12.6)
18.6
(31.2)
Total
(6.3)
25.8
(32.1)
\u25aa Put options and contingent consideration represent the negative effects of updating the estimates of
liabilities recognized in previous years in connection with one-time commercial acquisition
transactions.
\u25aa Bonds represent valuation adjustments, in application of fair value hedging;
\u25aa Energy efficiency credits are related to the measurement at current market value of receivables
related to the application of the upfront discount to end customers for energy efficiency measures,
designated to be sold to financial institutions once the formal process of recognizing the relevant tax
credit is completed. In fact, the accounting policy adopted by the Group stipulates that, at the time of
the actual sale, the final charge associated with the transaction be recorded in the item \u201cFactoring
charges and sales of tax receivables,\u201d proceeding at the same time to terminate the valuation position
opened in the previous year, thereby generating a substantially offsetting effect. The positive value
is only partially offset by valuation charges recognized on loans issued in the 2022 financial year.
The item \u201cOther financial expenses\u201d, residual in nature, includes the following:
Notes
2022
2021
Change
Leases
22
2.6
3.1
(0.5)
Write-downs
27
\u2010
2.4
(2.4)
Other expenses
6.8
(2.4)
9.2
Total
9.4
3.1
6.3
Other expenses mainly include interest for financial intermediation and interest related to payment
deferrals.
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 149| Taxation 2022 2021 Change Earnings before taxes 408.8 406.9 1.9 Taxes (103.5) (34.2) (69.3) Net profit for the period 305.3 372.7 (67.4) Tax rate 25.3% 8.4% The change in the tax amount and consequent increase in the tax rate are due to the exemption transaction carried out in the last fiscal year. In fact, during 2021, there had been a tax realignment of higher values related to eligible goodwill which, specifically, had resulted in the recognition of deferred tax assets in the amount of 79.8 million euro, the write-off of deferred tax liabilities in the amount of 7.2 million euro, against the payment of substitute taxes in the amount of 3% of the value of the realigned goodwill, amounting to 9.2 million euro. In relation to the tax rate for the 2022 financial year, extraordinary tax rebates, in the form of tax credits, introduced for the purchase of electricity and gas had a major impact on the calculation of the tax rate, representing positive untaxed income components amounting to approximately 38 million euro, as well as benefits from the exemption of some higher values generated by company acquisitions. 12 Taxes This item is made up as follows: 2022 2021 Change Current Pre-paid Deferred Total Current Pre-paid Deferred Total IRES 81.0 (13.0) 0.7 68.7 99.4 (82.7) (12.5) 4.2 64.5 IRAP 26.7 (0.7) 1.1 27.1 31.4 (11.9) (2.6) 16.9 10.2 Substitute tax 5.4 \u2010 \u2010 5.4 13.1 \u2010 \u2010 13.1 (7.7) Nonrecurring subsidies 2.3 \u2010 \u2010 2.3 \u2010 \u2010 \u2010 \u2010 2.3 Total 115.4 (13.7) 1.8 103.5 143.9 (94.6) (15.1) 34.2 69.3 The 2022 financial year had a lower current tax burden than the previous year; it should be noted how, against an in-line pre-tax result, in the previous one, the taxable income - and consequently tax burden - of the Group was reduced due to important non-tax-relevant components. Of particular note are the nonrecurring effects arising from the one-time concessions granted to some Group companies, in the form of tax credits, for the purchase of electricity and natural gas, pursuant to Legislative Decree n4/2022, Legislative Decree 17/2022, Legislative Decree 21/2022, known as the \u201cUkrainian Decree,\u201d Legislative Decree 50/2022, Legislative Decree 115/2022, referred to as \u201caiuti-bis,\u201d Legislative Decree 144/2022, known as \u201caiuti-ter,\u201d and Legislative Decree 176/2022, referred to as \u201caiuti-quater\u201d. Deferred tax assets mainly include the net benefit on taxes resulting from the exemption carried out pursuant to Legislative Decree no. 185/2008 (converted into L. 2/2009) of the higher values generated by the acquisition of Vallortigara Spa and Eco Gas Srl; in particular, the exemption of the equity investment in Vallortigara Spa generated tax assets of 6 million euro, against the payment of a substitute tax of 3.3 million euro, while the exemption of the equity investment in Eco Gas Srl yielded tax assets of 3.5 million euro, against the payment of a substitute tax of 2 million euro. It should be noted that, last year, this item included, in addition to the exemption of the higher values arising from the acquisition of Recycla Spa (which recognized tax assets of 6.8 million euro, against the payment of a substitute tax of 3.8 million euro), the tax benefit from the realignment of goodwill, net of the previously mentioned substitute tax paid, amounting to 77.8 million euro. 2.02.03 | Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 150| STR It should also be noted that Legislative Decree 21/2022, in order to curb the effects of the increase in prices and tariffs in the energy sector on businesses and consumers, established for the financial year 2022 an extraordinary solidarity-oriented levy contribution, which the Group has determined to be applicable to its activities in the amount of 2.3 million euro. With reference to the one-time contribution and its possible application to one additional company with respect to what has been recognized as a tax charge, while the Group deems that there is no objective probability of its having to pay the aforementioned contribution (a conclusion supported by the opinion of its tax advisors), albeit in a context of uncertainty surrounding the interpretation of this rule, in order to avoid the application of penalties it considered it appropriate to proceed with the payment of an additional 9.6 million euro, subsequently proceeding to submit a request for reimbursement. Finally, the subsequent Law 197/2022, referred to as Budget Law 2023, changed the subjective scope of this extraordinary contribution, making what Hera Spa had already paid in the amount of 13 million euro no longer due. The same Budget Law 2023 also established a one-time solidarity contribution, in the form of a temporary levy, to be paid during 2023. The levy, unlike ordinary taxes, does not apply on the result produced in the year 2022, but on the profit surplus that emerges from the comparison with previous periods. According to the criteria for determining the tax base under the aforementioned law, it was found that none of the companies in the Group owe this levy. For a more consistent analysis of the tax rate trend, reference should be made to the IRES tax rate reconciliation in the following sections, that is, to paragraph 1.04.01 \u201cIncome statement and investments\u201d of the Directors\u2019 Report, in which both the pre-tax earnings and the tax charge have been adjusted for special items (including the effect from the exemption shown above), in order to determine an adjusted tax rate fully comparable with that of the previous year. The statutory tax rate determined on the basis of the configuration of taxable income for the purposes of IRES is equal to 24%. The reconciliation with the effective rate is shown below. 2022 2021 Nominal effect Percentage effect Nominal effect Percentage effect Earnings before taxes 408.8 406.9 IRES Standard rate (98.1) (24.0)% (97.7) (24.0)% IRAP deduction 0.9 0.2% 0.9 0.2% Ace and super Ace 4.9 1.2% 5.7 1.4% Maxi and hyper depreciation 8.0 1.9% 8.5 2.1% IRES previous years 0.8 0.2% 2.0 0.5% Other changes (increases and/or decreases) 4.6 1.1% (3.0) (0.7)% IRAP and other current taxes IRAP (27.1) (6.6)% (16.9) (4.2)% Exemption 2.6 0.6% 66.3 16.3% Taxes (103.5) (25.3)% (34.2) (8.4)% This reconciliation is performed only in connection with the IRES, given that, as a result of the rules governing the IRAP, reconciliation between the statutory tax rate derived from financial statement information and the effective tax rate is not very meaningful. \u201cExemption\u201d mainly includes the net benefit on IRES taxes resulting from the exemption of the above- mentioned higher valules recognized with the acquisition of Vallortigara Spa and Eco Gas Srl, amounting to 1.6 million and 1 million euro, respectively. The decrease in the item \u201cAce and super Ace\u201d compared to the previous year mainly reflects the end of the window of opportunity to take advantage of the possibilities introduced by Legislative Decree 73/202 regarding the super Ace, that had allowed taxpayers to obtain a significant benefit on the tax rate. This IRES tax rate reconciliation | Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 151| benefit no longer appears to be recognized for the 2022 tax period for which the ordinary Ace rules become applicable again, with reference to all taxable increases. The item \u201cOther changes (increases and/or decreases)\u201d increased compared to last year mainly due to the effect of extraordinary subsidies recognized in the form of tax credits by some of the Group companies against the purchase of electricity and natural gas. These contributions, introduced by the above-mentioned legislative measures enacted several times during the fiscal year, not contributing to the formation of the tax base for the period, positively affected the 2022 tax rate. In determining tax rates for the period, the Group took into due consideration the effects of the IAS tax reform introduced by Law 244 of 24 December 2007, and associated implementational decrees, the Ministerial Decree of 1 April 2009, the Ministerial Decree of 8 June 2011, and the Ministerial Decree of 10 January 2018, to coordinate international accounting standards with the rules to determine the taxable base for IRES and IRAP purposes, as per Article 4, paragraph 7-quarter,of Legislative Decree 38/2005. In particular, the reinforced derivation principle of article 83 of the Consolidated Tax Act (TUIR) was applied, which calls for entities that use IFRSs to use, including in a departure from the provisions of the TUIR, the criteria for the determination, recognition and classification in the financial statements provided for by said accounting standards. 13 Current tax assets and liabilities 31 Dec 22 31 Dec 21 Change Income tax receivables 44.8 20.3 24.5 IRES refund receivables 1.2 0.9 0.3 Total current tax assets 46.0 21.2 24.8 Income tax payables 17.1 24.2 (7.1) Substitute tax payables \u2010 3.7 (3.7) Total current tax liabilities 17.1 27.9 (10.8) \u201cIncome tax receivables\u201d refer to the excess advance IRES and IRAP payments over the tax amount payable. The significant increase over the comparison period reflects, for some relevant companies, a reduction in pre-tax profit compared with previous years. \u201cIncome tax payables\u201d includes provisions for IRES and IRAP made in relation to profit for the period. \u201cSubstitute tax payables\u201d includes payables for possible exemption transactions which have already been approved by management; the deviation from last year is due to the payment made during the 2022 financial year of the tax related to the transaction for the acquisition of the controlling interest in Recycla Spa. 14 Deferred tax assets and liabilities 31 Dec 22 31 Dec 21 Change Pre-paid tax assets 429.8 458.3 (28.5) Offsetting of deferred tax liabilities (189.6) (229.2) 39.6 Substitute tax credit 0.2 0.3 (0.1) Total net deferred tax assets 240.4 229.4 11.0 Deferred tax liabilities 405.3 361.3 44.0 Offsetting of deferred tax liabilities (189.6) (229.2) 39.6 Total net deferred tax liabilities 215.7 132.1 83.6 Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets with the corresponding current tax liabilities.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 152|
The prepaid and deferred taxes relating to the year 2022 refer to the following temporary difference
between the value attributed to assets and liabilities according to accounting criteria and the
corresponding values for tax purposes.
Deferred tax assets
2022
2021
Temporary
changes
Tax effect
(IRES+IRAP)
Equity
changes
Temporary
changes
Tax effect
(IRES+IRAP)
Equity
changes
Pre-paid taxes with effect on the income statement and the statement of comprehensive income
Depreciation
686.0
178.5
701.7
183.1
Provision for bad debts
241.9
57.6
191.8
46.0
Provisions for risks and charges
209.4
56.6
189.2
51.4
Cash flow hedge
202.3
58.3
348.4
100.2
Shareholdings
182.3
51.5
170.1
47.8
Other
117.6
27.4
119.3
29.8
Total tax effect
1,639.5
429.8
0.7
1,720.5
458.3
0.3
Credited (or debited) amount to
the statement of comprehensive
income
(42.9)
99.4
Credited (or debited) amount to
the income statement
13.7
94.6
Deferred tax liabilities
2022
2021
Temporary
changes
Tax effect
(IRES+IRAP)
Equity
changes
Temporary
changes
Tax effect
(IRES+IRAP)
Equity
changes
Deferred taxes with effect on the income statement and statement of comprehensive income
Depreciation
696.6
147.0
779.5
158.1
Cash flow hedge
563.6
161.9
463.4
133.1
Discounted liabilities
105.4
18.8
118.9
23.3
Provisions for risks and charges
34.3
9.9
37.6
10.9
Other
263.1
67.6
149.4
35.9
Total tax effect
1,663.0
405.3
13.3
1,548.8
361.3
19.5
Credited (or debited) amount to
the statement of comprehensive
income
(28.9)
(128.6)
Credited (or debited) amount to
the income statement
(1.8)
15.1
\u201cEquity changes\u201d have no effect on the income statement and the statement of comprehensive income
for the year, as they include the balances of deferred tax assets and liabilities arising from:
\u25aa business combination operations carried out during 2022, in relation to which see the section
\u201cBusiness Combinations (supplementary information)\u201d of section 2.02.10 \u201cOther information\u201d.
\u25aa marginal reclassifications arising between deferred tax assets and liabilities.
\u201cDeferred tax assets\u201d arise from temporary differences between the value attributed to assets and
liabilities according to accounting criteria and the corresponding values for tax purposes. The decrease
for the period is due to the following effects:
\u25aa change for the period of the fair value of commodity derivatives classified as cash flow hedge,
resulting in an asset decrease with a balancing entry in the statement of comprehensive income in
the amount of 41.9 million euro.
\u25aa higher net allocations to the provision for bad debts of major sales companies, resulting in an increase
in tax assets amounting to 11.6 million euro.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 153|
It should also be noted that last year there was a realignment of the book and tax values of goodwill
recognised in the financial statements at 31 December 2019, as provided for by Article 1, paragraph 83
of the 2021 Budget Law. Deferred tax assets were recorded in the financial statements in view of the
high likelihood of generating taxable income in future years which allows for the use of the deductible
temporary difference. In particular, in relation to the assets recorded against the realignment of goodwill,
for which tax regulations provide for annual use on a straight-line basis for a period of 50 years from the
date of recording, management confirms that they are fully recoverable in view of the extension of the
predictability timeframes of the regulated distribution businesses (on the basis of parameters such as the
residual useful life of the assets, the extension of the concessions and their renewal likelihood), the
particularly limited impact of the taxable income required to recover these deferred tax assets on the
overall taxable income generated by the distribution assets with a residual useful life of several decades,
as well as the tax consolidation regime under which the Group operates, which makes it possible to offset
any tax losses across all businesses.
\u201cDeferred tax liabilities\u201d arise from timing differences between reported profit and taxable profit. The item
also includes the significant tax effects of recognising or adjusting assets and liabilities in the
consolidated financial statements.
The increase compared to 31 December 2021 is due to the following effects:
\u25aa change for the period in the fair value of commodity derivatives classified as cash flow hedge,
resulting in a liabilities increase of 28.9 million euro with a balancing entry in the statement of
comprehensive income;
\u25aa off-balance sheet deduction of the tax amortisation of customer list and goodwill resulting from the
exemption of the higher book values implicit in the controlling shareholdings in Ascopiave Energie
Spa, Ascotrade Spa, Blue Meta Spa, Etra Srl and Amgas Blu Srl; in particular, 2022 represents the
first year in which the benefit resulting from the realignment, amounting to 17.2 million euro, will be
enjoyed.
Reporting on tax litigations
IRES, IRAP and VAT
Company
Tax
Description
of litigation
Status
of litigation
Dispu
ted
amou
nt*
Amounts
paid
(including
provisiona
lly)**
Provisio
ns
booked
in the
financial
stateme
nt
Ascotrade Spa
IRES, IRAP and VAT
Notice of assessment for the years
between 2013 and 2017 concerning the
deductibility of a number of components
of the purchase cost of raw material and
the irregular VAT deduction. Notice of
assessment for the year 2018
concerning VAT alone.
For the years 2013 and 2014, following appeals filed
by the Inland Revenue Office against first instance
rulings favourable to the company, proceedings are
pending before the Second-instance Tax Court. For
the year 2015, the judgments annulled the
assessment acts in their entirety and ordered the
Internal Revenue Office to reimburse the costs of the
case. For the years 2016 to 2018, the company filed
an appeal in February 2022.
10.1
0.7
-
Hera Trading Srl
IRES and \u201cRobin Tax\u201d
surtax
Notices of assessment for the years
between 2011 and 2013 (only the latter
for the Robin tax) concerning the
deduction of valuation charges, net of
related income, from commodity
derivatives and environmental
certificates.
Proceedings related to the 2011 and 2013 tax years,
having seen adverse rulings in the first instance, are
still pending in the second instance before the
applicable Tax Courts. For the 2011 tax year, an
accounting expert opinion was requested from the
second-degree Tax Court of Emilia Romagna; for the
2012 tax year, an unfavourable judgment was
rendered to the Taxpayer by the second-degree Tax
Court of Friuli Venezia Giulia. The Company has filed
appeals with the Court of Cassation.
6.6
2.9
-
Herambiente Spa
IRAP
Notices of assessment for the years
from 2009 to 2013, focused on eligibility
for the IRAP \u201ctax wedge\u201d relief in favour
of the company.
In relation to the tax years for which notices were
received, proceedings are pending before the Court of
Cassation following the appeals lodged in each case
by the losing party (the rulings are both favourable and
unfavourable to the company).
4.1
4.1
-
Herambiente Spa
Assessment notices for the non-
application of withholding tax on
dividends distributed to Ambiente
Appeals have been lodged with the appropriate Tax
Court in relation to the proceedings for both years.
5.1
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 154| Witholdings on dividends Arancione U.A. and European Waste Holding Ltd in the years 2016 and 2017 Marche Region Multiservizi Spa IRES and IRAP Notices of assessment for the years 2009 and 2016 with objection to the deduction of the provision to the landfill post management allowance. Proceedings for the years 2009 to 2014, following appeals filed by the losing party against unfavourable rulings (there are rulings both favourable and unfavourable to the company), are pending before the second-instance Tax Court of Ancona. The proceeding for the year 2015 witnessed a ruling favourable to the Company, but the Inland Revenue has lodged an appeal and the Company appeared before the second-degree Tax Court of the Marche Region. Regarding the year 2016, the company has appealed the assessment. 2.5 1.3 0.1 Inrete Distribuzione Spa IRES and IRAP IRES and IRAP notices of assessment for the year 2016 concerning the undue deduction of discounting charges, the erroneous determination of the maxi- amortisation allowance regarding charges ancillary to the installation of smart meters, that is, the undue deduction of employee-related costs for the purposes of calculating IRAP. With regard to the IRAP claim, the Company settled the dispute with the Inland Revenue Office and paid the tax due (of a modest amount). With regard to the two IRES notices against which an appeal was filed, in June 2022 the Tax Court ruled in the first instance in favour of the company, and condemned the Inland Revenue Office to pay expenses. The proceedings are currently pending in the second instance. Amounts paid on an interim basis were refunded following the favourable first instance ruling. 0.3 - - Hera Luce Srl IRES and IRAP Notice of assessment for the year 2013 concerning the deductibility of routine maintenance costs. The company appealed to the second-instance Tax Court of Emilia Romagna against the first instance ruling of the Provincial Tax Commission of Forl\u00ec, which annulled the penalties but confirmed the higher taxes claimed. The date for the appeal hearing has yet to be scheduled. 0.6 0.3 - * \u201credetermined amount\u201d means the original amount of the claim with no interests, unless it was redetermined as a result of judicial conciliation, assessment with adhesion, partial annulment in judicial proceedings or on self-defence. ** the amounts paid include interest, where due. Other taxes Company Tax Description of litigation Status of litigation Disput ed amou nt* Amounts paid (including provisional ly)** Provisio ns booked in the financial stateme nt Herambiente Spa Eco-tax Dispute documents related to the Sommacampagna landfill for the periods 2014-2017. The proceedings are pending before the relevant first- instance Tax Courts for the tax periods of 2014, 2016 and 2017. With respect to the 2015 tax period, a favourable ruling for the company was issued with a recalculation of the penalties. Deadlines for filing an appeal with the applicable second-degree Tax Commission are pending. 7.0 - - Herambiente Spa ICI/IMU Notices of assessment for the years 2008 to 2017 following the re- classification in the real estate registry of the Ferrara waste-to-energy plant. The proceedings were concluded for the 2008-2013 notices with a ruling favourable to the Company, while they are still pending before the first-instance Tax Court for the remaining years. 2.8 - 2.6 Herambiente Spa ICI/IMU Notices of assessment for the years between 2011 and 2020 concerning the classification in the real estate registry of land, facilities and buildable areas located in Ravenna. For the years 2011-2015, the second instance judgment was partially favourable to the company; the deadlines for filing appeals to the Court of Cassation are pending. For the 2016-2020 periods, the first instance ruling was unfavourable to the company, and the case is pending at the second-instance Tax Court. During 2022, the company finished paying what it owed in relation to the 2018 settlement. 2.6 - 2.3 Herambiente Spa ICI/IMU Notices of assessment for the years between 2013 and 2019 concerning the waste to energy plant and the recycling plant located in the municipality of Coriano. For the years 2013-2015, the cases are pending partly in the first instance Tax Court of Rimini (2013) and partly in the second-instance Court of Emilia- Romagna (2014 and 2015). Assessments for the years 2016-2019 with the second-degree Tax Court are pending. 1.2 0.1 1.2 AcegasApsAmga Spa Technical-administrative audit of the Padua and Trieste waste-to-energy plants carried out by the Customs Agency for the years 2012 to 2015 in Proceedings on the Padua waste-to-energy plant are pending in the Court of Cassation following the company\u2019s appeal against the ruling against it on appeal. The Tax Court of Friuli Venezia Giulia upheld 2.1 1.0 -
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 155|
Excise on
self-consumption
relation to the installation of measuring
instruments for detecting electricity
produced and used for self-
consumption and associated payment
of the excise.
the company\u2019s argument in a ruling dated 21 April
2022 in relation to its entitlement to the subsidised
excise tax with regard to the Trieste waste-to-energy
plant.
Notices of assessment for the tax
periods from 2013 to 2017, notified by
the Municipality of Riccione for the
permanent occupation of public land
with waste bins.
The TOSAP proceedings for the years between 2013
and 2016 are pending before the second-instance
Regional Tax Court of Emilia-Romagna, while the
COSAP proceedings for the year 2017 are pending
before the Appeals Court of Bologna. The first-
instance ruling is partially in favour of the company.
1.2
1.2
2.2
Hera Spa
COSAP/TOSAP
COSAP notice of objection for the tax
periods from 2018 and 2019, notified by
the Municipality of Riccione for the
permanent occupation of public land
with waste bins.
The proceedings are pending before the Civil Court of
Rimini.
2.1
-
TOSAP notices of assessment for the
tax years 2014-2018, notified by the
Municipality of Coriano for the
permanent occupation of public land
with waste bins.
The proceedings for the year 2014 are currently
pending before the second-degree Regional Tax
Court of Emilia-Romagna, while the appeal for the
year 2015 is pending before the first-degree Tax Court
of Rimini.
Regarding the notices for 2016, 2017, and 2018, first-
instance hearings have been held and the filing of
rulings is pending.
0.9
-
* \u201credetermined amount\u201d means the original amount of the claim with no interests, unless it was redetermined as a result of judicial conciliation, assessment
with adhesion, partial annulment in judicial proceedings or on self-defence.
** the amounts paid include interest, where due.
With reference to the disputes in question, having consulted its lawyers, the Group has decided to make
the provisions indicated. In cases in which no provision has been made, the alleged violations have been
deemed groundless.
Equity and financial structure
31 Dec 22
31 Dec 21
Change
Net equity
3,644.7
3,416.8
227.9
Net financial debt
4,249.8
3,261.3
988.5
Net financial debt / Net equity
1.17
0.95
Compared to 31 December 2021, shareholders\u2019 net equity increased due mainly to the combination of
the following effects:
\u25aa net income for the year amounting to 305.3 million euro, down from 372.7 million at 31 December
2021;
\u25aa positive change in the other comprehensive income components totalling 153.5 million euro, driven
mainly by changes in cash flow hedge reserves related to gas and electricity commodity transaction
hedges;
\u25aa distribution of dividends in the amount of 193.8 million euro.
Net financial debt is an alternative performance indicator, as monitored by the Group, the definition of
which is reported in Section 1.04 \u201cOverview of operating and financial trends and definition of alternative
performance indicators.\u201d It increased significantly from the previous period; cash generation from
operations for the year, as reported in the cash flow statement in Section 2.01.04, showed a significant
decrease compared to the previous year, amounting to 1,009.7 million euro, due to the significant cash
absorption resulting from the trend in net working capital. In addition, investment activities involved higher
outlays in the financial year 2022 than in the previous financial year, which were necessary to develop
the businesses managed by the company in line with its business plan. For these reasons, the Group
has made use of increased financial debt, mainly by signing short- and medium-term contracts and
issuing a 500 million euro bond. For more details, see Section 1.04.02 \u201cEquity structure and reclassified
financial debt\u201d and Note 19 \u201cFinancial Liabilities\u201d.
2.02.04
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 156|
Net equity
15 Group net equity
31 Dec 22
31 Dec 21
Change
Share capital (nominal value)
1,489.5
1,489.5
\u2010
Treasury share reserve
(38.5)
(29.2)
(9.3)
Share capital increase costs
(0.7)
(0.7)
\u2010
Share capital
1,450.3
1,459.6
(9.3)
Legal reserve
120.3
109.1
11.2
Other reserves
1,409.1
1,269.9
139.2
Components of Comprehensive Income (OCI)
207.1
54.3
152.8
Reserve for treasury share transactions
(43.6)
(26.2)
(17.4)
Reserves
1,692.9
1,407.1
285.8
Profit (loss) for the period
255.2
333.5
(78.3)
Total
3,398.4
3,200.2
198.2
The share capital at 31 December 2022 amounted to 1,489,538,745 ordinary shares with a nominal value
of 1 euro each and is fully paid-up. The number of treasury shares held by the Group at 31 December
2022 was 38,541,380 (29,217,962 at 31 December 2021).
The item reserves consists of:
\u25aa the legal reserve of the parent company Hera Spa, which increased as a result of the allocation of
the previous year\u2019s earnings as resolved by the Shareholders\u2019 Meeting when approving the financial
statements at 31 December 2021;
\u25aa other reserves reflecting the profits generated in previous years and reserves established on capital
contributions or equity investments;
\u25aa components of other comprehensive income (OCI) mainly representing cash flow hedge reserves
related to gas and electricity commodity transaction hedges;
\u25aa the reserve for treasury share transactions reflecting transactions on treasury shares at 31 December
2022. Changes over the course of the financial year generated an overall capital gain in the amount
of approximately 0.1 million euro.
16 Non-controlling interests
31 Dec 22
31 Dec 21
Change
Share capital and reserves
197.4
179.5
17.9
Components of Other Comprehensive Income (OCI)
(1.2)
(2.0)
0.8
Profit (loss) for the period
50.1
39.1
11.0
Total
246.3
216.6
29.7
This item mainly comprises the minority equity interests of the Herambiente Group and the Marche
Multiservizi Group.
With reference to the acquisition of non-total controlling interests carried out in recent years through
business combinations, the contractual agreements entered into by the Group provide for minority
shareholders to be granted irrevocable put options, to be exercised within specific time windows.
According to the provisions of IAS 32, the existence of such a right held by the minority shareholders has
led to the need to classify options on shares/interests in acquired companies held by minority
shareholders in the consolidated financial statements as a financial liability, thus considering the relative
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 157|
shareholdings to be fully owned. For additional details on the calculation of fair value of put option debt,
please refer to note 19 \u201cFinancial liabilities\u201d.
Net income attributable to minority shareholders shows a significant increase over the previous period,
mainly due to the improved results of the energy services and waste treatment businesses, partly as a
result of the acquisitions made in the second half of 2021 and during the 2022 financial year.
Reconciliation statement
The following is a reconciliation between the Parent Company\u2019s separate financial statements and the
consolidated financial statement.
Net Profit
Net equity
Balances as per parent company\u2019s financial statements
271.0
2,530.3
Excess of shareholders\u2019 equity reported in the financial statements for the period
over the carrying amounts of investments in consolidated companies
(6.1)
931.2
Consolidation adjustments:
net equity valuation of companies recognised in the separate financial
statements at cost
(1.3)
44.5
difference between purchase price and corresponding net book equity
(20.7)
(82.1)
elimination of intra-group transaction effects
12.3
(25.5)
Total
255.2
3,398.4
Allocation of third-party holdings
50.1
246.3
Balances as per consolidated financial statement
305.3
3,644.7
17 Earnings per share
2022
2021
Profit or loss for the period attributable to holders of ordinary shares of the parent
entity (A)
255.2
333.5
Weighted average number of shares outstanding for the purposes of calculation of
earnings (loss) per share
basic (B)
1,454,636,032
1,461,238,457
diluted (C)
1,454,636,032
1,461,238,457
Earnings (loss) per share (in euro)
basic (A/B)
0.175
0.228
diluted (A/C)
0.175
0.228
Basic earnings per share are calculated on the operating result attributable to holders of ordinary shares
of the parent company. Diluted earnings per share are equal to the basic as there are no classes of
shares other than ordinary shares and there are no instruments that can be converted into shares.
At the writing of this consolidated financial statement, the share capital of the parent company Hera Spa
consisted of 1,489,538,745 ordinary shares, unchanged from 31 December 2021, which were used in
determining basic and diluted earnings per share.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 158|
Net financial debt
The following is the financial debt prepared in accordance with Guideline no. 39, issued on 4 March 2021
by ESMA, as implemented by Consob in its communication 5/2021 of 29 April 2021. The Group also
monitors its financial performance through the Net Financial Debt indicator, which adds non-current
financial receivables to the regulatory schedule.
notes
31 Dec 22
31 Dec 21
A
Cash holdings
18
1,942.4
885.6
B
Cash equivalents
18
\u2010
\u2010
C
Other current financial assets
18
77.7
29.3
D
Liquidity (A+B+C)
2,020.1
914.9
E
Current financial debt
19
(563.0)
(443.6)
F
Current part of non-current financial debt
19, 22
(108.4)
(99.5)
G
Current financial debt (E+F)
(671.4)
(543.1)
H
Current net financial debt (G+D)
1,348.7
371.8
I
Non-current financial debt
19, 22, 29
(2,553.0)
(1,073.8)
J
Debt instruments
19
(3,197.3)
(2,702.0)
K
Commercial and other non-current payables
\u2010
\u2010
L
Non-current financial debt (I+J+K)
(5,750.3)
(3,775.8)
M
Total financial debt (H+L)
ESMA guidelines 32 \u2013 382 - 1138
(4,401.6)
(3,404.0)
Non-current financial receivables
18
151.8
142.7
Net financial debt
(4,249.8)
(3,261.3)
To better understand the financial dynamics taking place during the course of fiscal year 2022, see the
financial statements and the comments shown in the Directors\u2019 report in paragraph 1.04.02 \u201cEquity
structure and reclassified net financial debt\u201d.
For the schedule of financial debt with related parties, see Section 2.03.04.
The following is an analysis of the balance sheet items included in the determination of net financial debt,
with the exception of financial assets and liabilities related to interest rate derivative financial instruments
which are detailed in Note 29 \u201cDerivative Instruments\u201d and lease liabilities which are shown in Note 22
\u201cRights of Use and Leasing Liabilities\u201d.
18 Financial assets, cash holdings and cash equivalents
31 Dec 22
31 Dec 21
Change
Loan receivables
27.0
35.8
(8.8)
Receivables for construction services
80.4
59.2
21.2
Portfolio securities
2.0
1.9
0.1
Other financial receivables
42.4
45.8
(3.4)
Total non-current financial assets
151.8
142.7
9.1
Loan receivables
7.2
5.8
1.4
Other financial receivables
70.5
23.5
47.0
Total current financial assets
77.7
29.3
48.4
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 159| Total cash holdings 1,942.4 885.6 1,056.8 Total financial assets and cash holdings 2,171.9 1,057.6 1,114.3 \u201cLoan receivables\u201d, comprises loans, regulated at market rate, made to the following companies: 31 Dec 22 31 Dec 21 Non-current portion Current portion Total Non-current portion Current portion Total Aloe SpA 5.4 0.8 6.2 6.1 0.8 6.9 Calenia Energia Spa 3.3 \u2010 3.3 7.1 0.3 7.4 Set Spa 12.2 3.2 15.4 15.4 3.1 18.5 Other minor companies 6.1 3.2 9.3 7.2 1.6 8.8 Total 27.0 7.2 34.2 35.8 5.8 41.6 Loans to companies that are vehicles through which the Group owns production quotas for electricity generation plants (Set Spa and Tamarete Energia Srl) were tested for impairment, the result of which did not lead to changes in the carrying values during the 2022 financial year, as explained in Note 27 \u201cImpairment test equity investments.\u201d \u201cReceivables for construction services\u201d from municipalities for the construction of public lighting systems identified in keeping with the financial asset model provided by the IFRIC 12 interpretation, as shown in greater detail in the section describing the evaluation criteria for the item \u201cLoans and receivables\u201d in section 2.02.01 \u201cIntroduction\u201d. \u201cPortfolio securities\u201d mainly include bonds, funds and insurance policies guaranteeing the post-mortem management of the landfill held by the subsidiary Asa Scpa, amounting to 1.9 million euro, the book value of which is substantially in line with the fair value at the end of the year. These securities are measured at fair value through other comprehensive income components. \u201cOther financial receivables\u201d include the following counterparties: 31 Dec 22 31 Dec 21 Non-current portion Current portion Total Non-current portion Current portion Total Municipality of Padua 12.1 1.5 13.6 13.6 2.2 15.8 Collinare Consortium 13.0 \u2010 13.0 12.1 \u2010 12.1 Acosea Impianti Srl 12.7 \u2010 12.7 12.6 \u2010 12.6 Cato and Veneto Region \u2010 7.0 7.0 \u2010 9.8 9.8 ex-CMV municipalities 3.9 \u2010 3.9 3.9 \u2010 3.9 Other financial receivables 0.7 62.0 62.7 3.6 11.5 15.1 Total 42.4 70.5 112.9 45.8 23.5 69.3 \u25aa The Municipality of Padua is mainly related to the construction of photovoltaic systems. The repayment of this credit, which is regulated at a market rate, is scheduled at the end of 2030; \u25aa The item Collinare Consortium represents the compensation owed to the outgoing provider when the gas distribution services contract comes to an end; \u25aa Acosea Impianti Srl refers to a security deposit left with the parent company Hera Spa; \u25aa Cato and Veneto Region reflects government grants that will be collected after the balance sheet date; \u25aa Ex-CMV municipalities concerns the compensation due to the outgoing operator at the end of the concession of the management of gas distribution service in the municipalities of Vigarano, Goro and Castello d'Argile; \u25aa Other financial receivables include transactions for the assignment of energy efficiency tax credits concluded at the end of fiscal year 2022, formally validated and accepted by the bank counterparties, | Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 160| the collection of which took place in January 2023, amounting to 46.3 million euro. This item also includes advances paid by the Group\u2019s distribution companies for participation in gas tenders to be held in the coming years, amounting to 4.3 million euro (4.7 million euro at 31 December 2021). \u201cCash and cash equivalents\u201d include almost exclusively bank and postal deposits (1,941.8 million at 31 December 2022). To better understand the change in the amount of cash and cash equivalents, please refer to the cash flow statement schedule. 19 Financial liabilities 31 Dec 22 31 Dec 21 Change Bonds and loans 5,171.5 3,105.9 2,065.6 Minority shareholder\u2019 put option 499.5 585.2 (85.7) Payables to acquire controlling shareholdings and potential consideration 17.4 23.0 (5.6) Other financial liabilities 1.5 1.9 (0.4) Total non-current financial liabilities 5,689.9 3,716.0 1,973.9 Overdrafts and interest liabilities 316.6 64.8 251.8 Bonds and loans 87.1 56.1 31.0 Payables to acquire controlling shareholdings and potential consideration 13.3 2.2 11.1 Minority shareholders\u2019 put option 1.7 - 1.7 Other financial liabilities 231.4 376.6 (145.2) Total current financial liabilities 650.1 499.7 150.4 Total financial liabilities 6,340.0 4,215.7 2,124.3 \u201dBonds and loans\u201d for the non-current part, changed mainly due to the overall net effect of the following: \u25aa issuance of the third green bond by the Group, which is part of the sustainability strategy aimed at financing or refinancing various projects, already carried out or planned in the business plan, selected on the basis of the provisions of the Green financing framework. the new bond, which is listed on the regulated markets of the Irish, Luxembourg and Italian stock exchanges, has a nominal value of 500 million euro, a duration of 7 years and an annual coupon of 2.5%. For further details regarding the new issuance, reference should be made to chapter 1.03 \u201cMain significant events\u201d in the Directors\u2019 report; \u25aa use of a medium/long-term credit line, as a term loan bullet granted in pool by the main banks working with the Group, amounting to 450 million euro. This financing is backed by a guarantee issued by Sace Spa (based on Article 15 of Legislative Decree No. 50 of 17 May 2022, subsequently converted into law) and is regulated by a variable interest rate; \u25aa subscription during the year of various loans with leading banks totalling 1,175 million euro, at both fixed and floating rates, with bullet repayment and an average term of approximately two years; \u25aa classification in the current portion of a bond loan with a remaining face value of 22 million euro, maturing in May 2023. The item also includes the value of the put option, in the amount of 54.8 million euro, related to Ascopiave Spa\u2019s 3% minority shareholding in Hera Comm Spa which, as a result of the contractual provisions, is classified as a loan and valued according to the depreciated cost method. This debt, with a nominal value of 54 million euro, increased due to the financial evaluation component and decreased due to dividends paid out: Opening value Financial expenses Flows paid out Terminal value 2021 financial year 54.5 3.2 (2.7) 55.0 2022 financial year 55.0 3.2 (3.4) 54.8 | Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 161| The current portion of \u201cBonds and loans\u201d includes the portions of medium- and long-term debts due within the next fiscal year, as well as the bond coming due in May. The main conditions of the bonds outstanding at 31 December 2022 are as follows: Bonds Duration (years) Maturity Nominal value (mn/\u20ac) Coupon Rate Sustainability linked bond 12.5 25 Apr 2034 500 Eur Annual 1.00% Bond 10 22 May 2023 22 Eur Annual 3.375% Green bond 10 04 Jul 2024 288.3 Eur Annual 2.375% Bond* 15 05 Aug 2024 20,000 JPY Six monthly 2.93% Bond 12 22 May 2025 15 Eur Annual 3.5% Green bond 7 25-mag-2029 500 Eur Annual 2.5% Bond 10 14 Oct 2026 325.44 Eur Annual 0.875% Bond 10 03 Dec 2030 500 Eur Annual 0.25% Bond* 15/20 14 May 2027/2032 102.5 Eur Annual 5.25% Green bond 8 05 Jul 2027 357.2 Eur Annual 0.875% Bond 15 29 Jan 2028 599.02 Eur Annual 5.20% * Unlisted instrument At 31 December 2022, the outstanding bonds, totalling a face value of 3,359.2 million euro (2,859.2 at 31 December 2021) and recorded at discounted cost of 3,221.4 million euro, have a fair value of 2,986.8 million euro (3,100.7 at 31 December 2021) determined by market quotations where available. There are covenants on some loans that require compliance with the corporate rating limit, which must be rated, even only by a single rating agency, no lower than investment grade (BBB-). As of the balance sheet date this covenant has been complied with. \u201cMinority shareholders\u2019 put option\u201d includes the fair value measurement of the sale options that are granted, with specific contractual arrangements, to minority shareholders on their own shares. The most significant value refers to the sale option on the non-controlling shares in EstEnergy Spa, equal to 40% of the share capital, held by Ascopiave Spa. The policy of the Group provides not to represent the holdings of minority shareholders in the result component for the period, therefore in evaluating the value of the debt for the options (to be paid at the date of exercising the option according to the contractual mechanism agreed between the parties) increased of the dividends that are expected to be distributed by the subsidiary companies along the hypothetical life of the options themselves. The fair value recognised as a liability in the balance sheet is therefore not only the present value of the expected price of the put option at the date of it is exercised, but also contains the discounted estimate of future dividends distributed as part of the variable consideration due to the counterparty. Given the structure of the operation, during the period in which the option is exercised, the profit generated by the subsidiary companies will be distributed according to their respective nominal shareholdings. This mechanism means that the portion of the fair value of the put option that will be settled through the distribution of future dividends is actually self-liquidating, since the necessary financial resources (i.e. dividends of non-controlling shareholdings) will be directly generated by the subsidiary companies, without thus determining during that period a real additional financial need for the Group. Bonds Bonds Put option
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 162|
The following are the changes for the year, compared with the previous period:
Opening
value
Acquisitions
Financial
Expenses
Hypothesis
change
Flows
paid out
Terminal
value
31 Dec 21
Put options (equity value)
403.4
21.8
14.5
3.2
\u2010
442.9
Put options (future dividends)
153.0
3.7
5.4
(2.5)
(17.2)
142.3
Total
556.4
25.5
19.8
0.7
(17.2)
585.2
31 Dec 22
Put options (equity value)
442.9
6.9
15.4
35.0
(79.0)
421.2
Put options (future dividends)
142.3
2.2
5.1
(47.6)
(21.9)
80.0
Total
585.2
9.0
20.5
(12.6)
(100.9)
501.2
Regarding the changes occurring during the year:
\u25aa acquisitions result from the extraordinary transactions concluded during the fiscal year that involve
granting the counterparty an option on the non-controlling interest. During 2022, in particular, these
values are attributable to the acquisition of Macero Maceratese Srl and the \u201cNonantola\u201d branch;
\u25aa financial charges include the notional effects of discounting the debt recorded at the previous balance
sheet date;
\u25aa the changes in assumptions represent the effects of updating the values underlying the determination
of the fair value of the options themselves, the period value of which refers to the option on the non-
controlling interests in EstEnergy Spa. Specifically, the fair value of the option is calculated with
reference to the future scenario of exercising the option deemed to be the most likely by the
management, taking into account options that were exercised in part, in line with the updated planning
assumptions, adopting applied multiples to margin indicators in accordance with the conditions
agreed between the parties and discounting the corresponding future cash flows, using as a discount
rate the average cost of the Group\u2019s long-term debt at the date of the transaction. This revised
estimate resulted in the recognition of income from the fair value measurement of financial liabilities
in the amount of 12.6 million euro;
\u25aa the flows paid out include the amounts paid to minority shareholders both for exercising the options
themselves (equity value) and for the payment of dividends belonging to them. During 2022,
Ascopiave Spa partially exercised the put option it held, resulting in the sale to Hera Comm Spa of
8% of the shares in EstEnergy Spa for a countervalue of 79 million euro.
\u201cPayables to acquire controlling shareholdings and potential consideration\u201d include the amounts still to
be paid to transferor shareholders as part of the business combination transactions concluded in the
period or in previous periods, as well as the estimate of the potential payments (earn-out) foreseen by
the agreements signed at the time of the acquisition.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 163|
The following is a breakdown of the item at 31 December 2022 by individual acquisition, compared with
the previous period:
31 Dec 22
31 Dec 21
Non-current
portion
Current
portion
Total
Non-current
portion
Current
portion
Total
Aliplast Spa
17.4
\u2010
17.4
17.4
\u2010
17.4
Macero Maceratese Srl
\u2010
1.1
1.1
\u2010
\u2010
\u2010
Eco Gas Srl
\u2010
\u2010
\u2010
\u2010
0.4
0.4
Payables to acquire controlling
shareholdings
17.4
1.1
18.5
17.4
0.4
17.8
Pistoia Ambiente Srl
\u2010
11.5
11.5
5.6
\u2010
5.6
Aliplast Spa
\u2010
0.5
0.5
\u2010
0.5
0.5
Recycla Spa
\u2010
0.2
0.2
\u2010
1.2
1.2
Other minor companies
\u2010
\u2010
\u2010
\u2010
0.1
0.1
Contingent consideration
\u2010
12.2
12.2
5.6
1.8
7.4
Total
17.4
13.3
30.7
23.0
2.2
25.2
During the year, the estimate of the contingent consideration for the acquisition of control over Pistoia
Ambiente Srl (subsequently merged into Herambiente Spa) was updated in the amount of 5.7 million
euro, recorded under expenses related to changes in the fair value of financial liabilities.
In \u201cOverdrafts and interest liabilities\u201d, the significant change compared with the previous financial period
is due to the underwriting of short-term monetary loans in the form of hot money in the last quarter of
2022, totalling 230 million euro (23.3 million at 31 December 2021), in light of the elevated volatility of
energy markets. These loans were in the initial months of 2023 and, at the same time, the Group did not
take out any further short-term loans given its satisfactory cash position.
\u201cOther financial payables\u201d mainly refer to:
31 Dec 22
31 Dec 21
Non-current
portion
Current
portion
Total
Non-current
portion
Current
portion
Total
European Energy Exchange
\u2010
145.1
145.1
\u2010
266.6
266.6
Factoring
\u2010
61.0
61.0
\u2010
23.1
23.1
Fund for energy and waste
management services
\u2010
20.4
20.4
\u2010
39.0
39.0
Municipal Pension Fund of the
Municipality of Trieste
1.5
0.3
1.8
1.9
0.1
2.0
Other minor items
\u2010
4.6
4.6
\u2010
47.8
47.8
Total
1.5
231.4
232.9
1.9
376.6
378.5
\u25aa European Energy Exchange includes down payments related to power exchange contracts
concluded on the EEX platform, which provides for daily adjustment of differentials. The change is
due to the dynamic increase in energy commodity prices, which has oriented the Group to prioritize
the settlement of expiring contract positions while reducing the underwriting of new positions, turning
instead to other negotiated forms of exchange contracts;
\u25aa Factoring mainly includes collections yet to be transferred to financial institutions at the end of the
year, in relation to receivables subject to non-recourse assignments for which the Group has
maintained collection activities on behalf of factor companies;
\u25aa Fund for energy and waste management services includes revenues to be retroceded as they have
already been advanced by CSEA in relation to the reports made by the Group for the activities carried
out in the gas and electricity sales markets subject to tenders, as detailed in Note 36 \u201cOther current
liabilities\u201d to which please refer for more details;
\u25aa Other minor items decreased significantly due to the payment of 39.4 million euro to the companies
that own the assets, following the conclusion of the tender process at the end of 2021 and consequent
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 164| awarding of the management of the water service in the province of Rimini area, where the Group, although confirmed as provider, was formally obliged as the outgoing operator to pay compensation for the previous award period. The following table shows financial liabilities broken down by nature at 31 December 2022, showing bands of maturity: Type Residual amount 31 Dec 22 Portion due within the period Portion due within 2nd year Portion due within 5th year Portion due beyond 5th year Bonds 3,221.4 21.8 424.4 714.8 2,060.4 Loans 2,037.2 65.3 655.1 1,227.5 89.3 Minority shareholders\u2019 put option 501.2 1.7 16.6 476.7 6.2 Payables to acquire controlling shareholdings and potential consideration 30.7 13.3 \u2010 17.4 \u2010 Other financial liabilities 232.9 231.4 0.3 1.2 \u2010 Overdrafts and interest liabilities 316.6 316.6 \u2010 \u2010 \u2010 Total 6,340.0 650.1 1,096.4 2,437.6 2,155.9 The table below shows the worst-case scenario where assets (cash, financial and trade receivables) are not taken into account, while financial liabilities are shown in the capital and interest portion, trade payables and interest rate derivatives. Financial lines were assumed to be revoked on demand, while loans were assumed to be repaid at the earliest date provided for in the contractual terms. Worst case scenario 31 Dec 22 31 Dec 21 (mn\u20ac) from 1 to 3 months more than 3 months to 1 year from 1 to 2 years from 1 to 3 months more than 3 months to 1 year from 1 to 2 years Bonds 33.0 99.0 511.0 33.0 62.0 87.0 Financial payables and other liabilities 329.6 732.0 91.0 66.8 66.0 62.0 Payables to suppliers 3,093.1 \u2010 \u2010 2,356.6 \u2010 \u2010 Total 3,455.8 831.0 602.0 2,456.4 128.0 149.0 Current cash and lines of credit, in addition to the resources generated by the operating and financing activities, are deemed sufficient to meet future financial needs. The following is a summary of the credit lines available at 31 December 2022, compared with the previous year: 31 Dec 22 31 Dec 21 Committed credit lines 1,230.0 450.0 Uncommitted credit lines 517.0 516.0 Total 1,747.0 966.0 The credit lines are distributed among the leading Italian and international banks and allow for adequate diversification of counterparty risk and competitive conditions. The significant increase in committed lines relates to the signing in December 2022 of a commitment letter committing a pool of banks to provide the Hera Group with a 750 million euro loan backed by a SACE guarantee. Scenario analyses Debt analysis by maturity
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 165|
Sureties and guarantees
31 Dec 22
31 Dec 21
Bank sureties and guarantees
2,780.0
1,870.2
Insurance sureties and guarantees
851.5
676.0
Total
3,631.5
2,546.2
For \u201cBank sureties and guarantees\u201d, the value at 31 December 2022, compared with the previous period,
comprises the following:
31 Dec 22
31 Dec 21
Bank sureties
1,244.4
913.6
Letters of patronage
1,535.6
956.6
Total
2,780.0
1,870.2
Specifically:
\u25aa bank sureties are related to sureties made to public institutions (the Ministry of the Environment and
Energy Security, the regions, provinces and municipalities) and private entities to guarantee the
suitable management of plants for treating and disposing of waste, for the suitable provision of waste
disposal and intermediation services, for reclamation work and for the proper fulfilment of contractual
commitments on wholesale energy commodity markets;
\u25aa Letters of patronage are issued mainly to guarantee the timely payment of raw material supplies.
The increase from the previous year is due to higher guarantees provided for operations in the wholesale
gas and electricity commodity procurement markets, mainly due to the increase in prices of benchmark
commodities.
\u201cInsurance sureties and guarantees\u201d at 31 December 2022 refers to sureties issued to public entities
(provinces, municipalities and the Ministry of the Environment and Energy Security) and third parties to
guarantee the suitable management of public utility and waste disposal services, the proper execution
of the work to lay company pipelines across land owned by private individuals, reclamation work,
managing waste treatment and disposal systems.
Finally, it should be noted that, at 31 December 2022, the Hera Group provided the guarantees for certain
bank loans, in the amount of 11.8 million euro. In particular, these refer to mortgages on buildings
belonging to the company Recycla Spa located in Maniago (PN), Resana (TV) and San Quirino (PN)
and on buildings belonging to the company Marche Multiservizi Spa located in Pesaro and Urbino, lent
to banking institutions that have provided loans to the Group, the residual nominal amount of which at
31 December 2022 totals 4.4 million euro.
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 166| 20 Cash flows related to financing activities Changes in financial liabilities The following is a breakdown of information on changes in financial liabilities during the 2022 financial year, differentiating between cash flows and non-cash flows. Non-cash flows Type 31 Dec 22 31-Dec-21 Change (a) Acquisitions divestitures (b) Economic valuation components (c) Changes in fair value (d) Other changes (e) Cash flows (f)=(a)- [(b)+(c)+(d)+( e)] Non-current financial liabilities 5,689.9 3,716.0 1,973.9 10.6 50.4 (6.3) (128.6) 2,047.8 Current financial liabilities 650.1 499.7 150.4 7.3 0.3 110.9 31.9 Cash flows related to financial liabilities 6,340.0 4,215.7 2,124.3 17.9 50.7 (6.3) (17.7) 2,079.7 of which New issue of long-term bonds 2,127.0 Repayments of non-current financial liabilities \u2010 Repayments and other net changes in financial liabilities (47.3) Lease liabilities 76.4 96.6 (20.2) 1.9 \u2010 \u2010 21.3 (43.4) Financial liabilities generated by financing activities 6,416.4 4,312.3 2,104.1 19.8 50.7 (6.3) 3.6 2,036.3 \u201cAcquisitions and Divestitures\u201d include the effects arising from the control acquisition transactions carried out in the 2022 financial year, as explained in the section \u201cBusiness combination (supplementary information)\u201d in Section 2.02.10 \u201cOther information\u201d. \u201cEconomic valuation components\u201d include: \u25aa charges from the amortised cost valuation of bonds and loans in the amount of 30 million euro, as reported in Note 11 \u201cFinancial expenses\u201d; \u25aa discounting charges related to the put options of non-controlling shareholdings and earn-outs contracted as part of the acquisition of control over companies and business units, amounting to 20.7 million euros, as reported in Note 11 \u201cFinancial expenses\u201d, \u201cChanges in fair value\u201d include mainly: \u25aa the adjustment to fair value of the carrying amount of the put option recorded against the minority shareholder of EstEnergy Spa, which resulted in the recognition of income in the amount of 12.6 million euro, as reported in Note 19 \u201cFinancial liabilities\u201d; \u25aa the adjustment to fair value of the carrying amount of the earn-out recorded at the time of the acquisition of Pistoia Ambiente Srl, which resulted in the recognition of charges amounting to 5.7 million euro, as reported in Note 19 \u201cFinancial liabilities\u201d; \u25aa the adjustment made to the carrying value of a foreign currency bond due to the fair value hedge relationship that resulted in the recognition of charges amounting to 0.6 million euro, as reported in Note 29 \u201cDerivative Instruments\u201d. \u201cOther changes\u201d include effects mainly due to: \u25aa payment of dividends to minority shareholders with whom the Group contracted put options at the time of acquiring control, amounting to 21.9 million euro. In the cash flow statement, the related cash flow is represented in dividends paid out, although it is accounted for as a change in the financial liability already recorded (this mechanism is explained in Note 19 \u201cFinancial liabilities\u201d); \u25aa the recognition, in application of amortised cost, of the adjustment of the nominal value of the bond loan and loans taken out during the year totalling 10.2 million euro;
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 167|
\u25aa the recognition of liabilities related to leases entered into during the year and the remeasurement of
outstanding lease liabilities generated by an update of the underlying assumptions about renewal,
purchase, or early termination options, as reported in Note 22, \u201cRights of Use and Lease Liabilities\u201d.
Acquisition of Interests in consolidated companies
The value refers mainly to the outlay related to the purchase of non-controlling shares in Hera Comm
Marche Srl, as described in section 2.02.01 \u201cIntroduction\u201d.
Dividends paid out to Hera shareholders and non-controlling interests
The value refers to dividends paid out during the year 2022 to:
\u25aa Parent Company\u2019s shareholders in the amount of 176.7 million euro;
\u25aa minority shareholders in the amount of 42.8 million euro, of which 21.9 million euro were paid to
minority shareholders to whom the Group had recognized payables for put options in previous years,
as mentioned above.
Finally, it should be noted that non-monetary flows due to exchange rate differences were absent in
2022.
Investment activities
The Group\u2019s assets increased compared with the comparison year mainly due to new investments made
in public services under concession, particularly in the integrated water cycle and natural gas distribution
businesses.
Also note the recognition of customer lists amounting to 44.3 million euro and goodwill amounting to 5.2
million euro in connection with business combinations carried out during the year.
The following notes comment on the composition of and main changes within each asset category; note
that additional information about investments made during the period can be found in section 1.07
\u201cAnalysis by Strategic Business Area\u201d of the Directors\u2019 Report.
The value of all tangible and intangible assets, including goodwill, was subjected to impairment testing,
the results of which can be found in Note 25 \u201cImpairment tests on assets\u201d.
21 Tangible assets
31 Dec 22
31 Dec 21
Change
Land and buildings
620.4
585.3
35.1
Plants and machinery
1,089.5
1,107.8
(18.3)
Other movable assets
89.5
123.7
(34.2)
Assets under construction
183.0
122.1
60.9
Total operating assets
1,982.4
1,938.9
43.5
Investment property
2.0
2.1
(0.1)
Total
1,984.4
1,941.0
43.4
Property, plant and equipment are disclosed net of accumulated depreciation. Their composition and
changes in the period are as follows:
Net
opening
balance
Investments
Disinvest-
ments
Depreciation
and
amortisation
Changes in
the scope of
consol-
idation
Other
changes
Net
terminal
value
of which
gross
terminal
value
of which
amortis-
ation
provision
31 Dec 21
Land and buildings
573.2
13.2
(0.1)
(21.5)
9.6
10.9
585.3
856.8
(271.5)
Plants and machinery
1,120.1
58.0
(4.2)
(120.6)
3.3
51.2
1,107.8
3,005.5
(1,897.7)
Other movable assets
126.5
14.4
(0.8)
(28.8)
2.3
10.1
123.7
511.1
(387.4)
2.02.05
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 168| Assets under construction 104.4 86.3 (0.1) (2.0) \u2010 (66.5) 122.1 122.1 \u2010 Total 1,924.2 171.9 (5.2) (172.9) 15.2 5.7 1,938.9 4,495.5 (2,556.6) 31 Dec 22 Land and buildings 585.3 24.0 (1.9) (19.5) 3.7 28.8 620.4 908.7 (288.3) Plants and machinery 1,107.8 61.8 (3.7) (112.5) 9.0 27.1 1,089.5 3,060.2 (1,970.7) Other movable assets 123.7 13.7 (0.3) (21.0) 0.6 (27.2) 89.5 433.1 (343.6) Assets under construction 122.1 126.1 (0.5) \u2010 \u2010 (64.7) 183.0 183.0 \u2010 Total 1,938.9 225.6 (6.4) (153.0) 13.3 (36.0) 1,982.4 4,585.0 (2,602.6) For a better understanding of the changes that took place in the period, it should be noted that the assets used to carry out the urban sanitation service in the territorial basins of Bologna and the \u201cpianura e montagna modenese\u201d, totalling 53.1 million euro, have been reclassified under \u201cPublic services under concession\u201d among intangible assets, following the awarding of the tender for the period 2022-2036 in favour of the Temporary Grouping of companies (RTI) led by the Hera Group. Specifically, land and buildings amounting to 2.9 million euro, plants and machinery amounting to 15 million euro, other movable assets amounting to 22.7 million euro, and motor vehicles amounting to 12.5 million euro were reclassified under intangible assets. \u201cLand and buildings\u201d consists of 129.2 million euro in land and 491.2 million euro in buildings. These are mainly company-owned properties on which the majority of the sites and production plants stand. \u201cPlant and machinery\u201d is made up mainly of distribution networks and plants relating to business not falling within the scope of the concession system such as district heating, electricity in the Modena area, waste disposal and waste treatment as well as plastic production plants. The main investments for the year were in waste treatment activities amounting to 31.2 million euro and electricity distribution amounting to 10.7 million euro. At the same time, disinvestments took place for demolition as well as divestments of obsolete plants, which contributed to the reduction in depreciation compared with the previous year. \u201cOther movable assets\u201d, mainly includes the equipment, waste disposal bins in the amount of 56.5 million euro, and vehicles totalling 33 million euro. \u201cAssets under construction\u201d include mainly the investments being made in waste treatment plants amounting to 69.1 million euro and the electricity distribution network amounting to 12.5 million euro, as well as expansions and extraordinary maintenance of the Group\u2019s operating offices amounting to 17.1 million euro. \u201cOther changes\u201d covers the in-progress reclassification of fixed assets to the specific categories for assets brought into operation during the financial year, as well as the reclassification from tangible assets to intangible assets, especially when goods used in activities under concession are involved. During 2022 financial year, in addition to the above in relation to urban sanitation, there was also the redemption of assets previously held by the Group through leasing contracts and classified under Rights of Use, totalling 21.8 million euro, of which the largest part relates to the item \u201cLand and buildings\u201d. For the column \u201cChange in the scope of consolidation,\u201d please refer to the section \u201cBusiness combination (supplementary information)\u201d contained in Section 2.02.10 \u201cOther information.\u201d For additional details on guarantees granted in favour of third parties and in relation to tangible assets held by the Group, please refer to note 19 \u201cFinancial liabilities\u201d.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 169|
22 Rights of use and lease liabilities
The following tables show the breakdown of rights of use (reported net of the associated amortisation
provision) and lease liabilities at the transition date and the related movements. Contracts taken over as
part of business combinations are separately reported in movements and classified as \u201cChanges in the
scope of consolidation\u201d.
31 Dec 22
31 Dec 21
Change
Rights of use land and buildings
50.7
65.7
(15.0)
Rights of use plants and machinery
7.1
7.8
(0.7)
Rights of use other assets
26.4
28.1
(1.7)
Total
84.2
101.6
(17.4)
Net opening
balance
New
contracts
and
contractual
changes
Deprec-
iation and
amortis-
ation
Changes in
the scope of
consolid-
ation
Other
changes
Net terminal
value
of which
gross
terminal
value
of which
amortisat-
ion provision
31 Dec 21
Rights of use land and
buildings
68.7
5.1
(7.7)
0.8
(1.2)
65.7
110.4
(44.7)
Rights of use plants and
machinery
7.9
0.2
(1.2)
0.9
\u2010
7.8
12.0
(4.2)
Rights of use other assets
19.3
14.6
(8.1)
2.4
(0.1)
28.1
48.3
(20.2)
Total
95.9
19.9
(17.0)
4.1
(1.3)
101.6
170.7
(69.1)
31 Dec 22
Rights of use land and
buildings
65.7
12.5
(7.6)
0.4
(20.3)
50.7
94.1
(43.4)
Rights of use plants and
machinery
7.8
0.6
(1.2)
0.8
(0.9)
7.1
12.4
(5.3)
Rights of use other assets
28.1
8.2
(10.1)
0.8
(0.6)
26.4
49.4
(23.0)
Total
101.6
21.3
(18.9)
2.0
(21.8)
84.2
155.9
(71.7)
\u201cRights of use land and buildings\u201d consists of 44.9 million euro in rights of use related to buildings and
5.8 million euro in rights of use related to land. The rights of use for buildings refers mainly to contracts
concerning the real estate structures used for headquarters, offices and customer service desk.
\u201cRights of use of plant and machinery\u201d refers mainly to contracts regarding purification and composting
plants.
\u201cRights of use of other movable assets\u201d refers mainly to contracts underwritten for the use of IT
infrastructures (especially data centres), operational vehicles and cars.
The column \u201cNew contracts and contractual amendments\u201d shows the leases signed during the year, as
well as the change in the assumptions regarding the duration, renewal or termination options of the
existing contracts.
The column \u201cOther changes\u201d includes the residual value of leased assets redeemed during the period
and reclassified under tangible assets due to their nature. Specifically, it should be noted that, as
provided for in the contractual agreements between the parties, in the year 2022 the repossession of
buildings where some of the Group\u2019s main production facilities are located took place, buildings which
represented, at 31 December 2021, the contracts with the largest absolute value. The total amount
reclassified for the above transaction was 19.4 million euro.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 170|
Financial liabilities show the following composition and change, compared with the previous year:
Net opening
balance
New contracts
and
contractual
changes
Decreases
Financial
expenses
Changes in the
scope of
consolidation
Net terminal
value
31 Dec 21
Lease liabilities
93.6
19.9
(22.5)
3.2
2.5
96.6
of which
non-current liabilities
73.5
53.2
current liabilities
20.1
43.4
31 Dec 22
Lease liabilities
96.6
21.2
(46.0)
2.7
1.9
76.4
of which
non-current liabilities
53.2
55.1
current liabilities
43.4
21.3
Financial liabilities due to leases mainly include financial payables arising from the rental fees of the
Group\u2019s operating and administrative offices.
The column \u201cNew contracts and contractual changes\u201d includes the new contracts signed in the period
and the re-assessment of the debt of some of the existing contracts, generated by the update of the
assumptions underlying the contracts themselves concerning options of renewal, purchase or early
termination.
\u201cDecreases\u201d are generated by the reimbursement of contractual fees scheduled during the course of the
financial period and redemption options exercised. The value for the period includes, in particular, the
previously described repossession of buildings where major production facilities of the Group are located,
totalling 22.7 million euro.
In accordance with its procurement policies, the Group subscribed contracts in line with market standards
for all types of underlying assets. In the case of offices, customer service desks, cars and IT
infrastructure, the contracts do not contain any binding clauses or special fees in the event of annulment,
as these assets are perfectly interchangeable and are offered by a large number of counterparties. The
liability reported in the financial statements therefore represents the most likely total sum of
disbursements that the Group will have to make in future periods. For the same reasons, moreover, the
renewal clauses, when they exist, are not currently expected to be exercised, possibly assessing their
cost-effectiveness in the future or the option of signing new contracts with different counterparties.
The table below shows the lease liabilities broken down by category according to their expiration date
range:
Type
Total
Portion due within
the period
Portion due within
2nd year
Portion due within
5th year
Portion due beyond
5th year
2021 financial year
96.6
43.4
15.0
26.1
12.1
2022 financial year
76.4
21.3
17.4
25.1
12.6
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 171|
23 Intangible assets
31 Dec 22
31 Dec 21
Change
IT applications
82.5
84.6
(2.1)
Concessions and other rights of use
110.8
113.8
(3.0)
Public services under concession
3,184.5
2,963.4
221.1
Customer lists
581.1
576.2
4.9
Other intangible assets
92.9
79.4
13.5
Intangible assets under construction, public services under
concession
273.9
237.4
36.5
Intangible assets under construction
91.7
71.9
19.8
Total
4,417.4
4,126.7
290.7
Intangible assets are stated net of their accumulated amortisation and are broken down below with details
of the changes during the year:
Net
opening
balance
Invest-
ments
Disinvest-
ments
Depreciat-
ion and
amortis-
ation
Changes in
the scope
of consolid-
ation
Other
changes
Net
terminal
value
of which
gross
terminal
value
of which
amortisat-
ion
provision
31 Dec 21
IT applications
78.8
5.5
\u2010
(39.7)
0.2
39.8
84.6
524.5
(439.9)
Concessions and other
rights of use
130.2
0.3
\u2010
(16.8)
\u2010
0.1
113.8
471.6
(357.8)
Public services under
concession
2,860.1
181.1
(4.5)
(160.9)
4.7
82.9
2,963.4
5,144.1
(2,180.7)
Customer lists
546.3
\u2010
\u2010
(34.8)
64.7
\u2010
576.2
693.9
(117.7)
Other intangible assets
67.7
33.3
\u2010
(26.9)
0.2
5.1
79.4
225.8
(146.4)
Intangible assets under
construction, public
services under
concession
169.5
144.4
(0.8)
\u2010
\u2010
(75.7)
237.4
237.4
\u2010
Intangible assets under
construction
71.8
52.2
\u2010
(0.9)
\u2010
(51.2)
71.9
71.9
\u2010
Total
3,924.4
416.8
(5.3)
(280.0)
69.8
1.0
4,126.7
7,369.2
(3,242.5)
31 Dec 22
IT applications
84.6
4.5
\u2010
(42.9)
0.1
36.2
82.5
565.7
(483.2)
Concessions and other
rights of use
113.8
0.5
\u2010
(15.8)
12.0
0.3
110.8
483.8
(373.0)
Public services under
concession
2,963.4
208.3
(4.7)
(174.9)
\u2010
192.4
3,184.5
5,595.3
(2,410.8)
Customer lists
576.2
\u2010
\u2010
(39.4)
44.3
\u2010
581.1
741.8
(160.7)
Other intangible assets
79.4
43.4
0.0
(33.5)
0.1
3.5
92.9
269.7
(176.8)
Intangible assets under
construction, public
services under
concession
237.4
166.8
(0.4)
\u2010
\u2010
(129.9)
273.9
273.9
\u2010
Intangible assets under
construction
71.9
60.4
\u2010
(0.3)
\u2010
(40.3)
91.7
91.7
\u2010
Total
4,126.7
483.9
(5.1)
(306.8)
56.5
62.2
4,417.4
8,021.9
(3,604.5)
\u201cIT applications\u201d refers to costs incurred in purchasing licenses and implementing corporate information
systems.
\u201cConcessions and other rights of use\u201d mainly includes:
\u25aa concessions, for 37.8 million euro, primarily involving the rights relating to the activities of gas
distribution and integrated water cycle, classified as intangible assets even before the IFRIC 12
interpretation \u201cService concession arrangements\u201d was first applied;
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 172|
\u25aa the authorisation to operate the Serravalle Pistoiese landfill, for 53.4 million euro, an asset recorded
as part of the a business combination operation carried out in previous periods and amortised on the
basis of the number of tons consigned.
\u201cPublic services under concession\u201d includes assets relating to gas distribution, electricity distribution
(Imola area), the integrated water cycle and public lighting activities (except for the latter, as specified in
note 18 \u201cCurrent financial assets, cash and cash equivalents\u201d) provided through contracts awarded by
the respective public bodies. These concession relationships and associated assets involved in carrying
out the activities for which the Group holds the use rights, are accounted for by applying the intangible
asset model as set forth by IFRIC 12 interpretation. Investments for the year related mainly to the water
networks, in the amount of 118.7 million euro, and gas distribution networks, in the amount of 51.5 million
euro. It should be noted that, during the year, the item was changed by the reclassification of the assets
related to the urban sanitation service in the areas of Bologna and Modena, which were previously
classified as tangible assets due to the different regulatory framework, following the awarding of the
tender for the area, as reported in detail in Note 21 \u201cTangible assets\u201d. Depreciation and amortization for
the period, up sharply from last year, is therefore also affected by the above reclassification.
\u201cIntangible assets under construction and public services under concession\u201d includes investments
related to these concessions that are still to be completed at the end of the period and mainly refers to
the water networks, in the amount of 89.8 million euro, and gas distribution networks, in the amount of
34.3 million euro.
\u201cIntangible assets under construction\u201d essentially comprises IT projects that have not yet been
completed.
\u201cCustomer lists\u201d are recorded as a result of business combination transactions and the consequent
valuation of the assets acquired. The amortisation period of these customer lists is correlated to the churn
rate identified for each individual transaction. Depreciation and amortisation for the period increased
compared with the comparison period due to the recognition of customer lists as a result of the control
acquisitions in the second half of the 2021 financial year and during the 2022 financial year.
The item \u201cOther intangible assets\u201d refers mainly to the rights of use for networks and infrastructures for
the passage and laying down of telecommunication networks and the incremental costs incurred for
obtaining new sale contracts. In particular, the commissions recognized as assets for the 2022 fiscal
year amounted to 36 million euro (24.8 million euro for 2021), and the significant increase in amortisation
for the period is due to them.
\u201cOther changes\u201d include reclassifications of fixed assets under construction to their specific categories
in the case of assets that came into operation during the year and reclassifications from/to tangible
assets, especially in the case of assets subject to concession activities, as mentioned under \u201cPublic
services under concession\u201d.
\u201cChange in scope of consolidation\u201d reflects the control acquisitions made during the year, for details of
which please refer to the section \u201cBusiness combination (supplementary information)\u201d contained in
Section 2.02.10 \u201cOther information\u201d.
24 Goodwill
31 Dec 22
31 Dec 21
Change
Goodwill
848.1
842.9
5.2
The value of goodwill at 31 December 2022 mainly reflects the following operations:
\u25aa Acquisition of control of the \u201cAscopiave business activities,\u201d i.e. the companies EstEnergy Spa,
Ascotrade Spa, Ascopiave Energie Spa, Blue Meta Spa, Etra Energia Srl and Amgas Blu Srl, which
took place in 2019 for a total of 431.2 million euro;
\u25aa integration that in 2002 resulted in the creation of Hera Spa, totalling 81.3 million euro;
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 173|
\u25aa acquisition of control through the merger of Agea Spa, taking place in January 2004, amounting to
41.7 million euro:
\u25aa acquisition of control over Gruppo Meta which took place during the 2005 financial year, as a result
of the merger of Meta Spa into Hera Spa, totalling 117.7 million euro;
\u25aa acquisition of control over Sat Spa through the merger into Hera Spa, taking place during 2008,
amounting to 54.9 million euro:
\u25aa acquisition of control over the Aliplast Group taking place in 2017, totalling 25 million euro;
\u25aa acquisition of control over the Marche Multiservizi Group, amounting to 20.8 million euro.
As reported in Section \u201cBusiness Combinations (supplementary information)\u201d of section 2.02.10 of \u201cOther
information\u201d, during the 2022 fiscal year business combinations took place resulting in an increase in
goodwill.
Below is the value of goodwill broken down by operating segment:
31 Dec 22
31 Dec 21
Change
Gas
493.5
494.8
(1.3)
Waste management
233.5
228.3
5.2
Electricity
73.5
72.2
1.3
Water cycle
42.7
42.7
\u2010
Other services
4.9
4.9
\u2010
Total
848.1
842.9
5.2
25 Impairment tests on assets
Cash-generating and goodwill units
Assets and goodwill have been subjected to impairment tests by determining the value in use, which is
the current value of operating cash flows (duly discounted according to the dcf - discounted cash flow
method) resulting from the 2022 - 2026 business plan approved by the Board of Directors of the parent
company at its meeting 8 February 2023.
The impairment test was applied to the following CGUs (Cash generating units): gas, electricity,
integrated water management, environmental and other services (Public lighting and
telecommunications) that are consistent with the business areas used for internal periodic reporting and
with the information contained in the annual financial report in paragraph 2.02.10 \u201cOther Information\u201d.
In relation to this, it should be noted that the Group has implemented a structured process for preparing
and reviewing the business plan, which involves formulating the Plan on an annual basis according to
an external context scenario that takes into account the market trends and rules for regulated businesses,
with the support of all the business units and following a bottom-up logic. Specifically, assumptions were
implemented in developing the 2022-2026 Business Plan consistent with those used in previous plans
and, on the basis of the final reported values, forecasts were developed that refer to the most
authoritative and up external sources available wherever necessary.
Revenues for regulated business areas were developed on the basis of the evolution of the rates deriving
from national regulations and/or agreements with the Area Authority. In particular, revenues from energy
distribution were forecasted according to the principles of ARERA 737/22 (RTDG) and 568/19 (TIT)
resolutions for gas and electricity respectively, and taking into account the respective WACC values set
by ARERA. These rates were approved until the year 2023 in the integrated reference text (TIWACC
2022-2027, Resolution 614/21 as amended), while for subsequent years they were updated in
accordance with the methodology of the same resolution and according to the forecasted financial and
fiscal parameters integrated into the approved business plan.
Revenues from energy sales under protected conditions and with regard to services of last resort have
instead been estimated on the basis of the respective regulatory reference texts, i.e. the TIV (resolutions
208/2022 and 491/2020/R/EEL) for electricity and TIVG (approved by resolution ARG/GAS/64/09, as
amended) for gas.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 174|
For integrated water management, the hypothesis used to forecast revenues assumed no change in the
volumes distributed and was based on the rates originating from the agreements in effect with ATERSIR
and the application of the Water Rate method (MTI-3) set forth by ARERA resolution no. 639/21, also
taking account the parameters underlying the hedging of financial and tax charges, among other factors.
For urban sanitation, the hypothesis formalized involved achieving full rate coverage over all the areas
served within the duration of the plan, consistent with the provisions of rules currently in effect.
Price trends for electric energy and gas bought and sold in the open market were worked out on the
basis of business considerations consistent with the planned energy scenario, considering the forecasts
provided by a panel of institutional observers.
The development of plants for the treatment and recycling of waste is consistent with the forecasts of the
provincial plans for the provinces in which the Hera Group operates. The investment schedule and the
subsequent start of new plants is the result of the best estimate of the managers in charge.
The inertial evolution of the Group\u2019s costs in the plan timeframe was developed by formulating
hypotheses based on the information available. In relation to employees and labour costs, instead, the
indications included in the various types of employment contracts were considered.
The first year of the plan represents the base reference for identifying economic, financial and
management objectives that converge in the annual budget, the guiding operational element for
achieving the Group\u2019s growth objectives.
The cash flows generated were therefore determined using the data for the 2023 - 2026 period as a
base. In particular, the net profit margin was used, from which taxes were deducted, depreciation and
provision were added and the maintenance investments planned for each year of the plan were
deducted.
Following the last year of the plan, Free cash flows were considered equal to the value of the Net
operating profit for the last year of the plan, in the event that the value of depreciation and provisions
remains at the level of the investments. In the event that the plan does not take into account the prediction
of future events that significantly influence estimated cash flows as a result of its medium-term timeframe,
adjustments were applied in order to also incorporate the effects of such events. The cash flows are
calculated by applying the growth rate (g) to the normalised Free Cash Flows with the medium/long-term
timeframe for the relevant sector (2% on average) for the 2027-2042 period (20 years total). For regulated
services, these flows are brought into line with the expected continuation of market share following the
completion of the expected calls for tenders.
These flows are supplemented by the current value of perpetuity, calculated as follows:
\u25aa For market activities, the cash flow resulting from the application of the perpetuity criterion for the last
year (2042) was considered, assuming an average factor growth of 2%;
\u25aa for services under contract, the terminal value was established by considering the cash flow resulting
from the application of the perpetuity criterion weighted by the percentage of competitive bidding
processes that the Group is expected to win at the end of the contract periods (100% for network
services, 80% for urban sanitation services) and the redemption value of assets weighted by the
proportion of competitive bidding processes which the Group expected not to win. This value was
estimated as equal to the current value of the net book value of assets owned and leasehold
improvements, less the recovery values, in order to properly represent the non-renewal of the
contract and the subsequent sale of the assets to the new operator with a value equal to the remaining
book value.
To discount unlevered cash flows, the rate used was the weighted average cost of capital (WACC), which
represents the yield expected by the funders and shareholders of the company for the use of equity
capital, adjusted for the risk of the specific country in which the asset being valued. The value of the
specific country risk to be included in the discount rate is defined on the basis of information provided by
external providers. Since the Group has a diversified business portfolio with a balance of regulated and
free-market activities that make it less exposed to cyclical trends in the economy, it was decided to
maintain the historical methodological approach which involves a 9 /12-month observation of the
variables underlying the Wacc calculation. At the same time, in order to formulate a view of the effects
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 175|
of a possible medium- to long-term financial shock, a \"Stressed\" scenario was developed that would take
into account current market conditions albeit in a particularly volatile environment.
Specifically, the rates used for the purposes of the actual and scenario assessments are as follows:
2022
Base
2022
Stressed
2021
Base
Wacc Gas \u2013 Electricty \u2013 Water Cycle \u2013 Other Services
4.58%
5.80%
4.27%
Wacc waste management
5.36%
6.35%
5.15%
The outcomes of the test were positive for all Cgu, showing a use value higher than the book value.
In view of this, two sensitivity scenarios were hypothesised:
\u25aa an initial analysis focused on the marginality of the individual businesses, hypothesizing a 5%
decrease that would result in a reduction in the cash flows developed in the years covered by the
plan and subsequent years.
\u25aa the second analysis, hypothesising discounting all cash flows, used the \"Stressed\" Wacc.
In both of these scenarios, the values obtained are higher than those recorded in the balance sheets,
therefore this analysis has further confirmed the carrying values.
Assessments concerning climate change scenarios and consequent sensitivity
Th electrification of energy consumption is one of the most significant risks/opportunities related to
climate change. Achieving climate change mitigation, as defined through emission reduction targets at
the European level and translated on a national basis with related implementation plans, requires
initiatives to change both the technologies adopted to meet energy needs and measures to make them
more efficient.
The Hera Group has therefore begun conducting specific analyses aimed at identifying the possible
impacts of the scenario of transition on the evolution of end customers\u2019 energy consumption, with
reference to the business areas it has selected within a timeframe that extends up to 2040.
The analyses took into account exogenous drivers, such as national and European policies on the topic
and consumer preferences, drivers of change, and related enabling technologies. The results have
allowed the company to gauge the impact that the transitional scenario could have on the evolution of
gas and electricity consumption as a function of key determinants such as energy efficiency, technology
mix, mobility, and self-consumption. These analyses confirmed, in particular, the widespread expectation
that the future will witness a growth in electricity consumption and a simultaneous reduction in gas
consumption.
With reference to the businesses operated by the Group, the assessments conducted necessarily took
into account the differing nature of the regulated distribution business and the free-market sales
business.
Regarding the gas distribution business, it should first be mentioned that ordinary and extraordinary
maintenance activities, for which tariff remuneration is provided, are correlated to the physicality of the
assets and not to the volumes of gas distributed. Indeed, renovation work is mainly carried out to resolve
critical issues through event-driven interventions, resulting, for example, from a network or plant leakage
or breakdown, or through scheduled operations to comply with the dictates of technical and regulatory
standards.
The transitional risk related to climate change thus appears to depend on purely regulatory decisions
and future systemic developments in the gas distribution network. One prospect considered likely by the
Group is that the drivers generating gas network development needs might change from the need to
meet consumption demands to the need to meet input requirements for biomethane and green gas in
general that can enable the running of energy production systems using renewable sources.
In this respect, ARERA has also shown interest in exploring issues related to possible transition costs
that may emerge when there is a decline in consumption and thus a decline in the use of this energy
vector. The 2022-25 Strategic Framework reveals an awareness of the need to reflect on which market
and regulatory tools might be the most suitable to facilitate the carrying out of investments that are of
real benefit to the system, in compliance with efficiency and economic sustainability criteria.
At present, however, the Regulatory Authority has not issued any measures, deeming that it is
proceeding in full accordance with the current regulatory criteria. Therefore, on the basis of these
considerations, the Group does not judge that any elements can be identified in the current framework
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 176| to assume that the system will be severely disrupted without mechanisms in place to protect the financial equilibrium of companies providing gas distribution services. Electricity distribution, on the other hand, is set to have an ever increasing impact on the energy grid due to the electrification of consumption. This may in effect represent a development opportunity for the Group, especially when the current concessions are put up for tender. Relative to sales activity, a model scenario extending beyond the horizon of the plan was formulated that, taking into account transitional risks, projects customer consumption by service and type of use through to 2040. In particular, by considering the various effects of energy efficiency and transition dynamics, average volumes by customer cluster were calculated and growth/decrease rates over time were applied to these calculated volumes. To provide an estimate of overall marginality, intermediate steps were taken, estimating the evolution of the customer base in terms of supply points, to which an average volume per segment was attributed, adjusted over time to consider the impact of energy transition. Assuming that the margins hypothesized in the business plan for each service/segment remain constant over time, a significant growth in electricity margins was estimated for the period 2027-2040, associated with a lesser reduction in gas margins. In order to conduct a sensitivity analysis in relation to the impairment test, projections for natural gas sales were incorporated into the valuation models, both adjusting the annual cash flows up to 2040 (based on the assumptions made previously) by an average of 8 million euro and normalizing the cash flow used to calculate the terminal value by an analogous amount. In this hypothetical scenario as well, the results confirm the full recoverability of the asset values recorded in the balance sheet. An additional physical risk that may impact the Group is increased temperatures. Therefore, an additional medium- to long-term Cgu gas stress scenario was developed that would take into account the effects of an increase in average winter temperatures. Specifically, the projected increase in the RCP8.5 scenario is 1.5\u00b0C up to 2030 2\u00b0C up to 2050, relative to the 1981-2010 average. In relation to the climate assumptions for estimating gas sales volumes for the purposes of the Business Plan, this results in an 0.7\u00b0C increase up to 2030 and an 1.2\u00b0C increase up to 2050, respectively. Based on this scenario, again with a planning horizon up to 2040, a sensitivity analysis was developed to take into account a consequent reduction in Cgu gas margins ( please also refer to the section of the Directors' Report 1.02.03 \"Environmental-Catastrophic Risk Management\"). In this case, too, the results obtained confirm the full recoverability of the values of the assets recorded in the financial statements Shareholdings During the fiscal year 2022, there were no significant transactions involving the purchase or sale of shareholdings. The only investment that resulted in a change in the portfolio was the acquisition of non- controlling shares in Aurora Srl, a company in the waste treatment sector that is currently not operational. The changes in value from the previous year are therefore attributable to the assessment processes of investee companies. 26 Shareholdings 31 Dec 22 31 Dec 21 Change Shareholdings valued using the equity method 151.4 150.6 0.8 Other shareholdings 38.9 47.9 (9.0) Total 190.3 198.5 (8.2) The changes in joint ventures and associated companies as compared to 31 December 2021 take into account the pro-quota losses and profits reported by the respective companies (including the other components of the comprehensive income statement) as well as the possible reduction of the value for any dividends that were distributed and for depreciations due to the impairment test. 2.02.06 | Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 177| Changes in consolidated shareholdings using the net equity method are as follows: Opening value Investments and disinvestments Profit for the fin. year Dividends paid out Changes in the scope of consolidation Write-downs and other changes Terminal value 31 Dec 21 Enomondo Srl 15.6 \u2010 3.1 (1.1) \u2010 \u2010 17.6 Total joint ventures 15.6 \u2010 3.1 (1.1) \u2010 \u2010 17.6 Aimag Spa 50.6 \u2010 3.7 (2.6) \u2010 \u2010 51.7 Set Spa 27.9 \u2010 0.6 \u2010 \u2010 \u2010 28.5 Sgr Servizi Spa 24.4 \u2010 3.0 (2.2) \u2010 \u2010 25.2 ASM SET Srl 18.7 \u2010 1.4 (1.2) \u2010 \u2010 18.9 SEA - Servizi Ecologici Ambientali Srl \u2010 \u2010 1.4 (2.4) 9.7 \u2010 8.7 Total associated companies 121.6 \u2010 10.1 (8.4) 9.7 \u2010 133.0 Total 137.2 \u2010 13.2 (9.5) 9.7 \u2010 150.6 31 Dec 22 Enomondo Srl 17.6 \u2010 3.1 (2.2) \u2010 0.3 18.8 Total joint ventures 17.6 \u2010 3.1 (2.2) \u2010 0.3 18.8 Aimag Spa 51.7 \u2010 2.3 (2.8) \u2010 \u2010 51.2 Set Spa 28.5 \u2010 (0.6) \u2010 \u2010 \u2010 27.9 Sgr Servizi Spa 25.2 \u2010 2.4 (2.0) \u2010 (0.1) 25.5 ASM SET Srl 18.9 \u2010 1.5 (1.4) \u2010 (0.1) 18.9 SEA - Servizi Ecologici Ambientali Srl 8.7 \u2010 1.3 (1.0) \u2010 0.1 9.1 Total associated companies 133.0 \u2010 6.9 (7.2) \u2010 (0.1) 132.6 Total 150.6 \u2010 10.0 (9.4) \u2010 0.2 151.4 The result for the year decreased from the previous year mainly due to the lower results reported by Aimag Spa, a multi-utility company operating in the province of Modena area, and Set Spa, an investment vehicle for a combined-cycle power plant located in Teverola (CE). On the other hand, the results of the company Enomondo Srl, operating in the production of thermal energy and electricity from biomass combustion plants, remained constant. No impairments or reversals of impairments were reported for companies within the scope of consolidation. For more details on the assumptions and results of the impairment tests to which the carrying values of the investments in affiliates that represent vehicles through which the Group holds shares in the production of electric generation plants (Set Spa and Tamarete Energia Srl) were subjected, please see the information in Note 27 \u201cImpairment tests on shareholdings\u201d below. Associated companies and joint ventures
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 178|
Investments in companies not included in the scope of consolidation underwent the following changes:
Fair value
hierarchy
Opening
value
Investments and
disinvestments
Fair value
valuations
Other changes
Terminal value
31 Dec 21
Ascopiave Spa
1
42.0
\u2010
(2.1)
\u2010
39.9
Veneta Sanitaria Finanza di
Progetto Spa
3
3.6
\u2010
\u2010
\u2010
3.6
Other minor companies
3
5.1
1.3
(2.0)
\u2010
4.4
Total
50.7
1.3
(4.1)
\u2010
47.9
31 Dec 22
Ascopiave Spa
1
39.9
\u2010
(12.3)
\u2010
27.6
Veneta Sanitaria Finanza di
Progetto Spa
3
3.6
\u2010
\u2010
\u2010
3.6
Other minor companies
3
4.4
3.2
\u2010
0.1
7.7
Total
47.9
3.2
(12.3)
0.1
38.9
In the case of shareholdings with a fair value hierarchy of 1, the value adjustment, recorded in the
components of the comprehensive income statement, makes it possible to align the book value of the
shares with the market prices at the end of the year. In the case of hierarchy 3 shareholdings, partly in
view of the insignificant value of the investments in the portfolio, the change in fair value was not
significant.
Investments for the period are mainly attributable to the purchase of minority shares in Aurora Srl, as
specified above.
Other
share-
holdings
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 179| Below are presented the main aggregate values of the joint venture Enomondo Srl as well as companies with significant influence (Aimag Spa, ASM SET Srl, SEA Srl, Set Spa, Sgr Servizi Spa and Tamarete Energia Srl): Assets Company Joint ventures Company Associated companies Total Non-current assets Tangible assets 34.3 410.6 444.9 Rights of use 0.6 0.6 Intangible assets 53.4 53.4 Goodwill 105.0 105.0 Shareholdings 7.0 7.0 Financial assets 0.5 12.9 13.4 Deferred tax assets 0.7 4.5 5.2 Total non-current assets 35.5 594.0 629.5 Current assets Inventories 0.5 23.3 23.8 Trade receivables 7.3 337.6 344.9 Contract work in progress 3.0 3.0 Financial assets 9.1 9.1 Current tax assets 3.5 3.5 Other current assets 6.5 99.8 106.3 Derivative instruments 0.6 0.6 Cash and cash equivalents 8.0 29.3 37.3 Total current assets 22.9 505.6 528.5 Total assets 58.4 1,099.6 1,158.0 Investee data | Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 180| Net equity and liabilities Company Joint ventures Company Associated companies Total Share capital and reserves Share capital 14.0 88.0 102.0 Reserves 17.4 281.8 299.2 Profit (loss) for the period 6.1 26.6 32.7 Group net equity 37.5 396.4 433.9 Non-controlling interests 14.3 14.3 Total net equity 37.5 410.7 448.2 Non-current liabilities Non-current financial liabilities 7.2 213.5 220.7 Non-current lease liabilities 0.4 0.4 Post-employment and other benefits 5.6 5.6 Provisions for risks and charges 1.0 37.8 38.8 Deferred tax liabilities 0.1 0.7 0.8 Derivative financial instruments 0.1 0.1 Total non-current liabilities 8.3 258.1 266.4 Current liabilities Current financial liabilities 3.0 145.8 148.8 Current lease liabilities 0.1 0.1 Trade payables 8.6 255.2 263.8 Current tax liabilities 0.3 0.3 Other current liabilities 1.0 29.4 30.4 Total current liabilities 12.6 430.8 443.4 Total liabilities 20.9 688.9 709.8 Total net equity and total liabilities 58.4 1,099.6 1,158.0 Income statement Company Joint ventures Company Associated companies Total Revenues 28.8 1,265.9 1,294.7 Other operating revenues 3.5 2.5 6.0 Raw materials and materials (2.5) (1,015.1) (1,017.6) Service costs (15.8) (100.0) (115.8) Personnel costs (0.4) (29.3) (29.7) Amortisation, provisions and depreciation (5.4) (55.9) (61.3) Other operating costs (0.1) (22.2) (22.3) Operating revenues 8.1 45.9 54.0 Financial income 5.0 5.0 Financial expenses (0.2) (9.5) (9.7) Total financial management (0.2) (4.5) (4.7) Other non-operating revenues (expenses) (1.3) (1.3) Earnings before taxes 7.9 40.1 48.0 Taxes for the period (1.8) (12.3) (14.1) Net revenues for the period 6.1 27.8 33.9
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 181|
27 Impairment tests on shareholdings
With reference to the market for electric generation, in the presence of impairment indicators and in
keeping with previous financial periods, an in-depth analysis was performed to determine the recoverable
amount of the Group\u2019s investments, and related financial assets, operating in the sector. In particular,
the analysis was conducted by discounting the value of the cash flows expected to be generated over
the remaining useful lives of the plants of Set Spa and Tamarete Energia Srl
In the 2022 financial year, as a result of the significant increase in gas prices, there was a significant
effect on prices in Mgp and the presence of a negative baseload Clean spark spread (Css). Emerging
trend signals show short-term opportunities offered by moderately positive baseload Css values, while
in the medium to long term the outlook is leaning toward a consolidation towards slightly negative values,
against, however, positive modulated Css. The factors that have determined the performance of the
electricity generation market during this decade are due to the combination of multiple factors on both
demand and supply sides. The main factors affecting current price dynamics are to be found in:
\u25aa introduction of significant production capacity in renewable energy in the past few years;
\u25aa moderate GDP growth and consumption efficiency (driven by European and national environmental
policy objectives) reflected in the low growth in demand for energy;
\u25aa European and national policies in relation to CO2 emission reduction targets and targets for
renewable energy affecting supply.
