We have built a new Eni based on efficiency, integration and the deployment of new technologies, developed at our Research Centres. The following infographic summarizes the main results obtained for each target and the strategies to achieve them.
How the change began
Starting from 2014, we have transformed Eni into a stronger and leaner company, able to grow even in a volatile prices scenario. Efficiency and integration have always been our guiding values.
Technological innovation is an essential part of our DNA and the application proprietary technologies is our distinctive factor.
Decarbonisation, sustainability and circular economy have become integral parts of our business.
Management took decisive actions according to three priorities:
- Health and safety of our people and asset integrity: implemented initiatives to safeguard each of the 60 thousand people that work in Eni and with Eni, in all the work places and operational sites. Very quickly, smart working was adopted by 99% of Eni employees in the main offices and by 70% of people engaged in our operational sites. These measures allowed to ensure continuity, without operational interruptions and asset integrity.
- Robustness of balance sheet: during the pandemic peak, management took decisive actions to increase the financial resiliency and strengthen the balance sheet, defining clear priorities in cash allocation. The Company is set to resume growing once the macro backdrop normalizes. Revised the Company’s strategy and plans for the short-to-medium term leveraging on a reduction of €8 billion in the outlays for expenses and capital expenditures in the two-year period 2020-2021, more exposed to the downturn, with the subsequent reshaping of the growth profile of production and the definition of a dividend policy based on a fixed component, subject to a continuous re-evaluation process, following the achievement of certain Eni’s industrial targets and a variable component indexed to the scenario, in order to adapt the dividend to market volatility; the share buy-back program is temporarily suspended.
- Organizational structure: in June 2020, Eni created a new organizational setup by establishing two business groups: the Natural Resources business which has the task of valorizing the Oil & Gas portfolio in a sustainable way and of managing the energy efficiency activities, the projects of CO2 capture; and the Energy Evolution business which has the task of managing the evolution of businesses of power generation, manufacturing and marketing of products from fossil to bio, blue and green. The two business groups will work in synergy with R&D and digitalization department to realize Eni’s plans and achieve the decarbonization targets to 2050. Thanks to these actions, notwithstanding the significant impact of pandemic crisis on Group’s cash flow, in 2020 the adjusted cash flow of €6.7 billion was able to finance 100% of net organic capex lowered to €5 billion (down by 35% vs. the original budget at constant exchange rates) due to the implemented optimizations, with a surplus of €1.7 billion. Opex were reduced by €1.9 billion compared to the pre-COVID-19 level, of which about 30% is structural. As of December 31, 2020, leverage was confirmed at 0.3 and net borrowings were in line with the comparative period, also due to the issuance of two hybrid bonds for €3 billion.
2020: FAST REACTION TO COVID-19 CRISIS
|PEOPLE HEALTH AND BUSINESS CONTINUITY|
>35% capex reduction vs. original 2020 guidance
-€1,9 bln cost savings vs. pre‐COVID-19 level
FID rescheduling on large upstream projects
Increased capex on green project
Leverage* in the comfort zone at about 0.3
First issuance of hybrid bonds of €3 bln
|NEW COMPANY ORGANIZATION|
|LONG-TERM DECARBONIZATION PLAN|
Read more about our transformation
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