REPORT AND FINANCIAL STATEMENTS

OF ENEL SPA AT DECEMBER 31, 2023

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.

REPORT AND FINANCIAL STATEMENTS

OF ENEL SPA AT DECEMBER 31, 2023

Dear shareholders and stakeholders,

Last year was marked by an important change in the

management of the Enel Group, with the election of the

entire Board of Directors and the appointment of the new

Chairman in the person of Paolo Scaroni. The Board of

Directors in turn entrusted the position of Chief Executive

Officer to Flavio Cattaneo.

The extraordinary events that have impacted the global

geopolitical and macroeconomic environment have

generated unprecedented volatility in the energy system

and wrought structural changes in the energy market.

In this context, our new management has delineated

the new strategy underpinning the Group’s 2024-2026

Business Plan, which envisages: (i) the rigorous allocation

of resources to boost the return on capital employed,

together with the balancing of risk and return in

investment decisions and models; (ii) greater efficiency and

effectiveness in processes and organizational structure,

seeking to increase accountability and free up financial

resources to drive the industrial development of the

Group; and (iii) financial and environmental sustainability,

confirming our commitments to the energy transition and

the electrification of energy consumption, while ensuring a

more balanced and sustainable financial structure.

In 2023, Enel confirmed its position as the largest private

renewable power generator in the world, with 63 GW of

managed capacity (including our growing and necessary

battery energy storage capacity) and the largest private

electricity distribution company at the global level, with

over 70 million end users served by grids that will have

to deliver increasing levels of resilience and digitalization

to support the electrification of energy consumption.

Furthermore, we have the largest customer base among

private companies, with some 61 million electricity and gas

customers.

The Group’s leadership in sustainability has once again

been recognized worldwide, underscored by its constant

presence in various major sustainability rankings and

indices.

LETTER TO

SHAREHOLDERS

AND OTHER

STAKEHOLDERS

Paolo Scaroni

Chairman

Flavio Cattaneo

Chief Executive Officer

and General Manager

4 Report and financial statements of Enel SpA at December 31, 2023

End users

70.3

million

Renewables capacity

managed

The macroeconomic environment

In 2023, global growth proved more resilient than expect-

ed at the beginning of the year, thanks to a faster-than-ex-

pected reduction in inflation in many economies, support-

ed by the gradual normalization of energy commodity

prices and the gradual easing of supply chain bottlenecks.

Many governments’ energy support programs also helped

mitigate the impacts of the turbulence on household in-

comes and support productive activity in many econo-

mies.

However, the results differed among countries: growth

was solid in the United States, sustained by the recovery in

public and private spending, and in Latin America, where

inflation slowed and political and labor market conditions

improved. Conversely, much of the euro area experienced

an abrupt economic slowdown, reflecting both the re-

strictive monetary policy stance adopted by the European

Central Bank in order to counter inflationary pressures and

weak foreign demand, also accompanied by challenging

geopolitical developments in the Middle East.

With regard to the energy industry, in 2023, the Europe-

an gas market displayed a significant downward trend in

prices, thanks to high levels of storage and declining de-

mand, with the average reduction in TTF (Title Transfer Fa-

cility) prices exceeding 65% compared with 2022, reach-

ing about €35/MWh in the last quarter of 2023. Coal-fired

generation also declined, primarily discouraged by the rise

in CO2 prices within the ETS (Emissions Trading System),

despite coal prices plunging by 55.5% to an average of

$129/ton.

Compared with 2022, electricity prices in Italy and Spain

fell sharply, reflecting the decline in energy commodi-

ty prices and, in part, growing renewables generation.

More specifically, electricity prices in Italy decreased by

58% compared with the previous year, while in Spain they

dropped by 48%.

In the metals sector, economic weakness adversely im-

pacted the prices of aluminum and copper, with declines

of 16.6% and 3.8% respectively compared with 2022. Met-

als associated with renewable energy technologies, such

as lithium and polysilicon, experienced an even steeper

slide in prices as demand contracted.

Performance

Thanks to management actions and our focus on the core

business, the Group closed the 2023 financial year having

achieved our full-year targets as revised upwards in the

3rd Quarter and announced to the market, with ordinary

EBITDA of €22.0 billion and an ordinary net profit of €6.5

billion, up 12% and about 21%, respectively, compared with

the previous year. The dividend that will be proposed to

shareholders for 2023 amounts to €0.43 per share, 7.5%

higher than that for 2022. In terms of cash generation,

FFO in 2023 amounted to about €14.8 billion, up more

than 60% compared with 2022. Net debt is equal to €60.2

billion, with the net debt to ordinary EBITDA ratio improv-

ing from 3.1x to 2.7x. This last indicator does not yet reflect

the effects of the proceeds generated by divestments,

already announced to investors and subject to binding

agreements between the parties, carried out in 2023 as

part of the extraordinary plan to reduce the Group’s finan-

cial debt. Recall that the Plan approved in 2022 to restore

a sustainable and balanced Group financial structure pro-

vided for the sale of Group investments and other assets

of over €12 billion in 2023 alone.

Main events

In 2023, the Group confirmed its hard-won technologi-

cal leadership in renewables generation and distribution

grids.

On the power generation front, in 2023 Enel built out

about 5.3 GW of new renewables capacity (including 934

MW of battery storage), reaching a total of approximately

63 GW of installed capacity and a volume of renewables

generation of 140 TWh/year. The capacity we operate is

also supported by a pipeline of projects in the advanced

development phase of up to 160 GW.

In the power distribution segment, our strong commit-

ment to modernizing and digitalizing electricity grids

continues, both to increase their resilience to increasingly

extreme and frequent climate events and to make them

ready to play the role of enablers of the energy transition:

during the year, Enel Grids activated almost 540,000 new

5Letter to shareholders and other stakeholders

producer and prosumer

(1)

connections globally, adding

about 8 GW of distributed renewables capacity connect-

ed to our grids, reaching a total of some 68 GW of capac-

ity from approximately 2 million producer and prosumer

connections.

The development of a portfolio of products dedicated to

residential consumers, businesses and municipalities also

confirmed the Group’s leading role in fostering the energy

transition and the electrification of consumption.

In 2023, Enel X Global Retail operated at full capacity with a

new, more tightly integrated structure to reap the benefits

of bundled packages of electricity, gas, electric mobility,

energy efficiency and ultra-fast connectivity services. An

example of this is the “Formidabile” offer, launched in Italy

at the end of October 2023 and in Spain at the beginning

of 2024. Our commitment to improving the customer ex-

perience also continues: in 2023 commercial complaints

decreased by 12%

(2)

compared with the previous year, and

in February the German Institute for Quality and Finance

awarded Enel Energia its “Nr. 1 in Service” quality seal

based on customer satisfaction in the electricity and gas

sector, with a score of 74.2%, well above the category av-

erage of 55.9%.

The new Enel Global Service Function, which groups to-

gether Global Information & Communication Technolo-

gies, Global Procurement, Global Customer Operations

and the newly established Workforce Evolution, contin-

ued the Group’s digital transformation path, focusing on

solutions and advanced technologies, such as artificial

intelligence and quantum computing solutions. Thanks in

part to the key skills we have developed internally, to date

we have over 500 traditional and generative artificial in-

telligence applications in operation or in the development

phase, mainly to support the Generation, Distribution and

Retail businesses. Furthermore, the Workforce Evolution

unit will promote the evolution of employee skills consis-

tent with these new technological tools and with the stra-

tegic repositioning of the Group, in order to foster greater

internal control over higher value activities and guarantee

our distinctive positioning in the markets and sectors in

which the Group is present.