On the basis of new scenarios developed, it is believed that the market will evolve towards levels of
baseload Clean spark spread aligned in the short term to the recent historical level, while they will be
slightly negative in the medium to long term, in particular due to a combination of multiple effects,
including:
\u25aa new high-efficiency incoming capacity (CCGT) beginning in 2022, which will replace coal-powered
plants with a view to phasing out coal by 2025;
\u25aa beginning of the end-of-life cycle of the old CCGT plants, which, from the second half of the decade,
creates favourable market conditions for highly efficient and flexible retrofits of the old CCGT plants,
whose remuneration and return on investment are ensured by the participation in MGP and MSD,
additionally ensuring a higher level of suitability of the system in the medium-long term and therefore
less room for marginality growth in the absence of such investments;
\u25aa resulting unincreased marginality in the MGP market;
\u25aa growing role of renewable sources, also supported by the need to reduce dependency not only on
fossil fuels in general but also on specific geopolitical areas.
That said, future cash flows determined on the basis of the medium/long-term energy scenario the Group
considered to be the most likely, formulated on the basis of independent expert assumptions consistent
with growth expectations for energy demand, installed power, the demand for combined cycle and the
system\u2019s expected reserve margin. This scenario alters the one used in the previous exercise, affecting
future Clean spark spread values. The estimated cash flows were discounted using a 5.21% WACC,
calculated in the same way as shown for the cash flow generating units, as indicated in note 25
\u201cImpairment tests on assets\u201d.
Specifically, the rates used for the purposes of the actual and scenario assessments are as follows:
2022
Base
2022
Stressed
2021
Base
Electricity generation WACC
5.21%
6.18%
5.04%
The outcome of the test confirmed the full recoverability of the values relating to Set Spa, while it
confirmed a highly critical scenario for Tamarete Energia Srl, as it found there are not the prerequisites
for recovering the sums invested.
In addition, two sensitivity scenarios were hypothesised:
\u25aa an initial analysis was developed by decreasing the Css by 1 euro/MWh, resulting in reduced cash
flows developed over the life years of the plants;
\u25aa a second analysis, hypothesising the discounting of all cash flows used the \"Stressed\" WACC.
Under both scenarios, this would result in the full recoverability of Set Spa's book values.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 182|
At the end of the valuation process, the carrying amount of financial assets, shareholdings and
receivables attributable to Set Spa was 43.3 million euro, while the financial assets attributable to
Tamarete Energia Srl were written down in full. The Group has estimated the possible financial
undertaking necessary to guarantee the business continuity of Tamarete Energia Srl should the future
negative scenario be confirmed as amounting to approximately 2.9 million euro, recording a liability of
the same amount as an implicit obligation.
28 Cash flows related to investment activities
Investments in subsidiary companies and business units net of cash holdings
For more details on the acquisition transactions carried out during the 2022 financial year, please refer
to Section 1.03 \u201cSignificant Events\u201d of the Directors\u2019 Report under section \u201cBusiness Combinations
(supplementary information)\u201d and Section 2.02.10 \u201cOther Information\u201d of the Notes to the Financial
Statements.
Other equity investments
During the 2022 fiscal year, the Group acquired non-controlling shares of Aurora Srl, which operates in
the waste treatment sector. This company, not equipped with significant assets, is not yet operational
and has thus been excluded from the scope of consolidation and recorded under investments in other
shareholdings.
The table below details the main cash disbursements and cash holdings acquired, when present,
associated with shareholdings in companies and business units.
31 Dec 22
Alibardi
Fiorenzo Srl
Con Energia
Spa
Macero
Maceratese Srl
\u201cBfeng\u201d business
unit
Other minor
companies
Total
investments
Cash outlays leading to the
acquisition of control
1.4
30.0
10.0
12.0
53.4
Considerations to pay out
1.1
1.1
Cash holdings acquired
(4.2)
(0.2)
(4.4)
Investments in subsidiary
companies and business units
net of cash holdings
1.4
25.8
10.9
12.0
50.1
Cash outlays in non-consolidated
companies
3.2
3.2
Investments in subsidiary
companies, business units and
other shareholdings
1.4
25.8
10.9
12.0
3.2
53.3
Increase/decrease in other investment activities
The following is a breakdown of information on changes in the other investment activities during the 2022
financial year, differentiating between cash flows and non-cash flows.
Type
Non-cash flows
31 Dec 22
31 Dec 21
Change
(a)
Acquisitions
divestitures
(b)
Economic
valuation
components
(c)
Changes in fair
value
(d)
Other
changes
(e)
Cash flows
(f)=[(b)+(c)+(
d)+(e)]-(a)
Current and non-
current financial
assets
229.5
172.0
57.5
2.3
6.8
49.5
1.1
\u201cAcquisitions and Divestitures\u201d include the effects arising from the control acquisition transactions carried
out in the 2022 financial year, as explained in the section \u201cBusiness Combinations (supplementary
information)\u201d of section 2.02.10 \u201cOther information\u201d.
\u201cEconomic valuation components\u201d mainly include income from discounting non-current financial
receivables (amounting to 4.7 million at 31 December 2022), as reported in Note 10 \u201cFinancial income\u201d.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 183|
\u201cOther changes\u201d mainly includes the amount of tax credit assignments realized at the end of the 2022
fiscal year with leading financial institutions, the collection of which took place in January 2023 in the
amount of 46.3 million. For further details, please see note 18 \u201cFinancial assets, cash holdings and cash
equivalents\u201d.
Derivatives and related instruments
The derivative instruments used by the Group are divided into two types based on the underlying assets
hedged: interest and exchange rates with reference to financing transactions, and commodities with
reference to the commercial purchase and sale of gas and electricity. All commodity derivatives are
classified as current assets and liabilities by virtue of the high level of liquidity and the operational time
span that characterise these instruments.
29 Derivative instruments
At 31 December 2022, the net exposure of interest and foreign exchange derivatives was negative, albeit
slightly up from the previous year.
In contrast, the net exposure of commodity derivatives, which is significantly higher than last year, reflects
the increase in energy commodity prices.
31 Dec 22
31 Dec 21
Change
Fair value
assets
Fair value
liabilities
Net effect
Fair value
assets
Fair value
liabilities
Net effect
Net effect
Interest/exchange rate
derivatives
Loans
0.5
\u2010
0.5
\u2010
0.1
(0.1)
0.6
Foreign currency loans
0.5
6.3
(5.8)
6.9
13.4
(6.5)
0.6
Total interest/exchange
rate derivatives
1.0
6.3
(5.4)
6.9
13.5
(6.6)
1.3
Commodity derivatives
\u2010
\u2010
\u2010
Commercial portfolio
1,531.0
1,244.3
286.8
1,716.1
1,616.6
99.5
187.4
Trading portfolio
91.2
103.4
(12.2)
81.3
86.6
(5.3)
(6.8)
Total commodity
derivatives
1,622.2
1,347.6
274.6
1,797.4
1,703.3
94.1
180.5
Total derivatives
1,623.2
1,353.9
269.2
1,804.3
1,716.8
87.5
181.7
of which non current
1.0
6.3
6.9
13.5
of which current
1,622.2
1,347.6
1,797.4
1,703.3
The financial management policy envisages the use of hedging instruments to effectively offset changes
in the fair value, cash flows of the hedged instrument or, more specifically, changes in interest and
exchange rate fluctuations that affect the sources of funds used. At 31 December 2022, the net exposure
in terms of fair value with regard to current and non-current interest and foreign exchange derivatives in
the form of interest rate swaps (IRSs) and cross currency swaps (CCSs) is negative compared to the
previous year and is due to the increase in interest rate curves, the strengthening of the euro over the
yen, and the realisation of cash flows.
The operational management of commodities, on the other hand, is carried out through a process that
identifies objectives, strategies and responsibilities for each existing operation. Contracts, both financial
and physical in nature, are classified into the commercial or trading portfolios according to the purpose
of the contracts. The Group\u2019s internal organisational model make it possible to identify the nature of the
operation (commercial or trading) and produce the information required for a formal identification of the
purpose of derivatives. The centralised management of hedging transactions allows for all possible
synergies for hedging the electricity consumption needs of the Central Market Department, and is
integrated with exchange rate transactions towards the market and is carried out through the exclusive
use of swap contracts or other authorised derivatives.
2.02.07
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 184| All other derivatives or similar instruments that are not intended to hedge the Group\u2019s requirements are classified in the trading portfolio. In the 2022 fiscal year, commodity derivatives showed a significantly higher net positive exposure than in the previous year, largely related to the significant increase in energy commodity prices, which were also reflected in higher commodity costs (gas and electricity). Interest rate derivatives Interest rate and foreign exchange derivative instruments held as of 31 December 2022, subscribed in order to hedge loans, can be classed into the following categories: 31 Dec 22 31 Dec 21 Type Fair value hierarchy Notional Fair value assets Fair value liabilities Notional Fair value assets Fair value liabilities Cash flow hedges 2 8.3 mn 0.5 \u2010 9 mn \u2010 0.1 Fair value hedges 2 149.8 mn 0.5 6.3 149.8 mn 6.9 13.4 Non-hedge accounting 2 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 Total fair value 1.0 6.3 6.9 13.5 31 Dec 22 31 Dec 21 Type Fair value hierarchy Income Financial Expenses Net effect . Income Financial Expenses Net effect . Cash flow hedges 2 0.1 \u2010 0.1 0.0 \u2010 0.0 Fair value hedges 2 18.2 (21.4) (3.3) 11.0 (15.8) (4.8) Non-hedge accounting 2 \u2010 \u2010 \u2010 18.3 (18.3) (0.0) Total income (expenses) 18.3 (21.4) (3.2) 29.3 (34.1) (4.8) The positive change in the fair value of derivatives classified as cash flow hedges is mainly due to the realisation of cash flows during the period, that is, the reduction in the notional amount of the derivative. No significant ineffective portions connected to the residual financial instruments were found in the financial period. The overall effect of these instruments on the statement of comprehensive income was equal to 0.5 million euro in 2022. Derivatives designated as hedges of interest rate and exchange rate risks and of the fair value of foreign currency financial liabilities (fair value hedges), in the form of interest rate swaps (IRS) and cross currency swaps (CCS), are related to a bond denominated in Japanese yen with a remaining notional amount of 20 billion yen equal to 149.8 million euro (converted at the original exchange rate being hedged). The change in fair value is attributable to the exchange rate effect, the Japanese yen having depreciated against the euro in 2022, as well as the rise in interest rate curves. The table below provides a breakdown of financial income and expense associated with derivatives designated as fair value hedges and related underlying liabilities, as adjusted for the income and losses attributable to the hedged risk: Fair value hedges 31 Dec 22 31 Dec 21 Income Financial Expenses Net effect . Income Financial Expenses Net effect . Assessment of derivatives 13.2 (12.6) 0.6 6.4 (7.6) (1.2) Accrued interest 0.5 (0.6) (0.1) \u2010 (0.1) (0.1) Realised cash flows 4.4 (8.1) (3.6) 4.6 (8.2) (3.5) Economic effect of derivatives Fair value hedges 18.2 (21.4) (3.1) 11.0 (15.8) (4.8) Underlying amounts hedged 31 Dec 22 31 Dec 21 Fair value hedges Cash flow hedges | Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 185| Income Financial Expenses Net effect . Income Financial Expenses Net effect . Assessment of financial liabilities \u2010 (0.6) (0.6) 7.5 (6.4) 1.2 Last year, interest rate derivatives, identified as non-hedge accounting, matured. The category originated in full from restructuring operations and, despite not including instruments that qualify as hedges pursuant to IFRS 9, have as their main objective to hedge against interest rate fluctuations and have no impact on the income statement (mirroring). Sensitivity Analysis - Financial operations Assuming an instant change of 10% in the euro/yen exchange rate, given the same interest rates, the potential decrease in fair value of the derivative financial instruments in place at 31 December 2022 would amount to approximately 13.6 million euro. Likewise, assuming an instant reduction of the same amount, the potential fair value increase would be approximately 16.9 million euro. Given that exchange rate derivatives related to borrowing transactions are treated as fair value hedges, any change in these fair values would not have any effect on the income statement, other than for the credit adjustment part, as any such change would be offset by a movement in the opposite direction of the hedged liability. The assumptions on interest rate changes would have no significant effect on the fair value of outstanding derivative financial instruments on interest and exchange rates. Furthermore, these changes in fair value of financial instruments accounted for as cash flow hedges would have no effect on the income statement if it were not for their potential ineffective portion, which moreover is not significant. In the event of an increase or decrease in fair value, there would be a non-significant increase or decrease in net equity. As to derivatives designated as fair value hedges, any change in fair value would not have any effect on the income statement, other than for the credit adjustment part, as any such change would be essentially offset by a movement in the opposite direction of the hedged liability. Commodity derivatives Commercial portfolio The commercial portfolio includes commodity derivative instruments, both financial and physical, entered into to hedge mismatches between purchase and sale formulas, which are classed into the following categories: Operations management Type 31 Dec 22 31 Dec 21 Fair value hierarchy Notional Fair value assets Fair value liabilities Notional Fair value assets Fair value liabilities Gas formulas 3 2,863,802 MWh 974.7 27,991,358 MWh 1,309.2 Electricity formulas 2 5,293,822 MWh 556.3 4,829,772 MWh 406.8 Exchange 2 \u2010 \u2010 10,408,061 USD 0.1 Gas formulas 3 4,084,098 MWh 901.6 28,987,729 MWh 1,440.8 Electricity formulas 2 3,165,429 MWh 341.1 2,905,219 MWh 175.6 Exchange 2 62,353,000 USD 1.5 30,477,506 USD 0.2 Total fair value 1,531.0 1,244.3 1,716.1 1,616.6 Type 31 Dec 22 31 Dec 21 Income Expenses Net effect Income Expenses Net effect Assessment of derivatives 24.3 (23.0) 1.3 1.6 (1.9) (0.2) Non-hedge accounting | Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 186| Realised cash flows 4,564.8 (4,579.5) (14.7) 1,242.7 (1,279.8) (37.1) Economic effect of derivatives 4,589.2 (4,602.5) (13.4) 1,244.4 (1,281.7) (37.4) The main objectives of these contracts are to replicate the cash flows of the formulas on sale in the market and to cover the spread between the Ttf price, the benchmark market for continental Europe, and the Psv price, the virtual trading point and Italian gas hub. In order to assess the impact that fluctuations in the market price of the underlying asset have on the financial derivatives attributable to the commercial portfolio, the PaR (Profit at Risk) tool is used, that is the change in the value of the portfolio of derivative financial instruments within pre-established probability hypotheses as a result of a shift in market indexes. The increase in the net fair value of commodity derivatives related to the commercial portfolio is mainly due to the increase in the gas price during the year and to the same dynamics recorded during the year for the national price, which is closely related to gas price trends. Overall effect of these instruments on the statement of comprehensive income is broken down as follows: Commodity derivatives commercial portfolio 31 Dec 22 31 Dec 21 Positive components Negative components Net effect . Positive components Negative components Net effect . Changes to expected cash flows 214.7 \u2010 214.7 87.6 \u2010 87.6 Reserve transferred to the income statement 4,579.5 (4,564.8) 14.6 1,279.8 (1,242.7) 37.1 Derivatives effect on statement of comprehensive income cash flow hedge 4,794.2 (4,564.8) 229.3 1,367.4 (1,242.7) 124.7 The net effect of the year\u2019s expected cash flows also includes the change in the fair value of derivative instruments previously measured using hedge accounting, for which the outstanding hedge relationship has been terminated in relation to hedged items that have not yet matured. The components recognised in the statement of comprehensive income will be transferred to profit and loss on the maturity dates of the corresponding hedged positions, which are expected to occur within the next twelve months. The effect of these instruments on the income statement is broken down as follows: Physical contracts treated as derivatives Financial derivative contracts Overall effect Sales revenues 4,067.2 Income 497.7 4,564.8 Purchasing costs (4,367.5) Expenses (212.0) (4,579.5) Effect of realising derivative cash flow hedges (300.3) 285.6 (14.7) Sensitivity analysis - Commercial portfolio In assuming an instant increase of 60 euro/MWh of the TTF, with no change in the national standard price curve, the potential decrease in the fair value of derivative financial instruments held as at 31 December 2022 would amount to approximately 219.8 million euro. On the contrary, an instant fall in the same amount would bring about a potential increase in the fair value of the instruments of approximately 219.8 million euro. In assuming an instant +60 euro/MWh change in the national standard price curve, with no change in the TTF price, the potential increase in the fair value of derivative financial instruments of the commercial portfolio held at 31 December 2022 would amount to approximately 39.7 million euro. On the contrary, an instant change of -60 euro/MWh would bring about a potential decrease in the fair value of the instruments of approximately 39.7 million euro. In the organizational model described above, these changes in fair value would mainly affect derivative instruments accounted for as hedges thus the opposite variation of net equity would be recorded in the income statement. Effects on statement of comprehensiv e income Effects on income statement
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 187|
Trading portfolio
The trading portfolio includes derivatives or similar instruments that are not intended to hedge the
Group\u2019s requirements and are entered into for speculative purposes. these instruments may be divided
into the following categories
Operations management
Type
31 Dec 22
31 Dec 21
Fair value
hierarchy
Notional
Fair value
assets
Fair value
liabilities
Notional
Fair value
assets
Fair value
liabilities
Gas formulas
3
204,228
MWh
8.5
546,478
MWh
20.6
Electricity formulas
2
663,755
MWh
82.7
1,323,041
MWh
60.4
Raw oil
2
4,253 Bbl
0.1
Other commodities
2
3,578 Ton
0.3
Gas formulas
3
67,292 MWh
5.7
682,525
MWh
35.1
Electricity formulas
2
1,274,824
MWh
96.9
2,183,368
MWh
49.9
Raw oil
2
3,839 Bbl
0.1
18,514 Bbl
0.2
Other commodities
2
3,404 Ton
0.6
16,163 Ton
1.3
Total fair value
91.2
103.4
81.3
86.6
Type
31 Dec 22
31 Dec 21
Income
Expenses
Net effect
Income
Expenses
Net effect
Assessment of derivatives
163.7
(170.5)
(6.8)
144.2
(132.7)
11.5
Realised cash flows
146.4
(51.3)
95.1
89.4
(61.3)
28.1
Economic effect of
derivatives
310.1
(221.8)
88.3
233.6
(194.0)
39.6
In order to assess the impact that fluctuations in market prices of the underlying asset have on the
derivatives attributable to the trading portfolio, the VaR (Value at Risk) instrument is used, that is the
negative change in the value of the portfolio of derivative instruments within pre-established probability
hypotheses as a result of an unfavourable shift in market indexes.
The effect of these instruments on the income statement is broken down as follows:
Contracts treated as derivatives
Financial derivative
contracts
Overall effect
Sales revenues
37.2
Income
109.2
146.4
Purchasing costs
(33.4)
Expenses
(17.9)
(51.3)
Effect of realising derivatives
3.8
91.3
95.1
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 188|
The following disclosure provides an analysis of the results of operations for the year ended 31 December
2022 for trading activity, including the effects of energy commodity contracts.
Fair value
Fair value
Delta fair value
Realised
Amounts entered in
the Income
Statement
31 Dec 2022
31 Dec 2021
2022
31 Dec 22
Trading portfolio
Gas, crude oil and other
commodity formulas
2.0
(15.8)
17.8
24.9
42.6
Electricity formulas
(14.2)
10.5
(24.6)
70.3
45.6
Total trading portfolio
(12.2)
(5.3)
(6.8)
95.1
88.3
Sensitivity analysis - Trading portfolio
In assuming an instant increase of 60 euro/MWh of the TTF, with no change in the national standard
price curve, the potential decrease in the fair value of derivative instruments held at 31 December 2022
would amount to approximately 1.2 million euro. On the contrary, an instant fall in the same amount
would bring about a potential increase in the fair value of the instruments of approximately 1.2 million
euro.
In assuming an instant +60 euro/MWh change in the national standard price curve, with equal TTF price,
the potential increase in the fair value of derivative financial instruments of the trading portfolio held at
31 December 2022 would amount to approximately 13.7 million euro. On the contrary, an instant change
of -60 euro/MWh would bring about a potential decrease in the fair value of the instruments of
approximately 13.7 million euro.
Provisions and Contingent Liabilities
30 Post-employment and other benefits
This includes provisions for employee leaving indemnities and other contractual benefits, net of advances
paid out and payments made to the social security institutions pursuant to current regulations. The
calculation is made using actuarial techniques and discounting future liabilities to the balance sheet date.
These liabilities comprise the employee\u2019s matured receivables at the presumed date of leaving the
company.
Opening
balance
Service cost
Financial
expenses
Actuarial
profit
(losses)
Uses
Other
movements
Changes in
the scope of
consolidatio
n
Closing
balance
31 Dec 21
Post-employment
102.2
1.1
(0.1)
0.1
(11.5)
0.2
1.7
93.7
Other benefits
14.5
\u2010
\u2010
(1.7)
(1.1)
\u2010
\u2010
11.7
Total
116.7
1.1
(0.1)
(1.6)
(12.6)
0.2
1.7
105.4
31 Dec 22
Post-employment
93.7
1.4
0.2
(5.1)
(11.3)
\u2010
0.5
79.4
Other benefits
11.7
\u2010
0.1
2.0
(1.2)
\u2010
\u2010
12.6
Total
105.4
1.4
0.3
(3.1)
(12.5)
\u2010
0.5
92.0
\u201cOther benefits\u201d mainly comprises the following:
\u25aa The item Gas discount represents annual indemnities provided to Federgasacqua employees, hired
prior to January 1980, which may be transferred to their heirs;
\u25aa Premungas is a supplementary pension fund for employee members of Federgasacqua hired prior
to January 1980. This fund, closed with effect from January 1997, undergoes changes on a quarterly
basis solely to settle payments made to eligible retirees.
2.02.08
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 189|
\u25aa The item Tariff reduction was set up to cover the charges deriving from the acknowledgement to
retired staff of the electricity business unit of tariff concessions for electricity consumption.
The item \u201cService Cost\u201d regards companies with a small number of employees for whom the employee
severance indemnity fund continues to represent a defined benefit plan.
\u201cFinancial charges\u201d are calculated by applying a specific discount rate for each company, determined on
the basis of the average financial life of the bond.
\u201cActuarial profit (losses)\u201d reflects the re-measurement of the liabilities for employee benefits arising from
changes in actuarial assumptions. These effects are recorded directly in the other items of the
comprehensive income statement.
\u201cChanges in scope of consolidation\u201d includes the post-employement provision acquired following the
business combinations carried out during the period.
The table below outlines the main assumptions used in the actuarial estimate of employee benefits,
subdivided by geographical area:
Central area
North-east area
Technical actuarial yearly rate
3.55%
3.60%
Overall increase of salary yearly rate
2.00%
2.00%
Yearly frequency of exit from work for reasons other than death
1.70%
1.70%
Yarly average frequency of use of severance pay provision
2.20%
2.60%
In interpreting said assumptions, account is taken of the following:
\u25aa with regard to the inflation rate, the inflation assumption was inferred by adopting the Extended
National Consumer Price index of 2.60% for the year 2023 and 1.7% for the following years;
\u25aa for probabilities of death, ISTAT 2021 tables were consulted;
\u25aa in the actuarial valuations, account was taken of the new effective dates for pensions under Law
Decree of 6 December 2011, no. 201 concerning urgent measures for growth, equity, and the
consolidation of public finances, as amended by Law 214 of 22 December 2011, as well as the
regulation for adjusting requirements for accessing the pension system in view of increased life
expectancies in accordance with Article 12 of Legislative Decree no. 78 of 31 May 2010 as amended
by Law 122 of 30 July 2010;
\u25aa For the probability of leaving employment for reasons other than death, an average yearly exit rate
of 1.7% was hypothesized, since the analysis differentiated by professional level and sex did not
result in statistically significant results;
\u25aa to take into account the phenomenon of early leaving, the incidence and amount of average
anticipated severance pay were hypothesized. The frequency of advance payments as well as the
average percentage of severance pay requested as an advance were drawn from corporate data.
The rate of severance pay requested as an advance was hypothesized at 70% of severance pay or
the maximum amount set by current regulations;
Actuarial projections were made on the basis of the Euro Composite AA yield curve at 31 December
2022.
Sensitivity Analysis - Obligations of defined-benefit plans
Assuming a 50 bps increase in the internal rate of return compared to the discount rate actually applied
to value the liabilities at 31 December 2022, all other actuarial assumptions being equal, the potential
decrease of the present value of the obligations of the existing defined-benefit plans (DBO) would amount
to about 1.8 million euro. Likewise assuming a reduction of this rate of 50 bps, there would be an increase
in the present value of the liabilities of about 1.9 million euro.
Assuming a 50 bps increase in the in the rate of inflation compared to that actually applied to value the
liabilities at 31 December 2022, all other actuarial assumptions being equal, the potential increase of the
present value of the obligations of the existing defined-benefit plans (DBO) would amount to about 1.2
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 190|
million euro. Likewise assuming a reduction of this rate of 50 bps, there would be a decrease in the
present value of the liabilities of about 1.1 million euro.
Changes in the remaining actuarial assumptions would not produce significant effects on the present
value of the liabilities of the defined-benefit plans reported in the financial statement.
31 Provisions for risks and charges
Opening
balance
Provisions
Financial
expenses
Uses
Other
movements
Changes in
the scope of
consolidation
Closing
balance
31 Dec 21
Provision third-party asset
restoration
232.2
9.2
5.4
\u2010
(39.3)
\u2010
207.5
Provision for closure and post-
closure landfill expenses
179.0
5.6
13.2
(17.5)
2.3
\u2010
182.6
Provision for personnel legal cases
and disputes
14.5
3.1
\u2010
(5.8)
(1.1)
\u2010
10.7
Provisions for waste disposal
6.7
7.2
\u2010
(6.4)
\u2010
0.6
8.1
Provision for plants dismantling
5.9
\u2010
0.1
\u2010
\u2010
\u2010
6.0
Other provisions for risks and
charges
99.9
28.0
\u2010
(1.5)
(14.9)
1.6
113.1
Total
538.2
53.1
18.7
(31.2)
(53.0)
2.2
528.0
31 Dec 22
Provision third-party asset
restoration
207.5
6.3
4.1
\u2010
\u2010
\u2010
217.9
Provision for closure and post-
closure landfill expenses
182.6
6.0
8.0
(13.5)
3.2
\u2010
186.3
Provision for personnel legal cases
and disputes
10.7
2.4
\u2010
(1.3)
(1.0)
0.1
10.9
Provisions for waste disposal
8.1
9.3
\u2010
(7.6)
(0.1)
\u2010
9.7
Provision for plants dismantling
6.0
\u2010
0.1
\u2010
\u2010
\u2010
6.1
Other provisions for risks and
charges
113.1
44.0
\u2010
(5.6)
(16.8)
\u2010
134.7
Total
528.0
68.0
12.2
(28.0)
(14.7)
0.1
565.6
The \u201cProvision for third-party asset restoration\u201d includes provisions made in relation to law and
contractual requirements for the Group companies as lessees of the distribution networks of the entity
that owns the assets. The allocations are made on the basis of depreciation rates held to be
representative of the remaining useful life of the assets in question in order to compensate the owner
companies for the wear and tear of the assets used for business activities. The provision reflects the
present value of these outlays which will be determined in future periods (usually on expiry of the
agreements entered into with the area agencies, as far as the water service is concerned, and on expiry
of the transitory period anticipated by current legislation as far as gas distribution is concerned). The
increases in the provision comprise the sum total of the provisions for the year, including those
discounted to present value, and the financial charges for the period associated with the cash flows
discounted to present value.
The decrease in provisions compared to the previous year is mainly affected by the end of the extended
management of the water service in the province of Rimini at 31 December 2021. The tender, which was
also awarded to the Hera Group, stipulates that the assets are to remain under the management of the
owner companies and are therefore not to be entrusted to the operator. The decrease in financial
expenses compared to the previous period is determined by the annual update of the parameters used
to reflect current market conditions (Wacc).
The \u201cProvision for landfill closure and post-closure expenses\u201d represents the amount set aside to cover
the costs which will have to be incurred for the management of the closure and post-closure period
pertaining to the landfills currently managed. The future outlays, calculated for each landfill by means of
a specific appraisal, have been discounted to present value. The increases in the provision comprise the
financial component derived from the discounting process and provisions due to changes in the
assumptions about future outlays, following the change in expert estimates on closed landfills.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 191|
Financial expenses decreased compared to the previous year due to the different effects arising from
the yearly update of the parameters used to reflect current market conditions (Wacc), as well as the
revision of the assumptions on the timing of future disbursements. Uses represent actual disbursements
that occurred during the year, while are \u201cOther movements\u201d mainly includes estimated closure and post-
closure costs in relation to newly constructed landfills and the changes in the estimated closure and post-
closure costs of active landfills, which entailed the recording of an adjustment of the same amount as the
value of tangible assets (landfill asset), totalling 1.9 million euro for the year 2022.
The \u201cProvision for legal cases and disputes brought by personnel\u201d reflects the outcomes of lawsuits and
disputes brought by employees.
\u201cProvision for plants dismantling\u201d includes the amounts allocated for the future dismantling of the plants
for cases in which it is mandatory.
\u201cProvision for waste disposal\u201d reports the estimated costs of disposal of the waste already stored at the
Group\u2019s plants. The provisions reflect the estimated costs of contributions for the year 2022 not yet
processed at the end of the financial period, while the uses represent the costs incurred over the period
for the processing of waste that was residual as at 31 December 2021.
\u201cOther provisions for risks and charges\u201d comprises provisions made against sundry risks. Below, there
is a description of the main items:
Liabilities
Type
Amount
(mn \u20ac)
The higher cost of the electricity used in the water service provision was not
recognised, due to the volatility of the energy market, which resulted in price values
for the period that were higher than the allowed maximum limit provided for by the
tariff system.
Likely
18.5
The amount of the WTE and cogeneration plants\u2019 green certificates, calculated
according to the difference between auxiliary services resulting from total self-
consumption and services estimated on the basis of the benchmark percentage,
was not recognised;
Likely
14.0
Outstanding bonds (guarantee on financial exposure given by AcegasApsAmga
Spa) in case of abandonment of the operations run by the foreign subsidiary
AresGas (Bulgaria).
Contingent
11.3
Risks arising from the activity of energy efficiency upgrading of buildings carried out
on behalf of end customers, particularly apartment blocks
Likely
11.3
Reimbursement of a portion of the sewerage and purification tariffs for the water
service
Likely
6.1
Potentially higher expenses that may be incurred in connection with extraordinary
maintenance on the Ponte San Nicol\u00f2 (Padua) landfill
Contingent
5.2
Potential litigations arising from the risk of disputes in relation to the gas distribution
unit of the Veneto and Friuli Venezia-Giulia regions, which was sold at the end of
2019
Likely
3.5
The liabilities classified as contingent were recognised as part of the business combination in the year in
which it occurred.
Provisions in this category, which amounted to 44 million euro, showed an increase compared to the
previous year, mainly due to legislative and regulatory risks. The reduction of 16.8 million euro, classified
as \u201cOther movements\u201d is mainly attributable to the following:
release of provisions recorded in previous years, valued in excess of the actual liability, in the amount of
10.9 million euro. These refer, in the amount of 6.5 million euro, to the approval of applications submitted
in relation to the full recognition of electricity costs incurred in the water service sector for the year 2021,
the full remuneration of which will be guaranteed by means of the tariff in subsequent years;
partial offsetting of the provision for risks set aside in previous years for the non-recognition of green
certificates, in the amount of 4.7 million euro, with a similar amount of receivables recorded under current
assets for certificates.
The \u201cChange in the scope of consolidation\u201d include the provisions of the companies acquired during
2022.
For detailed information on risk provisions for tax litigations, see note 12 \u201cTaxes\u201d.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 192|
Operating working capital
notes
31 Dec 22
31 Dec 21
Change
Inventories
32
995.1
368.0
627.1
Commercial receivables
33
3,875.0
2,918.0
957.0
Commercial payables
34
(3,093.1)
(2,356.6)
(736.5)
Current tax assets
13
46.0
21.2
24.8
Current tax liabilities
13
(17.1)
(27.9)
10.8
Other current assets
35
642.5
422.3
220.2
Other current liabilities
36
(1,720.0)
(1,435.6)
(284.4)
Operating working capital
728.4
(90.6)
819.0
Operating working capital consists of the same components as net working capital, as defined by the
alternative performance indicators in Section 1.04 \u201cOverview of operating and financial trends and
definition of alternative performance measures,\u201d with the exception of current portions of assets and
liabilities for commodity derivatives.
The change in the year 2022 with respect to the comparative period is mainly due to the increase in
methane gas inventories, as detailed in Note 32 \u201cInventories\u201d.
32 Inventories
31 Dec 22
31 Dec 21
Change
Gas stocks
468.6
58.9
409.7
Raw materials and stocks
57.6
50.5
7.1
Materials earmarked for sale and final products
19.5
6.7
12.8
Contract work in progress
449.4
251.9
197.5
Total
995.1
368.0
627.1
\u201cGas stocks\u201d includes methane gas stocks held by the Group at the end of the period, which during the
2023 financial period will be used to supply gas to its customers. Change from the previous year was
due to:
\u25aa the significant increase in wholesale raw material prices as compared to 2021, was most noticeable
at the time of placing in storage.
\u25aa higher volumes in stock at the end of the period, which increased by 85% compared to 31 December
2021.
The book value of gas stocks is recoverable on the basis of gas sales made after the end of the financial
period and forward sales contracts already signed by the Group at the date of the financial statements.
\u201cRaw materials and stocks\u201d, already presented net of an associated obsolescence provision, mainly
includes:
31 Dec 22
31 Dec 21
Change
Spare materials and equipment
49.8
44.0
5.8
Plastic materials
7.4
6.5
0.9
Other fuels
0.4
\u2010
0.4
Total
57.6
50.5
7.1
\u201cMaterials earmarked for sale and finished products\u201d, already shown net of the relevant provision for
depreciation, mainly consists of:
2.02.09
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 193|
31 Dec 22
31 Dec 21
Change
Plastic products
12.2
5.8
6.4
Material for photovoltaic systems
6.7
0.6
6.1
Telecommunications equipment
0.6
0.3
0.3
Total
19.5
6.7
12.8
The change for the period is due to both the significant increase in the prices of virgin polymer for the
manufacture of plastic products and the increased volume of operations of the photovoltaic business.
The item \u201cContract work in progress\u201d includes long-term contracts for plant construction work, mainly in
relation to the following businesses:
31 Dec 22
31 Dec 21
Change
Energy services
384.9
199.1
185.8
Water services
27.3
21.3
6.0
Public lighting
23.7
23.4
0.3
Other minor items
13.5
8.1
5.4
Total
449.4
251.9
197.5
The change in the period is mainly related to the energy requalification of apartment buildings, especially
apartment buildings, a business that has strongly increased in 2022 partly thanks to the Group\u2019s strategic
choices aimed at combating climate change.
33 Commercial receivables
31 Dec 22
31 Dec 21
Change
Receivables from customers
2,051.1
1,842.9
208.2
Provision for bad debts
(552.0)
(444.6)
(107.4)
Receivables from customers for bills and invoices not yet issued
2,375.9
1,519.7
856.2
Total
3,875.0
2,918.0
957.0
Trade receivables comprise estimated consumption, for the portion pertaining to the period, relating to
bills and invoices which will be issued after 31 December 2022, as well as receivables for revenues
coming due during the period, referring to the water sector which will be billed in the following period, in
accordance with the billing methods for final customers established by the relevant Authority.
The increase from the previous year in the stock of receivables managed compared to the previous year
was mainly due to:
\u25aa the increase in the market prices of gas and electricity commodities, which led to a corresponding
increase in the value of both sales to end customers and brokerage transactions in wholesale markets
carried out at the end of the financial year and which will financially settle in early 2023;
\u25aa the greater number of energy end-users served in the country following the allocation of the relevant
supply tenders (as mentioned in sections 1.07.01 \u201cGas\u201d and 1.07.02 \u201cElectricity\u201d of the Directors\u2019
Report).
The value of trade receivables reported in the financial statements at 31 December 2022 represents the
Group\u2019s maximum exposure to credit risk. Changes in the provision for bad debts is as follows:
Opening balance
Provisions
Changes in the
scope of
consolidation
Uses and other
movements
Closing balance
2021 financial year
394.4
94.4
1.8
(46.0)
444. 6
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 194| 2022 financial year 444.6 133.9 1.8 (28.3) 552.0 The recording of the provision is made on the basis of analytical valuations in relation to specific receivables, supplemented by measurements made based on future-oriented analyses of the receivables regarding the general body of customers (in relation to the age of the receivables, the type of recovery action undertaken and the status of the debtor), as described in the section \u201cRisk management\u201d in paragraph 2.02.01 \u201cIntroduction\u201d. The change in the provision with respect to the previous year is mainly due to the markets of last resort, which experienced a significant increase in the number of customers and consequently in the volumes managed, in a scenario also characterised by high prices, which further increased the nominal value of the receivables managed. For traditional energy markets, the provision for the year 2022 was in line with the previous year, as the increase in exposure due to higher prices was more than offset by improved collection performance. In fact, the 24-month unpaid ratio of the Group\u2019s sales companies, calculated net of the markets of last resort for gas, decreased to 0.71%, compared to 0.85% in the previous year. Confirming the continuous trend of improvement over the last few years, the use of the provision fell sharply compared to the previous year. The following table displays receivables for invoices issued relative to all customer clusters, organized by degree of past-due: 31 Dec 22 Inc.% 31 Dec 21 Inc.% Change Not yet due 824.2 40% 772.3 42% 51.9 Due 0-30 days 179.5 9% 214.5 12% (35.0) Due 31-180 days 287.3 14% 145.0 8% 142.3 Due 181-360 days 151.2 7% 98.8 5% 52.4 Due beyond 360 days 608.9 30% 612.3 33% (3.4) Total 2,051.1 1,842.9 208.2 34 Commercial payables 31 Dec 22 31 Dec 21 Change Payables to suppliers 890.3 741.2 149.1 Payables to suppliers for invoices not yet received 2,202.8 1,615.4 587.4 Total 3,093.1 2,356.6 736.5 The change of commercial payables compared to the previous year is mainly due to: \u25aa the increase of gas and electricity wholesale prices, which led to an increase in the purchase costs of raw materials with a resulting higher liability towards suppliers; \u25aa the increase in the volume of energy efficiency upgrading of buildings carried out on behalf of end customers, particularly apartment buildings, which led to a subsequent increase in payables to suppliers and professionals carrying out the works. Analysis of overdue receivables
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 195|
35 Other current assets
31 Dec 22
31 Dec 21
Change
Fund for energy and waste management services for
equalisation and continuity income
119.6
49.9
69.7
VAT, excise and additional taxes
86.6
47.6
39.0
Tax credits and benefits
79.8
20.2
59.6
Receivables from electricity and gas sector companies
76.1
\u2010
76.1
Advances to suppliers
76.1
42.7
33.4
Security deposits
59.8
121.0
(61.2)
Energy efficiency bonds and emissions trading
40.9
46.9
(6.0)
Pre-paid costs
29.5
26.5
3.0
Incentives from renewable sources
10.6
23.4
(12.8)
Other receivables
63.5
44.1
19.4
Total
642.5
422.3
220.2
\u201cFund for energy and waste management services for equalisation and continuity income\u201d comprises
36.3 million euro of equalisation credit (27.7 million euro at 31 December 2021) and 83.3 million euro of
continuity income (22.2 million euro at 31 December 2021).
Continuity income increased by 61.1 million euro compared to the previous year mainly due to two
effects:
\u25aa on the one hand, the measures introduced by the government in autumn 2021, aimed at containing
energy tariffs, provided for both the cancellation of most system charges and the extension of social
gas and electricity bonuses. The application of these tariff reduction measures (as indicated in the
regulatory context in paragraph 1.01.01 of the Directors\u2019 Report), which were not imposed on market
operators, resulted in a significant receivable from the Fund for energy and waste management
services. This credit exposure, which increased sharply compared to the previous year, was subject
to operations to optimise collection times, but still generated a net increase of 28.5 million euro;
\u25aa on the other hand, the recognition on the basis of Resolution 44/2022 issued by ARERA for the costs
incurred for default gas and last resort supply services for the year 2022 resulted in a change of 27
million euro compared to the previous year, bringing the value of the receivable to be collected for
the recognition of costs incurred for operating on these markets to a total of 34.5 million euro at 31
December 2022.
Equalisation credit increased by 8.6 million euro compared to the previous year, with a diversified
dynamic in the various regulated sectors, particularly as a result of the trend in volumes distributed in the
gas business.
\u201cVAT, excise and additional taxes\u201d includes payables for VAT in the amount of 18 million euro (6.1 million
euros at 31 December 2021), and excise and additional taxes in the amount of 68.6 million euro (41.5
million euro at 31 December 2021). With regard to excise duties and additional taxes, the procedures
governing the financial relations with the tax authorities should be taken into account: as a matter of fact,
advance payments made during the year are calculated on the basis of the quantities of gas and
electricity billed in the previous year, while the actual debt is generated on the basis of the volumes sold
in the period. These methods can generate credit or debit positions with differences that may be
significant even between one period and another.
The change as compared to 31 December 2021 is attributable to a decrease of 11.9 million euro in
receivables for value added tax and an increase of 27.1 million euro in receivables for excise and
additional taxes. For a better understanding of the Group\u2019s net exposure to value added tax, please refer
to the commentary in Note 36 \u201cOther current liabilities\u201d. The increase in receivables for excise duties and
additional taxes, on the other hand, is mainly due to the lower volumes of gas sold in the 2022 financial
year compared to the previous period to customers on the free and safeguarded market in the north-
eastern area, due to the milder climate and energy-saving behaviour adopted by users to cope with the
high cost of energy.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 196|
\u201cTax credits and benefits\u201d mainly include:
\u25aa tax credits arising from the application of the invoice discount to end customers, stated at their market
value, in relation to subsidised energy efficiency measures, amounting to 44.1 million euro. These
measures are mainly related to building renovation activities on apartment buildings;
\u25aa credits arising from the Government\u2019s regulatory measures in relation to electricity and gas costs for
electricity and gas-consuming companies, which will be used as offsets in the 2023 financial year, as
provided for by current tax regulations, amounting to approximately 23 million euro;
\u25aa credits for investments in capital goods, including those related to Industry 4.0, totalling 5.8 million
euro, which will be used to offset taxes and contributions in subsequent years on the basis of the
annual limits provided for.
\u201cReceivables from electricity and gas sector companies\u201d mainly include receivables from the distribution
companies As a result of the same dynamics set forth above in the commentary on continuity income,
these positions were generated especially at 31 December 2022 as a result of the crediting to end
customers, carried out by the distribution companies through the sales companies, of the social bonuses
envisaged by the measures introduced by the Government as from autumn 2021 (subsequently
enhanced both in terms of value and beneficiary population) and of the Ug2c component, which is
negative, introduced since 1 April 2022. For these reasons, the value of the credited items exceeded the
debiting of the distribution fees, resulting in a reversal of the typical commercial balance.
In the item \u201cAdvances to suppliers\u201d, the increase compared to the previous year is mainly due to the
increase in the volume of energy efficiency work in buildings on behalf of customers, mainly apartment
blocks, and the subsequent requests from the Group\u2019s partner suppliers in carrying out the work.
\u201cSecurity deposits\u201d mainly includes deposits provided as security for participation in foreign platforms
that deal in commodity contracts, auctions on the electricity market, and to secure transactions on
wholesale markets for electricity and natural gas, totalling 49.3 million euro; The decrease compared to
the previous year is due to lower operations carried out in the period, especially on the Eex platform, as
a result of the Group\u2019s decision to shift to other forms of exchange contracts, also due to the volatility of
commodity prices.
\u201cEnergy efficiency bonds and emissions trading\u201d, includes the following:
31 Dec 22
31 Dec 21
Change
Grey certificate.
20.8
14.4
6.4
White certificates
15.0
22.7
(7.7)
Green certificates
5.1
9.8
(4.7)
Total
40.9
46.9
(6.0)
The portfolio of grey certificates reflects the valuation of both securities held by the Group for 10.1 million
euro (7.4 million euro at 31 December 2021) and the exposure for forward contracts to buy and sell
greenhouse gas emission allowances for 10.7 million euro (7 million euro at 31 December 2021). The
increase as compared to 2021 is mainly due to a volume effect, the market price being substantially in
line with the previous period.
\u25aa The portfolio of white certificates includes the valuation of both securities calculated on the basis of
the energy efficiency targets set by the GSE for gas and electricity distribution companies, net of
disposals that occurred in the period, for 13.1 million euro (20.8 million euro at 31 December 2021),
and securities originating from energy efficiency measures implemented by the Group for 1.9 million
euro (in line with the previous year). The decrease, with substantially the same valuation of the
contribution compared to the previous year and with higher allocated targets for the obligation year
2022 compared to the obligation year 2021, is mainly due to both different ways of fulfilling obligations
highlighted in the 2022 financial year and to the higher quantity of disposals.
\u25aa At 31 December 2022, the green certificate portfolio included securities recognised on an accrual
basis prior to 2016 in relation to the electricity production of the waste-to-energy plant in Ferrara.
These securities are the subject of a complaint by the GSE concerning the methodology for
calculating the self-consumption of auxiliary services. In the course of 2022, positions amounting to
4.7 million euro concerning other plants affected by a similar calculation method were closed, as they
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 197|
were deemed to be definitively non-collectable. For the partial closure of the portfolio, the relevant
risk provision, which had already been set aside in previous years, was compensated by an equal
amount, as explained in Note 31 \u201cProvisions for risks and charges\u201d.
\u201cPrepaid costs\u201d mainly comprise future accruals in respect of:
31 Dec 22
31 Dec 21
Change
Outsourced services and processing
14.6
13.7
0.9
Insurance, bank sureties and commissions
5.0
4.3
0.7
Rents payables and concession fees for network services
2.7
2.3
0.4
Other minor items
7.2
6.2
1.0
Total
29.5
26.5
3.0
\u201cIncentives from renewable sources\u201d consists of receivables from the GSE for the new incentive
mechanism to promote the production of electricity from renewable sources. Incentives for the period
decreased sharply compared to the 2021 financial year, as the price of incentives (Grin) was reduced,
which is inversely proportional to the previous year\u2019s national electricity price (Pun).
The item \u201cOther receivables\u201d includes:
31 Dec 22
31 Dec 21
Change
Extraordinary contributions
22.6
\u2010
22.6
Water leakage provision receivables
6.2
10.6
(4.4)
Receivables from asset companies
6.0
5.7
0.3
Other minor items
28.7
27.8
0.9
Total
63.5
44.1
19.4
\u25aa Extraordinary subsidies include the amount certain Group companies paid, yet deemed not due, during the year
2022 in respect of the \u201cExtraordinary extra-profits subsidy\u201d, established for the year 2022 by Article 37 of
Legislative Decree no. 21/2022. These amounts were paid to the State Treasury on the due dates, despite
significant doubts as to their application, in order to avoid penalties and interest. The subsequent 2023 Budget
Law, which in paragraphs 120 and 121 of Article 1 changed the subjective scope and the taxable base of the
contribution for the year 2022, made it possible to exclude one Group company from the scope of application,
however failed to clear the application doubts in respect of a second impacted company. In both cases, the Group
filed for reimbursement, thus recording the amount paid under other current assets;
\u25aa receivables for water leakage provisions includes amounts charged and not yet collected from users for insurance
in case of leaks;
\u25aa Receivables from asset companies include receivables from companies that own the networks and from related
assets used by the Group to provide utility services.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 198|
36 Other current liabilities
31 Dec 22
31 Dec 21
Change
Payables for advances to the fund for energy and waste
management services
441.8
336.9
104.9
Security deposits from customers
383.3
129.8
253.5
Plant investment grants
239.5
228.7
10.8
Advances for works
106.7
50.4
56.3
Fund for energy and waste management service components
and equalisation
99.5
85.8
13.7
VAT, excise and additional taxes
83.0
155.0
(72.0)
Personnel and employee withholding
82.8
81.7
1.1
Payables to social security institutions
69.4
63.6
5.8
Energy efficiency bonds and emissions trading liabilities
51.6
49.2
2.4
Receivables from electricity and gas sector companies
34.7
\u2010
34.7
Prepaid revenues and other expenses
32.4
167.6
(135.2)
Other payables
95.3
86.9
8.4
Total
1,720.0
1,435.6
284.4
\u201cPayables for advances to the Fund for energy and waste management services\u201d comprises non-interest-
bearing advances granted by the Fund for energy and waste management services, as follows:
\u25aa 243.3 million euro (233.4 million euro at 31 December 2021) for advances in compliance with the
integration mechanism set forth by resolution 370/2012/R/Eel and 456/2013/R/Eel by ARERA, for
overdue and unpaid receivables from customers managed under a safeguard regime. The latest
reports concern the years 2009-2020;
\u25aa 182.2 million euro (90 million euro at 31 December 2021) in compliance with the integration
mechanism set forth in Law 239 of 23 August 2004 and by ARERA\u2019s Tivg , for the charges for
delinquency of services of last resort in the natural gas sector (Fui, Ftf and Fdd) until the 2019-2021
thermic years;
\u25aa 12.9 million (11.8 million euro at 31 December 2021) in compliance with Resolution 32/2021/R/Eel
(former Resolution 445/2020/R/Eel), relating to the procedures for accessing the reimbursement
mechanism for general system charges not collected from end customers and already paid to
distribution companies for 2016-2020. The scope is restricted to the sale of electricity on the free
market, the Safeguard market (disconnectable) and the gradual protection service (disconnectable).
\u201cSecurity deposits from customers\u201d reflect the amounts requested from customers for gas, water and
electricity provision contracts. The significant increase for the period is mainly due to:
\u25aa the award of six lots of the gas last resort service and a further nine lots of the gas distribution default
service for the period 1 October 2021 - 30 September 2023;
\u25aa the award of four lots of the Consip EE19 tender for the supply of electricity to public administrations
in 2022;
\u25aa the increase in commodity prices that occurred during the period, which was reflected in a higher
value of security deposits charged to customers.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 199|
\u201cPlant investment grants\u201d decreases in proportion to the amount of depreciation calculated on the fixed
assets in question and increases as a result of new investments subject to grants. The item includes
specifically, the following grants received by the Group:
31 Dec 22
31 Dec 21
Change
New water system investment fund;
87.1
73.0
14.1
Purification plant in Servola (Trieste)
33.0
36.0
(3.0)
Purification and sewarage systems
32.0
33.2
(1.2)
Construction of rolling basins e underwater pipes in the area of
Rimini.
20.6
21.5
(0.9)
Other minor items
66.8
65.0
1.8
Total
239.5
228.7
10.8
\u201cAdvances for works\u201d includes advances received from municipalities and apartment buildings for works
in progress relating to public lighting and energy efficiency upgrades of private buildings, respectively,
which will be completed in the following years. The significant increase is in line with the increase in
energy efficiency work carried out by the Group, as reported in Note 1 \u201cRevenues\u201d.
\u201cFund for energy and waste management service components and equalisation\u201d, reflects the liabilities
for the Fund for energy and waste management services mainly due to some system components of the
gas, water and electricity service for 84.1 million euro (84.8 million euro at 31 December 2021) and
equalization of the electricity service for 15.4 million euro (1 million euro at 31 December 2021).
\u201cVAT, excise and additional taxes\u201d includes payables for VAT in the amount of 0.9 million euro (78.9
million euro at 31 December 2021), and excise and additional taxes in the amount of 82.1 million euro
(76.1 million euro at 31 December 2021). As outlined in Note 35, \u201cOther current assets\u201d, this increase
must be understood taking into account the factors that regulate financial relations with the Inland
Revenue Office, which can generate credit/debit positions with differences that can be significant even
between one financial period and another.
With regard to value-added tax, the decrease in the year was mainly related to the payment of the
advance concerning the Group VAT for 90.3 million euro at the end of the financial period, which resulted
in a credit balance as at 31 December, whereas last year, in application of the historical method, the
advance had not been paid. The payment of the advance depended on the dynamics of the turnover
issued, in particular relating to the greater volumes on the markets for last resort gas services and the
trend in energy commodity prices, which increased the taxable base, even in the presence of a reduction
in the rate to 5% for the supply of methane gas for residential and industrial use, which only partially
mitigated the volumetric effect.
With regard to excise and additional taxes, the advance payment in 2022 was made, as required by the
regulations in force, on the basis of the volumes invoiced in the previous year. However, the accrued
liability was generated on the basis of the volumes invoiced in the year 2022 which were higher than in
the year 2021.
\u201cPersonnel and employee withholding\u201d includes for the most part the vacation time accrued and not used,
as well as the productivity bonuses accounted for by department, plus withholding taxes to be paid to the
State treasury as tax substitute for employees.
\u201cPayables to social security institutions\u201d relates to contributions owed to these institutions for the
December salaries, performance bonuses and additional monthly payments under national collective
agreements.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 200|
\u201cEnergy efficiency bonds and emissions trading\u201d, includes:
31 Dec 22
31 Dec 21
Change
Grey certificate.
22.5
17.2
5.3
White certificates
17.9
26.7
(8.8)
Guarantee of origin certificates
11.2
5.3
5.9
Total
51.6
49.2
2.4
Grey certificates reflect the valuation of both the forward sale and purchase contracts of greenhouse gas
emission allowances in the amount of 11.8 million euro (6.6 euro million at 31 December 2021) and the
obligation to redeliver certificates calculated on the basis of current regulations in the amount of 10.7
million euro(10.6 million euro at 31 December 2021). The change compared to the previous year is due
to higher volumes of forward contracts, while market prices were largely unchanged.
White certificates include, beginning in the 2021 financial year, the valuation of exposure with respect to
obligations to return energy efficiency certificates not yet in the portfolio to the relevant authorities. The
change as compared to 31 December 2021 is mainly due to the decrease in certificates not yet cancelled
in respect of the years for which the Group has not yet fully complied with the allocated accrual obligation.
Guarantee of origin (GO) certificates concern certification obligations for electricity produced from
renewable energy sources for sales made to customers with this type of supply. The increase in the
liability is due to the increase in the market price over the course of 2022.
\u201cReceivables from electricity and gas sector companies\u201d mainly include receivables entered by the
Group\u2019s distribution companies against third-party sales companies These positions were generated at
31 December 2022 as a result of the measures against high energy prices, as illustrated in Note 35
\u201cOther current assets\u201d in the item \u201cReceivables from electricity and gas companies\u201d.
The item \u201cAnticipated revenues and other expenses\u201d comprises portions of revenues already invoiced
falling due in the following financial period. The item specifically comprises for 9 million euro (146.8 million
euro at 31 December 2021) invoices issued at the end of 2021 for energy efficiency operations benefiting
from tax incentives for which the work will be completed in the 2023 financial year.
The item \u201cother payables\u201d mainly comprises the following:
31 Dec 22
31 Dec 21
Change
Tariff concessions to users
11.5
12.8
(1.3)
Environmental damage contributions
11.3
11.4
(0.1)
Insurance deductibles
9.8
12.2
(2.4)
Delinquency payments for electricity gas and other sectors
9.5
5.9
3.6
Other minor items
53.2
44.6
8.6
Total
95.3
86.9
8.4
Specifically:
\u25aa environmental damage contributions represent the payments to be made to municipalities, on the
basis of specific agreements, as compensation for activities that impact on the environment for waste
delivered to plants in their municipal territories. The amount of these contributions is related to the
amount of waste disposed of annually;
\u25aa insurance deductibles include amounts that the Group must repay directly to damaged third parties
or insurance companies;
\u25aa delinquency payables in the electricity, gas and other sectors mainly represent the amounts, charged
to end users, to be retroceded as compensation to previous suppliers who were in arrears for the last
three monthly payments, prior to their transition to the Hera Group. This indemnity is applied only to
certain specific categories of users, identified by ARERA Resolution no. 593/2017/R and its
subsequent amendments and additions.
\u25aa
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 201|
37 Cash flows of operating activities
Changes in net working capital
The following is a breakdown of information on changes in financial liabilities during the 2022 financial
year, differentiating between cash flows and non-cash flows.
Type
31 Dec 22
31 Dec 21
Change
(a)
Non-cash flows
Cash flows
(f)=[(b)+(c)+(
d)+(e)]-(a)
Acquisitions
divestitures
(b)
Economic
valuation
components
(c)
Changes in fair
value
(d)
Other
changes
(e)
Inventories
995.1
368.0
627.1
0.1
0.2
(0.6)
(627.4)
Commercial
receivables
3,875.0
2,918.0
957.0
13.6
(133.5)
11.0
(214.8)
(1,280.7)
Commercial
payables
(3,093.1)
(2,356.6)
(736.5)
(8.8)
0.1
727.8
Other current
assets/liabilities
(1,077.5)
(1,013.3)
(64.2)
(2.0)
13.7
(4.8)
181.6
252.7
Changes in
working capital
699.5
(83.9)
783.4
2.9
(119.6)
6.2
(33.7)
(927.6)
\u201cAcquisitions and divestitures\u201d includes the effects of the acquisitions of control carried out during 2022,
as illustrated in detail in the section \u201cBusiness Combinations (supplementary information)\u201d of paragraph
2.02.10 \u201cOther information\u201d.
\u201cEconomic valuation components\u201d mainly includes:
\u25aa the provision for bad debts for a negative 133.9 million euro, as illustrated in Note 33 \u201cCommercial
receivables\u201d;
\u25aa the portions pertaining to the period of plan related grants, the total amount of which was collected in
previous years, totalling a positive amount of 12.8 million euro, as stated in Note 2 \u201cOther operating
revenues\u201d.
\u201cChanges in fair value\u201d includes:
\u25aa the valuation at current market value of receivables resulting from the application of the invoice
discount in connection with energy efficiency measures for end customers, held for to be transferred
to financial institutions, for a positive 11 million euro; For further details on the Group\u2019s accounting
policy, please see Note 11 \u201cFinancial expenses\u201d
\u25aa the valuation of environmental certificates and greenhouse gas emission obligations assigned to the
Group, as well as the valuation of forward contracts for the purchase and sale of greenhouse gas
emission allowances, for a total negative 4.8 million euro, as illustrated in Note 35 \u201cOther current
assets\u201d and 36 \u201cOther current liabilities\u201d.
\u201cOther changes\u201d mainly comprises offsets within net working capital of transactions involving the gross
recognition of assets and liabilities. It should also be noted, as already indicated in Note 20 \u201cCash Flows
from financing activities\u201d, the reclassification of non-monetary flows related to the transfer of tax credits
arising from the application of the invoice discount for energy efficiency measures, in the amount of 46.3
million euro.
Dividends collected
In 2022, dividends for 9.4 million euro were received from companies consolidated according to the
equity method and 4 million euro from shareholdings held in other companies. For further details, please
see note 10 \u201cFinancial income\u201d and 26 \u201cShareholdings\u201d.
Net interest paid
The following is a reconciliation of the balance sheet values of financial income and expenses and the
related net cash flows for the year.
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 202| Type 2022 (a) Non-cash components Other changes (d) Cash components (e)=(a)-[(b)+(c)+(d)] Economic valuation components (b) Changes in fair value (c) Financial income 82.2 4.7 25.0 10.7 41.8 Financial expenses (217.2) (63.0) (6.9) (19.3) (128.0) Total (135.0) (58.3) 18.1 (8.6) (86.2) \u201cEconomic valuation components\u201d includes income and expenses arising from both the measurement at amortised cost and the discounting of receivables and liabilities characterised by monetary outlays to be carries out in the medium- to long-term period, as illustrated in Note 10 \u201cFinancial income\u201d and Note 11 \u201cFinancial expenses\u201d. \u201cChanges in fair value\u201d includes measurements at current market value of financial assets and liabilities, mainly relating to: \u25aa receivables arising from the application of the invoice discount in relation to energy efficiency measures for end customers for a positive 11.2 million euro. For further details on the Group\u2019s accounting policy, please see Note 11 \u201cFinancial expenses\u201d; \u25aa fair value valuation of put options and contingent consideration for a total net effect of a positive 7 million euro. \u201cOther change\u201d mainly includes: \u25aa interest cash flows recognised on an accrual basis and not yet paid at 31 December 2022; \u25aa the components of income collected and expenses paid during the year, with the associated cash flows reported in specific items of the cash flow statement, mainly related to dividends dividends paid by other minor holdings. Taxes paid The breakdown of flows by tax type is as follows: 31 Dec 22 31 Dec 21 Income taxes 131.9 148.2 Extraordinary contributions 24.9 \u2010 Substitute tax 9.1 9.2 IRES refund \u2010 (1.1) Taxes paid 165.9 156.3 Income taxes include the amount paid by the Group during the year 2022 in relation to the 2021 IRES and IRAP balances and the advance payments due for the year 2022. Extraordinary contributions represent the amount paid during the 2022 financial year in relation to the \u201cExtraordinary extra-profit contribution\u201d. For further details see Notes 12 \u201cTaxes\u201d and 35 \u201cOther current assets\u201d. The substitute tax includes, at 31 December 2022, the amount paid in relation to the exemption of controlling interests in connection with the acquisitions of Eco Gas Srl and Vallortigara Servizi Ambientali Spa. At 31 December 2021, the item included the amount paid in relation to the tax realignment regulation for goodwill, as outlined in note 12 \u201cTaxes\u201d.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 203|
Other information
Business combinations (supplementary information)
Business combinations have been accounted for on the basis of assessments conducted by
management in respect of analyses of the fair value of assets and liabilities and contingent liabilities, in
line with information concerning facts and events available at the date of acquisition. The evaluation
process of all operations ended on 31 December 2022.
The table below shows the assets and liabilities acquired as part of business combinations carried out
during the year, recognised at their fair value.
Alibardi
Fiorenzo Srl
Con Energia
Spa
Macero
Maceratese Srl
\u201cBfeng\u201d branch
\u201cNonantola\u201d
branch
Total business
combinations
Non-current assets
Tangible assets
0.1
5.7
7.5
13.3
Rights of use
0.3
1.7
2.0
Intangible assets
34.4
10.1
12.0
56.5
Shareholdings
0.1
0.1
Financial assets
0.1
0.1
Deferred tax assets
0.4
0.2
0.6
Current assets
Inventory and work in progress
0.1
0.1
Commercial receivables
0.3
7.3
6.0
13.6
Financial assets
2.2
2.2
Current tax assets
0.1
0.1
Other current assets
0.2
0.4
1.6
2.2
Cash holdings
4.2
0.2
4.4
Non-current liabilities
Financial liabilities
(1.5)
(4.4)
(5.9)
Lease liabilities
(0.3)
(1.1)
(1.4)
Post-employment
(0.1)
(0.4)
(0.5)
Provisions for risks and charges
(0.1)
(0.1)
Deferred tax liabilities
(9.9)
(3.4)
(13,.3)
Current liabilities
Financial liabilities
(1.9)
(1.9)
Lease liabilities
(0.5)
(0.5)
Commercial payables
(0.1)
(5.9)
(2.8)
(8.8)
Current tax liabilities
(0.1)
(0.2)
(0.3)
Other current liabilities
(0.1)
(3.0)
(1.0)
(0.1)
(4.2)
Total net assets acquired
0.4
30.0
12.9
12.0
3.0
58.3
Equivalent fair value
1.4
30.0
11.1
12.0
54.5
Minority shareholders\u2019 put option
6.0
3.0
9.0
Total value of the combination
1.4
30.0
17.1
12.0
3.0
63.5
02.02.10
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 204|
(Goodwill) / Profit
(1.0)
\u2010
(4.2)
\u2010
\u2010
(5.2)
The evaluation process resulted in the following adjustments to the carrying amounts recorded in the
financial statement of the acquired entity, as well as the following considerations in relation to the amount
transferred:
Alibardi
Fiorenzo Srl
Con Energia
Spa
Macero
Maceratese Srl
\u201cBfeng\u201d branch
\u201cNonantola\u201d
branch
Total business
combinations
Book value of net assets
acquired
0.4
6.7
5.7
12.0
3.0
27.8
Adjustments for fair value
valuation
Tangible assets
0.6
0.6
Intangible assets
34.3
10.0
44.3
Commercial receivables
(1.5)
(1.5)
Deferred tax assets (liabilities)
(9.5)
(3.4)
(12.9)
Fair value of net assets acquired
0.4
30.0
12.9
12.0
3.0
58.3
Cash outlay
1.4
30.0
10.0
12.0
53.4
Deferred/contingent consideration
1.1
1.1
Equivalent fair value
1.4
30.0
11.1
12.0
-
54.5
The managements\u2019 evaluation of the fair value of the identifiable assets acquired and liabilities incurred,
which also considered the recoverable value of the assets, led to the following amendments being
identified:
\u25aa Con Energia Srl \u2013 a customer list of 34.3 million euro was recorded, with an estimated useful life of
15 years calculated on the basis of the estimated churn rate of the acquired customers. In addition,
the allowance for bad debts was adjusted by 1.5 million euro to adjust the commercial receivables
acquired to their recoverable value based on the valuation methods used by the Hera Group.
\u25aa Macero Maceratese Srl \u2013 customer list of 10 million euro was recorded, established on the basis of
both the characteristics of the reference context and using the incremental cash flow method (Meem).
The depreciation period, equal to 18 years, was determined on the basis of the churn rate established
by analysing the historical series of the turnover of the major clients. Additionally, an increase in the
value of the building owned by the company for 0.6 million euro was recorded;
The effects reported above resulted, where applicable, in the recognition of deferred tax liabilities
determined on the basis of the applicable nominal tax rate.
With reference to the acquisition of Macero Maceratese Srl, it should be noted that a cross option to buy
and sell the outstanding shareholding was negotiated with the counterparty, while in the acquisition of
the \u201cNonantola\u201d branch a put option that benefits the counterparty was negotiated. The existence of such
rights held by the minority shareholders led to the need to classify the options in the consolidated financial
statements under financial liabilities, as illustrated in Note 19 \u201cFinancial liabilities\u201d. In accordance with its
own accounting policies, the Group did not include the minority shares in the consolidated financial
statements, considering the shareholding to be fully owned. The valuation of the options identified at the
time of acquisition, therefore, totalled 9 million euro.
In relation to the acquisition of the Bfeng business unit \u2013 a right of use, in force until 2043, was recognised
in the financial statements of the purchaser Hera Spa concerning the operation, ordinary and
extraordinary maintenance of an electro-thermofrigorific power plant located in the municipality of
Bologna, amounting to 12 million euro.
Please see note 28 \u201cCashflows from investing activities\u201d for an analysis of the cash flows associated with
the combination operations described above.
Adjustments
for fair value
valuation
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 205|
Changes to the accounting standards
Accounting standards, amendments and interpretations applicable from 1 January 2022
Beginning 1 January 2022, the following accounting standards and associated amendments as issued
by the IASB and endorsed by the European Union apply:
Amendments to IFRS 3 \u2013 Reference to the Conceptual Framework. Document issued by IASB on 14
May 2020, applicable from 1 January 2022 with early application allowed. The amendments require
entities to refer to the Conceptual Framework published in March 2018 and not the one in force when
IFRS3 was introduced. It also introduces an exception to the use of the Conceptual Framework for certain
types of liabilities, requiring to refer to IAS 37 when applying IFRS 3. Without this exception, an entity
might recognise liabilities in gaining control of a business that it would not otherwise recognise, and
immediately after the acquisition it would have to derecognise those liabilities by recording income that
has no economic substance.
Amendments to IAS 16 \u2013 Selling items produced while bringing an asset into the location and condition
for its intended use. Document issued by IASB on 14 May 2020, applicable from 1 January 2022 with
early application allowed. This amendment prohibits deducting from the cost of an item of property, plant
and equipment any proceeds from selling items produced before that asset is in the location and
condition necessary for it to be capable of operating in the manner intended by management. The entity
must recognise the proceeds from selling such items, and the cost of producing those items, in profit or
loss for the period.
Amendments to IAS 37 \u2013 Onerous Contracts: cost of fulfilling a contract. Document issued by IASB on
14 May 2020, applicable from 1 January 2022 with early application allowed. The changes specify that
the cost of fulfilling a contract must comprise all the costs that relate directly to the contract. Accordingly,
the valuation includes not only incremental costs (such as the cost of material used in the processing),
but also all costs that the company cannot avoid because it entered into the contract (such as the share
of personnel costs and depreciation of machinery used to fulfil the contract).
On 14 May 2020 the IASB published the document \u201cImprovements to the International Financial
Reporting Standard: 2018-2020 Cycle\u201d. These improvements include amendments to existing
international accounting standards, including:
\u25aa IFRS 1 - First adoption of International Financial Reporting Standards. The improvement allows a
subsidiary to measure cumulative exchange differences for all foreign currency transactions using
the amounts that were recognised in the consolidated financial statements, based on the parent
company\u2019s date of first adoption;
\u25aa IFRS 9 - Financial Instruments. It specifies that the only fees to be taken into account for the purposes
of the 10% test for derecognising a financial liability are those exchanged between the entity and the
lender;
\u25aa IFRS 16 - Leases. The improvement revises the illustrative example number 13, excluding the
reimbursement of costs incurred to improve third-party assets, in order not to cause confusion on
how to apply incentives on contracts.
With reference to the application of these amendments, there were no observable effects on the Group\u2019s
financial statements.
Accounting standards, amendments and interpretations endorsed by the European Union
which are not yet applicable and have not been adopted early by the Group.
With reference to the areas that are significant for the Group, the following accounting standard
amendments will be mandatory from the following financial year onwards, having also already been
endorsed by the EU:
Amendments to IAS 1 - Disclosure of financial statements and accounting policies. Document issued
by IASB on 12 February 2021, applicable from 1 January 2023 with early application allowed. The
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 206|
amendments require entities to disclose their material accounting policies rather than their significant
accounting policies and provide guidance to explain the application of the materiality process.
Amendments to IAS 8 - Accounting Policies, Changes in Accounting Estimates and Errors. Document
issued by IASB on 12 February 2021, applicable from 1 January 2023 with early application allowed. The
amendments additionally clarify that companies should distinguish between changes to accounting
policies and changes to accounting estimates.
Amendments to IAS 12 - Deferred taxes related to assets and liabilities arising from a single transaction.
Document issued by IASB on 7 May 2021, applicable from 1 January 2023 with early application allowed.
The amendments clarify how companies should account for deferred tax on transactions such as leases
and contracts with decommissioning obligations that may generate assets and liabilities of equal
amounts, for which the exemption for reporting deferred taxation does not apply when assets and
liabilities are recognised for the first time. The amendments aim at reducing the differences in deferred
tax reporting between different types of contracts.
These amendments clarify, correct or remove redundant statements or formulations in the text of the
relevant standards.
The directors are currently assessing possible effects deriving from the introduction of these
amendments into the Group\u2019s consolidated financial statement.
Accounting standards, amendments and interpretations that have not yet been endorsed by the
European Union
The following standards, amendments and updates of IFRSs (already approved by IASB) and
interpretations (already approved by IFRS IC) that are relevant for the Group are currently being
endorsed by the relevant bodies of the European Union:
Amendments to IAS 1 - Presentation of financial statements: reporting liabilities as current or non-
current. Document issued by IASB on 23 January 2020 and updated on 15 July 2020, applicable from 1
January 2024 with early application allowed. The amendments clarify the requirements to be considered
in determining whether payables and other liabilities with uncertain settlement date should be classified
as current or non-current in the statement of financial position (including payables that can be settled by
conversion into equity instruments).
Amendments to IFRS 16 - Lease Liabilities in a Sale and Leaseback Transaction. Document issued by
IASB on 2 September 2022, applicable from 1 January 2024 with early application allowed. The
amendments provide that in the valuation of lease liabilities in a sale and leaseback transaction, the
seller-lessee shall determine the lease payments in such a way as not to recognise any amount of gain
or loss related to the right of use retained by the lessee.
Amendments to IAS 1 - Presentation of financial statements: non-current liabilities subject to covenant.
Document issued by IASB on 31 October 2022, applicable from 1 January 2024 with early application
allowed. The amendments aim to improve the information disclosed by an entity when the right to defer
settlement of a liability is subject to compliance with covenants within 12 months after the reporting
period.
With reference to the new amendments described above, the directors are currently evaluating what
possible effects introducing them might have on the Group\u2019s consolidated financial statements.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 207|
Classification of financial assets and liabilities pursuant to IFRS 7
The table below illustrates the composition of the Group\u2019s assets, using the current and non-current
distinction. The fair value of other investments and derivative financial instruments is discussed in Notes
26 and 29, respectively.
31 Dec 22
Hierarchy
fair Value
Fair value to
income statement
Fair value to
statement of
comprehensive
income
Depreciated cost
Total
Non-current financial assets
2
2.0
149.8
151.8
Non-current assets
\u2010
2.0
149.8
151.8
Commercial receivables
3
168.6
3,706.4
3,875.0
Current financial assets
77.7
77.7
Other assets
2
22.6
8.3
657.6
688.5
Current assets
22.6
176.9
4,441.70
4,641.2
31 Dec 21
Hierarchy
fair Value
Fair value to
income statement
Fair value to
statement of
comprehensive
income
Depreciated cost
Total
Non-current financial assets
2
1.9
140.8
142.7
Non-current assets
\u2010
1.9
140.8
142.7
Commercial receivables
3
198.0
2,720.0
2,918.0
Current financial assets
2
29.3
29.3
Other assets
2
26.1
417.4
443.5
Current assets
26.1
198.0
3,166.7
3,390.8
With respect to \u201cNon-current financial assets\u201d reference should be made to Note 18.
With respect to \u201cCurrent assets\u201d reference should be made to Notes 13, 18, 33 and 35.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 208|
The table below illustrates the composition of the Group\u2019s liabilities, using the current and non-current
distinction. Details of the fair value of derivatives are provided instead in Note 29.
31 Dec 22
Hierarchy
fair Value
Fair value to
income statement
Hedged elements
(fair value hedge)
Cost
Depreciated
Total
Non-current financial liabilities
2/3
499.5
144.4
5,046.0
5,689.9
Non-current lease liabilities
55.1
55.1
Non-current liabilities
499.5
144.4
5,101.1
5,745.0
Commercial payables
3,093.1
3,093.1
Current financial liabilities
3
13.9
636.2
650.1
Current lease liabilities
21.3
21.3
Other liabilities
2
33.7
1,703.4
1,737.1
Current liabilities
47.6
\u2010
5,454.0
5,501.6
31 Dec 21
Hierarchy
fair Value
Fair value to
income statement
Hedged elements
(fair value hedge)
Cost
Depreciated
Total
Non-current financial liabilities
2/3
590.8
143.7
2,981.5
3,716.0
Non-current lease liabilities
53.2
53.2
Non-current liabilities
590.8
143.7
3,034.7
3,769.2
Commercial payables
2,356.6
2,356.6
Current financial liabilities
3
1.6
498.1
499.7
Current lease liabilities
43.4
43.4
Other liabilities
2
22.5
1,441.0
1,463.5
Current liabilities
24.1
\u2010
4,339.1
4,363.2
With regard to \u201cNon-current financial liabilities\u201d, the fair value hierarchy for hedged items is Level 2, while for items measured at fair value through profit or
loss it is Level 3.
With respect to \u201cNon-current liabilities\u201d reference is made to Notes 19 and 22.
With respect to \u201cNon-current liabilities\u201d reference is made to Notes 13, 19, 22, 34 and 36.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 209|
Reporting by operational sector
Reporting by operational sectors is based on the approach management uses to monitor the
performance of the Group by homogeneous business areas. The net costs and assests for business
support functions, in keeping with the internal control model, are entirely associated to operational
businesses.
At 31 December 2022, the Hera Group was organized into the following business lines:
\u25aa Gas: includes the costs of distributing and selling methane gas as well as district heating and energy
services;
\u25aa Electricity: includes the costs of producing, distributing and selling electricity;
\u25aa Water Cycle: includes aqueduct, purification and sewage services;
\u25aa Waste management: includes waste collection, treatment, recycling and disposal services;
\u25aa Other services: includes public lighting, telecommunications and other minor services.
The following are assets and liabilities by business line for the 2021 and 2022 financial years:
31 Dec 22
Gas
Electricity
Water cycle
Waste management
Other services
Total
Current year
Assets (tangible and intangible)
2,038.8
655.4
2,320.2
1,348.5
123.1
6,486.0
Goodwill
493.5
73.5
42.7
233.5
4.9
848.1
Shareholdings
99.6
29.8
18.7
42.2
\u2010
190.3
Not attributed fixed assets
24.7
Net fixed assets
2,631.9
758.7
2,381.6
1,624.2
128.0
7,549.1
Attributed net working capital
804.8
80.3
(247.8)
59.3
2.9
699.5
Non attributed net working capital
303.5
Net working capital
804.8
80.3
(247.8)
59.3
2.9
1,003.0
Other provisions
(191.4)
(35.8)
(148.1)
(278.5)
(3.8)
(657.6)
Net invested capital
3,245.3
803.2
1,985.7
1,405.0
127.1
7,894.5
31 Dec 21
Gas
Electricity
Water cycle
Waste management
Other services
Total
Previous year
Assets (tangible and intangible)
1,943.3
647.6
2,134.2
1,315.4
128.8
6,169.3
Goodwill
494.8
72.2
42.7
228.3
4.9
842.9
Shareholdings
111.7
30.4
18.9
37.5
\u2010
198.5
Not attributed fixed assets
97.3
Net fixed assets
2,549.8
750.2
2,195.8
1,581.2
133.7
7,308.0
Attributed net working capital
(95.5)
108.1
(155.4)
66.8
(7.9)
(83.9)
Non attributed net working capital
87.4
Net working capital
(95.5)
108.1
(155.4)
66.8
(7.9)
3.5
Other provisions
(181.1)
(33.4)
(129.4)
(285.2)
(4.3)
(633.4)
Net invested capital
2,273.2
824.9
1,911.0
1,362.8
121.5
6,678.1
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 210|
The following are the main result measures by business line for the 2021 and 2022 financial years:
2022
Gas
Electricity
Water cycle
Waste
management
Other
services
Structure
Total
Current financial period
Direct revenues
13,282.8
4,720.7
996.5
1,272.1
145.4
51.5
20,630.2
Infra-cycle revenues
181.9
316.3
4.5
34.9
50.1
63.0
723.7
Total direct revenues
13,464.7
5,037.1
915.8
1,00.9
195.5
114.5
21,354.0
Indirect revenues
18.9
5.7
48.9
51.7
0.7
(114.5)
\u2010
Total revenues
13,483.6
5,047.2
964.7
1,052.6
196.2
\u2010
21,354.0
EBITDA
491.1
71.6
262.4
261.9
38.4
\u2010
1,200.9
Direct amortisations and provisions
205.5
87.7
121.2
125.6
22.2
76.9
667.1
Indirect amortisations and
provisions
8.8
3.1
35.4
34.5
0.5
(76.9)
\u2010
Total amortisations and
provisions
214.3
90.8
156.5
160.1
22.6
\u2010
667.1
Operating revenues
276.8
(19.2)
105.9
101.8
15.7
\u2010
533.8
2021
Gas
Electricity
Water cycle
Waste
management
Other
services
Structure
Total
Previous financial period
Direct revenues
5,833.6
2,784.2
911.1
1,272.1
125.9
28.5
10,955.4
Infra-cycle revenues
109.0
233.1
4.7
34.9
44.2
76.1
502.1
Total direct revenues
5,942.7
3,017.2
915.8
1,307.0
170.2
104.7
11,457.5
Indirect revenues
26.3
7.4
48.9
21.4
0.6
(104.7)
\u2010
Total revenues
5,969.0
3,024.6
964.7
1,328.4
170.8
\u2010
11,457.5
EBITDA
487.6
144.7
262.4
291.7
37.4
\u2010
1,223.9
Direct amortisations and provisions
173.8
69.7
121.2
152.0
20.4
75.0
612.1
Indirect amortisations and
provisions
8.0
3.0
35.4
28.1
0.5
(75.0)
\u2010
Total amortisations and
provisions
181.9
72.7
156.5
180.2
20.9
\u2010
612.1
Operating revenues
305.8
72.0
105.9
111.6
16.4
\u2010
611.7
As extensively described in the Directors\u2019 Report, the EBITDA of the gas operating segment was adjusted
for management purposes to comment on its performance for the period. The value containing the
adjustment on gas inventory valuation is shown in chapter 1.07, \"Analysis by Business Area;\" please
refer to this section for its understanding of business dynamics.
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 211| FINANCIAL STATEMENT FORMATS AS PER CONSOB RESOLUTION 15519/2006 In accordance with the relevant Group policies, the economic, equity and financial reports in effect at 31 December 2022 and the associated period of comparison with related parties are as follows. Procedure for the operations with related parties is available on the website of the Hera Group at the following link: https://www.gruppohera.it/gruppo/governance/sistema-di-governance/politiche-e-procedure It should be noted that during the year 2022, there were no operations with related parties for which it was necessary to include in the financial statements the information required by the regulation adopted on this matter through CONSOB Resolution no. 17221 of 12 March 2010 and following amendments and integrations. 2.03
| Introduction | Directors\u2019 report | Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 212|
Income statement as per Consob resolution 15519/ 2006
notes
2022
of which related parties
2021
of which related parties
A
B
C
D
Total
%
A
B
C
D
Total
%
Revenues
1
20,082.0
\u2010
129.1
315.6
23.6
468.3
2.3%
10,555.3
\u2010
58.0
319.4
13.1
390.5
3.7%
Other operating revenues
2
548.2
\u2010
0.3
3.2
\u2010
3.5
0.6%
400.1
\u2010
0.3
7.1
0.5
7.9
2.0%
Raw materials and materials
3
(16,730.0)
\u2010
(100.2)
\u2010
(45.0)
(145.2)
0.9%
(6,668.5)
\u2010
(104.7)
\u2010
(46.1)
(150.8)
2.3%
Service costs
4
(2,105.8)
\u2010
(11.9)
(23.3)
(33.2)
(68.4)
3.2%
(2,464.6)
\u2010
(8.6)
(19.8)
(33.9)
(62.3)
2.5%
Personnel costs
5
(601.1)
\u2010
\u2010
\u2010
\u2010
\u2010
(592.8)
\u2010
\u2010
\u2010
\u2010
\u2010
Other operating costs
6
(74.9)
\u2010
\u2010
(2.3)
(0.9)
(3.2)
4.3%
(66.5)
\u2010
\u2010
(1.8)
(0.6)
(2.4)
3.6%
Capitalised costs
7
82.5
\u2010
\u2010
\u2010
\u2010
\u2010
60.8
\u2010
\u2010
\u2010
\u2010
\u2010
Amortisation, provisions and depreciation
8
(667.1)
\u2010
\u2010
\u2010
\u2010
\u2010
(612.1)
\u2010
(4.0)
\u2010
\u2010
(4.0)
0.7%
Operating revenues
533.8
\u2010
17.3
293.2
(55.5)
255.0
611.7
\u2010
(59.0)
304.9
(67.0)
178.9
Share of profits (losses) pertaining to joint ventures and associated
companies
9
10.0
\u2010
10.0
\u2010
\u2010
10.0
100.0%
13.2
\u2010
13.2
\u2010
\u2010
13.2
100.0%
Financial income
10
82.2
\u2010
1.6
0.6
0.4
2.6
3.2%
82.3
\u2010
4.8
0.7
0.4
5.9
7.2%
Financial expenses
11
(217.2)
\u2010
\u2010
(0.3)
\u2010
(0.3)
0.1%
(300.3)
\u2010
(2.4)
(0.3)
\u2010
(2.7)
0.9%
Financial operations
(125.0)
\u2010
11.6
0.3
0.4
12.3
(204.8)
\u2010
15.6
0.4
0.4
16.4
Earnings before taxes
408.8
\u2010
28.9
293.5
(55.1)
267.3
406.9
\u2010
(43.4)
305.3
(66.6)
195.3
Taxes
12
(103.5)
\u2010
-
\u2010
\u2010
-
(34.2)
\u2010
\u2010
\u2010
\u2010
\u2010
Net profit for the year
305.3
\u2010
28.9
293.5
(55.1)
267.3
372.7
\u2010
(43.4)
305.3
(66.6)
195.3
Attributable to:
Parent company shareholders
255.2
333.5
Minority shareholders
50.1
39.2
Earnings per share
basic
17
0.175
0.228
diluted
17
0.175
0.228
Column headings related parties: A non-consolidated subsidiaries, B Associated and jointly controlled companies, C Related companies with significant influence (shareholder municipalities), D Other related parties
2.03.01
| Introduction | Directors\u2019 report | Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 213|
Statement of financial position as per Consob resolution 15519/ 2006
notes
31 Dec 22
of which related parties
31 Dec 21
of which related parties
A
B
C
D
Total
%
A
B
C
D
Total
%
ASSETS
Non-current assets
Tangible assets
21.25
1,984.4
\u2010
\u2010
\u2010
\u2010
\u2010
1,941.0
\u2010
\u2010
\u2010
\u2010
\u2010
Rights of use
22.25
84.2
\u2010
\u2010
\u2010
\u2010
\u2010
101.6
\u2010
\u2010
\u2010
\u2010
\u2010
Intangible assets
23.25
4,417.4
\u2010
\u2010
\u2010
\u2010
\u2010
4,126.7
\u2010
\u2010
\u2010
\u2010
\u2010
Goodwill
24.25
848.1
\u2010
\u2010
\u2010
\u2010
\u2010
842.9
\u2010
\u2010
\u2010
\u2010
\u2010
Shareholdings
26.27
190.3
\u2010
156.3
\u2010
2.0
158.3
83.2%
198.5
\u2010
152.4
\u2010
2.0
154.4
77.8%
Non-current financial assets
18
151.8
\u2010
14.3
12.1
25.3
51.7
34.1%
142.7
\u2010
18.6
13.6
29.8
62.0
43.4%
Deferred tax assets
14
240.4
\u2010
\u2010
\u2010
\u2010
\u2010
229.4
\u2010
\u2010
\u2010
\u2010
\u2010
Derivative financial instruments
29
1.0
\u2010
\u2010
\u2010
\u2010
\u2010
6.9
\u2010
\u2010
\u2010
\u2010
\u2010
Total non-current assets
7,917.6
\u2010
170.6
12.1
27.3
210.0
7,589.7
\u2010
171.0
13.6
31.8
216.4
Current assets
Inventories
32
995.1
\u2010
\u2010
\u2010
\u2010
\u2010
368.0
\u2010
\u2010
\u2010
\u2010
\u2010
Commercial receivables
33
3,875.0
\u2010
24.9
85.3
24.8
135.0
3.5%
2,918.0
\u2010
10.3
65.6
15.0
90.9
3.1%
Current financial assets
18
77.7
\u2010
9.2
3.7
1.4
14.3
18.4%
29.3
\u2010
4.8
4.4
3.2
12.4
42.3%
Current tax assets
13
46.0
\u2010
\u2010
\u2010
\u2010
\u2010
21.2
\u2010
\u2010
\u2010
\u2010
\u2010
Other current assets
35
642.5
\u2010
2.9
(2.3)
3.9
4.5
0.7%
422.3
\u2010
2.4
(1.2)
3.9
5.1
1.2%
Derivative financial instruments
29
1,622.2
\u2010
\u2010
\u2010
\u2010
\u2010
1,797.4
\u2010
\u2010
\u2010
\u2010
\u2010
Cash and cash equivalents
18
1,942.4
\u2010
\u2010
\u2010
\u2010
\u2010
885.6
\u2010
\u2010
\u2010
\u2010
\u2010
Total current assets
9,200.9
\u2010
37.0
86.7
30.1
153.8
6,441.8
\u2010
17.5
68.8
22.1
108.4
TOTAL ASSETS
17,118.5
\u2010
207.6
98.8
57.4
363.8
14,031.5
\u2010
188.5
82.4
53.9
324.8
Column headings related parties: A non-consolidated subsidiaries, B Associated and jointly controlled companies, C Related companies with significant influence (shareholder municipalities), D Other related parties
2.03.02
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 214| notes 31 Dec 22 of which related parties 31 Dec 21 of which related parties A B C D Total % A B C D Total % NET EQUITY AND LIABILITIES Share capital and reserves Share capital 15 1,450.3 \u2010 \u2010 \u2010 \u2010 \u2010 1,459.6 \u2010 \u2010 \u2010 \u2010 \u2010 Reserves 15 1,692.9 \u2010 \u2010 \u2010 \u2010 \u2010 1,407.1 \u2010 \u2010 \u2010 \u2010 \u2010 Profit (loss) for the period 15 255.2 \u2010 \u2010 \u2010 \u2010 \u2010 333.5 \u2010 \u2010 \u2010 \u2010 \u2010 Group net equity 3,398.4 \u2010 \u2010 \u2010 \u2010 \u2010 3,200.2 \u2010 \u2010 \u2010 \u2010 \u2010 Non-controlling interests 16 246.3 \u2010 \u2010 \u2010 \u2010 \u2010 216.6 \u2010 \u2010 \u2010 \u2010 \u2010 Total net equity 3,644.7 \u2010 \u2010 \u2010 \u2010 \u2010 3,416.8 \u2010 \u2010 \u2010 \u2010 \u2010 Non-current liabilities Non-current financial liabilities 19 5,689.9 \u2010 \u2010 1.5 \u2010 1.5 0.0% 3,716.0 \u2010 \u2010 1.8 \u2010 1.8 0.0% Non-current lease liabilities 22 55.1 \u2010 \u2010 3.7 0.3 4.0 7.3% 53.2 \u2010 0.1 4.6 0.2 4.9 9.2% Post-employment and other benefits 30 92.0 \u2010 \u2010 \u2010 \u2010 \u2010 105.4 \u2010 \u2010 \u2010 \u2010 \u2010 Provisions for risks and charges 31 565.6 \u2010 3.8 \u2010 \u2010 3.8 0.7% 528.0 \u2010 1.5 \u2010 \u2010 1.5 0.3% Deferred tax liabilities 14 215.7 \u2010 \u2010 \u2010 \u2010 \u2010 132.1 \u2010 \u2010 \u2010 \u2010 \u2010 Derivative financial instruments 29 6.3 \u2010 \u2010 \u2010 \u2010 \u2010 13.5 \u2010 \u2010 \u2010 \u2010 \u2010 Total non-current liabilities 6,624.6 \u2010 3.8 5.2 0.3 9.3 4,548.2 \u2010 1.6 6.4 0.2 8.2 Current liabilities Current financial liabilities 19 650.1 \u2010 5.2 0.5 \u2010 5.7 0.9% 499.7 \u2010 \u2010 0.7 39.4 40.1 8.0% Current lease liabilities 22 21.3 \u2010 - 1.4 0.1 1.5 7.2% 43.4 \u2010 - 1.2 0.1 1.3 3.1% Commercial payables 34 3,093.1 \u2010 33.8 22.8 33.3 89.9 2.9% 2,356.6 \u2010 31.8 16.7 24.6 73.1 3.1% Current tax liabilities 13 17.1 \u2010 \u2010 \u2010 \u2010 \u2010 27.9 \u2010 \u2010 \u2010 \u2010 \u2010 Other current liabilities 36 1,720.0 \u2010 1.5 6.5 0.1 8.1 0.5% 1,435.6 \u2010 4.8 4.8 0.4 10.0 0.7% Derivative financial instruments 29 1,347.6 \u2010 \u2010 \u2010 \u2010 \u2010 1,703.3 \u2010 \u2010 \u2010 \u2010 \u2010 Total current liabilities 6,849.2 \u2010 40.5 31.2 33.5 105.2 6,066.5 \u2010 36.6 23.4 64.5 124.5 TOTAL LIABILITIES 13,473.8 \u2010 44.3 36.4 33.8 114.5 10,614.7 \u2010 38.2 29.8 64.7 132.7 TOTAL NET EQUITY AND LIABILITIES 17,118.5 \u2010 44.3 36.4 33.8 114.5 14,031.5 \u2010 38.2 29.8 64.7 132.7 Column headings related parties: A non-consolidated subsidiaries, B Associated and jointly controlled companies, C Related companies with significant influence (shareholder municipalities), D Other related parties | Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 215| Cash flow statement as per Consob resolution 15519/2006 31 Dec 22 of which related parties Earnings before taxes 408.8 Adjustments to reconcile net profit to the cashflow from operating activities Amortisation and impairment of assets 478.6 Allocation to provisions 188.5 Effects from valuation using the net equity method (10.0) Financial (income) expenses 135.0 (Capital gains) losses and other non-monetary elements 41.6 Change in provision for risks and charges (27.8) Change in provision for employee and post-employment benefits (12.7) Total cash flow before changes in net working capital 1,202.0 (Increase) decrease in inventories (627.4) (Increase) decrease in commercial receivables (1,280.7) (44.1) Increase (decrease) in commercial payables 727.8 16.8 Increase/decrease in other current assets/liabilities 252.7 (1.3) Changes in working capital (927.6) Dividends collected 13.4 9.5 Interest income and other financial income collected 41.8 2.6 Interest expenses, net charges on derivatives and other paid financial charges (128.0) (0.3) Taxes paid (165.9) Cash flow from operating activities (a) 35.7 Investments in tangible assets (225.6) Investments in intangible assets (483.9) Investments in subsidiary companies and business units net of cash holdings (50.1) Other equity investments (3.2) (3.2) Sale price of tangible and intangible assets 3.3 0.1 Divestments of shareholdings and contingent consideration \u2010 (Increase) decrease in other investment activities 1.1 10.8 Cash flow from (for) investing activities (b) (758.4) New issue of long-term bonds 2,127.0 Repayments of non-current financial liabilities \u2010 Repayments and other net changes in financial liabilities (47.3) (34.7) Repayment of lease liabilities (43.4) (1.0) Acquisition of Interests in consolidated companies (10.6) Dividends paid out to Hera shareholders and non-controlling interests (219.5) (68.1) Changes in treasury share (26.7) Cash flow from (for) financing activities (c) 1,779.5 Increase (decrease) in cash holdings (a+b+c) 1,056.8 Cash and cash equivalents at the beginning of the period 885.6 Cash and cash equivalents at the end of the period 1,942.4 2.03.03 | Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 216| Net financial debt according to the Consob notice DEM/6064293 of 2006 31 Dec 22 31 Dec 21 A B C D A B C D A Cash holdings 1,942.4 \u2010 \u2010 \u2010 \u2010 885.6 \u2010 \u2010 \u2010 \u2010 B Cash equivalents \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 C Other current financial assets 77.7 \u2010 9.2 3.7 1.4 29.3 \u2010 4.8 4.4 3.2 D Liquidity (A+B+C) 2,020.1 914.9 of which related parties \u2010 9.2 3.7 1.4 \u2010 4.8 4.4 3.2 E Current financial debt (563.0) \u2010 \u2010 (0.5) \u2010 (443.6) \u2010 \u2010 (0.8) (39.4) F Current part of non-current financial debt (108.4) \u2010 (5.2) (1.4) (0.1) (99.5) \u2010 \u2010 (1.2) (0.1) G Current financial indebtedness (E+F) (671.4) (543.1) of which related parties \u2010 (5.2) (1.9) (0.1) \u2010 \u2010 (2.0) (39.5) H Current net financial indebtedness (G+D) 1,348.7 371.8 of which related parties \u2010 (4.0) 1.8 1.3 \u2010 4.8 2.4 (36.3) I Non-current financial debt (2,553.0) \u2010 \u2010 (5.2) (0.3) (1,073.8) \u2010 \u2010 (6.4) (0.2) J Debt instruments (3,197.3) \u2010 \u2010 \u2010 \u2010 (2,702.0) \u2010 \u2010 \u2010 \u2010 K Commercial and other non-current payables \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 L Non-current financial indebtedness (I+J+K) (5,750.3) (3,775.8) of which related parties \u2010 \u2010 (5.2) (0.3) \u2010 \u2010 (6.4) (0.2) M Total financial indebtedness (H+L) ESMA guidelines 32 \u2013 382 \u2013 1138 (4,401.6) (3,404.0) of which related parties \u2010 (4.0) (3.4) 1.0 \u2010 4.8 (4.0) (36.5) Non-current financial receivables 151.8 142.7 of which related parties \u2010 14.3 12.1 25.3 \u2010 18.6 13.6 29.8 Net financial debt (4,249.8) (3,261.3) of which related parties \u2010 18.3 8.7 26.3 \u2010 23.4 9.6 (6.7) 2.03.04
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 217|
List of related parties
The values reported in the table at 31 December 2022 refer to the related parties listed below:
Group A - Non-consolidated subsidiaries
Group B- Affiliated and jointly controlled companies
Adria Link Srl
Aimag Spa
ASM SET Srl
Aurora Srl
Energo Doo
Enomondo Srl
Hea Spa
H.E.P.T. Co. Ltd
Natura Srl in liquidation
Oikothen Scarl in liquidation
SEA - Servizi Ecologici Ambientali Srl
Set Spa
Sgr Servizi Spa
Sinergie Italiane Srl in liquidation
Tamarete Energia Srl
Tre Monti Srl
Group C - Related parties with signficant influence
Municipality of Bologna
Municipality of Casalecchio di Reno
Municipality of Cesena
Municipality of Ferrara
Municipality of Imola
Municipality of Modena
Municipality of Padua
Municipality of Ravenna
Municipality of Rimini
Municipality of Trieste
CON.AMI
Holding Ferrara Servizi Spa
Ravenna Holding Spa
Rimini Holding Spa
Group D - Other related parties
Acosea Impianti Srl
Dragone Impianti Spa Acqeduct
Aloe Spa
Amir Spa - Asset
Apa2 consulting Sas
Aspes Spa
BPI Learning Consulting Spain SL
Calenia Energia Spa
CIR S.p.A.
