Report and financial statements
of Enel SpA at December 31, 2022
OPEN
POWER
FOR A
BRIGHTER
FUTURE.
WE EMPOWER
SUSTAINABLE
PROGRESS.
We live in an increasingly interconnected world
where the companies that will continue to thrive in the long
run will be those able to act collectively, creating and sharing
value with all stakeholders. This is what the graphic design
of the Enel Group's Corporate Reporting expresses through
the development of connected and balanced forms. Elements
inspired by nature, whose movement offers a narration
of harmony, growth and evolution.
OPEN
POWER
FOR A
BRIGHTER
FUTURE.
WE EMPOWER
SUSTAINABLE
PROGRESS.
Report and financial statements
of Enel SpA at December 31, 2022
PURPOSE
Enel is Open Power
VISION
Open Power to tackle some
of the world’s biggest
challenges.
POSITIONING
Open Power
4 Report and financial statements of Enel SpA at December 31, 2022
VISION
Open Power to tackle some
of the world’s biggest
challenges.
PRINCIPLES OF CONDUCT
• Make decisions in daily activities and take
responsibility for them.
• Share information, being willing to collaborate
and open to the contribution of others.
• Follow through with commitments, pursuing activities
with determination and passion.
• Change priorities rapidly if the situation evolves.
• Get results by aiming for excellence.
• Adopt and promote safe behavior and move proactively
to improve conditions for health, safety and well-being.
• Work for the integration of all, recognizing and leveraging
individual diversity (culture, gender, age, disabilities,
personality, etc.).
• Work focusing on satisfying customers and/or coworkers,
acting effectively and rapidly.
• Propose new solution and do not give up when faced
with obstacles or failure.
• Recognize merit in co-workers and give feedback
that can improve their contribution.
VALUES
• Trust
• Proactivity
• Responsibility
• Innovation
MISSION
• Open access to electricity
for more people.
• Open the world of energy
to new technology.
• Open up to new uses of energy.
• Open up to new ways of managing
energy for people.
• Open up to new partnerships.
5
Letter
to shareholders
and other
stakeholders
Dear shareholders and stakeholders,
During 2022, the Enel Group pursued with
determination its growth strategy along
the lines of increasingly decarbonized
electrification to guarantee its customers
competitive prices, sustainability and energy
security.
Enel confirms its position as the largest
private operator in the renewable energy
sector in the world, having reached around
59 GW of managed capacity with the plants
built this year. It is also the largest private
electricity distributor globally, with around 73
million end users connected to increasingly
digital grids, with around 63% of users
equipped with smart meters. Furthermore,
the Group manages the largest customer
base among private companies, with about
67 million customers.
Our business model, entirely based on digital
platforms, allows the Group to optimally
seize the opportunities generated by the
energy transition now under way at the
global level.
The Group’s financial performance in 2022
demonstrated our resilience even in highly
volatile and adverse environments, such as
that characterizing the year just ended.
The Group’s leadership in sustainability has
once again been recognized worldwide,
underscored by its constant presence in
various major sustainability rankings and
indices.
73 million
End users
59 GW
Renewables
capacity managed
6 Report and financial statements of Enel SpA at December 31, 2022
The macroeconomic environment
After a strong post-pandemic recovery, the global
macroeconomic environment in 2022 experienced
a generalized slowdown in the real economy, with
global GDP growth of around 3% on an annual basis.
The world economies were impacted by sudden and
growing inflationary pressures that forced many central
banks to rapidly tighten their monetary policies, with a
consequent impact on the financial markets. The military
conflict between Russia and Ukraine, and the resulting
global uncertainty, has also aggravated conditions on
the energy, commodity and food markets, with direct
repercussions on the prices of final consumer goods.
In the United States, the real economy was heavily
affected by growing inflationary pressures, which
prompted the Federal Reserve to implement rapid
increases in its benchmark interest rate. In the euro area,
the 1st Half of the year witnessed an economic recovery
that outpaced expectations, while in the 2nd Half, with
the emergence of the great uncertainty engendered
by the hostilities between Russia and Ukraine and
the sudden increase in energy prices, the European
economies saw growth slow significantly. The European
Central Bank also decided to rapidly adjust its monetary
policy stance, with multiple increases in its benchmark
rates.
In Latin America, the macroeconomic context was
characterized by two different phases. The 1st Half of the
year saw a significant post-pandemic recovery, while in
the 2nd Half the economies of the area experienced the
rapid and large high increase in international commodity
prices, mainly driven by the conflict between Russia and
Ukraine. National central banks responded by tightening
their monetary policies, which, as a result, dampened the
economic recovery.
On the energy front, in 2022 the European gas market
experienced substantial volatility. The sharp rise in
prices, which saw the TTF (Title Transfer Facility) index
exceed €300/MWh during August, was caused by the
supply uncertainty of flows from Russia, which steadily
decreased over the past year. The achievement of high
storage filling percentages achieved before the winter
season, together with temperatures that exceeded
seasonal averages in November and December,
subsequently led to a sharp fall in European gas prices in
the closing months of 2022.
The rise in gas prices and a number of hitches along
the supply chain in turn led to an increase in coal prices,
which in 2022 reached an average of $290/t.
The quotations of CO
2
within the ETS (Emission Trading
System) also increased, rising by over 50% compared
with the previous year, despite the slowdown in
economic activity in the 4th Quarter.
The bullish dynamics on the commodity markets
produced a sharp increase in electricity prices
Francesco Starace
Chief Executive Officer
and General Manager
Michele Crisostomo
Chairman
7Letter to shareholders and other stakeholders
throughout Europe, which in the case of Italy and Spain
exceeded 140% and 50%, respectively, compared with
2021.
As had occurred in 2021, 2022 was also characterized
by pronounced volatility in the industrial metals sector,
albeit with different dynamics. The 1st Half of the year
was characterized by unexpected peaks and sharp
increases in prices, mainly for aluminum and nickel. In
the 2nd Half, however, fears for the short-term growth
outlook dominated, with a partial reversal of benchmark
prices compared with the peak recorded in the 1st Half.
Performance
In 2022, the Enel Group continued its growth path
despite the turbulence associated with the volatility of
the prices of commodities and raw materials.
In particular, the 2022 financial year closed with ordinary
EBITDA of €19.7 billion, an increase of 3% compared with
2021. Ordinary profit amounted to €5.4 billion, down
about 4% compared with the previous year. The dividend
for 2022 amounts to €0.40 per share, up 5% compared
with 2021. In terms of cash generation, FFO in 2022
amounted to about €9.1 billion. Net debt amounted
to €60.1 billion, down €9.6 billion compared with
September 30, 2022.
Main developments
As in previous years, in 2022 Enel once again achieved
a new record for generation capacity from renewable
sources, globally building 5,223 MW of new renewables
capacity, including 387 MW of BESS.
With the plants built in 2022, installed renewable
capacity, including batteries, reached about 59 GW,
producing a total of about 124 TWh of power from
renewable sources over the year, of which about 66 TWh
from wind and sun, about 52 TWh from hydroelectric
and about 6 TWh from geothermal.
The pipeline of projects under development in 2022 also
set a record, with 462 GW, inclusive of renewable energy
plants, batteries capacity and capacity already under
construction, an increase of around 24% compared
with the previous year. At the same time, the process of
decommissioning and conversion of coal-fired plants
continues.
As a result, the Group’s specific greenhouse gas
emissions linked to electricity generation in 2022
amounted to 229 gCO
2eq
/kWh, in line with the objectives
certified by the Science Based Target initiative (SBTi) in
accordance with the path to limit the increase in global
temperature to 1.5 °C.
In 2022, the creation of digital platforms was also
completed. Using advanced analytics and artificial
intelligence algorithms, these will analyze more than
50 million data points on a daily basis to optimize the
management of our wind and solar plants throughout
their entire life cycle, from design and construction to
operation and maintenance.
2022 was also a crucial year for the opening of the 3Sun
Gigafactory construction site in Sicily. The project will
increase the production of photovoltaic panels at the
current factory from 200 MW per year to 3 GW by 2024,
raising efficiency standards while improving the reliability
and sustainability of the panels produced. A journey
that began more than fifteen years ago and which will
help make a substantial contribution to the revival of
the photovoltaic industry in Italy and Europe, giving the
country a position on a strategic supply chain for the
energy transition.
Enel’s strong commitment to electricity grids, which
are enablers and protagonists of the energy transition,
also continues. Thanks to the investment in their
modernization and their even greater digitalization,
63% of the Group’s end users are equipped with smart
meters, while a total of about 65 GW of distributed
renewable energy, more than half of which in Italy, is
connected to our grids.
The digital transformation continues through the
adoption of a platform operating model based on
advanced technological solutions that impact all
operating processes – from the design and construction
of new grid infrastructure to the optimization of
operating and maintenance activities and managing the
relationship with customers. The volume of electricity
distributed worldwide was 508 TWh, constantly
improving the quality of service rendered to our
customers.
2022 was also a crucial year for the development and
growth of the NewCo Gridspertise, launched in 2021
with the aim of making Enel’s innovative solutions in the
smart meter field available to third-party distribution
companies to accelerate the energy transition.
The strong commitment of the Group to the
development of the electricity distribution infrastructure
8 Report and financial statements of Enel SpA at December 31, 2022
serving Italy is confirmed once again this year.
Developments in this regard include the successful
participation in the two tenders under the NRRP relating
to Smart Grids and Grid Resilience, with the award of
around €3.5 billion to e-distribuzione, and the success
of the Energy for Growth project, with the training of
2,500 people a year once fully operational.
Following the birth of Enel X Global Retail, a new
organizational model was defined among the various
countries to better develop and manage the increasingly
integrated, innovative and sustainable solutions that
use the commodity as a competitive lever. Enel X Global
Retail focuses on the electrification of consumption,
studying its effective benefits for customers with the aim
of defining a strategy for acceleration at the global level,
leveraging about 67 million customers.
Through the new Global e-Mobility Business Line we are
accelerating the electrification of transport thanks to
the strategic focus and the strengthening of the offering
and the operating model. This has enabled a significant
increase in commercial performance in terms of
charging points sold (around 92 thousand in 2022, +82%
compared with 2021) and charging services provided (43
GWh in 2022, +134% compared with 2021).
In order to ensure that we take a customer-centric
approach to all processes, a recurring customer
satisfaction survey system was consolidated in 2022
through the continuous measurement on a global
scale of the Group Net Promoter Score.
(1)
In 2022,
Global Customer Operations received around 1 million
feedbacks, which made it possible to define and
guide improvement initiatives to make the customer
experience increasingly simple, intuitive and effective.
One result was a 34% reduction in commercial
complaints compared with the previous year.
On the financial front, Enel issued “sustainability-linked”
bonds in euros, US dollars and British pounds in a total
amount equivalent to about €12.1 billion. These issues
are linked to the achievement of Enel’s sustainability
objective for the reduction of direct greenhouse gas
emissions (Scope 1) and also contribute to achievement
of the United Nations Sustainable Development Goal
(SDG) 13 (“Climate Action”). For the first time ever for
a multinational energy group, a bond linked to full
decarbonization was issued, in line with the Group’s goal
of achieving zero direct greenhouse gas emissions by
2040.
(1) The Net Promoter Score (NPS) is calculated as the percentage of “promoters” less the percentage of “detractors” (score between 0 and 6 out of 10). The
values therefore lie in a range of -100 to +100 (NPS = % Number of Promoters - % Number of Detractors).
The bond issue programs have made it possible to
achieve a ratio between sustainable funding sources and
the Group’s total gross debt of about 63%.
Furthermore, on December 22, 2022, Enel obtained a
€12 billion revolving credit line dedicated to funding the
collateral requirements for trading activities on energy
markets. This financing operation, the effectiveness
of which is subject to the signing of an implementing
decree by the competent ministries, falls within the
framework of the measures made available to all
energy companies based in Italy that meet specific
characteristics in order to ensure, in the current
environment of high volatility in the energy markets, the
effective operation of the market on equal terms with
other European operators in the sector.
Among extraordinary transactions, in January 2022
the subsidiary Enel Produzione SpA completed the
acquisition of the entire share capital of ERG Hydro Srl,
owner of hydroelectric plants located in central Italy with
an installed capacity of 527 MW and an average annual
output of about 1.5 TWh.
In March 2022, Enel X International Srl renewed its
partnership with the private equity fund Cinven in Ufinet
Latam, having acquired 79.4% of the share capital of
Ufinet Latam SLU from Sixth Cinven Fund and at the
same time sold 80.5% of the share capital of the same
company to Seventh Cinven Fund, ending up with an
indirect stake of 19.5% of the share capital.
In October 2022, Enel completed the closing for the sale
of its entire stake in PJSC Enel Russia, equal to 56.43% of
the latter’s share capital, to PJSC Lukoil and the Closed
Combined Mutual Investment Fund “Gazprombank-
Frezia”, thus completing the divestment of all its
electricity generation assets in Russia.
In December 2022, a) Enel completed, through Enel
Grids Srl, the sale of 50% of the subsidiary Gridspertise
Srl to the private equity fund CVC Capital Partners Fund
VIII, following which Enel and CVC now exercise joint
control over the company; b) the subsidiary Enel Chile
SA completed the sale of the entire investment, equal
to 99.09% of the share capital, held in Enel Transmisión
Chile SA, a Chilean electricity transmission company,
to Sociedad Transmisora Metropolitana SpA; and c)
the subsidiary Enel Brasil SA completed the sale of its
entire stake held in the Brazilian electricity distribution
company Celg Distribuição SA – Celg-D, equal to
about 99.9% of the latter’s share capital, to Equatorial
Participações e Investimentos SA.
9
Letter to shareholders and other stakeholders
Strategy and forecasts for 2023-2025
The combined effect of two years of the COVID-19
pandemic, geopolitical tensions and extreme weather
events related to climate change has increased the
need for an acceleration in the energy transition and
digitalization, together with the reorganization and
rebalancing of global supply chains.
The current situation underscores the need to achieve
certain objectives in terms of accessibility, safety and
sustainability. To achieve these objectives, over the
course of the Plan, the Group plans to focus on an
integrated business model targeted at the sustainable
electrification of energy consumption, an increasingly
necessary step in global energy systems, supplying
about 90% of fixed-price sales in the core countries with
zero-emission electricity in 2025, bringing generation
from renewable sources to around 75% of the total, and
digitalizing about 80% of grid customers.
The consequence of the strategy focused on the
integrated margin is the particular attention to the
countries where the Group's presence covers the entire
value chain in order to fully seize the opportunities
associated with the energy transition. In this context, the
process that began years ago towards the disposal of
the assets no longer aligned with our strategy is reaching
completion, with planned disposals of around €21 billion
over the 2022-2024 period in terms of the positive
contribution to the reduction of the Group’s net debt. The
majority of this plan is expected to be completed by the
end of 2023, completing the path towards a more agile
corporate structure, focused on the six core countries
(Italy, Spain, United States, Brazil, Chile and Colombia).
The Group intends to ensure growth and financial
strength by combining a compound annual growth rate
(“CAGR”) of 9-10% in ordinary profit with an expected
FFO/net debt ratio of 28% starting in 2023, as well as
maintaining a fixed DPS of €0.43 in 2023-2025, an
increase on the €0.40 paid in 2022. In addition, the DPS
for 2024 and 2025 is to be considered a sustainable
minimum, not a maximum.
The Group confirms the use of two different business
models: the Ownership model, in which the Group
directly invests in renewables, grids and customers,
and the Stewardship model, in which the Group invests
capital in existing businesses, newly established
enterprises or acquiring minority stakes, in order to
maximize the value of the know-how developed in
the various businesses. These models will be applied,
depending on the geographical area and the operational
context, to achieve the defined objectives.
The Group’s investments in 2023-2025 will amount to
about €37 billion. More than 80% will be aligned with
the criteria of the European taxonomy, as they relate to
activities that contribute to the mitigation of climate
change thanks to the strong contribution of investments
in renewables, the connection of distributed generation
to the grid and advanced services for industrial and
private customers.
Some 60% of the Group’s investments, of which about
50% in generation and about 10% in advanced energy
customers and services, are expected to support the
Group’s integrated commercial strategy, with grids
accounting for about 40% of investments over the
period covered by the Strategic Plan. At the country
level, about 85% of these investments are expected to
be allocated to Italy, Spain and the United States, where
the Group can also benefit from policies to support
sustainable electrification introduced by the EU and the
United States.
By 2025, the Group plans to add about 21 GW of
installed renewable capacity, including 4 GW of BESS.
The decarbonization strategy, combined with the push
towards electrification, enables the Group to once again
confirm its commitment to combating climate change. In
2022, the Group delineated a decarbonization roadmap,
which covers both direct and indirect emissions along
the entire value chain. It is composed of four targets
that were certified by the Science Based Target initiative
(SBTi) in December, in line with the goal of keeping global
warming below 1.5 ºC.
Enel’s new certified targets follow up on the ambition
set by the Company in 2021, when it brought forward its
commitment to achieving zero emissions by ten years,
from 2050 to 2040.
The Plan is based on the implementation of a number
of fundamental strategic steps: i) the abandonment of
coal-fired generation by 2027 and gas-fired generation
by 2040, replacing the thermal generation portfolio with
new renewables capacity and hybridizing renewables
with storage solutions; ii) by 2040, 100% of the electricity
sold by the Group will be generated from renewables
and by the same year the Group will stop selling gas to
end users.
About 40% of investments over the course of the
Strategic Plan will be dedicated to the grids in five of
10 Report and financial statements of Enel SpA at December 31, 2022
the six core countries, specifically Italy, Spain, Brazil,
Chile and Colombia, where the Group has an integrated
position and where its experience in digital evolution can
be best deployed, mainly in large metropolitan areas. The
drivers of investments are: the continuous improvement
of the quality and resilience of grids to better handle the
increase in loads, the continuation of the digitalization
process now under way and the increase in demand for
new connections in the wake of the substantial growth
of distributed energy and the expansion of urban grids.
The Group’s net debt will reach around €51-52 billion by
the end of 2023, with a ratio of net debt to EBITDA of
around 2.4-2.5x, remaining stable over the rest of the
Plan period.
The Group’s ordinary EBITDA will grow to between €22.2
and 22.8 billion in 2025, from €19.7 billion in 2022, with a
CAGR of 4-5%, and the Group’s ordinary profit will grow
to €7.0-7.2 billion in 2025, from €5.4 billion in 2022, with
a CAGR of 9-10%.
11Letter to shareholders and other stakeholders
Guide to navigating
the report
To facilitate navigation,
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Contents
1.
14
Enel organizational model 16
Enel shareholders 19
Corporate boards 20
Enel shares 23
Activities of Enel SpA 26
Significant events in 2022 27
Definition of performance
indicators 32
Performance and financial
position of Enel SpA 33
Performance of the main
subsidiaries 38
People centricity 42
Research and development 49
Main risks and opportunities 51
Outlook 59
Other information 60
Incentive system 63
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Report on
Operations
Letter to shareholders and other stakeholders 6
Statement of Comprehensive Income
Statement of Financial Position
Statement of Cash Flows
Statement of Changes in Equity
Income Statement
2.
Corporate
governance
64
Report on corporate governance
and ownership structure 66
4.
164
Report of the Board
of Statutory Auditors
to the Shareholders’
Meeting of Enel SpA 166
Report of the Audit Firm 180
Notice of Ordinary
Shareholders’ Meeting 185
Proposed allocation
of the annual net income 186
Reports
3.
68
Separate financial statements 70
Notes to the separate
financial statements 77
Declaration
of the Chief Executive Officer
and the officer in charge
of financial reporting 163
Separate
financial
statements
1.
14 Report and financial statements of Enel SpA at December 31, 2022
Dividend policy
Enel’s dividend policy remains simple and
predictable, with a DPS of €0.43 for the period
2023-2025, increasing from €0.40 in 2022.
The DPS for 2024 and 2025 is to be
considered a sustainable minimum.
Business model
Enel confirms its business model based on a
proven Ownership model, including the so-
called “Tier 1” countries where the Group has
an integrated business or an important position
(Italy, Spain, Chile, Colombia, Brazil, United
States), and Stewardship model, in countries
where joint ventures, PPAs, acquisitions
of non-controlling interests offer
particularly profitable opportunities
Growth of sustainable finance sources
In line with the “Sustainability-Linked Financing
Framework” and Enel’s sustainability objectives
for the reduction of direct emissions (Scope
1), Enel makes increasing use of sustainable
finance instruments
Report on
Operations
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
15
Enel
organizational
model
16 Report and financial statements of Enel SpA at December 31, 2022
The Enel Group structure is organized into a matrix that
comprises:
• five Global Business Lines, which are responsible in all
the geographical areas in which the Group operates for
developing, building, operating and maintaining assets,
engaging in trading activities, as well as developing and
managing the portfolio of new products and services (in
addition to commodities);
• four Areas and two Countries, which are responsible for
managing relations with customers, institutions and reg-
ulatory authorities, sales of electricity, gas and new prod-
ucts and services at the country level; providing staff ser-
vices and activities to the Global Business Lines present
in the country, integrating the activities of the Business
Lines present in the countries;
• three Global Service Functions, which are responsible for
the integrated management of all Group activities relating
to the development and governance of digital solutions,
procurement and customer processes.
The Holding Company is focused on activities involving a
significant degree of policymaking, coordination and con-
trol for the Group as a whole.
Operating through Administration, Finance and Control,
People and Organization, Communications, Legal and Cor-
porate Affairs, Innovability (Innovation and Sustainability)
and Audit functions, the Holding Company seeks to:
• manage activities with significant value creation potential
for the Group;
• manage activities aimed at protecting the Group from
events that could have a negative impact on its financial
position, image or business continuity;
• support top management and the Business Lines/Func-
tions/Areas/Countries in key strategic decisions concern-
ing those activities and related strategic control issues.
The Holding Company exercises its policymaking, coordina-
tion and control role in essentially two ways:
• direct management: in which, in addition to performing
the policymaking, coordination and control role, it also
has total or prevalent responsibility for performing the as-
sociated activities (e.g., finance, M&A, etc.);
• indirect management: in which it plays a policymaking and
supervisory role, while execution of operations is essen-
tially delegated to the Business Lines/Functions/Areas/
Countries on the basis of policies, processes and guide-
lines. The supervisory role is exercised by way of ex-post
control processes.
Furthermore, in order to ensure the effective coordination
and development of our activities, a reporting system has
been established between the Holding Company functions
indicated above and the corresponding staff functions at
the Business Line/Function/Area/Country level. This re-
porting connection envisages that the Head of the Holding
Company function and the Head of the Business Line/Func-
tion/Area/Country jointly manage the appointment, evalu-
ation and development of the head of the corresponding
Holding Company function at the Business Line/Function/
Area/Country level.
Each Holding Company function is responsible for defining
policies, processes, procedures and organizational struc-
tures, within the scope of their remit, for the entire Group.
The Holding Company functions are also charged with
managing and supervising the professional families in their
respective functions at the Business Line/Function/Area/
Country level.
The following summarizes the main responsibilities attribut-
ed to the Holding Company, which are exercised by the lat-
ter in compliance with company law and the management
autonomy of the listed subsidiaries and/or those subject
to functional separation, in force in the various countries in
which we operate.
Administration, Finance and Control
The Administration, Finance and Control function has
the mission of:
• managing the strategic planning, industrial planning,
budgeting and reporting processes for the Group;
monitoring the evolution of the Group’s operating and
financial results, identifying any deviations and sug-
gesting possible corrective actions;
• supporting the Group Investment Committee in eval-
uating investment proposals;
• conducting M&A operations;
• defining the optimal structure of Group capital and
the composition of debt, managing loans, liquidity and
relations with the international banking system, finan-
cial institutions, investors and analysts and managing
financial risk and insurance coverage for the entire
Group;
• preparing the financial statements of Enel SpA and
setting the guidelines and policies for preparing the
financial statements of the Group companies;
• preparing an adequate and effective internal control
platform for financial and tax information for corpo-
rate reporting;
• ensuring tax compliance for Enel SpA and tax plan-
ning, guidelines and policies for the Group;
• monitoring and managing commodity, financial and
strategic risks as well as any other risk that could po-
tentially affect the Group’s value, with a view to opti-
mizing or minimizing their impact.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
17Enel organizational model
People and Organization
The People and Organization function has the mission of:
• defining organizational arrangements in line with Group
strategies, guiding change management programs;
• managing the function’s budget and the long-term plan
at the Group level, defining guidelines and objectives; de-
fining the Group’s guidelines for the compensation and
benefit process; managing industrial relations;
• developing the Group’s technical, professional and mana-
gerial skills in accordance with the needs of the business,
promoting integration across the business and cultures;
• defining the Group’s strategies and guidelines for man-
aging health, safety, the environment, quality and security,
ensuring their implementation at the Group level.
Communications
The Communications function has the mission of:
• developing and managing the global Enel brand identity,
leveraging the Group’s resources, skills and operational
excellence;
• managing relations with global media;
• developing and managing internal communication of lo-
cal and global content and defining the guidelines to be
applied at the country level;
• managing and optimizing the Group’s online communica-
tion channels, including the Group’s websites and social
network presence.
Legal and Corporate Affairs
The Legal and Corporate Affairs function has the mission of:
• providing legal assistance and support to the entire
Group, identifying and managing legal issues and litiga-
tion and ensuring the compliance of activities carried out
by Group companies with applicable laws and regulations;
• managing the corporate governance system and advising
on the related issues (including relations with the financial
market regulatory authorities and managing the corpo-
rate bodies and the system of delegated powers).
Innovability (Innovation and Sustainability)
The Innovability (Innovation and Sustainability) function has
the mission of:
• promoting the sharing and development of new ideas
for possible business approaches and new technologies,
providing structured monitoring of the proposals from
their reception to the incubation of an idea through to
its ultimate deployment, coordinating the various Global
Business Lines and Service Functions;
• promoting and identifying potential startups and partner-
ships, in collaboration with the Global Business Lines and
Countries;
• promoting, coordinating and supporting innovative pro-
jects among the Global Business Lines;
• promoting and consolidating the Group’s strategy for in-
novation and providing appropriate reporting on innova-
tion activities within the Group;
• managing the process of planning and defining sustaina-
bility objectives, preparing the Group’s Sustainability Plan
and monitoring achievement of the associated results;
• preparing the Group Sustainability Report, preparing
an appropriate and effective consolidated Sustainabil-
ity/Non-Financial Statement, drafting the declaration
of alignment with the European taxonomy and defining
guidelines and policies for the Sustainability Reports and
the sustainability disclosures of the Group companies;
• establishing an adequate and effective Internal Sustaina-
bility Control System for sustainability/non-financial infor-
mation reporting;
• handling the Group’s relations with international bodies
on CSR issues, managing CSR/CSV projects at the Group
level.
Audit
The Audit function has the mission of:
• systematically and independently assessing the effective-
ness and adequacy of the Enel Group’s internal control
system;
• supporting each part of the Group in monitoring risks and
identifying mitigation actions.
18 Report and financial statements of Enel SpA at December 31, 2022
Enel shareholders
At December 31, 2022, the fully subscribed and paid-up
share capital of Enel SpA totaled €10,166,679,946, repre-
sented by the same number of ordinary shares with a par
value of €1.00 each. Share capital is unchanged compared
with that registered at December 31, 2021. In 2022 the
Company purchased a total of 2,700,000 treasury shares to
support the 2022 Long-Term Incentive Plan (LTI Plan) for the
management of Enel and/or its subsidiaries pursuant to Arti-
cle 2359 of the Italian Civil Code. Considering the 4,889,152
treasury shares already owned and taking account of the
award on September 5, 2022 of 435,357 ordinary treasury
shares to the beneficiaries of the 2019 Long-Term Incentive
Plan, Enel SpA holds a total of 7,153,795 treasury shares, all
supporting the 2019, 2020, 2021 and 2022 LTI Plans.
Significant shareholders
At December 31, 2022, based on the shareholders register
and the notices submitted to CONSOB and received by the
Company pursuant to Article 120 of Legislative Decree 58
of February 24, 1998, as well as other available information,
shareholders with an interest of greater than 3% in the Com-
pany’s share capital included the Ministry for the Economy
and Finance (with a 23.585% stake) and BlackRock Inc. (with
a stake of 5.114% held for asset management purposes).
Composition of shareholder base
Since 1999, Enel has been listed on the Euronext Milan mar-
ket organized and operated by Borsa Italiana SpA. Enel’s
shareholders include leading international investment funds,
insurance companies, pension funds and ethical funds.
With regard to Environmental, Social and Governance (ESG)
investors in Enel, at December 31, 2022, socially responsible
investors (SRIs) held around 14.9% of the share capital (up
from 14.6% at December 31, 2021), while investors who have
signed the Principles for Responsible Investment represent
42.1% of the share capital.
56.7%
Institutional
investors
23.6%
Ministry for the Economy
and Finance
19.7%
Retail
investors
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
19Enel shareholders
Corporate boards
CHAIRMAN
Michele Crisostomo
CHIEF EXECUTIVE OFFICER
AND GENERAL MANAGER
Francesco Starace
SECRETARY
Silvia Alessandra Fappani
DIRECTORS
Cesare Calari
Costanza Esclapon de Villeneuve
Samuel Leupold
Alberto Marchi
Mariana Mazzucato
Mirella Pellegrini
Anna Chiara Svelto
Board of Directors
Board of
Statutory Auditors
CHAIRMAN
Barbara Tadolini
AUDITORS
Luigi Borré
Maura Campra
ALTERNATE AUDITORS
Carolyn A. Dittmeier
Tiziano Onesti
Piera Vitali
Audit Firm
KPMG SpA
20 Report and financial statements of Enel SpA at December 31, 2022
2022
(1) The figures for 2022 and 2021 refer to directors qualifying as independent pursuant to the Consolidated Law on Financial
Intermediation and the Italian Corporate Governance Code (2020 edition).
COMPOSITION OF THE BOARD
OF DIRECTORS
of which 8 independent
(1)
8 in 2021
8 non-executive directors
8 in 2021
55.6%
44.4%
44.4%
in 2021
55.6%
in 2021
4
Women
4 in 2021
5
Men
5 in 2021
89 %
> 50
0 %
< 30
GENDER
AGE
1 executive director
1 in 2021
11 %
30-50
EXPERTISE
Energy industry
Legal and corporate governance
Strategic vision
Communication and marketing
Accounting, finance and risk management
International experience
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
21Corporate boards
Powers
Board of Directors
The Board is vested by the bylaws with the broadest pow-
ers for the ordinary and extraordinary management of the
Company, and specifically has the power to carry out all
the actions it deems advisable to implement and attain the
corporate purpose.
Chairman of the Board of Directors
The Chairman is vested by the bylaws with the powers to
represent the Company and to sign on its behalf, presides
over Shareholders’ Meetings, convenes and presides over
the Board of Directors, and ascertains that the Board’s res-
olutions are carried out. Pursuant to a Board resolution of
May 15, 2020, the Chairman has been vested with a num-
ber of additional non-executive powers.
Chief Executive Officer
The Chief Executive Officer is also vested by the bylaws
with the powers to represent the Company and to sign on
its behalf, and in addition is vested by a Board resolution of
May 15, 2020 with all powers for managing the Company,
with the exception of those that are otherwise assigned by
law or the Bylaws or that the aforesaid resolution reserves
for the Board of Directors.
22 Report and financial statements of Enel SpA at December 31, 2022
Enel shares
Enel and the financial markets
2022 2021
Gross operating profit per share (euro)
(1)
1.96 1.70
Operating profit per share (euro)
(1)
1.10 0.74
Group profit per share (euro) 0. 17 0.31
Group ordinary profit per share (euro) 0.53 0.55
Dividend per share (euro) 0.380 0.358
Group equity per share (euro) 2.82 2.92
Share price - 12-month high (euro) 7. 20 8.95
Share price - 12-month low (euro) 4.00 6.53
Average share price in December (euro) 5.15 6.77
Market capitalization (millions of euro)
(2)
52,325 68,804
No. of shares outstanding at December 31 (millions)
(3)
10,167 10,167
(1) The figure for 2021 has been adjusted, for comparative purposes only, to take account of the classification under the item “Profit/(Loss) from discontinued
operations” of profit/(loss) connected with the assets held in Russia (which were sold in the 4th Quarter of 2022), Romania and Greece as the requirements
of IFRS 5 for their classification as discontinued operations have been met.
(2) Calculated on average share price in December.
(3) The number of shares includes 7,153,795 treasury shares in 2022 and 4,889,152 treasury shares in 2021.
at Dec. 31, 2022 at Dec. 31, 2021
Rating
Standard & Poor’s Outlook NEGATIVE STABLE
Medium/long-term BBB+ BBB+
Short-term A-2 A-2
Moody’s Outlook NEGATIVE STABLE
Medium/long-term Baa1 Baa1
Short-term - -
Fitch Outlook STABLE STABLE
Medium/long-term BBB+ A-
Short-term F2 F2
Global macroeconomic conditions in 2022 were charac-
terized by a generalized slowdown in the real economy
from the pace registered in the post-pandemic recovery
that had marked 2021. High inflation quickly and unex-
pectedly impacted global economies, and forced the cen-
tral banks to promptly adopt restrictive monetary policies.
Furthermore, the military conflict between Russia and
Ukraine, and the resulting uncertainty it has engendered
on a global scale, has significantly impacted the energy,
commodity and food markets, with direct repercussions
on the prices of final consumer goods.
The inflationary dynamics, accompanied by the conse-
quent restrictive financial conditions imposed by the Fed-
eral Reserve, weighed on the performance of US GDP, with
output growing by 2.1% on an annual basis.
In the euro area, the first half of the year experienced a
faster than expected recovery, while the second half was
marked by a significant slowdown in the European econ-
omies due to the high uncertainty deriving from the mil-
itary conflict between Russia and Ukraine, as well as the
sudden increase in energy prices. The restrictive monetary
policy measures introduced by the European Central Bank
to counter the increase in inflation led to a deterioration in
financial conditions on the markets.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
23Enel shares
The situation was similar in Latin America, where after a
significant recovery in private demand for goods and ser-
vices in the first half of the year, macroeconomic condi-
tions were characterized by the restrictive monetary pol-
icies of the national central banks, which dampened the
economic recovery.
The adverse macroeconomic situation impacted the per-
formance of the financial markets. The main European
stock indices closed 2022 with losses: the Italian FTSE-MIB
index -13.3%, the Spanish Ibex35 index -5.6%, the German
DAX -12.4% and the French CAC40 index -9.8%.
The euro-area Utilities sector (EURO STOXX Utilities) closed
the year with a decline of 11.3%.
Finally, as regards the Enel stock, 2022 ended with a price
of €5.03 per share, a decline of 28.6% on the previous year.
On January 26, 2022 Enel paid an interim dividend of €0.19
per share from 2021 profits and on July 20, 2022 it paid
the balance of the dividend for that year in the amount
of €0.19. Total dividends distributed in 2022 amounted
to €0.38 per share, about 6% higher than the €0.358 per
share distributed in 2021.
On January 25, 2023 an interim dividend of €0.20 per share
was paid in respect of ordinary profit for 2022, while the
balance of the dividend is scheduled for payment on July
26, 2023.
At December 31, 2022, institutional investors had reduced
their position in Enel to 56.7% of share capital (compared
with 59.4% at December 31, 2021), while the share of indi-
vidual investors rose to 19.7% (as against 17.0% at Decem-
ber 31, 2021). The interest of the Ministry for the Economy
and Finance was unchanged at 23.6%.
Socially responsible investors (SRIs) held about 14.9% of
share capital at December 31, 2022 (up from 14.6% at De-
cember 31, 2021) and represent 26.2% of institutional in-
vestors (24.6% at December 31, 2021). Investors who have
signed the Principles for Responsible Investment repre-
sent 42.1% of share capital.
For further information we invite you to visit the Investor
Relations section of our corporate website (https://www.
enel.com/it/investitori/in-evidenza) and download the
“Enel Investor Relations” app, which contains both eco-
nomic and financial information (annual reports, semi-an-
nual and quarterly reports, presentations to the financial
community, analyst estimates and stock market trading
trends involving the shares issued by Enel and its main
listed subsidiaries, ratings and outlooks assigned by rat-
ing agencies) and up-to-date data and documentation of
interest to shareholders and bondholders in general (price
sensitive press releases, outstanding bonds, bond issue
programs, composition of Enel’s corporate bodies, bylaws
and regulations of Shareholders’ Meetings, information
and documentation relating to Shareholders’ Meetings,
procedures and other documentation concerning cor-
porate governance, the Code of Ethics and organizational
and management arrangements.
We have also created contact centers for private investors
(which can be reached by phone at +39-0683054000 or
by e-mail at azionisti.retail@enel.com) and for institution-
al investors (phone: +39-0683051; e-mail: investor.rela-
tions@enel.com).
24 Report and financial statements of Enel SpA at December 31, 2022
Growth in ESG investors
ESG investors no.
Float %
Share capital %
Performance of Enel share price and the EURO STOXX Utilities and FTSE-MIB indices from January 1,
2022 to January 31, 2023
Source: Bloomberg.
2015
7.7
10.3
2014
5.9
8.6
2016
8.0
10.5
2017
8.6
11.3
2018
10.5
13.7
2019
10.8
14.1
2020
14.6
19.1
2021
14.6
19.1
2022
14.9
19.4
134
132
150
160
169
182
244
252
245
Andamento titolo Enel e indici EURO STOXX Utilities e FTSE-MIB,
dal 1° gennaio 2022 al 31 gennaio 2023
Enel
EURO STOXX Utilities
FTSE-MIB
01/01 01/02 01/03 01/04 01/05 01/06 01/07 01/08 01/09 01/10 01/11 01/12 01/01
2022
2023
130
120
110
100
90
80
70
60
50
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
25Enel shares
Activities of Enel SpA
Enel SpA, in its capacity as an industrial holding compa-
ny, determines strategic objectives for the Group and the
subsidiaries, coordinating their activity. The activities that
Enel SpA performs as part of its policymaking and coordi-
nation function in respect of the other Group companies,
as reflected in the organizational structure adopted by the
Company, can be summarized as follows:
Holding Company functions, connected with the coordi-
nation of governance processes at the Group level:
• Administration, Finance and Control;
• People and Organization;
• Communications;
• Legal and Corporate Affairs;
• Innovability (Innovation and Sustainability);
• Audit.
Enel SpA meets the Group’s liquidity requirements, mainly
using the cash flows generated by ordinary operations and
a range of funding sources, appropriately managing any
excess liquidity.
26 Report and financial statements of Enel SpA at December 31, 2022
Significant events in 2022
Placement of a multi-tranche €2.75 billion sustainability-
linked bond
On January 10, 2022, Enel Finance International NV (EFI) is-
sued a multi-tranche sustainability-linked bond for institu-
tional investors in the Eurobond market in the total amount
of €2.75 billion.
The new issue, guaranteed by Enel, is linked to the achieve-
ment of Enel’s sustainable objective relating to the reduc-
tion of direct greenhouse gas emissions (Scope 1), con-
tributing to United Nations Sustainable Development Goal
(SDG) 13 (“Climate Action”) and in line with the Group’s Sus-
tainability-Linked Financing Framework.
The proceeds from the issue will be used by EFI to fund the
Group’s ordinary financing needs.
Placement of a multi-tranche $3.5 billion sustainability-
linked bond
On June 9, 2022, Enel Finance International NV issued a
multi-tranche sustainability-linked bond for institution-
al investors in the US and international markets totaling
$3.5 billion, equivalent to about €3.3 billion. The bond is
linked to the achievement of Enel’s sustainability objective
relating to the reduction of direct greenhouse gas emis-
sions (Scope 1), contributing to United Nations Sustainable
Development Goal (SDG) 13 (“Climate Action”) and in ac-
cordance with the Group’s Sustainability-Linked Financing
Framework.
Enel launches a sustainability-linked share buyback program
serving its 2022 Long-Term Incentive Plan
On June 16, 2022, the Board of Directors of the Company,
implementing the authorization granted by the Sharehold-
ers’ Meeting of May 19, 2022 and in compliance with the
relevant terms already disclosed to the market, approved
the launch of a share buyback program for 2.7 million
shares (the “Program”), equivalent to approximately 0.027%
of Enel’s share capital.
The Program started on June 17 and ended on July 20
with the purchase of a total of 2,700,000 Enel ordinary
shares (equal to 0.026557% of the share capital) at a vol-
ume-weighted average price of €5.1951 per share, for total
of approximately €14 million.
Additionally, on September 5, a total of 435,357 shares
were awarded to the beneficiaries of the Long-Term In-
centive Plan for 2019.
Taking account of the foregoing and considering the
treasury shares already held, Enel holds a total of 7,153,795
treasury shares, equal to 0.070365% of the share capital.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
27Significant events in 2022
Enel and Intesa Sanpaolo finalize acquisition of Mooney
On July 14, 2022, Enel SpA, acting through its whol-
ly-owned subsidiary Enel X Srl, and Intesa Sanpaolo SpA,
acting through its subsidiary Banca 5 SpA, finalized the ac-
quisition from Schumann Investments SA, a company con-
trolled by the international private equity fund CVC Capital
Partners Fund VI, of 70% of the share capital of Mooney
Group SpA, a fintech company operating in proximity
banking and payments. Specifically, after having obtained
the required administrative authorizations, Enel X acquired
50% of Mooney’s share capital, whereas Banca 5, which
previously owned a 30% stake in Mooney, increased its in-
vestment to 50%, placing Mooney under the joint control
of both parties.
Enel launches a €1 billion sustainability-linked bond in the
Eurobond market
On September 6, 2022, Enel Finance International NV
launched a sustainability-linked bond for institutional in-
vestors in the Eurobond market in the total amount of
€1 billion. The new issue is linked to the achievement of
Enel’s sustainable objective relating to the reduction of
direct greenhouse gas emissions (Scope 1), contributing
to United Nations Sustainable Development Goal (SDG) 13
(“Climate Action”) and in accordance with the Group’s Sus-
tainability-Linked Financing Framework.
Enel issues new $4 billion multi-tranche US dollar
sustainability-linked bonds
On October 6, 2022, Enel Finance International NV, the
Dutch-registered finance company, and Enel Finance
America LLC, the US-registered finance company, issued
sustainability-linked bonds with a total aggregate amount
of $4.0 billion, equivalent to about €4.1 billion, reserved for
institutional investors in the US and international markets.
The bonds will be issued separately in different tranches
and are guaranteed by Enel.
The bonds are linked to the achievement of Enel’s sustain-
ability objective relating to the reduction of direct green-
house gas emissions (Scope 1), contributing to United
Nations Sustainable Development Goal (SDG) 13 (“Climate
Action”) and in accordance with the Group’s Sustainabili-
ty-Linked Financing Framework.
The transaction is linked to a trajectory towards full de-
carbonization with the 30-year tranche linked to the Enel
Group’s target of achieving zero direct greenhouse gas
emissions by 2040 from the production of electricity and
heat.
Sale of entire 56.43% stake in PJSC Enel Russia
On October 12, 2022, the Company finalized the sale of
its entire stake in PJSC Enel Russia, equal to 56.43% of the
latter’s share capital, to PJSC Lukoil and the Closed Com-
bined Mutual Investment Fund “Gazprombank-Frezia”, for
a total of about €137 million, following satisfaction of all
the conditions set out in the two separate contracts en-
tered into with them, including approval of the transaction
by the President of the Russian Federation in accordance
with paragraph 5 of Decree 520 of August 5, 2022.
As a result of the transaction, Enel has disposed of all its
Russian power generation assets, which included approx-
imately 5.6 GW of conventional capacity and around 300
MW of wind capacity at different stages of development.
The transaction is consistent with the Group’s strategic
aim to focus its activities mainly in countries where an in-
tegrated position along the value chain can drive growth
and enhance value creation from the opportunities offered
by the energy transition.
28 Report and financial statements of Enel SpA at December 31, 2022
The overall transaction generated a positive effect on the
Group’s consolidated net debt of about €610 million and a
negative impact on reported Group profit of around €1.3
billion, mainly reflecting the release of a currency trans-
lation reserve of around €1.0 billion as of September 30,
2022. This accounting effect will not have any impact on
ordinary financial performance.
Enel agrees on a $800 million sustainability-linked general
purpose loan with EKF and Citi
In October, the Enel Group received a facility from Den-
mark’s export credit agency, EKF, for up to $800 million.
The facility, arranged by Citi, is based on the Group’s
worldwide business relationship with Danish suppliers and
is aimed at supporting the development of wind energy as
well as mitigating the effects caused by climate change, as
part of Enel’s 2040 Net-Zero ambition, through a flexible
instrument.
This agreement represents EKF’s first sustainability-linked
general purpose financing. As part of the agreement, Enel
Finance America LLC will benefit from the ability to make
a significant upfront drawdown with a first tranche in Oc-
tober 2022 and the remainder with a second tranche to
be utilized early in 2023, with both amounts intended to
support the development of Enel’s strategy to increase
investments in wind, helping to lead the energy transition
towards decarbonization.
Under the agreement, EKF is the Lender and Citi acts
as Mandated Lead Arranger, Facility Agent and Coun-
ter-Guarantor to EKF.
Enel approves the issue of hybrid bonds up to a maximum of
€2 billion
On December 14, 2022, the Board of Directors of Enel SpA
(“Enel” or the “Company”) authorized Enel to issue, by De-
cember 31, 2023, of one or more non-convertible subordi-
nated hybrid bonds, including perpetual bonds, in an over-
all maximum amount of up to €2 billion. The bonds are to
be placed exclusively with European and non-European in-
stitutional investors, including through private placements.
In the same resolution, Enel’s Board of Directors also re-
voked the resolution of December 16, 2021 not yet imple-
mented concerning the issue of one or more bonds of the
same type by the Company.
If issued, the new bonds will enable Enel to refinance the
maturities of a number of outstanding hybrid bonds.
The Board of Directors also delegated to the Chief Execu-
tive Officer the task of deciding the issue of the new bonds
and their respective characteristics and, accordingly, of
establishing for each issue – taking account of the evolu-
tion of market conditions – the timing, amount, currency,
interest rate and further terms and conditions, as well as
the placement methods and any listing on regulated mar-
kets or multilateral trading facilities.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
29Significant events in 2022
Enel enters into exclusive negotiations with PPC on sale of
all Romanian operations
On December 14, 2022, Enel announced that it had en-
tered into an Exclusivity Agreement with the Greek com-
pany Public Power Corporation SA (PPC) concerning the
potential disposal of all the equity investments held by Enel
Group in Romania (“Target Assets”).
On March 9, 2023, the two companies signed an agree-
ment to sell all the equity stakes held by the Enel Group
in Romania to PPC. The agreement provides that PPC will
pay a total consideration of approximately €1,260 million,
equivalent to an enterprise value of about €1,900 million
(on a 100% basis). In addition, the total consideration is
subject to adjustments customary for this kind of transac-
tions as well as to an earn-out mechanism for a potential
additional payment based on the future value of the retail
business.
The transaction is in line with the Group’s current Strategic
Plan, which envisages the repositioning of Enel on higher
growth six core countries.
The closing of the sale, which is expected by the 3rd Quar-
ter of 2023, is subject to certain conditions precedent cus-
tomary for this kind of transactions, including the clear-
ance from competent Antitrust authorities.
Enel closes sale of 50% of Gridspertise to CVC
On December 22, 2022, Enel, acting through Enel Grids
Srl, finalized the sale of 50% of its wholly-owned subsidi-
ary Gridspertise Srl to the international private equity fund
CVC Capital Partners Fund VIII (CVC), following the fulfill-
ment of all conditions set out in the agreement signed on
October 18, 2022.
Under the provisions of the above agreement, CVC paid a
total of about €300 million, equivalent to an enterprise val-
ue of €625 million (on a 100% basis). In addition, the agree-
ment includes potential deferred payments that could
bring the enterprise value up to €1 billion (on a 100% basis).
The overall transaction had a positive impact in the Enel
Group’s EBITDA of around €500 million, alongside an ex-
pected positive effect on the Group’s consolidated net
debt of around €300 million.
Following the transaction, Enel and CVC operate the com-
pany on a joint control basis.
The transaction is in line with the Enel Group’s current Stra-
tegic Plan, under the Stewardship model, which envisages
investments carried out with third parties, with the aim to
add new infrastructure and services in order to accelerate
the electrification process of customers’ energy demand.
Enel signs a €12 billion revolving credit facility guaranteed
by SACE
On December 23, 2022, the Company and a pool of finan-
cial institutions composed of Banco BPM SpA, BPER Banca
SpA, Cassa Depositi e Prestiti SpA (CDP), Intesa Sanpao-
lo SpA and UniCredit SpA, with the latter also acting as
agent bank, signed a €12 billion revolving credit facility (the
“Credit Facility”) to fund the collateral requirements of the
trading activities of Enel and Enel Global Trading SpA on
energy markets.
The Credit Facility, which is guaranteed by the Italian ex-
port credit agency SACE SpA (SACE) up to 70% of its nom-
inal amount (the “Guarantee”) and has a term of about 18
months, was finalized in line, inter alia, with the provisions
of (i) Communication C(2022) 7945 final from the Europe-
an Commission regarding the “Temporary Crisis Frame-
work for State Aid measures to support the economy fol-
lowing the aggression against Ukraine by Russia” and Eu-
ropean Commission Decision SA.104722 of December 20,
2022 regarding “State aid: amendments to Italian scheme,
including up to €23 billion budget increase, to support
companies in context of Russia’s war against Ukraine”, as
well as (ii) Decree Law 50 of May 17, 2022 (the “Aid Decree”),
ratified with Law 91 of July 15, 2022, as amended by Decree
Law 144 of September 23, 2022, ratified with Law 175 of
November 17, 2022.
The Credit Facility is part of a structured course of action
to protect Italy’s energy system, aimed at providing sector
operators with an additional tool for managing the risks as-
sociated with the very large size reached by the contracts
stipulated to cover industrial positions (so-called margin-
ing) due to the continuing volatility of the energy markets
as a result of the crisis. Therefore, the transaction falls
within the framework of the measures that current leg-
islation makes available to all Italy-based companies that
meet specific characteristics, in order to face the negative
30 Report and financial statements of Enel SpA at December 31, 2022
effects deriving from the Russia-Ukraine crisis. The trans-
action is in line with similar instruments made available in
other European countries.
The Credit Facility has a 50-basis-point spread above Eu-
ribor and a non-use fee equal to 35% of the spread. Under
the provisions of the “Aid Decree”, the annual guarantee
premium is, in relation to the guaranteed amount, set at
50 basis points for the first year and 100 basis points for
the second year. The disbursement of the first drawing on
the Credit Facility and the effectiveness of the Guarantee
are subject to the adoption of a specific decree of Italy’s
Minister for the Economy and Finance, in agreement with
the Minister for Enterprises and Made in Italy.
The Credit Facility does not have any impact on the Enel
Group’s net financial debt. The Group has a sound liquidity
position, amounting to around €24.7 billion (excluding the
Credit Facility) at the end of September 2022.
The overall transaction operation qualifies as one with re-
lated parties due to the fact that Enel, CDP and SACE are
companies under the common control of Italy’s Ministry for
the Economy and Finance. Specifically, for Enel the trans-
action represents, under this perspective, a transaction of
“greater importance” having regular nature and complet-
ed at market-equivalent or standard terms. As such, the
transaction is exempt from the obligation to publish an ad
hoc information document and the approval procedures
set out in the relevant CONSOB regulations, in accordance
with the latter and with the Enel Procedure for Transac-
tions with Related Parties.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
31Significant events in 2022
Definition of performance indicators
In order to present the results of the Parent and analyze
its financial structure, Enel has prepared separate re-
classified schedules that differ from those envisaged un-
der the IFRS-EU adopted by the Group and by Enel SpA
and presented in the consolidated and separate financial
statements. These reclassified schedules contain different
performance indicators from those obtained directly from
the consolidated and separate financial statements, which
management feels are useful in monitoring the perfor-
mance of the Group and the Parent and representative of
the financial performance of the business.
With regard to those indicators, on April 29, 2021, CON-
SOB issued warning notice no. 5/2021, which gives force
to the Guidelines issued on March 4, 2021, by the Euro-
pean Securities and Markets Authority (ESMA) on disclo-
sure requirements under Regulation (EU) 2017/1129 (the
Prospectus Regulation), which took effect on May 5, 2021.
The Guidelines update the previous CESR Recommenda-
tions (ESMA/2013/319, in the revised version of March 20,
2013) with the exception of those concerning the special
issuers referred to in Annex no. 29 of Delegated Regulation
(EU) 2019/980, which were not converted into Guidelines
and remain applicable.
As from May 5, 2021, the ESMA Guidelines replace refer-
ences contained in previous CONSOB communications to
the CESR Recommendations on the prospectus, including
those contained in Communication no. DEM/6064293 of
July 28, 2006 regarding the net financial position.
These Guidelines are intended to promote the usefulness
and transparency of alternative performance indicators
included in regulated information or prospectuses within
the scope of application of Directive 2003/71/EC in order
to improve their comparability, reliability and comprehen-
sibility.
Accordingly, in line with the regulations cited above, the
criteria used to construct these indicators are as follows:
Gross operating profit: an operating performance indica-
tor, calculated as “Operating profit” plus “Depreciation,
amortization and impairment losses”.
Net non-current assets: calculated as the difference be-
tween “Non-current assets” and “Non-current liabilities”
with the exception of:
• “Deferred tax assets”;
• “Other financial assets” included in “Other non-current
financial assets”;
• “Long-term borrowings”;
• “Employee benefits”;
• “Provisions for risks and charges (non-current portion)”;
• “Deferred tax liabilities”.
Net working capital: calculated as the difference between
“Current assets” and “Current liabilities” with the exception
of:
• “Long-term loan assets (current portion)”, “Cash collat-
eral” and “Other financial assets” included in “Other cur-
rent financial assets”;
• “Cash and cash equivalents”;
• “Short-term borrowings” and the “Current portion of
long-term borrowings”;
• “Provisions for risks and charges (current portion)”;
• “Other borrowings” included in “Other current liabilities”.
Gross capital employed: calculated as the algebraic sum of
“Net non-current assets” and “Net working capital”, “De-
ferred tax liabilities” and “Deferred tax assets”, as well as
“Net assets held for sale”.
Net capital employed: calculated as the algebraic sum
of “Gross capital employed” and “Provisions for risks and
charges”.
Net financial debt: a financial structure indicator, calculat-
ed as:
• “Long-term borrowings”, “Short-term borrowings” and
the "Current portion of long-term borrowings", taking
account of “Short-term borrowings” included in “Other
current liabilities”;
• net of “Cash and cash equivalents”;
• net of the “Current portion of long-term loan assets”,
“Cash collateral” and “Other financial assets” included in
“Other current financial assets”;
• net of “Other financial assets” included in “Other
non-current financial assets”.
32 Report and financial statements of Enel SpA at December 31, 2022
Performance and financial position
of Enel SpA
Performance
The financial performance of Enel SpA for the years 2022
and 2021 is summarized in the table below:
Millions of euro
2022 2021 Change
Revenue
Revenue from sales and services 116 125 (9)
Other income 17 1,644 (1,627)
Total 133 1,769 (1,636)
Costs
Purchases of consumables - 1 (1)
Services, leases and rentals 206 197 9
Personnel expenses 105 179 (74)
Other operating costs 27 14 13
Total 338 391 (53)
Gross operating profit/(loss) (205) 1,378 (1,583)
Depreciation, amortization and impairment losses 1,330 734 596
Operating profit/(loss) (1,535) 644 (2,179)
Net financial income/(expense) and income/(expense) from equity
investments
Income from equity investments 8,770 4,451 4,319
Financial income 2,563 1,313 1,250
Financial expense 2,747 1,760 987
Total 8,586 4,004 4,582
Pre-tax profit/(loss) 7,0 51 4,648 2,403
Income taxes (106) (114) 8
PROFIT FOR THE YEAR 7, 157 4,762 2,395
Revenue from sales and services regards revenue for man-
agement services, IT assistance and other services provid-
ed to subsidiaries. The decrease of €9 million is attributa-
ble to reductions in revenue from management services
(€8 million) and from IT services (€4 million), which were
partially offset by the increase in revenue from other ser-
vices (€3 million).
Other income essentially includes the chargeback of costs
for Enel SpA personnel seconded to other Group compa-
nies, which increased by €2 million.
In 2021, other income included a €1,629 million capital
gain from the sale of the 50% investment held in the joint
venture Open Fiber SpA to Macquarie Asset Management
and CDP Equity SpA.
Costs for purchases of consumables were essentially un-
changed on the previous year.
Costs for services, leases and rentals regard services pro-
vided by third parties in the amount of €73 million and by
Group companies in the amount of €133 million.
Third-party services mainly include communication ser-
vices, professional and technical services, strategic con-
sulting, business management and organization, legal and
notary services as well as IT services.
The charges for services provided by Group companies
essentially refer to the subsidiaries Enel Global Services
Srl and Enel Italia SpA and concern system and applica-
tion assistance services, services for management of the
motor pool and other personal services, management
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
33Performance and financial position of Enel SpA
services, administrative services, personnel management
services, and telecommunication costs.
Personnel expenses totaled €105 million, a decrease of
€74 million compared with 2021. The reduction is mainly
attributable to the decrease in costs for early-retirement
incentives due to adjustments to the related plans.
Other operating costs, in the amount of €27 million, in-
creased by €13 million on the previous year essentially due
to the write-off of trade receivables of €8 million, following
the sale of the equity interest in PJSC Enel Russia.
The gross operating loss of €205 million reflects a de-
crease of €1,583 million from the previous year, mainly at-
tributable to a decrease in revenue, partially offset by lower
personnel expenses.
Depreciation, amortization and impairment losses amount-
ed to €1,330 million, an increase of €596 million on the
previous year.
Depreciation and amortization amounted to €56 million, of
which €4 million in depreciation and €52 million in amor-
tization.
Impairment losses include the adjustment in the value of
the investments in subsidiaries in Romania, recognized as
non-current assets held for sale, for a total of €995 million,
as well as the adjustment of €195 million to the investment
in PJSC Enel Russia, which was sold in October 2022.
The item also reflects the adjustment in the value of eq-
uity investments in Enel Green Power SpA (in the amount
of €228 million), Enel Innovation Hubs Srl (€16 million), and
Enel Investment Holding BV (€1 million).
It also includes reversals of impairment losses on the in-
vestments in the subsidiaries Enel Global Trading SpA
(€162 million) and Enel Global Services Srl (€1 million).
In 2021, depreciation, amortization and impairment losses
of €734 million mainly included adjustments to the value
of investments in the distribution companies in Romania
(totaling €270 million), in Enel Green Power SpA (€497 mil-
lion), and in other subsidiaries in Italy and the Netherlands
(totaling €21 million). The item also included reversals of
impairment losses on the investments in the subsidiaries
Enel Global Trading SpA (€43 million), Enel Italia SpA (€41
million), and Enel Innovation Hubs Srl (€7 million).
The operating loss came to €1,535 million. The €2,179 mil-
lion decrease in profitability from 2021 is attributable to the
aforementioned decrease in revenue and to higher impair-
ment losses on equity investments.
Income from equity investments amounted to €8,770 mil-
lion and included dividends approved by subsidiaries and
associates in the amount of €8,761 million and joint ven-
tures in the amount of €9 million. Compared to the pre-
vious year, income from equity investments increased by
€4,319 million, mainly reflecting the distribution of avail-
able reserves by Enel Italia SpA (€6,000 million), partially
offset by a decrease in earnings distributed by Enel Iberia
SRLU, Enel Américas SA, and Enel Chile SA.
Net financial expense came to €184 million and essentially
reflects interest expense on debt (€694 million), partially
offset by commission income on guarantees issued for
other companies of the Group (€204 million), interest in-
come on financial assets (€183 million), and net financial
income on derivative contracts (€171 million).
Compared with the previous year, net financial expense
decreased by €263 million, reflecting the increase in inter-
est and other financial income (€148 million) and the pos-
itive contribution of exchange rate developments (€133
million), partially offset by the decrease in financial income
on derivative instruments (€11 million).
Income taxes for the year showed a creditor position of
€106 million, mainly as a result of the reduction in the tax
base for corporate income tax (IRES) compared with pre-
tax profit due to the exclusion of 95% of the dividends re-
ceived from the subsidiaries and the deductibility of Enel
SpA’s interest expense for the Group under the consolidate
taxation mechanism in accordance with corporate income
tax law (Article 96 of the Consolidated Income Tax Code).
Compared with the previous year, the change of €8 million
is mainly due to the decline in estimated taxable income
for IRES.
Profit for the year totaled €7,157 million, compared with
€4,762 million the previous year. The increase of €2,395
million mainly reflects the increase in income from equity
investments and the results of finance operations, partially
offset by the decrease in other income and the increase
in impairment adjustments on equity investments as de-
scribed above.