The Group continues to follow the decarbonization road-

map in line with limiting global warming to below 1.5 ºC. In

2023, absolute direct and indirect greenhouse gas emis-

sions along the Group’s entire value chain, equal to 94.3

(1) “Prosumer”, a contraction of “producer” and “consumer”, is an individual or firm that not only consumes goods and services but also produces them, such

as, for example, by installing photovoltaic panels to generate electricity.

(2) Reduction in new complaints for each 10,000 customers.

MtCO

2eq

, declined by 26.3% compared with 2022, and re-

main in line with the targets for 2030 and 2040 certified by

the Science Based Targets initiative (SBTi).

The financial instruments employed by the Group are also

closely linked to sustainability objectives. In 2023, Enel

Finance International NV issued euro-denominated sus-

tainability-linked bonds in the amount of €1.5 billion, us-

ing multiple key performance indicators (KPIs) to further

strengthen Enel’s commitment in accelerating the energy

transition. For the first time, in fact, a tranche of a publicly

placed bond involved the combination of a KPI linked to

the EU taxonomy with a KPI linked to the United Nations

Sustainable Development Goals (SDGs), while the other

tranche of the bond was linked to two KPIs associated with

the Group’s full decarbonization trajectory through the re-

duction of direct and indirect greenhouse gas emissions.

These bond issues have enabled us to achieve a ratio

between the sources of sustainable financing and the

Group’s total gross debt of approximately 64%, a level that

will rise further over the period of the Plan.

In parallel, in order to reduce debt and strengthen the

Group’s financial structure, our new management team

has revised the divestment plan referred to earlier with a

view to portfolio rotation focused on maximizing the value

of assets. In this context, the Argentine thermal genera-

tion companies Enel Generación Costanera SA and Inver-

sora Dock Sud SA were sold during the year, and agree-

ments were signed for the disposal of the Peruvian elec-

tricity distribution and supply company Enel Distribución

Perú SAA, the advanced energy services company Enel X

Perú SAC and the electricity generator Enel Generación

Perú SAA. The divestment of all the investments held by

the Group in Romania was also completed. Asset rotation

transactions were also completed, including the sale of a

portfolio of photovoltaic plants in Chile (416 MW) and the

entire geothermal portfolio in the United States, as well

as several small solar plants in that country. Finally, in line

with the strategy presented to investors on our steward-

ship approach in non-core countries, acting through the

subsidiary Enel Green Power SpA we completed the sale

of 50% of the two companies that own all of the Group’s

renewables operations in Australia to INPEX Corporation,

while the sale of 50% of Enel Green Power Hellas to Mac-

quarie Asset Management was finalized.

6 Report and financial statements of Enel SpA at December 31, 2023

Strategy and forecasts

for 2024-2026

Short-term global uncertainties have forced electricity

companies to increase their flexibility and improve the vis-

ibility and predictability of prospective returns.

In this context, over the 2024-2026 Plan period the Enel

Group plans to focus on:

•

profitability, flexibility and resilience through selective

capital allocation aimed at optimizing the Group’s risk/

return profile;

•

efficiency and effectiveness as drivers of the Group’s

operations, based on process simplification, a leaner

organization with defined responsibilities and a focus

on core geographies in which the Group has an inte-

grated position (Italy, Spain, Brazil, Chile, Colombia and

the United States), as well as boosting operational effi-

ciency in order to maximize cash generation and offset

inflationary pressures and the higher cost of capital;

•

financial and environmental sustainability to pursue val-

ue creation with a balance and solid financial structure,

addressing the challenges of climate change.

In this scenario, regulated businesses will be at the center

of the Group’s strategy, with a concentration of invest-

ment in geographical areas with a clear and predictable

regulatory framework as well as stable macroeconomic

environments. Investment decisions on renewables will

be more selective, seeking to achieve a positioning that

maximizes returns and mitigates risks at the same time.

Finally, the Group plans to optimize its customer portfolio

and end-to-end processes, enhancing efficiency in cus-

tomer acquisition and management, improving customer

loyalty through bundled offers and promoting the electri-

fication of energy consumption. The generation and retail

businesses will be managed in a more integrated manner,

with a flexible approach to sourcing strategies in order to

maximize profitability along the entire value chain.

In the 2024-2026 period, the Group’s gross investments

will amount to €35.8 billion, of which €18.6 billion will be

allocated to Grids, €12.1 billion to Renewables and €3 bil-

lion to Customers.

Thanks to the implementation of a less capital- and

risk-intensive business model, investments will have a

smaller cash requirement, with expected net investments

of about €26.2 billion thanks to access to European grants

and financing (up to €3.5 billion) and the use of a diversi-

fied co-investment model for renewables projects (a total

of about €6.1 billion).

Investments in distribution grids will increase their ef-

(3) Capacity of the system to carry additional power.

(4) Upgrading a plant in order to increase efficiency, capacity and output.

ficiency, flexibility and resilience: more than half will be

allocated to grid strengthening, remote operation, auto-

mation and digitalization projects in order to deliver high

standards of service quality and reduce power losses. In

addition to managing assets, the remainder will be allo-

cated to expanding hosting capacity

(3)

to meet customer

demand for new connections and encourage the integra-

tion of distributed generation from renewable resources,

all to support the energy transition and the electrification

of final energy consumption.

Investments in renewables will add 13.4 GW of new capac-

ity, bringing the Group’s total to 73 GW (including energy

storage systems) by 2026, with the share of zero-emis-

sions generation growing from 75% to about 86%.

The push for innovation will continue to be a strategic

driver: in generation, it will improve plant performance

through the introduction of new technologies along the

entire value chain. The use of repowering

(4)

and automa-

tion is also expected to increase the efficiency of plants

and processes, as will testing of new battery technologies

and energy storage systems, whose role will be increas-

ingly important in ensuring the flexibility of electrical sys-

tems. In grids, digitalization, new automation models and

the introduction of new technologies will enable new ap-

proaches to remuneration.

Finally, the Group will continue to pursue the evolution of

new technologies that will mature over the medium and

long term, such as hydrogen and new small and modular

nuclear fission reactors or fusion power.

On the environmental sustainability front, the Group in-

tends to continue reducing its direct and indirect green-

house gas emissions by achieving the zero-emissions tar-

get for all Scopes by 2040, in line with the Paris Agreement

and with the 1.5 ºC scenario, as certified by the SBTi.

Group ordinary EBITDA is expected to increase to between

€23.6 and 24.3 billion in 2026, with a CAGR (Compound

Average Growth Rate) of approximately 5%, while our am-

bition for Group ordinary profit is a rise to between €7.1

and 7.3 billion in 2026, with a CAGR of about 6% compared

with 2023, net of differences in scope.

The organic and structural path of reducing the Group’s

net debt will enable us to achieve a ratio of net debt to

EBITDA of about 2.3 by 2026, down from over 3 at the end

of 2022.

Finally, as regards shareholder remuneration, the Group

has decided to adopt a simple and attractive dividend

policy with a minimum fixed DPS (dividend per share) of

€0.43 for the 2024-2026 period, with a potential increase

up to a payout of 70% of ordinary profit if cash neutrality

is achieved.