Co.ra.b. Srl
2.03.05
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 218|
Cora costr. Resid. Artig. Srl
Dental invest Srl
Executive Advocacy Srl
Fiorano Gestioni Patrimoniali Srl
Fonderia cab Srl
Fonderia fomar ghisa Srl
Formigine Patrimonio Srl
Ire immobiliare riqualificazione ed
Maranello Patrimonio Srl
Medeopart 2 Srl
Medeopart 3 Srl
Medeopart 4 Srl
Medeopart 5 Srl
Medeopart 6 Srl
Medeopart associates Srl
Medeor Capital S.r.l.
Rabofin Srl
Romagna Acque Spa
Sassuolo Gestioni Patrimoniali Srl
Se.r.a. Srl catering service
Serramazzoni Patrimonio Srl
Sis Societ\u00e0 Intercomunale di Servizi Spa in liquidation
Societ\u00e0 Italiana Servizi Spa - Sis Spa asset
SOGEFI S.p.A.
SPS S.r.l.
Te.Am Srl
Team Srl
Unica Reti Spa - Asset
Vanpart Srl
Auditors, directors, strategic executives, family members of strategic executives
Explanatory notes to relations with related parties
Service management
In most of the areas it serves competence and in almost all of shareholding municipalities for the
provinces of Modena, Bologna, Ferrara, Forl\u00ec-Cesena, Ravenna, Rimini, Padua, Udine, Trieste, Gorizia
and Pesaro, the Hera Group holds the concession for the local public services of economic interest
(distribution of natural gas through local gas pipelines, integrated water service and environmental
services, including sweeping, waste collection, transport, recovery and disposal). The electricity
distribution service is carried out in the areas of Modena and Imola, and in the municipalities of Trieste
and Gorizia. Other public utilities (including urban district heating, energy services and public lighting)
are carried out in a free market regime or through specific agreements with the local authorities
concerned. Through specific relations with the local authorities and/or local agencies, the Hera Group is
also responsible for waste treatment and disposal services, not included in urban hygiene activities.
Water sector
The water services managed by the Hera Group are carried out in the areas served in the Emilia-
Romagna, Veneto, Friuli-Venezia Giulia and Marche regions. It is carried out on the basis of conventions
with the relevant local agencies, with a variable duration, which is usually twenty years.
The Hera Group\u2019s mandate for managing integrated water services refers to activities of water collection
and drinking water treatment and distribution for civil and industrial applications as well as sewerage and
sewage treatment. The agreements signed with the local area authorities also require the operator to
carry out the planning and construction of new networks and plants aimed at providing the service. The
2.03.06
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 219|
conventions regulate the economic aspects of the contractual agreement, as well as the modes of
managing the service, and the performance and quality standards.
Beginning in 2012, authority for rates was transferred to the national agency ARERA which, as part of
this task it has been assigned, approved a transitional rate method for the period 2012-2013, a two-year
period of consolidation from 2014 to 2015, an additional rate method in force for 2016-2019 and the
current provision regime 2020-2023.
The adjustment for 2020-2023 is in continuity with the 2016-2019 period with the introduction of a number
of new elements aimed at encouraging energy and environmental sustainability actions as well as
contract and technical quality. Each operator is granted revenue (VRG) independently of the trends of
the volumes distributed and it is established on the basis of operating costs (efficient and exogenous)
and capital costs in relation to the investments made, as well as for the Rimini area, the outcome of the
tender procedure that led to the new concession contract signed for the period 2022 -2039.
For the purpose of carrying out the service, the operator uses networks, facilities and other equipment
owned by the company itself, municipalities and Asset companies. These assets, part of the inaccessible
water stores, or granted or leased to the provider, must be returned to the municipalities, Asset
companies or local area authorities at the end of the concession to be made available to the incoming
provider. Any work carried out by the Hera Group for the water service must be returned to the above
mentioned entities following payment or the residual value of the assets in question.
Hera\u2019s relations with users are regulated by provisioning regulations as well as Service Charters drafted
on the basis of templates approved by local area authorities in compliance with provisions set out by
ARERA regarding the quality of the service and the resource.
Waste management sector
The municipal waste service managed by the Hera Group in the area it serves is provided on the basis
of agreements with local authorities and comprises the exclusive management of the collection,
transportation, sweeping and cleaning of streets, preparations for waste recovery or disposal and other
minor services. The agreements entered into with the relevant local authorities regulate the economic
aspects of the contractual agreement, as well as the modes of organising and managing the service, and
the performance and quality standards. Beginning in 2020, the considerations due to the operator for
the services rendered, including municipal waste disposal/treatment/recovery activities, have been
defined annually on the basis of the ARERA new national rate regulation (Authority resolution 2019/433),
as well as on the basis of the consideration resulting from competitive procedures already concluded, for
the areas of new awarding of contracts (the areas of Ravenna and Cesena, Bologna, Modena, and
Saccolongo).
The municipal waste management service is billed by the Hera Group to the individual municipalities in
the case of the Tari regime or to the individual users in the case of the application of the punctual
correspondent tariff.
To run treatment plants for municipal waste, the Hera Group is required to obtain provincial
authorizations; furthermore, for 2022, the subsidiary Herambiente Spa as well is required to comply with
the new national regulation with regard to unsorted waste disposal plants and composting and digester
plants, as they are classified as \u201cminimum plants\u201d by the regions and are crucial for the closure of the
municipal waste management cycle, without prejudice to the outcome of pending administrative litigation
proceedings In particular, these judgments concern, with two different appeals, the qualification of so-
called minimum plants made by the competent Regions with regard to organic waste treatment plants
and disposal plants.
In compliance with the principle of continuity of public services, under the terms of the existing
agreements, the operator is obliged to continue the service also in the territories where the expiry date
of the entrustment has already passed and until new entrustments take effect.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 220|
Energy sector
The duration of licenses for the distribution of natural gas via local gas pipelines, initially set for periods
ranging between ten and thirty years by the original agreements stipulated with the municipalities, was
revised by Italian decree 164/2000 (so-called Letta Decree, transposing Directive 98/30/EC) and by
subsequent reforms of the energy market. Inrete Distribution Energy Spa, an Hera Group company that
took over natural gas and electricity distribution from Hera Spa, takes advantage of longer residual terms
established for operators that have promoted partial privatizations and mergers. The duration of
distribution concessions is unchanged with respect to that foreseen in the company\u2019s stock exchange
listing. The agreements associated with the distribution licenses regarding the distribution of natural gas
or other similar gases for heating, domestic, handicraft and industry uses, and for other general uses.
Rates for the distribution of gas are fixed under current regulations and by periodical resolutions issued
by the agency in charge of this sector (Arera).
The area in which Inrete Distribuzione Energia Spa provides gas distribution services is divided into rate
zones in which a uniform distribution rate is applied to different categories of customers. The tariff
regulations in force at the time these annual financial statements were approved are ARERA resolution
620/2021/R/gas of 29 December 2021 (Update of tariffs for gas distribution and metering services, for
the year 2022), which replaced the 596/2020/R/gas of 29 December 2020 and which serve to approve
the mandatory tariffs for natural gas distribution, metering and marketing services for 2022.
The tariff rates valid as from 1 January 2022 are shown in Table 1 attached to the aforementioned
resolution. The tariffs for the 2022 financial year are part of the so-called 2020-2025 tariff period.
Beginning 1 January 2020, in fact, the new Regulation governing gas distribution and metering service
rates for the regulation period 2020-2025 (Rtdg 2020-2025) came into force, approved with resolution
570/2019/R/gas.
Pursuant to Article 43 of the Rtdg 2020-2025, the mandatory natural gas distribution and metering tariffs
are broken down into different rate areas:
\u25aa the northwest area, which includes the regions of Valle d\u2019Aosta, Piedmont and Liguria;
\u25aa the northeast area, including the regions of Lombardy, Trentino - Alto Adige, Veneto, Friuli - Venezia
Giulia, and Emilia - Romagna;
\u25aa the central area, comprising the regions of Tuscany, Umbria and the Marche;
\u25aa the central-south-eastern area, including the regions of Abruzzo, Molise, Apulia and Basilicata;
\u25aa the central-southwestern area, including the Lazio and Campania regions;
\u25aa the southern area, including the regions of Calabria and Sicily;
\u25aa the Sardinia area, including the region of Sardinia.
The value of the tariff components GS, RE, RS and UG1 referred to in paragraph 42.3, sections c), d),
e), f) of the Rtdg 2020-2025 is subject to quarterly updating.
Beginning 1 January 2022, for the first six months the values of the last three months of 2021 were
confirmed - Resolution 635/2021/R/com and Table t attached to Resolution 396/2021/R/com and
beginning 1 April 2022 - Resolution 141/2022/R/com and Table 7 attached to Resolution
396/2021/R/com.
For the second half of the year beginning 1 June 2022 with Resolution 295/2022/R/com, the regulatory
authority again confirmed the values in Table 7 attached to Resolution 396/2021/R/com, reconfirming
them again beginning 1 October 2022 with Resolution 462/2022/R/com.
Beginning 1 October 2021 the values are those of Table 7 attached to Resolution 396/2021/R/com.
With regard to electricity, the contracts (lasting thirty years and renewable pursuant to the current
regulations) govern power distribution activities comprising, inter alia, the management of distribution
networks and the operation of associated plants, ordinary and extraordinary maintenance, the planning
and identification of development projects, and metering. The contract may be suspended or terminated,
on the judgement of the national Authority, if defaults and violations occur on the part of the
concessionary company that seriously affect the performance of the distribution and metering of
electricity. The distribution company is obliged to apply to its customers (so called Distribution Users) the
rates set by current regulations and resolutions adopted by the sector Authority. The rate regulations in
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 221|
effect at the time the annual financial statements were approved is that of the Authority\u2019s resolution
654/2015/R/Eel of 23 December 2015 (Rate regulations for electricity transmission, distribution and
metering, for the regulatory period 2016-2023), which replaced the previous Authority resolution Arg/elt
no. 199/2011 and subsequent amendments and additions (Official directives for the provision of
electricity transmission, distribution and metering services for the regulatory period 2012-2015 and
provisions on economic conditions for the provision of connection services), in force until 31 December
2015. With this resolution, the Authority issued the provisions on the tariff regulation of electricity
transmission, distribution and measurement services for the 2016-2023 regulatory period, defining an
eight-year regulatory period made up of two four-year semi-periods, also providing for an intra-period
update between the first and second semi-periods.
The mandatory rate for distribution services covers the costs of transporting electricity along distribution
networks. It is applied to all end customers, with the exception of low-voltage household customers. The
rate has a trinomial structure and is expressed in hundredths of a euro per sampling point per year (fixed
component), euro cents per KW per year (power component) and euro cents per kWh consumed (energy
component).
The compulsory tariff for the distribution service is periodically updated by the national authority Arera by
means of an appropriate provision, therefore, on 27 December 2019, resolution 568/2019/R/Eel was
issued, approving the tariff regulation of electricity transmission, distribution and measurement services
for the 2020-2023 regulatory semi-period.
For household customers for the year 2022, the update of tariffs for the delivery of electricity
transmission, distribution and metering services has been established by Resolution 623/2021/R/eel of
28 December 2021.
For non-household customers, the tariff update for 2022 for the distribution and metering services as well
as the economic conditions for the provision of the connection service was established by Resolution
623/2021/R/eel of 28 December 2021.
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 222|
SHAREHOLDINGS
List of consolidated companies
Subsidiaries
Registered name
Registered office
Share capital
(euro) (*)
Consolidated percentage
Total interest
direct
indirect
Acantho Spa
Imola (BO)
23,573,079
80.64%
80.64%
AcegasApsAmga Spa
Trieste
284,677,324
100.00%
100.00%
AcegasApsAmga Servizi Energetici Spa
Udine
11,168,284
100.00%
100.00%
Alibardi Fiorenzo Srl
Quinto di Treviso (TV)
100,000
100.00%
100.00%
Aliplast Spa
Istrana (TV)
5,000,000
75.00%
75.00%
Aliplast France Recyclage Sas
La Wantzenau (France)
1,025,000
75.00%
75.00%
Aliplast Iberia SL
Calle Castilla -Leon (Spain)
815,000
75.00%
75.00%
Aliplast Polska Spoo
Zgierz (Poland)
1,200,000 PLN
75.00%
75.00%
Aresenergy Eood
Varna (Bulgaria)
50,000 Lev
100.00%
100.00%
AresGas Ead
Sofia (Bulgaria)
22,572,241 Lev
100.00%
100.00%
Ares Trading Eood
Varna (Bulgaria)
50,000 Lev
100.00%
100.00%
Asa Scpa
Castelmaggiore (BO)
1,820,000
38.25%
38.25%
Atlas Utilities Ead
Varna (Bulgaria)
50,000 Lev
100.00%
100.00%
Biorg Srl
Bologna
10,000,000
75.00%
75.00%
Black Sea Gas Company Eood
Varna (Bulgaria)
5,000 Lev
100.00%
100.00%
Con Energia Spa
Forl\u00ec (FC)
500,000
100.00%
100.00%
Eco Gas Srl
Castel di Sangro (AQ)
100,000
100.00%
100.00%
EstEnergy Spa
Trieste
299,925,761
100.00%
100.00%
Etra Energia Srl
Cittadella (PD)
100,000
51.00%
51.00%
Feronia Srl
Finale Emilia (MO)
100,000
75.00%
75.00%
Frullo Energia Ambiente Srl
Bologna
17,139,100
38.25%
38.25%
Green Factory Srl
Pesaro
500,000
46.70%
46.70%
Herambiente Spa
Bologna
271,648,000
75.00%
75.00%
Herambiente Servizi Industriali Srl
Bologna
5,000,000
75.00%
75.00%
Hera Comm Spa
Imola (BO)
53,595,899
100.00%
100.00%
Hera Comm Marche Srl
Urbino (PU)
1,977,332
100.00%
100.00%
Hera Luce Srl
Cesena
1,000,000
100.00%
100.00%
Hera Servizi Energia Srl
Forl\u00ec
1,110,430
67.61%
67.61%
Heratech Srl
Bologna
2,000,000
100.00%
100.00%
Hera Trading Srl
Trieste
22,600,000
100.00%
100.00%
HestAmbiente Srl
Trieste
1,010,000
82.50%
82.50%
Hydro Mud Srl
Torrebelvicino (VI)
50,000
75.00%
75.00%
Inrete Distribuzione Energia Spa
Bologna
10,091,815
100.00%
100.00%
Macero Maceratese Srl
Macerata (MC)
1,032,912
46.70%
46.70%
Marche Multiservizi Spa
Pesaro
16,388,535
46.70%
46.70%
2.04
2.04.01
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 223|
Marche Multiservizi Falconara Srl
Falconara Marittima (AN)
100,000
46.70%
46.70%
Primagas AD
Varna (Bulgaria)
1,149,860 Lev
97.34%
97.34%
Recycla Spa
Maniago (PN)
90,000
75.00%
75.00%
Tri-Generazione Scarl
Padua
100,000
70.00%
70.00%
Uniflotte Srl
Bologna
2,254,177
97.00%
97.00%
Vallortigara Servizi Ambientali Spa
Torrebelvicino (VI)
330,000
75.00%
75.00%
Vallortigara Angelo Srl
Torrebelvicino (VI)
80,000
75.00%
75.00%
Wolmann Spa
Bologna
400,000
100.00%
100.00%
(*) unless otherwise specified
Jointly controlled entities
Registered name
Registered office
Share capital (\u20ac)
Percentage held
Total interest
direct
indirect
Enomondo Srl
Faenza (RA)
14,000,000
37.50%
37.50%
Associated companies
Registered name
Registered office
Share capital
(euro) (*)
Percentage held
Total interest
direct
indirect
Aimag Spa*
Mirandola (MO)
78,027,681
25.00%
25.00%
ASM Servizi Energetici e Tecnologici-ASM
SET Srl
Rovigo
200,000
49.00%
49.00%
SEA - Servizi Ecologici Ambientali Srl
Camerata Picena (AN)
100,000
31.00%
31.00%
Set Spa
Milan
120,000
39.00%
39.00%
Sgr Servizi Spa
Rimini
5,982,262
29.61%
29.61%
Tamarete Energia Srl
Ortona (CH)
3,600,000
40.00%
40.00%
*The share capital of these companies consists of 67,577,681 euro of ordinary shares and 10,450,000 euro of related shares.
Key figures in the financial statements of subsidiaries and associated
companies
Summary of key figures of the financial statements of subsidiaries pursuant to Article 2429, last
paragraph, of the Civil Code.
thous. \u20ac
Acantho Spa
AcegasApsAmga
SpA*
AcegasApsAmga
Servizi Energetici
Spa*
Alibardi Fiorenzo
Srl
Aliplast Spa
ASSETS
Fixed assets
61,049
1,052,237
90,648
79
62,232
Circulating assets
34,335
166,743
258,843
649
85,456
Total assets
95,384
1,218,980
349,491
728
147,688
LIABILITIES
Share capital
23,573
284,677
11,168
95
5,000
Reserves
10,579
273,331
31,809
301
27,190
Net profit /(loss)
5,883
21,955
16,281
75
35,226
Provisions
36
29,263
2,100
\u2010
1,128
Severance pay provision
637
11,013
1,033
1
673
2.04.02
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 224|
Payables
54,676
598,741
287,100
256
78,471
Total liabilities
95,384
1,218,980
349,491
728
147,688
INCOME STATEMENT
Production value
79,266
383,534
204,958
621
214,174
Production costs
(70,029)
(347,760)
(188,771)
(516)
(168,825)
Financial income/ (expenses)
(591)
(7,608)
4,260
\u2010
(1,415)
Extraordinary income/ (expenses)
\u2010
\u2010
\u2010
\u2010
\u2010
Taxes for the year
(2,763)
(6,211)
(4,166)
(30)
(8,708)
Net profit /(loss)
5,883
21,955
16,281
75
35,226
thous. \u20ac
Aliplast France
Recyclage Sarl
Aliplast Iberia Sl
Aliplast Polska SP
O.O
AresGas Ead
Aresenergy Eood
ASSETS
Fixed assets
3,423
640
372
83,448
10
Circulating assets
2,792
1,256
1,368
7,250
584
Total assets
6,215
1,896
1,740
90,698
594
LIABILITIES
Share capital
1,025
815
256
11,541
26
Reserves
527
84
623
16,861
(215)
Net profit /(loss)
432
92
230
1,215
63
Provisions
\u2010
\u2010
\u2010
26
\u2010
Severance pay provision
\u2010
\u2010
\u2010
25
\u2010
Payables
4,231
905
631
61,030
720
Total liabilities
6,215
1,896
1,740
90,698
594
INCOME STATEMENT
Production value
7,871
2,557
6,010
68,302
2,101
Production costs
(7,424)
(2,460)
(5,724)
(65,744)
(2,023)
Financial income/ (expenses)
(15)
\u2010
5
(1,167)
(15)
Extraordinary income/ (expenses)
\u2010
26
\u2010
\u2010
\u2010
Taxes for the year
\u2010
(31)
(61)
(176)
\u2010
Net profit /(loss)
432
92
230
1,215
63
thous. \u20ac
Con Energia Spa
Eco Gas Srl
EstEnergy Spa*
Etra Energia Srl*
Feronia Srl
ASSETS
Fixed assets
196
125
515,002
87
2,746
Circulating assets
19,671
9,708
631,806
5,421
2,884
Total assets
19,867
9,833
1,146,808
5,508
5,630
LIABILITIES
Share capital
500
100
299,926
100
100
Reserves
6,272
1,880
259,501
1,071
1,160
Net profit /(loss)
699
695
21,376
506
(498)
Provisions
4
\u2010
4,997
\u2010
4,141
Severance pay provision
140
104
2,185
66
\u2010
Payables
12,253
7,054
558,823
3,765
727
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 225|
Total liabilities
19,867
9,833
1,146,808
5,508
5,630
INCOME STATEMENT
Production value
28,361
17,358
1,414,473
15,831
316
Production costs
(27,435)
(16,416)
(1,387,711)
(15,128)
(996)
Financial income/ (expenses)
44
55
1,390
9
\u2010
Extraordinary income/ (expenses)
\u2010
\u2010
\u2010
\u2010
\u2010
Taxes for the year
(271)
(302)
(6,776)
(206)
182
Net profit /(loss)
699
695
21,376
506
(498)
thous. \u20ac
Frullo Energia
Ambiente Srl*
Green Factory Srl
Hera Comm Marche
Srl*
Hera Comm Spa*
Hera Luce Srl*
ASSETS
Fixed assets
49,574
3,797
21,501
721,542
113,631
Circulating assets
32,864
662
62,402
2,132,308
68,624
Total assets
82,438
4,458
83,903
2,853,850
182,255
LIABILITIES
Share capital
17,139
500
1,977
53,596
1,000
Reserves
26,248
(39)
13,165
389,687
54,264
Net profit /(loss)
17,040
(16)
962
30,268
6,723
Provisions
2,625
\u2010
\u2010
7,139
105
Severance pay provision
1,442
\u2010
653
3,493
625
Payables
17,943
4,014
67,146
2,369,668
119,538
Total liabilities
82,438
4,458
83,903
2,853,850
182,255
INCOME STATEMENT
Production value
48,359
\u2010
164,802
7,179,599
108,786
Production costs
(24,972)
(16)
(160,213)
(7,186,957)
(102,284)
Financial income/ (expenses)
(103)
\u2010
104
40,215
2,292
Extraordinary income/ (expenses)
\u2010
\u2010
\u2010
\u2010
\u2010
Taxes for the year
(6,243)
\u2010
(3,732)
(2,590)
(2,071)
Net profit /(loss)
17,040
(16)
962
30,268
6,723
thous. \u20ac
Hera Servizi
Energia Srl
Hera Trading Srl*
Herambiente
Servizi
Industriali Srl*
Herambiente Spa*
Heratech Srl*
ASSETS
Fixed assets
75,770
2,794
142,316
1,040,138
156
Circulating assets
489,248
4,187,303
64,178
373,642
67,945
Total assets
565,019
4,190,097
206,494
1,413,781
68,101
LIABILITIES
Share capital
1,110
22,600
5,000
271,600
1,981
Reserves
19,854
201,950
20,174
80,570
4,964
Net profit /(loss)
29,330
1,533
5,366
34,048
3,576
Provisions
12,791
\u2010
5,410
164,293
44
Severance pay provision
860
603
2,629
6,509
5,090
Payables
501,074
3,963,411
167,915
856,761
52,44 6
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 226|
Total liabilities
565,019
4,190,097
206,494
1,413,781
68,101
INCOME STATEMENT
Production value
455,369
16,454,417
164,890
497,454
180,591
Production costs
(403,636)
(16,448,731)
(164,283)
(449,635)
(175,029)
Financial income/ (expenses)
(10,641)
(3,910)
1,019
(5,907)
\u2010
Extraordinary income/ (expenses)
-
\u2010
\u2010
\u2010
(452)
Taxes for the year
(11,763)
(242)
3,740
(7,863)
(1,535)
Net profit /(loss)
29,330
1,533
5,366
34,048
3,576
thous. \u20ac
HestAmbiente Srl*
Hydro Mud Srl
Inrete Distribuzione
Energia Spa*
Macero Maceratese
Srl
Marche Multiservizi
Spa
ASSETS
Fixed assets
101,234
48
1,313,364
6,082
253,277
Circulating assets
24,076
782
198,821
8,021
79,192
Total assets
125,310
830
1,512,185
14,103
332,469
LIABILITIES
Share capital
1,010
50
9,901
1,033
16,389
Reserves
18,547
406
564,318
4,850
106,183
Net profit /(loss)
10,317
230
37,516
965
15,319
Provisions
5,887
\u2010
128,219
183
38,360
Severance pay provision
589
12
7,969
485
5,364
Payables
88,960
132
764,262
6,587
150,855
Total liabilities
125,310
830
1,512,185
14,103
332,469
INCOME STATEMENT
Production value
80,293
764
364,333
16,994
145,797
Production costs
(64,383)
(448)
(298,140)
(15,370)
(124,639)
Financial income/ (expenses)
(1,835)
\u2010
7
(75)
(392)
Extraordinary income/ (expenses)
\u2010
\u2010
(15,639)
(157)
\u2010
Taxes for the year
(3,758)
(85)
(13,046)
(426)
(5,447)
Net profit /(loss)
10,317
230
37,516
965
15,319
thous. \u20ac
Marche Multiservizi
Falconara Srl
Primagas AD
Recycla Spa
Tri-Generazione
Srl*
Uniflotte Srl*
ASSETS
Fixed assets
2,703
2,301
13,160
\u2010
121,384
Circulating assets
2,596
1,195
11,310
862
30,536
Total assets
5,300
3,496
24,470
862
151,920
LIABILITIES
Share capital
100
588
90
100
2,254
Reserves
561
340
6,514
289
27,885
Net profit /(loss)
274
460
3,903
\u2010
3,896
Provisions
236
\u2010
636
\u2010
\u2010
Severance pay provision
883
\u2010
1,045
\u2010
1,562
Payables
3,246
2,108
12,282
473
116,323
Total liabilities
5,300
3,496
24,470
862
151,920
| Introduction
| Directors\u2019 report
| Consolidated financial statements
Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 227|
INCOME STATEMENT
Production value
8,212
6,370
24,032
1,173
99,947
Production costs
(7,811)
(5,837)
(18,792)
(990)
(93,226)
Financial income/ (expenses)
(7)
(28)
(64)
(174)
(2,292)
Extraordinary income/ (expenses)
\u2010
\u2010
\u2010
\u2010
\u2010
Taxes for the year
(120)
(45)
(1,273)
(9)
(533)
Net profit /(loss)
274
460
3,903
\u2010
3,896
thous. \u20ac
Vallortigara Angelo Srl
Vallortigara Servizi
Ambientali Spa
Wolmann Spa
ASSETS
Fixed assets
879
10,668
308
Circulating assets
4,202
11,690
18,591
Total assets
5,081
22,358
18,899
LIABILITIES
Share capital
80
330
400
Reserves
3,095
9,481
(663)
Net profit /(loss)
380
2,242
1,354
Provisions
8
195
46
Severance pay provision
360
506
109
Payables
1,159
9,602
17,653
Total liabilities
5,081
22,358
18,899
INCOME STATEMENT
Production value
6,048
26,758
21,342
Production costs
(5,656)
(24,227)
(19,263)
Financial income/ (expenses)
17
477
(255)
Extraordinary income/ (expenses)
\u2010
\u2010
(46)
Taxes for the year
(28)
(765)
(424)
Net profit /(loss)
380
2,242
1,354
*The company applies the international accounting standards, therefore the values stated comply with them.
Summary of key figures of the financial statements of joint ventures pursuant to Article 2429, last
paragraph, of the Civil Code.
thous. \u20ac
Enomondo Srl
ASSETS
Fixed assets
39,678
Circulating assets
23,392
Total assets
63,070
LIABILITIES
Share capital
14,000
Reserves
23,546
Net profit /(loss)
4,679
Provisions
1,167
Severance pay provision
19
| Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 228| Payables 19,659 Total liabilities 63,070 INCOME STATEMENT Production value 32,319 Production costs (25,728) Financial income/ (expenses) (125) Extraordinary income/ (expenses) Taxes for the year (1,787) Net profit /(loss) 4,679 Summary of key figures of the financial statements of associated companies pursuant to Article 2429, last paragraph, of the Civil code. thous. \u20ac Aimag Spa ASM SET Srl SEA - Servizi Ecologici Ambientali Srl Set Spa Sgr Servizi Spa Tamarete Energia Srl ASSETS Fixed assets 380,984 65 13,040 109,031 1,483 51,506 Circulating assets 224,238 12,063 12,749 109,105 131,180 15,300 Total assets 605,222 12,128 25,789 218,136 132,663 66,806 LIABILITIES \u2010 Share capital 78,028 200 100 120 5,982 3,600 Reserves 136,649 69 10,275 72,917 43,455 1,972 Net profit /(loss) 17,286 2,982 4,590 (1,532) 8,992 21 Provisions 32,423 1,723 143 3,760 Severance pay provision 3,588 263 499 301 1,587 Payables 337,248 8,614 8,602 146,330 72,504 57,453 Total liabilities 605,222 12,128 25,789 218,136 132,663 66,806 INCOME STATEMENT \u2010 Production value 423,482 54,500 19,564 284,545 312,852 40,711 Production costs (398,465) (50,320) (12,915) (285,070) (301,094) (38,340) Financial income/ (expenses) (1,397) 2 (90) (759) 801 (2,183) Extraordinary income/ (expenses) 427 (1,004) Taxes for the year (6,761) (1,200) (1,969) 756 (3,567) (167) Net profit /(loss) 17,286 2,982 4,590 (1,532) 8,992 21 | Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 229| INFORMATION REQUIRED BY LAW 124 OF 4 AUGUST 2017 ART. 1 PARAGRAPHS 125-129 AND FOLLOWING AMENDMENTS Law 124/2017, Art. 1, paragraphs 125-129 and following amendments established that companies must disclose in the explanatory notes to the financial statements the \u201csubsidies, grants, benefits, contributions or aid, in cash or in kind, without consideration, remuneration or compensation\u201d received from the Public Administration, above the threshold of 10,000 euro and on a cash basis. The following table shows the cases present within the Group: Operating grants Issuing entity Description Amount received (euro) Authorithy for water and waste services - Friuli-Venezia Giulia region Regional funds - purification plant of Servola, municipality of Trieste 2,110,926 Emilia Romagna Region Covid emergency and sorted waste collection in the municipality of Bologna 991,937 Atersir Ambit Fund lines LFA and LFB1 year 2022 605,420 Emilia Romagna Region Interventions on vegetation to secure facility areas 300,000 Presidency of the Council of Ministers - Family Policy Department Project Conciliamo - AcceleHERAzioni: inclusion, smart working and welfare 278,276 CNR-Institute of Photonics and Nanotechnologies Initiatives to develop innovative sensors for gas network monitoring 92,500 Bi-Rex Smart Sustainable Community 70,135 Municipality of Padua Regular maintenance in the Padua commercial area 43,721 Municipality of Ravenna Waste reduction public establishments in the municipality of Ravenna 19,200 Plant investment grants Issuing entity Description Amount received (euro) Meeting of the Optimal Territory Environment Area n. 1 North Marche Water and sewerage network interventions in the locality of Cionara and Rio Salso 741,573 Emilia Romagna Region Remediation and upgrading of water and sewerage networks 692,768 Emilia Romagna Region Measures to restore gas networks 662,338 Ministry of the Environment and Energy Security PNRR project: Masterplan Friuli-Venezia Giulia aqueducts 181,884 Municipality of Pesaro Water and sewerage network interventions in the locality of Schieti (Urbino) 130,000 A.U.S.I.R. Authority for water and waste services Maintenance work on the Zaule Lampade UV purifier of Zaule (TS) 108,500 Acosea Impianti Srl Upgrading of water and sewerage networks 94,223 Bi-Rex Smart Sustainable Community project 83,523 Municipality of Urbino Water and sewerage network interventions in the locality of Mirafiore and Parco 25 Aprile 15,000 Guarantees from Public Entities Issuing body Description Amount received (euro) Sace Spa Guarantee on Unicredit loan 450,000,000 2.05 | Introduction | Directors\u2019 report | Consolidated financial statements Hera Group \u2013 Consolidated Financial Statements at 31 December 2022 230| OUTLINE OF ARTICLE149 DUODECIES OF THE CONSOB ISSUER\u2019S REGULATION thous. \u20ac 2022 Services provided to certify the financial statements 1,068 Provision of other services for the issue of an attestation by the independent auditor company 365 Provision of other services by the independent auditor 86 Total 1,519 2.06", "dimensions": { "concept": "ifrs-full:DisclosureOfNotesAndOtherExplanatoryInformationExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-421": { "value": "Introduction Hera S.p.A. is a joint-stock company established in Italy, listed on the Milan Stock Exchange and with registered office in Bologna, Viale Berti Pichat 2/4. Hera Spa and its subsidiaries (the Hera Group) operate mainly in Italy in the waste management (waste management and treatment), water (aqueduct, sewerage and purification) and energy (distribution and sale of electricity, gas and energy services) sectors; it also offers services for public lighting and telecommunications. The consolidated financial statement at 31 December 2022 was prepared in compliance with Regulation (EC) No. 1606/2002 of 19 July 2002, observing the International Accounting Financial Reporting Standards (IFRSs) issued by the International Accounting Standard Board (IASB) and endorsed by the European Commission, as well as the provisions enacted in implementing Article 9 of Italian Legislative Decree no. 38/2005. IFRSs also include the International Accounting Standards (IAS) currently in force, the interpretative documents issued by the International Financial Reporting Standards Interpretation Committee (IFRSIC) and the previous Standing Interpretation Committee (SIC). The directors considered the applicability of the assumed going concern in drafting the consolidated financial statement, and decided that such assumption is appropriate in that there are no doubts about the going concern. This assessment took into account the current context provoked by the conflict between Russia and Ukraine. Sufficient obligatory information to present a true and fair view of the Group\u2019s capital-financial conditions as well as its economic performance. Information on the Group\u2019s activities and on significant events after year end is provided in the Directors\u2019 report, in paragraph 1.03 \u201cMain significant events\u201d. The general principle adopted in preparing these consolidated financial statements is the cost principle, except for the financial assets and liabilities (including the derivative instruments), which were measured at fair value. In drawing up the consolidated financial statements, management was required to use estimates; the major areas characterised by valuations and assumptions of particular significance together with those having notable effects on the situations accounted for here are provided in the paragraph \u201cSignificant estimates and valuations\u201d at the end of this section. These consolidated financial statements at 31 December 2022 were drawn up by the Board of Directors and approved by the same at the meeting held on 21 March 2023. These financial statements were audited by Deloitte & Touche Spa. Financial statement content and format These consolidated financial statements comprise: \u25aa primary reporting formats; they are the same as those used for the consolidated financial statements for the year ended 31 December 2021 and have the following features: \u2013 the income statement includes individual items analysed by type. We believe that this type of presentation, which is also used by our major competitors and is in line with international practice, best represents company results; \u2013 the statement of comprehensive income is presented in a separate document and distinguishing items that may and may not be reclassified subsequently to profit and loss. \u2013 the statement of changes in net equity reports separately the other items of the comprehensive income statement; \u2013 the statement of financial position makes the distinction between current and non-current assets and liabilities. \u2013 the cash-flow statement has been prepared using the indirect method; \u25aa explanatory notes; compared with 31 December 2021, the explanatory notes have been reorganized by aggregating them by topic covered, in order to make the information presented more effective and organized. In any case, direct references to the financial statement formats have been retained.
2.02.01
In the financial statements any non-recurring costs and revenues are indicated separately. Moreover, with reference to Consob resolution 15519 of 27 July 2006 on financial statements, specific supplementary formats of income statement, statement of financial position and cash flow statement have been included, highlighting the most significant balances with related parties, in order to avoid altering the overall clarity of the financial statements. The financial statement formats and the information included in the explanatory notes are expressed in millions of euro with a decimal point, unless otherwise indicated.", "dimensions": { "concept": "ifrs-full:DisclosureOfGeneralInformationAboutFinancialStatementsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-1": { "value": "Hera S.p.A.", "dimensions": { "concept": "ifrs-full:NameOfParentEntity", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-2": { "value": "joint-stock company", "dimensions": { "concept": "ifrs-full:LegalFormOfEntity", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-3": { "value": "Italy", "dimensions": { "concept": "ifrs-full:DomicileOfEntity", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-4": { "value": "Bologna", "dimensions": { "concept": "ifrs-full:PrincipalPlaceOfBusiness", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-5": { "value": "Viale Berti Pichat 2/4", "dimensions": { "concept": "ifrs-full:AddressOfRegisteredOfficeOfEntity", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-6": { "value": "Hera Spa ", "dimensions": { "concept": "ifrs-full:NameOfUltimateParentOfGroup", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-7": { "value": "Hera Group", "dimensions": { "concept": "ifrs-full:NameOfReportingEntityOrOtherMeansOfIdentification", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-408": { "value": "operate mainly in Italy in the waste management (waste management and treatment), water (aqueduct, sewerage and purification) and energy (distribution and sale of electricity, gas and energy services) sectors; it also offers services for public lighting and telecommunications.", "dimensions": { "concept": "ifrs-full:DescriptionOfNatureOfEntitysOperationsAndPrincipalActivities", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-8": { "value": "Italy", "dimensions": { "concept": "ifrs-full:CountryOfIncorporation", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-9": { "value": "The consolidated financial statement at 31 December 2022 was prepared in compliance with Regulation (EC) No. 1606/2002 of 19 July 2002, observing the International Accounting Financial Reporting Standards (IFRSs) issued by the International Accounting Standard Board (IASB) and endorsed by the European Commission, as well as the provisions enacted in implementing Article 9 of Italian Legislative Decree no. 38/2005. IFRSs also include the International Accounting Standards (IAS) currently in force, the interpretative documents issued by the International Financial Reporting Standards Interpretation Committee (IFRSIC) and the previous Standing Interpretation Committee (SIC). ", "dimensions": { "concept": "ifrs-full:StatementOfIFRSCompliance", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-10": { "value": "The directors considered the applicability of the assumed going concern in drafting the consolidated financial statement, and decided that such assumption is appropriate in that there are no doubts about the going concern. This assessment took into account the current context provoked by the conflict between Russia and Ukraine.", "dimensions": { "concept": "ifrs-full:DisclosureOfGoingConcernExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-494": { "value": "Information on the Group\u2019s activities and on significant events after year end is provided in the Directors\u2019 report, in paragraph 1.03 \u201cMain significant events\u201d. ", "dimensions": { "concept": "ifrs-full:DisclosureOfEventsAfterReportingPeriodExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-11": { "value": "The general principle adopted in preparing these consolidated financial statements is the cost principle, except for the financial assets and liabilities (including the derivative instruments), which were measured at fair value. In drawing up the consolidated financial statements, management was required to use estimates; the major areas characterised by valuations and assumptions of particular significance together with those having notable effects on the situations accounted for here are provided in the paragraph \u201cSignificant estimates and valuations\u201d at the end of this section.", "dimensions": { "concept": "ifrs-full:DisclosureOfBasisOfPreparationOfFinancialStatementsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-12": { "value": "These consolidated financial statements at 31 December 2022 were drawn up by the Board of Directors and approved by the same at the meeting held on 21 March 2023. These financial statements were audited by Deloitte & Touche Spa.", "dimensions": { "concept": "ifrs-full:DisclosureOfAuthorisationOfFinancialStatementsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-495": { "value": "Scope of consolidation The consolidated financial statements at 31 December 2022 include the financial statements of the Parent Company Hera S.p.A. and those of its subsidiaries. Control is obtained when the Parent Company has the power to determine the financial and operational policies of a company, by way of currently valid rights, in such a way as to obtain benefits from the company\u2019s activity. Equity investments in joint ventures in which the Hera Group exercises joint control with other companies as well as the companies over which the Group exercises significant control are consolidated with the equity method. Small-scale subsidiaries and associated companies are excluded from overall consolidation and valued at fair value. These companies are reported in note 26, item \u201cOther shareholdings\u201d. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForSubsidiariesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-422": { "value": "Scope of consolidation The consolidated financial statements at 31 December 2022 include the financial statements of the Parent Company Hera S.p.A. and those of its subsidiaries. Control is obtained when the Parent Company has the power to determine the financial and operational policies of a company, by way of currently valid rights, in such a way as to obtain benefits from the company\u2019s activity. Equity investments in joint ventures in which the Hera Group exercises joint control with other companies as well as the companies over which the Group exercises significant control are consolidated with the equity method. Small-scale subsidiaries and associated companies are excluded from overall consolidation and valued at fair value. These companies are reported in note 26, item \u201cOther shareholdings\u201d. Changes in the scope of consolidation The table below shows changes in the scope of consolidation introduced during the 2022 financial year as compared to the consolidated financial statements at 31 December 2021: Acquisition of control Company/business unit Alibardi Fiorenzo Srl Con Energia Spa Macero Maceratese Srl \u201cBfeng\u201d business unit \u201cNonantola\u201d business unit Exited the scope Company/business unit Vegri Scarl in liquidation For an overview of the control acquisition transactions carried out during the period, see Section 1.03 \u201cMain Events Occurred\u201d of the Directors\u2019 Report and the \"Business Combinations (supplementary information)\" section of Section 2.2.10 \"Other Information\" for accounting considerations and the valuation details of assets and liabilities acquired. On 12 July 2022, the shareholder\u2019s meeting of Vegri Scarl authorised the act of early dissolution of the company. The liquidation process was completed in the month of November and the company was removed from the applicable commercial register. Changes in equity investments On 16 December 2021, the shareholder\u2019s meeting of Feronia Srl authorised, pursuant to Article 2482-ter of the Italian civil code, the coverage of the losses for the financial period, as well as the reconstitution of the share capital in the amount of 100,000 euro by means of cash injections. Following the failure of the minority shareholder to exercise the capital increase option, Herambiente Spa, on 31 January 2022, also took on the latter\u2019s share, becoming the sole shareholder of Feronia Srl. On 12 January 2022, Atlas Utilities EAD purchased from a minority shareholder 500 ordinary shares of Primagas AD, equal to 0.43% of the share capital. The percentage of participation in the latter increased from 96.9% to 97.34%. On 18 January 2022, the parent company Hera Comm Spa acquired a minority stake of 16% in Hera Comm Marche Srl, thereby becoming the sole shareholder. The difference between the adjustment of these minority shareholdings and the fair value of the equivalent amount paid was reported directly in net equity and attributed to the parent company\u2019s shareholders. Other corporate operations On 7 February 2022, the shareholder TEA Spa sold its stake in Sinergie Italiane Srl in liquidation to the remaining shareholders on a pro rata basis, leaving the company. As a result of this transaction, EstEnergy Spa changed its shareholding from 31% to 32.56%. On 14 June 2022, the plan to merge Ascopiave Energie Spa, Ascotrade Spa and Blue Meta Spa into the parent company EstEnergy Spa and Amgas Blu Srl into the parent company Hera Comm Spa was approved. The merger took place on 1 October 2022, with accounting effects backdated to 1 January 2022. On 1 December 2022, with effect from 23 December 2022, Ascopiave Spa transferred to Hera Comm Spa a stake in EstEnergy Spa equal to 8% of the share capital, following the partial exercise of the put option it held. As a result of this transaction, Hera Comm Spa increased its stake in EstEnergy Spa from 52% to 60%, but with no effect on minority interests, since the Group\u2019s policy is to not expose minority interests when there is a put option, since the related financial debt for the purchase of these is already exposed. Accounting policies and consolidation principles The financial statements used for the preparation of the consolidated statement of financial position and income statement schedules were those which the companies included within the scope of consolidation reclassified and adjusted (on the basis of specific instructions issued by the Parent Company) for the purposes of consistency with the accounting standards and principles of the Group. In processing the values referred to the companies valued at net equity, adjustments to their respective financial statements were considered in order to adapt them to IFRS standards, in case these companies do not adopt them. When drawing up the consolidated statement of financial position and income statement schedules, the assets and liabilities as well as the income and expenses of the companies included in the scope of consolidation are included on a line-by-line basis. However, the receivables and payables, income and expenses, gains and losses resulting from operations carried out between companies included in the scope of consolidation have been eliminated. The book value of the equity investments is eliminated against the corresponding portion of investees\u2019 shareholders\u2019 equity. On first-time consolidation, the positive difference between the book value of the equity investments and the fair value of the assets and liabilities acquired, was allocated to the asset and liability items and on a residual basis to goodwill. The negative difference was immediately recorded in the income statement, as illustrated in the following section \u201cBusiness combinations\u201d. The total of capital and reserves of subsidiaries pertaining to non-controlling interests is recorded within equity in the line item \u201cNon-controlling interests\u201d. The portion of the consolidated result relating to non- controlling interests is recorded in the account \u201cMinority shareholders\u201d. The valuation of the financial statement items has been carried out on the basis of the general criteria of prudence and on an accrual basis, with a view of the business as a going concern. For the purposes o the accounting entries, priority is given to the economic substance of the transactions rather than their legal form. In preparing these consolidated financial statements, the accounting policies and principles were the same as those adopted in the previous year, considering the new accounting standards reported in the section \u201cChanges to accounting standards\u201d of section 2.02.10 \u201cOther information.\u201d As far as the income statement is concerned, the costs and revenues stated include those recorded at year-end, which have a balancing entry in the statement of financial position. In this regard, income is included only if realised by said year-end date, while account has been taken of the risks and losses even if known after said date. The transactions with minority shareholders are recognised as equity transactions. Therefore, for purchases of additional shares after control is attained, the difference between the cost of acquisition and the book value of the shares purchased from non-controlling interests is recognized in Group net equity. The functional and presentation currency adopted by the Group is the euro. The assets and liabilities of foreign companies denominated in currencies other than the euro which are included in the scope of consolidation are translated using the exchange rates prevailing on the balance sheet date. Income and expenses are translated at the average exchange rate for the year. Exchange rate differences are included in a reserve until the relevant foreign operation is sold. The main exchange rates used to convert the value of the investees outside the Euro zone are as follows: 2022 31 Dec 22 2021 31 Dec 21 Average Specific Average Specific Bulgarian Lev 1.9558 1.9558 1.9558 1.9558 Polish Zloty 4.6861 4.6808 4.5650 4.5970", "dimensions": { "concept": "ifrs-full:DisclosureOfBasisOfConsolidationExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-13": { "value": "The transactions with minority shareholders are recognised as equity transactions. Therefore, for purchases of additional shares after control is attained, the difference between the cost of acquisition and the book value of the shares purchased from non-controlling interests is recognized in Group net equity. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForTransactionsWithNoncontrollingInterestsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-14": { "value": "The functional and presentation currency adopted by the Group is the euro. The assets and liabilities of foreign companies denominated in currencies other than the euro which are included in the scope of consolidation are translated using the exchange rates prevailing on the balance sheet date. Income and expenses are translated at the average exchange rate for the year. Exchange rate differences are included in a reserve until the relevant foreign operation is sold. The main exchange rates used to convert the value of the investees outside the Euro zone are as follows: 2022 31 Dec 22 2021 31 Dec 21 Average Specific Average Specific Bulgarian Lev 1.9558 1.9558 1.9558 1.9558 Polish Zloty 4.6861 4.6808 4.5650 4.5970", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFunctionalCurrencyExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-423": { "value": "Tangible assets - Tangible assets are recorded at cost or production cost, including accessory costs, or at the value based on expert appraisals, if relating to purchased companies, net of the related accumulated depreciation and any impairment. The production cost includes the portion of direct and indirect costs reasonably attributable to the asset (e.g. personnel costs, transport, customs duty, costs for the preparation of the installation location, final test & inspection costs, notary fees, land registry expenses). The cost includes any professional fees and, for certain assets, capitalised financial charges up to the moment the asset enters into service. The cost also comprises the possible costs for dismantling, recovering and reclamation of the site that hosts the item of property, plant and equipment, if it complies with the provisions of IAS 37. Ordinary maintenance costs are charged in full to the income statement. Improvement, upgrading and transformation costs which increase the value of the assets are recorded as assets. The book value of intangible assets is subject to assessment so as to identify any losses in value, particularly when events or changes in circumstances indicate that the book value cannot be recovered (for details, see the section \u201cLosses in value\u201d). Depreciation starts to be applied when the assets enter the production cycle. Tangible assets are classified as in progress when the process of economic use has not yet begun. The property, plant and equipment are systematically depreciated in each accounting period using the depreciation rates considered representative of the remaining useful lives of the assets. The rates of the amortisation for tangible assets are outlined here below: Category rates Buildings 1.8% - 2.8% Distribution plants 1.4% - 5.9% Production plants 2.5% - 25.0% Other plants 3.9% - 7.5% Equipment 5.0% - 20.0% Electronic machines 16.7% - 20.0% Vehicles 10.0% - 20.0% The estimated useful lives of tangible assets are reviewed each year so as to assess the need to revise them. In the event that the estimated useful lives do not provide a truthful representation of the expected future economic benefits, the relative depreciation schedule must be redefined according to the new assumptions. These changes are made prospectively to the income statement. Land is not depreciated, with the exception of land in which landfills are located, which is depreciated based on the quantity of waste disposed of with respect to the total conferrable capacity. Gains and losses on disposal of assets are calculated as the difference between proceeds from the sale and the book value of the relevant investment and are recognized in the income statement as the control of the asset is transferred to the buyer. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForPropertyPlantAndEquipmentExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-441": { "value": "Tangible assets - Tangible assets are recorded at cost or production cost, including accessory costs, or at the value based on expert appraisals, if relating to purchased companies, net of the related accumulated depreciation and any impairment. The production cost includes the portion of direct and indirect costs reasonably attributable to the asset (e.g. personnel costs, transport, customs duty, costs for the preparation of the installation location, final test & inspection costs, notary fees, land registry expenses). The cost includes any professional fees and, for certain assets, capitalised financial charges up to the moment the asset enters into service. The cost also comprises the possible costs for dismantling, recovering and reclamation of the site that hosts the item of property, plant and equipment, if it complies with the provisions of IAS 37. Ordinary maintenance costs are charged in full to the income statement. Improvement, upgrading and transformation costs which increase the value of the assets are recorded as assets. The book value of intangible assets is subject to assessment so as to identify any losses in value, particularly when events or changes in circumstances indicate that the book value cannot be recovered (for details, see the section \u201cLosses in value\u201d). Depreciation starts to be applied when the assets enter the production cycle. Tangible assets are classified as in progress when the process of economic use has not yet begun. The property, plant and equipment are systematically depreciated in each accounting period using the depreciation rates considered representative of the remaining useful lives of the assets. The rates of the amortisation for tangible assets are outlined here below: Category rates Buildings 1.8% - 2.8% Distribution plants 1.4% - 5.9% Production plants 2.5% - 25.0% Other plants 3.9% - 7.5% Equipment 5.0% - 20.0% Electronic machines 16.7% - 20.0% Vehicles 10.0% - 20.0% The estimated useful lives of tangible assets are reviewed each year so as to assess the need to revise them. In the event that the estimated useful lives do not provide a truthful representation of the expected future economic benefits, the relative depreciation schedule must be redefined according to the new assumptions. These changes are made prospectively to the income statement. Land is not depreciated, with the exception of land in which landfills are located, which is depreciated based on the quantity of waste disposed of with respect to the total conferrable capacity. Gains and losses on disposal of assets are calculated as the difference between proceeds from the sale and the book value of the relevant investment and are recognized in the income statement as the control of the asset is transferred to the buyer. Investment property - An item of property is recognized as investment property when it generates cash flows largely independently of the other assets held by the Company, as it is held to earn rentals and/or for capital appreciation or both, not to be utilized in production of for the provision of goods or services or in connection with company operations. As permitted by IAS 40, investment property has been recognized at cost. As such, these assets are reported at cost minus depreciation and any impairment. Rights of use - The right of use of a good or service is initially valued by the Group at cost. This cost includes: (a) the initial value of the lease liability (calculated as outlined in the section \u201cLease liabilities\u201d); (b) payments related to the lease contract made before the effective date; (c) initial direct costs related to property, plant and equipment; (d) an estimate of the costs to be incurred by the lessee in dismantling and restoring the asset. Service components that may be included in the contract are excluded from projections of future lease payments and accounted for separately under operating expenses on a straight-line basis. After the initial recognition, the value of the right of use is reduced by accrued depreciation and impairment and is adjusted for any restatements of the lease liability. If the lease transfers the ownership of the underlying asset at the end of the lease term, the right of use is depreciated beginning from the effective date until the end of the useful life of the underlying asset, otherwise the depreciation is calculated on the basis of the lease duration. The asset consisting of the right of use is subject to an impairment test to identify any loss in value. Intangible assets and goodwill - Intangible assets which are identifiable and can be monitored, and whose cost can be reliably determined based on the assumption that said assets will generate future economic benefits, are recorded in the accounts. These assets are stated at cost in accordance with the policies indicated for property, plant and equipment and, if they have a definite useful life, they are amortised systematically over the period of the estimated useful life. The depreciation begins when the asset is available for use or in any case begins to generate economic benefit for the Group. Work in progress includes costs relating to intangible assets for which the process of economic use has not yet commenced. If the Intangible assets have an indefinite useful life, they are not amortised but rather subjected to an annual impairment test, even in the absence of indicators signalling losses in value. Research costs are recorded in the income statement. Any development costs for new products and/or processes are booked to the income statement in the year they are incurred, unless their use extends over several years. IT applications are representative of assets that are identifiable and capable of generating future economic benefits under the control of the Group. These rights are depreciated over their relevant useful lives. Concessions mainly comprise the rights associated with networks, plants and other facilities related to gas and integrated water cycle services managed by the Group and are instrumental to the management of these services. These concessions were listed as intangible assets even before the IFRIC 12 - Agreements for concession services - interpretation was first applied. The depreciation of the concessions are calculated on the basis of the provisions of the respective conventions, and namely: i) according to a constant rate for the shorter of the following two periods: the useful life of the assets granted in concession and the duration of that same concession, provided that, when this concession expires, the outgoing operator is not granted any compensation value (Residual industrial value, or RIV); ii) according to the useful life of the individual assets if, at the moment the concessions expire, the assets in question are expected to pass into the hands of the operator. Public services under concession include the rights over networks, plants and other facilities related to gas, integrated water cycle, and electricity (with the sole exception of the assets related to the territory of Modena, which are classified among the assets owned by virtue of the associated acquisition) and public lighting services (for the latter, except for what highlighted in the following note describing the accounting principles applied to the \u201cPayables and financing\u201d item) linked to services managed by the Group. These arrangements are accounted for by applying the intangible asset model provided for the IFRIC 12 interpretation, since it was considered that the underlying concession arrangements do not guarantee the existence of an unconditional right in favour of the concessionaire to receive cash or other financial assets. Construction and improvement services carried out on behalf of the grantor are accounted for as contract work in progress. Considering that most works are contracted out externally and that on construction activities carried out internally the job margin cannot be identified individually from the benefits included in the remuneration for the service, these infrastructures are reported on the basis of costs actually incurred, net of any contributions paid by the entities and/or private customers. This category also includes improvements made and infrastructure constructed on the goods instrumental to the management of these services, which are the property of the Holding Companies (so called Asset Companies, pursuant to Art. 113 of Legislative Decree no. 267/00), yet managed by the Group by virtue of business branch leasing contracts. These contracts, in addition to establishing the fees due, also include clauses governing the restitution of assets, normally maintained, upon payment of a balance corresponding to the net book value or the Industrial Residual Value (also taking into account the recovery funds) of these assets. The depreciation of these rights is carried out based on the useful life of the individual assets, also in view of the relevant legislation which, in the event of a change in service provider, calls for compensation to be paid to the outgoing operator in the amount of the Residual Industrial Value (RIV) for assets constructed under their ownership, or at Net Book Value (NBV), for assets manufactured under a business unit leasing contract. The intangible assets acquired following a business combination are recorded separately from goodwill if their fair value can be reliably determined and are depreciated over the useful life estimated in the purchase price allocation. The depreciation begins when the asset is ready for use according to the needs of the corporate management. Gains or losses on disposal of intangible assets are calculated as the difference between proceeds from the sale and the carrying amount of the asset and are recognized in the income statement when the control of the asset is transferred to the buyer. The depreciation rates of intangible assets are outlined here below: Category rates IT applications 20.0% Patents and trademarks 10.0% Buildings under concession 1.8% - 3.5% Distribution plants under concession 1.8% - 10.0% Other plants under concession 2.5% - 12.5% Equipment under concession 12.5% Cost of acquiring new contracts - As required by IFRS 15, incremental costs, represented by commissions paid to agents for the acquisition of new energy supply contracts, are recognized as intangible assets and are amortised according to the average useful life of the acquired customers (churn rate). For this purpose, only the types of commissions related to new customers not present in the Group\u2019s customer base are recognized. Business combinations - Business combination operations are accounted for by applying the acquisition method foreseen by IFRS 3, as a consequence of which the buyer acquires the equity and takes over the assets and liabilities of the acquired company. The cost of the operation is shown as the fair value of the transferred assets, liabilities assumed and equity instruments issued in exchange for the control of the acquired company, as at the date of acquisition. The expenses related to the business combination are generally recognised in the income statement at the time they are incurred. Any positive difference between the cost of the transaction and the fair value at the date the assets and liabilities are acquired is attributed to goodwill (subject to impairment test, as indicated in the following section). If the process of allocating the purchase price shows a negative difference, such difference is immediately charged to the income statement at the date of acquisition. Any consideration subject to conditions set forth in the business combination contract is measured at fair value on the acquisition date and considered in the value of the consideration paid for the business combination, for the purposes of calculating the goodwill. Non-controlling interests on the acquisition date are measured at fair value or according to the pro rata amount of the net assets of the acquired company. The valuation method selected is stated for each transaction. In the case of business combinations that take place in phases, the equity investment previously held by the Group in the acquired company is valued at the fair value on the date control was acquired and any resulting profit or loss is recognised in the income statement. Losses in value (impairment) - As of each balance sheet date and when events or situation changes indicate that the book value cannot be recovered, the Group takes into consideration the book value of property, plant and equipment and intangible assets in order to assess whether these assets have suffered an impairment. If there is any indication in this sense, the recoverable amount of said assets is estimated so as to determine the total write-down. The recoverable amount is either the fair value, less sales costs or the usage value, whichever is the greater. Where it is not possible to estimate the recoverable value of an asset individually, the Group estimates the recoverable value of the unit generating the cash flows to which said assets belong. Future cash flows are discounted to present value at a rate (net of taxation) that reflects the current market value and takes into account the risks associated with the specific business activities. If the recoverable amount of an asset (or of a cash generating unit) is estimated as lower than the related book value, the book value of the assets is reduced to the lower recoverable value and the impairment is booked to the income statement. When there is no longer any reason for a write-down to be maintained, the book value of the asset (or the unit generating financial flows), with the exception of goodwill, is restated at the new value deriving from the estimate of its recoverable value; however, this new value cannot exceed the net book value that the asset would have had if the write-down had not been made for the loss in value. The write-back of the value is charged to the income statement. Investments valued at shareholders\u2019 equity method - Investments entered in this item refer to long- term investments in associated companies and joint ventures. An associated company is a company over which the Group is able to exercise remarkable influence, but not control, by means of participation in the decisions on the financial and operating policies of the investee company. A joint venture is a jointly controlled arrangement in which the entities that share joint control have rights to the net assets of the arrangement. Under the equity method, investments are recognised at cost, as adjusted for any changes following acquisition in the associated companies\u2019 net assets, minus any impairment. The excess price over the Group\u2019s share of the fair value of an associated company\u2019s identifiable assets, liabilities and contingent liabilities at the date of acquisition is recognised as goodwill. Goodwill is included in the carrying amount of the investment and is tested for impairment. Other investments - This category includes investments that are not included in the scope of consolidation, including investments in negligible size subsidiaries, associates and joint ventures. For these investments, upon initial recognition, it is irrevocably determined whether subsequent changes in fair value are recognised in other comprehensive income; otherwise, changes in fair value are periodically recognised in profit or loss. This approach does not include equity investments held exclusively for the purpose of subsequent disposal, whose changes in fair value are recognized in profit (loss) for the fiscal period. The risk deriving from any losses exceeding the book value of the investment is recorded in a specific reserve to the extent that the holder is obliged to fulfil legal or implicit obligations vis-\u00e0-vis the investee company or in any event cover its losses. Financial assets - The Group classifies financial assets through the business model adopted for managing them and on the basis of the features of contractual cashflows In relation to the previous conditions, financial assets are subsequently valued as follows: \u25aa depreciated cost; \u25aa fair value of the other comprehensive income components; \u25aa fair value of the profit (loss) for the fiscal period. Management determines their classification when they are first recorded. Receivables and loans - This category includes assets not represented by derivative instruments and not listed on an active market, from which fixed or determinable payments are expected. Since the business model generally adopted by the Group provides for the holding of these financial instruments solely for the purpose of collecting the contractual cash flows, these assets are valued at depreciated cost on the basis of the effective interest rate method. The value of the assets is reduced on the basis of the expected losses, using information that is available without unreasonable charges or efforts, including historical, current and prospective data. Losses determined by an impairment test are recognized in the income statement, as are any subsequent reversals of impairment losses. These assets are classified as current assets, except for the portions accruing after 12 months, which are included amongst the non- current assets. This category includes, as provided by the interpretation IFRIC 12, the financial assets associated to those public service under concession for which the Group has the unconditional contractual right to receive liquidity from the issuer for the construction services rendered. The Group uses the financial asset model for the contracts of public lighting service provision, in view of their characteristics, in which increasingly frequently the issuer guarantees the area provider a specific amount, or at any rate an amount which can be reliably determined, not depending on the use of the infrastructure by the final customer. Under that model, the financial asset reported in the balance sheet in relation to the issuer for an amount equal to the fair value of the construction services rendered. Financial assets at fair value recorded in the comprehensive income components - This category includes assets, other than derivatives, held by the Group for the purpose of receiving contractual cash flows (represented by equity and interest payments) or for monetisation through sale. These assets are valued at fair value, the latter determined by referring to the market prices at the balance sheet date or using financial measurement techniques and models, recording their change in value in a specific equity reserve. The changes in value due to the impairment test as well as of profit/loss on the exchange rate are recorded in the profit (loss) for the fiscal period This reserve is reclassified to income only when the financial asset is actually sold. Classification as a current or non-current asset depends on management\u2019s plans and on the real tradability of the security. Those whose sale is expected during the next 12 months are recorded as current assets. Should there be objective proof of indicators of impairment, the value of the assets is reduced to such an extent as to be equal to the discounted value of the flows that can be obtained in the future. The impairment previously booked is restored if the circumstances that brought about its recording no longer exist. Assets valued at fair value recorded as profit (loss) for the fiscal period - This category includes the financial assets acquired for short-term trading purposes, in addition to the derivatives, which are described in the specific paragraph below. The fair value of these instruments is determined by referring to the market value on the date the registration period ends. Classification under current and non-current reflects management \u2018s expectations regarding their trading: current assets include those whose trading is expected within 12 months or those identified as held for trading. Cash and cash equivalents - The item regarding cash holdings and cash equivalents includes cash and bank accounts and deposits repayable on demand and other short-term financial investments with high liquidity that are readily convertible into cash and are subject to an insignificant risk regarding their change in value. Trade receivables - These refer to financial assets arising from the provision of goods and services and are valued at amortised cost, adjusted for any impairment. These assets are derecognized in the event of sale which transfers all risks and benefits associated with their management to third parties. Other current assets - These are stated at par value, and possibly adjusted for any losses in value corresponding to the amortised cost. Environmental bonds - The Group complies with the various regulations issued in relation to the environment that require compliance with restrictions established through the use of certificates or bonds. Therefore, the Group is obliged to meet a need in terms of grey certificates (emission trading) and white certificates (energy efficiency instruments). The development of markets in which these bonds/certificates are traded has also made it possible to initiate a trading activity. These bonds are valued according to the intended use. The bonds held to meet the company\u2019s requirement are recorded as assets at cost. If the bonds in the portfolio prove to be insufficient to meet the need, a liability is recorded to guarantee adequate coverage when the certificates are delivered to the operator. Bonds held for trading are recognised as assets and are measured at fair value through profit or loss. Contract work in progress - Where the outcome of a construction contract can be estimated reliably, contract work in progress is measured on the basis of revenues accrued with reasonable certainty, according to the percentage of completion method of accounting, so as to apportion revenues and costs to the relevant financial years in proportion to the stage of completion of the work in question. Contract revenues, in addition to the contractual payments, include the variations, the price review and the recognition of the incentives to the extent it is probable that they represent effective revenues which can be determined reliably. When the result of a contract cannot be reliably estimated, the revenues referable to the related contract are recorded solely within the limits of the contract costs incurred which will probably be recovered. The contract costs are recorded as expenses during the accounting period in which they are incurred. When it is probable that the total contract costs will be greater than the contractual revenues, the expected loss is immediately stated at cost. Inventories - Inventories are recorded at cost, including directly attributable costs, or net estimated realizable value, whichever is the lower. The cost configurations used for the valuation of stocks are the average cost measured on a continuous basis (used for raw materials and consumables) and the specific cost of other inventories. The net realisable value is calculated on the basis of the current costs of the inventories at year end, less the estimated costs necessary for achieving the sale. The value of obsolete and slow-moving stock is written down in relation to the possible use or realization, by means of the provision of a specific materials obsolescence allowance. Inventories of work in progress are valued at weighted average manufacturing cost for the period, which comprises the raw materials, the consumables and the direct and indirect production costs excluding general expenses. Share capital - share capital is recorded at par value, reduced, if necessary, by costs directly attributable to transactions involving the issuing or repurchase of equity instruments. Treasury shares - treasury shares are recognised as a reduction in shareholders\u2019 equity, and any differences generated by future purchase or sale transactions are recorded directly as changes in shareholders\u2019 equity, without passing via the income statement. Earnings per share - The earnings per share are represented by the net profit for the year attributable to the shareholders holding ordinary shares, taking into account the weighted average of the ordinary shares outstanding during the year. The diluted earnings per share are obtained by means of the adjustment of the weighted average of the shares outstanding, taking into account all the potential ordinary shares with dilution effect. Financial liabilities - This item is initially stated at cost, corresponding to the fair value of the liability net of the transaction costs which are directly attributable to the issue of said liability. Following their initial recognition, financial liabilities, with the exception of derivatives, are valued on the basis of amortised cost, using the original effective interest rate method. If the estimates of payments are revised, the adjustment of the liability is stated as income or expense in the income statement, except for lease liabilities. Lease liabilities - As at the effective date of the contract, lease liabilities are calculated as the present value of payments due, discounted using the interest rate of the lease or, in case it is not easily identifiable, the marginal lending rate. The payments included in the calculation of the liability are: (a) fixed payments; (b) variable payments depending on an index or a rate; (c) amounts expected to be paid to secure the residual value; (d) the exercise price of the purchase option, if any, if the term of the lease considers it; (e) any penalties for terminating the contract, if the term of the lease considers them. The marginal lending rate refers to the average rate at which the Group borrows, broken down by contractual maturity. It is determined annually in the budget on the basis of the final figures for previous financial year and is applied to contracts signed from 1 January of each subsequent financial year. It is updated during the period in the event of significant changes to the Group\u2019s average borrowing rate. For contracts with a life of more than 4 years, the Group uses the medium/long-term borrowing rate, while for contracts with a life of 4 years or less, the equivalent short-term rate is adopted. After the initial date, lease liabilities are modified as a result of: a) accrued financial expenses recorded to the income statement; b) payments made to the lessor; c) any new valuations or changes to the lease or the revision of the assumptions regarding the payments due to the lessor. Post-employment benefits - Liabilities related to defined-benefit plans (such as the employee severance accrued before 1 January 2007) are reported net of any plan assets on the basis of actuarial assumptions and on an accrual basis, in keeping with the service necessary to obtain benefits. The liability is valued by independent actuaries. Independent actuaries assess financial liabilities. The liability is valued by independent actuaries. Actuarial gains and losses are reported as other comprehensive income/losses. Following Law 296 of 27 December 2006, for companies with more than 50 employees, the severance amounts accruing after 1 January 2017 qualify as a defined-benefit plan. Provisions for risks and charges - The provisions for risks and charges comprise the amounts set aside as recorded in the financial statements on the basis of current obligations (as emerging from past events) which the Group believes it probably will have to meet. The provisions are set aside on the basis of the best estimate of the costs required to meet the obligation, as of the balance sheet date (assuming that there are sufficient elements for being able to make this estimate) and are discounted to present value when the effect is significant and the necessary information is available. In such event, the provisions are determined by discounting to present value the future cash flows at a pre-tax discount rate that reflects the current market valuation and takes into account the risk associated with the business activities. When the discounting to present value is carried out, the increase in the provision due to the passing of time is recorded amongst the financial charges. If the liability relates to property, plant and equipment (e.g. restoration of sites), the contra-entry to the provision made is an increase of the asset to which the liability refers; on the other hand, the financial charges are expensed out through the depreciation process of the item of property, plant and equipment to which the charge refers. The methods envisaged by IFRIC 1 are adopted if liabilities are recalculated. Trade payables - These refer to payables derived from commercial supply transactions and are recorded at amortised cost. Other current liabilities - These concern sundry transactions and are stated at nominal value, corresponding to the amortised cost. Derivative instruments - The Group holds derivative instruments for the purpose of hedging its exposure to the risk of interest rate and exchange rate fluctuations and the risk of changes in methane gas and electricity prices. In relation to said activities, the Group must handle the risks associated with the misalignment between the index-linking formulas relating to the purchase of gas and electricity and the index-linking formulas linked to the sale of said commodities. The instruments the Group uses for handling price risk, both with regards to the price of the goods and the related Euro/Dollar exchange rate, are aimed at pre-establishing the effects on the sales margins irrespective of the changes in the aforementioned market conditions. In relation to commodity derivatives, operations are managed through OTCs - over the counter financial instruments (index swaps), currency derivatives (forward purchases in dollars), derivative instruments traded on the regulated platform Eex, as well as through brokerage contracts that provide for the physical delivery of the underlying (so-called physical contracts). In particular, the accounting method used for physical contracts varies according to their purpose: contracts related to procurement activities are subject to the own-use exemption and the related economic effects are recognised on an accrual basis only at the time of actual delivery, while contracts signed with reference to price or volume risk management activities are considered derivative financial instruments and measured at fair value from the time they are signed. Given the nature of physical contracts, in order to give a more consistent representation of the actual transactions carried out, at the time they become operational, regardless of their purpose, the settlement is recorded in the income statement either in the item \u201cRevenues\u201d or in the item \u201cRaw materials and materials\u201d depending on whether the sale or procurement of commodities was involved. From an operational point of view, a commercial portfolio has been identified, which includes physical and financial contracts signed for the management of procurement, and a trading portfolio, which includes physical and financial contracts signed for speculation, based on pure position taking logics whenever there is a market opportunity, always within the risk limits defined by the Board of Directors of the parent company. The fair-value changes pertaining transactions that, in observance of the risk management policies, meet the requirements laid down by the accounting standards for hedge accounting treatment are recorded (in the terms indicated below) as part of the other components of comprehensive income, while those that despite being entered into for hedging purposes, do not meet the requirements set by the standards are recognises in profit or loss in the period in which they occur. Operations identified from their outset as speculative are recognised in profit or loss in the reporting period. Fair value is established with adequate valuation models for each type of instrument, according to the reference market value as more fully described below. For hedge accounting purposes, the Group formally designates and documents the hedging relationship, its risk management objectives and the strategy pursued, identifying: i) the hedging instrument, ii) the nature of the risk being hedged, and iii) the way the effectiveness of the hedge will be assessed. The hedging relationship is effective if: i) there is an economic relationship between the hedging instrument and the hedged item; ii) the credit risk does not prevail over the changes in fair value resulting from the economic relationship; and iii) the hedge ratio is the same as the ratio between the quantity of the hedged item that the Group actually hedges and the quantity of the hedging instrument that the Group actually uses to hedge that quantity of the hedged item and no imbalance is identified. For accounting purposes, the hedging transactions are classified as fair value hedges if they cover the risk of fluctuations in the market value of the underlying asset or liability; or as cash flow hedges if they cover the risk of changes in cash flows deriving both from an existing asset or liability, or from a future transaction, including transactions on commodities. As far as derivative instruments classified as fair value hedges are concerned, which observe the conditions for the accounting treatment as hedging transactions, the gains and losses deriving from the determination of their market value are recognized through profit or loss. The gains and losses deriving from the adjustment to fair value of the element underlying the hedge are also recognized through profit or loss. For instruments classified as cash flow hedges and that qualify as such, the fair value changes are recorded, only as far as the effective amount is concerned, in a reserve called \u201cCash flow hedge reserve\u201d through the statement of comprehensive income. This reserve is recorded to income as soon as the underlying hedged instrument is realised. The change in fair value referring to the ineffective portion is immediately recorded in the income statement of the period. If the underlying transaction should no longer be considered highly probable, or the hedging relationship can no longer be demonstrated, the corresponding portion of the \u201cReserve of derivatives valued at fair value\u201d is immediately reversed to income. If, on the other hand, the derivative instrument is sold and therefore the hedging of the risk for which the transaction was created no longer qualifies as effective, the amount of \u201cReserve of derivatives valued at fair value\u201d relating to it is kept until the economic effects of the underlying contract arise. Whenever applicable, the Group adopts the fair value option. Assets and liabilities held for sale - Assets and liabilities held for sale are those whose value will be recovered mainly through sale rather than use. Assets and liabilities are classified under this category the moment the sale operation is considered highly likely and the assets and liabilities are immediately available for sale in their current condition. These assets are valued at either cost or fair value, whichever is lower, net of sales costs. Revenue and cost recognition - Revenues and income are recognized net of returned items, discounts and rebates, and net of taxes directly related to the sales of products and services rendered. These are broken down into revenues deriving from operating activities and financial income which accrues between the sale date and the payment date. Specifically: \u25aa revenues from energy, gas and water sales are recognised and recorded at the moment of the provision of the service and include the services provided but not yet invoiced (estimated on the basis of historical analyses determined according to previous consumption levels); \u25aa revenues from the distribution are recognized on the basis of the tariffs paid by the Aeegsi and are subject to equalization at year end to reflect in accordance with the competence criterion the compensation recognised by the Authority in relation to the investments made; \u25aa revenues are booked at the time (or as) the obligation is fulfilled, transferring the promised good or service to the customer. The transfer occurs when (or as) the customer gains control over the good or service. The revenue recorded corresponds to the price attributed to the obligation to be recorded. Revenue is recorded only if the consideration for the goods or services transferred to the customer is likely to be received; \u25aa costs are accounted for in accordance with the accruals principle. Grants - Capital grants are recognized in the income statement over the period necessary for correlating them to the related costs. They are represented in the statement of financial position by recording the grant as deferred revenue. Operating grants, including those received from users for connection purposes, are considered to be revenues for services rendered during the fiscal period and are therefore recorded on an accruals basis. Lease payments - As defined by IFRS 16, lease payments relating to lease contracts for low-value assets and leases with a contract duration of 12 months or less (short-term leases) are recorded in the income statement as charges for the period. The Group has set a threshold of 10,000 euro for deeming the individual underlying asset to be of modest value. Financial income and expense - Financial income and expense are recognised on an accrual basis. Dividends from \u201cOther shareholdings\u201d are recorded in the income statement, at the time the right to receive payment is established, the economic benefits arising from the dividends are likely to be received by the Group and their value can be assessed reliably. Taxes - Taxes are the sum of current, deferred and possible substitute taxes. Current taxes are calculated on the taxable income for the financial period. Taxable income differs from the result recorded in the income statement, as it may exclude both positive and negative components which will be taxable or deductible in other periods (temporary changes), and components that will never be taxable or deductible (permanent changes). \u201cCurrent tax liabilities\u201d are calculated on the basis of the tax rates applicable on the balance sheet date. In determining tax rates for the period, the Group took into due consideration the effects of the IAS tax reform introduced by Law 244 of 24 December 2007 and in particular the reinforced derivation principle established by Article 83 of the TUIR. This regulation calls for entities that use IFRSs to apply, including in a departure from the provisions of the TUIR, the criteria for the determination, recognition and classification in the financial statements provided for by said accounting standards. Deferred taxes are calculated having regard to timing differences in taxation, and are recorded under item \u201cDeferred tax liabilities\u201d. \u201cDeferred tax assets\u201d are recognised to the extent that the existence of a taxable income at least equal to the amount of the differences to be offset is considered probable when the timing differences will reverse. Deferred taxes are determined on the basis of the tax rates foreseen to be in force during the financial year in which the tax asset will be conferred or the tax liability will be extinguished, on the basis of tax rates established by provisions in force or substantively in force at the date of the financial statements. These changes are recognised in profit or loss or in equity, depending on how the difference in question was originally recorded. Finally, substitute taxes may be recorded when legal provisions exist that allow the Group to take advantage of special tax regimes. These are, by nature, non-recurring taxes, which may be attributed to the Group\u2019s desire to opt or not for the related tax regime. In the event that the substitute tax is paid pursuant to a tax regulation that allows the balance sheet value of a utility to be aligned, in whole or in part, with the corresponding tax value of the utility, the Group proceeds to recognize the total value of future tax benefits (tax assets) and, at the same time, the entire substitute tax in the financial year in which management makes the decision to take advantage of this opportunity. Translation of foreign currency balances - Foreign currency transactions are initially recorded using the exchange rate in force as of the transaction date. Foreign currency assets and liabilities, with the exception of fixed assets, are recorded using the exchange rate in force as at the period end date and the related exchange gains and losses are recognized through profit or loss. Any net gain that might arise is set aside in a specific restricted reserve until the date of realization. Transactions with related parties - Transactions with related parties take place on an arms\u2019-length basis, in observance of efficiency and cost-effectiveness criteria. Some specific transactions are remunerated on the basis of rates established by ARERA resolutions.", "dimensions": { "concept": "ifrs-full:DisclosureOfSummaryOfSignificantAccountingPoliciesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-477": { "value": "Tangible assets are recorded at cost or production cost, including accessory costs, or at the value based on expert appraisals, if relating to purchased companies, net of the related accumulated depreciation and any impairment. The production cost includes the portion of direct and indirect costs reasonably attributable to the asset (e.g. personnel costs, transport, customs duty, costs for the preparation of the installation location, final test & inspection costs, notary fees, land registry expenses). The cost includes any professional fees and, for certain assets, capitalised financial charges up to the moment the asset enters into service. The cost also comprises the possible costs for dismantling, recovering and reclamation of the site that hosts the item of property, plant and equipment, if it complies with the provisions of IAS 37. Ordinary maintenance costs are charged in full to the income statement. Improvement, upgrading and transformation costs which increase the value of the assets are recorded as assets. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDecommissioningRestorationAndRehabilitationProvisionsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-450": { "value": "Tangible assets are recorded at cost or production cost, including accessory costs, or at the value based on expert appraisals, if relating to purchased companies, net of the related accumulated depreciation and any impairment. The production cost includes the portion of direct and indirect costs reasonably attributable to the asset (e.g. personnel costs, transport, customs duty, costs for the preparation of the installation location, final test & inspection costs, notary fees, land registry expenses). The cost includes any professional fees and, for certain assets, capitalised financial charges up to the moment the asset enters into service. The cost also comprises the possible costs for dismantling, recovering and reclamation of the site that hosts the item of property, plant and equipment, if it complies with the provisions of IAS 37. Ordinary maintenance costs are charged in full to the income statement. Improvement, upgrading and transformation costs which increase the value of the assets are recorded as assets. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForBorrowingCostsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-496": { "value": "Ordinary maintenance costs are charged in full to the income statement. Improvement, upgrading and transformation costs which increase the value of the assets are recorded as assets. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForRepairsAndMaintenanceExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-15": { "value": "Depreciation starts to be applied when the assets enter the production cycle. Tangible assets are classified as in progress when the process of economic use has not yet begun. The property, plant and equipment are systematically depreciated in each accounting period using the depreciation rates considered representative of the remaining useful lives of the assets. The rates of the amortisation for tangible assets are outlined here below: Category rates Buildings 1.8% - 2.8% Distribution plants 1.4% - 5.9% Production plants 2.5% - 25.0% Other plants 3.9% - 7.5% Equipment 5.0% - 20.0% Electronic machines 16.7% - 20.0% Vehicles 10.0% - 20.0% Land is not depreciated, with the exception of land in which landfills are located, which is depreciated based on the quantity of waste disposed of with respect to the total conferrable capacity. After the initial recognition, the value of the right of use is reduced by accrued depreciation and impairment and is adjusted for any restatements of the lease liability. If the lease transfers the ownership of the underlying asset at the end of the lease term, the right of use is depreciated beginning from the effective date until the end of the useful life of the underlying asset, otherwise the depreciation is calculated on the basis of the lease duration. The asset consisting of the right of use is subject to an impairment test to identify any loss in value. The depreciation of the concessions are calculated on the basis of the provisions of the respective conventions, and namely: i) according to a constant rate for the shorter of the following two periods: the useful life of the assets granted in concession and the duration of that same concession, provided that, when this concession expires, the outgoing operator is not granted any compensation value (Residual industrial value, or RIV); ii) according to the useful life of the individual assets if, at the moment the concessions expire, the assets in question are expected to pass into the hands of the operator. The depreciation of these rights is carried out based on the useful life of the individual assets, also in view of the relevant legislation which, in the event of a change in service provider, calls for compensation to be paid to the outgoing operator in the amount of the Residual Industrial Value (RIV) for assets constructed under their ownership, or at Net Book Value (NBV), for assets manufactured under a business unit leasing contract. The depreciation begins when the asset is ready for use according to the needs of the corporate management. The depreciation rates of intangible assets are outlined here below: Category rates IT applications 20.0% Patents and trademarks 10.0% Buildings under concession 1.8% - 3.5% Distribution plants under concession 1.8% - 10.0% Other plants under concession 2.5% - 12.5% Equipment under concession 12.5% ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDepreciationExpenseExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-16": { "value": "Investment property - An item of property is recognized as investment property when it generates cash flows largely independently of the other assets held by the Company, as it is held to earn rentals and/or for capital appreciation or both, not to be utilized in production of for the provision of goods or services or in connection with company operations. As permitted by IAS 40, investment property has been recognized at cost. As such, these assets are reported at cost minus depreciation and any impairment.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInvestmentPropertyExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-424": { "value": "Rights of use - The right of use of a good or service is initially valued by the Group at cost. This cost includes: (a) the initial value of the lease liability (calculated as outlined in the section \u201cLease liabilities\u201d); (b) payments related to the lease contract made before the effective date; (c) initial direct costs related to property, plant and equipment; (d) an estimate of the costs to be incurred by the lessee in dismantling and restoring the asset. Service components that may be included in the contract are excluded from projections of future lease payments and accounted for separately under operating expenses on a straight-line basis. After the initial recognition, the value of the right of use is reduced by accrued depreciation and impairment and is adjusted for any restatements of the lease liability. If the lease transfers the ownership of the underlying asset at the end of the lease term, the right of use is depreciated beginning from the effective date until the end of the useful life of the underlying asset, otherwise the depreciation is calculated on the basis of the lease duration. The asset consisting of the right of use is subject to an impairment test to identify any loss in value. Lease liabilities - As at the effective date of the contract, lease liabilities are calculated as the present value of payments due, discounted using the interest rate of the lease or, in case it is not easily identifiable, the marginal lending rate. The payments included in the calculation of the liability are: (a) fixed payments; (b) variable payments depending on an index or a rate; (c) amounts expected to be paid to secure the residual value; (d) the exercise price of the purchase option, if any, if the term of the lease considers it; (e) any penalties for terminating the contract, if the term of the lease considers them. The marginal lending rate refers to the average rate at which the Group borrows, broken down by contractual maturity. It is determined annually in the budget on the basis of the final figures for previous financial year and is applied to contracts signed from 1 January of each subsequent financial year. It is updated during the period in the event of significant changes to the Group\u2019s average borrowing rate. For contracts with a life of more than 4 years, the Group uses the medium/long-term borrowing rate, while for contracts with a life of 4 years or less, the equivalent short-term rate is adopted. After the initial date, lease liabilities are modified as a result of: a) accrued financial expenses recorded to the income statement; b) payments made to the lessor; c) any new valuations or changes to the lease or the revision of the assumptions regarding the payments due to the lessor. Lease payments - As defined by IFRS 16, lease payments relating to lease contracts for low-value assets and leases with a contract duration of 12 months or less (short-term leases) are recorded in the income statement as charges for the period. The Group has set a threshold of 10,000 euro for deeming the individual underlying asset to be of modest value.