34 Report and financial statements of Enel SpA at December 31, 2022
Analysis of financial position
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Net non-current assets:
- property, plant and equipment and intangible assets 144 155 (11)
- equity investments 59,952 60,269 (317)
- net other non-current assets/(liabilities) (246) (465) 219
Total 59,850 59,959 (109)
Net working capital:
- trade receivables 294 275 19
- net other current assets/(liabilities) (2,066) (1,818) (248)
- trade payables (154) (167) 13
Total (1,926) (1,710) (216)
Gross capital employed 57,9 24 58,249 (325)
Provisions:
- employee benefits (131) (172) 41
- provisions for risks and charges and net deferred taxes 6 89 (83)
Total (125) (83) (42)
Non-current assets classified as held for sale 654 - 654
Net capital employed 58,453 58,166 287
Total equity 38,342 34,967 3,375
NET FINANCIAL DEBT 20,111 23,199 (3,088)
The decrease in net non-current assets essentially reflect-
ed:
• €317 million from a decrease in the value of the invest-
ments in subsidiaries, which was basically attributable to
the following transactions:
– the capital contribution to the subsidiary Enel North
America Inc. in the amount of €880 million;
– the acquisition of an interest in Enel X Way Srl by Enel
X Italia Srl in the amount of €58 million and the sub-
sequent capital contribution of €800 million to Enel
X Way Srl;
– the reclassification as “Non-current assets held for
sale” of the interest held in the subsidiary PJSC Enel
Russia, recognized at a value of €332 million, follow-
ing the agreements signed at the end of June 2022
on the sale by Enel SpA to PJSC Lukoil and the Closed
Combined Mutual Investment Fund “Gazprom-
bank-Frezia” of the entire stake, which was completed
in October 2022;
– the reclassification as “Non-current assets held for
sale” of the investments held in Romanian subsidiar-
ies for a total of €1,649 million as a result of the Ex-
clusivity Agreement signed with the Greek company
Public Power Corporation SA (PPC) in relation to the
potential sale of all equity interests held by the Enel
Group in Romania;
– the impairment losses on the investments in Enel
Green Power SpA (€228 million), Enel Innovation Hubs
Srl (€16 million) and Enel Investment Holding NV (€1
million), and the reversal of the impairment losses
recognized on Enel Global Trading SpA (€162 million)
and Enel Global Services Srl (€1 million);
– the increase in the fair value measurement of the eq-
uity investment in Empresa Propietaria de la Red SA in
the amount of €2 million;
• €11 million from changes in property, plant and equip-
ment and intangible assets, the net result of capital
expenditure and depreciation and amortization for the
year;
• €219 million from the decrease in “Net other non-cur-
rent assets/(liabilities)”, which essentially reflected a de-
crease in non-current derivative liabilities (€637 million)
and in non-current derivative assets (€405 million).
Net working capital, a negative €1,926 million, went even
further negative, by €216 million, compared to December
31, 2021, due to the following:
• €248 million for the negative balance of “Net other cur-
rent assets/(liabilities)” as a result of:
– a decrease in other current assets (€479 million), due
in particular to lower receivables from Group compa-
nies for dividends to be collected;
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
35Performance and financial position of Enel SpA
– an increase in current derivative liabilities (€48 million);
– the increase in other current liabilities (€88 million)
due to the combined effect of higher payables to
Group companies for IRES under the tax consolida-
tion mechanism and the decrease in VAT and income
taxes payable;
– the increase in current derivative assets (€330 million);
• €19 million for the increase in trade receivables, of which
€18 million due from Group companies;
• €13 million for the decrease in trade payables, of which
€67 million due to Group companies.
Net capital employed at December 31, 2022 amounted to
€58,453 million and was funded by equity of €38,342 mil-
lion and net financial debt of €20,111 million.
Equity amounted to €38,342 million, an increase of €3,375
million on the previous year. The change is mainly attribut-
able to net profit for 2022 in the amount of €7,464 million,
the distribution of the dividend for 2021 in the amount of
€0.19 per share (for a total of €1,932 million), as approved
by the Shareholders’ Meeting on May 19, 2022, and the in-
terim dividend for 2022 approved by the Board of Directors
on November 3, 2022, and paid as from January 25, 2023
(€0.20 per share, for a total of €2,033 million).
Net financial debt amounted to €20,111 million at the end
of the year, with a debt-to-equity ratio of 52.4% (66.3% at
the end of 2021).
Analysis of the financial structure
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Long-term debt:
- bank borrowings 1,527 2,508 (981)
- bonds 4,262 4,324 (62)
- other lease financing - 1 (1)
- loans from subsidiaries 12,407 18,739 (6,332)
Long-term debt 18,196 25,572 (7,376)
Long-term loan assets from third parties (4) (3) (1)
Net long-term debt 18,192 25,569 (7,377)
Short-term debt/(liquidity):
- current portion of long-term loans 1,430 216 1,214
- short-term bank borrowings 25 640 (615)
- short-term debt payable to Group companies 3,000 - 3,000
- cash collateral received 365 298 67
Short-term debt 4,820 1,154 3,666
- short-term loans granted to Group companies (512) - (512)
- other short-term financial receivables (5) (9) 4
- cash collateral paid (389) (1,077) 688
- net short-term financial position with Group companies 2,873 (1,486) 4,359
- cash and cash equivalents with banks and short-term securities (4,868) (952) (3,916)
Net short-term debt/(liquidity) 1,919 (2,370) 4,289
NET FINANCIAL DEBT 20,111 23,199 (3,088)
36 Report and financial statements of Enel SpA at December 31, 2022
Net financial debt amounted to €20,111 million, a decrease
of €3,088 million from the previous year, the result of a
decrease of €7,377 million in net long-term financial debt,
partly offset by an increase of €4,289 million in net short-
term financial debt.
The main financial transactions decreasing financial debt
in 2022 were:
• the repayment of a drawing of €1,000 million on a sus-
tainability-linked line of credit during the previous year;
• the early repayment of three Loan Agreements from
Enel Finance International NV (€5,000 million) and the
repayment of two borrowings falling due from Enel Fi-
nance International NV (€118 million);
• the repayment of two short-term bank loans totaling
€400 million and the repayment of short-term revolving
credit lines in the amount of €165 million;
• the €3,000 million drawing on a line of revolving credit
signed in 2022 with Enel Finance International NV;
• the use by Enel Global Trading of a short-term loan
granted in 2022 in the amount of €512 million.
Cash and cash equivalents amounted to €4,868 million, an
increase of €3,916 million on December 31, 2021, mainly at-
tributable to an increase in dividends received from Group
companies during the year.
Please see the section “Cash flows” below for more details.
Cash flows
Millions of euro
2022 2021 Change
Cash and cash equivalents at the beginning of the year 952 2,127 (1,175)
Cash flows from operating activities
(1)
8,689 6,757 1,932
Cash flows from investing activities (1,647) (9,739) 8,092
Cash flows from financing activities
(1)
(3,126) 1,807 (4,933)
Cash and cash equivalents at the end of the year 4,868 952 3,916
(1) The figure for coupons paid to hybrid bond holders has been presented differently from that published in the separate financial statements for 2021.
Cash flows from operating activities in 2022 were a posi-
tive €8,689 million (€6,757 million at December 31, 2021),
up €1,932 million on the previous year, mainly reflecting an
increase in dividends received, partly offset by an increase
in financial expense and in cash requirements connected
with the change in net working capital.
During the year, financing activities absorbed cash flows
of €3,126 million. This mainly reflected the repayment of
long-term borrowing (€10,466 million) and the payment of
dividends (€3,882 million), partly offset by the issue of new
long-term financing (€4,251 million), the net decrease in
financial debt (€7,108 million) and the payment of coupons
to holders of perpetual hybrid bonds (€123 million).
Investing activities absorbed cash flows of €1,647 million
essentially reflecting capital contributions to Enel North
America Inc. (€880 million) and the acquisition of the in-
terest in Enel X Way Srl by Enel X Italia Srl and the sub-
sequent increase in capital by the latter company (totaling
€858 million), partially offset by the liquidity of €137 million
generated by the sale of Enel Russia.
The cash requirements of financing and investing activi-
ties were funded by the cash flows generated by operating
activities in the amount of €8,689 million, resulting in cash
and cash equivalents at year end of €4,868 million.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
37Performance and financial position of Enel SpA
Performance of the main subsidiaries
Millions of euro
Financial
statements Non-current assets Current assets Total assets Non-current liabilities Current liabilities Equity
Total
equity and liabilities
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
Endesa SA Consolidated 30,035 28,316 19,925 11,652 49,960 39,968 23,517 18,602 20,682 15,822 5,761 5,544 49,960 39,968
Enel Américas SA Consolidated 25,307 24,630 7,275 6,235 32,582 30,865 10,681 10,712 7,4 27 6,883 14,474 13,270 32,582 30,865
Enel Chile SA Consolidated 9,680 8,534 3,370 1,315 13,050 9,849 4,738 4,169 3,485 2,211 4,827 3,469 13,050 9,849
Enel Italia SpA Consolidated 38,877 34,767 16,524 13,502 55,401 48,269 27,7 14 20,088 23,942 17,73 9 3,745 10,442 55,401 48,269
Enel North America Inc. Consolidated 14,226 11,295 2,113 1,198 16,339 12,493 6,971 3,671 3,607 4,408 5,761 4,414 16,339 12,493
Enel Energie Muntenia SA Separate 92 84 547 260 639 344 13 17 597 234 29 93 639 344
Enel Energie SA Separate 48 33 628 290 676 323 5 7 647 214 24 102 676 323
Enel Finance International NV Separate 43,871 40,869 17,73 8 8,793 61,609 49,662 41,379 31,259 9,944 8,339 10,286 10,064 61,609 49,662
Enel Grids Srl Separate 75 190 511 403 586 593 26 49 241 519 319 25 586 593
Enel Global Services Srl Separate 144 189 545 568 689 757 33 57 605 669 51 31 689 757
Enel Global Thermal Generation Srl Separate 12 16 99 146 111 162 24 41 81 103 6 18 111 162
Enel Global Trading SpA Separate 830 914 28,008 44,129 28,838 45,043 953 912 27,505 44,714 380 (583) 28,838 45,043
Enel Green Power SpA Separate 1,092 2,153 2,072 1,029 3,164 3,182 1,819 2,023 863 623 482 536 3,164 3,182
Enel Holding Finance Srl Separate 7,872 7,872 2 2 7, 874 7,874 - - - - 7,874 7,874 7,874 7, 874
Enel Iberia SRLU Separate 26,298 26,599 799 1,136 27, 0 97 2 7,73 5 3,046 3,409 616 971 23,435 23,355 27,0 97 2 7,73 5
Enel Innovation Hubs Srl Separate - - 9 26 9 26 - - 2 3 7 23 9 26
Enel Insurance NV Separate 538 453 549 640 1,087 1,093 443 307 133 252 511 534 1,087 1,093
Enel Investment Holding BV Separate 1 2 5 5 6 7 - 1 1 - 5 6 6 7
Enel Romania SA Separate 5 5 19 21 24 26 2 3 17 18 5 5 24 26
Enel X Srl Separate 993 526 183 198 1,176 724 115 114 868 438 193 172 1,176 724
Enel X Way Srl Separate 936 - 46 - 982 - 4 - 160 - 818 - 982 -
Enelpower Srl Separate 2 3 38 38 40 41 6 6 8 9 26 26 40 41
E-Distribuţie Banat SA Separate 424 399 56 87 480 486 150 146 87 64 243 276 480 486
E-Distribuţie Dobrogea SA Separate 379 359 58 53 437 412 135 135 104 50 198 227 437 412
E-Distribuţie Muntenia SA Separate 981 940 212 217 1,193 1,157 379 365 234 158 580 634 1,193 1,157
38 Report and financial statements of Enel SpA at December 31, 2022
Performance of the main subsidiaries
Millions of euro
Financial
statements Non-current assets Current assets Total assets Non-current liabilities Current liabilities Equity
Total
equity and liabilities
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
Endesa SA Consolidated 30,035 28,316 19,925 11,652 49,960 39,968 23,517 18,602 20,682 15,822 5,761 5,544 49,960 39,968
Enel Américas SA Consolidated 25,307 24,630 7,275 6,235 32,582 30,865 10,681 10,712 7,4 27 6,883 14,474 13,270 32,582 30,865
Enel Chile SA Consolidated 9,680 8,534 3,370 1,315 13,050 9,849 4,738 4,169 3,485 2,211 4,827 3,469 13,050 9,849
Enel Italia SpA Consolidated 38,877 34,767 16,524 13,502 55,401 48,269 27,7 14 20,088 23,942 17,73 9 3,745 10,442 55,401 48,269
Enel North America Inc. Consolidated 14,226 11,295 2,113 1,198 16,339 12,493 6,971 3,671 3,607 4,408 5,761 4,414 16,339 12,493
Enel Energie Muntenia SA Separate 92 84 547 260 639 344 13 17 597 234 29 93 639 344
Enel Energie SA Separate 48 33 628 290 676 323 5 7 647 214 24 102 676 323
Enel Finance International NV Separate 43,871 40,869 17,73 8 8,793 61,609 49,662 41,379 31,259 9,944 8,339 10,286 10,064 61,609 49,662
Enel Grids Srl Separate 75 190 511 403 586 593 26 49 241 519 319 25 586 593
Enel Global Services Srl Separate 144 189 545 568 689 757 33 57 605 669 51 31 689 757
Enel Global Thermal Generation Srl Separate 12 16 99 146 111 162 24 41 81 103 6 18 111 162
Enel Global Trading SpA Separate 830 914 28,008 44,129 28,838 45,043 953 912 27,505 44,714 380 (583) 28,838 45,043
Enel Green Power SpA Separate 1,092 2,153 2,072 1,029 3,164 3,182 1,819 2,023 863 623 482 536 3,164 3,182
Enel Holding Finance Srl Separate 7,872 7,872 2 2 7, 874 7,874 - - - - 7,874 7,874 7,874 7, 874
Enel Iberia SRLU Separate 26,298 26,599 799 1,136 27, 0 97 2 7,73 5 3,046 3,409 616 971 23,435 23,355 27,0 97 2 7,73 5
Enel Innovation Hubs Srl Separate - - 9 26 9 26 - - 2 3 7 23 9 26
Enel Insurance NV Separate 538 453 549 640 1,087 1,093 443 307 133 252 511 534 1,087 1,093
Enel Investment Holding BV Separate 1 2 5 5 6 7 - 1 1 - 5 6 6 7
Enel Romania SA Separate 5 5 19 21 24 26 2 3 17 18 5 5 24 26
Enel X Srl Separate 993 526 183 198 1,176 724 115 114 868 438 193 172 1,176 724
Enel X Way Srl Separate 936 - 46 - 982 - 4 - 160 - 818 - 982 -
Enelpower Srl Separate 2 3 38 38 40 41 6 6 8 9 26 26 40 41
E-Distribuţie Banat SA Separate 424 399 56 87 480 486 150 146 87 64 243 276 480 486
E-Distribuţie Dobrogea SA Separate 379 359 58 53 437 412 135 135 104 50 198 227 437 412
E-Distribuţie Muntenia SA Separate 981 940 212 217 1,193 1,157 379 365 234 158 580 634 1,193 1,157
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
39Performance of the main subsidiaries
Millions of euro
Financial
statements Revenue Costs
Gross operating
profit/(loss)
Amortization,
depreciation and
impairment losses Operating profit/(loss)
Net financial income/
(expense) and income/
(expense) from equity
investments Pre-tax profit/(loss) Income taxes
Profit/(Loss) for the
year
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
Endesa SA Consolidated 32,896 20,899 27,331 16,621 5,565 4,278 1,878 2,322 3,687 1,956 (200) (32) 3,487 1,924 891 467 2,596 1,457
Enel Américas SA Consolidated 14,933 13,689 10,352 10,221 4,581 3,468 2,529 1,217 2,052 2,251 (967) (611) 1,085 1,640 797 682 288 958
Enel Chile SA Consolidated 5,402 3,180 4,122 2,599 1,280 581 286 293 994 288 944 (160) 1,938 128 512 17 1,426 111
Enel Italia SpA Consolidated 58,033 34,833 51,849 28,241 6,184 6,592 3,039 3,831 3,145 2,761 (649) 369 2,496 3,130 1,586 825 910 2,305
Enel North America Inc. Consolidated 2,103 1,477 1,211 867 892 610 418 337 474 273 (186) (132) 288 141 97 28 191 113
Enel Energie Muntenia SA Separate 1,343 682 1,394 715 (51) (33) 14 12 (65) (45) (12) 1 (77) (44) (10) (6) (67) (38)
Enel Energie SA Separate 1,480 700 1,547 699 (67) 1 14 13 (81) (12) (10) 2 (91) (10) (12) (1) (79) (9)
Enel Finance International NV Separate 1,667 1,012 1,561 2,113 106 (1,101) - - 106 (1,101) (42) 186 64 (915) 20 (175) 44 (740)
Enel Grids Srl Separate 690 504 422 511 268 (7) 2 - 266 (7) (5) (1) 261 5 (31) (5) 292 10
Enel Global Services Srl Separate 908 959 819 936 89 23 68 64 21 (41) 1 (3) 22 (44) 8 (9) 14 (35)
Enel Global Thermal Generation Srl Separate 101 116 112 133 (11) (17) 1 1 (12) (18) 1 (1) (11) (19) 2 (1) (13) (18)
Enel Global Trading SpA Separate 82,598 23,680 82,464 23,547 134 133 32 23 102 110 (52) (56) 50 54 62 57 (12) (3)
Enel Green Power SpA Separate 449 286 309 288 140 (2) 596 (40) (456) 38 378 (39) (78) (1) 36 (11) (114) 10
Enel Holding Finance Srl Separate - - - - - - - - - - - - - - - - - -
Enel Iberia SRLU Separate 40 33 39 37 1 (4) (1) (1) 2 (3) 672 7,70 6 674 7,703 (51) 83 725 7,6 2 0
Enel Innovation Hubs Srl Separate 6 6 6 6 - - - - - - - - - - - - - -
Enel Insurance NV Separate 149 119 149 106 - 13 - - - 13 7 8 7 21 2 5 5 16
Enel Investment Holding BV Separate 1 2 2 2 (1) - - 1 (1) (1) - - (1) (1) - - (1) (1)
Enel Romania SA Separate 12 15 11 13 1 2 - 1 1 1 - - 1 1 - - 1 1
Enel X Srl Separate 203 112 126 118 77 (5) 43 13 34 (18) (3) (4) 31 (22) (23) (5) 54 (17)
Enel X Way Srl Separate 47 - 53 - (6) - 17 - (23) - 4 - (19) - (4) - (15) -
Enelpower Srl Separate - - - - - - - - - - - - - - (1) - 1 -
E-Distribuţie Banat SA Separate 228 116 254 96 (26) 20 43 23 (69) (3) - - (69) (3) (10) - (59) (3)
E-Distribuţie Dobrogea SA Separate 134 108 151 85 (17) 23 18 19 (35) 4 (3) - (38) 4 (6) 1 (32) 3
E-Distribuţie Muntenia SA Separate 148 194 167 149 (19) 45 21 48 (40) (3) (1) 1 (41) (2) (4) 1 (37) (3)
40 Report and financial statements of Enel SpA at December 31, 2022
Millions of euro
Financial
statements Revenue Costs
Gross operating
profit/(loss)
Amortization,
depreciation and
impairment losses Operating profit/(loss)
Net financial income/
(expense) and income/
(expense) from equity
investments Pre-tax profit/(loss) Income taxes
Profit/(Loss) for the
year
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
Endesa SA Consolidated 32,896 20,899 27,331 16,621 5,565 4,278 1,878 2,322 3,687 1,956 (200) (32) 3,487 1,924 891 467 2,596 1,457
Enel Américas SA Consolidated 14,933 13,689 10,352 10,221 4,581 3,468 2,529 1,217 2,052 2,251 (967) (611) 1,085 1,640 797 682 288 958
Enel Chile SA Consolidated 5,402 3,180 4,122 2,599 1,280 581 286 293 994 288 944 (160) 1,938 128 512 17 1,426 111
Enel Italia SpA Consolidated 58,033 34,833 51,849 28,241 6,184 6,592 3,039 3,831 3,145 2,761 (649) 369 2,496 3,130 1,586 825 910 2,305
Enel North America Inc. Consolidated 2,103 1,477 1,211 867 892 610 418 337 474 273 (186) (132) 288 141 97 28 191 113
Enel Energie Muntenia SA Separate 1,343 682 1,394 715 (51) (33) 14 12 (65) (45) (12) 1 (77) (44) (10) (6) (67) (38)
Enel Energie SA Separate 1,480 700 1,547 699 (67) 1 14 13 (81) (12) (10) 2 (91) (10) (12) (1) (79) (9)
Enel Finance International NV Separate 1,667 1,012 1,561 2,113 106 (1,101) - - 106 (1,101) (42) 186 64 (915) 20 (175) 44 (740)
Enel Grids Srl Separate 690 504 422 511 268 (7) 2 - 266 (7) (5) (1) 261 5 (31) (5) 292 10
Enel Global Services Srl Separate 908 959 819 936 89 23 68 64 21 (41) 1 (3) 22 (44) 8 (9) 14 (35)
Enel Global Thermal Generation Srl Separate 101 116 112 133 (11) (17) 1 1 (12) (18) 1 (1) (11) (19) 2 (1) (13) (18)
Enel Global Trading SpA Separate 82,598 23,680 82,464 23,547 134 133 32 23 102 110 (52) (56) 50 54 62 57 (12) (3)
Enel Green Power SpA Separate 449 286 309 288 140 (2) 596 (40) (456) 38 378 (39) (78) (1) 36 (11) (114) 10
Enel Holding Finance Srl Separate - - - - - - - - - - - - - - - - - -
Enel Iberia SRLU Separate 40 33 39 37 1 (4) (1) (1) 2 (3) 672 7,70 6 674 7,703 (51) 83 725 7,6 2 0
Enel Innovation Hubs Srl Separate 6 6 6 6 - - - - - - - - - - - - - -
Enel Insurance NV Separate 149 119 149 106 - 13 - - - 13 7 8 7 21 2 5 5 16
Enel Investment Holding BV Separate 1 2 2 2 (1) - - 1 (1) (1) - - (1) (1) - - (1) (1)
Enel Romania SA Separate 12 15 11 13 1 2 - 1 1 1 - - 1 1 - - 1 1
Enel X Srl Separate 203 112 126 118 77 (5) 43 13 34 (18) (3) (4) 31 (22) (23) (5) 54 (17)
Enel X Way Srl Separate 47 - 53 - (6) - 17 - (23) - 4 - (19) - (4) - (15) -
Enelpower Srl Separate - - - - - - - - - - - - - - (1) - 1 -
E-Distribuţie Banat SA Separate 228 116 254 96 (26) 20 43 23 (69) (3) - - (69) (3) (10) - (59) (3)
E-Distribuţie Dobrogea SA Separate 134 108 151 85 (17) 23 18 19 (35) 4 (3) - (38) 4 (6) 1 (32) 3
E-Distribuţie Muntenia SA Separate 148 194 167 149 (19) 45 21 48 (40) (3) (1) 1 (41) (2) (4) 1 (37) (3)
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
41Performance of the main subsidiaries
People centricity
Enel SpA employees at December 31, 2022 numbered 889.
In 2022, the number of employees increased by 55, reflect-
ing the net balance between new hires and terminations.
The following table reports the average number of employ-
ees by category with comparative figures for the previous
year, as well as the headcount at December 31, 2022.
No. Average workforce Headcount
2022 2021 Change at Dec. 31, 2022
Senior managers 154 148 6 164
Middle managers 449 417 32 481
Office staff 261 246 15 244
Total 864 811 53 889
The following table reports changes in the workforce dur-
ing the year.
Headcount at Dec. 31, 2021 New hires Terminations Inward transfers Outward transfers Balance at Dec. 31, 2022
834 39 27 153 110 889
Training and development
The rapid, ongoing evolution of our business and the sup-
port of our strategy for a fair transition have resulted in a
need for new technical and professional skills and led to the
natural obsolescence of others. Within this landscape, on-
going employee training, along with strategies of upskilling,
aimed at developing training and empowerment programs
to improve performance within a given role, and reskilling,
aimed at learning new skills and capabilities that enable
people to fill new positions, are of increasing importance.
In 2022, in support of these strategies, we provided a total
of about 3.1 million hours of training, up from the previ-
ous year (about 2.9 million hours in 2021), an average of
approximately 47 hours per employee (vs. more than 44
hours per employee in 2021). This was made possible by
the upgrading of digital tools and the E-Ducation platform,
which ensured broad access to content and expanded the
culture of digitalization for learning, including remotely. In
Italy, we signed a remote-work agreement that allows em-
ployees in roles that can be performed remotely to work
remotely for up to 60% of their total work days, with the
option to increase that percentage in certain cases. This
capacity for flexibility and resilience leverages our consoli-
dated experience with flexible working, which began in Italy
as early as 2016 and then gradually spread throughout the
Group, and the technological and digital transformation of
corporate strategy that has made Enel the world’s first ma-
jor utility company to fully embrace the cloud model.
In addition to training and awareness initiatives to accom-
pany the adoption of fully digital modes of work, we have
continued training programs related to conduct, technical
issues, safety, reskilling, and the digital culture.
In line with the Group’s commitment, the training budget
has been increased compared with the previous year, with
total training costs incurred in 2022 coming to about €30
million (about €20 million in 2021).
In 2022, with regard to the development and assessment
of Enel’s people, we continued with the program Open
Feedback Evaluation (OFE), a mechanism for the constant,
360° gathering of feedback from all employees, thereby
creating an ongoing dialogue within the organization.
The new OFE model is made up of three interdependent
dimensions: “Talent”, which highlights an individual’s skills
related to the four Open Power values of Trust, Responsi-
bility, Innovation and Proactivity; “Generosity”, meaning a
propensity for interacting with others; and “Action”, i.e., the
ability, as assessed by both superiors and peers, to achieve
professional objectives.
With a view to promoting and developing individuali-
ty, mechanisms such as job shadowing, mentoring and
coaching are available to increase awareness of and ex-
press one’s talents, while promoting a climate of inclusive-
ness and active listening. This year, 667 employees world-
wide were involved in mentoring initiatives (325 mentees
and 342 mentors).
42 Report and financial statements of Enel SpA at December 31, 2022
Finally, with regard to acknowledging the value of people,
we made the transition in 2022 from a system based on
assessments for entering management positions to the
development of a program of empowerment that helps
people to be more aware of their specific talents, atti-
tudes, preferences and aspirations, while supporting them
in more complex roles within the organization.
Within this context, new selection criteria have been in-
troduced into the annual plan of management succession
aimed at greater inclusiveness and at valuing diversity.
More specifically, we have removed the age limit for eligi-
bility in the succession plan and introduced a parameter
than ensures at least 50% of all successors are women,
while also incentivizing the inclusion of office staff among
the appointments.
Open Listening and organizational wellness
At the end of 2022, we issued a new Open Listening survey
concerning the organization’s global corporate climate.
The 2022 survey was completed by 75.6% of all Group em-
ployees, and the overall job-satisfaction rate was 89.6%.
The goal of the survey is to measure employee wellness
and job satisfaction through active listening in a number
of areas of importance to the organization (including work-
life balance, networking, training, diversity and inclusion).
In addition, in 2021, Enel worked with employees to create
a global well-being model founded on eight pillars with an
impact on overall satisfaction, namely: emotional, physical,
social, ethical, financial and cultural well-being, work-life
harmony, and sense of protection. To measure wellness
and understand what is of greatest importance to peo-
ple, a global well-being survey has been conducted. The
results of the 2021 survey, which was repeated in October
2022 with the added dimension of motivation, led to the
preparation and launch of the 2022 Global Wellness Pro-
gram involving a diverse, multicultural team. The program
is intended for all Enel employees and features an expe-
rience that is both physical and digital. As for results, the
surveys measured an overall sense of wellness, worldwide,
of 60%, meaning that 60% of all those surveyed reported
feeling average to high levels of satisfaction with their own
wellness.
Including diversity at Enel
At Enel, inclusion, wellness, engagement and value cre-
ation are fundamental aspects of our approach with our
people. Our approach to diversity and inclusion is based
on the principles of non-discrimination, equal opportuni-
ties, personal dignity, inclusion regardless of any form of
diversity, and work-life balance. This approach is embodied
in an organic set of actions that promote an attention to
and expression of individuality, a culture of inclusiveness
without prejudice, and a coherent mix of talents, qualities
and experience, all of which creates value for our people
and for our business.
The approach has been ratified in our Charter for the Indi-
vidual, a protocol of intent that Enel signed on March 29,
2022, underscoring the importance of personal well-being
and integrity to a healthy, safe, motivating and engaging
ecosystem able to express its full potential.
This is an innovative protocol, a new model designed in
this unprecedented era of uncertainty due to the COVID
pandemic, which has transformed working relationships
and has presented us with an extraordinary opportunity
for change, capping off a cultural transformation at Enel
that had already begun some time before. In processes of
digital, cultural and energy transition, people are the key
to our success – our true competitive advantage. Man-
aging these times of rapid change calls for inclusiveness,
especially in the workplace. It is out of this awareness that
our Charter of the Person aims to value the individual as a
key player in an ecosystem in which the Company and the
trade unions work together to create a healthy, safe, mo-
tivating and engaging workplace – a workplace in which
wellness, productivity, continuous learning, and safety can
work in concert towards the complete fulfillment of the in-
dividual, with an ever greater role for, and hence account-
ability of, the person.
The milestones that have brought us to today began back in
2013 with publication of our Human Rights Policy. This was
followed, in 2015, by Enel’s adoption of the seven Wom-
en’s Empowerment Principles (WEPs) promoted by the UN
Global Compact and UN Women and the parallel publi-
cation of the Diversity and Inclusion Policy, which defines
the principles of non-discrimination, equal opportunities,
dignity, work-life balance, and inclusiveness regardless of
any form of diversity. In 2019, our Workplace Harassment
Policy introduced the issues of individual respect, integ-
rity and dignity in the workplace into the prevention of all
types of harassment, and these principles were dissemi-
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
43People centricity
nated in 2020 when we published online Enel’s Statement
Against Harassment in the workplace.
(1)
In 2021, we issued
our global Policy on Digital Accessibility to ensure equal
opportunities in access to digital systems and information.
In recent years, intensive awareness efforts have led to the
dissemination and strengthening of a culture of inclusion
at all levels and in all settings within the organization by way
of communication campaigns and local and global events
focused on a range of issues. Of note among the most
important initiatives in 2022 are the actions dedicated to
having a systemic impact on various aspects of the gender
gap and the inclusion of disabilities, new global initiatives
of STEM awareness, projects to support the vulnerable,
initiatives related to cultural diversity in various countries,
and events to raise awareness of the concept of individu-
ality and uniqueness. In particular, we organized the global
event YOUniqueness Makes the Difference aimed at ex-
ploring the concept of individual uniqueness in relation-
ships and in the organization, and we completed the provi-
sion of training throughout the Group entitled Beyond Bias
and Harassment in the Workplace.
Promoting a culture of inclusiveness at Enel also involves
target setting and measurement. It is an approach that is
encapsulated in an organic plan of actions measured by
way of a broad set of KPIs subject to commitments ap-
proved by the corporate boards and published in the Sus-
tainability Report and Plan. These commitments include:
balancing the percentage of women in hiring processes;
increasing the representation of women in senior and
middle management and in succession plans; increasing
the number of female students involved in STEM-aware-
ness initiatives; and promoting projects for the inclusion
of employees with disabilities at all stages of the employee
journey.
More specifically, in terms of gender equality, company
strategy is organized into various lines of action. We are
working to increase the presence of women in hiring pro-
cesses, reaching 52.2% in 2022 (52.1% in 2021) and con-
tinuing the upward trend of the last five years. In terms of
women in management positions, we have seen both the
number and the percentage of female managers contin-
ue to climb, increasing by 1.3 percentage points in 2022
(from 23.6% in 2021 to 24.9% in 2022). Actions to value the
contribution of women throughout the organization, and
not just in senior positions, have also continued, and the
effects of these efforts will be better seen over the me-
dium to long term, due in part to generational dynamics.
Among the actions taken globally, the performance target
(1) https://www.enel.com/content/dam/enel-com/documenti/investitori/sostenibilita/enel-statement-against-harassment.pdf.
(2) Beginning in 2022, the figure only includes initiatives targeting primary and secondary schools.
for the percentage of women in top management succes-
sion plans has been confirmed for 2024 targets under the
Long-Term Incentive Plans, and the weighting has been in-
creased from 5% to 10% of the total in order to lend great-
er continuity to a policy to establish a suitable platform for
management appointments into the near future.
Over the years, we have also increased our commitment
to promote the presence of women in Science, Technol-
ogy, Engineering and Math (STEM) training and careers in
collaboration with schools and government, so as to over-
come gender stereotypes and promote the importance
of STEM and its integration with the humanities. These
STEM awareness and orientation initiatives reached near-
ly 10,000 female secondary-school students in 2022 and
more than 30,000 female students over the last six years.
(2)
On the issue of disabilities, Enel provides equipment, ser-
vices, working methods and other initiatives to create an
inclusive climate for work and relationships for all that
provides full autonomy at work regardless of the disability.
Worldwide, we have 2,129 employees with disabilities. The
issue is particularly relevant in Italy (with 1,568 employees
with disabilities, about 74% of the Group total).
With Enel’s participation in the global “Valuable 500” in-
itiative in 2019, the issue became one of great interest,
leading, in 2020, to the launch of the global project “Value
for Disability”, aimed at seizing potential business and pro-
moting inclusion among employees and customers with
disabilities by designing specific global and local plans of
action. Every country with at least one employee with a dis-
ability has a focal point for hearing and responding to spe-
cific needs and designing dedicated actions, as stated in
the Diversity and Inclusion Policy. Many countries have also
organized initiatives focused on intercultural and intergen-
erational issues and on the LGBTQ+ community.
Finally, to promote care for all people who find themselves
in circumstances that have had an impact on work, the
MaCro@Work Caring Program for employees with chronic
disorders and the Parental Program to support parenting
throughout the Group are continuing in the various coun-
tries to which they have been extended.
The table below shows Enel’s commitment to diversity and
inclusion, including the percentage of employees with dis-
abilities, the number of women in senior and middle man-
agement, and the ratio of the average salaries of women
to those of men.
44 Report and financial statements of Enel SpA at December 31, 2022
Diversity and inclusion
2022 2021 Change
Disabled personnel or personnel belonging to protected categories % 3.3 3.2 0.1 3.1%
Women in senior and middle management no. 4,462 4,163 299 7. 2 %
Percentage of women in senior and middle management % 31.8 30.6 1.2 3.9%
Percentage of women in management succession plans % 46.1 42.7 3.4 8.0%
Percentage of women in senior management succession plans % 50 - 50 -
Base salary and remuneration ratios
Ratio of base salary women-to-men: % 104.7 104.8 -0.1 -0.1%
- senior manager % 83.9 84.6 -0.7 -0.8%
- middle manager % 92.8 94.2 -1.4 -1.5%
- office staff % 88.8 88.4 0.4 0.5%
- blue collar % 125.0 111.2 13.8 12.4%
Ratio of base remuneration women-to-men: % 105.4 105.1 0.3 0.3%
- senior manager % 80.7 81.1 -0.4 -0.5%
- middle manager % 91.9 93.2 -1.3 -1.4%
- office staff % 89.3 88.4 0.9 1.0%
- blue collar % 125.4 112.0 13.4 12.0%
Workplace health and safety
The mental and physical health and safety of our people
are the most important thing to protect at Enel in all areas
of life. It is precisely in this view that Enel is committed to
developing and promoting a strong culture of safety that
ensures we provide a healthy workplace that is free from
hazards for all who work with and for the Group.
The constant commitment of us all, the integration of
safety both in our processes and in our training, the re-
porting and analysis events, rigor in the selection and
management of contractors, constant control over qual-
ity, the sharing of experience, and benchmarking against
the leading international players are all cornerstones to our
culture of safety.
Ensuring the health and safety of our people is a respon-
sibility for all who work at Enel. This is why, as established
in the Group’s Stop Work Policy, both employees and con-
tractors are required to stop any work immediately that
could put the health and safety of themselves or other at
risk or, similarly, that could harm the environment or com-
promise the quality of any of its component parts.
Each of the Group’s business line has its own ISO 45001
compliant Health and Safety Management System. This
management system centers around the identification of
hazards, the qualitative and quantitative assessment of
risks, the planning and implementation of preventive and
protective measures and the verification of their effica-
cy, the implementation of any corrective action, and the
preparation of the operating teams.
The following table reports the main workplace safety in-
dicators:
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
45People centricity
2022 2021 2022-2021
Hours worked millions of hours 42 7.8 47 423.362 4.486 1.1%
Enel millions of hours 123.624 123.421 0.203 0.2%
Contractors millions of hours 304.223 299.940 4.282 1.4%
Total Recordable Injuries (TRI)
(1)
no. 962 1,212 (250) -20.6%
Enel no. 153 157 (4) -2.5%
Contractors no. 809 1,055 (246) -23.3%
Total Recordable Injury Frequency Rate (TRI FR)
(2)
i 2.25 2.86 (0.61) -21.3%
Enel i 1.25 1.27 (0.02) -1.6%
Contractors i 2.66 3.52 (0.86) -24.4%
Fatal Injuries (FAT) no. 6 9 (3) -33.3%
Enel no. 1 3 (2) -66.7%
Contractors no. 5 6 (1) -16.7%
Fatal Injury Frequency Rate (FAT FR) i 0.014 0.021 (0.007) -33.3%
Enel i 0.008 0.024 (0.016) -66.7%
Contractors i 0.016 0.020 (0.004) -20.0%
Life Changing Accidents (LCA)
(3)
no. 2 4 (2) -50.0%
Enel no. - 1 (1) -
Contractors no. 2 3 (1) -33.3%
Life Changing Accidents (LCA) frequency rate i 0.005 0.009 (0.004) -44.4%
Enel i - 0.008 (0.008) -
Contractors i 0.007 0.010 (0.003) -30.0%
Lost Time Injury Rate with days lost (ACC>3 FR)
(4)
i 0.36 0.43 (0.07) -16.3%
Enel i 0.48 0.49 (0.01) -2.0%
Contractors i 0.31 0.40 (0.09) -22.5%
Lost Time Injury Frequency Rate with days lost (LTI FR)
(5)
i 0.50 0.65 (0.15) -23.1%
Enel i 0.56 0.68 (0.12) -17.6 %
Contractors i 0.48 0.64 (0.16) -25.0%
High Potential Accidents Frequency Rate (HPO FR)
(6)
i 0.072 0.094 (0.022) -23.4%
Enel i 0.057 0.065 (0.008) -12.3%
Contractors i 0.079 0.107 (0.028) -26.2%
(1) Total Recordable Injuries (TRI): this includes all incidents that have caused injuries, including lost time injuries, incidents requiring the administration of first
aid, or incidents that did not result in lost time.
(2) Total Recordable Injury Frequency Rate (TRI FR): as for all the frequency rates for the various types of incidents, this is calculated as the ratio of number of
events to total hours worked (in millions).
(3) Life Changing Accidents (LCAs): injuries whose health consequences caused permanent changes in the life of the individual (e.g., amputation of a limb, pa-
ralysis, extensive and visible scarring, etc.). Beginning with the 2021 reporting cycle, the metric Life Changing Accidents replaced High Consequence Injuries
following efforts to standardize safety reporting within the organization. Therefore, the figures for 2020 and 2019 have been recalculated in line with this new
approach.
(4) Lost Time Injury Rate with days lost is calculated considering accidents in which the worker lost at least three days of work.
(5) Lost Time Injury Frequency Rate (LTI FR): all injuries that have resulted in at least one day of absence from work shown as a ratio to total hours worked (in
millions).
(6) High Potential Accidents Frequency Rate (HPO FR): all injuries the characteristics of which have a high potential for causing a life-changing or fatal event,
shown as a ratio to total hours worked (in millions).
Compared with the previous year, 2022 shows a significant
reduction in all injury indicators, while the total number of
hours worked has remained nearly constant (+1.1%).
In 2022, the Total Recordable Injury Frequency Rate (TRI
FR) decreased from 2021 by 21.3% to about 2.2 inju-
ries per million hours worked. This reduction is seen in
both Enel employees (-1.6%) and in contractor personnel
(-24.4%).
46 Report and financial statements of Enel SpA at December 31, 2022
Responsible relations with communities
No. (million) 2022 2021 Change
Access to accessible and clean energy 15.6 13.2 2.4
Quality, fair and inclusive education 3.7 3.0 0.7
Decent work and economic growth 4.9 3.7 1.2
Establishing solid and lasting relationships with local com-
munities in the countries in which Enel operates is a fun-
damental pillar of the Group’s strategy, underpinning a
model of development and management of the business
that leaves no one behind and creates long-term shared
value for all stakeholders. This model has been incorporat-
ed along the entire value chain and is divided into six main
steps such as the analysis of the contexts already in the in-
itial phase of the business projects, the mapping and anal-
ysis of stakeholders and their priorities, the development
of the materiality matrix to then plan and manage sustain-
ability projects, which are evaluated at different stages of
project implementation. Models of sustainable construc-
tion sites and plants are also included in the approach. A
further evolution has been the extension of this approach
to the design, development and supply of energy services
and products, as well as in the innovation of processes by
using new technologies and helping to build increasingly
circular, inclusive and sustainable communities.
In line with the Sustainable Development Goals (SDGs), Enel
makes a concrete contribution to the sustainable progress
of the territories in which it operates. This commitment
is fully integrated into our purpose and corporate values,
from the expansion of infrastructure to education and vo-
cational training programs, and projects to support cultur-
al and economic activities. Specific initiatives have been
designed to promote access to energy with rural and sub-
urban electrification, addressing energy poverty and pro-
moting social inclusion for the most vulnerable segments
of the population, also using new technologies and circu-
lar economy approaches and adopting a strategy that fully
incorporates sustainability into our business model and
activities. Various initiatives have been developed globally
for the protection of biodiversity, in line with the Group’s
decarbonization strategy.
There are two major challenges in particular: the equitable
and sustainable transition and the post-pandemic recov-
ery.
The energy transition represents an important acceler-
ator of growth and modernization of industry, thanks to
the potential it offers in terms of economic development,
well-being, quality of life and equality. Far-sighted poli-
cies are necessary to seize these opportunities, ensuring
a just and inclusive transition and taking particular account
of the needs of the social categories most exposed to
change. Enel is convinced that in order to generate lasting
profit, value must be shared with the entire environment in
which it operates.
With the continuation of the COVID-19 pandemic, our
commitment to support communities has also continued,
with the activation of specific initiatives to sustain so-
cio-economic recovery through the development of local
marketplaces, facilitating access to credit and promoting
inclusive business models to support the weaker segments
of the population, with particular attention to people in
physically, socially and economically vulnerable positions.
Many digitalization projects have also been undertaken to
support connectivity in rural areas, computer literacy, the
participation of women in STEM fields, the development of
e-commerce platforms and online or offline solutions with
a positive impact on local economies.
In 2022, Enel developed over 2,300 sustainability projects
involving more than 6.3 million beneficiaries in the coun-
tries in which Enel operates. In line with the SDGs, the
projects concern activities such as the expansion of in-
frastructure, vocational education and training programs,
projects to support cultural and economic activities, pro-
motion of access to energy, rural and suburban electrifi-
cation, addressing energy poverty and the promotion of
social inclusion for the most vulnerable categories of the
population. A fundamental lever in the realization of these
projects is the use of over 1,200 active international part-
nerships with non-profit organizations, social enterprises,
startups and institutions with close ties to the area.
An approach that leads to the implementation of a wide
range of projects in different areas, thanks in part to the
activation of virtuous ecosystems such as the Open Innov-
ability
®
platform, which is based on openness and sharing,
facilitating and promoting the identification of innovative
social ideas and solutions.
The involvement of local communities is essential to devel-
op a constructive dialogue that can actively contribute to
facing the challenges posed by the social impacts of the
decarbonization of the economy and to identify effective
measures to respond to local needs in synergy with corpo-
rate objectives.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
47People centricity
Sustainable supply chain
2022 2021 Change
Active suppliers no. 20,434 11,311 9,123 80.7%
Suppliers (FTE) no. 172,854 170,421 2,433 1.4%
Qualified suppliers assessed for ESG issues % 99 99 - -
Qualified suppliers assessed for social issues (including human
rights and health and safety) for all goods categories
% 99 99 - -
Qualified suppliers assessed for environmental issues for all goods
categories
% 99 99 - -
At Enel, purchasing processes are based on conduct ori-
ented towards reciprocal good faith, transparency and col-
laboration. Suppliers are asked not only to meet the nec-
essary quality standards but also to commit themselves to
adopting best practices in the fields of human rights and
the environment.
This is pursued within clear references to codes of con-
duct, including the Group’s Human Rights Policy, the Code
of Ethics, the Zero-Tolerance-of-Corruption Plan and
global compliance programs.
In 2022 we signed agreements with a total of more than
6,213 vendors.
Assessments of environmental, social and governance
aspects are conducted at all procurement phases, i.e.,
in the qualification phase, in the tender and contracting
process and in the performance monitoring phase. Enel’s
global vendor qualification system (with about 31,400 ac-
tive qualifications at December 31, 2022) enables us to
accurately assess businesses that intend to participate
in tender processes through the analysis of compliance
with technical, financial, legal, environmental, human and
ethical rights, including health and safety, and integrity re-
quirements. The company must continue to meet these
requirements throughout the duration of their qualifica-
tion. Accordingly, companies already included in Enel’s
Register of Qualified Suppliers are constantly monitored
for events involving both the company itself and its main
officers, mainly through the use of external databases. As
regards the tendering and bargaining process, in line with
Enel’s commitment to introduce sustainability issues in
tendering processes, the Company has adopted a struc-
tured process for defining “sustainability requirements and
rewarding factors (K)” which can be used by the various
purchasing and monitoring units throughout the period
of execution of the contract. The process provides for the
presence of two “Libraries”, which catalog all the sustain-
ability requirements and Ks grouped into environmental,
social, certification and circularity macro-categories. Fur-
thermore, specific contractual clauses have been defined,
which are included in all works, service and supply con-
tracts and updated periodically, to take account of various
regulatory developments and ensure alignment with inter-
national best practices.
The general terms of contract refer to the current regula-
tions on pay, contributions, insurance and taxation for all
workers employed in any capacity in the execution of the
contract by the supplier. Furthermore, the principles and
legal requirements referred to in the relevant ILO Conven-
tions are explicitly referred to: equal treatment, prohibi-
tion of discrimination, abuse and harassment; trade union
freedom, association and representation; refusal of forced
labor; safety and environmental protection and sanitation
conditions. In the event of conflict between regulatory
sources, the more restrictive shall prevail. Vendor perfor-
mance is evaluated and monitored throughout the pro-
curement process. More specifically, monitoring systems
used during the execution of the contract include Supplier
Performance Management (SPM), whose objective within
our collaboration with vendors is not only to undertake
any corrective actions in the contract execution phase,
but also to encourage a process of improvement using
actions that reward the adoption of best practices. The
process is based on an objective and systematic collection
of data and information relating to the execution of the
service covered by the contract. These data are used to
produce specific indicators, also called categories (Quality,
Punctuality, Health and Safety, Environment, Human Rights
& Correctness, Innovation & Collaboration), which, when
combined in a weighted average, represent the Supplier
Performance Index (SPI).
Through the SPM process, 701 goods categories and 7,666
vendors were monitored in the last year (compared with
698 goods categories and some 6,782 vendors in 2021).
Meetings with suppliers continued in 2022 with a focus on
sustainability issues, with specific reference to the protec-
tion of health and safety, as indispensable partners for sus-
tainable progress in the entire context in which the Group
operates.
48 Report and financial statements of Enel SpA at December 31, 2022
Research and development
Enel SpA does not directly engage in research and devel-
opment, as within the Group those activities are performed
by a number of subsidiaries and associates.
Innovation
In line with the Open Power vision, the Group promotes
an open innovation approach to address the challenges of
the energy transition. The Open Innovation model makes it
possible to connect all areas of the Company with startups,
industrial partners, small and medium-sized enterprises
(SMEs), research centers, universities and entrepreneurs –
drawing in part on crowdsourcing platforms – to face the
challenges of the business, taking into account the drivers
of the Group’s Strategic Plan. The Company has numerous
innovation partnership agreements that, in addition to the
traditional fields of action linked to renewable energy and
conventional generation, have promoted the development
of new solutions for e-mobility, microgrids, energy effi-
ciency and the industrial Internet of Things (IoT).
Enel’s innovation strategy leverages the online crowd-
sourcing platform openinnovability.com and a global net-
work of 10 Innovation Hubs (3 of which are also Labs) and
22 Labs (3 of which are dedicated to startups), which con-
solidates the new model of collaboration with startups and
SMEs. The latter offer innovative solutions and new busi-
ness models and Enel makes its expertise, testing facilities
and a global network of partners available to support its
development and possible scale-up. The Hubs are located
in the most relevant innovation ecosystems for the Group
(Catania, Pisa, Milan, Silicon Valley, Boston, Rio de Janeiro,
Madrid, Barcelona, Santiago de Chile, Tel Aviv). They man-
age relationships with all the players involved in innovation
activities and constitute the main source of scouting for
innovative startups and SMEs, responding to the innova-
tion needs manifested by business lines. In September
2022 Enel inaugurated the new AI & Robotics Lab in Tel Aviv,
specializing in the development of artificial intelligence and
robotics for renewable energy and electricity grids.
Furthermore, in 2022, Enel was one of the first companies
in the world to voluntarily adopt the ISO 56002 standard for
innovation management. The ISO 56002 standard is part
of the broader ISO 56000 series of standards and covers
all aspects of innovation management: from the birth of an
idea to its implementation on a global scale. It enables you
to enhance the effectiveness of innovation and business
opportunities, creating the conditions for a widespread
culture of innovation that stimulates the creativity of em-
ployees and stakeholders and fosters the emergence of
new value propositions in line with market developments.
Last year, the integration of Open Innovation Culture and
Agile Transformation was launched at the Group level with
the aim of providing the business with comprehensive
support, from the generation of the idea to the project im-
plementation phase, using Innovation and Agile methodol-
ogies as key drivers to create competitive advantage and
generate cost optimization over time.
2022 saw the continuation of the activities of the innova-
tion communities, multidisciplinary working groups creat-
ed to innovatively address the most relevant issues for the
business and new technologies in order to create value for
the Group. To the existing communities of energy storage,
blockchain, drones, energy accumulation, metaverse, ro-
botics, sensors and quantum computing, other innovation
communities have been added, including wearables, ad-
ditive manufacturing, data monetization, artificial intelli-
gence and machine learning, materials and hydrogen. The
communities continuously monitor potential technological
improvements or share useful new business models, val-
ue-added services or use cases for types of technology
that could be implemented in different areas of the Enel
Group.
As part of innovation activities, 194 Proofs of Concept were
launched in 2022 (168 in 2021) to test innovative solutions,
while 60 innovative solutions (46 in 2021) are in the scale-
up phase and €104.5 million have been invested (including
personnel costs) in innovation.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
49Research and development
Digitalization
In 2022, innovation activities in the field of cyber security
benefited from the network of Innovation Hubs, as well as
from their portfolio of startups and partnerships forged at
the Group level.
These interconnections have enabled the sharing of best
practices and operating models, as well as the construc-
tion and enhancement of info-sharing channels.
The main initiatives in this area are reported below:
• analysis of solutions based on Quantum Key Distribution
and Quantum safe encryption algorithms to enhance
understanding of how to remedy current encryption
models under threat from the future increase in compu-
tational capacity offered by quantum computing;
• software development support services and solutions to
analyze open source code and third-party software li-
braries, both from the point of view of any vulnerabilities
and from the point of view of user licenses;
• analysis of browser isolation solutions (isolation of the
browser from the network to prevent it from becoming
an entry point for malicious actors) and browser security
to understand the resilience of central protection tech-
niques compared with distributed approaches;
• virtual authentication solutions based on machine learn-
ing and artificial intelligence for distributed devices with
low computational capabilities;
• services for identifying vulnerabilities in assets and
third-party services used by the organization that could
undermine the security of the organization itself (exter-
nal attack surface);
• solutions that exploit the greater potential of artificial in-
telligence and machine learning to enhance capabilities
in detecting IT threats and automating the process of
analysis, correlation and response to incidents;
• solutions for identifying vulnerabilities of assets and de-
vices (mobile devices, IoT, web applications, etc.) with the
help of innovative techniques;
• review of industrial environments through the imple-
mentation of a vulnerability identification process with
scripts without impacting the operating environments.
50 Report and financial statements of Enel SpA at December 31, 2022
Main risks and opportunities
In its capacity as an industrial holding company, Enel SpA
is exposed to the same risks associated with the Group’s
business.
In this regard, Enel adopted an internal control and risk man-
agement system (ICRMS), in line with the recommendations
of the Corporate Governance Code.
Enel has also adopted a risk governance model based on
a number of “pillars” as well as a uniform taxonomy of risks
(the “risk catalogue”) that facilitates their management and
organic representation.
The “pillars” of risk governance
Enel has adopted a reference framework for risk govern-
ance that is implemented in the real world through the
establishment of specific management, monitoring, con-
trol and reporting controls for each of the risk categories
identified.
The Group’s risk governance model is in line with the best
national and international risk management practices and
is based on the following pillars:
The Group “risk catalogue”
Enel has adopted a risk catalogue that represents a point
of reference at the Group level and for all corporate units
involved in risk management and monitoring processes.
The adoption of a common language facilitates the map-
ping and comprehensive representation of risks within the
Group, thus facilitating the identification of the main types
of risk that impact Group processes and the roles of the
organizational units involved in their management.
The risk catalogue groups the types of risk into macro-cat-
egories, which include, as shown below, strategic, financial
and operational risks, (non)-compliance risks, risks related
to governance and culture as well as digital technology.
Lines
of defense
Policy
Specific risk
committees
Group Risk
Committee
Reporting
Risk Appetite
Framework
1 2 3 4 5 6
Strategic
Governance
and Culture
Digital
technology Operational
Financial Compliance
RISKS
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
51Main risks and opportunities
Strategic risks
This category includes the following risks.
Legislative and regulatory
developments
The Group operates in regulated markets and changes in
the operating rules of the various systems, as well as the
prescriptions and obligations characterizing them, impact
the operations and performance of the Parent.
In order to manage the risks associated with these devel-
opments, Enel has intensified its relationships with local
governance and regulatory bodies, adopting a transpar-
ent, collaborative and proactive approach in addressing
and eliminating sources of instability in the legislative and
regulatory framework. In this context Enel has also estab-
lished specific corporate units that monitor the relevant
issues associated with the evolution of legislation and reg-
ulations at the local, national and international levels.
Macroeconomic and geopolitical
developments
While on the one hand the strong international presence
of the Group expands and diversifies our business op-
portunities, on the other hand it entails risks connected
with the exposure of cash flows and corporate assets to
changes in the global macroeconomic and financial en-
vironment. Idiosyncratic risk factors include the volatility
of exchange rates and changes in the economic, political,
social and financial conditions in the various countries.
Added to this are global risks connected with possible
new health crises and military conflicts, such as the recent
hostilities between Russia and Ukraine, which have already
had a negative impact on global short- to medium-term
growth prospects, and which may have impacts on the fu-
ture continuity of supplies, the prices of materials and/or
commodities, migration and economic activity in individu-
al countries. These factors are therefore evaluated on the
basis of the impacts that depend so closely on economic,
social and energy conditions in individual nations.
Climate change
In order to identify the main types of risk and opportuni-
ty and their impact on the business associated with them
in a structured manner consistent with the TCFD, we have
adopted a framework that explicitly represents the main
relationships between scenario variables and types of risk
and opportunity, specifying the strategic and operational
approaches to managing them, comprising mitigation and
adaptation measures.
There are two main macro-categories of risks/opportuni-
ties: those connected with developments in physical var-
iables and those linked to the evolution of the transition
scenarios.
Physical risks are divided in turn between acute (i.e., ex-
treme events) and chronic, with the former linked to ex-
tremely intense meteorological conditions and the latter to
more gradual but structural changes in climate conditions.
Extreme events expose the Group to the risk of prolonged
unavailability of assets and infrastructure, the cost of re-
storing service, customer disruptions and so on. Chronic
changes in climate conditions expose the Group to other
risks or opportunities: for example, structural changes in
temperature could cause changes in electricity demand
and have an impact on output, while alterations in rainfall
or wind conditions could impact the Group’s business by
increasing or decreasing potential electricity generation.
The assessment activities of physical risks allow the imple-
mentation of an adaptation strategy aimed at enhancing
our capacity to manage adverse events (Response Man-
agement), increasing asset resilience, including design re-
quirements (Resiliency Measures) and the identification of
new business opportunities and options.
With regard to the energy transition towards a more sus-
tainable model characterized by progressive electrification
and the reduction of CO
2
emissions, in line with the Group’s
decarbonization strategy, there are risks and opportunities
connected with both changes in the regulatory and legal
context and trends in technology development and elec-
trification and the consequent market developments, with
potential effects on the prices of commodities and energy
as well.
• Legislative and regulatory developments
• Macroeconomic and geopolitical trends
• Climate change
• Competitive environment
52 Report and financial statements of Enel SpA at December 31, 2022
Competitive environment
The markets and businesses in which the Group operates
are exposed to steadily growing competition and evo-
lution, from both a technological and regulatory point of
view, with the timing of these developments varying from
country to country.
As a result of these processes, Enel is exposed to growing
competitive pressure and, as electricity is this century’s
energy vector, competition driven by contiguous sectors is
also rising, although this offers utilities the opportunity to
move into new businesses.
The analysis of the competitive environment is one of the
key elements of the analysis of the context in which the
Group operates and defines its business ambitions. The
risks associated with evolutionary developments in the
market are also mitigated by the periodic monitoring of
the comparative performance at an industrial and financial
level of our competitors. The assessment activity is carried
out using a framework designed to (i) identify the most rel-
evant competitors and peers; (ii) analyze their results, the
main business drivers, strategic and industrial objectives;
and (iii) understand their current and prospective position-
ing.
Financial risks
As part of its operations, Enel is exposed to a variety of
financial risks – partly reflecting the central treasury func-
tion it performs for the Group – that, if not appropriately
mitigated, can directly impact our performance. These in-
clude currency risk, interest rate risk, credit and counter-
party risk and liquidity risk.
The financial risk governance arrangements adopted by
Enel establish specific internal committees that are re-
sponsible for policy setting and supervision of risk man-
agement, as well as the definition and application of spe-
cific policies that establish the roles and responsibilities
for risk management, monitoring and control processes,
ensuring compliance with the principle of organizational
separation of units responsible for operations and those in
charge of monitoring and managing risk.
The financial risk governance system also defines a system
of operating limits, for each risk, which are monitored pe-
riodically by risk management units. the system of limits
constitutes a decision-making tool to achieve its objec-
tives bearing in mind the risk/opportunity tradeoff.
For further information on the management of financial
risks, please see note 33 “Risk Management” of the finan-
cial statements.
Interest rate
Enel is exposed to the risk that changes in the level of in-
terest rates could produce unexpected changes in net fi-
nancial expense or financial assets and liabilities measured
at fair value.
The exposure to interest rate risk derives mainly from the
variability of the terms of financing, in the case of new
debt, and from the variability of the cash flows in respect
of interest on floating-rate debt.
The interest rate risk management policy seeks to contain
financial expense and its volatility by optimizing the portfo-
lio of financial liabilities and using OTC derivatives.
Risk control through specific processes, risk indicators and
operating limits enables us to limit possible adverse finan-
cial impacts and, at the same time, to optimize the struc-
ture of debt with an adequate degree of flexibility.
• Interest rate
• Commodity
• Currency
• Credit and counterparty
• Liquidity
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
53Main risks and opportunities
Currency
In view of its geographical diversification, access to inter-
national markets for the issuance of debt instruments and
transactions in commodities, Enel is exposed to the risk
that changes in exchange rates between the presentation
currency and other currencies could generate unexpected
changes in the performance and financial aggregates in
the financial statements.
The exposure to currency risk is mainly linked to the US
dollar and is attributable to cash flows in respect of invest-
ments, dividends from foreign associates or the purchase
or sale of equity investments and financial assets and lia-
bilities.
The currency risk management policy is based on system-
atically hedging the exposures of the Company.
Appropriate operational processes ensure the definition
and implementation of appropriate hedging strategies,
which typically employ financial derivatives obtained on
OTC markets.
Risk control through specific processes and indicators en-
ables us to limit possible adverse financial impacts and, at
the same time, to optimize the management of cash flows
on the managed portfolios.
Credit and counterparty
The Company is exposed to credit and counterparty risk,
i.e., the possibility of a deterioration in the creditworthiness
of our counterparties in financial transactions that could
have an adverse impact on the expected value of the cred-
itor position. The exposure to credit and counterparty risk
is essentially attributable to trading in derivatives, bank de-
posits and, more generally, financial instruments. Risk mit-
igation is pursued through the diversification of the port-
folio (preferring counterparties with a high credit standing)
and the adoption of specific standardized contractual
frameworks that contain risk mitigation clauses (e.g., net-
ting arrangements) and possibly the exchange of cash
collateral. Managing risk based on specific risk indicators,
and where possible limits, ensures that the economic and
financial impacts associated with a possible deterioration
in creditworthiness are contained within sustainable lev-
els. Thanks to the risk management and monitoring policy
adopted by Enel, there has been no significant changes in
the financial exposure and credit standing.
Liquidity
Liquidity risk is the risk that Enel, while solvent, would not
be able to discharge its obligations in a timely manner or
would only be able to do so on unfavorable terms owing to
situations of tension or systemic crises (credit crunches,
sovereign debt crises, etc.) or changes in the perception of
Enel riskiness by the market.