7Letter to shareholders and other stakeholders

CONTENTS

Letter to shareholders and other stakeholders 4

Enel organizational model 12

Enel shareholders 15

Corporate boards 16

Enel shares 19

Activities of Enel SpA 21

Significant events in 2023 22

Definition of performance measures 24

Performance and financial position

of Enel SpA 25

Performance of the main subsidiaries 30

People centricity 34

Research and development 43

Main risks and opportunities 45

Outlook 52

Other information 53

Incentive system 56

REPORT ON

OPERATIONS 11

Guide to navigating

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Statement of Comprehensive Income

Statement of Financial Position

Statement of Cash Flows

Statement of Changes in Equity

Income Statement

Separate financial statements 64

Notes to the separate financial

statements 71

Declaration of the Chief Executive

Officer and the officer in charge

of financial reporting 153

SEPARATE

FINANCIAL

STATEMENTS 63

Report of the Board of Statutory

Auditors to the Shareholders’

Meeting of Enel SpA 156

Report of the Audit Firm 172

Notice of Ordinary Shareholders’

Meeting 177

Allocation of the annual net income

and distribution of available reserves 178

REPORTS 155

Report on corporate governance

and ownership structure 60

CORPORATE

GOVERNANCE 59

10 Report and financial statements of Enel SpA at December 31, 2023

REPORT ON

OPERATIONS

Separate financial statements

Corporate governance

Reports

Report on Operations

ENEL ORGANIZATIONAL

MODEL

(5) The Head of the Audit Function acts under the supervision of the Chairman of the Board of Directors and officially reports to the Board of Directors of Enel

SpA while continuing to functionally report to the CEO as director in charge of the Internal Control and Risk Management System.

The Enel Group structure is organized into a matrix that

comprises:

•

four 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);

•

two Countries and one Region, which are responsible for

driving financial performance, managing relations with

customers, institutions and regulatory authorities, sales

of electricity, gas and new products and services at the

country level; providing staff services and activities to the

global business lines present in the country;

•

one Global Service Function, which is responsible for the

integrated management of all Group activities relating

to the development and governance of digital solutions,

procurement processes and strategy, customer man-

agement processes and approaches, insourcing pro-

cesses in collaboration with the People and Organization

Function and for maximizing and managing the value

real estate portfolio and the related general services;

•

six Holding Company Staff Functions, which are focused

on policy-making, coordination and strategic control of

the entire Group;

•

one CEO Office and Strategy, which is responsible for

providing support to the CEO in developing and directing

the Group’s strategic decisions and defining the Group’s

medium/long-term strategic positioning by developing

strategic scenarios that also consider the effects of cli-

mate change.

The Holding Company is focused on activities involving a

significant degree of policy-making, coordination and con-

trol for the Group as a whole. Operating through the Ad-

ministration, Finance and Control, People and Organization,

External Relations, Legal, Corporate, Regulatory and Anti-

trust Affairs, Security, Audit

(5)

and CEO Office and Strategy

Functions, the Holding Company seeks to:

•

manage activities with significant value creation poten-

tial 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/Region/Countries in key strategic decisions con-

cerning those activities and related strategic control

issues.

The Holding Company exercises its policy-making, coordi-

nation and control role in essentially two ways:

•

direct management: in which, in addition to performing

the policy-making, coordination and control role, it also

has total or prevalent responsibility for performing the

associated activities (e.g., finance, M&A, etc.);

•

indirect management: in which it plays a policy-making

and supervisory role, while execution of operations is es-

sentially delegated to the Business Lines/Functions/Re-

gion/Countries on the basis of policies, processes and

guidelines. 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/Region/Country level. This re-

porting connection envisages that the Head of the Hold-

ing Company function and the Head of the Business Line/

Function/Region/Country jointly manage the appointment,

evaluation and development of the head of the corre-

sponding Holding Company function at the Business Line/

Function/Region/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/Region/

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.

12 Report and financial statements of Enel SpA at December 31, 2023

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 evalu-

ating investment proposals;

•

conducting M&A operations;

•

defining the optimal structure of Group capital and the

composition of debt, managing loans, liquidity and re-

lations with the international banking system, financial

institutions, investors and analysts and managing finan-

cial risk and insurance coverage for the entire Group;

•

preparing the financial statements of Enel SpA and set-

ting the guidelines and policies for preparing the finan-

cial statements of the Group companies;

•

preparing an adequate and effective internal control

platform for financial and tax information for corporate

reporting;

•

ensuring tax compliance for Enel SpA and tax planning,

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 optimiz-

ing or minimizing their impact.

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 budget and the long-term plan

at the Group level, defining guidelines and objectives;

defining the Group’s guidelines for the compensation

and benefit process; managing industrial relations;

•

developing the Group’s technical, professional and

managerial 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 secu-

rity, ensuring their implementation at the Group level.

External Relations

The External Relations Function has the mission of:

•

developing and managing the global Enel brand iden-

tity, leveraging the Group’s resources, skills and opera-

tional excellence;

•

managing relations with global media;

•

developing and managing internal communication of

local and global content and defining the guidelines to

be applied at the country level;

•

managing and optimizing the Group’s online commu-

nication channels, including the Group’s websites and

social network presence;

•

characterizing, representing and promoting the Enel

Group’s position with institutions, both at an interna-

tional and national level; monitoring legislative develop-

ments and identifying and suggesting regulatory pro-

posals that favor the interests of the Group.

Separate financial statements

Corporate governance

Reports

Report on Operations

13Enel organizational model

Legal, Corporate, Regulatory and Antitrust Affairs

The Legal, Corporate, Regulatory and Antitrust Affairs

Function has the mission of:

•

providing legal assistance and support to the entire

Group, identifying and managing legal issues and liti-

gation and ensuring the compliance of activities car-

ried out by Group companies with applicable laws and

regulations;

•

managing the corporate governance system and advis-

ing on the related issues (including relations with the fi-

nancial market regulatory authorities and managing the

corporate bodies and the system of delegated powers);

•

characterizing, representing and promoting the Enel

Group’s position on regulatory and antitrust issues,

representing the Group with European organizations

and institutional bodies.

Audit

The Audit Function has the mission of:

•

systematically and independently assessing the effec-

tiveness and adequacy of the Enel Group’s internal con-

trol system;

•

supporting each part of the Group in monitoring risks

and identifying mitigation actions.

Security

The Security Function has the mission of:

•

developing security strategy and guidelines consistent

with risk forecasts, regulations and international stan-

dards, as well as establishing implementation priorities

and objectives at the country level;

•

monitoring security risks and threats, including IT risks,

at the Group level and implementing effective mea-

sures to prevent, counter and mitigate any possible risk

or threat to the safety of people, physical and intangible

assets and the continuity of business operations.

CEO Office and Strategy

The CEO Office and Strategy Function has the mission of:

•

supporting the CEO in defining and coordinating stra-

tegic decisions and monitoring the Group’s internal ac-

tivities in relations with key internal and external stake-

holders in accordance with the CEO’s guidelines and

Group positioning;

•

defining the Group’s strategy, long-term planning and

strategic objectives, and guiding the related deci-

sion-making processes;

•

ensuring the alignment of internal stakeholders with

the Group’s strategic positioning, the positioning on

ESG (Environmental, Social and Governance) issues and

the strategy to be implemented in response to climate

change, as well as the related external disclosure.

14 Report and financial statements of Enel SpA at December 31, 2023

ENEL SHAREHOLDERS

At December 31, 2023, 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, 2022.

In implementation of the authorization of the Sharehold-

ers’ Meeting of May 10, 2023 and the subsequent reso-

lution of the Board of Directors adopted on October 5,

2023, Enel has completed a program for the purchase of

treasury shares to serve the 2023 LTI Plan for the man-

agement of Enel and/or its subsidiaries pursuant to Article

2359 of the Italian Civil Code. More specifically, as a re-

sult of transactions carried out between October 16, 2023

and January 18, 2024 in execution of the aforementioned

program, the Company has acquired a total of 4,200,000

treasury shares. Accordingly, considering the 7,153,795

treasury shares already held at December 31, 2022 and

taking account of the disbursement on September 5,

2023 of 1,268,689 Enel shares to the beneficiaries of the

2019 LTI Plan and the 2020 LTI Plan, at the date of publica-

tion of this report the Company holds a total of 10,085,106

treasury shares; at December 31, 2023, during the imple-

mentation of the aforementioned program, Enel held a to-

tal of 9,262,330 treasury shares.