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForLeasesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-425": { "value": "Intangible assets and goodwill - Intangible assets which are identifiable and can be monitored, and whose cost can be reliably determined based on the assumption that said assets will generate future economic benefits, are recorded in the accounts. These assets are stated at cost in accordance with the policies indicated for property, plant and equipment and, if they have a definite useful life, they are amortised systematically over the period of the estimated useful life. The depreciation begins when the asset is available for use or in any case begins to generate economic benefit for the Group. Work in progress includes costs relating to intangible assets for which the process of economic use has not yet commenced. If the Intangible assets have an indefinite useful life, they are not amortised but rather subjected to an annual impairment test, even in the absence of indicators signalling losses in value. Research costs are recorded in the income statement. Any development costs for new products and/or processes are booked to the income statement in the year they are incurred, unless their use extends over several years. IT applications are representative of assets that are identifiable and capable of generating future economic benefits under the control of the Group. These rights are depreciated over their relevant useful lives. Concessions mainly comprise the rights associated with networks, plants and other facilities related to gas and integrated water cycle services managed by the Group and are instrumental to the management of these services. These concessions were listed as intangible assets even before the IFRIC 12 - Agreements for concession services - interpretation was first applied. The depreciation of the concessions are calculated on the basis of the provisions of the respective conventions, and namely: i) according to a constant rate for the shorter of the following two periods: the useful life of the assets granted in concession and the duration of that same concession, provided that, when this concession expires, the outgoing operator is not granted any compensation value (Residual industrial value, or RIV); ii) according to the useful life of the individual assets if, at the moment the concessions expire, the assets in question are expected to pass into the hands of the operator. Public services under concession include the rights over networks, plants and other facilities related to gas, integrated water cycle, and electricity (with the sole exception of the assets related to the territory of Modena, which are classified among the assets owned by virtue of the associated acquisition) and public lighting services (for the latter, except for what highlighted in the following note describing the accounting principles applied to the \u201cPayables and financing\u201d item) linked to services managed by the Group. These arrangements are accounted for by applying the intangible asset model provided for the IFRIC 12 interpretation, since it was considered that the underlying concession arrangements do not guarantee the existence of an unconditional right in favour of the concessionaire to receive cash or other financial assets. Construction and improvement services carried out on behalf of the grantor are accounted for as contract work in progress. Considering that most works are contracted out externally and that on construction activities carried out internally the job margin cannot be identified individually from the benefits included in the remuneration for the service, these infrastructures are reported on the basis of costs actually incurred, net of any contributions paid by the entities and/or private customers. This category also includes improvements made and infrastructure constructed on the goods instrumental to the management of these services, which are the property of the Holding Companies (so called Asset Companies, pursuant to Art. 113 of Legislative Decree no. 267/00), yet managed by the Group by virtue of business branch leasing contracts. These contracts, in addition to establishing the fees due, also include clauses governing the restitution of assets, normally maintained, upon payment of a balance corresponding to the net book value or the Industrial Residual Value (also taking into account the recovery funds) of these assets. The depreciation of these rights is carried out based on the useful life of the individual assets, also in view of the relevant legislation which, in the event of a change in service provider, calls for compensation to be paid to the outgoing operator in the amount of the Residual Industrial Value (RIV) for assets constructed under their ownership, or at Net Book Value (NBV), for assets manufactured under a business unit leasing contract. The intangible assets acquired following a business combination are recorded separately from goodwill if their fair value can be reliably determined and are depreciated over the useful life estimated in the purchase price allocation. The depreciation begins when the asset is ready for use according to the needs of the corporate management. Gains or losses on disposal of intangible assets are calculated as the difference between proceeds from the sale and the carrying amount of the asset and are recognized in the income statement when the control of the asset is transferred to the buyer. The depreciation rates of intangible assets are outlined here below: Category rates IT applications 20.0% Patents and trademarks 10.0% Buildings under concession 1.8% - 3.5% Distribution plants under concession 1.8% - 10.0% Other plants under concession 2.5% - 12.5% Equipment under concession 12.5% ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForIntangibleAssetsOtherThanGoodwillExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-451": { "value": "Intangible assets and goodwill - Intangible assets which are identifiable and can be monitored, and whose cost can be reliably determined based on the assumption that said assets will generate future economic benefits, are recorded in the accounts. These assets are stated at cost in accordance with the policies indicated for property, plant and equipment and, if they have a definite useful life, they are amortised systematically over the period of the estimated useful life. The depreciation begins when the asset is available for use or in any case begins to generate economic benefit for the Group. Work in progress includes costs relating to intangible assets for which the process of economic use has not yet commenced. If the Intangible assets have an indefinite useful life, they are not amortised but rather subjected to an annual impairment test, even in the absence of indicators signalling losses in value. Research costs are recorded in the income statement. Any development costs for new products and/or processes are booked to the income statement in the year they are incurred, unless their use extends over several years. IT applications are representative of assets that are identifiable and capable of generating future economic benefits under the control of the Group. These rights are depreciated over their relevant useful lives. Concessions mainly comprise the rights associated with networks, plants and other facilities related to gas and integrated water cycle services managed by the Group and are instrumental to the management of these services. These concessions were listed as intangible assets even before the IFRIC 12 - Agreements for concession services - interpretation was first applied. The depreciation of the concessions are calculated on the basis of the provisions of the respective conventions, and namely: i) according to a constant rate for the shorter of the following two periods: the useful life of the assets granted in concession and the duration of that same concession, provided that, when this concession expires, the outgoing operator is not granted any compensation value (Residual industrial value, or RIV); ii) according to the useful life of the individual assets if, at the moment the concessions expire, the assets in question are expected to pass into the hands of the operator. Public services under concession include the rights over networks, plants and other facilities related to gas, integrated water cycle, and electricity (with the sole exception of the assets related to the territory of Modena, which are classified among the assets owned by virtue of the associated acquisition) and public lighting services (for the latter, except for what highlighted in the following note describing the accounting principles applied to the \u201cPayables and financing\u201d item) linked to services managed by the Group. These arrangements are accounted for by applying the intangible asset model provided for the IFRIC 12 interpretation, since it was considered that the underlying concession arrangements do not guarantee the existence of an unconditional right in favour of the concessionaire to receive cash or other financial assets. Construction and improvement services carried out on behalf of the grantor are accounted for as contract work in progress. Considering that most works are contracted out externally and that on construction activities carried out internally the job margin cannot be identified individually from the benefits included in the remuneration for the service, these infrastructures are reported on the basis of costs actually incurred, net of any contributions paid by the entities and/or private customers. This category also includes improvements made and infrastructure constructed on the goods instrumental to the management of these services, which are the property of the Holding Companies (so called Asset Companies, pursuant to Art. 113 of Legislative Decree no. 267/00), yet managed by the Group by virtue of business branch leasing contracts. These contracts, in addition to establishing the fees due, also include clauses governing the restitution of assets, normally maintained, upon payment of a balance corresponding to the net book value or the Industrial Residual Value (also taking into account the recovery funds) of these assets. The depreciation of these rights is carried out based on the useful life of the individual assets, also in view of the relevant legislation which, in the event of a change in service provider, calls for compensation to be paid to the outgoing operator in the amount of the Residual Industrial Value (RIV) for assets constructed under their ownership, or at Net Book Value (NBV), for assets manufactured under a business unit leasing contract. The intangible assets acquired following a business combination are recorded separately from goodwill if their fair value can be reliably determined and are depreciated over the useful life estimated in the purchase price allocation. The depreciation begins when the asset is ready for use according to the needs of the corporate management. Gains or losses on disposal of intangible assets are calculated as the difference between proceeds from the sale and the carrying amount of the asset and are recognized in the income statement when the control of the asset is transferred to the buyer. The depreciation rates of intangible assets are outlined here below: Category rates IT applications 20.0% Patents and trademarks 10.0% Buildings under concession 1.8% - 3.5% Distribution plants under concession 1.8% - 10.0% Other plants under concession 2.5% - 12.5% Equipment under concession 12.5% ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForIntangibleAssetsAndGoodwillExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-478": { "value": "Intangible assets and goodwill - Intangible assets which are identifiable and can be monitored, and whose cost can be reliably determined based on the assumption that said assets will generate future economic benefits, are recorded in the accounts. These assets are stated at cost in accordance with the policies indicated for property, plant and equipment and, if they have a definite useful life, they are amortised systematically over the period of the estimated useful life. The depreciation begins when the asset is available for use or in any case begins to generate economic benefit for the Group. Work in progress includes costs relating to intangible assets for which the process of economic use has not yet commenced. If the Intangible assets have an indefinite useful life, they are not amortised but rather subjected to an annual impairment test, even in the absence of indicators signalling losses in value. Research costs are recorded in the income statement. Any development costs for new products and/or processes are booked to the income statement in the year they are incurred, unless their use extends over several years. IT applications are representative of assets that are identifiable and capable of generating future economic benefits under the control of the Group. These rights are depreciated over their relevant useful lives. Concessions mainly comprise the rights associated with networks, plants and other facilities related to gas and integrated water cycle services managed by the Group and are instrumental to the management of these services. These concessions were listed as intangible assets even before the IFRIC 12 - Agreements for concession services - interpretation was first applied. The depreciation of the concessions are calculated on the basis of the provisions of the respective conventions, and namely: i) according to a constant rate for the shorter of the following two periods: the useful life of the assets granted in concession and the duration of that same concession, provided that, when this concession expires, the outgoing operator is not granted any compensation value (Residual industrial value, or RIV); ii) according to the useful life of the individual assets if, at the moment the concessions expire, the assets in question are expected to pass into the hands of the operator. Public services under concession include the rights over networks, plants and other facilities related to gas, integrated water cycle, and electricity (with the sole exception of the assets related to the territory of Modena, which are classified among the assets owned by virtue of the associated acquisition) and public lighting services (for the latter, except for what highlighted in the following note describing the accounting principles applied to the \u201cPayables and financing\u201d item) linked to services managed by the Group. These arrangements are accounted for by applying the intangible asset model provided for the IFRIC 12 interpretation, since it was considered that the underlying concession arrangements do not guarantee the existence of an unconditional right in favour of the concessionaire to receive cash or other financial assets. Construction and improvement services carried out on behalf of the grantor are accounted for as contract work in progress. Considering that most works are contracted out externally and that on construction activities carried out internally the job margin cannot be identified individually from the benefits included in the remuneration for the service, these infrastructures are reported on the basis of costs actually incurred, net of any contributions paid by the entities and/or private customers. This category also includes improvements made and infrastructure constructed on the goods instrumental to the management of these services, which are the property of the Holding Companies (so called Asset Companies, pursuant to Art. 113 of Legislative Decree no. 267/00), yet managed by the Group by virtue of business branch leasing contracts. These contracts, in addition to establishing the fees due, also include clauses governing the restitution of assets, normally maintained, upon payment of a balance corresponding to the net book value or the Industrial Residual Value (also taking into account the recovery funds) of these assets. The depreciation of these rights is carried out based on the useful life of the individual assets, also in view of the relevant legislation which, in the event of a change in service provider, calls for compensation to be paid to the outgoing operator in the amount of the Residual Industrial Value (RIV) for assets constructed under their ownership, or at Net Book Value (NBV), for assets manufactured under a business unit leasing contract. The intangible assets acquired following a business combination are recorded separately from goodwill if their fair value can be reliably determined and are depreciated over the useful life estimated in the purchase price allocation. The depreciation begins when the asset is ready for use according to the needs of the corporate management. Gains or losses on disposal of intangible assets are calculated as the difference between proceeds from the sale and the carrying amount of the asset and are recognized in the income statement when the control of the asset is transferred to the buyer. The depreciation rates of intangible assets are outlined here below: Category rates IT applications 20.0% Patents and trademarks 10.0% Buildings under concession 1.8% - 3.5% Distribution plants under concession 1.8% - 10.0% Other plants under concession 2.5% - 12.5% Equipment under concession 12.5% ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForGoodwillExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-17": { "value": "Research costs are recorded in the income statement. Any development costs for new products and/or processes are booked to the income statement in the year they are incurred, unless their use extends over several years. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForResearchAndDevelopmentExpenseExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-409": { "value": "Public services under concession include the rights over networks, plants and other facilities related to gas, integrated water cycle, and electricity (with the sole exception of the assets related to the territory of Modena, which are classified among the assets owned by virtue of the associated acquisition) and public lighting services (for the latter, except for what highlighted in the following note describing the accounting principles applied to the \u201cPayables and financing\u201d item) linked to services managed by the Group. These arrangements are accounted for by applying the intangible asset model provided for the IFRIC 12 interpretation, since it was considered that the underlying concession arrangements do not guarantee the existence of an unconditional right in favour of the concessionaire to receive cash or other financial assets. Construction and improvement services carried out on behalf of the grantor are accounted for as contract work in progress. Considering that most works are contracted out externally and that on construction activities carried out internally the job margin cannot be identified individually from the benefits included in the remuneration for the service, these infrastructures are reported on the basis of costs actually incurred, net of any contributions paid by the entities and/or private customers. This category also includes improvements made and infrastructure constructed on the goods instrumental to the management of these services, which are the property of the Holding Companies (so called Asset Companies, pursuant to Art. 113 of Legislative Decree no. 267/00), yet managed by the Group by virtue of business branch leasing contracts. These contracts, in addition to establishing the fees due, also include clauses governing the restitution of assets, normally maintained, upon payment of a balance corresponding to the net book value or the Industrial Residual Value (also taking into account the recovery funds) of these assets. \u201cPublic services under concession\u201d includes assets relating to gas distribution, electricity distribution (Imola area), the integrated water cycle and public lighting activities (except for the latter, as specified in note 18 \u201cCurrent financial assets, cash and cash equivalents\u201d) provided through contracts awarded by the respective public bodies. These concession relationships and associated assets involved in carrying out the activities for which the Group holds the use rights, are accounted for by applying the intangible asset model as set forth by IFRIC 12 interpretation. Investments for the year related mainly to the water networks, in the amount of 118.7 million euro, and gas distribution networks, in the amount of 51.5 million euro. It should be noted that, during the year, the item was changed by the reclassification of the assets related to the urban sanitation service in the areas of Bologna and Modena, which were previously classified as tangible assets due to the different regulatory framework, following the awarding of the tender for the area, as reported in detail in Note 21 \u201cTangible assets\u201d. Depreciation and amortization for the period, up sharply from last year, is therefore also affected by the above reclassification. \u201cIntangible assets under construction and public services under concession\u201d includes investments related to these concessions that are still to be completed at the end of the period and mainly refers to the water networks, in the amount of 89.8 million euro, and gas distribution networks, in the amount of 34.3 million euro. ", "dimensions": { "concept": "ifrs-full:DisclosureOfServiceConcessionArrangementsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-497": { "value": "Public services under concession include the rights over networks, plants and other facilities related to gas, integrated water cycle, and electricity (with the sole exception of the assets related to the territory of Modena, which are classified among the assets owned by virtue of the associated acquisition) and public lighting services (for the latter, except for what highlighted in the following note describing the accounting principles applied to the \u201cPayables and financing\u201d item) linked to services managed by the Group. These arrangements are accounted for by applying the intangible asset model provided for the IFRIC 12 interpretation, since it was considered that the underlying concession arrangements do not guarantee the existence of an unconditional right in favour of the concessionaire to receive cash or other financial assets. Construction and improvement services carried out on behalf of the grantor are accounted for as contract work in progress. Considering that most works are contracted out externally and that on construction activities carried out internally the job margin cannot be identified individually from the benefits included in the remuneration for the service, these infrastructures are reported on the basis of costs actually incurred, net of any contributions paid by the entities and/or private customers. This category also includes improvements made and infrastructure constructed on the goods instrumental to the management of these services, which are the property of the Holding Companies (so called Asset Companies, pursuant to Art. 113 of Legislative Decree no. 267/00), yet managed by the Group by virtue of business branch leasing contracts. These contracts, in addition to establishing the fees due, also include clauses governing the restitution of assets, normally maintained, upon payment of a balance corresponding to the net book value or the Industrial Residual Value (also taking into account the recovery funds) of these assets. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForServiceConcessionArrangementsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-18": { "value": "Cost of acquiring new contracts - As required by IFRS 15, incremental costs, represented by commissions paid to agents for the acquisition of new energy supply contracts, are recognized as intangible assets and are amortised according to the average useful life of the acquired customers (churn rate). For this purpose, only the types of commissions related to new customers not present in the Group\u2019s customer base are recognized.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForCustomerAcquisitionCostsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-426": { "value": "Business combinations - Business combination operations are accounted for by applying the acquisition method foreseen by IFRS 3, as a consequence of which the buyer acquires the equity and takes over the assets and liabilities of the acquired company. The cost of the operation is shown as the fair value of the transferred assets, liabilities assumed and equity instruments issued in exchange for the control of the acquired company, as at the date of acquisition. The expenses related to the business combination are generally recognised in the income statement at the time they are incurred. Any positive difference between the cost of the transaction and the fair value at the date the assets and liabilities are acquired is attributed to goodwill (subject to impairment test, as indicated in the following section). If the process of allocating the purchase price shows a negative difference, such difference is immediately charged to the income statement at the date of acquisition. Any consideration subject to conditions set forth in the business combination contract is measured at fair value on the acquisition date and considered in the value of the consideration paid for the business combination, for the purposes of calculating the goodwill. Non-controlling interests on the acquisition date are measured at fair value or according to the pro rata amount of the net assets of the acquired company. The valuation method selected is stated for each transaction. In the case of business combinations that take place in phases, the equity investment previously held by the Group in the acquired company is valued at the fair value on the date control was acquired and any resulting profit or loss is recognised in the income statement. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForBusinessCombinationsAndGoodwillExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-452": { "value": "Business combinations - Business combination operations are accounted for by applying the acquisition method foreseen by IFRS 3, as a consequence of which the buyer acquires the equity and takes over the assets and liabilities of the acquired company. The cost of the operation is shown as the fair value of the transferred assets, liabilities assumed and equity instruments issued in exchange for the control of the acquired company, as at the date of acquisition. The expenses related to the business combination are generally recognised in the income statement at the time they are incurred. Any positive difference between the cost of the transaction and the fair value at the date the assets and liabilities are acquired is attributed to goodwill (subject to impairment test, as indicated in the following section). If the process of allocating the purchase price shows a negative difference, such difference is immediately charged to the income statement at the date of acquisition. Any consideration subject to conditions set forth in the business combination contract is measured at fair value on the acquisition date and considered in the value of the consideration paid for the business combination, for the purposes of calculating the goodwill. Non-controlling interests on the acquisition date are measured at fair value or according to the pro rata amount of the net assets of the acquired company. The valuation method selected is stated for each transaction. In the case of business combinations that take place in phases, the equity investment previously held by the Group in the acquired company is valued at the fair value on the date control was acquired and any resulting profit or loss is recognised in the income statement. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForBusinessCombinationsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-19": { "value": "Losses in value (impairment) - As of each balance sheet date and when events or situation changes indicate that the book value cannot be recovered, the Group takes into consideration the book value of property, plant and equipment and intangible assets in order to assess whether these assets have suffered an impairment. If there is any indication in this sense, the recoverable amount of said assets is estimated so as to determine the total write-down. The recoverable amount is either the fair value, less sales costs or the usage value, whichever is the greater. Where it is not possible to estimate the recoverable value of an asset individually, the Group estimates the recoverable value of the unit generating the cash flows to which said assets belong. Future cash flows are discounted to present value at a rate (net of taxation) that reflects the current market value and takes into account the risks associated with the specific business activities. If the recoverable amount of an asset (or of a cash generating unit) is estimated as lower than the related book value, the book value of the assets is reduced to the lower recoverable value and the impairment is booked to the income statement. When there is no longer any reason for a write-down to be maintained, the book value of the asset (or the unit generating financial flows), with the exception of goodwill, is restated at the new value deriving from the estimate of its recoverable value; however, this new value cannot exceed the net book value that the asset would have had if the write-down had not been made for the loss in value. The write-back of the value is charged to the income statement. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForImpairmentOfNonfinancialAssetsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-453": { "value": "Losses in value (impairment) - As of each balance sheet date and when events or situation changes indicate that the book value cannot be recovered, the Group takes into consideration the book value of property, plant and equipment and intangible assets in order to assess whether these assets have suffered an impairment. If there is any indication in this sense, the recoverable amount of said assets is estimated so as to determine the total write-down. The recoverable amount is either the fair value, less sales costs or the usage value, whichever is the greater. Where it is not possible to estimate the recoverable value of an asset individually, the Group estimates the recoverable value of the unit generating the cash flows to which said assets belong. Future cash flows are discounted to present value at a rate (net of taxation) that reflects the current market value and takes into account the risks associated with the specific business activities. If the recoverable amount of an asset (or of a cash generating unit) is estimated as lower than the related book value, the book value of the assets is reduced to the lower recoverable value and the impairment is booked to the income statement. When there is no longer any reason for a write-down to be maintained, the book value of the asset (or the unit generating financial flows), with the exception of goodwill, is restated at the new value deriving from the estimate of its recoverable value; however, this new value cannot exceed the net book value that the asset would have had if the write-down had not been made for the loss in value. The write-back of the value is charged to the income statement. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForImpairmentOfAssetsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-428": { "value": "Investments valued at shareholders\u2019 equity method - Investments entered in this item refer to long- term investments in associated companies and joint ventures. An associated company is a company over which the Group is able to exercise remarkable influence, but not control, by means of participation in the decisions on the financial and operating policies of the investee company. A joint venture is a jointly controlled arrangement in which the entities that share joint control have rights to the net assets of the arrangement. Under the equity method, investments are recognised at cost, as adjusted for any changes following acquisition in the associated companies\u2019 net assets, minus any impairment. The excess price over the Group\u2019s share of the fair value of an associated company\u2019s identifiable assets, liabilities and contingent liabilities at the date of acquisition is recognised as goodwill. Goodwill is included in the carrying amount of the investment and is tested for impairment.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInvestmentInAssociatesAndJointVenturesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-455": { "value": "Investments valued at shareholders\u2019 equity method - Investments entered in this item refer to long- term investments in associated companies and joint ventures. An associated company is a company over which the Group is able to exercise remarkable influence, but not control, by means of participation in the decisions on the financial and operating policies of the investee company. A joint venture is a jointly controlled arrangement in which the entities that share joint control have rights to the net assets of the arrangement. Under the equity method, investments are recognised at cost, as adjusted for any changes following acquisition in the associated companies\u2019 net assets, minus any impairment. The excess price over the Group\u2019s share of the fair value of an associated company\u2019s identifiable assets, liabilities and contingent liabilities at the date of acquisition is recognised as goodwill. Goodwill is included in the carrying amount of the investment and is tested for impairment.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInvestmentInAssociates", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-481": { "value": "Investments valued at shareholders\u2019 equity method - Investments entered in this item refer to long- term investments in associated companies and joint ventures. An associated company is a company over which the Group is able to exercise remarkable influence, but not control, by means of participation in the decisions on the financial and operating policies of the investee company. A joint venture is a jointly controlled arrangement in which the entities that share joint control have rights to the net assets of the arrangement. Under the equity method, investments are recognised at cost, as adjusted for any changes following acquisition in the associated companies\u2019 net assets, minus any impairment. The excess price over the Group\u2019s share of the fair value of an associated company\u2019s identifiable assets, liabilities and contingent liabilities at the date of acquisition is recognised as goodwill. Goodwill is included in the carrying amount of the investment and is tested for impairment. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInvestmentsInJointVentures", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-20": { "value": "Other investments - This category includes investments that are not included in the scope of consolidation, including investments in negligible size subsidiaries, associates and joint ventures. For these investments, upon initial recognition, it is irrevocably determined whether subsequent changes in fair value are recognised in other comprehensive income; otherwise, changes in fair value are periodically recognised in profit or loss. This approach does not include equity investments held exclusively for the purpose of subsequent disposal, whose changes in fair value are recognized in profit (loss) for the fiscal period. The risk deriving from any losses exceeding the book value of the investment is recorded in a specific reserve to the extent that the holder is obliged to fulfil legal or implicit obligations vis-\u00e0-vis the investee company or in any event cover its losses.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInvestmentsOtherThanInvestmentsAccountedForUsingEquityMethodExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-427": { "value": "Financial assets - The Group classifies financial assets through the business model adopted for managing them and on the basis of the features of contractual cashflows In relation to the previous conditions, financial assets are subsequently valued as follows: \u25aa depreciated cost; \u25aa fair value of the other comprehensive income components; \u25aa fair value of the profit (loss) for the fiscal period. Management determines their classification when they are first recorded. Receivables and loans - This category includes assets not represented by derivative instruments and not listed on an active market, from which fixed or determinable payments are expected. Since the business model generally adopted by the Group provides for the holding of these financial instruments solely for the purpose of collecting the contractual cash flows, these assets are valued at depreciated cost on the basis of the effective interest rate method. The value of the assets is reduced on the basis of the expected losses, using information that is available without unreasonable charges or efforts, including historical, current and prospective data. Losses determined by an impairment test are recognized in the income statement, as are any subsequent reversals of impairment losses. These assets are classified as current assets, except for the portions accruing after 12 months, which are included amongst the non- current assets. This category includes, as provided by the interpretation IFRIC 12, the financial assets associated to those public service under concession for which the Group has the unconditional contractual right to receive liquidity from the issuer for the construction services rendered. The Group uses the financial asset model for the contracts of public lighting service provision, in view of their characteristics, in which increasingly frequently the issuer guarantees the area provider a specific amount, or at any rate an amount which can be reliably determined, not depending on the use of the infrastructure by the final customer. Under that model, the financial asset reported in the balance sheet in relation to the issuer for an amount equal to the fair value of the construction services rendered. Financial assets at fair value recorded in the comprehensive income components - This category includes assets, other than derivatives, held by the Group for the purpose of receiving contractual cash flows (represented by equity and interest payments) or for monetisation through sale. These assets are valued at fair value, the latter determined by referring to the market prices at the balance sheet date or using financial measurement techniques and models, recording their change in value in a specific equity reserve. The changes in value due to the impairment test as well as of profit/loss on the exchange rate are recorded in the profit (loss) for the fiscal period This reserve is reclassified to income only when the financial asset is actually sold. Classification as a current or non-current asset depends on management\u2019s plans and on the real tradability of the security. Those whose sale is expected during the next 12 months are recorded as current assets. Should there be objective proof of indicators of impairment, the value of the assets is reduced to such an extent as to be equal to the discounted value of the flows that can be obtained in the future. The impairment previously booked is restored if the circumstances that brought about its recording no longer exist.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialAssetsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-454": { "value": "Financial assets - The Group classifies financial assets through the business model adopted for managing them and on the basis of the features of contractual cashflows In relation to the previous conditions, financial assets are subsequently valued as follows: \u25aa depreciated cost; \u25aa fair value of the other comprehensive income components; \u25aa fair value of the profit (loss) for the fiscal period. Management determines their classification when they are first recorded. Receivables and loans - This category includes assets not represented by derivative instruments and not listed on an active market, from which fixed or determinable payments are expected. Since the business model generally adopted by the Group provides for the holding of these financial instruments solely for the purpose of collecting the contractual cash flows, these assets are valued at depreciated cost on the basis of the effective interest rate method. The value of the assets is reduced on the basis of the expected losses, using information that is available without unreasonable charges or efforts, including historical, current and prospective data. Losses determined by an impairment test are recognized in the income statement, as are any subsequent reversals of impairment losses. These assets are classified as current assets, except for the portions accruing after 12 months, which are included amongst the non- current assets. This category includes, as provided by the interpretation IFRIC 12, the financial assets associated to those public service under concession for which the Group has the unconditional contractual right to receive liquidity from the issuer for the construction services rendered. The Group uses the financial asset model for the contracts of public lighting service provision, in view of their characteristics, in which increasingly frequently the issuer guarantees the area provider a specific amount, or at any rate an amount which can be reliably determined, not depending on the use of the infrastructure by the final customer. Under that model, the financial asset reported in the balance sheet in relation to the issuer for an amount equal to the fair value of the construction services rendered. Financial assets at fair value recorded in the comprehensive income components - This category includes assets, other than derivatives, held by the Group for the purpose of receiving contractual cash flows (represented by equity and interest payments) or for monetisation through sale. These assets are valued at fair value, the latter determined by referring to the market prices at the balance sheet date or using financial measurement techniques and models, recording their change in value in a specific equity reserve. The changes in value due to the impairment test as well as of profit/loss on the exchange rate are recorded in the profit (loss) for the fiscal period This reserve is reclassified to income only when the financial asset is actually sold. Classification as a current or non-current asset depends on management\u2019s plans and on the real tradability of the security. Those whose sale is expected during the next 12 months are recorded as current assets. Should there be objective proof of indicators of impairment, the value of the assets is reduced to such an extent as to be equal to the discounted value of the flows that can be obtained in the future. The impairment previously booked is restored if the circumstances that brought about its recording no longer exist. Assets valued at fair value recorded as profit (loss) for the fiscal period - This category includes the financial assets acquired for short-term trading purposes, in addition to the derivatives, which are described in the specific paragraph below. The fair value of these instruments is determined by referring to the market value on the date the registration period ends. Classification under current and non-current reflects management \u2018s expectations regarding their trading: current assets include those whose trading is expected within 12 months or those identified as held for trading. Financial liabilities - This item is initially stated at cost, corresponding to the fair value of the liability net of the transaction costs which are directly attributable to the issue of said liability. Following their initial recognition, financial liabilities, with the exception of derivatives, are valued on the basis of amortised cost, using the original effective interest rate method. If the estimates of payments are revised, the adjustment of the liability is stated as income or expense in the income statement, except for lease liabilities. Derivative instruments - The Group holds derivative instruments for the purpose of hedging its exposure to the risk of interest rate and exchange rate fluctuations and the risk of changes in methane gas and electricity prices. In relation to said activities, the Group must handle the risks associated with the misalignment between the index-linking formulas relating to the purchase of gas and electricity and the index-linking formulas linked to the sale of said commodities. The instruments the Group uses for handling price risk, both with regards to the price of the goods and the related Euro/Dollar exchange rate, are aimed at pre-establishing the effects on the sales margins irrespective of the changes in the aforementioned market conditions. In relation to commodity derivatives, operations are managed through OTCs - over the counter financial instruments (index swaps), currency derivatives (forward purchases in dollars), derivative instruments traded on the regulated platform Eex, as well as through brokerage contracts that provide for the physical delivery of the underlying (so-called physical contracts). In particular, the accounting method used for physical contracts varies according to their purpose: contracts related to procurement activities are subject to the own-use exemption and the related economic effects are recognised on an accrual basis only at the time of actual delivery, while contracts signed with reference to price or volume risk management activities are considered derivative financial instruments and measured at fair value from the time they are signed. Given the nature of physical contracts, in order to give a more consistent representation of the actual transactions carried out, at the time they become operational, regardless of their purpose, the settlement is recorded in the income statement either in the item \u201cRevenues\u201d or in the item \u201cRaw materials and materials\u201d depending on whether the sale or procurement of commodities was involved. From an operational point of view, a commercial portfolio has been identified, which includes physical and financial contracts signed for the management of procurement, and a trading portfolio, which includes physical and financial contracts signed for speculation, based on pure position taking logics whenever there is a market opportunity, always within the risk limits defined by the Board of Directors of the parent company. The fair-value changes pertaining transactions that, in observance of the risk management policies, meet the requirements laid down by the accounting standards for hedge accounting treatment are recorded (in the terms indicated below) as part of the other components of comprehensive income, while those that despite being entered into for hedging purposes, do not meet the requirements set by the standards are recognises in profit or loss in the period in which they occur. Operations identified from their outset as speculative are recognised in profit or loss in the reporting period. Fair value is established with adequate valuation models for each type of instrument, according to the reference market value as more fully described below. For hedge accounting purposes, the Group formally designates and documents the hedging relationship, its risk management objectives and the strategy pursued, identifying: i) the hedging instrument, ii) the nature of the risk being hedged, and iii) the way the effectiveness of the hedge will be assessed. The hedging relationship is effective if: i) there is an economic relationship between the hedging instrument and the hedged item; ii) the credit risk does not prevail over the changes in fair value resulting from the economic relationship; and iii) the hedge ratio is the same as the ratio between the quantity of the hedged item that the Group actually hedges and the quantity of the hedging instrument that the Group actually uses to hedge that quantity of the hedged item and no imbalance is identified. For accounting purposes, the hedging transactions are classified as fair value hedges if they cover the risk of fluctuations in the market value of the underlying asset or liability; or as cash flow hedges if they cover the risk of changes in cash flows deriving both from an existing asset or liability, or from a future transaction, including transactions on commodities. As far as derivative instruments classified as fair value hedges are concerned, which observe the conditions for the accounting treatment as hedging transactions, the gains and losses deriving from the determination of their market value are recognized through profit or loss. The gains and losses deriving from the adjustment to fair value of the element underlying the hedge are also recognized through profit or loss. For instruments classified as cash flow hedges and that qualify as such, the fair value changes are recorded, only as far as the effective amount is concerned, in a reserve called \u201cCash flow hedge reserve\u201d through the statement of comprehensive income. This reserve is recorded to income as soon as the underlying hedged instrument is realised. The change in fair value referring to the ineffective portion is immediately recorded in the income statement of the period. If the underlying transaction should no longer be considered highly probable, or the hedging relationship can no longer be demonstrated, the corresponding portion of the \u201cReserve of derivatives valued at fair value\u201d is immediately reversed to income. If, on the other hand, the derivative instrument is sold and therefore the hedging of the risk for which the transaction was created no longer qualifies as effective, the amount of \u201cReserve of derivatives valued at fair value\u201d relating to it is kept until the economic effects of the underlying contract arise. Whenever applicable, the Group adopts the fair value option. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialInstrumentsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-479": { "value": "Receivables and loans - This category includes assets not represented by derivative instruments and not listed on an active market, from which fixed or determinable payments are expected. Since the business model generally adopted by the Group provides for the holding of these financial instruments solely for the purpose of collecting the contractual cash flows, these assets are valued at depreciated cost on the basis of the effective interest rate method. The value of the assets is reduced on the basis of the expected losses, using information that is available without unreasonable charges or efforts, including historical, current and prospective data. Losses determined by an impairment test are recognized in the income statement, as are any subsequent reversals of impairment losses. These assets are classified as current assets, except for the portions accruing after 12 months, which are included amongst the non- current assets. This category includes, as provided by the interpretation IFRIC 12, the financial assets associated to those public service under concession for which the Group has the unconditional contractual right to receive liquidity from the issuer for the construction services rendered. The Group uses the financial asset model for the contracts of public lighting service provision, in view of their characteristics, in which increasingly frequently the issuer guarantees the area provider a specific amount, or at any rate an amount which can be reliably determined, not depending on the use of the infrastructure by the final customer. Under that model, the financial asset reported in the balance sheet in relation to the issuer for an amount equal to the fair value of the construction services rendered. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForLoansAndReceivablesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-480": { "value": "Financial assets at fair value recorded in the comprehensive income components - This category includes assets, other than derivatives, held by the Group for the purpose of receiving contractual cash flows (represented by equity and interest payments) or for monetisation through sale. These assets are valued at fair value, the latter determined by referring to the market prices at the balance sheet date or using financial measurement techniques and models, recording their change in value in a specific equity reserve. The changes in value due to the impairment test as well as of profit/loss on the exchange rate are recorded in the profit (loss) for the fiscal period This reserve is reclassified to income only when the financial asset is actually sold. Classification as a current or non-current asset depends on management\u2019s plans and on the real tradability of the security. Those whose sale is expected during the next 12 months are recorded as current assets. Should there be objective proof of indicators of impairment, the value of the assets is reduced to such an extent as to be equal to the discounted value of the flows that can be obtained in the future. The impairment previously booked is restored if the circumstances that brought about its recording no longer exist.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForHeldtomaturityInvestmentsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-498": { "value": "Financial assets at fair value recorded in the comprehensive income components - This category includes assets, other than derivatives, held by the Group for the purpose of receiving contractual cash flows (represented by equity and interest payments) or for monetisation through sale. These assets are valued at fair value, the latter determined by referring to the market prices at the balance sheet date or using financial measurement techniques and models, recording their change in value in a specific equity reserve. The changes in value due to the impairment test as well as of profit/loss on the exchange rate are recorded in the profit (loss) for the fiscal period This reserve is reclassified to income only when the financial asset is actually sold. Classification as a current or non-current asset depends on management\u2019s plans and on the real tradability of the security. Those whose sale is expected during the next 12 months are recorded as current assets. Should there be objective proof of indicators of impairment, the value of the assets is reduced to such an extent as to be equal to the discounted value of the flows that can be obtained in the future. The impairment previously booked is restored if the circumstances that brought about its recording no longer exist.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForAvailableforsaleFinancialAssetsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-21": { "value": "Should there be objective proof of indicators of impairment, the value of the assets is reduced to such an extent as to be equal to the discounted value of the flows that can be obtained in the future. The impairment previously booked is restored if the circumstances that brought about its recording no longer exist.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForImpairmentOfFinancialAssetsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-410": { "value": "Assets valued at fair value recorded as profit (loss) for the fiscal period - This category includes the financial assets acquired for short-term trading purposes, in addition to the derivatives, which are described in the specific paragraph below. The fair value of these instruments is determined by referring to the market value on the date the registration period ends. Classification under current and non-current reflects management \u2018s expectations regarding their trading: current assets include those whose trading is expected within 12 months or those identified as held for trading. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialInstrumentsAtFairValueThroughProfitOrLossExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-22": { "value": "Trade receivables - These refer to financial assets arising from the provision of goods and services and are valued at amortised cost, adjusted for any impairment. These assets are derecognized in the event of sale which transfers all risks and benefits associated with their management to third parties. Other current assets - These are stated at par value, and possibly adjusted for any losses in value corresponding to the amortised cost. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForTradeAndOtherReceivablesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-23": { "value": "Environmental bonds - The Group complies with the various regulations issued in relation to the environment that require compliance with restrictions established through the use of certificates or bonds. Therefore, the Group is obliged to meet a need in terms of grey certificates (emission trading) and white certificates (energy efficiency instruments). The development of markets in which these bonds/certificates are traded has also made it possible to initiate a trading activity. These bonds are valued according to the intended use. The bonds held to meet the company\u2019s requirement are recorded as assets at cost. If the bonds in the portfolio prove to be insufficient to meet the need, a liability is recorded to guarantee adequate coverage when the certificates are delivered to the operator. Bonds held for trading are recognised as assets and are measured at fair value through profit or loss.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForEmissionRightsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-24": { "value": "Contract work in progress - Where the outcome of a construction contract can be estimated reliably, contract work in progress is measured on the basis of revenues accrued with reasonable certainty, according to the percentage of completion method of accounting, so as to apportion revenues and costs to the relevant financial years in proportion to the stage of completion of the work in question. Contract revenues, in addition to the contractual payments, include the variations, the price review and the recognition of the incentives to the extent it is probable that they represent effective revenues which can be determined reliably. When the result of a contract cannot be reliably estimated, the revenues referable to the related contract are recorded solely within the limits of the contract costs incurred which will probably be recovered. The contract costs are recorded as expenses during the accounting period in which they are incurred. When it is probable that the total contract costs will be greater than the contractual revenues, the expected loss is immediately stated at cost. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForConstructionInProgressExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-25": { "value": "Inventories - Inventories are recorded at cost, including directly attributable costs, or net estimated realizable value, whichever is the lower. The cost configurations used for the valuation of stocks are the average cost measured on a continuous basis (used for raw materials and consumables) and the specific cost of other inventories. The net realisable value is calculated on the basis of the current costs of the inventories at year end, less the estimated costs necessary for achieving the sale. The value of obsolete and slow-moving stock is written down in relation to the possible use or realization, by means of the provision of a specific materials obsolescence allowance. Inventories of work in progress are valued at weighted average manufacturing cost for the period, which comprises the raw materials, the consumables and the direct and indirect production costs excluding general expenses.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForMeasuringInventories", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-482": { "value": "Share capital - share capital is recorded at par value, reduced, if necessary, by costs directly attributable to transactions involving the issuing or repurchase of equity instruments. In the event that the substitute tax is paid pursuant to a tax regulation that allows the balance sheet value of a utility to be aligned, in whole or in part, with the corresponding tax value of the utility, the Group proceeds to recognize the total value of future tax benefits (tax assets) and, at the same time, the entire substitute tax in the financial year in which management makes the decision to take advantage of this opportunity. The share capital at 31 December 2022 amounted to 1,489,538,745 ordinary shares with a nominal value of 1 euro each and is fully paid-up. The number of treasury shares held by the Group at 31 December 2022 was 38,541,380 (29,217,962 at 31 December 2021). ", "dimensions": { "concept": "ifrs-full:DisclosureOfIssuedCapitalExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-26": { "value": "Earnings per share - The earnings per share are represented by the net profit for the year attributable to the shareholders holding ordinary shares, taking into account the weighted average of the ordinary shares outstanding during the year. The diluted earnings per share are obtained by means of the adjustment of the weighted average of the shares outstanding, taking into account all the potential ordinary shares with dilution effect.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForEarningsPerShareExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-27": { "value": "Financial liabilities - This item is initially stated at cost, corresponding to the fair value of the liability net of the transaction costs which are directly attributable to the issue of said liability. Following their initial recognition, financial liabilities, with the exception of derivatives, are valued on the basis of amortised cost, using the original effective interest rate method. If the estimates of payments are revised, the adjustment of the liability is stated as income or expense in the income statement, except for lease liabilities. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialLiabilitiesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-483": { "value": "Financial liabilities - This item is initially stated at cost, corresponding to the fair value of the liability net of the transaction costs which are directly attributable to the issue of said liability. Following their initial recognition, financial liabilities, with the exception of derivatives, are valued on the basis of amortised cost, using the original effective interest rate method. If the estimates of payments are revised, the adjustment of the liability is stated as income or expense in the income statement, except for lease liabilities. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForBorrowingsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-28": { "value": "Post-employment benefits - Liabilities related to defined-benefit plans (such as the employee severance accrued before 1 January 2007) are reported net of any plan assets on the basis of actuarial assumptions and on an accrual basis, in keeping with the service necessary to obtain benefits. The liability is valued by independent actuaries. Independent actuaries assess financial liabilities. The liability is valued by independent actuaries. Actuarial gains and losses are reported as other comprehensive income/losses. Following Law 296 of 27 December 2006, for companies with more than 50 employees, the severance amounts accruing after 1 January 2017 qualify as a defined-benefit plan.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForEmployeeBenefitsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-29": { "value": "Provisions for risks and charges - The provisions for risks and charges comprise the amounts set aside as recorded in the financial statements on the basis of current obligations (as emerging from past events) which the Group believes it probably will have to meet. The provisions are set aside on the basis of the best estimate of the costs required to meet the obligation, as of the balance sheet date (assuming that there are sufficient elements for being able to make this estimate) and are discounted to present value when the effect is significant and the necessary information is available. In such event, the provisions are determined by discounting to present value the future cash flows at a pre-tax discount rate that reflects the current market valuation and takes into account the risk associated with the business activities. When the discounting to present value is carried out, the increase in the provision due to the passing of time is recorded amongst the financial charges. If the liability relates to property, plant and equipment (e.g. restoration of sites), the contra-entry to the provision made is an increase of the asset to which the liability refers; on the other hand, the financial charges are expensed out through the depreciation process of the item of property, plant and equipment to which the charge refers. The methods envisaged by IFRIC 1 are adopted if liabilities are recalculated. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForProvisionsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-30": { "value": "Trade payables - These refer to payables derived from commercial supply transactions and are recorded at amortised cost. Other current liabilities - These concern sundry transactions and are stated at nominal value, corresponding to the amortised cost.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForTradeAndOtherPayablesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-429": { "value": "Derivative instruments - The Group holds derivative instruments for the purpose of hedging its exposure to the risk of interest rate and exchange rate fluctuations and the risk of changes in methane gas and electricity prices. In relation to said activities, the Group must handle the risks associated with the misalignment between the index-linking formulas relating to the purchase of gas and electricity and the index-linking formulas linked to the sale of said commodities. The instruments the Group uses for handling price risk, both with regards to the price of the goods and the related Euro/Dollar exchange rate, are aimed at pre-establishing the effects on the sales margins irrespective of the changes in the aforementioned market conditions. In relation to commodity derivatives, operations are managed through OTCs - over the counter financial instruments (index swaps), currency derivatives (forward purchases in dollars), derivative instruments traded on the regulated platform Eex, as well as through brokerage contracts that provide for the physical delivery of the underlying (so-called physical contracts). In particular, the accounting method used for physical contracts varies according to their purpose: contracts related to procurement activities are subject to the own-use exemption and the related economic effects are recognised on an accrual basis only at the time of actual delivery, while contracts signed with reference to price or volume risk management activities are considered derivative financial instruments and measured at fair value from the time they are signed. Given the nature of physical contracts, in order to give a more consistent representation of the actual transactions carried out, at the time they become operational, regardless of their purpose, the settlement is recorded in the income statement either in the item \u201cRevenues\u201d or in the item \u201cRaw materials and materials\u201d depending on whether the sale or procurement of commodities was involved. From an operational point of view, a commercial portfolio has been identified, which includes physical and financial contracts signed for the management of procurement, and a trading portfolio, which includes physical and financial contracts signed for speculation, based on pure position taking logics whenever there is a market opportunity, always within the risk limits defined by the Board of Directors of the parent company. The fair-value changes pertaining transactions that, in observance of the risk management policies, meet the requirements laid down by the accounting standards for hedge accounting treatment are recorded (in the terms indicated below) as part of the other components of comprehensive income, while those that despite being entered into for hedging purposes, do not meet the requirements set by the standards are recognises in profit or loss in the period in which they occur. Operations identified from their outset as speculative are recognised in profit or loss in the reporting period. Fair value is established with adequate valuation models for each type of instrument, according to the reference market value as more fully described below. For hedge accounting purposes, the Group formally designates and documents the hedging relationship, its risk management objectives and the strategy pursued, identifying: i) the hedging instrument, ii) the nature of the risk being hedged, and iii) the way the effectiveness of the hedge will be assessed. The hedging relationship is effective if: i) there is an economic relationship between the hedging instrument and the hedged item; ii) the credit risk does not prevail over the changes in fair value resulting from the economic relationship; and iii) the hedge ratio is the same as the ratio between the quantity of the hedged item that the Group actually hedges and the quantity of the hedging instrument that the Group actually uses to hedge that quantity of the hedged item and no imbalance is identified. For accounting purposes, the hedging transactions are classified as fair value hedges if they cover the risk of fluctuations in the market value of the underlying asset or liability; or as cash flow hedges if they cover the risk of changes in cash flows deriving both from an existing asset or liability, or from a future transaction, including transactions on commodities. As far as derivative instruments classified as fair value hedges are concerned, which observe the conditions for the accounting treatment as hedging transactions, the gains and losses deriving from the determination of their market value are recognized through profit or loss. The gains and losses deriving from the adjustment to fair value of the element underlying the hedge are also recognized through profit or loss. For instruments classified as cash flow hedges and that qualify as such, the fair value changes are recorded, only as far as the effective amount is concerned, in a reserve called \u201cCash flow hedge reserve\u201d through the statement of comprehensive income. This reserve is recorded to income as soon as the underlying hedged instrument is realised. The change in fair value referring to the ineffective portion is immediately recorded in the income statement of the period. If the underlying transaction should no longer be considered highly probable, or the hedging relationship can no longer be demonstrated, the corresponding portion of the \u201cReserve of derivatives valued at fair value\u201d is immediately reversed to income. If, on the other hand, the derivative instrument is sold and therefore the hedging of the risk for which the transaction was created no longer qualifies as effective, the amount of \u201cReserve of derivatives valued at fair value\u201d relating to it is kept until the economic effects of the underlying contract arise. Whenever applicable, the Group adopts the fair value option. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDerivativeFinancialInstrumentsAndHedgingExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-484": { "value": "Derivative instruments - The Group holds derivative instruments for the purpose of hedging its exposure to the risk of interest rate and exchange rate fluctuations and the risk of changes in methane gas and electricity prices. In relation to said activities, the Group must handle the risks associated with the misalignment between the index-linking formulas relating to the purchase of gas and electricity and the index-linking formulas linked to the sale of said commodities. The instruments the Group uses for handling price risk, both with regards to the price of the goods and the related Euro/Dollar exchange rate, are aimed at pre-establishing the effects on the sales margins irrespective of the changes in the aforementioned market conditions. In relation to commodity derivatives, operations are managed through OTCs - over the counter financial instruments (index swaps), currency derivatives (forward purchases in dollars), derivative instruments traded on the regulated platform Eex, as well as through brokerage contracts that provide for the physical delivery of the underlying (so-called physical contracts). In particular, the accounting method used for physical contracts varies according to their purpose: contracts related to procurement activities are subject to the own-use exemption and the related economic effects are recognised on an accrual basis only at the time of actual delivery, while contracts signed with reference to price or volume risk management activities are considered derivative financial instruments and measured at fair value from the time they are signed. Given the nature of physical contracts, in order to give a more consistent representation of the actual transactions carried out, at the time they become operational, regardless of their purpose, the settlement is recorded in the income statement either in the item \u201cRevenues\u201d or in the item \u201cRaw materials and materials\u201d depending on whether the sale or procurement of commodities was involved. From an operational point of view, a commercial portfolio has been identified, which includes physical and financial contracts signed for the management of procurement, and a trading portfolio, which includes physical and financial contracts signed for speculation, based on pure position taking logics whenever there is a market opportunity, always within the risk limits defined by the Board of Directors of the parent company. The fair-value changes pertaining transactions that, in observance of the risk management policies, meet the requirements laid down by the accounting standards for hedge accounting treatment are recorded (in the terms indicated below) as part of the other components of comprehensive income, while those that despite being entered into for hedging purposes, do not meet the requirements set by the standards are recognises in profit or loss in the period in which they occur. Operations identified from their outset as speculative are recognised in profit or loss in the reporting period. Fair value is established with adequate valuation models for each type of instrument, according to the reference market value as more fully described below. For hedge accounting purposes, the Group formally designates and documents the hedging relationship, its risk management objectives and the strategy pursued, identifying: i) the hedging instrument, ii) the nature of the risk being hedged, and iii) the way the effectiveness of the hedge will be assessed. The hedging relationship is effective if: i) there is an economic relationship between the hedging instrument and the hedged item; ii) the credit risk does not prevail over the changes in fair value resulting from the economic relationship; and iii) the hedge ratio is the same as the ratio between the quantity of the hedged item that the Group actually hedges and the quantity of the hedging instrument that the Group actually uses to hedge that quantity of the hedged item and no imbalance is identified. For accounting purposes, the hedging transactions are classified as fair value hedges if they cover the risk of fluctuations in the market value of the underlying asset or liability; or as cash flow hedges if they cover the risk of changes in cash flows deriving both from an existing asset or liability, or from a future transaction, including transactions on commodities. As far as derivative instruments classified as fair value hedges are concerned, which observe the conditions for the accounting treatment as hedging transactions, the gains and losses deriving from the determination of their market value are recognized through profit or loss. The gains and losses deriving from the adjustment to fair value of the element underlying the hedge are also recognized through profit or loss. For instruments classified as cash flow hedges and that qualify as such, the fair value changes are recorded, only as far as the effective amount is concerned, in a reserve called \u201cCash flow hedge reserve\u201d through the statement of comprehensive income. This reserve is recorded to income as soon as the underlying hedged instrument is realised. The change in fair value referring to the ineffective portion is immediately recorded in the income statement of the period. If the underlying transaction should no longer be considered highly probable, or the hedging relationship can no longer be demonstrated, the corresponding portion of the \u201cReserve of derivatives valued at fair value\u201d is immediately reversed to income. If, on the other hand, the derivative instrument is sold and therefore the hedging of the risk for which the transaction was created no longer qualifies as effective, the amount of \u201cReserve of derivatives valued at fair value\u201d relating to it is kept until the economic effects of the underlying contract arise. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDerivativeFinancialInstrumentsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-411": { "value": "In relation to commodity derivatives, operations are managed through OTCs - over the counter financial instruments (index swaps), currency derivatives (forward purchases in dollars), derivative instruments traded on the regulated platform Eex, as well as through brokerage contracts that provide for the physical delivery of the underlying (so-called physical contracts). In particular, the accounting method used for physical contracts varies according to their purpose: contracts related to procurement activities are subject to the own-use exemption and the related economic effects are recognised on an accrual basis only at the time of actual delivery, while contracts signed with reference to price or volume risk management activities are considered derivative financial instruments and measured at fair value from the time they are signed. Given the nature of physical contracts, in order to give a more consistent representation of the actual transactions carried out, at the time they become operational, regardless of their purpose, the settlement is recorded in the income statement either in the item \u201cRevenues\u201d or in the item \u201cRaw materials and materials\u201d depending on whether the sale or procurement of commodities was involved. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForTradingIncomeAndExpenseExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-499": { "value": "For hedge accounting purposes, the Group formally designates and documents the hedging relationship, its risk management objectives and the strategy pursued, identifying: i) the hedging instrument, ii) the nature of the risk being hedged, and iii) the way the effectiveness of the hedge will be assessed. The hedging relationship is effective if: i) there is an economic relationship between the hedging instrument and the hedged item; ii) the credit risk does not prevail over the changes in fair value resulting from the economic relationship; and iii) the hedge ratio is the same as the ratio between the quantity of the hedged item that the Group actually hedges and the quantity of the hedging instrument that the Group actually uses to hedge that quantity of the hedged item and no imbalance is identified. For accounting purposes, the hedging transactions are classified as fair value hedges if they cover the risk of fluctuations in the market value of the underlying asset or liability; or as cash flow hedges if they cover the risk of changes in cash flows deriving both from an existing asset or liability, or from a future transaction, including transactions on commodities. As far as derivative instruments classified as fair value hedges are concerned, which observe the conditions for the accounting treatment as hedging transactions, the gains and losses deriving from the determination of their market value are recognized through profit or loss. The gains and losses deriving from the adjustment to fair value of the element underlying the hedge are also recognized through profit or loss.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForHedgingExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-31": { "value": "Assets and liabilities held for sale - Assets and liabilities held for sale are those whose value will be recovered mainly through sale rather than use. Assets and liabilities are classified under this category the moment the sale operation is considered highly likely and the assets and liabilities are immediately available for sale in their current condition. These assets are valued at either cost or fair value, whichever is lower, net of sales costs.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForNoncurrentAssetsOrDisposalGroupsClassifiedAsHeldForSaleExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-456": { "value": "Assets and liabilities held for sale - Assets and liabilities held for sale are those whose value will be recovered mainly through sale rather than use. Assets and liabilities are classified under this category the moment the sale operation is considered highly likely and the assets and liabilities are immediately available for sale in their current condition. These assets are valued at either cost or fair value, whichever is lower, net of sales costs.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForNoncurrentAssetsOrDisposalGroupsClassifiedAsHeldForSaleAndDiscontinuedOperationsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-32": { "value": "Revenue and cost recognition - Revenues and income are recognized net of returned items, discounts and rebates, and net of taxes directly related to the sales of products and services rendered. These are broken down into revenues deriving from operating activities and financial income which accrues between the sale date and the payment date. Specifically: \u25aa revenues from energy, gas and water sales are recognised and recorded at the moment of the provision of the service and include the services provided but not yet invoiced (estimated on the basis of historical analyses determined according to previous consumption levels); \u25aa revenues from the distribution are recognized on the basis of the tariffs paid by the Aeegsi and are subject to equalization at year end to reflect in accordance with the competence criterion the compensation recognised by the Authority in relation to the investments made; \u25aa revenues are booked at the time (or as) the obligation is fulfilled, transferring the promised good or service to the customer. The transfer occurs when (or as) the customer gains control over the good or service. The revenue recorded corresponds to the price attributed to the obligation to be recorded. Revenue is recorded only if the consideration for the goods or services transferred to the customer is likely to be received; \u25aa costs are accounted for in accordance with the accruals principle.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForRecognitionOfRevenue", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-457": { "value": "Revenue and cost recognition - Revenues and income are recognized net of returned items, discounts and rebates, and net of taxes directly related to the sales of products and services rendered. These are broken down into revenues deriving from operating activities and financial income which accrues between the sale date and the payment date. Specifically: \u25aa revenues from energy, gas and water sales are recognised and recorded at the moment of the provision of the service and include the services provided but not yet invoiced (estimated on the basis of historical analyses determined according to previous consumption levels); \u25aa revenues from the distribution are recognized on the basis of the tariffs paid by the Aeegsi and are subject to equalization at year end to reflect in accordance with the competence criterion the compensation recognised by the Authority in relation to the investments made; \u25aa revenues are booked at the time (or as) the obligation is fulfilled, transferring the promised good or service to the customer. The transfer occurs when (or as) the customer gains control over the good or service. The revenue recorded corresponds to the price attributed to the obligation to be recorded. Revenue is recorded only if the consideration for the goods or services transferred to the customer is likely to be received; \u25aa costs are accounted for in accordance with the accruals principle. Recognition of revenues Revenues for the sale of electricity, gas and water are recognised and accounted for at supply only if the consideration is expected to be collected. They include the allocation for services rendered between the date of the last reading and the end of the financial year, but not yet billed. This allocation is based on estimated of the customer\u2019s daily consumption, based on the historic profile, adjusted to reflect the weather conditions or other factors which might affect consumption under evaluation.", "dimensions": { "concept": "ifrs-full:DisclosureOfRevenueFromContractsWithCustomersExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-412": { "value": "Revenue and cost recognition - Revenues and income are recognized net of returned items, discounts and rebates, and net of taxes directly related to the sales of products and services rendered. These are broken down into revenues deriving from operating activities and financial income which accrues between the sale date and the payment date. Specifically: \u25aa revenues from energy, gas and water sales are recognised and recorded at the moment of the provision of the service and include the services provided but not yet invoiced (estimated on the basis of historical analyses determined according to previous consumption levels); \u25aa revenues from the distribution are recognized on the basis of the tariffs paid by the Aeegsi and are subject to equalization at year end to reflect in accordance with the competence criterion the compensation recognised by the Authority in relation to the investments made; \u25aa revenues are booked at the time (or as) the obligation is fulfilled, transferring the promised good or service to the customer. The transfer occurs when (or as) the customer gains control over the good or service. The revenue recorded corresponds to the price attributed to the obligation to be recorded. Revenue is recorded only if the consideration for the goods or services transferred to the customer is likely to be received; \u25aa costs are accounted for in accordance with the accruals principle. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForExpensesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-33": { "value": "Grants - Capital grants are recognized in the income statement over the period necessary for correlating them to the related costs. They are represented in the statement of financial position by recording the grant as deferred revenue. Operating grants, including those received from users for connection purposes, are considered to be revenues for services rendered during the fiscal period and are therefore recorded on an accruals basis.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForGovernmentGrants", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-34": { "value": "Financial income and expense - Financial income and expense are recognised on an accrual basis. Dividends from \u201cOther shareholdings\u201d are recorded in the income statement, at the time the right to receive payment is established, the economic benefits arising from the dividends are likely to be received by the Group and their value can be assessed reliably.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinanceIncomeAndCostsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-458": { "value": "Financial income and expense - Financial income and expense are recognised on an accrual basis. Dividends from \u201cOther shareholdings\u201d are recorded in the income statement, at the time the right to receive payment is established, the economic benefits arising from the dividends are likely to be received by the Group and their value can be assessed reliably.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDividendsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-485": { "value": "Financial income and expense - Financial income and expense are recognised on an accrual basis. Dividends from \u201cOther shareholdings\u201d are recorded in the income statement, at the time the right to receive payment is established, the economic benefits arising from the dividends are likely to be received by the Group and their value can be assessed reliably.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInterestIncomeAndExpenseExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-500": { "value": "Financial income and expense - Financial income and expense are recognised on an accrual basis. Dividends from \u201cOther shareholdings\u201d are recorded in the income statement, at the time the right to receive payment is established, the economic benefits arising from the dividends are likely to be received by the Group and their value can be assessed reliably.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinanceCostsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-430": { "value": "Taxes - Taxes are the sum of current, deferred and possible substitute taxes. Current taxes are calculated on the taxable income for the financial period. Taxable income differs from the result recorded in the income statement, as it may exclude both positive and negative components which will be taxable or deductible in other periods (temporary changes), and components that will never be taxable or deductible (permanent changes). \u201cCurrent tax liabilities\u201d are calculated on the basis of the tax rates applicable on the balance sheet date. In determining tax rates for the period, the Group took into due consideration the effects of the IAS tax reform introduced by Law 244 of 24 December 2007 and in particular the reinforced derivation principle established by Article 83 of the TUIR. This regulation calls for entities that use IFRSs to apply, including in a departure from the provisions of the TUIR, the criteria for the determination, recognition and classification in the financial statements provided for by said accounting standards. Deferred taxes are calculated having regard to timing differences in taxation, and are recorded under item \u201cDeferred tax liabilities\u201d. \u201cDeferred tax assets\u201d are recognised to the extent that the existence of a taxable income at least equal to the amount of the differences to be offset is considered probable when the timing differences will reverse. Deferred taxes are determined on the basis of the tax rates foreseen to be in force during the financial year in which the tax asset will be conferred or the tax liability will be extinguished, on the basis of tax rates established by provisions in force or substantively in force at the date of the financial statements. These changes are recognised in profit or loss or in equity, depending on how the difference in question was originally recorded. Finally, substitute taxes may be recorded when legal provisions exist that allow the Group to take advantage of special tax regimes. These are, by nature, non-recurring taxes, which may be attributed to the Group\u2019s desire to opt or not for the related tax regime. In the event that the substitute tax is paid pursuant to a tax regulation that allows the balance sheet value of a utility to be aligned, in whole or in part, with the corresponding tax value of the utility, the Group proceeds to recognize the total value of future tax benefits (tax assets) and, at the same time, the entire substitute tax in the financial year in which management makes the decision to take advantage of this opportunity. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForIncomeTaxExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-35": { "value": "Deferred taxes are calculated having regard to timing differences in taxation, and are recorded under item \u201cDeferred tax liabilities\u201d. \u201cDeferred tax assets\u201d are recognised to the extent that the existence of a taxable income at least equal to the amount of the differences to be offset is considered probable when the timing differences will reverse. Deferred taxes are determined on the basis of the tax rates foreseen to be in force during the financial year in which the tax asset will be conferred or the tax liability will be extinguished, on the basis of tax rates established by provisions in force or substantively in force at the date of the financial statements. These changes are recognised in profit or loss or in equity, depending on how the difference in question was originally recorded.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDeferredIncomeTaxExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-459": { "value": "Finally, substitute taxes may be recorded when legal provisions exist that allow the Group to take advantage of special tax regimes. These are, by nature, non-recurring taxes, which may be attributed to the Group\u2019s desire to opt or not for the related tax regime. In the event that the substitute tax is paid pursuant to a tax regulation that allows the balance sheet value of a utility to be aligned, in whole or in part, with the corresponding tax value of the utility, the Group proceeds to recognize the total value of future tax benefits (tax assets) and, at the same time, the entire substitute tax in the financial year in which management makes the decision to take advantage of this opportunity", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForTaxesOtherThanIncomeTaxExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-36": { "value": "Translation of foreign currency balances - Foreign currency transactions are initially recorded using the exchange rate in force as of the transaction date. Foreign currency assets and liabilities, with the exception of fixed assets, are recorded using the exchange rate in force as at the period end date and the related exchange gains and losses are recognized through profit or loss. Any net gain that might arise is set aside in a specific restricted reserve until the date of realization.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForForeignCurrencyTranslationExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-37": { "value": "Transactions with related parties - Transactions with related parties take place on an arms\u2019-length basis, in observance of efficiency and cost-effectiveness criteria. Some specific transactions are remunerated on the basis of rates established by ARERA resolutions.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForTransactionsWithRelatedPartiesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-431": { "value": "Risk management Credit risk The credit risk faced by the Group originates from the broad structure of the client portfolios in the main business areas in which it operates; for the same reason, this risk is spread out over a large number of clients. In order to manage the credit risk, the Group established procedures for selecting, monitoring and evaluating its customer portfolio. The Italian market is the benchmark market. The Group\u2019s credit management model makes it possible to analytically determine the different risks associated with the collectability of trade receivables as soon as they arise and progressively according to their increasing seniority. This approach allows the company to reduce the concentration and exposure to credit risk posed by both business and household customers. With regard to receivables from small-sized customers, write-downs are carried out on the basis of future-oriented analysis regarding the amount of probable future income, taking into consideration the seniority of the receivables, the type of recovery action undertaken and the status of the creditor. From time to time, analyses are conducted on the individual credit positions yet to be resolved, identifying any criticality, and if the amounts outstanding are uncollectible, in whole or in part, the related receivables are written down. Liquidity risk Liquidity risk concerns the inability to meet the financial obligations taken on due to a lack of internal resources or an inability to find external resources at acceptable costs. Liquidity risk is mitigated by adopting policies and procedures that maximise the efficiency of management of financial resources. For the most part, this is accomplished through the centralised management of cash inflows and outflows (centralised treasury service); in the prospective assessment of the liquidity conditions; in obtaining adequate lines of credit; and preserving an adequate amount of liquidity. The financial planning of requirements, focused on medium-term borrowings, and the availability of abundant funds in credit facilities, allow effective management of liquidity risk. Interest rate risk and currency risk on financing operations The cost of financing is affected by interest rate fluctuations. In the same way, the fair value of financial liabilities is also subject to interest rate and exchange rate fluctuations. The Group regularly assesses its exposure to such risks and manages them by means of derivative financial instruments, in accordance with its risk management guidelines. To mitigate interest rate volatility risk and simultaneously ensure a correct balance between fixed rate debt and variable rate debt, the Group has stipulated interest rate derivatives in relation to a portion of its financial liabilities. At the same time, to mitigate exchange rate volatility risk, the Group has signed foreign exchange derivatives to fully hedge loans in foreign currencies. Under these guidelines, derivative financial instruments may only be used to manage its exposure to interest and exchange rate fluctuations related to cash flows and balance sheet assets and liabilities. . These policies do not enable speculative activities to be carried out. Market risk and currency risk on commercial operations Concerning the wholesale business carried on by Hera Trading Srl, the Group manages risks related to the misalignment between indexation formulas related to the purchase of gas and electric energy and the indexation formulas related to the sales of the same commodities (including contracts entered into at fixed prices) as well as exchange rate risks in case the trading contracts for the commodities are denominated in currencies other than the euro (U.S. dollar). In relation to these risks, the Group has set up a number of instruments, including different types of commodity derivatives (which may also include physical delivery) aimed at pre-establishing the effects on sales margins irrespective of changes in market conditions. The organisational model adopted and the supporting management systems make it possible to identify the nature of the operation (hedging vs. trading) and produce the information required for a formal identification of the purpose of these instruments. Specifically, from a managerial standpoint, the Group identified a commercial portfolio, including contracts signed to manage the Group\u2019s procurement activities, and a trading portfolio, including instruments whose purpose cannot be strictly related to the underlying procurement activities. For an exhaustive discussion of how the Group analyses, measures, monitors and manages exposure to these risks, please refer to paragraph 1.02.03 \u201cRisk areas: identification and management of risk factors\u201d in the management report. ", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialRiskManagementExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-413": { "value": "Credit risk The credit risk faced by the Group originates from the broad structure of the client portfolios in the main business areas in which it operates; for the same reason, this risk is spread out over a large number of clients. In order to manage the credit risk, the Group established procedures for selecting, monitoring and evaluating its customer portfolio. The Italian market is the benchmark market. The Group\u2019s credit management model makes it possible to analytically determine the different risks associated with the collectability of trade receivables as soon as they arise and progressively according to their increasing seniority. This approach allows the company to reduce the concentration and exposure to credit risk posed by both business and household customers. With regard to receivables from small-sized customers, write-downs are carried out on the basis of future-oriented analysis regarding the amount of probable future income, taking into consideration the seniority of the receivables, the type of recovery action undertaken and the status of the creditor. From time to time, analyses are conducted on the individual credit positions yet to be resolved, identifying any criticality, and if the amounts outstanding are uncollectible, in whole or in part, the related receivables are written down.", "dimensions": { "concept": "ifrs-full:DisclosureOfCreditRiskExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-38": { "value": "The Group\u2019s credit management model makes it possible to analytically determine the different risks associated with the collectability of trade receivables as soon as they arise and progressively according to their increasing seniority. This approach allows the company to reduce the concentration and exposure to credit risk posed by both business and household customers. With regard to receivables from small-sized customers, write-downs are carried out on the basis of future-oriented analysis regarding the amount of probable future income, taking into consideration the seniority of the receivables, the type of recovery action undertaken and the status of the creditor. From time to time, analyses are conducted on the individual credit positions yet to be resolved, identifying any criticality, and if the amounts outstanding are uncollectible, in whole or in part, the related receivables are written down.", "dimensions": { "concept": "ifrs-full:ExplanationOfCreditRiskManagementPracticesAndHowTheyRelateToRecognitionAndMeasurementOfExpectedCreditLossesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-415": { "value": "Liquidity risk Liquidity risk concerns the inability to meet the financial obligations taken on due to a lack of internal resources or an inability to find external resources at acceptable costs. Liquidity risk is mitigated by adopting policies and procedures that maximise the efficiency of management of financial resources. For the most part, this is accomplished through the centralised management of cash inflows and outflows (centralised treasury service); in the prospective assessment of the liquidity conditions; in obtaining adequate lines of credit; and preserving an adequate amount of liquidity. The financial planning of requirements, focused on medium-term borrowings, and the availability of abundant funds in credit facilities, allow effective management of liquidity risk. ", "dimensions": { "concept": "ifrs-full:DisclosureOfLiquidityRiskExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-40": { "value": "Liquidity risk is mitigated by adopting policies and procedures that maximise the efficiency of management of financial resources. For the most part, this is accomplished through the centralised management of cash inflows and outflows (centralised treasury service); in the prospective assessment of the liquidity conditions; in obtaining adequate lines of credit; and preserving an adequate amount of liquidity. The financial planning of requirements, focused on medium-term borrowings, and the availability of abundant funds in credit facilities, allow effective management of liquidity risk. ", "dimensions": { "concept": "ifrs-full:DescriptionOfManagingLiquidityRisk", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-39": { "value": "Concerning the wholesale business carried on by Hera Trading Srl, the Group manages risks related to the misalignment between indexation formulas related to the purchase of gas and electric energy and the indexation formulas related to the sales of the same commodities (including contracts entered into at fixed prices) In relation to these risks, the Group has set up a number of instruments, including different types of commodity derivatives (which may also include physical delivery) aimed at pre-establishing the effects on sales margins irrespective of changes in market conditions. The organisational model adopted and the supporting management systems make it possible to identify the nature of the operation (hedging vs. trading) and produce the information required for a formal identification of the purpose of these instruments. Specifically, from a managerial standpoint, the Group identified a commercial portfolio, including contracts signed to manage the Group\u2019s procurement activities, and a trading portfolio, including instruments whose purpose cannot be strictly related to the underlying procurement activities. ", "dimensions": { "concept": "ifrs-full:DisclosureOfMarketRiskExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-414": { "value": "Significant estimates and valuations Preparation of the consolidated financial statements and related notes requires the use of estimates and valuations by the directors, with effects on the balance sheet figures, based on historical data and on the forecasts of specific events that are reasonably likely to occur on the basis of currently available information. These estimates, by definition, are an approximation of the final figures. Hence the main areas characterised by valuations and assumptions that could give rise to variations in the values of assets and liabilities by the next accounting period are set forth below. Specifically, information is provided on the nature of these estimates and the assumptions on which they have been based, with indication of the reference book values. Recognition of revenues Revenues for the sale of electricity, gas and water are recognised and accounted for at supply only if the consideration is expected to be collected. They include the allocation for services rendered between the date of the last reading and the end of the financial year, but not yet billed. This allocation is based on estimated of the customer\u2019s daily consumption, based on the historic profile, adjusted to reflect the weather conditions or other factors which might affect consumption under evaluation. Provisions for risks These provisions were made by adopting the same procedures as in previous years, with reference to reports by the legal advisors and consultants that are following the cases, and on the basis of developments in the relevant legal proceedings as well as of the updates of the hypotheses concerning future expenses for post-mortem costs of the landfills, following the revision of the estimated costs identified by external consultants. Depreciation Depreciation is calculated on the basis of the useful life of an asset. The useful life is determined by Management at the time the asset is recognized in the balance sheet; valuations of the duration of useful life are based on historical experience, market conditions and the expectation of future events that could affect the useful life itself, including technological changes. Therefore, the actual useful life might differ from the estimated useful life. Impairment test The Group carries out an analysis of the recoverable value of goodwill as well as of its investment (not majority investment) in companies holding assets for generating thermoelectric energy, through impairment tests, at least once a year. This test is based on the calculation of its value in use, which requires the use of estimates as specified in note 27 of the comments to the financial statement formats. Deferred tax assets Accounting for deferred tax assets takes place on the basis of expectations of taxable income in future years. The evaluation of the taxable income expected for the purposes of accounting for deferred tax assets depends on factors that may vary over time and significantly affect the recoverability of deferred tax assets. Fair value assessment and evaluation process The fair value of financial instruments, both on interest rates and foreign exchange rates, derives from market prices. In the absence of prices quoted in active markets, the method of discounting back future cash flows is used, taking the parameters observed on the market as reference. The fair value of contracts on commodities are determined using directly observable market inputs, where available. The methodology for calculating the fair value of these instruments includes the assessment of the non- performance risk, where relevant. All derivative contracts entered into by the Group are with leading institutional counterparties. Fair Value Hierarchy The financial instruments measured at fair value are classified through a three-level hierarchy based on the way the fair value was determined, i.e., with reference to the factors used in determining the value: \u25aa level 1, financial instruments the fair value of which is determined on the basis of quoted prices in active markets; \u25aa level 2, financial instruments the fair value of which is determined using valuation techniques that employ parameters that are directly or indirectly observable on the market. Instruments valued on the basis of the market forward curve and short term differential contracts are classified in this category; \u25aa level 3, financial instruments the fair value of which is determined using valuation techniques that employ parameters that cannot be observed on the market, using internal estimates exclusively.", "dimensions": { "concept": "ifrs-full:DisclosureOfAccountingJudgementsAndEstimatesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-41": { "value": "Fair value assessment and evaluation process The fair value of financial instruments, both on interest rates and foreign exchange rates, derives from market prices. In the absence of prices quoted in active markets, the method of discounting back future cash flows is used, taking the parameters observed on the market as reference. The fair value of contracts on commodities are determined using directly observable market inputs, where available. The methodology for calculating the fair value of these instruments includes the assessment of the non- performance risk, where relevant. All derivative contracts entered into by the Group are with leading institutional counterparties. Fair Value Hierarchy The financial instruments measured at fair value are classified through a three-level hierarchy based on the way the fair value was determined, i.e., with reference to the factors used in determining the value: \u25aa level 1, financial instruments the fair value of which is determined on the basis of quoted prices in active markets; \u25aa level 2, financial instruments the fair value of which is determined using valuation techniques that employ parameters that are directly or indirectly observable on the market. Instruments valued on the basis of the market forward curve and short term differential contracts are classified in this category; \u25aa level 3, financial instruments the fair value of which is determined using valuation techniques that employ parameters that cannot be observed on the market, using internal estimates exclusively.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFairValueMeasurementExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-501": { "value": "The financial results for the year by comparison with the previous year are outlined below. notes 2022 2021 Revenues 1 20,082.0 10,555.3 Other operating revenues 2 548.2 400.1 Raw materials and materials 3 (16,730.0) (6,668.5) Service costs 4 (2,105.8) (2,464.6) Personnel costs 5 (601.1) (592.8) Other operating costs 6 (74.9) (66.5) Capitalised costs 7 82.5 60.8 EBITDA 1,200.9 1,223.8 Amortisation, provisions and depreciation 8 (667.1) (612.1) Operating revenues 533.8 611.7 Share of profits (losses) pertaining to joint ventures and associated companies 9 10.0 13.2 Financial income 10 82.2 82.3 Financial expenses 11 (217.2) (300.3) Financial management (125.0) (204.8) Earnings before taxes 408.8 406.9 A breakdown of the most significant economic items by business sector is provided in the section \u201cReporting by operational sector\u201d under 2.02.10 \u201cOther Information.\u201d Operating revenues and costs showed a significant increase during the year, due mainly to the significant increase in energy commodity prices in the reference markets, as well as the change in the scope of customers served in the energy-sector markets of last resort. The Group EBITDA is an alternative indicator of performance the definition of which can be found in Section 1.04 \u201cOverview of operating and financial trends and definition of alternative performance measures.\u201d It was positive in the amount of 1,200.9 million euro, and it decreased as compared to last year mainly due to the more subdued performance of the electricity business, which suffered from the particularly variable conditions of the wholesale market and did not benefit in the 2022 financial year, unlike the previous year, from the contribution of the dispatching services market. This effect was only partially offset by the better results achieved by the waste management business. \u201cAmortization, provisions and depreciation\u201d increased both as a result of investments entering into depreciation and amortization during the year, and as a result of higher allocations to the provision for bad debts and the provisions for risks and charges. The significant change in financial management is affected by various events occurring in the current and previous fiscal years. In the second part of the 2022 fiscal year, the Group underwrote short- to medium-term loans and short-term cash lines to meet contingent financial needs, particularly related to the increase in methane gas storage needed to supply its customers for the 2022-2023 thermal year. On the other hand, during 2021, it is worth mentioning the operation of renegotiating five bonds, which resulted in the recognition of charges amounting to 82.6 million euro. ", "dimensions": { "concept": "ifrs-full:DisclosureOfProfitLossFromOperatingActivitiesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-433": { "value": "1 Revenues 2022 2021 Change Revenues from sales and services 19,871.3 10,377.1 9,494.2 Changes in work in progress and semi-finished products 210.7 178.2 32.5 Total 20,082.0 10,555.3 9,526.7 Due to the particular types of activities that the Group oversees, \u201cRevenues from sales and services\u201d include substantial allocations for services provided to end customers and not yet invoiced as of the financial statement date. Below are the values of invoices to be issued pertaining to the reference period in relation to the three commodities most significantly impacted by the estimated year-end accruals. 2022 2021 Change Gas sales 730.2 447.1 283.1 Electricity sales 371.3 283.8 87.5 Water 159.8 132.2 27.6 Total 1,261.3 863.1 398.2 The breakdown of revenues from sales and services by geographical area is shown below. 2022 2021 Change Italy 14,102.2 7,873.9 6,228.3 European Union 2,874.3 924.3 1,950.0 Outside European Union 2,894.8 1,578.9 1,315.9 Total 19,871.3 10,377.1 9,494.2 The revenues generated outside Italy mainly refer to natural gas brokerage activities, the value of which amounted to 5,617.8 million euro at 31 December 2022 (2,405.6 million at 31 December 2021). It should also be noted that, of the total value of revenues, 4,064.6 million refer to counterparties operating in the Dutch TTF market (1,577.4 million at 31 December 2021). For \u201cChanges in work in progress and semi-finished products\u201d, the increase compared to the previous year is mainly attributable to the energy efficiency works the Group carried out for customers, mainly apartment blocks; this business area, developed in line with strategic choices associated with the fight against climate change, increased significantly in the 2022 financial year as well. Revenues from related parties are presented in note no. 2.03.01 \u201cIncome statement as per Consob resolution 15519/ 2006\u201d. ", "dimensions": { "concept": "ifrs-full:DisclosureOfRevenueExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-461": { "value": "
Due to the particular types of activities that the Group oversees, \u201cRevenues from sales and services\u201d
include substantial allocations for services provided to end customers and not yet invoiced as of the
financial statement date. Below are the values of invoices to be issued pertaining to the reference period
in relation to the three commodities most significantly impacted by the estimated year-end accruals.