Among the factors that define the risk perceived by the
market, the credit rating assigned to Enel by rating agen-
cies plays a decisive role, since it influences its ability to
access sources of financing and the related financial terms
of that financing. A deterioration in the credit rating could
therefore restrict access to the capital market and/or in-
crease of the cost of funding, with consequent negative
effects on the financial position, financial performance and
cash flows of Enel.
In 2022, Enel’s risk profile only changed compared with De-
cember 2021 for Fitch, whose rating went from “A-” with a
stable outlook to “BBB+” with a stable outlook. Enel’s rat-
ing remained “BBB+” with a stable outlook for Standard &
Poor’s and “Baa1” with a stable outlook for Moody’s.
Enel’s liquidity risk management policy is designed to main-
tain sufficient liquidity to meet expected commitments
over a given time horizon without resorting to additional
sources of financing, also retaining a prudential liquidity
reserve, sufficient to meet any unexpected commitments.
Furthermore, in order to meet its medium and long-term
commitments, Enel pursues a borrowing strategy that pro-
vides for a diversified structure of funding sources, which
it uses to meet its financial needs, and a balanced maturity
profile.
The increase in gas prices in 2022 following the Rus-
sia-Ukraine conflict had an impact on the margins on com-
modity derivatives, which reached unprecedented levels.
At the end of the year, the liquidity risk index monitored for
the Group was well within the limits set for 2022, demon-
strating the Group’s resilience even under severe liquidi-
ty conditions caused by extraordinary and unforeseeable
events.
54 Report and financial statements of Enel SpA at December 31, 2022
Digital technology risks
The risks within this category are described in the follow-
ing sections.
Cyber security
The speed of technological developments that constantly
generate new challenges, the ever-increasing frequency
and intensity of cyber-attacks and the attraction of critical
infrastructures and strategic industrial sectors as targets
underscore the potential risk that, in extreme cases, the
normal operations of companies could grind to a halt.
In this context, cyber security risk represents the possibility
that cyber-attacks could compromise corporate informa-
tion systems (both management and industrial systems),
with the main consequence being the interruption of ser-
vices and the theft of sensitive information, with both fi-
nancial and reputational impacts.
Cyber-attacks have evolved dramatically in recent years:
their number has grown exponentially, as has their com-
plexity and impact, making it increasingly difficult to
promptly identify the source of threats. In the case of Enel,
this exposure reflects the many environments in which it
operates (data, industry and people), a circumstance that
accompanies the intrinsic complexity and interconnection
of the resources that over the years have been increasingly
integrated into daily operating processes.
The Enel Group has adopted a holistic governance ap-
proach to cyber security that is applied to all the sectors
of IT (Information Technology), OT (Operational Technolo-
gy) and IoT (Internet of Things). The framework is based on
the commitment of top management, on global strategic
management, on the involvement of all business areas as
well as on the units involved in the design and implemen-
tation of our systems. The Group leverages the best tech-
nologies available on the market while also acting on the
human factor through initiatives to increase awareness
and understanding of cyber security, which represents the
first line of corporate defense. In addition, the framework
incorporates regulatory requirements for information se-
curity, as well as the execution of extensive tests (in IT, OT
and IoT environments) to identify, mitigate and remove
identified vulnerabilities.
In addition, the Group has developed an IT risk manage-
ment methodology founded on “risk-based” and “cyber
security by design” approaches, thus integrating the anal-
ysis of business risks into all strategic decisions and inte-
grating security requirements over the entire life cycle of
solutions and services. Enel has also created its own Cyber
Emergency Readiness Team (CERT) in order to proactively
respond to any IT security incidents.
Digitalization, IT effectiveness
and service continuity
Enel is carrying out a complete digital transformation of
how it manages the entire energy value chain, developing
new business models and digitizing its business process-
es. A consequence of this digital transformation is that
Enel is increasingly exposed to risks related to the func-
tioning of the IT systems, implemented throughout the
Company, which could lead to service interruptions or data
losses and a consequent increase in operating costs, with
significant reputational and financial impacts.
These risks are managed using a series of internal meas-
ures developed by the Global Digital Solutions unit, which
is responsible for guiding Enel’s digital transformation. It
has set up an internal control system that introduces con-
trol points along the entire IT value chain, enabling us to
prevent the emergence of risks engendered by such is-
sues as the creation of services that do not meet business
needs, the failure to adopt adequate security measures
and service interruptions. The internal control system of
Global Digital Solutions oversees both the activities per-
formed in-house and those outsourced to external associ-
ates and service providers. Furthermore, Enel is promoting
the dissemination of a digital culture and digital skills, in
order to successfully guide the digital transformation and
minimize the associated risks.
• Cyber security
• Digitalization, IT effectiveness and service continuity
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
55Main risks and opportunities
Operational risks
Operational risks for Enel are described in the following
sections.
People and organization
Enel has placed sustainability at the center of its strategy
as the heart of its business model in order to contribute to
the achievement of the Sustainable Development Goals of
the United Nations 2030 Agenda. The Group has incorpo-
rated sustainability into different geographical, economic
and social contexts with the aim of guiding the Just Tran-
sition, essential for the future of the planet, accelerating
the decarbonization of its energy mix through the growth
of renewables and increasing electrification of consump-
tion. The profound social, economic and cultural transfor-
mations we are experiencing, from the energy transition
to the processes of digitalization and technological inno-
vation, also have a profound effect on the world of work,
renewing its paradigms and imposing major cultural and
organizational changes, which require new profession-
al qualifications and skills. In order to deal with change,
it is essential to act inclusively, placing the Person at the
center in his or her social and work dimension, with ad-
equate tools to cope with this epochal transformation.
Organizations must increasingly move towards new agile
and flexible work and business models that are sustainable
along the entire value chain. It is also essential to adopt
policies to enhance the diversity and talents of each per-
son, understanding that the contribution of the individual
represents an essential element for the creation of wide-
spread and shared value. The centrality of people and the
management of human capital are thus expressed through
the development of digital skills and competences; the
promotion of reskilling and upskilling for our people (con-
tinuous, personalized, flexible, accessible and transversal)
in order to ensure long life employability; the sharing of
industry best practices and training aimed also at those
who work with our people, both suppliers and contractors;
the appropriate widespread involvement of the corporate
purpose, which ensures the achievement of results while
guaranteeing greater satisfaction for people understood
as motivation and well-being.
Environment
Recent years have seen the continuation of the growth in
the sensitivity of the entire community to risks connect-
ed with development models that impact the quality of
the environment and ecosystems with the exploitation of
scarce natural resources (including raw materials and wa-
ter).
In some cases, the synergistic effects between these im-
pacts, such as global warming and the increasing exploita-
tion and degradation of water resources, have increased
the risk of environmental emergencies in the most sen-
sitive areas of the planet, with the risk of sparking com-
petition among different uses of water resources such as
industrial, agricultural and civil uses.
In response to these needs, authorities have imposed in-
creasingly restrictive environmental regulations, placing
ever more stringent constraints on the development of
new industrial initiatives and, in the most impactful indus-
tries, incentivizing or requiring the elimination of technol-
ogies no longer considered sustainable.
Our international commitment in the mitigation of impacts
on biodiversity is also growing. Already present in Europe in
the Green Deal, in 2022 this was sanctioned by the Global
Biodiversity Framework approved at COP 15 in Montreal.
In this context, companies in every sector, and above all
industry leaders, are ever more aware that environmental
risks are economic risks. As a result, they are called upon to
increase their commitment and accountability for devel-
oping and adopting innovative and sustainable technical
solutions and development models.
Enel has made the effective prevention and minimization
of environmental impacts and risks a foundational element
of each project across its entire life cycle.
The adoption of ISO 14001-certified environmental man-
agement systems across the entire Group ensures the
implementation of structured policies and procedures to
identify and manage the environmental risks and opportu-
nities associated with all corporate activities. A structured
• People and organization
• Environment
• Procurement, logistics and supply chain
56 Report and financial statements of Enel SpA at December 31, 2022
control plan combined with improvement actions and ob-
jectives inspired by the best environmental practices, with
requirements exceeding those for simple environmental
regulatory compliance, mitigate the risk of impacts on
the environment, reputational damage and litigation. Also
contributing are the multitude of actions to achieve the
challenging environmental improvement objectives set
by Enel, such as those regarding atmospheric emissions,
waste production and water consumption, especially in
areas with high water stress and impacts on habitats and
species.
The risk of water scarcity is directly mitigated by Enel’s de-
velopment strategy, which is based on the growth of gen-
eration from renewable sources that are essentially not
dependent on the availability of water for their operation.
Special attention is also devoted to assets in areas with a
high level of water stress, in order to develop technological
solutions to reduce consumption. Ongoing collaboration
with local river basin management authorities enables us
to adopt the most effective shared strategies for the sus-
tainable management of hydroelectric generation assets.
Finally, effective action is being taken for ecosystems to
protect, restore and conserve biodiversity in species and
natural habitats, respecting the mitigation hierarchy (avoid,
minimize, restore and offset) as well as appropriate terres-
trial, marine and river monitoring to verify the effective-
ness of the measures adopted.
Enel takes an active part in the international engagement
with influential stakeholders and networks (e.g., Business
for Nature, Taskforce on Nature-related Financial Disclo-
sures, World Business Council for Sustainable Develop-
ment and Science Based Targets for Nature) on issues
concerning nature and biodiversity.
Procurement, logistics and supply
chain
The purchasing processes of Global Procurement and
the associated governance documents form a structured
system of rules and control points that make it possible
to combine the achievement of economic business objec-
tives with full compliance with the fundamental principles
set out in the Code of Ethics, the Enel Global Compliance
Program, the Zero-Tolerance-of-Corruption Plan and the
Human Rights Policy, without renouncing the promotion of
initiatives for sustainable economic development.
These principles have been incorporated into the organ-
izational processes and controls that Enel has voluntarily
decided to adopt in order to establish relationships of trust
with all its stakeholders, as well as define stable and con-
structive relationships that are not based exclusively on
ensuring financial competitiveness but also take account
of best practices in essential areas for the Group, such as
the avoidance of child labor, occupational health and safe-
ty and environmental responsibility. Thanks to the great-
er interaction and integration with the outside world and
with the different parts of the corporate organization, the
procurement process has assumed an increasingly central
role in the creation of value. Global Procurement contrib-
utes to a resilient and sustainable supply chain, thinking
from a circular economy perspective and fostering inno-
vation, sharing the Group’s values and objectives with sup-
pliers who thereby become enablers of the achievement
of Enel’s targets.
More specifically, bonus factors have been introduced in
tenders in order to engender virtuous behavior on the part
of our suppliers. For example, the environmental impact of
any customer is strongly influenced by the impact of its
upstream supply chain, and that is why Global Procure-
ment pushes its suppliers to objectively measure their car-
bon footprint and improve their performance.
From the point of view of the procurement process, the
various Procurement Units almost systematically adopt the
tender mechanism, thus ensuring maximum competition
and equal access opportunities for all operators who are in
possession of the technical, economic/financial and envi-
ronmental requirements, security, human, legal and ethical
rights. Procurement with direct assignment and without a
competitive procedure can only take place in exceptional
cases, duly motivated, in compliance with current legisla-
tion on the matter.
Furthermore, the single global supplier qualification system
for the entire Enel Group, even before the procurement
process begins, verifies that potential suppliers who in-
tend to participate in procurement procedures are aligned
with the Company’s strategic vision and expectations in all
the areas and requirements cited earlier and that they have
adopted the same values.
With regard to the risk governance system, Global Pro-
curement is focused on the application of metrics that
indicate the level of risk before and after the mitigation
action, in order to implement precautionary measures to
reduce uncertainty to a tolerable level or mitigate any im-
pacts in all business, technological and geographical areas.
The effectiveness of supply chain risk management is
monitored through specific indicators – including the
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
57Main risks and opportunities
probability of insolvency, the concentration of contracts
with individual suppliers or industrial groups, the supplier’s
dependence on Enel, a performance indicator for the cor-
rectness of conduct during the tender, quality, punctuality
and sustainability in the execution of the contract, coun-
try risk, etc. – for which thresholds have been specified to
guide the definition of the procurement, negotiation and
tender award strategy, enabling informed choices of risk
and potential benefit (savings).
The actions taken to counter the impact of the COVID-19
emergency have focused in differentiating supply sourc-
es to avoid interruptions in the supply chain and the re-
mote performance of activities that would ordinarily re-
quire physical interaction between Enel and the supplier
(e.g., inspections at the company). Furthermore, to counter
the consequences of the geopolitical situation in Ukraine,
which has increased market volatility and further stressed
the supply chain, already strained during the COVID-19
pandemic, Global Procurement constantly monitors activ-
ities related to the supply/logistics chain, with the active
participation of our suppliers, through a specific contrac-
tual monitoring obligation, to mitigate the risks of market
shortages, logistical problems and business interruptions.
Compliance risks
Risks connected with the
protection of personal data
In the era of the digitalization and globalization of mar-
kets, Enel’s business strategy has focused on accelerating
the transformation towards a business model based on a
digital platform, using a data-driven and customer-centric
approach along the entire value chain.
This exposes Enel to the risks connected with the protec-
tion of personal data (an issue that must also take account
of the substantial growth in privacy legislation). Inadequate
implementation of such protection could cause financial
losses and reputational harm.
In order to manage and mitigate this risk, Enel has adopted
a model for the global governance of personal data, with
the appointment of personnel responsible for privacy is-
sues at all levels (including the appointment of Data Pro-
tection Officers at the global and country levels) and digital
compliance tools to map applications and processes and
manage risks with an impact on protecting personal data,
in compliance with specific local regulations in this field.
• Risks connected with the protection
of personal data
58 Report and financial statements of Enel SpA at December 31, 2022
Outlook
In November 2022, the Group presented its new Strategic
Plan for 2023-2025, setting out a strategy for responding
to the new global challenges, based on simplification and
focusing on the geographical areas that will make it pos-
sible to fully seize the opportunities associated with the
energy transition.
In particular, the Strategic Plan seeks to:
• focus on an integrated industrial supply chain towards
sustainable electrification;
• achieve strategic repositioning of businesses and geo-
graphical areas of operation;
• ensure growth and financial soundness by combining
the growth of ordinary profit with stronger credit met-
rics as early as 2023.
In pursuing these objectives, between 2023 and 2025 the
Group expects to invest a total of around €37 billion, of
which 60% in support of the Group’s integrated commer-
cial strategy (generation, customers and services) and 40%
on grids, to support their role as enablers of the energy
transition.
The Plan will focus on four strategic actions.
• Balancing client demand and supply to optimize risk/
reward profile.
By 2025, the Group expects to sell around 80% of its
electricity volumes in the six core countries with fixed-
price contracts. The Group also expects to satisfy 100%
of fixed-price sales with its own generation and long-
term power purchase agreements (PPAs), envisaging
that around 90% be covered by carbon-free sources, to
further ensure the evolution of the Group’s margins.
• Decarbonization to ensure competitiveness, sustaina-
bility and security.
By 2025, the Group expects to add approximately 21 GW
of installed renewable capacity (of which some 19 GW
in core countries), positioning itself well towards achiev-
ing its decarbonization objectives, in line with the Paris
Agreement.
• Strengthening, developing and digitalizing grids to en-
able the transition.
The Group’s strategy for grids concerns five of the six
core countries, namely Italy, Spain, Brazil, Chile and Co-
lombia.
• Rationalization of business portfolio and geographical
areas.
The Group plans a further rationalization of its structure,
exiting some businesses and geographical areas that are
no longer aligned with its strategy, in order to redefine
the Group structure, maximizing shareholder value.
As a result of the strategic actions described above, the
Group’s ordinary EBITDA is expected to reach €22.2-22.8
billion in 2025, compared with €19.7 billion in 2022.
Group ordinary profit is expected to grow to €7.0-7.2 billion
in 2025, compared with €5.4 billion in 2022.
Enel’s dividend policy remains simple and predictable, with
a DPS of €0.43 in the 2023-2025 period, up from €0.40 in
2022. Furthermore, the DPS in 2024 and 2025 should be
considered as a sustainable minimum.
The following are planned for 2023:
• a continuation of the investment policy in renewable en-
ergy to support industrial growth and as part of the de-
carbonization policies followed by the Group;
• further investments in distribution grids, especially in Ita-
ly, with the aim of improving service quality and increas-
ing the flexibility and resilience of the grid;
• a continuation of the investment policy dedicated to the
electrification of consumption, with the aim of enhanc-
ing the growth of the customer base, as well as contin-
uous efficiency improvement through global business
platforms.
In view of the foregoing, the financial targets on which the
Group’s 2023-2025 Plan is based are reported below.
Financial targets
2022 2023 2024 2025
Profit growth
Ordinary EBITDA (€ billions) 19.7 20.4-21.0 21.4-22.0 22.2-22.8
Ordinary profit (€ billions) 5.4 6.1-6.3 6.7-6.9 7.0 -7. 2
Value creation
Dividend per share (€) 0.40 0.43 0.43
(1)
0.43
(1)
(1) Minimum DPS.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
59Outlook
Other information
Non-EU subsidiaries
At the date of approval by the Board of Directors of the
financial statements of Enel SpA for 2022 – March 16, 2023
– the Enel Group meets the “conditions for the listing of
shares of companies with control over companies estab-
lished and regulated under the law of non-EU countries”
(hereinafter “non-EU subsidiaries”) established by CON-
SOB with Article 15 of the Markets Regulation (approved
with Resolution no. 20249 of December 28, 2017).
Specifically, we report that:
• in application of the materiality criteria for the purposes
of consolidation referred to in Article 15, paragraph 2, of
the CONSOB Markets Regulation, 52 non-EU subsidiar-
ies of the Enel Group have been identified to which the
rules in question apply on the basis of the consolidated
accounts of the Enel Group at December 31, 2021;
• they are: 1) Ampla Energia e Serviços SA (a Brazilian com-
pany belonging to Enel Américas SA); 2) Aurora Wind
Project LLC (a United States company belonging to Enel
North America Inc.); 3) Azure Sky Wind Project LLC (a
United States company belonging to Enel North America
Inc.); 4) Celg Distribuição SA - Celg-D (a Brazilian com-
pany that exited the scope of the Enel Group as from
December 29, 2022); 5) Cimarron Bend Wind Holdings
I LLC (a United States company belonging to Enel North
America Inc.); 6) Codensa SA ESP (a Colombian com-
pany merged into Emgesa SA ESP on March 1, 2022);
7) Companhia Energética do Ceará - Coelce (a Brazilian
company belonging to Enel Américas SA); 8) Dolores
Wind SA de Cv (a Mexican company belonging to Enel
Green Power SpA); 9) EGPNA Preferred Wind Holdings
LLC (a United States company belonging to Enel North
America Inc.); 10) Eletropaulo Metropolitana Eletricidade
de São Paulo SA (a Brazilian company belonging to Enel
Américas SA); 11) Emgesa SA ESP (a Colombian company
belonging to Enel Américas SA, renamed Enel Colombia
SA ESP on March 1, 2022); 12) Empresa Distribuidora Sur
SA - Edesur (an Argentine company belonging to Enel
Américas SA); 13) Enel Américas SA (a Chilean compa-
ny directly controlled by Enel SpA); 14) Enel Argentina
SA (an Argentine company belonging to Enel Américas
SA); 15) Enel Brasil SA (a Brazilian company belonging to
Enel Américas SA); 16) Enel Chile SA (a Chilean compa-
ny directly controlled by Enel SpA); 17) Enel Distribución
Chile SA (a Chilean company belonging to Enel Chile SA);
18) Enel Distribución Perú SAA (a Peruvian company be-
longing to Enel Américas SA); 19) Enel Finance America
LLC (a United States company belonging to Enel North
America Inc.); 20) Enel Fortuna SA (a Panamanian com-
pany belonging to Enel Américas SA); 21) Enel Gener-
ación Chile SA (a Chilean company belonging to Enel
Chile SA); 22) Enel Generación Costanera SA (an Argen-
tine company belonging to Enel Américas SA); 23) Enel
Generación Perú SAA (a Peruvian company belonging
to Enel Américas SA); 24) Enel Green Power Cachoei-
ra Dourada SA (a Brazilian company belonging to Enel
Américas SA); 25) Enel Green Power Chile SA (a Chilean
company belonging to Enel Chile); 26) Enel Green Pow-
er Colombia SAS ESP (a Colombian company merged
on March 1, 2022 into Emgesa SA ESP); 27) Enel Green
Power Power Diamond Vista Wind Project LLC (a United
States company belonging to Enel North America Inc.);
28) Enel Green Power México S de RL de Cv (a Mexican
company belonging to Enel Green Power SpA); 29) Enel
Green Power North America Development LLC (a United
States company belonging to Enel North America Inc.);
30) Enel Green Power North America Inc. (a United States
company belonging to Enel North America Inc.); 31) Enel
Green Power Panamá Srl (a Panamanian company be-
longing to Enel Américas SA, renamed Enel Panamá CAM
Srl on August 16, 2022); 32) Enel Green Power Perú SAC
(a Peruvian company belonging to Enel Américas SA); 33)
Enel Green Power Rattlesnake Creek Wind Project LLC (a
United States company belonging to Enel North America
Inc.); 34) Enel Green Power RSA (Pty) Ltd (a South Afri-
can company belonging to Enel Green Power SpA); 35)
Enel Green Power RSA 2 (RF) (Pty) Ltd (a South African
company belonging to Enel Green Power SpA); 36) Enel
Kansas LLC (a United States company belonging to Enel
North America Inc.); 37) Enel North America Inc. (a Unit-
ed States company directly controlled by Enel SpA); 38)
Enel Perú SAC (a Peruvian company belonging to Enel
Américas SA); 39) Enel Rinnovabile SA de Cv (a Mexican
company belonging to Enel Green Power SpA); 40) Enel
Russia PJSC (a Russian company that exited the scope
of the Enel Group on October 12, 2022); 41) Enel Trading
North America LLC (a United States company belonging
to Enel North America Inc.); 42) Enel Transmisión Chile
SA (a Chilean company that exited the scope of the Enel
Group on December 9, 2022); 43) Enel X North America
Inc. (a United States company belonging to Enel North
60 Report and financial statements of Enel SpA at December 31, 2022
America Inc.); 44) Essa2 SpA (a Chilean company merged
on March 1, 2022 into Emgesa SA ESP); 45) Geotérmica
del Norte SA (a Chilean company belonging to Enel Chile
SA); 46) High Lonesome Wind Power LLC (a United States
company belonging to Enel North America Inc.); 47) Red
Dirt Wind Project LLC (a United States company belong-
ing to Enel North America Inc.); 48) Rock Creek Wind
Project LLC (a United States company belonging to Enel
North America Inc.); 49) Rockhaven Ranchland Holdings
LLC (a United States company belonging to Enel North
America Inc.); 50) Thunder Ranch Wind Project LLC (a
United States company belonging to Enel North America
Inc.); 51) Tradewind Energy Inc. (a United States company
belonging to Enel North America Inc.); 52) White Cloud
Wind Project LLC (a United States company belonging
to Enel North America Inc.);
• the balance sheet and income statement of the above
companies included in the reporting package used for
the purpose of preparing the 2022 consolidated finan-
cial statements of the Enel Group will be made available
to the public by Enel SpA (pursuant to Article 15, para-
graph 1a) of the Markets Regulation) at least 15 days pri-
or to the day scheduled for the Ordinary Shareholders’
Meeting called to approve the 2022 financial statements
of Enel SpA together with the summary statements
showing the essential data of the latest annual financial
statements of subsidiaries and associated companies
(pursuant to the applicable provisions of Article 77, par-
agraph 2-bis, of the CONSOB Issuers Regulation ap-
proved with Resolution no. 11971 of May 14, 1999);
• the articles of association and composition and pow-
ers of the control bodies from all the above subsidiaries
have been obtained by Enel SpA and are available in up-
dated form to CONSOB where the latter should request
such information for supervisory purposes (pursuant to
Article 15, paragraph 1b) of the Markets Regulation);
• Enel SpA has verified that the above subsidiaries:
– provide the auditor of the Parent, Enel SpA, with in-
formation necessary to perform annual and interim
audits of Enel SpA (pursuant to Article 15, paragraph 1
(letter c-i) of the Markets Regulation);
– use an administrative and accounting system ap-
propriate for regular reporting to the management
and auditor of the Parent, Enel SpA, of income state-
ment, balance sheet and financial data necessary for
preparation of the consolidated financial statements
(pursuant to Article 15, paragraph 1 (letter c-ii) of the
Markets Regulation).
Approval of the separate financial statements
The Shareholders’ Meeting called to approve the sepa-
rate financial statements, as provided for by Article 9.2 of
the bylaws of Enel SpA, shall be called within 180 days of
the close of the financial year. The use of that time limit
rather than the ordinary limit of 120 days from the close
of the financial year, permitted under Article 2364, para-
graph 2, of the Italian Civil Code, is justified by the fact that
the Company is required to prepare consolidated financial
statements.
Disclosures on financial instruments
The disclosures on financial instruments required by Article
2428, paragraph 2, no. 6-bis of the Civil Code are report-
ed in the following notes to the financial statements: 32
“Financial instruments”, 33 “Risk management”, 34 “Deriv-
atives and hedge accounting” and 35 “Fair value measure-
ment”.
Transactions with related parties
For more information on transactions with related parties,
please see note 37.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
61Other information
Own shares
At December 31, 2022, treasury shares are represented by
7,153,795 ordinary shares of Enel SpA with a par value of
€1.00 each (4,889,152 at December 31, 2021), purchased
through an authorized intermediary for a total of about
€47 million.
Atypical or unusual operations
Pursuant to the CONSOB Notice of July 28, 2006, the
Group did not carry out any atypical or unusual operations
in 2022. Such operations include transactions whose sig-
nificance, size, nature of the counterparties, subject mat-
ter, method for calculating the transfer price or timing
could give rise to doubts concerning the propriety and/or
completeness of disclosure, conflicts of interest, preser-
vation of company assets or protection of non-controlling
shareholders.
Subsequent events
Significant events following the close of the year are dis-
cussed in note 42.
62 Report and financial statements of Enel SpA at December 31, 2022
Incentive system
Enel’s remuneration policy for 2022, which was adopted by
the Board of Directors acting on a proposal of the Nomina-
tion and Compensation Committee and approved by the
Shareholders’ Meeting of May 19, 2022, was formulated
on the basis of (i) the recommendations of the Italian Cor-
porate Governance Code published on January 31, 2020;
(ii) national and international best practice; (iii) the guid-
ance provided by the favorable vote of the Shareholders’
Meeting of May 20, 2021 on the remuneration policy for
2021; (iv) the results of the engagement activity on corpo-
rate governance issues pursued by the Company between
January and March 2022 with the leading proxy advisors
and some Enel’s relevant institutional investors; (v) the find-
ings of the benchmark analysis of the remuneration of the
Chairman of the Board of Directors, the Chief Executive
Officer/General Manager and the non-executive directors
of Enel for 2021, which was performed by the independent
consultant Mercer.
This policy is intended to (i) foster Enel’s sustainable suc-
cess, which takes the form of creating long-term value
for the benefit of shareholders, taking due consideration
of the interests of other key stakeholders, so as to incen-
tivize the achievement of strategic objectives; (ii) attract,
retain and motivate personnel with the professional skills
and experience required by the sensitive managerial duties
entrusted to them, taking into account the remuneration
and working conditions of the employees of the Company
and the Enel Group; and (iii) promote the corporate mis-
sion and values.
The 2022 remuneration policy adopted for the Chief Exec-
utive Officer/General Manager and key management per-
sonnel envisages:
• a fixed component;
• a short-term variable component (MBO) that will be paid
out on the basis of achievement of specific performance
objectives. Namely:
– for the CEO/General Manager, annual objectives have
been set for the following components:
• consolidated net ordinary profit;
• Group opex;
• funds from operations/consolidated net financial
debt;
• System Average Interruption Duration Index - SAI-
DI (gate objective), commercial complaints on the
free commodity market in Italy (gate objective) and
commercial complains received at the Group level;
• workplace safety;
– for key management personnel, the respective MBOs
identify objective and specific annual goals connect-
ed with the Strategic Plan. They are determined jointly
by the Administration, Finance and Control function
and the People and Organization function;
• a long-term variable component linked to participa-
tion in specific long-term incentive plans. In particular,
for 2022 this component is linked to participation in the
Long-Term Incentive Plan 2022 for the management of
Enel SpA and/or its subsidiaries pursuant to Article 2359
of the Italian Civil Code (2022 LTI Plan), which establishes
three-year performance targets for the following:
– Enel’s average TSR (Total Shareholder Return) com-
pared with the average TSR for the EURO STOXX Utili-
ties - EMU index for the 2022-2024 period;
– ROIC (Return on Invested Capital) - WACC (Weighted
Average Cost of Capital), cumulative for 2022-2024;
– Scope 1 GHG emissions per equivalent kWh generat-
ed by the Group in 2024;
– percentage of women in top management succes-
sion plans at the end of 2024.
The 2022 LTI Plan establishes that any bonus accrued is
represented by an equity component, which can be sup-
plemented – depending on the level of achievement of the
various targets – by a cash component. More specifical-
ly, the Plan envisages that 130% of the basic bonus of the
Chief Executive Officer/General Manager (compared with a
maximum of 280% of the basic bonus) and 65% of the ba-
sic bonus of key management personnel (compared with a
maximum of 180% of the basic bonus) will be paid in Enel
shares previously acquired by the Company. In addition,
the disbursement of a significant portion of long-term
variable remuneration (70% of the total) is deferred to the
second year following the three-year performance period
covered by the 2022 LTI Plan.
For more information on the remuneration policy for 2022,
please see Enel’s “Report on the remuneration policy for
2022 and compensation paid in 2021”, which is available on
the Company’s website (www.enel.com).
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
63Incentive system
2.
64 Report and financial statements of Enel SpA at December 31, 2022
Corporate
governance
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
65
Report on corporate governance
and ownership structure
(3) Available from the website of Borsa Italiana (at https://www.borsaitaliana.it/comitato-corporate-governance/codice/2020-eng.en.pdf).
The corporate governance system of Enel SpA is compliant
with the principles set forth in the January 2020 edition of
the Italian Corporate Governance Code,
(3)
adopted by the
Company, and with international best practice.
The corporate governance system adopted by Enel and
the Group is essentially aimed at achieving sustainable
success, as it is aimed at creating value for the sharehol-
ders over the long term, taking into account the environ-
mental and social importance of the Enel Group’s business
operations and the consequent need, in conducting such
operations, to adequately consider the interests of all re-
levant stakeholders.
In compliance with Italian legislation governing listed com-
panies, Enel’s organization comprises the following bodies:
• a Board of Directors charged with managing the Com-
pany, which has established (i) internal Board committe-
es whose functions include the preliminary analysis of
issues, the development of recommendations and the
performance of advisory functions, in order to ensure
the adequate internal allocation its functions, as well
as (ii) a committee for transactions with related parties,
which performs the functions envisaged by applicable
legislation and specific company procedure;
• a Board of Statutory Auditors charged with monitoring:
(i) compliance with the law and the bylaws, and with the
principles of sound administration in the performance of
company business; (ii) the financial reporting process, as
well as the adequacy of the organizational structure, the
internal control system and the administrative-accoun-
ting system of the Company; (iii) the statutory auditing
of the annual accounts and the consolidated accounts,
as well as the independence of the Audit Firm; and (iv)
the manner in which the corporate governance rules set
out in the Corporate Governance Code are actually im-
plemented;
• a Shareholders’ Meeting, which is competent to take de-
cisions concerning, among other issues – in ordinary or
extraordinary session: (i) the appointment and termina-
tion of members of the Board of Directors and the Bo-
ard of Statutory Auditors and their compensation and
any stockholders’ suits; (ii) the approval of the separa-
te financial statements and allocation of profit; (iii) the
purchase and sale of treasury shares; (iv) remuneration
policy and its implementation; (v) stock-based compen-
sation plans; (vi) amendments of the bylaws; (vii) mergers
and demergers; and (viii) the issue of convertible bonds.
The statutory auditing of the accounts is performed by a
specialized firm entered in the appropriate official register.
It was engaged by the Shareholders’ Meeting on the basis
of a reasoned proposal of the Board of Statutory Auditors.
66 Report and financial statements of Enel SpA at December 31, 2022
Chairman
Michele Crisostomo
Chief Executive Officer
and General Manager
Francesco Starace
Cesare Calari
Costanza Esclapon de Villeneuve
Samuel Leupold
Alberto Marchi
Mariana Mazzucato
Mirella Pellegrini
Anna Chiara Svelto
Chairman
Barbara Tadolini
Luigi Borré
Maura Campra
Shareholders’
Meeting
Board of
Directors
Corporate
Governance and
Sustainability
Committee
Nomination and
Compensation
Committee
Control and Risk
Committee
Related Parties
Committee
Audit Firm
KPMG SpA
Board of
Statutory Auditors
For more detailed information on the corporate governan-
ce system, please see the Report on Corporate Governan-
ce and Ownership Structure of Enel, which has been pu-
blished on the Company’s website (http://www.enel.com, in
the “Governance” section).
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
67Report on corporate governance and ownership structure
3.
68 Report and financial statements of Enel SpA at December 31, 2022
Profit of the year of €7,157 million
The result reflects the increase in other income
and income from equity investments,
as well as the results of financial operations.
The increase on 2021 is €2,395 million.
Growing dividend
The dividend for 2022 is €0.40 per share,
an increase of 5.3% compared
to the dividend distributed in 2021.
Climate change effects
The Group’s assessment process takes
into account the impact of climate change
in the long term.
Separate financial
statements
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
69
Separate financial statements
Income Statement
Euro Notes
2022 2021
of which with
related parties
of which with
related parties
Revenue
Revenue from sales and services
4.a 116,051,123 116,143,487 125,426,702 125,382,065
Other income
4.b 16,663,153 14,877, 215 1,643,537,558 14,038,934
[Subtotal] 132,714,276 1,768,964,260
Costs
Purchase of consumables
5.a 386,707 218,873 523,948 366,196
Services, leases and rentals
5.b 206,383,096 132,838,081 196,758,516 129,741,926
Personnel expenses
5.c 104,681,593 178,564,663
Depreciation, amortization and impairment
losses
5.d 1,329,696,603 734,099,075
Other operating costs
5.e 26,904,912 615,302 13,637,338 680,506
[Subtotal] 1,668,052,911 1,123,583,540
Operating loss (1,535,338,635) 645,380,720
Income from equity investments
6 8,770,435,089 8,770,003,874 4,450,596,876 4,449,822,148
Financial income from derivatives
7 2,131,015,975 627,229,150 1,072,689,763 253,243,181
Other financial income
8 431,697,733 379,617,287 239,976,218 237,221,205
Financial expense from derivatives
7 1,959,981,967 1,166,367,143 891,233,492 505,710,198
Other financial expense
8 786,552,405 309,241,496 869,140,792 203,472,671
[Subtotal] 8,586,614,425 4,002,888,573
Pre-tax profit 7,051,275,790 4,648,269,293
Income taxes
9 (106,090,159) (114,212,964)
PROFIT FOR THE YEAR 7,157,365,949 4,762,482,257
70 Report and financial statements of Enel SpA at December 31, 2022
Statement of Comprehensive Income
Euro Notes
2022 2021
Profit for the year 7,157,365,949 4,762,482,257
Other comprehensive income/(expense) that may be subsequently reclassified
to profit or loss (net of taxes)
Effective portion of change in the fair value of cash flow hedges 294,350,690 124,454,364
Change in the fair value of hedging costs (3,149,358) 15,717,853
Other comprehensive income/(expense) that may not be subsequently reclassified
to profit or loss
Remeasurement of net liabilities/(assets) for defined benefit plans 13,268,911 4,564,511
Change in the fair value of equity investments in other companies 1,952,292 -
Total other comprehensive income/(loss)
23 306,422,535 144,736,728
Comprehensive income/(loss) for the year 7,463,788,484 4,907,218,985
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
71Separate financial statements
Statement of Financial Position
Euro Notes
ASSETS at Dec. 31, 2022 at Dec. 31, 2021
of which with
related parties
of which with
related parties
Non-current assets
Property, plant and equipment
10 10,527,976 11,735,807
Intangible assets
11 133,425,176 143,456,537
Deferred tax assets
12 146,252,786 298,539,457
Equity investments
13 59,952,466,507 60,268,990,442
Non-current financial derivative assets
14 348,779,629 35,499,991 753,312,462 153,244,028
Other non-current financial assets
15 13,667,732 15,417,338
Other non-current assets
16 81,210,258 68,953,577 99,043,140 86,843,927
[Total] 60,686,330,064 61,590,495,183
Current assets
Trade receivables
17 294,100,316 294,690,317 275,247,959 276,190,306
Income tax assets
18 164,519,486 141,877,919
Current financial derivative assets
14 390,303,368 85,798,846 59,972,681 23,256,617
Other current financial assets
19 3,480,039,167 3,019,086,075 8,257,266,476 7,133,865,088
Other current assets
20 584,062,049 282,681,908 1,063,147,760 1,044,515,604
Cash and cash equivalents
21 4,867,872,963 952,254,599
[Total] 9,780,897,349 10,749,767,394
Non-current assets classified as held for sale
22 654,000,000 -
TOTAL ASSETS 71,121,227,413 72,340,262,577
72 Report and financial statements of Enel SpA at December 31, 2022
Euro Notes
LIABILITIES AND EQUITY at Dec. 31, 2022 at Dec. 31, 2021
of which with
related parties
of which with
related parties
Equity
Share capital 10,166,679,946 10,166,679,946
Treasury share reserve (47,077,924) (36,046,337)
Equity instruments - perpetual hybrid bonds 5,567,477,464 5,567,477,464
Other reserves 11,835,447,410 11,510,379,340
Retained earnings/(Loss carried forward) 5,695,687,373 4,928,260,660
Profit for the year
(1)
5,124,029,959 2,830,813,067
TOTAL EQUITY
23 38,342,244,228 34,967,564,140
Non-current liabilities
Long-term borrowings
24 18,195,966,550 12,406,766,403 25,572,039,327 18,738,942,712
Employee benefits
25 131,204,919 171,939,929
Non-current portion of provisions for risks
and charges
26 26,699,393 49,212,156
Deferred tax liabilities
12 98,253,224 149,317,756
Non-current financial derivative liabilities
14 663,170,856 163,067,356 1,300,244,640 25,575,645
Other non-current liabilities
27 23,089,469 8,493,024 29,470,863 8,473,280
[Total] 19,138,384,411 27,272,224,671
Current liabilities
Short-term borrowings
24 8,751,561,341 8,362,050,365 6,563,294,343 5,624,719,235
Current portion of long-term borrowings
24 1,430,638,032 1,332,500,814 215,621,277 117,654,573
Current portion of provisions for risks and
charges
26 14,646,861 12,122,617
Trade payables
28 154,478,681 97,033,054 167,020,616 116,525,041
Current financial derivative liabilities
14 178,393,271 69,056,412 130,821,277 36,532,890
Other current financial liabilities
29 238,249,602 94,222,302 226,570,923 70,929,839
Other current liabilities
31 2,872,630,986 739,812,883 2,785,022,713 220,243,966
[Total] 13,640,598,774 10,100,473,766
TOTAL LIABILITIES 32,778,983,185 37,372,698,437
TOTAL LIABILITIES AND EQUITY 71,121,227,413 72,340,262,577
(1) Profit for the year of €7,157 million (€4,762 million in 2021) is reported net of the interim dividend of €2,033 million (€1,932 million in 2021).
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
73Separate financial statements
Statement of Changes in Equity (note 23)
Euro Share capital
Share premium
reserve
Negative
treasury share
reserve
Equity
instruments
reserve -
perpetual hybrid
bonds Legal reserve
Reserve
pursuant to Law
292/1993 Other reserves Hedging reserve
Hedging costs
reserve
Reserve from
measurement of
financial assets
at FVOCI Actuarial reserve
Retained
earnings
Profit for the
year Total equity
At January 1, 2021 10,166,679,946 7,475,994,347 (3,269,152) 2,385,529,628 2,033,335,988 2,215,444,500 73,472,904 (442,654,761) (15,977,786) (119,746) (39,242,244) 6,346,833,602 546,791,537 30,742,818,763
Other changes - 20,021,716 (20,021,716) - - - - - - - - - - -
Purchase of treasury shares - (42,879) (12,755,469) - - - 36,046,337 - - - - (36,046,337) - (12,798,348)
Reserve for share-based
payments (LTI)
- - - - - - 9,364,236 - - - - - - 9,364,236
Equity instruments - perpetual
hybrid bonds
- - - 3,181,947,836 - - - - - - - - - 3,181,947,836
Coupons paid to holders of
perpetual hybrid bonds
- - - - - - - - - - - (70,554,749) - (70,554,749)
Allocation of 2020 profit
Distribution of dividends - - - - - -
- - - - - (1,321,668,393) (538,834,037) (1,860,502,430)
Retaining earnings - - - - - - - - - - - 8,767,5 9 8 (7,957,500) 810,098
2021 interim dividend
(1)
- - - - - - - - - - - 928,939 (1,931,669,190) (1,930,740,251)
Comprehensive income for the
year
Other comprehensive income - - - - - -
- 124,454,364 15,717,853 - 4,564,511 - - 144,736,728
Profit for the year - - - - - - - - - - - - 4,762,482,257 4,762,482,257
At December 31, 2021 10,166,679,946 7,495,973,184 (36,046,337) 5,5 67,47 7,46 4 2,033,335,988 2,215,444,500 118,883,477 (318,200,397) (259,933) (119,746) (34,677,733) 4,928,260,660 2,830,813,067 34,967,564,140
Other changes - - - - - - 1,034 - - - - - - 1,034
Purchase of treasury shares - - (14,071,647) - - - 14,026,715 - - - - (14,026,715) - (14,071,647)
Reserve for share-based
payments (LTI)
- 42,879 - - - - 7,525,713 - - - - - - 7,568,592
Issue of own shares - - 3,040,060 - - - (2,950,806) - - - - 2,950,806 - 3,040,060
Equity instruments - perpetual
hybrid bonds
- - - - - - - - - - - - - -
Coupons paid to holders of
perpetual hybrid bonds
- - - - - - - - - - - (123,434,990) - (123,434,990)
Allocation of 2021 profit
Distribution of dividends - - - - - -
- - - - - - (1,931,669,190) (1,931,669,190)
Coupons paid to holders of
perpetual hybrid bonds
- - - - - - - - - - - 70,554,749 (70,554,749) -
Retaining earnings - - - - - - - - - - - 829,952,104 (828,589,129) 1,362,975
2022 interim dividend
(2)
- - - - - - - - - - - 1,430,759 (2,033,335,989) (2,031,905,230)
Comprehensive income for the
year
Other comprehensive income - - - - - -
- 294,350,690 (3,149,358) 1,952,292 13,268,911 - - 306,422,535
Profit for the year - - - - - - - - - - - - 7,157,365,949 7,157,365,949
At December 31, 2022 10,166,679,946 7,496,016,063 (47,077,924) 5 ,5 67,47 7, 46 4 2,033,335,988 2,215,444,500 137,486,133 (23,849,707) (3,409,291) 1,832,546 (21,408,822) 5,695,687,373 5,124,029,959 38,342,244,228
(1) Approved by the Board of Directors on November 4, 2021 and paid as from January 26, 2022.
(2) Approved by the Board of Directors on November 3, 2022 and paid as from January 25, 2023.
74 Report and financial statements of Enel SpA at December 31, 2022
Statement of Changes in Equity (note 23)
Euro Share capital
Share premium
reserve
Negative
treasury share
reserve
Equity
instruments
reserve -
perpetual hybrid
bonds Legal reserve
Reserve
pursuant to Law
292/1993 Other reserves Hedging reserve
Hedging costs
reserve
Reserve from
measurement of
financial assets
at FVOCI Actuarial reserve
Retained
earnings
Profit for the
year Total equity
At January 1, 2021 10,166,679,946 7,475,994,347 (3,269,152) 2,385,529,628 2,033,335,988 2,215,444,500 73,472,904 (442,654,761) (15,977,786) (119,746) (39,242,244) 6,346,833,602 546,791,537 30,742,818,763
Other changes - 20,021,716 (20,021,716) - - - - - - - - - - -
Purchase of treasury shares - (42,879) (12,755,469) - - - 36,046,337 - - - - (36,046,337) - (12,798,348)
Reserve for share-based
payments (LTI)
- - - - - - 9,364,236 - - - - - - 9,364,236
Equity instruments - perpetual
hybrid bonds
- - - 3,181,947,836 - - - - - - - - - 3,181,947,836
Coupons paid to holders of
perpetual hybrid bonds
- - - - - - - - - - - (70,554,749) - (70,554,749)
Allocation of 2020 profit
Distribution of dividends - - - - - -
- - - - - (1,321,668,393) (538,834,037) (1,860,502,430)
Retaining earnings - - - - - - - - - - - 8,767,5 9 8 (7,957,500) 810,098
2021 interim dividend
(1)
- - - - - - - - - - - 928,939 (1,931,669,190) (1,930,740,251)
Comprehensive income for the
year
Other comprehensive income - - - - - -
- 124,454,364 15,717,853 - 4,564,511 - - 144,736,728
Profit for the year - - - - - - - - - - - - 4,762,482,257 4,762,482,257
At December 31, 2021 10,166,679,946 7,495,973,184 (36,046,337) 5,5 67,47 7,46 4 2,033,335,988 2,215,444,500 118,883,477 (318,200,397) (259,933) (119,746) (34,677,733) 4,928,260,660 2,830,813,067 34,967,564,140
Other changes - - - - - - 1,034 - - - - - - 1,034
Purchase of treasury shares - - (14,071,647) - - - 14,026,715 - - - - (14,026,715) - (14,071,647)
Reserve for share-based
payments (LTI)
- 42,879 - - - - 7,525,713 - - - - - - 7,568,592
Issue of own shares - - 3,040,060 - - - (2,950,806) - - - - 2,950,806 - 3,040,060
Equity instruments - perpetual
hybrid bonds
- - - - - - - - - - - - - -
Coupons paid to holders of
perpetual hybrid bonds
- - - - - - - - - - - (123,434,990) - (123,434,990)
Allocation of 2021 profit
Distribution of dividends - - - - - -
- - - - - - (1,931,669,190) (1,931,669,190)
Coupons paid to holders of
perpetual hybrid bonds
- - - - - - - - - - - 70,554,749 (70,554,749) -
Retaining earnings - - - - - - - - - - - 829,952,104 (828,589,129) 1,362,975
2022 interim dividend
(2)
- - - - - - - - - - - 1,430,759 (2,033,335,989) (2,031,905,230)
Comprehensive income for the
year
Other comprehensive income - - - - - -
- 294,350,690 (3,149,358) 1,952,292 13,268,911 - - 306,422,535
Profit for the year - - - - - - - - - - - - 7,157,365,949 7,157,365,949
At December 31, 2022 10,166,679,946 7,496,016,063 (47,077,924) 5 ,5 67,47 7, 46 4 2,033,335,988 2,215,444,500 137,486,133 (23,849,707) (3,409,291) 1,832,546 (21,408,822) 5,695,687,373 5,124,029,959 38,342,244,228
(1) Approved by the Board of Directors on November 4, 2021 and paid as from January 26, 2022.
(2) Approved by the Board of Directors on November 3, 2022 and paid as from January 25, 2023.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
75Separate financial statements
Statement of Cash Flows
Euro Notes
2022 2021
of which with
related parties
of which with
related parties
Pre-tax profit 7,051,275,790 4,648,269,293
Adjustments for:
Depreciation, amortization and impairment
losses
5.d 1,329,696,603 733,837,566
Exchange gains/(losses) on foreign currency
assets and liabilities
41,292,295 136,964,008
Accruals to provisions 13,500,103 57,484,302
Dividends from subsidiaries, associates and
other companies
6 (8,770,435,089) (8,770,003,874) (4,450,596,876) (4,449,822,148)
Net financial (income)/expense 125,469,680 630,833,857 307,629,019 218,718,799
Cash flows from operating activities before
changes in net working capital
(209,200,618) 1,433,587,312
Increase/(Decrease) in provisions (74,223,632) (49,585,106)
(Increase)/Decrease in trade receivables
17 (19,074,769) (18,500,011) (35,635,336) (34,399,878)
(Increase)/Decrease in other financial and non-
financial assets/liabilities
573,538,442 1,028,253,294 1,453,742,895 (77,967,325)
Increase/(Decrease) in trade payables
28 (12,541,935) (19,491,987) 75,029,856 66,982,542
Interest income and other financial income
collected
1,803,097,466 685,825,927 984,985,579 709,947,923
Interest expense and other financial expense
paid
(2,058,692,623) (1,055,072,686) (1,101,636,478) (351,708,683)
Dividends from subsidiaries, associates and
other companies
6 9,112,358,781 9,111,955,231 4,550,337,971 4,549,614,807
Income taxes paid (consolidated taxation
mechanism)
(426,270,915) (552,962,935)
Cash flows from operating activities (a) 8,688,990,197 6,757,863,758
Investments in property, plant and equipment
and intangible assets
10-11 (45,254,041) (69,732,442)
Investments in equity investments
13 (1,739,147,822) (1,739,147,822) (10,338,316,034) (10,338,316,034)
Disinvestments from extraordinary transactions 136,635,930 136,635,930 668,617,876 668,617,876
Cash flows used in investing activities (b) (1,647,765,933) (9,739,430,600)
New long-term borrowing
24 4,250,921,203 410,711 9,203,788,683 7,700,000,000
Repayments of borrowings
24 (10,465,909,645) (5,117,740,779) (846,996,081) (46,307,451)
Net change in long-term borrowings/(loan
assets)
(1,159,334,729) (1,214,846,241) 183,426,475 886,526,527
Net change in short-term borrowings/(loans
assets)
8,267,773,610 8,090,248,848 (5,199,163,804) (5,453,274,956)
Dividends and interim dividends paid
23 (3,881,594,634) (3,664,298,335)
Issue/(Redemption) of hybrid bonds
23 - 2,213,861,760
Coupons paid to holders of hybrid bonds
(1)
23 (123,434,990) (70,554,749)
Purchase of treasury shares
23 (14,026,715) (12,755,469)
Cash flows from/(used in) financing activities (c) (3,125,605,900) 1,807,308,480
Increase/(Decrease) in cash and cash
equivalents (a+b+c)
3,915,618,364 (1,174,258,362)
Cash and cash equivalents at the beginning of
the year
21 952,254,599 2,126,512,961
Cash and cash equivalents at the end of the
year
21 4,867,872,963 952,254,599
(1) The figure for coupons paid to hybrid bond holders has been presented differently from that published in the separate financial statements for 2021.
76 Report and financial statements of Enel SpA at December 31, 2022
Notes to the separate financial
statements
1. Form and content of the separate financial statements
Enel SpA has its registered office in Viale Regina Marghe-
rita 137, Rome, Italy, and since 1999 has been listed on the
Mercato Telematico Azionario (Electronic Stock Exchange)
organized and operated by Borsa Italiana SpA.
Enel is an energy multinational and is one of the world’s
leading integrated operators in the electricity and gas in-
dustries, with a special focus on Europe and Latin America.
As the Parent, Enel SpA has prepared the consolidated
financial statements of the Enel Group as at and for the
year ended December 31, 2022, which are published in a
separate document.
The publication of these separate financial statements was
approved by the Board of Directors on March 16, 2023.
These separate financial statements have been audited by
KPMG SpA.
Basis of presentation
These separate financial statements for the year ended
December 31, 2022 represent the separate financial sta-
tements of the Parent, Enel SpA, and have been prepared
in accordance with international accounting standards (In-
ternational Accounting Standards - IAS and International
Financial Reporting Standards - IFRS) issued by the Inter-
national Accounting Standards Board (IASB), the interpre-
tations of the International Financial Reporting Interpreta-
tions Committee (IFRIC) and the Standing Interpretations
Committee (SIC), recognized in the European Union pur-
suant to Regulation (EC) no. 1606/2002 and in effect as of
the close of the year. All of these standards and interpreta-
tions are hereinafter referred to as the “IFRS-EU”.
These separate financial statements have also been pre-
pared in conformity with measures issued in implementa-
tion of Article 9, paragraph 3, of Legislative Decree 38 of
February 28, 2005.
The separate financial statements consist of the income
statement, the statement of comprehensive income, the
statement of financial position, the statement of changes
in equity and the statement of cash flows and the related
notes.
The assets and liabilities reported in the statement of fi-
nancial position are classified on a “current/non-current
basis”, with separate reporting of assets held for sale and
liabilities included in disposal groups classified as held for
sale. Current assets, which include cash and cash equiva-
lents, are assets that are intended to be realized, sold or
consumed during the normal operating cycle of the Com-
pany or in the 12 months following the close of the financial
year; current liabilities are liabilities that are expected to be
settled during the normal operating cycle of the Company
or within the 12 months following the close of the financial
year.
The income statement classifies costs on the basis of their
nature, with separate reporting of profit/(loss) from conti-
nuing operations and profit/(loss) from discontinued ope-
rations.
The statement of cash flows is prepared using the indirect
method, with separate reporting of any cash flows by ope-
rating, investing and financing activities associated with
discontinued operations.
For more information on cash flows in the statement of
cash flows, please see the section “Cash flows” in the Re-
port on Operations.
The separate financial statements have been prepared on
a going concern basis using the cost method, with the
exception of items measured at fair value in accordance
with IFRS-EU, as explained in the measurement criteria for
the individual items, and non-current assets and disposal
groups classified as held for sale, which are measured at
the lower between their carrying amount and the fair value
less costs to sell.
The separate financial statements are presented in euro,
the functional currency of the Company, and the figures
shown in the notes are reported in millions of euro unless
stated otherwise.
The separate financial statements provide comparative in-
formation in respect of the previous year.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
77Notes to the separate financial statements
2. Accounting policies
2.1 Focus on non-financial issues
(4) ESMA Public Statements no. 71-99-1864 of March 14, 2022 and no. 32-63-1277 of May 13, 2022 and no. 32-63-1320 of October 28, 2022; CONSOB Warning
Notices in the weekly notices of March 9-14, 2022 and March 10-21, 2022, and no. 3/22 of May 19, 2022.
Climate change disclosures
The move towards “net zero” is under way worldwide and
the processes of decarbonization and electrification of the
global economy are crucial to avoiding the serious conse-
quences of an increase in temperatures of over 1.5 °C.
With this outlook, the Group has set its strategic guidelines
as follows:
• allocate capital to support a decarbonized electricity
supply;
• enable the electrification of customers’ energy demand;
• leverage the creation of value along the value chain;
• bring forward achievement of the sustainable “net-zero”
goals to 2040.
Considering the risks related to climate change and the
provisions of the Paris Agreement, the Group has decided
to achieve the carbon neutrality objectives in advance and
reflect its impact in assets, liabilities, and profit or loss, hi-
ghlighting the significant and foreseeable impacts as re-
quired under the Conceptual Framework of the internatio-
nal accounting standards.
As regards the effects of issues related to climate change,
the Group considers climate change as an implicit element
in the application of methodologies and models used to
make estimates in the evaluation and/or measurement of
certain items. Furthermore, the Company has also taken
into account the impacts of climate change in its signifi-
cant management judgments.
For further details on the financial implications of issues
related to climate change, please see note 2.2 “Use of esti-
mates and management judgement” and to the notes re-
lating to specific items.
Disclosure of impact of Russia-Ukraine
conflict
During 2022, the Enel Group constantly monitored the ef-
fects of the international crisis on its business activities in
Russia (with particular regard to provisioning of materials,
services and labor), also assessing developments in mar-
ket variables (e.g., exchange rates, interest rates). The Enel
Group also took account of developments connected with
the counter-sanctions envisaged by Russia targeting in-
vestments held in the country.
In addition, the Enel Group assessed the indirect impacts
of the war in Ukraine on business activities, the financial
situation and economic performance in the main euro-a-
rea countries in which it operates, with particular regard to
shortages of raw materials from the areas affected by the
conflict and the generalized increase in commodity prices.
In consideration of the various recommendations of na-
tional and supranational supervisory bodies
(4)
concerning
this issue and in a constantly evolving scenario, characte-
rized by considerable regulatory uncertainty and high and
volatile prices, the Enel Group is constantly monitoring the
macroeconomic and business variables that enable a best
estimate of the potential impacts associated with regula-
tory changes, sanctions and restrictions on asset holdings,
as well as on suppliers and contracts applicable to the Enel
Group.
In this regard, it should be noted that no significant im-
pacts related to the Russia-Ukraine conflict have emerged
at December 31, 2022.
78 Report and financial statements of Enel SpA at December 31, 2022
2.2 Use of estimates and management judgment
Preparing these separate financial statements under IFRS-
EU requires management to take decisions and make
estimates and assumptions that may impact the carrying
amounts of revenue, costs, assets and liabilities and the
related disclosures concerning the items involved as well
as contingent assets and liabilities at the reporting date.
The estimates and management’s judgments are based
on previous experience and other factors considered re-
asonable in the circumstances. They are formulated when
the carrying amount of assets and liabilities is not easily
determined from other sources. The actual results may
therefore differ from these estimates. The estimates and
assumptions are periodically revised and the effects of any
changes are reflected through profit or loss if they only in-
volve that period. If the revision involves both the current
and future periods, the change is recognized in the year
in which the revision is made and in the related future pe-
riods.
In order to enhance understanding of the separate finan-
cial statements, the following sections examine the main
items affected by the use of estimates and the cases that
reflect management judgments to a significant degree,
underscoring the main assumptions used by management
in measuring these items in compliance with the IFRS-EU.
The critical element of such valuations is the use of as-
sumptions and professional judgments concerning issues
that are by their very nature uncertain.
Changes in the conditions underlying the assumptions
and judgments could have a substantial impact on future
results.
With regard to the effects of climate change issues, the
Company believes that climate change represents an im-
plicit element in the application of the methodologies and
models used to perform estimates in the valuation and/or
measurement of certain accounting items. Furthermore,
the Company has taken account of the impact of clima-
te change in the significant judgments made by manage-
ment.
Use of estimates
Recoverability of equity investments
The Company assesses the presence of evidence of im-
pairment of each equity investment at least once a year,
consistent with its strategy for managing the legal enti-
ties within the Group. If such evidence is found, the as-
sets involved undergo impairment testing. The processes
and procedures for determining the recoverable amount
of each equity investment are based on assumptions that
can be complex and whose nature requires management
to use its judgment, especially as regards the identifica-
tion of evidence of impairment, the forecasting of future
profitability over the horizon of the Group business plan,
the determination of the normalized cash flows underlying
the estimation of terminal value and the determination of
long-term growth rates and discount rates applied to fo-
recasts of future cash flows.
Impairment of non-financial assets
Assets such as property, plant and machinery and intangi-
ble assets are adjusted for impairment when their carrying
amount exceeds their recoverable amount, represented by
the higher of their fair value less costs to sell and their va-
lue in use.
The recoverable amount is assessed in accordance with
the criteria established by IAS 36, which are discussed in
greater detail in the appropriate notes to the separate fi-
nancial statements.
In determining the recoverable amount, the Company ge-
nerally applies the value in use criterion. Value in use is the
present value of the future cash flows that are expected
to be derived from the asset, discounted using a pre-tax
discount rate that reflects the current market assessmen-
ts of the time value of money and the risks specific to the
asset.
Future cash flows used to determine value in use are based
on the most recent business plan, approved by the mana-
gement, containing forecasts for volumes, revenue, ope-
rating costs and investments. These projections cover the
next three years. For subsequent years, account is taken of:
• assumptions concerning the long-term evolution of
the main variables considered in the calculation of cash
flows, as well as the average residual useful life of the
assets or the duration of the concessions, based on the
specific characteristics of the businesses;
• a long-term growth rate equal to the long-term growth
of electricity demand and/or inflation (depending on the
country and business) that does not in any case exceed
the average long-term growth rate of the market invol-
ved.
The recoverable amount is sensitive to the estimates and
assumptions used in the calculation of cash flows and the
discount rates applied. Nevertheless, possible changes in
the underlying assumptions on which the calculation of
such amounts is based could generate different recove-
rable amounts. The analysis of each group of non-financial
assets is unique and requires management to use estima-
tes and assumptions considered prudent and reasonable
in the specific circumstances.
In line with its business model and in the context of the
acceleration of the decarbonization of the generation mix
and driving the energy transition process, the Company
has also carefully assessed whether climate change issues
have affected the reasonable and supportable assumption
used to estimate expected cash flows. In this regard, whe-
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
79Notes to the separate financial statements
re necessary, the Company has also taken account of the
long-term impact of climate change, in particular by con-
sidering in the estimation of the terminal value a long-term
growth rate in line with the change in electricity demand
determined using energy models for each country.
Information on the main assumptions used to estimate
the recoverable amount of assets with reference to the
impacts relating to climate change, as well as information
on changes in these assumptions, is provided in the appli-
cable notes.
Expected credit losses on financial assets
At each reporting date, the Company recognizes a loss
allowance for expected credit losses on trade receivables
and other financial assets measured at amortized cost,
debt instruments measured at fair value through other
comprehensive income, contract assets and all other as-
sets in the scope.