Significant shareholders

At December 31, 2023, based on the shareholders regis-

ter 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 informa-

tion, shareholders with an interest of greater than 3% in the

Company’s share capital included the Ministry for the Econ-

omy and Finance (with a 23.585% stake) and BlackRock Inc.

(with a 5.023% stake held for asset management purposes).

Composition of shareholder base

Since 1999, Enel has been listed on the Euronext Milan

market organized and operated by Borsa Italiana SpA.

Enel’s shareholders include leading international invest-

ment funds, insurance companies, pension funds and

ethical funds.

With regard to Environmental, Social and Governance

(ESG) investors in Enel, at December 31, 2023, socially re-

sponsible investors (SRIs) held around 17.5% of the share

capital (from 14.9% at December 31, 2022). Investors who

have signed the Principles for Responsible Investment rep-

resent 42.8% of the share capital (compared with 42.1% at

December 31, 2022).

23.6%

Ministry for the Economy

and Finance

17.8%

Retail

investors

58.6%

Institutional

investors

Separate financial statements

Corporate governance

Reports

Report on Operations

15Enel shareholders

CORPORATE BOARDS

CHAIRMAN

Paolo Scaroni

CHIEF EXECUTIVE OFFICER

AND GENERAL MANAGER

Flavio Cattaneo

SECRETARY

Leonardo Bellodi

DIRECTORS

Johanna Arbib

Mario Corsi

Olga Cuccurullo

Dario Frigerio

Fiammetta Salmoni

Alessandra Stabilini

Alessandro Zehentner

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

16 Report and financial statements of Enel SpA at December 31, 2023

2023

(1) The figures for 2023 and 2022 refer to directors qualifying as independent pursuant to the Consolidated Law on Financial Intermediation and the Italian

Corporate Governance Code (2020 edition).

(2) In accordance with the Diversity Policy adopted by the Enel Board of Directors, “international experience” is assessed on the basis of the managerial, pro-

fessional, academic or institutional activities performed by each director in international environments.

COMPOSITION OF

THE BOARD OF DIRECTORS

of which 7 independent

(1)

8 in 2022

8 non-executive directors

8 in 2022

1 executive director

1 in 2022

EXPERTISE

GENDER

44.4%

women

44.4%

in 2022

55.6%

men

55.6%

in 2022

AGE

0% 30-50

0% <30

100%

> 50

Energy industry

1 2 30 4 5

6 7 8

International experience

(2)

1 2 30 4 5

6 7 8

Strategic vision

1 2 30 4 5

6 7 8

Accounting, finance and risk management

1 2 30 4 5

6 7 8

Business judgement

1 2 30 4 5

6 7 8

Environmental, social and corporate governance

1 2 30 4 5

6 7 8

Legal and compliance

1 2 30 4 5

6 7 8

Communication and marketing

1 2 30 4 5

6 7 8

5 men

5 in 2022

4 women

4 in 2022

Separate financial statements

Corporate governance

Reports

Report on Operations

17Corporate boards

$Graphics$

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 12, 2023, 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 12, 2023 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.

18 Report and financial statements of Enel SpA at December 31, 2023

ENEL SHARES

Enel and the financial markets

2023 2022

Consolidated gross operating profit per share (euro)

(1)

1.99 1.96

Consolidated operating profit per share (euro)

(1)

1.07 1.10

Group profit per share (euro)

(1)

0.34 0.17

Group ordinary profit per share (euro)

(1)

0.64 0.53

Dividend per share (euro) 0.43 0.40

Group equity per share (euro)

(1)

3.12 2.82

Share price – 12-month high (euro) 6.73 7. 20

Share price – 12-month low (euro) 5.17 4.00

Average share price in December (euro) 6.63 5.15

Market capitalization (millions of euro)

(2)

67, 36 9 52,325

(1) The number of shares considered to calculate the index is 10,166,679,946 and includes 9,262,330 treasury shares in 2023 and 7,153,795 treasury shares in 2022.

(2) Calculated on average share price in December.

at Dec. 31, 2023 at Dec. 31, 2022

Rating

Standard & Poor’s Outlook STABLE NEGATIVE

Medium/long-term BBB BBB+

Short-term A-2 A-2

Moody’s Outlook NEGATIVE NEGATIVE

Medium/long-term Baa1 Baa1

Short-term - -

Fitch Outlook STABLE STABLE

Medium/long-term BBB+ BBB+

Short-term F2 F2

The global macroeconomic environment in 2023 was char-

acterized by a broad decline in the real economy. The re-

strictive monetary policy stances adopted by central banks

to counter inflationary pressures, the deterioration in finan-

cial and credit conditions, and the decline in trade and in-

vestment at the global level caused a slowdown in global

growth, with GDP estimated to have grown by around 3% on

an annual basis (slightly down compared with 2022).

In this context, the main European stock indices – after a

2022 characterized by a general decline – closed 2023 on

the rise: FTSE-MIB +28%, Ibex35 +22.8%, DAX +20.3% and

CAC40 +16.5%.

The euro area utilities index (EURO STOXX Utilities) closed

the year with a gain of +11.9%.

Finally, as regards the Enel stock, 2023 ended with a price

of €6.73 per share, a sharp rise (+33.8%) on the previous

year, outperforming both the Italian index and the European

sectoral index.

On January 25, 2023 Enel paid an interim dividend of €0.20

per share from 2022 profits and on July 26, 2023 it paid the

balance of the dividend for that year in the amount of €0.20.

Total dividends distributed in 2023 amounted to €0.40 per

share, more than 5% higher than the €0.38 per share dis-

tributed in 2022.

On January 24, 2024 an interim dividend of €0.215 per share

was paid in respect of ordinary profit for 2023, while the bal-

ance of the dividend is scheduled for payment on July 24,

2024.

Separate financial statements

Corporate governance

Reports

Report on Operations

19Enel shares

At December 31, 2023, institutional investors represent-

ed 58.6% of share capital (up from 56.7% at December 31,

2022), while the share of individual investors came to 17.8%

(as against 19.7% at December 31, 2022). The interest of

the Ministry for the Economy and Finance was unchanged

at 23.6%.

Socially responsible investors (SRIs) expanded their in-

terest to about 17.5% of share capital at December 31,

2023 (up from 14.9% at December 31, 2022) and repre-

sent 29.8% of institutional investors (26.2% at December

31, 2022). Investors who have signed the Principles for

Responsible Investment represent 42.8% of share capital

(42.1% at December 31, 2022).

For further information we invite you to visit the Investor

Relations section of our corporate website (https://www.

enel.com/investors/overview), 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 institutional

investors (phone: +39-0683057975; e-mail: investor.rela-

tions@enel.com).

PERFORMANCE OF ENEL SHARE PRICE AND THE EURO STOXX UTILITIES

AND FTSE-MIB INDICES FROM JANUARY 1, 2023 TO DECEMBER 31, 2023

Source: Bloomberg.

1 - Jan- 23

1 - Feb - 23

1 - Mar - 23

1 - Apr - 23

1 - May - 23

1 - Jun - 23

1 - Jul - 23

1 - Aug - 23

1 - Sep - 23

1 - Oct - 23

1 - Nov - 23

1 - Dec - 23

70.0

80.0

90.0

100.0

110.0

120.0

130.0

140.0

Enel FTSE-MIB EURO STOXX Utilities

20 Report and financial statements of Enel SpA at December 31, 2023

ACTIVITIES

OF ENEL SPA

Enel SpA, in its capacity as an industrial holding company,

determines strategic objectives for the Group and the sub-

sidiaries, coordinating their activity. The activities that Enel

SpA performs as part of its policy-making and coordination

function in respect of the other Group companies, as reflect-

ed in the organizational structure adopted by the Compa-

ny, are attributable to the Holding Company Staff Functions,

connected with the coordination of governance processes

at the Group level, and can be summarized as follows:

•

Administration, Finance and Control;

•

People and Organization;

•

External Relations;

•

Legal, Corporate, Regulatory and Antitrust Affairs;

•

Audit;

•

Security;

•

CEO Office and Strategy.

