Corporate Credit Rating 2024 for NWG ENERGIA SPA: A3- (Affirm)

modefinance published the Solicited Corporate Credit Rating of NWG ENERGIA S.P.A. SOCIETA’ BENEFIT on the website and the rating assigned to the entity is A3- (Affirm). The analysis revealed that the Company's has a strong capacity to fulfill its financial obligations.

NWG ENERGIA S.P.A. SOCIETA’ BENEFIT operates in the national free electricity market and has been committed to provide its end customers energy supplies exclusively from renewable sources since its establishment in 2014, showing particular attention to environmental sustainability. In 2016, the Company expanded its corporate purpose to include not only profit-making activities, but also common interest purposes, becoming Italy’s first energy B-Corp in the same year. 

NWG ENERGIA S.P.A. SOCIETÀ BENEFIT demonstrates a satisfactory economic and financial situation. The solvency area shows a good improvement in capitalization, while financial indebtedness is decreasing and remains largely sustainable. The financial balance is adequate, with the current ratio above one. Despite the decrease in turnover and operating margins, mainly due to the reduction in energy prices which led to a contraction in profitability indicators, the Company shows good levels of return on equity and return on investment.

The management of credit lines appears to be sound, with punctual payments for loans and long-term debts, and the utilization of self-liquidating and overdraft facilities is well-managed. The Company’s increasing direct procurement on the electricity market has led to a greater absorption of liquidity, while additional liquid resources have been used to reduce financial and tax debt, as well as to pay resolved dividends. Nonetheless, the Company maintains an adequate amount of readily available liquidity.

Regarding governance, the Company has a board of directors supported by a board of statutory auditors, while the auditing of accounts has been entrusted to a specialized firm. In 2022, the Company adopted the Organizational Model pursuant to Legislative Decree 231/2001 and appointed a Supervisory Board. NWG ENERGIA S.P.A. SOCIETÀ BENEFIT, which holds 20 percent of its own shares and has no holdings in other companies, has a clearly identifiable group structure, with control traceable to the two founding shareholders of NWG ITALIA. The Company’s positioning appears solid in terms of size and sufficient in terms of solvency compared to the reference peer group; profitability is well above the sector median, thanks to the increased ROE recorded in the financial year 2022. The peer group demonstrates an overall sufficient solvency level, while the liquidity and profitability indicators appear adequate.

The energy sector in Italy holds considerable strategic importance and has recently undergone significant changes due to geopolitical tensions. However, in recent months, the situation appears to have stabilized, with some reduction in commodity prices. The macroeconomic outlook for Italy projects a slowdown in growth for 2024, influenced by high interest rates impacting consumption and investment. Over the medium to long term, inflationary pressures are expected to ease, benefiting GDP growth and public debt sustainability. There is potential for upward revisions in macroeconomic forecast data.

The following table lists the factors, actions, or events that could lead to a rating upgrade or downgrade:

^{The present Corporate Credit rating is issued by modefinance under EU Regulation 1060/2009 and following amendments.The present rating is solicited and is based on both private and public information. The rated entity and/or related third parties have provided all private information used. modefinance had access to some accounts and other relevant internal documents of the rated entity and/or related third parties. Solicited and unsolicited ratings issued by modefinance are of comparable quality, as the solicitation status has no effect on methodologies used. More comprehensive information on modefinance Corporate Credit Ratings are available here
The present Corporate Credit Rating is issued on MORE Methodology 2.0 and Rating Methodology 1.0. A comprehensive description of both methodologies, as well as information on modefinance Rating Scale and Mappings, is available here. For information on historical default rates of modefinance Corporate Credit Ratings please refer to ESMA Central Repository  and ESMA European Rating Platform.} 

^{modefinance refers to default as a company under bankruptcy, or under liquidation status, or under administration or for which missed payments on a financial obligation are officially recorded.}

^{The quality of the information available on the rated entity and used to determine the present rating was judged by modefinance as satisfactory. Please note that modefinance does not perform any audit activity and is not in a position to guarantee the accuracy of any information used and/or reported in the present document. As such, modefinance can accept no liability whatsoever for actions taken based on any information that may subsequently prove to be incorrect.}

^{The present credit rating was notified to the rated entity in order to identify potential factual errors, as prescribed by the CRA Regulation. No amendments were applied after the notification process.}

^{The rated entity is a buyer of ancillary services provided by modefinance (preliminary rating). modefinance ensures that such situation does not imply a conflict of interest in the issuance of the present credit rating.}

^{The rating action issued by modefinance was performed independently. The analysts, members of the rating team involved in the process, modefinance Srl and its members and shareholders do not have any conflicts of interest in relation to the Rated Entity and/or Related Third Parties. If in the future a potential conflict of interest is identified in relation to the persons reported above, modefinance Ratings will provide the appropriate information and if necessary the rating will be withdrawn.
The present Credit Rating is an opinion of the general creditworthiness that modefinance issues on the rated entity, and should be relied upon to a limited degree. The issued rating is subject to an ongoing monitoring until withdrawal.}

Head Analyst - Stefano Chirsich, Rating Analyst
stefano.chirsich@modefinance.com

Responsible for Rating Approval - Pinar Dilek, Rating Process Manager
pinar.dilek@modefinance.com