Loss allowances for financial assets are based on assu-
mptions about risk of default and on the measurement of
expected credit losses. Management uses judgement in
making these assumptions and selecting the inputs for the
impairment calculation, based on the Company’s past hi-
story, existing market conditions as well as forward looking
estimates at the end of each reporting period.
The expected credit loss (ECL) – determined considering
probability of default (PD), loss given default (LGD), and
exposure at default (EAD) – is the difference between all
contractual cash flows that are due in accordance with the
contract and all cash flows that are expected to be recei-
ved (including shortfalls) discounted at the original effecti-
ve interest rate.
In particular, for trade receivables, contract assets and
right-of-use assets, including those with a significant fi-
nancial component, the Company applies the simplified
approach, determining expected credit losses over a pe-
riod corresponding to the entire life of the asset, generally
equal to 12 months.
Based on the specific reference market and the regulatory
context of the sector, as well as expectations of recovery
after 90 days, for such assets, the Company mainly ap-
plies a default definition of 180 days past due to determine
expected credit losses, as this is considered an effective
indication of a significant increase in credit risk. Accordin-
gly, financial assets that are more than 90 days past due
are generally not considered to be in default, except for
some specific regulated markets.
For trade receivables and contract assets the Company
mainly applies a collective approach based on grouping
the receivables into specific clusters. Only if the trade re-
ceivables are deemed to be individually significant by ma-
nagement and there is specific information about any si-
gnificant increase in credit risk does the Company apply an
analytical approach.
In case of individual assessment, PD is mainly obtained
from external providers.
Conversely, for collective assessment, trade receivables
are grouped based on shared credit risk characteristics
and past due information, considering a specific definition
of default.
The contract assets are considered to have substantially
the same risk characteristics as trade receivables for the
same types of contracts.
In order to measure the ECL for trade receivables on a col-
lective basis, as well as for contract assets, the Company
considers the following assumptions related to ECL para-
meters:
• PD, assumed as to be the average default rate, is calcu-
lated on a cluster basis and taking into consideration a
minimum of 24 months of historical data;
• LGD is function of the default bucket’s recovery rates,
discounted at the effective interest rate;
• EAD is estimated as the carrying exposure at the repor-
ting date net of cash deposits, including invoices issued
but not expired and invoices to be issued.
Based on specific management evaluations, the
forward-looking adjustment can be applied considering
qualitative and quantitative information in order to reflect
possible future events and macroeconomic scenarios,
which may affect the risk of the portfolio or the financial
instrument.
For additional details on the key assumptions and inputs
used please see note 32 “Financial instruments”.
Determining the fair value of financial
instruments
The fair value of financial instruments is determined on the
basis of prices directly observable in the market, where avai-
lable, or, for unlisted financial instruments, using specific va-
luation techniques (mainly based on present value) that ma-
ximize the use of observable market inputs. In rare circum-
stances where this is not possible, the inputs are estimated
by management taking due account of the characteristics
of the instruments being measured.
In accordance with IFRS 13, the Company includes a me-
asurement of credit risk, both of the counterparty (Credit
Valuation Adjustment or CVA) and its own (Debit Valuation
Adjustment or DVA), in order to adjust the fair value of fi-
nancial instruments for the corresponding amount of coun-
terparty risk, applying the method indicated in note 35 “Fair
value measurement”. Changes in the assumptions made in
estimating the input data could have an impact on the fair
value recognized for those instruments, especially in cur-
rent conditions, where markets are volatile and highly un-
certain and subject to rapid change.
80 Report and financial statements of Enel SpA at December 31, 2022
Pensions and other post-employment
benefits
Some of the Company’s employees participate in pension
plans offering benefits based on their wage history and ye-
ars of service. Certain employees are also eligible for other
post-employment benefit schemes.
The expenses and liabilities of such plans are calculated on
the basis of estimates carried out by consulting actuaries,
who use a combination of statistical and actuarial elemen-
ts in their calculations, including statistical data on past
years and forecasts of future costs. Other components of
the estimation that are considered include mortality and
retirement rates as well as assumptions concerning future
developments in discount rates, the rate of wage increa-
ses, the inflation rate and trends in healthcare cost.
These estimates can differ significantly from actual deve-
lopments owing to changes in economic and market con-
ditions, increases or decreases in retirement rates and the
lifespan of participants, as well as changes in the effective
cost of healthcare.
Such differences can have a substantial impact on the
quantification of pension costs and other related expen-
ses.
For further details on the main actuarial assumptions, ple-
ase refer to note 25 “Employee benefits”.
Provisions for risks and charges
Provisions are recognized where there is a legal or con-
structive obligation as a result of a past event at the end of
the reporting period, the settlement of which is expected
to result in an outflow of resources whose amount can
be reliably estimated. Where the impact is significant, the
accruals are determined by discounting expected future
cash flows using a pre-tax discount rate that reflects the
current market assessment of the time value of money
and, if applicable, the risks specific to the liability.
If the provision is discounted, the periodic adjustment of
the present value for the time factor is recognized as a fi-
nancial expense.
When the Company expects some or all of a provision to
be reimbursed, the reimbursement is recognized as a se-
parate asset, but only when the reimbursement is virtually
certain.
Provisions do not include liabilities to reflect uncertainties
in income tax treatments that are recognized as tax liabi-
lities.
In the case of contracts in which the unavoidable costs of
meeting the obligations under the contract exceed the
economic benefits expected to be received under it (one-
rous contracts), the Company recognizes a provision as
the lower of the costs of fulfilling the obligation that exce-
ed the economic benefits expected to be received under
the contract and any compensation or penalty arising
from failure to fulfil it.
Changes in estimates of accruals to the provision are re-
cognized in the income statement in the year in which the
changes occur.
For more details on provisions for risks and charges, please
see note 26 “Provisions for risks and charges”.
Note 40 “Contingent assets and liabilities” also provides
information regarding the most significant contingent lia-
bilities for the Company.
Litigation
The Company is involved in various civil, administrative
and tax disputes connected with the normal pursuit of
its activities that could give rise to significant liabilities. It
is not always objectively possible to predict the outcome
of these disputes. The assessment of the risks associa-
ted with this litigation is based on complex factors whose
very nature requires recourse to management judgments,
even when taking account of the contribution of external
advisors assisting the Company, about whether to classify
them as contingent liabilities or liabilities.
Provisions have been recognized to cover all significant
liabilities for cases in which legal counsel feels an adverse
outcome is likely and a reasonable estimate of the amount
of the loss can be made. Note 40 provides disclosures on
the Company’s most significant contingent liabilities.
Leases
When the interest rate implicit in the lease cannot be readily
determined, the Company uses the incremental borrowing
rate (IBR) at the lease commencement date to calculate the
present value of the lease payments. This is the interest rate
that the lessee would have to pay to borrow over a simi-
lar term, and with similar security, the funds necessary to
obtain an asset of a similar value to the right-of-use asset
in a similar economic environment. When no observable in-
puts are available, the Company estimates the IBR making
assumptions to reflect the terms and conditions of the lea-
se and certain entity-specific estimates.
One of the most significant judgments for the Company is
determining this IBR necessary to calculate the present va-
lue of the lease payments required to be paid to the lessor.
The Company’s approach to determining an IBR is based
on the assessment of the following three key components:
the risk-free rate, which considers the cash flows of the le-
ase payments, the economic environment where the lease
contract has been negotiated and the lease term; the credit
spread adjustment, in order to calculate an IBR that is speci-
fic for the lessee considering any underlying Parent or other
guarantee; and the lease-related adjustments, in order to
reflect in the IBR calculation the fact that the discount rate
is directly linked to the type of the underlying asset, rather
than being a general incremental borrowing rate. In parti-
cular, the risk of default is mitigated for the lessors as they
have the right to reclaim the underlying asset itself.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
81Notes to the separate financial statements
Recovery of deferred tax assets
At December 31, 2022, the separate financial statements
report deferred tax assets in respect of tax losses or tax
credits to be reversed in subsequent years and income
components whose deductibility is deferred in an amount
whose recovery is considered by management to be highly
probable.
The recoverability of such assets is subject to the achieve-
ment of future income sufficient to absorb such tax losses
and to use the benefits of the other deferred tax assets.
Significant management judgment is required to determi-
ne the amount of deferred tax assets that can be recogni-
zed, based upon the likely timing and the level of future
taxable income together with future tax planning strate-
gies and the tax rates applicable at the date of reversal.
However, where the Company should become aware that
it is unable to recover all or part of recognized tax assets in
future years, the consequent adjustment would be taken
to the income statement in the year in which this circum-
stance arises.
The recoverability of deferred tax assets is reviewed at the
end of each period. Deferred tax assets not recognized
are reassessed at each reporting date in order to verify the
conditions for their recognition.
Management judgment
Determining the useful life of non-financial
assets
In determining the useful life of property, plant and equi-
pment and intangible assets with a finite useful life, the
Company considers not only the future economic benefits
– contained in the assets – obtained through their use, but
also many other factors, such as physical wear and tear,
the technical, commercial or other obsolescence of the
product or service produced with the asset, legal or similar
limits (e.g., safety, environmental or other restrictions) on
the use of the asset, if the useful life of the asset depends
on the useful life of other assets.
Furthermore, in estimating the useful lives of the assets
concerned, the Company has taken account of its com-
mitment under the Paris Agreement.
Determination of the existence of control
Under the provisions of IFRS 10, control is achieved when the
Company is exposed, or has rights, to variable returns from
its involvement with the investee and has the ability to affect
those returns through its power over the investee. Power is
defined as the current ability to direct the relevant activities
of the investee based on existing substantive rights.
The existence of control does not depend solely on owner-
ship of a majority investment, but rather it arises from sub-
stantive rights that each investor holds over the investee.
Consequently, management must use its judgment in as-
sessing whether specific situations determine substantive
rights that give the Company the power to direct the rele-
vant activities of the investee in order to affect its returns.
For the purpose of assessing control, management analy-
zes all facts and circumstances including any agreements
with other investors, rights arising from other contractual
arrangements and potential voting rights (call options,
warrants, put options granted to non-controlling sharehol-
ders, etc.). These other facts and circumstances could be
especially significant in such assessment when the Com-
pany holds less than a majority of voting rights, or similar
rights, in the investee.
Furthermore, even if it holds more than half of the voting
rights in another entity, the Company considers all the
relevant facts and circumstances in assessing whether it
controls the investee.
The Company re-assesses whether or not it controls an
investee if facts and circumstances indicate that there are
changes to one or more of the elements considered in ve-
rifying the existence of control.
Finally, the assessment of the existence of control did not
find any situations of de facto control.
Determination of the existence of joint
control and of the type of joint arrangement
Under the provisions of IFRS 11, a joint arrangement is an
agreement where two or more parties have joint control.
Joint control only exists when the decisions over the rele-
vant activities require the unanimous consent of the par-
ties that share control.
A joint arrangement can be configured as a joint venture
or a joint operation. Joint ventures are joint arrangements
whereby the parties that have joint control have rights to
the net assets of the arrangement. Conversely, joint ope-
rations are joint arrangements whereby the parties that
have joint control have rights to the assets and obligations
for the liabilities relating to the arrangement.
In order to determine the existence of the joint control and
the type of joint arrangement, management must apply ju-
dgment and assess its rights and obligations arising from
the arrangement. For this purpose, the management con-
siders the structure and legal form of the arrangement,
the terms agreed by the parties in the contractual arrange-
ment and, when relevant, other facts and circumstances.
The Company re-assesses whether or not it has joint con-
trol if facts and circumstances indicate that changes have
occurred in one or more of the elements considered in ve-
rifying the existence of joint control and the type of the
joint arrangement.
82 Report and financial statements of Enel SpA at December 31, 2022
Determination of the existence of significant
influence over an associate
Associates are those in which the Company exercises si-
gnificant influence, i.e., the power to participate in the fi-
nancial and operating policy decisions of the investee but
not exercise control or joint control over those policies.
In general, it is presumed that the Company has a signi-
ficant influence when it has an ownership interest of 20%
or more.
In order to determine the existence of significant influence,
management must apply judgment and consider all facts
and circumstances.
Classification and measurement of financial
assets
At initial recognition, in order to classify financial assets
as financial assets at amortized cost, at fair value throu-
gh other comprehensive income and at fair value through
profit or loss, management assesses both the contractual
cash-flow characteristics of the instrument and the busi-
ness model for managing financial assets in order to ge-
nerate cash flows.
For the purpose of evaluating the contractual cash-flow
characteristics of the instrument, management performs
the SPPI test at an instrument level, in order to determine if
it gives rise to cash flows that are solely payments of prin-
cipal and interest (SPPI) on the principal amount outstan-
ding, performing specific assessment on the contractual
clauses of the financial instruments, as well as quantitative
analysis, if required.
The business model determines whether cash flows will
result from collecting contractual cash flows, selling the
financial assets, or both.
For more details, please see note 32 “Financial instrumen-
ts ”.
Hedge accounting
Hedge accounting is applied to derivatives in order to
reflect into the financial statements the effect of risk ma-
nagement strategies.
Accordingly, at the inception of the transaction the Com-
pany documents the hedge relationship between hedging
instruments and hedged items, as well as its risk manage-
ment objectives and strategy. The Company also assesses,
both at hedge inception and on an ongoing basis, whether
hedging instruments are highly effective in offsetting
changes in the fair values or cash flows of hedged items.
On the basis of management’s judgment, the effectiveness
assessment based on the existence of an economic rela-
tionship between the hedging instruments and the hed-
ged items, the dominance of credit risk in the changes in
fair value and the hedge ratio, as well as the measurement
of the ineffectiveness, is evaluated through a qualitative
assessment or a quantitative computation, depending on
the specific facts and circumstances and on the characte-
ristics of the hedged items and the hedging instruments.
For cash flow hedges of forecast transactions designated
as hedged items, management assesses and documents
that they are highly probable and present an exposure to
changes in cash flows that affect profit or loss.
For more details on the key assumptions used in assessing
effectiveness and measuring the ineffective portion of he-
dges, see note 34.1 “Hedge accounting”.
Leases
The complexity of the assessment of the lease contracts,
and also their long-term expiring date, requires a strong
professional judgments for the IFRS 16 application. In par-
ticular, for:
• the application of the definition of a lease to the cases
typical of the sectors in which the Company operates;
• the identification of the non-lease component in the le-
ase;
• the evaluation of any renewable and termination options
included in the lease in order to determine the term of
leases, also considering the probability of their exercise
and any significant leasehold improvements on the un-
derlying asset;
• the identification of any variable lease payments that
depend on an index or a rate to determine where the
changes of the latter impact the future lease payments
and also the amount of the right-of-use asset;
• the estimate of the discount rate to calculate the pre-
sent value of the lease payments; further details on as-
sumptions about this rate are provided in the paragraph
“Use of estimates”.
Uncertainty over income tax treatments
The Company determines whether to consider each un-
certain income tax treatment separately or together with
one or more other uncertain tax treatments as well as
whether to reflect the effect of uncertainty by using the
most likely amount or the expected value method, based
on which approach better predicts the resolution of the
uncertainty for each uncertain tax treatments.
The Company makes significant use of professional judg-
ment in identifying uncertainties about income tax treat-
ments and reviews the judgments and estimates made
in the event of a change in facts and circumstances that
could change its assessment of the acceptability of a spe-
cific tax treatment or the estimate of the effects of uncer-
tainty, or both.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
83Notes to the separate financial statements
2.3 Significant accounting policies
Related parties
Related parties are mainly those that share the same con-
trolling entity with Enel SpA, the companies that directly
or indirectly are controlled by Enel SpA, the associates or
joint ventures (including their subsidiaries) of Enel SpA, or
the associates or joint ventures (including their subsidia-
ries) of any Group company.
Related parties also include entities that operate post-em-
ployment benefit plans for employees of Enel SpA or its
associates (specifically, the FOPEN and FONDENEL pen-
sion funds), as well as the members of the boards of sta-
tutory auditors, and their immediate family, and the key
management personnel, and their immediate family, of
Enel SpA and its subsidiaries. Key management personnel
comprises management personnel who have the power
and direct or indirect responsibility for the planning, ma-
nagement and control of the activities of the company.
They include directors (whether executive or not).
Subsidiaries, associates and joint
ventures
The Company controls an entity when it is exposed to or
has rights to variable returns deriving from its involve-
ment, regardless of the nature of their formal relation-
ship, and has the ability, through the exercise of its power
over the investee, to affect its returns.
Associates comprise those entities in which the Com-
pany has a significant influence. Significant influence is
the power to participate in the financial and operating
policy decisions of investees but not exercise control or
joint control over those entities.
Joint ventures are joint arrangements over which the
Company exercises joint control and has rights to the net
assets of the arrangement. Joint control means sharing
control of an arrangement, which only exists when the
decisions over the relevant activities require the unani-
mous consent of all the parties that share control.
Equity investments in subsidiaries, associates and joint
ventures are measured at cost. Cost is adjusted for any
impairment losses, which are reversed where the rea-
sons for their recognition no longer obtain. The carrying
amount resulting from the reversal may not exceed the
original cost.
Where the loss pertaining to Enel SpA exceeds the car-
rying amount of the investment and the Company is obli-
gated to perform the legal or constructive obligations of
the investee or in any event to cover its losses, the excess
with respect to the carrying amount is recognized in liabi-
lities in the provision for risks and charges.
In the case of a disposal, without economic substance, of
an investment to an entity under common control, any dif-
ference between the consideration received and the car-
rying amount of the investment is recognized in equity.
Translation of foreign currency items
Transactions in currencies other than the functional cur-
rency are initially recognized at the spot exchange rate
prevailing on the date of the transaction.
Monetary assets and liabilities denominated in a foreign
currency other than the functional currency are subse-
quently translated using the closing exchange rate (i.e.,
the spot exchange rate prevailing at the reporting date).
Non-monetary assets and liabilities denominated in fo-
reign currency that are recognized at historical cost are
translated using the exchange rate at the date of the
transaction. Non-monetary assets and liabilities in forei-
gn currency measured at fair value are translated using
the exchange rate at the date that the fair value was de-
termined.
Any exchange differences are recognized through profit
or loss.
In determining the spot exchange rate to use on initial
recognition of the related asset, expense or income (or
part of it) on the derecognition of a non-monetary asset
or non-monetary liability relating to advance considera-
tion in foreign currency paid or received, the date of the
transaction is the date on which the Group initially reco-
gnizes the non-monetary asset or non-monetary liability
associated with the advance consideration.
If there are multiple advance payments or receipts, the
Company determines the transaction date for each pay-
ment or receipt of advance consideration.
Fair value measurement
For all fair value measurements and disclosures of fair va-
lue, that are either required or permitted by the IFRS, the
Company applies IFRS 13.
Fair value is defined as the price that would be received
to sell an asset or paid to transfer a liability, in an orderly
transaction, between market participants, at the measu-
rement date (i.e., an exit price).
The fair value measurement assumes that the transaction
to sell an asset or transfer a liability takes place in the
principal market, i.e., the market with the greatest volume
and level of activity for the asset or liability. In the absence
of a principal market, it is assumed that the transaction
takes place in the most advantageous market to which
84 Report and financial statements of Enel SpA at December 31, 2022
the Company has access, i.e., the market that maximizes
the amount that would be received to sell the asset or
minimizes the amount that would be paid to transfer the
liability.
The fair value of an asset or a liability is measured using
the assumptions that market participants would use
when pricing the asset or liability, assuming that market
participants act in their economic best interest. Market
participants are independent, knowledgeable sellers and
buyers who are able to enter into a transaction for the
asset or the liability and who are motivated but not forced
or otherwise compelled to do so.
When measuring fair value, the Company considers the
characteristics of the asset or liability, in particular:
• for a non-financial asset, a fair value measurement ta-
kes into account a market participant’s ability to gene-
rate economic benefits by using the asset in its highest
and best use or by selling it to another market partici-
pant that would use the asset in its highest and best
use;
• for liabilities and own equity instruments, the fair va-
lue reflects the effect of non-performance risk, i.e., the
risk that an entity will not fulfill an obligation, including
among others the credit risk of the Company itself;
• in the case of groups of financial assets and financial
liabilities with offsetting positions in market risk or cre-
dit risk, managed on the basis of an entity’s net expo-
sure to such risks, it is permitted to measure fair value
on a net basis.
In measuring the fair value of assets and liabilities, the
Company uses valuation techniques that are appropria-
te in the circumstances and for which sufficient data are
available, maximizing the use of relevant observable in-
puts and minimizing the use of unobservable inputs.
Property, plant and equipment
Property, plant and equipment is stated at cost, net of
accumulated depreciation and accumulated impairment
losses, if any. Such cost includes expenses directly attri-
butable to bringing the asset to the location and condi-
tion necessary for its intended use.
Subsequent costs are recognized as an increase in the
carrying amount of the asset when it is probable that fu-
ture economic benefits associated with the cost incurred
to replace a part of the asset will flow to the Company and
the cost of the item can be measured reliably. All other
costs are recognized in profit or loss as incurred.
Property, plant and equipment, net of its residual value,
is depreciated on a straight-line basis over its estimated
useful life, which is reviewed annually and, if appropriate,
adjusted prospectively. Depreciation begins when the as-
set is available for use.
The estimated useful life of the main items of property,
plant and equipment is as follows:
Depreciation period
Leasehold improvements
Shorter of the term of the
contract and residual useful life
Civil buildings 40 years
Other assets 7 years
Land is not depreciated as it has an indefinite useful life.
Assets recognized under property, plant and equipment
are derecognized either upon their disposal (i.e., at the
date the recipient obtains control) or when no future
economic benefit is expected from their use or disposal.
Leases
The Company holds property, plant and equipment for its
various activities under lease contracts. At inception of a
contract, the Company assesses whether a contract is, or
contains, a lease.
For contracts entered into or changed on or after January
1, 2019, the Company has applied the definition of a lea-
se under IFRS 16, that is met if the contract conveys the
right to control the use of an identified asset for a period
of time in exchange for consideration.
Conversely, for contracts entered into before January 1,
2019, the Company determined whether the arrange-
ment was or contained a lease under IFRIC 4.
At commencement or on modification of a contract that
contains a lease component and one or more additional
lease or non-lease components, the Company allocates
the consideration in the contract to each lease compo-
nent on the basis of its relative stand-alone prices.
The Company recognizes a right-of-use asset and a le-
ase liability at the commencement date of the lease (i.e.,
the date the underlying asset is available for use).
The right-of-use asset represents a lessee’s right to use
an underlying asset for the lease term; it is initially me-
asured at cost, which includes the initial amount of le-
ase liability adjusted for any lease payments made at or
before the commencement date less any lease incenti-
ves received, plus any initial direct costs incurred and an
estimate of costs to dismantle and remove the underlying
asset and to restore the underlying asset or the site on
which it is located.
The lease liability is initially measured at the present va-
lue of lease payments to be made over the lease term.
In calculating the present value of lease payments, the
Company uses the lessee’s incremental borrowing rate
at the lease commencement date when the interest rate
implicit in the lease is not readily determinable.
3
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Corporate governance
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Report on Operations
85Notes to the separate financial statements
Variable lease payments that do not depend on an index
or a rate are recognized as expenses in the year in which
the event or condition that triggers the payment occurs.
After the commencement date, the lease liability is me-
asured at amortized cost using the effective interest
method and is remeasured upon the occurrence of cer-
tain events.
The Company applies the short-term lease recognition
exemption to its lease contracts that have a lease term of
12 months or less from the commencement date. It also
applies the low-value assets recognition exemption to le-
ase contracts for which the underlying asset is of low-va-
lue whose amount is estimated not material. As example,
the Company has leases of certain office equipment (i.e.,
personal computers, printing and photocopying machi-
nes) that are considered of low-value. Lease payments
on short-term leases and leases of low-value assets are
recognized as expense on a straight-line basis over the
lease term.
The Company presents right-of-use assets that do not
meet the definition of investment property in “Property,
plant and equipment” and lease liabilities in “Borrowings”.
Consistent with the requirement of the standard, the
Company presents separately the interest expense on le-
ase liabilities under “Other financial expense” and the de-
preciation charge on the right-of-use assets under “De-
preciation, amortization and impairment losses”.
Intangible assets
Intangible assets are identifiable assets without physical
substance controlled by the Company and capable of ge-
nerating future economic benefits. They are measured at
purchase or internal development cost when it is probable
that the use of such assets will generate future economic
benefits and the related cost can be reliably determined.
The cost includes any directly attributable expenses ne-
cessary to make the assets ready for their intended use.
Development expenditure is recognized as an intangible
asset only when the Company can demonstrate the te-
chnical feasibility of completing the intangible asset and
that it has intention, ability and resources to complete the
asset in order to use or sell it.
Research costs are recognized as expenses.
Intangible assets with a finite useful life are recognized net
of accumulated amortization and any impairment losses.
Amortization is calculated on a straight-line basis over
the asset’s estimated useful life, which is reassessed at
least annually; any changes in amortization policies are
reflected on a prospective basis. Amortization commen-
ces when the asset is ready for use.
Consequently, intangible assets not yet available for use
are not amortized, but are tested for impairment at least
annually.
The Company’s intangible assets have a finite useful life.
Intangible assets comprise application software owned
by the Company with an expected useful life of between
three and five years.
Intangible assets are derecognized either at the time of
their disposal (at the date when the recipient obtains con-
trol) or when no future economic benefit is expected from
their use or disposal. Any gain or loss, recognized through
profit or loss, is calculated as the difference between the
net consideration received in the disposal, determined in
accordance with the provisions of IFRS 15 concerning the
transaction price, and carrying amount of the derecogni-
zed assets.
Impairment of non-financial assets
At each reporting date, non-financial assets are reviewed
to determine whether there is evidence of impairment.
Intangible assets with an indefinite useful life and intangi-
ble assets not yet available for use are tested for impair-
ment annually or more frequently if there is evidence sug-
gesting that the assets may be impaired.
If such evidence exists, the recoverable amount of each
asset involved is estimated on the basis of the use of the
asset and its future disposal, in accordance with the most
recent Group Business Plan. For more on the estimation
of the recoverable amount, please see the section “Use
of estimates”.
The recoverable amount is calculated for an individual
asset unless that asset is not capable of generating in-
coming cash flows that are largely independent of those
generated by other assets or groups of assets.
If the carrying amount of an asset is greater than its reco-
verable amount, an impairment loss is recognized in profit
or loss under “Depreciation, amortization and impairment
losses”.
If the reasons for a previously recognized impairment loss
no longer obtain, the carrying amount of the asset is re-
stored through profit or loss, under “Depreciation, amor-
tization and impairment losses”, in an amount that shall
not exceed the carrying amount that the asset would have
had if the impairment loss had not been recognized and
depreciation or amortization had been performed.
86 Report and financial statements of Enel SpA at December 31, 2022
Financial instruments
Financial instruments are any contract that gives rise to a
financial asset of one entity and a financial liability or equi-
ty instrument of another entity; they are recognized and
measured in accordance with IAS 32 and IFRS 9.
A financial asset or liability is recognized when, and only
when, the Company becomes party to the contractual
provision of the instrument (trade date).
Trade receivables arising from contracts with customers,
in the scope of IFRS 15, are initially measured at their tran-
saction price (as defined in IFRS 15) if such receivables do
not contain a significant financing component or when
the Company applies the practical expedient allowed by
IFRS 15.
Conversely, the Company initially measures financial as-
sets other than the trade receivables noted above at their
fair value plus, in the case of a financial asset not recogni-
zed at fair value through profit or loss, transaction costs.
Financial assets are classified at initial recognition as fi-
nancial assets at amortized cost, at fair value through
other comprehensive income and at fair value through
profit or loss, on the basis of both Company’s business
model and the contractual cash-flow characteristics of
the instrument.
For this purpose, the assessment to determine whether
the instrument gives rise to cash flows that are solely
payments of principal and interest (SPPI) on the principal
amount outstanding is referred to as the SPPI test and is
performed at an instrument level.
The Company’s business model for managing financial as-
sets refers to how it manages its financial assets in order
to generate cash flows. The business model determines
whether cash flows will result from collecting contractual
cash flows, selling the financial assets, or both.
For purposes of subsequent measurement, financial as-
sets are classified in three categories:
• financial assets measured at amortized cost (debt in-
struments);
• financial assets at fair value through OCI with no reclas-
sification of cumulative gains and losses upon dereco-
gnition (equity instruments); and
• financial assets at fair value through profit or loss.
Financial assets measured at amortized cost
This category mainly includes trade receivables, other fi-
nancial assets and loan assets.
Financial assets at amortized cost are held within a busi-
ness model whose objective is to hold financial assets in
order to collect contractual cash flows and whose con-
tractual terms give rise, on specified dates, to cash flows
that are solely payments of principal and interest on the
principal amount outstanding.
Such assets are initially recognized at fair value, adjusted
for any transaction costs, and subsequently measured at
amortized cost using the effective interest method and are
subject to impairment.
Gains and losses are recognized in profit or loss when the
asset is derecognized, modified or impaired.
Financial assets at fair value through other
comprehensive income (FVOCI) - Equity
instruments
This category includes mainly equity investments in other
entities irrevocably designated as such upon initial reco-
gnition.
Gains and losses on these financial assets are never re-
classified to profit or loss. The Company may transfer the
cumulative gain or loss within equity.
Equity instruments designated at fair value through OCI
are not subject to impairment testing.
Dividends on such investments are recognized in profit or
loss unless they clearly represent a recovery of a part of the
cost of the investment.
Financial assets at fair value through profit or
loss
This category mainly includes: securities, equity invest-
ments in other companies, financial investment in fund
held for trading and financial assets designated as at fair
value through profit or loss at initial recognition.
Financial assets at fair value through profit or loss are:
• financial assets with cash flows that are not solely pay-
ments of principal and interest, irrespective of the busi-
ness model;
• financial assets held for trading because acquired or in-
curred principally for the purpose of selling or repurcha-
sing in short term;
• debt instruments designated upon initial recognition,
under the option allowed by IFRS 9 (fair value option) if
doing so eliminates, or significantly reduces, an accoun-
ting mismatch;
• derivatives, including separated embedded derivatives,
held for trading or not designated as effective hedging
instruments.
Such financial assets are initially recognized at fair value
with subsequent gains and losses from changes in their
fair value recognized through profit or loss.
This category also includes listed equity investments which
the Company had not irrevocably elected to classify at fair
value through OCI. Dividends on listed equity investments
are also recognized as other income in the income state-
ment when the right of payment has been established.
Financial assets that qualify as contingent consideration
are also measured at fair value through profit or loss.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
87Notes to the separate financial statements
Impairment of financial assets
At each reporting date, the Company recognizes a loss
allowance for expected credit losses on trade receivables
and other financial assets measured at amortized cost,
debt instruments measured at fair value through other
comprehensive income (FVOCI), contract assets and all
other assets within the scope of IFRS 9.
In compliance with IFRS 9, since January 1, 2018, the Com-
pany has adopted a new impairment model based on the
determination of expected credit losses (ECL) using a
forward-looking approach. In essence, the model provides
for:
• the application of a single framework for all financial as-
sets;
• the recognition of expected credit losses on an ongoing
basis and the updating of the amount of such losses at
the end of each reporting period, reflecting changes in
the credit risk of the financial instrument;
• the measurement of expected losses on the basis of
reasonable information, obtainable without undue cost,
about past events, current conditions and forecasts of
future conditions.
For trade receivables, contract assets and lease recei-
vables, including those with a significant financial compo-
nent, the Company adopts the simplified approach, deter-
mining expected credit losses over a period correspon-
ding to the entire life of the receivable, generally equal to
12 months.
For all financial assets other than trade receivables, con-
tract assets and lease receivables, the Company applies
the general approach under IFRS 9, based on the asses-
sment of a significant increase in credit risk since initial re-
cognition. Under this approach, a loss allowance on finan-
cial assets is recognized at an amount equal to the lifetime
expected credit losses, if the credit risk on those financial
assets has increased significantly, since initial recognition,
considering all reasonable and supportable information,
including also forward-looking inputs.
If at the reporting date, the credit risk on financial assets
has not increased significantly since initial recognition, the
Company measures the loss allowance for those financial
assets at an amount equal to 12-month expected credit
losses.
For financial assets on which a loss allowance equal to li-
fetime expected credit losses has been recognized in the
previous reporting period, the Company measures the loss
allowance at an amount equal to 12-month expected cre-
dit losses when the condition regarding a significant incre-
ase in credit risk is no longer met.
The Company recognizes in profit or loss, as an impair-
ment gain or loss, the amount of expected credit losses
(or reversal) that is required to adjust the loss allowance
at the reporting date to the amount that is required to be
recognized in accordance with IFRS 9.
Cash and cash equivalents
This category includes deposits that are available on de-
mand or at very short term, as well as highly liquid finan-
cial investments that are readily convertible into a known
amount of cash and which are subject to insignificant risk
of changes in value.
For the purposes of the statement of cash flows, cash and
cash equivalents do not include bank overdrafts at the re-
porting date.
Financial liabilities at amortized cost
This category mainly includes borrowings, trade payables,
lease liabilities and debt instruments.
Financial liabilities, other than derivatives, are recognized
when the Company becomes a party to the contractual
clauses of the instrument and are initially measured at fair
value adjusted for directly attributable transaction costs.
Financial liabilities are subsequently measured at amor-
tized cost using the effective interest rate method. The
effective interest rate is the rate that exactly discounts
the estimated future cash payments or receipts over the
expected life of the financial instrument or a shorter pe-
riod, where appropriate, to the carrying amount of the fi-
nancial asset or liability.
Financial liabilities at fair value through
profit or loss
Financial liabilities at fair value through profit or loss inclu-
de financial liabilities held for trading and financial liabilities
designated upon initial recognition as at fair value through
profit or loss.
Financial liabilities are classified as held for trading if they
are incurred for the purpose of repurchasing in the near
term. This category also includes derivative financial in-
struments entered into by the Company that are not de-
signated as hedging instruments in hedge relationships
as defined by IFRS 9. Separated embedded derivatives are
also classified as at fair value through profit or loss unless
they are designated as effective hedging instruments.
Gains or losses on liabilities at fair value through profit or
loss are recognized in profit or loss.
Financial liabilities designated upon initial recognition at
fair value through profit or loss are designated at the initial
date of recognition, only if the criteria in IFRS 9 are sati-
sfied.
88 Report and financial statements of Enel SpA at December 31, 2022
In this case, the portion of the change in the fair value attri-
butable to own credit risk is recognized in OCI.
The Company has not designated any financial liability as
at fair value through profit or loss, upon initial recognition.
Financial liabilities that qualify as contingent consideration
are also measured at fair value through profit or loss.
Derecognition of financial assets and
liabilities
Financial assets are derecognized whenever one of the
following conditions is met:
• the contractual right to receive the cash flows associa-
ted with the asset expires;
• the Company has transferred substantially all the risks
and rewards associated with the asset, transferring its
rights to receive the cash flows of the asset or assuming
a contractual obligation to pay such cash flows to one or
more beneficiaries under a contract that meets the re-
quirements provided by IFRS 9 (the “pass through test”);
• the Company has not transferred or retained substan-
tially all the risks and rewards associated with the asset
but has transferred control over the asset.
Financial liabilities are derecognized when they are extin-
guished, i.e., when the contractual obligation has been di-
scharged, cancelled or expired.
When an existing financial liability is replaced by another
from the same lender on substantially different terms, or
the terms of an existing liability are substantially modi-
fied, such an exchange or modification is treated as the
derecognition of the original liability and the recognition
of a new liability. The difference in the respective carrying
amounts is recognized in profit or loss.
Derivative financial instruments
A derivative is a financial instrument or another contract:
• whose value changes in response to the changes in an
underlying variable such as an interest rate, commodity
or security price, foreign exchange rate, a price or rate
index, a credit rating or other variable;
• that requires no initial net investment, or one that is
smaller than would be required for a contract with similar
response to changes in market factors;
• that is settled at a future date.
Derivative instruments are classified as financial assets or
liabilities depending on the positive or negative fair value
and they are classified as “held for trading” within “Other
business models” and measured at fair value through pro-
fit or loss, except for those designated as effective hed-
ging instruments.
All derivatives held for trading are classified as current as-
sets or liabilities.
Derivatives not held for trading purposes, but measured at
fair value through profit or loss since they do not qualify for
hedge accounting and derivative designated as effective
hedging instruments are classified as current or not cur-
rent on the basis of their maturity date and the Company
intention to hold the financial instrument until maturity or
not.
For more details about derivatives and hedge accounting,
please see note 34.1 “Hedge accounting”.
Offsetting financial assets and liabilities
The Company offsets financial assets and liabilities when:
• there is a legally enforceable right to set off the recogni-
zed amounts, and
• there is the intention of either to settle on a net basis, or
to realize the asset and settle the liability simultaneously.
Non-current assets (or disposal groups)
classified as held for sale and discontinued
operations
Non-current assets (or disposal groups) are classified as
held for sale if their carrying amount will be recovered prin-
cipally through a sale transaction, rather than through con-
tinuing use.
This classification criterion is applicable only when non-cur-
rent assets (or disposal groups) are available in their present
condition for immediate sale and the sale is highly probable.
If the Company is committed to a sale plan involving loss of
the asset and the requirements provided for under IFRS 5
are met, all the assets and liabilities of that subsidiary are
classified as held for sale when the classification criteria
are met, regardless of whether the Company will retain a
non-controlling interest in its former subsidiary after the
sale.
The Company applies these classification criteria as envi-
saged in IFRS 5 to an investment, or a portion of an invest-
ment, in an associate or a joint venture. Any retained portion
of an investment in an associate or a joint venture that has
not been classified as held for sale is accounted for using
the equity method until disposal of the portion that is classi-
fied as held for sale takes place.
Non-current assets (or disposal groups) and liabilities of di-
sposal groups classified as held for sale are presented se-
parately from other assets and liabilities in the statement of
financial position.
The amounts presented for non-current assets or for the
assets and liabilities of disposal groups classified as held for
sale are not reclassified or re-presented for prior periods
presented.
Immediately before the initial classification of non-current
assets (or disposal groups) as held for sale, the carrying
3
Separate financial statements
2
Corporate governance
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1
Report on Operations
89Notes to the separate financial statements
amounts of such assets (or disposal groups) are measured
in accordance with the accounting standard applicable to
those assets or liabilities. Non-current assets (or disposal
groups) classified as held for sale are measured at the lower
of their carrying amount and fair value less costs to sell. Im-
pairment losses for any initial or subsequent writedown of
the assets (or disposal groups) to fair value less costs to sell
and gains for their reversals are recognized in profit or loss
from continuing operations.
If the classification criteria are no longer met, the Company
ceases to classify the non-current assets (or disposal group)
as held for sale. In this case they are measured at the lower
of:
• the carrying amount before the asset (or disposal group)
was classified as held for sale, adjusted for any depre-
ciation, amortization or reversals of impairment losses
that would have been recognized if the asset (or disposal
group) had not been classified as held for sale; and
• the recoverable amount, which is equal to the greater of
its fair value net of costs to sell and its value in use, as
calculated at the date of the subsequent decision not
to sell.
Any adjustment to the carrying amount of a non-current as-
set that ceases to be classified as held for sale is included in
profit or loss from continuing operations.
A discontinued operation is a component of the Company
that either has been disposed of, or is classified as held for
sale, and:
• represents a separate major business line or geographi-
cal segment;
• is part of a single coordinated plan to dispose of a se-
parate major business line or geographical segment; or
• is a subsidiary acquired exclusively with a view to resale.
The Company presents, in a separate line item of the in-
come statement, a single amount comprising the total of:
• the post-tax profit or loss of discontinued operations;
and
• the post-tax gain or loss recognized on the measure-
ment to fair value less costs to sell or on the disposal of
the assets or disposal groups constituting the disconti-
nued operation.
The corresponding amount is restated in the income sta-
tement for prior periods presented in the financial sta-
tements, so that the disclosures relate to all operations
that are discontinued by the end of the current reporting
period. If the Company ceases to classify a component
as held for sale, the results of the component previously
presented in discontinued operations are reclassified and
included in profit or loss from continuing operations for all
periods presented.
Employee benefits
Liabilities related to employee benefits paid upon or after
ceasing employment in connection with defined benefit
plans or other long-term benefits accrued during the em-
ployment period are determined separately for each plan,
using actuarial assumptions to estimate the amount of the
future benefits that employees have accrued at the repor-
ting date (using the projected unit credit method). More
specifically, the present value of the defined benefit obli-
gation is calculated by using a discount rate determined
on the basis of market yields at the end of the reporting
period on high-quality corporate bonds. If there is no deep
market for high-quality corporate bonds in the currency in
which the bond is denominated, the corresponding yield
of government securities is used.
The liability, net of any plan assets, is recognized on an
accrual basis over the vesting period of the related rights.
These appraisals are performed by independent actuaries.
If the plan assets exceed the present value of the related
defined benefit obligation, the surplus (up to the limit of
any cap) is recognized as an asset.
As regards the liabilities (assets) of defined benefit plans,
the cumulative actuarial gains and losses from the actua-
rial measurement of the liabilities, the return on the plan
assets (net of the associated interest income) and the
effect of the asset ceiling (net of the associated interest)
are recognized in other comprehensive income when they
occur. For other long-term benefits, the related actuarial
gains and losses are recognized through profit or loss.
In the event of a change being made to an existing defi-
ned benefit plan or the introduction of a new plan, any past
service cost is recognized immediately in profit or loss.
The Company is also involved in defined contribution plans
under which it pays fixed contributions to a separate entity
(a fund) and has no legal or constructive obligation to pay
further contributions if the fund does not hold sufficient
assets to pay all employee benefits relating to employee
service in the current and prior periods. Such plans are
usually aimed to supplement pension benefits due to em-
ployees post-employment. The related costs are recogni-
zed in profit or loss on the basis of the amount of contri-
butions paid in the year.
Termination benefits
Liabilities for benefits due to employees for the early ter-
mination of employee service arise out of the Company’s
decision to terminate an employee’s employment before
the normal retirement date or an employee’s decision to
accept an offer of benefits in exchange for the termination
90 Report and financial statements of Enel SpA at December 31, 2022
of employment. The event that gives rise to an obligation is
the termination of employment rather than employee ser-
vice. Termination benefits are recognized at the earlier of
the following dates:
• when the Company can no longer withdraw its offer of
benefits; and
• when the Company recognizes a cost for a restructuring
that is within the scope of IAS 37 and involves the pay-
ment of termination benefits.
The liabilities are measured on the basis of the nature of
the employee benefits. More specifically, when the bene-
fits represent an enhancement of other post-employment
benefits, the associated liability is measured in accordance
with the rules governing that type of benefits. Otherwise,
if the termination benefits due to employees are expected
to be settled wholly within 12 months of the close of the
year in which those benefits are recognized, the Company
measures the liability in accordance with the requirements
for short-term employee benefits; if they are not expected
to be settled wholly within 12 months of the close of the
year in which those benefits are recognized, the Company
measures the liability in accordance with the requirements
for other long-term employee benefits.
Share-based payments
The Company undertakes share-based payment tran-
sactions settled with equity instruments as part of the re-
muneration policy adopted for the Chief Executive Officer
and General Manager and for key management personnel.
The most recent long-term incentive plans provide for
the grant to recipients of an incentive represented by an
equity component (settled with equity instruments) and
a monetary component (paid in cash), which will accrue if
specific conditions are met. The monetary component is
classified as a cash-settled transaction if it is based on the
price (or value) of the equity instruments of the company
that issued the plan or, in other cases, as another long-
term employee benefit. In order to settle the equity com-
ponent through the bonus award of Enel shares, a program
for the purchase of treasury shares to support these plans
was approved. For more details on share-based incentive
plans, please see note 36 “Share-based payments”.
For the equity component, the Company recognizes the
services rendered by employees as personnel expenses
over the period in which the conditions for remaining in
service and for achieving certain results must be satisfied
(vesting period) and indirectly estimates their value, and
the corresponding increase in equity, on the basis of the
fair value of the equity instruments (i.e., the issuer shares)
at the grant date. This fair value is based on the observable
market price of the share, taking account of the terms and
conditions under which the shares were granted (with the
exception of vesting conditions excluded from the measu-
rement of fair value).
The overall expense recognized is adjusted at each repor-
ting date until the vesting date to reflect the best estimate
available to Enel of the number of equity instruments for
which the service and performance conditions other than
market conditions will be satisfied, so that the amount re-
cognized at the end is based on the effective number of
equity instruments that satisfy the service and performan-
ce conditions other than market conditions at the vesting
date.
No expense is recognized for awards which ultimately do
not vest because the performance conditions other than
market conditions and/or the service conditions have not
been satisfied. Conversely, the transactions are consi-
dered to have vested irrespective of whether the market
or non-vesting conditions are satisfied, provided that all
other vesting conditions are met.
If the incentive based on equity instruments is paid in
cash, the Company recognizes the services rendered by
employees as personnel expenses over the vesting period
and a corresponding liability measured at the fair value of
the liability incurred. Subsequently, and until its extinction,
the liability is remeasured at fair value at each reporting
date, considering the best possible estimate of the incen-
tive that will vest, with changes in the fair value recognized
under personnel expenses. If the right to receive the mo-
netary incentive does not vest because one or more con-
ditions are not met, the related liability is reversed.
Provisions for risks and charges
Provisions are recognized where there is a legal or con-
structive obligation as a result of a past event at the end of
the reporting period, the settlement of which is expected
to result in an outflow of resources whose amount can
be reliably estimated. Where the impact is significant, the
accruals are determined by discounting expected future
cash flows using a pre-tax discount rate that reflects the
current market assessment of the time value of money
and, if applicable, the risks specific to the liability.
If the provision is discounted, the periodic adjustment of
the present value for the time factor is recognized as a fi-
nancial expense.
When the Company expects some or all charges to be
reimbursed, the reimbursement is recognized as a sepa-
rate asset, but only when the reimbursement is virtually
certain.
Provisions do not include liabilities to reflect uncertainties
in income tax treatments that are recognized as tax liabi-
lities.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
91Notes to the separate financial statements
In the case of contracts in which the unavoidable costs
of meeting the obligations under the contract exceed
the economic benefits expected to be received under it
(onerous contracts), the Company recognizes a provision
as the lower of the excess of unavoidable costs of mee-
ting the obligations (i.e., costs that relate directly to the
contract, whether incremental or resulting from an allot-
ment of other costs) under the contract over the eco-
nomic benefits expected to be received under it and any
compensation or penalty arising from failure to fulfil it.
Changes in estimates of accruals to the provision are re-
cognized in the income statement in the year in which the
changes occur.
Revenue from contracts with customers
The Company recognizes revenue from contracts with
customers at an amount that reflects the consideration
to which the Company expects to be entitled in exchange
for those goods or services using a five-step model pro-
vided for in IFRS 15:
• identify the contract with the customer (step 1);
• identify the performance obligations in the contract
(step 2);
• determine the transaction price (step 3);
• allocate the transaction price (step 4);
• recognize revenue (step 5).
The Company recognizes revenue when (or as) each per-
formance obligation is satisfied by transferring the pro-
mised good or service to the customer.
Financial income and expense from
derivatives
Financial income and expense from derivatives include:
• income and expense from derivatives measured at fair
value through profit or loss on interest rate and curren-
cy risk;
• income and expense from fair value hedge derivatives
on interest rate risk;
• income and expense from cash flow hedge derivatives
on interest rate and currency risks.
Other financial income and expense
For all financial assets and liabilities measured at amorti-
zed cost and interest-bearing financial assets classified
as at fair value through other comprehensive income, in-
terest income and expense are recognized using the ef-
fective interest rate method.
Interest income is recognized to the extent that it is pro-
bable that the economic benefits will flow to the Com-
pany and the amount can be reliably measured.
Other financial income and expense include also chan-
ges in the fair value of financial instruments other than
derivatives.
Dividends
Dividends are recognized when the unconditional right to
receive payment is established.
Dividends and interim dividends payable to the Com-
pany’s shareholders are recognized as changes in equity
in the period in which they are approved by the Sharehol-
ders’ Meeting and the Board of Directors, respectively.
Income taxes
Current income taxes
Current income taxes for the year, which are recognized
under “Income tax liabilities” net of payments on account,
or under “Tax assets” where there is a credit balance, are
determined using an estimate of taxable income and in
conformity with the applicable regulations.
Such liabilities and assets are determined using the
tax rates and tax laws that are enacted or substantively
enacted by the end of the reporting period in the coun-
tries where taxable income has been generated.
Current income taxes are recognized in profit or loss with
the exception of current income taxes related to items
recognized outside profit or loss that are recognized in
equity.
Deferred tax liabilities and assets
Deferred tax liabilities and assets are calculated on the
temporary differences between the carrying amounts of
liabilities and assets in the financial statements and their
corresponding amounts recognized for tax purposes on
the basis of tax rates in effect on the date the temporary
difference will reverse, which is determined on the basis
of tax rates that are enacted or substantively enacted as
at end of the reporting period.
Deferred tax liabilities are recognized for all taxable tem-
porary differences, except when such liability arises from
the initial recognition of goodwill or in respect of taxable
temporary differences associated with investments in
subsidiaries, associates and interests in joint ventures,
when the Company can control the timing of the reversal
of the temporary differences and it is probable that the
temporary differences will not reverse in the foreseeable
future.
Deferred tax assets are recognized for all deductible
temporary differences, the carryforward of tax losses and
92 Report and financial statements of Enel SpA at December 31, 2022
unused tax credits. For more information concerning the
recoverability of such assets, please see the appropriate
section of the discussion of estimates.
Deferred taxes and liabilities are recognized in profit or
loss, with the exception of those in respect of items reco-
gnized outside profit or loss that are recognized in equity.
Deferred tax assets and deferred tax liabilities are offset
only if there is a legally enforceable right to offset current
tax assets with current tax liabilities and when they relate
to income taxes levied by the same taxation authority on
either the same taxable entity or different taxable entities
which intend either to settle current tax liabilities and as-
sets on a net basis, or to realize the assets and settle the
liabilities simultaneously, in each future period in which
significant amounts of deferred tax liabilities or assets are
expected to be settled or recovered.
Uncertainty over income tax treatments
In defining “uncertainty“, it shall be considered whether a
particular tax treatment will be accepted by the relevant
taxation authority. If it is deemed probable that the tax
treatment will be accepted (where the term “probable“ is
defined as “more likely than not“), then the Company re-
cognizes and measures its current/deferred tax asset or
liabilities applying the requirements in IAS 12.
Conversely, when the Company feels that it is not likely
that the taxation authority will accept the tax treatment
for income tax purposes, the Company reflects the un-
certainty in the manner that best predicts the resolution
of the uncertain tax treatment. The Company determines
whether to consider each uncertain tax treatment sepa-
rately or together with one or more other uncertain tax
treatments based on which approach provides better
predictions of the resolution of the uncertainty. In asses-
sing whether and how the uncertainty affects the tax tre-
atment, the Company assumes that a taxation authority
will accept or not an uncertain tax treatment supposing
that the taxation authority will examine amounts it has
a right to examine and have full knowledge of all related
information when making those examinations. The Com-
pany reflects the effect of uncertainty in accounting for
current and deferred tax, using the expected value or the
most likely amount, whichever method better predicts
the resolution of the uncertainty.
Since uncertain income tax positions meet the definition
of income taxes, the Company presents uncertain tax lia-
bilities/assets as current tax liabilities/assets or deferred
tax liabilities/assets.
3. New and amended standards and interpretations
The Company has applied the following standards, inter-
pretations and amendments that took effect as from Ja-
nuary 1, 2023.
• “Amendments to IFRS 3 - Reference to the Conceptual
Framework”, issued in May 2020. The amendments are
intended to replace a reference to the definitions of as-
sets and liabilities provided by the Revised Conceptual
Framework for Financial Reporting issued in March 2018
(Conceptual Framework) without significantly changing
its provisions.
The amendments also add to IFRS 3 a requirement that,
for transactions and other events within the scope of
“IAS 37 - Provisions, contingent liabilities and contingent
assets” or “IFRIC 21 - Levies”, an acquirer applies IAS 37
or IFRIC 21 (instead of the Conceptual Framework) to
identify the liabilities it has assumed in a business com-
bination.
Finally, the amendments clarify the existing guidelines
in IFRS 3 for contingent assets acquired in a business
combination, specifying that, if it is not sure that an as-
set exists at the acquisition date, the contingent asset
shall not be recognized.
• “Amendments to IAS 16 - Property, Plant and Equipment:
Proceeds before Intended Use”, issued in May 2020. The
amendments prohibit a company from deducting from
the cost of property, plant and equipment amounts re-
ceived from selling items produced while the company is
preparing the asset for its intended use. Instead, a com-
pany will recognize such sales proceeds and related cost
in profit or loss.
• “Amendments to IAS 37 - Onerous Contracts - Costs
of Fulfilling a Contract”, issued in May 2020. The amend-
ments specify which costs an entity includes in determi-
ning the cost of fulfilling a contract for the purpose of
assessing whether the contract is onerous. To this end,
the cost of fulfilling a contract comprises the costs that
relate directly to the contract. These consist of the incre-
mental costs of fulfilling that contract or the allotment of
other costs that relate directly to fulfilling contracts.
• “Annual improvements to IFRS Standards 2018-2020”,
issued in May 2020. The document mainly comprises
amendments to the following standards:
– “First-Time Adoption of International Financial Repor-
ting Standards”; the amendment simplifies the appli-
cation of IFRS 1 by an investee (subsidiary, associate
or joint venture) that becomes a first-time adopter
of IFRS Standards after its parent has already adop-
ted them. More specifically, if the investee adopts
the IFRSs after its parent and applies IFRS 1.D16 (a),
then the investee can elect to measure the cumula-
tive translation differences for all foreign operations
at the amounts that would be included in the parent’s
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
93Notes to the separate financial statements
consolidated financial statements, based on parent’s
date of transition to the IFRSs;
– “IFRS 9 - Financial Instruments”; with regard to fees
included in the “10 per cent” test for derecognition
of financial liabilities, the amendment clarifies the
fees that an entity includes when assessing whether
the terms of a new or modified financial liability are
substantially different from the terms of the original
financial liability. In determining those fees paid net
of fees received, the borrower shall include only fees
paid or received between the borrower and the len-
der, including fees paid or received by either the bor-
rower or lender on the other party’s behalf;
– “IFRS 16 - Leases”; the International Accounting
Standards Board amended Illustrative Example 13
accompanying “IFRS 16 - Leases”. Specifically, the
amendment eliminates the potential for confusion in
the application of IFRS 16 created by the way in whi-
ch Illustrative Example 13 had illustrated the require-
ments for lease incentives. The example had included
a reimbursement relating to leasehold improvements
without explaining whether the reimbursement quali-
fied as a lease incentive. The amendment removes the
illustration of a reimbursement relating to leasehold
improvements from the example;
– “IAS 41 - Agriculture”; the amendment removes the
requirement for entities to exclude cash flows for ta-
xation when measuring fair value. Accordingly, enti-
ties shall use pre-tax cash flows and a pre-tax rate to
discount those cash flows.
The application of these amendments did not have a ma-
terial impact on these separate financial statements.
Information on the Income Statement
Revenue
4.a Revenue from sales and services – €116 million
Millions of euro
2022 2021 Change
Revenue from sales and services
Group companies 116 125 (9)
Third parties - - -
Total revenue from sales and services 116 125 (9)
“Revenue from sales and services” includes management
services provided to the subsidiaries within the manage-
ment and coordination role as Parent Company (€69 mil-
lion), IT services (€39 million) and other services (€8 million).
The decrease of €9 million reflected the decrease in reve-
nue from management services (€8 million) and IT services
(€4 million), which was partially offset by the increase in re-
venue from other services (€3 million).
Revenue from sales and services breaks down by geo-
graphical segment as follows:
• €51 million in Italy (€59 million in 2021);
• €27 million in the European Union (€24 million in 2021);
• €38 million in other countries (€40 million in 2021).
4.b Other income – €17 million
“Other income” mainly includes the billing of costs for Enel
SpA personnel seconded to other Group companies (€12
million), and to Fondazione Centro Studi Enel and Enel
Cuore Onlus (€3 million).
In 2021, the item included the capital gain of €1,629 mil-
lion, on the sale of the 50% interest held in the joint ventu-
re Open Fiber SpA, to Macquarie Asset Management and
CDP Equity SpA.
94 Report and financial statements of Enel SpA at December 31, 2022
Costs
5.a Purchase of consumables
Costs for the purchase of consumables did not change si-
gnificantly on the previous year.
5.b Services, leases and rentals – €206 million
Costs for services, leases and rentals break down as
follows.
Millions of euro
2022 2021 Change
Services 202 192 10
Leases and rentals 4 5 (1)
Total services, leases and rentals 206 197 9
Costs for services include costs for services provided by
third parties in the amount of €73 million (€67 million in
2021) and by Group companies in the amount of €129 mil-
lion (€125 million in 2021).
Costs for services provided by Group companies rose by €3
million, essentially reflecting system services (€14 million),
partially offset by the decrease in costs for management
services (€16 million), while costs provided by third parties
increased by €7 million, largely attributable to an increase in
costs for professional and IT services costs.
Costs for leases and rentals mainly concern costs for lea-
sing assets from the subsidiary Enel Italia SpA.
5.c Personnel expenses – €105 million
Personnel expenses break down as follows.
Millions of euro
Notes 2022 2021 Change
Wages and salaries 81 76 5
Social security contributions 26 25 1
Post-employment benefits 25 6 6 -
Other long-term benefits 25 1 8 (7)
Share-based payments 5 4 1
Other costs and other incentive plans (14) 60 (74)
Total personnel expenses 105 179 (74)
“Personnel expenses” totaled €105 million, a decrease
of €74 million over 2021, mainly attributable to releases
to profit or loss in the amount of €21 million, due to the
adjustments to the related early termination incentive
plans adopted by the Company in 2021. Costs for early ter-
mination incentive plans in 2021 amounted to €57 million.
The cost of €5 million in respect of share-based payments
refers to the stock component of the 2019, 2020, 2021 and
2022 Long-Term Incentive Plans granted by the Company
to its employees.
The table below shows the average number of employe-
es by category, compared with the previous year, and the
actual number of employees at December 31, 2022.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
95Notes to the separate financial statements
No. Average number Headcount
2022 2021 Change at Dec. 31, 2022
Managers 154 148 6 164
Middle managers 449 417 32 481
Office staff 261 246 15 244
Total 864 811 53 889
5.d Depreciation, amortization and impairment losses – €1,330 million
Millions of euro
2022 2021 Change
Depreciation 4 5 (1)
Amortization 52 32 20
Impairment losses 1,437 788 649
Reversals of impairment losses 163 91 72
Total depreciation, amortization and impairment losses 1,330 734 596
Depreciation and amortization came to €56 million, and
include depreciation of €4 million and amortization of €52
million.
Impairment losses include impairment losses on the equity
investments held in the subsidiaries in Romania (€995 mil-
lion), Enel Green Power SpA (€228 million), Enel Innovation
Hubs Srl (€16 million) and Enel Investment Holding BV (€1
million).
The item also includes impairment losses of €195 million,
recognized on the interest held in the subsidiary PJSC
Enel Russia, following the agreements signed in June 2022
providing for the sale of the entire stake, equal to 56.43%
of the share capital of the latter, for a total of about €137
million, paid on the closing of the transaction in October
2022.
Reversals of impairment losses regarded the investments
in the subsidiaries Enel Global Trading SpA (€162 million)
and Enel Global Services Srl (€1 million).
In 2021, depreciation, amortization and impairment losses
totaled €734 million, and mainly regarded impairment los-
ses recognized on Romanian distribution subsidiaries (for a
total €270 million), the stake held in Enel Green Power SpA
(€497 million) and other interests in Italian and Dutch sub-
sidiaries (€21 million). The item also included reversals of
impairment losses regarding the investments in the subsi-
diaries Enel Global Trading SpA (€43 million), Enel Italia SpA
(€41 million) and Enel Innovation Hubs Srl (€7 million).
For details on the criteria used to determine the impair-
ment losses, see note 13 “Equity investments” below.
5.e Other operating costs – €27 million
Other operating costs increased by €13 million over 2021,
mainly reflecting the write-off of trade receivables (€8 mil-
lion) from PJSC Enel Russia.
96 Report and financial statements of Enel SpA at December 31, 2022
6. Income from equity investments – €8,770 million
Income from equity investments amounted to €8,770 mil-
lion and regards dividends and interim dividends approved
in 2022 by subsidiaries and associates in the amount of
€8,761 million and by joint ventures in the amount of €9
million.
The increase of €4,319 million on the previous year is
mainly attributable to the distribution by Enel Italia SpA of
available reserves (€6,000 million), partly offset by a decre-
ase in profits distributed by Enel Iberia SRLU, Enel Améric-
as SA and Enel Chile SA.
At the end of the year, outstanding interim dividends for
2022 included those approved by the subsidiaries Enel
Chile SA (€14 million), received in the first months of 2023,
and the joint venture Rusenergosbyt LLC (€9 million).