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 ex-

cess liquidity.

Separate financial statements

Corporate governance

Reports

Report on Operations

21Activities of Enel SpA

SIGNIFICANT

EVENTS IN 2023

The most significant events in 2023 involving the Compa-

ny and the direct subsidiaries are summarized below.

Enel places new perpetual hybrid bonds for €1.75 billion to

refinance some of its outstanding hybrid bonds

On January 9, 2023 Enel SpA successfully launched the is-

suance of non-convertible, subordinated, perpetual hybrid

bonds for institutional investors on the European market,

denominated in euros with an aggregate principal amount

of €1.75 billion (the “New Securities”).

The new issue was structured in two series of bonds

(€1,000 and €750 million, respectively) non-convertible,

subordinated, perpetual hybrid bond, with no fixed matu-

rity, due and payable only in the event of the winding up

or liquidation of the Company, as specified in the related

terms and conditions.

At the same time, Enel launched voluntary tender offers to

repurchase for cash and subsequently cancel, in the total

aggregate principal amount equal to the principal amount

raised from the New Securities, all or part of the €750-mil-

lion equity-accounted perpetual hybrid bond with first call

date in August 2023, and the repurchase of part of the

outstanding $1,250-million hybrid bond maturing Sep-

tember 2073 with call date in September 2023, subject to

satisfaction of a number of conditions.

With the conclusion of the voluntary tender offer, Enel:

•

repurchased in cash its outstanding perpetual hybrid

bond denominated in euros in the total nominal amount

of €699,970,000. Subsequently, having satisfied the

conditions envisaged in the clean-up call clause, which

provided for the option of repurchasing the remaining

part of the bond upon exceeding 80% participation in

the tender offer, on February 27, 2023 the transaction

was settled in the amount of €50,049,000.00, fully re-

deeming the perpetual hybrid bond;

•

repurchased all valid offers received in connection with

the US dollar bond in the aggregate principal amount

of $411,060,000. In September the bond was fully re-

deemed with the exercise of the first call date option.

Enel launches a €1.5 billion sustainability-linked bond

On February 14, 2023, Enel Finance International NV

launched a dual-tranche sustainability-linked bond for in-

stitutional investors for a total of €1.5 billion. The new issue

envisages for the first time the use by Enel of multiple Key

Performance Indicators (KPIs) per tranche. One tranche of

the bond combines a KPI linked to the EU taxonomy with a

KPI linked to the United Nations Sustainable Development

Goals (SDGs). The other tranche of the bond is linked to

two KPIs related to the Group’s full decarbonization path

through direct and indirect reductions of greenhouse gas

emissions.

22 Report and financial statements of Enel SpA at December 31, 2023

Enel launches a sustainability-linked share buyback program

serving its 2023 Long-Term Incentive Plan

On October 5, 2023, the Board of Directors of Enel SpA,

implementing the authorization granted by the Share-

holders’ Meeting of May 10, 2023 and in compliance with

the relevant terms previously disclosed to the market, ap-

proved the launch of a share buyback program for a to-

tal of 4.2 million shares, equal to approximately 0.041% of

Enel’s share capital.

The program, which ran from October 16, 2023 until

January 18, 2024, was designed to serve the 2023 Long-

Term Incentive Plan for the management of Enel and/or

of its subsidiaries pursuant to Article 2359 of the Italian

Civil Code, which was also approved by the Shareholders’

Meeting on May 10, 2023.

As part of the program, Enel purchased a total of 4,200,000

treasury shares at the weighted average price of €6.3145

per share, for a total of about €26 million.

Enel closes the sale of a photovoltaic generation portfolio in

Chile to Sonnedix

On October 25, 2023, Enel SpA and its listed subsidiary

Enel Chile SA closed the sale of the entire equity inter-

ests held by Enel (about 0.009%) and Enel Chile (about

99.991%) in the share capital of Arcadia Generación Solar

SA, a Chilean company which owns a portfolio of four op-

erating PV plants, to Sonnedix, an international renewable

energy producer. The transaction was closed following the

fulfillment of all conditions set forth in the stock purchase

agreement signed on July 12, 2023, including receipt of

clearance from the Chilean antitrust authority Fiscalía Na-

cional Económica (FNE).

Pursuant to the above agreement, the purchaser paid a

total of €535 million, corresponding to the 100% enter-

prise value agreed by the parties.

In line with the strategic priorities of the Enel Group, the

transaction contributes to the objective of constantly im-

proving our return on capital employed to support future

development plans.

Enel finalized the sale of its Romanian operations to PPC

On October 25, 2023, Enel finalized the sale to the Greek

company Public Power Corporation SA (PPC) of all the in-

terests held by the Enel Group in Romania, following the

fulfillment of all the conditions set forth in the related sale

agreement, signed on March 9, 2023.

In line with the agreement, PPC paid a total of about

€1,241 million, corresponding to about €1,900 million in

terms of enterprise value (on a 100% basis). An earn-out

mechanism is also envisaged, involving a potential further

post-closing payment based on the future value of the re-

tail business.

Separate financial statements

Corporate governance

Reports

Report on Operations

23Significant events in 2023

DEFINITION OF

PERFORMANCE

MEASURES

In order to present the results of the Company and analyze

its financial structure, Enel has prepared separate reclassi-

fied schedules that differ from those envisaged under the

IFRS-EU adopted by Enel SpA and presented in the sepa-

rate financial statements. These reclassified schedules con-

tain different performance measures from those obtained

directly from the separate financial statements, in line with

the ESMA Guidelines on Alternative Performance Measures

(ESMA/2015/1415) published on October 5, 2015. Manage-

ment believes that these measures are useful in monitoring

the performance of the Parent and representative of the fi-

nancial performance of the business.

As regards those measures, on April 29, 2021 CONSOB is-

sued warning notice no. 5/2021 which gives force to the

Guidelines issued on March 4, 2021 by the European Securi-

ties and Markets Authority (ESMA) concerning disclosure re-

quirements under Regulation (EU) 2017/1129 (the Prospectus

Regulation), which took effect on May 5, 2021 and replace the

references to the CESR Recommendations and those con-

tained in Communication no. DEM/6064293 of July 28, 2006

regarding the net financial position.

These Guidelines update the previous CESR Recommen-

dation (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. They are intended to promote the useful-

ness and transparency of alternative performance measures

included in regulated information or prospectuses within the

scope of application of Directive 2003/71/EC in order to im-

prove their comparability, reliability and comprehensibility.

Accordingly, in line with the regulations cited above, the crite-

ria used to construct these measures are as follows.

Gross operating profit: an operating performance indicator,

calculated as the sum of “Operating profit”, “Depreciation,

amortization and impairment” and “Net impairment/(reversals

of impairment) on trade receivables and other receivables”.

Net non-current assets: calculated as the difference between

“Non-current assets” and “Non-current liabilities” with the ex-

ception of:

•

“Deferred tax assets”;

•

“Other financial assets” included in “Other non-current fi-

nancial 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 collateral”

and “Other financial assets” included in “Other current fi-

nancial 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”, “Deferred

tax liabilities” and “Deferred tax assets”.

Net capital employed: calculated as the algebraic sum of

“Gross capital employed”, “Provisions for risks and charges”

and “Employee benefits”.

Net financial debt: a financial structure indicator, calculated

as:

•

“Long-term borrowings” and “Short-term borrowings and

the current portion of long-term borrowings”, taking ac-

count of “Short-term borrowings” included in “Other cur-

rent 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-cur-

rent financial assets”.

