Eni S.p.A. Q2 FY2025 earnings call

• Strong strategic progress in upstream with exploration successes, including ~600 million barrels of oil equivalent new resources discovered in first half, and significant further activity in second half.
• Transition businesses like Enilive, Plenitude, and CCUS are advancing; Enilive saw EBITDA improvement, Plenitude has growing renewable capacity, and CCUS activities have exclusivity agreements.
• Versalis transformation plan is underway with closures of steam crackers to address losses, expected to deliver turnaround in EBIT.
• Q2 results broadly in line with guidance; upstream production and EBIT in line, GGP benefited from contract renegotiation, transition businesses on track, Versalis improving but still loss-making.
• Partnership with Petronas in Indonesia and Malaysia for upstream satellite project, with targets for FIDs and production growth.

Upstream: Production was 1.67 million barrels per day in line with guided range. EBIT for the quarter was around EUR 1.7 billion. GGP: Result benefited from positive effect of contract renegotiation, full year pro forma EBIT now expected to be around EUR 1 billion. Enilive: Saw improvement in EBITDA versus Q1, almost unchanged year-over-year. Plenitude: Supported by retail business and continued progress in renewable production. Versalis: Results improved quarter-on-quarter but remained significantly loss-making.

• Expect CFFO to grow by around 40% by 2030 and materially improve return on capital employed.
• 2025 CFFO expected to be EUR 11.5 billion, EUR 0.5 billion higher than Q1 outlook and EUR 0.5 billion higher on underlying basis than original guidance.
• Aim to keep company pro forma leverage between 15% and 20% in 2025 within planned range.
• Anticipate positive second half of 2025 and promising 2026 based on operational momentum and live deals.

• Arbitration ongoing with competitors related to GGP contracts poses uncertainty.
• Uncertainties in asset sales timings and project progress, such as with the Vitol deal.
• Market volatility and challenges in the chemical sector recovery could impact results.

Q: On GGP contract with Venture Global and arbitration, how is Eni's confidence in the contract volumes appearing as promised?

A: Guido Brusco states they rely on Venture Global's project ability to deliver modular plant as done before, and the contract is complementary to their portfolio.

Q: On satellite businesses like Enilive and Plenitude, any guidance on minority dividends?

A: Francesco Gattei says they do not disclose minority dividend details for now but may provide further details in future.

Q: On asset sale to Vitol, any sense of adjustment to the headline price?

A: Francesco Gattei says the consideration will be adjusted for production and investment amounts at closing.

Q: On succession planning, any comment on Claudio Descalzi's presence from 2026?

A: Claudio Descalzi states Eni is strong due to its team and culture, and there is a succession plan in place but no immediate concern.

Q: On YPF Argentina project, what's needed for FID?

A: Guido Brusco says steps include final project configuration, field development plans, commercial and offtake agreements, and project financing, expected to finalize by end of year or beginning of next year.

Q: On buyback, what could cause reassessment?

A: Claudio Descalzi says if the execution of strategy continues positively and balance sheet remains strong, there is potential to improve buyback, but will be clear in next months.

Q: On EUR 3 billion cash management, how easy was it and potential for more savings?

A: Francesco Gattei says it's about reorganizing and using just-in-time logic to optimize cash, and there are potential for more savings through similar efficiency measures.

Q: On Plenitude timeline to cash flow neutral, when?

A: Stefano Goberti says Plenitude is a growth company, expects cash flow to turn positive between 35-40, before reaching 10 gigawatts capacity.

Q: On Indonesia project uplift to 2026 production, any details?

A: Claudio Descalzi says it's a transformational project but exact figures will be clarified in February when presenting 4-year plan.

Q: On Versalis restructuring milestones, when will key effects be seen?

A: Adriano Alfani says second half of 2025 will see ~EUR 90-100 million impact, with significant effect from second half of 2026 onwards.

Q: On biofuels market dynamics, any demand uplift from Germany's new proposals?

A: Stefano Ballista says Germany's new proposals could lead to ~1.5 million tonnes demand uplift.