The representation of performance by business area presented here is based on the approach used by management in monitoring Group performance for the two periods under review, taking account of the operational model adopted by the Group as described above.
With regard to disclosures for operating segments, beginning with the close of the accounts at September 30, 2019, the Enel Group has changed its primary and secondary reporting segments in accordance with the provisions of IFRS 8. Specifically, bearing in mind that in 2019 management began to report performance by business area, the Group has therefore adopted the following reporting sectors:
- Primary sector: business area;
- Secondary sector: geographical area.
The business area is therefore the main discriminant in the analyzes performed and decisions taken by the management of the Enel Group, and is fully consistent with the internal reporting prepared for these purposes since the results are measured and evaluated first and foremost for each business area and only thereafter are they broken down by country. The following chart outlines these organizational arrangements.
In particular, the new organization continues to be based on matrix of Business Lines (Thermal Generation and Trading, Enel Green Power, Infrastructure and Networks, End-user Markets, Enel X, Services and Holding/Other) and geographical areas (Italy, Iberia, Europe and Euro-Mediterranean Affairs, Latin America, North America, Africa, Asia and Oceania, Central/Holding).
Finally, it should be noted that with effect from September 2019, the Latin America area connected with the Enel Green Power Business Line also includes the countries Panama, Costa Rica, Guatemala, El Salvador and Nicaragua, which had previously been reported in the North and Central America geographical area (now renamed North America and consisting of the following countries: United States, Canada and Mexico). In order to ensure full comparability of the figures commented here in the light of the new breakdown of the primary and secondary reporting sectors for IFRS 8 disclosure purposes and of the reallocation of countries in the Enel Green Power segment, the comparative figures for 2018 have been restated appropriately.
Results by business area for 2019 and 2018
Results for 2019 (1)
Millions of euro | Thermal Generation and Trading | Enel Green Power | Infrastructure and Networks | End-user Markets | Enel X | Services | Other, eliminations and adjustments | Total |
Revenue and other income from third parties | 30,519 | 7,360 | 20,092 | 19,482 | 967 | 1,901 | 6 | 80,327 |
Revenue and other income from transactions with other segments | 1,532 | 373 | 1,697 | 13,062 | 163 | 80 | (16,907) | - |
Total revenue and other income | 32,051 | 7,733 | 21,789 | 32,544 | 1,130 | 1,981 | (16,901) | 80,327 |
Net income/(expense) from commodity risk management | (676) | 14 | - | (71) | - | - | - | (733) |
Gross operating margin | 1,395 | 4,604 | 8,278 | 3,287 | 158 | 126 | (144) | 17,704 |
Depreciation, amortization, and impairment losses | 4,889 | 1,328 | 3,001 | 1,124 | 256 | 201 | 27 | 10,826 |
Operating income | (3,494) | 3,276 | 5,277 | 2,163 | (98) | (75) | (171) | 6,878 |
Capital expenditure | 851 | 4,293(2) | 3,905 | 449 | 270 | 134 | 45 | 9,947 |
(1) Segment revenue includes both revenue from third parties and revenue flows between the segments. An analogous approach was taken for other income and costs for the period.
(2) Does not include €4 million regarding units classified as “held for sale”.
Results for 2018 (1)(2)
Millions of euro | Thermal Generation and Trading | Enel Green Power | Infrastructure and Networks | End-user Markets | Enel X | Services | Other, eliminations and adjustments | Total |
Revenue and other income from third parties | 26,630 | 7,613 | 18,250 | 20,340 | 849 | 1,878 | 15 | 75,575 |
Revenue and other income from transactions with other segments | 977 | 443 | 1,718 | 13,431 | 157 | 60 | (16,786) | - |
Total revenue and other income | 27,607 | 8,056 | 19,968 | 33,771 | 1,006 | 1,938 | (16,771) | 75,575 |
Net income/(expense) from commodity risk management | 640 | (162) | - | (11) | - | 65 | - | 532 |
Gross operating margin | 1,117 | 4,608 | 7,539 | 3,079 | 124 | 85 | (201) | 16,351 |
Depreciation, amortization, and impairment losses | 1,235 | 1,103 | 2,752 | 1,121 | 105 | 123 | 12 | 6,451 |
Operating income | (118) | 3,505 | 4,787 | 1,958 | 19 | (38) | (213) | 9,900 |
Capital expenditure | 839 | 2,784(3) | 3,830 | 374 | 183 | 106 | 36 | 8,152 |
(1) Segment revenue includes both revenue from third parties and revenue flows between the segments. An analogous approach was taken for other income and costs for the period.
(2)The figures have been restated to ensure comparability with the results for 2019, which are reported using business areas as the primary reporting segment.
(3)Does not include €378 million regarding units classified as “held for sale”.
In addition to the above, the Group monitors performance by geographical area, classifying results by Region/Country. In the table below, gross operating margin is shown for the two periods under review with the goal of providing a view of performance not only by Business Line, but also by Region/ Country
Gross operating margin
Millions of euro | Thermal Generation and Trading | Enel Green Power | Infrastructure and Networks | End-user Markets | Enel X | Services | Other | Total | ||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | 2019 | 2018 | Change | 2019 | 2018 | Change | 2019 | 2018 | Change | 2019 | 2018 | Change | 2019 | 2018 | Change | 2019 | 2018 | Change | |
Italy | (14) | 22 | (36) | 1,240 | 1,220 | 20 | 3,906 | 3,679 | 227 | 2,314 | 2,233 | 81 | 13 | 31 | (18) | 169 | 119 | 50 | - | - | - | 7,628 | 7,304 | 324 |
Iberia | 590 | 425 | 165 | 358 | 361 | (3) | 2,025 | 1,965 | 60 | 715 | 676 | 39 | 38 | 51 | (13) | 66 | 80 | (14) | - | - | - | 3,792 | 3,558 | 234 |