24 Report and financial statements of Enel SpA at December 31, 2023

PERFORMANCE AND

FINANCIAL POSITION

OF ENEL SPA

Performance

The financial performance of Enel SpA for the years 2023

and 2022 is summarized in the table below:

Millions of euro

2023 2022 Change

Revenue

Revenue from sales and services 107 116 (9)

Other income 56 17 39

Total 163 133 30

Costs

Purchase of consumables - - -

Services, leases and rentals 202 206 (4)

Personnel expenses 135 105 30

Other operating costs 47 27 20

Total 384 338 46

Gross operating profit/(loss) (221) (205) (16)

Depreciation, amortization and impairment losses 719 1,330 (611)

Operating profit/(loss) (940) (1,535) 595

Net financial income/(expense) and profit/(expense) from equity

investments

Income from equity investments 4,269 8,770 (4,501)

Financial income 1,388 2,563 (1,175)

Financial expense 1,821 2,747 (926)

Total 3,836 8,586 (4,750)

Pre-tax profit/(loss) 2,896 7, 0 51 (4,155)

Income taxes (136) (106) (30)

PROFIT FOR THE YEAR 3,032 7, 157 (4,125)

Revenue from sales and services regards revenue for

management services, IT assistance and other services

provided to subsidiaries. The decrease of €9 million is at-

tributable to reductions in revenue from management ser-

vices (€5 million) and from IT services and other services

(€4 million).

Other income essentially includes the €43 million capital

gain from the sale of the 49.5% investment held in the joint

venture Rusenergosbyt LLC and the chargeback of costs

for Enel SpA personnel seconded to other Group compa-

nies (€12 million).

Costs for purchase 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 €76 million and by

Group companies in the amount of €126 million.

Third-party services mainly include system and application

Separate financial statements

Corporate governance

Reports

Report on Operations

25Performance and financial position of Enel SpA

assistance services, communication services, profession-

al and technical services, strategic consulting, business

management and organization.

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 ser-

vices and administrative services.

Personnel expenses totaled €135 million, an increase of

€30 million on 2022, mainly attributable to the change in

costs for early-retirement incentive plans implemented by

the Company.

Other operating costs amounted to €47 million, an in-

crease of €20 million that mainly reflected the waiver of

receivables of the Company and other Group companies

in respect of Enel Generación Costanera SA under the

Termination Intercompany Agreement signed as part of

the agreements for the sale of our assets in Argentina and

uncollected receivables due from Rusenergosbyt LLC.

The gross operating loss of €221 million reflects a de-

crease of €16 million from the previous year, attributable

to an increase in personnel expenses and other operating

expenses, partially offset by an increase in revenue.

Depreciation, amortization and impairment losses

amounted to €719 million, a decrease of €611 million on

the previous year.

Depreciation and amortization amounted to €51 million, of

which €4 million in depreciation and €47 million in amor-

tization.

Impairment losses include the adjustment in the value of

the investments in the subsidiary Enel Green Power SpA in

the amount of €605 million and the further €46 million ad-

justment in the value of the investments in subsidiaries in

Romania, recognized as non-current assets held for sale,

which were sold in October 2023.

The item also includes impairment losses and reversals

of impairment on trade receivables and other receivables

totaling €16 million, mainly reflecting an increase in provi-

sions for impaired receivables.

In 2022, the item included the adjustment in the value of

the investments in subsidiaries in Romania (€995 million),

the adjustment of €195 million to the investment in Enel

Russia PJSC, which was sold in October 2022, and the ad-

justment in the value of equity investments in Enel Green

Power SpA (in the amount of €228 million), Enel Innova-

tion Hubs Srl (€16 million), and Enel Investment Holding BV

(€1 million). It also included reversals of impairment losses

on the investments in the subsidiaries Enel Global Trading

SpA (€162 million) and Enel Global Services Srl (€1 million).

The operating loss came to €940 million, an improvement

of €595 million due to lower impairment losses on equity

investments.

Income from equity investments amounted to €4,269

million and included dividends approved by subsidiaries

which, compared with 2022, show a decrease of €4,501

million, reflecting a decrease in earnings distributed by

Enel Italia SpA, which in 2022 had distributed available re-

serves in the amount of €6,000 million, partly offset by an

increase in dividends from Enel Iberia SRLU, Enel Grids Srl

and Enel Chile SA.

Net financial expense came to €433 million and essentially

reflects interest expense on debt (€853 million), partially

offset by commission income on guarantees issued for

other companies of the Group (€214 million), interest in-

come on financial assets (€183 million) and net financial

income on derivative contracts (€38 million).

Compared with the previous year, net financial expense

increased by €249 million, mainly as the result of the de-

crease in net financial income on derivative instruments

(€133 million) and the increase in interest expense on bank

borrowings and a number of intercompany loans (€215

million), partially offset by lower interest expense on bonds

(€57 million) and the increase in interest income on short-

term financial assets (€52 million).

Income taxes for the year showed a creditor position of

€136 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 consoli-

dated 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 €30 mil-

lion is mainly due to the decline in estimated taxable in-

come for IRES.

Profit for the year totaled €3,032 million, compared with

€7,157 million in 2022. The decrease of €4,125 million

mainly reflects the decrease in income from equity invest-

ments, partially offset by the decrease in impairment ad-

justments on equity investments as described above.

26 Report and financial statements of Enel SpA at December 31, 2023

Analysis of financial position

Millions of euro

at Dec. 31, 2023 at Dec. 31, 2022 Change

Net non-current assets:

- property, plant and equipment and intangible assets 140 144 (4)

- equity investments 60,917 59,952 965

- net other non-current assets/(liabilities) (300) (246) (54)

Total 60,757 59,850 907

Net working capital:

- trade receivables 167 294 (127)

- net other current assets/(liabilities) (2,705) (2,065) (640)

- trade payables (135) (155) 20

Total (2,673) (1,926) (747)

Gross capital employed 58,084 57, 92 4 160

Provisions:

- employee benefits (121) (131) 10

- provisions for risks and charges and net deferred taxes 33 6 27

Total (88) (125) 37

Non-current assets classified as held for sale - 654 (654)

Net capital employed 57,996 58,453 (457)

Total equity 37, 8 83 38,342 (459)

NET FINANCIAL DEBT 20,113 20,111 2

The increase in net non-current assets essentially reflected:

•

€965 million from an increase in the value of the invest-

ments in subsidiaries, which was basically attributable to

the following transactions:

–

the establishment on March 23, 2023 of Enel Reinsur-

ance - Compagnia di riassicurazione SpA, 100% owned

by Enel SpA with a share capital of €3 million. The es-

tablishment of the company is part of the project to

re-domicile in Italy the Dutch reinsurance company

Enel Insurance NV, the Group’s captive insurance com-

pany;

–

a capital contribution of €1,502 million to the subsid-

iary Enel North America Inc. to support the business

requirements of its companies and ensure the com-

pletion of projects under construction;

–

a capital contribution of €100 million to Enel Insurance

NV in order to support its reinsurance business during

the transfer of reinsurance operations from the Neth-

erlands to Italy, IVASS having issued the necessary au-

thorizations for the merger of Enel Insurance NV into

Enel Reinsurance - Compagnia di riassicurazione SpA

and for the company resulting from the merger to en-

gage in reinsurance activities;

–

the sale in December 2023 of the equity investment

in the joint venture Rusenergosbyt LLC, carried at €41

million;

–

impairment losses on the investment in Enel Green

Power SpA (€605 million), mainly reflecting changes

in macroeconomic conditions and the consequent in-

crease in discount rates;

•

€54 million from an increase in net other non-current

assets/(liabilities), which essentially reflected:

–

a decrease in non-current derivative assets (€88 mil-

lion) and in non-current derivative liabilities (€43 mil-

lion);

–

a decrease in other non-current assets (€8 million);

•

€4 million from changes in property, plant and equipment

and intangible assets, reflecting the net negative balance

between depreciation/amortization and capital expendi-

ture during the year.