Millions of euro
2022 2021 Change
Dividends from subsidiaries and associates 8,761 4,409 4,352
Enel Américas SA 99 303 (204)
Enel Chile SA 28 168 (140)
Enel Energie Muntenia SA - 6 (6)
Enel Energie SA - 2 (2)
Enel Global Trading SpA - 86 (86)
Enel Iberia SRLU 648 1,175 (527)
Enel Italia SpA 7, 97 0 2,609 5,361
Enel Rinnovabili Srl - 25 (25)
E-Distribuţie Banat SA - 8 (8)
Enel Innovation Hubs Srl 16 - 16
E-Distribuţie Muntenia SA - 27 (27)
Dividends from joint ventures 9 41 (32)
Rusenergosbyt LLC 9 41 (32)
Dividends from other companies - 1 (1)
Empresa Propietaria de la Red SA - 1 (1)
Total income from equity investments 8,770 4,451 4,319
7. Net financial income/(expense) from derivatives – €171 million
This item breaks down as follows.
Millions of euro
2022 2021 Change
Income from derivatives:
- on behalf of Group companies: 1,796 786 1,010
- income from derivatives at fair value through profit or loss 1,796 786 1,010
- on behalf of Enel SpA: 335 287 48
- income from cash flow hedge derivatives 204 246 (42)
- income from derivatives at fair value through profit or loss 131 41 90
Total income from derivatives 2,131 1,073 1,058
Expense from derivatives:
- on behalf of Group companies: 1,791 785 1,006
- expense from derivatives at fair value through profit or loss 1,791 785 1,006
- on behalf of Enel SpA: 169 106 63
- expense from cash flow hedge derivatives 114 86 28
- expense from derivatives at fair value through profit or loss 55 20 35
Total expense from derivatives 1,960 891 1,069
TOTAL FINANCIAL INCOME/(EXPENSE) FROM DERIVATIVES 171 182 (11)
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
97Notes to the separate financial statements
Net financial income from derivatives amounted to €171
million (€182 million in 2021), a decrease of €11 million
mainly reflecting the combined effect of the increase in net
financial expense from cash flow hedge derivatives (€70
million), the increase in net financial income on derivatives at
fair value through profit or loss (€55 million) entered into on
behalf of Enel SpA, and the increase in net financial income
on derivatives entered into on behalf of Group companies
(€4 million).
For more details on derivatives, see note 32 “Financial in-
struments” and note 34 “Derivatives and hedge accounting”.
8. Net other financial income/(expense) – €(355) million
This item breaks down as follows.
Millions of euro
2022 2021 Change
Other financial income
Interest income
Interest income on non-current loan assets - 15 (15)
Interest income on current loan assets 183 27 156
Total 183 42 141
Exchange gains 45 1 44
Other 204 197 7
Total other financial income 432 240 192
Other financial expense
Interest expense
Interest expense on bank borrowings 88 51 37
Interest expense on bonds 297 365 (68)
Interest expense on other borrowings 309 203 106
Total 694 619 75
Exchange losses 90 179 (89)
Interest expense on defined benefit plans and other long-term employee
benefits
1 1 -
Financial expense on debt management transactions - 68 (68)
Other 2 2 -
Total other financial expense 787 869 (82)
NET OTHER FINANCIAL INCOME/(EXPENSE) (355) (629) 274
Other financial income amounted to €432 million, an in-
crease of €192 million compared with the previous year,
mainly reflecting:
• an increase of €156 million in interest income on short-
term financial assets, partly offset by a decrease of €15
million in interest income on long-term financial assets;
• an increase of €44 million in exchange gains.
Other financial expense amounted to €787 million, a de-
crease of €82 million over 2021 mainly reflecting:
• a decrease of €89 million in exchange losses;
• a decrease of €68 million in financial expense on debt
management transactions connected with the consent
solicitation undertaken by the Company in the previous
period;
• an increase of €106 million in interest expense received
from Enel Finance International NV, together with an
increase in interest expense on bank borrowings (€37
million) mainly reflecting the use of revolving credit lines
of the Company, partially offset by the decrease of €68
million in interest on bonds as a result of the Company’s
finance strategy to actively manage maturities and the
cost of borrowing.
98 Report and financial statements of Enel SpA at December 31, 2022
9. Income taxes – €(106) million
Millions of euro
2022 2021 Change
Current taxes (111) (107) (4)
Deferred tax income 9 (5) 14
Deferred tax expense (4) (2) (2)
Total taxes (106) (114) 8
Income taxes for 2022 showed a benefit of €106 million,
mainly as a result of the reduction in the tax base for the
corporate income tax (IRES) compared with pre-tax profit
due to the exclusion of 95% of the dividends received from
the subsidiaries and the deductibility of Enel SpA’s interest
expense for the Group in accordance with corporate in-
come tax law (Article 96 of the Consolidated Income Tax
Code).
The following table reconciles the theoretical tax rate with
the effective tax rate.
Millions of euro
2022 % rate 2021 % rate
Pre-tax profit 7,0 51 4,648
Theoretical corporate income taxes (IRES) 1,692 24.0% 1,116 24.0%
Tax decreases:
- dividends on equity investments, collected (2,072) -29.4% (1,015) -21.8%
- dividends on equity investments, not collected - - (4) -0.1%
- uses of provisions (16) -0.2% (13) -0.3%
- reversal of previous impairment losses (39) -0.6% - -
- other (30) -0.4% (48) -1.0%
- Open Fiber capital gain - - (371) -8.0%
Tax increases:
- impairment losses/(gains) for the year 305 4.3% 189 4.1%
- accruals to provisions 1 - 18 0.4%
- prior-year expense 46 0.7% 1 -
- other 9 0.1% 8 0.2%
Total current corporate income taxes (IRES) (104) -1.5% (119) -2.6%
IRAP - - - -
Foreign taxes 3 - 24 0.5%
Difference on estimated income taxes from prior years (10) -0.1% (12) -0.3%
Definitive withholdings on dividends from foreign investees - - - -
Total deferred tax items 5 0.1% (7) -0.2%
- of which impact of change in tax rate - -
- of which changes for the year 5 (7)
- of which difference of prior-year estimates - -
TOTAL INCOME TAXES (106) -1.5% (114) -2.5%
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
99Notes to the separate financial statements
Information on the statement of financial position
Assets
10. Property, plant and equipment – €11 million
Developments in property, plant and equipment for 2021
and 2022 are set out in the table below.
Millions of euro Land Buildings
Plant and
machinery
Industrial
and
commercial
equipment
Other
assets
Leasehold
improvements
Assets under
construction
and advances Total
Cost 1 5 3 5 27 41 1 83
Accumulated depreciation - (3) (3) (5) (23) (41) - (75)
Balance at Dec. 31, 2020 1 2 - - 4 - 1 8
Capital expenditure - 1 - - 6 - - 7
Entry into service - - - - - 1 (1) -
Depreciation - (1) - - (2) - - (3)
Total changes - - - - 4 - - 4
Cost 1 6 3 5 33 42 - 90
Accumulated depreciation - (4) (3) (5) (25) (41) - (78)
Balance at Dec. 31, 2021 1 2 - - 8 1 - 12
Capital expenditure - - - - 2 - - 2
Entry into service - - - - - - - -
Depreciation - (1) - - (2) - - (3)
Total changes - (1) - - - - - (1)
Cost 1 6 3 5 35 42 - 92
Accumulated depreciation - (5) (3) (5) (27) (41) - (81)
Balance at Dec. 31, 2022 1 1 - - 8 1 - 11
“Property, plant and equipment“ totaled €11 million, a de-
crease of €1 million compared with December 31, 2021,
reflecting the negative balance between depreciation re-
cognized (€3 million) and capital expenditure for 2022 (€2
million).
11. Intangible assets – €133 million
Intangible assets, all of which have a finite useful life, break
down as follows.
Millions of euro
Industrial patents and
intellectual property rights
Other intangible assets
under development Total
Balance at Dec. 31, 2020 54 59 113
Investments 42 20 62
Assets entering service 24 (24) -
Amortization (32) - (32)
Total changes 34 (4) 30
Balance at Dec. 31, 2021 88 55 143
Investments 4 38 42
Assets entering service 36 (36) -
Amortization (52) - (52)
Total changes (12) 2 (10)
Balance at Dec. 31, 2022 76 57 133
100 Report and financial statements of Enel SpA at December 31, 2022
“Industrial patents and intellectual property rights“, in the
amount of €76 million (€88 million at December 31, 2021),
mainly regard costs incurred in purchasing applications
software as well as related evolutionary maintenance.
Amortization is calculated on a straight-line basis over the
item’s residual useful life (three years on average). The in-
vestments of €4 million concerned information-techno-
logy projects related to digital development projects for
the computerization of business processes, compliance
and reporting of Holding Company functions, in particu-
lar in the areas of Administration, Finance and Control,
Legal and Corporate Affairs, Health and Safety, Commu-
nications, Innovability and Audit. “Other intangible assets
under development“ amounted to €57 million, an increase
of €2 million reflecting the net positive balance between
investments during the year and the value of assets ente-
ring service.
12. Deferred tax assets and liabilities – €146 million and €98 million
Changes in deferred tax assets and deferred tax liabilities,
grouped by type of timing difference, are shown below.
Millions of euro at Dec. 31, 2021
Increase/
(Decrease) taken
to profit or loss
Increase/
(Decrease) taken
to equity at Dec. 31, 2022
Deferred tax assets
Nature of temporary differences:
- provisions for risks and charges and impairment losses 3 1 - 4
- measurement of financial instruments 245 - (139) 106
- other items 51 (11) (4) 36
Total deferred tax assets 299 (10) (143) 146
Deferred tax liabilities
Nature of temporary differences:
- measurement of financial instruments (145) - 47 (98)
- other items (4) 4 - -
Total deferred tax liabilities (149) 4 47 (98)
Excess net deferred IRES tax assets after any offsetting 150 48
“Deferred tax assets“ totaled €146 million (€299 million at
December 31, 2021) and essentially regard deferred tax as-
sets on the fair value measurement of cash flow hedges.
“Deferred tax liabilities“ came to €98 million (€149 million at
December 31, 2021) and mainly regard deferred taxes on
the fair value measurement of cash flow hedge instruments.
The amount of deferred tax assets and liabilities was de-
termined by applying a rate of 24% for IRES.
13. Equity investments – €59,952 million
The table below shows the changes during the year for
each investment, with the corresponding carrying amoun-
ts at the beginning and end of the year, as well as the list of
investments held in subsidiaries, joint ventures, associates
and other companies.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
101Notes to the separate financial statements
Millions of euro
Original
cost
Impairment
(losses)/gains
Other changes -
IFRIC 11 & IFRS 2
Carrying
amount % holding
Capital
contributions
and loss
coverage
Acquisitions/
(Disposals)/
(Liquidations)/
(Repayments)
Mergers/Spin-
offs Reclassifications
Value
adjustments Net change Original cost
Impairment
(losses)/gains
Other changes
- IFRIC 11 &
IFRS 2
Carrying
amount % holding
at Dec. 31, 2021 Changes in 2022 at Dec. 31. 2022
A) Subsidiaries
Enel Global Services Srl 70 (1) - 69 100.0 - -
- - 1 1 70 - 1 71 100.0
Enel Global Thermal Generation Srl 57 (39) - 18 100.0 - - - - - - 57 (39) - 18 100.0
Enel Global Trading SpA 1,401 (162) 2 1,241 100.0 - - - - 162 162 1,401 - 2 1,403 100.0
Enel Green Power SpA 2,006 (497) 3 1,512 100.0 - - - - (228) (228) 2,006 (725) 4 1,285 100.0
Enel Grids Srl 59 - 1 60 100.0 - - - - - - 59 - 2 61 100.0
Enel Holding Finance Srl 7,875 - - 7,875 100.0 - - - - - - 7,875 - - 7,875 100.0
Enel Iberia SRLU 13,713 - - 13,713 100.0 - - - - - - 13,713 - 1 13,714 100.0
Enel Innovation Hubs Srl 70 (47) - 23 100.0 - - - - (16) (16) 70 (63) - 7 100.0
Enel Insurance NV 502 - - 502 100.0 - - - - - - 502 - - 502 100.0
Enel Investment Holding BV 4,497 (4,490) - 7 100.0 - - - - (1) (1) 4,497 (4,491) - 6 100.0
Enel Italia SpA 12,790 - 4 12,794 100.0 - - - - - - 12,790 - 5 12,795 100.0
Enel North America Inc. 3,155 - - 3,155 100.0 880 - - - - 880 4,035 - - 4,035 100.0
Enel Romania SA 15 - - 15 100.0 - - - (15) - (15) - - - - 100.0
Enel X Srl 270 - 2 272 100.0 - - (31) - - (31) 239 - 2 241 100.0
Enel X Way Srl - - - - - 800 58 31 - - 889 889 - - 889 100.0
Enelpower Srl 189 (163) - 26 100.0 - - - - - - 189 (163) - 26 100.0
Vektör Enerji Üretím AŞ - - - - 100.0 - - - - - - - - - - 100.0
Enel Américas SA 11,657 - - 11,657 82.3 1 - - - - 1 11,658 - - 11,658 82.3
E-Distribuţie Muntenia SA 952 (242) - 710 78.0 - - - (710) - (710) 242 (242) - - 78.0
Enel Energie Muntenia SA 330 - - 330 78.0 - - - (330) - (330) - - - - 78.0
Enel Chile SA 2,671 - - 2,671 64.9 - - - - - - 2,671 - - 2,671 64.9
PJSC Enel Russia 442 (110) - 332 56.4 - - - (332) - (332) 110 (110) - - -
E-Distribuţie Banat SA 421 (236) - 185 51.0 - - - (185) - (185) 236 (236) - - 51.0
E-Distribuţie Dobrogea SA 261 (60) - 201 51.0 - - - (201) - (201) 60 (60) - - 51.0
Enel Energie SA 208 - - 208 51.0 - - - (208) - (208) - - - - 51.0
Enel Finance International NV 2,624 - - 2,624 25.0 - - - - - - 2,624 - - 2,624 25.0
Enel Green Power Chile SA - - - - - - - - - - - - - - - -
Total subsidiaries 66,235 (6,047) 12 60,200 1,681 58 - (1,981) (82) (324) 65,993 (6,129) 17 59,881
B) Joint ventures
Rusenergosbyt LLC 41 - - 41 49.5 - - - - - - 41 - - 41 49.5
Total joint ventures 41 - - 41 - - - - - - 41 - - 41
C) Associates
CESI SpA 23 - - 23 42.7 - - - - - - 23 - - 23 42.7
Total associates 23 - - 23 - - - - - - 23 - - 23
D) Other companies
Compañía de Transmisión del Mercosur
SA
- - - - - - - - - - - - - - - -
Elcogas SA in liquidation 5 (5) - - 4.3 - - - - - - 5 (5) - - 4.3
Empresa Propietaria de la Red SA 5 - - 5 11.1 - - - - 2 2 5 2 - 7 11.1
Idrosicilia SpA - - - - 1.0 - - - - - - - - - - 1.0
Red Centroamericana de
Telecomunicaciones SA
- - - - 11.1 - - - - - - - - - - 11.1
Total other companies 10 (5) - 5 - - - - 2 2 10 (3) - 7
TOTAL EQUITY INVESTMENTS 66,309 (6,052) 12 60,269 1,681 58 - (1,981) (80) (322) 66,067 (6,132) 17 59,952
102 Report and financial statements of Enel SpA at December 31, 2022
Millions of euro
Original
cost
Impairment
(losses)/gains
Other changes -
IFRIC 11 & IFRS 2
Carrying
amount % holding
Capital
contributions
and loss
coverage
Acquisitions/
(Disposals)/
(Liquidations)/
(Repayments)
Mergers/Spin-
offs Reclassifications
Value
adjustments Net change Original cost
Impairment
(losses)/gains
Other changes
- IFRIC 11 &
IFRS 2
Carrying
amount % holding
at Dec. 31, 2021 Changes in 2022 at Dec. 31. 2022
A) Subsidiaries
Enel Global Services Srl 70 (1) - 69 100.0 - -
- - 1 1 70 - 1 71 100.0
Enel Global Thermal Generation Srl 57 (39) - 18 100.0 - - - - - - 57 (39) - 18 100.0
Enel Global Trading SpA 1,401 (162) 2 1,241 100.0 - - - - 162 162 1,401 - 2 1,403 100.0
Enel Green Power SpA 2,006 (497) 3 1,512 100.0 - - - - (228) (228) 2,006 (725) 4 1,285 100.0
Enel Grids Srl 59 - 1 60 100.0 - - - - - - 59 - 2 61 100.0
Enel Holding Finance Srl 7,875 - - 7,875 100.0 - - - - - - 7,875 - - 7,875 100.0
Enel Iberia SRLU 13,713 - - 13,713 100.0 - - - - - - 13,713 - 1 13,714 100.0
Enel Innovation Hubs Srl 70 (47) - 23 100.0 - - - - (16) (16) 70 (63) - 7 100.0
Enel Insurance NV 502 - - 502 100.0 - - - - - - 502 - - 502 100.0
Enel Investment Holding BV 4,497 (4,490) - 7 100.0 - - - - (1) (1) 4,497 (4,491) - 6 100.0
Enel Italia SpA 12,790 - 4 12,794 100.0 - - - - - - 12,790 - 5 12,795 100.0
Enel North America Inc. 3,155 - - 3,155 100.0 880 - - - - 880 4,035 - - 4,035 100.0
Enel Romania SA 15 - - 15 100.0 - - - (15) - (15) - - - - 100.0
Enel X Srl 270 - 2 272 100.0 - - (31) - - (31) 239 - 2 241 100.0
Enel X Way Srl - - - - - 800 58 31 - - 889 889 - - 889 100.0
Enelpower Srl 189 (163) - 26 100.0 - - - - - - 189 (163) - 26 100.0
Vektör Enerji Üretím AŞ - - - - 100.0 - - - - - - - - - - 100.0
Enel Américas SA 11,657 - - 11,657 82.3 1 - - - - 1 11,658 - - 11,658 82.3
E-Distribuţie Muntenia SA 952 (242) - 710 78.0 - - - (710) - (710) 242 (242) - - 78.0
Enel Energie Muntenia SA 330 - - 330 78.0 - - - (330) - (330) - - - - 78.0
Enel Chile SA 2,671 - - 2,671 64.9 - - - - - - 2,671 - - 2,671 64.9
PJSC Enel Russia 442 (110) - 332 56.4 - - - (332) - (332) 110 (110) - - -
E-Distribuţie Banat SA 421 (236) - 185 51.0 - - - (185) - (185) 236 (236) - - 51.0
E-Distribuţie Dobrogea SA 261 (60) - 201 51.0 - - - (201) - (201) 60 (60) - - 51.0
Enel Energie SA 208 - - 208 51.0 - - - (208) - (208) - - - - 51.0
Enel Finance International NV 2,624 - - 2,624 25.0 - - - - - - 2,624 - - 2,624 25.0
Enel Green Power Chile SA - - - - - - - - - - - - - - - -
Total subsidiaries 66,235 (6,047) 12 60,200 1,681 58 - (1,981) (82) (324) 65,993 (6,129) 17 59,881
B) Joint ventures
Rusenergosbyt LLC 41 - - 41 49.5 - - - - - - 41 - - 41 49.5
Total joint ventures 41 - - 41 - - - - - - 41 - - 41
C) Associates
CESI SpA 23 - - 23 42.7 - - - - - - 23 - - 23 42.7
Total associates 23 - - 23 - - - - - - 23 - - 23
D) Other companies
Compañía de Transmisión del Mercosur
SA
- - - - - - - - - - - - - - - -
Elcogas SA in liquidation 5 (5) - - 4.3 - - - - - - 5 (5) - - 4.3
Empresa Propietaria de la Red SA 5 - - 5 11.1 - - - - 2 2 5 2 - 7 11.1
Idrosicilia SpA - - - - 1.0 - - - - - - - - - - 1.0
Red Centroamericana de
Telecomunicaciones SA
- - - - 11.1 - - - - - - - - - - 11.1
Total other companies 10 (5) - 5 - - - - 2 2 10 (3) - 7
TOTAL EQUITY INVESTMENTS 66,309 (6,052) 12 60,269 1,681 58 - (1,981) (80) (322) 66,067 (6,132) 17 59,952
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
103Notes to the separate financial statements
The table below reports changes in equity investments in
2022.
Millions of euro
Increases
Capital contribution to Enel North America Inc. 880
Acquisition of Enel X Way Srl 58
Capital contribution to Enel X Way Srl 800
Partial demerger of Enel X Srl to Enel X Way Srl 31
Enel Américas SA - Conversion ADR 1
Revaluation of investment held in Empresa Propietaria de la Red SA 2
Reversal of impairment loss on Enel Global Trading SpA 162
Reversal of impairment loss on Enel Global Services Srl 1
Total increases 1,935
Decreases
Partial demerger of Enel X Srl to Enel X Way Srl (31)
Reclassification of PJSC Enel Russia as “Non-current assets classified as held for sale” (332)
Reclassification of E- Distribuţie Banat SA as “Non-current assets classified as held for sale” (185)
Reclassification of E- Distribuţie Dobrogea SA as “Non-current assets classified as held for sale” (201)
Reclassification of Enel Energie SA as “Non-current assets classified as held for sale” (208)
Reclassification of E-Distribuţie Muntenia SA as “Non-current assets classified as held for sale” (710)
Reclassification of Enel Energie Muntenia SA as “Non-current assets classified as held for sale” (330)
Reclassification of Enel Romania SA as “Non-current assets classified as held for sale” (15)
Impairment loss on the investment in Enel Green Power SpA (228)
Impairment loss on the investment in Enel Innovation Hubs Srl (16)
Impairment loss on the investment in Enel Investment Holding BV (1)
Total decreases (2,257)
NET CHANGE (322)
In 2022 the carrying amount of investments in subsidiaries,
joint ventures, associates and other companies decreased
by €322 million as a result of:
• the capital contributions, on February 15, 2022 and Mar-
ch 14, 2022, to the subsidiary Enel North America Inc. in
the amount of €880 million to support the business re-
quirements of the subsidiaries;
• the incorporation, following the partial demerger of Enel
X Srl on April 1, 2022, of Enel X Way Srl (formerly Enel X
Charge Srl), with the aim (among others) of setting up a
holding company for the development of electric mobi-
lity and MSP (Mobility Service Provider) of the Enel Group.
The value of the demerged assets is €31 million;
• the acquisition on April 5, 2022 of an interest in Enel X
Way Srl by Enel X Italia Srl, in the amount of €58 million;
• the capital contribution of €800 million, on April 19,
2022, to Enel X Way Srl in order to provide the company
with the necessary financial resources to carry out the
activities described above;
• the reclassification as “Non-current assets held for sale”
of the interest held in the subsidiary PJSC Enel Russia, re-
cognized at a value of €332 million, following the agree-
ments signed at the end of June 2022 on the sale by Enel
of the entire stake held in Enel Russia SpA to PJSC Lukoil
and the Closed Combined Mutual Investment Fund
“Gazprombank-Frezia”. The sale was finalized in October
for a total of about €137 million. The transaction was clo-
sed following the fulfillment of all the conditions set out
in the two separate contracts entered into with them,
including approval of the transaction by the President of
the Russian Federation in accordance with paragraph 5
of Decree 520 of August 5, 2022;
• the reclassification as “Non-current assets held for sale”
of the interests held in Romanian subsidiaries for a total
amount of €1,649 million, as a result of the negotiations
started for the sale of all the equity investments held by
the Group in Romania;
• the increase in the fair value measurement of the equity
investment in Empresa Propietaria de la Red SA in the
amount of €2 million;
• the reversal in the amount of €162 million of the impair-
ment loss recognized on the investment in Enel Global
104 Report and financial statements of Enel SpA at December 31, 2022
Trading SpA to take account of the assumptions in the
new business plan and market developments due to gas
prices;
• the reversal in the amount of €1 million of the impair-
ment loss recognized on the investment in Enel Global
Services Srl;
• the impairment loss on the investment in Enel Green
Power SpA, in the amount of €228 million, mainly due to
the disposal of assets in Romania;
• the impairment loss on the investment in the subsidiary
Enel Innovation Hubs Srl in the amount of €16 million, to
take account of the performance and financial position
of the company;
• the reversal in the amount of €1 million of the impair-
ment loss recognized on the investment in Enel Invest-
ment Holding BV to take account of the performance
and financial position of the company.
In accordance with IFRS 2, the carrying amount of invest-
ments in the subsidiaries involved in the Long-Term Incen-
tive Plan for 2019, 2020, 2021 and 2022 has also been in-
creased by the fair value of the equity component for the
year, recognized in specific equity reserves, in the overall
amount of €6 million. In the case of the award of equity
instruments to the employees of indirect subsidiaries, the
carrying amount of the equity investment in the direct
subsidiary was increased.
The following table shows the assumptions used in deter-
mining the impairment loss on the investments held in Enel
Green Power SpA, and the reversal of the impairment loss
recognized on the investments in Enel Global Trading SpA
and Enel Global Services Srl.
Millions of euro
Original
cost
Growth
rate
(1)
Pre-tax
WACC
discount
rate
(2)
Explicit
period
of cash
flows
Terminal
value
(3)
Original
cost
Growth
rate
(1)
Pre-tax
WACC
discount
rate
(2)
Explicit
period
of cash
flows
Terminal
value
(3)
at Dec. 31, 2022 at Dec. 31, 2021
Enel Green Power SpA 1,513 2.5% 8.4% 3 years
Annuity/26
years
2,008 1.7% 7.6 % 3 years
Annuity/24
years
Enel Global Trading SpA 1,241 1.6% 8.6% 3 years Perpetuity 1,198 1.7% 6.3% 3 years Perpetuity
Enel Global Services Srl 70 1.6% 5.9% 3 years Perpetuity 69 1.7% 4.2% 3 years Perpetuity
(1) Perpetual growth rate for cash flows after the explicit forecast period.
(2) Pre-tax WACC calculated using the iterative method: the discount rate that ensures that the value in use calculated with pre-tax cash flows is equal to that
calculated with post-tax cash flows discounted with the post-tax WACC.
(3) The terminal value has been estimated on the basis of a perpetuity or an annuity with a rising yield for the years indicated in the column.
The recoverable amount of the equity investments recogni-
zed through the impairment tests was estimated by calcula-
ting the equity value of the investments through an estima-
te of their value in use using discounted cash flow models,
which involve estimating expected future cash flows and
applying an appropriate discount rate, selected on the basis
of market inputs such as risk-free rates, betas and market
risk premiums. For the purpose of comparing the carrying
amount of the investments, the enterprise value resulting
from the estimation of future cash flows was converted into
the equity value by subtracting the net financial position of
the investee. Cash flows were determined on the basis of
the best information available at the time of the estimate
and drawn for the explicit period from the 2023-2025 Busi-
ness Plan approved by the Board of Directors of the Com-
pany on November 22, 2022, containing forecasts for vo-
lumes, revenue, operating costs, capital expenditure, indu-
strial and commercial organization and developments in the
main macroeconomic variables (inflation, nominal interest
rates and exchange rates) and commodity prices. The expli-
cit period of cash flows considered in impairment testing
for these equity investments differs in accordance with the
specific features and business cycles of the various compa-
nies. The terminal value, on the other hand, was calculated
as a perpetuity or annuity with a nominal growth rate equal
to the long-term rate of growth in electricity demand and/
or inflation (depending on the country and business invol-
ved) and in any case no higher than the average long-term
growth rate of the reference market.
With regard to the investments held in the companies Enel
Italia SpA, Enel X Way Srl, Enel North America Inc., Enel Glo-
bal Thermal Generation Srl, Enel X Srl, the carrying amount
is deemed to be recoverable even if individually greater than
equity at December 31, 2022, for each investee. This circu-
mstance is not felt to represent an impairment loss in re-
spect of the investment but rather a temporary mismatch
between the two amounts. More specifically, for the com-
panies Enel Italia SpA, Enel X Way Srl, Enel North America
Inc., Enel Global Thermal Generation Srl and Enel X Srl, the
negative difference between the carrying amount of the
investments and their equity represented a trigger event,
following which the equity value of the investments in con-
sideration of their expected future cash flows was determi-
ned by means of an impairment test. As a result of this test,
a greater value emerged that was not reflected in equity to
an extent necessary to confirm the full recoverability of the
value of the investments.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
105Notes to the separate financial statements
It should also be noted that these investments have passed
their related impairment tests.
The share certificates for Enel SpA’s investments in Italian
subsidiaries are held in custody at Monte dei Paschi di Siena.
The following table reports the share capital and equity of
the investments in subsidiaries, joint ventures, associates
and other investees at December 31, 2022.
Registered office Currency Share capital
Equity
(millions of
euro)
Prior year
profit/(loss)
(millions of
euro) % holding
Carrying
amount
(millions of
euro)
A) Subsidiaries
Enel Global Services Srl Rome EUR 10,000 51 14 100.0 71
Enel Global Thermal
Generation Srl
Rome EUR 11,000,000 6 (13) 100.0 18
Enel Global Trading SpA Rome EUR 90,885,000 380 (12) 100.0 1,403
Enel Green Power SpA Rome EUR 272,000,000 482 (114) 100.0 1,285
Enel Grids Srl Rome EUR 10,100,000 319 292 100.0 61
Enel Holding Finance Srl Rome EUR 10,000 7,874 - 100.0 7, 875
Enel Iberia SRLU Madrid EUR 336,142,500 23,435 725 100.0 13,714
Enel Innovation Hubs Srl Rome EUR 1,100,000 7 - 100.0 7
Enel Insurance NV Amsterdam EUR 60,000 511 5 100.0 502
Enel Investment Holding BV Amsterdam EUR 1,000,000 5 (1) 100.0 6
Enel Italia SpA Rome EUR 100,000,000 3,745 910 100.0 12,795
Enel North America Inc. Andover USD 50 5,761 191 100.0 4,035
Enel Romania SA Buftea RON 200,000 5 1 100.0 -
Enel X Srl Rome EUR 1,050,000 193 54 100.0 241
Enel X Way Srl Rome EUR 6,026,000 818 (15) 100.0 889
Enelpower Srl Milan EUR 2,000,000 26 1 100.0 26
Vektör Enerji Üretím AŞ Istanbul TRY 3,500,000 - - 100.0 -
Enel Américas SA Santiago USD 15,799,498,545 14,474 288 82.3 11,658
E-Distribuţie Muntenia SA Bucharest RON 271,635,250 580 (37) 78.0 -
Enel Energie Muntenia SA Bucharest RON 37,004,350 29 (67) 78.0 -
Enel Chile SA Santiago CLP 3,882,103,470,184 4,827 1,426 64.9 2,671
E-Distribuţie Banat SA Timisoara RON 382,158,580 243 (59) 51.0 -
E-Distribuţie Dobrogea SA Costanta RON 280,285,560 198 (32) 51.0 -
Enel Energie SA Bucharest RON 140,000,000 24 (79) 51.0 -
Enel Finance International NV Amsterdam EUR 1,478,810,371 10,286 44 25.0 2,624
Enel Green Power Chile SA Santiago USD 842,121,531 1,228 30 - -
B) Joint ventures
Rusenersgobyt LLC Moscow RUB 18,000,000 159 158 49.5 41
C) Associates
CESI SpA
(1)
Milan EUR 8,550,000 105 (10) 42.7 23
D) Other companies
Compañía de Transmisión del
Mercosur SA
Buenos Aires ARS 2,025,191,313 - - - -
Elcogas SA in liquidation Puertollano EUR 809,690 - - 4.3 -
Empresa Propietaria de la
Red SA
Panama USD 58,500,000 156 18 11.1 7
Idrosicilia SpA Milan EUR 22,520,000 - - 1.0 -
Red Centroamericana de
Telecomunicaciones SA
Panama USD 2,700,000 (10) (2) 11.1 -
(1) The value of share capital, equity and profit/(loss) for the year refers to the financial statements at December 31, 2021.
Equity investments in other companies at December 31,
2022 are all related to unlisted companies. During the tran-
sition to IFRS 9, the option of measuring these financial
assets at fair value through other comprehensive income
was applied.
The investment in Elcogas SA was completely written off in
2014 and since January 1, 2015 the company, in which Enel
has a stake of 4.3%, is in liquidation. The profit participation
loan of €6 million granted in 2014 has also been written
down to take account of accumulated losses.
106 Report and financial statements of Enel SpA at December 31, 2022
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021
Equity investments in unlisted companies measured at FVOCI 7 5
Empresa Propietaria de la Red SA 7 5
Red Centroamericana de Telecomunicaciones SA - -
Compañía de Transmisión del Mercosur SA - -
Elcogas SA in liquidation - -
Idrosicilia SpA - -
14. Derivatives – €349 million, €390 million, €663 million, €178 million
Millions of euro Non-current Current
at Dec. 31, 2022 at Dec. 31, 2021 at Dec. 31, 2022 at Dec. 31, 2021
Derivative financial assets 349 753 390 60
Derivative financial liabilities 663 1,300 178 131
For more details about the nature, recognition and classi-
fication of derivative financial assets and liabilities, please
see notes 32 “Financial instruments” and 34 “Derivatives
and hedge accounting”.
15. Other non-current financial assets – €14 million
This item breaks down as follows:
Millions of euro
Notes at Dec. 31, 2022 at Dec. 31, 2021 Change
Financial prepayments 10 13 (3)
Other non-current financial assets included in debt 15.1 4 3 1
Total 14 16 (2)
“Financial prepayments“ essentially refers to the remaining
portion of the transaction costs on the €10 billion revolving
credit line, established on December 18, 2017, and with a
five-year term, between Enel SpA, Enel Finance Internatio-
nal NV, and Mediobanca. The item reports the non-current
portion of those costs, and their reversal through profit or
loss depends on the type of fee involved and the maturity
of the credit line.
15.1 Other non-current financial assets
included in debt – €4 million
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Other loan assets 4 3 1
Total 4 3 1
“Other loan assets“, equal to €4 million, are entirely ac-
counted for by loans to employees.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
107Notes to the separate financial statements
16. Other non-current assets – €81 million
This item breaks down as follows.
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Tax assets 12 12 -
Amounts due from subsidiaries for assumption of supplementary pension
plan liabilities
69 87 (18)
Total other non-current assets 81 99 (18)
“Tax assets“ include the residual amount of €9 million due
in respect of the claim for reimbursement for excess in-
come tax paid as a result of not partially deducting IRAP
in calculating taxable income for IRES purposes. These
claims were submitted by Enel SpA on its own behalf for
2003 and on its own behalf and as the consolidating com-
pany for 2004-2011.
Tax assets also include the asset of €3 million arising from
the definitive calculation of the withholding tax levied on
the dividends of Enel Américas SA pertaining to 2021.
Amounts due from subsidiaries for assumption of sup-
plementary pension plan liabilities refer to amounts due in
respect of the assumption by Group companies of their
share of the supplementary pension plan. The terms of the
agreement state that the Group companies concerned
are to reimburse the costs of extinguishing defined benefit
obligations of the Parent, which are recognized under em-
ployee benefits.
On the basis of actuarial forecasts made using current
assumptions, the portion due beyond five years of these
amounts due from subsidiaries for assumption of supple-
mentary pension plan liabilities came to €11 million (€25
million at December 31, 2021).
17. Trade receivables – €294 million
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Trade receivables:
- due from subsidiaries 278 260 18
- due from third-party customers 16 15 1
Total 294 275 19
Trade receivables due from subsidiaries primarily regard
the management and coordination services and other
activities performed by Enel SpA on behalf of Group com-
panies. Trade receivables due from third-party customers
concern services of various types.
Trade receivables due from subsidiaries break down as
follows.
108 Report and financial statements of Enel SpA at December 31, 2022
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Subsidiaries
Edistribución Redes Digitales SLU 8 7 1
e-distribuzione SpA 16 22 (6)
Endesa Energía SA 2 3 (1)
Endesa Generación SA 4 2 2
Endesa SA 13 10 3
Enel Américas SA 6 5 1
Enel Brasil SA 93 70 23
Enel Chile SA 9 7 2
Enel Distribución Chile SA 5 5 -
Enel Distribución Perú SAA 3 3 -
Enel Energia SpA 7 9 (2)
Enel Generación Chile SA 5 4 1
Enel Generación Perú SAA 2 2 -
Enel Global Services Srl 12 12 -
Enel Green Power Chile SA 3 1 2
Enel Green Power Hellas SA 3 2 1
Enel Green Power Italia Srl 2 4 (2)
Enel Green Power North America Inc. 10 5 5
Enel Green Power SpA 3 3 -
Enel Grids Srl 1 4 (3)
Enel Italia SpA (1) - (1)
Enel North America Inc. 3 7 (4)
Enel Produzione SpA 4 4 -
Enel Romania Srl 5 5 -
PJSC Enel Russia - 9 (9)
Enel X Srl 3 5 (2)
Enel X Way Srl 4 - 4
E-Distribuţie Banat SA 6 6 -
E-Distribuţie Dobrogea SA 3 3 -
E-Distribuţie Muntenia SA 10 9 1
Gas y Electricidad Generación SAU 1 2 (1)
Servizio Elettrico Nazionale SpA 1 2 (1)
Vektör Enerjí Üretím AŞ 8 8 -
Other 24 20 4
Total 278 260 18
Trade receivables by geographical segment are shown
below.
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Italy 56 70 (14)
EU 79 70 9
Non-EU Europe 2 10 (8)
Other 157 125 32
Total 294 275 19
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
109Notes to the separate financial statements
18. Income tax assets – €165 million
Income tax assets at December 31, 2022 amounted to
€165 million and essentially regard the Company’s IRES
credit for estimated current taxes for 2022 (€142 million)
and the receivable for withholding tax on dividends of Enel
Américas SA and Enel Chile SA (€16 million).
19. Other current financial assets – €3,480 million
Millions of euro
Notes at Dec. 31, 2022 at Dec. 31, 2021 Change
Other current financial assets included in debt 19.1 3,395 8,197 (4,802)
Other sundry current financial assets 85 60 25
Total 3,480 8,257 (4,777)
For more information on “Other current financial assets
included in debt”, please see note 19.1.
“Other current financial assets” essentially refer to re-
ceivables in respect of Group companies for interest
and other fees deriving from financial services contracts
amounting to €11 million (€15 million at December 31,
2021), financial assets in respect of the outcome of de-
rivative positions amounting to €20 million (€3 million at
December 31, 2021), current accrued financial income of
€40 million (€37 million at December 31, 2021) and cur-
rent financial prepaid expense of €14 million (€5 million at
December 31, 2021).
19.1 Other current financial assets included
in debt – €3,395 million
Millions of euro
Notes at Dec. 31, 2022 at Dec. 31, 2021 Change
Loan assets due from Group companies: 3,001 7,111 (4,110)
- short-term loan assets (intercompany current accounts) 32.1.1 2,489 7,111 (4,622)
- short-term financing 512 - 512
Loan assets due from others: 394 1,086 (692)
- other loan assets 5 9 (4)
- cash collateral for margin agreements on OTC derivatives 32.1.1 389 1,077 (688)
Total 3,395 8,197 (4,802)
20. Other current assets – €584 million
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Tax assets 286 4 282
Other amounts due from Group companies 283 1,044 (761)
Other amounts due 15 15 -
Total 584 1,063 (479)
“Tax assets” amounted to €286 million and include €274
million in respect of the residual VAT credit for 2022 of the
Enel VAT Group.
The change on the previous year is essentially due to the
non-payment of the VAT payment on account in 2021, in
line with the clarifications issued by the Revenue Agency,
which ruled that, in the first year of establishment of the
single VAT payer, the payment on account is not due given
the absence of information on which to calculate the pay-
ment itself.
The item also includes the tax asset of €8 million in respect
of the IRES reimbursement for 2011-2014 paid to Enel SpA
following an agreement procedure (MAP) begun in 2021
and completed in 2022 with an agreement between the
110 Report and financial statements of Enel SpA at December 31, 2022
Italian and Spanish tax authorities eliminating the dou-
ble taxation charged to the multinational group following
adjustments made to transfer prices applied in tran-
sactions between Enel SpA and its Spanish subsidiaries in
2011, 2012, 2013 and 2014.
Other amounts due from Group companies essentially re-
gard receivables for the interim dividend approved in 2022
by the subsidiaries Rusenersgobyt LLC and Enel Chile SA
(€12 million and €14 million, respectively), IRES assets in re-
spect of the Group companies participating in the consoli-
dated taxation mechanism (€154 million) and VAT assets in
respect of companies participating in the Group VAT me-
chanism (€101 million).
In 2021, the item included the VAT credits in respect of the
subsidiaries participating in the Enel VAT Group (€547 mil-
lion) and assets for the interim dividend approved in 2021
by Enel Iberia SRLU, Enel Américas SA and Enel Chile tota-
ling €368 million, which were received in early 2022.
Other amounts due, equal to €15 million at December 31,
2022, are substantially in line with the 2021 values.
21. Cash and cash equivalents – €4,868 million
Cash and cash equivalents break down as follows.
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Bank and post office deposits 4,868 952 3,916
Cash and cash equivalents on hand - - -
Total 4,868 952 3,916
Cash and cash equivalents amounted to €4,868 million,
an increase of €3,916 million on December 31, 2021,
reflecting cash flows generated by ordinary operations.
Cash flows from operating activities in 2022 were a posi-
tive €8,689 million (€6,757 million at December 31, 2021),
an increase of €1,932 million compared with 2021, mainly
reflecting an increase in dividends received, partly offset
by an increase in financial expense paid and greater cash
requirements connected with the change in net working
capital.
During the year, financing activities absorbed cash flows of
€3,126 million. This mainly reflected repayments in the pe-
riod on long-term borrowings (€10,466 million), payment of
dividends (€3,882 million) partly offset by the issue of new
long-term borrowings (€4,251 million), the net reduction in
financial debt (€7,108 million) and the payment of coupons
to holders of hybrid perpetual bonds (€123 million).
Investing activities absorbed cash flows of €1,647 million,
mainly reflecting the capital contributions to the subsidiary
Enel North America Inc. (€880 million), the acquisition by
Enel X Italia Srl of an interest in Enel X Way Srl and the reca-
pitalization of the latter (€858 million), partly offset by the
liquidity generated by the sale of Enel Russia (€137 million).
The cash requirements of investing and financing activities
were primarily funded by the contribution of the cash flows
generated by operating activities, which were a positive
€8,689 million, determining a closing balance of cash and
cash equivalents at year end of €4,868 million.
22. Non-current assets classified as held for sale - €654 million
Non-current assets reclassified as held for sale include the
equity investments in E-Distribuţie Muntenia SA, E-Distri-
buţie Banat SA, E-Distribuţie Dobrogea SA, Enel Energie
SA, Enel Energie Muntenia SA and Enel Romania SA, for a
total €654 million, following the agreement on the sale to
the Greek company Public Power Corporation SA (PPC) of
all the equity stakes held by the Enel Group in Romania.
The reclassified value reflects a value adjustment of €995
million made to align the value of the equity investments
with the consideration in the sale agreement.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
111Notes to the separate financial statements
Liabilities and equity
23. Equity – €38,342 million
Equity amounted to €38,342 million, an increase of
€3,375 million compared with December 31, 2021.
The change is mainly attributable to:
• profit for the year (€7,464 million);
• the distribution of the balance of the dividend for 2021
in the amount of €0.19 per share (for a total of €1,932
million), as approved by the Shareholders’ Meeting on
May 19, 2022, and the interim dividend for 2022 appro-
ved by the Board of Directors on November 3, 2022 and
paid as from January 25, 2023 (€0.20 per share for a
total of €2,033 million).
Share capital – €10,167 million
At December 31, 2022, the fully subscribed and paid-up
share capital of Enel SpA totaled €10,166,679,946, repre-
sented by the same number of ordinary shares with a par
value of €1.00 each.
The share capital is unchanged compared with the
amount reported at December 31, 2021.
At December 31, 2022, based on the shareholders regi-
ster and the notices submitted to CONSOB and received
by the Company pursuant to Article 120 of Legislative De-
cree 58 of February 24, 1998, as well as other available
information, shareholders with interests of greater than
3% in the Company’s share capital were the Ministry for
the Economy and Finance (with a 23.585% stake) and
BlackRock Inc. (with a 5.114% stake held for asset mana-
gement purposes).
Negative treasury share reserve – €(47)
million
At December 31, 2022, treasury shares are represented
by 7,153,795 ordinary shares of Enel SpA with a par value
of €1.00 each (4,889,152 at December 31, 2021), purcha-
sed through a qualified intermediary for a total amount of
about €47 million.
On June 16, 2022, the Board of Directors of the Company,
implementing the authorization granted by the Sharehol-
ders’ Meeting held on May 19, 2022, approved the launch
of a share buyback program for 2.7 million, equivalent to
about 0.027% of Enel’s share capital.
The program, which began on June 17, 2022 and was
completed on July 20, was introduced to serve the 2022
Long-Term Incentive Plan for the management of Enel
and/or of its subsidiaries pursuant to Article 2359 of the
Italian Civil Code (2022 LTI Plan) which was also approved
by Enel’s Shareholders’ Meeting of May 19, 2022.
As a result of these transactions, a total of 2,700,000 Enel
shares (equal to 0.026557% of share capital), were acqui-
red at a volume-weighted average price of €5.1951 per
share for a total €14,026,715. Moreover, on September 5,
2022, Enel awarded 435,357 shares to the beneficiaries
of the 2019 LTI Plan.
As a result of the award and considering the treasury
shares already owned, at December 31, 2022 Enel held
7,153,795 treasury shares, equal to 0.070365% of share
capital, serving the Long-Term Incentive Plans (the LTI
Plans for 2019, 2020, 2021 and 2022).
In accordance with Article 2357-ter, paragraph 2, of the
Civil Code, treasury shares do not participate in the distri-
bution of the dividend.
Perpetual hybrid bonds – €5,567 million
The item regards the non-convertible subordinated per-
petual hybrid bonds denominated in euros intended for
institutional investors.
The item has not changed compared to the previous year.
During 2022, the Company paid coupons to holders of
perpetual hybrid bonds for €123 million.
Other reserves – €11,835 million
Share premium reserve – €7,496 million
The share premium reserve at December 31, 2022 was
equal to €7,496 million, unchanged compared with the
previous year.
Legal reserve – €2,034 million
The legal reserve, equal to 20.0% of share capital, is un-
changed compared with the previous year.
Reserve pursuant to Law 292/1993 – €2,215 million
The reserve shows the remaining portion of the adjust-
ments carried out when Enel was transformed from a pu-
blic entity to a joint-stock company.
In the case of a distribution of this reserve, the tax treat-
ment for capital reserves as defined by Article 47 of the
Consolidated Income Tax Code shall apply.
Other reserves – €137 million
Other reserves include €19 million related to the reserve
for capital grants, which reflects 50% of the grants recei-
ved from Italian public entities and EU bodies in applica-
tion of related laws for new works (pursuant to Article 55
of Presidential Decree 917/1986), which is recognized in
equity in order to take advantage of tax deferment be-
nefits.
The item also includes the unavailable reserve establi-
shed for the purchase of treasury shares in the amount
of €47 million in execution of the resolutions of the Ordi-
112 Report and financial statements of Enel SpA at December 31, 2022
nary Shareholders’ Meeting of Enel SpA and the reserves
established to recognize the value of the equity compo-
nent granted to the management of the Company and
the subsidiaries as part of the 2019, 2020, 2021 and 2022
Long-Term Incentive Plans in the amount of €22 million.
For further details, please see note 36 “Share-based pay-
ments”.
It also includes €29 million in respect of the stock option
reserve and €20 million for other reserves.
Hedging reserves – €(27) million
At December 31, 2022, the item includes the hedging
reserve and the hedging costs reserve, amounting to a
negative €27 million (net of the positive tax effect of €9
million).
Reserve from measurement of financial assets at
FVOCI - €2 million
At December 31, 2022, the valuation reserve for financial
assets at FVOCI came to €2 million, reflecting the fair vale
measurement of Empresa Propietaria de la Red SA.
Actuarial reserve – €(22) million
At December 31, 2022, the actuarial reserve amounted
to €22 million (net of the positive tax effect of €4 mil-
lion). The reserve includes actuarial gains and losses re-
cognized directly in equity, as the corridor approach is no
longer permitted under the new version of “IAS 19 - Em-
ployee Benefits”.
The table below provides a breakdown of changes in the
hedging and actuarial reserves in 2021 and 2022.
Millions of euro
Gross gains/
(losses)
recognized
in equity
during the
year
Gross
released
to profit or
loss Taxes Other changes
Gross gains/
(losses)
recognized
in equity
during the
year
Gross
released
to profit or
loss Taxes Other changes
At Jan. 1,
2021
at Dec. 31,
2021
at Dec. 31,
2022
Hedging reserve (443) 347 (169) (39) (14) (318) 464 (54) (93) (23) (24)
Hedging costs
reserve
(16) 21 - (5) - - (4) - 1 - (3)
Reserve from
measurement of
financial assets
at FVOCI
- - - - - - 2 - - - 2
Actuarial reserve (39) 6 - (2) - (35) 17 - (4) - (22)
Gains/(Losses)
recognized
directly in
equity
(498) 374 (169) (46) (14) (353) 479 (54) (96) (23) (47)
Retained earnings – €5,696 million
For 2022, the item shows an increase of €768 million,
reflecting:
• the allocation of profit for the year 2021, in execution of
the resolutions of the Shareholders’ Meeting of May 19,
2022, in the amount of €71 million, covering the amoun-
ts paid in 2021 as coupons to the holders of perpetual
hybrid bonds and the remainder of profit for a total of
€831 million, including the portion of the undistributed
dividend balance in respect of treasury shares held in
the portfolio at the record date of July 19, 2022;
• the payment of coupons in the total amount of €123 mil-
lion to the holders of perpetual hybrid bonds;
• the unavailable reserve established for the purchase of
treasury shares serving the 2022 LTI Plan, for a total €14
million;
• the reclassification of a specific unavailable reserve of
about €3 million as a result of the partial award of the
treasury shares serving the 2019 LTI Plan following achie-
vement of the Plan’s performance objectives.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
113Notes to the separate financial statements
Profit for the year – €5,124 million
Profit for 2022, net of the interim dividend for 2022 of
€0.20 per share (for a total €2,033 million), amounted to
€5,124 million.
The table below shows the availability of reserves for di-
stribution.
Millions of euro
at Dec. 31, 2022 Possible uses Amount available
Share capital 10,167
Capital reserves:
- share premium reserve 7,49 6 ABC 7,49 6
- equity instruments - perpetual hybrid bonds 5,567
Income reserves:
- legal reserve 2,034 B
- negative treasury share reserve (47)
- reserve pursuant to Law 292/1993 2,215 ABC 2,215
- hedging reserve (27)
- reserve from measurement of financial assets at FVOCI 2
- reserve for capital grants 19 ABC 19
- stock option reserve 29 ABC 29
(1) (2)
- actuarial reserve (22)
- reserve for share-based payments (LTI) 22
- other 67 ABC 20
Retained earnings/(Loss carried forward) 5,696 ABC 5,696
Total 33,218 15,475
of which amount available for distribution 15 ,472
A: for capital increases.
B: to cover losses.
C: for distribution to shareholders.
(1) Regards lapsed options.
(2) Not distributable in the amount of €3 million regarding options granted by the Parent to employees of subsidiaries that have lapsed.
There are no restrictions on the distribution of the reser-
ves pursuant to Article 2426, paragraph 1(5), of the Italian
Civil Code since there are no unamortized start-up and
expansion costs or research and development expenditu-
re, or departures pursuant to Article 2423, paragraph 4, of
the Civil Code.
It should be noted that, in the three previous years, the
available reserve denominated “retained earnings” has
been used in the amount of €1,322 million for the distribu-
tion of dividends to shareholders.
114 Report and financial statements of Enel SpA at December 31, 2022
23.1 Dividends
The table below shows the dividends paid by the Company
in 2021 and 2022.
Amount distributed
(in millions of euro) Dividend per share (in euro)
Dividends distributed in 2021
Dividends for 2020 3,638 0.358
Interim dividend for 2021
(1)
- -
Special dividends - -
Total dividends distributed in 2021 3,638 0.358
Dividends distributed in 2022
Dividends for 2021 3,861 0.38
Interim dividend for 2022
(2)
- -
Special dividends - -
Total dividends distributed in 2022 3,861 0.38
(1) Approved by the Board of Directors on November 4, 2021 and paid as from January 26, 2022 (interim dividend per share of €0.19 for a total of €1,932 million).
(2) Approved by the Board of Directors on November 3, 2022 and paid as from January 25, 2023 (interim dividend per share of €0.20 for a total of €2,033 million).
Dividends distributed are shown net of the amounts attri-
butable to treasury shares held at the respective record
dates. The Company waived collection of dividends on
these shares, which were recognized under retained ear-
nings.
The dividend for 2022, equal to €0.40 per share, amoun-
ting to a total of €4,067 million (of which €0.20 per share,
for a total of €2,033 million already paid as an interim di-
vidend), will be proposed to the Shareholders’ Meeting of
May 10, 2023, at a single call.
These separate financial statements do not reflect the ef-
fects of the distribution of this dividend for 2022 to sha-
reholders, with the exception of liabilities due to sharehol-
ders for the 2022 interim dividend approved by the Board
of Directors on November 3, 2022, in the maximum poten-
tial amount of €2,033 million and paid as from January 25,
2023, net of the amount pertaining to the 7,153,795 trea-
sury shares held as at the record date of January 24, 2023.
During the year, the Company also paid coupons totaling
€123 million to the holders of perpetual hybrid bonds.
23.2 Capital management
The Company’s objectives for managing capital comprise
safeguarding the business as a going concern, creating
value for stakeholders and supporting the development
of the Group. In particular, the Company seeks to main-
tain an adequate capitalization that enables it to achieve
a satisfactory return for shareholders and ensure access
to external sources of financing, in part by maintaining an
adequate rating.
In this context, the Company manages its capital structu-
re and adjusts that structure when changes in economic
conditions so require. There were no substantive changes
in objectives, policies or processes in 2022.
To this end, the Company constantly monitors develop-
ments in the level of its debt in relation to equity. The si-
tuation at December 31, 2022 and 2021 is summarized in
the following table.
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Non-current financial debt (18,196) (25,572) 7,376
Net current financial debt (1,919) 2,370 (4,289)
Non-current financial assets and long-term securities 4 3 1
Net financial debt (20,111) (23,199) 3,088
Equity 38,342 34,967 3,375
Debt/equity ratio (0.52) (0.66) 0.14
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
115Notes to the separate financial statements
24. Borrowings – €18,196 million, €1,430 million, €8,752 million
Millions of euro Non-current Current
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
Long-term borrowings 18,196 25,572 1,430 216
Short-term borrowings - - 8,752 6,563
For more details about the nature, recognition and clas-
sification of borrowings, please see note 32 “Financial in-
struments”.
25. Employee benefits – €131 million
The Company provides its employees with a variety of
benefits, including deferred compensation benefits, ad-
ditional months’ pay, indemnities in lieu of notice, loyalty
bonuses, supplementary pension plans, supplementary
healthcare plans, additional indemnity for FOPEN pension
contributions, FOPEN pension contributions in excess of
deductible amount and personnel incentive plans.
The item includes accruals made to cover post-employ-
ment benefits under defined benefit plans and other long-
term benefits to which employees are entitled by law, by
contract, or under other forms of employee incentive
schemes.
These obligations, in accordance with IAS 19, were deter-
mined using the projected unit credit method.
The following table reports the change during the year in
the defined benefit obligation, as well as a reconciliation
of the defined benefit obligation with the obligation reco-
gnized at December 31, 2022 and at December 31, 2021.
Millions of euro 2022 2021
Pension
benefits
Health
insurance
Other
benefits Total
Pension
benefits
Health
insurance
Other
benefits Total
CHANGES IN ACTUARIAL OBLIGATION
Actuarial obligation at January 1 123 34 15 172 151 32 17 200
Current service cost - 1 2 3 - 1 8 9
Interest expense 1 - - 1 - - -
Actuarial (gains)/losses arising from
changes in demographic assumptions
- - - - (9) (2) - (11)
Actuarial (gains)/losses arising from
changes in financial assumptions
(14) (7) - (21) - 3 - 3
Experience adjustments 3 1 - 4 - 2 - 2
Past service cost - - - - (1) - - (1)
(Gains)/Losses arising from settlements - - - - - - - -
Employer contributions - - - - - - - -
Contributions from plan participants - - - - - - - -
Payments for closures - - - - - - - -
Other payments (17) (2) (9) (28) (18) (2) (11) (31)
Other changes - - - - - - 1 1
Actuarial obligation at December 31 96 27 8 131 123 34 15 172
116 Report and financial statements of Enel SpA at December 31, 2022
Millions of euro
2022 2021
(Gains)/Losses taken to profit or loss
Service cost 3 9
Interest expense 1 -
(Gains)/Losses arising from settlements - -
Actuarial (gains)/losses on other long-term benefits - -
Other changes - -
Total 4 9
Millions of euro
2022 2021
Remeasurement (gains)/losses in OCI
Actuarial (gains)/losses on defined benefit plans (17) (6)
Other changes - -
Total (17) (6)
The current service cost for employee benefits in 2022
amounted to €4 million (€9 million in 2021).
The main actuarial assumptions used to calculate the liabi-
lities arising from employee benefits, which are consistent
with those used the previous year, are set out below.
2022 2021
Discount rate 3.60%-3.70% 0.00%-0.80%
Rate of wage increases 2.30%-4.30% 0.80%-1.80%
Rate of increase in healthcare costs 3.30% 2.50%
The following table reports the outcome of a sensitivity
analysis that demonstrates the effects on the liability for
healthcare plans as a result of changes reasonably pos-
sible at the end of the year in the actuarial assumptions
used in estimating the obligation.
Millions of euro
An increase
of 0.5% in
discount rate
A decrease
of 0.5% in
discount rate
An increase
of 0.5% in
inflation rate
An increase
of 0.5% in
remuneration
An increase
of 0.5% in
pensions
currently being
paid
An increase
of 1% in
healthcare
costs
An increase of
1 year in life
expectancy
of active
and retired
employees
Healthcare plans:
ASEM
(1) 2 (2) 5 29
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
117Notes to the separate financial statements
26. Provisions for risks and charges – €41
million
Provisions for risks and charges cover probable poten-
tial liabilities that could arise from legal proceedings and
other disputes, without considering the effects of rulings
that are expected to be in the Company’s favor and those
for which any charge cannot be quantified with reasonable
certainty.
In determining the balance of the provision, we have taken
account of both the charges that are expected to result
from court rulings and other dispute settlements for the
year and an update of the estimates for positions arising
in previous years.
The following table shows changes in provisions for risks
and charges.
Taken to profit or loss
Millions of euro Accruals Reversals Utilization Other changes Total
at Dec. 31, 2021 at Dec. 31, 2022
of which current
portion
Provision for litigation and
other risks and charges:
- litigation 3 4 - (1) - 6 4
- other 6 - - - - 6 3
Total 9 4 - (1) - 12 7
Provision for early retirement
incentives
52 - (18) (5) - 29 7
TOTAL PROVISIONS FOR
RISKS AND CHARGES
61 4 (18) (6) - 41 14
The €3 million increase in the provision for litigation mainly
reflects the provision to profit or loss for new disputes. The
provision mainly refers to labor disputes.
The provision for other risks and charges, equal to €6 mil-
lion, is unchanged on the previous year.
The decrease of €23 million in the provision for early reti-
rement incentive plans adopted by the Company reflects
releases to profit or loss of €18 million following the adjust-
ment of the plans and uses during the period of €5 million.
27. Other non-current liabilities – €23 million
“Other non-current liabilities“ amounted to €23 million
(€30 million at December 31, 2021). They regard, in the
amount of €8 million, the debt towards Group companies
that initially arose following Enel SpA’s application (submit-
ted in its capacity as the consolidating company) for reim-
bursement for 2004-2011 of the additional income taxes
paid as a result of not deducting part of IRAP in computing
taxable income for IRES purposes. The liability in respect of
the subsidiaries is balanced by the recognition of non-cur-
rent tax assets (note 16).
The item also includes the liability to employees (€9 mil-
lion) for early termination incentive plans adopted by the
Company (€14 million in 2021) and the non-current portion
of deferred income in respect of up-front fees made at
the time of the establishment of a number of hedging de-
rivative positions in the amount of €5 million (€7 million at
December 31, 2021) in previous years, which are released
to profit or loss on the basis of the amortization plan for
the entire duration of the derivative itself.
28. Trade payables – €155 million
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Trade payables:
- due to third parties 58 51 7
- due to Group companies 97 116 (19)
Total 155 167 (12)
118 Report and financial statements of Enel SpA at December 31, 2022
“Trade payables“ mainly include payables for the provision of
services and other activities performed in 2022, and com-
prise payables due to third parties of €58 million (€51 million
at December 31, 2021) and payables due to Group compa-
nies of €97 million (€116 million at December 31, 2021).
Trade payables due to subsidiaries at December 31, 2022
break down as follows.
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Subsidiaries
Endesa SA 1 1 -
Enel Global Services Srl 54 62 (8)
Enel Global Trading SpA 1 1 -
Enel Green Power SpA 7 4 3
Enel Grids Srl 2 22 (20)
Enel Iberia SRLU 6 5 1
Enel Innovation Hubs Srl 5 4 1
Enel Italia SpA 7 5 2
Enel Produzione SpA 1 1 -
Enel X Srl 2 - 2
Other 11 11 -
Total 97 116 (19)
Trade payables break down by geographical segment as
follows.
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Suppliers
Italy 134 145 (11)
EU 15 16 (1)
Non-EU Europe - 2 (2)
Other 6 4 2
Total 155 167 (12)
29. Other current financial liabilities – €238 million
“Other current financial liabilities“ mainly regard interest
expense accrued on debt outstanding at year end.
