Italy's Enel ups minimum dividend, to invest over $45 bln by 2027
Enel ups investor rewards in updated business plan
Grids will be main engine of growth
Enel to create new company for connection assets
Adds details from paragraph 8
By Francesca Landini
MILAN, Nov 18 (Reuters) -Italy's biggest utility Enel ENEI.MI said on Monday it would lift its minimum dividend for the 2025-2027 period to 0.46 euros per share from 0.43 euros previously and simplify its investor reward policy.
In its updated three-year plan, the state-controlled group said it would invest around 43 billion euros ($45 billion), 7 billion euros more than envisaged in the 2024-2026 strategy.
Capital expenditure on power grids will increase around 40% from the previous plan to 26 billion euros, investments in renewable projects will remain almost unchanged at 12 billion euros, while 2.7 billion euros will be devoted to customers.
This year, the group expects to complete a wide-ranging asset disposal plan started in late 2022 that will cut its debt to around 2.4 times core earnings, below a sector average of 3.1, the company said.
All its targets for 2024 will be met on the back of strong results at its renewable division.
With its debt in check and a cost cutting programme still running, the management team headed by Chief Executive Flavio Cattaneo will now boost capital expenditure in regulated assets and seek opportunities in offering services to data centres.
"Between 2025 and 2027, we will focus on core activities and a flexible capital allocation, increasing investments mainly on regulated assets with predictable returns that will also support the acceleration of the energy transition," Cattaneo said in a statement.
The CEO, appointed in May last year with the support of Italy's right-wing government, steered the company towards a more selective approach for renewable energy projects and focused spending on Europe.
Enel said it would devote 75% of investments to Europe, with the rest going to Latin America and North America.
The group now expects ordinary earnings before interest, taxes, depreciation and amortisation (EBITDA) to increase to 22.9-23.1 billion euros in 2025, and potentially reach up to 24.5 billion in 2027.
Net ordinary income is seen rising to 6.7-6.9 billion euros next year and surpassing 7 billion at the end of the plan.
The new dividend policy foresees a higher dividend floor and an upside potential of up to 70% of net ordinary income.
($1 = 0.9486 euros)
Additional reporting by Nilutpal Timsina in Bengaluru; Editing by Kim Coghill and Mark Potter
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