Net working capital, a negative €2,673 million, went even

further negative, by €747 million compared to December

31, 2022, due to the following:

•

€640 million for the negative balance of net other cur-

rent assets/(liabilities) as a result of:

–

an increase in other current liabilities (€1,522 million),

mainly due to an increase in tax liabilities for IRES

(corporate income tax) and higher payables to Group

companies deriving from the VAT Group;

–

an increase in other current assets (€997 million),

due to an increase in receivables from Group com-

panies in respect of the Italian IRES tax consolida-

tion mechanism and from Group companies for

dividends to be received, offset by a decline in VAT

receivables from tax authorities;

Separate financial statements

Corporate governance

Reports

Report on Operations

27Performance and financial position of Enel SpA

–

a decrease in current derivative assets (€314 million)

and current derivative liabilities (€72 million);

•

€127 million for the decrease in trade receivables, of

which €115 million due from Group companies;

•

€20 million for the decrease in trade payables, of which

€10 million due to Group companies.

Net capital employed at December 31, 2023 amounted to

€57,996 million and was funded by equity of €37,883 mil-

lion and net financial debt of €20,113 million.

Equity amounted to €37,883 million, a decrease of €459

million on 2022. The change is mainly attributable to net

profit for 2023 in the amount of €2,972 million; the dis-

tribution of the dividend for 2022 in the amount of €0.20

per share (for a total of €2,033 million), as approved by the

shareholders on May 10, 2023 and the interim dividend for

2023 approved by the Board of Directors on November 7,

2023 and paid as from January 24, 2024 (€0.215 per share

for a total of €2,186 million); the issue of perpetual hybrid

bonds in the amount of €1,738 million and the repurchase

and subsequent cancellation of perpetual hybrid bonds for

a total of €752 million; the payment of coupons to holders

of perpetual hybrid bonds for a total of €182 million.

Net financial debt amounted to €20,113 million at the end

of the year, with a debt-to-equity ratio of 53.09% (52.45%

at the end of 2022).

Analysis of the financial structure

Millions of euro

at Dec. 31, 2023 at Dec. 31, 2022 Change

Long-term debt:

- bank borrowings 1,316 1,527 (211)

- bonds 2,265 4,262 (1,997)

- other lease financing - - -

- loans from subsidiaries 14, 274 12,407 1,867

Long-term debt 17,855 18,196 (341)

Long-term loan assets from third parties (3) (4) 1

Net long-term debt 17,8 5 2 18,192 (340)

Short-term debt/(liquidity):

- current portion of long-term loans 1,179 1,430 (251)

- short-term bank borrowings 1 25 (24)

- short-term debt payable to Group companies 4,500 3,000 1,500

- cash collateral received 169 365 (196)

Short-term debt 5,849 4,820 1,029

- short-term loans granted to Group companies (6) (512) 506

- other short-term financial receivables (5) (5) -

- cash collateral paid (482) (389) (93)

- net short-term financial position with Group companies (1,973) 2,873 (4,846)

- cash and cash equivalents with banks and short-term securities (1,122) (4,868) 3,746

Net short-term debt/(liquidity) 2,261 1,919 342

NET FINANCIAL DEBT 20,113 20,111 2

Net financial debt amounted to €20,113 million and is in

line with 2022.

The main financial transactions in 2023 were:

•

the early repayment of a $1,250 million hybrid bond

maturing in 2073, involved in a voluntary tender offer

launched on January 9, 2023 and completed on Feb-

ruary 7, with the purpose of repurchasing and subse-

quently cancelling part of the bond (tender offer), for an

amount of $416 million (equivalent to €392 million), and

in September with the exercise of the first call date op-

tion for the remaining $834 million, equivalent to €781

million;

•

the repayment to the subsidiary Enel Finance Interna-

tional NV of a maturing fixed-rate loan of €1,200 million,

a short-term revolving credit line of €3,000 million and

28 Report and financial statements of Enel SpA at December 31, 2023

partial repayments of other loans totaling €132 million;

•

the receipt of a new short-term revolving credit line

from Enel Finance International NV in the amount of

€4,500 million and a new floating-rate loan of €2,000

million;

•

the repayment of the maturing portion of an INA Assita-

lia bond in the total amount of €97 million;

•

the repayment by Enel Global Trading SpA of €506 mil-

lion on a credit line granted in 2022;

•

the combined effect of an increase of €93 million in

cash collateral paid and a decrease of €196 million in

cash collateral received from counterparties;

•

a decrease in the net financial exposure on accounts

held with Group companies, reflecting transactions to-

taling €4,846 million.

Cash and cash equivalents amounted to €1,122 million,

a decrease of €3,746 million compared to December 31,

2022, mainly attributable to a decrease in dividends re-

ceived from Group companies during the year.

Please see the section “Cash flows” for more details.

Cash flows

Millions of euro

2023 2022 Change

Cash and cash equivalents at the beginning of the year 4,868 952 3,916

Cash flows from operating activities 4,277 8,689 (4,412)

Cash flows from investing activities (1,007) (1,647) 640

Cash flows from financing activities (7,016) (3,126) (3,890)

Cash and cash equivalents at the end of the year 1,122 4,868 (3,746)

Cash flows from operating activities in 2023 were a posi-

tive €4,277 million (€8,689 million at December 31, 2022),

down €4,412 million on 2022, mainly reflecting a decrease in

dividends received, partly offset by a decrease in IRES pay-

ments on account for Group companies participating in the

consolidated taxation mechanism and a decrease in cash

requirements connected with the change in net working

capital.

During the year, financing activities absorbed cash flows of

€7,016 million, essentially reflecting repayments in the pe-

riod of long-term borrowings (€2,803 million) and perpet-

ual hybrid bonds (€752 million), the payment of dividends

(€4,091 million), the net decrease in financial debt (€3,107

million) and the payment of coupons to holders of perpetual

hybrid bonds (€182 million), partly offset by the issue of new

long-term financing (€2,201 million) and perpetual hybrid

bonds (€1,738 million).

Investing activities absorbed cash flows of €1,007 million,

essentially reflecting capital contributions to Enel North

America Inc. (€1,502 million) and Enel Insurance NV (€100

million), as well as capital contributions to the newly formed

Enel Reinsurance - Compagnia di riassicurazione SpA (€3

million), partly offset by the liquidity generated by the sale of

companies in Romania and Rusenergosbyt LLC.

The cash requirements of financing and investing activities

were funded by the cash flows generated by operating ac-

tivities in the amount of €4,277 million and the use of cash

and cash equivalents, which at December 31, 2023 amount-

ed to €1,122 million (€4,868 million at January 1, 2023).