Latin America | 642 | 469 | 173 | 2,218 | 2,201 | 17 | 2,259 | 1,763 | 496 | 243 | 158 | 85 | 64 | 56 | 8 | (123) | (104) | (19) | - | - | - | 5,303 | 4,543 | 760 |
Argentina | 165 | 142 | 23 | 51 | 46 | 5 | 271 | 173 | 98 | 2 | (16) | 18 | - | - | - | (1) | (1) | - | - | - | - | 488 | 344 | 144 |
Brazil | 107 | 7 | 100 | 335 | 395 | (60) | 1,144 | 815 | 329 | 149 | 100 | 49 | (1) | - | (1) | (49) | (42) | (7) | - | - | - | 1,685 | 1,275 | 410 |
Chile | 211 | 124 | 87 | 899 | 877 | 22 | 222 | 228 | (6) | 17 | 19 | (2) | 26 | 19 | 7 | (72) | (61) | (11) | - | - | - | 1,303 | 1,206 | 97 |
Colombia | 14 | 51 | (37) | 620 | 544 | 76 | 399 | 364 | 35 | 60 | 42 | 18 | 38 | 37 | 1 | - | - | - | - | - | - | 1,131 | 1,038 | 93 |
Peru | 145 | 145 | - | 162 | 156 | 6 | 223 | 183 | 40 | 15 | 13 | 2 | 1 | - | 1 | (1) | - | (1) | - | - | - | 545 | 497 | 48 |
Panama | - | - | - | 112 | 113 | (1) | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | 112 | 113 | (1) |
Other countries | - | - | - | 39 | 70 | (31) | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | 39 | 70 | (31) |
Europe and Euro-Mediterranean Affairs | 209 | 233 | (24) | 112 | 115 | (3) | 107 | 152 | (45) | 15 | 12 | 3 | - | 3 | (3) | 5 | 1 | 4 | - | - | - | 448 | 516 | (68) |
Romania | (2) | - | (2) | 75 | 62 | 13 | 107 | 152 | (45) | 15 | 12 | 3 | 6 | 3 | 3 | 5 | 1 | 4 | - | - | - | 206 | 230 | (24) |
Russia | 209 | 233 | (24) | (1) | (1) | - | - | - | - | - | - | - | (2) | - | (2) | - | - | - | - | - | - | 206 | 232 | (26) |
Other countries | 2 | - | 2 | 38 | 54 | (16) | - | - | - | - | - | - | (4) | - | (4) | - | - | - | - | - | - | 36 | 54 | (18) |
North America | (18) | (6) | (12) | 737 | 538 | 199 | - | - | - | - | - | - | 80 | 3 | 77 | - | - | - | - | - | - | 799 | 535 | 264 |
United States and Canada | (16) | (6) | (10) | 658 | 398 | 260 | - | - | - | - | - | - | 80 | 3 | 77 | - | - | - | - | - | - | 722 | 395 | 327 |
Mexico | (2) | - | (2) | 79 | 140 | (61) | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | 77 | 140 | (63) |
Africa, Asia and Oceania | - | - | - | 62 | 58 | 4 | - | - | - | - | - | - | (1) | (4) | 3 | - | - | - | - | - | - | 61 | 54 | 7 |
South Africa | - | - | - | 58 | 54 | 4 | - | - | - | - | - | - | - | (4) | 4 | - | - | - | - | - | - | 58 | 50 | 8 |
India | - | - | - | 8 | 9 | (1) | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | 8 | 9 | (1) |
Other countries | - | - | - | (4) | (5) | 1 | - | - | - | - | - | - | (1) | - | (1) | - | - | - | - | - | - | (5) | (5) | - |
Other | (14) | (26) | 12 | (123) | 115 | (238) | (19) | (20) | 1 | - | - | - | (36) | (16) | (20) | 9 | (11) | 20 | (144) | (201) | 57 | (327) | (159) | (168) |
Total | 1,395 | 1,117 | 278 | 4,604 | 4,608 | (4) | 8,278 | 7,539 | 739 | 3,287 | 3,079 | 208 | 158 | 124 | 34 | 126 | 85 | 41 | (144) | (201) | 57 | 17,704 | 16,351 | 1,353 |
Thermal Generation and Trading
Operations
Net electricity generation
Millions of kWh | ||||
2019 | 2018 | Change | ||
Coal-fired plants | 37,592 | 64.366 | (26,774) | -41.6% |
Fuel-oil and turbo-gas plants | 20,887 | 24,832 | (3,945) | -15.9% |
Combined-cycle plants | 44,980 | 38,134 | 6,846 | 18.0% |
Nuclear plants | 26,279 | 24,067 | 2,212 | 9.2% |
Total net generation | 129,738 | 151,399 | (21,661) | -14.3% |
- of which Italy | 22,604 | 27,757 | (5,153) | -18.6% |
- of which Iberia | 51,312 | 62,020 | (10,708) | -17.3% |
- of which Latin America | 23,388 | 22,441 | 947 | 4.2% |
- of which Europe and Euro-Mediterranean Affairs | 32,434 | 39,181 | (6,747) | -17.2% |
The decrease in net generation was essentially due to a sharp decrease in coal generation in the amount of 26,774 million kWh, including Iberia (14,673 million kWh), Italy (7,941 million kWh) and Russia (5,239 million kWh) as a result of the decline in their competitiveness. This was partially offset by an increase of 6,846 million kWh in combined-cycle generation, mainly in Italy (3,013 million kWh), Iberia (2,731 million kWh) and Latin America (1,092 million kWh). The increase in nuclear generation can be attributed to the increased use of nuclear energy in Iberia due to poor water availability.
Net efficient generation capacity
MW | ||||
at Dec. 31, 2019 | at Dec. 31, 2018 | Change | ||
Coal-fired plants | 11,695 | 15,828 | (4,133) | -26.1% |
Fuel-oil and turbo-gas plants | 12,211 | 12,250 | (39) | -0.3% |
Combined-cycle plants | 14,991 | 15,021 | (30) | -0.2% |
Nuclear plants | 3,318 | 3,318 | - | - |
Total | 42,215 | 46,417 | (4,202) | -9.1% |
- of which Italy | 13,480 | 13,613 | (133) | -1.0% |
- of which Iberia | 15,957 | 16,192 | (235) | -1.5% |
- of which Latin America | 7,523 | 7,734 | (211) | -2.7% |
- of which Europe and Euro-Mediterranean Affairs | 5,255 | 8,878 | (3,623) | -40.8% |
The decrease in net efficient generation capacity reflects the reduced use of coal-fired plants, especially in Russia (3,623 MW) following the disposal of the Reftinskaya plant mentioned earlier. More generally, “thermal” and “coal” revenue, i.e., from thermal and coal-fired plants respectively, has been declining steadily as a result of corporate strategic choices inspired by a sustainable business model pursuing objectives to combat climate change and achieve decarbonization, as shown in the following table (including percentage out of total):
Millions of euro | 2019 | 2018 |
«Thermal» revenue | 10,322 | 10,894 |
«Coal» revenue | 2,827 | 4,043 |
Nuclear revenue | 1,296 | 1,079 |
Percentage of thermal revenue out of total | 12.8% | 14.4% |
Percentage of coal revenue out of total | 3.5% | 5.3% |
Percentage of nuclear revenue out of total | 1.6% | 1.4% |
Sustainability report - Financial metrics
Performance
Millions of euro | ||||
2019 | 2018 | Change | ||
Revenue | 32,051 | 27,607 | 4,444 | 16.1% |
Gross operating margin | 1,395 | 1,117 | 278 | 24.9% |
Operating income | (3,494) | (118) | (3,376) | - |
Capital expenditure | 851 | 839 | 12 | 1.4% |
The following tables show a breakdown of performance by Region/Country in 2019.