2022
2021
Change
Gas sales
730.2
447.1
283.1
Electricity sales
371.3
283.8
87.5
Water
159.8
132.2
27.6
Total
1,261.3
863.1
398.2
", "dimensions": { "concept": "ifrs-full:ExplanationOfAssumptionAboutFutureWithSignificantRiskOfResultingInMaterialAdjustments", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-42": { "value": "The breakdown of revenues from sales and services by geographical area is shown below. 2022 2021 Change Italy 14,102.2 7,873.9 6,228.3 European Union 2,874.3 924.3 1,950.0 Outside European Union 2,894.8 1,578.9 1,315.9 Total 19,871.3 10,377.1 9,494.2 The revenues generated outside Italy mainly refer to natural gas brokerage activities, the value of which amounted to 5,617.8 million euro at 31 December 2022 (2,405.6 million at 31 December 2021). It should also be noted that, of the total value of revenues, 4,064.6 million refer to counterparties operating in the Dutch TTF market (1,577.4 million at 31 December 2021).", "dimensions": { "concept": "ifrs-full:DisclosureOfGeographicalAreasExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-432": { "value": "2 Other operating revenues 2022 2021 Change Long-term contracts 397.6 341.9 55.7 Operating grants 52.9 26.9 26.0 Grants related to plants 12.8 12.4 0.4 Gains from asset disposals 0.9 1.2 (0.3) Other revenues 84.0 17.7 66.3 Total 548.2 400.1 148.1 \u201cLong-term contracts\u201d include revenues generated from the construction or improvement of infrastructures held in concession as per the application of the accounting model for intangible assets for public services held under concession. \u201cOperating grants\u201d increased as a result of gas and electricity subsidies, amounting to 38 million euro, recognized in the form of tax credits by the series of governmental aid decrees issued over the course of 2022 to deal with the high energy costs emergency. The remaining part mainly include Fer incentives recognised by the GSE for energy produced from renewable sources and grants awarded by public bodies, authorities or institutions for specific projects and activities carried out by the Group. \u201cGrants related to plants\u201d represent the proceeds for the period associated with the depreciation rate of the assets subject to grants. \u201cOther revenues\u201d mainly consist of insurance reimbursements, recovery of fees and white certificates. White certificates represent the revenues calculated on the basis of energy efficiency objectives as established by the GSE and regulated in relation to the Cassa per i Servizi Energetici e Ambientali, amounting to 14.5 million euro at 31 December 2022. The change from the comparison period is mainly due to the negative adjustment of white certificate revenue recognized at 31 December 2021 in compliance with the provisions introduced in May 2021, which both set a significantly lower number of certificates for the 2021 obligation than in previous periods and retroactively reduced the number of certificates planned for the 2020 obligation year by 60%. ", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherOperatingIncomeExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-460": { "value": "2 Other operating revenues 2022 2021 Change Long-term contracts 397.6 341.9 55.7 Operating grants 52.9 26.9 26.0 Grants related to plants 12.8 12.4 0.4 Gains from asset disposals 0.9 1.2 (0.3) Other revenues 84.0 17.7 66.3 Total 548.2 400.1 148.1 \u201cLong-term contracts\u201d include revenues generated from the construction or improvement of infrastructures held in concession as per the application of the accounting model for intangible assets for public services held under concession. \u201cOperating grants\u201d increased as a result of gas and electricity subsidies, amounting to 38 million euro, recognized in the form of tax credits by the series of governmental aid decrees issued over the course of 2022 to deal with the high energy costs emergency. The remaining part mainly include Fer incentives recognised by the GSE for energy produced from renewable sources and grants awarded by public bodies, authorities or institutions for specific projects and activities carried out by the Group. \u201cGrants related to plants\u201d represent the proceeds for the period associated with the depreciation rate of the assets subject to grants. \u201cOther revenues\u201d mainly consist of insurance reimbursements, recovery of fees and white certificates. White certificates represent the revenues calculated on the basis of energy efficiency objectives as established by the GSE and regulated in relation to the Cassa per i Servizi Energetici e Ambientali, amounting to 14.5 million euro at 31 December 2022. The change from the comparison period is mainly due to the negative adjustment of white certificate revenue recognized at 31 December 2021 in compliance with the provisions introduced in May 2021, which both set a significantly lower number of certificates for the 2021 obligation than in previous periods and retroactively reduced the number of certificates planned for the 2020 obligation year by 60%. 6 Other operating costs 2022 2021 Change Taxation other than income taxes 23.3 21.7 1.6 Fees paid to Institutional Authorities 13.3 13.1 0.2 Losses on the sale and disposal of assets 9.2 9.2 \u2010 Minor charges 29.1 22.5 6.6 Total 74.9 66.5 8.4 \u201cTaxation other than income taxes\u201d mainly relate to taxes on buildings, stamp duties and registration fees, public area occupation fee, fees related to the landfills managed and excise duties. \u201cFees paid to Institutional authorities\u201d paid to the regions, land reclamation consortia, sector agencies and mountain-area communities, mainly regarding the withdrawal and use of water, as well as maintenance and management costs for hydraulic works. The item also includes fees for the safeguarding of hydrogeological protection areas in mountain municipalities (as provided for by Regional government decree 933/2012) and fees paid for the operation of Atersir. \u201cLosses on the sale and disposal of assets\u201d are mainly composed of divestments that occurred in the operation of waste treatment plants, gas distribution network meters and facilities serving the integrated water cycle. \u201cMinor charges\u201d comprise other residual items including membership fees, indemnities, sanctions and fines. ", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherOperatingIncomeExpenseExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-43": { "value": "\u201cOperating grants\u201d increased as a result of gas and electricity subsidies, amounting to 38 million euro, recognized in the form of tax credits by the series of governmental aid decrees issued over the course of 2022 to deal with the high energy costs emergency. The remaining part mainly include Fer incentives recognised by the GSE for energy produced from renewable sources and grants awarded by public bodies, authorities or institutions for specific projects and activities carried out by the Group. \u201cGrants related to plants\u201d represent the proceeds for the period associated with the depreciation rate of the assets subject to grants.", "dimensions": { "concept": "ifrs-full:DisclosureOfGovernmentGrantsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-442": { "value": "3 Raw materials and materials 2022 2021 Change Raw materials earmarked for sale 16,725.0 6,612.1 10,112.9 Plastic materials 93.6 65.8 27.8 Materials for industrial use 41.4 35.9 5.5 Environmental certificates 35.1 (23.5) 58.6 Charges and revenues from derivatives (371.4) (175.7) (195.7) Maintenance and other materials 206.3 153.9 52.4 Total 16,730.0 6,668.5 10,061.5 \u201cRaw materials earmarked for sale\u201d, net of changes in stocks, include supplies of natural gas, electricity and water. The natural gas brokerage business on the Dutch TTF market generated costs of 4,364.9 million euro (1,690.3 million euro at 31/12/2021). The increase in the period is driven by the sharp rise in energy commodity supply prices to which is added the increase in volumes marketed to electricity end customers. These effects are only partially offset by the decrease in total gas volumes purchased by the Group in the 2022 financial year, in relation to the significant reduction in brokering activities in wholesale markets, only partially mitigated by the higher volumes handled in the gas markets of last resort and the awarding of Consip tenders. \u201cPlastic materials\u201d, net of changes in stocks, include the cost of purchasing plastic raw materials destined for subsequent processing, transformation and sales as part of the Aliplast Spa company activities. The change in costs is consistent with the increase in sales revenue due to the performance of the plastics market which showed a significant price increase for both virgin and, to a larger degree, recycled polymer as compared to the same period of the previous year. \u201cMaterials for industrial use\u201d mainly include the procurement of methane gas and electricity to power the Group\u2019s production plants, as well as the purchase of fuels and lubricants for fleet management. \u201cEnvironmental certificates\u201d include the purchase cost of white certificates, which are supplied in accordance with the obligations assigned to the distribution companies. This item also includes the environmental certificates in stock, mainly made up of white and grey certificates as well as the valorisation of commitments for purchasing electricity from renewable sources in relation to contracts signed with end customers and greenhouse gas emission allowance trading contracts. The significant change from the previous fiscal year is due to the income recorded in 2021 in correlation with the reduction of the liability for the 2020 obligation that the legislature retroactively applied, as described in Note 2 \u201cOther operating revenues\u201d. \u201cMaintenance and other materials\u201d, net of changes in stocks, mainly include consumables used in the management of the Group\u2019s operating activities and, marginally, products purchased to be resold to end customers. The significant increase in the period was due to both the effect of higher material sourcing costs and the greater volume of concession business carried out by the Group, particularly with regard to the urban sanitation concessions in the Bologna and Modena areas, as well as the development of the photovoltaic business. In relation to \u201cCharges and revenues from derivatives\u201d, please see note 29 \u201cDerivative instruments\u201d for an analysis of the nature and performance of these items. 4 Service costs 2022 2021 Change Work and maintenance expenses 872.2 646.3 225.9 Waste transportation, disposal and collection 467.6 398.9 68.7 Transport and storage 269.3 1,008.7 (739.4) Technical services 119.6 65.9 53.7 IT and data processing services 65.5 67.8 (2.3) Fees paid to local authorities 61.7 64.9 (3.2) Professional services 43.5 40.8 2.7 Other service costs 206.4 171.3 35.1 Total 2,105.8 2,464.6 (358.8) \u201cWork and maintenance expenses\u201d refer to the costs for the construction or improvement of infrastructures under concession pursuant to the application of the accounting model for intangible assets for public services held under concession, the costs of implementing energy efficiency measures, and the costs for maintaining the plants managed by the Group. The change from the previous period is due mainly to the significant development of the business related to energy efficiency improvement work on apartment buildings. \u201cWaste transportation, disposal and collection\u201d mainly include the operating costs of urban hygiene and waste disposal activities. The change from the previous year is the result of both the higher per-unit cost of services due to the increase in energy commodity prices in general and fuel prices, in particular, and higher volumes handled, due in part to the acquisition transactions carried out in the second half of the 2021 financial year and in the 2022 financial year. \u201cTransport and storage\u201d include the costs of transporting and storing gas as well as the costs of distributing gas and electricity distribution, including system charges. The latter, in particular, represent cost components charged to end customers and therefore not substantially affecting the Group\u2019s results. The change from last year is mainly attributable to the negative value of system charges. The substantial reduction in this item compared to the previous year is due to: \u25aa regulatory provisions that, to cope with high utility bills driven by sudden rises in energy commodity prices, starting back in October 2021 and amplified in the following quarters of 2022, introduced a cancellation of general system charges in the electricity sector applied to specific utilities and significantly reduced the gas distribution components; \u25aa the increase in gas and electricity social bonuses credited to certain categories of end customers in the 2022 financial year. the regulatory provision, in particular, brought about the expansion of the base of users eligible for rebates, the increase (especially in the last quarter of 2022) of the unit value of applicable social bonuses, and the introduction of an additional negative rate for the UG2c component, starting in April 2022, as established by ARERA Resolution 148/2022/R/gas. These effects are only partially offset by the increase in gas transportation costs due to the increased capacity used by the Group in the 2022 financial year. \u201cTechnical services\u201d mainly include the costs incurred in carrying out energy efficiency improvement work on apartment buildings, an area that has grown significantly compared to the previous period. \u201cIT and data processing services\u201d include costs for maintaining and managing the Group\u2019s IT and telecommunications infrastructure, as well as corporate applications and cybersecurity systems. The item \u201cFees paid to local authorities\u201d includes the charges incurred for the use of public owned networks, fees paid to companies that own these assets for the rent of gas, water and electricity cycle assets. It also includes, marginally, the fees paid for the use of telecommunications and district heating networks. \u201cProfessional services\u201d include charges for commercial, legal, notary, administrative and tax services. This item includes fees paid for the audit of financial statements and the issuance of certifications. \u201cOther service costs\u201d include all other costs for services not specified in the above categories. This item also includes commissions to agents totalling 21.4 million euro (15.5 million euro at of 31 December 2021) and bank commissions in the amount of 15.2 million euro (8.7 million euro at 31 December 2021). It should also be noted that the item \u201cOther service costs\u201d also includes the instalments relating to short- term leases and low-value leases, the amount of which is not significant for the 2022 financial period. 5 Personnel costs 2022 2021 Change Salaries and wages 423.0 415.7 7.3 Social security costs 136.7 133.0 3.7 Other costs 41.4 44.1 (2.7) Total 601.1 592.8 8.3 The increase as compared to the previous year is mainly connected to: \u25aa the increase in the number of employees, particularly as a result of new acquisitions during 2022 and in the second half of the previous year; \u25aa salary increases provided for in national collective labour agreements. These effects are partially offset by lower average staff attendance in the 2022 financial year and lower expenses incurred for termination than in the previous year. The average and specific number of employees for the period in question, analysed by category, is as follows: Average Specific 2022 2021 Change 2022 2021 Change Managers 154 154 \u2010 153 154 (1) Middle managers 580 572 9 593 583 10 Clerks 5,276 5,236 40 5,251 5,197 54 Blue-collar workers 3,441 3,427 14 3,418 3,401 17 Total 9,451 9,389 62 9,415 9,335 80 The average cost of labour per capita for 2022 as compared to the 2021 financial period is as follows: thousand euro 2022 2021 Change Average cost of labour pro person 64.0 63.0 1.0 6 Other operating costs 2022 2021 Change Taxation other than income taxes 23.3 21.7 1.6 Fees paid to Institutional Authorities 13.3 13.1 0.2 Losses on the sale and disposal of assets 9.2 9.2 \u2010 Minor charges 29.1 22.5 6.6 Total 74.9 66.5 8.4 \u201cTaxation other than income taxes\u201d mainly relate to taxes on buildings, stamp duties and registration fees, public area occupation fee, fees related to the landfills managed and excise duties. \u201cFees paid to Institutional authorities\u201d paid to the regions, land reclamation consortia, sector agencies and mountain-area communities, mainly regarding the withdrawal and use of water, as well as maintenance and management costs for hydraulic works. The item also includes fees for the safeguarding of hydrogeological protection areas in mountain municipalities (as provided for by Regional government decree 933/2012) and fees paid for the operation of Atersir. \u201cLosses on the sale and disposal of assets\u201d are mainly composed of divestments that occurred in the operation of waste treatment plants, gas distribution network meters and facilities serving the integrated water cycle. \u201cMinor charges\u201d comprise other residual items including membership fees, indemnities, sanctions and fines. 7 Capitalised costs 2022 2021 Change Increase of self-constructed assets 82.5 60.8 21.7 This item includes mainly the labour costs and other charges (such as storage materials and costs for use of equipment) directly attributable to the Group\u2019s self-constructed assets.", "dimensions": { "concept": "ifrs-full:DisclosureOfExpensesByNatureExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-462": { "value": "4 Service costs 2022 2021 Change Work and maintenance expenses 872.2 646.3 225.9 Waste transportation, disposal and collection 467.6 398.9 68.7 Transport and storage 269.3 1,008.7 (739.4) Technical services 119.6 65.9 53.7 IT and data processing services 65.5 67.8 (2.3) Fees paid to local authorities 61.7 64.9 (3.2) Professional services 43.5 40.8 2.7 Other service costs 206.4 171.3 35.1 Total 2,105.8 2,464.6 (358.8) \u201cWork and maintenance expenses\u201d refer to the costs for the construction or improvement of infrastructures under concession pursuant to the application of the accounting model for intangible assets for public services held under concession, the costs of implementing energy efficiency measures, and the costs for maintaining the plants managed by the Group. The change from the previous period is due mainly to the significant development of the business related to energy efficiency improvement work on apartment buildings. \u201cWaste transportation, disposal and collection\u201d mainly include the operating costs of urban hygiene and waste disposal activities. The change from the previous year is the result of both the higher per-unit cost of services due to the increase in energy commodity prices in general and fuel prices, in particular, and higher volumes handled, due in part to the acquisition transactions carried out in the second half of the 2021 financial year and in the 2022 financial year. \u201cTransport and storage\u201d include the costs of transporting and storing gas as well as the costs of distributing gas and electricity distribution, including system charges. The latter, in particular, represent cost components charged to end customers and therefore not substantially affecting the Group\u2019s results. The change from last year is mainly attributable to the negative value of system charges. The substantial reduction in this item compared to the previous year is due to: \u25aa regulatory provisions that, to cope with high utility bills driven by sudden rises in energy commodity prices, starting back in October 2021 and amplified in the following quarters of 2022, introduced a cancellation of general system charges in the electricity sector applied to specific utilities and significantly reduced the gas distribution components; \u25aa the increase in gas and electricity social bonuses credited to certain categories of end customers in the 2022 financial year. the regulatory provision, in particular, brought about the expansion of the base of users eligible for rebates, the increase (especially in the last quarter of 2022) of the unit value of applicable social bonuses, and the introduction of an additional negative rate for the UG2c component, starting in April 2022, as established by ARERA Resolution 148/2022/R/gas. These effects are only partially offset by the increase in gas transportation costs due to the increased capacity used by the Group in the 2022 financial year. \u201cTechnical services\u201d mainly include the costs incurred in carrying out energy efficiency improvement work on apartment buildings, an area that has grown significantly compared to the previous period. \u201cIT and data processing services\u201d include costs for maintaining and managing the Group\u2019s IT and telecommunications infrastructure, as well as corporate applications and cybersecurity systems. The item \u201cFees paid to local authorities\u201d includes the charges incurred for the use of public owned networks, fees paid to companies that own these assets for the rent of gas, water and electricity cycle assets. It also includes, marginally, the fees paid for the use of telecommunications and district heating networks. \u201cProfessional services\u201d include charges for commercial, legal, notary, administrative and tax services. This item includes fees paid for the audit of financial statements and the issuance of certifications. \u201cOther service costs\u201d include all other costs for services not specified in the above categories. This item also includes commissions to agents totalling 21.4 million euro (15.5 million euro at of 31 December 2021) and bank commissions in the amount of 15.2 million euro (8.7 million euro at 31 December 2021). It should also be noted that the item \u201cOther service costs\u201d also includes the instalments relating to short- term leases and low-value leases, the amount of which is not significant for the 2022 financial period. ", "dimensions": { "concept": "ifrs-full:DisclosureOfExpensesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-434": { "value": "5 Personnel costs 2022 2021 Change Salaries and wages 423.0 415.7 7.3 Social security costs 136.7 133.0 3.7 Other costs 41.4 44.1 (2.7) Total 601.1 592.8 8.3 The increase as compared to the previous year is mainly connected to: \u25aa the increase in the number of employees, particularly as a result of new acquisitions during 2022 and in the second half of the previous year; \u25aa salary increases provided for in national collective labour agreements. These effects are partially offset by lower average staff attendance in the 2022 financial year and lower expenses incurred for termination than in the previous year. The average and specific number of employees for the period in question, analysed by category, is as follows: Average Specific 2022 2021 Change 2022 2021 Change Managers 154 154 \u2010 153 154 (1) Middle managers 580 572 9 593 583 10 Clerks 5,276 5,236 40 5,251 5,197 54 Blue-collar workers 3,441 3,427 14 3,418 3,401 17 Total 9,451 9,389 62 9,415 9,335 80 The average cost of labour per capita for 2022 as compared to the 2021 financial period is as follows: thousand euro 2022 2021 Change Average cost of labour pro person 64.0 63.0 1.0", "dimensions": { "concept": "ifrs-full:DisclosureOfEmployeeBenefitsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-44": { "value": "The average and specific number of employees for the period in question, analysed by category, is as follows: Average Specific 2022 2021 Change 2022 2021 Change Managers 154 154 \u2010 153 154 (1) Middle managers 580 572 9 593 583 10 Clerks 5,276 5,236 40 5,251 5,197 54 Blue-collar workers 3,441 3,427 14 3,418 3,401 17 Total 9,451 9,389 62 9,415 9,335 80 ", "dimensions": { "concept": "ifrs-full:DisclosureOfInformationAboutEmployeesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-45": { "value": "6 Other operating costs 2022 2021 Change Taxation other than income taxes 23.3 21.7 1.6 Fees paid to Institutional Authorities 13.3 13.1 0.2 Losses on the sale and disposal of assets 9.2 9.2 \u2010 Minor charges 29.1 22.5 6.6 Total 74.9 66.5 8.4 \u201cTaxation other than income taxes\u201d mainly relate to taxes on buildings, stamp duties and registration fees, public area occupation fee, fees related to the landfills managed and excise duties. \u201cFees paid to Institutional authorities\u201d paid to the regions, land reclamation consortia, sector agencies and mountain-area communities, mainly regarding the withdrawal and use of water, as well as maintenance and management costs for hydraulic works. The item also includes fees for the safeguarding of hydrogeological protection areas in mountain municipalities (as provided for by Regional government decree 933/2012) and fees paid for the operation of Atersir. \u201cLosses on the sale and disposal of assets\u201d are mainly composed of divestments that occurred in the operation of waste treatment plants, gas distribution network meters and facilities serving the integrated water cycle. \u201cMinor charges\u201d comprise other residual items including membership fees, indemnities, sanctions and fines. ", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherOperatingExpenseExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-486": { "value": "8 Depreciation amortisation and provisions 2022 2021 Change Depreciation and amortisation 478.6 469.9 8.7 Net provisions 188.5 142.2 46.3 Total 667.1 612.1 55.0 The details of the item Depreciation and amortisation are as follows: Notes 2022 2021 Change Depreciation 21, 22, 23 477.1 463.3 13.8 Write-downs 21, 22, 23 1.5 6.6 (5.1) Total 478.6 469.9 8.7 Depreciation includes the depreciation of tangible assets, rights of use and intangible assets. Write-downs refer mainly to waste treatment business assets. The details of the item Net provisions are as follows: Notes 2022 2021 Change Provisions to the bad debts fund 33 133.9 94.4 39.5 Provisions to risks and charge funds 31 66.6 52.0 14.6 De-provisioning 31, 33 (12.0) (4.2) (7.8) Total 188.5 142.2 46.3 Provisions include value adjustments to the bad debts fund and provisions for risks and charges. De-provisioning includes the re-verification of funds in view of the fact that the underlying risks no longer exist. 31 Provisions for risks and charges Opening balance Provisions Financial expenses Uses Other movements Changes in the scope of consolidation Closing balance 31 Dec 21 Provision third-party asset restoration 232.2 9.2 5.4 \u2010 (39.3) \u2010 207.5 Provision for closure and post- closure landfill expenses 179.0 5.6 13.2 (17.5) 2.3 \u2010 182.6 Provision for personnel legal cases and disputes 14.5 3.1 \u2010 (5.8) (1.1) \u2010 10.7 Provisions for waste disposal 6.7 7.2 \u2010 (6.4) \u2010 0.6 8.1 Provision for plants dismantling 5.9 \u2010 0.1 \u2010 \u2010 \u2010 6.0 Other provisions for risks and charges 99.9 28.0 \u2010 (1.5) (14.9) 1.6 113.1 Total 538.2 53.1 18.7 (31.2) (53.0) 2.2 528.0 31 Dec 22 Provision third-party asset restoration 207.5 6.3 4.1 \u2010 \u2010 \u2010 217.9 Provision for closure and post- closure landfill expenses 182.6 6.0 8.0 (13.5) 3.2 \u2010 186.3 Provision for personnel legal cases and disputes 10.7 2.4 \u2010 (1.3) (1.0) 0.1 10.9 Provisions for waste disposal 8.1 9.3 \u2010 (7.6) (0.1) \u2010 9.7 Provision for plants dismantling 6.0 \u2010 0.1 \u2010 \u2010 \u2010 6.1 Other provisions for risks and charges 113.1 44.0 \u2010 (5.6) (16.8) \u2010 134.7 Total 528.0 68.0 12.2 (28.0) (14.7) 0.1 565.6 The \u201cProvision for third-party asset restoration\u201d includes provisions made in relation to law and contractual requirements for the Group companies as lessees of the distribution networks of the entity that owns the assets. The allocations are made on the basis of depreciation rates held to be representative of the remaining useful life of the assets in question in order to compensate the owner companies for the wear and tear of the assets used for business activities. The provision reflects the present value of these outlays which will be determined in future periods (usually on expiry of the agreements entered into with the area agencies, as far as the water service is concerned, and on expiry of the transitory period anticipated by current legislation as far as gas distribution is concerned). The increases in the provision comprise the sum total of the provisions for the year, including those discounted to present value, and the financial charges for the period associated with the cash flows discounted to present value. The decrease in provisions compared to the previous year is mainly affected by the end of the extended management of the water service in the province of Rimini at 31 December 2021. The tender, which was also awarded to the Hera Group, stipulates that the assets are to remain under the management of the owner companies and are therefore not to be entrusted to the operator. The decrease in financial expenses compared to the previous period is determined by the annual update of the parameters used to reflect current market conditions (Wacc). The \u201cProvision for landfill closure and post-closure expenses\u201d represents the amount set aside to cover the costs which will have to be incurred for the management of the closure and post-closure period pertaining to the landfills currently managed. The future outlays, calculated for each landfill by means of a specific appraisal, have been discounted to present value. The increases in the provision comprise the financial component derived from the discounting process and provisions due to changes in the assumptions about future outlays, following the change in expert estimates on closed landfills. Financial expenses decreased compared to the previous year due to the different effects arising from the yearly update of the parameters used to reflect current market conditions (Wacc), as well as the revision of the assumptions on the timing of future disbursements. Uses represent actual disbursements that occurred during the year, while are \u201cOther movements\u201d mainly includes estimated closure and post- closure costs in relation to newly constructed landfills and the changes in the estimated closure and post- closure costs of active landfills, which entailed the recording of an adjustment of the same amount as the value of tangible assets (landfill asset), totalling 1.9 million euro for the year 2022. The \u201cProvision for legal cases and disputes brought by personnel\u201d reflects the outcomes of lawsuits and disputes brought by employees. \u201cProvision for plants dismantling\u201d includes the amounts allocated for the future dismantling of the plants for cases in which it is mandatory. \u201cProvision for waste disposal\u201d reports the estimated costs of disposal of the waste already stored at the Group\u2019s plants. The provisions reflect the estimated costs of contributions for the year 2022 not yet processed at the end of the financial period, while the uses represent the costs incurred over the period for the processing of waste that was residual as at 31 December 2021. \u201cOther provisions for risks and charges\u201d comprises provisions made against sundry risks. Below, there is a description of the main items: Liabilities Type Amount (mn \u20ac) The higher cost of the electricity used in the water service provision was not recognised, due to the volatility of the energy market, which resulted in price values for the period that were higher than the allowed maximum limit provided for by the tariff system. Likely 18.5 The amount of the WTE and cogeneration plants\u2019 green certificates, calculated according to the difference between auxiliary services resulting from total self- consumption and services estimated on the basis of the benchmark percentage, was not recognised; Likely 14.0 Outstanding bonds (guarantee on financial exposure given by AcegasApsAmga Spa) in case of abandonment of the operations run by the foreign subsidiary AresGas (Bulgaria). Contingent 11.3 Risks arising from the activity of energy efficiency upgrading of buildings carried out on behalf of end customers, particularly apartment blocks Likely 11.3 Reimbursement of a portion of the sewerage and purification tariffs for the water service Likely 6.1 Potentially higher expenses that may be incurred in connection with extraordinary maintenance on the Ponte San Nicol\u00f2 (Padua) landfill Contingent 5.2 Potential litigations arising from the risk of disputes in relation to the gas distribution unit of the Veneto and Friuli Venezia-Giulia regions, which was sold at the end of 2019 Likely 3.5 The liabilities classified as contingent were recognised as part of the business combination in the year in which it occurred. Provisions in this category, which amounted to 44 million euro, showed an increase compared to the previous year, mainly due to legislative and regulatory risks. The reduction of 16.8 million euro, classified as \u201cOther movements\u201d is mainly attributable to the following: release of provisions recorded in previous years, valued in excess of the actual liability, in the amount of 10.9 million euro. These refer, in the amount of 6.5 million euro, to the approval of applications submitted in relation to the full recognition of electricity costs incurred in the water service sector for the year 2021, the full remuneration of which will be guaranteed by means of the tariff in subsequent years; partial offsetting of the provision for risks set aside in previous years for the non-recognition of green certificates, in the amount of 4.7 million euro, with a similar amount of receivables recorded under current assets for certificates. The \u201cChange in the scope of consolidation\u201d include the provisions of the companies acquired during 2022. For detailed information on risk provisions for tax litigations, see note 12 \u201cTaxes\u201d. ", "dimensions": { "concept": "ifrs-full:DisclosureOfProvisionsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-435": { "value": "8 Depreciation amortisation and provisions 2022 2021 Change Depreciation and amortisation 478.6 469.9 8.7 Net provisions 188.5 142.2 46.3 Total 667.1 612.1 55.0 The details of the item Depreciation and amortisation are as follows: Notes 2022 2021 Change Depreciation 21, 22, 23 477.1 463.3 13.8 Write-downs 21, 22, 23 1.5 6.6 (5.1) Total 478.6 469.9 8.7 Depreciation includes the depreciation of tangible assets, rights of use and intangible assets. Write-downs refer mainly to waste treatment business assets. The details of the item Net provisions are as follows: Notes 2022 2021 Change Provisions to the bad debts fund 33 133.9 94.4 39.5 Provisions to risks and charge funds 31 66.6 52.0 14.6 De-provisioning 31, 33 (12.0) (4.2) (7.8) Total 188.5 142.2 46.3 Provisions include value adjustments to the bad debts fund and provisions for risks and charges. De-provisioning includes the re-verification of funds in view of the fact that the underlying risks no longer exist.", "dimensions": { "concept": "ifrs-full:DisclosureOfDepreciationAndAmortisationExpenseExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-436": { "value": "9 Share of profits (losses) pertaining to joint ventures and associated companies 2022 2021 Change Joint venture share of net profits 3.1 3.1 \u2010 Associated companies share of net profits 6.9 10.1 (3.2) Total 10.0 13.2 (3.2) The share of profits and losses of joint ventures and associated companies includes the effects generated by the valuation of the companies included in the scope of consolidation carried out using the equity method. For details please refer to note 26 \u201cShareholdings\u201d.
31 Dec 22
31 Dec 21
Change
Shareholdings valued using the equity method
151.4
150.6
0.8
Other shareholdings
38.9
47.9
(9.0)
Total
190.3
198.5
(8.2)
The changes in joint ventures and associated companies as compared to 31 December 2021 take into
account the pro-quota losses and profits reported by the respective companies (including the other
components of the comprehensive income statement) as well as the possible reduction of the value for
any dividends that were distributed and for depreciations due to the impairment test.
Changes in consolidated shareholdings using the net equity method are as follows: Opening value Investments and disinvestments Profit for the fin. year Dividends paid out Changes in the scope of consolidation Write-downs and other changes Terminal value 31 Dec 21 Enomondo Srl 15.6 \u2010 3.1 (1.1) \u2010 \u2010 17.6 Total joint ventures 15.6 \u2010 3.1 (1.1) \u2010 \u2010 17.6 Aimag Spa 50.6 \u2010 3.7 (2.6) \u2010 \u2010 51.7 Set Spa 27.9 \u2010 0.6 \u2010 \u2010 \u2010 28.5 Sgr Servizi Spa 24.4 \u2010 3.0 (2.2) \u2010 \u2010 25.2 ASM SET Srl 18.7 \u2010 1.4 (1.2) \u2010 \u2010 18.9 SEA - Servizi Ecologici Ambientali Srl \u2010 \u2010 1.4 (2.4) 9.7 \u2010 8.7 Total associated companies 121.6 \u2010 10.1 (8.4) 9.7 \u2010 133.0 Total 137.2 \u2010 13.2 (9.5) 9.7 \u2010 150.6 31 Dec 22 Enomondo Srl 17.6 \u2010 3.1 (2.2) \u2010 0.3 18.8 Total joint ventures 17.6 \u2010 3.1 (2.2) \u2010 0.3 18.8 Aimag Spa 51.7 \u2010 2.3 (2.8) \u2010 \u2010 51.2 Set Spa 28.5 \u2010 (0.6) \u2010 \u2010 \u2010 27.9 Sgr Servizi Spa 25.2 \u2010 2.4 (2.0) \u2010 (0.1) 25.5 ASM SET Srl 18.9 \u2010 1.5 (1.4) \u2010 (0.1) 18.9 SEA - Servizi Ecologici Ambientali Srl 8.7 \u2010 1.3 (1.0) \u2010 0.1 9.1 Total associated companies 133.0 \u2010 6.9 (7.2) \u2010 (0.1) 132.6 Total 150.6 \u2010 10.0 (9.4) \u2010 0.2 151.4 The result for the year decreased from the previous year mainly due to the lower results reported by Aimag Spa, a multi-utility company operating in the province of Modena area, and Set Spa, an investment vehicle for a combined-cycle power plant located in Teverola (CE). On the other hand, the results of the company Enomondo Srl, operating in the production of thermal energy and electricity from biomass combustion plants, remained constant. No impairments or reversals of impairments were reported for companies within the scope of consolidation. For more details on the assumptions and results of the impairment tests to which the carrying values of the investments in affiliates that represent vehicles through which the Group holds shares in the production of electric generation plants (Set Spa and Tamarete Energia Srl) were subjected, please see the information in Note 27 \u201cImpairment tests on shareholdings\u201d below.
Associated
companies
and joint
ventures
Below are presented the main aggregate values of the joint venture Enomondo Srl as well as companies with significant influence (Aimag Spa, ASM SET Srl, SEA Srl, Set Spa, Sgr Servizi Spa and Tamarete Energia Srl): Assets Company Joint ventures Company Associated companies Total Non-current assets Tangible assets 34.3 410.6 444.9 Rights of use 0.6 0.6 Intangible assets 53.4 53.4 Goodwill 105.0 105.0 Shareholdings 7.0 7.0 Financial assets 0.5 12.9 13.4 Deferred tax assets 0.7 4.5 5.2 Total non-current assets 35.5 594.0 629.5 Current assets Inventories 0.5 23.3 23.8 Trade receivables 7.3 337.6 344.9 Contract work in progress 3.0 3.0 Financial assets 9.1 9.1 Current tax assets 3.5 3.5 Other current assets 6.5 99.8 106.3 Derivative instruments 0.6 0.6 Cash and cash equivalents 8.0 29.3 37.3 Total current assets 22.9 505.6 528.5 Total assets 58.4 1,099.6 1,158.0
Investee
data
Net equity and liabilities
Company
Joint ventures
Company
Associated companies
Total
Share capital and reserves
Share capital
14.0
88.0
102.0
Reserves
17.4
281.8
299.2
Profit (loss) for the period
6.1
26.6
32.7
Group net equity
37.5
396.4
433.9
Non-controlling interests
14.3
14.3
Total net equity
37.5
410.7
448.2
Non-current liabilities
Non-current financial liabilities
7.2
213.5
220.7
Non-current lease liabilities
0.4
0.4
Post-employment and other benefits
5.6
5.6
Provisions for risks and charges
1.0
37.8
38.8
Deferred tax liabilities
0.1
0.7
0.8
Derivative financial instruments
0.1
0.1
Total non-current liabilities
8.3
258.1
266.4
Current liabilities
Current financial liabilities
3.0
145.8
148.8
Current lease liabilities
0.1
0.1
Trade payables
8.6
255.2
263.8
Current tax liabilities
0.3
0.3
Other current liabilities
1.0
29.4
30.4
Total current liabilities
12.6
430.8
443.4
Total liabilities
20.9
688.9
709.8
Total net equity and total liabilities
58.4
1,099.6
1,158.0
Income statement
Company
Joint ventures
Company
Associated companies
Total
Revenues
28.8
1,265.9
1,294.7
Other operating revenues
3.5
2.5
6.0
Raw materials and materials
(2.5)
(1,015.1)
(1,017.6)
Service costs
(15.8)
(100.0)
(115.8)
Personnel costs
(0.4)
(29.3)
(29.7)
Amortisation, provisions and depreciation
(5.4)
(55.9)
(61.3)
Other operating costs
(0.1)
(22.2)
(22.3)
Operating revenues
8.1
45.9
54.0
Financial income
5.0
5.0
Financial expenses
(0.2)
(9.5)
(9.7)
Total financial management
(0.2)
(4.5)
(4.7)
Other non-operating revenues (expenses)
(1.3)
(1.3)
Earnings before taxes
7.9
40.1
48.0
Taxes for the period
(1.8)
(12.3)
(14.1)
Net revenues for the period
6.1
27.8
33.9
Jointly controlled entities Registered name Registered office Share capital (\u20ac) Percentage held Total interest direct indirect Enomondo Srl Faenza (RA) 14,000,000 37.50% 37.50% Associated companies Registered name Registered office Share capital (euro) (*) Percentage held Total interest direct indirect Aimag Spa* Mirandola (MO) 78,027,681 25.00% 25.00% ASM Servizi Energetici e Tecnologici-ASM SET Srl Rovigo 200,000 49.00% 49.00% SEA - Servizi Ecologici Ambientali Srl Camerata Picena (AN) 100,000 31.00% 31.00% Set Spa Milan 120,000 39.00% 39.00% Sgr Servizi Spa Rimini 5,982,262 29.61% 29.61% Tamarete Energia Srl Ortona (CH) 3,600,000 40.00% 40.00% *The share capital of these companies consists of 67,577,681 euro of ordinary shares and 10,450,000 euro of related shares. Summary of key figures of the financial statements of joint ventures pursuant to Article 2429, last paragraph, of the Civil Code. thous. \u20ac Enomondo Srl ASSETS Fixed assets 39,678 Circulating assets 23,392 Total assets 63,070 LIABILITIES Share capital 14,000 Reserves 23,546 Net profit /(loss) 4,679 Provisions 1,167 Severance pay provision 19
Payables
19,659
Total liabilities
63,070
INCOME STATEMENT
Production value
32,319
Production costs
(25,728)
Financial income/ (expenses)
(125)
Extraordinary income/ (expenses)
Taxes for the year
(1,787)
Net profit /(loss)
4,679
Summary of key figures of the financial statements of associated companies pursuant to Article 2429,
last paragraph, of the Civil code.
thous. \u20ac
Aimag Spa
ASM SET Srl
SEA - Servizi
Ecologici
Ambientali Srl
Set Spa
Sgr Servizi Spa
Tamarete
Energia Srl
ASSETS
Fixed assets
380,984
65
13,040
109,031
1,483
51,506
Circulating assets
224,238
12,063
12,749
109,105
131,180
15,300
Total assets
605,222
12,128
25,789
218,136
132,663
66,806
LIABILITIES
\u2010
Share capital
78,028
200
100
120
5,982
3,600
Reserves
136,649
69
10,275
72,917
43,455
1,972
Net profit /(loss)
17,286
2,982
4,590
(1,532)
8,992
21
Provisions
32,423
1,723
143
3,760
Severance pay provision
3,588
263
499
301
1,587
Payables
337,248
8,614
8,602
146,330
72,504
57,453
Total liabilities
605,222
12,128
25,789
218,136
132,663
66,806
INCOME STATEMENT
\u2010
Production value
423,482
54,500
19,564
284,545
312,852
40,711
Production costs
(398,465)
(50,320)
(12,915)
(285,070)
(301,094)
(38,340)
Financial income/ (expenses)
(1,397)
2
(90)
(759)
801
(2,183)
Extraordinary income/ (expenses)
427
(1,004)
Taxes for the year
(6,761)
(1,200)
(1,969)
756
(3,567)
(167)
Net profit /(loss)
17,286
2,982
4,590
(1,532)
8,992
21
", "dimensions": { "concept": "ifrs-full:DisclosureOfInvestmentsAccountedForUsingEquityMethodExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-502": { "value": "10 Financial income 2022 2021 Change Customers 24.2 28.1 (3.9) Income from derivatives 18.3 29.3 (11.0) Income from the disposal of tax credits 16.0 1.5 14.5 Income from valuation at fair value of financial liabilities 11.2 9.5 1.7 Other financial income 12.5 13.9 (1.4) Total income 82.2 82.3 (0.1) \u201cCustomers\u201d mainly include interest on payments in arrears attributable to the gas and electricity sales business. \u201cIncome from derivatives\u201d includes the effects of both valuation and realization of interest and foreign exchange derivatives, as detailed in Note 29 \u201cDerivative Instruments.\u201d \u201cIncome from the disposal of tax credits\u201d represents the financial income realized following the transfers to banking institutions of tax credits resulting from the application of the discount on invoices for energy efficiency work carried out on behalf of customers who have taken advantage of the 110% super-bonus rebate. In 2022, in order to ensure efficient cash management and raise resources for operations, the Group made widespread use of the sale of the 110% super-bonus rebate, a solution only partially utilised in the 2021 financial period. \u201cIncome from valuation at fair value of financial assets and liabilities\u201d, this item includes the following: Notes 2022 2021 Change Minority shareholders\u2019 put option 19 12.6 0.7 11.9 Bonds 29 \u2010 7.5 (7.5) Energy efficiency credits (1.4) 1.3 (2.7) Total 11.2 9.5 1.7 \u25aa Put options and contingent consideration represent the positive effects of updating the estimates of liabilities recognized in previous years in connection with one-time acquisition transactions. The value at 31 December 2022 includes, in particular, the effects of the updated valuation of the debt for the put option held by Ascopiave Spa on the minority shareholding in EstEnergy Spa, taking into account the partial exercise of an 8% share; \u25aa Energy efficiency credits, relating to the market value valuation of receivables related to the application of the so-called upfront discount to end customers for work covered by the 110% super- bonus rebate, held by the Group and designated to be sold to financial institutions. For the accounting treatment of this case, please see the details outlined in note 11 \u201cFinancial expenses\u201d in relation to the expenses from valuation at fair value of financial assets and liabilities. The item \u201cOther financial income\u201d includes the following: Notes 2022 2021 Change Discounting of non-current financial receivables 18 4.7 5.3 (0.6) Dividends 4.1 3.5 0.6 Loans 18 2.0 2.1 (0.1) Write-back of value 25, 27 \u2010 2.2 (2.2) Other 1.7 0.8 0.9 Total 12.5 13.9 (1.4) \u25aa Discounting of non-current financial receivables mainly represent the effect of valuation at the amortised cost the receivables for construction and improvement of assets recorded as part of applying the financial activity model for public services under concession; \u25aa Dividends represent the portions of profit distributed by minor unconsolidated holdings, especially referring to the shareholding in Ascopiave Spa; \u25aa The item Loans, in line with the previous year, represents interest income on loans granted to companies valued at net equity and minor investees. 11 Financial expenses 2022 2021 Change Expenses from bonds and loans 82.2 73.1 9.1 Factoring charges and transfer of tax credits 47.3 13.3 34.0 Valuation at depreciated cost of financial liabilities 30.0 29.7 0.3 Expenses from derivatives 21.4 34.1 (12.7) Discounting of options and consideration on equity investments 20.7 20.0 0.7 Discounting of provisions 12.5 18.6 (6.1) Expenses from trading \u2010 82.6 (82.6) Expenses from valuation at fair value of financial assets and liabilities (6.3) 25.8 (32.1) Other financial expenses 9.4 3.1 6.3 Total 217.2 300.3 (83.1) \u201cExpenses from bonds and loans\u201d include interest for the period relating to bond instruments issued by the parent company Hera Spa and interest relating to loans provided by the banking system and other financing institutions. The increase compared to the previous year is related to the higher level of debt due to the bond issued in May 2022 and the new loans undertaken during the period. These operations resulted in an increase in expenses that more than offset the savings from the debt optimization operation carried out through the renegotiation of five bonds made in the financial period 2021. \u201cFactoring charges and transfers of tax credits\u201d includes the following: notes 2022 2021 Change Disposals of tax credits 35 33.3 9.9 23.4 Disposals of trade receivables and other operating receivables 14.0 3.4 10.6 Total 47.3 13.3 34.0 Disposals of tax credits represent the expenses realized in the context of transactions involving the disposal of receivables recorded as a result of the application of the upfront discount to customers for energy efficiency measures. The increase compared to the previous year is due to both an increase in the volume of business in this area, which consequently generated more tax credits in the portfolio, and a reduction in transfer prices. The increase in charges related to the assignment of trade and other operating receivables stems mainly from the increase in the volume of receivables disposed of during the year. \u201cValuation at depreciated cost of financial liabilities\u201d include imputed charges necessary to bring the face cost of debt in line with that calculated using the effective interest rate method. The item also includes figurative charges of 1.6 million euro, in line with the previous year, relating to the put option held by Ascopiave Spa on the minority shareholding in Hera Comm Spa, accounted for as a loan (with a nominal value of 54 million euro), as reported in Note 19 \"Financial liabilities.\". \u201cExpenses from derivatives\u201d includes the effects of both valuation and realization of interest and foreign exchange derivatives, as detailed in Note 29 \u201cDerivative Instruments.\u201d \u201cDiscounting of options and consideration on equity investments\u201d mainly includes notional discounting charges related to the fair value valuation of put options granted to minority shareholders, as reported in Note 19 \u201cFinancial liabilities\u201d. \u201cDiscounting of provisions\u201d is broken down as follows: Notes 2022 2021 Change Post-closure landfills 31 8.0 13.2 (5.2) Restoration of third-party assets 31 4.1 5.4 (1.3) Post-employment and other employee benefits 30 0.3 (0.1) 0.4 Plant dismantling 31 0.1 0.1 \u2010 Total 12.5 18.6 (6.1) Please see the notes to the respective balance sheet items for an analysis of the change in charges for discounting funds in relation to the comparison year, where significant. \u201cExpenses from trading\u201d at 31 December 2021 include the net effect of partial repurchase transactions in relation to five bond issues. These operations had led to the repayment of the debt for the nominal share repurchased in the amount of 405.5 million euro and the recording of net charges totalling 82.6 million euro. \u201cExpenses from valuation at fair value of financial assets and liabilities\u201d, this item includes the following: Notes 2022 2021 Change Minority shareholders\u2019 put option 19 5.7 0.8 4.9 Bonds 29 0.6 6.4 (5.8) Energy efficiency credits 35 (12.6) 18.6 (31.2) Total (6.3) 25.8 (32.1) \u25aa Put options and contingent consideration represent the negative effects of updating the estimates of liabilities recognized in previous years in connection with one-time commercial acquisition transactions. \u25aa Bonds represent valuation adjustments, in application of fair value hedging; \u25aa Energy efficiency credits are related to the measurement at current market value of receivables related to the application of the upfront discount to end customers for energy efficiency measures, designated to be sold to financial institutions once the formal process of recognizing the relevant tax credit is completed. In fact, the accounting policy adopted by the Group stipulates that, at the time of the actual sale, the final charge associated with the transaction be recorded in the item \u201cFactoring charges and sales of tax receivables,\u201d proceeding at the same time to terminate the valuation position opened in the previous year, thereby generating a substantially offsetting effect. The positive value is only partially offset by valuation charges recognized on loans issued in the 2022 financial year. The item \u201cOther financial expenses\u201d, residual in nature, includes the following: Notes 2022 2021 Change Leases 22 2.6 3.1 (0.5) Write-downs 27 \u2010 2.4 (2.4) Other expenses 6.8 (2.4) 9.2 Total 9.4 3.1 6.3 Other expenses mainly include interest for financial intermediation and interest related to payment deferrals. ", "dimensions": { "concept": "ifrs-full:DisclosureOfInterestIncomeExpenseExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-487": { "value": "10 Financial income 2022 2021 Change Customers 24.2 28.1 (3.9) Income from derivatives 18.3 29.3 (11.0) Income from the disposal of tax credits 16.0 1.5 14.5 Income from valuation at fair value of financial liabilities 11.2 9.5 1.7 Other financial income 12.5 13.9 (1.4) Total income 82.2 82.3 (0.1) \u201cCustomers\u201d mainly include interest on payments in arrears attributable to the gas and electricity sales business. \u201cIncome from derivatives\u201d includes the effects of both valuation and realization of interest and foreign exchange derivatives, as detailed in Note 29 \u201cDerivative Instruments.\u201d \u201cIncome from the disposal of tax credits\u201d represents the financial income realized following the transfers to banking institutions of tax credits resulting from the application of the discount on invoices for energy efficiency work carried out on behalf of customers who have taken advantage of the 110% super-bonus rebate. In 2022, in order to ensure efficient cash management and raise resources for operations, the Group made widespread use of the sale of the 110% super-bonus rebate, a solution only partially utilised in the 2021 financial period. \u201cIncome from valuation at fair value of financial assets and liabilities\u201d, this item includes the following: Notes 2022 2021 Change Minority shareholders\u2019 put option 19 12.6 0.7 11.9 Bonds 29 \u2010 7.5 (7.5) Energy efficiency credits (1.4) 1.3 (2.7) Total 11.2 9.5 1.7 \u25aa Put options and contingent consideration represent the positive effects of updating the estimates of liabilities recognized in previous years in connection with one-time acquisition transactions. The value at 31 December 2022 includes, in particular, the effects of the updated valuation of the debt for the put option held by Ascopiave Spa on the minority shareholding in EstEnergy Spa, taking into account the partial exercise of an 8% share; \u25aa Energy efficiency credits, relating to the market value valuation of receivables related to the application of the so-called upfront discount to end customers for work covered by the 110% super- bonus rebate, held by the Group and designated to be sold to financial institutions. For the accounting treatment of this case, please see the details outlined in note 11 \u201cFinancial expenses\u201d in relation to the expenses from valuation at fair value of financial assets and liabilities. The item \u201cOther financial income\u201d includes the following: Notes 2022 2021 Change Discounting of non-current financial receivables 18 4.7 5.3 (0.6) Dividends 4.1 3.5 0.6 Loans 18 2.0 2.1 (0.1) Write-back of value 25, 27 \u2010 2.2 (2.2) Other 1.7 0.8 0.9 Total 12.5 13.9 (1.4) \u25aa Discounting of non-current financial receivables mainly represent the effect of valuation at the amortised cost the receivables for construction and improvement of assets recorded as part of applying the financial activity model for public services under concession; \u25aa Dividends represent the portions of profit distributed by minor unconsolidated holdings, especially referring to the shareholding in Ascopiave Spa; \u25aa The item Loans, in line with the previous year, represents interest income on loans granted to companies valued at net equity and minor investees. 11 Financial expenses 2022 2021 Change Expenses from bonds and loans 82.2 73.1 9.1 Factoring charges and transfer of tax credits 47.3 13.3 34.0 Valuation at depreciated cost of financial liabilities 30.0 29.7 0.3 Expenses from derivatives 21.4 34.1 (12.7) Discounting of options and consideration on equity investments 20.7 20.0 0.7 Discounting of provisions 12.5 18.6 (6.1) Expenses from trading \u2010 82.6 (82.6) Expenses from valuation at fair value of financial assets and liabilities (6.3) 25.8 (32.1) Other financial expenses 9.4 3.1 6.3 Total 217.2 300.3 (83.1) \u201cExpenses from bonds and loans\u201d include interest for the period relating to bond instruments issued by the parent company Hera Spa and interest relating to loans provided by the banking system and other financing institutions. The increase compared to the previous year is related to the higher level of debt due to the bond issued in May 2022 and the new loans undertaken during the period. These operations resulted in an increase in expenses that more than offset the savings from the debt optimization operation carried out through the renegotiation of five bonds made in the financial period 2021. \u201cFactoring charges and transfers of tax credits\u201d includes the following: notes 2022 2021 Change Disposals of tax credits 35 33.3 9.9 23.4 Disposals of trade receivables and other operating receivables 14.0 3.4 10.6 Total 47.3 13.3 34.0 Disposals of tax credits represent the expenses realized in the context of transactions involving the disposal of receivables recorded as a result of the application of the upfront discount to customers for energy efficiency measures. The increase compared to the previous year is due to both an increase in the volume of business in this area, which consequently generated more tax credits in the portfolio, and a reduction in transfer prices. The increase in charges related to the assignment of trade and other operating receivables stems mainly from the increase in the volume of receivables disposed of during the year. \u201cValuation at depreciated cost of financial liabilities\u201d include imputed charges necessary to bring the face cost of debt in line with that calculated using the effective interest rate method. The item also includes figurative charges of 1.6 million euro, in line with the previous year, relating to the put option held by Ascopiave Spa on the minority shareholding in Hera Comm Spa, accounted for as a loan (with a nominal value of 54 million euro), as reported in Note 19 \"Financial liabilities.\". \u201cExpenses from derivatives\u201d includes the effects of both valuation and realization of interest and foreign exchange derivatives, as detailed in Note 29 \u201cDerivative Instruments.\u201d \u201cDiscounting of options and consideration on equity investments\u201d mainly includes notional discounting charges related to the fair value valuation of put options granted to minority shareholders, as reported in Note 19 \u201cFinancial liabilities\u201d. \u201cDiscounting of provisions\u201d is broken down as follows: Notes 2022 2021 Change Post-closure landfills 31 8.0 13.2 (5.2) Restoration of third-party assets 31 4.1 5.4 (1.3) Post-employment and other employee benefits 30 0.3 (0.1) 0.4 Plant dismantling 31 0.1 0.1 \u2010 Total 12.5 18.6 (6.1) Please see the notes to the respective balance sheet items for an analysis of the change in charges for discounting funds in relation to the comparison year, where significant. \u201cExpenses from trading\u201d at 31 December 2021 include the net effect of partial repurchase transactions in relation to five bond issues. These operations had led to the repayment of the debt for the nominal share repurchased in the amount of 405.5 million euro and the recording of net charges totalling 82.6 million euro. \u201cExpenses from valuation at fair value of financial assets and liabilities\u201d, this item includes the following: Notes 2022 2021 Change Minority shareholders\u2019 put option 19 5.7 0.8 4.9 Bonds 29 0.6 6.4 (5.8) Energy efficiency credits 35 (12.6) 18.6 (31.2) Total (6.3) 25.8 (32.1) \u25aa Put options and contingent consideration represent the negative effects of updating the estimates of liabilities recognized in previous years in connection with one-time commercial acquisition transactions. \u25aa Bonds represent valuation adjustments, in application of fair value hedging; \u25aa Energy efficiency credits are related to the measurement at current market value of receivables related to the application of the upfront discount to end customers for energy efficiency measures, designated to be sold to financial institutions once the formal process of recognizing the relevant tax credit is completed. In fact, the accounting policy adopted by the Group stipulates that, at the time of the actual sale, the final charge associated with the transaction be recorded in the item \u201cFactoring charges and sales of tax receivables,\u201d proceeding at the same time to terminate the valuation position opened in the previous year, thereby generating a substantially offsetting effect. The positive value is only partially offset by valuation charges recognized on loans issued in the 2022 financial year. The item \u201cOther financial expenses\u201d, residual in nature, includes the following: Notes 2022 2021 Change Leases 22 2.6 3.1 (0.5) Write-downs 27 \u2010 2.4 (2.4) Other expenses 6.8 (2.4) 9.2 Total 9.4 3.1 6.3 Other expenses mainly include interest for financial intermediation and interest related to payment deferrals. ", "dimensions": { "concept": "ifrs-full:DisclosureOfFinanceIncomeExpenseExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-46": { "value": "10 Financial income 2022 2021 Change Customers 24.2 28.1 (3.9) Income from derivatives 18.3 29.3 (11.0) Income from the disposal of tax credits 16.0 1.5 14.5 Income from valuation at fair value of financial liabilities 11.2 9.5 1.7 Other financial income 12.5 13.9 (1.4) Total income 82.2 82.3 (0.1) \u201cCustomers\u201d mainly include interest on payments in arrears attributable to the gas and electricity sales business. \u201cIncome from derivatives\u201d includes the effects of both valuation and realization of interest and foreign exchange derivatives, as detailed in Note 29 \u201cDerivative Instruments.\u201d \u201cIncome from the disposal of tax credits\u201d represents the financial income realized following the transfers to banking institutions of tax credits resulting from the application of the discount on invoices for energy efficiency work carried out on behalf of customers who have taken advantage of the 110% super-bonus rebate. In 2022, in order to ensure efficient cash management and raise resources for operations, the Group made widespread use of the sale of the 110% super-bonus rebate, a solution only partially utilised in the 2021 financial period. \u201cIncome from valuation at fair value of financial assets and liabilities\u201d, this item includes the following: Notes 2022 2021 Change Minority shareholders\u2019 put option 19 12.6 0.7 11.9 Bonds 29 \u2010 7.5 (7.5) Energy efficiency credits (1.4) 1.3 (2.7) Total 11.2 9.5 1.7 \u25aa Put options and contingent consideration represent the positive effects of updating the estimates of liabilities recognized in previous years in connection with one-time acquisition transactions. The value at 31 December 2022 includes, in particular, the effects of the updated valuation of the debt for the put option held by Ascopiave Spa on the minority shareholding in EstEnergy Spa, taking into account the partial exercise of an 8% share; \u25aa Energy efficiency credits, relating to the market value valuation of receivables related to the application of the so-called upfront discount to end customers for work covered by the 110% super- bonus rebate, held by the Group and designated to be sold to financial institutions. For the accounting treatment of this case, please see the details outlined in note 11 \u201cFinancial expenses\u201d in relation to the expenses from valuation at fair value of financial assets and liabilities. The item \u201cOther financial income\u201d includes the following: Notes 2022 2021 Change Discounting of non-current financial receivables 18 4.7 5.3 (0.6) Dividends 4.1 3.5 0.6 Loans 18 2.0 2.1 (0.1) Write-back of value 25, 27 \u2010 2.2 (2.2) Other 1.7 0.8 0.9 Total 12.5 13.9 (1.4) \u25aa Discounting of non-current financial receivables mainly represent the effect of valuation at the amortised cost the receivables for construction and improvement of assets recorded as part of applying the financial activity model for public services under concession; \u25aa Dividends represent the portions of profit distributed by minor unconsolidated holdings, especially referring to the shareholding in Ascopiave Spa; \u25aa The item Loans, in line with the previous year, represents interest income on loans granted to companies valued at net equity and minor investees. ", "dimensions": { "concept": "ifrs-full:DisclosureOfFinanceIncomeExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-463": { "value": "\u25aa The item Loans, in line with the previous year, represents interest income on loans granted to companies valued at net equity and minor investees. ", "dimensions": { "concept": "ifrs-full:DisclosureOfInterestIncomeExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-47": { "value": "11 Financial expenses 2022 2021 Change Expenses from bonds and loans 82.2 73.1 9.1 Factoring charges and transfer of tax credits 47.3 13.3 34.0 Valuation at depreciated cost of financial liabilities 30.0 29.7 0.3 Expenses from derivatives 21.4 34.1 (12.7) Discounting of options and consideration on equity investments 20.7 20.0 0.7 Discounting of provisions 12.5 18.6 (6.1) Expenses from trading \u2010 82.6 (82.6) Expenses from valuation at fair value of financial assets and liabilities (6.3) 25.8 (32.1) Other financial expenses 9.4 3.1 6.3 Total 217.2 300.3 (83.1) \u201cExpenses from bonds and loans\u201d include interest for the period relating to bond instruments issued by the parent company Hera Spa and interest relating to loans provided by the banking system and other financing institutions. The increase compared to the previous year is related to the higher level of debt due to the bond issued in May 2022 and the new loans undertaken during the period. These operations resulted in an increase in expenses that more than offset the savings from the debt optimization operation carried out through the renegotiation of five bonds made in the financial period 2021. \u201cFactoring charges and transfers of tax credits\u201d includes the following: notes 2022 2021 Change Disposals of tax credits 35 33.3 9.9 23.4 Disposals of trade receivables and other operating receivables 14.0 3.4 10.6 Total 47.3 13.3 34.0 Disposals of tax credits represent the expenses realized in the context of transactions involving the disposal of receivables recorded as a result of the application of the upfront discount to customers for energy efficiency measures. The increase compared to the previous year is due to both an increase in the volume of business in this area, which consequently generated more tax credits in the portfolio, and a reduction in transfer prices. The increase in charges related to the assignment of trade and other operating receivables stems mainly from the increase in the volume of receivables disposed of during the year. \u201cValuation at depreciated cost of financial liabilities\u201d include imputed charges necessary to bring the face cost of debt in line with that calculated using the effective interest rate method. The item also includes figurative charges of 1.6 million euro, in line with the previous year, relating to the put option held by Ascopiave Spa on the minority shareholding in Hera Comm Spa, accounted for as a loan (with a nominal value of 54 million euro), as reported in Note 19 \"Financial liabilities.\". \u201cExpenses from derivatives\u201d includes the effects of both valuation and realization of interest and foreign exchange derivatives, as detailed in Note 29 \u201cDerivative Instruments.\u201d \u201cDiscounting of options and consideration on equity investments\u201d mainly includes notional discounting charges related to the fair value valuation of put options granted to minority shareholders, as reported in Note 19 \u201cFinancial liabilities\u201d. \u201cDiscounting of provisions\u201d is broken down as follows: Notes 2022 2021 Change Post-closure landfills 31 8.0 13.2 (5.2) Restoration of third-party assets 31 4.1 5.4 (1.3) Post-employment and other employee benefits 30 0.3 (0.1) 0.4 Plant dismantling 31 0.1 0.1 \u2010 Total 12.5 18.6 (6.1) Please see the notes to the respective balance sheet items for an analysis of the change in charges for discounting funds in relation to the comparison year, where significant. \u201cExpenses from trading\u201d at 31 December 2021 include the net effect of partial repurchase transactions in relation to five bond issues. These operations had led to the repayment of the debt for the nominal share repurchased in the amount of 405.5 million euro and the recording of net charges totalling 82.6 million euro. \u201cExpenses from valuation at fair value of financial assets and liabilities\u201d, this item includes the following: Notes 2022 2021 Change Minority shareholders\u2019 put option 19 5.7 0.8 4.9 Bonds 29 0.6 6.4 (5.8) Energy efficiency credits 35 (12.6) 18.6 (31.2) Total (6.3) 25.8 (32.1) \u25aa Put options and contingent consideration represent the negative effects of updating the estimates of liabilities recognized in previous years in connection with one-time commercial acquisition transactions. \u25aa Bonds represent valuation adjustments, in application of fair value hedging; \u25aa Energy efficiency credits are related to the measurement at current market value of receivables related to the application of the upfront discount to end customers for energy efficiency measures, designated to be sold to financial institutions once the formal process of recognizing the relevant tax credit is completed. In fact, the accounting policy adopted by the Group stipulates that, at the time of the actual sale, the final charge associated with the transaction be recorded in the item \u201cFactoring charges and sales of tax receivables,\u201d proceeding at the same time to terminate the valuation position opened in the previous year, thereby generating a substantially offsetting effect. The positive value is only partially offset by valuation charges recognized on loans issued in the 2022 financial year. The item \u201cOther financial expenses\u201d, residual in nature, includes the following: Notes 2022 2021 Change Leases 22 2.6 3.1 (0.5) Write-downs 27 \u2010 2.4 (2.4) Other expenses 6.8 (2.4) 9.2 Total 9.4 3.1 6.3 Other expenses mainly include interest for financial intermediation and interest related to payment deferrals. ", "dimensions": { "concept": "ifrs-full:DisclosureOfFinanceCostExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-464": { "value": "
2022
2021
Change
Expenses from bonds and loans
82.2
73.1
9.1
Factoring charges and transfer of tax credits
47.3
13.3
34.0
Valuation at depreciated cost of financial liabilities
30.0
29.7
0.3
Expenses from derivatives
21.4
34.1
(12.7)
Discounting of options and consideration on equity investments
20.7
20.0
0.7
Discounting of provisions
12.5
18.6
(6.1)
Expenses from trading
\u2010
82.6
(82.6)
Expenses from valuation at fair value of financial assets and
liabilities
(6.3)
25.8
(32.1)
Other financial expenses
9.4
3.1
6.3
Total
217.2
300.3
(83.1)
", "dimensions": { "concept": "ifrs-full:DisclosureOfInterestExpenseExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-437": { "value": "Taxation 2022 2021 Change Earnings before taxes 408.8 406.9 1.9 Taxes (103.5) (34.2) (69.3) Net profit for the period 305.3 372.7 (67.4) Tax rate 25.3% 8.4% The change in the tax amount and consequent increase in the tax rate are due to the exemption transaction carried out in the last fiscal year. In fact, during 2021, there had been a tax realignment of higher values related to eligible goodwill which, specifically, had resulted in the recognition of deferred tax assets in the amount of 79.8 million euro, the write-off of deferred tax liabilities in the amount of 7.2 million euro, against the payment of substitute taxes in the amount of 3% of the value of the realigned goodwill, amounting to 9.2 million euro. In relation to the tax rate for the 2022 financial year, extraordinary tax rebates, in the form of tax credits, introduced for the purchase of electricity and gas had a major impact on the calculation of the tax rate, representing positive untaxed income components amounting to approximately 38 million euro, as well as benefits from the exemption of some higher values generated by company acquisitions. 12 Taxes This item is made up as follows: 2022 2021 Change Current Pre-paid Deferred Total Current Pre-paid Deferred Total IRES 81.0 (13.0) 0.7 68.7 99.4 (82.7) (12.5) 4.2 64.5 IRAP 26.7 (0.7) 1.1 27.1 31.4 (11.9) (2.6) 16.9 10.2 Substitute tax 5.4 \u2010 \u2010 5.4 13.1 \u2010 \u2010 13.1 (7.7) Nonrecurring subsidies 2.3 \u2010 \u2010 2.3 \u2010 \u2010 \u2010 \u2010 2.3 Total 115.4 (13.7) 1.8 103.5 143.9 (94.6) (15.1) 34.2 69.3 The 2022 financial year had a lower current tax burden than the previous year; it should be noted how, against an in-line pre-tax result, in the previous one, the taxable income - and consequently tax burden - of the Group was reduced due to important non-tax-relevant components. Of particular note are the nonrecurring effects arising from the one-time concessions granted to some Group companies, in the form of tax credits, for the purchase of electricity and natural gas, pursuant to Legislative Decree n4/2022, Legislative Decree 17/2022, Legislative Decree 21/2022, known as the \u201cUkrainian Decree,\u201d Legislative Decree 50/2022, Legislative Decree 115/2022, referred to as \u201caiuti-bis,\u201d Legislative Decree 144/2022, known as \u201caiuti-ter,\u201d and Legislative Decree 176/2022, referred to as \u201caiuti-quater\u201d. Deferred tax assets mainly include the net benefit on taxes resulting from the exemption carried out pursuant to Legislative Decree no. 185/2008 (converted into L. 2/2009) of the higher values generated by the acquisition of Vallortigara Spa and Eco Gas Srl; in particular, the exemption of the equity investment in Vallortigara Spa generated tax assets of 6 million euro, against the payment of a substitute tax of 3.3 million euro, while the exemption of the equity investment in Eco Gas Srl yielded tax assets of 3.5 million euro, against the payment of a substitute tax of 2 million euro. It should be noted that, last year, this item included, in addition to the exemption of the higher values arising from the acquisition of Recycla Spa (which recognized tax assets of 6.8 million euro, against the payment of a substitute tax of 3.8 million euro), the tax benefit from the realignment of goodwill, net of the previously mentioned substitute tax paid, amounting to 77.8 million euro.
2.02.03
It should also be noted that Legislative Decree 21/2022, in order to curb the effects of the increase in
prices and tariffs in the energy sector on businesses and consumers, established for the financial year
2022 an extraordinary solidarity-oriented levy contribution, which the Group has determined to be
applicable to its activities in the amount of 2.3 million euro.
With reference to the one-time contribution and its possible application to one additional company with
respect to what has been recognized as a tax charge, while the Group deems that there is no objective
probability of its having to pay the aforementioned contribution (a conclusion supported by the opinion of
its tax advisors), albeit in a context of uncertainty surrounding the interpretation of this rule, in order to
avoid the application of penalties it considered it appropriate to proceed with the payment of an additional
9.6 million euro, subsequently proceeding to submit a request for reimbursement. Finally, the subsequent
Law 197/2022, referred to as Budget Law 2023, changed the subjective scope of this extraordinary
contribution, making what Hera Spa had already paid in the amount of 13 million euro no longer due.
The same Budget Law 2023 also established a one-time solidarity contribution, in the form of a temporary
levy, to be paid during 2023. The levy, unlike ordinary taxes, does not apply on the result produced in
the year 2022, but on the profit surplus that emerges from the comparison with previous periods.
According to the criteria for determining the tax base under the aforementioned law, it was found that
none of the companies in the Group owe this levy.
For a more consistent analysis of the tax rate trend, reference should be made to the IRES tax rate
reconciliation in the following sections, that is, to paragraph 1.04.01 \u201cIncome statement and investments\u201d
of the Directors\u2019 Report, in which both the pre-tax earnings and the tax charge have been adjusted for
special items (including the effect from the exemption shown above), in order to determine an adjusted
tax rate fully comparable with that of the previous year.
The statutory tax rate determined on the basis of the configuration of taxable income for the purposes of
IRES is equal to 24%. The reconciliation with the effective rate is shown below.
2022
2021
Nominal effect
Percentage effect
Nominal effect
Percentage effect
Earnings before taxes
408.8
406.9
IRES
Standard rate
(98.1)
(24.0)%
(97.7)
(24.0)%
IRAP deduction
0.9
0.2%
0.9
0.2%
Ace and super Ace
4.9
1.2%
5.7
1.4%
Maxi and hyper depreciation
8.0
1.9%
8.5
2.1%
IRES previous years
0.8
0.2%
2.0
0.5%
Other changes (increases and/or
decreases)
4.6
1.1%
(3.0)
(0.7)%
IRAP and other current taxes
IRAP
(27.1)
(6.6)%
(16.9)
(4.2)%
Exemption
2.6
0.6%
66.3
16.3%
Taxes
(103.5)
(25.3)%
(34.2)
(8.4)%
This reconciliation is performed only in connection with the IRES, given that, as a result of the rules
governing the IRAP, reconciliation between the statutory tax rate derived from financial statement
information and the effective tax rate is not very meaningful.
\u201cExemption\u201d mainly includes the net benefit on IRES taxes resulting from the exemption of the above-
mentioned higher valules recognized with the acquisition of Vallortigara Spa and Eco Gas Srl, amounting
to 1.6 million and 1 million euro, respectively.
The decrease in the item \u201cAce and super Ace\u201d compared to the previous year mainly reflects the end of
the window of opportunity to take advantage of the possibilities introduced by Legislative Decree 73/202
regarding the super Ace, that had allowed taxpayers to obtain a significant benefit on the tax rate. This
IRES tax rate
reconciliation
benefit no longer appears to be recognized for the 2022 tax period for which the ordinary Ace rules become applicable again, with reference to all taxable increases. The item \u201cOther changes (increases and/or decreases)\u201d increased compared to last year mainly due to the effect of extraordinary subsidies recognized in the form of tax credits by some of the Group companies against the purchase of electricity and natural gas. These contributions, introduced by the above-mentioned legislative measures enacted several times during the fiscal year, not contributing to the formation of the tax base for the period, positively affected the 2022 tax rate. In determining tax rates for the period, the Group took into due consideration the effects of the IAS tax reform introduced by Law 244 of 24 December 2007, and associated implementational decrees, the Ministerial Decree of 1 April 2009, the Ministerial Decree of 8 June 2011, and the Ministerial Decree of 10 January 2018, to coordinate international accounting standards with the rules to determine the taxable base for IRES and IRAP purposes, as per Article 4, paragraph 7-quarter,of Legislative Decree 38/2005. In particular, the reinforced derivation principle of article 83 of the Consolidated Tax Act (TUIR) was applied, which calls for entities that use IFRSs to use, including in a departure from the provisions of the TUIR, the criteria for the determination, recognition and classification in the financial statements provided for by said accounting standards. 13 Current tax assets and liabilities 31 Dec 22 31 Dec 21 Change Income tax receivables 44.8 20.3 24.5 IRES refund receivables 1.2 0.9 0.3 Total current tax assets 46.0 21.2 24.8 Income tax payables 17.1 24.2 (7.1) Substitute tax payables \u2010 3.7 (3.7) Total current tax liabilities 17.1 27.9 (10.8) \u201cIncome tax receivables\u201d refer to the excess advance IRES and IRAP payments over the tax amount payable. The significant increase over the comparison period reflects, for some relevant companies, a reduction in pre-tax profit compared with previous years. \u201cIncome tax payables\u201d includes provisions for IRES and IRAP made in relation to profit for the period. \u201cSubstitute tax payables\u201d includes payables for possible exemption transactions which have already been approved by management; the deviation from last year is due to the payment made during the 2022 financial year of the tax related to the transaction for the acquisition of the controlling interest in Recycla Spa. 14 Deferred tax assets and liabilities 31 Dec 22 31 Dec 21 Change Pre-paid tax assets 429.8 458.3 (28.5) Offsetting of deferred tax liabilities (189.6) (229.2) 39.6 Substitute tax credit 0.2 0.3 (0.1) Total net deferred tax assets 240.4 229.4 11.0 Deferred tax liabilities 405.3 361.3 44.0 Offsetting of deferred tax liabilities (189.6) (229.2) 39.6 Total net deferred tax liabilities 215.7 132.1 83.6 Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets with the corresponding current tax liabilities. The prepaid and deferred taxes relating to the year 2022 refer to the following temporary difference between the value attributed to assets and liabilities according to accounting criteria and the corresponding values for tax purposes. Deferred tax assets 2022 2021 Temporary changes Tax effect (IRES+IRAP) Equity changes Temporary changes Tax effect (IRES+IRAP) Equity changes Pre-paid taxes with effect on the income statement and the statement of comprehensive income Depreciation 686.0 178.5 701.7 183.1 Provision for bad debts 241.9 57.6 191.8 46.0 Provisions for risks and charges 209.4 56.6 189.2 51.4 Cash flow hedge 202.3 58.3 348.4 100.2 Shareholdings 182.3 51.5 170.1 47.8 Other 117.6 27.4 119.3 29.8 Total tax effect 1,639.5 429.8 0.7 1,720.5 458.3 0.3 Credited (or debited) amount to the statement of comprehensive income (42.9) 99.4 Credited (or debited) amount to the income statement 13.7 94.6 Deferred tax liabilities 2022 2021 Temporary changes Tax effect (IRES+IRAP) Equity changes Temporary changes Tax effect (IRES+IRAP) Equity changes Deferred taxes with effect on the income statement and statement of comprehensive income Depreciation 696.6 147.0 779.5 158.1 Cash flow hedge 563.6 161.9 463.4 133.1 Discounted liabilities 105.4 18.8 118.9 23.3 Provisions for risks and charges 34.3 9.9 37.6 10.9 Other 263.1 67.6 149.4 35.9 Total tax effect 1,663.0 405.3 13.3 1,548.8 361.3 19.5 Credited (or debited) amount to the statement of comprehensive income (28.9) (128.6) Credited (or debited) amount to the income statement (1.8) 15.1 \u201cEquity changes\u201d have no effect on the income statement and the statement of comprehensive income for the year, as they include the balances of deferred tax assets and liabilities arising from: \u25aa business combination operations carried out during 2022, in relation to which see the section \u201cBusiness Combinations (supplementary information)\u201d of section 2.02.10 \u201cOther information\u201d. \u25aa marginal reclassifications arising between deferred tax assets and liabilities. \u201cDeferred tax assets\u201d arise from temporary differences between the value attributed to assets and liabilities according to accounting criteria and the corresponding values for tax purposes. The decrease for the period is due to the following effects: \u25aa change for the period of the fair value of commodity derivatives classified as cash flow hedge, resulting in an asset decrease with a balancing entry in the statement of comprehensive income in the amount of 41.9 million euro. \u25aa higher net allocations to the provision for bad debts of major sales companies, resulting in an increase in tax assets amounting to 11.6 million euro. It should also be noted that last year there was a realignment of the book and tax values of goodwill recognised in the financial statements at 31 December 2019, as provided for by Article 1, paragraph 83 of the 2021 Budget Law. Deferred tax assets were recorded in the financial statements in view of the high likelihood of generating taxable income in future years which allows for the use of the deductible temporary difference. In particular, in relation to the assets recorded against the realignment of goodwill, for which tax regulations provide for annual use on a straight-line basis for a period of 50 years from the date of recording, management confirms that they are fully recoverable in view of the extension of the predictability timeframes of the regulated distribution businesses (on the basis of parameters such as the residual useful life of the assets, the extension of the concessions and their renewal likelihood), the particularly limited impact of the taxable income required to recover these deferred tax assets on the overall taxable income generated by the distribution assets with a residual useful life of several decades, as well as the tax consolidation regime under which the Group operates, which makes it possible to offset any tax losses across all businesses. \u201cDeferred tax liabilities\u201d arise from timing differences between reported profit and taxable profit. The item also includes the significant tax effects of recognising or adjusting assets and liabilities in the consolidated financial statements. The increase compared to 31 December 2021 is due to the following effects: \u25aa change for the period in the fair value of commodity derivatives classified as cash flow hedge, resulting in a liabilities increase of 28.9 million euro with a balancing entry in the statement of comprehensive income; \u25aa off-balance sheet deduction of the tax amortisation of customer list and goodwill resulting from the exemption of the higher book values implicit in the controlling shareholdings in Ascopiave Energie Spa, Ascotrade Spa, Blue Meta Spa, Etra Srl and Amgas Blu Srl; in particular, 2022 represents the first year in which the benefit resulting from the realignment, amounting to 17.2 million euro, will be enjoyed. Reporting on tax litigations IRES, IRAP and VAT Company Tax Description of litigation Status of litigation Dispu ted amou nt* Amounts paid (including provisiona lly)** Provisio ns booked in the financial stateme nt Ascotrade Spa IRES, IRAP and VAT Notice of assessment for the years between 2013 and 2017 concerning the deductibility of a number of components of the purchase cost of raw material and the irregular VAT deduction. Notice of assessment for the year 2018 concerning VAT alone. For the years 2013 and 2014, following appeals filed by the Inland Revenue Office against first instance rulings favourable to the company, proceedings are pending before the Second-instance Tax Court. For the year 2015, the judgments annulled the assessment acts in their entirety and ordered the Internal Revenue Office to reimburse the costs of the case. For the years 2016 to 2018, the company filed an appeal in February 2022. 10.1 0.7 - Hera Trading Srl IRES and \u201cRobin Tax\u201d surtax Notices of assessment for the years between 2011 and 2013 (only the latter for the Robin tax) concerning the deduction of valuation charges, net of related income, from commodity derivatives and environmental certificates. Proceedings related to the 2011 and 2013 tax years, having seen adverse rulings in the first instance, are still pending in the second instance before the applicable Tax Courts. For the 2011 tax year, an accounting expert opinion was requested from the second-degree Tax Court of Emilia Romagna; for the 2012 tax year, an unfavourable judgment was rendered to the Taxpayer by the second-degree Tax Court of Friuli Venezia Giulia. The Company has filed appeals with the Court of Cassation. 6.6 2.9 - Herambiente Spa IRAP Notices of assessment for the years from 2009 to 2013, focused on eligibility for the IRAP \u201ctax wedge\u201d relief in favour of the company. In relation to the tax years for which notices were received, proceedings are pending before the Court of Cassation following the appeals lodged in each case by the losing party (the rulings are both favourable and unfavourable to the company). 4.1 4.1 - Herambiente Spa Assessment notices for the non- application of withholding tax on dividends distributed to Ambiente Appeals have been lodged with the appropriate Tax Court in relation to the proceedings for both years. 5.1
Witholdings on dividends
Arancione U.A. and European Waste
Holding Ltd in the years 2016 and 2017
Marche Region
Multiservizi Spa
IRES and IRAP
Notices of assessment for the years
2009 and 2016 with objection to the
deduction of the provision to the landfill
post management allowance.
Proceedings for the years 2009 to 2014, following
appeals filed by the losing party against unfavourable
rulings (there are rulings both favourable and
unfavourable to the company), are pending before the
second-instance Tax Court of Ancona. The
proceeding for the year 2015 witnessed a ruling
favourable to the Company, but the Inland Revenue
has lodged an appeal and the Company appeared
before the second-degree Tax Court of the Marche
Region. Regarding the year 2016, the company has
appealed the assessment.
2.5
1.3
0.1
Inrete
Distribuzione Spa
IRES and IRAP
IRES and IRAP notices of assessment
for the year 2016 concerning the undue
deduction of discounting charges, the
erroneous determination of the maxi-
amortisation allowance regarding
charges ancillary to the installation of
smart meters, that is, the undue
deduction of employee-related costs for
the purposes of calculating IRAP.
With regard to the IRAP claim, the Company settled
the dispute with the Inland Revenue Office and paid
the tax due (of a modest amount). With regard to the
two IRES notices against which an appeal was filed,
in June 2022 the Tax Court ruled in the first instance
in favour of the company, and condemned the Inland
Revenue Office to pay expenses. The proceedings are
currently pending in the second instance. Amounts
paid on an interim basis were refunded following the
favourable first instance ruling.
0.3
-
-
Hera Luce Srl
IRES and IRAP
Notice of assessment for the year 2013
concerning the deductibility of routine
maintenance costs.
The company appealed to the second-instance Tax
Court of Emilia Romagna against the first instance
ruling of the Provincial Tax Commission of Forl\u00ec, which
annulled the penalties but confirmed the higher taxes
claimed. The date for the appeal hearing has yet to be
scheduled.
0.6
0.3
-
* \u201credetermined amount\u201d means the original amount of the claim with no interests, unless it was redetermined as a result of judicial conciliation, assessment
with adhesion, partial annulment in judicial proceedings or on self-defence.
** the amounts paid include interest, where due.
Other taxes
Company
Tax
Description
of litigation
Status
of litigation
Disput
ed
amou
nt*
Amounts
paid
(including
provisional
ly)**
Provisio
ns
booked
in the
financial
stateme
nt
Herambiente Spa
Eco-tax
Dispute documents related to the
Sommacampagna landfill for the
periods 2014-2017.
The proceedings are pending before the relevant first-
instance Tax Courts for the tax periods of 2014, 2016
and 2017. With respect to the 2015 tax period, a
favourable ruling for the company was issued with a
recalculation of the penalties. Deadlines for filing an
appeal with the applicable second-degree Tax
Commission are pending.
7.0
-
-
Herambiente Spa
ICI/IMU
Notices of assessment for the years
2008 to 2017 following the re-
classification in the real estate registry
of the Ferrara waste-to-energy plant.
The proceedings were concluded for the 2008-2013
notices with a ruling favourable to the Company, while
they are still pending before the first-instance Tax
Court for the remaining years.
2.8
-
2.6
Herambiente Spa
ICI/IMU
Notices of assessment for the years
between 2011 and 2020 concerning the
classification in the real estate registry
of land, facilities and buildable areas
located in Ravenna.
For the years 2011-2015, the second instance
judgment was partially favourable to the company; the
deadlines for filing appeals to the Court of Cassation
are pending. For the 2016-2020 periods, the first
instance ruling was unfavourable to the company, and
the case is pending at the second-instance Tax Court.
During 2022, the company finished paying what it
owed in relation to the 2018 settlement.
2.6
-
2.3
Herambiente Spa
ICI/IMU
Notices of assessment for the years
between 2013 and 2019 concerning the
waste to energy plant and the recycling
plant located in the municipality of
Coriano.
For the years 2013-2015, the cases are pending partly
in the first instance Tax Court of Rimini (2013) and
partly in the second-instance Court of Emilia-
Romagna (2014 and 2015). Assessments for the
years 2016-2019 with the second-degree Tax Court
are pending.
1.2
0.1
1.2
AcegasApsAmga Spa
Technical-administrative audit of the
Padua and Trieste waste-to-energy
plants carried out by the Customs
Agency for the years 2012 to 2015 in
Proceedings on the Padua waste-to-energy plant are
pending in the Court of Cassation following the
company\u2019s appeal against the ruling against it on
appeal. The Tax Court of Friuli Venezia Giulia upheld
2.1
1.0
-
Excise on self-consumption relation to the installation of measuring instruments for detecting electricity produced and used for self- consumption and associated payment of the excise. the company\u2019s argument in a ruling dated 21 April 2022 in relation to its entitlement to the subsidised excise tax with regard to the Trieste waste-to-energy plant. Notices of assessment for the tax periods from 2013 to 2017, notified by the Municipality of Riccione for the permanent occupation of public land with waste bins. The TOSAP proceedings for the years between 2013 and 2016 are pending before the second-instance Regional Tax Court of Emilia-Romagna, while the COSAP proceedings for the year 2017 are pending before the Appeals Court of Bologna. The first- instance ruling is partially in favour of the company. 1.2 1.2 2.2 Hera Spa COSAP/TOSAP COSAP notice of objection for the tax periods from 2018 and 2019, notified by the Municipality of Riccione for the permanent occupation of public land with waste bins. The proceedings are pending before the Civil Court of Rimini. 2.1 - TOSAP notices of assessment for the tax years 2014-2018, notified by the Municipality of Coriano for the permanent occupation of public land with waste bins. The proceedings for the year 2014 are currently pending before the second-degree Regional Tax Court of Emilia-Romagna, while the appeal for the year 2015 is pending before the first-degree Tax Court of Rimini. Regarding the notices for 2016, 2017, and 2018, first- instance hearings have been held and the filing of rulings is pending. 0.9 - * \u201credetermined amount\u201d means the original amount of the claim with no interests, unless it was redetermined as a result of judicial conciliation, assessment with adhesion, partial annulment in judicial proceedings or on self-defence. ** the amounts paid include interest, where due. With reference to the disputes in question, having consulted its lawyers, the Group has decided to make the provisions indicated. In cases in which no provision has been made, the alleged violations have been deemed groundless.", "dimensions": { "concept": "ifrs-full:DisclosureOfIncomeTaxExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-49": { "value": "13 Current tax assets and liabilities 31 Dec 22 31 Dec 21 Change Income tax receivables 44.8 20.3 24.5 IRES refund receivables 1.2 0.9 0.3 Total current tax assets 46.0 21.2 24.8 Income tax payables 17.1 24.2 (7.1) Substitute tax payables \u2010 3.7 (3.7) Total current tax liabilities 17.1 27.9 (10.8) \u201cIncome tax receivables\u201d refer to the excess advance IRES and IRAP payments over the tax amount payable. The significant increase over the comparison period reflects, for some relevant companies, a reduction in pre-tax profit compared with previous years. \u201cIncome tax payables\u201d includes provisions for IRES and IRAP made in relation to profit for the period. \u201cSubstitute tax payables\u201d includes payables for possible exemption transactions which have already been approved by management; the deviation from last year is due to the payment made during the 2022 financial year of the tax related to the transaction for the acquisition of the controlling interest in Recycla Spa. ", "dimensions": { "concept": "ifrs-full:DisclosureOfTaxReceivablesAndPayablesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-416": { "value": "14 Deferred tax assets and liabilities 31 Dec 22 31 Dec 21 Change Pre-paid tax assets 429.8 458.3 (28.5) Offsetting of deferred tax liabilities (189.6) (229.2) 39.6 Substitute tax credit 0.2 0.3 (0.1) Total net deferred tax assets 240.4 229.4 11.0 Deferred tax liabilities 405.3 361.3 44.0 Offsetting of deferred tax liabilities (189.6) (229.2) 39.6 Total net deferred tax liabilities 215.7 132.1 83.6 Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets with the corresponding current tax liabilities. The prepaid and deferred taxes relating to the year 2022 refer to the following temporary difference between the value attributed to assets and liabilities according to accounting criteria and the corresponding values for tax purposes. Deferred tax assets 2022 2021 Temporary changes Tax effect (IRES+IRAP) Equity changes Temporary changes Tax effect (IRES+IRAP) Equity changes Pre-paid taxes with effect on the income statement and the statement of comprehensive income Depreciation 686.0 178.5 701.7 183.1 Provision for bad debts 241.9 57.6 191.8 46.0 Provisions for risks and charges 209.4 56.6 189.2 51.4 Cash flow hedge 202.3 58.3 348.4 100.2 Shareholdings 182.3 51.5 170.1 47.8 Other 117.6 27.4 119.3 29.8 Total tax effect 1,639.5 429.8 0.7 1,720.5 458.3 0.3 Credited (or debited) amount to the statement of comprehensive income (42.9) 99.4 Credited (or debited) amount to the income statement 13.7 94.6 Deferred tax liabilities 2022 2021 Temporary changes Tax effect (IRES+IRAP) Equity changes Temporary changes Tax effect (IRES+IRAP) Equity changes Deferred taxes with effect on the income statement and statement of comprehensive income Depreciation 696.6 147.0 779.5 158.1 Cash flow hedge 563.6 161.9 463.4 133.1 Discounted liabilities 105.4 18.8 118.9 23.3 Provisions for risks and charges 34.3 9.9 37.6 10.9 Other 263.1 67.6 149.4 35.9 Total tax effect 1,663.0 405.3 13.3 1,548.8 361.3 19.5 Credited (or debited) amount to the statement of comprehensive income (28.9) (128.6) Credited (or debited) amount to the income statement (1.8) 15.1 \u201cEquity changes\u201d have no effect on the income statement and the statement of comprehensive income for the year, as they include the balances of deferred tax assets and liabilities arising from: \u25aa business combination operations carried out during 2022, in relation to which see the section \u201cBusiness Combinations (supplementary information)\u201d of section 2.02.10 \u201cOther information\u201d. \u25aa marginal reclassifications arising between deferred tax assets and liabilities. \u201cDeferred tax assets\u201d arise from temporary differences between the value attributed to assets and liabilities according to accounting criteria and the corresponding values for tax purposes. The decrease for the period is due to the following effects: \u25aa change for the period of the fair value of commodity derivatives classified as cash flow hedge, resulting in an asset decrease with a balancing entry in the statement of comprehensive income in the amount of 41.9 million euro. \u25aa higher net allocations to the provision for bad debts of major sales companies, resulting in an increase in tax assets amounting to 11.6 million euro. It should also be noted that last year there was a realignment of the book and tax values of goodwill recognised in the financial statements at 31 December 2019, as provided for by Article 1, paragraph 83 of the 2021 Budget Law. Deferred tax assets were recorded in the financial statements in view of the high likelihood of generating taxable income in future years which allows for the use of the deductible temporary difference. In particular, in relation to the assets recorded against the realignment of goodwill, for which tax regulations provide for annual use on a straight-line basis for a period of 50 years from the date of recording, management confirms that they are fully recoverable in view of the extension of the predictability timeframes of the regulated distribution businesses (on the basis of parameters such as the residual useful life of the assets, the extension of the concessions and their renewal likelihood), the particularly limited impact of the taxable income required to recover these deferred tax assets on the overall taxable income generated by the distribution assets with a residual useful life of several decades, as well as the tax consolidation regime under which the Group operates, which makes it possible to offset any tax losses across all businesses. \u201cDeferred tax liabilities\u201d arise from timing differences between reported profit and taxable profit. The item also includes the significant tax effects of recognising or adjusting assets and liabilities in the consolidated financial statements. The increase compared to 31 December 2021 is due to the following effects: \u25aa change for the period in the fair value of commodity derivatives classified as cash flow hedge, resulting in a liabilities increase of 28.9 million euro with a balancing entry in the statement of comprehensive income; \u25aa off-balance sheet deduction of the tax amortisation of customer list and goodwill resulting from the exemption of the higher book values implicit in the controlling shareholdings in Ascopiave Energie Spa, Ascotrade Spa, Blue Meta Spa, Etra Srl and Amgas Blu Srl; in particular, 2022 represents the first year in which the benefit resulting from the realignment, amounting to 17.2 million euro, will be enjoyed.", "dimensions": { "concept": "ifrs-full:DisclosureOfTemporaryDifferenceUnusedTaxLossesAndUnusedTaxCreditsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-48": { "value": "14 Deferred tax assets and liabilities 31 Dec 22 31 Dec 21 Change Pre-paid tax assets 429.8 458.3 (28.5) Offsetting of deferred tax liabilities (189.6) (229.2) 39.6 Substitute tax credit 0.2 0.3 (0.1) Total net deferred tax assets 240.4 229.4 11.0 Deferred tax liabilities 405.3 361.3 44.0 Offsetting of deferred tax liabilities (189.6) (229.2) 39.6 Total net deferred tax liabilities 215.7 132.1 83.6 The prepaid and deferred taxes relating to the year 2022 refer to the following temporary difference between the value attributed to assets and liabilities according to accounting criteria and the corresponding values for tax purposes. Deferred tax assets 2022 2021 Temporary changes Tax effect (IRES+IRAP) Equity changes Temporary changes Tax effect (IRES+IRAP) Equity changes Pre-paid taxes with effect on the income statement and the statement of comprehensive income Depreciation 686.0 178.5 701.7 183.1 Provision for bad debts 241.9 57.6 191.8 46.0 Provisions for risks and charges 209.4 56.6 189.2 51.4 Cash flow hedge 202.3 58.3 348.4 100.2 Shareholdings 182.3 51.5 170.1 47.8 Other 117.6 27.4 119.3 29.8 Total tax effect 1,639.5 429.8 0.7 1,720.5 458.3 0.3 Credited (or debited) amount to the statement of comprehensive income (42.9) 99.4 Credited (or debited) amount to the income statement 13.7 94.6 Deferred tax liabilities 2022 2021 Temporary changes Tax effect (IRES+IRAP) Equity changes Temporary changes Tax effect (IRES+IRAP) Equity changes Deferred taxes with effect on the income statement and statement of comprehensive income Depreciation 696.6 147.0 779.5 158.1 Cash flow hedge 563.6 161.9 463.4 133.1 Discounted liabilities 105.4 18.8 118.9 23.3 Provisions for risks and charges 34.3 9.9 37.6 10.9 Other 263.1 67.6 149.4 35.9 Total tax effect 1,663.0 405.3 13.3 1,548.8 361.3 19.5 Credited (or debited) amount to the statement of comprehensive income (28.9) (128.6) Credited (or debited) amount to the income statement (1.8) 15.1 \u201cEquity changes\u201d have no effect on the income statement and the statement of comprehensive income for the year, as they include the balances of deferred tax assets and liabilities arising from: \u25aa business combination operations carried out during 2022, in relation to which see the section \u201cBusiness Combinations (supplementary information)\u201d of section 2.02.10 \u201cOther information\u201d. \u25aa marginal reclassifications arising between deferred tax assets and liabilities. \u201cDeferred tax assets\u201d arise from temporary differences between the value attributed to assets and liabilities according to accounting criteria and the corresponding values for tax purposes. The decrease for the period is due to the following effects: \u25aa change for the period of the fair value of commodity derivatives classified as cash flow hedge, resulting in an asset decrease with a balancing entry in the statement of comprehensive income in the amount of 41.9 million euro. \u25aa higher net allocations to the provision for bad debts of major sales companies, resulting in an increase in tax assets amounting to 11.6 million euro. It should also be noted that last year there was a realignment of the book and tax values of goodwill recognised in the financial statements at 31 December 2019, as provided for by Article 1, paragraph 83 of the 2021 Budget Law. Deferred tax assets were recorded in the financial statements in view of the high likelihood of generating taxable income in future years which allows for the use of the deductible temporary difference. In particular, in relation to the assets recorded against the realignment of goodwill, for which tax regulations provide for annual use on a straight-line basis for a period of 50 years from the date of recording, management confirms that they are fully recoverable in view of the extension of the predictability timeframes of the regulated distribution businesses (on the basis of parameters such as the residual useful life of the assets, the extension of the concessions and their renewal likelihood), the particularly limited impact of the taxable income required to recover these deferred tax assets on the overall taxable income generated by the distribution assets with a residual useful life of several decades, as well as the tax consolidation regime under which the Group operates, which makes it possible to offset any tax losses across all businesses. \u201cDeferred tax liabilities\u201d arise from timing differences between reported profit and taxable profit. The item also includes the significant tax effects of recognising or adjusting assets and liabilities in the consolidated financial statements. The increase compared to 31 December 2021 is due to the following effects: \u25aa change for the period in the fair value of commodity derivatives classified as cash flow hedge, resulting in a liabilities increase of 28.9 million euro with a balancing entry in the statement of comprehensive income; \u25aa off-balance sheet deduction of the tax amortisation of customer list and goodwill resulting from the exemption of the higher book values implicit in the controlling shareholdings in Ascopiave Energie Spa, Ascotrade Spa, Blue Meta Spa, Etra Srl and Amgas Blu Srl; in particular, 2022 represents the first year in which the benefit resulting from the realignment, amounting to 17.2 million euro, will be enjoyed.", "dimensions": { "concept": "ifrs-full:DisclosureOfDeferredTaxesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-443": { "value": "Net equity 15 Group net equity 31 Dec 22 31 Dec 21 Change Share capital (nominal value) 1,489.5 1,489.5 \u2010 Treasury share reserve (38.5) (29.2) (9.3) Share capital increase costs (0.7) (0.7) \u2010 Share capital 1,450.3 1,459.6 (9.3) Legal reserve 120.3 109.1 11.2 Other reserves 1,409.1 1,269.9 139.2 Components of Comprehensive Income (OCI) 207.1 54.3 152.8 Reserve for treasury share transactions (43.6) (26.2) (17.4) Reserves 1,692.9 1,407.1 285.8 Profit (loss) for the period 255.2 333.5 (78.3) Total 3,398.4 3,200.2 198.2 The share capital at 31 December 2022 amounted to 1,489,538,745 ordinary shares with a nominal value of 1 euro each and is fully paid-up. The number of treasury shares held by the Group at 31 December 2022 was 38,541,380 (29,217,962 at 31 December 2021). The item reserves consists of: \u25aa the legal reserve of the parent company Hera Spa, which increased as a result of the allocation of the previous year\u2019s earnings as resolved by the Shareholders\u2019 Meeting when approving the financial statements at 31 December 2021; \u25aa other reserves reflecting the profits generated in previous years and reserves established on capital contributions or equity investments; \u25aa components of other comprehensive income (OCI) mainly representing cash flow hedge reserves related to gas and electricity commodity transaction hedges; \u25aa the reserve for treasury share transactions reflecting transactions on treasury shares at 31 December 2022. Changes over the course of the financial year generated an overall capital gain in the amount of approximately 0.1 million euro. ", "dimensions": { "concept": "ifrs-full:DisclosureOfShareCapitalReservesAndOtherEquityInterestExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-465": { "value": "15 Group net equity 31 Dec 22 31 Dec 21 Change Share capital (nominal value) 1,489.5 1,489.5 \u2010 Treasury share reserve (38.5) (29.2) (9.3) Share capital increase costs (0.7) (0.7) \u2010 Share capital 1,450.3 1,459.6 (9.3) Legal reserve 120.3 109.1 11.2 Other reserves 1,409.1 1,269.9 139.2 Components of Comprehensive Income (OCI) 207.1 54.3 152.8 Reserve for treasury share transactions (43.6) (26.2) (17.4) Reserves 1,692.9 1,407.1 285.8 Profit (loss) for the period 255.2 333.5 (78.3) Total 3,398.4 3,200.2 198.2 The share capital at 31 December 2022 amounted to 1,489,538,745 ordinary shares with a nominal value of 1 euro each and is fully paid-up. The number of treasury shares held by the Group at 31 December 2022 was 38,541,380 (29,217,962 at 31 December 2021). The item reserves consists of: \u25aa the legal reserve of the parent company Hera Spa, which increased as a result of the allocation of the previous year\u2019s earnings as resolved by the Shareholders\u2019 Meeting when approving the financial statements at 31 December 2021; \u25aa other reserves reflecting the profits generated in previous years and reserves established on capital contributions or equity investments; \u25aa components of other comprehensive income (OCI) mainly representing cash flow hedge reserves related to gas and electricity commodity transaction hedges; \u25aa the reserve for treasury share transactions reflecting transactions on treasury shares at 31 December 2022. Changes over the course of the financial year generated an overall capital gain in the amount of approximately 0.1 million euro. ", "dimensions": { "concept": "ifrs-full:DisclosureOfReservesAndOtherEquityInterestExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-50": { "value": "The number of treasury shares held by the Group at 31 December 2022 was 38,541,380 (29,217,962 at 31 December 2021). \u25aa the reserve for treasury share transactions reflecting transactions on treasury shares at 31 December 2022. Changes over the course of the financial year generated an overall capital gain in the amount of approximately 0.1 million euro.", "dimensions": { "concept": "ifrs-full:DisclosureOfTreasurySharesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-51": { "value": "16 Non-controlling interests 31 Dec 22 31 Dec 21 Change Share capital and reserves 197.4 179.5 17.9 Components of Other Comprehensive Income (OCI) (1.2) (2.0) 0.8 Profit (loss) for the period 50.1 39.1 11.0 Total 246.3 216.6 29.7 This item mainly comprises the minority equity interests of the Herambiente Group and the Marche Multiservizi Group. With reference to the acquisition of non-total controlling interests carried out in recent years through business combinations, the contractual agreements entered into by the Group provide for minority shareholders to be granted irrevocable put options, to be exercised within specific time windows. According to the provisions of IAS 32, the existence of such a right held by the minority shareholders has led to the need to classify options on shares/interests in acquired companies held by minority shareholders in the consolidated financial statements as a financial liability, thus considering the relative shareholdings to be fully owned. For additional details on the calculation of fair value of put option debt, please refer to note 19 \u201cFinancial liabilities\u201d. Net income attributable to minority shareholders shows a significant increase over the previous period, mainly due to the improved results of the energy services and waste treatment businesses, partly as a result of the acquisitions made in the second half of 2021 and during the 2022 financial year. Reconciliation statement The following is a reconciliation between the Parent Company\u2019s separate financial statements and the consolidated financial statement. Net Profit Net equity Balances as per parent company\u2019s financial statements 271.0 2,530.3 Excess of shareholders\u2019 equity reported in the financial statements for the period over the carrying amounts of investments in consolidated companies (6.1) 931.2 Consolidation adjustments: net equity valuation of companies recognised in the separate financial statements at cost (1.3) 44.5 difference between purchase price and corresponding net book equity (20.7) (82.1) elimination of intra-group transaction effects 12.3 (25.5) Total 255.2 3,398.4 Allocation of third-party holdings 50.1 246.3 Balances as per consolidated financial statement 305.3 3,644.7", "dimensions": { "concept": "ifrs-full:DisclosureOfNoncontrollingInterestsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-52": { "value": "17 Earnings per share 2022 2021 Profit or loss for the period attributable to holders of ordinary shares of the parent entity (A) 255.2 333.5 Weighted average number of shares outstanding for the purposes of calculation of earnings (loss) per share basic (B) 1,454,636,032 1,461,238,457 diluted (C) 1,454,636,032 1,461,238,457 Earnings (loss) per share (in euro) basic (A/B) 0.175 0.228 diluted (A/C) 0.175 0.228 Basic earnings per share are calculated on the operating result attributable to holders of ordinary shares of the parent company. Diluted earnings per share are equal to the basic as there are no classes of shares other than ordinary shares and there are no instruments that can be converted into shares. At the writing of this consolidated financial statement, the share capital of the parent company Hera Spa consisted of 1,489,538,745 ordinary shares, unchanged from 31 December 2021, which were used in determining basic and diluted earnings per share. ", "dimensions": { "concept": "ifrs-full:DisclosureOfEarningsPerShareExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-444": { "value": "18 Financial assets, cash holdings and cash equivalents 31 Dec 22 31 Dec 21 Change Loan receivables 27.0 35.8 (8.8) Receivables for construction services 80.4 59.2 21.2 Portfolio securities 2.0 1.9 0.1 Other financial receivables 42.4 45.8 (3.4) Total non-current financial assets 151.8 142.7 9.1 Loan receivables 7.2 5.8 1.4 Other financial receivables 70.5 23.5 47.0 Total current financial assets 77.7 29.3 48.4 Total cash holdings 1,942.4 885.6 1,056.8 Total financial assets and cash holdings 2,171.9 1,057.6 1,114.3
\u201cLoan receivables\u201d, comprises loans, regulated at market rate, made to the following companies:
31 Dec 22
31 Dec 21
Non-current
portion
Current
portion
Total
Non-current
portion
Current
portion
Total
Aloe SpA
5.4
0.8
6.2
6.1
0.8
6.9
Calenia Energia Spa
3.3
\u2010
3.3
7.1
0.3
7.4
Set Spa
12.2
3.2
15.4
15.4
3.1
18.5
Other minor companies
6.1
3.2
9.3
7.2
1.6
8.8
Total
27.0
7.2
34.2
35.8
5.8
41.6
Loans to companies that are vehicles through which the Group owns production quotas for electricity
generation plants (Set Spa and Tamarete Energia Srl) were tested for impairment, the result of which
did not lead to changes in the carrying values during the 2022 financial year, as explained in Note 27
\u201cImpairment test equity investments.\u201d
\u201cReceivables for construction services\u201d from municipalities for the construction of public lighting systems
identified in keeping with the financial asset model provided by the IFRIC 12 interpretation, as shown in
greater detail in the section describing the evaluation criteria for the item \u201cLoans and receivables\u201d in
section 2.02.01 \u201cIntroduction\u201d.
