CDP: DRAFT FINANCIAL STATEMENTS AND CONSOLIDATED FINANCIAL STATEMENTS AS AT 31/12/2018 APPROVED (1)
Strengthening capital position: Parent Company’s equity at 24.8 billion euro (24.4 billion euro in 2017), consolidated equity at 36.7 billion euro (35.9 billion euro in 2017)
Sustainable development: a structural process has been initiated to integrate the principles of economic, environmental and social sustainability into the strategic choices and operations of the CDP Group.
Rome, 28 March 2019 - h 6:23 pm.
The Board of Directors of Cassa depositi e prestiti S.p.A. (CDP), chaired by Massimo Tononi, approved the draft separate financial statements and the consolidated financial statements at 31 December 2018, as well as the 2018 consolidated non-financial statement of the CDP Group pursuant to Legislative Decree no. 254/2016 submitted by the Chief Executive Officer Fabrizio Palermo. The draft financial statements will be submitted for approval to the Shareholders’ Meeting, which will be called by the Board of Directors.
CDP Group in support of the Italian economy: new lending and activated resources
The results for 2018 confirmed the key role of CDP Group in supporting the Italian economy. The Group provided 36 billion euro in new lending (up 6.9% compared to 33.7 billion in the previous year) and, with its activity, attracted 27 billion euro of additional resources from private investors and other local, national and supranational institutions, activating a total of 63 billion euro in investments.
To support Enterprises - through loans, investments and guarantees offered by the Group - 30.2 billion euro were mobilised (84% of the total).
5.5 billion euro were mobilised in favour of the Government, Public Administration and Infrastructure sector (15% of the total), while - finally - 0.3 billion euro were allocated to investments in Real Estate (1% of the total).
The Parent Company CDP provided 16.6 billion euro in new lending. The action of the Parent Company concerned transactions in favour of Enterprises for 66% and initiatives to support the Government, Public Administration and Infrastructure and Real Estate sectors for the remaining 34%.
Financial Results (2)
Consolidated net income amounted to 4.3 billion euro (4.5 billion euro in 2017) of which 2.9 billion euro pertaining to the Parent Company (in line with 2017).
As at 31 December 2018, the Group’s total assets stood at 425.1 billion euro, up 1.3% compared to the previous financial year. Equity amounted to 36.7 billion euro (+2.3%) at consolidated level and 24.1 billion euro (+4.3%) at Group level.
Net income of the Parent Company amounted 2.5 billion euro, up 15.3%, mainly as a result of the increase in gross income, which amounted to 3.8 billion euro (+32.6%).
As at 31 December 2018, total assets amounted to 370 billion euro (+0.7%), mainly consisting of cash and cash equivalents for 167.9 billion euro (-3.7%), loans to customers and banks for 101.3 billion euro (-1.3%), debt securities for 60 billion euro (+24.9%) and equity investments for 33.1 billion euro (+2.5%).
With reference to liabilities, total funding amounted to 342.6 billion euro (+0.6%), of which 258 billion euro from postal savings bonds and passbook accounts (+2.1%)and the remaining 84.6 billion euro mainly from bank and bond issues. In 2018, the relaunch of postal savings continued, with a significant year-on-year improvement in CDP’s net funding (+3.8 billion euro compared to 2017), reflecting the effectiveness of the management actions taken and of the new agreement with Poste Italiane for the postal savings service for the three-year period 2018-2020. Equity totalled 24.8 billion euro (+1.5%).
Sustainable development: the new strategic approach
Through the new Business Plan, Cassa Depositi e Prestiti Group has decided, for the first time, to direct its strategic and operational approach towards the principles of Sustainable Development, which now represents a necessary step not only for institutions, but also for enterprises, the general public and the financial sector. For CDP, this is not a question of becoming aware of the issue of social and environmental impact, but of directing its awareness more effectively to promote sustainability.
In 2018, there were very positive results in relation to sustainable development issues. At environmental level a positive performance was recorded for all the aspects related to direct impact. In addition, the Group’s confirmed its commitment through the financial support to spreading renewable energy, energy efficiency projects, developing water networks and the switch to clean urban transport systems. At social level, the Group confirmed its commitment to supporting the local areas, and social and school building in particular. Specifically, in 2018 CDP received the “Company of excellence in real estate” award, for its work in urban transformation, reclaiming value to be returned to cities and families.