Separate financial statements

Corporate governance

Reports

Report on Operations

29Performance 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,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

Endesa SA

(1)

Consolidated 28,825 30,142 12,458 19,925 41,283 50,067 19,504 23,627 14,575 20,682 7,204 5,758 41,283 50,067

Enel Américas SA Consolidated 24,021 25,307 9,342 7,275 33,363 32,582 9,149 10,681 8,806 7,4 27 15,408 14,474 33,363 32,582

Enel Chile SA Consolidated 9,507 9,680 2,760 3,370 12,267 13,050 4,133 4,738 3,199 3,485 4,935 4,827 12,267 13,050

Enel Italia SpA Consolidated 41,345 38,877 15,739 16,524 57,084 55,401 27, 23 9 27,7 14 25,391 23,942 4,454 3,745 57,084 55,401

Enel North America Inc. Consolidated 13,118 14,226 1,441 2,113 14,559 16,339 6,422 6,971 1,986 3,607 6,151 5,761 14,559 16,339

Enel Finance International NV Separate 42,663 43,871 13,648 17,7 38 56,311 61,609 37,823 41,379 8,275 9,944 10,213 10,286 56,311 61,609

Enel Grids Srl Separate 98 75 297 511 395 586 24 26 326 241 45 319 395 586

Enel Global Services Srl Separate 123 144 459 545 582 689 28 33 503 605 51 51 582 689

Enel Global Trading SpA Separate 341 830 14,024 28,008 14,365 28,838 625 953 11,602 27,505 2,138 380 14,365 28,838

Enel Green Power SpA Separate 1,855 1,092 873 2,072 2,728 3,164 1,647 1,819 414 863 667 482 2,728 3,164

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 26,287 26,298 1,121 799 27,408 27, 097 2,706 3,046 1,041 616 23,661 23,435 27,408 27, 097

Enel Innovation Hubs Srl Separate - - 11 9 11 9 - - 3 2 8 7 11 9

Enel Insurance NV

(2)

Separate 554 511 545 423 1,099 934 376 288 156 114 567 532 1,099 934

Enel Investment Holding BV Separate 1 1 5 5 6 6 - - 1 1 5 5 6 6

Enel X Srl Separate 994 993 172 183 1,166 1,176 112 115 948 868 106 193 1,166 1,176

Enel X Way Srl Separate 570 936 74 46 644 982 81 4 256 160 307 818 644 982

Enelpower Srl Separate 1 2 37 38 38 40 1 6 8 8 29 26 38 40

Enel Reinsurance - Compagnia

di riassicurazione SpA

Separate - - 3 - 3 - - - - - 3 - 3 -

(1) For comparative purposes, the figure at December 31, 2022 reflects the restatement effected as a result of the amendment of IAS 12.

(2) For comparative purposes, the figure at December 31, 2022 reflects the restatement effected as a result of the application of IFRS 17.

30 Report and financial statements of Enel SpA at December 31, 2023

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,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

Endesa SA

(1)

Consolidated 28,825 30,142 12,458 19,925 41,283 50,067 19,504 23,627 14,575 20,682 7,204 5,758 41,283 50,067

Enel Américas SA Consolidated 24,021 25,307 9,342 7,275 33,363 32,582 9,149 10,681 8,806 7,427 15,408 14,474 33,363 32,582

Enel Chile SA Consolidated 9,507 9,680 2,760 3,370 12,267 13,050 4,133 4,738 3,199 3,485 4,935 4,827 12,267 13,050

Enel Italia SpA Consolidated 41,345 38,877 15,739 16,524 57,084 55,401 27, 23 9 27,7 14 25,391 23,942 4,454 3,745 57,084 55,401

Enel North America Inc. Consolidated 13,118 14,226 1,441 2,113 14,559 16,339 6,422 6,971 1,986 3,607 6,151 5,761 14,559 16,339

Enel Finance International NV Separate 42,663 43,871 13,648 17,73 8 56,311 61,609 37,823 41,379 8,275 9,944 10,213 10,286 56,311 61,609

Enel Grids Srl Separate 98 75 297 511 395 586 24 26 326 241 45 319 395 586

Enel Global Services Srl Separate 123 144 459 545 582 689 28 33 503 605 51 51 582 689

Enel Global Trading SpA Separate 341 830 14,024 28,008 14,365 28,838 625 953 11,602 27,505 2,138 380 14,365 28,838

Enel Green Power SpA Separate 1,855 1,092 873 2,072 2,728 3,164 1,647 1,819 414 863 667 482 2,728 3,164

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 26,287 26,298 1,121 799 27,408 27, 097 2,706 3,046 1,041 616 23,661 23,435 27,408 27, 097

Enel Innovation Hubs Srl Separate - - 11 9 11 9 - - 3 2 8 7 11 9

Enel Insurance NV

(2)

Separate 554 511 545 423 1,099 934 376 288 156 114 567 532 1,099 934

Enel Investment Holding BV Separate 1 1 5 5 6 6 - - 1 1 5 5 6 6

Enel X Srl Separate 994 993 172 183 1,166 1,176 112 115 948 868 106 193 1,166 1,176

Enel X Way Srl Separate 570 936 74 46 644 982 81 4 256 160 307 818 644 982

Enelpower Srl Separate 1 2 37 38 38 40 1 6 8 8 29 26 38 40

Enel Reinsurance - Compagnia

di riassicurazione SpA

Separate - - 3 - 3 - - - - - 3 - 3 -

Separate financial statements

Corporate governance

Reports

Report on Operations

31Performance 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 profit/

(expense) from equity

investments Pre-tax profit/(loss) Income taxes

Profit/(Loss)

for the year

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

at Dec. 31,

2023

at Dec. 31,

2022

Endesa SA Consolidated 25,459 32,896 21,682 27,331 3,777 5,565 2,132 1,878 1,645 3,687 (580) (200) 1,065 3,487 303 891 762 2,596

Enel Américas SA

(1)

Consolidated 11,919 13,469 8,452 9,511 3,467 3,958 1,259 2,402 2,208 1,556 (867) (934) 1,341 622 622 657 1,084 288

Enel Chile SA Consolidated 4,823 5,402 3,679 4,122 1,144 1,280 299 286 845 994 154 944 999 1,938 250 512 749 1,426

Enel Italia SpA Consolidated 46,259 58,033 37,063 51,849 9,196 6,184 3,094 3,039 6,102 3,145 (1,355) (649) 4,747 2,496 1,581 1,586 3,166 910

Enel North America Inc. Consolidated 1,887 2,103 1,241 1,211 646 892 1,810 418 (1,164) 474 (327) (186) (1,491) 288 (360) 97 (1,131) 191

Enel Finance International NV Separate 2,284 1,667 1,778 1,561 506 106 - - 506 106 (16) (42) 490 64 140 20 350 44

Enel Grids Srl Separate 397 690 404 422 (7) 268 1 2 (8) 266 (8) (5) (16) 261 (8) (31) (8) 292

Enel Global Services Srl Separate 898 908 834 819 64 89 59 68 5 21 (6) 1 (1) 22 (2) 8 1 14

Enel Global Trading SpA Separate 33,683 82,598 32,119 82,464 1,564 134 33 32 1,531 102 (43) (52) 1,488 50 385 62 1,103 (12)

Enel Green Power SpA Separate 485 449 408 309 77 140 13 596 64 (456) 108 378 172 (78) (26) 36 198 (114)

Enel Holding Finance Srl Separate - - - - - - - - - - - - - - - - - -

Enel Iberia SRLU Separate 53 40 65 39 (12) 1 - (1) (12) 2 1,499 672 1,487 674 (155) (51) 1,642 725

Enel Innovation Hubs Srl Separate 6 6 6 6 - - - - - - - - - - - - - -

Enel Insurance NV

(2)

Separate 159 154 265 140 (106) 14 - - (106) 14 - 21 (106) 35 (30) 9 (76) 26

Enel Investment Holding BV Separate 2 1 3 2 (1) (1) - - (1) (1) - - (1) (1) - - (1) (1)

Enel X Srl Separate 117 203 108 126 9 77 71 43 (62) 34 (24) (3) (86) 31 7 (23) (93) 54

Enel X Way Srl Separate 72 47 98 53 (26) (6) 488 17 (514) (23) (8) 4 (522) (19) (13) (4) (509) (15)

Enelpower Srl Separate - - (4) - 4 - 1 - 3 - 1 - 4 - 1 (1) 3 1

Enel Reinsurance - Compagnia di

riassicurazione SpA

Separate - - - - - - - - - - - - - - - - - -

(1) Profit/(Loss) for the year includes discontinued operations.

(2) For comparative purposes, the figure at December 31, 2022 reflects the restatement effected as a result of the application of IFRS 17.

32 Report and financial statements of Enel SpA at December 31, 2023