\u201cPortfolio securities\u201d mainly include bonds, funds and insurance policies guaranteeing the post-mortem
management of the landfill held by the subsidiary Asa Scpa, amounting to 1.9 million euro, the book
value of which is substantially in line with the fair value at the end of the year. These securities are
measured at fair value through other comprehensive income components.
\u201cOther financial receivables\u201d include the following counterparties:
31 Dec 22
31 Dec 21
Non-current
portion
Current portion
Total
Non-current
portion
Current portion
Total
Municipality of Padua
12.1
1.5
13.6
13.6
2.2
15.8
Collinare Consortium
13.0
\u2010
13.0
12.1
\u2010
12.1
Acosea Impianti Srl
12.7
\u2010
12.7
12.6
\u2010
12.6
Cato and Veneto Region
\u2010
7.0
7.0
\u2010
9.8
9.8
ex-CMV municipalities
3.9
\u2010
3.9
3.9
\u2010
3.9
Other financial receivables
0.7
62.0
62.7
3.6
11.5
15.1
Total
42.4
70.5
112.9
45.8
23.5
69.3
\u25aa The Municipality of Padua is mainly related to the construction of photovoltaic systems. The
repayment of this credit, which is regulated at a market rate, is scheduled at the end of 2030;
\u25aa The item Collinare Consortium represents the compensation owed to the outgoing provider when the
gas distribution services contract comes to an end;
\u25aa Acosea Impianti Srl refers to a security deposit left with the parent company Hera Spa;
\u25aa Cato and Veneto Region reflects government grants that will be collected after the balance sheet
date;
\u25aa Ex-CMV municipalities concerns the compensation due to the outgoing operator at the end of the
concession of the management of gas distribution service in the municipalities of Vigarano, Goro and
Castello d'Argile;
\u25aa Other financial receivables include transactions for the assignment of energy efficiency tax credits
concluded at the end of fiscal year 2022, formally validated and accepted by the bank counterparties,
the collection of which took place in January 2023, amounting to 46.3 million euro. This item also includes advances paid by the Group\u2019s distribution companies for participation in gas tenders to be held in the coming years, amounting to 4.3 million euro (4.7 million euro at 31 December 2021). \u201cCash and cash equivalents\u201d include almost exclusively bank and postal deposits (1,941.8 million at 31 December 2022). To better understand the change in the amount of cash and cash equivalents, please refer to the cash flow statement schedule. ", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialAssetsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-438": { "value": "18 Financial assets, cash holdings and cash equivalents 31 Dec 22 31 Dec 21 Change Loan receivables 27.0 35.8 (8.8) Receivables for construction services 80.4 59.2 21.2 Portfolio securities 2.0 1.9 0.1 Other financial receivables 42.4 45.8 (3.4) Total non-current financial assets 151.8 142.7 9.1 Loan receivables 7.2 5.8 1.4 Other financial receivables 70.5 23.5 47.0 Total current financial assets 77.7 29.3 48.4
Total cash holdings
1,942.4
885.6
1,056.8
Total financial assets and cash holdings
2,171.9
1,057.6
1,114.3
\u201cLoan receivables\u201d, comprises loans, regulated at market rate, made to the following companies: 31 Dec 22 31 Dec 21 Non-current portion Current portion Total Non-current portion Current portion Total Aloe SpA 5.4 0.8 6.2 6.1 0.8 6.9 Calenia Energia Spa 3.3 \u2010 3.3 7.1 0.3 7.4 Set Spa 12.2 3.2 15.4 15.4 3.1 18.5 Other minor companies 6.1 3.2 9.3 7.2 1.6 8.8 Total 27.0 7.2 34.2 35.8 5.8 41.6 Loans to companies that are vehicles through which the Group owns production quotas for electricity generation plants (Set Spa and Tamarete Energia Srl) were tested for impairment, the result of which did not lead to changes in the carrying values during the 2022 financial year, as explained in Note 27 \u201cImpairment test equity investments.\u201d \u201cReceivables for construction services\u201d from municipalities for the construction of public lighting systems identified in keeping with the financial asset model provided by the IFRIC 12 interpretation, as shown in greater detail in the section describing the evaluation criteria for the item \u201cLoans and receivables\u201d in section 2.02.01 \u201cIntroduction\u201d. \u201cPortfolio securities\u201d mainly include bonds, funds and insurance policies guaranteeing the post-mortem management of the landfill held by the subsidiary Asa Scpa, amounting to 1.9 million euro, the book value of which is substantially in line with the fair value at the end of the year. These securities are measured at fair value through other comprehensive income components. \u201cOther financial receivables\u201d include the following counterparties: 31 Dec 22 31 Dec 21 Non-current portion Current portion Total Non-current portion Current portion Total Municipality of Padua 12.1 1.5 13.6 13.6 2.2 15.8 Collinare Consortium 13.0 \u2010 13.0 12.1 \u2010 12.1 Acosea Impianti Srl 12.7 \u2010 12.7 12.6 \u2010 12.6 Cato and Veneto Region \u2010 7.0 7.0 \u2010 9.8 9.8 ex-CMV municipalities 3.9 \u2010 3.9 3.9 \u2010 3.9 Other financial receivables 0.7 62.0 62.7 3.6 11.5 15.1 Total 42.4 70.5 112.9 45.8 23.5 69.3 \u25aa The Municipality of Padua is mainly related to the construction of photovoltaic systems. The repayment of this credit, which is regulated at a market rate, is scheduled at the end of 2030; \u25aa The item Collinare Consortium represents the compensation owed to the outgoing provider when the gas distribution services contract comes to an end; \u25aa Acosea Impianti Srl refers to a security deposit left with the parent company Hera Spa; \u25aa Cato and Veneto Region reflects government grants that will be collected after the balance sheet date; \u25aa Ex-CMV municipalities concerns the compensation due to the outgoing operator at the end of the concession of the management of gas distribution service in the municipalities of Vigarano, Goro and Castello d'Argile; \u25aa Other financial receivables include transactions for the assignment of energy efficiency tax credits concluded at the end of fiscal year 2022, formally validated and accepted by the bank counterparties, the collection of which took place in January 2023, amounting to 46.3 million euro. This item also includes advances paid by the Group\u2019s distribution companies for participation in gas tenders to be held in the coming years, amounting to 4.3 million euro (4.7 million euro at 31 December 2021). \u201cCash and cash equivalents\u201d include almost exclusively bank and postal deposits (1,941.8 million at 31 December 2022). To better understand the change in the amount of cash and cash equivalents, please refer to the cash flow statement schedule. ", "dimensions": { "concept": "ifrs-full:DisclosureOfCashAndCashEquivalentsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-466": { "value": "\u201cCash and cash equivalents\u201d include almost exclusively bank and postal deposits (1,941.8 million at 31 December 2022). To better understand the change in the amount of cash and cash equivalents, please refer to the cash flow statement schedule. ", "dimensions": { "concept": "ifrs-full:DisclosureOfDepositsFromBanksExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-445": { "value": "19 Financial liabilities 31 Dec 22 31 Dec 21 Change Bonds and loans 5,171.5 3,105.9 2,065.6 Minority shareholder\u2019 put option 499.5 585.2 (85.7) Payables to acquire controlling shareholdings and potential consideration 17.4 23.0 (5.6) Other financial liabilities 1.5 1.9 (0.4) Total non-current financial liabilities 5,689.9 3,716.0 1,973.9 Overdrafts and interest liabilities 316.6 64.8 251.8 Bonds and loans 87.1 56.1 31.0 Payables to acquire controlling shareholdings and potential consideration 13.3 2.2 11.1 Minority shareholders\u2019 put option 1.7 - 1.7 Other financial liabilities 231.4 376.6 (145.2) Total current financial liabilities 650.1 499.7 150.4 Total financial liabilities 6,340.0 4,215.7 2,124.3 \u201dBonds and loans\u201d for the non-current part, changed mainly due to the overall net effect of the following: \u25aa issuance of the third green bond by the Group, which is part of the sustainability strategy aimed at financing or refinancing various projects, already carried out or planned in the business plan, selected on the basis of the provisions of the Green financing framework. the new bond, which is listed on the regulated markets of the Irish, Luxembourg and Italian stock exchanges, has a nominal value of 500 million euro, a duration of 7 years and an annual coupon of 2.5%. For further details regarding the new issuance, reference should be made to chapter 1.03 \u201cMain significant events\u201d in the Directors\u2019 report; \u25aa use of a medium/long-term credit line, as a term loan bullet granted in pool by the main banks working with the Group, amounting to 450 million euro. This financing is backed by a guarantee issued by Sace Spa (based on Article 15 of Legislative Decree No. 50 of 17 May 2022, subsequently converted into law) and is regulated by a variable interest rate; \u25aa subscription during the year of various loans with leading banks totalling 1,175 million euro, at both fixed and floating rates, with bullet repayment and an average term of approximately two years; \u25aa classification in the current portion of a bond loan with a remaining face value of 22 million euro, maturing in May 2023. The item also includes the value of the put option, in the amount of 54.8 million euro, related to Ascopiave Spa\u2019s 3% minority shareholding in Hera Comm Spa which, as a result of the contractual provisions, is classified as a loan and valued according to the depreciated cost method. This debt, with a nominal value of 54 million euro, increased due to the financial evaluation component and decreased due to dividends paid out: Opening value Financial expenses Flows paid out Terminal value 2021 financial year 54.5 3.2 (2.7) 55.0 2022 financial year 55.0 3.2 (3.4) 54.8 The current portion of \u201cBonds and loans\u201d includes the portions of medium- and long-term debts due within the next fiscal year, as well as the bond coming due in May. The main conditions of the bonds outstanding at 31 December 2022 are as follows: Bonds Duration (years) Maturity Nominal value (mn/\u20ac) Coupon Rate Sustainability linked bond 12.5 25 Apr 2034 500 Eur Annual 1.00% Bond 10 22 May 2023 22 Eur Annual 3.375% Green bond 10 04 Jul 2024 288.3 Eur Annual 2.375% Bond* 15 05 Aug 2024 20,000 JPY Six monthly 2.93% Bond 12 22 May 2025 15 Eur Annual 3.5% Green bond 7 25-mag-2029 500 Eur Annual 2.5% Bond 10 14 Oct 2026 325.44 Eur Annual 0.875% Bond 10 03 Dec 2030 500 Eur Annual 0.25% Bond* 15/20 14 May 2027/2032 102.5 Eur Annual 5.25% Green bond 8 05 Jul 2027 357.2 Eur Annual 0.875% Bond 15 29 Jan 2028 599.02 Eur Annual 5.20% * Unlisted instrument At 31 December 2022, the outstanding bonds, totalling a face value of 3,359.2 million euro (2,859.2 at 31 December 2021) and recorded at discounted cost of 3,221.4 million euro, have a fair value of 2,986.8 million euro (3,100.7 at 31 December 2021) determined by market quotations where available. There are covenants on some loans that require compliance with the corporate rating limit, which must be rated, even only by a single rating agency, no lower than investment grade (BBB-). As of the balance sheet date this covenant has been complied with. \u201cMinority shareholders\u2019 put option\u201d includes the fair value measurement of the sale options that are granted, with specific contractual arrangements, to minority shareholders on their own shares. The most significant value refers to the sale option on the non-controlling shares in EstEnergy Spa, equal to 40% of the share capital, held by Ascopiave Spa. The policy of the Group provides not to represent the holdings of minority shareholders in the result component for the period, therefore in evaluating the value of the debt for the options (to be paid at the date of exercising the option according to the contractual mechanism agreed between the parties) increased of the dividends that are expected to be distributed by the subsidiary companies along the hypothetical life of the options themselves. The fair value recognised as a liability in the balance sheet is therefore not only the present value of the expected price of the put option at the date of it is exercised, but also contains the discounted estimate of future dividends distributed as part of the variable consideration due to the counterparty. Given the structure of the operation, during the period in which the option is exercised, the profit generated by the subsidiary companies will be distributed according to their respective nominal shareholdings. This mechanism means that the portion of the fair value of the put option that will be settled through the distribution of future dividends is actually self-liquidating, since the necessary financial resources (i.e. dividends of non-controlling shareholdings) will be directly generated by the subsidiary companies, without thus determining during that period a real additional financial need for the Group.
Bonds Bonds
Put option
The following are the changes for the year, compared with the previous period: Opening value Acquisitions Financial Expenses Hypothesis change Flows paid out Terminal value 31 Dec 21 Put options (equity value) 403.4 21.8 14.5 3.2 \u2010 442.9 Put options (future dividends) 153.0 3.7 5.4 (2.5) (17.2) 142.3 Total 556.4 25.5 19.8 0.7 (17.2) 585.2 31 Dec 22 Put options (equity value) 442.9 6.9 15.4 35.0 (79.0) 421.2 Put options (future dividends) 142.3 2.2 5.1 (47.6) (21.9) 80.0 Total 585.2 9.0 20.5 (12.6) (100.9) 501.2 Regarding the changes occurring during the year: \u25aa acquisitions result from the extraordinary transactions concluded during the fiscal year that involve granting the counterparty an option on the non-controlling interest. During 2022, in particular, these values are attributable to the acquisition of Macero Maceratese Srl and the \u201cNonantola\u201d branch; \u25aa financial charges include the notional effects of discounting the debt recorded at the previous balance sheet date; \u25aa the changes in assumptions represent the effects of updating the values underlying the determination of the fair value of the options themselves, the period value of which refers to the option on the non- controlling interests in EstEnergy Spa. Specifically, the fair value of the option is calculated with reference to the future scenario of exercising the option deemed to be the most likely by the management, taking into account options that were exercised in part, in line with the updated planning assumptions, adopting applied multiples to margin indicators in accordance with the conditions agreed between the parties and discounting the corresponding future cash flows, using as a discount rate the average cost of the Group\u2019s long-term debt at the date of the transaction. This revised estimate resulted in the recognition of income from the fair value measurement of financial liabilities in the amount of 12.6 million euro; \u25aa the flows paid out include the amounts paid to minority shareholders both for exercising the options themselves (equity value) and for the payment of dividends belonging to them. During 2022, Ascopiave Spa partially exercised the put option it held, resulting in the sale to Hera Comm Spa of 8% of the shares in EstEnergy Spa for a countervalue of 79 million euro. \u201cPayables to acquire controlling shareholdings and potential consideration\u201d include the amounts still to be paid to transferor shareholders as part of the business combination transactions concluded in the period or in previous periods, as well as the estimate of the potential payments (earn-out) foreseen by the agreements signed at the time of the acquisition. The following is a breakdown of the item at 31 December 2022 by individual acquisition, compared with the previous period: 31 Dec 22 31 Dec 21 Non-current portion Current portion Total Non-current portion Current portion Total Aliplast Spa 17.4 \u2010 17.4 17.4 \u2010 17.4 Macero Maceratese Srl \u2010 1.1 1.1 \u2010 \u2010 \u2010 Eco Gas Srl \u2010 \u2010 \u2010 \u2010 0.4 0.4 Payables to acquire controlling shareholdings 17.4 1.1 18.5 17.4 0.4 17.8 Pistoia Ambiente Srl \u2010 11.5 11.5 5.6 \u2010 5.6 Aliplast Spa \u2010 0.5 0.5 \u2010 0.5 0.5 Recycla Spa \u2010 0.2 0.2 \u2010 1.2 1.2 Other minor companies \u2010 \u2010 \u2010 \u2010 0.1 0.1 Contingent consideration \u2010 12.2 12.2 5.6 1.8 7.4 Total 17.4 13.3 30.7 23.0 2.2 25.2 During the year, the estimate of the contingent consideration for the acquisition of control over Pistoia Ambiente Srl (subsequently merged into Herambiente Spa) was updated in the amount of 5.7 million euro, recorded under expenses related to changes in the fair value of financial liabilities. In \u201cOverdrafts and interest liabilities\u201d, the significant change compared with the previous financial period is due to the underwriting of short-term monetary loans in the form of hot money in the last quarter of 2022, totalling 230 million euro (23.3 million at 31 December 2021), in light of the elevated volatility of energy markets. These loans were in the initial months of 2023 and, at the same time, the Group did not take out any further short-term loans given its satisfactory cash position. \u201cOther financial payables\u201d mainly refer to: 31 Dec 22 31 Dec 21 Non-current portion Current portion Total Non-current portion Current portion Total European Energy Exchange \u2010 145.1 145.1 \u2010 266.6 266.6 Factoring \u2010 61.0 61.0 \u2010 23.1 23.1 Fund for energy and waste management services \u2010 20.4 20.4 \u2010 39.0 39.0 Municipal Pension Fund of the Municipality of Trieste 1.5 0.3 1.8 1.9 0.1 2.0 Other minor items \u2010 4.6 4.6 \u2010 47.8 47.8 Total 1.5 231.4 232.9 1.9 376.6 378.5 \u25aa European Energy Exchange includes down payments related to power exchange contracts concluded on the EEX platform, which provides for daily adjustment of differentials. The change is due to the dynamic increase in energy commodity prices, which has oriented the Group to prioritize the settlement of expiring contract positions while reducing the underwriting of new positions, turning instead to other negotiated forms of exchange contracts; \u25aa Factoring mainly includes collections yet to be transferred to financial institutions at the end of the year, in relation to receivables subject to non-recourse assignments for which the Group has maintained collection activities on behalf of factor companies; \u25aa Fund for energy and waste management services includes revenues to be retroceded as they have already been advanced by CSEA in relation to the reports made by the Group for the activities carried out in the gas and electricity sales markets subject to tenders, as detailed in Note 36 \u201cOther current liabilities\u201d to which please refer for more details; \u25aa Other minor items decreased significantly due to the payment of 39.4 million euro to the companies that own the assets, following the conclusion of the tender process at the end of 2021 and consequent awarding of the management of the water service in the province of Rimini area, where the Group, although confirmed as provider, was formally obliged as the outgoing operator to pay compensation for the previous award period. The following table shows financial liabilities broken down by nature at 31 December 2022, showing bands of maturity: Type Residual amount 31 Dec 22 Portion due within the period Portion due within 2nd year Portion due within 5th year Portion due beyond 5th year Bonds 3,221.4 21.8 424.4 714.8 2,060.4 Loans 2,037.2 65.3 655.1 1,227.5 89.3 Minority shareholders\u2019 put option 501.2 1.7 16.6 476.7 6.2 Payables to acquire controlling shareholdings and potential consideration 30.7 13.3 \u2010 17.4 \u2010 Other financial liabilities 232.9 231.4 0.3 1.2 \u2010 Overdrafts and interest liabilities 316.6 316.6 \u2010 \u2010 \u2010 Total 6,340.0 650.1 1,096.4 2,437.6 2,155.9 The table below shows the worst-case scenario where assets (cash, financial and trade receivables) are not taken into account, while financial liabilities are shown in the capital and interest portion, trade payables and interest rate derivatives. Financial lines were assumed to be revoked on demand, while loans were assumed to be repaid at the earliest date provided for in the contractual terms. Worst case scenario 31 Dec 22 31 Dec 21 (mn\u20ac) from 1 to 3 months more than 3 months to 1 year from 1 to 2 years from 1 to 3 months more than 3 months to 1 year from 1 to 2 years Bonds 33.0 99.0 511.0 33.0 62.0 87.0 Financial payables and other liabilities 329.6 732.0 91.0 66.8 66.0 62.0 Payables to suppliers 3,093.1 \u2010 \u2010 2,356.6 \u2010 \u2010 Total 3,455.8 831.0 602.0 2,456.4 128.0 149.0 Current cash and lines of credit, in addition to the resources generated by the operating and financing activities, are deemed sufficient to meet future financial needs. The following is a summary of the credit lines available at 31 December 2022, compared with the previous year: 31 Dec 22 31 Dec 21 Committed credit lines 1,230.0 450.0 Uncommitted credit lines 517.0 516.0 Total 1,747.0 966.0 The credit lines are distributed among the leading Italian and international banks and allow for adequate diversification of counterparty risk and competitive conditions. The significant increase in committed lines relates to the signing in December 2022 of a commitment letter committing a pool of banks to provide the Hera Group with a 750 million euro loan backed by a SACE guarantee. Scenario analyses
Debt
analysis by
maturity
Sureties and guarantees 31 Dec 22 31 Dec 21 Bank sureties and guarantees 2,780.0 1,870.2 Insurance sureties and guarantees 851.5 676.0 Total 3,631.5 2,546.2 For \u201cBank sureties and guarantees\u201d, the value at 31 December 2022, compared with the previous period, comprises the following: 31 Dec 22 31 Dec 21 Bank sureties 1,244.4 913.6 Letters of patronage 1,535.6 956.6 Total 2,780.0 1,870.2 Specifically: \u25aa bank sureties are related to sureties made to public institutions (the Ministry of the Environment and Energy Security, the regions, provinces and municipalities) and private entities to guarantee the suitable management of plants for treating and disposing of waste, for the suitable provision of waste disposal and intermediation services, for reclamation work and for the proper fulfilment of contractual commitments on wholesale energy commodity markets; \u25aa Letters of patronage are issued mainly to guarantee the timely payment of raw material supplies. The increase from the previous year is due to higher guarantees provided for operations in the wholesale gas and electricity commodity procurement markets, mainly due to the increase in prices of benchmark commodities. \u201cInsurance sureties and guarantees\u201d at 31 December 2022 refers to sureties issued to public entities (provinces, municipalities and the Ministry of the Environment and Energy Security) and third parties to guarantee the suitable management of public utility and waste disposal services, the proper execution of the work to lay company pipelines across land owned by private individuals, reclamation work, managing waste treatment and disposal systems. Finally, it should be noted that, at 31 December 2022, the Hera Group provided the guarantees for certain bank loans, in the amount of 11.8 million euro. In particular, these refer to mortgages on buildings belonging to the company Recycla Spa located in Maniago (PN), Resana (TV) and San Quirino (PN) and on buildings belonging to the company Marche Multiservizi Spa located in Pesaro and Urbino, lent to banking institutions that have provided loans to the Group, the residual nominal amount of which at 31 December 2022 totals 4.4 million euro. ", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialLiabilitiesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-467": { "value": "
\u201dBonds and loans\u201d for the non-current part, changed mainly due to the overall net effect of the following:
\u25aa issuance of the third green bond by the Group, which is part of the sustainability strategy aimed at
financing or refinancing various projects, already carried out or planned in the business plan, selected
on the basis of the provisions of the Green financing framework. the new bond, which is listed on the
regulated markets of the Irish, Luxembourg and Italian stock exchanges, has a nominal value of 500
million euro, a duration of 7 years and an annual coupon of 2.5%. For further details regarding the
new issuance, reference should be made to chapter 1.03 \u201cMain significant events\u201d in the Directors\u2019
report;
\u25aa use of a medium/long-term credit line, as a term loan bullet granted in pool by the main banks working
with the Group, amounting to 450 million euro. This financing is backed by a guarantee issued by
Sace Spa (based on Article 15 of Legislative Decree No. 50 of 17 May 2022, subsequently converted
into law) and is regulated by a variable interest rate;
\u25aa subscription during the year of various loans with leading banks totalling 1,175 million euro, at both
fixed and floating rates, with bullet repayment and an average term of approximately two years;
\u25aa classification in the current portion of a bond loan with a remaining face value of 22 million euro,
maturing in May 2023.
The item also includes the value of the put option, in the amount of 54.8 million euro, related to Ascopiave
Spa\u2019s 3% minority shareholding in Hera Comm Spa which, as a result of the contractual provisions, is
classified as a loan and valued according to the depreciated cost method. This debt, with a nominal value
of 54 million euro, increased due to the financial evaluation component and decreased due to dividends
paid out:
Opening value
Financial expenses
Flows paid out
Terminal value
2021 financial year
54.5
3.2
(2.7)
55.0
2022 financial year
55.0
3.2
(3.4)
54.8
The current portion of \u201cBonds and loans\u201d includes the portions of medium- and long-term debts due within the next fiscal year, as well as the bond coming due in May. The main conditions of the bonds outstanding at 31 December 2022 are as follows: Bonds Duration (years) Maturity Nominal value (mn/\u20ac) Coupon Rate Sustainability linked bond 12.5 25 Apr 2034 500 Eur Annual 1.00% Bond 10 22 May 2023 22 Eur Annual 3.375% Green bond 10 04 Jul 2024 288.3 Eur Annual 2.375% Bond* 15 05 Aug 2024 20,000 JPY Six monthly 2.93% Bond 12 22 May 2025 15 Eur Annual 3.5% Green bond 7 25-mag-2029 500 Eur Annual 2.5% Bond 10 14 Oct 2026 325.44 Eur Annual 0.875% Bond 10 03 Dec 2030 500 Eur Annual 0.25% Bond* 15/20 14 May 2027/2032 102.5 Eur Annual 5.25% Green bond 8 05 Jul 2027 357.2 Eur Annual 0.875% Bond 15 29 Jan 2028 599.02 Eur Annual 5.20% * Unlisted instrument At 31 December 2022, the outstanding bonds, totalling a face value of 3,359.2 million euro (2,859.2 at 31 December 2021) and recorded at discounted cost of 3,221.4 million euro, have a fair value of 2,986.8 million euro (3,100.7 at 31 December 2021) determined by market quotations where available. There are covenants on some loans that require compliance with the corporate rating limit, which must be rated, even only by a single rating agency, no lower than investment grade (BBB-). As of the balance sheet date this covenant has been complied with. Bonds ", "dimensions": { "concept": "ifrs-full:DisclosureOfBorrowingsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-53": { "value": "\u201dBonds and loans\u201d for the non-current part, changed mainly due to the overall net effect of the following: \u25aa issuance of the third green bond by the Group, which is part of the sustainability strategy aimed at financing or refinancing various projects, already carried out or planned in the business plan, selected on the basis of the provisions of the Green financing framework. the new bond, which is listed on the regulated markets of the Irish, Luxembourg and Italian stock exchanges, has a nominal value of 500 million euro, a duration of 7 years and an annual coupon of 2.5%. For further details regarding the new issuance, reference should be made to chapter 1.03 \u201cMain significant events\u201d in the Directors\u2019 report; \u25aa use of a medium/long-term credit line, as a term loan bullet granted in pool by the main banks working with the Group, amounting to 450 million euro. This financing is backed by a guarantee issued by Sace Spa (based on Article 15 of Legislative Decree No. 50 of 17 May 2022, subsequently converted into law) and is regulated by a variable interest rate; \u25aa subscription during the year of various loans with leading banks totalling 1,175 million euro, at both fixed and floating rates, with bullet repayment and an average term of approximately two years; \u25aa classification in the current portion of a bond loan with a remaining face value of 22 million euro, maturing in May 2023. The item also includes the value of the put option, in the amount of 54.8 million euro, related to Ascopiave Spa\u2019s 3% minority shareholding in Hera Comm Spa which, as a result of the contractual provisions, is classified as a loan and valued according to the depreciated cost method. This debt, with a nominal value of 54 million euro, increased due to the financial evaluation component and decreased due to dividends paid out: Opening value Financial expenses Flows paid out Terminal value 2021 financial year 54.5 3.2 (2.7) 55.0 2022 financial year 55.0 3.2 (3.4) 54.8 The current portion of \u201cBonds and loans\u201d includes the portions of medium- and long-term debts due within the next fiscal year, as well as the bond coming due in May. The main conditions of the bonds outstanding at 31 December 2022 are as follows: Bonds Duration (years) Maturity Nominal value (mn/\u20ac) Coupon Rate Sustainability linked bond 12.5 25 Apr 2034 500 Eur Annual 1.00% Bond 10 22 May 2023 22 Eur Annual 3.375% Green bond 10 04 Jul 2024 288.3 Eur Annual 2.375% Bond* 15 05 Aug 2024 20,000 JPY Six monthly 2.93% Bond 12 22 May 2025 15 Eur Annual 3.5% Green bond 7 25-mag-2029 500 Eur Annual 2.5% Bond 10 14 Oct 2026 325.44 Eur Annual 0.875% Bond 10 03 Dec 2030 500 Eur Annual 0.25% Bond* 15/20 14 May 2027/2032 102.5 Eur Annual 5.25% Green bond 8 05 Jul 2027 357.2 Eur Annual 0.875% Bond 15 29 Jan 2028 599.02 Eur Annual 5.20% * Unlisted instrument At 31 December 2022, the outstanding bonds, totalling a face value of 3,359.2 million euro (2,859.2 at 31 December 2021) and recorded at discounted cost of 3,221.4 million euro, have a fair value of 2,986.8 million euro (3,100.7 at 31 December 2021) determined by market quotations where available. There are covenants on some loans that require compliance with the corporate rating limit, which must be rated, even only by a single rating agency, no lower than investment grade (BBB-). As of the balance sheet date this covenant has been complied with. Bonds ", "dimensions": { "concept": "ifrs-full:DisclosureOfDebtSecuritiesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-54": { "value": "Sureties and guarantees 31 Dec 22 31 Dec 21 Bank sureties and guarantees 2,780.0 1,870.2 Insurance sureties and guarantees 851.5 676.0 Total 3,631.5 2,546.2 For \u201cBank sureties and guarantees\u201d, the value at 31 December 2022, compared with the previous period, comprises the following: 31 Dec 22 31 Dec 21 Bank sureties 1,244.4 913.6 Letters of patronage 1,535.6 956.6 Total 2,780.0 1,870.2 Specifically: \u25aa bank sureties are related to sureties made to public institutions (the Ministry of the Environment and Energy Security, the regions, provinces and municipalities) and private entities to guarantee the suitable management of plants for treating and disposing of waste, for the suitable provision of waste disposal and intermediation services, for reclamation work and for the proper fulfilment of contractual commitments on wholesale energy commodity markets; \u25aa Letters of patronage are issued mainly to guarantee the timely payment of raw material supplies. The increase from the previous year is due to higher guarantees provided for operations in the wholesale gas and electricity commodity procurement markets, mainly due to the increase in prices of benchmark commodities. \u201cInsurance sureties and guarantees\u201d at 31 December 2022 refers to sureties issued to public entities (provinces, municipalities and the Ministry of the Environment and Energy Security) and third parties to guarantee the suitable management of public utility and waste disposal services, the proper execution of the work to lay company pipelines across land owned by private individuals, reclamation work, managing waste treatment and disposal systems. Finally, it should be noted that, at 31 December 2022, the Hera Group provided the guarantees for certain bank loans, in the amount of 11.8 million euro. In particular, these refer to mortgages on buildings belonging to the company Recycla Spa located in Maniago (PN), Resana (TV) and San Quirino (PN) and on buildings belonging to the company Marche Multiservizi Spa located in Pesaro and Urbino, lent to banking institutions that have provided loans to the Group, the residual nominal amount of which at 31 December 2022 totals 4.4 million euro.", "dimensions": { "concept": "ifrs-full:DisclosureOfCommitmentsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-439": { "value": "20 Cash flows related to financing activities Changes in financial liabilities The following is a breakdown of information on changes in financial liabilities during the 2022 financial year, differentiating between cash flows and non-cash flows. Non-cash flows Type 31 Dec 22 31-Dec-21 Change (a) Acquisitions divestitures (b) Economic valuation components (c) Changes in fair value (d) Other changes (e) Cash flows (f)=(a)- [(b)+(c)+(d)+( e)] Non-current financial liabilities 5,689.9 3,716.0 1,973.9 10.6 50.4 (6.3) (128.6) 2,047.8 Current financial liabilities 650.1 499.7 150.4 7.3 0.3 110.9 31.9 Cash flows related to financial liabilities 6,340.0 4,215.7 2,124.3 17.9 50.7 (6.3) (17.7) 2,079.7 of which New issue of long-term bonds 2,127.0 Repayments of non-current financial liabilities \u2010 Repayments and other net changes in financial liabilities (47.3) Lease liabilities 76.4 96.6 (20.2) 1.9 \u2010 \u2010 21.3 (43.4) Financial liabilities generated by financing activities 6,416.4 4,312.3 2,104.1 19.8 50.7 (6.3) 3.6 2,036.3 \u201cAcquisitions and Divestitures\u201d include the effects arising from the control acquisition transactions carried out in the 2022 financial year, as explained in the section \u201cBusiness combination (supplementary information)\u201d in Section 2.02.10 \u201cOther information\u201d. \u201cEconomic valuation components\u201d include: \u25aa charges from the amortised cost valuation of bonds and loans in the amount of 30 million euro, as reported in Note 11 \u201cFinancial expenses\u201d; \u25aa discounting charges related to the put options of non-controlling shareholdings and earn-outs contracted as part of the acquisition of control over companies and business units, amounting to 20.7 million euros, as reported in Note 11 \u201cFinancial expenses\u201d, \u201cChanges in fair value\u201d include mainly: \u25aa the adjustment to fair value of the carrying amount of the put option recorded against the minority shareholder of EstEnergy Spa, which resulted in the recognition of income in the amount of 12.6 million euro, as reported in Note 19 \u201cFinancial liabilities\u201d; \u25aa the adjustment to fair value of the carrying amount of the earn-out recorded at the time of the acquisition of Pistoia Ambiente Srl, which resulted in the recognition of charges amounting to 5.7 million euro, as reported in Note 19 \u201cFinancial liabilities\u201d; \u25aa the adjustment made to the carrying value of a foreign currency bond due to the fair value hedge relationship that resulted in the recognition of charges amounting to 0.6 million euro, as reported in Note 29 \u201cDerivative Instruments\u201d. \u201cOther changes\u201d include effects mainly due to: \u25aa payment of dividends to minority shareholders with whom the Group contracted put options at the time of acquiring control, amounting to 21.9 million euro. In the cash flow statement, the related cash flow is represented in dividends paid out, although it is accounted for as a change in the financial liability already recorded (this mechanism is explained in Note 19 \u201cFinancial liabilities\u201d); \u25aa the recognition, in application of amortised cost, of the adjustment of the nominal value of the bond loan and loans taken out during the year totalling 10.2 million euro; \u25aa the recognition of liabilities related to leases entered into during the year and the remeasurement of outstanding lease liabilities generated by an update of the underlying assumptions about renewal, purchase, or early termination options, as reported in Note 22, \u201cRights of Use and Lease Liabilities\u201d. Acquisition of Interests in consolidated companies The value refers mainly to the outlay related to the purchase of non-controlling shares in Hera Comm Marche Srl, as described in section 2.02.01 \u201cIntroduction\u201d. Dividends paid out to Hera shareholders and non-controlling interests The value refers to dividends paid out during the year 2022 to: \u25aa Parent Company\u2019s shareholders in the amount of 176.7 million euro; \u25aa minority shareholders in the amount of 42.8 million euro, of which 21.9 million euro were paid to minority shareholders to whom the Group had recognized payables for put options in previous years, as mentioned above. Finally, it should be noted that non-monetary flows due to exchange rate differences were absent in 2022. 28 Cash flows related to investment activities Investments in subsidiary companies and business units net of cash holdings For more details on the acquisition transactions carried out during the 2022 financial year, please refer to Section 1.03 \u201cSignificant Events\u201d of the Directors\u2019 Report under section \u201cBusiness Combinations (supplementary information)\u201d and Section 2.02.10 \u201cOther Information\u201d of the Notes to the Financial Statements. Other equity investments During the 2022 fiscal year, the Group acquired non-controlling shares of Aurora Srl, which operates in the waste treatment sector. This company, not equipped with significant assets, is not yet operational and has thus been excluded from the scope of consolidation and recorded under investments in other shareholdings. The table below details the main cash disbursements and cash holdings acquired, when present, associated with shareholdings in companies and business units. 31 Dec 22 Alibardi Fiorenzo Srl Con Energia Spa Macero Maceratese Srl \u201cBfeng\u201d business unit Other minor companies Total investments Cash outlays leading to the acquisition of control 1.4 30.0 10.0 12.0 53.4 Considerations to pay out 1.1 1.1 Cash holdings acquired (4.2) (0.2) (4.4) Investments in subsidiary companies and business units net of cash holdings 1.4 25.8 10.9 12.0 50.1 Cash outlays in non-consolidated companies 3.2 3.2 Investments in subsidiary companies, business units and other shareholdings 1.4 25.8 10.9 12.0 3.2 53.3 Increase/decrease in other investment activities The following is a breakdown of information on changes in the other investment activities during the 2022 financial year, differentiating between cash flows and non-cash flows. Type Non-cash flows 31 Dec 22 31 Dec 21 Change (a) Acquisitions divestitures (b) Economic valuation components (c) Changes in fair value (d) Other changes (e) Cash flows (f)=[(b)+(c)+( d)+(e)]-(a) Current and non- current financial assets 229.5 172.0 57.5 2.3 6.8 49.5 1.1 \u201cAcquisitions and Divestitures\u201d include the effects arising from the control acquisition transactions carried out in the 2022 financial year, as explained in the section \u201cBusiness Combinations (supplementary information)\u201d of section 2.02.10 \u201cOther information\u201d. \u201cEconomic valuation components\u201d mainly include income from discounting non-current financial receivables (amounting to 4.7 million at 31 December 2022), as reported in Note 10 \u201cFinancial income\u201d. \u201cOther changes\u201d mainly includes the amount of tax credit assignments realized at the end of the 2022 fiscal year with leading financial institutions, the collection of which took place in January 2023 in the amount of 46.3 million. For further details, please see note 18 \u201cFinancial assets, cash holdings and cash equivalents\u201d. 37 Cash flows of operating activities Changes in net working capital The following is a breakdown of information on changes in financial liabilities during the 2022 financial year, differentiating between cash flows and non-cash flows. Type 31 Dec 22 31 Dec 21 Change (a) Non-cash flows Cash flows (f)=[(b)+(c)+( d)+(e)]-(a) Acquisitions divestitures (b) Economic valuation components (c) Changes in fair value (d) Other changes (e) Inventories 995.1 368.0 627.1 0.1 0.2 (0.6) (627.4) Commercial receivables 3,875.0 2,918.0 957.0 13.6 (133.5) 11.0 (214.8) (1,280.7) Commercial payables (3,093.1) (2,356.6) (736.5) (8.8) 0.1 727.8 Other current assets/liabilities (1,077.5) (1,013.3) (64.2) (2.0) 13.7 (4.8) 181.6 252.7 Changes in working capital 699.5 (83.9) 783.4 2.9 (119.6) 6.2 (33.7) (927.6) \u201cAcquisitions and divestitures\u201d includes the effects of the acquisitions of control carried out during 2022, as illustrated in detail in the section \u201cBusiness Combinations (supplementary information)\u201d of paragraph 2.02.10 \u201cOther information\u201d. \u201cEconomic valuation components\u201d mainly includes: \u25aa the provision for bad debts for a negative 133.9 million euro, as illustrated in Note 33 \u201cCommercial receivables\u201d; \u25aa the portions pertaining to the period of plan related grants, the total amount of which was collected in previous years, totalling a positive amount of 12.8 million euro, as stated in Note 2 \u201cOther operating revenues\u201d. \u201cChanges in fair value\u201d includes: \u25aa the valuation at current market value of receivables resulting from the application of the invoice discount in connection with energy efficiency measures for end customers, held for to be transferred to financial institutions, for a positive 11 million euro; For further details on the Group\u2019s accounting policy, please see Note 11 \u201cFinancial expenses\u201d \u25aa the valuation of environmental certificates and greenhouse gas emission obligations assigned to the Group, as well as the valuation of forward contracts for the purchase and sale of greenhouse gas emission allowances, for a total negative 4.8 million euro, as illustrated in Note 35 \u201cOther current assets\u201d and 36 \u201cOther current liabilities\u201d. \u201cOther changes\u201d mainly comprises offsets within net working capital of transactions involving the gross recognition of assets and liabilities. It should also be noted, as already indicated in Note 20 \u201cCash Flows from financing activities\u201d, the reclassification of non-monetary flows related to the transfer of tax credits arising from the application of the invoice discount for energy efficiency measures, in the amount of 46.3 million euro. Dividends collected In 2022, dividends for 9.4 million euro were received from companies consolidated according to the equity method and 4 million euro from shareholdings held in other companies. For further details, please see note 10 \u201cFinancial income\u201d and 26 \u201cShareholdings\u201d. Net interest paid The following is a reconciliation of the balance sheet values of financial income and expenses and the related net cash flows for the year.
Type
2022
(a)
Non-cash components
Other changes
(d)
Cash components
(e)=(a)-[(b)+(c)+(d)]
Economic valuation
components
(b)
Changes in fair value
(c)
Financial income
82.2
4.7
25.0
10.7
41.8
Financial expenses
(217.2)
(63.0)
(6.9)
(19.3)
(128.0)
Total
(135.0)
(58.3)
18.1
(8.6)
(86.2)
\u201cEconomic valuation components\u201d includes income and expenses arising from both the measurement at
amortised cost and the discounting of receivables and liabilities characterised by monetary outlays to be
carries out in the medium- to long-term period, as illustrated in Note 10 \u201cFinancial income\u201d and Note 11
\u201cFinancial expenses\u201d.
\u201cChanges in fair value\u201d includes measurements at current market value of financial assets and liabilities,
mainly relating to:
\u25aa receivables arising from the application of the invoice discount in relation to energy efficiency
measures for end customers for a positive 11.2 million euro. For further details on the Group\u2019s
accounting policy, please see Note 11 \u201cFinancial expenses\u201d;
\u25aa fair value valuation of put options and contingent consideration for a total net effect of a positive 7
million euro.
\u201cOther change\u201d mainly includes:
\u25aa interest cash flows recognised on an accrual basis and not yet paid at 31 December 2022;
\u25aa the components of income collected and expenses paid during the year, with the associated cash
flows reported in specific items of the cash flow statement, mainly related to dividends dividends paid
by other minor holdings.
Taxes paid
The breakdown of flows by tax type is as follows:
31 Dec 22
31 Dec 21
Income taxes
131.9
148.2
Extraordinary contributions
24.9
\u2010
Substitute tax
9.1
9.2
IRES refund
\u2010
(1.1)
Taxes paid
165.9
156.3
Income taxes include the amount paid by the Group during the year 2022 in relation to the 2021 IRES
and IRAP balances and the advance payments due for the year 2022.
Extraordinary contributions represent the amount paid during the 2022 financial year in relation to the
\u201cExtraordinary extra-profit contribution\u201d. For further details see Notes 12 \u201cTaxes\u201d and 35 \u201cOther current
assets\u201d.
The substitute tax includes, at 31 December 2022, the amount paid in relation to the exemption of
controlling interests in connection with the acquisitions of Eco Gas Srl and Vallortigara Servizi Ambientali
Spa. At 31 December 2021, the item included the amount paid in relation to the tax realignment regulation
for goodwill, as outlined in note 12 \u201cTaxes\u201d.
", "dimensions": { "concept": "ifrs-full:DisclosureOfCashFlowStatementExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-55": { "value": "20 Cash flows related to financing activities Changes in financial liabilities The following is a breakdown of information on changes in financial liabilities during the 2022 financial year, differentiating between cash flows and non-cash flows. Non-cash flows Type 31 Dec 22 31-Dec-21 Change (a) Acquisitions divestitures (b) Economic valuation components (c) Changes in fair value (d) Other changes (e) Cash flows (f)=(a)- [(b)+(c)+(d)+( e)] Non-current financial liabilities 5,689.9 3,716.0 1,973.9 10.6 50.4 (6.3) (128.6) 2,047.8 Current financial liabilities 650.1 499.7 150.4 7.3 0.3 110.9 31.9 Cash flows related to financial liabilities 6,340.0 4,215.7 2,124.3 17.9 50.7 (6.3) (17.7) 2,079.7 of which New issue of long-term bonds 2,127.0 Repayments of non-current financial liabilities \u2010 Repayments and other net changes in financial liabilities (47.3) Lease liabilities 76.4 96.6 (20.2) 1.9 \u2010 \u2010 21.3 (43.4) Financial liabilities generated by financing activities 6,416.4 4,312.3 2,104.1 19.8 50.7 (6.3) 3.6 2,036.3 \u201cAcquisitions and Divestitures\u201d include the effects arising from the control acquisition transactions carried out in the 2022 financial year, as explained in the section \u201cBusiness combination (supplementary information)\u201d in Section 2.02.10 \u201cOther information\u201d. \u201cEconomic valuation components\u201d include: \u25aa charges from the amortised cost valuation of bonds and loans in the amount of 30 million euro, as reported in Note 11 \u201cFinancial expenses\u201d; \u25aa discounting charges related to the put options of non-controlling shareholdings and earn-outs contracted as part of the acquisition of control over companies and business units, amounting to 20.7 million euros, as reported in Note 11 \u201cFinancial expenses\u201d, \u201cChanges in fair value\u201d include mainly: \u25aa the adjustment to fair value of the carrying amount of the put option recorded against the minority shareholder of EstEnergy Spa, which resulted in the recognition of income in the amount of 12.6 million euro, as reported in Note 19 \u201cFinancial liabilities\u201d; \u25aa the adjustment to fair value of the carrying amount of the earn-out recorded at the time of the acquisition of Pistoia Ambiente Srl, which resulted in the recognition of charges amounting to 5.7 million euro, as reported in Note 19 \u201cFinancial liabilities\u201d; \u25aa the adjustment made to the carrying value of a foreign currency bond due to the fair value hedge relationship that resulted in the recognition of charges amounting to 0.6 million euro, as reported in Note 29 \u201cDerivative Instruments\u201d. \u201cOther changes\u201d include effects mainly due to: \u25aa payment of dividends to minority shareholders with whom the Group contracted put options at the time of acquiring control, amounting to 21.9 million euro. In the cash flow statement, the related cash flow is represented in dividends paid out, although it is accounted for as a change in the financial liability already recorded (this mechanism is explained in Note 19 \u201cFinancial liabilities\u201d); \u25aa the recognition, in application of amortised cost, of the adjustment of the nominal value of the bond loan and loans taken out during the year totalling 10.2 million euro; \u25aa the recognition of liabilities related to leases entered into during the year and the remeasurement of outstanding lease liabilities generated by an update of the underlying assumptions about renewal, purchase, or early termination options, as reported in Note 22, \u201cRights of Use and Lease Liabilities\u201d.", "dimensions": { "concept": "ifrs-full:DisclosureOfReconciliationOfLiabilitiesArisingFromFinancingActivitiesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-468": { "value": "Dividends paid out to Hera shareholders and non-controlling interests The value refers to dividends paid out during the year 2022 to: \u25aa Parent Company\u2019s shareholders in the amount of 176.7 million euro; \u25aa minority shareholders in the amount of 42.8 million euro, of which 21.9 million euro were paid to minority shareholders to whom the Group had recognized payables for put options in previous years, as mentioned above.", "dimensions": { "concept": "ifrs-full:DisclosureOfDividendsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-446": { "value": "21 Tangible assets 31 Dec 22 31 Dec 21 Change Land and buildings 620.4 585.3 35.1 Plants and machinery 1,089.5 1,107.8 (18.3) Other movable assets 89.5 123.7 (34.2) Assets under construction 183.0 122.1 60.9 Total operating assets 1,982.4 1,938.9 43.5 Investment property 2.0 2.1 (0.1) Total 1,984.4 1,941.0 43.4 Property, plant and equipment are disclosed net of accumulated depreciation. Their composition and changes in the period are as follows: Net opening balance Investments Disinvest- ments Depreciation and amortisation Changes in the scope of consol- idation Other changes Net terminal value of which gross terminal value of which amortis- ation provision 31 Dec 21 Land and buildings 573.2 13.2 (0.1) (21.5) 9.6 10.9 585.3 856.8 (271.5) Plants and machinery 1,120.1 58.0 (4.2) (120.6) 3.3 51.2 1,107.8 3,005.5 (1,897.7) Other movable assets 126.5 14.4 (0.8) (28.8) 2.3 10.1 123.7 511.1 (387.4)
Assets under
construction
104.4
86.3
(0.1)
(2.0)
\u2010
(66.5)
122.1
122.1
\u2010
Total
1,924.2
171.9
(5.2)
(172.9)
15.2
5.7
1,938.9
4,495.5
(2,556.6)
31 Dec 22
Land and buildings
585.3
24.0
(1.9)
(19.5)
3.7
28.8
620.4
908.7
(288.3)
Plants and machinery
1,107.8
61.8
(3.7)
(112.5)
9.0
27.1
1,089.5
3,060.2
(1,970.7)
Other movable assets
123.7
13.7
(0.3)
(21.0)
0.6
(27.2)
89.5
433.1
(343.6)
Assets under
construction
122.1
126.1
(0.5)
\u2010
\u2010
(64.7)
183.0
183.0
\u2010
Total
1,938.9
225.6
(6.4)
(153.0)
13.3
(36.0)
1,982.4
4,585.0
(2,602.6)
For a better understanding of the changes that took place in the period, it should be noted that the assets
used to carry out the urban sanitation service in the territorial basins of Bologna and the \u201cpianura e
montagna modenese\u201d, totalling 53.1 million euro, have been reclassified under \u201cPublic services under
concession\u201d among intangible assets, following the awarding of the tender for the period 2022-2036 in
favour of the Temporary Grouping of companies (RTI) led by the Hera Group. Specifically, land and
buildings amounting to 2.9 million euro, plants and machinery amounting to 15 million euro, other
movable assets amounting to 22.7 million euro, and motor vehicles amounting to 12.5 million euro were
reclassified under intangible assets.
\u201cLand and buildings\u201d consists of 129.2 million euro in land and 491.2 million euro in buildings. These are
mainly company-owned properties on which the majority of the sites and production plants stand.
\u201cPlant and machinery\u201d is made up mainly of distribution networks and plants relating to business not
falling within the scope of the concession system such as district heating, electricity in the Modena area,
waste disposal and waste treatment as well as plastic production plants. The main investments for the
year were in waste treatment activities amounting to 31.2 million euro and electricity distribution
amounting to 10.7 million euro. At the same time, disinvestments took place for demolition as well as
divestments of obsolete plants, which contributed to the reduction in depreciation compared with the
previous year.
\u201cOther movable assets\u201d, mainly includes the equipment, waste disposal bins in the amount of 56.5 million
euro, and vehicles totalling 33 million euro.
\u201cAssets under construction\u201d include mainly the investments being made in waste treatment plants
amounting to 69.1 million euro and the electricity distribution network amounting to 12.5 million euro, as
well as expansions and extraordinary maintenance of the Group\u2019s operating offices amounting to 17.1
million euro.
\u201cOther changes\u201d covers the in-progress reclassification of fixed assets to the specific categories for
assets brought into operation during the financial year, as well as the reclassification from tangible assets
to intangible assets, especially when goods used in activities under concession are involved.
During 2022 financial year, in addition to the above in relation to urban sanitation, there was also the
redemption of assets previously held by the Group through leasing contracts and classified under Rights
of Use, totalling 21.8 million euro, of which the largest part relates to the item \u201cLand and buildings\u201d.
For the column \u201cChange in the scope of consolidation,\u201d please refer to the section \u201cBusiness combination
(supplementary information)\u201d contained in Section 2.02.10 \u201cOther information.\u201d
For additional details on guarantees granted in favour of third parties and in relation to tangible assets
held by the Group, please refer to note 19 \u201cFinancial liabilities\u201d.
", "dimensions": { "concept": "ifrs-full:DisclosureOfInvestmentPropertyExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-417": { "value": "21 Tangible assets 31 Dec 22 31 Dec 21 Change Land and buildings 620.4 585.3 35.1 Plants and machinery 1,089.5 1,107.8 (18.3) Other movable assets 89.5 123.7 (34.2) Assets under construction 183.0 122.1 60.9 Total operating assets 1,982.4 1,938.9 43.5 Investment property 2.0 2.1 (0.1) Total 1,984.4 1,941.0 43.4 Property, plant and equipment are disclosed net of accumulated depreciation. Their composition and changes in the period are as follows: Net opening balance Investments Disinvest- ments Depreciation and amortisation Changes in the scope of consol- idation Other changes Net terminal value of which gross terminal value of which amortis- ation provision 31 Dec 21 Land and buildings 573.2 13.2 (0.1) (21.5) 9.6 10.9 585.3 856.8 (271.5) Plants and machinery 1,120.1 58.0 (4.2) (120.6) 3.3 51.2 1,107.8 3,005.5 (1,897.7) Other movable assets 126.5 14.4 (0.8) (28.8) 2.3 10.1 123.7 511.1 (387.4) Assets under construction 104.4 86.3 (0.1) (2.0) \u2010 (66.5) 122.1 122.1 \u2010 Total 1,924.2 171.9 (5.2) (172.9) 15.2 5.7 1,938.9 4,495.5 (2,556.6) 31 Dec 22 Land and buildings 585.3 24.0 (1.9) (19.5) 3.7 28.8 620.4 908.7 (288.3) Plants and machinery 1,107.8 61.8 (3.7) (112.5) 9.0 27.1 1,089.5 3,060.2 (1,970.7) Other movable assets 123.7 13.7 (0.3) (21.0) 0.6 (27.2) 89.5 433.1 (343.6) Assets under construction 122.1 126.1 (0.5) \u2010 \u2010 (64.7) 183.0 183.0 \u2010 Total 1,938.9 225.6 (6.4) (153.0) 13.3 (36.0) 1,982.4 4,585.0 (2,602.6) For a better understanding of the changes that took place in the period, it should be noted that the assets used to carry out the urban sanitation service in the territorial basins of Bologna and the \u201cpianura e montagna modenese\u201d, totalling 53.1 million euro, have been reclassified under \u201cPublic services under concession\u201d among intangible assets, following the awarding of the tender for the period 2022-2036 in favour of the Temporary Grouping of companies (RTI) led by the Hera Group. Specifically, land and buildings amounting to 2.9 million euro, plants and machinery amounting to 15 million euro, other movable assets amounting to 22.7 million euro, and motor vehicles amounting to 12.5 million euro were reclassified under intangible assets. \u201cLand and buildings\u201d consists of 129.2 million euro in land and 491.2 million euro in buildings. These are mainly company-owned properties on which the majority of the sites and production plants stand. \u201cPlant and machinery\u201d is made up mainly of distribution networks and plants relating to business not falling within the scope of the concession system such as district heating, electricity in the Modena area, waste disposal and waste treatment as well as plastic production plants. The main investments for the year were in waste treatment activities amounting to 31.2 million euro and electricity distribution amounting to 10.7 million euro. At the same time, disinvestments took place for demolition as well as divestments of obsolete plants, which contributed to the reduction in depreciation compared with the previous year. \u201cOther movable assets\u201d, mainly includes the equipment, waste disposal bins in the amount of 56.5 million euro, and vehicles totalling 33 million euro. \u201cAssets under construction\u201d include mainly the investments being made in waste treatment plants amounting to 69.1 million euro and the electricity distribution network amounting to 12.5 million euro, as well as expansions and extraordinary maintenance of the Group\u2019s operating offices amounting to 17.1 million euro. \u201cOther changes\u201d covers the in-progress reclassification of fixed assets to the specific categories for assets brought into operation during the financial year, as well as the reclassification from tangible assets to intangible assets, especially when goods used in activities under concession are involved. During 2022 financial year, in addition to the above in relation to urban sanitation, there was also the redemption of assets previously held by the Group through leasing contracts and classified under Rights of Use, totalling 21.8 million euro, of which the largest part relates to the item \u201cLand and buildings\u201d. For the column \u201cChange in the scope of consolidation,\u201d please refer to the section \u201cBusiness combination (supplementary information)\u201d contained in Section 2.02.10 \u201cOther information.\u201d For additional details on guarantees granted in favour of third parties and in relation to tangible assets held by the Group, please refer to note 19 \u201cFinancial liabilities\u201d.", "dimensions": { "concept": "ifrs-full:DisclosureOfPropertyPlantAndEquipmentExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-56": { "value": "22 Rights of use and lease liabilities The following tables show the breakdown of rights of use (reported net of the associated amortisation provision) and lease liabilities at the transition date and the related movements. Contracts taken over as part of business combinations are separately reported in movements and classified as \u201cChanges in the scope of consolidation\u201d. 31 Dec 22 31 Dec 21 Change Rights of use land and buildings 50.7 65.7 (15.0) Rights of use plants and machinery 7.1 7.8 (0.7) Rights of use other assets 26.4 28.1 (1.7) Total 84.2 101.6 (17.4) Net opening balance New contracts and contractual changes Deprec- iation and amortis- ation Changes in the scope of consolid- ation Other changes Net terminal value of which gross terminal value of which amortisat- ion provision 31 Dec 21 Rights of use land and buildings 68.7 5.1 (7.7) 0.8 (1.2) 65.7 110.4 (44.7) Rights of use plants and machinery 7.9 0.2 (1.2) 0.9 \u2010 7.8 12.0 (4.2) Rights of use other assets 19.3 14.6 (8.1) 2.4 (0.1) 28.1 48.3 (20.2) Total 95.9 19.9 (17.0) 4.1 (1.3) 101.6 170.7 (69.1) 31 Dec 22 Rights of use land and buildings 65.7 12.5 (7.6) 0.4 (20.3) 50.7 94.1 (43.4) Rights of use plants and machinery 7.8 0.6 (1.2) 0.8 (0.9) 7.1 12.4 (5.3) Rights of use other assets 28.1 8.2 (10.1) 0.8 (0.6) 26.4 49.4 (23.0) Total 101.6 21.3 (18.9) 2.0 (21.8) 84.2 155.9 (71.7) \u201cRights of use land and buildings\u201d consists of 44.9 million euro in rights of use related to buildings and 5.8 million euro in rights of use related to land. The rights of use for buildings refers mainly to contracts concerning the real estate structures used for headquarters, offices and customer service desk. \u201cRights of use of plant and machinery\u201d refers mainly to contracts regarding purification and composting plants. \u201cRights of use of other movable assets\u201d refers mainly to contracts underwritten for the use of IT infrastructures (especially data centres), operational vehicles and cars. The column \u201cNew contracts and contractual amendments\u201d shows the leases signed during the year, as well as the change in the assumptions regarding the duration, renewal or termination options of the existing contracts. The column \u201cOther changes\u201d includes the residual value of leased assets redeemed during the period and reclassified under tangible assets due to their nature. Specifically, it should be noted that, as provided for in the contractual agreements between the parties, in the year 2022 the repossession of buildings where some of the Group\u2019s main production facilities are located took place, buildings which represented, at 31 December 2021, the contracts with the largest absolute value. The total amount reclassified for the above transaction was 19.4 million euro. Financial liabilities show the following composition and change, compared with the previous year: Net opening balance New contracts and contractual changes Decreases Financial expenses Changes in the scope of consolidation Net terminal value 31 Dec 21 Lease liabilities 93.6 19.9 (22.5) 3.2 2.5 96.6 of which non-current liabilities 73.5 53.2 current liabilities 20.1 43.4 31 Dec 22 Lease liabilities 96.6 21.2 (46.0) 2.7 1.9 76.4 of which non-current liabilities 53.2 55.1 current liabilities 43.4 21.3 Financial liabilities due to leases mainly include financial payables arising from the rental fees of the Group\u2019s operating and administrative offices. The column \u201cNew contracts and contractual changes\u201d includes the new contracts signed in the period and the re-assessment of the debt of some of the existing contracts, generated by the update of the assumptions underlying the contracts themselves concerning options of renewal, purchase or early termination. \u201cDecreases\u201d are generated by the reimbursement of contractual fees scheduled during the course of the financial period and redemption options exercised. The value for the period includes, in particular, the previously described repossession of buildings where major production facilities of the Group are located, totalling 22.7 million euro. In accordance with its procurement policies, the Group subscribed contracts in line with market standards for all types of underlying assets. In the case of offices, customer service desks, cars and IT infrastructure, the contracts do not contain any binding clauses or special fees in the event of annulment, as these assets are perfectly interchangeable and are offered by a large number of counterparties. The liability reported in the financial statements therefore represents the most likely total sum of disbursements that the Group will have to make in future periods. For the same reasons, moreover, the renewal clauses, when they exist, are not currently expected to be exercised, possibly assessing their cost-effectiveness in the future or the option of signing new contracts with different counterparties. The table below shows the lease liabilities broken down by category according to their expiration date range: Type Total Portion due within the period Portion due within 2nd year Portion due within 5th year Portion due beyond 5th year 2021 financial year 96.6 43.4 15.0 26.1 12.1 2022 financial year 76.4 21.3 17.4 25.1 12.6", "dimensions": { "concept": "ifrs-full:DisclosureOfLeasesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-488": { "value": "23 Intangible assets 31 Dec 22 31 Dec 21 Change IT applications 82.5 84.6 (2.1) Concessions and other rights of use 110.8 113.8 (3.0) Public services under concession 3,184.5 2,963.4 221.1 Customer lists 581.1 576.2 4.9 Other intangible assets 92.9 79.4 13.5 Intangible assets under construction, public services under concession 273.9 237.4 36.5 Intangible assets under construction 91.7 71.9 19.8 Total 4,417.4 4,126.7 290.7 Intangible assets are stated net of their accumulated amortisation and are broken down below with details of the changes during the year: Net opening balance Invest- ments Disinvest- ments Depreciat- ion and amortis- ation Changes in the scope of consolid- ation Other changes Net terminal value of which gross terminal value of which amortisat- ion provision 31 Dec 21 IT applications 78.8 5.5 \u2010 (39.7) 0.2 39.8 84.6 524.5 (439.9) Concessions and other rights of use 130.2 0.3 \u2010 (16.8) \u2010 0.1 113.8 471.6 (357.8) Public services under concession 2,860.1 181.1 (4.5) (160.9) 4.7 82.9 2,963.4 5,144.1 (2,180.7) Customer lists 546.3 \u2010 \u2010 (34.8) 64.7 \u2010 576.2 693.9 (117.7) Other intangible assets 67.7 33.3 \u2010 (26.9) 0.2 5.1 79.4 225.8 (146.4) Intangible assets under construction, public services under concession 169.5 144.4 (0.8) \u2010 \u2010 (75.7) 237.4 237.4 \u2010 Intangible assets under construction 71.8 52.2 \u2010 (0.9) \u2010 (51.2) 71.9 71.9 \u2010 Total 3,924.4 416.8 (5.3) (280.0) 69.8 1.0 4,126.7 7,369.2 (3,242.5) 31 Dec 22 IT applications 84.6 4.5 \u2010 (42.9) 0.1 36.2 82.5 565.7 (483.2) Concessions and other rights of use 113.8 0.5 \u2010 (15.8) 12.0 0.3 110.8 483.8 (373.0) Public services under concession 2,963.4 208.3 (4.7) (174.9) \u2010 192.4 3,184.5 5,595.3 (2,410.8) Customer lists 576.2 \u2010 \u2010 (39.4) 44.3 \u2010 581.1 741.8 (160.7) Other intangible assets 79.4 43.4 0.0 (33.5) 0.1 3.5 92.9 269.7 (176.8) Intangible assets under construction, public services under concession 237.4 166.8 (0.4) \u2010 \u2010 (129.9) 273.9 273.9 \u2010 Intangible assets under construction 71.9 60.4 \u2010 (0.3) \u2010 (40.3) 91.7 91.7 \u2010 Total 4,126.7 483.9 (5.1) (306.8) 56.5 62.2 4,417.4 8,021.9 (3,604.5) \u201cIT applications\u201d refers to costs incurred in purchasing licenses and implementing corporate information systems. \u201cConcessions and other rights of use\u201d mainly includes: \u25aa concessions, for 37.8 million euro, primarily involving the rights relating to the activities of gas distribution and integrated water cycle, classified as intangible assets even before the IFRIC 12 interpretation \u201cService concession arrangements\u201d was first applied; \u25aa the authorisation to operate the Serravalle Pistoiese landfill, for 53.4 million euro, an asset recorded as part of the a business combination operation carried out in previous periods and amortised on the basis of the number of tons consigned. \u201cPublic services under concession\u201d includes assets relating to gas distribution, electricity distribution (Imola area), the integrated water cycle and public lighting activities (except for the latter, as specified in note 18 \u201cCurrent financial assets, cash and cash equivalents\u201d) provided through contracts awarded by the respective public bodies. These concession relationships and associated assets involved in carrying out the activities for which the Group holds the use rights, are accounted for by applying the intangible asset model as set forth by IFRIC 12 interpretation. Investments for the year related mainly to the water networks, in the amount of 118.7 million euro, and gas distribution networks, in the amount of 51.5 million euro. It should be noted that, during the year, the item was changed by the reclassification of the assets related to the urban sanitation service in the areas of Bologna and Modena, which were previously classified as tangible assets due to the different regulatory framework, following the awarding of the tender for the area, as reported in detail in Note 21 \u201cTangible assets\u201d. Depreciation and amortization for the period, up sharply from last year, is therefore also affected by the above reclassification. \u201cIntangible assets under construction and public services under concession\u201d includes investments related to these concessions that are still to be completed at the end of the period and mainly refers to the water networks, in the amount of 89.8 million euro, and gas distribution networks, in the amount of 34.3 million euro. \u201cIntangible assets under construction\u201d essentially comprises IT projects that have not yet been completed. \u201cCustomer lists\u201d are recorded as a result of business combination transactions and the consequent valuation of the assets acquired. The amortisation period of these customer lists is correlated to the churn rate identified for each individual transaction. Depreciation and amortisation for the period increased compared with the comparison period due to the recognition of customer lists as a result of the control acquisitions in the second half of the 2021 financial year and during the 2022 financial year. The item \u201cOther intangible assets\u201d refers mainly to the rights of use for networks and infrastructures for the passage and laying down of telecommunication networks and the incremental costs incurred for obtaining new sale contracts. In particular, the commissions recognized as assets for the 2022 fiscal year amounted to 36 million euro (24.8 million euro for 2021), and the significant increase in amortisation for the period is due to them. \u201cOther changes\u201d include reclassifications of fixed assets under construction to their specific categories in the case of assets that came into operation during the year and reclassifications from/to tangible assets, especially in the case of assets subject to concession activities, as mentioned under \u201cPublic services under concession\u201d. \u201cChange in scope of consolidation\u201d reflects the control acquisitions made during the year, for details of which please refer to the section \u201cBusiness combination (supplementary information)\u201d contained in Section 2.02.10 \u201cOther information\u201d. 24 Goodwill 31 Dec 22 31 Dec 21 Change Goodwill 848.1 842.9 5.2 The value of goodwill at 31 December 2022 mainly reflects the following operations: \u25aa Acquisition of control of the \u201cAscopiave business activities,\u201d i.e. the companies EstEnergy Spa, Ascotrade Spa, Ascopiave Energie Spa, Blue Meta Spa, Etra Energia Srl and Amgas Blu Srl, which took place in 2019 for a total of 431.2 million euro; \u25aa integration that in 2002 resulted in the creation of Hera Spa, totalling 81.3 million euro; \u25aa acquisition of control through the merger of Agea Spa, taking place in January 2004, amounting to 41.7 million euro: \u25aa acquisition of control over Gruppo Meta which took place during the 2005 financial year, as a result of the merger of Meta Spa into Hera Spa, totalling 117.7 million euro; \u25aa acquisition of control over Sat Spa through the merger into Hera Spa, taking place during 2008, amounting to 54.9 million euro: \u25aa acquisition of control over the Aliplast Group taking place in 2017, totalling 25 million euro; \u25aa acquisition of control over the Marche Multiservizi Group, amounting to 20.8 million euro. As reported in Section \u201cBusiness Combinations (supplementary information)\u201d of section 2.02.10 of \u201cOther information\u201d, during the 2022 fiscal year business combinations took place resulting in an increase in goodwill. Below is the value of goodwill broken down by operating segment: 31 Dec 22 31 Dec 21 Change Gas 493.5 494.8 (1.3) Waste management 233.5 228.3 5.2 Electricity 73.5 72.2 1.3 Water cycle 42.7 42.7 \u2010 Other services 4.9 4.9 \u2010 Total 848.1 842.9 5.2", "dimensions": { "concept": "ifrs-full:DisclosureOfIntangibleAssetsAndGoodwillExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-57": { "value": "23 Intangible assets 31 Dec 22 31 Dec 21 Change IT applications 82.5 84.6 (2.1) Concessions and other rights of use 110.8 113.8 (3.0) Public services under concession 3,184.5 2,963.4 221.1 Customer lists 581.1 576.2 4.9 Other intangible assets 92.9 79.4 13.5 Intangible assets under construction, public services under concession 273.9 237.4 36.5 Intangible assets under construction 91.7 71.9 19.8 Total 4,417.4 4,126.7 290.7 Intangible assets are stated net of their accumulated amortisation and are broken down below with details of the changes during the year: Net opening balance Invest- ments Disinvest- ments Depreciat- ion and amortis- ation Changes in the scope of consolid- ation Other changes Net terminal value of which gross terminal value of which amortisat- ion provision 31 Dec 21 IT applications 78.8 5.5 \u2010 (39.7) 0.2 39.8 84.6 524.5 (439.9) Concessions and other rights of use 130.2 0.3 \u2010 (16.8) \u2010 0.1 113.8 471.6 (357.8) Public services under concession 2,860.1 181.1 (4.5) (160.9) 4.7 82.9 2,963.4 5,144.1 (2,180.7) Customer lists 546.3 \u2010 \u2010 (34.8) 64.7 \u2010 576.2 693.9 (117.7) Other intangible assets 67.7 33.3 \u2010 (26.9) 0.2 5.1 79.4 225.8 (146.4) Intangible assets under construction, public services under concession 169.5 144.4 (0.8) \u2010 \u2010 (75.7) 237.4 237.4 \u2010 Intangible assets under construction 71.8 52.2 \u2010 (0.9) \u2010 (51.2) 71.9 71.9 \u2010 Total 3,924.4 416.8 (5.3) (280.0) 69.8 1.0 4,126.7 7,369.2 (3,242.5) 31 Dec 22 IT applications 84.6 4.5 \u2010 (42.9) 0.1 36.2 82.5 565.7 (483.2) Concessions and other rights of use 113.8 0.5 \u2010 (15.8) 12.0 0.3 110.8 483.8 (373.0) Public services under concession 2,963.4 208.3 (4.7) (174.9) \u2010 192.4 3,184.5 5,595.3 (2,410.8) Customer lists 576.2 \u2010 \u2010 (39.4) 44.3 \u2010 581.1 741.8 (160.7) Other intangible assets 79.4 43.4 0.0 (33.5) 0.1 3.5 92.9 269.7 (176.8) Intangible assets under construction, public services under concession 237.4 166.8 (0.4) \u2010 \u2010 (129.9) 273.9 273.9 \u2010 Intangible assets under construction 71.9 60.4 \u2010 (0.3) \u2010 (40.3) 91.7 91.7 \u2010 Total 4,126.7 483.9 (5.1) (306.8) 56.5 62.2 4,417.4 8,021.9 (3,604.5) \u201cIT applications\u201d refers to costs incurred in purchasing licenses and implementing corporate information systems. \u201cConcessions and other rights of use\u201d mainly includes: \u25aa concessions, for 37.8 million euro, primarily involving the rights relating to the activities of gas distribution and integrated water cycle, classified as intangible assets even before the IFRIC 12 interpretation \u201cService concession arrangements\u201d was first applied; \u25aa the authorisation to operate the Serravalle Pistoiese landfill, for 53.4 million euro, an asset recorded as part of the a business combination operation carried out in previous periods and amortised on the basis of the number of tons consigned. \u201cPublic services under concession\u201d includes assets relating to gas distribution, electricity distribution (Imola area), the integrated water cycle and public lighting activities (except for the latter, as specified in note 18 \u201cCurrent financial assets, cash and cash equivalents\u201d) provided through contracts awarded by the respective public bodies. These concession relationships and associated assets involved in carrying out the activities for which the Group holds the use rights, are accounted for by applying the intangible asset model as set forth by IFRIC 12 interpretation. Investments for the year related mainly to the water networks, in the amount of 118.7 million euro, and gas distribution networks, in the amount of 51.5 million euro. It should be noted that, during the year, the item was changed by the reclassification of the assets related to the urban sanitation service in the areas of Bologna and Modena, which were previously classified as tangible assets due to the different regulatory framework, following the awarding of the tender for the area, as reported in detail in Note 21 \u201cTangible assets\u201d. Depreciation and amortization for the period, up sharply from last year, is therefore also affected by the above reclassification. \u201cIntangible assets under construction and public services under concession\u201d includes investments related to these concessions that are still to be completed at the end of the period and mainly refers to the water networks, in the amount of 89.8 million euro, and gas distribution networks, in the amount of 34.3 million euro. \u201cIntangible assets under construction\u201d essentially comprises IT projects that have not yet been completed. \u201cCustomer lists\u201d are recorded as a result of business combination transactions and the consequent valuation of the assets acquired. The amortisation period of these customer lists is correlated to the churn rate identified for each individual transaction. Depreciation and amortisation for the period increased compared with the comparison period due to the recognition of customer lists as a result of the control acquisitions in the second half of the 2021 financial year and during the 2022 financial year. The item \u201cOther intangible assets\u201d refers mainly to the rights of use for networks and infrastructures for the passage and laying down of telecommunication networks and the incremental costs incurred for obtaining new sale contracts. In particular, the commissions recognized as assets for the 2022 fiscal year amounted to 36 million euro (24.8 million euro for 2021), and the significant increase in amortisation for the period is due to them. \u201cOther changes\u201d include reclassifications of fixed assets under construction to their specific categories in the case of assets that came into operation during the year and reclassifications from/to tangible assets, especially in the case of assets subject to concession activities, as mentioned under \u201cPublic services under concession\u201d. \u201cChange in scope of consolidation\u201d reflects the control acquisitions made during the year, for details of which please refer to the section \u201cBusiness combination (supplementary information)\u201d contained in Section 2.02.10 \u201cOther information\u201d.", "dimensions": { "concept": "ifrs-full:DisclosureOfIntangibleAssetsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-58": { "value": "24 Goodwill 31 Dec 22 31 Dec 21 Change Goodwill 848.1 842.9 5.2 The value of goodwill at 31 December 2022 mainly reflects the following operations: \u25aa Acquisition of control of the \u201cAscopiave business activities,\u201d i.e. the companies EstEnergy Spa, Ascotrade Spa, Ascopiave Energie Spa, Blue Meta Spa, Etra Energia Srl and Amgas Blu Srl, which took place in 2019 for a total of 431.2 million euro; \u25aa integration that in 2002 resulted in the creation of Hera Spa, totalling 81.3 million euro; \u25aa acquisition of control through the merger of Agea Spa, taking place in January 2004, amounting to 41.7 million euro: \u25aa acquisition of control over Gruppo Meta which took place during the 2005 financial year, as a result of the merger of Meta Spa into Hera Spa, totalling 117.7 million euro; \u25aa acquisition of control over Sat Spa through the merger into Hera Spa, taking place during 2008, amounting to 54.9 million euro: \u25aa acquisition of control over the Aliplast Group taking place in 2017, totalling 25 million euro; \u25aa acquisition of control over the Marche Multiservizi Group, amounting to 20.8 million euro. As reported in Section \u201cBusiness Combinations (supplementary information)\u201d of section 2.02.10 of \u201cOther information\u201d, during the 2022 fiscal year business combinations took place resulting in an increase in goodwill. Below is the value of goodwill broken down by operating segment: 31 Dec 22 31 Dec 21 Change Gas 493.5 494.8 (1.3) Waste management 233.5 228.3 5.2 Electricity 73.5 72.2 1.3 Water cycle 42.7 42.7 \u2010 Other services 4.9 4.9 \u2010 Total 848.1 842.9 5.2 ", "dimensions": { "concept": "ifrs-full:DisclosureOfGoodwillExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-59": { "value": "25 Impairment tests on assets Cash-generating and goodwill units Assets and goodwill have been subjected to impairment tests by determining the value in use, which is the current value of operating cash flows (duly discounted according to the dcf - discounted cash flow method) resulting from the 2022 - 2026 business plan approved by the Board of Directors of the parent company at its meeting 8 February 2023. The impairment test was applied to the following CGUs (Cash generating units): gas, electricity, integrated water management, environmental and other services (Public lighting and telecommunications) that are consistent with the business areas used for internal periodic reporting and with the information contained in the annual financial report in paragraph 2.02.10 \u201cOther Information\u201d. In relation to this, it should be noted that the Group has implemented a structured process for preparing and reviewing the business plan, which involves formulating the Plan on an annual basis according to an external context scenario that takes into account the market trends and rules for regulated businesses, with the support of all the business units and following a bottom-up logic. Specifically, assumptions were implemented in developing the 2022-2026 Business Plan consistent with those used in previous plans and, on the basis of the final reported values, forecasts were developed that refer to the most authoritative and up external sources available wherever necessary. Revenues for regulated business areas were developed on the basis of the evolution of the rates deriving from national regulations and/or agreements with the Area Authority. In particular, revenues from energy distribution were forecasted according to the principles of ARERA 737/22 (RTDG) and 568/19 (TIT) resolutions for gas and electricity respectively, and taking into account the respective WACC values set by ARERA. These rates were approved until the year 2023 in the integrated reference text (TIWACC 2022-2027, Resolution 614/21 as amended), while for subsequent years they were updated in accordance with the methodology of the same resolution and according to the forecasted financial and fiscal parameters integrated into the approved business plan. Revenues from energy sales under protected conditions and with regard to services of last resort have instead been estimated on the basis of the respective regulatory reference texts, i.e. the TIV (resolutions 208/2022 and 491/2020/R/EEL) for electricity and TIVG (approved by resolution ARG/GAS/64/09, as amended) for gas. For integrated water management, the hypothesis used to forecast revenues assumed no change in the volumes distributed and was based on the rates originating from the agreements in effect with ATERSIR and the application of the Water Rate method (MTI-3) set forth by ARERA resolution no. 639/21, also taking account the parameters underlying the hedging of financial and tax charges, among other factors. For urban sanitation, the hypothesis formalized involved achieving full rate coverage over all the areas served within the duration of the plan, consistent with the provisions of rules currently in effect. Price trends for electric energy and gas bought and sold in the open market were worked out on the basis of business considerations consistent with the planned energy scenario, considering the forecasts provided by a panel of institutional observers. The development of plants for the treatment and recycling of waste is consistent with the forecasts of the provincial plans for the provinces in which the Hera Group operates. The investment schedule and the subsequent start of new plants is the result of the best estimate of the managers in charge. The inertial evolution of the Group\u2019s costs in the plan timeframe was developed by formulating hypotheses based on the information available. In relation to employees and labour costs, instead, the indications included in the various types of employment contracts were considered. The first year of the plan represents the base reference for identifying economic, financial and management objectives that converge in the annual budget, the guiding operational element for achieving the Group\u2019s growth objectives. The cash flows generated were therefore determined using the data for the 2023 - 2026 period as a base. In particular, the net profit margin was used, from which taxes were deducted, depreciation and provision were added and the maintenance investments planned for each year of the plan were deducted. Following the last year of the plan, Free cash flows were considered equal to the value of the Net operating profit for the last year of the plan, in the event that the value of depreciation and provisions remains at the level of the investments. In the event that the plan does not take into account the prediction of future events that significantly influence estimated cash flows as a result of its medium-term timeframe, adjustments were applied in order to also incorporate the effects of such events. The cash flows are calculated by applying the growth rate (g) to the normalised Free Cash Flows with the medium/long-term timeframe for the relevant sector (2% on average) for the 2027-2042 period (20 years total). For regulated services, these flows are brought into line with the expected continuation of market share following the completion of the expected calls for tenders. These flows are supplemented by the current value of perpetuity, calculated as follows: \u25aa For market activities, the cash flow resulting from the application of the perpetuity criterion for the last year (2042) was considered, assuming an average factor growth of 2%; \u25aa for services under contract, the terminal value was established by considering the cash flow resulting from the application of the perpetuity criterion weighted by the percentage of competitive bidding processes that the Group is expected to win at the end of the contract periods (100% for network services, 80% for urban sanitation services) and the redemption value of assets weighted by the proportion of competitive bidding processes which the Group expected not to win. This value was estimated as equal to the current value of the net book value of assets owned and leasehold improvements, less the recovery values, in order to properly represent the non-renewal of the contract and the subsequent sale of the assets to the new operator with a value equal to the remaining book value. To discount unlevered cash flows, the rate used was the weighted average cost of capital (WACC), which represents the yield expected by the funders and shareholders of the company for the use of equity capital, adjusted for the risk of the specific country in which the asset being valued. The value of the specific country risk to be included in the discount rate is defined on the basis of information provided by external providers. Since the Group has a diversified business portfolio with a balance of regulated and free-market activities that make it less exposed to cyclical trends in the economy, it was decided to maintain the historical methodological approach which involves a 9 /12-month observation of the variables underlying the Wacc calculation. At the same time, in order to formulate a view of the effects of a possible medium- to long-term financial shock, a \"Stressed\" scenario was developed that would take into account current market conditions albeit in a particularly volatile environment. Specifically, the rates used for the purposes of the actual and scenario assessments are as follows: 2022 Base 2022 Stressed 2021 Base Wacc Gas \u2013 Electricty \u2013 Water Cycle \u2013 Other Services 4.58% 5.80% 4.27% Wacc waste management 5.36% 6.35% 5.15% The outcomes of the test were positive for all Cgu, showing a use value higher than the book value. In view of this, two sensitivity scenarios were hypothesised: \u25aa an initial analysis focused on the marginality of the individual businesses, hypothesizing a 5% decrease that would result in a reduction in the cash flows developed in the years covered by the plan and subsequent years. \u25aa the second analysis, hypothesising discounting all cash flows, used the \"Stressed\" Wacc. In both of these scenarios, the values obtained are higher than those recorded in the balance sheets, therefore this analysis has further confirmed the carrying values. Assessments concerning climate change scenarios and consequent sensitivity Th electrification of energy consumption is one of the most significant risks/opportunities related to climate change. Achieving climate change mitigation, as defined through emission reduction targets at the European level and translated on a national basis with related implementation plans, requires initiatives to change both the technologies adopted to meet energy needs and measures to make them more efficient. The Hera Group has therefore begun conducting specific analyses aimed at identifying the possible impacts of the scenario of transition on the evolution of end customers\u2019 energy consumption, with reference to the business areas it has selected within a timeframe that extends up to 2040. The analyses took into account exogenous drivers, such as national and European policies on the topic and consumer preferences, drivers of change, and related enabling technologies. The results have allowed the company to gauge the impact that the transitional scenario could have on the evolution of gas and electricity consumption as a function of key determinants such as energy efficiency, technology mix, mobility, and self-consumption. These analyses confirmed, in particular, the widespread expectation that the future will witness a growth in electricity consumption and a simultaneous reduction in gas consumption. With reference to the businesses operated by the Group, the assessments conducted necessarily took into account the differing nature of the regulated distribution business and the free-market sales business. Regarding the gas distribution business, it should first be mentioned that ordinary and extraordinary maintenance activities, for which tariff remuneration is provided, are correlated to the physicality of the assets and not to the volumes of gas distributed. Indeed, renovation work is mainly carried out to resolve critical issues through event-driven interventions, resulting, for example, from a network or plant leakage or breakdown, or through scheduled operations to comply with the dictates of technical and regulatory standards. The transitional risk related to climate change thus appears to depend on purely regulatory decisions and future systemic developments in the gas distribution network. One prospect considered likely by the Group is that the drivers generating gas network development needs might change from the need to meet consumption demands to the need to meet input requirements for biomethane and green gas in general that can enable the running of energy production systems using renewable sources. In this respect, ARERA has also shown interest in exploring issues related to possible transition costs that may emerge when there is a decline in consumption and thus a decline in the use of this energy vector. The 2022-25 Strategic Framework reveals an awareness of the need to reflect on which market and regulatory tools might be the most suitable to facilitate the carrying out of investments that are of real benefit to the system, in compliance with efficiency and economic sustainability criteria. At present, however, the Regulatory Authority has not issued any measures, deeming that it is proceeding in full accordance with the current regulatory criteria. Therefore, on the basis of these considerations, the Group does not judge that any elements can be identified in the current framework to assume that the system will be severely disrupted without mechanisms in place to protect the financial equilibrium of companies providing gas distribution services. Electricity distribution, on the other hand, is set to have an ever increasing impact on the energy grid due to the electrification of consumption. This may in effect represent a development opportunity for the Group, especially when the current concessions are put up for tender. Relative to sales activity, a model scenario extending beyond the horizon of the plan was formulated that, taking into account transitional risks, projects customer consumption by service and type of use through to 2040. In particular, by considering the various effects of energy efficiency and transition dynamics, average volumes by customer cluster were calculated and growth/decrease rates over time were applied to these calculated volumes. To provide an estimate of overall marginality, intermediate steps were taken, estimating the evolution of the customer base in terms of supply points, to which an average volume per segment was attributed, adjusted over time to consider the impact of energy transition. Assuming that the margins hypothesized in the business plan for each service/segment remain constant over time, a significant growth in electricity margins was estimated for the period 2027-2040, associated with a lesser reduction in gas margins. In order to conduct a sensitivity analysis in relation to the impairment test, projections for natural gas sales were incorporated into the valuation models, both adjusting the annual cash flows up to 2040 (based on the assumptions made previously) by an average of 8 million euro and normalizing the cash flow used to calculate the terminal value by an analogous amount. In this hypothetical scenario as well, the results confirm the full recoverability of the asset values recorded in the balance sheet. An additional physical risk that may impact the Group is increased temperatures. Therefore, an additional medium- to long-term Cgu gas stress scenario was developed that would take into account the effects of an increase in average winter temperatures. Specifically, the projected increase in the RCP8.5 scenario is 1.5\u00b0C up to 2030 2\u00b0C up to 2050, relative to the 1981-2010 average. In relation to the climate assumptions for estimating gas sales volumes for the purposes of the Business Plan, this results in an 0.7\u00b0C increase up to 2030 and an 1.2\u00b0C increase up to 2050, respectively. Based on this scenario, again with a planning horizon up to 2040, a sensitivity analysis was developed to take into account a consequent reduction in Cgu gas margins ( please also refer to the section of the Directors' Report 1.02.03 \"Environmental-Catastrophic Risk Management\"). In this case, too, the results obtained confirm the full recoverability of the values of the assets recorded in the financial statements 27 Impairment tests on shareholdings With reference to the market for electric generation, in the presence of impairment indicators and in keeping with previous financial periods, an in-depth analysis was performed to determine the recoverable amount of the Group\u2019s investments, and related financial assets, operating in the sector. In particular, the analysis was conducted by discounting the value of the cash flows expected to be generated over the remaining useful lives of the plants of Set Spa and Tamarete Energia Srl In the 2022 financial year, as a result of the significant increase in gas prices, there was a significant effect on prices in Mgp and the presence of a negative baseload Clean spark spread (Css). Emerging trend signals show short-term opportunities offered by moderately positive baseload Css values, while in the medium to long term the outlook is leaning toward a consolidation towards slightly negative values, against, however, positive modulated Css. The factors that have determined the performance of the electricity generation market during this decade are due to the combination of multiple factors on both demand and supply sides. The main factors affecting current price dynamics are to be found in: \u25aa introduction of significant production capacity in renewable energy in the past few years; \u25aa moderate GDP growth and consumption efficiency (driven by European and national environmental policy objectives) reflected in the low growth in demand for energy; \u25aa European and national policies in relation to CO2 emission reduction targets and targets for renewable energy affecting supply. On the basis of new scenarios developed, it is believed that the market will evolve towards levels of baseload Clean spark spread aligned in the short term to the recent historical level, while they will be slightly negative in the medium to long term, in particular due to a combination of multiple effects, including: \u25aa new high-efficiency incoming capacity (CCGT) beginning in 2022, which will replace coal-powered plants with a view to phasing out coal by 2025; \u25aa beginning of the end-of-life cycle of the old CCGT plants, which, from the second half of the decade, creates favourable market conditions for highly efficient and flexible retrofits of the old CCGT plants, whose remuneration and return on investment are ensured by the participation in MGP and MSD, additionally ensuring a higher level of suitability of the system in the medium-long term and therefore less room for marginality growth in the absence of such investments; \u25aa resulting unincreased marginality in the MGP market; \u25aa growing role of renewable sources, also supported by the need to reduce dependency not only on fossil fuels in general but also on specific geopolitical areas. That said, future cash flows determined on the basis of the medium/long-term energy scenario the Group considered to be the most likely, formulated on the basis of independent expert assumptions consistent with growth expectations for energy demand, installed power, the demand for combined cycle and the system\u2019s expected reserve margin. This scenario alters the one used in the previous exercise, affecting future Clean spark spread values. The estimated cash flows were discounted using a 5.21% WACC, calculated in the same way as shown for the cash flow generating units, as indicated in note 25 \u201cImpairment tests on assets\u201d. Specifically, the rates used for the purposes of the actual and scenario assessments are as follows: 2022 Base 2022 Stressed 2021 Base Electricity generation WACC 5.21% 6.18% 5.04% The outcome of the test confirmed the full recoverability of the values relating to Set Spa, while it confirmed a highly critical scenario for Tamarete Energia Srl, as it found there are not the prerequisites for recovering the sums invested. In addition, two sensitivity scenarios were hypothesised: \u25aa an initial analysis was developed by decreasing the Css by 1 euro/MWh, resulting in reduced cash flows developed over the life years of the plants; \u25aa a second analysis, hypothesising the discounting of all cash flows used the \"Stressed\" WACC. Under both scenarios, this would result in the full recoverability of Set Spa's book values. At the end of the valuation process, the carrying amount of financial assets, shareholdings and receivables attributable to Set Spa was 43.3 million euro, while the financial assets attributable to Tamarete Energia Srl were written down in full. The Group has estimated the possible financial undertaking necessary to guarantee the business continuity of Tamarete Energia Srl should the future negative scenario be confirmed as amounting to approximately 2.9 million euro, recording a liability of the same amount as an implicit obligation. ", "dimensions": { "concept": "ifrs-full:DisclosureOfImpairmentOfAssetsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-503": { "value": "Changes in consolidated shareholdings using the net equity method are as follows: Opening value Investments and disinvestments Profit for the fin. year Dividends paid out Changes in the scope of consolidation Write-downs and other changes Terminal value 31 Dec 21 Enomondo Srl 15.6 \u2010 3.1 (1.1) \u2010 \u2010 17.6 Total joint ventures 15.6 \u2010 3.1 (1.1) \u2010 \u2010 17.6 Aimag Spa 50.6 \u2010 3.7 (2.6) \u2010 \u2010 51.7 Set Spa 27.9 \u2010 0.6 \u2010 \u2010 \u2010 28.5 Sgr Servizi Spa 24.4 \u2010 3.0 (2.2) \u2010 \u2010 25.2 ASM SET Srl 18.7 \u2010 1.4 (1.2) \u2010 \u2010 18.9 SEA - Servizi Ecologici Ambientali Srl \u2010 \u2010 1.4 (2.4) 9.7 \u2010 8.7 Total associated companies 121.6 \u2010 10.1 (8.4) 9.7 \u2010 133.0 Total 137.2 \u2010 13.2 (9.5) 9.7 \u2010 150.6 31 Dec 22 Enomondo Srl 17.6 \u2010 3.1 (2.2) \u2010 0.3 18.8 Total joint ventures 17.6 \u2010 3.1 (2.2) \u2010 0.3 18.8 Aimag Spa 51.7 \u2010 2.3 (2.8) \u2010 \u2010 51.2 Set Spa 28.5 \u2010 (0.6) \u2010 \u2010 \u2010 27.9 Sgr Servizi Spa 25.2 \u2010 2.4 (2.0) \u2010 (0.1) 25.5 ASM SET Srl 18.9 \u2010 1.5 (1.4) \u2010 (0.1) 18.9 SEA - Servizi Ecologici Ambientali Srl 8.7 \u2010 1.3 (1.0) \u2010 0.1 9.1 Total associated companies 133.0 \u2010 6.9 (7.2) \u2010 (0.1) 132.6 Total 150.6 \u2010 10.0 (9.4) \u2010 0.2 151.4 The result for the year decreased from the previous year mainly due to the lower results reported by Aimag Spa, a multi-utility company operating in the province of Modena area, and Set Spa, an investment vehicle for a combined-cycle power plant located in Teverola (CE). On the other hand, the results of the company Enomondo Srl, operating in the production of thermal energy and electricity from biomass combustion plants, remained constant. No impairments or reversals of impairments were reported for companies within the scope of consolidation. For more details on the assumptions and results of the impairment tests to which the carrying values of the investments in affiliates that represent vehicles through which the Group holds shares in the production of electric generation plants (Set Spa and Tamarete Energia Srl) were subjected, please see the information in Note 27 \u201cImpairment tests on shareholdings\u201d below. Associated companies and joint ventures ", "dimensions": { "concept": "ifrs-full:DisclosureOfInterestsInOtherEntitiesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-60": { "value": "Investments in companies not included in the scope of consolidation underwent the following changes: Fair value hierarchy Opening value Investments and disinvestments Fair value valuations Other changes Terminal value 31 Dec 21 Ascopiave Spa 1 42.0 \u2010 (2.1) \u2010 39.9 Veneta Sanitaria Finanza di Progetto Spa 3 3.6 \u2010 \u2010 \u2010 3.6 Other minor companies 3 5.1 1.3 (2.0) \u2010 4.4 Total 50.7 1.3 (4.1) \u2010 47.9 31 Dec 22 Ascopiave Spa 1 39.9 \u2010 (12.3) \u2010 27.6 Veneta Sanitaria Finanza di Progetto Spa 3 3.6 \u2010 \u2010 \u2010 3.6 Other minor companies 3 4.4 3.2 \u2010 0.1 7.7 Total 47.9 3.2 (12.3) 0.1 38.9 In the case of shareholdings with a fair value hierarchy of 1, the value adjustment, recorded in the components of the comprehensive income statement, makes it possible to align the book value of the shares with the market prices at the end of the year. In the case of hierarchy 3 shareholdings, partly in view of the insignificant value of the investments in the portfolio, the change in fair value was not significant. Investments for the period are mainly attributable to the purchase of minority shares in Aurora Srl, as specified above. Other share- holdings ", "dimensions": { "concept": "ifrs-full:DisclosureOfInvestmentsOtherThanInvestmentsAccountedForUsingEquityMethodExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-489": { "value": "Below are presented the main aggregate values of the joint venture Enomondo Srl as well as companies with significant influence (Aimag Spa, ASM SET Srl, SEA Srl, Set Spa, Sgr Servizi Spa and Tamarete Energia Srl): Assets Company Joint ventures Company Associated companies Total Non-current assets Tangible assets 34.3 410.6 444.9 Rights of use 0.6 0.6 Intangible assets 53.4 53.4 Goodwill 105.0 105.0 Shareholdings 7.0 7.0 Financial assets 0.5 12.9 13.4 Deferred tax assets 0.7 4.5 5.2 Total non-current assets 35.5 594.0 629.5 Current assets Inventories 0.5 23.3 23.8 Trade receivables 7.3 337.6 344.9 Contract work in progress 3.0 3.0 Financial assets 9.1 9.1 Current tax assets 3.5 3.5 Other current assets 6.5 99.8 106.3 Derivative instruments 0.6 0.6 Cash and cash equivalents 8.0 29.3 37.3 Total current assets 22.9 505.6 528.5 Total assets 58.4 1,099.6 1,158.0 Investee data Net equity and liabilities Company Joint ventures Company Associated companies Total Share capital and reserves Share capital 14.0 88.0 102.0 Reserves 17.4 281.8 299.2 Profit (loss) for the period 6.1 26.6 32.7 Group net equity 37.5 396.4 433.9 Non-controlling interests 14.3 14.3 Total net equity 37.5 410.7 448.2 Non-current liabilities Non-current financial liabilities 7.2 213.5 220.7 Non-current lease liabilities 0.4 0.4 Post-employment and other benefits 5.6 5.6 Provisions for risks and charges 1.0 37.8 38.8 Deferred tax liabilities 0.1 0.7 0.8 Derivative financial instruments 0.1 0.1 Total non-current liabilities 8.3 258.1 266.4 Current liabilities Current financial liabilities 3.0 145.8 148.8 Current lease liabilities 0.1 0.1 Trade payables 8.6 255.2 263.8 Current tax liabilities 0.3 0.3 Other current liabilities 1.0 29.4 30.4 Total current liabilities 12.6 430.8 443.4 Total liabilities 20.9 688.9 709.8 Total net equity and total liabilities 58.4 1,099.6 1,158.0 Income statement Company Joint ventures Company Associated companies Total Revenues 28.8 1,265.9 1,294.7 Other operating revenues 3.5 2.5 6.0 Raw materials and materials (2.5) (1,015.1) (1,017.6) Service costs (15.8) (100.0) (115.8) Personnel costs (0.4) (29.3) (29.7) Amortisation, provisions and depreciation (5.4) (55.9) (61.3) Other operating costs (0.1) (22.2) (22.3) Operating revenues 8.1 45.9 54.0 Financial income 5.0 5.0 Financial expenses (0.2) (9.5) (9.7) Total financial management (0.2) (4.5) (4.7) Other non-operating revenues (expenses) (1.3) (1.3) Earnings before taxes 7.9 40.1 48.0 Taxes for the period (1.8) (12.3) (14.1) Net revenues for the period 6.1 27.8 33.9 ", "dimensions": { "concept": "ifrs-full:DisclosureOfJointVenturesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-469": { "value": "Below are presented the main aggregate values of the joint venture Enomondo Srl as well as companies with significant influence (Aimag Spa, ASM SET Srl, SEA Srl, Set Spa, Sgr Servizi Spa and Tamarete Energia Srl): Assets Company Joint ventures Company Associated companies Total Non-current assets Tangible assets 34.3 410.6 444.9 Rights of use 0.6 0.6 Intangible assets 53.4 53.4 Goodwill 105.0 105.0 Shareholdings 7.0 7.0 Financial assets 0.5 12.9 13.4 Deferred tax assets 0.7 4.5 5.2 Total non-current assets 35.5 594.0 629.5 Current assets Inventories 0.5 23.3 23.8 Trade receivables 7.3 337.6 344.9 Contract work in progress 3.0 3.0 Financial assets 9.1 9.1 Current tax assets 3.5 3.5 Other current assets 6.5 99.8 106.3 Derivative instruments 0.6 0.6 Cash and cash equivalents 8.0 29.3 37.3 Total current assets 22.9 505.6 528.5 Total assets 58.4 1,099.6 1,158.0 Investee data Net equity and liabilities Company Joint ventures Company Associated companies Total Share capital and reserves Share capital 14.0 88.0 102.0 Reserves 17.4 281.8 299.2 Profit (loss) for the period 6.1 26.6 32.7 Group net equity 37.5 396.4 433.9 Non-controlling interests 14.3 14.3 Total net equity 37.5 410.7 448.2 Non-current liabilities Non-current financial liabilities 7.2 213.5 220.7 Non-current lease liabilities 0.4 0.4 Post-employment and other benefits 5.6 5.6 Provisions for risks and charges 1.0 37.8 38.8 Deferred tax liabilities 0.1 0.7 0.8 Derivative financial instruments 0.1 0.1 Total non-current liabilities 8.3 258.1 266.4 Current liabilities Current financial liabilities 3.0 145.8 148.8 Current lease liabilities 0.1 0.1 Trade payables 8.6 255.2 263.8 Current tax liabilities 0.3 0.3 Other current liabilities 1.0 29.4 30.4 Total current liabilities 12.6 430.8 443.4 Total liabilities 20.9 688.9 709.8 Total net equity and total liabilities 58.4 1,099.6 1,158.0 Income statement Company Joint ventures Company Associated companies Total Revenues 28.8 1,265.9 1,294.7 Other operating revenues 3.5 2.5 6.0 Raw materials and materials (2.5) (1,015.1) (1,017.6) Service costs (15.8) (100.0) (115.8) Personnel costs (0.4) (29.3) (29.7) Amortisation, provisions and depreciation (5.4) (55.9) (61.3) Other operating costs (0.1) (22.2) (22.3) Operating revenues 8.1 45.9 54.0 Financial income 5.0 5.0 Financial expenses (0.2) (9.5) (9.7) Total financial management (0.2) (4.5) (4.7) Other non-operating revenues (expenses) (1.3) (1.3) Earnings before taxes 7.9 40.1 48.0 Taxes for the period (1.8) (12.3) (14.1) Net revenues for the period 6.1 27.8 33.9 ", "dimensions": { "concept": "ifrs-full:DisclosureOfSignificantInvestmentsInAssociatesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-418": { "value": "Derivatives and related instruments The derivative instruments used by the Group are divided into two types based on the underlying assets hedged: interest and exchange rates with reference to financing transactions, and commodities with reference to the commercial purchase and sale of gas and electricity. All commodity derivatives are classified as current assets and liabilities by virtue of the high level of liquidity and the operational time span that characterise these instruments. 29 Derivative instruments At 31 December 2022, the net exposure of interest and foreign exchange derivatives was negative, albeit slightly up from the previous year. In contrast, the net exposure of commodity derivatives, which is significantly higher than last year, reflects the increase in energy commodity prices. 31 Dec 22 31 Dec 21 Change Fair value assets Fair value liabilities Net effect Fair value assets Fair value liabilities Net effect Net effect Interest/exchange rate derivatives Loans 0.5 \u2010 0.5 \u2010 0.1 (0.1) 0.6 Foreign currency loans 0.5 6.3 (5.8) 6.9 13.4 (6.5) 0.6 Total interest/exchange rate derivatives 1.0 6.3 (5.4) 6.9 13.5 (6.6) 1.3 Commodity derivatives \u2010 \u2010 \u2010 Commercial portfolio 1,531.0 1,244.3 286.8 1,716.1 1,616.6 99.5 187.4 Trading portfolio 91.2 103.4 (12.2) 81.3 86.6 (5.3) (6.8) Total commodity derivatives 1,622.2 1,347.6 274.6 1,797.4 1,703.3 94.1 180.5 Total derivatives 1,623.2 1,353.9 269.2 1,804.3 1,716.8 87.5 181.7 of which non current 1.0 6.3 6.9 13.5 of which current 1,622.2 1,347.6 1,797.4 1,703.3 The financial management policy envisages the use of hedging instruments to effectively offset changes in the fair value, cash flows of the hedged instrument or, more specifically, changes in interest and exchange rate fluctuations that affect the sources of funds used. At 31 December 2022, the net exposure in terms of fair value with regard to current and non-current interest and foreign exchange derivatives in the form of interest rate swaps (IRSs) and cross currency swaps (CCSs) is negative compared to the previous year and is due to the increase in interest rate curves, the strengthening of the euro over the yen, and the realisation of cash flows. The operational management of commodities, on the other hand, is carried out through a process that identifies objectives, strategies and responsibilities for each existing operation. Contracts, both financial and physical in nature, are classified into the commercial or trading portfolios according to the purpose of the contracts. The Group\u2019s internal organisational model make it possible to identify the nature of the operation (commercial or trading) and produce the information required for a formal identification of the purpose of derivatives. The centralised management of hedging transactions allows for all possible synergies for hedging the electricity consumption needs of the Central Market Department, and is integrated with exchange rate transactions towards the market and is carried out through the exclusive use of swap contracts or other authorised derivatives. 2.02.07 All other derivatives or similar instruments that are not intended to hedge the Group\u2019s requirements are classified in the trading portfolio. In the 2022 fiscal year, commodity derivatives showed a significantly higher net positive exposure than in the previous year, largely related to the significant increase in energy commodity prices, which were also reflected in higher commodity costs (gas and electricity). Interest rate derivatives Interest rate and foreign exchange derivative instruments held as of 31 December 2022, subscribed in order to hedge loans, can be classed into the following categories: 31 Dec 22 31 Dec 21 Type Fair value hierarchy Notional Fair value assets Fair value liabilities Notional Fair value assets Fair value liabilities Cash flow hedges 2 8.3 mn 0.5 \u2010 9 mn \u2010 0.1 Fair value hedges 2 149.8 mn 0.5 6.3 149.8 mn 6.9 13.4 Non-hedge accounting 2 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 Total fair value 1.0 6.3 6.9 13.5 31 Dec 22 31 Dec 21 Type Fair value hierarchy Income Financial Expenses Net effect . Income Financial Expenses Net effect . Cash flow hedges 2 0.1 \u2010 0.1 0.0 \u2010 0.0 Fair value hedges 2 18.2 (21.4) (3.3) 11.0 (15.8) (4.8) Non-hedge accounting 2 \u2010 \u2010 \u2010 18.3 (18.3) (0.0) Total income (expenses) 18.3 (21.4) (3.2) 29.3 (34.1) (4.8) The positive change in the fair value of derivatives classified as cash flow hedges is mainly due to the realisation of cash flows during the period, that is, the reduction in the notional amount of the derivative. No significant ineffective portions connected to the residual financial instruments were found in the financial period. The overall effect of these instruments on the statement of comprehensive income was equal to 0.5 million euro in 2022. Derivatives designated as hedges of interest rate and exchange rate risks and of the fair value of foreign currency financial liabilities (fair value hedges), in the form of interest rate swaps (IRS) and cross currency swaps (CCS), are related to a bond denominated in Japanese yen with a remaining notional amount of 20 billion yen equal to 149.8 million euro (converted at the original exchange rate being hedged). The change in fair value is attributable to the exchange rate effect, the Japanese yen having depreciated against the euro in 2022, as well as the rise in interest rate curves. The table below provides a breakdown of financial income and expense associated with derivatives designated as fair value hedges and related underlying liabilities, as adjusted for the income and losses attributable to the hedged risk: Fair value hedges 31 Dec 22 31 Dec 21 Income Financial Expenses Net effect . Income Financial Expenses Net effect . Assessment of derivatives 13.2 (12.6) 0.6 6.4 (7.6) (1.2) Accrued interest 0.5 (0.6) (0.1) \u2010 (0.1) (0.1) Realised cash flows 4.4 (8.1) (3.6) 4.6 (8.2) (3.5) Economic effect of derivatives Fair value hedges 18.2 (21.4) (3.1) 11.0 (15.8) (4.8) Underlying amounts hedged 31 Dec 22 31 Dec 21 Fair value hedges Cash flow hedges Income Financial Expenses Net effect . Income Financial Expenses Net effect . Assessment of financial liabilities \u2010 (0.6) (0.6) 7.5 (6.4) 1.2 Last year, interest rate derivatives, identified as non-hedge accounting, matured. The category originated in full from restructuring operations and, despite not including instruments that qualify as hedges pursuant to IFRS 9, have as their main objective to hedge against interest rate fluctuations and have no impact on the income statement (mirroring). Sensitivity Analysis - Financial operations Assuming an instant change of 10% in the euro/yen exchange rate, given the same interest rates, the potential decrease in fair value of the derivative financial instruments in place at 31 December 2022 would amount to approximately 13.6 million euro. Likewise, assuming an instant reduction of the same amount, the potential fair value increase would be approximately 16.9 million euro. Given that exchange rate derivatives related to borrowing transactions are treated as fair value hedges, any change in these fair values would not have any effect on the income statement, other than for the credit adjustment part, as any such change would be offset by a movement in the opposite direction of the hedged liability. The assumptions on interest rate changes would have no significant effect on the fair value of outstanding derivative financial instruments on interest and exchange rates. Furthermore, these changes in fair value of financial instruments accounted for as cash flow hedges would have no effect on the income statement if it were not for their potential ineffective portion, which moreover is not significant. In the event of an increase or decrease in fair value, there would be a non-significant increase or decrease in net equity. As to derivatives designated as fair value hedges, any change in fair value would not have any effect on the income statement, other than for the credit adjustment part, as any such change would be essentially offset by a movement in the opposite direction of the hedged liability. Commodity derivatives Commercial portfolio The commercial portfolio includes commodity derivative instruments, both financial and physical, entered into to hedge mismatches between purchase and sale formulas, which are classed into the following categories: Operations management Type 31 Dec 22 31 Dec 21 Fair value hierarchy Notional Fair value assets Fair value liabilities Notional Fair value assets Fair value liabilities Gas formulas 3 2,863,802 MWh 974.7 27,991,358 MWh 1,309.2 Electricity formulas 2 5,293,822 MWh 556.3 4,829,772 MWh 406.8 Exchange 2 \u2010 \u2010 10,408,061 USD 0.1 Gas formulas 3 4,084,098 MWh 901.6 28,987,729 MWh 1,440.8 Electricity formulas 2 3,165,429 MWh 341.1 2,905,219 MWh 175.6 Exchange 2 62,353,000 USD 1.5 30,477,506 USD 0.2 Total fair value 1,531.0 1,244.3 1,716.1 1,616.6 Type 31 Dec 22 31 Dec 21 Income Expenses Net effect Income Expenses Net effect Assessment of derivatives 24.3 (23.0) 1.3 1.6 (1.9) (0.2) Non-hedge accounting
Realised cash flows
4,564.8
(4,579.5)
(14.7)
1,242.7
(1,279.8)
(37.1)
Economic effect of
derivatives
4,589.2
(4,602.5)
(13.4)
1,244.4
(1,281.7)
(37.4)
The main objectives of these contracts are to replicate the cash flows of the formulas on sale in the
market and to cover the spread between the Ttf price, the benchmark market for continental Europe, and
the Psv price, the virtual trading point and Italian gas hub. In order to assess the impact that fluctuations
in the market price of the underlying asset have on the financial derivatives attributable to the commercial
portfolio, the PaR (Profit at Risk) tool is used, that is the change in the value of the portfolio of derivative
financial instruments within pre-established probability hypotheses as a result of a shift in market indexes.