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Deferred financial liabilities 205 215 (10)
Other items 33 12 21
Total 238 227 11
More specifically, deferred financial liabilities mainly con-
sist of interest expense accrued on financial debt, while
the other items essentially include amounts due to banks
and Group companies that accrued as of December 31,
2022, but were to be settled in the following year, compri-
sing financial expense on hedge derivatives on commodity
exchange rates entered into on behalf of Group compa-
nies.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
119Notes to the separate financial statements
30. Net financial position and long-term financial assets and securities – €20,111 million
The following table shows the net financial position and
long-term financial assets and securities on the basis of
the items on the statement of financial position.
Millions of euro
Notes at Dec. 31, 2022 at Dec. 31, 2021 Change
Long-term borrowings 24 18,196 25,572 (7,376)
Short-term borrowings 24 8,752 6,563 2,189
Current portion of long-term borrowings 24 1,430 216 1,214
Other non-current financial assets included in debt 15.1 4 3 1
Other current financial assets included in debt 19.1 3,395 8,197 (4,802)
Cash and cash equivalents 21 4,868 952 3,916
Total 20,111 23,199 (3,088)
The net financial debt at December 31, 2022 and Decem-
ber 31, 2021 is reported below in accordance with Gui-
deline 39, issued on March 4, 2021, by ESMA, applicable
as from May 5, 2021, and with warning notice no. 5/2021
issued by CONSOB on April 29, 2021, which replaced refe-
rences to the CESR Recommendations and those in Com-
munication no. DEM/6064293 of July 28, 2006 regarding
the net financial position.
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021
Change
of which with
related parties
of which with
related parties
Liquidity
Bank and post office deposits 4,038 952 3,086
Liquid assets 4,038 952 3,086
Cash equivalents 830 - 830
Short-term loan assets 3,395 8,197 (4,802)
Other current financial assets 3,395 2,489 8,197 7,111 (4,802)
Liquidity 8,263 9,149 (886)
Current financial debt
Current bank debt (25) (640) 615
Other short-term borrowings (8,727) (8,362) (5,923) (5,625) (2,804)
Current financial debt (including debt instruments) (8,752) (6,563) (2,189)
Current portion of long-term bank borrowings (1,430) (216) (1,214)
Non-current financial debt (current portion) (1,430) (216) (1,214)
Current financial debt (10,182) (6,779) (3,403)
Net current financial debt (1,919) 2,370 (4,289)
Non-current financial debt
Long-term bank borrowings (1,527) (2,508) 981
Non-bank financing (leases) - (1) 1
Other long-term borrowings (12,407) (18,739) 6,332
Non-current financial debt (excluding current portion and
debt instruments)
(13,934) (21,248) 7,314
Bonds (4,262) (4,324) 62
Trade payables and other non-interest-bearing non-current
liabilities with a significant financing component
- - -
Non-current financial debt (18,196) (25,572) 7,376
Net financial debt as per CONSOB instructions (20,115) (23,202) 3,087
Long-term loan assets 4 - 3 - 1
NET FINANCIAL DEBT (20,111) (23,199) 3,088
120 Report and financial statements of Enel SpA at December 31, 2022
This statement of the net financial position does not in-
clude financial assets and liabilities in respect of derivati-
ves, since derivative contracts, even if not designated as
hedges for hedge accounting purposes, are in any case
entered into by the Group for hedging purposes.
At December 31, 2022 those financial assets and liabilities
are reported separately in the statement of financial posi-
tion under the following items: “Non-current financial de-
rivative assets” in the amount of €349 million (€753 million
at December 31, 2021), “Current financial derivative assets”
in the amount of €390 million (€60 million at December
31, 2021), “Non-current financial derivative liabilities” in
the amount of €663 million (€1,300 million at December
31, 2021), and “Current financial derivative liabilities” in the
amount of €178 million (€131 million at December 31, 2021).
31. Other current liabilities – €2,873 million
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Tax liabilities 35 551 (516)
Amounts due to Group companies 739 220 519
Amounts due to employees, recreational/assistance associations 20 18 2
Amounts due to social security institutions 9 8 1
Amounts due to customers for security deposits and reimbursements 2 2 -
Other 2,068 1,986 82
Total 2,873 2,785 88
“Tax liabilities“ amounted to €35 million and essentially re-
gard amounts due to tax authorities for corporate income
tax (IRES) of the companies participating in the national
consolidated taxation mechanism (€30 million, compared
with €250 million in 2021) and liabilities for personal inco-
me tax (IRPEF) withholdings for payroll employees in the
amount of €4 million. In 2021, the item included Group VAT
for the 4th Quarter of 2022 of the companies participating
in the Enel VAT Group in the amount of €296 million.
The change on the previous year is essentially due to the
non-payment of the VAT payment on account in 2021, in
line with the clarifications issued by the Revenue Agency,
which ruled that in the first year of establishment of the
single VAT payer the payment on account is not due given
the absence of information on which to calculate the pay-
ment itself.
“Amounts due to Group companies“ amounted to €739
million. They consist of €456 million in payables in respect
of the IRES liability under the consolidated taxation me-
chanism (€86 million at December 31, 2021) and €283 mil-
lion in respect of Group VAT (€134 million at December 31,
2021). The increase of €519 million reflects developments
in the debtor positions noted above.
The item “Other”, equal to €2,068 million, includes the lia-
bility for dividends to be paid to shareholders, essential-
ly represented by the liability for the interim dividend for
2022 in the amount of €2,033 million, which was appro-
ved by the Board of Directors of Enel SpA on November 3,
2022 and paid as from January 25, 2023 (€0.20 per share
for 2022; €0.19 per share for 2021).
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
121Notes to the separate financial statements
32. Financial instruments
32.1 Financial assets by category
The following table shows the carrying amount for each ca-
tegory of financial assets provided by IFRS 9, broken down
into current and non-current financial assets, showing se-
parately hedging derivatives and derivatives measured at
fair value through profit or loss.
Millions of euro Non-current Current
Notes
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
Financial assets at amortized cost 32.1.1 4 3 8,620 9,812
Financial assets at FVOCI
Equity investments in other companies 32.1.2 7 5 - -
Total financial assets at FVOCI 7 5 - -
Financial assets at FVTPL
Derivative financial assets at FVTPL 34 199 178 156 60
Total financial assets at FVTPL 199 178 156 60
Derivative financial assets designated as hedging instruments
Cash flow hedge derivatives 34 150 575 234 -
Total derivative financial assets designated as hedging instruments 150 575 234 -
TOTAL 360 761 9,010 9,872
For more details on the recognition and classification of
current and non-current derivative financial assets, please
see note 34 “Derivatives and hedge accounting”.
For more information on the fair vale measurement, ple-
ase see note 32.1.2 “Financial assets at fair value through
other comprehensive income (FVOCI)”.
32.1.1 Financial assets at amortized cost
The following table shows financial assets measured at
amortized cost by nature, broken down into current and
non-current financial assets.
Millions of euro Non-current Current
Notes
at Dec. 31,
2022
at Dec. 31,
2021 Notes
at Dec. 31,
2022
at Dec. 31,
2021
Cash and cash equivalents - - 21 4,868 952
Trade receivables - - 17 294 275
Loan assets from Group companies
Loan assets on intercompany current accounts - - 19.1 2,489 7,111
Current portion of long-term loan assets 19.1 - - - -
Other financial assets - - 524 14
Total financial assets from Group companies - - 3,013 7, 12 5
Loan assets from others
Cash collateral for margin agreements on OTC derivatives - - 19.1 389 1,077
Other financial assets 4 3 25 13
Total financial assets from others 4 3 414 1,090
Other financial assets - - 31 370
TOTAL 4 3 8,620 9,812
122 Report and financial statements of Enel SpA at December 31, 2022
The main changes compared with 2021 regarded:
• an increase of €3,916 million in cash and cash equivalen-
ts, mainly reflecting higher dividends received during the
period from Group companies;
• a decrease of €4,111 million in loans assets from Group
companies, mainly reflecting the decrease in loan assets
on the intercompany current account held with Group
companies (€4,622 million), partly offset by an increase in
in other financial assets (€512 million) attributable to the
revolving credit line issued to Enel Global Trading;
• a decrease of €688 million in cash collateral paid to
counterparties in derivatives transactions;
• a decrease of €339 million in other financial assets,
reflecting a reduction in dividends authorized by subsi-
diaries and still outstanding at December 31, 2022.
Impairment losses on financial assets at amortized cost
Financial assets measured at amortized cost at December
31, 2022 amounted to €8,624 million and are recognized
net of allowances for expected credit losses, which totaled
€11 million at December 31, 2022 (€12 million at the end
of 2021).
The Company mainly has the following types of financial
assets measured at amortized cost subject to impairment
testing:
• cash and cash equivalents;
• trade receivables;
• loan assets;
• other financial assets.
While cash and cash equivalents are also subject to the
impairment requirements of IFRS 9, the identified impair-
ment loss was immaterial.
The expected credit loss (ECL) – determined considering
probability of default (PD), loss given default (LGD), and
exposure at default (EAD) – is the difference between all
contractual cash flows that are due in accordance with the
contract and all cash flows that are expected to be recei-
ved (i.e., all shortfalls) discounted at the original effective
interest rate.
Depending on the nature of the financial assets and the
credit risk information available, the assessment of a signi-
ficant increase in credit risk may be performed on:
• an individual basis, if the receivables are individually si-
gnificant and for all receivables which have been indi-
vidually identified for impairment based on reasonable
and supportable information;
• a collective basis, if no reasonable and supportable in-
formation is available without undue cost or effort to
measure expected credit losses on an individual instru-
ment basis.
When there is no reasonable expectation of recovering a
financial asset in its entirety or a portion thereof, the gross
carrying amount of the financial asset shall be reduced.
A write-off represents a derecognition event (e.g., the right
to cash flows is legally or contractually extinguished, tran-
sferred or expired).
The following table shows the expected losses for each
class of financial asset measured at amortized cost.
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021
Gross carrying
amount
Allowance
for expected
credit losses Total
Gross carrying
amount
Allowance
for expected
credit losses Total
Cash and cash equivalents 4,868 - 4,868 952 - 952
Trade receivables 300 6 294 282 7 275
Loan assets from Group companies 3,013 - 3,013 7, 125 - 7, 12 5
Loan assets from others 419 5 414 1,098 5 1,093
Other receivables 35 - 35 370 - 370
Total 8,635 11 8,624 9,827 12 9,815
To measure expected losses, the Company assesses trade
receivables and contract assets with the simplified appro-
ach, on both an individual basis and a collective basis.
In the case of individual assessments, PD is generally obtai-
ned from external providers.
Otherwise, in the case of collective assessments, trade re-
ceivables are grouped on the basis of their shared credit
risk characteristics and information on past due positions,
considering a specific definition of default.
The Company mainly defines a defaulted position as one
that is 180 days past due. Accordingly, beyond this time
limit, trade receivables are presumed to be credit impaired.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
123Notes to the separate financial statements
The following table shows changes in the allowance for
expected credit losses on financial assets and trade recei-
vables.
Millions of euro Allowance for expected credit losses
Financial assets Trade receivables
Individual Collective Total Individual Collective Total
Jan. 1, 2021 IFRS 9 5 - 5 - 6 6
Impairment losses - - - 1 - 1
Utilization - - - - - -
Reversals - - - - - -
Total at Dec. 31, 2021 IFRS 9 5 - 5 1 6 7
Impairment losses - - - - - -
Utilization - - - (1) - (1)
Reversals - - - - - -
Total at Dec. 31, 2022 IFRS 9 5 - 5 - 6 6
32.1.2 Financial assets at fair value through other
comprehensive income (FVOCI)
This category mainly includes equity investments in unli-
sted companies irrevocably designated as such at the time
of initial recognition.
Equity investments in other companies, equal to €7 million,
are essentially represented by the equity investment held
by Enel SpA in Empresa Propietaria de la Red SA.
At December 31, 2022 the fair value of the equity invest-
ment was determined on the basis of an independent ap-
praisal using the income approach with the discounted
cash flow method.
32.1.3 Financial assets at fair value through profit or loss
(FVTPL)
This category exclusively includes current and non-current
derivatives used mainly to hedge the debt of the Group
companies. See note 34.2 “Derivatives at fair value through
profit or loss” for more information.
32.2 Financial liabilities by category
The following table shows the carrying amount for each
category of financial liabilities provided by IFRS 9, broken
down into current and non-current financial liabilities,
showing separately hedging derivatives and derivatives
measured at fair value through profit or loss.
Millions of euro Non-current Current
Notes at Dec. 31, 2022 at Dec. 31, 2021 at Dec. 31, 2022 at Dec. 31, 2021
Financial liabilities at amortized cost 32.2.1 18,196 25,572 12,428 8,935
Financial liabilities at fair value through profit or loss
Derivative financial liabilities at FVTPL 34 197 180 178 131
Total 197 180 178 131
Derivative financial liabilities designated as hedging instruments
Cash flow hedge derivatives 34 466 1,120 - -
Total 466 1,120 - -
TOTAL 18,859 26,872 12,606 9,066
For more details on the recognition and classification of cur-
rent and non-current derivative financial liabilities, please see
note 34 “Derivatives and hedge accounting”.
For more details about the fair value measurement, please
see note 35 “Fair value measurement”.
124 Report and financial statements of Enel SpA at December 31, 2022
32.2.1 Financial liabilities at amortized cost
The following table shows financial liabilities at amortized
cost by nature, broken down into current and non-current
financial liabilities.
Millions of euro Non-current Current
Notes at Dec. 31, 2022 at Dec. 31, 2021 Notes at Dec. 31, 2022 at Dec. 31, 2021
Long-term borrowings 24 18,196 25,572 1,430 216
Short-term borrowings - - 24 8,752 6,563
Trade payables - - 28 155 167
Other current financial liabilities - - 31 2,091 1,989
Total 18,196 25,572 12,428 8,935
Other current financial liabilities include the liability for the
dividend to be paid to shareholders, essentially represen-
ted by the liability for the interim dividend for 2022 amoun-
ting to €2,033 million, which was approved by the Board
of Directors of Enel SpA on November 3, 2022 and paid as
from January 25, 2023 (€0.20 per share for 2022; €0.19 per
share for 2021).
Borrowings
Long-term borrowings (including the portion falling due
within 12 months) – €19,626 million
Long-term borrowings, which refer to bonds, bank bor-
rowings and loans from Group companies, denominated
in euros and other currencies, including the portion falling
due within 12 months (equal to €1,430 million), amounted
to €19,626 million at December 31, 2022.
The following table shows the nominal values, carrying
amounts and fair values of long-term borrowings at De-
cember 31, 2022, including the portion falling due within
12 months, grouped by type of borrowing and type of inte-
rest rate. For listed debt instruments, the fair value is given
by official prices. For unlisted debt instruments, fair value
is determined using valuation techniques appropriate for
each category of financial instrument and the associated
market data for the reporting date, including the credit
spreads of the Group.
Millions of euro
Nominal
value
Carrying
amount
Current
portion
Portion
due in
more than
12 months Fair value
Nominal
value
Carrying
amount
Current
portion
Portion
due in
more than
12 months Fair value
Carrying
amount
at Dec. 31, 2022 at Dec. 31, 2021 Change
Bonds:
- fixed rate 3,601 3,584 - 3,584 3,672 3,571 3,549 - 3,549 5,804 35
- floating rate 775 775 97 678 823 872 872 97 775 1,047 (97)
Total 4,376 4,359 97 4,262 4,495 4,443 4,421 97 4,324 6,851 (62)
Bank borrowings:
- floating rate 1,527 1,527 - 1,527 1,548 2,508 2,508 - 2,508 1,398 (981)
Total 1,527 1,527 - 1,527 1,548 2,508 2,508 - 2,508 1,398 (981)
Non-bank financing:
- under fixed-rate
leases
1 1 1 - 1 2 2 1 1 2 (1)
Total 1 1 1 - 1 2 2 1 1 2 (1)
Loans from Group
companies:
- fixed rate 13,186 13,186 1,286 11,900 10,730 13,258 13,258 - 13,186 5,992 (72)
- floating rate 553 553 46 507 568 5,599 5,599 118 5,553 5,706 (5,046)
Total 13,739 13,739 1,332 12,407 11,298 18,857 18,857 118 18,739 11,698 (5,118)
Total fixed-rate
borrowings
16,788 16,771 1,287 15,484 14,403 16,831 16,809 1 16,736 11,798 (38)
Total floating-rate
borrowings
2,855 2,855 143 2,712 2,939 8,979 8,979 215 8,836 8,151 (6,124)
TOTAL 19,643 19,626 1,430 18,196 17, 3 42 25,810 25,788 216 25,572 19,949 (6,162)
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
125Notes to the separate financial statements
For more details about the maturity analysis of borrowin-
gs, please see note 33 “Risk management”, while for more
about fair value measurement inputs, please see note 35
“Fair value measurement”.
The table below shows long-term borrowings by currency
and interest rate.
Long-term borrowings by currency and interest rate
Millions of euro Carrying amount
Nominal
value
Current
average
nominal
interest rate
Current
effective
interest rate
at Dec. 31, 2021 at Dec. 31, 2022 at Dec. 31, 2022
Euro 23,689 17,476 17,480 2.4% 2.4%
US dollar 1,406 1,495 1,498 7. 8 % 8.2%
Pound sterling 692 655 665 5.7% 5.9%
Other currencies 1 - - - -
Total non-euro currencies 2,099 2,150 2,163
TOTAL 25,788 19,626 19,643
The table below reports changes in the nominal value of
long-term debt.
Millions of euro
Nominal value Repayments
New
borrowings
Other
Exchange
differences
Nominal value
at Dec. 31, 2021 at Dec. 31, 2022
Bonds 4,443 (97) - - 30 4,376
Bank borrowings 2,508 (5,250) 4,250 - 19 1,527
Non-bank financing 2 (1) - - - 1
Loans from Group companies 18,857 (5,118) - - - 13,739
Total 25,810 (10,466) 4,250 - 49 19,643
Compared with December 31, 2021, the nominal value of
long-term debt shows an overall decrease of €6,167 mil-
lion, mainly due to:
• the early repayment of three loan agreements from Enel
Finance International NV (€5,000 million) and the repay-
ment of two borrowings falling due from Enel Finance
International NV (€118 million);
• a decrease in bank borrowings reflecting repayments of
revolving credit lines totaling €5,250 million;
• an increase in bank borrowings generated by uses of re-
volving credit lines totaling €4,250 million.
The following table reports the characteristics of the bank
borrowings obtained in 2022.
New borrowings
Type of loan Issuer Issue date
Amount
financed
(millions of euro) Currency Interest rate (%) Type of rate Maturity
Bank borrowings
Enel SpA 07.03.2022 200 EUR Euribor + 0.38% Floating rate 03.05.2024
Enel SpA 14.09.2022 200 EUR Euribor + 0.38% Floating rate 03.05.2024
Enel SpA 30.09.2022 350 EUR Euribor + 0.45% Floating rate 26.07.2025
Enel SpA 30.09.2022 648 EUR Euribor + 0.40% Floating rate 12.05.2025
Enel SpA 30.09.2022 1,852 EUR Euribor + 0.40% Floating rate 05.03.2026
Enel SpA 30.09.2022 1,000 EUR Euribor + 0.52% Floating rate 02.10.2024
Total 4,250
126 Report and financial statements of Enel SpA at December 31, 2022
New borrowings in 2022 involved revolving credit lines. At
December 31, 2022, those uses had been entirely repaid.
Recourse to this type of loan is part of the Group’s finan-
cial optimization plan aimed at responding to the chan-
ging needs of the markets.
The main long-term borrowings of Enel SpA are gover-
ned by covenants that are commonly adopted in inter-
national business practice. These borrowings are mainly
represented by the bond issues carried out within the
framework of the Global/Euro Medium Term Notes pro-
gram, issues of subordinated unconvertible hybrid bonds,
the Revolving Facility Agreement obtained on March 5,
2021 by Enel SpA and Enel Finance International NV from
a pool of banks and amended on May 11, 2022 of up to
€13.5 billion (the “Revolving Facility Agreement”), the Su-
stainability-Linked Loan Facility Agreement obtained by
Enel SpA on October 15, 2020 from a pool of banks in
the amount of up to €1 billion, the €12 billion revolving
credit facility signed by Enel SpA with a pool of financial
institutions on December 23, 2022 and guaranteed by the
Italian export credit agency SACE SpA up to 70% of its
nominal amount (the “€12 billion Revolving Credit Facili-
ty”), the loans granted to Enel SpA by UniCredit SpA and
the Facility Agreement obtained on October 5, 2021 by
Enel SpA from Bank of America Europe Designated Acti-
vity Company in the amount of $348,750,000 (equal to
€300 million at the signing date), the sustainability-lin-
ked financing agreement signed on September 30, 2022
between Enel Finance America LLC (EFA) as the borrower
and Enel SpA (as the guarantor) with Denmark’s Export
Credit Agency (EKF) and Citi for a total of $800 million
(“EKF Facility”).
The main covenants in respect of the bond issues in the
Global/Euro Medium Term Notes program of Enel SpA
and Enel Finance International NV (including the green
bonds of Enel Finance International NV guaranteed by
Enel SpA, which are used to finance the Group’s eligible
green projects) and those related to bonds issued by Enel
Finance International NV on the American market can be
summarized as follows:
• negative pledge clauses under which the issuer and
the guarantor may not establish or maintain (except
under statutory requirement) mortgages, liens or other
encumbrances on all or part of its assets or revenue,
to secure certain financial borrowings, unless the same
(5) The €12 billion Revolving Credit Facility is part of a structured course of action to protect Italy’s energy system and must exclusively be used to fund the collateral
requirements of the trading activities of Enel and Enel Global Trading SpA on energy markets. Failure to meet this commitment constitutes an event of default.
The transaction falls within the framework of the measures that current legislation makes available to all Italy-based companies that meet specific characteristics,
in order to face the negative effects deriving from the Russia-Ukraine crisis. The transaction is in line with similar instruments made available in other European
countries.
The EKF Facility provide for a “reputational damage” clause, under which EKF can request the cancellation of the financial commitment undertaken by it and the
early payment of the sums disbursed if it has suffered ascertained harm to its own reputation or that of the Danish State as a result of substantial breach of certain
regulations. It also provides for the commitment, also of the guarantor, to ensure compliance with certain environmental and social regulations and standards.
restrictions are extended equally or pro rata to the
bonds in question;
• pari passu clauses, under which bonds and the associa-
ted guarantees constitute a direct, unconditional and
unsecured obligation of the issuer and the guarantor,
do not grant preferential rights among them and have
at least the same seniority as other present and futu-
re unsubordinated and unsecured bonds of the issuer
and the guarantor;
• cross-default clauses, under which the occurrence of a
default event in respect of a specified financial liability
(above a threshold level) of the issuer, the guarantor or
significant subsidiaries constitutes a default in respect
of the liabilities in question, which may become imme-
diately repayable.
Since 2019, Enel Finance International NV has issued a
number of “sustainable” bonds on the European market
(as part of the Euro Medium Term Notes - EMTN bond
issue program) and on the American market, both gua-
ranteed by Enel SpA, linked to the achievement of a num-
ber of the Sustainable Development Goals (SDGs) of the
United Nations that contain the same covenants as other
bonds of the same type. In 2022 Enel Finance America
LLC issued sustainability-linked bonds of the same type
on the American market, guaranteed by Enel SpA.
The main covenants covering the hybrid bonds of Enel
SpA, including the perpetual hybrid bonds that will only
be repaid in the event of the dissolution or liquidation of
the Company, can be summarized as follows:
• subordination clauses: each hybrid bond is subordinate
to all other bonds of the issuer and has the same se-
niority as other hybrid financial instruments issued and
greater seniority than equity instruments;
• prohibition on mergers with other companies, the sale
or leasing of all or a substantial part of the company’s
assets to another company, unless the latter succeeds
in all obligations of the issuer.
The main covenants for the Revolving Facility Agreement
and other loan agreements signed by Enel SpA are sub-
stantially similar and can be summarized as follows
(5)
:
• negative pledge clauses, under which the borrower
and, in some cases, significant subsidiaries may not
establish mortgages, liens or other encumbrances on
all or part of their respective assets to secure certain
financial liabilities, with the exception of expressly per-
mitted encumbrances;
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
127Notes to the separate financial statements
• disposals clauses, under which the borrower and, in
some cases, the subsidiaries of Enel may not dispose
of their assets or a significant portion of their assets or
operations, with the exception of expressly permitted
disposals;
• pari passu clauses, under which the payment undertakin-
gs of the borrower have the same seniority as its other
unsecured and unsubordinated payment obligations;
• change-of-control clauses, which are triggered in the
event (i) control of Enel is acquired by one or more par-
ties other than the Italian State or (ii) Enel or any of its
subsidiaries transfer a substantial portion of the Group’s
assets to parties outside the Group such that the finan-
cial reliability of the Group is significantly compromised.
The occurrence of one of the two circumstances may
give rise to (a) the renegotiation of the terms and condi-
tions of the financing or (b) compulsory early repayment
of the financing by the borrower;
• cross-default clauses, under which the occurrence of a
default event in respect of a specified financial liability
(above a threshold level) of the borrower or significant
subsidiaries constitutes a default in respect of the lia-
bilities in question, which may become immediately re-
payable.
The borrowings considered specify events of default typi-
cal of international business practice, such as, for example,
insolvency, bankruptcy proceedings or the entity ceases
trading.
None of the covenants indicated above has been triggered
to date.
Lastly, it should be noted that Enel SpA issued certain gua-
rantees in the interest of a number of Group companies in
relation to the commitments undertaken within the con-
text of the loan agreements. These guarantees and the
associated loan contracts include certain covenants and
events of default, some borne by Enel SpA as the guaran-
tor, typical of international business practice.
Debt structure after hedging
The following table shows the effect of the hedges of cur-
rency risk on the gross long-term debt structure (including
portions maturing in the next 12 months).
Millions of euro at Dec. 31, 2022 at Dec. 31, 2021
Initial debt structure
Hedged
debt
Debt
structure
after
hedging Initial debt structure
Hedged
debt
Debt
structure
after
hedging
Carrying
amount
Nominal
value %
Carrying
amount
Nominal
value %
Euro 17,476 17,480 89% 2,163 19,643 23,690 23,696 91.8% 2,114 25,810
US dollar 1,495 1,498 8% (1,498) - 1,406 1,412 5.5% (1,412) -
Pound sterling 655 665 3% (665) - 692 702 2.7% (702) -
Total 19,626 19,643 100.0% - 19,643 25,788 25,810 100.0% - 25,810
The following table shows the effect of the hedges of inte-
rest rate risk on the gross long-term debt outstanding at
the reporting date.
Gross long-term debt
% at Dec. 31, 2022 at Dec. 31, 2021
Before hedging After hedging Before hedging After hedging
Floating rate 15.0 8.0 34.8 29.8
Fixed rate 85.0 92.0 65.2 70.2
Total 100.0 100.0 100.0 100.0
128 Report and financial statements of Enel SpA at December 31, 2022
Short-term borrowings – €8,752 million
The following table shows short-term borrowings at De-
cember 31, 2022, by type.
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Loans from third parties
Bank borrowings 25 590 (565)
Bank borrowings (ordinary current account) - 50 (50)
Cash collateral for CSAs on OTC derivatives received 365 298 67
Total 390 938 (548)
Borrowings from Group counterparties
Short-term borrowings from Group companies (on intercompany current
account)
5,362 5,625 (263)
Other short-term borrowings from Group companies 3,000 - 3,000
Total 8,362 5,625 2,737
TOTAL 8,752 6,563 2,189
It should be specified that the fair value of current bor-
rowings equals their carrying amount as the impact of di-
scounting is not significant.
32.2.2 Financial liabilities at fair value through profit or
loss (FVTPL)
This category includes solely current and non-current de-
rivative financial liabilities relating mainly to hedges of the
debt of Group companies. More information is given in
note 34.2 “Derivatives at fair value through profit or loss”.
32.2.3 Net gains/(losses)
The following table shows net gains and losses by category
of financial instruments, excluding derivatives.
Millions of euro Net gains/(losses)
of which:
impairment loss/
gain
at Dec. 31, 2022 at Dec. 31, 2021 at Dec. 31, 2022
Financial assets at amortized cost 371 232 -
Financial assets at FVOCI - 1 -
Financial liabilities at amortized cost (695) (743) -
For more details on net gains and losses on derivatives,
please see note 7 “Net financial income/(expense) from
derivatives”.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
129Notes to the separate financial statements
33. Risk management
Financial risks
As part of its operations, the Company is exposed to a va-
riety of financial risks, notably interest rate risk, currency
risk, credit and counterparty risk and liquidity risk.
Enel SpA has adopted a system for governing financial
risks comprising internal committees, dedicated policies
and operating limits. The goal is to appropriately mitigate
financial risks in order to prevent unexpected variations in
financial performance, without ruling out the possibility of
seizing any opportunities that may arise.
Interest rate risk and currency risk
As part of its operations as an industrial holding company,
Enel SpA is exposed to different market risks, notably the
risk of changes in interest rates and exchange rates.
Interest rate risk and currency risk are primarily generated
by the presence of financial instruments.
The main financial liabilities held by the Company inclu-
de bonds, bank borrowings, other borrowings, derivati-
ves, cash collateral for derivatives transactions and trade
payables. The main purpose of those financial instruments
is to finance the operations of the Company. The main fi-
nancial assets held by the Company include loan assets,
derivatives, cash deposits provided as collateral for deriva-
tives contracts, cash and cash equivalents and short-term
deposits, as well as trade receivables. For more details, ple-
ase see note 32 “Financial instruments”.
The source of exposure to interest rate risk and currency
risk did not change with respect to the previous year.
As the Parent, Enel SpA centralizes some treasury mana-
gement functions and access to financial markets with re-
gard to financial derivatives contracts on interest rates and
exchange rates. As part of this activity, Enel SpA acts as an
intermediary for Group companies with the market, taking
positions that, while they can be substantial, do not howe-
ver represent an exposure to the above risks for Enel SpA.
In 2022, the Group was positioned below the clearing thre-
sholds for all asset classes established under the EMIR (Re-
gulation (EU) no. 648/2012), maintaining its classification
as a non-financial counterparty.
The volume of transactions in financial derivatives outstan-
ding at December 31, 2022 is reported below, with specifi-
cation of the notional amount of each class of instrument.
The notional amount of a derivative contract is the amount
on which cash flows are exchanged. This amount can be
expressed as a value or a quantity (for example tons, con-
verted into euro by multiplying the notional amount by the
agreed price).
The notional amounts of derivatives reported here do not
represent amounts exchanged between the parties and
therefore are not a measure of the Company’s credit risk
exposure.
Interest rate risk
Interest rate risk is the risk that the fair value or future cash
flows of a financial instrument will fluctuate because of
changes in market interest rates.
Interest rate risk for the Company manifests itself as a
change in the flows associated with interest payments on
floating-rate financial liabilities, a change in financial terms
and conditions in negotiating new debt instruments or as
an adverse change in the value of financial assets/liabilities
measured at fair value, which are typically fixed-rate debt
instruments.
Interest rate risk is managed with the dual goals of redu-
cing the amount of debt exposed to interest rate fluctua-
tions and containing the cost of funds, limiting the volatility
of results.
This goal is pursued through the strategic diversification
of the portfolio of financial liabilities by contract type, ma-
turity and interest rate, and modifying the risk profile of
specific exposures using OTC derivatives, mainly interest
rate swaps.
The notional amount of outstanding contracts is reported
below.
Millions of euro Notional amount
at Dec. 31, 2022 at Dec. 31, 2021
Interest rate derivatives
Interest rate swaps 5,246 6,699
Total 5,246 6,699
The term of such contracts does not exceed the maturity
of the underlying financial liability, so that any change in
the fair value and/or cash flows of such contracts is offset
by a corresponding change in the fair value and/or cash
flows of the underlying position.
Interest rate swaps normally provide for the periodic
exchange of floating-rate interest flows for fixed-rate inte-
rest flows, both of which are calculated on the basis of the
notional principal amount.
The notional amount of open interest rate swaps at the
end of the year was €5,246 million (€6,699 million at De-
cember 31, 2021), of which €1,490 million in respect of he-
dges of the Company’s share of debt, and €3,756 million
in respect of hedges of the debt of Group companies with
130 Report and financial statements of Enel SpA at December 31, 2022
the market intermediated in the same notional amount
with those companies. The decrease in the overall notional
amount is mainly attributable to the normal decline in the
residual principal amount of amortizing instruments on in-
terest rates.
For more details on interest rate derivatives, please see
note 34 “Derivatives and hedge accounting”.
The amount of floating-rate debt that is not hedged
against interest rate risk is the main risk factor that could
impact the income statement (raising borrowing costs) in
the event of an increase in market interest rates.
At December 31, 2022, 15% of gross long-term finan-
cial debt was floating rate (34.8% at December 31, 2021).
Taking account of hedges of interest rates considered
effective pursuant to IFRS 9, 92% of gross long-term fi-
nancial debt was hedged at December 31, 2022 (70.2% at
December 31, 2021). Including derivatives treated as he-
dges for management purposes but ineligible for hedge
accounting, the ratio is essentially unchanged.
Interest rate risk sensitivity analysis
The Company analyzes the sensitivity of its exposure by
estimating the effects of a change in interest rates on the
portfolio of financial instruments.
More specifically, sensitivity analysis measures the poten-
tial impact of market scenarios on equity, for the cash flow
hedge component, and on profit or loss, for the fair value
hedge component on the fair value of financial derivatives
and the portion of gross long-term debt not hedged using
financial derivatives.
These scenarios are represented by parallel increases and
decreases in the yield curve as at the reporting date.
There were no changes in the methods and assumptions
used in the sensitivity analysis compared with the previous
year.
With all other variables held constant, pre-tax profit would
be affected as follows.
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021
Pre-tax impact on profit
or loss Pre-tax impact on equity
Pre-tax impact on profit
or loss Pre-tax impact on equity
Basis
points Increase Decrease Increase Decrease Increase Decrease Increase Decrease
Change in financial
expense on gross long-
term floating-rate debt in
foreign currency
25 3.9 (3.9) - - 19.2 (19.2) - -
Change in fair value of
derivatives classified as
non-hedging instruments
25 3.5 (3.5) - - 4.3 (4.3) - -
Change in fair value of
derivatives designated as
hedging instruments
25
Cash flow hedges 25 - - 12.0 (12.0) - - 47. 9 (47.9)
Fair value hedges 25 - - - - - - - -
Currency risk
Currency risk is the risk that the fair value or future cash
flows of a financial instrument will fluctuate because of
changes in exchange rates.
For Enel SpA, the main source of currency risk is the pre-
sence of monetary financial instruments denominated in a
currency other than the euro, mainly bonds denominated
in foreign currency.
The exposure to currency risk did not change with respect
to the previous year.
For more details, please see note 32 “Financial instrumen-
ts ”.
In order to minimize exposure to changes in exchange ra-
tes, the Company normally uses a variety of OTC derivati-
ves such as currency forwards and cross currency interest
rate swaps. The term of such contracts does not exceed
the maturity of the underlying exposure.
Currency forwards are contracts in which the counter-
parties agree to exchange principal amounts denomina-
ted in different currencies at a specified future date and
exchange rate (the strike). Such contracts may call for the
actual exchange of the two amounts (deliverable forwards)
or payment of the difference between the strike exchange
rate and the prevailing exchange rate at maturity (non-de-
liverable forwards).
Cross currency interest rate swaps are used to transform a
long-term fixed- or floating-rate liability in foreign curren-
cy into an equivalent floating- or fixed-rate liability in eu-
ros. In addition to having notionals denominated in diffe-
rent currencies, these instruments differ from interest rate
swaps in that they provide both for the periodic exchange
of cash flows and the final exchange of principal.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
131Notes to the separate financial statements
The following table reports the notional amount of tran-
sactions outstanding at December 31, 2022 and Decem-
ber 31, 2021, broken down by type of hedged item.
Millions of euro Notional amount
at Dec. 31, 2022 at Dec. 31, 2021
Foreign exchange derivatives
Currency forwards: 14,065 7,894
- hedging currency risk on commodities 10,252 5,216
- hedging future cash flows 2,656 2,347
- other currency forwards 1,157 331
Cross currency interest rate swaps 3,104 3,078
Total 17, 169 10,972
More specifically, these include:
• currency forward contracts with a total notional amount
of €10,252 million, of which €5,126 million to hedge
the currency risk associated with purchases of energy
commodities by Group companies, with matching tran-
sactions with the market;
• currency forward contracts with a notional amount of
€2,656 million, to hedge the currency risk associated
with other expected cash flows in currencies other than
the euro, of which €1,335 million in market transactions;
• currency forward contracts with a notional amount of
€1,157 million, of which €666 million in market tran-
sactions to hedge the currency risk on investment spen-
ding (€440 million) and, to a lesser extent, operating
expenditure;
• cross currency interest rate swaps with a notional
amount of €3,104 million to hedge the currency risk on
the debt of Enel SpA or other Group companies deno-
minated in currencies other than the euro.
For more details, please see note 34 “Derivatives and he-
dge accounting”.
An analysis of the Group’s debt shows that 11% of gross
medium and long-term debt is denominated in currencies
other than the euro.
Considering exchange rate hedges and the portion of debt
in foreign currency that is denominated in the presenta-
tion currency or the functional currency of the Company,
the debt is fully hedged using cross currency interest rate
swaps.
Currency risk sensitivity analysis
The Company analyzes the sensitivity of its exposure by
estimating the effects of a change in exchange rates on
the portfolio of financial instruments.
More specifically, sensitivity analysis measures the poten-
tial impact of market scenarios on equity, for the cash flow
hedge component, and on profit or loss, for the fair value
hedge component on the fair value of financial derivatives
and the portion of gross long-term debt not hedged using
financial derivatives.
These scenarios are represented by the appreciation/de-
preciation of the euro against all of the foreign currencies
compared with the value observed as at the reporting date.
There were no changes in the methods and assumptions
used in the sensitivity analysis compared with the previous
year.
With all other variables held constant, pre-tax profit would
be affected as follows.
132 Report and financial statements of Enel SpA at December 31, 2022
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021
Pre-tax impact on profit
or loss
Pre-tax impact
on equity
Pre-tax impact on profit
or loss
Pre-tax impact
on equity
Ex-
change
rate
Apprecia-
tion of euro
Deprecia-
tion of euro
Apprecia-
tion of euro
Deprecia-
tion of euro
Apprecia-
tion of euro
Deprecia-
tion of euro
Apprecia-
tion of euro
Deprecia-
tion of euro
Change in financial expense
on gross long-term floating-
rate debt in foreign currency
after hedging
10% - - - - - - - -
Change in fair value of
derivatives classified as non-
hedging instruments
10% (0.1) 0.1 - - (2.8) 3.4 - -
Change in fair value of
derivatives designated as
hedging instruments
10%
Cash flow hedges 10% - - (186.1) 227.5 - - (225.1) 275.1
Fair value hedges 10% - - - - - - - -
Credit and counterparty risk
Credit risk is represented by the possibility of a deterio-
ration in the creditworthiness of a counterparty in a fi-
nancial transaction that could have an adverse impact on
the creditor position. The Company is exposed to credit
risk from its financial activities, including transactions in
derivatives, deposits with banks and financial institutions,
foreign exchange transactions and other financial instru-
ments.
The sources of exposure to credit risk did not change
with respect to the previous year.
The Company’s management of financial credit risk is ba-
sed on the selection of counterparties from among le-
ading Italian and international financial institutions with
high credit standing considered solvent both by the mar-
ket and on the basis of internal assessments, diversifying
the exposure among them. Credit exposures and asso-
ciated credit risk are regularly monitored by the depart-
ments responsible for monitoring risks under the policies
and procedures outlined in the governance rules for ma-
naging the Group’s risks, which are also designed to en-
sure prompt identification of possible mitigation actions
to be taken.
Within this general framework, Enel SpA entered into
margin agreements with the leading financial institutions
with which it operates that call for the exchange of cash
collateral, which significantly mitigates the exposure to
credit risk.
Loan assets
Millions of euro
Staging
Basis for recognition
of expected credit
loss allowance
Average loss rate
(PD*LGD)
Gross carrying
amount
Expected credit
loss allowance Carrying amount
at Dec. 31, 2022
Performing 12-month ECL 0.15% 3,432 5 3,427
Underperforming Lifetime ECL - - -
Non-performing - - -
Total 3,432 5 3,427
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
133Notes to the separate financial statements
Trade receivables and other financial assets: collective measurement
Millions of euro at Dec. 21, 2022
Average loss
rate (PD*LGD)
Gross carrying
amount
Expected
credit loss
allowance
Carrying
amount
Trade receivables
Trade receivables not past due 55 - 55
Trade receivables past due:
- more than 180 days (credit impaired) 2.45% 245 6 239
Total trade receivables 300 6 294
Other financial assets
Other financial assets not past due 30 - 30
Other financial assets past due - - -
Total other financial assets 30 - 30
TOTAL 330 6 324
Liquidity risk
Liquidity risk is the risk that the Company will encounter
difficulty in meeting obligations associated with financial
liabilities that are settled by delivering cash or another fi-
nancial asset.
The objectives of liquidity risk management policies are:
• ensuring an appropriate level of liquidity for the Com-
pany, minimizing the associated opportunity cost;
• maintaining a balanced debt structure in terms of the
maturity profile and funding sources.
In the short term, liquidity risk is mitigated by maintaining
an appropriate level of unconditionally available resources,
including cash and short-term deposits, available commit-
ted credit lines and a portfolio of highly liquid assets.
In the long term, liquidity risk is mitigated by maintaining
a balanced debt maturity profile and diversifying funding
sources in terms of instruments, markets/currencies and
counterparties.
At December 31, 2022 Enel SpA had a total of €4,868 mil-
lion in cash or cash equivalents (€952 million at Decem-
ber 31, 2021), and committed lines of credit amounting to
€8,300 million, all of which maturing in more than one year
(€5,500 million at December 31, 2021).
Maturity analysis
The table below summarizes the maturity profile of the
Company’s long-term debt.
Millions of euro Maturing in
Less than 3
months
Between 3
months and
1 year
Between 1
and 2 years
Between 2
and 5 years
Over 5
years
Bonds:
- fixed rate - - 748 848 1,988
- floating rate - 97 97 291 290
Total - 97 845 1,139 2,278
Bank borrowings:
- fixed rate - - 200 1,327 -
Total - - 200 1,327 -
Non-bank financing:
- under fixed-rate leases - 1 - - -
Total - 1 - - -
Loans from Group companies:
- fixed rate 43 1,243 86 258 11,556
- floating rate 23 23 46 461 -
Total 66 1,266 132 719 11,556
TOTAL 66 1,364 1,177 3,185 13,834
134 Report and financial statements of Enel SpA at December 31, 2022
Offsetting financial assets and financial
liabilities
The following table reports the net financial assets and lia-
bilities. More specifically, it shows that there are no netting
arrangements for derivatives in the separate financial sta-
tements since the Company does not plan to offset assets
and liabilities. As envisaged by current market regulations
and to guarantee transactions involving derivatives, Enel
SpA has entered into margin agreements with leading fi-
nancial institutions that call for the exchange of cash colla-
teral, broken down as shown in the table.
Millions of euro
at Dec. 31,
2022
(a) (b) (c)=(a)-(b) (d) (e)=(c)-(d)
Correlated amounts not offset in
the financial statements
(d)(i),(d)(ii) (d)(iii)
Gross
amounts of
recognized
financial
assets/
(liabilities)
Gross amounts
of recognized
financial assets/
(liabilities) offset
in the statement
of financial
position
Net amounts
of financial
assets/
(liabilities)
presented in
the statement
of financial
position
Financial
instruments
Net portion of
financial assets/
(liabilities)
guaranteed with
cash collateral
Net amount
of financial
assets/
(liabilities)
FINANCIAL ASSETS
Derivative assets:
- on interest rate risk 172 - 172 - (236) (64)
- on currency risk 567 - 567 - (416) 150
Total derivative assets 739 - 739 - (653) 86
TOTAL FINANCIAL ASSETS 739 - 739 - (653) 86
FINANCIAL LIABILITIES
Derivative liabilities:
- on interest rate risk (195) - (195) - 76 (119)
- on currency risk (646) - (646) - 601 (44)
Total derivative liabilities (841) - (841) - 678 (164)
TOTAL FINANCIAL LIABILITIES (841) - (841) - 678 (164)
TOTAL NET FINANCIAL ASSETS/
(LIABILITIES)
(102) - (102) - 25 (78)
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
135Notes to the separate financial statements
34. Derivatives and hedge accounting
The following tables report the notional amount and fair
value of derivative financial assets and liabilities by type
of hedge relationship and hedged risk, broken down into
current and non-current derivative financial assets and lia-
bilities.
The notional amount of a derivative contract is the amount
on the basis of which cash flows are exchanged. This
amount can be expressed as a value or a quantity (for
example tons, converted into euros by multiplying the no-
tional amount by the agreed price). Amounts denominated
in currencies other than the euro are translated at the clo-
sing year exchange rates provided by the World Markets
Refinitiv (WMR) Company.
Millions of euro Non-current Current
Notional amount Fair value Notional amount Fair value
DERIVATIVE ASSETS
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021 Change
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021 Change
Derivatives
designated
as hedging
instruments
Cash flow hedges:
- on interest rate
risk
1,000 - 42 - 42 - - - - -
- on currency risk 947 2,114 108 575 (467) 1,171 - 234 - 234
Total cash flow
hedges
1,947 2,114 150 575 (425) 1,171 - 234 - 234
Derivatives at
FVTPL:
- on interest rate
risk
1,819 2,080 129 153 (24) 59 - - - -
- on currency risk 1,630 642 70 25 45 5,617 3,411 156 60 96
Total derivatives at
FVTPL
3,449 2,722 199 178 21 5,676 3,411 156 60 96
TOTAL DERIVATIVE
ASSETS
5,396 4,836 349 753 (404) 6,847 3,411 390 60 330
Millions of euro Non-current Current
Notional amount Fair value Notional amount Fair value
DERIVATIVE
LIABILITIES
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021 Change
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021 Change
Derivatives
designated
as hedging
instruments
Cash flow hedges:
- on interest rate
risk
390 2,440 43 339 (296) - - - - -
- on currency risk 722 712 423 781 (358) - - - - -
Total cash flow
hedges
1,112 3,152 466 1,120 (654) - - - - -
Derivatives at
FVTPL:
- on interest rate
risk
1,819 2,080 128 154 (26) 159 100 23 71 (48)
- on currency risk 1 ,617 660 69 26 43 5,465 3,433 155 60 95
Total derivatives at
FVTPL
3,436 2 ,740 197 180 17 5,624 3,533 178 131 47
TOTAL DERIVATIVE
LIABILITIES
4,548 5,892 663 1,300 (637) 5,624 3,533 178 131 47
136 Report and financial statements of Enel SpA at December 31, 2022
34.1 Hedge accounting
Derivatives are initially recognized at fair value, on the trade
date of the contract, and are subsequently re-measured at
their fair value. The method of recognizing the resulting gain
or loss depends on whether the derivative is designated as a
hedging instrument, and if so, the nature of the item being
hedged.
Hedge accounting is applied to derivatives entered into in
order to reduce risks such as interest rate risk, currency risk
and commodity price risk (including Virtual PPAs) and when
all the criteria provided by IFRS 9 are met.
At the inception of the transaction, the Company docu-
ments the relationship between hedging instruments and
hedged items, as well as its risk management objectives
and strategy. The Company also documents its asses-
sment, both at hedge inception and on an ongoing basis,
of whether hedging instruments are highly effective in off-
setting changes in fair values or cash flows of hedged items.
For cash flow hedges of forecast transactions designated as
hedged items, the Company assesses and documents that
they are highly probable and present an exposure to chan-
ges in cash flows that affect profit or loss.
Depending on the nature of the risk exposure, the Company
designates derivatives as either:
• fair value hedges;
• cash flow hedges.
For more details about the nature and the extent of risks
arising from financial instruments to which the Company is
exposed, please see note 33 “Risk management”.
To be effective a hedging relationship shall meet all of the
following criteria:
• existence of an economic relationship between hedging
instrument and hedged item;
• the effect of credit risk does not dominate the value
changes resulting from the economic relationship;
• the hedge ratio defined at initial designation shall be
equal to the one used for risk management purposes
(i.e., same quantity of the hedged item that the entity
actually hedges and the quantity of the hedging instru-
ment that the entity actually uses to hedge the quantity
of the hedged item).
Based on the IFRS 9 requirements, the existence of an eco-
nomic relationship is evaluated by the Company through a
qualitative assessment or a quantitative computation, de-
pending on the following circumstances:
• if the underlying risk of the hedging instrument and the
hedged item is the same, the existence of an economic
relationship will be provided through a qualitative analysis;
• on the other hand, if the underlying risk of the hedging
instrument and the hedged item is not the same, the
existence of the economic relationship will be demon-
strated through a quantitative method in addition to a
qualitative analysis of the nature of the economic rela-
tionship (i.e., linear regression).
In order to demonstrate that the behavior of the hedging
instrument is in line with those of the hedged item, different
scenarios will be analyzed.
For hedging of commodity price risk, the existence of an
economic relationship is deduced from a ranking matrix
that defines, for each possible risk component, a set of all
standard derivatives available in the market whose ranking is
based on their effectiveness in hedging the considered risk.
In order to evaluate the credit risk effects, the Company
considers the existence of risk mitigating measures (colla-
teral, mutual break-up clauses, netting agreements, etc.).
The Company has established a hedge ratio of 1:1 for all
the hedging relationships (including commodity price risk
hedging) as the underlying risk of the hedging derivative is
identical to the hedged risk, in order to minimize hedging
ineffectiveness.
The hedge ineffectiveness will be evaluated through a qua-
litative assessment or a quantitative computation, depen-
ding on the following circumstances:
• if the critical terms of the hedged item and hedging in-
strument match and there are no other sources of inef-
fectiveness included the credit risk adjustment on the
hedging derivative, the hedge relationship will be consi-
dered fully effective on the basis of a qualitative asses-
sment;
• if the critical terms of the hedged item and hedging
instrument do not match or there is at least one sour-
ce of ineffectiveness, the hedge ineffectiveness will be
quantified applying the dollar offset cumulative method
with hypothetical derivative. This method compares
changes in fair values of the hedging instrument and the
hypothetical derivative between the reporting date and
the inception date.
The main causes of hedge ineffectiveness may be the fol-
lowing:
• basis differences (i.e., the fair value or cash flows of the
hedged item depend on a variable that is different from
the variable that causes the fair value or cash flows of
the hedging instrument to change);
• timing differences (i.e., the hedged item and hedging in-
strument occur or are settled at different dates);
• quantity or notional amount differences (i.e., the hed-
ged item and hedging instrument are based on different
quantities or notional amounts);
• other risks (i.e., changes in the fair value or cash flows of
a derivative hedging instrument or hedged item relate to
risks other than the specific risk being hedged);
• credit risk (i.e., the counterparty credit risk differently im-
pacts the changes in the fair value of the hedging instru-
ments and hedged items).
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
137Notes to the separate financial statements
The conflict between Russia and Ukraine and the difficult
macroeconomic conditions had only a limited impact on
the management of risks, being insufficient to directly and
significantly influence the valuation of derivative instrumen-
ts and the outcome of effectiveness checks of hedges. The
volatility that buffeted financial markets was offset by risk
mitigation actions using derivative financial instruments.
Cash flow hedges
Cash flow hedges are applied in order to hedge the Com-
pany exposure to changes in future cash flows that are at-
tributable to a particular risk associated with a recognized
asset or liability or a highly probable transaction that could
affect profit or loss.
The effective portion of changes in the fair value of deriva-
tives that are designated and qualify as cash flow hedges
is recognized in other comprehensive income. The gain or
loss relating to the ineffective portion is recognized imme-
diately in the income statement.
Amounts accumulated in equity are reclassified to profit
or loss in the years when the hedged item affects profit
or loss (for example, when the hedged forecast sale takes
place).
If the hedged item results in the recognition of a non-fi-
nancial asset (i.e., property, plant and equipment or inven-
tories, etc.) or a non-financial liability, or a hedged forecast
transaction for a non-financial asset or a non-financial
liability becomes a firm commitment for which fair value
hedge accounting is applied, the amount accumulated in
equity (i.e., hedging reserve) shall be removed and included
in the initial amount (cost or other carrying amount) of the
asset or the liability hedged (i.e., “basis adjustment”).
When a hedging instrument expires or is sold, or when a
hedge no longer meets the criteria for hedge accounting,
any cumulative gain or loss existing in equity at that time
remains in equity and is recognized when the forecast
transaction is ultimately recognized in the income state-
ment. When a forecast transaction is no longer expected
to occur, the cumulative gain or loss that was reported in
equity is immediately transferred to the income statement.
For hedging relationships using forwards as a hedging in-
strument, where only the change in the value of the spot
element is designated as the hedging instrument, ac-
counting for the forward element (profit or loss vs OCI) is
defined case by case. This approach is actually applied by
the Company for hedging of currency risk on renewables
assets.
Conversely, for hedging relationships using cross currency
interest rate swaps as hedging instruments, the Company
separates foreign currency basis spreads, in designating
the hedging derivative, and presents them in other com-
prehensive income (OCI) in the hedging costs reserve.
With specific regard to cash flow hedges of commodity
risk, in order to improve their consistency with the risk ma-
nagement strategy, the Company applies a dynamic hed-
ge accounting approach based on specific liquidity requi-
rements (the so-called liquidity-based approach).
This approach requires the designation of hedges through
the use of the most liquid derivatives available on the mar-
ket and replacing them with others that are more effective
in covering the risk in question.
Consistent with the risk management strategy, the liqui-
dity-based approach allows the roll-over of a derivative by
replacing it with a new derivative, not only in the event of
expiry but also during the hedging relationship, if and only
if the new derivative meets both of the following require-
ments:
• it represents a best proxy of the old derivative in terms
of ranking;
• it meets specific liquidity requirements.
Satisfaction of these requirements is verified quarterly.
At the roll-over date, the hedging relationship is not di-
scontinued. Therefore, starting from that date, changes
in the effective fair value of the new derivative will be re-
cognized in equity (the hedging reserve), while changes in
the fair value of the old derivative are recognized through
profit or loss.
The Company currently uses these hedge relationships to
minimize the volatility of profit or loss.
Reform of benchmarks for the determination of interest
rates – IBOR reform
Overview
Interbank Offered Rates (“IBORs”) are benchmark rates at
which banks can borrow funds on the interbank market on
an unsecured basis for a given period ranging from over-
night to 12 months, in a specific currency.
In recent years there have been a number of cases of ma-
nipulation of these rates by the banks contributing to their
calculation. For this reason, regulators around the world
have begun a sweeping reform of interest rate benchmar-
ks that includes the replacement of some benchmarks
with alternative risk-free rates (the IBOR reform).
The Company’s main exposure to IBOR is based on Euribor.
Euribor is still considered compliant with the European
Benchmarks Regulation (BMR) and this permits market
participants to continue to use it for both existing and new
contracts.
In line with the most recent guidance issued by the major
regulatory bodies:
• the 1-month, 3-month and 6-month USD LIBOR bench-
marks will become unrepresentative after June 30, 2023
and the alternative reference rate will be the Secured
Overnight Financing Rate (SOFR);
• the 1-month, 3-month and 6-month GBP LIBOR bench-
marks have become unrepresentative as from Decem-
ber 31, 2021 and have been replaced by the alternative
reference rate Sterling Overnight Index Average (SONIA).
138 Report and financial statements of Enel SpA at December 31, 2022
As a result of the IBOR reform, a number of temporary
exceptions to the rules on hedge relationships have been
allowed in implementation of the amendments to IFRS 9
issued in September 2019 (Phase 1) and August 2020 (Pha-
se 2) to address, respectively:
• pre-replacement issues that impact financial reporting
in the period preceding the replacement of an existing
interest rate benchmark with an alternative risk-free rate
(Phase 1); and
• post-replacement issues that could impact financial
reporting when an existing interest rate benchmark is
reformed or replaced and there is there no longer any
initial uncertainty, but hedge contracts and relationships
still need to be updated to reflect the new benchmark
rates (Phase 2).
Impact of the IBOR reform
In a context of uncertainty regarding the IBOR transition
in the various countries, the Company has determined
the overall number and nominal value of the contracts im-
pacted by the reform. In addition, a number of contractual
amendments have already been implemented in contracts
previously indexed to GBP LIBOR during 2021 and others
will be amended in 2023 on the basis of the evolution of
the IBOR reform and market practice.
Debt and derivatives
The Company’s floating rate debt is mainly benchmarked
against Euribor and is almost entirely hedged using finan-
cial derivatives.
At the reporting date, the Company is planning to take no
action with regard to Euribor since, as stated above, this
benchmark has been comprehensively reformed to com-
ply with the European Benchmarks Regulation. Despite the
continuity with Euribor, replacement clauses may be re-
quired and could therefore be implemented by the Group
in the new contracts in accordance with the evolution of
accepted market practice.
During 2021, the Company obtained new dollar loans in-
dexed to SOFR. The main focus over the coming months
will be how to use the new, alternative risk-free rates for
new financial transactions.
The Company’s derivative instruments are managed
through contracts that are based on framework agree-
ments defined by the International Swaps and Derivatives
Association (ISDA).
The ISDA has revised its standardized contracts in light
of the IBOR reform and amended the choices for floating
rates within the 2006 ISDA definitions to include replace-
ment clauses that would apply upon the permanent di-
scontinuation of specific key benchmarks. These changes
took effect on January 25, 2021. Transactions represented
in the 2006 ISDA definitions carried out on January 25,
2021 or later include adjusted floating-rate options (e.g.,
the choice of floating rate with replacement clause), while
transactions completed before that date (previous deri-
vative contracts) continue to be based on the 2006 ISDA
definitions.
For this reason, the ISDA published an IBOR Fallback Pro-
tocol to facilitate multilateral amendments to include the
amended definitions.
The Company is assessing whether to: (i) adopt that pro-
tocol in the light of its exposure and developments in the
IBOR reform or (ii) adjust in advance any contracts im-
pacted bilaterally by the reform.
Hedge relationships
At the reporting date, hedged items and hedging instru-
ments are primarily indexed to Euribor, SOFR and SONIA.
The Company has assessed the impact of uncertainty en-
gendered by the IBOR reform on hedge relationships at
December 31, 2022 with reference to both hedging instru-
ments and hedged items. Both the hedged items and the
hedging instruments will change their parameterization
from interbank market-based benchmarks (IBORs) to alter-
native risk-free rates (RFRs) as a result of the contractual
amendments that will take effect in the coming years.
In particular, uncertainty remains as to how the replace-
ment will take place with regard to both hedging instru-
ments and hedged items indexed to some IBORs. The
Company manages the uncertainty associated with these
hedge relationships by continuing to apply the temporary
exceptions provided for in the amendments to IFRS 9 is-
sued in September 2019 (Phase 1). It was therefore felt that
the benchmark indices for determining the interest rates
on which the cash flows of the hedged items or the hed-
ging instruments are based would not change as a conse-
quence of the IBOR reform. The exception was applied for
the following hedge relationship requirements:
• determine if a forecast transaction is highly probable;
• establish whether the future hedged cash flows will arise
in a discontinued cash flow hedge relationship;
• assess the economic relationship between the hedged
item and the hedging instrument.
The hedge relationships impacted may become ineffective
attributable to different replacements of existing bench-
marks with alternative risk-free benchmarks. In any case,
the Company will seek to implement the replacements at
the same time.
In addition, the Company changed the reference to GBP
LIBOR in its interest rate hedging instruments used in cash
flow hedge relationships with the new, economically equi-
valent, SONIA benchmark at the end of 2021. Consequent-
ly, the Company no longer applies the amendments to IFRS
9 issued in September 2019 (Phase 1) to these hedge rela-
tionships and, consequently, is applying the amendments
to IFRS 9 issued in August 2020 (Phase 2), modifying the
formal designation of the hedge relationship as required
by the IBOR reform and without considering this event as a
termination of the hedge relationship.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
139Notes to the separate financial statements
Furthermore, for cash flow hedge relationships, in modi-
fying the description of the hedged item in the hedge re-
lationship, the amounts accumulated in the cash flow hed-
ge reserve were considered on the basis of the alternative
benchmark index in relation to which the future hedged
cash flows are determined.
The following table provides details of the notional amoun-
ts of the hedging instruments for which the amendments
to IFRS 9 (both Phase 1 and Phase 2) were applied as at
December 31, 2022, broken down by the alternative ben-
chmark index used for determining the interest rate.
Millions of euro Notional amount
at Dec. 31, 2022
Hedging instruments Phase 1 Phase 2
USD LIBOR/SOFR - -
GBP LIBOR/SONIA - 1,240
Total - 1,240
Unamended contracts including those with specific
replacement clauses
The Company is monitoring the evolution of the transition
from the old interest rate benchmarks to the new rates,
reviewing the overall value of contracts that have not yet
been indexed to the new benchmark rates and, among
these, the value of contracts which already include specific
replacement clauses. The Company considers a contract
to have not yet incorporated an alternative benchmark
rate when the interest rate of the contract is indexed to
an interest rate benchmark still involved in the IBOR reform
and, therefore, when uncertainties still exist as to how and
when replacement with the new benchmark will take place.
