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Investing.com -- Shares of Italgas S.p.A. (BIT:IG) rose more than 3% on Thursday after the Italian gas distributor confirmed a 10% compound annual growth rate in earnings per share and announced €16.5 billion in investments under its 2025-2031 strategic plan.
The company outlined investment allocations of €13.2 billion for Italian gas distribution, €1 billion for its Greek operations, €1.5 billion for tenders, and €0.8 billion for water and energy efficiency projects.
The total investment plan represents a 5.7% increase from the previous strategic plan, or 10.2% excluding the effects of the 2i Rete Gas acquisition and tenders.
Italgas projected that its total gas distribution regulated asset base, excluding tenders, will reach €18.9 billion by 2031, marking a 9.2% compound annual growth rate compared with €18.2 billion projected for 2030 under the prior plan.
The company also expects cost synergies from the 2i Rete Gas integration to total €250 million, up from a previous estimate of €200 million.
Italgas forecasts a €100 million annual positive impact on revenue from digitization investments, compared with the prior assumption of €80 million per year.
Leverage, measured as net debt to regulated asset base, is expected to peak in 2025, fall below 65% by 2028, and reach 60% in 2031.
The company said it expects to achieve a leverage level consistent with rating agency commitments nearly a year earlier than indicated in its previous plan.
For 2031, Italgas forecasts earnings before interest, taxes, depreciation and amortization of about €3.0 billion and EBIT of €2 billion, reflecting a 12% CAGR for EBITDA between 2024 and 2031.
The plan also confirmed an EPS CAGR of 10% over the same period. For 2029, Italgas guided for approximately €2.7 billion in EBITDA and €1.8 billion in EBIT.
For 2025, the company raised its adjusted EBITDA forecast to around €1.87 billion from a previous range of €1.80 billion to €1.85 billion, and its adjusted EBIT to about €1.19 billion from a prior range of €1.12 billion to €1.16 billion.
Technical investments were maintained at about €1.2 billion, and net debt excluding IFRS 16 effects was projected at about €10.8 billion. The earlier guidance was based on the planned sale of 600,000 redelivery points at the start of 2026.
Italgas confirmed its dividend policy through 2028, stating that annual payouts will be based on “the higher of 2024 DPS (€0.406 per share) increased by 5% annually or a 65% payout.” The previous floor had been tied to the 2023 dividend, according to the analysts at RBC Capital Markets in a note.
In its nine-month results for 2025, Italgas reported adjusted EBITDA of €1.369 billion, up 36% from the same period a year earlier, and adjusted net income of €495 million, a 37% increase. Net debt stood at €10.993 billion, in line with market expectations.