The increase in the net fair value of commodity derivatives related to the commercial portfolio is mainly
due to the increase in the gas price during the year and to the same dynamics recorded during the year
for the national price, which is closely related to gas price trends.
Overall effect of these instruments on the statement of comprehensive income is broken down as follows:
Commodity derivatives
commercial portfolio
31 Dec 22
31 Dec 21
Positive
components
Negative
components
Net effect
.
Positive
components
Negative
components
Net effect
.
Changes to expected cash flows
214.7
\u2010
214.7
87.6
\u2010
87.6
Reserve transferred to the income
statement
4,579.5
(4,564.8)
14.6
1,279.8
(1,242.7)
37.1
Derivatives effect on statement
of comprehensive income
cash flow hedge
4,794.2
(4,564.8)
229.3
1,367.4
(1,242.7)
124.7
The net effect of the year\u2019s expected cash flows also includes the change in the fair value of derivative
instruments previously measured using hedge accounting, for which the outstanding hedge relationship
has been terminated in relation to hedged items that have not yet matured. The components recognised
in the statement of comprehensive income will be transferred to profit and loss on the maturity dates of
the corresponding hedged positions, which are expected to occur within the next twelve months.
The effect of these instruments on the income statement is broken down as follows:
Physical contracts treated as
derivatives
Financial derivative
contracts
Overall effect
Sales revenues
4,067.2
Income
497.7
4,564.8
Purchasing costs
(4,367.5)
Expenses
(212.0)
(4,579.5)
Effect of realising derivative
cash flow hedges
(300.3)
285.6
(14.7)
Sensitivity analysis - Commercial portfolio
In assuming an instant increase of 60 euro/MWh of the TTF, with no change in the national standard
price curve, the potential decrease in the fair value of derivative financial instruments held as at 31
December 2022 would amount to approximately 219.8 million euro. On the contrary, an instant fall in the
same amount would bring about a potential increase in the fair value of the instruments of approximately
219.8 million euro.
In assuming an instant +60 euro/MWh change in the national standard price curve, with no change in
the TTF price, the potential increase in the fair value of derivative financial instruments of the commercial
portfolio held at 31 December 2022 would amount to approximately 39.7 million euro. On the contrary,
an instant change of -60 euro/MWh would bring about a potential decrease in the fair value of the
instruments of approximately 39.7 million euro.
In the organizational model described above, these changes in fair value would mainly affect derivative
instruments accounted for as hedges thus the opposite variation of net equity would be recorded in the
income statement.
Effects on statement of comprehensiv e income Effects on income statement Trading portfolio The trading portfolio includes derivatives or similar instruments that are not intended to hedge the Group\u2019s requirements and are entered into for speculative purposes. these instruments may be divided into the following categories Operations management Type 31 Dec 22 31 Dec 21 Fair value hierarchy Notional Fair value assets Fair value liabilities Notional Fair value assets Fair value liabilities Gas formulas 3 204,228 MWh 8.5 546,478 MWh 20.6 Electricity formulas 2 663,755 MWh 82.7 1,323,041 MWh 60.4 Raw oil 2 4,253 Bbl 0.1 Other commodities 2 3,578 Ton 0.3 Gas formulas 3 67,292 MWh 5.7 682,525 MWh 35.1 Electricity formulas 2 1,274,824 MWh 96.9 2,183,368 MWh 49.9 Raw oil 2 3,839 Bbl 0.1 18,514 Bbl 0.2 Other commodities 2 3,404 Ton 0.6 16,163 Ton 1.3 Total fair value 91.2 103.4 81.3 86.6 Type 31 Dec 22 31 Dec 21 Income Expenses Net effect Income Expenses Net effect Assessment of derivatives 163.7 (170.5) (6.8) 144.2 (132.7) 11.5 Realised cash flows 146.4 (51.3) 95.1 89.4 (61.3) 28.1 Economic effect of derivatives 310.1 (221.8) 88.3 233.6 (194.0) 39.6 In order to assess the impact that fluctuations in market prices of the underlying asset have on the derivatives attributable to the trading portfolio, the VaR (Value at Risk) instrument is used, that is the negative change in the value of the portfolio of derivative instruments within pre-established probability hypotheses as a result of an unfavourable shift in market indexes. The effect of these instruments on the income statement is broken down as follows: Contracts treated as derivatives Financial derivative contracts Overall effect Sales revenues 37.2 Income 109.2 146.4 Purchasing costs (33.4) Expenses (17.9) (51.3) Effect of realising derivatives 3.8 91.3 95.1 The following disclosure provides an analysis of the results of operations for the year ended 31 December 2022 for trading activity, including the effects of energy commodity contracts. Fair value Fair value Delta fair value Realised Amounts entered in the Income Statement 31 Dec 2022 31 Dec 2021 2022 31 Dec 22 Trading portfolio Gas, crude oil and other commodity formulas 2.0 (15.8) 17.8 24.9 42.6 Electricity formulas (14.2) 10.5 (24.6) 70.3 45.6 Total trading portfolio (12.2) (5.3) (6.8) 95.1 88.3 Sensitivity analysis - Trading portfolio In assuming an instant increase of 60 euro/MWh of the TTF, with no change in the national standard price curve, the potential decrease in the fair value of derivative instruments held at 31 December 2022 would amount to approximately 1.2 million euro. On the contrary, an instant fall in the same amount would bring about a potential increase in the fair value of the instruments of approximately 1.2 million euro. In assuming an instant +60 euro/MWh change in the national standard price curve, with equal TTF price, the potential increase in the fair value of derivative financial instruments of the trading portfolio held at 31 December 2022 would amount to approximately 13.7 million euro. On the contrary, an instant change of -60 euro/MWh would bring about a potential decrease in the fair value of the instruments of approximately 13.7 million euro.", "dimensions": { "concept": "ifrs-full:DisclosureOfDerivativeFinancialInstrumentsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-470": { "value": "
The positive change in the fair value of derivatives classified as cash flow hedges is mainly due to the
realisation of cash flows during the period, that is, the reduction in the notional amount of the derivative.
No significant ineffective portions connected to the residual financial instruments were found in the
financial period. The overall effect of these instruments on the statement of comprehensive income was
equal to 0.5 million euro in 2022.
Derivatives designated as hedges of interest rate and exchange rate risks and of the fair value of foreign
currency financial liabilities (fair value hedges), in the form of interest rate swaps (IRS) and cross
currency swaps (CCS), are related to a bond denominated in Japanese yen with a remaining notional
amount of 20 billion yen equal to 149.8 million euro (converted at the original exchange rate being
hedged). The change in fair value is attributable to the exchange rate effect, the Japanese yen having
depreciated against the euro in 2022, as well as the rise in interest rate curves.
The table below provides a breakdown of financial income and expense associated with derivatives
designated as fair value hedges and related underlying liabilities, as adjusted for the income and losses
attributable to the hedged risk:
Fair value hedges
31 Dec 22
31 Dec 21
Income
Financial
Expenses
Net effect
.
Income
Financial
Expenses
Net effect
.
Assessment of derivatives
13.2
(12.6)
0.6
6.4
(7.6)
(1.2)
Accrued interest
0.5
(0.6)
(0.1)
\u2010
(0.1)
(0.1)
Realised cash flows
4.4
(8.1)
(3.6)
4.6
(8.2)
(3.5)
Economic effect of derivatives
Fair value hedges
18.2
(21.4)
(3.1)
11.0
(15.8)
(4.8)
Underlying amounts hedged
31 Dec 22
31 Dec 21
Fair value hedges
Cash flow
hedges
Income
Financial
Expenses
Net effect
.
Income
Financial
Expenses
Net effect
.
Assessment of financial liabilities
\u2010
(0.6)
(0.6)
7.5
(6.4)
1.2
Commercial portfolio The commercial portfolio includes commodity derivative instruments, both financial and physical, entered into to hedge mismatches between purchase and sale formulas, which are classed into the following categories: Operations management Type 31 Dec 22 31 Dec 21 Fair value hierarchy Notional Fair value assets Fair value liabilities Notional Fair value assets Fair value liabilities Gas formulas 3 2,863,802 MWh 974.7 27,991,358 MWh 1,309.2 Electricity formulas 2 5,293,822 MWh 556.3 4,829,772 MWh 406.8 Exchange 2 \u2010 \u2010 10,408,061 USD 0.1 Gas formulas 3 4,084,098 MWh 901.6 28,987,729 MWh 1,440.8 Electricity formulas 2 3,165,429 MWh 341.1 2,905,219 MWh 175.6 Exchange 2 62,353,000 USD 1.5 30,477,506 USD 0.2 Total fair value 1,531.0 1,244.3 1,716.1 1,616.6 Type 31 Dec 22 31 Dec 21 Income Expenses Net effect Income Expenses Net effect Assessment of derivatives 24.3 (23.0) 1.3 1.6 (1.9) (0.2) Realised cash flows 4,564.8 (4,579.5) (14.7) 1,242.7 (1,279.8) (37.1) Economic effect of derivatives 4,589.2 (4,602.5) (13.4) 1,244.4 (1,281.7) (37.4) The main objectives of these contracts are to replicate the cash flows of the formulas on sale in the market and to cover the spread between the Ttf price, the benchmark market for continental Europe, and the Psv price, the virtual trading point and Italian gas hub. In order to assess the impact that fluctuations in the market price of the underlying asset have on the financial derivatives attributable to the commercial portfolio, the PaR (Profit at Risk) tool is used, that is the change in the value of the portfolio of derivative financial instruments within pre-established probability hypotheses as a result of a shift in market indexes. The increase in the net fair value of commodity derivatives related to the commercial portfolio is mainly due to the increase in the gas price during the year and to the same dynamics recorded during the year for the national price, which is closely related to gas price trends. Overall effect of these instruments on the statement of comprehensive income is broken down as follows: Commodity derivatives commercial portfolio 31 Dec 22 31 Dec 21 Positive components Negative components Net effect . Positive components Negative components Net effect . Changes to expected cash flows 214.7 \u2010 214.7 87.6 \u2010 87.6 Reserve transferred to the income statement 4,579.5 (4,564.8) 14.6 1,279.8 (1,242.7) 37.1 Derivatives effect on statement of comprehensive income cash flow hedge 4,794.2 (4,564.8) 229.3 1,367.4 (1,242.7) 124.7 The net effect of the year\u2019s expected cash flows also includes the change in the fair value of derivative instruments previously measured using hedge accounting, for which the outstanding hedge relationship has been terminated in relation to hedged items that have not yet matured. The components recognised in the statement of comprehensive income will be transferred to profit and loss on the maturity dates of the corresponding hedged positions, which are expected to occur within the next twelve months. The effect of these instruments on the income statement is broken down as follows: Physical contracts treated as derivatives Financial derivative contracts Overall effect Sales revenues 4,067.2 Income 497.7 4,564.8 Purchasing costs (4,367.5) Expenses (212.0) (4,579.5) Effect of realising derivative cash flow hedges (300.3) 285.6 (14.7)
Effects on
statement of
comprehensiv
e income
Effects on
income
statement
", "dimensions": { "concept": "ifrs-full:DisclosureOfHedgeAccountingExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-490": { "value": "Trading portfolio The trading portfolio includes derivatives or similar instruments that are not intended to hedge the Group\u2019s requirements and are entered into for speculative purposes. these instruments may be divided into the following categories Operations management Type 31 Dec 22 31 Dec 21 Fair value hierarchy Notional Fair value assets Fair value liabilities Notional Fair value assets Fair value liabilities Gas formulas 3 204,228 MWh 8.5 546,478 MWh 20.6 Electricity formulas 2 663,755 MWh 82.7 1,323,041 MWh 60.4 Raw oil 2 4,253 Bbl 0.1 Other commodities 2 3,578 Ton 0.3 Gas formulas 3 67,292 MWh 5.7 682,525 MWh 35.1 Electricity formulas 2 1,274,824 MWh 96.9 2,183,368 MWh 49.9 Raw oil 2 3,839 Bbl 0.1 18,514 Bbl 0.2 Other commodities 2 3,404 Ton 0.6 16,163 Ton 1.3 Total fair value 91.2 103.4 81.3 86.6 Type 31 Dec 22 31 Dec 21 Income Expenses Net effect Income Expenses Net effect Assessment of derivatives 163.7 (170.5) (6.8) 144.2 (132.7) 11.5 Realised cash flows 146.4 (51.3) 95.1 89.4 (61.3) 28.1 Economic effect of derivatives 310.1 (221.8) 88.3 233.6 (194.0) 39.6 In order to assess the impact that fluctuations in market prices of the underlying asset have on the derivatives attributable to the trading portfolio, the VaR (Value at Risk) instrument is used, that is the negative change in the value of the portfolio of derivative instruments within pre-established probability hypotheses as a result of an unfavourable shift in market indexes. The effect of these instruments on the income statement is broken down as follows: Contracts treated as derivatives Financial derivative contracts Overall effect Sales revenues 37.2 Income 109.2 146.4 Purchasing costs (33.4) Expenses (17.9) (51.3) Effect of realising derivatives 3.8 91.3 95.1 The following disclosure provides an analysis of the results of operations for the year ended 31 December 2022 for trading activity, including the effects of energy commodity contracts. Fair value Fair value Delta fair value Realised Amounts entered in the Income Statement 31 Dec 2022 31 Dec 2021 2022 31 Dec 22 Trading portfolio Gas, crude oil and other commodity formulas 2.0 (15.8) 17.8 24.9 42.6 Electricity formulas (14.2) 10.5 (24.6) 70.3 45.6 Total trading portfolio (12.2) (5.3) (6.8) 95.1 88.3 Sensitivity analysis - Trading portfolio In assuming an instant increase of 60 euro/MWh of the TTF, with no change in the national standard price curve, the potential decrease in the fair value of derivative instruments held at 31 December 2022 would amount to approximately 1.2 million euro. On the contrary, an instant fall in the same amount would bring about a potential increase in the fair value of the instruments of approximately 1.2 million euro. In assuming an instant +60 euro/MWh change in the national standard price curve, with equal TTF price, the potential increase in the fair value of derivative financial instruments of the trading portfolio held at 31 December 2022 would amount to approximately 13.7 million euro. On the contrary, an instant change of -60 euro/MWh would bring about a potential decrease in the fair value of the instruments of approximately 13.7 million euro.", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialLiabilitiesHeldForTradingExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-504": { "value": "Trading portfolio The trading portfolio includes derivatives or similar instruments that are not intended to hedge the Group\u2019s requirements and are entered into for speculative purposes. these instruments may be divided into the following categories Operations management Type 31 Dec 22 31 Dec 21 Fair value hierarchy Notional Fair value assets Fair value liabilities Notional Fair value assets Fair value liabilities Gas formulas 3 204,228 MWh 8.5 546,478 MWh 20.6 Electricity formulas 2 663,755 MWh 82.7 1,323,041 MWh 60.4 Raw oil 2 4,253 Bbl 0.1 Other commodities 2 3,578 Ton 0.3 Gas formulas 3 67,292 MWh 5.7 682,525 MWh 35.1 Electricity formulas 2 1,274,824 MWh 96.9 2,183,368 MWh 49.9 Raw oil 2 3,839 Bbl 0.1 18,514 Bbl 0.2 Other commodities 2 3,404 Ton 0.6 16,163 Ton 1.3 Total fair value 91.2 103.4 81.3 86.6 Type 31 Dec 22 31 Dec 21 Income Expenses Net effect Income Expenses Net effect Assessment of derivatives 163.7 (170.5) (6.8) 144.2 (132.7) 11.5 Realised cash flows 146.4 (51.3) 95.1 89.4 (61.3) 28.1 Economic effect of derivatives 310.1 (221.8) 88.3 233.6 (194.0) 39.6 In order to assess the impact that fluctuations in market prices of the underlying asset have on the derivatives attributable to the trading portfolio, the VaR (Value at Risk) instrument is used, that is the negative change in the value of the portfolio of derivative instruments within pre-established probability hypotheses as a result of an unfavourable shift in market indexes. The effect of these instruments on the income statement is broken down as follows: Contracts treated as derivatives Financial derivative contracts Overall effect Sales revenues 37.2 Income 109.2 146.4 Purchasing costs (33.4) Expenses (17.9) (51.3) Effect of realising derivatives 3.8 91.3 95.1 The following disclosure provides an analysis of the results of operations for the year ended 31 December 2022 for trading activity, including the effects of energy commodity contracts. Fair value Fair value Delta fair value Realised Amounts entered in the Income Statement 31 Dec 2022 31 Dec 2021 2022 31 Dec 22 Trading portfolio Gas, crude oil and other commodity formulas 2.0 (15.8) 17.8 24.9 42.6 Electricity formulas (14.2) 10.5 (24.6) 70.3 45.6 Total trading portfolio (12.2) (5.3) (6.8) 95.1 88.3 Sensitivity analysis - Trading portfolio In assuming an instant increase of 60 euro/MWh of the TTF, with no change in the national standard price curve, the potential decrease in the fair value of derivative instruments held at 31 December 2022 would amount to approximately 1.2 million euro. On the contrary, an instant fall in the same amount would bring about a potential increase in the fair value of the instruments of approximately 1.2 million euro. In assuming an instant +60 euro/MWh change in the national standard price curve, with equal TTF price, the potential increase in the fair value of derivative financial instruments of the trading portfolio held at 31 December 2022 would amount to approximately 13.7 million euro. On the contrary, an instant change of -60 euro/MWh would bring about a potential decrease in the fair value of the instruments of approximately 13.7 million euro.", "dimensions": { "concept": "ifrs-full:DisclosureOfTradingIncomeExpenseExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-471": { "value": "Trading portfolio The trading portfolio includes derivatives or similar instruments that are not intended to hedge the Group\u2019s requirements and are entered into for speculative purposes. these instruments may be divided into the following categories Operations management Type 31 Dec 22 31 Dec 21 Fair value hierarchy Notional Fair value assets Fair value liabilities Notional Fair value assets Fair value liabilities Gas formulas 3 204,228 MWh 8.5 546,478 MWh 20.6 Electricity formulas 2 663,755 MWh 82.7 1,323,041 MWh 60.4 Raw oil 2 4,253 Bbl 0.1 Other commodities 2 3,578 Ton 0.3 Gas formulas 3 67,292 MWh 5.7 682,525 MWh 35.1 Electricity formulas 2 1,274,824 MWh 96.9 2,183,368 MWh 49.9 Raw oil 2 3,839 Bbl 0.1 18,514 Bbl 0.2 Other commodities 2 3,404 Ton 0.6 16,163 Ton 1.3 Total fair value 91.2 103.4 81.3 86.6 Type 31 Dec 22 31 Dec 21 Income Expenses Net effect Income Expenses Net effect Assessment of derivatives 163.7 (170.5) (6.8) 144.2 (132.7) 11.5 Realised cash flows 146.4 (51.3) 95.1 89.4 (61.3) 28.1 Economic effect of derivatives 310.1 (221.8) 88.3 233.6 (194.0) 39.6 In order to assess the impact that fluctuations in market prices of the underlying asset have on the derivatives attributable to the trading portfolio, the VaR (Value at Risk) instrument is used, that is the negative change in the value of the portfolio of derivative instruments within pre-established probability hypotheses as a result of an unfavourable shift in market indexes. The effect of these instruments on the income statement is broken down as follows: Contracts treated as derivatives Financial derivative contracts Overall effect Sales revenues 37.2 Income 109.2 146.4 Purchasing costs (33.4) Expenses (17.9) (51.3) Effect of realising derivatives 3.8 91.3 95.1 The following disclosure provides an analysis of the results of operations for the year ended 31 December 2022 for trading activity, including the effects of energy commodity contracts. Fair value Fair value Delta fair value Realised Amounts entered in the Income Statement 31 Dec 2022 31 Dec 2021 2022 31 Dec 22 Trading portfolio Gas, crude oil and other commodity formulas 2.0 (15.8) 17.8 24.9 42.6 Electricity formulas (14.2) 10.5 (24.6) 70.3 45.6 Total trading portfolio (12.2) (5.3) (6.8) 95.1 88.3 Sensitivity analysis - Trading portfolio In assuming an instant increase of 60 euro/MWh of the TTF, with no change in the national standard price curve, the potential decrease in the fair value of derivative instruments held at 31 December 2022 would amount to approximately 1.2 million euro. On the contrary, an instant fall in the same amount would bring about a potential increase in the fair value of the instruments of approximately 1.2 million euro. In assuming an instant +60 euro/MWh change in the national standard price curve, with equal TTF price, the potential increase in the fair value of derivative financial instruments of the trading portfolio held at 31 December 2022 would amount to approximately 13.7 million euro. On the contrary, an instant change of -60 euro/MWh would bring about a potential decrease in the fair value of the instruments of approximately 13.7 million euro.", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialInstrumentsHeldForTradingExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-447": { "value": "Trading portfolio The trading portfolio includes derivatives or similar instruments that are not intended to hedge the Group\u2019s requirements and are entered into for speculative purposes. these instruments may be divided into the following categories Operations management Type 31 Dec 22 31 Dec 21 Fair value hierarchy Notional Fair value assets Fair value liabilities Notional Fair value assets Fair value liabilities Gas formulas 3 204,228 MWh 8.5 546,478 MWh 20.6 Electricity formulas 2 663,755 MWh 82.7 1,323,041 MWh 60.4 Raw oil 2 4,253 Bbl 0.1 Other commodities 2 3,578 Ton 0.3 Gas formulas 3 67,292 MWh 5.7 682,525 MWh 35.1 Electricity formulas 2 1,274,824 MWh 96.9 2,183,368 MWh 49.9 Raw oil 2 3,839 Bbl 0.1 18,514 Bbl 0.2 Other commodities 2 3,404 Ton 0.6 16,163 Ton 1.3 Total fair value 91.2 103.4 81.3 86.6 Type 31 Dec 22 31 Dec 21 Income Expenses Net effect Income Expenses Net effect Assessment of derivatives 163.7 (170.5) (6.8) 144.2 (132.7) 11.5 Realised cash flows 146.4 (51.3) 95.1 89.4 (61.3) 28.1 Economic effect of derivatives 310.1 (221.8) 88.3 233.6 (194.0) 39.6 In order to assess the impact that fluctuations in market prices of the underlying asset have on the derivatives attributable to the trading portfolio, the VaR (Value at Risk) instrument is used, that is the negative change in the value of the portfolio of derivative instruments within pre-established probability hypotheses as a result of an unfavourable shift in market indexes. The effect of these instruments on the income statement is broken down as follows: Contracts treated as derivatives Financial derivative contracts Overall effect Sales revenues 37.2 Income 109.2 146.4 Purchasing costs (33.4) Expenses (17.9) (51.3) Effect of realising derivatives 3.8 91.3 95.1 The following disclosure provides an analysis of the results of operations for the year ended 31 December 2022 for trading activity, including the effects of energy commodity contracts. Fair value Fair value Delta fair value Realised Amounts entered in the Income Statement 31 Dec 2022 31 Dec 2021 2022 31 Dec 22 Trading portfolio Gas, crude oil and other commodity formulas 2.0 (15.8) 17.8 24.9 42.6 Electricity formulas (14.2) 10.5 (24.6) 70.3 45.6 Total trading portfolio (12.2) (5.3) (6.8) 95.1 88.3 Sensitivity analysis - Trading portfolio In assuming an instant increase of 60 euro/MWh of the TTF, with no change in the national standard price curve, the potential decrease in the fair value of derivative instruments held at 31 December 2022 would amount to approximately 1.2 million euro. On the contrary, an instant fall in the same amount would bring about a potential increase in the fair value of the instruments of approximately 1.2 million euro. In assuming an instant +60 euro/MWh change in the national standard price curve, with equal TTF price, the potential increase in the fair value of derivative financial instruments of the trading portfolio held at 31 December 2022 would amount to approximately 13.7 million euro. On the contrary, an instant change of -60 euro/MWh would bring about a potential decrease in the fair value of the instruments of approximately 13.7 million euro.", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialAssetsHeldForTradingExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-61": { "value": "30 Post-employment and other benefits This includes provisions for employee leaving indemnities and other contractual benefits, net of advances paid out and payments made to the social security institutions pursuant to current regulations. The calculation is made using actuarial techniques and discounting future liabilities to the balance sheet date. These liabilities comprise the employee\u2019s matured receivables at the presumed date of leaving the company. Opening balance Service cost Financial expenses Actuarial profit (losses) Uses Other movements Changes in the scope of consolidatio n Closing balance 31 Dec 21 Post-employment 102.2 1.1 (0.1) 0.1 (11.5) 0.2 1.7 93.7 Other benefits 14.5 \u2010 \u2010 (1.7) (1.1) \u2010 \u2010 11.7 Total 116.7 1.1 (0.1) (1.6) (12.6) 0.2 1.7 105.4 31 Dec 22 Post-employment 93.7 1.4 0.2 (5.1) (11.3) \u2010 0.5 79.4 Other benefits 11.7 \u2010 0.1 2.0 (1.2) \u2010 \u2010 12.6 Total 105.4 1.4 0.3 (3.1) (12.5) \u2010 0.5 92.0 \u201cOther benefits\u201d mainly comprises the following: \u25aa The item Gas discount represents annual indemnities provided to Federgasacqua employees, hired prior to January 1980, which may be transferred to their heirs; \u25aa Premungas is a supplementary pension fund for employee members of Federgasacqua hired prior to January 1980. This fund, closed with effect from January 1997, undergoes changes on a quarterly basis solely to settle payments made to eligible retirees. \u25aa The item Tariff reduction was set up to cover the charges deriving from the acknowledgement to retired staff of the electricity business unit of tariff concessions for electricity consumption. The item \u201cService Cost\u201d regards companies with a small number of employees for whom the employee severance indemnity fund continues to represent a defined benefit plan. \u201cFinancial charges\u201d are calculated by applying a specific discount rate for each company, determined on the basis of the average financial life of the bond. \u201cActuarial profit (losses)\u201d reflects the re-measurement of the liabilities for employee benefits arising from changes in actuarial assumptions. These effects are recorded directly in the other items of the comprehensive income statement. \u201cChanges in scope of consolidation\u201d includes the post-employement provision acquired following the business combinations carried out during the period. The table below outlines the main assumptions used in the actuarial estimate of employee benefits, subdivided by geographical area: Central area North-east area Technical actuarial yearly rate 3.55% 3.60% Overall increase of salary yearly rate 2.00% 2.00% Yearly frequency of exit from work for reasons other than death 1.70% 1.70% Yarly average frequency of use of severance pay provision 2.20% 2.60% In interpreting said assumptions, account is taken of the following: \u25aa with regard to the inflation rate, the inflation assumption was inferred by adopting the Extended National Consumer Price index of 2.60% for the year 2023 and 1.7% for the following years; \u25aa for probabilities of death, ISTAT 2021 tables were consulted; \u25aa in the actuarial valuations, account was taken of the new effective dates for pensions under Law Decree of 6 December 2011, no. 201 concerning urgent measures for growth, equity, and the consolidation of public finances, as amended by Law 214 of 22 December 2011, as well as the regulation for adjusting requirements for accessing the pension system in view of increased life expectancies in accordance with Article 12 of Legislative Decree no. 78 of 31 May 2010 as amended by Law 122 of 30 July 2010; \u25aa For the probability of leaving employment for reasons other than death, an average yearly exit rate of 1.7% was hypothesized, since the analysis differentiated by professional level and sex did not result in statistically significant results; \u25aa to take into account the phenomenon of early leaving, the incidence and amount of average anticipated severance pay were hypothesized. The frequency of advance payments as well as the average percentage of severance pay requested as an advance were drawn from corporate data. The rate of severance pay requested as an advance was hypothesized at 70% of severance pay or the maximum amount set by current regulations; Actuarial projections were made on the basis of the Euro Composite AA yield curve at 31 December 2022.", "dimensions": { "concept": "ifrs-full:DisclosureOfDefinedBenefitPlansExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-62": { "value": "Sensitivity Analysis - Obligations of defined-benefit plans Assuming a 50 bps increase in the internal rate of return compared to the discount rate actually applied to value the liabilities at 31 December 2022, all other actuarial assumptions being equal, the potential decrease of the present value of the obligations of the existing defined-benefit plans (DBO) would amount to about 1.8 million euro. Likewise assuming a reduction of this rate of 50 bps, there would be an increase in the present value of the liabilities of about 1.9 million euro. Assuming a 50 bps increase in the in the rate of inflation compared to that actually applied to value the liabilities at 31 December 2022, all other actuarial assumptions being equal, the potential increase of the present value of the obligations of the existing defined-benefit plans (DBO) would amount to about 1.2 million euro. Likewise assuming a reduction of this rate of 50 bps, there would be a decrease in the present value of the liabilities of about 1.1 million euro. Changes in the remaining actuarial assumptions would not produce significant effects on the present value of the liabilities of the defined-benefit plans reported in the financial statement.", "dimensions": { "concept": "ifrs-full:DisclosureOfSensitivityAnalysisForActuarialAssumptionsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-472": { "value": "31 Provisions for risks and charges Opening balance Provisions Financial expenses Uses Other movements Changes in the scope of consolidation Closing balance 31 Dec 21 Provision third-party asset restoration 232.2 9.2 5.4 \u2010 (39.3) \u2010 207.5 Provision for closure and post- closure landfill expenses 179.0 5.6 13.2 (17.5) 2.3 \u2010 182.6 Provision for personnel legal cases and disputes 14.5 3.1 \u2010 (5.8) (1.1) \u2010 10.7 Provisions for waste disposal 6.7 7.2 \u2010 (6.4) \u2010 0.6 8.1 Provision for plants dismantling 5.9 \u2010 0.1 \u2010 \u2010 \u2010 6.0 Other provisions for risks and charges 99.9 28.0 \u2010 (1.5) (14.9) 1.6 113.1 Total 538.2 53.1 18.7 (31.2) (53.0) 2.2 528.0 31 Dec 22 Provision third-party asset restoration 207.5 6.3 4.1 \u2010 \u2010 \u2010 217.9 Provision for closure and post- closure landfill expenses 182.6 6.0 8.0 (13.5) 3.2 \u2010 186.3 Provision for personnel legal cases and disputes 10.7 2.4 \u2010 (1.3) (1.0) 0.1 10.9 Provisions for waste disposal 8.1 9.3 \u2010 (7.6) (0.1) \u2010 9.7 Provision for plants dismantling 6.0 \u2010 0.1 \u2010 \u2010 \u2010 6.1 Other provisions for risks and charges 113.1 44.0 \u2010 (5.6) (16.8) \u2010 134.7 Total 528.0 68.0 12.2 (28.0) (14.7) 0.1 565.6 The \u201cProvision for third-party asset restoration\u201d includes provisions made in relation to law and contractual requirements for the Group companies as lessees of the distribution networks of the entity that owns the assets. The allocations are made on the basis of depreciation rates held to be representative of the remaining useful life of the assets in question in order to compensate the owner companies for the wear and tear of the assets used for business activities. The provision reflects the present value of these outlays which will be determined in future periods (usually on expiry of the agreements entered into with the area agencies, as far as the water service is concerned, and on expiry of the transitory period anticipated by current legislation as far as gas distribution is concerned). The increases in the provision comprise the sum total of the provisions for the year, including those discounted to present value, and the financial charges for the period associated with the cash flows discounted to present value. The decrease in provisions compared to the previous year is mainly affected by the end of the extended management of the water service in the province of Rimini at 31 December 2021. The tender, which was also awarded to the Hera Group, stipulates that the assets are to remain under the management of the owner companies and are therefore not to be entrusted to the operator. The decrease in financial expenses compared to the previous period is determined by the annual update of the parameters used to reflect current market conditions (Wacc). The \u201cProvision for landfill closure and post-closure expenses\u201d represents the amount set aside to cover the costs which will have to be incurred for the management of the closure and post-closure period pertaining to the landfills currently managed. The future outlays, calculated for each landfill by means of a specific appraisal, have been discounted to present value. The increases in the provision comprise the financial component derived from the discounting process and provisions due to changes in the assumptions about future outlays, following the change in expert estimates on closed landfills. Financial expenses decreased compared to the previous year due to the different effects arising from the yearly update of the parameters used to reflect current market conditions (Wacc), as well as the revision of the assumptions on the timing of future disbursements. Uses represent actual disbursements that occurred during the year, while are \u201cOther movements\u201d mainly includes estimated closure and post- closure costs in relation to newly constructed landfills and the changes in the estimated closure and post- closure costs of active landfills, which entailed the recording of an adjustment of the same amount as the value of tangible assets (landfill asset), totalling 1.9 million euro for the year 2022. The \u201cProvision for legal cases and disputes brought by personnel\u201d reflects the outcomes of lawsuits and disputes brought by employees. \u201cProvision for plants dismantling\u201d includes the amounts allocated for the future dismantling of the plants for cases in which it is mandatory. \u201cProvision for waste disposal\u201d reports the estimated costs of disposal of the waste already stored at the Group\u2019s plants. The provisions reflect the estimated costs of contributions for the year 2022 not yet processed at the end of the financial period, while the uses represent the costs incurred over the period for the processing of waste that was residual as at 31 December 2021. \u201cOther provisions for risks and charges\u201d comprises provisions made against sundry risks. Below, there is a description of the main items: Liabilities Type Amount (mn \u20ac) The higher cost of the electricity used in the water service provision was not recognised, due to the volatility of the energy market, which resulted in price values for the period that were higher than the allowed maximum limit provided for by the tariff system. Likely 18.5 The amount of the WTE and cogeneration plants\u2019 green certificates, calculated according to the difference between auxiliary services resulting from total self- consumption and services estimated on the basis of the benchmark percentage, was not recognised; Likely 14.0 Outstanding bonds (guarantee on financial exposure given by AcegasApsAmga Spa) in case of abandonment of the operations run by the foreign subsidiary AresGas (Bulgaria). Contingent 11.3 Risks arising from the activity of energy efficiency upgrading of buildings carried out on behalf of end customers, particularly apartment blocks Likely 11.3 Reimbursement of a portion of the sewerage and purification tariffs for the water service Likely 6.1 Potentially higher expenses that may be incurred in connection with extraordinary maintenance on the Ponte San Nicol\u00f2 (Padua) landfill Contingent 5.2 Potential litigations arising from the risk of disputes in relation to the gas distribution unit of the Veneto and Friuli Venezia-Giulia regions, which was sold at the end of 2019 Likely 3.5 The liabilities classified as contingent were recognised as part of the business combination in the year in which it occurred. Provisions in this category, which amounted to 44 million euro, showed an increase compared to the previous year, mainly due to legislative and regulatory risks. The reduction of 16.8 million euro, classified as \u201cOther movements\u201d is mainly attributable to the following: release of provisions recorded in previous years, valued in excess of the actual liability, in the amount of 10.9 million euro. These refer, in the amount of 6.5 million euro, to the approval of applications submitted in relation to the full recognition of electricity costs incurred in the water service sector for the year 2021, the full remuneration of which will be guaranteed by means of the tariff in subsequent years; partial offsetting of the provision for risks set aside in previous years for the non-recognition of green certificates, in the amount of 4.7 million euro, with a similar amount of receivables recorded under current assets for certificates. The \u201cChange in the scope of consolidation\u201d include the provisions of the companies acquired during 2022. For detailed information on risk provisions for tax litigations, see note 12 \u201cTaxes\u201d. ", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherProvisionsContingentLiabilitiesAndContingentAssetsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-448": { "value": "32 Inventories 31 Dec 22 31 Dec 21 Change Gas stocks 468.6 58.9 409.7 Raw materials and stocks 57.6 50.5 7.1 Materials earmarked for sale and final products 19.5 6.7 12.8 Contract work in progress 449.4 251.9 197.5 Total 995.1 368.0 627.1 \u201cGas stocks\u201d includes methane gas stocks held by the Group at the end of the period, which during the 2023 financial period will be used to supply gas to its customers. Change from the previous year was due to: \u25aa the significant increase in wholesale raw material prices as compared to 2021, was most noticeable at the time of placing in storage. \u25aa higher volumes in stock at the end of the period, which increased by 85% compared to 31 December 2021. The book value of gas stocks is recoverable on the basis of gas sales made after the end of the financial period and forward sales contracts already signed by the Group at the date of the financial statements. \u201cRaw materials and stocks\u201d, already presented net of an associated obsolescence provision, mainly includes: 31 Dec 22 31 Dec 21 Change Spare materials and equipment 49.8 44.0 5.8 Plastic materials 7.4 6.5 0.9 Other fuels 0.4 \u2010 0.4 Total 57.6 50.5 7.1 \u201cMaterials earmarked for sale and finished products\u201d, already shown net of the relevant provision for depreciation, mainly consists of: 31 Dec 22 31 Dec 21 Change Plastic products 12.2 5.8 6.4 Material for photovoltaic systems 6.7 0.6 6.1 Telecommunications equipment 0.6 0.3 0.3 Total 19.5 6.7 12.8 The change for the period is due to both the significant increase in the prices of virgin polymer for the manufacture of plastic products and the increased volume of operations of the photovoltaic business. The item \u201cContract work in progress\u201d includes long-term contracts for plant construction work, mainly in relation to the following businesses: 31 Dec 22 31 Dec 21 Change Energy services 384.9 199.1 185.8 Water services 27.3 21.3 6.0 Public lighting 23.7 23.4 0.3 Other minor items 13.5 8.1 5.4 Total 449.4 251.9 197.5 The change in the period is mainly related to the energy requalification of apartment buildings, especially apartment buildings, a business that has strongly increased in 2022 partly thanks to the Group\u2019s strategic choices aimed at combating climate change.", "dimensions": { "concept": "ifrs-full:DisclosureOfInventoriesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-419": { "value": "33 Commercial receivables 31 Dec 22 31 Dec 21 Change Receivables from customers 2,051.1 1,842.9 208.2 Provision for bad debts (552.0) (444.6) (107.4) Receivables from customers for bills and invoices not yet issued 2,375.9 1,519.7 856.2 Total 3,875.0 2,918.0 957.0 Trade receivables comprise estimated consumption, for the portion pertaining to the period, relating to bills and invoices which will be issued after 31 December 2022, as well as receivables for revenues coming due during the period, referring to the water sector which will be billed in the following period, in accordance with the billing methods for final customers established by the relevant Authority. The increase from the previous year in the stock of receivables managed compared to the previous year was mainly due to: \u25aa the increase in the market prices of gas and electricity commodities, which led to a corresponding increase in the value of both sales to end customers and brokerage transactions in wholesale markets carried out at the end of the financial year and which will financially settle in early 2023; \u25aa the greater number of energy end-users served in the country following the allocation of the relevant supply tenders (as mentioned in sections 1.07.01 \u201cGas\u201d and 1.07.02 \u201cElectricity\u201d of the Directors\u2019 Report). The value of trade receivables reported in the financial statements at 31 December 2022 represents the Group\u2019s maximum exposure to credit risk. Changes in the provision for bad debts is as follows: Opening balance Provisions Changes in the scope of consolidation Uses and other movements Closing balance 2021 financial year 394.4 94.4 1.8 (46.0) 444. 6
2022 financial year
444.6
133.9
1.8
(28.3)
552.0
The recording of the provision is made on the basis of analytical valuations in relation to specific
receivables, supplemented by measurements made based on future-oriented analyses of the receivables
regarding the general body of customers (in relation to the age of the receivables, the type of recovery
action undertaken and the status of the debtor), as described in the section \u201cRisk management\u201d in
paragraph 2.02.01 \u201cIntroduction\u201d. The change in the provision with respect to the previous year is mainly
due to the markets of last resort, which experienced a significant increase in the number of customers
and consequently in the volumes managed, in a scenario also characterised by high prices, which further
increased the nominal value of the receivables managed. For traditional energy markets, the provision
for the year 2022 was in line with the previous year, as the increase in exposure due to higher prices
was more than offset by improved collection performance. In fact, the 24-month unpaid ratio of the
Group\u2019s sales companies, calculated net of the markets of last resort for gas, decreased to 0.71%,
compared to 0.85% in the previous year. Confirming the continuous trend of improvement over the last
few years, the use of the provision fell sharply compared to the previous year.
The following table displays receivables for invoices issued relative to all customer clusters, organized
by degree of past-due:
31 Dec 22
Inc.%
31 Dec 21
Inc.%
Change
Not yet due
824.2
40%
772.3
42%
51.9
Due 0-30 days
179.5
9%
214.5
12%
(35.0)
Due 31-180 days
287.3
14%
145.0
8%
142.3
Due 181-360 days
151.2
7%
98.8
5%
52.4
Due beyond 360 days
608.9
30%
612.3
33%
(3.4)
Total
2,051.1
1,842.9
208.2
Analysis of
overdue
receivables
", "dimensions": { "concept": "ifrs-full:DisclosureOfTradeAndOtherReceivablesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-63": { "value": "The value of trade receivables reported in the financial statements at 31 December 2022 represents the Group\u2019s maximum exposure to credit risk. Changes in the provision for bad debts is as follows: Opening balance Provisions Changes in the scope of consolidation Uses and other movements Closing balance 2021 financial year 394.4 94.4 1.8 (46.0) 444. 2022 financial year 444.6 133.9 1.8 (28.3) 552.0 The recording of the provision is made on the basis of analytical valuations in relation to specific receivables, supplemented by measurements made based on future-oriented analyses of the receivables regarding the general body of customers (in relation to the age of the receivables, the type of recovery action undertaken and the status of the debtor), as described in the section \u201cRisk management\u201d in paragraph 2.02.01 \u201cIntroduction\u201d. The change in the provision with respect to the previous year is mainly due to the markets of last resort, which experienced a significant increase in the number of customers and consequently in the volumes managed, in a scenario also characterised by high prices, which further increased the nominal value of the receivables managed. For traditional energy markets, the provision for the year 2022 was in line with the previous year, as the increase in exposure due to higher prices was more than offset by improved collection performance. In fact, the 24-month unpaid ratio of the Group\u2019s sales companies, calculated net of the markets of last resort for gas, decreased to 0.71%, compared to 0.85% in the previous year. Confirming the continuous trend of improvement over the last few years, the use of the provision fell sharply compared to the previous year.", "dimensions": { "concept": "ifrs-full:DisclosureOfAllowanceForCreditLossesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-440": { "value": "
34 Commercial payables
31 Dec 22
31 Dec 21
Change
Payables to suppliers
890.3
741.2
149.1
Payables to suppliers for invoices not yet received
2,202.8
1,615.4
587.4
Total
3,093.1
2,356.6
736.5
The change of commercial payables compared to the previous year is mainly due to:
\u25aa the increase of gas and electricity wholesale prices, which led to an increase in the purchase costs
of raw materials with a resulting higher liability towards suppliers;
\u25aa the increase in the volume of energy efficiency upgrading of buildings carried out on behalf of end
customers, particularly apartment buildings, which led to a subsequent increase in payables to
suppliers and professionals carrying out the works.