Fair value hedges
Fair value hedges are used to protect the Company against
exposures to changes in the fair value of assets, liabilities
or firm commitment attributable to a particular risk that
could affect profit or loss.
Changes in the fair value of derivatives that qualify and are
designated as hedging instruments are recognized in the
income statement, together with changes in the fair value
of the hedged item that are attributable to the hedged risk.
If the hedge no longer meets the criteria for hedge ac-
counting, the adjustment to the carrying amount of a he-
dged item for which the effective interest rate method is
used is amortized to profit or loss over the year to maturity.
The Company does not currently use such hedging rela-
tionships.
For more information on fair value measurement, please
see note 35 “Fair value measurement”.
34.1.1 Hedge relationship by type of credit risk
Interest rate risk
The following table shows the notional amount and the
average rate on instruments hedging interest rate risk on
transactions outstanding at December 31, 2022 and De-
cember 31, 2021, broken down by maturity.
Millions of euro
At Dec. 31, 2022 2023 2024 2025 2026 2027 Beyond Total
Interest rate swaps
Notional amount - - 500 500 - 390 1,390
Average IRS rate 1.63 1.78 4.70
Millions of euro
At Dec. 31, 2021 2022 2023 2024 2025 2026 Beyond Total
Interest rate swaps
Notional amount - - - 500 500 1,440 2,440
Average IRS rate 1.63 1.78 2.35
The interest rate swaps outstanding at the end of the year
and designated as hedging instruments function as a cash
flow hedge and fair value hedge for the hedged item. The
cash flow hedge derivatives refer exclusively to the hed-
ging of certain floating-rate bonds issued since 2001 and
floating-rate bank loans obtained in 2020.
The following table shows the notional amount and the fair
value of hedging derivatives on interest rate risk as at De-
cember 31, 2022 and December 31, 2021.
140 Report and financial statements of Enel SpA at December 31, 2022
Millions of euro Notional amount Fair value assets Notional amount Fair value liabilities
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
Cash flow hedge derivatives 1,000 - 42 - 390 2,440 (43) (339)
Interest rate swaps 1,000 - 42 - 390 2,440 (43) (339)
The improvement in the fair value of derivatives compared
with the previous year is mainly attributable to the general
rise in the yield curve over the course of 2022, leading in
certain cases to an inversion of the fair value from negati-
ve to positive, with a consequent reclassification of those
financial instruments from liabilities to assets.
The following table shows the cash flows expected in co-
ming years from cash flow hedge derivatives hedging in-
terest rate risk.
Millions of euro Fair value Distribution of expected cash flows
Cash flow hedge derivatives on interest
rates
at Dec. 31,
2022 2023 2024 2025 2026 2027 Beyond
Positive fair value 42 13 19 9 5 - -
Negative fair value (43) (8) (5) (7) (6) (6) (23)
The following table shows the impact of interest rate hed-
ge derivatives on the statement of financial position.
Millions of euro Notional amount Carrying amount
Fair value used to measure
ineffectiveness in the year
At December 31, 2022
Interest rate swaps 1,390 (1) (1)
At December 31, 2021
Interest rate swaps 2,440 (339) (339)
The following table shows the impact of hedged items
exposed to interest rate risk on the statement of financial
position.
Millions of euro
Fair value used to
measure ineffectiveness
in the year
Hedging
reserve
Hedging
costs
reserve
Fair value used to
measure ineffectiveness
in the year
Hedging
reserve
Hedging
costs
reserve
2022 2021
Floating-rate borrowings (60) 60 - 252 (252) -
Total (60) 60 - 252 (252) -
The following table shows the impact of cash flow hedges
on interest rate risk on profit or loss and on other com-
prehensive income.
Millions of euro
Total other
comprehensive
income/
(expense)
Ineffective
portion
recognized in
profit or loss
Income
statement item
Hedging
costs
Amount
reclassified
from OCI to
profit or loss
Income statement
item
At December 31, 2022
Floating-rate borrowings 302 - - 5 Financial income
Total at December 31, 2022 302 - - 5
At December 31, 2021
Floating-rate borrowings 112 - - - (13) Financial expense
Total at December 31, 2021 112 - - (13)
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
141Notes to the separate financial statements
Currency risk
The following table shows the notional amount and the
average rate on instruments hedging currency risk on
transactions outstanding as at December 31, 2022 and
December 31, 2021, broken down by maturity.
Millions of euro
At Dec. 31, 2022 2023 2024 2025 2026 2027 Beyond Total
Cross currency interest rate swaps
Notional amount total - 1,171 327 - - 1,342 2,840
Notional amount CCS EUR/USD - 1,171 327 - - - 1,498
Average contractual exchange rate EUR/USD 1.33 1.16
Notional amount CCS EUR/GBP - - - - - 1,342 1,342
Average contractual exchange rate EUR/GBP 0.68
Millions of euro
At Dec. 31, 2021 2022 2023 2024 2025 2026 Beyond Total
Cross currency interest rate swaps
Notional amount total - 1,103 - 308 - 1,415 2,826
Notional amount CCS EUR/USD - 1,103 - 308 - - 1,411
Average contractual exchange rate EUR/USD 1.33 1.16
Notional amount CCS EUR/GBP - - - - - 1,415 1,415
Average contractual exchange rate EUR/GBP 0.68
The following table shows the notional amount and the fair
value of instruments hedging currency risk on transactions
outstanding as at December 31, 2022 and December 31,
2021, broken down by type of hedged item.
Millions of euro Fair value
Notional
amount Fair value
Notional
amount
Assets Liabilities Assets Liabilities
Hedging instrument Hedged item at Dec. 31, 2022 at Dec. 31, 2021
Cross currency interest
rate swaps
Fixed-rate borrowings in
foreign currency
- (107) 2,513 339 (553) 2,518
Cross currency interest
rate swaps
Floating-rate borrowings
in foreign currency
26 - 327 8 - 308
Total 26 (107) 2,840 347 (553) 2,826
The cross currency interest rate swaps outstanding at the
end of the year and designated as hedging instruments
function as a cash flow hedge for the hedged item. More
specifically, these derivatives hedge fixed-rate bonds de-
nominated in foreign currencies and a floating-rate bor-
rowing in US dollars that fell due and was renewed with
Bank of America in 2021.
The following table shows the notional amount and the fair
value of derivatives on currency risk as at December 31, 2022
and December 31, 2021, broken down by type of hedge.
Millions of euro Notional amount Fair value assets Notional amount Fair value liabilities
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
Cash flow hedge derivatives 2,118 2,114 342 575 722 712 (423) (781)
Cross currency interest rate
swaps
2,118 2,114 342 575 722 712 (423) (781)
At December 31, 2022 cross currency interest rate swaps
had a notional amount of €2,841 million (€2,826 million at
December 31, 2021) and an overall negative fair value of
€81 million (a negative €206 million at December 31, 2021).
The slight increase in notional amount (€15 million) mainly
reflected developments in the exchange rate of the euro
against the US dollar and the pound sterling.
142 Report and financial statements of Enel SpA at December 31, 2022
The following table reports the impact on the statement
of financial position of instruments hedging currency risk.
Millions of euro Notional amount Carrying amount
Fair value used to measure
ineffectiveness in the year
At December 31, 2022
Cross currency interest rate swaps 2,840 (81) (77)
At December 31, 2021
Cross currency interest rate swaps 2,826 (206) (206)
The following table reports the impact on the statement
of financial position of hedged items exposed to currency
risk.
Millions of euro
Fair value used
to measure
ineffectiveness in
the year Hedging reserve
Hedging costs
reserve
Fair value used
to measure
ineffectiveness in
the year
Hedging
reserve
Hedging costs
reserve
2022 2021
Fixed-rate borrowings in
foreign currency
107 (107) (4) 213 (213) -
Floating-rate borrowings in
foreign currency
(26) 26 - (8) 8 -
Total 81 (81) (4) 206 (206) -
The following table shows the impact of cash flow hedges
on currency risk on profit or loss and on other comprehen-
sive income.
Millions of euro
Total other
comprehensive
income/
(expense)
Ineffective
portion
recognized in
profit or loss
Income
statement
item
Hedging
costs
Amount
reclassified
from OCI to
profit or loss
Income statement
item
At December 31, 2022
Fixed-rate borrowings in foreign currency 97 - 4 (147) Financial expense
Floating-rate borrowings in foreign currency 65 - - 65 Financial income
Total at December 31, 2022 162 - 4 (82)
At December 31, 2021
Fixed-rate borrowings in foreign currency 251 - 21 (196) Financial expense
Floating-rate borrowings in foreign currency (15) - - 15 Financial income
Total at December 31, 2021 236 - 21 (181)
The following table shows the cash flows expected in co-
ming years from cash flow hedge derivatives on currency
risk.
Millions of euro Fair value Distribution of expected cash flows
Cash flow hedge derivatives on exchange
rates at Dec. 31, 2022 2023 2024 2025 2026 2027 Beyond
Positive fair value 342 278 7 35 7 8 108
Negative fair value (423) (15) (14) (17) (18) (19) (401)
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
143Notes to the separate financial statements
34.1.2 Impact of cash flow hedge derivatives on equity
gross of tax effects
Millions of euro
Hedging
costs
Gross change
in fair value
recognized in
OCI
Gross change
in fair value
recognized in
profit or loss
Gross change
in fair value
recognized in
profit or loss
- Ineffective
portion
Hedging
costs
Gross change
in fair value
recognized in
OCI
Gross change
in fair value
recognized in
profit or loss
Gross change
in fair value
recognized in
profit or loss
- Ineffective
portion
at Dec. 31, 2022 at Dec. 31, 2021
Interest rate
hedges
- 302 5 - - 112 (13) -
Exchange rate
hedges
4 162 (82) - 21 236 (181) -
Hedging
derivatives
4 464 (77) - 21 348 (194) -
34.2 Derivatives at fair value through profit or loss
The following table shows the notional amount and the fair
value of derivatives at FVTPL as at December 31, 2022 and
December 31, 2021.
Millions of euro Notional amount Fair value assets Notional amount Fair value liabilities
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
at Dec. 31,
2022
at Dec. 31,
2021
Derivatives at FVTPL on
interest rates
1,878 2,080 129 153 1,978 2,180 (151) (225)
Interest rate swaps 1,878 2,080 129 153 1,978 2,180 (151) (225)
Derivatives at FVTPL on
exchange rates
7, 2 47 4,053 226 85 7, 0 82 4,093 (224) (86)
Forwards 7, 115 3,927 202 72 6,950 3,967 (199) (73)
Cross currency interest rate
swaps
132 126 24 13 132 126 (25) (13)
Total derivatives at FVTPL 9,125 6,133 355 238 9,060 6,273 (375) (311)
At December 31, 2022 the notional amount of derivatives
at fair value through profit or loss on interest rates and
exchange rates came to €18,185 million (€12,406 million
at December 31, 2021) with a negative fair value of €20
million (a negative €72 million at December 31, 2021).
Interest rate swaps at the end of the year amounted to
€3,856 million. They refer primarily to hedges of the debt of
the Group companies with the market (€1,978 million) and
intermediated with those companies (€1,878 million).
The overall notional amount shows a decline of €404 million
on the previous year, due overall to the decline in the out-
standing principal amount of amortizing interest rate swaps.
Forward contracts hedging currency risk had a notional
amount of €14,065 million (€7,894 million at December
31, 2021). Currency forwards with external counterparties
amounted to €7,128 million (€3,949 million at December
31, 2021), and related mainly to OTC derivatives entered
into to mitigate the currency risk associated with the prices
of energy commodities within the provisioning process of
Group companies and matched with market transactions.
They also hedge the expected cash flows in currencies
other than the currency of account connected with the
acquisition of non-energy commodities and investment
goods in the sectors of renewable energy sector (BESS
- Battery Energy Storage System) and infrastructure and
grids (new generation digital meters), the expected cash
flows in currencies other than the euro connected with
operating costs for the provision of cloud services and
the expected cash flows in foreign currency in respect of
interim dividends authorized by the subsidiaries. Changes
in the notional amount and the fair value are connected
with a greater exposure to exchange rate risk, in particular
towards the US dollar, resulting from the increase in natural
gas prices and the recovery in the generation of electricity
from coal.
Cross currency interest rate swaps, with a notional amount
of €132 million (€126 million at December 31, 2021), relate
to hedges of currency risk on the debt of the Group com-
panies denominated in currencies other than the euro and
matched with market transactions.
144 Report and financial statements of Enel SpA at December 31, 2022
35. Fair value measurement
The Company measures fair value in accordance with IFRS
13 whenever required by the IFRS.
Fair value is defined as the price that would be received to
sell an asset or paid to transfer a liability. The best estimate
is the market price, i.e., its current price, publicly available
and effectively traded on an active, liquid market.
The fair value of assets and liabilities is categorized into
a fair value hierarchy that provides three levels defined as
follows on the basis of the inputs to valuation techniques
used to measure fair value:
• Level 1: quoted prices (unadjusted) in active markets for
identical assets or liabilities to which the Company has
access at the measurement date;
• Level 2: inputs other than quoted prices included within
Level 1 that are observable for the asset or liability, either
directly (that is, as prices) or indirectly (that is, derived
from prices);
• Level 3: inputs for the asset or liability that are not based
on observable market data (that is, unobservable inputs).
In this note, the relevant disclosures are provided in order
to assess the following:
• for assets and liabilities that are measured at fair value
on a recurring or non-recurring basis in the statement of
financial position after initial recognition, the valuation
techniques and inputs used to develop those measure-
ments; and
• for recurring fair value measurements using significant
unobservable inputs (Level 3), the effect of the measure-
ments on profit or loss or other comprehensive income
for the year.
For this purpose:
• recurring fair value measurements are those that the
IFRSs require or permit in the statement of financial po-
sition at the end of each reporting period;
• non-recurring fair value measurements are those that
the IFRSs require or permit in the statement of financial
position in particular circumstances.
The fair value of derivative contracts is determined using
the official prices for instruments traded on regulated
markets. The fair value of instruments not listed on a regu-
lated market is determined using valuation methods ap-
propriate for each type of financial instrument and market
data as of the close of the reporting period (such as inte-
rest rates, exchange rates, volatility), discounting expected
future cash flows on the basis of the market yield curve
and translating amounts in currencies other than the euro
using exchange rates provided by World Markets Refinitiv
(WMR) Company. For contracts involving commodities, the
measurement is conducted using prices, where available,
for the same instruments on both regulated and unregu-
lated markets.
In accordance with the new IFRS, in 2013 the Company
included a measurement of credit risk, both of the coun-
terparty (Credit Valuation Adjustment or CVA) and its own
(Debit Valuation Adjustment or DVA), in order to adjust the
fair value of financial instruments for the corresponding
amount of counterparty risk.
More specifically, the Company measures CVA/DVA using
a Potential Future Exposure valuation technique for the
net exposure of the position and subsequently allocating
the adjustment to the individual financial instruments that
make up the overall portfolio. All of the inputs used in this
technique are observable on the market. Changes in the
assumptions underlying the estimated inputs could have
an effect on the fair value reported for such instruments.
The notional amount of a derivative contract is the amount
on which cash flows are exchanged. This amount can be
expressed as a value or a quantity (for example tons, con-
verted into euros by multiplying the notional amount by the
agreed price).
Amounts denominated in currencies other than the euro
are translated into euros at the official exchange rates pro-
vided by World Markets Refinitiv (WMR) Company.
The notional amounts of derivatives reported here do not
necessarily represent amounts exchanged between the
parties and therefore are not a measure of the Company’s
credit risk exposure.
For listed debt instruments, the fair value is given by official
prices. For unlisted instruments the fair value is determi-
ned using appropriate valuation techniques for each cate-
gory of financial instrument and market data at the repor-
ting date, including the credit spreads of Enel.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
145Notes to the separate financial statements
35.1 Assets measured at fair value in the
statement of financial position
The following table shows, for each class of assets mea-
sured at fair value on a recurring or non-recurring basis in
the statement of financial position, the fair value measure-
ment at the end of the reporting period and the level in the
fair value hierarchy into which the fair value measurements
are categorized.
Millions of euro Non-current assets Current assets
Notes
Fair value
at Dec. 31,
2022 Level 1 Level 2 Level 3
Fair value
at Dec. 31,
2022 Level 1 Level 2 Level 3
Derivatives
Cash flow hedge derivatives:
- on interest rate risk 42 - 42 - - - - -
- on currency risk 34 108 - 108 - 234 - 234 -
Total cash flow hedges 150 - 150 - 234 - 234 -
Fair value through profit or loss:
- on interest rate risk 34 129 - 129 - - - - -
- on currency risk 34 70 - 70 - 156 - 156 -
Total fair value through profit
or loss
199 - 199 - 156 - 156 -
TOTAL 349 - 349 - 390 - 390 -
35.2 Liabilities measured at fair value in the
statement of financial position
The following table reports, for each class of liabilities me-
asured at fair value on a recurring or non-recurring basis in
the statement of financial position, the fair value measure-
ment at the end of the reporting period and the level in the
fair value hierarchy into which the fair value measurements
are categorized.
Millions of euro Non-current liabilities Current liabilities
Notes
Fair value
at Dec. 31,
2022 Level 1 Level 2 Level 3
Fair value
at Dec. 31,
2022 Level 1 Level 2 Level 3
Derivatives
Cash flow hedge derivatives:
- on interest rate risk 34 43 - 43 - - - - -
- on currency risk 34 423 - 423 - - - - -
Total cash flow hedges 466 - 466 - - - - -
Fair value through profit or loss:
- on interest rate risk 34 128 - 128 - 23 - 23 -
- on currency risk 34 69 - 69 - 155 - 155 -
Total fair value through profit
or loss
197 - 197 - 178 - 178 -
TOTAL 663 - 663 - 178 - 178 -
35.3 Liabilities not measured at fair value in
the statement of financial position
The following table shows, for each class of liabilities not
measured at fair value in the statement of financial posi-
tion but for which the fair value shall be disclosed, the fair
value at the end of the reporting period and the level in the
fair value hierarchy into which the fair value measurements
are categorized.
146 Report and financial statements of Enel SpA at December 31, 2022
Millions of euro LIABILITIES
Notes
Fair value at
Dec. 31, 2022 Level 1 Level 2 Level 3
Bonds:
- fixed rate 32.2.1 3,672 3,672 - -
- floating rate 32.2.1 823 62 761 -
Total 4,495 3,734 761 -
Bank borrowings:
- floating rate 32.2.1 1,548 - 1,548 -
Total 1,548 - 1,548 -
Non-bank financing:
- under fixed-rate leases 32.2.1 1 - 1 -
Total 1 - 1 -
Loans from Group companies:
- fixed rate 32.2.1 10,730 - 10,730 -
- floating rate 32.2.1 568 - 568 -
Total 11,298 - 11,298 -
TOTAL 17, 3 4 2 3,734 13,608 -
36. Share-based payments
Starting in 2019, the Shareholders’ Meeting of Enel SpA
(“Enel” or the “Company”) has each year approved the
adoption of long-term share-based incentive plans for the
management of Enel and/or its subsidiaries pursuant to
Article 2359 of the Civil Code. Each of the incentive plans
approved (the 2019 Long-Term Incentive Plan, the 2020
Long-Term Incentive Plan, the 2021 Long-Term Incentive
Plan and the 2022 Long-Term Incentive Plan; referred to
hereinafter, respectively, the “2019 LTI Plan”, the “2020 LTI
Plan”, the “2021 LTI Plan”, the “2022 LTI Plan” and, jointly, the
“Plans”) provides for the grant of ordinary Company sha-
res (“Shares”) to the respective beneficiaries subject to the
achievement of specific performance targets.
Plan beneficiaries are the Chief Executive Officer/General
Manager of Enel and Enel Group managers in the positions
most directly responsible for company performance or
considered to be of strategic interest. The Plans provide
for the award to the beneficiaries of an incentive consi-
sting of a monetary component and an equity component.
This incentive – determined, at the time of the award, as
a base value calculated in relation to the fixed remunera-
tion of the individual beneficiary – may vary depending on
the degree of achievement of each of the three-year per-
formance targets by the Plans, ranging from zero up to a
maximum of 280% or 180% of the base value in the case,
respectively, of the Chief Executive Officer/General Mana-
ger or the other beneficiaries.
The Plans establish that, of the total incentive effectively
vested, the bonus will be fully paid in Shares in the amount
of (i) up to 100% of the base value for the Chief Executive
Officer/General Manager (up to 130% for the 2022 LTI Plan),
and (ii) up to 50% of the base value for the other beneficia-
ries (up to 65% for the 2022 LTI Plan).
The actual award of the bonus under the Plans is subject
to the achievement of specific performance targets during
the three year performance period. If these targets are
achieved, 30% of both the stock and cash components of
the incentive are paid in the first year following the end of
the performance period and the remaining 70% will be paid
in second year following the end of the performance pe-
riod. The payment of a substantial portion of long-term va-
riable remuneration (70% of the total) is therefore deferred
to the second year following the end of the performance
period of the individual Plans.
The following table provides information on the 2019 LTI
Plan, the 2020 LTI Plan, the 2021 LTI Plan and the 2022 LTI
Plan.
For more information on the characteristics of the Plans,
please see the information documents prepared pursuant
to Article 84-bis of the CONSOB Regulation issued with
Resolution no. 11971 of May 14, 1999 (the Issuers Regu-
lation), which are available to the public in the section of
Enel’s website (www.enel.com) dedicated to the Sharehol-
ders’ Meetings held respectively on May 16, 2019, May 14,
2020, May 20, 2021 and May 19, 2022.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
147Notes to the separate financial statements
Grant date Performance period
Verification of
achievement of targets Payout
2019 LTI Plan 12.11.2019
(6)
2019-2021 2022
(7)
2022-2023
(8)
2020 LTI Plan 17.09.2020
(9)
2020-2022 2023
(10)
2023-2024
2021 LTI Plan 16.09.2021
(11)
2021-2023 2024
(12)
2024-2025
2022 LTI Plan 21.09.2022
(13)
2022-2024 2025
(14)
2025-2026
(6) The date on which the Board of Directors approved the procedures and timing for granting the 2019 LTI Plan to the beneficiaries (taking account of the
proposal issued by the Nomination and Compensation Committee at its meeting of November 11, 2019).
(7) On the occasion of the approval of the consolidated financial statements of the Enel Group at December 31, 2021, the Board of Directors verified the level
of achievement of the performance targets of the 2019 LTI Plan.
(8) On September 5, 2022 the Company awarded part of the equity component of the bonus vested by the beneficiaries of the 2019 LTI Plan, in accordance
with the Plan rules.
(9) The date on which the Board of Directors approved the procedures and timing for granting the 2020 LTI Plan to the beneficiaries (taking account of the
proposal issued by the Nomination and Compensation Committee at its meeting of September 16, 2020).
(10) On the occasion of the approval of the consolidated financial statements of the Enel Group at December 31, 2022, the Board of Directors will verify the level
of achievement of the performance targets of the 2020 LTI Plan.
(11) The date on which the Board of Directors approved the procedures and timing for granting the 2021 LTI Plan to the beneficiaries (taking account of the
proposal issued by the Nomination and Compensation Committee at its meeting of June 9, 2021).
(12) On the occasion of the approval of the consolidated financial statements of the Enel Group at December 31, 2023, the Board of Directors will verify the level
of achievement of the performance targets of the 2021 LTI Plan.
(13) The date on which the Board of Directors approved the procedures and timing for granting the 2022 LTI Plan to the beneficiaries (taking account of the
proposal issued by the Nomination and Compensation Committee at its meeting of June 8, 2022).
(14) On the occasion of the approval of the consolidated financial statements of the Enel Group at December 31, 2024, the Board of Directors will verify the level
of achievement of the performance targets of the 2022 LTI Plan.
(15) Shares purchase in the period between September 23 and December 2, 2019, equal to about 0.015% of share capital.
(16) Shares purchase in the period between September 3 and October 28, 2020, equal to about 0.017% of share capital.
(17) Shares purchase in the period between June 18 and July 21, 2021, equal to about 0.016% of share capital.
(18) Shares purchase in the period between June 17 and July 20, 2022, equal to about 0.026% of share capital.
In implementation of the authorizations granted by the
Shareholders’ Meetings held on May 16, 2019, May 14, 2020,
May 20, 2021 and May 19, 2022 and in compliance with the
associated terms and conditions, the Board of Directors
approved – at its meetings of September 19, 2019, July 29,
2020, June 17, 2021 and June 16, 2022 – the launch of share
buyback programs to serve the 2019 LTI Plan, the 2020 LTI
Plan, the 2021 LTI Plan and the 2022 LTI Plan, respectively.
The number of Shares whose purchase was authorized by
the Board of Directors for each Plan, the actual number of
Shares purchased, the associated weighted average price
and total value are shown below.
Purchases authorized by the Board
of Directors Actual purchases
Number of shares Number of shares
Weighted average price
(euros per share) Total value (euros)
2019 LTI Plan
No more than 2,500,000
for a maximum amount of
€10,500,000 million
1,549,152
(15)
6.7779 10,499,999
2020 LTI Plan 1,720,000 1,720,000
(16)
7.4366 12,790,870
2021 LTI Plan 1,620,000 1,620,000
(17)
7.8737 12,755,459
2022 LTI Plan 2,700,000 2,700,000
(18)
5.1951 14,026,715
As a result of the purchases made to support the 2019 LTI
Plan, the 2020 LTI Plan, the 2021 LTI Plan, and the 2022 LTI
Plan, and taking into account the award on September 5,
2022 of 435,357 shares to the beneficiaries of the 2019 LTI
Plan, at December 31, 2022 Enel holds a total of 7,153,795
treasury shares, equal to about 0.07% of share capital.
The following information concerns the equity instruments
granted in 2019, 2020, 2021 and 2022.
148 Report and financial statements of Enel SpA at December 31, 2022
2022 2021
Number of shares
granted at the
grant date
Fair value per share
at the grant date
Number of shares
potentially available
for award
Number of shares
awarded
Number of shares
potentially available
for award
Number of shares
awarded
2019 LTI Plan 1,538,547 6.983 1,021,328 435,357
(19)
1,529,182 -
2020 LTI Plan 1,638,775 7.380 1,631,951 - 1,638,775 -
2021 LTI Plan 1,577,773 7.0010 1,577,773 - 1,577,773 -
2022 LTI Plan 2,398,143 4.8495 2,395,323 - - -
(19) The table shows the number of shares awarded on September 5, 2022, to the beneficiaries of the 2019 LTI Plan, which make up the equity component of the
bonus vested by the beneficiaries following the achievement of the performance objectives of the Plan. The disbursement of the remaining portion of the equity
component of the bonus is deferred to 2023, in accordance with the terms and procedures of the rules of the 2019 LTI Plan.
(20) For the 2019 LTI Plan, the grant date is November 12, 2019, i.e., the date of the meeting of the Board of Directors that approved the procedures and timing
of the grant under the 2019 LTI Plan to the beneficiaries.
For the 2020 LTI Plan, the grant date is September 17, 2020, i.e., the date of the meeting of the Board of Directors that approved the procedures and timing
of the grant under the 2020 LTI Plan to the beneficiaries.
For the 2021 LTI Plan, the grant date is September 16, 2021, i.e., the date of the meeting of the Board of Directors that approved the procedures and timing
of the grant under the 2021 LTI Plan to the beneficiaries.
For the 2022 LTI Plan, the grant date is September 21, 2022 i.e., the date of the meeting of the Board of Directors that approved the procedures and timing
of the grant under the 2022 LTI Plan to the beneficiaries.
The fair value of those equity instruments is measured on
the basis of the market price of Enel Shares at the grant
date.
(20)
The cost of the equity component is determined on the ba-
sis of the fair value of the equity instruments granted and is
recognized over the duration of the vesting period through
an equity reserve.
The total costs recognized by the Group through profit or
loss amounted to €11 million in 2022 (€9 million in 2021).
There have been no terminations or amendments involving
the 2019 LTI Plan, the 2020 LTI Plan, the 2021 LTI Plan or the
2022 LTI Plan.
37. Related parties
Related parties have been identified on the basis of the pro-
visions of the IFRS and the applicable CONSOB measures.
The transactions Enel SpA entered into with its subsidiaries
mainly involved the provision of services, the sourcing and
employment of financial resources, insurance coverage,
human resource management and organization, legal and
corporate services, and the planning and coordination of
tax and administrative activities.
All the transactions are part of routine operations, are carri-
ed out in the interest of the Company and are settled on an
arm’s length basis, i.e., on the same market terms as agree-
ments entered into between two independent parties.
Finally, the Enel Group’s corporate governance rules, whi-
ch are discussed in greater detail in the Report on Cor-
porate Governance and Ownership Structure available on
the Company’s website (www.enel.com), establish condi-
tions for ensuring that transactions with related parties
are performed with transparency and procedural and
substantive propriety.
With regard to disclosures on the remuneration of direc-
tors, members of the Board of Statutory Auditors, the Ge-
neral Manager and key management personnel, provided
for under IAS 24, please see the following tables.
Millions of euro
2022 2021 Change
Remuneration of members of the Board of Directors and Board of
Statutory Auditors and the General Manager
Short-term employee benefits 5 5 - -
Other long-term benefits 1 1 - -
Total 6 6 - -
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
149Notes to the separate financial statements
Millions of euro
2022 2021 Change
Remuneration of key management personnel
Short-term employee benefits 13 13 - -
Other long-term benefits 2 4 (2) -50%
Total 15 17 (2) -11.8%
In November 2010, the Board of Directors of Enel SpA
approved a procedure governing the approval and exe-
cution of transactions with related parties carried out by
Enel SpA directly or through subsidiaries (the Enel Proce-
dure for Transactions with Related Parties). The procedure
(available at https://www.enel.com/investors/governance/
bylaws-rules-policies) sets out rules designed to ensure
the transparency and procedural and substantive pro-
priety of transactions with related parties. It was adopted
in implementation of the provisions of Article 2391-bis of
the Italian Civil Code and the implementing regulations is-
sued by CONSOB Resolution no. 17221 of March 12, 2010,
as amended (“CONSOB Regulation”).
Credit facility guaranteed by SACE -
Disclosure obligations established by Article
13, paragraph 3, letter c) (ii), of CONSOB
Regulation on transactions with related
parties
In compliance with the disclosure obligations established
under Article 13, paragraph 3, letter c) (ii), of CONSOB Re-
gulation no. 17221 of March 12, 2010, as amended (the
“CONSOB Regulation”), and Article 13.4, letter c) (ii), of the
Enel Procedure for Transactions with Related Parties (the
“Enel Procedure”), we hereby disclose that a transaction
with related parties was carried out in 2022 which qualifies
as a transaction of “greater importance” having an ordinary
nature and completed at market-equivalent or standard
terms. More specifically, on December 23, 2022, Enel SpA
signed with a pool of financial institutions – composed of
Banco BPM SpA, BPER Banca SpA, Cassa Depositi e Pre-
stiti SpA, Intesa Sanpaolo SpA and UniCredit SpA – a loan
agreement in the form of a revolving credit facility in the
amount of €12 billion, of which up to 70% of the nominal
amount is guaranteed by SACE SpA.
This credit facility, and the related guarantee, is aimed
at funding the collateral requirements of the Enel Group
companies operating in Italy (specifically Enel Global Tra-
ding SpA) for trading on energy markets and is part of the
temporary measures to support the liquidity of companies,
provided in the form of a guarantee, envisaged by Article
15 of Decree Law 50 of May 17, 2022, ratified with Law 91 of
July 15, 2022 (the so-called “Aid Decree Law”), as amended.
The overall transaction qualifies as a transaction with rela-
ted parties due to the fact that Enel SpA, Cassa Depositi e
Prestiti SpA and SACE SpA are companies under the com-
mon control of Italy’s Ministry for the Economy and Finan-
ce. Taking into account the amounts indicated above (and,
in particular, in consideration of the value of the guaran-
tee), it qualifies as a related-party transaction of “greater
importance”. The transaction in question was completed
applying the exemption pursuant to Article 13, paragraph
3, letter c), of the CONSOB Regulation and Article 13.4,
letter c), of the Enel Procedure, as an ordinary transaction
completed at market-equivalent or standard terms.
In particular, the transaction is connected with the ordinary
exercise of “finance activity connected to the operations”
of the Group headed by Enel SpA, taking into account, in-
ter alia, the object, recurrence and size of the same, as well
as the nature of the counterparties. Furthermore, the main
terms and conditions applicable to it are governed by Ar-
ticle 15 of the Aid Decree Law. For the portion of the loan
for which it is responsible, Cassa Depositi e Prestiti SpA
applied to Enel SpA the same terms and conditions that
are applied by the other banks.
*****
The following tables summarize commercial, financial and
other relationships between the Company and related parties.
150 Report and financial statements of Enel SpA at December 31, 2022
Commercial and other transactions
2022
Millions of euro
Costs Revenue
Trade receivables Trade payables Goods Services Goods Services
at Dec. 31, 2022 at Dec. 31, 2022 2022 2022
Subsidiaries, joint ventures and associates
Edistribución Redes Digitales SLU 8 1 - - - 7
e-distribuzione SpA 60 93 - - - 22
Empresa Distribuidora Sur SA - Edesur 1 - - - - -
Endesa Energía SA 2 - - - - 1
Endesa Generación SA 4 - - - - 3
Endesa Medios y Sistemas SLU 2 - - - - 2
Endesa Operaciones y Servicios Comerciales SLU 1 - - - - -
Endesa SA 13 1 - - - 7
Enel Américas SA 6 - - - - 1
Enel Brasil SA 93 1 - - - 27
Enel Chile SA 24 - - - - 3
Enel Colombia SA ESP 2 - - - - 1
Enel Distribución Chile SA 5 - - - - -
Enel Distribución Perú SAA 3 - - - - 2
Enel Energie SA 2 - - - - -
Enel Energia SpA 105 124 - - - 8
Enel Energie Muntenia SA 2 - - - - -
Enel Finance America LCC 2 - - - - -
Enel Generación Chile SA 5 - - - - -
Enel Generación Costanera SA 2 - - 2 - 2
Enel Generación Perú SA 2 - - - - 1
Enel Global Services Srl 12 78 - 83 - 1
Enel Global Thermal Generation Srl 1 1 - - - 1
Enel Global Trading SpA 5 15 - - - 1
Enel Green Power Chile SA 3 - - - - 1
Enel Green Power España SLU 3 - - - - 1
Enel Green Power Hellas SA 3 - - - - -
Enel Green Power India Private Limited 1 - - - - -
Enel Green Power Italia Srl 2 212 - - - 3
Enel Green Power North America Inc. 10 - - - - 6
Enel Green Power Romania Srl 1 1 - - - -
Enel Green Power Rus LLC 1 - - - - -
Enel Green Power SpA 9 8 - 3 - 3
Enel Grids Srl 4 50 - 3 - 1
Enel Iberia SRLU - 6 - 5 - -
Enel Innovation Hubs Srl - 5 - 5 - -
Enel Italia SpA 1 19 - 30 - -
Enel North America Inc. 4 1 - - - 2
Enel Produzione SpA 155 115 - - - 3
Enel Romania Srl 4 3 - - - 1
Enel Servicii Comune SA 2 - - - - -
Enel Sole Srl (1) 6 - - - -
Enel Trading Argentina Srl 1 - - - - 1
Enel X Brasil SA 1 - - - - -
Enel X Italia SpA 1 7 - - - 1
Enel X International Srl 9 - - - - -
Enel X Mobility Srl - 12 - - - -
Enel X North America Inc. 1 - - - - 1
Enel X Srl 3 21 - 2 - 6
Enel X Way Srl 4 4 - 1 - 4
Enel X Way Italia Srl - 6 - - - 1
E-Distribuţie Banat SA 7 - - - - 1
E-Distribuţie Dobrogea SA 3 - - - - -
E-Distribuţie Muntenia SA 10 - - - - 1
Gas y Electricidad Generación SAU 1 - - - - -
Gridspertise Srl
- 15 - - - -
Maicor Wind Srl 4 1 - - - -
Rusenergosbyt LLC 13 - - - - -
Servizio Elettrico Nazionale SpA 1 38 - - - 1
Slovenské elektrárne AS 13 - - - - 1
Società Elettrica Trigno Srl 1 - - - - -
Unión Eléctrica de Canarias Generación SAU (1) 1 - - - -
Vektör Enerjí Üretím AŞ 8 - - - - -
Total 644 845 - 134 - 129
Other related parties
Fondazione Centro Studi Enel 2 - - - - 2
Gestore dei Servizi Energetici SpA 1 - - - - -
Total 3 - - - - 2
TOTAL 647 845 - 134 - 131
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
151Notes to the separate financial statements
2021
Millions of euro
Costs Revenue
Trade receivables Trade payables Goods Services Goods Services
at Dec. 31, 2021 at Dec. 31, 2021 2021 2021
Subsidiaries, joint ventures and associates
Celg Distribuição SA 1 - - - - -
Central Geradora Termelétrica Fortaleza SA 1 - - - - -
Codensa SA ESP 1 - - - - 2
Edistribución Redes Digitales SLU 7 1 - - - 5
e-distribuzione SpA 102 49 - - - 25
Emgesa SA 1 - - - - 1
Empresa Distribuidora Sur SA - Edesur 1 - - - - 1
Endesa Energía SA 3 2 - - - 2
Endesa Generación SA 2 1 - - - 3
Endesa Medios y Sistemas SLU 1 - - - - 1
Endesa Operaciones y Servicios Comerciales SLU - - - - - 1
Endesa SA 10 1 - - - 7
Enel Américas SA 69 - - - - 1
Enel Brasil SA 69 1 - - - 27
Enel Chile SA 11 - - - - 3
Enel Distribución Chile SA 5 - - - - 2
Enel Distribución Perú SAA 3 - - - - 2
Enel Energia SA de Cv 1 - - - - 1
Enel Energia SpA 431 - - - - 8
Enel Energie Muntenia SA 1 - - - - 1
Enel Finance America LCC 2 - - - - -
Enel Generación Chile SA 4 - - - - 3
Enel Generación Costanera SA 1 - - - - -
Enel Generación Perú SA 2 - - - - 1
Enel Global Infrastructure and Networks Srl 7 22 - 19 - 4
Enel Global Services Srl 12 86 - 66 - 1
Enel Global Thermal Generation Srl - 3 - 1 - 1
Enel Global Trading SpA 5 9 - - - 1
Enel Green Power Chile SA 2 - - - - -
Enel Green Power España SLU 2 - - - - 1
Enel Green Power Hellas SA 2 - - - - -
Enel Green Power India Private Limited 1 - - - - -
Enel Green Power Italia Srl 4 9 - - - 4
Enel Green Power North America Inc. 5 - - - - 3
Enel Green Power Romania Srl 1 1 - - - -
Enel Green Power Rus LLC 1 - - - - -
Enel Green Power SpA 3 13 - 3 - 2
Enel Iberia SRLU 300 6 - 5 - -
Enel Innovation Hubs Srl - 4 - 6 - -
Enel Italia SpA 4 20 - 28 - 3
Enel North America Inc. 7 1 - - - 2
Enel Produzione SpA 59 62 - - - 4
Enel Romania Srl 4 3 - 3 - 1
PJSC Enel Russia 9 - - - - 2
Enel Servicii Comune SA 1 - - - - 1
Enel Sole Srl 1 4 - - - 1
Enel Trading Argentina Srl 1 - - - - -
Enel X Financial Services Srl - 4 - - - -
Enel X Italia SpA 11 3 - - - -
Enel X Mobility Srl - 3 - - - -
Enel X North America Inc. 1 - - - - -
Enel X Srl 5 3 - - - 5
Energía Nueva Energía Limpia México S de RL de Cv 1 - - - - -
E-Distribuţie Banat SA 6 - - - - -
E-Distribuţie Dobrogea SA 3 - - - - -
E-Distribuţie Muntenia SA
9 - - - - 1
Gas y Electricidad Generación SAU 2 - - - - -
Gridspertise Srl 4 - - - - -
Rusenergosbyt LLC 1 - - - - -
Servizio Elettrico Nazionale SpA 180 32 - - - 2
Slovenské elektrárne AS 13 - - - - 1
Società Elettrica Trigno Srl - 1 - - - -
Unión Eléctrica de Canarias Generación SAU 1 1 - - - -
Vektör Enerjí Üretím AŞ 8 - - - - -
Total
1,405 345 - 131 - 137
Other related parties
CESI SpA - - - - - 1
Fondazione Centro Studi Enel 2 - - - - 1
Gestore dei Servizi Energetici SpA 1 - - - - -
Total 3 - - - - 2
TOTAL
1,408 345 - 131 - 139
152 Report and financial statements of Enel SpA at December 31, 2022
Financial transactions
2022
Millions of euro Loan assets Borrowings Guarantees Costs Revenue Dividends
at Dec. 31, 2022 2022
Subsidiaries, joint ventures and associates
Concert Srl - 3 - - - -
e-distribuzione SpA - - 3,588 - 9 -
Eletropaulo Metropolitana Eletricidade de São Paulo SA - - 183 - - -
Endesa Generación SA - - 2,000 - - -
EnerNOC Ireland Limited - - 6 - - -
Enel Américas SA - - - - - 99
Enel Brasil SA 124 - 2,389 - 20 -
Enel Chile SA - - 289 - - 28
Enel Colombia SA ESP 2 - 291 - 1 -
Enel Energia SpA - - 483 - 1 -
Enel Energie SA - - - 1 - -
Enel Finance America LLC - - 4,887 - 2 -
Enel Finance International NV 2 21,096 57,737 326 84 -
Enel Global Services Srl 164 4 11 7 3 -
Enel Global Thermal Generation Srl 39 - 15 - 1 -
Enel Global Trading SpA 577 893 2,855 740 539 -
Enel Green Power Australia (Pty) Ltd 4 - 219 1 4 -
Enel Green Power Chile Ltda - - 1 - - -
Enel Green Power Colombia SAS - - - - 1 -
Enel Green Power Costa Rica SA - - 8 - - -
Enel Green Power Hellas SA - - 594 - 1 -
Enel Green Power India Private Limited - - - - 1 -
Enel Green Power Italia Srl - - 381 - 1 -
Enel Green Power Matimba NewCo 1 Srl - 1 - 2 - -
Enel Green Power México S de RL de Cv 80 - 700 - 11 -
Enel Green Power Partecipazioni Speciali Srl - - - 1 - -
Enel Green Power Perú SAC 11 3 384 12 9 -
Enel Green Power Romania Srl 1 - 114 - - -
Enel Green Power RSA (Pty) Ltd - - - - 3 -
Enel Green Power Rus LLC - - 50 - - -
Enel Green Power South Africa 45 - 666 - 3 -
Enel Green Power SpA 472 9 493 19 16 -
Enel Grids Srl 52 - 17 - 5 -
Enel Holding Finance Srl - 1 - - - -
Enel Iberia SRLU - - - - - 648
Enel Innovation Hubs Srl - 3 1 - - 16
Enel Insurance NV - 244 188 - 1 -
Enel Investment Holding BV - 1 - - - -
Enel Italia SpA 640 124 10,107 353 221 7,970
Enel North America Inc. 39 - 18,384 - 40 -
Enel Produzione SpA - - 1,219 - 1 -
Enel Sole Srl - - 259 - 1 -
Enel Trade Energy Srl 1 1 7 - 1 -
Enel X Australia (Pty) Ltd - - 5 - - -
Enel X International Srl - 9 - - 1 -
Enel X Italia Srl - - 14 - - -
Enel X Mobility Srl - - 45 - - -
Enel X North America Inc. 1 - 81 - 1 -
Enel X Polska Sp. zo.o. - - 14 - - -
Enel X Srl 737 - 1 - 11 -
Enel X UK Limited - - 18 - - -
Enel X Way Srl 104 - 11 5 1 -
Enel X Way Italia Srl 16 - 1 - - -
Enelpower Srl - 36 - - - -
Generadora Montecristo SA - - 2 - - -
Gridspertise Srl - - 9 8
6 -
Nuove Energie Srl 28 - 85 - 2 -
Parque Eólico Pampa SA 1 - - - - -
Rusenergosbyt LLC - - - - - 9
Servizio Elettrico Nazionale SpA - - 1,185 - 4 -
Tynemouth Energy Storage Limited - - - - 1 -
Total 3,140 22,428 109,997 1 ,475 1,007 8,770
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
153Notes to the separate financial statements
2021
Millions of euro Loan assets Borrowings Guarantees Costs Revenue Dividends
at Dec. 31, 2021 2021
Subsidiaries, joint ventures and associates
Concert Srl - 2 - - - -
e-distribuzione SpA - - 3,960 - 8 -
Enel Américas SA - - - - - 303
Enel Brasil SA 103 - 2,204 - 3 -
Enel Chile SA - - - - - 168
Enel Energia SpA - - 809 - 2 -
Enel Energie Muntenia SA - - - - - 6
Enel Energie SA - - - - - 2
Enel Finance America LLC - - 3,035 - 2 -
Enel Finance International NV 1 24,247 45,640 215 66 -
Enel Global Infrastructure and Networks Srl 300 - 7 - 1 -
Enel Global Services Srl 204 1 5 5 3 -
Enel Global Thermal Generation Srl 52 - 11 - 1 -
Enel Global Trading SpA 4,471 39 2,422 355 197 86
Enel Green Power Australia (Pty) Ltd 2 - 37 - 1 -
Enel Green Power Brasil Participações Ltda - - - - 18 -
Enel Green Power Chile Ltda - - 1 - - -
Enel Green Power Colombia SAS 2 - 315 - 2 -
Enel Green Power Costa Rica SA - - 8 - - -
Enel Green Power Development Srl 1 1 - 1 2 -
Enel Green Power Hellas SA - - 60 - 1 -
Enel Green Power India Private Limited - - 149 - 1 -
Enel Green Power Italia Srl - - 472 - 2 -
Enel Green Power México S de RL de Cv 68 - 964 4 25 -
Enel Green Power Panamá Srl - - 5 - - -
Enel Green Power Perú SAC 11 - 87 - 6 -
Enel Green Power Romania Srl 1 - 117 - - -
Enel Green Power RSA (Pty) Ltd 39 - 104 - 7 -
Enel Green Power Rus LLC - - - - 1 -
Enel Green Power South Africa - - 843 - - -
Enel Green Power SpA 254 - 555 13 14 -
Enel Holding Finance Srl - 1 - - - -
Enel Iberia SRLU - - - - - 1,175
Enel Innovation Hubs Srl - 21 1 - - -
Enel Insurance NV - 250 94 - - -
Enel Investment Holding BV - 2 - - - -
Enel Italia SpA 1 ,417 8 3,496 110 68 2,609
Enel North America Inc. 35 - 14,557 - 34 -
Enel Produzione SpA - - 651 - 1 -
Enel Rinnovabili Srl - - - - - 25
Enel Sole Srl - - 284 - 1 -
Enel Trade Energy Srl - - 4 - - -
Enel X Australia (Pty) Ltd - - 3 - - -
Enel X International Srl 47 - - - - -
Enel X Italia SpA - - 16 - - -
Enel X Mobility Srl - - 53 - - -
Enel X North America Inc. - - 36 - - -
Enel X Polska Sp. zo.o. - - 15 - - -
Enel X Srl 280 - 1 - 2 -
Enel X UK Limited - - 15 - - -
Enelpower SpA - 37 - - - -
EnerNOC Ireland Limited - - 5 - - -
E-Distribuţie Banat SA - - - - - 8
E-Distribuţie Muntenia SA - - - - - 27
Generadora Montecristo SA - - 2 - - -
Gridspertise Srl - 5 29 -
- -
Nuove Energie Srl 21 - 85 6 - -
Open Fiber SpA - - - - 1 -
Parque Eólico Pampa SA 1 - - - 15 -
PH Chucas SA - - - - - -
Rusenergosbyt LLC - - - - - 41
Servizio Elettrico Nazionale SpA - - 1,193 - 5 -
Total 7,310 24,614 82,350 709 490 4,450
154 Report and financial statements of Enel SpA at December 31, 2022
The impact of transactions with related parties on the sta-
tement of financial position, income statement and state-
ment of cash flows is reported in the following tables.
Impact on the statement of financial position
Millions of euro Total
Related
parties % of total Total
Related
parties % of total
at Dec. 31, 2022 at Dec. 31, 2021
Assets
Derivatives - non-current 349 35 10.0% 753 153 20.3%
Other non-current assets 81 69 85.2% 99 87 87.9%
Trade receivables 294 295 - 275 276 -
Derivatives - current 390 86 22.1% 60 23 38.3%
Other current financial assets 3,480 3,019 86.8% 8,257 7, 13 4 86.4%
Other current assets 584 283 48.5% 1,063 1,045 98.3%
Liabilities
Long-term borrowings 18,196 12,407 68.2% 25,572 18,739 73.3%
Derivatives - non-current 663 163 24.6% 1,300 26 2.0%
Other non-current liabilities 24 8 33.3% 30 8 26.7%
Short-term borrowings 8,752 8,362 95.5% 6,563 5,625 85.7%
Current portion of long-term borrowings 1,430 1,333 93.2% 216 118 54.6%
Trade payables 155 97 62.6% 167 117 70.1%
Derivatives - current 178 69 38.8% 131 37 28.2%
Other current financial liabilities 238 94 39.5% 227 71 31.3%
Other current liabilities 2,873 740 25.8% 2,785 220 7.9%
Impact on the income statement
Millions of euro Total
Related
parties % of total Total
Related
parties % of total
2022 2021
Revenue 133 131 98.5% 1,769 139 7.9%
Services and rentals and leases 206 133 64.6% 197 130 66.0%
Other operating expenses 27 1 3.7% 14 1 7. 1 %
Income from equity investments 8,770 8,770 - 4,451 4,450 -
Financial income from derivatives 2,131 627 29.4% 1,073 253 23.6%
Other financial income 432 380 88.0% 240 237 98.8%
Financial expense from derivatives 1,960 1,166 59.5% 891 506 56.8%
Other financial expense 787 309 39.3% 869 203 23.4%
Impact on cash flows
Millions of euro Total
Related
parties % of total Total
Related
parties % of total
2022 2021
Cash flows from/(used in) operating activities
(1)
8,689 1,594 18.3% 6,757 632 9.4%
Cash flows from/(used in) investing activities (1,647) (1,602) -97.3% (9,739) (9,669) -99.3%
Cash flows from/(used in) financing activities
(1)
(3,126) 1,757 -54.6% 1,807 3,088 -
(1) The figure for coupons paid to hybrid bond holders has been presented differently from that published in the separate financial statements for 2021.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
155Notes to the separate financial statements
38. Government grants – Disclosure pursuant to Article 1, paragraphs 125-129, of Law
124/2017
Pursuant to Article 1, paragraphs 125-129, of Law 124/2017
as amended, the following provides information on grants
received from Italian public agencies and bodies, as well as
donations by Enel SpA to companies, individuals and pu-
blic and private entities. The disclosure comprises: (i) gran-
ts received from Italian public entities/State entities; and
(ii) donations made by Enel SpA to public or private parties
resident or established in Italy.
The following disclosure includes payments in excess of
€10,000 made by the same grantor/donor during 2022,
even if made through multiple financial transactions. They
are recognized on a cash basis.
Pursuant to the provisions of Article 3-quater of Decree
Law 135 of December 14, 2018, ratified with Law 12 of Fe-
bruary 11, 2019, for grants received, please refer to the in-
formation contained in the National Register of State Aid
referred to in Article 52 of Law 234 of December 24, 2012.
As far as donations made are concerned, the material ca-
ses are listed below.
Euro
Beneficiary Amount Description of donation
FGS Onlus 50,000 Donation to promote equal opportunities
European University Institute 100,000
Donation for scientific research on European energy
issues
Fondazione Centro Studi Enel 100,000 Enel Foundation grant
Earthrise Trust 10,000 Donation for rural development projects
International Energy Agency 75,000 Donation for the study of the energy market
Comunità Sant’Egidio 43,856 Gadgets donation
Associazione UISP Unione Italiana Sport per Tutti 28,759 Gadgets donation
Onlus CESIE 59,594 Gadgets donation
Onlus Sport Senza Frontiere 16,816 Gadgets donation
Total 484,025
39. Contractual commitments and guarantees
Millions of euro
at Dec. 31, 2022 at Dec. 31, 2021 Change
Sureties and guarantees given:
- third parties 16 18 (2)
- subsidiaries 105,114 82,350 22,764
Total 105,130 82,368 22,762
Sureties granted to third parties essentially regard a bank
surety issued in favor of Banco Centroamericano de Inte-
gración Económica (BCIE) in an amount equivalent to €15
million, acquired following the merger of Enel South Ame-
rica Srl into Enel SpA in 2017.
Other sureties and guarantees issued on behalf of subsi-
diaries include:
• €50,492 million issued on behalf of Enel Finance Interna-
tional NV securing bonds issued in European and other
international markets;
• €23,664 million issued on behalf of various renewable
energy companies for the development of new projects
under the Business Plan;
• €7,245 million issued on behalf of Enel Finance Interna-
tional NV to back the euro commercial paper program;
• €4,313 million issued to the European Investment Bank
(EIB) for loans granted to e-distribuzione SpA, Enel Pro-
duzione SpA, Enel Italia SpA, Enel Green Power SpA, Enel
Chile SA, Enel Green Power Italia Srl, Enel Green Power
Perú SAC, Eletropaulo Metropolitana Eletricidade de São
Paulo SA, Enel Sole Srl and Enel X Mobility Srl;
• €4,887 million on behalf of the US company Enel Finance
America LLC to secure the commercial paper and bond
issue program on the US market;
• €1,407 million in favor of Cassa Depositi e Prestiti issued
on behalf of e-distribuzione SpA, which received the
Enel Grid Efficiency II loan;
• €1,150 million issued by Enel SpA to the Single Buyer on
behalf of Servizio Elettrico Nazionale for obligations un-
der the electricity purchase contract;
• €897 million issued to INPS on behalf of various Group
156 Report and financial statements of Enel SpA at December 31, 2022
companies whose employees elected to participate in the
structural staff reduction plan (Article 4 of Law 92/2012);
• €1,730 million as counter-guarantees in favor of the
banks that guaranteed the Energy Markets Operator on
behalf of Enel Global Trading SpA and Enel Produzione
SpA;
• €1,077 million issued to Terna on behalf of e-distribuzio-
ne, Enel Global Trading SpA, Enel Produzione SpA, Enel
X Italia Srl, Enel Green Power Italia Srl, Enel Energia SpA
and Enel Global Thermal Generation Srl, in respect of
agreements for electricity transmission services;
• €569 million issued to Snam Rete Gas on behalf of Enel
Global Trading SpA, Enel X Italia Srl, Enel Produzione SpA,
Enel Energia SpA and Nuove Energie Srl for gas transport
capacity;
• €67 million issued to the tax authorities to secure parti-
cipation in the Group VAT mechanism on behalf of Enel
Produzione SpA;
• €50 million issued to RWE Supply & Trading GmbH on
behalf of Enel Global Trading SpA for electricity purcha-
ses;
• €50 million issued to E.ON Energy Trading on behalf of
Enel Global Trading SpA for trading on the electricity
market;
• €36 million issued on behalf of Enel Italia SpA to Excel-
sia Nove for the performance of obligations under rental
contracts;
• €7,480 million issued to various beneficiaries as part of
financial support activities by the Parent on behalf of
subsidiaries.
Compared with December 31, 2021, the increase in other
sureties and guarantees issued on behalf of subsidiaries is
mainly attributable to the issue of bonds as part of the Enel
Group’s financing strategy and the refinancing strategy for
consolidated debt, as well as developments in the exchan-
ge rate of the euro against the dollar for guarantees in this
currency.
Specifically, in 2022 Enel Finance International NV placed
in the Eurobond market two sustainability-linked bonds (a
triple-tranche €2.75 billion sustainability-linked bond and
a €1 billion sustainability-linked bond, respectively) and
in the US and international markets, a pound sterling su-
stainability-linked bond in a single tranche for institutional
investors for a total of £750 million (equal to €900 million)
and a multi-tranche sustainability-linked bond for $3.5 bil-
lion (equal to about €3.3 billion), all guaranteed by Enel SpA.
The issues are linked to the achievement of Enel’s sustai-
nability objective relating to the reduction of direct gre-
enhouse gas emissions (Scope 1), contributing to United
Nations Sustainable Development Goal (SDG) 13 (“Climate
Action”) and in line with the Group’s Sustainability-Linked
Financing Framework.
In line with the Strategic Plan, the new sustainability-linked
bond multi-tranche issues contribute to the achievement
of the Group’s objectives related to sustainable finance
sources on Group’s total gross debt, set at around 65% in
2024 and over 70% in 2030.
In its capacity as the Parent, Enel SpA has also granted let-
ters of patronage to a number of Group companies, es-
sentially for assignments of receivables.
40. Contingent assets and liabilities
Enel, Enel Energia and Servizio Elettrico
Nazionale antitrust proceeding - Italy
On May 11, 2017, the Competition Authority announced
the beginning of proceedings for alleged abuse of a domi-
nant position against Enel SpA (Enel), Enel Energia SpA (EE)
and Servizio Elettrico Nazionale SpA (SEN), with the con-
comitant performance of inspections. The proceeding was
initiated on the basis of complaints filed by the Italian As-
sociation of Energy Wholesalers and Traders (AIGET) and
the company Green Network SpA (GN), as well as a number
of individual consumers.
On December 20, 2018 the Competition Authority issued
its final ruling, with which it levied a fine on the three com-
panies of about €93 million, for violation of Article 102
of the Treaty on the Functioning of the European Union
(TFEU).
The main disputed conduct consisted in abuse of a do-
minant position by the three companies (to the benefit in
particular of EE) who allegedly used the privacy consent
given by SEN consumers, to the detriment of competing
traders. With regard to other allegations made with the
measure to initiate the proceeding, concerning the sales
activities at physical locations (Enel Points and Enel Point
Partner Shops) and winback policies reported by GN, the
Competition Authority reached the conclusion that the
preliminary findings did not provide sufficient evidence of
any abusive conduct on the part of Enel Group companies.
The companies involved challenged the measures of the
Competition Authority before the Lazio Regional Admini-
strative Court which, on October 17, 2019, partially upheld
the appeals filed by SEN and EE, shortening the period of
abuse and requiring the Competition Authority to recalcu-
late the penalty in accordance with the criteria specified
in the ruling. With a measure dated November 27, 2019,
the Competition Authority set the recalculated penalty at
€27,529,786.46.
The rulings of the Regional Administrative Court were
challenged on appeal before the Council of State which,
with an order of July 20, 2020, suspended the ruling and
ordered that the issue be submitted for a preliminary ruling
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
157Notes to the separate financial statements
before the Court of Justice of the European Union (CJEU)
pursuant to Article 267 of the TFEU, formulating a number
of questions aimed at clarifying the interpretation of the
concept of “abuse of a dominant position” to be applied to
the present case.
With a ruling of May 12, 2022, the CJEU provided the re-
quested interpretation and, subsequently, on December 1,
2022, the Council of State, in application of the guidelines
set out by the CJEU, fully voided the fine levied by the Com-
petition Authority and, upholding the arguments presen-
ted by the companies, denied that any abuse of position
had occurred.
BEG litigation - Italy, France, the Netherlands,
Luxembourg
Following an arbitration proceeding initiated by BEG SpA
(BEG) in Italy, Enelpower SpA (Enelpower) obtained a ru-
ling in its favor in 2002, which was upheld by the Court of
Cassation in 2010, which entirely rejected the petition for
damages with regard to alleged breach by Enelpower of an
agreement concerning the construction of a hydroelectric
power station in Albania. Subsequently, BEG, acting throu-
gh its subsidiary Albania BEG Ambient Shpk (ABA), filed suit
against Enelpower and Enel SpA (Enel) in Albania concer-
ning the matter, obtaining a ruling from the District Court
of Tirana on March 24, 2009, upheld by the Albanian Court
of Cassation, ordering Enelpower and Enel to pay tortious
damages of about €25 million for 2004 as well as an un-
specified amount of tortious damages for subsequent ye-
ars. Following the ruling, Albania BEG Ambient demanded
payment of more than €430 million.
On November 5, 2016, Enel and Enelpower filed a petition
with the Albanian Court of Cassation, asking for the ruling
issued by the District Court of Tirana on March 24, 2009 to
be voided. The proceeding is still pending.
With a ruling of the Court of Appeal of Rome of March
7, 2022, the further proceedings undertaken by Enel and
Enelpower before the Court of Rome were concluded,
having sought recognition of BEG’s liability for having cir-
cumvented the arbitration award rendered in Italy in favor
of Enelpower through the aforementioned initiatives un-
dertaken by the subsidiary ABA. With the ruling, the Court
of Appeal of Rome upheld the ruling of first instance ren-
dered by the Court of Rome on June 16, 2015, which had
denied the petition in the proceeding.
On May 20, 2021, the European Court of Human Rights
(ECHR) issued a ruling with which it decided the appeal
brought by BEG against the Italian State for violation of
Article 6.1 of the European Convention on Human Rights.
With this decision, the Court denied BEG’s request to re-
open the above arbitration proceedings, and also rejected
BEG’s claim for pecuniary damages amounting to about
€1.2 billion due to the absence of a causal link with the
disputed conduct, granting it only €15,000.00 in non-pe-
cuniary damages.
