Operating segments and objectives of the 2016-2020 business plan

The 2016-2020 Business Plan confirms the focus of the Company’s strategy on innovation, service quality, regulated business, efficiency and the rationalisation of internal processes. Furthermore, the plan envisages an acceleration and expansion of efficiency objectives, especially with reference to the Acea 2.0 project. Capital expenditures for the five-year period amount to 2.4 billion euros.

The main strategic lines of the new Business Plan include:

1 Growth and consolidation of regulated activities (currently 77% of consolidated EBITDA).

2 Improvement of service quality and customer focus, through technological innovation and an expansion of contact channels.

3 Strong commitment to organizational and operational efficiency by introducing, among other things, the Work Force Management.

4 Consolidation and development of waste treatment and composting plants.

5 Optimization of working capital and improvement of financial ratios.

6 Sustainable development in both environmental and financial terms.

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Water segment

The ACEA Group is a major player in the Italian water sector in terms of volumes supplied and population served. The Group manages the integrated water service in Rome and Frosinone and in the respective provinces, as well as in other parts of Lazio, in Tuscany, Umbria and Campania.

OBJECTIVES - 2016-2020 BUSINESS PLAN
CAPITAL EXPENDITURES: 1,042 million euros

1 Acea 2.0 Project: radical transformation, increase of process efficiency, optimization of operating costs through the launch of the Work Force Management in September 2015

2 Modernization of the network through the introduction of new technologies and the improvement of waste water treatment

3 Development abroad, especially in Latin America

EBITDA +6,4%

2015

310.8

2014

292.2

Amounts in millions of euros

CAPITAL EXPENDITURES +37,3%

2015

204.4

2014

148.9

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Energy segment

The ACEA Group is a major operator in Italy in the sale of electricity, with a market share of 4%. The Group operates in the energy generation sector through hydroelectric and thermoelectric plants in Lazio, Umbria and Abruzzo.

OBJECTIVES - 2016-2020 BUSINESS PLAN
CAPITAL EXPENDITURES: 159 million euros

1 Improving service quality

2 Acea 2.0 Project: introduction of a new billing and CRM system; increased process efficiency and optimization of overhead costs

3 Modernization of the production facilities in Castel Madama and Mandela

4 Development of energy efficiency projects

EBITDA (3,3%)

2015

107.9

2014

111.6

Amounts in millions of euros

CAPITAL EXPENDITURES +55,3%

2015

30.6

2014

19.7

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Networks segment

The ACEA Group is among the major operators in Italy in the distribution of electricity. In Rome the Group manages the electricity distribution networks and the public and artistic lighting.

OBJECTIVES - 2016-2020 BUSINESS PLAN
CAPITAL EXPENDITURES: 878 million euros

1 Acea 2.0 Project: improving service quality and cost efficiency

2 Continuing the modernization of the Rome distribution network towards the implementation of a "Smart City"

3 Development of public lighting activities

EBITDA +0,9%

2015

255.7

2014

253.3

Amounts in millions of euros

CAPITAL EXPENDITURES +27,6%

2015

156.2

2014

122.4

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Environment segment

The ACEA Group is the 6th largest operator in terms of volumes of treated waste with a 2.4% market share and is the 1st operator in Italy in the management of composting plants.

OBJECTIVES - 2016-2020 BUSINESS PLAN
CAPITAL EXPENDITURES: 262 million euros

1 3rd Italian operator by 2020 following the expansion of existing plants

2 Consolidation of its position in the Lazio region following the upgrading of the San Vittore plant

3 Construction of a new composting plant with anaerobic digestion

4 Expansion of the Orvieto landfill

5 Expansion and upgrading of composting and sludge conditioning plants

EBITDA +5,3%

2015

57.4

2014

54.5

Amounts in millions of euros

CAPITAL EXPENDITURES +94,7%

2015

25.9

2014

13.3