Revenue
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 23,688 | 18,954 | 4,734 | 25.0% |
Iberia | 6,261 | 6,329 | (68) | -1.1% |
Latin America | 1,915 | 1,726 | 189 | 11.0% |
- of which Argentina | 323 | 227 | 96 | 42.3% |
- of which Brazil | 289 | 270 | 19 | 7.0% |
- of which Chile | 828 | 739 | 89 | 12.0% |
- of which Colombia | 110 | 126 | (16) | -12.7% |
- of which Peru | 365 | 364 | 1 | 0.3% |
North America | 29 | 3 | 26 | - |
Europe and Euro-Mediterranean Affairs | 956 | 1,054 | (98) | -9.3% |
- of which Romania | 42 | 55 | (13) | -23.6% |
- of which Russia | 911 | 999 | (88) | -8.8% |
- of which other countries | 3 | - | 3 | - |
Other | 54 | 81 | (27) | -33.3% |
Eliminations and adjustments | (852) | (540) | (312) | -57.8% |
Total | 32,051 | 27,607 | 4,444 | 16.1% |
The change in revenue is mainly attributable to the item “Sale of commodities under contracts with physical delivery”, reflecting reclassifications, with no impact on margins, linked to the application of the IFRIC Agenda Decision of March 2019 to non-financial transactions with physical delivery measured at fair value in accordance with IFRS 9. For more information, please see section 4.3 of the notes to the consolidated financial statements.
Gross operating margin
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | (14) | 22 | (36) | - |
Iberia | 590 | 425 | 165 | 38.8% |
Latin America | 642 | 469 | 173 | 36.9% |
- of which Argentina | 165 | 142 | 23 | 16.2% |
- of which Brazil | 107 | 7 | 100 | - |
- of which Chile | 211 | 124 | 87 | 70.2% |
- of which Colombia | 14 | 51 | (37) | -72.5% |
- of which Peru | 145 | 145 | - | - |
North America | (18) | (6) | (12) | - |
Europe and Euro-Mediterranean Affairs | 209 | 233 | (24) | -10.3% |
- of which Romania | (2) | - | (2) | - |
- of which Russia | 209 | 233 | (24) | -10.3% |
- of which other countries | 2 | - | 2 | - |
Other | (14) | (26) | 12 | 46.2% |
Total | 1,395 | 1,117 | 278 | 24.9% |
The increase in the gross operating margin in 2019 is mainly due to:
- an increase of €173 million in the margin in Latin America, mainly attributable to the indemnity in the amount of €80 million received from a major customer for having exercised the withdrawal option in advance and to the improvement in the margin of the Fortaleza plant (€108 million) due to a decrease in provisioning costs;
- an increase of €165 million in Iberia, essentially attributable to the following factors:
- an increase of €279 million in the margin on nuclear generation, mainly due to an increase in volumes generated and in prices, as well as a reduction in taxes on nuclear generation (€43 million);
- a reduction of €63 million in taxes and duties on thermal generation due, above all, to suspension of taxes on power generation and on the consumption of hydrocarbons used to generate power in accordance with Royal Decree no. 15/2018 of October 5, 2018;
- an increase in writedowns of fuel, consumables and spare parts inventories at a number of coal-fired plants that underwent impairment testing, totaling €103 million, because their value was deemed non-recoverable through operations;
- deterioration of €90 million in the results on commodity contracts measured at fair value;
- decrease of €36 million in the margin in Italy, mainly due to:
- an increase in writedowns of fuel, consumables, and spare parts inventories at a number of coal-fired plants, totaling €205 million, because their value was deemed non-recoverable through operations;
- recognition of a gain of €108 million by Enel Produzione on the disposal of the Mercure power plant, which was only partially offset by an increase in provisions for environmental costs in accordance with the contract and related to the industrial site;
- a decrease of €65 million in costs for environmental compliance in thermal generation;
- a decrease of €24 million in the margin posted for Europe and Euro-Mediterranean Affairs, recognized mainly in Russia.
Operating income
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | (1,908) | (248) | (1,660) | - |
Iberia | (1,650) | (274) | (1,376) | - |
Latin America | 68 | 266 | (198) | -74.4% |
- of which Argentina | 100 | 89 | 11 | 12.4% |
- of which Brazil | 94 | (1) | 95 | - |
- of which Chile | (233) | 30 | (263) | - |
- of which Colombia | (2) | 37 | (39) | - |
- of which Peru | 109 | 111 | (2) | -1.8% |
North America | (19) | (6) | (13) | - |
Europe and Euro-Mediterranean Affairs | 30 | 170 | (140) | -82.4% |
- of which Romania | (1) | - | (1) | - |
- of which Russia | 31 | 170 | (139) | -81.8% |
- of which other countries | - | - | - | - |
Other | (15) | (26) | 11 | 42.3% |
Eliminations and adjustments | - | - | - | - |
Total | (3,494) | (118) | (3,376) | - |
The decrease in operating income is due to the increase of €3,654 million in depreciation, amortization and impairment, despite the improvement in the gross operating margin. More specifically, the increase in depreciation, amortization and impairment mainly concerned:
- impairment in Italy, Spain, Chile and Russia for coal-fired plants totaling €4,010 million, as described in detail in the “Operating income” section of “Group performance”;
- an increase in depreciation and amortization in application of IFRS 16 (€34 million).
Capital expenditure
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 189 | 172 | 17 | 9.9% |
Iberia | 388 | 345 | 43 | 12.5% |
Latin America | 193 | 251 | (58) | -23.1% |
Europe and Euro-Mediterranean Affairs | 79 | 70 | 9 | 12.9% |
Other | 2 | 1 | 1 | - |
Total | 851 | 839 | 12 | 1.4% |
The increase in capital expenditure is mainly attributable to Italy (€17 million) and Iberia (€43 million) and concerns, above all, plant maintenance and safety upgrading. These effects were partially offset by a decrease of €58 million in capital expenditure in Latin America, particularly in Argentina and Chile, regarding coal-fired and combined-cycle plants.
Enel Green Power
Operations
Net electricity generation
Millions of kWh | ||||
2019 | 2018 | Change | ||
Hydroelectric | 62,580 | 65,893 | (3,313) | -5.0% |
Geothermal | 6,148 | 5,881 | 267 | 4.5% |
Wind | 26,668 | 22,161 | 4,507 | 20.3% |
Solar | 3,974 | 4,897 | (923) | -18.8% |
Other sources | 21 | 108 | (87) | -80.6% |
Total net generation | 99,391 | 98,940 | 451 | 0.5% |
- of which Italy | 24,308 | 25,476 | (1,168) | -4.6% |
- of which Iberia | 10,090 | 12,172 | (2,082) | -17.1% |
- of which Latin America | 48,448 | 48,137 | 311 | 0.6% |
- of which Europe and Euro-Mediterranean Affairs | 2,005 | 1,895 | 110 | 5.8% |
- of which North America | 12,969 | 9,752 | 3,217 | 33.0% |
- of which Africa, Asia and Oceania | 1,571 | 1,508 | 63 | 4.2% |
Net electricity generation 2019 increased slightly from 2018 due to increases in wind and geothermal production, which were partially offset by decreases in hydroelectric and solar power generation. The most significant changes in wind power came in the United States and in Iberia, where production increased by 4,496 million kWh and 439 million kWh, respectively. These increases were partially offset by decreases in wind power generation in Mexico (down 759 million kWh) due, in part, to the sale of a number of companies in September 2018.
The increase in geothermal generation came mainly in the United States (up 285 million kWh). The decrease in hydro generation was due mainly to reduced water availability in Italy and Iberia, only partially offset by an increase in Latin America (up 458 million kWh), where output varied throughout the region. Of particular note were increases in Brazil (+940 million kWh), Colombia (+857 million kWh), and Peru (+462 million kWh), and these increases were offset by decreases in Argentina (-350 million kWh), Chile (-899 million kWh), and Panama (-308 million kWh).
Net efficient generation capacity
MW | ||||
at Dec. 31, 2019 | at Dec. 31, 2018 | Change | ||
Hydroelectric | 27,830 | 27,844 | (14) | -0.1% |
Geothermal | 878 | 804 | 74 | 9.2% |
Wind | 10,327 | 8,190 | 2,137 | 26.1% |
Solar | 3,094 | 2,322 | 772 | 33.2% |
Other sources | 5 | 43 | (38) | -88.4% |
Total net power efficiency | 42,134 | 39,203 | 2,931 | 7.5% |
- of which Italy | 13,972 | 14,011 | (39) | -0.3% |
- of which Iberia | 7,391 | 6,525 | 866 | 13.3% |
- of which Latin America | 13,676 | 13,869 | (193) | -1.4% |
- of which Europe and Euro-Mediterranean Affairs | 1,037 | 883 | 154 | 17.4% |
- of which North America | 5,282 | 3,220 | 2,062 | 64.0% |
- Africa, Asia and Oceania | 776 | 695 | 81 | 11.7% |
Net power efficiency capacity for 2019 increased from 2018, mainly in the United States due to the acquisition by Enel Green Power North America (EPGNA, now named Enel North America) of 13 companies that own wind, geothermal and solar plants, as well as to an increase in power generation capacity at the High Lonesome and Roadrunner plants. Wind and solar power generation capacity also increased in Iberia.
Performance
Millions of euro | ||||
2019 | 2018 | Change | ||
Revenue | 7,733 | 8,056 | (323) | -4.0% |
Gross operating margin | 4,604 | 4,608 | (4) | -0.1% |
Operating income | 3,276 | 3,505 | (229) | -6.5% |
Capital expenditure | 4,293(1) | 2,784(2) | 1,509 | 54.2% |
(1) The figure does not include €4 million regarding units classified as “held for sale”.
(2) The figure does not include €378 million regarding units classified as “held for sale”.
The following tables show a breakdown of performance by country in 2019.
Revenue(1)
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 1,918 | 2,084 | (166) | -8.0% |
Iberia | 653 | 716 | (63) | -8.8% |
Latin America | 3,692 | 3,843 | (151) | -3.9% |
- of which Argentina | 64 | 59 | 5 | 8.5% |
- of which Brazil | 694 | 676 | 18 | 2.7% |
- of which Chile | 1,489 | 1,584 | (95) | -6.0% |
- of which Colombia | 1,007 | 941 | 66 | 7.0% |
- of which Peru | 201 | 334 | (133) | -39.8% |
- of which Panama | 169 | 151 | 18 | 11.9% |
- of which other countries | 68 | 98 | (30) | -30.6% |
North America | 1,115 | 860 | 255 | 29.7% |
- of which the United States | 956 | 564 | 392 | 69.5% |
- of which Mexico | 159 | 296 | (137) | -46.3% |
Europe and Euro-Mediterranean Affairs | 271 | 255 | 16 | 6.3% |
- of which Romania | 175 | 173 | 2 | 1.2% |
- of which Greece | 86 | 73 | 13 | 17.8% |
- of which Bulgaria | 8 | 9 | (1) | -11.1% |
- of which other countries | 2 | - | 2 | - |
Africa, Asia and Oceania | 107 | 101 | 6 | 5.9% |
Other | 105 | 316 | (211) | -66.8% |
Eliminations and adjustments | (128) | (119) | (9) | -7.6% |
Total | 7,733 | 8,056 | (323) | -4.0% |
(1) These figures have been adjusted for the purposes of comparison with those of December 2019 to take account of the fact that Panama, Costa Rica, Guatemala, El Salvador and Nicaragua, which were previously included in the North and Central America geographical area, are now included within Latin America.
Gross operating margin(1)
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 1,240 | 1,220 | 20 | 1.6% |
Iberia | 358 | 361 | (3) | -0.8% |
Latin America | 2,218 | 2,201 | 17 | 0.8% |
- of which Argentina | 51 | 46 | 5 | 10.9% |
- of which Brazil | 335 | 395 | (60) | -15.2% |
- of which Chile | 899 | 877 | 22 | 2.5% |
- of which Colombia | 620 | 544 | 76 | 14.0% |
- of which Peru | 162 | 156 | 6 | 3.8% |
- of which Panama | 112 | 113 | (1) | -0.9% |
- of which other countries | 39 | 70 | (31) | -44.3% |
North America | 737 | 538 | 199 | 37.0% |
- of which the United States | 658 | 398 | 260 | 65.3% |
- of which Mexico | 79 | 140 | (61) | -43.6% |
Europe and Euro-Mediterranean Affairs | 112 | 115 | (3) | -2.6% |
- of which Romania | 75 | 62 | 13 | 21.0% |
- of which Russia | (1) | (1) | - | - |
- of which Greece | 35 | 49 | (14) | -28.6% |
- of which Bulgaria | 6 | 6 | - | - |
- of which other countries | (3) | (1) | (2) | - |
Africa, Asia and Oceania | 62 | 58 | 4 | 6.9% |
Other | (123) | 115 | (238) | - |
Total | 4,604 | 4,608 | (4) | -0.1% |
(1) These figures have been adjusted for the purposes of comparison with those of December 2019 to take account of the fact that Panama, Costa Rica, Guatemala, El Salvador and Nicaragua, which were previously included in the North and Central America geographical area, are now included within Latin America.
Gross operating margin decreased by €4 million from 2018, which was essentially due to the following:
- an increase of €199 million in the margin in North America, mainly due to:
- an increase of €260 million in the margin the United States due essentially to the increase (€92 million) related to the change in the scope of consolidation following the acquisition by Enel North America (formerly Enel Green Power North America) of 13 companies sold by Enel Green Power North America Renewable Energy Partners LLC (EGPNA REP) and to the negative goodwill on the transaction (€106 million); to the negative goodwill related to the purchase of Tradewind Energy (€75 million), which was partially offset by the company’s negative margin (-€53 million); to the gains on the disposal of the projects Outlaw (€22 million) and Gratiot (€20 million); to the increase in tax partnership income related to the companies High Lonesome Wind Power (€87 million) and Roadrunner Solar Project (€67 million), which were partially offset by decreases in such income from Diamond Vista (-€40 million) and Rattlesnake Creek (-€39 million);
- a reduction of €61 million in the margin in Mexico due mainly to the change in the scope of consolidation following the sale of eight companies from Project Kino at the end of September 2018;
- an increase of €17 million in the margin in Latin America, mainly due to:
- the increase of €76 million in the margin in Colombia, due essentially to an increase in revenue on electricity sales (€73 million) as a result of an increase in average prices and in quantities traded on the power exchange, and lower costs for electricity purchases and transport (€78 million) related to lower quantities purchased, and to a decrease in fuel consumption (€15 million), partially offset by an increase in costs for ancillary services related to the electricity business (€82 million);
- an increase of €22 million in the margin in Chile, essen tially attributable to recognition of €80 million in penalty revenue by Enel Generación Chile due to a major industrial client exercising the right to early withdrawal from a long-term electricity provisioning agreement, partially offset by a loss on the electricity margin (€62 million) as a result of a decrease in production;
- a decrease of €60 million in the margin in Brazil, where the increase in revenue from electricity sales as a result of greater generation, partly eroded by a reduction in spot prices, was more than offset by an increase in costs for the purchase of electricity and the change in the scope of consolidation related to the disposal of three plants;
- decrease of €31 million in the margin in other countries due mainly to a decline in revenue from the sale of electricity in Costa Rica and Guatemala as a result of decreases in quantities generated and the change in the scope of consolidation that took place in Uruguay in December 2018;
- an increase of €20 million in the margin in Italy due essentially to an increase in the sales price of electricity despite the lower volume of hydro generation, partially offset by the effect of the recognition in the previous year of the gain on the sale of EF Solare Italia (€65 million);
- a reduction of €238 million in the margin that mainly reflected the recognition in the previous year of the gain on the sale of eight Project Kino companies in Mexico at the end of September 2018, as well as the fair value measurement of the Group’s 20% interest in the companies (€190 million) and the gain on the sale of a number of companies in Uruguay (€18 million).
Operating income(1)
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 909 | 828 | 81 | 9.8% |
Iberia | 183 | 208 | (25) | -12.0% |
Latin America | 1,809 | 1,776 | 33 | 1.9% |
- of which Argentina | 38 | 39 | (1) | -2.6% |
- of which Brazil | 250 | 309 | (59) | -19.1% |
- of which Chile | 728 | 699 | 29 | 4.1% |
- of which Colombia | 560 | 488 | 72 | 14.8% |
- of which Peru | 123 | 107 | 16 | 15.0% |
- of which Panama | 96 | 98 | (2) | -2.0% |
- of which other countries | 14 | 36 | (22) | -61.1% |
North America | 418 | 364 | 54 | 14.8% |
- of which the United States | 367 | 270 | 97 | 35.9% |
- of which Mexico | 51 | 94 | (43) | -45.7% |
Europe and Euro-Mediterranean Affairs | 58 | 195 | (137) | -70.3% |
- of which Romania | 49 | 40 | 9 | 22.5% |
- of which Russia | - | (1) | 1 | - |
- of which Greece | 10 | 154 | (144) | -93.5% |
- of which Bulgaria | 3 | 3 | - | - |
- of which other countries | (4) | (1) | (3) | - |
Africa, Asia and Oceania | 24 | 19 | 5 | 26.3% |
Other | (125) | 115 | (240) | - |
Eliminations and adjustments | - | - | - | - |
Total | 3,276 | 3,505 | (229) | -6.5% |
(1) These figures have been adjusted for the purposes of comparison with those of December 2019 to take account of the fact that Panama, Costa Rica, Guatemala, El Salvador and Nicaragua, which were previously included in the North and Central America geographical area, are now included within Latin America.
In 2019, operating income, taking account of depreciation, amortization and impairment losses in the amount of €1,328 million (€1,103 million in 2018), decreased by €229 million compared with 2018 due to an increase in depreciation and amortization in the United States (€116 million) related mainly to the change in the scope of consolidation noted earlier and the start of operations at the Rattlesnake, Hilltopper and Diamond Vista plants, the impairment losses on the assets of a number of wind projects that are no longer viable, and the fair value adjustment of hydroelectric projects classified as HFS (€36 million), as well as the recognition in the previous year of the reversal of impairment on the Hellas CGU (€117 million).
Capital expenditure(1)
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 240 | 252(3) | (12) | -4.8% |
Iberia | 765 | 246 | 519 | - |
Latin America | 1,055(2) | 654 | 401 | 61.3% |
North America | 1,744 | 1,322(4) | 422 | 31.9% |
Europe and Euro-Mediterranean Affairs | 189 | 139 | 50 | 36.0% |
Africa, Asia and Oceania | 274 | 142 | 132 | 93.0% |
Other | 26 | 29 | (3) | -10.3% |
Total | 4,293 | 2,784 | 1,509 | 54.2% |
(1) These figures have been adjusted for the purposes of comparison with those of December 2019 to take account of the fact that Panama, Costa Rica, Guatemala, El Salvador and Nicaragua, which were previously included in the North and Central America geographical area, are now included within Latin America.
(2) The figure does not include €4 million regarding units classified as “held for sale”.
(3) The figure does not include €3 million regarding units classified as “held for sale”.
(4) The figure does not include €375 million regarding units classified as “held for sale”.
Capital expenditure increased by €1,509 million compared with the previous year. More specifically, the change is attributable to:
- an increase of €519 million in capital expenditure in Iberia attributable mainly to wind farms (€364 million) and photovoltaic plants (€153 million);
- an increase of €422 million in capital expenditure in North America, mainly attributable to an increase of €237 million in the United States and of €74 million in Mexico for solar plants and to increases in capital expenditure for wind farms (€112 million) following a sharp increase in Mexico (€224 million), partially offset by a decrease in capital expenditure in the United States (€198 million);
- an increase of €401 million in capital expenditure in Latin America attributable mainly to wind farms (€274 million) and photovoltaic plants (€170 million), which was partially offset by a decrease in capital expenditure on hydroelectric plants (€90 million). The increase in capital expenditure was concentrated in Brazil;
- an increase of €132 million in capital expenditure in Africa, Asia and Oceania related mainly to wind farms (€82 million) following an increase in South Africa (€101 million), which was partially offset by decreases in capital expenditure in India (€19 million) and for solar plants (€50 million), mainly in Australia (€38 million);
- an increase of €50 million in capital expenditure by Europe and Euro-Mediterranean Affairs, mainly on wind farms in Russia and Greece.
Operations
Electricity distribution and transport networks
Millions of kWh | ||||
2019 | 2018 | Change | ||
Electricity transported on Enel’s network(1) | 504,027 | 484,377 | 19,650 | 4.1% |
- of which Italy | 224,587 | 226,460 | (1,873) | -0.8% |
- I of which beria | 126,454 | 124,865 | 1,589 | 1.3% |
- of which Latin America | 137,295 | 117,412 | 19,883 | 16.9% |
- of which Europe and Euro-Mediterranean Affairs | 15,691 | 15,640 | 51 | 0.3% |
End users (no.) | 73,258,840 | 72,945,664 | 313,176 | 0.4% |
End users with active smart meters (no.) | 44,668,538 | 43,770,085 | 898,453 | 2.1% |
(1) The figure for 2018 reflects a more accurate measurement of amounts transported.
The increase in energy transported on the network is mainly attributable to:
- Latin America (+16.9%) following the acquisition of Enel Distribuição São Paulo, a Brazilian electricity distribution company, on June 7, 2018;
- Romania (+0.3%), where the increase was mainly due to new connections of business customers (+21.4 GWh), which was partially offset by a decrease for residential customers (-21.1 GWh);
- Italy (-0.8%), where electricity distributed to end users totaled 224.58 TWh, a slight decrease from the previous year’s figure of 226.46 TWh. This reduction reflects declining demand among medium-voltage (-1.2 TWh) and high-voltage customers (-1 TWh). Demand was stable among low-voltage customers;
- Iberia (+1.3%), where the increase was due essentially to an increase in electricity transported by Edistribución Redes Digitales SL.
Average frequency of interruptions per customer
2019 | 2018 | Change | ||
SAIFI (average no.) | ||||
Italy | 1.9 | 1.8 | 0.1 | 5.6% |
Iberia | 1.4 | 1.6 | (0.2) | -12.5% |
Argentina | 6.0 | 6.7 | (0.7) | -10.4% |
Brazil | 5.8 | 6.2 | (0.4) | -6.5% |
Chile | 1.6 | 1.5 | 0.1 | 6.7% |
Colombia | 6.8 | 9.0 | (2.2) | -24.4% |
Peru | 2.8 | 2.8 | - | - |
Romania | 4.1 | 3.8 | 0.3 | 7.9% |
Average duration of interruptions per customer
2019 | 2018 | Change | ||
SAIDI (average min.) | ||||
Italy | 48.5 | 47.2 | 1.3 | 2.8% |
Iberia | 75.8 | 79.5 | (3.7) | -4.7% |
Argentina | 1,214.1 | 1,485.4 | (271.3) | -18.3% |
Brazil | 728.8 | 716.8 | 12.0 | 1.7% |
Chile | 184.1 | 178.0 | 6.1 | 3.4% |
Colombia | 666.6 | 710.0 | (43.4) | -6.1% |
Peru | 418.9 | 436.0 | (17.1) | -3.9% |
Romania | 169.6 | 173.8 | (4.2) | -2.4% |
As indicated in the tables, the most significant service interruptions occurred in Argentina, due in particular to faults in high-voltage transmission systems not operated by the Group.
2019 | 2018 | Change | ||
Network losses (avg. %) | ||||
Italy | 4.7 | 4.7 | - | - |
Iberia | 7.5 | 7.5 | - | - |
Argentina | 15.5 | 14.9 | 0.6 | 4.0% |
Brazil | 12.8 | 12.4 | 0.4 | 3.2% |
Chile | 5.0 | 5.0 | - | - |
Colombia | 7.7 | 7.7 | - | - |
Peru | 8.2 | 7.9 | 0.3 | 3.8% |
Romania | 9.7 | 9.8 | (0.1) | -1.0% |
Performance
Millions of euro | ||||
2019 | 2018 | Change | ||
Revenue | 21,789 | 19,968 | 1,821 | 9.1% |
Gross operating margin | 8,278 | 7,539 | 739 | 9.8% |
Operating income | 5,277 | 4,787 | 490 | 10.2% |
Capital expenditure | 3,905 | 3,830 | 75 | 2.0% |
The following tables shows a breakdown of performance by country in 2019.
Revenue
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 7,647 | 7,672 | (25) | -0.3% |
Iberia | 2,724 | 2,671 | 53 | 2.0% |
Latin America | 11,033 | 9,275 | 1,758 | 19.0% |
- of which Argentina | 1,166 | 1,033 | 133 | 12.9% |
- of which Brazil | 6,946 | 5,629 | 1,317 | 23.4% |
- of which Chile | 1,467 | 1,348 | 119 | 8.8% |
- of which Colombia | 641 | 533 | 108 | 20.3% |
- of which Peru | 813 | 732 | 81 | 11.1% |
Europe and Euro-Mediterranean Affairs | 386 | 385 | 1 | 0.3% |
Other | 60 | 43 | 17 | 39.5% |
Eliminations and adjustments | (61) | (78) | 17 | 21.8% |
Total | 21,789 | 19,968 | 1,821 | 9.1% |
Gross operating margin
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 3,906 | 3,679 | 227 | 6.2% |
Iberia | 2,025 | 1,965 | 60 | 3.1% |
Latin America | 2,259 | 1,763 | 496 | 28.1% |
- of which Argentina | 271 | 173 | 98 | 56.6% |
- of which Brazil | 1,144 | 815 | 329 | 40.4% |
- of which Chile | 222 | 228 | (6) | -2.6% |
- of which Colombia | 399 | 364 | 35 | 9.6% |
- of which Peru | 223 | 183 | 40 | 21.9% |
Europe and Euro-Mediterranean Affairs | 107 | 152 | (45) | -29.6% |
Other | (19) | (20) | 1 | 5.0% |
Total | 8,278 | 7,539 | 739 | 9.8% |
The gross operating margin increased as a result of:
- an increase of €496 million in the margin in Latin America despite the effects of adverse exchange rate developments of €133 million, an increase that is mainly attributable to:
- in Brazil, the consolidation of Enel Distribuição São Paulo (€313 million);
- in Argentina, the Edesur agreement with the government resolving mutual pending issues arising during the period from 2006 to 2016 in the amount of €209 million. This increase was partially offset by a reduction in sales revenue following a decrease in quantities transported;
- in increase in the gross operating margin in Italy following a reduction in costs for the purchase of energy efficiency certificates due to both a decrease in purchase prices and in volumes purchased (€191 million) and a reduction in personnel costs due essentially to actuarial gains in application of Article 4 of Law 92/2012 (€31 million). It should also be noted that, in 2019, e-distribuzione recognized an additional indemnity of €50 million related to the sale of Enel Rete Gas to F2i, following the indemnity of €128 million recognized in 2018;
- an increase in the margin in Iberia due mainly to an increase in electricity-transport revenue (€56 million) and a gain on the sale of the right to use the fiber-optic network (€24 million). These effects were partially offset by a decrease in revenue from services provided to third-party end users;
- a decrease in the gross operating margin of Europe and Euro-Mediterranean Affairs due to an increase in costs in Romania, mainly for personnel (€12 million), services (€12 million) and electricity purchases (€16 million).
Operating income
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 2,647 | 2,508 | 139 | 5.5% |
Iberia | 1,288 | 1,220 | 68 | 5.6% |
Latin America | 1,349 | 1,025 | 324 | 31.6% |
- of which Argentina | 240 | 98 | 142 | - |
- of which Brazil | 487 | 362 | 125 | 34.5% |
- of which Chile | 173 | 178 | (5) | -2.8% |
- of which Colombia | 292 | 261 | 31 | 11.9% |
- of which Peru | 157 | 126 | 31 | 24.6% |
Europe and Euro-Mediterranean Affairs | 13 | 54 | (41) | -75.9% |
Other | (20) | (20) | - | - |
Total | 5,277 | 4,787 | 490 | 10.2% |
The increase in operating income in 2019 was due to the increase in gross operating margin, which was only partially offset by an increase of €249 million in depreciation, amortization and impairment losses. More specifically, the increase in depreciation, amortization and impairment mainly concerned:
- an increase of €172 million in depreciation, amortization and impairment in Latin America, which was essentially due to the change in the scope of consolidation with the addition of Enel Distribuição São Paulo and the recognition in Brazil of the writedown of the Funac fund in the amount of €96 million, which became necessary after the repeal by the state of Goiás of the obligation to meet the liabilities, even if not recognized, resulting from the administrative and judicial dispute of Enel Distribuição Goiás;
- an increase of €88 million in depreciation, amortization and impairment in Italy due to an increase in capital expenditure and to the application of IFRS 16 (€38 million).
Capital expenditure
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 1,753 | 1,685 | 68 | 4.0% |
Iberia | 647 | 668 | (21) | -3.1% |
Latin America | 1,335 | 1,315 | 20 | 1.5% |
Europe and Euro-Mediterranean Affairs | 169 | 159 | 10 | 6.3% |
Other | 1 | 3 | (2) | -66.7% |
Total | 3,905 | 3,830 | 75 | 2.0% |
The increase in capital expenditure is mainly attributable to:
- Italy and capital expenditure for low-voltage plants; > Iberia and the reduction in capital expenditure for the distribution network and for software applications, an effect which was partially offset by an increase in capital expenditure for substations, transformers, and the replacement of metering equipment;
- Latin America, and Argentina specifically, in order to improve the quality of service provided to users through works aimed at strengthening the low-, medium- and high-voltage networks.
Operations
Electricity sales
Millions of kWh | ||||
2019 | 2018 | Change | ||
Free market | 152,588 | 152,619 | (31) | - |
Regulated market | 149,088 | 142,813 | 6,275 | 4.4% |
Total | 301,676 | 295,432 | 6,244 | 2.1% |
- of which Italy | 97,539 | 104,318 | (6,779) | -6.5% |
- of which Iberia | 89,441 | 89,639 | (198) | -0.2% |
- of which Latin America | 104,962 | 91,075 | 13,887 | 15.2% |
- of which Europe and Euro-Mediterranean Affairs | 9,734 | 10,400 | (666) | -6.4% |
This positive performance of electricity sales in 2019 essentially reflects the increase in quantities sold in Latin America, mainly in Brazil following the acquisition of Enel Distribuição São Paulo. This change was only partially offset by the reduction of electricity sold in Italy due to a decrease in sales on the regulated market following the transfer of 1.8 million customers to the free market. This factor is seen as the cause for the reduction in quantities sold in Romania as well. In Spain, the change was essentially due to reduced consumption. The Group’s retail customers totaled 69,914,992, of which 22,780,590 on the free market. At December 31, 2018, those figures were 71,117,743 and 21,478,721 respectively.
Natural gas sales
Millions of m3 | ||||
2019 | 2018 | Change | ||
Business to consumer | 3,698 | 3,704 | (6) | -0.2% |
Business to business | 6,802 | 7,474 | (672) | -9.0% |
Total | 10,500 | 11,178 | (678) | -6.1% |
- of which Italy | 4,736 | 4,761 | (25) | -0.5% |
- of which Iberia | 5,750 | 6,409 | (659) | -10.3% |
- of which Europe and Euro-Mediterranean Affairs | 14 | 8 | 6 | 75.0% |
The reduction in natural gas sales was mainly due to the aforementioned reductions in consumption in Spain.
Performance
Millions of euro | ||||
2019 | 2018 | Change | ||
Revenue | 32,544 | 33,771 | (1,227) | -3.6% |
Gross operating margin | 3,287 | 3,079 | 208 | 6.8% |
Operating income | 2,163 | 1,958 | 205 | 10.5% |
Capital expenditure | 449 | 374 | 75 | 20.1% |
The following tables shows a breakdown of performance by country in 2019.
Revenue
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 16,042 | 16,367 | (325) | -2.0% |
Iberia | 13,867 | 14,920 | (1,053) | -7.1% |
Latin America | 1,504 | 1,443 | 61 | 4.2% |
- of which Argentina | 30 | 6 | 24 | - |
- of which Brazil | 398 | 299 | 99 | 33.1% |
- of which Chile | 268 | 255 | 13 | 5.1% |
- of which Colombia | 769 | 848 | (79) | -9.3% |
- of which Peru | 39 | 35 | 4 | 11.4% |
Europe and Euro-Mediterranean Affairs | 1,131 | 1,040 | 91 | 8.8% |
Eliminations and adjustments | - | 1 | (1) | - |
Total | 32,544 | 33,771 | (1,227) | -3.6% |
Gross operating margin
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 2,314 | 2,233 | 81 | 3.6% |
Iberia | 715 | 676 | 39 | 5.8% |
Latin America | 243 | 158 | 85 | 53.8% |
- of which Argentina | 2 | (16) | 18 | - |
- of which Brazil | 149 | 100 | 49 | 49.0% |
- of which Chile | 17 | 19 | (2) | -10.5% |
- of which Colombia | 60 | 42 | 18 | 42.9% |
- of which Peru | 15 | 13 | 2 | 15.4% |
Europe and Euro-Mediterranean Affairs | 15 | 12 | 3 | 25.0% |
Total | 3,287 | 3,079 | 208 | 6.8% |
The increase in the gross operating margin is mainly attributable to:
- an increase in margins in Latin America due to:
- the consolidation of Enel Distribuição São Paulo beginning in June of last year (€51 million);
- an increase in revenue in Argentina following the Edesur settlement agreement with the government resolving mutual pending issues arising during the period 2006-2016 (€24 million);
- an increase of €108 million in the margin on the free market in Italy, which was only partially offset by a reduction of €27 million on the regulated market; > a decrease in the cost ratio in Iberia.
Operating income
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 1,609 | 1,379 | 230 | 16.7% |
Iberia | 491 | 494 | (3) | -0.6% |
Latin America | 77 | 87 | (10) | -11.5% |
- of which Argentina | (35) | (16) | (19) | - |
- of which Brazil | 44 | 52 | (8) | -15.4% |
- of which Chile | 6 | 16 | (10) | -62.5% |
- of which Colombia | 52 | 29 | 23 | 79.3% |
- of which Peru | 10 | 6 | 4 | 66.7% |
Europe and Euro-Mediterranean Affairs | (14) | (2) | (12) | - |
Eliminations and adjustments | - | - | - | - |
Total | 2,163 | 1,958 | 205 | 10.5% |
In 2019, operating income, including €1,124 million in depreciation, amortization and impairment, increased due, above all, to performance improvements in Italy, mainly for Enel Energia following the improvement in margins noted above and the decrease of €149 million in depreciation, amortization and impairment, which was essentially related to the decrease in allowances for doubtful accounts.
This positive performance was impacted by the loss recognized in other countries. In Romania, the loss of €14 million reflected an increase in the impairment of trade receivables compared with 2018.
Capital expenditure
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 324 | 248 | 76 | 30.6% |
Iberia | 110 | 107 | 3 | 2.8% |
Latin America | - | 1 | (1) | - |
Europe and Euro-Mediterranean Affairs | 15 | 18 | (3) | -16.7% |
Total | 449 | 374 | 75 | 20.1% |
The change in capital expenditure is mainly attributable to the increase in Italy, particularly with regard to Enel Energia. This increase was due to the capitalization of costs related to the acquisition of new customer contracts.
Enel X
Operations
2019 | 2018 | Change | |||
Demand response (MW) | 6,297 | 6,215 | 82 | 1.3% | |
Lighting points (no.) | 2,424 | 2,467 | (43) | -1.7% | |
Storage (MW)(1) | 12 | 3 | 9 | - | |
Charging points (no.) | 79,565 | 48,967 | 30,598 | 62.5% |
(1) Storage for the year pertaining to Enel X.
In 2019, the Group further developed the charging infrastructure for electric vehicles, particularly in Italy.
Performance
Millions of euro | ||||
2019 | 2018 | Change | ||
Revenue | 1,130 | 1,006 | 124 | 12.3% |
Gross operating margin | 158 | 124 | 34 | 27.4% |
Operating income | (98) | 19 | (117) | - |
Capital expenditure | 270 | 183 | 87 | 47.5% |
The following tables shows a breakdown of performance by country in 2019.
Revenue
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 282 | 247 | 35 | 14.2% |
Iberia | 261 | 247 | 14 | 5.7% |
Latin America | 186 | 161 | 25 | 15.5% |
- of which Argentina | 4 | - | 4 | - |
- of which Brazil | 17 | 15 | 2 | 13.3% |
- of which Chile | 81 | 70 | 11 | 15.7% |
- of which Colombia | 77 | 70 | 7 | 10.0% |
- of which Peru | 7 | 6 | 1 | 16.7% |
North America | 328 | 338 | (10) | -3.0% |
Europe and Euro-Mediterranean Affairs | 35 | 7 | 28 | - |
Africa, Asia and Oceania | 52 | - | 52 | - |
Other | 66 | 50 | 16 | 32.0% |
Eliminations and adjustments | (80) | (44) | (36) | -81.8% |
Total | 1,130 | 1,006 | 124 | 12.3% |
Gross operating margin
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 13 | 31 | (18) | -58.1% |
Iberia | 38 | 51 | (13) | -25.5% |
Latin America | 64 | 56 | 8 | 14.3% |
- of which Brazil | (1) | - | (1) | - |
- of which Chile | 26 | 19 | 7 | 36.8% |
- of which Colombia | 38 | 37 | 1 | 2.7% |
- of which Peru | 1 | - | 1 | - |
North America | 80 | 3 | 77 | - |
Europe and Euro-Mediterranean Affairs | - | 3 | (3) | - |
Africa, Asia and Oceania | (1) | (4) | 3 | 75.0% |
Other | (36) | (16) | (20) | - |
Total | 158 | 124 | 34 | 27.4% |
The increase in gross operating margin came mainly in North America as a result of an adjustment to the amount paid for the purchase of eMotorWerks (€98 million) in application of certain clauses of the related contract. These effects were only partially offset by an increase in operating expenses connected with structural growth in Italy, Spain and Latin America.
Operating income
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | (45) | (9) | (36) | - |
Iberia | (13) | 37 | (50) | - |
Latin America | 58 | 54 | 4 | 7.4% |
- of which Brazil | (4) | (1) | (3) | - |
- of which Chile | 24 | 19 | 5 | 26.3% |
- of which Colombia | 37 | 36 | 1 | 2.8% |
- of which Peru | 1 | - | 1 | - |
North America | (50) | (31) | (19) | -61.3% |
Europe and Euro-Mediterranean Affairs | (3) | 2 | (5) | - |
Africa, Asia and Oceania | (5) | (8) | 3 | 37.5% |
Other | (40) | (26) | (14) | -53.8% |
Total | (98) | 19 | (117) | - |
In 2019, operating income decreased despite the improvement in the gross operating margin, essentially as a result of an increase of €151 million in depreciation, amortization and impairment losses. This mainly concerned the impairment of intangible assets (€83 million) in respect of obsolete technologies that are no longer in use.
Capital expenditure
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 52 | 54 | (2) | -3.7% |
Iberia | 64 | 39 | 25 | 64.1% |
Latin America | 40 | 29 | 11 | 37.9% |
North America | 61 | 38 | 23 | 60.5% |
Europe and Euro-Mediterranean Affairs | 4 | 3 | 1 | 33.3% |
Africa, Asia and Oceania | 1 | - | 1 | - |
Other | 48 | 20 | 28 | - |
Total | 270 | 183 | 87 | 47.5% |
Capital expenditure increased in Spain, the United States and Italy due to the purchase of new software licenses to support new business initiatives (demand response, charging systems, e-mobility, public lighting).
Services and Other
Performance
Millions of euro | ||||
2019 | 2018 | Change | ||
Revenue and other income (net of eliminations) | 2,229 | 2,140 | 89 | 4.2% |
Gross operating margin | (18) | (116) | 98 | 84.5% |
Operating income | (246) | (251) | 5 | 2.0% |
Capital expenditure | 179 | 142 | 37 | 26.1% |
The tables below show performance by geographic area in 2019.
Revenue
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 1,359 | 1,389 | (30) | -2.2% |
Iberia | 597 | 514 | 83 | 16.1% |
Latin America | 27 | 35 | (8) | -22.9% |
Europe and Euro-Mediterranean Affairs | 28 | 22 | 6 | 27.3% |
Other | 291 | 231 | 60 | 26.0% |
Eliminations and adjustments | (73) | (51) | (22) | -43.1% |
Total | 2,229 | 2,140 | 89 | 4.2% |
Gross operating margin
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 169 | 119 | 50 | 42.0% |
Iberia | 66 | 80 | (14) | -17.5% |
Latin America | (123) | (104) | (19) | -18.3% |
Europe and Euro-Mediterranean Affairs | 5 | 1 | 4 | - |
Other | (135) | (212) | 77 | 36.3% |
Total | (18) | (116) | 98 | -84.5% |
The increase in gross operating margin for 2019 is due to:
- an increase of €50 million in the margin in Italy, the result mainly of a reduction in costs for leases and rents due to application of IFRS 16 and their consequent inclusion in the value of right-of-use assets;
- an increase in the margin on the “Other” segment related to the increase in services provided by the holding company to the other Business Lines of the Group and to a decrease in costs for reversal of the provision related to the closing of an Enel SpA arbitration in Romania (€13 million).
Operating income
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 17 | 39 | (22) | -56.4% |
Iberia | 19 | 39 | (20) | -51.3% |
Latin America | (122) | (105) | (17) | -16.2% |
Europe and Euro-Mediterranean Affairs | 3 | - | 3 | - |
Other | (163) | (224) | 61 | 27.2% |
Total | (246) | (251) | 5 | -2.0% |
The operating loss in 2019 improved by €5 million, after an increase in depreciation, amortization and impairment losses of €93 million, which mainly reflected the depreciation of right-of-use assets following application of the new IFRS 16.
Capital expenditure
Millions of euro | ||||
2019 | 2018 | Change | ||
Italy | 78 | 68 | 10 | 14.7% |
Iberia | 46 | 28 | 18 | 64.3% |
Latin America | 9 | 9 | - | - |
Europe and Euro-Mediterranean Affairs | 1 | 1 | - | - |
Other | 45 | 36 | 9 | 25.0% |
Total | 179 | 142 | 37 | 26.1% |
The increase in capital expenditure in 2019 can be attributed to increases in Italy and Spain.