Nonetheless, on December 29, 2021, BEG, with an action
that the company and its legal counsel deemed unfoun-
ded and specious, also decided to sue the Italian State be-
fore the Court of Milan, to demand, as a consequence of
the ECHR ruling, damages for tortious liability in an amount
of about €1.8 billion. In this case, BEG also involved Enel
and Enelpower by way of a claim of joint and several liabili-
ty. With an order of June 14, 2022, the Court of Milan, in ac-
cepting the objection of territorial incompetence raised by
the State Attorney, declared its incompetence to hear the
dispute in favor of the Court of Rome, the court exclusively
competent to hear the causes in which the Italian State is
involved, ordering BEG to pay the costs of the proceedings
in favor of the defendants. BEG did not resume the judg-
ment before the Court of Rome within the legal term of 14
October 2022 and therefore the proceeding was extingui-
shed.
A short time later, on November 3, 2022, BEG resubmit-
ted the same claims for damages of the terminated pro-
ceeding, serving a new writ of summons before the Court
of Milan against the same defendants, with the exception
of the Italian State, which BEG declared not to wishing to
agree to this judgement. The first appearance hearing is
set for May 9, 2023. The Company is preparing its defenses
to proceed with the appearance in court in order to con-
test the claim, which is considered entirely specious and
unfounded, like the previous similar initiative.
Proceedings undertaken by Albania BEG
Ambient Shpk (ABA) to obtain enforcement
of the ruling of the District Court of Tirana of
March 24, 2009
France
In February 2012, ABA filed suit against Enel and Enelpower
with the Tribunal de Grande Instance in Paris in order to
render the ruling of the Albanian court enforceable in Fran-
ce. Enel SpA and Enelpower SpA challenged the suit.
Following the beginning of the case before the Tribunal de
Grande Instance, between 2012 and 2013 Enel France was
served with a number of “Saisie Conservatoire de Créanc-
es” (orders for the precautionary attachment of recei-
vables) in favor of ABA to conserve any receivables of Enel
in respect of Enel France.
On January 29, 2018, the Tribunal de Grande Instance is-
sued a ruling in favor of Enel and Enelpower, denying ABA
the recognition and enforcement of the Tirana court’s ru-
ling in France for lack of the requirements under French
law for the purposes of granting exequatur. Among other
issues, the Tribunal de Grande Instance ruled that: (i) the
Albanian ruling conflicted with an existing decision (the
arbitration ruling of 2002) and that (ii) the fact that BEG
sought to obtain in Albania what it was not able to obtain in
the Italian arbitration proceeding, resubmitting the same
claim through ABA, represented fraud.
158 Report and financial statements of Enel SpA at December 31, 2022
Subsequently, with a ruling of May 4, 2021, the Paris Court
of Appeal denied the appeal by ABA in full, fully upholding
the non-compatibility of the Albanian ruling with the ar-
bitration award of 2002 determined by the TGI, ordering
it to reimburse Enel and Enelpower €200,000.00 each for
legal costs.
On June 21, 2021, ABA filed an appeal with the Cour de
Cassation against the ruling of the Paris Court of Appeal.
Enel and Enelpower have appeared in court and the hea-
ring for the final discussion of the case is set for March 28,
2023.
Enel initiated a separate proceeding to obtain release of
the precautionary attachments granted to ABA and which
are no longer valid as a result of the appeal ruling. With
an order of June 16, 2022, the Court of Paris ordered the
release of the precautionary attachments while also orde-
ring ABA to pay Enel a total of about €146,000 in dama-
ges and legal costs. ABA challenged the aforementioned
release order, requesting its suspension as a precautionary
measure. The request for precautionary suspension was
rejected on November 23, 2022 and the appeal continues
in the trial court. At the same time, Enel is taking the ne-
cessary actions for credit recovery.
The Netherlands
At the end of July 2014, ABA filed suit with the Court of Am-
sterdam to render the ruling of the Albanian court enforce-
able in the Netherlands.
Following an initial ruling of June 29, 2016, in favor of ABA,
in a ruling of July 17, 2018, the Amsterdam Court of Appeal
upheld the appeal advanced by Enel and Enelpower, ruling
that the Albanian judgment cannot be recognized and en-
forced in the Netherlands, as it was arbitrary and manife-
stly unreasonable and therefore contrary to Dutch public
order. Subsequently, the proceeding before the Court of
Appeal continued with regard to the subordinate question
raised by ABA with which it asked the Dutch court to rule
on the merits of the dispute in Albania and in particular the
alleged tortious liability of Enel and Enelpower in the failure
to build the power plant in Albania. On December 3, 2019,
the Amsterdam Court of Appeal issued a definitive ruling in
which it fully quashed the trial court judgment of June 29,
2016, rejecting any claim made by ABA, thereby confirming
the denial of recognition and enforcement of the Albanian
ruling in the Netherlands. The Court came to this conclu-
sion after affirming its jurisdiction over ABA’s subordinate
claim and re-analyzing the merits of the case under Alba-
nian law, finding no tortious liability on the part of Enel and
Enelpower. As a result of the decision of the Court of Ap-
peal, Enel and Enelpower are therefore not liable to pay any
amount to ABA, which was in fact ordered by the Court of
Appeal to reimburse the companies for the losses incur-
red in illegitimate conservative seizures, to be quantified as
part of a specific procedure, and the costs of the trial and
appeal proceedings.
On July 16, 2021 the Supreme Court completely rejected
ABA’s appeal of the rulings of the Court of Appeal, ordering
it to reimburse court costs. The decision of the Court of
Appeal has thus become final.
Luxembourg
In Luxembourg, again at the initiative of ABA, J.P. Morgan
Bank Luxembourg SA was also served with an order for
a number of precautionary seizures of any receivables of
both Enel Group companies in respect of the bank.
In parallel ABA filed a claim to obtain enforcement of the
ruling of the Court of Tirana in Luxembourg. Owing to a
number of procedural delays, the proceeding is still in the
initial stages and no ruling has been issued.
United States and Ireland
In 2014, ABA had initiated two proceedings requesting
execution of the Albanian sentence before the courts of
the State of New York and Ireland, which both ruled in fa-
vor of Enel and Enelpower, respectively, on February 23
and February 26, 2018. Accordingly, there are no lawsuits
pending in Ireland or New York State.
Kino arbitration - Mexico
On September 16, 2020, Kino Contractor SA de Cv (Kino
Contractor), Kino Facilities Manager SA de Cv (Kino Facili-
ties) and Enel SpA (Enel) were notified of a request for arbi-
tration filed by Parque Solar Don José SA de Cv, Villanueva
Solar SA de Cv and Parque Solar Villanueva Tres SA de Cv
(together, “Project Companies”) in which the Project Com-
panies alleged the violation (i) by Kino Contractor of certain
provisions of the EPC Contract and (ii) by Kino Facilities of
certain provisions of the Asset Management Agreement,
both contracts concerning solar projects owned by the
three companies filing for arbitration.
Enel – which is the guarantor of the obligations assumed
by Kino Contractor and Kino Facilities under the above
contracts – has also been called into the arbitration pro-
ceeding, but no specific claims have been filed against it.
The Project Companies, in which Enel Green Power SpA
is a non-controlling shareholder, are controlled by CDPQ
Infraestructura Participación SA de Cv (which is controlled
by Caisse de Dépôt et Placement du Québec) and CKD In-
fraestructura México SA de Cv. After the request for ar-
bitration and the related response from the defendants,
the parties exchanged further introductory briefs, in whi-
ch the financial claim of the counterparties was updated
to $135 million, while Kino Facilities has not continued its
counter-claim. The hearing was held in October 2022 and
the final phase is currently pending. The issuance of the
arbitration award is expected by mid-2023.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
159Notes to the separate financial statements
41. Future accounting standards
(21) In July 2020, an amendment was issued to postpone the date of entry into force from January 1, 2023 to January 1, 2024.
The following provides a list of accounting standards,
amendments and interpretations that will take effect for
the Company after December 31, 2022.
• “Amendments to IAS 1 - Classification of Liabilities as
Current or Non-current”, issued in January 2020. The
amendments regard the provisions of IAS 1 concern-
ing the presentation of liabilities. More specifically, the
changes clarify:
– the criteria to adopt in classifying a liability as current
or non-current, specifying the meaning of right of an
entity to defer settlement and that that right must
exist at the end of the reporting period;
– that the classification is unaffected by the intentions
or expectations of management about when the en-
tity will exercise its right to defer settlement of a lia-
bility;
– that the right to defer exists if and only if the entity
satisfies the terms of the loan at the end of the repor-
ting period, even if the creditor does not verify com-
pliance until later; and
– that settlement regards the transfer to the counter-
party of cash, equity instruments, other assets or ser-
vices.
The amendments will take effect, subject to endorse-
ment, for annual periods beginning on or after January
1, 2024.
(21)
• “Amendments to IAS 1 - Non-current Liabilities with Cov-
enants”, issued in October 2022. IAS 1 requires classifi-
cation of liabilities as non-current only where an entity
has a right to defer settlement in the 12 months following
the reporting date. The amendments of the standard im-
prove disclosure when the right to defer settlement of a
liability for at least 12 months is subject to compliance
with covenants and specify that the classification of the
liability as current or non-current at the reporting date
is not affected by covenants that must be complied with
subsequent to the reporting date.
The amendments will take effect, subject to endorse-
ment, for annual periods beginning on or after January
1, 2024.
• “Amendments to IAS 1 and IFRS Practice Statement 2
- Disclosure of Accounting Policies”, issued in February
2021. The amendments are intended to support entities
in deciding which accounting policies to disclose in the
financial statements. The amendments to IAS 1 require
to disclose their material accounting policy information
rather than their significant accounting policies. A guide
on how to apply the concept of materiality to disclosures
on accounting policies is provided in the amendments
to IFRS Practice Statement 2. The amendments will take
effect for annual periods beginning on or after January
1, 2023.
• “Amendments to IAS 8 - Definition of Accounting Esti-
mates”, issued in February 2021. The amendments clarify
how companies should distinguish changes in accoun-
ting policies from changes in accounting estimates.
The definition of changes in accounting estimates has
been replaced with a definition of accounting estimates
as “monetary amounts in financial statements that are
subject to measurement uncertainty”. The amendments
will take effect for annual periods beginning on or after
January 1, 2023.
• “Amendments to IAS 12 - Income Taxes: Deferred Tax
related to Assets and Liabilities arising from a Single
Transaction”, issued in May 2021. The amendments re-
quire entities to recognize deferred tax on transactions
that at initial recognition give rise to equal taxable and
deductible temporary differences. The amendments will
take effect for annual periods beginning on or after Jan-
uary 1, 2023.
• “Amendments to IFRS 10 and IAS 28 - Sale or Contri-
bution of Assets between an Investor and its Associ-
ate or Joint Venture”, issued in September 2014. The
amendments clarify the accounting treatment for sales
or contribution of assets between an investor and its
associates or joint ventures. They confirm that the ac-
counting treatment depends on whether the assets sold
or contributed to an associate or joint venture constitute
a ‘business’ (as defined in IFRS 3). The IASB has deferred
the effective date of these amendments indefinitely.
• “IFRS 17 - Insurance Contracts”, issued in May 2017. The
standard will take effect for annual periods beginning on
or after January 1, 2023.
• “Amendments to IFRS 16 - Lease Liability in a Sale and
Leaseback”, issued in September 2022. The amend-
ments require the seller-lessee to measure the right-of-
use asset arising from a sale and leaseback transaction
in proportion to the previous carrying amount of the as-
set involved in the arrangement and in line with the re-
tained right-of-use. Consequently, the seller-lessee will
be allowed to recognize only the amount of any capital
gain or loss relating to the rights transferred to the buy-
er-lessor.
The amendments do not prescribe specific measure-
ment requirements for liabilities deriving from a lease-
back. However, they include examples that illustrate the
initial and subsequent measurement of the liability by in-
cluding variable payments that do not depend on an in-
160 Report and financial statements of Enel SpA at December 31, 2022
dex or a rate. This representation is a departure from the
general accounting model required by IFRS 16, in which
variable payments that do not depend on an index or a
rate are recognized through profit or loss in the period in
which the event or condition that determines these pay-
ments occurs. In this regard, the seller-lessee will have
to develop and apply an accounting policy to determine
the lease payments such that any amount of retained ri-
ght-of-use gain or loss is not recognized.
The amendments will take effect, subject to endorse-
ment, for annual periods beginning January 1, 2024. In
conformity with “IAS 8 - Accounting Policies, Changes in
Accounting Estimates and Errors“, retrospective applica-
tion is permitted for sale and leaseback transactions en-
tered into after the date of initial application of IFRS 16.
The Group is assessing the potential impact of the future
application of the new provisions.
42. Events after the reporting period
Enel places new perpetual hybrid bonds
for €1.75 billion to refinance some of its
outstanding hybrid bonds
On January 9, 2023, Enel SpA launched the issuance of
non-convertible, subordinated, perpetual, hybrid bonds
for institutional investors on the European market, deno-
minated in euros for an aggregate principal amount of
€1.75 billion (the “New Securities”).
The issuance is carried out in execution of the resolution of
the Company’s Board of Directors of December 14, 2022,
which authorized Enel to issue, by December 31, 2023, one
or more non-convertible subordinated hybrid bonds, in-
cluding perpetual bonds, in an overall maximum amount
of up to €2 billion.
The new issuance is structured in the following two series:
• €1,000-million non-convertible, subordinated, per-
petual, hybrid bond, with no fixed maturity, due and
payable only in the event of winding up or liquidation of
the Company, as specified in the terms and conditions
of the bond;
• €750-million non-convertible, subordinated, perpetual,
hybrid bond, with no fixed maturity, due and payable only
in the event of winding up or liquidation of the Company,
as specified in the terms and conditions of the bond.
The New Securities will be listed on the regulated market
of the Irish Stock Exchange trading as Euronext Dublin.
It is also expected that the rating agencies will assign to
the New Securities a rating of Baa3/BBB-/BBB- (Moo-
dy’s/S&P’s/Fitch) and an equity content of 50%.
At the same time, Enel also announced the launch of volun-
tary tender offers to repurchase for cash and subsequently
cancel, for a total aggregate principal amount equal to the
principal amount raised from the New Securities, two out-
standing series of hybrid bonds, namely:
i. any-and-all of the €750-million equity-accounted per-
petual hybrid bond with first call date in August 2023
and 2.500% coupon;
ii. the $1,250-million hybrid bond due September 2073
with call date in September 2023, and 8.750% coupon.
The overall transaction is intended to refinance the two
abovementioned hybrid bonds and is in line with Enel’s fi-
nancial strategy set out in the 2023-2025 Strategic Plan,
reaffirming the Group’s commitment to maintain hybrid
bonds as a permanent layer in its capital structure.
Results of the tender offer on the perpetual
hybrid bond denominated in euros and
removal of the Capped Maximum Amount for
the concurrent tender offer on the US dollar-
denominated hybrid bond
With the conclusion of the voluntary tender offer launched
on January 9, on January 18, 2023, Enel announced that it
will repurchase for cash its outstanding perpetual hybrid
bond denominated in euros for an aggregate nominal
amount of €699,970,000.00.
The settlement of the repurchase transaction took place
on January 20, 2023.
Subsequently, having met the conditions envisaged in the
“clean-up call” clause, which provided for the possibility
of repurchasing the remainder of the bond on exceeding
80% of the tender offer, on February 27, 2023 the settle-
ment for €50,049,000.00 took place, with full repayment
of the bond issue.
Following the tenders received by the Early Tender Deadli-
ne of January 23, 2023, and as a consequence of the remo-
val of the capped maximum acceptance amount (“Capped
Maximum Amount”) on the USD securities, as announced
on January 18, 2023, Enel accepted for purchase all of the
validly tendered USD securities for a total nominal amount
of $411,060,000, and settlement date January 26, 2023.
On February 10, 2023 an additional settlement of
€5,090,278.00 was carried out.
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
161Notes to the separate financial statements
43. Fees of the Audit Firm pursuant to Article 149-duodecies of the CONSOB Issuers
Regulation
Fees pertaining to 2022 paid by Enel SpA and its subsidia-
ries at December 31, 2022 to the Audit Firm and entities
belonging to its network for services are summarized in
the following table, pursuant to the provisions of Article
149-duodecies of the CONSOB Issuers Regulation.
Type of service Entity providing the service Fees (millions of euro)
Enel SpA
Auditing
of which:
- KPMG SpA 0.5
- entities of KPMG network -
Certification services
of which:
- KPMG SpA 2.1
- entities of KPMG network -
Other services
of which:
- KPMG SpA -
- entities of KPMG network -
Total 2.6
Enel SpA subsidiaries
Auditing
of which:
- KPMG SpA 4.3
- entities of KPMG network 7.9
Certification services
of which:
- KPMG SpA 1.3
- entities of KPMG network 1.1
Other services
of which:
- KPMG SpA 0.1
- entities of KPMG network -
Total 14.7
TOTAL 17.3
162 Report and financial statements of Enel SpA at December 31, 2022
Declaration of the Chief Executive Officer and the officer in charge of
financial reporting of Enel SpA at December 31, 2022, pursuant to the
provisions of Article 154-bis, paragraph 5, of Legislative Decree 58 of
February 24, 1998 and Article 81-ter of CONSOB Regulation no. 11971
of May 14, 1999
1. The undersigned Francesco Starace and Alberto De
Paoli, in their respective capacities as Chief Executive
Officer and officer responsible for the preparation of
the financial reports of Enel SpA, hereby certify, taking
account of the provisions of Article 154-bis, paragraphs
3 and 4, of Legislative Decree 58 of February 24, 1998:
a. the appropriateness with respect to the characteristics
of the Company and
b. the effective adoption of the administrative and ac-
counting procedures for the preparation of the separa-
te financial statements of Enel SpA in the period betwe-
en January 1, 2022 and December 31, 2022.
2. In this regard, we report that:
a. the appropriateness of the administrative and accoun-
ting procedures used in the preparation of the separate
financial statements of Enel SpA has been verified in an
assessment of the internal control system for financial
reporting. The assessment was carried out on the ba-
sis of the guidelines set out in the “Internal Controls
- Integrated Framework” issued by the Committee of
Sponsoring Organizations of the Treadway Commission
(COSO);
b. the assessment of the internal control system for finan-
cial reporting did not identify any material issues.
3. In addition, we certify that separate financial statements
of Enel SpA at December 31, 2022:
a. have been prepared in compliance with the
International Financial Reporting Standards recognized
in the European Union pursuant to Regulation (EC)
no. 1606/2002 of the European Parliament and of the
Council of July 19, 2002;
b. correspond to the information in the books and other
accounting records;
c. provide a true and fair representation of the financial
position, financial performance and cash flows of the
issuer.
4. Finally, we certify that the Report on Operations accom-
panying the separate financial statements of Enel SpA
at December 31, 2022 contains a reliable analysis of
operations and performance, as well as the situation of
the issuer, together with a description of the main risks
and uncertainties to which it is exposed.
Rome, March 16, 2023
Francesco Starace
Chief Executive Officer of Enel SpA
Alberto De Paoli
Officer in charge of financial
reporting of Enel SpA
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
163Notes to the separate financial statements
4.
164 Report and financial statements of Enel SpA at December 31, 2022
4.
Reports
3
Separate financial statements
2
Corporate governance
4
Reports
1
Report on Operations
165
Report of the Board of Statutory
Auditors to the Shareholders’ Meeting
of Enel SpA (pursuant to Article 153 of
Legislative Decree 58/1998)
166 Report and financial statements of Enel SpA at December 31, 2022
1
REPORT OF THE BOARD OF STATUTORY AUDITORS TO THE SHAREHOLDERS’ MEETING
OF ENEL SpA CALLED TO APPROVE THE FINANCIAL STATEMENTS FOR 2022
(pursuant to Article 153 of Legislative Decree 58/1998 )
Shareholders,
The current Board of Statutory Auditors of Enel SpA (hereinafter also “Enel” or the
“Company”) was appointed by the Shareholders’ Meeting of May 19, 2022.
During the year ended December 31, 2022 we performed the oversight activities envisaged
by law at Enel SpA (hereinafter also “Enel” or the “Company”). In particular, pursuant to
the provisions of Article 149, paragraph 1, of Legislative Decree 58 of February 24, 1998
(hereinafter the “Consolidated Law on Financial Intermediation”) and Article 19, paragraph
1 of Legislative Decree 39 of January 27, 2010 (hereinafter “Decree 39/2010”), we
monitored:
- compliance with the law and the corporate bylaws as well as compliance with the
principles of sound administration in the performance of the Company’s business;
- the Company’s financial reporting process and the adequacy of the administrative and
accounting system, as well as the reliability of the latter in representing operational
events;
- the statutory audit of the annual statutory and consolidated accounts and the
independence of the Audit Firm;
- the adequacy and effectiveness of the internal control and risk management system;
- the adequacy of the organizational structure of the Company, within the scope of our
responsibilities;
- the implementation of the corporate governance rules as provided for by the 2020
edition of the Italian Corporate Governance Code (hereinafter, the “Corporate
Governance Code”);
- the appropriateness of the instructions given by the Company to its subsidiaries to
enable Enel to meet statutory public disclosure requirements.
In performing our checks and assessments of the above issues, we did not find any issues
that would merit reporting here.
In compliance with the instructions issued by CONSOB with Communication no.
DEM/1025564 of April 6, 2001, as amended, we report the following:
• we monitored compliance with the law and the bylaws and we have no issues to report;
• on a quarterly basis, we received adequate information from the Chief Executive
Officer, as well as through our participation in the meetings of the Board of Directors
of Enel, on activities performed, general developments in operations and the outlook,
167
2
and on transactions with the most significant impact on performance or the financial
position carried out by the Company and its subsidiaries. The actions approved and
implemented appeared to be in compliance with the law and the bylaws and were not
manifestly imprudent, risky, in potential conflict of interest or in contrast with the
resolutions of the Shareholders’ Meeting or otherwise prejudicial to the integrity of the
Company’s assets. For a discussion of the features of the most significant transactions,
please see the Report on Operations accompanying the separate financial statements
of the Company and the consolidated financial statements of the Enel Group for 2022
(in the section “Significant events in 2022”);
• we did not find any atypical or unusual transactions conducted with third parties, Group
companies or other related parties;
• in the section “Related parties” of the notes to the separate financial statements for
2022 of the Company, the directors describe the main transactions with related parties
– the latter being identified on the basis of international accounting standards and the
instructions of CONSOB – carried out by the Company, to which readers may refer for
details on the transactions and their financial impact. They also detail the procedures
adopted to ensure that related-party transactions are carried out in accordance with
the principles of transparency and procedural and substantive fairness. On the basis of
our oversight activities, we found that the transactions were carried out in compliance
with the approval and execution processes set out in the related procedure – adopted
in compliance with the provisions of Article 2391-bis of the Italian Civil Code and the
implementing regulations issued by CONSOB – described in the Report on Corporate
Governance and Ownership Structure for 2022. All transactions with related parties
reported in the notes to the separate financial statements for 2022 of the Company
were executed as part of ordinary operations in the interest of the Company and settled
on market terms and conditions. In view of its importance, please see the section in
the notes to the separate financial statements concerning the “Credit facility
guaranteed by SACE - Disclosure obligations established by art. 13, paragraph 3, letter
c) (ii), of CONSOB Regulation on transactions with related parties”;
• the Company declares that it has prepared its separate financial statements for 2022
on the basis of international accounting standards (IAS/IFRS) – and the interpretations
issued by the IFRIC and the SIC – endorsed by the European Union pursuant to
Regulation (EC) no. 1606/2002 and in force at the close of 2022 (hereinafter also
“IFRS-EU”), as well as the provisions of Legislative Decree 38 of February 28, 2005 and
its related implementing measures, as it did the previous year. The Company’s separate
financial statements for 2022 have been prepared on a going-concern basis using the
cost method, with the exception of items that are measured at fair value under the
IFRS-EU, as indicated in the accounting policies for the individual items of the financial
statements. The notes to the separate financial statements give detailed information
168 Report and financial statements of Enel SpA at December 31, 2022
3
on the accounting standards and measurement criteria adopted, accompanied by an
indication of the standards applied for the first time in 2022, which as indicated in the
notes did not have a significant impact in the year under review;
• the separate financial statements for 2022 of the Company underwent the statutory
audit by the Audit Firm, KPMG SpA, which issued an unqualified opinion, including with
regard to the consistency of the Report on Operations and certain information in the
Report on Corporate Governance and Ownership Structure of the Company with the
financial statements, as well as compliance with the provisions of law, pursuant to
Article 14 of Decree 39/2010 and Article 10 of Regulation (EU) no. 537/2014. The report
of KPMG SpA also includes the declaration provided pursuant to Article 14, paragraph
2(e) of Decree 39/2010 stating that the Audit Firm did not identify any significant errors
in the contents of the report on operations;
• the Company declares that it has also prepared the consolidated financial statements
of the Enel Group for 2022 on the basis of international accounting standards
(IAS/IFRS) – and the interpretations issued by the IFRIC and the SIC – endorsed by
the European Union pursuant to Regulation (EC) no. 1606/2002 and in force at the
close of 2022, as well as the provisions of Legislative Decree 38 of February 28, 2005
and its related implementing measures, as it did the previous year. The 2022
consolidated financial statements of the Enel Group are also prepared on a going-
concern basis using the cost method, with the exception of items that are measured at
fair value under the IFRS-EU (as indicated in the discussion of measurement criteria
for the individual items) and non-current assets (or disposal groups) classified as held
for sale, which are measured at the lower of carrying amount and fair value less costs
to sell. The notes to the consolidated financial statements provide a detailed discussion
of the accounting standards and measurement criteria adopted, accompanied by an
indication of standards applied for the first time in 2022, which did not have a significant
impact in the year under review. Note also that, starting from 2021, in compliance with
the provisions of Delegated Regulation (EU) 2019/815 of December 17, 2018 as
amended (the “ESEF Regulation”), the Company has (i) drawn up its entire Annual
Financial Report (including the separate financial statements and the consolidated
financial statements, the respective reports on operations and the associated
certifications pursuant to Article 154-bis, paragraph 5, of the Consolidated Law on
Financial Intermediation) in the single electronic reporting format XHTML (Extensible
Hypertext Markup Language), and (ii) marked up (with specific tags) the schedules of
the consolidated financial statements and the related explanatory notes using the iXBRL
markup language (Inline eXtensible Business Reporting Language), in accordance with
the ESEF taxonomy issued annually by ESMA, in order to facilitate the accessibility,
analysis and comparability of the annual financial reports;
169
4
• the consolidated financial statements for 2022 of the Enel Group underwent statutory
audit by the Audit Firm KPMG SpA, which issued an unqualified opinion, including with
regard to the consistency of the Report on Operations and certain information in the
Report on Corporate Governance and Ownership Structure with the consolidated
financial statements, as well as compliance with the provisions of law, pursuant to
Article 14 of Decree 39/2010 and Article 10 of Regulation (EU) no. 537/2014. The report
of KPMG SpA also includes:
- a discussion of key aspects of the audit report on the consolidated financial
statements; and
- the declaration provided pursuant to Article 14, paragraph 2(e) of Decree 39/2010
and Article 4 of CONSOB Regulation no. 20267 (implementing Legislative Decree
254 of December 30, 2016) concerning, respectively, a statement that the Audit
Firm did not identify any significant errors in the contents of the Report on
Operations and that it verified that the Board of Directors had approved the
consolidated non-financial statement.
Under the terms of its engagement, KPMG SpA also issued unqualified opinions on the
financial statements for 2022 of the most significant Italian companies of the Enel
Group. Moreover, during periodic meetings with the representatives of the Audit Firm,
KPMG SpA, the latter did not raise any issues concerning the reporting packages of the
main foreign companies of the Enel Group, selected by the auditors on the basis of the
work plan established for the auditing of the consolidated financial statements of the
Enel Group, that would have a sufficiently material impact to be reported in the opinion
on those financial statements;
• taking due account of the recommendations of the European Securities and Markets
Authority issued on January 21, 2013, and most recently confirmed with the Public
Statement of October 28, 2022, to ensure appropriate transparency concerning the
methods used by listed companies in testing goodwill for impairment, in line with the
recommendations contained in the joint Bank of Italy - CONSOB - ISVAP document no.
4 of March 3, 2010, and in the light of indications of CONSOB in its Communication no.
7780 of January 28, 2016, the compliance of the impairment testing procedure with
the provisions of IAS 36 was expressly approved by the Board of Directors of the
Company, having obtained a favorable opinion in this regard from the Control and Risk
Committee in February 2023, i.e., prior to the date of approval of the financial
statements for 2022;
• we examined the Board of Directors’ proposal for the allocation of net profit for 2022
and the distribution of available reserves and have no comments in this regard;
• we note that the Board of Directors of the Company certified, following appropriate
checks by the Control and Risk Committee and the Board of Statutory Auditors in March
2023, that as at the date on which the 2022 financial statements were approved the
170 Report and financial statements of Enel SpA at December 31, 2022
5
Enel Group continued to meet the conditions established by CONSOB (set out in Article
15 of the Markets Regulation, approved with Resolution no. 20249 of December 28,
2017) concerning the accounting transparency and adequacy of the organizational
structures and internal control systems that subsidiaries established and regulated
under the law of non-EU countries must comply with so that Enel shares can continue
to be listed on regulated markets in Italy;
• we monitored, pursuant to the aforementioned Article 15 of the Markets Regulation,
the facts and circumstances concerning the suitability of the administrative-accounting
systems of the subsidiaries referred to in the previous point;
• we monitored, within the scope of our responsibilities, the adequacy of the
organizational structure of the Company (and the Enel Group as a whole), obtaining
information from department heads and in meetings with the boards of auditors or
equivalent bodies of a number of the main Enel Group companies in Italy and abroad,
for the purpose of the reciprocal exchange of material information. As from the second
half of 2014, the organizational structure of the Enel Group is based on a matrix of
global business lines and geographical areas. Taking account of the changes
implemented most recently in 2022 and the early months of 2023, it is organized into:
(i) global business lines, which are responsible for managing and developing assets,
optimizing their performance and the return on capital employed in the various
geographical areas in which the Group operates. The global business lines are: Enel
Green Power and Thermal Generation, Global Energy and Commodity Management,
Enel Grids, Enel X Global Retail and Global E-Mobility; (ii) regions and countries, which
are responsible for managing relationships with local institutional bodies, regulatory
authorities, the media and other local stakeholders, as well as optimizing the customer
portfolio and generation assets, pursuing the best integrated margin, while also
providing staff and other service support to the global business lines and adopting
appropriate security, safety and environmental standards. Regions and countries
comprise: Italy, Iberia, Europe, Latin America, North America, and Africa, Asia and
Oceania; (iii) global service functions, which are responsible for managing information
and communication technology activities (Global Digital Solutions), procurement at the
Group level (Global Procurement) and customer supply activation, invoicing, credit and
customer care processes (Global Customer Operations); and (iv) holding company
functions, which among other things are responsible for managing governance
processes at the Group level. They include: Administration, Finance and Control, People
and Organization, Communications, Legal and Corporate Affairs, Audit, and Innovation
and Sustainability. We found no issues concerning the adequacy of the organizational
system described above in supporting the strategic development of the Company and
the Enel Group or the consistency of that system with control requirements;
171
6
• we met with the boards of auditors or equivalent bodies of a number of the Group’s
main companies in Italy and abroad. These companies, particularly those in Europe,
were affected, as was the Parent Company, by the significant effects of the dynamics
of gas prices and the geopolitical context. While taking account of these phenomena,
no material issues emerged from the exchange of information that would require
mention here beyond the disclosures already provided in the Annual Report;
• we monitored the independence of the Audit Firm, having received today from KPMG
specific written confirmation that they met that requirement (pursuant to the provisions
of Article 6, paragraph 2(a), of Regulation (EU) 537/2014) and paragraph 17 of
international standard on auditing (ISA Italia) 260 and having discussed the substance
of that declaration with the audit partner. In this regard, we also monitored – as
provided for under Article 19, paragraph 1(e), of Decree 39/2010 – the nature and the
scale of non-audit services provided to the Company and other Enel Group companies
by KPMG SpA and the entities belonging to its network. The fees due to KPMG SpA and
the entities belonging to its network are reported in the notes to the separate financial
statements of the Company. Following our examinations, the Board of Statutory
Auditors found no critical issues concerning the independence of KPMG SpA.
We held periodic meetings with the representatives of the Audit Firm, pursuant to
Article 150, paragraph 3, of the Consolidated Law on Financial Intermediation, and no
material issues emerged that would require mention in this report.
With specific regard to the provisions of Article 11 of Regulation (EU) 537/2014, KPMG
SpA today provided the Board of Statutory Auditors with the “additional report” for
2022 on the results of the statutory audit carried out, which indicates no significant
difficulties encountered during the audit or any significant shortcomings in the internal
control system for financial reporting or the Enel accounting system that would raise
issues requiring mention in the opinion on the separate and consolidated financial
statements. The Board of Statutory Auditors will transmit that report to the Board of
Directors promptly, accompanied by any comments it may have, in accordance with
Article 19, paragraph 1(a), of Decree 39/2010.
As at the date of this report, the Audit Firm also reported that it did not prepare any
management letter for 2022;
• we monitored the financial reporting process, the appropriateness of the administrative
and accounting system and its reliability in representing operational events, as well as
compliance with the principles of sound administration in the performance of the
Company’s business and we have no comments in that regard. We conducted our
checks by obtaining information from the head of the Administration, Finance and
Control department (taking due account of the head’s role as the officer responsible for
the preparation of the Company’s financial reports), examining Company
documentation and analyzing the findings of the examinations performed by KPMG SpA.
172 Report and financial statements of Enel SpA at December 31, 2022
7
The Chief Executive Officer and the officer in charge of financial reporting of Enel issued
a statement (regarding the Company’s 2022 separate financial statements) certifying
(i) the appropriateness with respect to the characteristics of the Company and the
effective adoption of the administrative and accounting procedures used in the
preparation of the financial statements; (ii) the compliance of the content of the
financial reports with international accounting standards endorsed by the European
Union pursuant to Regulation (EC) no. 1606/2002; (iii) the correspondence of the
financial statements with the information in the books and other accounting records
and their ability to provide a true and fair representation of the performance and
financial position of the Company; and (iv) that the Report on Operations accompanying
the financial statements contains a reliable analysis of operations and performance, as
well as the situation of the issuer, together with a description of the main risks and
uncertainties to which it is exposed. The statement also affirmed that the
appropriateness of the administrative and accounting procedures used in the
preparation of the separate financial statements of the Company had been verified in
an assessment of the internal control system for financial reporting (supported by the
findings of the independent testing performed by a qualified external advisor) and that
the assessment of the internal control system did not identify any material issues. An
analogous statement was prepared for the consolidated financial statements for 2022
of the Enel Group;
• we monitored the adequacy and effectiveness of the internal control system, primarily
through constant participation of the head of the Audit department of the Company in
the meetings of the Board of Statutory Auditors and holding about half of the meetings
jointly with the Control and Risk Committee, as well as through periodic meetings with
the body charged with overseeing the operation of and compliance with the
organizational and management model adopted by the Company pursuant to
Legislative Decree 231/2001. In the light of our examination and in the absence of
significant issues, there are no reasons to doubt the adequacy and effectiveness of the
internal control and risk management system. In February 2023, the Board of Directors
of the Company expressed an analogous assessment of the situation and also noted,
in November 2022, that the main risks associated with the strategic targets set out in
the 2023-2025 Business Plan were compatible with the management of the Company
in a manner consistent with those targets;
• in 2022 no petitions were received by the Board of Auditors nor did we receive any
complaints concerning circumstances deemed censurable pursuant to Article 2408 of
the Italian Civil Code;
• we monitored the effective implementation of the Corporate Governance Code,
verifying the compliance of Enel’s corporate governance arrangements with the
recommendations of the Code. Detailed information on the Company’s corporate
173
8
governance system can be found in the Report on Corporate Governance and
Ownership Structure for 2022.
In June 2022, the Board of Statutory Auditors verified that the Board of Directors, in
evaluating the independence of non-executive directors, correctly applied the
assessment criteria specified in the Corporate Governance Code and the principle of
the priority of substance over form that must inform the application of the Code’s
recommendations in general, adopting a transparent procedure, the details of which
are discussed in the Report on Corporate Governance and Ownership Structure for
2022.
With regard to the so-called “self-assessment” of the independence of its members,
the Board of Statutory Auditors, in February 2022 (by the previous members of the
Board of Statutory Auditors) and in May 2022 and March 2023 (by the current members
of the Board of Statutory Auditors) ascertained that all standing statutory auditors met
the relevant requirements set out in the Consolidated Law on Financial Intermediation
and in the Corporate Governance Code;
• in the final part of 2022 and during the first two months of 2023, the Board of Statutory
Auditors, with the support of an independent advisory firm, conducted a board review
assessing the size, composition and functioning of the Board of Statutory Auditors, as
has been done since 2018, similar to the review conducted for the Board of Directors
since 2004. This is a best practice that the Board of Statutory Auditors intended to
adopt even in the absence of a specific recommendation of the Corporate Governance
Code, a “peer-to-peer review” approach, i.e., the assessment not only of the
functioning of the body as a whole, but also of the style and content of the contribution
provided by each of the auditors. The approach adopted in performing the board review
for 2022 and the findings of that review are described in detail in the report on
corporate governance and ownership structure for 2022.
During 2022, the Board of Statutory Auditors also participated in an induction program,
characterized by specific studies to update directors and statutory auditors on cyber
security and risk governance issues. The Board of Statutory Auditors suggests that with
each turnover of the corporate bodies, an induction program be conducted in order to
provide an in-depth overview of the structural characteristics and operation of the
Group;
• we monitored the application of the provisions of Legislative Decree 254 of December
30, 2016 (hereinafter “Decree 254”) concerning the disclosure of non-financial and
diversity information by certain large undertakings and groups. In performing that
activity, we monitored the adequacy of the organizational, administrative, reporting
and control system established by the Company in order to enable the accurate
representation in the consolidated non-financial statements for 2022 of the activity of
the Enel Group, its results and its impacts in the non-financial areas referred to in
174 Report and financial statements of Enel SpA at December 31, 2022
9
Article 3, paragraph 1, of Decree 254, and have no comments in this regard. The Audit
Firm, KPMG SpA, has issued, pursuant to Article 3, paragraph 10, of Decree 254 and
Article 5 of CONSOB Regulation no. 20267 of January 18, 2018, its certification of the
conformity of the information provided in the consolidated non-financial statement with
the requirements of applicable law;
• since the listing of its shares, the Company has adopted specific rules (most recently
amended in September 2018) for the internal management and processing of
confidential information, which also set out the procedures for the disclosure of
documentation and information concerning the Company and the Group, with specific
regard to inside information. Those rules (which can be consulted on the corporate
website) contain appropriate provisions directed at subsidiaries to enable Enel to
comply with statutory public disclosure requirements, pursuant to Article 114,
paragraph 2, of the Consolidated Law on Financial Intermediation ;
• in 2002 the Company also adopted (and has subsequently updated, most recently in
February 2021) a Code of Ethics (also available on the corporate website) that
expresses the commitments and ethical responsibilities involved in the conduct of
business, regulating and harmonizing corporate conduct in accordance with standards
of maximum transparency and fairness with respect to all stakeholders;
• with regard to the provisions of Legislative Decree 231 of June 8, 2001 – which
introduced into Italian law a system of administrative (in fact criminal) liability for
companies for certain types of offences committed by its directors, managers or
employees on behalf of or to the benefit of the company – since July 2002 Enel has
adopted a compliance program consisting of a “general part” and various “special parts”
concerning the difference offences specified by Legislative Decree 231/2001 that the
program is intended to prevent. For a description of the manner in which the model
has been adapted to the characteristics of the various Italian companies of the Group,
as well as a description of the purposes of the “Enel Global Compliance Program” for
the Group’s foreign companies, please see the Report on Corporate Governance and
Ownership Structure for 2022. The structure that monitors the operation and
compliance with the program and is responsible for updating it is a collegial body. This
body, appointed in July 2020, is still composed of three external members who jointly
have specific professional expertise on corporate organization matters and corporate
criminal law. The Board of Statutory Auditors received adequate information on the
main activities carried out in 2022 by that body, including in meetings with its
members. Our examination of those activities found no facts or situations that would
require mention in this report;
• in 2022, the Board of Statutory Auditors issued a favorable opinion (at the meeting of
February 2, 2022) on the 2022 Audit Plan, in accordance with the provisions of
Recommendation 33, letter c) of the Corporate Governance Code;
175
10
• a report on the fixed and variable compensation accrued by those who served as
Chairman of the Board of Directors, Chief Executive Officer/General Manager and other
directors in 2022 for their respective positions and any compensation instruments
awarded to them is contained in the second section of the Report on Remuneration
Policy for 2023 and Remuneration Paid in 2022 referred to in Article 123-ter of the
Consolidated Law on Financial Intermediation (for the sake of brevity, “Remuneration
Report” hereinafter), approved by the Board of Directors, acting on a proposal of the
Nomination and Compensation Committee on April 6, 2023, which will be published in
compliance with the time limits established by law. The design of these remuneration
instruments is in line with best practices as it complies with the principle of establishing
a link with appropriate financial and non-financial performance targets and pursuing
the creation of shareholder value over the medium and long term. The proposals to the
Board of Directors concerning such forms of compensation and the determination of
the associated parameters were prepared by the Nomination and Compensation
Committee, which is made up entirely of independent directors, drawing on the findings
of benchmark analyses, including at the international level, conducted by an
independent consulting firm. In addition, the second section of the Remuneration
Report contains, in compliance with the applicable CONSOB regulations, specific
disclosures on the remuneration received in 2022 by the members of the oversight
body and by key management personnel (in aggregate form for the latter).
The Board of Statutory Auditors also supervised the process of preparing the
remuneration policy for 2023, described in full in the first section of the Remuneration
Report, without finding any critical issues. In particular, oversight activity examined
the consistency of the various measures envisaged by that policy with (i) the provisions
of Directive (EU) 2017/828 as transposed into Italian law, (ii) the recommendations of
the Italian Corporate Governance Code, as well as (iii) the results of the benchmark
analysis carried out, including at the international level, by an independent consulting
firm that the Nomination and Compensation Committee elected to engage.
As indicated in the first section of the Remuneration Report, during the preparation of
the remuneration policy for 2023, the Board of Statutory Auditors – taking account of
the recommendations in this regard by the Corporate Governance Code – asked the
independent consulting firm to conduct an additional benchmark analysis to ascertain
the adequacy of the remuneration paid to the members of the oversight body. This
analysis was performed on the basis of the data reported in the documentation
published on the occasion of 2022 shareholders’ meetings by issuers belonging to a
peer group composed – unlike that used for the analogous analysis concerning the
176 Report and financial statements of Enel SpA at December 31, 2022
11
Board of Directors – exclusively of Italian companies belonging the FTSE-MIB index (
1
).
The functions that the Italian legal system assigns to the Board of Statutory Auditors
differentiate the latter from the bodies with oversight functions provided for in the one-
tier and two-tier governance systems commonly adopted in other countries. For the
purpose of identifying the peer group, the consultant, in agreement with the Board of
Statutory Auditors, decided to exclude certain industrial companies belonging to the
FTSE-MIB index that have concentrated ownership structures, while evaluating some
companies in the FTSE-MIB index operating in the financial services industry.
The analysis showed that, on the basis of the data as at December 31, 2021, Enel
exceeds the peer group in terms of capitalization, is above the ninth decile in terms of
revenue and slightly below the ninth decile in terms of number of employees.
The same analysis also found that – against Enel’s very high positioning compared with
the companies included in the panel in terms of capitalization, revenue and number of
employees – the remuneration of the Chairman of the Board of Statutory Auditors and
of the other Statutory Auditors is below the peer group median for the Chairman and
in line with the median for the other standing Statutory Auditors. The analysis also
found that in 2021, on average, the boards of statutory auditors of the companies
belonging to the panel were composed of four standing auditors compared with the
three standing members of Enel’s Board of Statutory Auditors, and held 26 meetings
compared with the 28 meetings held by Enel’s Board of Statutory Auditors.
On the basis of the analysis, it therefore emerged that the competitiveness of the
remuneration envisaged for the Chairman and the other standing members of Enel’s
Board of Statutory Auditors is similar to the positioning of the non-executive directors
of Enel with regard to the remuneration paid to them in their capacity as directors (net
of attendance fees, which at Enel are not envisaged for participation in board meetings
but are paid by some of the peer group companies used for the purpose of preparing
the 2023 policy for directors’ remuneration).
The analysis found that the positioning of the amount of remuneration paid to the
Chairman and the standing members of the Board of Statutory Auditors is substantially
in line with that currently paid by the larger of the peer group companies in which the
Ministry for the Economy and Finance holds a significant direct and/or indirect
investment.
However, the consultant noted that to correctly assess the appropriateness of the
remuneration envisaged for the members of the Board of Statutory Auditors, an overall
assessment of the effort required by the position would be advisable.
(
1
) The peer group consists of the following 18 companies: A2A, Assicurazioni Generali, Banco BPM,
BPER Banca, Eni, Hera, Leonardo, Mediobanca, Nexi, Pirelli, Poste Italiane, Prysmian, Saipem, Snam,
Terna, TIM, UniCredit and Unipol.
177
12
In this regard, a significant element identified by the Board of Statutory Auditors is the
comparison between the average level of remuneration of the members of the Board
of Statutory Auditors and that of the members of the Board of Directors of the Company
(excluding the Chairman and the Chief Executive Officer), taking into account all
meetings (Board of Directors, Committees and Board of Statutory Auditors) in which
they respectively participate. This analysis shows that the average remuneration per
meeting of the directors is more than three times greater than that of the members of
the Board of Statutory Auditors.
The Board of Statutory Auditors’ oversight activity in 2022 was carried out in 24 meetings
and with participation in the 16 meetings of the Board of Directors and participation in the
annual Shareholders’ Meeting, and, through the Chairman or one or more of its members,
in the 14 meetings of the Control and Risk Committee (held jointly with the Board of
Statutory Auditors), in the 11 meetings of the Nomination and Compensation Committee,
in the 1 meeting of the Related Parties Committee and in the 6 meetings of the Corporate
Governance and Sustainability Committee, for a total of 86 meetings. The delegated
magistrate of the State Audit Court participated in the meetings of the Board of Statutory
Auditors and those of the Board of Directors.
During the course of this activity and on the basis of information obtained from KPMG SpA,
no omissions, censurable facts, irregularities or other significant developments were found
that would require reporting to the regulatory authorities or mention in this report.
Finally, the Board of Statutory Auditors notes that:
• in 2021 and until March 31, 2022, the health emergency associated with the COVID-
19 pandemic was still under way in Italy. Through that date, Italian authorities
maintained a number of limitations on freedom of movement within the country to
contain the contagion, among other things imposing bans on gatherings. In this
context, the Board of Statutory Auditors, in the light of the measures to contain the
COVID-19 pandemic, held some of its meetings – as long as the state of emergency
was in place – exclusively with the use of audio/video conference systems by all
participants, which nevertheless ensured their identification and the exchange of
documentation – in accordance with the provisions of Article 25.4 of the bylaws – and,
more generally, the full performance of the oversight body’s functions;
• the ongoing Russia-Ukraine conflict, as well as the instability of commodity prices, in
particular those of gas, strongly influenced operations in 2022. Among other things, we
note the sale of the equity investment in Enel Russia PJSC and the challenges of
managing hedging operations for price fluctuations in the energy markets and the
related cash collateral (margin requirements). In this regard, the SACE-secured credit
facility referred to earlier strengthened the Enel Group liquidity position. For these and
178 Report and financial statements of Enel SpA at December 31, 2022
13
for all other events connected with the aforementioned geopolitical and economic
environment, please see also the discussion in the Company’s Annual Report.
Based on the oversight activity performed and the information exchanged with the
independent Audit Firm KPMG SpA, we recommend that you approve the Company’s
financial statements for the year ended December 31, 2022 in conformity with the
proposals of the Board of Directors.
Rome, April 6, 2023
The Board of Auditors
[signed]
____________________
Barbara Tadolini - Chairman
[signed]
____________________
Luigi Borré - Auditor
[signed]
____________________
Maura Campra - Auditor
179
Report of the Audit Firm
180 Report and financial statements of Enel SpA at December 31, 2022
KPMG S.p.A.
Revisione e organizzazione contabile
Via Curtatone, 3
00185 ROMA RM
Telefono +39 06 80961.1
Email it-fmauditaly@kpmg.it
PEC kpmgspa@pec.kpmg.it
Ancona Bari Bergamo
Bologna Bolzano Brescia
Catania Como Firenze Genova
Lecce Milano Napoli Novara
Padova Palermo Parma Perugia
Pescara Roma Torino Treviso
Trieste Varese Verona
Società per azioni
Capitale sociale
Euro 10.415.500,00 i.v.
Registro Imprese Milano Monza Brianza Lodi
e Codice Fiscal
e N. 00709600159
R.E.A. Milano N. 512867
Partita IVA 00709600159
VAT number IT00709600159
Sede legale: Via Vittor Pisani, 25
20124 Milano MI ITALIA
KPMG S.p.A. è una società per azioni di diritto italiano e fa parte del
network KPMG di entità ind
ipendenti affiliate a KPMG International
Limited, società di diritto inglese.
(This independent auditors’ report has been translated into English solely for the convenience of
international readers. Accordingly, only the original Italian version is authoritative.)
Independent auditors’ report pursuant to article 14 of Legislative
decree no. 39 of 27 January 2010 and article 10 of Regulation (EU)
no. 537 of 16 April 2014
To the shareholders of
Enel S.p.A.
Report on the audit of the separate financial statements
Opinion
We have audited the separate financial statements of Enel S.p.A. (the “company”), which comprise the
statement of financial position as at 31 December 2022, the income statement and the statements of
comprehensive income, changes in equity and cash flows for the year then ended and notes thereto,
which include a summary of the significant accounting policies.
In our opinion, the separate financial statements give a true and fair view of the financial position of Enel
S.p.A. as at 31 December 2022 and of its financial performance and cash flows for the year then ended
in accordance with the International Financial Reporting Standards endorsed by the European Union and
the Italian regulations implementing article 9 of Legislative decree no. 38/05.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (ISA Italia). Our
responsibilities under those standards are further described in the “Auditors’ responsibilities for the audit
of the separate financial statements” section of our report. We are independent of the company in
accordance with the ethics and independence rules and standards applicable in Italy to audits of financial
statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion.
Key audit matters
There are no key audit matters to report.
181
2
Enel S.p.A.
Independent auditors’ report
31 December 2022
Responsibilities of the company’s directors and board of statutory auditors (“Collegio
Sindacale”) for the separate financial statements
The directors are responsible for the preparation of separate financial statements that give a true and fair
view in accordance with the International Financial Reporting Standards endorsed by the European
Union and the Italian regulations implementing article 9 of Legislative decree no. 38/05 and, within the
terms established by the Italian law, for such internal control as they determine is necessary to enable
the preparation of financial statements that are free from material misstatement, whether due to fraud or
error.
The directors are responsible for assessing the company’s ability to continue as a going concern and for
the appropriate use of the going concern basis in the preparation of the separate financial statements
and for the adequacy of the related disclosures. The use of this basis of accounting is appropriate unless
the directors believe that the conditions for liquidating the company or ceasing operations exist, or have
no realistic alternative but to do so.
The Collegio Sindacale is responsible for overseeing, within the terms established by the Italian law, the
company’s financial reporting process.
Auditors’ responsibilities for the audit of the separate financial statements
Our objectives are to obtain reasonable assurance about whether the separate financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report
that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with ISA Italia will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these separate financial statements.
As part of an audit in accordance with ISA Italia, we exercise professional judgement and maintain
professional scepticism throughout the audit. We also:
• identify and assess the risks of material misstatement of the separate financial statements, whether
due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting
a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal
control;
• obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the company’s internal control;
• evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors;
• conclude on the appropriateness of the directors’ use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the company’s ability to continue as a going concern. If
we conclude that a material uncertainty exists, we are required to draw attention in our auditors’
report to the related disclosures in the separate financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditors’ report. However, future events or conditions may cause the company to
cease to continue as a going concern;
182 Report and financial statements of Enel SpA at December 31, 2022
3
Enel S.p.A.
Independent auditors’ report
31 December 2022
• evaluate the overall presentation, structure and content of the separate financial statements,
including the disclosures, and whether the separate financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance, identified at the appropriate level required by ISA
Italia, regarding, among other matters, the planned scope and timing of the audit and significant audit
findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with the ethics
and independence rules and standards applicable in Italy and communicate with them all relationships
and other matters that may reasonably be thought to bear on our independence, and where applicable,
the measures taken to eliminate those threats or the safeguards applied.
Other information required by article 10 of Regulation (EU) no. 537/14
On 16 May 2019, the company’s shareholders appointed us to perform the statutory audit of its separate
and consolidated financial statements as at and for the years ending from 31 December 2020 to 31
December 2028.
We declare that we did not provide the prohibited non-audit services referred to in article 5.1 of
Regulation (EU) no. 537/14 and that we remained independent of the company in conducting the
statutory audit.
We confirm that the opinion on the separate financial statements expressed herein is consistent with the
additional report to the Collegio Sindacale, in its capacity as audit committee, prepared in accordance
with article 11 of the Regulation mentioned above.
Report on other legal and regulatory requirements
Opinion on the compliance with the provisions of Commission Delegated Regulation
(EU) 2019/815
The company’s directors are responsible for the application of the provisions of Commission Delegated
Regulation (EU) 2019/815 with regard to regulatory technical standards on the specification of a single
electronic reporting format (ESEF) to the separate financial statements at 31 December 2022 to be
included in the annual financial report.
We have performed the procedures required by Standard on Auditing (SA Italia) 700B in order to express
an opinion on the compliance of the separate financial statements with Commission Delegated
Regulation (EU) 2019/815.
In our opinion, the separate financial statements at 31 December 2022 have been prepared in XHTML
format in compliance with the provisions of Commission Delegated Regulation (EU) 2019/815.
Opinion pursuant to article 14.2.e) of Legislative decree no. 39/10 and article 123-bis.4 of
Legislative decree no. 58/98
The company’s directors are responsible for the preparation of the reports on operation and on corporate
governance and ownership structure at 31 December 2022 and for the consistency of such reports with
the related separate financial statements and their compliance with the applicable law.
183
4
Enel S.p.A.
Independent auditors’ report
31 December 2022
We have performed the procedures required by Standard on Auditing (SA Italia) 720B in order to express
an opinion on the consistency of the report on operations and the specific information presented in the
report on corporate governance and ownership structure indicated by article 123-bis.4 of Legislative
decree no. 58/98 with the company’s separate financial statements at 31 December 2022 and their
compliance with the applicable law and to state whether we have identified material misstatements.
In our opinion, the report on operations and the specific information presented in the report on corporate
governance and ownership structure referred to above are consistent with the company’s separate
financial statements at 31 December 2022 and have been prepared in compliance with the applicable
law.
With reference to the above statement required by article 14.2.e) of Legislative decree no. 39/10, based
on our knowledge and understanding of the entity and its environment obtained through our audit, we
have nothing to report.
Rome, 6 April 2023
KPMG S.p.A.
(signed on the original)
Renato Naschi
Director
184 Report and financial statements of Enel SpA at December 31, 2022
185
Notice of Ordinary Shareholders’
Meeting
An Ordinary Shareholders’ Meeting is convened, on single call, on May 10, 2023, at 2:00 pm, in Rome, at Auditorium - Parco
della Musica, Via Pietro de Coubertin no. 30, in order to discuss and resolve on the following
AGENDA
1. Financial statements as of December 31, 2022. Reports of the Board of Directors, of the Board of Statutory Auditors and
of the External Auditor. Related resolutions. Presentation of the consolidated financial statements for the year ended on
December 31, 2022, and of the consolidated non-financial statement related to the financial year 2022.
2. Allocation of the annual net income.
3. Authorization for the acquisition and the disposal of treasury shares, subject to the revocation of the authorization gran-
ted by the Ordinary Shareholders’ Meeting held on May 19, 2022. Related resolutions.
4. Determination of the number of the members of the Board of Directors.
5. Determination of the term of the Board of Directors.
6. Election of the members of the Board of Directors.
7. Election of the Chair of the Board of Directors.
8. Determination of the remuneration of the members of the Board of Directors.
9. Long-Term Incentive Plan 2023 reserved to the management of Enel SpA and/or of its subsidiaries pursuant to Article
2359 of the Italian Civil Code.
10. Report on the remuneration policy and compensations paid:
10.1 First section: report on the remuneration policy for 2023 (binding resolution);
10.2 Second section: report on the compensations paid in 2022 (non-binding resolution).
The Chair of the Board of Directors
Michele Crisostomo
186 Report and financial statements of Enel SpA at December 31, 2022
Proposed allocation of the annual net
income
Dear Shareholders,
the dividend policy contained in the 2022-2024 Strategic Plan (presented to the financial community in November 2021) pro-
vides, with specific regard to the 2022 results, for the payment to Shareholders of a fixed dividend – equal to overall €0.40 per
share – to be paid in two instalments, through the payment of an interim dividend scheduled for January and the payment of the
balance of the dividend scheduled for July.
In light of the above, on November 3, 2022 the Board of Directors has approved, pursuant to Article 2433-bis of the Italian Civil
Code and Article 26.3 of the Corporate Bylaws, the distribution of an interim dividend for the financial year 2022 amounting to
€0.20 per share, that has been paid, gross of any withholding tax, from January 25, 2023. The no. 7,153,795 treasury shares held
by the Company as of January 24, 2023 (i.e. at the record date) did not participate in the distribution of such interim dividend.
Therefore, the interim dividend for the financial year 2022 actually paid to Shareholders amounted to €2,031,905,230.20, while
an amount of €1,430,759.00 was earmarked for the reserve named “retained earnings” in consideration of the number of trea-
sury shares held by Enel SpA at the record date indicated above.
Taking into consideration that the Enel SpA net income for the year 2022 amounts approximately to €7,157 million and conside-
ring the interim dividend already paid, the Board of Directors proposes the distribution of a balance of the dividend amounting
to €0.20 per share (for an overall maximum amount approximately equal to €2,033 million, as specified below), to be paid in July
2023.
It should also be noted that, starting from 2020 financial year, the Board of Directors authorized the issue of non-convertible su-
bordinated hybrid bonds with a so-called “perpetual” duration. Under IAS/IFRS international accounting standards, such bonds
are accounted for as equity instruments and the related interests shall be accounted for as an adjustment to shareholders’
equity at the same time the payment obligation arises. In this respect, in 2022 financial year Enel SpA has paid to the holders of
these bonds an overall amount of approximately €123.4million.
In light of the above, and considering that the legal reserve is already equal to the maximum amount of one-fifth of the share
capital (as provided for by Article 2430, paragraph 1, of the Italian Civil Code), we therefore submit for your approval the following
Agenda
The Shareholders’ Meeting of Enel SpA, having examined the explanatory report of the Board of Directors,
resolves
1. to earmark the net income of Enel SpA for the year 2022, amounting to €7,157,365,948.95, as follows:
– for distribution to Shareholders:
• €0.20 for each of the 10,159,526,151 ordinary shares in circulation on the ex-dividend date (considering the 7,153,795
treasury shares held by the Company at the “record date” indicated under this specific bullet point), to cover the interim
dividend payable from January 25, 2023, with the ex-dividend date of coupon no. 37 having fallen on January 23, 2023
and the “record date” (i.e. the date of the title to the payment of the dividend, pursuant to Article 83-terdecies of Le-
gislative Decree 58 of February 24, 1998 and to Article 2.6.6, paragraph 2, of the Rules of the Markets Regulation and
managed by Borsa Italiana SpA) falling on January 24, 2023, for an overall amount of €2,031,905,230.20;
• €0.20 for each of the 10,166,679,946 ordinary shares in circulation on July 24, 2023 (i.e. on the ex-dividend date), net of
the treasury shares that will be held by Enel SpA at the “record date” indicated under point 2 of this resolution, as the
balance of the dividend, for an overall maximum amount of €2,033,335,989.20;
– for the reserve named “retained earnings”, an overall amount of €123,434,990.29, to cover the amounts paid in 2022, at
the maturity of the respective coupons, to the holders of the non-convertible subordinated hybrid bonds with a so-called
“perpetual” duration issued by Enel SpA;
– for the same reserve named “retained earnings” the remaining part of the net income, for an overall minimum amount
of €2,968,689,739.26, which might increase consistently with the balance of the dividend not paid due to the number of
treasury shares that will be held by Enel SpA at the “record date” indicated under point 2 of this resolution;
2. to pay, before withholding tax, if any, the balance of the dividend of €0.20 per ordinary share – net of the treasury shares that
will be held by Enel SpA at the “record date” indicated here below – as from July 26, 2023, with the ex-dividend date of cou-
pon no. 38 falling on July 24, 2023 and the “record date” (i.e. the date of the title to the payment of the dividend, pursuant to
Article 83-terdecies of Legislative Decree 58 of February 24, 1998 and to Article 2.6.6, paragraph 2, of the Markets Regulation
organized and managed by Borsa Italiana SpA) falling on July 25, 2023.
Concept design and realization
Gpt Group
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