Concerning human resources management, in the first few months of 2019, CDP obtained the “Top Employer Italy” certification, thus confirming its dedication and commitment towards its employees.
Lastly, the Group’s commitment to promoting sustainable development continued through the preparation of the new Green, Social and Sustainability Bond Framework (the “CDP Framework”), on the one hand, and the issue of its first Sustainability “Hydro” Bond on the other.
The new 2019-2021 Business Plan
At the end of the financial year, the new Business plan for the three-year period 2019-2021 was presented, approved by the Board of Directors on 5 December 2018. It defines the Group’s objectives and strategic lines in light of Italy’s main economic and social challenges, the major global trends and the Sustainable Development Goals of the UN 2030 Agenda.
The plan focuses on activating a total of 203 billion euro in the next three years, contributing significantly to the sustainable growth of the country. Such a considerable figure will be obtained through the commitment of 111 billion euro in loans and the activation of 92 billion euro of loans from private investors and other local, national and supranational institutions.
All the actions planned will be carried out while ensuring an economic and financial balance and, therefore, the complete protection of savings that households entrust to CDP through postal savings bonds and passbook accounts.
To really support the country’s economic, social and environmental growth, CDP will arrange its operations along four main lines of action:
• CDP Enterprises: 83 billion euro to support — also via an enhanced physical channel and a digital channel — enterprises with an integrated offer, geared to their needs and focusing on innovation, growth and exports;
• CDP Infrastructure, Public Sector and Local Development: 25 billion euro with a proactive role in the promotion, realisation and financing of infrastructures, restarting a new partnership with the Public Administration focused on the local areas;
• CDP Cooperation: 3 billion euro to become a financing partner in developing countries;
• Large Strategic Equity Investments: strengthening of sectorial and industrial expertise, to manage the portfolio of equity investments also with an industrial approach over the long term.
Sustainability: through its new Business Plan, CDP intends to make a proactive contribution to the achievement of the objectives set by the United Nations’ 2030 Agenda, also signed by Italy. The integration of sustainability into CDP’s choices has been initiated through a gradual shift of investments towards initiatives with clear and measurable social and environmental impacts.
In order to achieve the targets of the Plan and in the light of the new business lines, an evolution in the business model is already in progress so as to respond effectively to the challenges of the country. The new model involves various actions. One of these has already been launched and involves the strengthening of human capital, the Group’s primary asset, with the attraction and development of talents. There will also be a streamlining in the organisation and in the operational and decision-making processes, as well as the creation of customer-oriented solutions. Lastly, to this end, both CDP’s offer and its communications with enterprises and the Public Administration will be digitalized.
Please note that the Independent Auditors are completing the audit of the separate financial statements and the consolidated financial statements as at 31 December 2018. The reclassified consolidated financial statements set out in the Annex are not subject to auditing by the Independent Auditors
The Manager in charge with preparing the company’s financial reports, Paolo Calcagnini, declares pursuant to Article 154-bis, paragraph 2, of the Consolidated Law on Finance that the accounting information contained in this press release corresponds to documentary evidence and the accounting books and records.
The 2018 Annual financial report, together with the certification pursuant to Article 154-bis, paragraph 5, of the Consolidated Law on Finance and the Independent Auditors and Board of Statutory Auditors’ Reports shall be available to the public at the Company’s registered office, on the CDP website and in any other manner provided for by the applicable law, within the legal time limits.
1 The financial statements and the reclassified financial tables presented and commented on in this release have been amended with respect to those previously in use, among others, following the first-time adoption (FTA) of IFRS 9, as required by Bank of Italy’s Circular no. 262/2005 on banks’ financial statements, as amended.
2 The economic results and equity information commented on refer to the figures of the consolidated financial statements and the figures of the separate financial statements reclassified according to the operational criteria applied at Group level and those applied at CDP S.p.A. level. These criteria were updated compared to the previous reporting dates. The comparative data do not include the effects of the adoption of the new IFRS 9 and IFRS 15, recognised on equity as at 1 January 2018. The financial statements, the reclassified financial tables and the statements of reconciliation are reported as an attachment.