", "dimensions": { "concept": "ifrs-full:DisclosureOfTradeAndOtherPayablesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-491": { "value": "35 Other current assets 31 Dec 22 31 Dec 21 Change Fund for energy and waste management services for equalisation and continuity income 119.6 49.9 69.7 VAT, excise and additional taxes 86.6 47.6 39.0 Tax credits and benefits 79.8 20.2 59.6 Receivables from electricity and gas sector companies 76.1 \u2010 76.1 Advances to suppliers 76.1 42.7 33.4 Security deposits 59.8 121.0 (61.2) Energy efficiency bonds and emissions trading 40.9 46.9 (6.0) Pre-paid costs 29.5 26.5 3.0 Incentives from renewable sources 10.6 23.4 (12.8) Other receivables 63.5 44.1 19.4 Total 642.5 422.3 220.2 \u201cFund for energy and waste management services for equalisation and continuity income\u201d comprises 36.3 million euro of equalisation credit (27.7 million euro at 31 December 2021) and 83.3 million euro of continuity income (22.2 million euro at 31 December 2021). Continuity income increased by 61.1 million euro compared to the previous year mainly due to two effects: \u25aa on the one hand, the measures introduced by the government in autumn 2021, aimed at containing energy tariffs, provided for both the cancellation of most system charges and the extension of social gas and electricity bonuses. The application of these tariff reduction measures (as indicated in the regulatory context in paragraph 1.01.01 of the Directors\u2019 Report), which were not imposed on market operators, resulted in a significant receivable from the Fund for energy and waste management services. This credit exposure, which increased sharply compared to the previous year, was subject to operations to optimise collection times, but still generated a net increase of 28.5 million euro; \u25aa on the other hand, the recognition on the basis of Resolution 44/2022 issued by ARERA for the costs incurred for default gas and last resort supply services for the year 2022 resulted in a change of 27 million euro compared to the previous year, bringing the value of the receivable to be collected for the recognition of costs incurred for operating on these markets to a total of 34.5 million euro at 31 December 2022. Equalisation credit increased by 8.6 million euro compared to the previous year, with a diversified dynamic in the various regulated sectors, particularly as a result of the trend in volumes distributed in the gas business. \u201cVAT, excise and additional taxes\u201d includes payables for VAT in the amount of 18 million euro (6.1 million euros at 31 December 2021), and excise and additional taxes in the amount of 68.6 million euro (41.5 million euro at 31 December 2021). With regard to excise duties and additional taxes, the procedures governing the financial relations with the tax authorities should be taken into account: as a matter of fact, advance payments made during the year are calculated on the basis of the quantities of gas and electricity billed in the previous year, while the actual debt is generated on the basis of the volumes sold in the period. These methods can generate credit or debit positions with differences that may be significant even between one period and another. The change as compared to 31 December 2021 is attributable to a decrease of 11.9 million euro in receivables for value added tax and an increase of 27.1 million euro in receivables for excise and additional taxes. For a better understanding of the Group\u2019s net exposure to value added tax, please refer to the commentary in Note 36 \u201cOther current liabilities\u201d. The increase in receivables for excise duties and additional taxes, on the other hand, is mainly due to the lower volumes of gas sold in the 2022 financial year compared to the previous period to customers on the free and safeguarded market in the north- eastern area, due to the milder climate and energy-saving behaviour adopted by users to cope with the high cost of energy. \u201cTax credits and benefits\u201d mainly include: \u25aa tax credits arising from the application of the invoice discount to end customers, stated at their market value, in relation to subsidised energy efficiency measures, amounting to 44.1 million euro. These measures are mainly related to building renovation activities on apartment buildings; \u25aa credits arising from the Government\u2019s regulatory measures in relation to electricity and gas costs for electricity and gas-consuming companies, which will be used as offsets in the 2023 financial year, as provided for by current tax regulations, amounting to approximately 23 million euro; \u25aa credits for investments in capital goods, including those related to Industry 4.0, totalling 5.8 million euro, which will be used to offset taxes and contributions in subsequent years on the basis of the annual limits provided for. \u201cReceivables from electricity and gas sector companies\u201d mainly include receivables from the distribution companies As a result of the same dynamics set forth above in the commentary on continuity income, these positions were generated especially at 31 December 2022 as a result of the crediting to end customers, carried out by the distribution companies through the sales companies, of the social bonuses envisaged by the measures introduced by the Government as from autumn 2021 (subsequently enhanced both in terms of value and beneficiary population) and of the Ug2c component, which is negative, introduced since 1 April 2022. For these reasons, the value of the credited items exceeded the debiting of the distribution fees, resulting in a reversal of the typical commercial balance. In the item \u201cAdvances to suppliers\u201d, the increase compared to the previous year is mainly due to the increase in the volume of energy efficiency work in buildings on behalf of customers, mainly apartment blocks, and the subsequent requests from the Group\u2019s partner suppliers in carrying out the work. \u201cSecurity deposits\u201d mainly includes deposits provided as security for participation in foreign platforms that deal in commodity contracts, auctions on the electricity market, and to secure transactions on wholesale markets for electricity and natural gas, totalling 49.3 million euro; The decrease compared to the previous year is due to lower operations carried out in the period, especially on the Eex platform, as a result of the Group\u2019s decision to shift to other forms of exchange contracts, also due to the volatility of commodity prices. \u201cEnergy efficiency bonds and emissions trading\u201d, includes the following: 31 Dec 22 31 Dec 21 Change Grey certificate. 20.8 14.4 6.4 White certificates 15.0 22.7 (7.7) Green certificates 5.1 9.8 (4.7) Total 40.9 46.9 (6.0) The portfolio of grey certificates reflects the valuation of both securities held by the Group for 10.1 million euro (7.4 million euro at 31 December 2021) and the exposure for forward contracts to buy and sell greenhouse gas emission allowances for 10.7 million euro (7 million euro at 31 December 2021). The increase as compared to 2021 is mainly due to a volume effect, the market price being substantially in line with the previous period. \u25aa The portfolio of white certificates includes the valuation of both securities calculated on the basis of the energy efficiency targets set by the GSE for gas and electricity distribution companies, net of disposals that occurred in the period, for 13.1 million euro (20.8 million euro at 31 December 2021), and securities originating from energy efficiency measures implemented by the Group for 1.9 million euro (in line with the previous year). The decrease, with substantially the same valuation of the contribution compared to the previous year and with higher allocated targets for the obligation year 2022 compared to the obligation year 2021, is mainly due to both different ways of fulfilling obligations highlighted in the 2022 financial year and to the higher quantity of disposals. \u25aa At 31 December 2022, the green certificate portfolio included securities recognised on an accrual basis prior to 2016 in relation to the electricity production of the waste-to-energy plant in Ferrara. These securities are the subject of a complaint by the GSE concerning the methodology for calculating the self-consumption of auxiliary services. In the course of 2022, positions amounting to 4.7 million euro concerning other plants affected by a similar calculation method were closed, as they were deemed to be definitively non-collectable. For the partial closure of the portfolio, the relevant risk provision, which had already been set aside in previous years, was compensated by an equal amount, as explained in Note 31 \u201cProvisions for risks and charges\u201d. \u201cPrepaid costs\u201d mainly comprise future accruals in respect of: 31 Dec 22 31 Dec 21 Change Outsourced services and processing 14.6 13.7 0.9 Insurance, bank sureties and commissions 5.0 4.3 0.7 Rents payables and concession fees for network services 2.7 2.3 0.4 Other minor items 7.2 6.2 1.0 Total 29.5 26.5 3.0 \u201cIncentives from renewable sources\u201d consists of receivables from the GSE for the new incentive mechanism to promote the production of electricity from renewable sources. Incentives for the period decreased sharply compared to the 2021 financial year, as the price of incentives (Grin) was reduced, which is inversely proportional to the previous year\u2019s national electricity price (Pun). The item \u201cOther receivables\u201d includes: 31 Dec 22 31 Dec 21 Change Extraordinary contributions 22.6 \u2010 22.6 Water leakage provision receivables 6.2 10.6 (4.4) Receivables from asset companies 6.0 5.7 0.3 Other minor items 28.7 27.8 0.9 Total 63.5 44.1 19.4 \u25aa Extraordinary subsidies include the amount certain Group companies paid, yet deemed not due, during the year 2022 in respect of the \u201cExtraordinary extra-profits subsidy\u201d, established for the year 2022 by Article 37 of Legislative Decree no. 21/2022. These amounts were paid to the State Treasury on the due dates, despite significant doubts as to their application, in order to avoid penalties and interest. The subsequent 2023 Budget Law, which in paragraphs 120 and 121 of Article 1 changed the subjective scope and the taxable base of the contribution for the year 2022, made it possible to exclude one Group company from the scope of application, however failed to clear the application doubts in respect of a second impacted company. In both cases, the Group filed for reimbursement, thus recording the amount paid under other current assets; \u25aa receivables for water leakage provisions includes amounts charged and not yet collected from users for insurance in case of leaks; \u25aa Receivables from asset companies include receivables from companies that own the networks and from related assets used by the Group to provide utility services.", "dimensions": { "concept": "ifrs-full:DisclosureOfPrepaymentsAndOtherAssetsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-473": { "value": "35 Other current assets 31 Dec 22 31 Dec 21 Change Fund for energy and waste management services for equalisation and continuity income 119.6 49.9 69.7 VAT, excise and additional taxes 86.6 47.6 39.0 Tax credits and benefits 79.8 20.2 59.6 Receivables from electricity and gas sector companies 76.1 \u2010 76.1 Advances to suppliers 76.1 42.7 33.4 Security deposits 59.8 121.0 (61.2) Energy efficiency bonds and emissions trading 40.9 46.9 (6.0) Pre-paid costs 29.5 26.5 3.0 Incentives from renewable sources 10.6 23.4 (12.8) Other receivables 63.5 44.1 19.4 Total 642.5 422.3 220.2 \u201cFund for energy and waste management services for equalisation and continuity income\u201d comprises 36.3 million euro of equalisation credit (27.7 million euro at 31 December 2021) and 83.3 million euro of continuity income (22.2 million euro at 31 December 2021). Continuity income increased by 61.1 million euro compared to the previous year mainly due to two effects: \u25aa on the one hand, the measures introduced by the government in autumn 2021, aimed at containing energy tariffs, provided for both the cancellation of most system charges and the extension of social gas and electricity bonuses. The application of these tariff reduction measures (as indicated in the regulatory context in paragraph 1.01.01 of the Directors\u2019 Report), which were not imposed on market operators, resulted in a significant receivable from the Fund for energy and waste management services. This credit exposure, which increased sharply compared to the previous year, was subject to operations to optimise collection times, but still generated a net increase of 28.5 million euro; \u25aa on the other hand, the recognition on the basis of Resolution 44/2022 issued by ARERA for the costs incurred for default gas and last resort supply services for the year 2022 resulted in a change of 27 million euro compared to the previous year, bringing the value of the receivable to be collected for the recognition of costs incurred for operating on these markets to a total of 34.5 million euro at 31 December 2022. Equalisation credit increased by 8.6 million euro compared to the previous year, with a diversified dynamic in the various regulated sectors, particularly as a result of the trend in volumes distributed in the gas business. \u201cVAT, excise and additional taxes\u201d includes payables for VAT in the amount of 18 million euro (6.1 million euros at 31 December 2021), and excise and additional taxes in the amount of 68.6 million euro (41.5 million euro at 31 December 2021). With regard to excise duties and additional taxes, the procedures governing the financial relations with the tax authorities should be taken into account: as a matter of fact, advance payments made during the year are calculated on the basis of the quantities of gas and electricity billed in the previous year, while the actual debt is generated on the basis of the volumes sold in the period. These methods can generate credit or debit positions with differences that may be significant even between one period and another. The change as compared to 31 December 2021 is attributable to a decrease of 11.9 million euro in receivables for value added tax and an increase of 27.1 million euro in receivables for excise and additional taxes. For a better understanding of the Group\u2019s net exposure to value added tax, please refer to the commentary in Note 36 \u201cOther current liabilities\u201d. The increase in receivables for excise duties and additional taxes, on the other hand, is mainly due to the lower volumes of gas sold in the 2022 financial year compared to the previous period to customers on the free and safeguarded market in the north- eastern area, due to the milder climate and energy-saving behaviour adopted by users to cope with the high cost of energy. \u201cTax credits and benefits\u201d mainly include: \u25aa tax credits arising from the application of the invoice discount to end customers, stated at their market value, in relation to subsidised energy efficiency measures, amounting to 44.1 million euro. These measures are mainly related to building renovation activities on apartment buildings; \u25aa credits arising from the Government\u2019s regulatory measures in relation to electricity and gas costs for electricity and gas-consuming companies, which will be used as offsets in the 2023 financial year, as provided for by current tax regulations, amounting to approximately 23 million euro; \u25aa credits for investments in capital goods, including those related to Industry 4.0, totalling 5.8 million euro, which will be used to offset taxes and contributions in subsequent years on the basis of the annual limits provided for. \u201cReceivables from electricity and gas sector companies\u201d mainly include receivables from the distribution companies As a result of the same dynamics set forth above in the commentary on continuity income, these positions were generated especially at 31 December 2022 as a result of the crediting to end customers, carried out by the distribution companies through the sales companies, of the social bonuses envisaged by the measures introduced by the Government as from autumn 2021 (subsequently enhanced both in terms of value and beneficiary population) and of the Ug2c component, which is negative, introduced since 1 April 2022. For these reasons, the value of the credited items exceeded the debiting of the distribution fees, resulting in a reversal of the typical commercial balance. In the item \u201cAdvances to suppliers\u201d, the increase compared to the previous year is mainly due to the increase in the volume of energy efficiency work in buildings on behalf of customers, mainly apartment blocks, and the subsequent requests from the Group\u2019s partner suppliers in carrying out the work. \u201cSecurity deposits\u201d mainly includes deposits provided as security for participation in foreign platforms that deal in commodity contracts, auctions on the electricity market, and to secure transactions on wholesale markets for electricity and natural gas, totalling 49.3 million euro; The decrease compared to the previous year is due to lower operations carried out in the period, especially on the Eex platform, as a result of the Group\u2019s decision to shift to other forms of exchange contracts, also due to the volatility of commodity prices. \u201cEnergy efficiency bonds and emissions trading\u201d, includes the following: 31 Dec 22 31 Dec 21 Change Grey certificate. 20.8 14.4 6.4 White certificates 15.0 22.7 (7.7) Green certificates 5.1 9.8 (4.7) Total 40.9 46.9 (6.0) The portfolio of grey certificates reflects the valuation of both securities held by the Group for 10.1 million euro (7.4 million euro at 31 December 2021) and the exposure for forward contracts to buy and sell greenhouse gas emission allowances for 10.7 million euro (7 million euro at 31 December 2021). The increase as compared to 2021 is mainly due to a volume effect, the market price being substantially in line with the previous period. \u25aa The portfolio of white certificates includes the valuation of both securities calculated on the basis of the energy efficiency targets set by the GSE for gas and electricity distribution companies, net of disposals that occurred in the period, for 13.1 million euro (20.8 million euro at 31 December 2021), and securities originating from energy efficiency measures implemented by the Group for 1.9 million euro (in line with the previous year). The decrease, with substantially the same valuation of the contribution compared to the previous year and with higher allocated targets for the obligation year 2022 compared to the obligation year 2021, is mainly due to both different ways of fulfilling obligations highlighted in the 2022 financial year and to the higher quantity of disposals. \u25aa At 31 December 2022, the green certificate portfolio included securities recognised on an accrual basis prior to 2016 in relation to the electricity production of the waste-to-energy plant in Ferrara. These securities are the subject of a complaint by the GSE concerning the methodology for calculating the self-consumption of auxiliary services. In the course of 2022, positions amounting to 4.7 million euro concerning other plants affected by a similar calculation method were closed, as they were deemed to be definitively non-collectable. For the partial closure of the portfolio, the relevant risk provision, which had already been set aside in previous years, was compensated by an equal amount, as explained in Note 31 \u201cProvisions for risks and charges\u201d. \u201cPrepaid costs\u201d mainly comprise future accruals in respect of: 31 Dec 22 31 Dec 21 Change Outsourced services and processing 14.6 13.7 0.9 Insurance, bank sureties and commissions 5.0 4.3 0.7 Rents payables and concession fees for network services 2.7 2.3 0.4 Other minor items 7.2 6.2 1.0 Total 29.5 26.5 3.0 \u201cIncentives from renewable sources\u201d consists of receivables from the GSE for the new incentive mechanism to promote the production of electricity from renewable sources. Incentives for the period decreased sharply compared to the 2021 financial year, as the price of incentives (Grin) was reduced, which is inversely proportional to the previous year\u2019s national electricity price (Pun). The item \u201cOther receivables\u201d includes: 31 Dec 22 31 Dec 21 Change Extraordinary contributions 22.6 \u2010 22.6 Water leakage provision receivables 6.2 10.6 (4.4) Receivables from asset companies 6.0 5.7 0.3 Other minor items 28.7 27.8 0.9 Total 63.5 44.1 19.4 \u25aa Extraordinary subsidies include the amount certain Group companies paid, yet deemed not due, during the year 2022 in respect of the \u201cExtraordinary extra-profits subsidy\u201d, established for the year 2022 by Article 37 of Legislative Decree no. 21/2022. These amounts were paid to the State Treasury on the due dates, despite significant doubts as to their application, in order to avoid penalties and interest. The subsequent 2023 Budget Law, which in paragraphs 120 and 121 of Article 1 changed the subjective scope and the taxable base of the contribution for the year 2022, made it possible to exclude one Group company from the scope of application, however failed to clear the application doubts in respect of a second impacted company. In both cases, the Group filed for reimbursement, thus recording the amount paid under other current assets; \u25aa receivables for water leakage provisions includes amounts charged and not yet collected from users for insurance in case of leaks; \u25aa Receivables from asset companies include receivables from companies that own the networks and from related assets used by the Group to provide utility services.", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherCurrentAssetsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-505": { "value": "36 Other current liabilities 31 Dec 22 31 Dec 21 Change Payables for advances to the fund for energy and waste management services 441.8 336.9 104.9 Security deposits from customers 383.3 129.8 253.5 Plant investment grants 239.5 228.7 10.8 Advances for works 106.7 50.4 56.3 Fund for energy and waste management service components and equalisation 99.5 85.8 13.7 VAT, excise and additional taxes 83.0 155.0 (72.0) Personnel and employee withholding 82.8 81.7 1.1 Payables to social security institutions 69.4 63.6 5.8 Energy efficiency bonds and emissions trading liabilities 51.6 49.2 2.4 Receivables from electricity and gas sector companies 34.7 \u2010 34.7 Prepaid revenues and other expenses 32.4 167.6 (135.2) Other payables 95.3 86.9 8.4 Total 1,720.0 1,435.6 284.4 \u201cPayables for advances to the Fund for energy and waste management services\u201d comprises non-interest- bearing advances granted by the Fund for energy and waste management services, as follows: \u25aa 243.3 million euro (233.4 million euro at 31 December 2021) for advances in compliance with the integration mechanism set forth by resolution 370/2012/R/Eel and 456/2013/R/Eel by ARERA, for overdue and unpaid receivables from customers managed under a safeguard regime. The latest reports concern the years 2009-2020; \u25aa 182.2 million euro (90 million euro at 31 December 2021) in compliance with the integration mechanism set forth in Law 239 of 23 August 2004 and by ARERA\u2019s Tivg , for the charges for delinquency of services of last resort in the natural gas sector (Fui, Ftf and Fdd) until the 2019-2021 thermic years; \u25aa 12.9 million (11.8 million euro at 31 December 2021) in compliance with Resolution 32/2021/R/Eel (former Resolution 445/2020/R/Eel), relating to the procedures for accessing the reimbursement mechanism for general system charges not collected from end customers and already paid to distribution companies for 2016-2020. The scope is restricted to the sale of electricity on the free market, the Safeguard market (disconnectable) and the gradual protection service (disconnectable). \u201cSecurity deposits from customers\u201d reflect the amounts requested from customers for gas, water and electricity provision contracts. The significant increase for the period is mainly due to: \u25aa the award of six lots of the gas last resort service and a further nine lots of the gas distribution default service for the period 1 October 2021 - 30 September 2023; \u25aa the award of four lots of the Consip EE19 tender for the supply of electricity to public administrations in 2022; \u25aa the increase in commodity prices that occurred during the period, which was reflected in a higher value of security deposits charged to customers. \u201cPlant investment grants\u201d decreases in proportion to the amount of depreciation calculated on the fixed assets in question and increases as a result of new investments subject to grants. The item includes specifically, the following grants received by the Group: 31 Dec 22 31 Dec 21 Change New water system investment fund; 87.1 73.0 14.1 Purification plant in Servola (Trieste) 33.0 36.0 (3.0) Purification and sewarage systems 32.0 33.2 (1.2) Construction of rolling basins e underwater pipes in the area of Rimini. 20.6 21.5 (0.9) Other minor items 66.8 65.0 1.8 Total 239.5 228.7 10.8 \u201cAdvances for works\u201d includes advances received from municipalities and apartment buildings for works in progress relating to public lighting and energy efficiency upgrades of private buildings, respectively, which will be completed in the following years. The significant increase is in line with the increase in energy efficiency work carried out by the Group, as reported in Note 1 \u201cRevenues\u201d. \u201cFund for energy and waste management service components and equalisation\u201d, reflects the liabilities for the Fund for energy and waste management services mainly due to some system components of the gas, water and electricity service for 84.1 million euro (84.8 million euro at 31 December 2021) and equalization of the electricity service for 15.4 million euro (1 million euro at 31 December 2021). \u201cVAT, excise and additional taxes\u201d includes payables for VAT in the amount of 0.9 million euro (78.9 million euro at 31 December 2021), and excise and additional taxes in the amount of 82.1 million euro (76.1 million euro at 31 December 2021). As outlined in Note 35, \u201cOther current assets\u201d, this increase must be understood taking into account the factors that regulate financial relations with the Inland Revenue Office, which can generate credit/debit positions with differences that can be significant even between one financial period and another. With regard to value-added tax, the decrease in the year was mainly related to the payment of the advance concerning the Group VAT for 90.3 million euro at the end of the financial period, which resulted in a credit balance as at 31 December, whereas last year, in application of the historical method, the advance had not been paid. The payment of the advance depended on the dynamics of the turnover issued, in particular relating to the greater volumes on the markets for last resort gas services and the trend in energy commodity prices, which increased the taxable base, even in the presence of a reduction in the rate to 5% for the supply of methane gas for residential and industrial use, which only partially mitigated the volumetric effect. With regard to excise and additional taxes, the advance payment in 2022 was made, as required by the regulations in force, on the basis of the volumes invoiced in the previous year. However, the accrued liability was generated on the basis of the volumes invoiced in the year 2022 which were higher than in the year 2021. \u201cPersonnel and employee withholding\u201d includes for the most part the vacation time accrued and not used, as well as the productivity bonuses accounted for by department, plus withholding taxes to be paid to the State treasury as tax substitute for employees. \u201cPayables to social security institutions\u201d relates to contributions owed to these institutions for the December salaries, performance bonuses and additional monthly payments under national collective agreements. \u201cEnergy efficiency bonds and emissions trading\u201d, includes: 31 Dec 22 31 Dec 21 Change Grey certificate. 22.5 17.2 5.3 White certificates 17.9 26.7 (8.8) Guarantee of origin certificates 11.2 5.3 5.9 Total 51.6 49.2 2.4 Grey certificates reflect the valuation of both the forward sale and purchase contracts of greenhouse gas emission allowances in the amount of 11.8 million euro (6.6 euro million at 31 December 2021) and the obligation to redeliver certificates calculated on the basis of current regulations in the amount of 10.7 million euro(10.6 million euro at 31 December 2021). The change compared to the previous year is due to higher volumes of forward contracts, while market prices were largely unchanged. White certificates include, beginning in the 2021 financial year, the valuation of exposure with respect to obligations to return energy efficiency certificates not yet in the portfolio to the relevant authorities. The change as compared to 31 December 2021 is mainly due to the decrease in certificates not yet cancelled in respect of the years for which the Group has not yet fully complied with the allocated accrual obligation. Guarantee of origin (GO) certificates concern certification obligations for electricity produced from renewable energy sources for sales made to customers with this type of supply. The increase in the liability is due to the increase in the market price over the course of 2022. \u201cReceivables from electricity and gas sector companies\u201d mainly include receivables entered by the Group\u2019s distribution companies against third-party sales companies These positions were generated at 31 December 2022 as a result of the measures against high energy prices, as illustrated in Note 35 \u201cOther current assets\u201d in the item \u201cReceivables from electricity and gas companies\u201d. The item \u201cAnticipated revenues and other expenses\u201d comprises portions of revenues already invoiced falling due in the following financial period. The item specifically comprises for 9 million euro (146.8 million euro at 31 December 2021) invoices issued at the end of 2021 for energy efficiency operations benefiting from tax incentives for which the work will be completed in the 2023 financial year. The item \u201cother payables\u201d mainly comprises the following: 31 Dec 22 31 Dec 21 Change Tariff concessions to users 11.5 12.8 (1.3) Environmental damage contributions 11.3 11.4 (0.1) Insurance deductibles 9.8 12.2 (2.4) Delinquency payments for electricity gas and other sectors 9.5 5.9 3.6 Other minor items 53.2 44.6 8.6 Total 95.3 86.9 8.4 Specifically: \u25aa environmental damage contributions represent the payments to be made to municipalities, on the basis of specific agreements, as compensation for activities that impact on the environment for waste delivered to plants in their municipal territories. The amount of these contributions is related to the amount of waste disposed of annually; \u25aa insurance deductibles include amounts that the Group must repay directly to damaged third parties or insurance companies; \u25aa delinquency payables in the electricity, gas and other sectors mainly represent the amounts, charged to end users, to be retroceded as compensation to previous suppliers who were in arrears for the last three monthly payments, prior to their transition to the Hera Group. This indemnity is applied only to certain specific categories of users, identified by ARERA Resolution no. 593/2017/R and its subsequent amendments and additions. ", "dimensions": { "concept": "ifrs-full:DisclosureOfAccruedExpensesAndOtherLiabilitiesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-492": { "value": "36 Other current liabilities 31 Dec 22 31 Dec 21 Change Payables for advances to the fund for energy and waste management services 441.8 336.9 104.9 Security deposits from customers 383.3 129.8 253.5 Plant investment grants 239.5 228.7 10.8 Advances for works 106.7 50.4 56.3 Fund for energy and waste management service components and equalisation 99.5 85.8 13.7 VAT, excise and additional taxes 83.0 155.0 (72.0) Personnel and employee withholding 82.8 81.7 1.1 Payables to social security institutions 69.4 63.6 5.8 Energy efficiency bonds and emissions trading liabilities 51.6 49.2 2.4 Receivables from electricity and gas sector companies 34.7 \u2010 34.7 Prepaid revenues and other expenses 32.4 167.6 (135.2) Other payables 95.3 86.9 8.4 Total 1,720.0 1,435.6 284.4 \u201cPayables for advances to the Fund for energy and waste management services\u201d comprises non-interest- bearing advances granted by the Fund for energy and waste management services, as follows: \u25aa 243.3 million euro (233.4 million euro at 31 December 2021) for advances in compliance with the integration mechanism set forth by resolution 370/2012/R/Eel and 456/2013/R/Eel by ARERA, for overdue and unpaid receivables from customers managed under a safeguard regime. The latest reports concern the years 2009-2020; \u25aa 182.2 million euro (90 million euro at 31 December 2021) in compliance with the integration mechanism set forth in Law 239 of 23 August 2004 and by ARERA\u2019s Tivg , for the charges for delinquency of services of last resort in the natural gas sector (Fui, Ftf and Fdd) until the 2019-2021 thermic years; \u25aa 12.9 million (11.8 million euro at 31 December 2021) in compliance with Resolution 32/2021/R/Eel (former Resolution 445/2020/R/Eel), relating to the procedures for accessing the reimbursement mechanism for general system charges not collected from end customers and already paid to distribution companies for 2016-2020. The scope is restricted to the sale of electricity on the free market, the Safeguard market (disconnectable) and the gradual protection service (disconnectable). \u201cSecurity deposits from customers\u201d reflect the amounts requested from customers for gas, water and electricity provision contracts. The significant increase for the period is mainly due to: \u25aa the award of six lots of the gas last resort service and a further nine lots of the gas distribution default service for the period 1 October 2021 - 30 September 2023; \u25aa the award of four lots of the Consip EE19 tender for the supply of electricity to public administrations in 2022; \u25aa the increase in commodity prices that occurred during the period, which was reflected in a higher value of security deposits charged to customers. \u201cPlant investment grants\u201d decreases in proportion to the amount of depreciation calculated on the fixed assets in question and increases as a result of new investments subject to grants. The item includes specifically, the following grants received by the Group: 31 Dec 22 31 Dec 21 Change New water system investment fund; 87.1 73.0 14.1 Purification plant in Servola (Trieste) 33.0 36.0 (3.0) Purification and sewarage systems 32.0 33.2 (1.2) Construction of rolling basins e underwater pipes in the area of Rimini. 20.6 21.5 (0.9) Other minor items 66.8 65.0 1.8 Total 239.5 228.7 10.8 \u201cAdvances for works\u201d includes advances received from municipalities and apartment buildings for works in progress relating to public lighting and energy efficiency upgrades of private buildings, respectively, which will be completed in the following years. The significant increase is in line with the increase in energy efficiency work carried out by the Group, as reported in Note 1 \u201cRevenues\u201d. \u201cFund for energy and waste management service components and equalisation\u201d, reflects the liabilities for the Fund for energy and waste management services mainly due to some system components of the gas, water and electricity service for 84.1 million euro (84.8 million euro at 31 December 2021) and equalization of the electricity service for 15.4 million euro (1 million euro at 31 December 2021). \u201cVAT, excise and additional taxes\u201d includes payables for VAT in the amount of 0.9 million euro (78.9 million euro at 31 December 2021), and excise and additional taxes in the amount of 82.1 million euro (76.1 million euro at 31 December 2021). As outlined in Note 35, \u201cOther current assets\u201d, this increase must be understood taking into account the factors that regulate financial relations with the Inland Revenue Office, which can generate credit/debit positions with differences that can be significant even between one financial period and another. With regard to value-added tax, the decrease in the year was mainly related to the payment of the advance concerning the Group VAT for 90.3 million euro at the end of the financial period, which resulted in a credit balance as at 31 December, whereas last year, in application of the historical method, the advance had not been paid. The payment of the advance depended on the dynamics of the turnover issued, in particular relating to the greater volumes on the markets for last resort gas services and the trend in energy commodity prices, which increased the taxable base, even in the presence of a reduction in the rate to 5% for the supply of methane gas for residential and industrial use, which only partially mitigated the volumetric effect. With regard to excise and additional taxes, the advance payment in 2022 was made, as required by the regulations in force, on the basis of the volumes invoiced in the previous year. However, the accrued liability was generated on the basis of the volumes invoiced in the year 2022 which were higher than in the year 2021. \u201cPersonnel and employee withholding\u201d includes for the most part the vacation time accrued and not used, as well as the productivity bonuses accounted for by department, plus withholding taxes to be paid to the State treasury as tax substitute for employees. \u201cPayables to social security institutions\u201d relates to contributions owed to these institutions for the December salaries, performance bonuses and additional monthly payments under national collective agreements. \u201cEnergy efficiency bonds and emissions trading\u201d, includes: 31 Dec 22 31 Dec 21 Change Grey certificate. 22.5 17.2 5.3 White certificates 17.9 26.7 (8.8) Guarantee of origin certificates 11.2 5.3 5.9 Total 51.6 49.2 2.4 Grey certificates reflect the valuation of both the forward sale and purchase contracts of greenhouse gas emission allowances in the amount of 11.8 million euro (6.6 euro million at 31 December 2021) and the obligation to redeliver certificates calculated on the basis of current regulations in the amount of 10.7 million euro(10.6 million euro at 31 December 2021). The change compared to the previous year is due to higher volumes of forward contracts, while market prices were largely unchanged. White certificates include, beginning in the 2021 financial year, the valuation of exposure with respect to obligations to return energy efficiency certificates not yet in the portfolio to the relevant authorities. The change as compared to 31 December 2021 is mainly due to the decrease in certificates not yet cancelled in respect of the years for which the Group has not yet fully complied with the allocated accrual obligation. Guarantee of origin (GO) certificates concern certification obligations for electricity produced from renewable energy sources for sales made to customers with this type of supply. The increase in the liability is due to the increase in the market price over the course of 2022. \u201cReceivables from electricity and gas sector companies\u201d mainly include receivables entered by the Group\u2019s distribution companies against third-party sales companies These positions were generated at 31 December 2022 as a result of the measures against high energy prices, as illustrated in Note 35 \u201cOther current assets\u201d in the item \u201cReceivables from electricity and gas companies\u201d. The item \u201cAnticipated revenues and other expenses\u201d comprises portions of revenues already invoiced falling due in the following financial period. The item specifically comprises for 9 million euro (146.8 million euro at 31 December 2021) invoices issued at the end of 2021 for energy efficiency operations benefiting from tax incentives for which the work will be completed in the 2023 financial year. The item \u201cother payables\u201d mainly comprises the following: 31 Dec 22 31 Dec 21 Change Tariff concessions to users 11.5 12.8 (1.3) Environmental damage contributions 11.3 11.4 (0.1) Insurance deductibles 9.8 12.2 (2.4) Delinquency payments for electricity gas and other sectors 9.5 5.9 3.6 Other minor items 53.2 44.6 8.6 Total 95.3 86.9 8.4 Specifically: \u25aa environmental damage contributions represent the payments to be made to municipalities, on the basis of specific agreements, as compensation for activities that impact on the environment for waste delivered to plants in their municipal territories. The amount of these contributions is related to the amount of waste disposed of annually; \u25aa insurance deductibles include amounts that the Group must repay directly to damaged third parties or insurance companies; \u25aa delinquency payables in the electricity, gas and other sectors mainly represent the amounts, charged to end users, to be retroceded as compensation to previous suppliers who were in arrears for the last three monthly payments, prior to their transition to the Hera Group. This indemnity is applied only to certain specific categories of users, identified by ARERA Resolution no. 593/2017/R and its subsequent amendments and additions. ", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherCurrentLiabilitiesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-449": { "value": "36 Other current liabilities 31 Dec 22 31 Dec 21 Change Payables for advances to the fund for energy and waste management services 441.8 336.9 104.9 Security deposits from customers 383.3 129.8 253.5 Plant investment grants 239.5 228.7 10.8 Advances for works 106.7 50.4 56.3 Fund for energy and waste management service components and equalisation 99.5 85.8 13.7 VAT, excise and additional taxes 83.0 155.0 (72.0) Personnel and employee withholding 82.8 81.7 1.1 Payables to social security institutions 69.4 63.6 5.8 Energy efficiency bonds and emissions trading liabilities 51.6 49.2 2.4 Receivables from electricity and gas sector companies 34.7 \u2010 34.7 Prepaid revenues and other expenses 32.4 167.6 (135.2) Other payables 95.3 86.9 8.4 Total 1,720.0 1,435.6 284.4 \u201cPayables for advances to the Fund for energy and waste management services\u201d comprises non-interest- bearing advances granted by the Fund for energy and waste management services, as follows: \u25aa 243.3 million euro (233.4 million euro at 31 December 2021) for advances in compliance with the integration mechanism set forth by resolution 370/2012/R/Eel and 456/2013/R/Eel by ARERA, for overdue and unpaid receivables from customers managed under a safeguard regime. The latest reports concern the years 2009-2020; \u25aa 182.2 million euro (90 million euro at 31 December 2021) in compliance with the integration mechanism set forth in Law 239 of 23 August 2004 and by ARERA\u2019s Tivg , for the charges for delinquency of services of last resort in the natural gas sector (Fui, Ftf and Fdd) until the 2019-2021 thermic years; \u25aa 12.9 million (11.8 million euro at 31 December 2021) in compliance with Resolution 32/2021/R/Eel (former Resolution 445/2020/R/Eel), relating to the procedures for accessing the reimbursement mechanism for general system charges not collected from end customers and already paid to distribution companies for 2016-2020. The scope is restricted to the sale of electricity on the free market, the Safeguard market (disconnectable) and the gradual protection service (disconnectable). \u201cSecurity deposits from customers\u201d reflect the amounts requested from customers for gas, water and electricity provision contracts. The significant increase for the period is mainly due to: \u25aa the award of six lots of the gas last resort service and a further nine lots of the gas distribution default service for the period 1 October 2021 - 30 September 2023; \u25aa the award of four lots of the Consip EE19 tender for the supply of electricity to public administrations in 2022; \u25aa the increase in commodity prices that occurred during the period, which was reflected in a higher value of security deposits charged to customers. \u201cPlant investment grants\u201d decreases in proportion to the amount of depreciation calculated on the fixed assets in question and increases as a result of new investments subject to grants. The item includes specifically, the following grants received by the Group: 31 Dec 22 31 Dec 21 Change New water system investment fund; 87.1 73.0 14.1 Purification plant in Servola (Trieste) 33.0 36.0 (3.0) Purification and sewarage systems 32.0 33.2 (1.2) Construction of rolling basins e underwater pipes in the area of Rimini. 20.6 21.5 (0.9) Other minor items 66.8 65.0 1.8 Total 239.5 228.7 10.8 \u201cAdvances for works\u201d includes advances received from municipalities and apartment buildings for works in progress relating to public lighting and energy efficiency upgrades of private buildings, respectively, which will be completed in the following years. The significant increase is in line with the increase in energy efficiency work carried out by the Group, as reported in Note 1 \u201cRevenues\u201d. \u201cFund for energy and waste management service components and equalisation\u201d, reflects the liabilities for the Fund for energy and waste management services mainly due to some system components of the gas, water and electricity service for 84.1 million euro (84.8 million euro at 31 December 2021) and equalization of the electricity service for 15.4 million euro (1 million euro at 31 December 2021). \u201cVAT, excise and additional taxes\u201d includes payables for VAT in the amount of 0.9 million euro (78.9 million euro at 31 December 2021), and excise and additional taxes in the amount of 82.1 million euro (76.1 million euro at 31 December 2021). As outlined in Note 35, \u201cOther current assets\u201d, this increase must be understood taking into account the factors that regulate financial relations with the Inland Revenue Office, which can generate credit/debit positions with differences that can be significant even between one financial period and another. With regard to value-added tax, the decrease in the year was mainly related to the payment of the advance concerning the Group VAT for 90.3 million euro at the end of the financial period, which resulted in a credit balance as at 31 December, whereas last year, in application of the historical method, the advance had not been paid. The payment of the advance depended on the dynamics of the turnover issued, in particular relating to the greater volumes on the markets for last resort gas services and the trend in energy commodity prices, which increased the taxable base, even in the presence of a reduction in the rate to 5% for the supply of methane gas for residential and industrial use, which only partially mitigated the volumetric effect. With regard to excise and additional taxes, the advance payment in 2022 was made, as required by the regulations in force, on the basis of the volumes invoiced in the previous year. However, the accrued liability was generated on the basis of the volumes invoiced in the year 2022 which were higher than in the year 2021. \u201cPersonnel and employee withholding\u201d includes for the most part the vacation time accrued and not used, as well as the productivity bonuses accounted for by department, plus withholding taxes to be paid to the State treasury as tax substitute for employees. \u201cPayables to social security institutions\u201d relates to contributions owed to these institutions for the December salaries, performance bonuses and additional monthly payments under national collective agreements. \u201cEnergy efficiency bonds and emissions trading\u201d, includes: 31 Dec 22 31 Dec 21 Change Grey certificate. 22.5 17.2 5.3 White certificates 17.9 26.7 (8.8) Guarantee of origin certificates 11.2 5.3 5.9 Total 51.6 49.2 2.4 Grey certificates reflect the valuation of both the forward sale and purchase contracts of greenhouse gas emission allowances in the amount of 11.8 million euro (6.6 euro million at 31 December 2021) and the obligation to redeliver certificates calculated on the basis of current regulations in the amount of 10.7 million euro(10.6 million euro at 31 December 2021). The change compared to the previous year is due to higher volumes of forward contracts, while market prices were largely unchanged. White certificates include, beginning in the 2021 financial year, the valuation of exposure with respect to obligations to return energy efficiency certificates not yet in the portfolio to the relevant authorities. The change as compared to 31 December 2021 is mainly due to the decrease in certificates not yet cancelled in respect of the years for which the Group has not yet fully complied with the allocated accrual obligation. Guarantee of origin (GO) certificates concern certification obligations for electricity produced from renewable energy sources for sales made to customers with this type of supply. The increase in the liability is due to the increase in the market price over the course of 2022. \u201cReceivables from electricity and gas sector companies\u201d mainly include receivables entered by the Group\u2019s distribution companies against third-party sales companies These positions were generated at 31 December 2022 as a result of the measures against high energy prices, as illustrated in Note 35 \u201cOther current assets\u201d in the item \u201cReceivables from electricity and gas companies\u201d. The item \u201cAnticipated revenues and other expenses\u201d comprises portions of revenues already invoiced falling due in the following financial period. The item specifically comprises for 9 million euro (146.8 million euro at 31 December 2021) invoices issued at the end of 2021 for energy efficiency operations benefiting from tax incentives for which the work will be completed in the 2023 financial year. The item \u201cother payables\u201d mainly comprises the following: 31 Dec 22 31 Dec 21 Change Tariff concessions to users 11.5 12.8 (1.3) Environmental damage contributions 11.3 11.4 (0.1) Insurance deductibles 9.8 12.2 (2.4) Delinquency payments for electricity gas and other sectors 9.5 5.9 3.6 Other minor items 53.2 44.6 8.6 Total 95.3 86.9 8.4 Specifically: \u25aa environmental damage contributions represent the payments to be made to municipalities, on the basis of specific agreements, as compensation for activities that impact on the environment for waste delivered to plants in their municipal territories. The amount of these contributions is related to the amount of waste disposed of annually; \u25aa insurance deductibles include amounts that the Group must repay directly to damaged third parties or insurance companies; \u25aa delinquency payables in the electricity, gas and other sectors mainly represent the amounts, charged to end users, to be retroceded as compensation to previous suppliers who were in arrears for the last three monthly payments, prior to their transition to the Hera Group. This indemnity is applied only to certain specific categories of users, identified by ARERA Resolution no. 593/2017/R and its subsequent amendments and additions. ", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherLiabilitiesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-474": { "value": "\u201cSecurity deposits from customers\u201d reflect the amounts requested from customers for gas, water and electricity provision contracts. The significant increase for the period is mainly due to: \u25aa the award of six lots of the gas last resort service and a further nine lots of the gas distribution default service for the period 1 October 2021 - 30 September 2023; \u25aa the award of four lots of the Consip EE19 tender for the supply of electricity to public administrations in 2022; \u25aa the increase in commodity prices that occurred during the period, which was reflected in a higher value of security deposits charged to customers. ", "dimensions": { "concept": "ifrs-full:DisclosureOfDepositsFromCustomersExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-64": { "value": "Business combinations (supplementary information) Business combinations have been accounted for on the basis of assessments conducted by management in respect of analyses of the fair value of assets and liabilities and contingent liabilities, in line with information concerning facts and events available at the date of acquisition. The evaluation process of all operations ended on 31 December 2022. The table below shows the assets and liabilities acquired as part of business combinations carried out during the year, recognised at their fair value. Alibardi Fiorenzo Srl Con Energia Spa Macero Maceratese Srl \u201cBfeng\u201d branch \u201cNonantola\u201d branch Total business combinations Non-current assets Tangible assets 0.1 5.7 7.5 13.3 Rights of use 0.3 1.7 2.0 Intangible assets 34.4 10.1 12.0 56.5 Shareholdings 0.1 0.1 Financial assets 0.1 0.1 Deferred tax assets 0.4 0.2 0.6 Current assets Inventory and work in progress 0.1 0.1 Commercial receivables 0.3 7.3 6.0 13.6 Financial assets 2.2 2.2 Current tax assets 0.1 0.1 Other current assets 0.2 0.4 1.6 2.2 Cash holdings 4.2 0.2 4.4 Non-current liabilities Financial liabilities (1.5) (4.4) (5.9) Lease liabilities (0.3) (1.1) (1.4) Post-employment (0.1) (0.4) (0.5) Provisions for risks and charges (0.1) (0.1) Deferred tax liabilities (9.9) (3.4) (13,.3) Current liabilities Financial liabilities (1.9) (1.9) Lease liabilities (0.5) (0.5) Commercial payables (0.1) (5.9) (2.8) (8.8) Current tax liabilities (0.1) (0.2) (0.3) Other current liabilities (0.1) (3.0) (1.0) (0.1) (4.2) Total net assets acquired 0.4 30.0 12.9 12.0 3.0 58.3 Equivalent fair value 1.4 30.0 11.1 12.0 54.5 Minority shareholders\u2019 put option 6.0 3.0 9.0 Total value of the combination 1.4 30.0 17.1 12.0 3.0 63.5 Goodwill) / Profit (1.0) \u2010 (4.2) \u2010 \u2010 (5.2) The evaluation process resulted in the following adjustments to the carrying amounts recorded in the financial statement of the acquired entity, as well as the following considerations in relation to the amount transferred: Alibardi Fiorenzo Srl Con Energia Spa Macero Maceratese Srl \u201cBfeng\u201d branch \u201cNonantola\u201d branch Total business combinations Book value of net assets acquired 0.4 6.7 5.7 12.0 3.0 27.8 Adjustments for fair value valuation Tangible assets 0.6 0.6 Intangible assets 34.3 10.0 44.3 Commercial receivables (1.5) (1.5) Deferred tax assets (liabilities) (9.5) (3.4) (12.9) Fair value of net assets acquired 0.4 30.0 12.9 12.0 3.0 58.3 Cash outlay 1.4 30.0 10.0 12.0 53.4 Deferred/contingent consideration 1.1 1.1 Equivalent fair value 1.4 30.0 11.1 12.0 - 54.5 The managements\u2019 evaluation of the fair value of the identifiable assets acquired and liabilities incurred, which also considered the recoverable value of the assets, led to the following amendments being identified: \u25aa Con Energia Srl \u2013 a customer list of 34.3 million euro was recorded, with an estimated useful life of 15 years calculated on the basis of the estimated churn rate of the acquired customers. In addition, the allowance for bad debts was adjusted by 1.5 million euro to adjust the commercial receivables acquired to their recoverable value based on the valuation methods used by the Hera Group. \u25aa Macero Maceratese Srl \u2013 customer list of 10 million euro was recorded, established on the basis of both the characteristics of the reference context and using the incremental cash flow method (Meem). The depreciation period, equal to 18 years, was determined on the basis of the churn rate established by analysing the historical series of the turnover of the major clients. Additionally, an increase in the value of the building owned by the company for 0.6 million euro was recorded; The effects reported above resulted, where applicable, in the recognition of deferred tax liabilities determined on the basis of the applicable nominal tax rate. With reference to the acquisition of Macero Maceratese Srl, it should be noted that a cross option to buy and sell the outstanding shareholding was negotiated with the counterparty, while in the acquisition of the \u201cNonantola\u201d branch a put option that benefits the counterparty was negotiated. The existence of such rights held by the minority shareholders led to the need to classify the options in the consolidated financial statements under financial liabilities, as illustrated in Note 19 \u201cFinancial liabilities\u201d. In accordance with its own accounting policies, the Group did not include the minority shares in the consolidated financial statements, considering the shareholding to be fully owned. The valuation of the options identified at the time of acquisition, therefore, totalled 9 million euro. In relation to the acquisition of the Bfeng business unit \u2013 a right of use, in force until 2043, was recognised in the financial statements of the purchaser Hera Spa concerning the operation, ordinary and extraordinary maintenance of an electro-thermofrigorific power plant located in the municipality of Bologna, amounting to 12 million euro. Please see note 28 \u201cCashflows from investing activities\u201d for an analysis of the cash flows associated with the combination operations described above. Adjustments for fair value valuation", "dimensions": { "concept": "ifrs-full:DisclosureOfBusinessCombinationsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-66": { "value": "Accounting standards, amendments and interpretations applicable from 1 January 2022 Beginning 1 January 2022, the following accounting standards and associated amendments as issued by the IASB and endorsed by the European Union apply:", "dimensions": { "concept": "ifrs-full:DescriptionOfInitialApplicationOfStandardsOrInterpretations", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-65": { "value": "Amendments to IFRS 3 \u2013 Reference to the Conceptual Framework. Document issued by IASB on 14 May 2020, applicable from 1 January 2022 with early application allowed. The amendments require entities to refer to the Conceptual Framework published in March 2018 and not the one in force when IFRS3 was introduced. It also introduces an exception to the use of the Conceptual Framework for certain types of liabilities, requiring to refer to IAS 37 when applying IFRS 3. Without this exception, an entity might recognise liabilities in gaining control of a business that it would not otherwise recognise, and immediately after the acquisition it would have to derecognise those liabilities by recording income that has no economic substance. Amendments to IAS 16 \u2013 Selling items produced while bringing an asset into the location and condition for its intended use. Document issued by IASB on 14 May 2020, applicable from 1 January 2022 with early application allowed. This amendment prohibits deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced before that asset is in the location and condition necessary for it to be capable of operating in the manner intended by management. The entity must recognise the proceeds from selling such items, and the cost of producing those items, in profit or loss for the period. Amendments to IAS 37 \u2013 Onerous Contracts: cost of fulfilling a contract. Document issued by IASB on 14 May 2020, applicable from 1 January 2022 with early application allowed. The changes specify that the cost of fulfilling a contract must comprise all the costs that relate directly to the contract. Accordingly, the valuation includes not only incremental costs (such as the cost of material used in the processing), but also all costs that the company cannot avoid because it entered into the contract (such as the share of personnel costs and depreciation of machinery used to fulfil the contract). On 14 May 2020 the IASB published the document \u201cImprovements to the International Financial Reporting Standard: 2018-2020 Cycle\u201d. These improvements include amendments to existing international accounting standards, including: \u25aa IFRS 1 - First adoption of International Financial Reporting Standards. The improvement allows a subsidiary to measure cumulative exchange differences for all foreign currency transactions using the amounts that were recognised in the consolidated financial statements, based on the parent company\u2019s date of first adoption; \u25aa IFRS 9 - Financial Instruments. It specifies that the only fees to be taken into account for the purposes of the 10% test for derecognising a financial liability are those exchanged between the entity and the lender; \u25aa IFRS 16 - Leases. The improvement revises the illustrative example number 13, excluding the reimbursement of costs incurred to improve third-party assets, in order not to cause confusion on how to apply incentives on contracts. With reference to the application of these amendments, there were no observable effects on the Group\u2019s financial statements. Accounting standards, amendments and interpretations endorsed by the European Union which are not yet applicable and have not been adopted early by the Group. With reference to the areas that are significant for the Group, the following accounting standard amendments will be mandatory from the following financial year onwards, having also already been endorsed by the EU: Amendments to IAS 1 - Disclosure of financial statements and accounting policies. Document issued by IASB on 12 February 2021, applicable from 1 January 2023 with early application allowed. The amendments require entities to disclose their material accounting policies rather than their significant accounting policies and provide guidance to explain the application of the materiality process. Amendments to IAS 8 - Accounting Policies, Changes in Accounting Estimates and Errors. Document issued by IASB on 12 February 2021, applicable from 1 January 2023 with early application allowed. The amendments additionally clarify that companies should distinguish between changes to accounting policies and changes to accounting estimates. Amendments to IAS 12 - Deferred taxes related to assets and liabilities arising from a single transaction. Document issued by IASB on 7 May 2021, applicable from 1 January 2023 with early application allowed. The amendments clarify how companies should account for deferred tax on transactions such as leases and contracts with decommissioning obligations that may generate assets and liabilities of equal amounts, for which the exemption for reporting deferred taxation does not apply when assets and liabilities are recognised for the first time. The amendments aim at reducing the differences in deferred tax reporting between different types of contracts. These amendments clarify, correct or remove redundant statements or formulations in the text of the relevant standards. The directors are currently assessing possible effects deriving from the introduction of these amendments into the Group\u2019s consolidated financial statement. Accounting standards, amendments and interpretations that have not yet been endorsed by the European Union The following standards, amendments and updates of IFRSs (already approved by IASB) and interpretations (already approved by IFRS IC) that are relevant for the Group are currently being endorsed by the relevant bodies of the European Union: Amendments to IAS 1 - Presentation of financial statements: reporting liabilities as current or non- current. Document issued by IASB on 23 January 2020 and updated on 15 July 2020, applicable from 1 January 2024 with early application allowed. The amendments clarify the requirements to be considered in determining whether payables and other liabilities with uncertain settlement date should be classified as current or non-current in the statement of financial position (including payables that can be settled by conversion into equity instruments). Amendments to IFRS 16 - Lease Liabilities in a Sale and Leaseback Transaction. Document issued by IASB on 2 September 2022, applicable from 1 January 2024 with early application allowed. The amendments provide that in the valuation of lease liabilities in a sale and leaseback transaction, the seller-lessee shall determine the lease payments in such a way as not to recognise any amount of gain or loss related to the right of use retained by the lessee. Amendments to IAS 1 - Presentation of financial statements: non-current liabilities subject to covenant. Document issued by IASB on 31 October 2022, applicable from 1 January 2024 with early application allowed. The amendments aim to improve the information disclosed by an entity when the right to defer settlement of a liability is subject to compliance with covenants within 12 months after the reporting period. With reference to the new amendments described above, the directors are currently evaluating what possible effects introducing them might have on the Group\u2019s consolidated financial statements.", "dimensions": { "concept": "ifrs-full:DescriptionOfExpectedImpactOfInitialApplicationOfNewStandardsOrInterpretations", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-507": { "value": "Classification of financial assets and liabilities pursuant to IFRS 7 The table below illustrates the composition of the Group\u2019s assets, using the current and non-current distinction. The fair value of other investments and derivative financial instruments is discussed in Notes 26 and 29, respectively. 31 Dec 22 Hierarchy fair Value Fair value to income statement Fair value to statement of comprehensive income Depreciated cost Total Non-current financial assets 2 2.0 149.8 151.8 Non-current assets \u2010 2.0 149.8 151.8 Commercial receivables 3 168.6 3,706.4 3,875.0 Current financial assets 77.7 77.7 Other assets 2 22.6 8.3 657.6 688.5 Current assets 22.6 176.9 4,441.70 4,641.2 31 Dec 21 Hierarchy fair Value Fair value to income statement Fair value to statement of comprehensive income Depreciated cost Total Non-current financial assets 2 1.9 140.8 142.7 Non-current assets \u2010 1.9 140.8 142.7 Commercial receivables 3 198.0 2,720.0 2,918.0 Current financial assets 2 29.3 29.3 Other assets 2 26.1 417.4 443.5 Current assets 26.1 198.0 3,166.7 3,390.8 With respect to \u201cNon-current financial assets\u201d reference should be made to Note 18. With respect to \u201cCurrent assets\u201d reference should be made to Notes 13, 18, 33 and 35. The table below illustrates the composition of the Group\u2019s liabilities, using the current and non-current distinction. Details of the fair value of derivatives are provided instead in Note 29. 31 Dec 22 Hierarchy fair Value Fair value to income statement Hedged elements (fair value hedge) Cost Depreciated Total Non-current financial liabilities 2/3 499.5 144.4 5,046.0 5,689.9 Non-current lease liabilities 55.1 55.1 Non-current liabilities 499.5 144.4 5,101.1 5,745.0 Commercial payables 3,093.1 3,093.1 Current financial liabilities 3 13.9 636.2 650.1 Current lease liabilities 21.3 21.3 Other liabilities 2 33.7 1,703.4 1,737.1 Current liabilities 47.6 \u2010 5,454.0 5,501.6 31 Dec 21 Hierarchy fair Value Fair value to income statement Hedged elements (fair value hedge) Cost Depreciated Total Non-current financial liabilities 2/3 590.8 143.7 2,981.5 3,716.0 Non-current lease liabilities 53.2 53.2 Non-current liabilities 590.8 143.7 3,034.7 3,769.2 Commercial payables 2,356.6 2,356.6 Current financial liabilities 3 1.6 498.1 499.7 Current lease liabilities 43.4 43.4 Other liabilities 2 22.5 1,441.0 1,463.5 Current liabilities 24.1 \u2010 4,339.1 4,363.2 With regard to \u201cNon-current financial liabilities\u201d, the fair value hierarchy for hedged items is Level 2, while for items measured at fair value through profit or loss it is Level 3. With respect to \u201cNon-current liabilities\u201d reference is made to Notes 19 and 22. With respect to \u201cNon-current liabilities\u201d reference is made to Notes 13, 19, 22, 34 and 36. ", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialInstrumentsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-506": { "value": "Classification of financial assets and liabilities pursuant to IFRS 7 The table below illustrates the composition of the Group\u2019s assets, using the current and non-current distinction. The fair value of other investments and derivative financial instruments is discussed in Notes 26 and 29, respectively. 31 Dec 22 Hierarchy fair Value Fair value to income statement Fair value to statement of comprehensive income Depreciated cost Total Non-current financial assets 2 2.0 149.8 151.8 Non-current assets \u2010 2.0 149.8 151.8 Commercial receivables 3 168.6 3,706.4 3,875.0 Current financial assets 77.7 77.7 Other assets 2 22.6 8.3 657.6 688.5 Current assets 22.6 176.9 4,441.70 4,641.2 31 Dec 21 Hierarchy fair Value Fair value to income statement Fair value to statement of comprehensive income Depreciated cost Total Non-current financial assets 2 1.9 140.8 142.7 Non-current assets \u2010 1.9 140.8 142.7 Commercial receivables 3 198.0 2,720.0 2,918.0 Current financial assets 2 29.3 29.3 Other assets 2 26.1 417.4 443.5 Current assets 26.1 198.0 3,166.7 3,390.8 With respect to \u201cNon-current financial assets\u201d reference should be made to Note 18. With respect to \u201cCurrent assets\u201d reference should be made to Notes 13, 18, 33 and 35. The table below illustrates the composition of the Group\u2019s liabilities, using the current and non-current distinction. Details of the fair value of derivatives are provided instead in Note 29. 31 Dec 22 Hierarchy fair Value Fair value to income statement Hedged elements (fair value hedge) Cost Depreciated Total Non-current financial liabilities 2/3 499.5 144.4 5,046.0 5,689.9 Non-current lease liabilities 55.1 55.1 Non-current liabilities 499.5 144.4 5,101.1 5,745.0 Commercial payables 3,093.1 3,093.1 Current financial liabilities 3 13.9 636.2 650.1 Current lease liabilities 21.3 21.3 Other liabilities 2 33.7 1,703.4 1,737.1 Current liabilities 47.6 \u2010 5,454.0 5,501.6 31 Dec 21 Hierarchy fair Value Fair value to income statement Hedged elements (fair value hedge) Cost Depreciated Total Non-current financial liabilities 2/3 590.8 143.7 2,981.5 3,716.0 Non-current lease liabilities 53.2 53.2 Non-current liabilities 590.8 143.7 3,034.7 3,769.2 Commercial payables 2,356.6 2,356.6 Current financial liabilities 3 1.6 498.1 499.7 Current lease liabilities 43.4 43.4 Other liabilities 2 22.5 1,441.0 1,463.5 Current liabilities 24.1 \u2010 4,339.1 4,363.2 With regard to \u201cNon-current financial liabilities\u201d, the fair value hierarchy for hedged items is Level 2, while for items measured at fair value through profit or loss it is Level 3. With respect to \u201cNon-current liabilities\u201d reference is made to Notes 19 and 22. With respect to \u201cNon-current liabilities\u201d reference is made to Notes 13, 19, 22, 34 and 36. ", "dimensions": { "concept": "ifrs-full:DisclosureOfFairValueOfFinancialInstrumentsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-493": { "value": "Classification of financial assets and liabilities pursuant to IFRS 7 The table below illustrates the composition of the Group\u2019s assets, using the current and non-current distinction. The fair value of other investments and derivative financial instruments is discussed in Notes 26 and 29, respectively. 31 Dec 22 Hierarchy fair Value Fair value to income statement Fair value to statement of comprehensive income Depreciated cost Total Non-current financial assets 2 2.0 149.8 151.8 Non-current assets \u2010 2.0 149.8 151.8 Commercial receivables 3 168.6 3,706.4 3,875.0 Current financial assets 77.7 77.7 Other assets 2 22.6 8.3 657.6 688.5 Current assets 22.6 176.9 4,441.70 4,641.2 31 Dec 21 Hierarchy fair Value Fair value to income statement Fair value to statement of comprehensive income Depreciated cost Total Non-current financial assets 2 1.9 140.8 142.7 Non-current assets \u2010 1.9 140.8 142.7 Commercial receivables 3 198.0 2,720.0 2,918.0 Current financial assets 2 29.3 29.3 Other assets 2 26.1 417.4 443.5 Current assets 26.1 198.0 3,166.7 3,390.8 With respect to \u201cNon-current financial assets\u201d reference should be made to Note 18. With respect to \u201cCurrent assets\u201d reference should be made to Notes 13, 18, 33 and 35. The table below illustrates the composition of the Group\u2019s liabilities, using the current and non-current distinction. Details of the fair value of derivatives are provided instead in Note 29. 31 Dec 22 Hierarchy fair Value Fair value to income statement Hedged elements (fair value hedge) Cost Depreciated Total Non-current financial liabilities 2/3 499.5 144.4 5,046.0 5,689.9 Non-current lease liabilities 55.1 55.1 Non-current liabilities 499.5 144.4 5,101.1 5,745.0 Commercial payables 3,093.1 3,093.1 Current financial liabilities 3 13.9 636.2 650.1 Current lease liabilities 21.3 21.3 Other liabilities 2 33.7 1,703.4 1,737.1 Current liabilities 47.6 \u2010 5,454.0 5,501.6 31 Dec 21 Hierarchy fair Value Fair value to income statement Hedged elements (fair value hedge) Cost Depreciated Total Non-current financial liabilities 2/3 590.8 143.7 2,981.5 3,716.0 Non-current lease liabilities 53.2 53.2 Non-current liabilities 590.8 143.7 3,034.7 3,769.2 Commercial payables 2,356.6 2,356.6 Current financial liabilities 3 1.6 498.1 499.7 Current lease liabilities 43.4 43.4 Other liabilities 2 22.5 1,441.0 1,463.5 Current liabilities 24.1 \u2010 4,339.1 4,363.2 With regard to \u201cNon-current financial liabilities\u201d, the fair value hierarchy for hedged items is Level 2, while for items measured at fair value through profit or loss it is Level 3. With respect to \u201cNon-current liabilities\u201d reference is made to Notes 19 and 22. With respect to \u201cNon-current liabilities\u201d reference is made to Notes 13, 19, 22, 34 and 36. ", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialInstrumentsAtFairValueThroughProfitOrLossExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-475": { "value": "Classification of financial assets and liabilities pursuant to IFRS 7 The table below illustrates the composition of the Group\u2019s assets, using the current and non-current distinction. The fair value of other investments and derivative financial instruments is discussed in Notes 26 and 29, respectively. 31 Dec 22 Hierarchy fair Value Fair value to income statement Fair value to statement of comprehensive income Depreciated cost Total Non-current financial assets 2 2.0 149.8 151.8 Non-current assets \u2010 2.0 149.8 151.8 Commercial receivables 3 168.6 3,706.4 3,875.0 Current financial assets 77.7 77.7 Other assets 2 22.6 8.3 657.6 688.5 Current assets 22.6 176.9 4,441.70 4,641.2 31 Dec 21 Hierarchy fair Value Fair value to income statement Fair value to statement of comprehensive income Depreciated cost Total Non-current financial assets 2 1.9 140.8 142.7 Non-current assets \u2010 1.9 140.8 142.7 Commercial receivables 3 198.0 2,720.0 2,918.0 Current financial assets 2 29.3 29.3 Other assets 2 26.1 417.4 443.5 Current assets 26.1 198.0 3,166.7 3,390.8 With respect to \u201cNon-current financial assets\u201d reference should be made to Note 18. With respect to \u201cCurrent assets\u201d reference should be made to Notes 13, 18, 33 and 35. The table below illustrates the composition of the Group\u2019s liabilities, using the current and non-current distinction. Details of the fair value of derivatives are provided instead in Note 29. 31 Dec 22 Hierarchy fair Value Fair value to income statement Hedged elements (fair value hedge) Cost Depreciated Total Non-current financial liabilities 2/3 499.5 144.4 5,046.0 5,689.9 Non-current lease liabilities 55.1 55.1 Non-current liabilities 499.5 144.4 5,101.1 5,745.0 Commercial payables 3,093.1 3,093.1 Current financial liabilities 3 13.9 636.2 650.1 Current lease liabilities 21.3 21.3 Other liabilities 2 33.7 1,703.4 1,737.1 Current liabilities 47.6 \u2010 5,454.0 5,501.6 31 Dec 21 Hierarchy fair Value Fair value to income statement Hedged elements (fair value hedge) Cost Depreciated Total Non-current financial liabilities 2/3 590.8 143.7 2,981.5 3,716.0 Non-current lease liabilities 53.2 53.2 Non-current liabilities 590.8 143.7 3,034.7 3,769.2 Commercial payables 2,356.6 2,356.6 Current financial liabilities 3 1.6 498.1 499.7 Current lease liabilities 43.4 43.4 Other liabilities 2 22.5 1,441.0 1,463.5 Current liabilities 24.1 \u2010 4,339.1 4,363.2 With regard to \u201cNon-current financial liabilities\u201d, the fair value hierarchy for hedged items is Level 2, while for items measured at fair value through profit or loss it is Level 3. With respect to \u201cNon-current liabilities\u201d reference is made to Notes 19 and 22. With respect to \u201cNon-current liabilities\u201d reference is made to Notes 13, 19, 22, 34 and 36. ", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialInstrumentsDesignatedAtFairValueThroughProfitOrLossExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-67": { "value": "Reporting by operational sector Reporting by operational sectors is based on the approach management uses to monitor the performance of the Group by homogeneous business areas. The net costs and assests for business support functions, in keeping with the internal control model, are entirely associated to operational businesses. At 31 December 2022, the Hera Group was organized into the following business lines: \u25aa Gas: includes the costs of distributing and selling methane gas as well as district heating and energy services; \u25aa Electricity: includes the costs of producing, distributing and selling electricity; \u25aa Water Cycle: includes aqueduct, purification and sewage services; \u25aa Waste management: includes waste collection, treatment, recycling and disposal services; \u25aa Other services: includes public lighting, telecommunications and other minor services. The following are assets and liabilities by business line for the 2021 and 2022 financial years: 31 Dec 22 Gas Electricity Water cycle Waste management Other services Total Current year Assets (tangible and intangible) 2,038.8 655.4 2,320.2 1,348.5 123.1 6,486.0 Goodwill 493.5 73.5 42.7 233.5 4.9 848.1 Shareholdings 99.6 29.8 18.7 42.2 \u2010 190.3 Not attributed fixed assets 24.7 Net fixed assets 2,631.9 758.7 2,381.6 1,624.2 128.0 7,549.1 Attributed net working capital 804.8 80.3 (247.8) 59.3 2.9 699.5 Non attributed net working capital 303.5 Net working capital 804.8 80.3 (247.8) 59.3 2.9 1,003.0 Other provisions (191.4) (35.8) (148.1) (278.5) (3.8) (657.6) Net invested capital 3,245.3 803.2 1,985.7 1,405.0 127.1 7,894.5 31 Dec 21 Gas Electricity Water cycle Waste management Other services Total Previous year Assets (tangible and intangible) 1,943.3 647.6 2,134.2 1,315.4 128.8 6,169.3 Goodwill 494.8 72.2 42.7 228.3 4.9 842.9 Shareholdings 111.7 30.4 18.9 37.5 \u2010 198.5 Not attributed fixed assets 97.3 Net fixed assets 2,549.8 750.2 2,195.8 1,581.2 133.7 7,308.0 Attributed net working capital (95.5) 108.1 (155.4) 66.8 (7.9) (83.9) Non attributed net working capital 87.4 Net working capital (95.5) 108.1 (155.4) 66.8 (7.9) 3.5 Other provisions (181.1) (33.4) (129.4) (285.2) (4.3) (633.4) Net invested capital 2,273.2 824.9 1,911.0 1,362.8 121.5 6,678.1 The following are the main result measures by business line for the 2021 and 2022 financial years: 2022 Gas Electricity Water cycle Waste management Other services Structure Total Current financial period Direct revenues 13,282.8 4,720.7 996.5 1,272.1 145.4 51.5 20,630.2 Infra-cycle revenues 181.9 316.3 4.5 34.9 50.1 63.0 723.7 Total direct revenues 13,464.7 5,037.1 915.8 1,00.9 195.5 114.5 21,354.0 Indirect revenues 18.9 5.7 48.9 51.7 0.7 (114.5) \u2010 Total revenues 13,483.6 5,047.2 964.7 1,052.6 196.2 \u2010 21,354.0 EBITDA 491.1 71.6 262.4 261.9 38.4 \u2010 1,200.9 Direct amortisations and provisions 205.5 87.7 121.2 125.6 22.2 76.9 667.1 Indirect amortisations and provisions 8.8 3.1 35.4 34.5 0.5 (76.9) \u2010 Total amortisations and provisions 214.3 90.8 156.5 160.1 22.6 \u2010 667.1 Operating revenues 276.8 (19.2) 105.9 101.8 15.7 \u2010 533.8 2021 Gas Electricity Water cycle Waste management Other services Structure Total Previous financial period Direct revenues 5,833.6 2,784.2 911.1 1,272.1 125.9 28.5 10,955.4 Infra-cycle revenues 109.0 233.1 4.7 34.9 44.2 76.1 502.1 Total direct revenues 5,942.7 3,017.2 915.8 1,307.0 170.2 104.7 11,457.5 Indirect revenues 26.3 7.4 48.9 21.4 0.6 (104.7) \u2010 Total revenues 5,969.0 3,024.6 964.7 1,328.4 170.8 \u2010 11,457.5 EBITDA 487.6 144.7 262.4 291.7 37.4 \u2010 1,223.9 Direct amortisations and provisions 173.8 69.7 121.2 152.0 20.4 75.0 612.1 Indirect amortisations and provisions 8.0 3.0 35.4 28.1 0.5 (75.0) \u2010 Total amortisations and provisions 181.9 72.7 156.5 180.2 20.9 \u2010 612.1 Operating revenues 305.8 72.0 105.9 111.6 16.4 \u2010 611.7 As extensively described in the Directors\u2019 Report, the EBITDA of the gas operating segment was adjusted for management purposes to comment on its performance for the period. The value containing the adjustment on gas inventory valuation is shown in chapter 1.07, \"Analysis by Business Area;\" please refer to this section for its understanding of business dynamics. ", "dimensions": { "concept": "ifrs-full:DisclosureOfEntitysReportableSegmentsExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-476": { "value": "Reporting by operational sectors is based on the approach management uses to monitor the performance of the Group by homogeneous business areas. The net costs and assests for business support functions, in keeping with the internal control model, are entirely associated to operational businesses. ", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForSegmentReportingExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-420": { "value": "FINANCIAL STATEMENT FORMATS AS PER CONSOB RESOLUTION 15519/2006 In accordance with the relevant Group policies, the economic, equity and financial reports in effect at 31 December 2022 and the associated period of comparison with related parties are as follows. Procedure for the operations with related parties is available on the website of the Hera Group at the following link: https://www.gruppohera.it/gruppo/governance/sistema-di-governance/politiche-e-procedure It should be noted that during the year 2022, there were no operations with related parties for which it was necessary to include in the financial statements the information required by the regulation adopted on this matter through CONSOB Resolution no. 17221 of 12 March 2010 and following amendments and integrations.
2.03
Income statement as per Consob resolution 15519/ 2006 notes 2022 of which related parties 2021 of which related parties A B C D Total % A B C D Total % Revenues 1 20,082.0 \u2010 129.1 315.6 23.6 468.3 2.3% 10,555.3 \u2010 58.0 319.4 13.1 390.5 3.7% Other operating revenues 2 548.2 \u2010 0.3 3.2 \u2010 3.5 0.6% 400.1 \u2010 0.3 7.1 0.5 7.9 2.0% Raw materials and materials 3 (16,730.0) \u2010 (100.2) \u2010 (45.0) (145.2) 0.9% (6,668.5) \u2010 (104.7) \u2010 (46.1) (150.8) 2.3% Service costs 4 (2,105.8) \u2010 (11.9) (23.3) (33.2) (68.4) 3.2% (2,464.6) \u2010 (8.6) (19.8) (33.9) (62.3) 2.5% Personnel costs 5 (601.1) \u2010 \u2010 \u2010 \u2010 \u2010 (592.8) \u2010 \u2010 \u2010 \u2010 \u2010 Other operating costs 6 (74.9) \u2010 \u2010 (2.3) (0.9) (3.2) 4.3% (66.5) \u2010 \u2010 (1.8) (0.6) (2.4) 3.6% Capitalised costs 7 82.5 \u2010 \u2010 \u2010 \u2010 \u2010 60.8 \u2010 \u2010 \u2010 \u2010 \u2010 Amortisation, provisions and depreciation 8 (667.1) \u2010 \u2010 \u2010 \u2010 \u2010 (612.1) \u2010 (4.0) \u2010 \u2010 (4.0) 0.7% Operating revenues 533.8 \u2010 17.3 293.2 (55.5) 255.0 611.7 \u2010 (59.0) 304.9 (67.0) 178.9 Share of profits (losses) pertaining to joint ventures and associated companies 9 10.0 \u2010 10.0 \u2010 \u2010 10.0 100.0% 13.2 \u2010 13.2 \u2010 \u2010 13.2 100.0% Financial income 10 82.2 \u2010 1.6 0.6 0.4 2.6 3.2% 82.3 \u2010 4.8 0.7 0.4 5.9 7.2% Financial expenses 11 (217.2) \u2010 \u2010 (0.3) \u2010 (0.3) 0.1% (300.3) \u2010 (2.4) (0.3) \u2010 (2.7) 0.9% Financial operations (125.0) \u2010 11.6 0.3 0.4 12.3 (204.8) \u2010 15.6 0.4 0.4 16.4 Earnings before taxes 408.8 \u2010 28.9 293.5 (55.1) 267.3 406.9 \u2010 (43.4) 305.3 (66.6) 195.3 Taxes 12 (103.5) \u2010 - \u2010 \u2010 - (34.2) \u2010 \u2010 \u2010 \u2010 \u2010 Net profit for the year 305.3 \u2010 28.9 293.5 (55.1) 267.3 372.7 \u2010 (43.4) 305.3 (66.6) 195.3 Attributable to: Parent company shareholders 255.2 333.5 Minority shareholders 50.1 39.2 Earnings per share basic 17 0.175 0.228 diluted 17 0.175 0.228 Column headings related parties: A non-consolidated subsidiaries, B Associated and jointly controlled companies, C Related companies with significant influence (shareholder municipalities), D Other related parties 2.03.01 Statement of financial position as per Consob resolution 15519/ 2006 notes 31 Dec 22 of which related parties 31 Dec 21 of which related parties A B C D Total % A B C D Total % ASSETS Non-current assets Tangible assets 21.25 1,984.4 \u2010 \u2010 \u2010 \u2010 \u2010 1,941.0 \u2010 \u2010 \u2010 \u2010 \u2010 Rights of use 22.25 84.2 \u2010 \u2010 \u2010 \u2010 \u2010 101.6 \u2010 \u2010 \u2010 \u2010 \u2010 Intangible assets 23.25 4,417.4 \u2010 \u2010 \u2010 \u2010 \u2010 4,126.7 \u2010 \u2010 \u2010 \u2010 \u2010 Goodwill 24.25 848.1 \u2010 \u2010 \u2010 \u2010 \u2010 842.9 \u2010 \u2010 \u2010 \u2010 \u2010 Shareholdings 26.27 190.3 \u2010 156.3 \u2010 2.0 158.3 83.2% 198.5 \u2010 152.4 \u2010 2.0 154.4 77.8% Non-current financial assets 18 151.8 \u2010 14.3 12.1 25.3 51.7 34.1% 142.7 \u2010 18.6 13.6 29.8 62.0 43.4% Deferred tax assets 14 240.4 \u2010 \u2010 \u2010 \u2010 \u2010 229.4 \u2010 \u2010 \u2010 \u2010 \u2010 Derivative financial instruments 29 1.0 \u2010 \u2010 \u2010 \u2010 \u2010 6.9 \u2010 \u2010 \u2010 \u2010 \u2010 Total non-current assets 7,917.6 \u2010 170.6 12.1 27.3 210.0 7,589.7 \u2010 171.0 13.6 31.8 216.4 Current assets Inventories 32 995.1 \u2010 \u2010 \u2010 \u2010 \u2010 368.0 \u2010 \u2010 \u2010 \u2010 \u2010 Commercial receivables 33 3,875.0 \u2010 24.9 85.3 24.8 135.0 3.5% 2,918.0 \u2010 10.3 65.6 15.0 90.9 3.1% Current financial assets 18 77.7 \u2010 9.2 3.7 1.4 14.3 18.4% 29.3 \u2010 4.8 4.4 3.2 12.4 42.3% Current tax assets 13 46.0 \u2010 \u2010 \u2010 \u2010 \u2010 21.2 \u2010 \u2010 \u2010 \u2010 \u2010 Other current assets 35 642.5 \u2010 2.9 (2.3) 3.9 4.5 0.7% 422.3 \u2010 2.4 (1.2) 3.9 5.1 1.2% Derivative financial instruments 29 1,622.2 \u2010 \u2010 \u2010 \u2010 \u2010 1,797.4 \u2010 \u2010 \u2010 \u2010 \u2010 Cash and cash equivalents 18 1,942.4 \u2010 \u2010 \u2010 \u2010 \u2010 885.6 \u2010 \u2010 \u2010 \u2010 \u2010 Total current assets 9,200.9 \u2010 37.0 86.7 30.1 153.8 6,441.8 \u2010 17.5 68.8 22.1 108.4 TOTAL ASSETS 17,118.5 \u2010 207.6 98.8 57.4 363.8 14,031.5 \u2010 188.5 82.4 53.9 324.8 Column headings related parties: A non-consolidated subsidiaries, B Associated and jointly controlled companies, C Related companies with significant influence (shareholder municipalities), D Other related parties 2.03.02
notes
31 Dec 22
of which related parties
31 Dec 21
of which related parties
A
B
C
D
Total
%
A
B
C
D
Total
%
NET EQUITY AND LIABILITIES
Share capital and reserves
Share capital
15
1,450.3
\u2010
\u2010
\u2010
\u2010
\u2010
1,459.6
\u2010
\u2010
\u2010
\u2010
\u2010
Reserves
15
1,692.9
\u2010
\u2010
\u2010
\u2010
\u2010
1,407.1
\u2010
\u2010
\u2010
\u2010
\u2010
Profit (loss) for the period
15
255.2
\u2010
\u2010
\u2010
\u2010
\u2010
333.5
\u2010
\u2010
\u2010
\u2010
\u2010
Group net equity
3,398.4
\u2010
\u2010
\u2010
\u2010
\u2010
3,200.2
\u2010
\u2010
\u2010
\u2010
\u2010
Non-controlling interests
16
246.3
\u2010
\u2010
\u2010
\u2010
\u2010
216.6
\u2010
\u2010
\u2010
\u2010
\u2010
Total net equity
3,644.7
\u2010
\u2010
\u2010
\u2010
\u2010
3,416.8
\u2010
\u2010
\u2010
\u2010
\u2010
Non-current liabilities
Non-current financial liabilities
19
5,689.9
\u2010
\u2010
1.5
\u2010
1.5
0.0%
3,716.0
\u2010
\u2010
1.8
\u2010
1.8
0.0%
Non-current lease liabilities
22
55.1
\u2010
\u2010
3.7
0.3
4.0
7.3%
53.2
\u2010
0.1
4.6
0.2
4.9
9.2%
Post-employment and other benefits
30
92.0
\u2010
\u2010
\u2010
\u2010
\u2010
105.4
\u2010
\u2010
\u2010
\u2010
\u2010
Provisions for risks and charges
31
565.6
\u2010
3.8
\u2010
\u2010
3.8
0.7%
528.0
\u2010
1.5
\u2010
\u2010
1.5
0.3%
Deferred tax liabilities
14
215.7
\u2010
\u2010
\u2010
\u2010
\u2010
132.1
\u2010
\u2010
\u2010
\u2010
\u2010
Derivative financial instruments
29
6.3
\u2010
\u2010
\u2010
\u2010
\u2010
13.5
\u2010
\u2010
\u2010
\u2010
\u2010
Total non-current liabilities
6,624.6
\u2010
3.8
5.2
0.3
9.3
4,548.2
\u2010
1.6
6.4
0.2
8.2
Current liabilities
Current financial liabilities
19
650.1
\u2010
5.2
0.5
\u2010
5.7
0.9%
499.7
\u2010
\u2010
0.7
39.4
40.1
8.0%
Current lease liabilities
22
21.3
\u2010
-
1.4
0.1
1.5
7.2%
43.4
\u2010
-
1.2
0.1
1.3
3.1%
Commercial payables
34
3,093.1
\u2010
33.8
22.8
33.3
89.9
2.9%
2,356.6
\u2010
31.8
16.7
24.6
73.1
3.1%
Current tax liabilities
13
17.1
\u2010
\u2010
\u2010
\u2010
\u2010
27.9
\u2010
\u2010
\u2010
\u2010
\u2010
Other current liabilities
36
1,720.0
\u2010
1.5
6.5
0.1
8.1
0.5%
1,435.6
\u2010
4.8
4.8
0.4
10.0
0.7%
Derivative financial instruments
29
1,347.6
\u2010
\u2010
\u2010
\u2010
\u2010
1,703.3
\u2010
\u2010
\u2010
\u2010
\u2010
Total current liabilities
6,849.2
\u2010
40.5
31.2
33.5
105.2
6,066.5
\u2010
36.6
23.4
64.5
124.5
TOTAL LIABILITIES
13,473.8
\u2010
44.3
36.4
33.8
114.5
10,614.7
\u2010
38.2
29.8
64.7
132.7
TOTAL NET EQUITY AND LIABILITIES
17,118.5
\u2010
44.3
36.4
33.8
114.5
14,031.5
\u2010
38.2
29.8
64.7
132.7
Column headings related parties: A non-consolidated subsidiaries, B Associated and jointly controlled companies, C Related companies with significant influence (shareholder municipalities), D Other related parties
Cash flow statement as per Consob resolution 15519/2006 31 Dec 22 of which related parties Earnings before taxes 408.8 Adjustments to reconcile net profit to the cashflow from operating activities Amortisation and impairment of assets 478.6 Allocation to provisions 188.5 Effects from valuation using the net equity method (10.0) Financial (income) expenses 135.0 (Capital gains) losses and other non-monetary elements 41.6 Change in provision for risks and charges (27.8) Change in provision for employee and post-employment benefits (12.7) Total cash flow before changes in net working capital 1,202.0 (Increase) decrease in inventories (627.4) (Increase) decrease in commercial receivables (1,280.7) (44.1) Increase (decrease) in commercial payables 727.8 16.8 Increase/decrease in other current assets/liabilities 252.7 (1.3) Changes in working capital (927.6) Dividends collected 13.4 9.5 Interest income and other financial income collected 41.8 2.6 Interest expenses, net charges on derivatives and other paid financial charges (128.0) (0.3) Taxes paid (165.9) Cash flow from operating activities (a) 35.7 Investments in tangible assets (225.6) Investments in intangible assets (483.9) Investments in subsidiary companies and business units net of cash holdings (50.1) Other equity investments (3.2) (3.2) Sale price of tangible and intangible assets 3.3 0.1 Divestments of shareholdings and contingent consideration \u2010 (Increase) decrease in other investment activities 1.1 10.8 Cash flow from (for) investing activities (b) (758.4) New issue of long-term bonds 2,127.0 Repayments of non-current financial liabilities \u2010 Repayments and other net changes in financial liabilities (47.3) (34.7) Repayment of lease liabilities (43.4) (1.0) Acquisition of Interests in consolidated companies (10.6) Dividends paid out to Hera shareholders and non-controlling interests (219.5) (68.1) Changes in treasury share (26.7) Cash flow from (for) financing activities (c) 1,779.5 Increase (decrease) in cash holdings (a+b+c) 1,056.8 Cash and cash equivalents at the beginning of the period 885.6 Cash and cash equivalents at the end of the period 1,942.4 2.03.03 Net financial debt according to the Consob notice DEM/6064293 of 2006 31 Dec 22 31 Dec 21 A B C D A B C D A Cash holdings 1,942.4 \u2010 \u2010 \u2010 \u2010 885.6 \u2010 \u2010 \u2010 \u2010 B Cash equivalents \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 C Other current financial assets 77.7 \u2010 9.2 3.7 1.4 29.3 \u2010 4.8 4.4 3.2 D Liquidity (A+B+C) 2,020.1 914.9 of which related parties \u2010 9.2 3.7 1.4 \u2010 4.8 4.4 3.2 E Current financial debt (563.0) \u2010 \u2010 (0.5) \u2010 (443.6) \u2010 \u2010 (0.8) (39.4) F Current part of non-current financial debt (108.4) \u2010 (5.2) (1.4) (0.1) (99.5) \u2010 \u2010 (1.2) (0.1) G Current financial indebtedness (E+F) (671.4) (543.1) of which related parties \u2010 (5.2) (1.9) (0.1) \u2010 \u2010 (2.0) (39.5) H Current net financial indebtedness (G+D) 1,348.7 371.8 of which related parties \u2010 (4.0) 1.8 1.3 \u2010 4.8 2.4 (36.3) I Non-current financial debt (2,553.0) \u2010 \u2010 (5.2) (0.3) (1,073.8) \u2010 \u2010 (6.4) (0.2) J Debt instruments (3,197.3) \u2010 \u2010 \u2010 \u2010 (2,702.0) \u2010 \u2010 \u2010 \u2010 K Commercial and other non-current payables \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 \u2010 L Non-current financial indebtedness (I+J+K) (5,750.3) (3,775.8) of which related parties \u2010 \u2010 (5.2) (0.3) \u2010 \u2010 (6.4) (0.2) M Total financial indebtedness (H+L) ESMA guidelines 32 \u2013 382 \u2013 1138 (4,401.6) (3,404.0) of which related parties \u2010 (4.0) (3.4) 1.0 \u2010 4.8 (4.0) (36.5) Non-current financial receivables 151.8 142.7 of which related parties \u2010 14.3 12.1 25.3 \u2010 18.6 13.6 29.8 Net financial debt (4,249.8) (3,261.3) of which related parties \u2010 18.3 8.7 26.3 \u2010 23.4 9.6 (6.7) 2.03.04 List of related parties The values reported in the table at 31 December 2022 refer to the related parties listed below: Group A - Non-consolidated subsidiaries Group B- Affiliated and jointly controlled companies Adria Link Srl Aimag Spa ASM SET Srl Aurora Srl Energo Doo Enomondo Srl Hea Spa H.E.P.T. Co. Ltd Natura Srl in liquidation Oikothen Scarl in liquidation SEA - Servizi Ecologici Ambientali Srl Set Spa Sgr Servizi Spa Sinergie Italiane Srl in liquidation Tamarete Energia Srl Tre Monti Srl Group C - Related parties with signficant influence Municipality of Bologna Municipality of Casalecchio di Reno Municipality of Cesena Municipality of Ferrara Municipality of Imola Municipality of Modena Municipality of Padua Municipality of Ravenna Municipality of Rimini Municipality of Trieste CON.AMI Holding Ferrara Servizi Spa Ravenna Holding Spa Rimini Holding Spa Group D - Other related parties Acosea Impianti Srl Dragone Impianti Spa Acqeduct Aloe Spa Amir Spa - Asset Apa2 consulting Sas Aspes Spa BPI Learning Consulting Spain SL Calenia Energia Spa CIR S.p.A. Co.ra.b. Srl 2.03.05 Cora costr. Resid. Artig. Srl Dental invest Srl Executive Advocacy Srl Fiorano Gestioni Patrimoniali Srl Fonderia cab Srl Fonderia fomar ghisa Srl Formigine Patrimonio Srl Ire immobiliare riqualificazione ed Maranello Patrimonio Srl Medeopart 2 Srl Medeopart 3 Srl Medeopart 4 Srl Medeopart 5 Srl Medeopart 6 Srl Medeopart associates Srl Medeor Capital S.r.l. Rabofin Srl Romagna Acque Spa Sassuolo Gestioni Patrimoniali Srl Se.r.a. Srl catering service Serramazzoni Patrimonio Srl Sis Societ\u00e0 Intercomunale di Servizi Spa in liquidation Societ\u00e0 Italiana Servizi Spa - Sis Spa asset SOGEFI S.p.A. SPS S.r.l. Te.Am Srl Team Srl Unica Reti Spa - Asset Vanpart Srl Auditors, directors, strategic executives, family members of strategic executives Explanatory notes to relations with related parties Service management In most of the areas it serves competence and in almost all of shareholding municipalities for the provinces of Modena, Bologna, Ferrara, Forl\u00ec-Cesena, Ravenna, Rimini, Padua, Udine, Trieste, Gorizia and Pesaro, the Hera Group holds the concession for the local public services of economic interest (distribution of natural gas through local gas pipelines, integrated water service and environmental services, including sweeping, waste collection, transport, recovery and disposal). The electricity distribution service is carried out in the areas of Modena and Imola, and in the municipalities of Trieste and Gorizia. Other public utilities (including urban district heating, energy services and public lighting) are carried out in a free market regime or through specific agreements with the local authorities concerned. Through specific relations with the local authorities and/or local agencies, the Hera Group is also responsible for waste treatment and disposal services, not included in urban hygiene activities. Water sector The water services managed by the Hera Group are carried out in the areas served in the Emilia- Romagna, Veneto, Friuli-Venezia Giulia and Marche regions. It is carried out on the basis of conventions with the relevant local agencies, with a variable duration, which is usually twenty years. The Hera Group\u2019s mandate for managing integrated water services refers to activities of water collection and drinking water treatment and distribution for civil and industrial applications as well as sewerage and sewage treatment. The agreements signed with the local area authorities also require the operator to carry out the planning and construction of new networks and plants aimed at providing the service. The 2.03.06 conventions regulate the economic aspects of the contractual agreement, as well as the modes of managing the service, and the performance and quality standards. Beginning in 2012, authority for rates was transferred to the national agency ARERA which, as part of this task it has been assigned, approved a transitional rate method for the period 2012-2013, a two-year period of consolidation from 2014 to 2015, an additional rate method in force for 2016-2019 and the current provision regime 2020-2023. The adjustment for 2020-2023 is in continuity with the 2016-2019 period with the introduction of a number of new elements aimed at encouraging energy and environmental sustainability actions as well as contract and technical quality. Each operator is granted revenue (VRG) independently of the trends of the volumes distributed and it is established on the basis of operating costs (efficient and exogenous) and capital costs in relation to the investments made, as well as for the Rimini area, the outcome of the tender procedure that led to the new concession contract signed for the period 2022 -2039. For the purpose of carrying out the service, the operator uses networks, facilities and other equipment owned by the company itself, municipalities and Asset companies. These assets, part of the inaccessible water stores, or granted or leased to the provider, must be returned to the municipalities, Asset companies or local area authorities at the end of the concession to be made available to the incoming provider. Any work carried out by the Hera Group for the water service must be returned to the above mentioned entities following payment or the residual value of the assets in question. Hera\u2019s relations with users are regulated by provisioning regulations as well as Service Charters drafted on the basis of templates approved by local area authorities in compliance with provisions set out by ARERA regarding the quality of the service and the resource. Waste management sector The municipal waste service managed by the Hera Group in the area it serves is provided on the basis of agreements with local authorities and comprises the exclusive management of the collection, transportation, sweeping and cleaning of streets, preparations for waste recovery or disposal and other minor services. The agreements entered into with the relevant local authorities regulate the economic aspects of the contractual agreement, as well as the modes of organising and managing the service, and the performance and quality standards. Beginning in 2020, the considerations due to the operator for the services rendered, including municipal waste disposal/treatment/recovery activities, have been defined annually on the basis of the ARERA new national rate regulation (Authority resolution 2019/433), as well as on the basis of the consideration resulting from competitive procedures already concluded, for the areas of new awarding of contracts (the areas of Ravenna and Cesena, Bologna, Modena, and Saccolongo). The municipal waste management service is billed by the Hera Group to the individual municipalities in the case of the Tari regime or to the individual users in the case of the application of the punctual correspondent tariff. To run treatment plants for municipal waste, the Hera Group is required to obtain provincial authorizations; furthermore, for 2022, the subsidiary Herambiente Spa as well is required to comply with the new national regulation with regard to unsorted waste disposal plants and composting and digester plants, as they are classified as \u201cminimum plants\u201d by the regions and are crucial for the closure of the municipal waste management cycle, without prejudice to the outcome of pending administrative litigation proceedings In particular, these judgments concern, with two different appeals, the qualification of so- called minimum plants made by the competent Regions with regard to organic waste treatment plants and disposal plants. In compliance with the principle of continuity of public services, under the terms of the existing agreements, the operator is obliged to continue the service also in the territories where the expiry date of the entrustment has already passed and until new entrustments take effect. Energy sector The duration of licenses for the distribution of natural gas via local gas pipelines, initially set for periods ranging between ten and thirty years by the original agreements stipulated with the municipalities, was revised by Italian decree 164/2000 (so-called Letta Decree, transposing Directive 98/30/EC) and by subsequent reforms of the energy market. Inrete Distribution Energy Spa, an Hera Group company that took over natural gas and electricity distribution from Hera Spa, takes advantage of longer residual terms established for operators that have promoted partial privatizations and mergers. The duration of distribution concessions is unchanged with respect to that foreseen in the company\u2019s stock exchange listing. The agreements associated with the distribution licenses regarding the distribution of natural gas or other similar gases for heating, domestic, handicraft and industry uses, and for other general uses. Rates for the distribution of gas are fixed under current regulations and by periodical resolutions issued by the agency in charge of this sector (Arera). The area in which Inrete Distribuzione Energia Spa provides gas distribution services is divided into rate zones in which a uniform distribution rate is applied to different categories of customers. The tariff regulations in force at the time these annual financial statements were approved are ARERA resolution 620/2021/R/gas of 29 December 2021 (Update of tariffs for gas distribution and metering services, for the year 2022), which replaced the 596/2020/R/gas of 29 December 2020 and which serve to approve the mandatory tariffs for natural gas distribution, metering and marketing services for 2022. The tariff rates valid as from 1 January 2022 are shown in Table 1 attached to the aforementioned resolution. The tariffs for the 2022 financial year are part of the so-called 2020-2025 tariff period. Beginning 1 January 2020, in fact, the new Regulation governing gas distribution and metering service rates for the regulation period 2020-2025 (Rtdg 2020-2025) came into force, approved with resolution 570/2019/R/gas. Pursuant to Article 43 of the Rtdg 2020-2025, the mandatory natural gas distribution and metering tariffs are broken down into different rate areas: \u25aa the northwest area, which includes the regions of Valle d\u2019Aosta, Piedmont and Liguria; \u25aa the northeast area, including the regions of Lombardy, Trentino - Alto Adige, Veneto, Friuli - Venezia Giulia, and Emilia - Romagna; \u25aa the central area, comprising the regions of Tuscany, Umbria and the Marche; \u25aa the central-south-eastern area, including the regions of Abruzzo, Molise, Apulia and Basilicata; \u25aa the central-southwestern area, including the Lazio and Campania regions; \u25aa the southern area, including the regions of Calabria and Sicily; \u25aa the Sardinia area, including the region of Sardinia. The value of the tariff components GS, RE, RS and UG1 referred to in paragraph 42.3, sections c), d), e), f) of the Rtdg 2020-2025 is subject to quarterly updating. Beginning 1 January 2022, for the first six months the values of the last three months of 2021 were confirmed - Resolution 635/2021/R/com and Table t attached to Resolution 396/2021/R/com and beginning 1 April 2022 - Resolution 141/2022/R/com and Table 7 attached to Resolution 396/2021/R/com. For the second half of the year beginning 1 June 2022 with Resolution 295/2022/R/com, the regulatory authority again confirmed the values in Table 7 attached to Resolution 396/2021/R/com, reconfirming them again beginning 1 October 2022 with Resolution 462/2022/R/com. Beginning 1 October 2021 the values are those of Table 7 attached to Resolution 396/2021/R/com. With regard to electricity, the contracts (lasting thirty years and renewable pursuant to the current regulations) govern power distribution activities comprising, inter alia, the management of distribution networks and the operation of associated plants, ordinary and extraordinary maintenance, the planning and identification of development projects, and metering. The contract may be suspended or terminated, on the judgement of the national Authority, if defaults and violations occur on the part of the concessionary company that seriously affect the performance of the distribution and metering of electricity. The distribution company is obliged to apply to its customers (so called Distribution Users) the rates set by current regulations and resolutions adopted by the sector Authority. The rate regulations in effect at the time the annual financial statements were approved is that of the Authority\u2019s resolution 654/2015/R/Eel of 23 December 2015 (Rate regulations for electricity transmission, distribution and metering, for the regulatory period 2016-2023), which replaced the previous Authority resolution Arg/elt no. 199/2011 and subsequent amendments and additions (Official directives for the provision of electricity transmission, distribution and metering services for the regulatory period 2012-2015 and provisions on economic conditions for the provision of connection services), in force until 31 December 2015. With this resolution, the Authority issued the provisions on the tariff regulation of electricity transmission, distribution and measurement services for the 2016-2023 regulatory period, defining an eight-year regulatory period made up of two four-year semi-periods, also providing for an intra-period update between the first and second semi-periods. The mandatory rate for distribution services covers the costs of transporting electricity along distribution networks. It is applied to all end customers, with the exception of low-voltage household customers. The rate has a trinomial structure and is expressed in hundredths of a euro per sampling point per year (fixed component), euro cents per KW per year (power component) and euro cents per kWh consumed (energy component). The compulsory tariff for the distribution service is periodically updated by the national authority Arera by means of an appropriate provision, therefore, on 27 December 2019, resolution 568/2019/R/Eel was issued, approving the tariff regulation of electricity transmission, distribution and measurement services for the 2020-2023 regulatory semi-period. For household customers for the year 2022, the update of tariffs for the delivery of electricity transmission, distribution and metering services has been established by Resolution 623/2021/R/eel of 28 December 2021. For non-household customers, the tariff update for 2022 for the distribution and metering services as well as the economic conditions for the provision of the connection service was established by Resolution 623/2021/R/eel of 28 December 2021. ", "dimensions": { "concept": "ifrs-full:DisclosureOfTransactionsBetweenRelatedPartiesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-68": { "value": "List of related parties The values reported in the table at 31 December 2022 refer to the related parties listed below: Group A - Non-consolidated subsidiaries Group B- Affiliated and jointly controlled companies Adria Link Srl Aimag Spa ASM SET Srl Aurora Srl Energo Doo Enomondo Srl Hea Spa H.E.P.T. Co. Ltd Natura Srl in liquidation Oikothen Scarl in liquidation SEA - Servizi Ecologici Ambientali Srl Set Spa Sgr Servizi Spa Sinergie Italiane Srl in liquidation Tamarete Energia Srl Tre Monti Srl Group C - Related parties with signficant influence Municipality of Bologna Municipality of Casalecchio di Reno Municipality of Cesena Municipality of Ferrara Municipality of Imola Municipality of Modena Municipality of Padua Municipality of Ravenna Municipality of Rimini Municipality of Trieste CON.AMI Holding Ferrara Servizi Spa Ravenna Holding Spa Rimini Holding Spa Group D - Other related parties Acosea Impianti Srl Dragone Impianti Spa Acqeduct Aloe Spa Amir Spa - Asset Apa2 consulting Sas Aspes Spa BPI Learning Consulting Spain SL Calenia Energia Spa CIR S.p.A. Co.ra.b. Srl 2.03.05 Cora costr. Resid. Artig. Srl Dental invest Srl Executive Advocacy Srl Fiorano Gestioni Patrimoniali Srl Fonderia cab Srl Fonderia fomar ghisa Srl Formigine Patrimonio Srl Ire immobiliare riqualificazione ed Maranello Patrimonio Srl Medeopart 2 Srl Medeopart 3 Srl Medeopart 4 Srl Medeopart 5 Srl Medeopart 6 Srl Medeopart associates Srl Medeor Capital S.r.l. Rabofin Srl Romagna Acque Spa Sassuolo Gestioni Patrimoniali Srl Se.r.a. Srl catering service Serramazzoni Patrimonio Srl Sis Societ\u00e0 Intercomunale di Servizi Spa in liquidation Societ\u00e0 Italiana Servizi Spa - Sis Spa asset SOGEFI S.p.A. SPS S.r.l. Te.Am Srl Team Srl Unica Reti Spa - Asset Vanpart Srl Auditors, directors, strategic executives, family members of strategic executives ", "dimensions": { "concept": "ifrs-full:DisclosureOfRelatedPartyExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-69": { "value": "Subsidiaries Registered name Registered office Share capital (euro) (*) Consolidated percentage Total interest direct indirect Acantho Spa Imola (BO) 23,573,079 80.64% 80.64% AcegasApsAmga Spa Trieste 284,677,324 100.00% 100.00% AcegasApsAmga Servizi Energetici Spa Udine 11,168,284 100.00% 100.00% Alibardi Fiorenzo Srl Quinto di Treviso (TV) 100,000 100.00% 100.00% Aliplast Spa Istrana (TV) 5,000,000 75.00% 75.00% Aliplast France Recyclage Sas La Wantzenau (France) 1,025,000 75.00% 75.00% Aliplast Iberia SL Calle Castilla -Leon (Spain) 815,000 75.00% 75.00% Aliplast Polska Spoo Zgierz (Poland) 1,200,000 PLN 75.00% 75.00% Aresenergy Eood Varna (Bulgaria) 50,000 Lev 100.00% 100.00% AresGas Ead Sofia (Bulgaria) 22,572,241 Lev 100.00% 100.00% Ares Trading Eood Varna (Bulgaria) 50,000 Lev 100.00% 100.00% Asa Scpa Castelmaggiore (BO) 1,820,000 38.25% 38.25% Atlas Utilities Ead Varna (Bulgaria) 50,000 Lev 100.00% 100.00% Biorg Srl Bologna 10,000,000 75.00% 75.00% Black Sea Gas Company Eood Varna (Bulgaria) 5,000 Lev 100.00% 100.00% Con Energia Spa Forl\u00ec (FC) 500,000 100.00% 100.00% Eco Gas Srl Castel di Sangro (AQ) 100,000 100.00% 100.00% EstEnergy Spa Trieste 299,925,761 100.00% 100.00% Etra Energia Srl Cittadella (PD) 100,000 51.00% 51.00% Feronia Srl Finale Emilia (MO) 100,000 75.00% 75.00% Frullo Energia Ambiente Srl Bologna 17,139,100 38.25% 38.25% Green Factory Srl Pesaro 500,000 46.70% 46.70% Herambiente Spa Bologna 271,648,000 75.00% 75.00% Herambiente Servizi Industriali Srl Bologna 5,000,000 75.00% 75.00% Hera Comm Spa Imola (BO) 53,595,899 100.00% 100.00% Hera Comm Marche Srl Urbino (PU) 1,977,332 100.00% 100.00% Hera Luce Srl Cesena 1,000,000 100.00% 100.00% Hera Servizi Energia Srl Forl\u00ec 1,110,430 67.61% 67.61% Heratech Srl Bologna 2,000,000 100.00% 100.00% Hera Trading Srl Trieste 22,600,000 100.00% 100.00% HestAmbiente Srl Trieste 1,010,000 82.50% 82.50% Hydro Mud Srl Torrebelvicino (VI) 50,000 75.00% 75.00% Inrete Distribuzione Energia Spa Bologna 10,091,815 100.00% 100.00% Macero Maceratese Srl Macerata (MC) 1,032,912 46.70% 46.70% Marche Multiservizi Spa Pesaro 16,388,535 46.70% 46.70% Marche Multiservizi Falconara Srl Falconara Marittima (AN) 100,000 46.70% 46.70% Primagas AD Varna (Bulgaria) 1,149,860 Lev 97.34% 97.34% Recycla Spa Maniago (PN) 90,000 75.00% 75.00% Tri-Generazione Scarl Padua 100,000 70.00% 70.00% Uniflotte Srl Bologna 2,254,177 97.00% 97.00% Vallortigara Servizi Ambientali Spa Torrebelvicino (VI) 330,000 75.00% 75.00% Vallortigara Angelo Srl Torrebelvicino (VI) 80,000 75.00% 75.00% Wolmann Spa Bologna 400,000 100.00% 100.00% (*) unless otherwise specified Summary of key figures of the financial statements of subsidiaries pursuant to Article 2429, last paragraph, of the Civil Code. thous. \u20ac Acantho Spa AcegasApsAmga SpA* AcegasApsAmga Servizi Energetici Spa* Alibardi Fiorenzo Srl Aliplast Spa ASSETS Fixed assets 61,049 1,052,237 90,648 79 62,232 Circulating assets 34,335 166,743 258,843 649 85,456 Total assets 95,384 1,218,980 349,491 728 147,688 LIABILITIES Share capital 23,573 284,677 11,168 95 5,000 Reserves 10,579 273,331 31,809 301 27,190 Net profit /(loss) 5,883 21,955 16,281 75 35,226 Provisions 36 29,263 2,100 \u2010 1,128 Severance pay provision 637 11,013 1,033 1 673 Payables 54,676 598,741 287,100 256 78,471 Total liabilities 95,384 1,218,980 349,491 728 147,688 INCOME STATEMENT Production value 79,266 383,534 204,958 621 214,174 Production costs (70,029) (347,760) (188,771) (516) (168,825) Financial income/ (expenses) (591) (7,608) 4,260 \u2010 (1,415) Extraordinary income/ (expenses) \u2010 \u2010 \u2010 \u2010 \u2010 Taxes for the year (2,763) (6,211) (4,166) (30) (8,708) Net profit /(loss) 5,883 21,955 16,281 75 35,226 thous. \u20ac Aliplast France Recyclage Sarl Aliplast Iberia Sl Aliplast Polska SP O.O AresGas Ead Aresenergy Eood ASSETS Fixed assets 3,423 640 372 83,448 10 Circulating assets 2,792 1,256 1,368 7,250 584 Total assets 6,215 1,896 1,740 90,698 594 LIABILITIES Share capital 1,025 815 256 11,541 26 Reserves 527 84 623 16,861 (215) Net profit /(loss) 432 92 230 1,215 63 Provisions \u2010 \u2010 \u2010 26 \u2010 Severance pay provision \u2010 \u2010 \u2010 25 \u2010 Payables 4,231 905 631 61,030 720 Total liabilities 6,215 1,896 1,740 90,698 594 INCOME STATEMENT Production value 7,871 2,557 6,010 68,302 2,101 Production costs (7,424) (2,460) (5,724) (65,744) (2,023) Financial income/ (expenses) (15) \u2010 5 (1,167) (15) Extraordinary income/ (expenses) \u2010 26 \u2010 \u2010 \u2010 Taxes for the year \u2010 (31) (61) (176) \u2010 Net profit /(loss) 432 92 230 1,215 63 thous. \u20ac Con Energia Spa Eco Gas Srl EstEnergy Spa* Etra Energia Srl* Feronia Srl ASSETS Fixed assets 196 125 515,002 87 2,746 Circulating assets 19,671 9,708 631,806 5,421 2,884 Total assets 19,867 9,833 1,146,808 5,508 5,630 LIABILITIES Share capital 500 100 299,926 100 100 Reserves 6,272 1,880 259,501 1,071 1,160 Net profit /(loss) 699 695 21,376 506 (498) Provisions 4 \u2010 4,997 \u2010 4,141 Severance pay provision 140 104 2,185 66 \u2010 Payables 12,253 7,054 558,823 3,765 727 Total liabilities 19,867 9,833 1,146,808 5,508 5,630 INCOME STATEMENT Production value 28,361 17,358 1,414,473 15,831 316 Production costs (27,435) (16,416) (1,387,711) (15,128) (996) Financial income/ (expenses) 44 55 1,390 9 \u2010 Extraordinary income/ (expenses) \u2010 \u2010 \u2010 \u2010 \u2010 Taxes for the year (271) (302) (6,776) (206) 182 Net profit /(loss) 699 695 21,376 506 (498) thous. \u20ac Frullo Energia Ambiente Srl* Green Factory Srl Hera Comm Marche Srl* Hera Comm Spa* Hera Luce Srl* ASSETS Fixed assets 49,574 3,797 21,501 721,542 113,631 Circulating assets 32,864 662 62,402 2,132,308 68,624 Total assets 82,438 4,458 83,903 2,853,850 182,255 LIABILITIES Share capital 17,139 500 1,977 53,596 1,000 Reserves 26,248 (39) 13,165 389,687 54,264 Net profit /(loss) 17,040 (16) 962 30,268 6,723 Provisions 2,625 \u2010 \u2010 7,139 105 Severance pay provision 1,442 \u2010 653 3,493 625 Payables 17,943 4,014 67,146 2,369,668 119,538 Total liabilities 82,438 4,458 83,903 2,853,850 182,255 INCOME STATEMENT Production value 48,359 \u2010 164,802 7,179,599 108,786 Production costs (24,972) (16) (160,213) (7,186,957) (102,284) Financial income/ (expenses) (103) \u2010 104 40,215 2,292 Extraordinary income/ (expenses) \u2010 \u2010 \u2010 \u2010 \u2010 Taxes for the year (6,243) \u2010 (3,732) (2,590) (2,071) Net profit /(loss) 17,040 (16) 962 30,268 6,723 thous. \u20ac Hera Servizi Energia Srl Hera Trading Srl* Herambiente Servizi Industriali Srl* Herambiente Spa* Heratech Srl* ASSETS Fixed assets 75,770 2,794 142,316 1,040,138 156 Circulating assets 489,248 4,187,303 64,178 373,642 67,945 Total assets 565,019 4,190,097 206,494 1,413,781 68,101 LIABILITIES Share capital 1,110 22,600 5,000 271,600 1,981 Reserves 19,854 201,950 20,174 80,570 4,964 Net profit /(loss) 29,330 1,533 5,366 34,048 3,576 Provisions 12,791 \u2010 5,410 164,293 44 Severance pay provision 860 603 2,629 6,509 5,090 Payables 501,074 3,963,411 167,915 856,761 52,44 Total liabilities 565,019 4,190,097 206,494 1,413,781 68,101 INCOME STATEMENT Production value 455,369 16,454,417 164,890 497,454 180,591 Production costs (403,636) (16,448,731) (164,283) (449,635) (175,029) Financial income/ (expenses) (10,641) (3,910) 1,019 (5,907) \u2010 Extraordinary income/ (expenses) - \u2010 \u2010 \u2010 (452) Taxes for the year (11,763) (242) 3,740 (7,863) (1,535) Net profit /(loss) 29,330 1,533 5,366 34,048 3,576 thous. \u20ac HestAmbiente Srl* Hydro Mud Srl Inrete Distribuzione Energia Spa* Macero Maceratese Srl Marche Multiservizi Spa ASSETS Fixed assets 101,234 48 1,313,364 6,082 253,277 Circulating assets 24,076 782 198,821 8,021 79,192 Total assets 125,310 830 1,512,185 14,103 332,469 LIABILITIES Share capital 1,010 50 9,901 1,033 16,389 Reserves 18,547 406 564,318 4,850 106,183 Net profit /(loss) 10,317 230 37,516 965 15,319 Provisions 5,887 \u2010 128,219 183 38,360 Severance pay provision 589 12 7,969 485 5,364 Payables 88,960 132 764,262 6,587 150,855 Total liabilities 125,310 830 1,512,185 14,103 332,469 INCOME STATEMENT Production value 80,293 764 364,333 16,994 145,797 Production costs (64,383) (448) (298,140) (15,370) (124,639) Financial income/ (expenses) (1,835) \u2010 7 (75) (392) Extraordinary income/ (expenses) \u2010 \u2010 (15,639) (157) \u2010 Taxes for the year (3,758) (85) (13,046) (426) (5,447) Net profit /(loss) 10,317 230 37,516 965 15,319 thous. \u20ac Marche Multiservizi Falconara Srl Primagas AD Recycla Spa Tri-Generazione Srl* Uniflotte Srl* ASSETS Fixed assets 2,703 2,301 13,160 \u2010 121,384 Circulating assets 2,596 1,195 11,310 862 30,536 Total assets 5,300 3,496 24,470 862 151,920 LIABILITIES Share capital 100 588 90 100 2,254 Reserves 561 340 6,514 289 27,885 Net profit /(loss) 274 460 3,903 \u2010 3,896 Provisions 236 \u2010 636 \u2010 \u2010 Severance pay provision 883 \u2010 1,045 \u2010 1,562 Payables 3,246 2,108 12,282 473 116,323 Total liabilities 5,300 3,496 24,470 862 151,920 INCOME STATEMENT Production value 8,212 6,370 24,032 1,173 99,947 Production costs (7,811) (5,837) (18,792) (990) (93,226) Financial income/ (expenses) (7) (28) (64) (174) (2,292) Extraordinary income/ (expenses) \u2010 \u2010 \u2010 \u2010 \u2010 Taxes for the year (120) (45) (1,273) (9) (533) Net profit /(loss) 274 460 3,903 \u2010 3,896 thous. \u20ac Vallortigara Angelo Srl Vallortigara Servizi Ambientali Spa Wolmann Spa ASSETS Fixed assets 879 10,668 308 Circulating assets 4,202 11,690 18,591 Total assets 5,081 22,358 18,899 LIABILITIES Share capital 80 330 400 Reserves 3,095 9,481 (663) Net profit /(loss) 380 2,242 1,354 Provisions 8 195 46 Severance pay provision 360 506 109 Payables 1,159 9,602 17,653 Total liabilities 5,081 22,358 18,899 INCOME STATEMENT Production value 6,048 26,758 21,342 Production costs (5,656) (24,227) (19,263) Financial income/ (expenses) 17 477 (255) Extraordinary income/ (expenses) \u2010 \u2010 (46) Taxes for the year (28) (765) (424) Net profit /(loss) 380 2,242 1,354 *The company applies the international accounting standards, therefore the values stated comply with them. ", "dimensions": { "concept": "ifrs-full:DisclosureOfSignificantInvestmentsInSubsidiariesExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "fact-70": { "value": "OUTLINE OF ARTICLE149 DUODECIES OF THE CONSOB ISSUER\u2019S REGULATION thous. \u20ac 2022 Services provided to certify the financial statements 1,068 Provision of other services for the issue of an attestation by the independent auditor company 365 Provision of other services by the independent auditor 86 Total 1,519 2.06 ", "dimensions": { "concept": "ifrs-full:DisclosureOfAuditorsRemunerationExplanatory", "language": "it", "entity": "scheme:8156009414FD99443B48", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } } } }