Terna — Interim / Quarterly Report 2021

Nov 10, 2021

RESULTS AS OF 30 SEPTEMBER 2021 APPROVED

ACCELERATION IN CAPEX CONTINUES IN THIRD QUARTER, BENEFITTING THE ENERGY TRANSITION AND THE COUNTRY

IMPROVEMENT ACROSS ALL FINANCIAL INDICATORS

• Revenues €1,901.6 million (compared to €1,780.6 million in 9M 2020, +6.8%)
• EBITDA €1,373.9 million (compared to €1,323.3 million in 9M 2020, +3.8%)
• Group net profit for the period €580.4 million (compared to €569.1 million in 9M 2020, +2.0%)
• Capex €925.3 million (compared to €749.5 million in 9M 2020, +23.5%)
• Net debt €9,573.2 million (compared to €9,172.6 million on 31 December 2020)
• Interim dividend for 2021 of €9.82 euro cents per share, up 8% on interim dividend for 2020

Rome, 10 November 2021 – Today's meeting of the Board of Directors of Terna S.p.A. ("Terna"), chaired by Valentina Bosetti, has examined and approved the results for the nine months ended 30 September 2021.

The first nine months of the year saw a continuous recovery in electricity consumption in Italy, which rose 6.2% during the period compared to the previous year. Against this backdrop, Terna recorded an improvement in its results, continuing with the major acceleration in investment in order to deliver the energy transition: in particular, Terna's total capital expenditure in the first nine months amounted to €925.3 million, a 23.5% increase compared to the same period of 2020, which had already registered 11.9% growth compared to 2019, the year before the Covid-19 pandemic.

"Since May of last year, we have decided to significantly step-up Terna's activity, in recognition of our key role in leading the energy transition and driving the Country's economic recovery," said Stefano Donnarumma, Terna's CEO and General Manager. "For the sixth consecutive quarter, we have, therefore, accelerated capex, as we focus more than ever on delivering the projects included

in our Industrial Plan. This work, which has a key part to play in enabling our Country to reach its decarbonisation goals, is proceeding according to schedule."

€m	9M 2021	9M 2020	% change
Revenues	1,901.6	1,780.6	+6.8%
EBITDA (gross operating profit)	1,373.9	1,323.3	+3.8%
EBIT (operating profit)	882.5	865.1	+2.0%
Group net profit for the period	580.4	569.1	+2.0%
Capital expenditure	925.3	749.5	+23.5%

CONSOLIDATED FINANCIAL HIGHLIGHTS FOR 9M 2021

Revenues for the first nine months of 2021, amounting to €1,901.6 million, show a growth of €121.0 million (6.8%) compared to the same period of 2020. The result primarily reflects an increase in revenues from Regulated Activities, combined with the contribution from Non-regulated Activities, reflecting increased contributions from the Tamini Group and the Brugg Group, as well as from the Energy Solutions segment of activities. Revenue for the third quarter of 2021 is up €45.4 million compared to the same period of the previous year (up 7.6%).

EBITDA (gross operating profit) for the period amounts to €1,373.9 million, with an increase of €50.6 million (3.8%) compared to the €1,323.3 million of the first nine months of 2020. This primarily reflects an improvement in EBITDA from Regulated Activities. The EBITDA for the third quarter of 2021 shows a rise of 3.6% to €463.4 million (€447.3 million in the same period of 2020).

EBIT (operating profit) for the period, after amortisation, depreciation and impairments losses equal to €491.4 million, amounts to €882.5 million, versus the €865.1 million of the first nine months of 2020 (up 2.0%).

Net financial expenses for the period amount to €68.4 million, broadly in line with the €70.4 million of the first nine months of 2020.

Profit before tax amounts to €814.1 million, with an increase of €19.4 million compared to the same period of 2020 (up 2.4%).

Income tax expense for the period totals €231.8 million, with a growth of €8.9 million compared to the same period of 2020. This essentially reflects the increase in pre-tax profit and a reduction in tax-exempt income recognised during the period. The tax rate of 28.5% compares with a rate of 28% for the first nine months of 2020.

Group net profit for the period is equal to €580.4 million with an increase of €11.3 million (2.0%) on the €569.1 million of the first nine months of 2020.

The consolidated statement of financial position shows equity attributable to owners of the Parent of €4,639.4 million, versus €4,369.8 million recorded on 31 December 2020.

Net debt is equal to €9,573.2 million compared to €9,172.6 million at the end of 2020, with the increase of €400.6 million reflecting growth in capital expenditure during the period.

The Terna Group's total capital expenditure during the period amounts to €925.3 million, with an increase of 23.5% compared to €749.5 million of the same period of 2020. The main projects carried out during the period include the progress of work on the 380kV Paternò-Pantano-Priolo power line in Sicily; the reorganisation of the electricity grid serving the Turin metropolitan area and the progress of work on the interconnection with France. There was also major investment in synchronous compensators in southern Italy, which are key elements in ensuring stability of the grid.

The Group had 4,996 employees at the end of September 2021, with a growth of 261 employees compared to 31 December 2020. The increase is linked to the planned strengthening of the Group's competencies and growth of the business, in keeping with the 2021-2025 "Driving Energy" Industrial Plan.

KEY EVENTS IN Q3 2021 AND AFTER THE END OF THE REPORTING PERIOD

Business

On 12 July 2021, the new 150kV "Melilli – Priolo" power line entered service. The new connection, which is approximately 6 km long and is completely underground, has replaced the old overhead line in the municipalities of Priolo Gargallo and Melilli, in the province of Syracuse. The new connection, in which Terna invested approximately €10 million, uses innovative devices designed to improve management and monitoring of the infrastructure. The new line forms part of the "Paternò-

Pantano-Priolo" project, a 380kV power line currently under construction that will extend for 63 km and connect the Paternò (Catania) and Priolo Gargallo substations.

On 13 July 2021, the new 380/150kV electricty substation at Belcastro, in the province of Catanzaro, entered service, together with approximately 2 km of new overhead lines forming part of the 380kV "Magisano-Scandale" backbone. Terna invested a total of approximately €90 million in the project. In addition to permitting the integration of renewable sources, the new substation is also needed to increase meshing on the 150kV grid. This is to be followed by construction of the new 150kV "Calusia-Mesoraca-Belcastro-Catanzaro" line, currently awaiting authorisation, which will be approximately 50 km in length. The completed reorganisation will result in the dismantling of approximately 45 km of existing line and the demolition of around 175 pylons.

On 13 July 2021, the new 132kV "Modena North – Modena East" and "Modena East – Modena Crocetta" power lines, located entitely in the Municipality of Modena, entered service. The project, in which Terna invested over €5 million, consists of a new 5-km long underground cable and a new overhead line extending for approximately 1 km. The project will increase meshing and improve the reliability of the electricity system serving the city of Modena.

On 16 July 2021, the Ministry for the Ecological Transition gave the go-ahead for Terna's plan to reorganise the grid between Malcontenta and Fusina in the Venice area. The intervention will help boosting the efficiency and resilience of the electricity transmission service in the Veneto region. The project, in which Terna will invest €190 million, involves the reorganisation of the 132kV, 220kV and 380kV power lines between Venice and Mira. It will also include construction of a new 380kV connection from the Fusina power station to the Fusina 2 electricity substation, the laying of 24 km of underground cable and the resulting removal of over 21 km of overhead lines and 89 pylons, expansion of the Fusina 2 electricity substation, and reconstruction of the Malcontenta electricity substation. In total, the work will vacate over 53 hectares of land.

On 21 July 2021, the Ministry for the Ecological Transition authorised the reorganisation of the grid known as the "132kV Rimini – Riccione Ring", which will involve a total of 8 municipalities (Rimini, Riccione, Coriano, Santarcangelo di Romagna, San Mauro Pascoli, Savignano sul Rubicone, Gatteo and Gambettola) in the provinces of Rimini and Forlì-Cesena. The project, in which Terna will invest €50 million, is aimed at making the electricity system in the area more secure and efficient, especially during the summer season when electricity consumption rises significantly, with the resulting risk of

outages. The project will also enable the demolition of a total of 41 km of old overhead lines and the retirement of 171 pylons in the eight affected towns, removing grid infrastructure from over 130 hectares of land.

On 22 July 2021, the Ministry for the Ecological Transition began the process of issuing consents for the new 132kV "Donada – Rosolino – Brondolo" power line. The project, in which Terna will invest €20 million, involves the construction of a new 132kV underground cable of 24 km in length between the Venice and Rovigo areas and the resulting demolition of 17 km of overhead lines and 89 pylons dating back to the 1950s. The project will improve the quality of the service provided by the grid in the area south of the Venetian Lagoon, given the growing demand for power from the Primary Cabin in Brondolo, connected to the MOSE project, in particular for the floodgates installed at the entrance to the port of Chioggia.

On 5 August 2021, the Ministry for the Ecological Transition authorised the 132kV power line connecting the Marostica and Bassano primary substations, in the province of Vicenza. The new underground cable, in which Terna is to invest approximately €12 million, will have a total length of 8 km and will pass through the municipalities of Marostica and Bassano del Grappa, helping to boost the resilience of the area's electricity grid.

On 31 August 2021, Terna announced the start of the Public Consultation on the Adriatic Link project. Digital meetings, held in compliance with anti-contagion legislation, were used to present the plans to people in the in the towns in Abruzzo and Marche involved in the project, in order to answer questions and listen to the observations and views of citizens and stakeholders. Between 6 and 9 September, Terna met members of the public from the towns of Montesilvano, Città Sant'Angelo, Cappelle sul Tavo, Spoltore and Cepagatti, in the province of Pescara and the town of Silvi in the province of Teramo whilst, on 13 and 14 September, the meetings involved people in Fano and Cartoceto, in the provinces of Pesaro and Urbino. Specifically, Terna had the opportunity to present all the interested parties with the proposed plans for construction of the converter stations and the technical specifications of the new submarine connection that will link the Abruzzo and Marche regions.

On 9 September 2021, the Ministry for the Ecological Transition gave the go-ahead for the planned modernisation of the existing 380kV "Bolano-Paradiso" power line, dating back to the 1980s and located in the provinces of Messina and Reggio Calabria. Approval was also given for construction

of the new Contrada Annunziata electricity substation, again in the province of Messina. The project, in which Terna will invest approximately €38 million, regards the Sicilian section of the power line. It will involve the removal of approximately 2.7 km of overhead lines currently sited very close to residential areas - and involving the consequent demolition of four pylons - and the laying of 3.4 km of new underground cable, which will run along the existing road network between the place where the submarine cable will make landfall in Sicily and the switching station.

On 24 September 2021, Terna announced the start of the second stage of the Public Consultation on the West Link section of the Tyrrhenian Link, which is to link Sicily and Sardinia with a submarine cable for which Terna is investing approximately €3.7 billion. Terna organised a series of digital "Terna Incontra" events to present the technical aspects of the project and the options for location of the new electricity substation. The meetings held on 29 September involved people in the town of Termini Imerese (province of Palermo) whilst, between 4 and 6 October, Terna met members of the public from the Sardinian towns of Quartu Sant'Elena, Sinnai, Quartucciu, Maracalagonis, Selargius and Settimo San Pietro, in the province of Cagliari.

On 22 October 2021, consent was received for the construction of two new 150kV underground cable power lines called "Carini2-Carini RT" (6.3 km long) and "Carini2-Carini" (7.3 km long), both in the town of Carini, in the province of Palermo. The new lines, in which Terna will invest €22.4 million, will help to meet the need for electricity supply in the surrounding area, improving quality of service and upgrading the local grid in step with growth in demand for electricity.

On 27 October 2021, Terna began the consents process for the new 150kV underground cable power line between the Ragusa electricity substation and the Ragusa North primary substation. The project, in which Terna will invest €18.5 million, will involve construction of a new underground line extending for over 14 km between the Ragusa electricity substation and the Ragusa North primary substation. The project will meet the need for the development of electricity infrastructure in the area, upgrading the local grid in keeping with growing demand from businesses and local people and improving the efficiency and sustainability of the electricity transmission service.

Finance

On 13 July 2021, Terna obtained a new loan of €300 million from the European Investment Bank. The loan will be used to fund the 2021-2025 "Driving Energy" Industrial Plan, which envisages total investment of €8.9 billion for the energy transition.

On 16 July 2021, Terna launched its first three-year Euro Commercial Paper (ECP) programme worth up to €1,000,000,000.

On 29 October 2021, S&P Global Ratings (S&P) reiterated Terna's long-term rating of 'BBB+' and upgraded the outlook from stable to positive.

Sustainability

On 21 September 2021, Terna was included in the Stoxx Global ESG Leaders sustainability index for the eleventh consecutive year, marking international recognition for the excellent performance across all areas of assessment, above all with regard to environmental, social and governance (ESG) matters. The Stoxx Global ESG Leaders index, which this year includes 410 companies globally, including 18 Italian businesses, has assessed a total of approximately 1,800 companies.

On 18 October 2021, Terna was included in the MIB 40 ESG, the first blue-chip index for Italy to be based on best ESG practices.

Non-regulated Activities

In October 2021, Terna Energy Solutions, a Terna Group company, signed an agreement for acquiring the 75% of LT Holding. This has resulted in the creation of the biggest Italian provider of O&M (operation and maintenance) services for photovoltaic plants, with approximately a thousand megawatts under management. LT is one of the leading Italian providers of photovoltaic maintenance services and also designs and delivers revamping and repowering projects for existing plants and builds new plants for third-party customers.

In August 2021, Terna, acting through its subsidiary Terna Energy Solutions S.r.l., completed the acquisition of the remaining 30% of Tamini Trasformatori S.r.l., which as a result is now a sole shareholder company fully owned by Terna.

OUTLOOK

In the final quarter of the year, with the pandemic expected to improve compared to the earlier part of 2021, the Group will continue to focus on implementing the 2021-2025 Industrial Plan, which is aimed at confirming and strengthening Terna's central role in driving the Italian energy system and enabling the ecological transition. Out of the €9.2 billion to be invested under the Industrial Plan timeframe, approximately €1.4 billion is to be invested in the current year.

In line with the new 2021 National Transmission Grid Development Plan presented in July, which targets investment of €18.1 billion over the next ten years (up 25% on the previous plan), expenditure on Regulated Activities will be stepped up. Investment will focus on enabling the energy transition and facilitating the development and integration of renewable sources, making a major contribution to achieve the ambitious goals set out in the Green Deal and helping to drive the country's economic recovery. The principal electricity infrastructure under construction includes the interconnection with France and the planned strengthening of the link between Sardinia, Corsica and the Italian mainland (SA.CO.I.3). As regards the progress of work on the Tyrrhenian Link, the process of obtaining the necessary authorisations for the East Link section began in the second half of the year, as did the public consultation on the West Link section. The process of procuring the cables is also expected to be completed in the last quarter. Work is also progressing on the main projects that will increase exchange capacity between the various areas of the Italian electricity market, including the Bisaccia-Deliceto and Paternò-Pantano-Priolo power lines.

In terms of the Security Plan, the planned installation of synchronous compensators will continue, with the aim of supporting the regulation of short-circuit voltage and power in areas of the Country characterised by a high level of production from renewable sources and a significant reduction in traditional production.

Work on the reorganisation of electricity grids in metropolitan areas will also continue in the latter part of 2021, primarily involving the renewal of existing infrastructure with new technologically advanced connections meeting the highest standards in terms of environmental sustainability (e.g., Naples, Rome and Turin).

Finally, the regulator is in the process of establishing the methods and criteria for determining and revising the allowed WACC for the electricity and gas sectors from 2022. As part of this procedure,

in July, ARERA published an initial consultation document, setting out its initial methodological approach to revising the way the regulator calculates a number of parameters that make up the formula. ARERA expects to publish a second consultation document in the last quarter and adopt a final determination by the end of the year.

Regarding the Non-regulated Activities, Terna will continue to consolidate its role as a provider of both connectivity, pursuing opportunities based on exploiting the Group's own fibre infrastructure, and energy solutions, developing high value-added services for corporate customers and exploiting market opportunities for traditional and renewable customers, even through the acquisition of the LT Group.

In terms of manufacturing, the aim is to build on Tamini's performance, exploiting the strategic opportunities deriving from the acquisition of total control of the Group, and complete the integration of Brugg, enabling to take full advantage of the group's distinctive expertise in underground cables and of synergies with the Terna Group's other businesses. The new corporate structure put in place in the first half of the year is also expected to be beneficial in this regard.

International activities will continue to focus on proceeding with work on the construction of the two Linha Verde I and Linha Verde II power lines in Brazil. The strategic assessment of further opportunities in overseas markets will continue. This may take the form of partnerships and will involve the careful selection of projects with a view to ensuring a low risk profile and avoiding the need to tie up large amounts of capital.

In line with previous months, the Group will continue to step up investment in innovation and digital solutions as part of the transformation that will enable to manage the growing complexity of the electricity system.

Significant attention will also be paid to people development and the insourcing of strategic competencies, to the strengthening of departments, and to optimising the working environment for the employees through delivery of the NexTerna project, which has already achieved the first important milestones in the seven areas into which the project is divided.

Management of Terna's business will continue to be based on a sustainable approach and respect for the ESGs, ensuring that the company is able to minimise its environmental impact, involve local stakeholders and meet the need for integrity, responsibility and transparency.

The above objectives will be pursued whilst maintaining the commitment to maximising the cash generation necessary to ensure a sound, balanced financial structure.

INTERIM DIVIDEND FOR 2021 OF 9.82 EURO CENTS PER SHARE

In consideration of the operating and financial performance and the guidance and outlook for the rest of the current year, Terna S.p.A.'s Board of Directors has decided, in line with the policy set out in the 2021-2025 Industrial Plan, to pay an ordinary interim dividend for 2021 of 9.82 euro cents per share, with an increase of 8% compared to the previous year. In this regard, the independent auditors Deloitte & Touche S.p.A. today released the opinion required by art. 2433-bis of the Italian Civil Code.

As required by art.2357-ter, paragraph 2 of the Italian Civil Code, the treasury shares purchased to service the 2020-2023 and 2021-2025 Share Performance Plans may not participate in the distribution of the interim dividend.

The total distribution of €197,381,214.40 euro has been calculated on the basis of the 2,009,992,000 ordinary shares representing the Company's share capital. Treasury shares held at the record date shown below will not participate in the distribution. The interim dividend for 2021 payable on the treasury shares held by the Company at the record date, amounting to €303,947.85, will thus be taken to the "Retained earnings" reserve.

The interim dividend, before any withholdings required by law, will be payable from 24 November 2021 (the record date, as defined by art. 83-terdecies of Legislative Decree 58/1998, the "CLF", is 23 November 2021), with an ex-dividend date for coupon 35 of 22 November 2021.

ALTERNATIVE PERFORMANCE MEASURES

This release includes a number of "alternative performance measures" (EBITDA, the tax rate and net debt) not required by IAS/IFRS accounting principles. A description of these measures is provided below in accordance with the ESMA/2015/1415 guidelines published on 3 December 2015: - EBITDA (Gross Operating Profit): an indicator of operating performance, representing "Profit for the period" before "Income tax expense for the period", "Net financial income/(expenses)" and "Amortisation, depreciation and impairment losses";

• Tax rate: the amount of tax paid as a proportion of pre-tax profit, based on the ratio of "Income tax expense" to "Profit/(Loss) before tax";

• Net debt: an indicator of the financial structure, calculated by deducting "Cash and cash equivalents", "Current financial assets" and "Non-current financial assets", as they relate to the value of the derivatives hedging bond issues, from short-term financial liabilities ("Short-term borrowings", the "Current portion of long-term borrowings" and "Current financial liabilities") and long-term financial liabilities ("Long-term borrowings") and the related derivative instruments ("Non-current financial liabilities"). The net debt of the Terna Group complies with the requirements of ESMA Recommendation nr. 32-382-1138 of 2021 with regard to the definition of net debt, which does not include "Non-current financial assets".

Comparative amounts for the first nine months of 2020 are the same as those published in the Consolidated Interim Financial Report for the nine months ended 30 September 2020, without taking into account the impact of completion of the process of accounting for the business combination involving the Brugg Group which was completed on 31 December 2020. Further details are provided in the Consolidated Interim Financial Report for the nine months ended 30 September 2021.

With respect to the structure of the Terna Group at 31 December 2020, the following should be noted:

On 26 January 2021, Terna, acting through its subsidiary, Terna Energy Solutions S.r.l., completed the acquisition of the remaining 30% of Avvenia the Energy Innovator S.r.l. from the minority shareholder, Avvenia S.r.l.. Avvenia the Energy Innovator S.r.l. has thus become a sole shareholder company wholly owned by Terna.

On 1 February 2021, after APG (the Austrian TSO) became the fifth European transmission system operator to enter into partnership with Equigy, Terna S.p.A.'s interest in Equigy decreased from 25% to 20%.

The reorganisation of the Brugg group, designed to take full advantage of the group's distinctive expertise in underground cables and of synergies with the Terna Group's businesses, was completed on 31 March 2021. As a result, Terna S.p.A.'s interest in the Brugg group has increased from 90% to 92.6%.

On 10 June 2021, Terna, acting through its subsidiaries, Terna Plus S.r.l. and Terna Chile S.p.A., completed the acquisition of the remaining 25% stake in the Brazilian-registered company, SPE Transmissora de Energia Linha Verde II S.A., held by the minority shareholder, Construtora Quebec. SPE Transmissora de Energia Linha Verde II S.A. is now 99.9999994% owned by Terna Plus S.r.l., with the remaining shares held by Terna Chile S.p.A..

Terna completed the acquisition of a 100% stake in EL.IT.E. S.p.A. on 27 July 2021. The acquired company was simultaneously renamed Elite S.r.l., a vehicle company that owns and manages (under a service agreement entered into with Repower) the approximately 4-km long 150kV merchant line connecting Italy and Switzerland between Tirano and Campocologno. The company also currently owns the Tirano electricity substation, in addition to the 150kV cable connection between the TIRANO ST electricity substation and the Italian border with the related tunnel section.

On 3 August 2021, Terna, acting through its subsidiary, Terna Energy Solutions S.r.l., completed the sale of 100% stakes in Rete Verde 17 S.r.l., Rete Verde 18 S.r.l., Rete Verde 19 S.r.l. and Rete Verde 20 S.r.l. to Banca del Fucino, the purchaser chosen following a competitive auction.

On 5 August 2021, Terna, acting through its subsidiary, Terna Energy Solutions S.r.l., completed the acquisition of the remaining 30% of Tamini Trasformatori S.r.l., which as a result is now a sole shareholder company fully owned by Terna.

On 15 September 2021, Terna, pursuant to Law 99/2009, completed the sale of its 100% stake in Resia Interconnector S.r.l. to Interconnector Energy Italia S.c.p.A., Consorzio Toscana Energia S.p.A. and VDP Fonderia S.p.A., entering into agreements for the construction and operation of the private part, located in Italian territory, of the alternating current power line between Italy and Austria.

A meeting will be held at 4.00pm today to present the results for the nine months ended 30 September 2021 to financial analysts and investors. Back-up material for the event will be made available in the Investors section of the Company's website (www.terna.it) as the meeting starts. The presentation will also be made available via "eMarket SDIR", on the website of Borsa Italiana S.p.A. (www.borsaitaliana.it) and through the authorised storage service (). Journalists will have the opportunity to follow the meeting by telephone without any right to speak. It will also be possible to follow the presentation by connecting to the audio webcast on the Company website (www.terna.it): following the live broadcast, the file will be available in the Investors section of the website.

The Manager Responsible for Financial Reporting, Agostino Scornajenchi, declares that, pursuant to section two of article 154-bis of the Consolidated Law on Finance, the information contained in this release is consistent with the underlying accounting records.

The Terna Group's Consolidated Interim Financial Report for the nine months ended 30 September 2021 has not been audited and was prepared voluntarily, pursuant to art. 82-ter of CONSOB Issuer Regulations (as amended by CONSOB Resolution 19770 of 26 October 2016). As in the past, the compliance and correctness of the financial information provided to the public and the comparability of the related information with the corresponding data in previously published interim reports is ensured. The document containing the Terna Group's Consolidated Interim Financial Report for the nine months ended 30 September 2021 will be made available to the public by 13 November 2021 at the Company's registered office, published on the Company's website, (www.terna.it) and on the website of the authorised storage service (), and filed at the stock exchange management company Borsa Italiana S.p.A. (www.borsaitaliana.it). The required announcement of the filing will also be published.

The Terna Group's reclassified consolidated income statement and statement of financial position and statement of cash flows, prepared on the basis of the classifications used by management in order to more effectively assess the Terna Group's operating and financial performance, are attached. Pursuant to Communication DME/9081707 of 16 September 2009, the above reclassified financial statements are those included in the Terna Group's Consolidated Interim Financial Report for the nine months ended 30 September 2021, prepared in accordance with usual market practices.

The Terna Group's reclassified income statement

		Q3						(€m)
2021	2020*	Cha nge	% change		9M 2021	9M 2020*	Change	% change
642.9	597.5	45.4	7.6%	TOTAL REVENUE	1,901.6	1,780.6	121.0	6.8%
550.1	519.8	30.3	5.8%	- Regulated revenue of which Revenue from construction	1,643.5	1,545.0	98.5	6.4%
11.9	5.5	6.4	116.4%	services performed under concession	27.1	13.8	13.3	96.4%
83.5	72.1	11.4	15.8%	- Non-Regulated revenue	246.1	217.7	28.4	13.0%
9.3	5.6	3.7	66.1%	- International revenue	12.0	17.9	(5.9)	(33.0%)
179.5	150.2	29.3	19.5%	TOTAL OPERATING COSTS	527.7	457.3	70.4	15.4%
70.8	63.3	7.5	11.8%	- Personnel expenses	215.9	206.7	9.2	4.5%
41.3	38.6	2.7	7.0%	- Cost of services. leases and rentals	126.5	114.7	11.8	10.3%
49.0	35.2	13.8	39.2%	- Materials	135.1	100.5	34.6	34.4%
5.1	4.4	0.7	15.9%	- Other costs	18.4	18.9	(0.5)	(2.6%)
1.4	3.2	(1.8)	(56.3%)	- Quality of service	4.7	2.7	2.0	74.1%
11.9	5.5	6.4	116.4%	- Cost of construction services performed under concession	27.1	13.8	13.3	96.4%
				GROSS OPERATING PROFIT
463.4	447.3	16.1	3.6%	(EBITDA)	1,373.9	1,323.3	50.6	3.8%
165.7	155.9	9.8	6.3%	- Amortisation, depreciation and impairment losses	491.4	458.2	33.2	7.2%
297.7	291.4	6.3	2.2%	OPERATING PROFIT (EBIT)	882.5	865.1	17.4	2.0%
(27.3)	(31.3)	4.0	(12.8%)	- Net financial income/(expenses)	(68.4)	(70.4)	2.0	(2.8%)
270.4	260.1	10.3	4.0%	PROFIT/(LOSS) BEFORE TAX	814.1	794.7	19.4	2.4%
74.1	67.9	6.2	9.1%	- Income tax expense for the period	231.8	222.9	8.9	4.0%
196.3	192.2	4.1	2.1%	PROFIT FOR THE PERIOD	582.3	571.8	10.5	1.8%
0.5	0.6	(0.1)	(16.7%)	- Profit/(Loss) attributable to non controlling interests	1.9	2.7	(0.8)	(29.6%)
195.8	191.6	4.2	2.2%	PROFIT FOR THE PERIOD ATTRIBUTABLE TO OWNERS OF THE PARENT	580.4	569.1	11.3	2.0%

*Amounts are the same as those published in the consolidated interim financial report for the nine months ended 30 September 2020, excluding the impact of the restatement required by IFRS 3.

The Terna Group's reclassified statement of financial position

			(€m)
	at 30 September 2021	at 31 December 2020	Change
Total net non-current assets	16,075.5	15,645.9	429.6
- Intangible assets and goodwill	600.0	577.9	22.1
- Property, plant and equipment	14,935.5	14,559.7	375.8
- Financial assets	540.0	508.3	31.7
Total net working capital	(1,760.0)	(1,936.2)	176.2
- Net energy-related pass-through payables	(543.0)	(385.0)	(158.0)
- Net receivables resulting from Regulated Activities	450.2	230.9	219.3
- Net trade payables	(467.6)	(818.0)	350.4
- Net tax liabilities	(166.6)	40.5	(207.1)
- Other net liabilities	(1,033.0)	(1,004.6)	(28.4)
Gross invested capital	14,315.5	13,709.7	605.8
Sundry provisions	(78.2)	(121.3)	43.1
NET INVESTED CAPITAL	14,237.3	13,588.4	648.9
Equity attributable to owners of the Parent	4,639.4	4,369.8	269.6
Equity attributable to non-controlling interests	24.7	46.0	(21.3)
Net debt	9,573.2	9,172.6	400.6
TOTAL	14,237.3	13,588.4	648.9

The Terna Group's cash flow

		(€m)
	Cash flow 9M 2021	Cash flow 9M 2020*
- Profit for the period	582.3	571.8
- Amortisation, depreciation and impairment losses	491.4	458.2
- Net change in provisions	(43.1)	(69.6)
- Net losses/(gains) on sale of assets	(10.5)	(3.7)
Operating cash flow	1,020.1	956.7
- Change in net working capital	(175.2)	(374.4)
- Other changes in property, plant and equipment and intangible assets	45.5	7.2
- Change in investments	2.1	2.1
- Change in financial assets	(33.8)	18.5
Cash flow from operating activities	858.7	610.1
- Total capital expenditure	(925.3)	(749.5)
Free cash flow	(66.6)	(139.4)
- Dividends paid to the Parent Company's shareholders - Cash flow hedge reserve after taxation and other movements in equity attributable	(359.0)	(332.3)
to owners of the Parent	48.2	(93.6)
- Other movements in equity attributable to non-controlling interests	(23.2)	(0.7)
Change in net debt	(400.6)	(566.0)

*Amounts are the same as those published in the consolidated interim financial report for the nine months ended 30 September 2020, excluding the impact of the restatement required by IFRS 3.