Performance data

Revenue

Revenue in 2017 amounted to €74,639 million, an increase of €4,047 million (5.7%) compared with 2016. The rise mainly reflected an increase in revenue from the sale and transport of electricity (especially in end-user markets in Italy and Spain) as a result of greater quantities sold in an environment of rising prices, for grid management and for the sale of fuels, especially natural gas. In addition revenue from trading on international electricity markets also increased, essentially reflecting a rise in quantities handled in a context of rising prices.

Positive exchange rate developments, which saw gains posted in all countries with the exception of Argentina and the United States, were essentially offset by the impact of the changes in the scope of consolidation following the disposal of Slovenské elektrárne, Marcinelle Energie and Enel France and the acquisitions of Enel Distribuição Goiás (formerly CELG-D) and EnerNOC.

Revenue includes a number of extraordinary items associated with gains on the disposal of companies. In 2017 this mainly included the gain of €143 million on the disposal of the investment in Electrogas in Chile.

In 2016, it had mainly regarded the gain from the sale of GNL Quintero (an associate in which the Group held 20%) of €173 million and the gain of €124 million on the sale of Hydro Dolomiti Enel.

The following table reports developments in revenue by geographical area.

Gross operating margin

The gross operating margin in 2017 totaled €15,653 million, up €377 million (2.5%) compared with 2016, despite a negative impact of €225 million from the change in the scope of consolidation – mainly due to the deconsolidation of Slovenské elektrárne and EGPNA REP and the acquisition of Enel Distribuição Goiás (formerly CELG-D) and EnerNOC – and an unfavorable context attributable to adverse weather and water conditions, which penalized Group performance. In addition to exchange rate gains, the increase in the gross operating margin reflected the implementation of the investment plan over the past few years and the efficiency plans pursued by the Group. The following table reports gross operating margin by geographical area.

The ordinary gross operating margin amounted to €15,555 million, up €381 million on 2016 (+2.5%). Extraordinary items for 2017, which are not reflected in the ordinary gross operating margin, amounted to €98 million, including:

• the gain of €143 million on the sale of Electrogas; and
• the losses of €45 million posted in South America from the abandonment of hydroelectric projects in Chile and Colombia.

In addition, in 2016 extraordinary items amounted to €101 million and included:

• the gains on the sale of GNL Quintero and Hydro Dolomiti Enel for €173 million and €124 million respectively;
• the losses recognized following the definitive abandonment of the development of a number of hydroelectric projects in Chile and Peru (about €196 million).

The following table reports developments in the ordinary gross operating margin by segment.

Operating income

Operating income in 2017 amounted to €9,792 million, an increase of €871 million compared with 2016 (€8,921 million), with a decrease in depreciation, amortization and impairment losses of €494 million. The latter was almost entirely attributable to the greater impairment recognized in 2016 than in 2017. In 2016, impairment regarded the writedown of the value of water usage rights for hydroelectric projects on the rivers Neltume and Choshuenco in Chile, which face procedural difficulties (€273 million), upstream gas assets (€55 million), the writedown of Marcinelle Energie following the application of IFRS 5 (€51 million), as well as the writedowns recognized following impairment testing of the Enel Green Power Romania CGU (€130 million) and the Nuove Energie CGU (€92 million). In 2017, the only impairment recognized regarded the geothermal assets in Germany under development through Erdwärme Oberland GmbH (€42 million).

The following table reports developments in operating income by geographical area.

Ordinary operating income, which in addition to not including the items excluded from ordinary gross operating margin does not consider the effects of the impairment noted above, amounted to €9,736 million, an increase of €301 million (3.2%) on 2016.

The following table reports developments in ordinary operating income by geographical area.

Net income

Net income attributable to shareholders of the Parent Company amounted to €3,779 million in 2017, compared with €2,570 million in 2016. More specifically, the increase in operating income improved further with the reduction in financial expense on the debt, the gain from the disposal of Bayan Resources and the differences between the two years in the impact of the writedown of the investment in Slovak Power Holding and the financial receivable in respect of the disposal of an interest in that company.

In addition, taxes decreased, mainly due to the reduction in the rate of corporate income tax (IRES) from 27.5% to 24% in Italy and the adjustment of the deferred taxation of companies resident in the United States following the tax reform approved in December 2017, which reduced the corporate income tax rate from 35% to 21%.

Ordinary net income attributable to shareholders of the Parent Company del 2017 in 2017 amounted to €3,709 million (€3,243 million in 2016), an increase of €466 million on 2016. The following table provides a reconciliation of net income and ordinary net income attributable to shareholders of the Parent Company, reporting the non-ordinary items and their respective impacts on net income, excluding the associated tax effects and non-controlling interests.