Elia Group SA/NV (ELI) Earnings Call Transcript & Summary

Okay. That was for Belgium. Let's now turn to Germany. What were the drivers behind 50Hertz performance over the last year, Catherine?

Yes. The -- first, I will remind the net profit, which came in at EUR 113 million. It's an increase of 14% compared to last year, and there were several key drivers behind this result. Firstly, the ongoing investment program led to increased asset remuneration, which was up by EUR 35 million. At the same time, depreciation cost increased by EUR 11 million, both were impacted by the partial commissioning of Ostwind 2 in the late '22 and the group progress on the onshore investment. Secondly, onshore OpEx and other costs decreased by almost EUR 6 million. So despite the growth of the activities, the onshore OpEx cost remains well under control. Finally, the financial results decreased by almost EUR 16 million. Let us now look at 50Hertz financial position. The total equity of 50Hertz decreased by EUR 183 million to EUR [ 1.2 ] billion. This drop was entirely due to the hedge reserves. 50Hertz supplies hedge accounting for the purpose of reducing the risk of fluctuations in the expected amount of credit losses. The fair value of this contract dropped leading to a negative hedge reserve of EUR 74 million due to a strong decrease in energy prices. Let me remind you that cost for credit losses are almost fully passed through to the tariffs and therefore, the fair value of further contract has no relevance for the current and future profitability of the companies and is excluded from our return on equity guidance. In terms of liquidity, the liquidity position remains strong at EUR 4.3 billion. As per half year, the EEG and similar mechanism, cash position amounts to EUR 2.4 billion. Since the beginning of the year, the EEG cash position is decreasing, driven by the lower energy prices. Based on current estimates, we anticipate to end the year with an EEG position of around EUR 1.2 billion. As I mentioned earlier, in view of the upcoming investments, and aligned with our ambitions regarding sustainable financing, the liquidity of Eurogrid was further strengthened by securing a EUR 600 million green bond. The funds for this first green loan are provided by seven banks and refinanced under KfW's climate protection programme for company. As of June, EUR 120 million was drawn while the other overdraft and revolving facility remain unused. Following the insurance of EUR 650 million bond in April, the average cost of debt increased to 1.8%. The maturity profile remains balanced with a weighted debt duration of 6.7 years. The rating of Eurogrid remains unchanged at BBB+ with a negative outlook.

In addition to its regulated activities in Belgium and Germany, the Elia Group is also involved in operating Nemo Link and engaging in various nonregulated activities. Catherine, can you provide some insights on how those -- this third segment has contributed to the results?

Yes. Our third segment had a positive contribution of EUR 4 million on the group's net result. However, this contribution was lower compared to previous periods due to first Nemo Link hedging in the gap. And secondly, increased expenses incurred in expanding our international offshore activities to engage. If we look at the details of the year-over-year changes, we see the following. Firstly, the group's results received a EUR 13.3 million contribution from Nemo Link. It's EUR 9.6 million less than last year. This decline can be entirely attributed to Nemo Link hedging in the cumulative gap for the 5-year assessment while the prior year's result partially benefited from lower performance during the years '19 to '21. Additionally, the operational availability of the interconnector remained remarkably high at 98% towards the first half of the year. Apart from Nemo Link, our nonregulated activities results were influenced by increased cost due to the expansion of our offshore activities to engage. However, the holding cost will lower, thanks to higher interest income from cash deposits.

And finally, we have to cover the outlook for this year. And that's your last slide of the day, Catherine.

Yes. And I can say that we're confident in our ability to achieve our goal for this year. And so aiming for an adjusted return on equity ranging from 6% to 7%. Like in the past, this guidance is included the costs linked to our hybrid securities. Now when we look at the different segments for Belgium, we continue to upload our objective of achieving a return on equity within the range of 5% to 6%. In terms of CapEx, we plan to invest around EUR 700 million for the full year. In Germany, we remain committed to a goal of achieving a return on equity between 8% to 10%. However, we have revised our investment upwards from EUR 1.5 billion to EUR 1.7 billion. This increase is primarily driven by the need to secure future capacities in the supplier market. Regarding the nonregulated segment, Nemo Link, we reconfirm our outlook as well, which anticipates a loss of up to EUR 5 million. Considering the availability of the interconnector and revenues exceeding the cumulative gap, we expect that Nemo Link will contribute around EUR 25 million. I want to add that this guidance does not consider any potential M&A transactions as usual. And on another note, Marleen, I'm delighted to extend an invitation to our second Capital Market Day, taking place on the eighth of December. This event will be conducted virtually, providing, I think, an excellent opportunity to update you on all our strategic growth pillars and share insights on the latest regulatory developments. We look forward to your participation. And now I will hand it back to you, Marleen and Chris to conclude today's presentation, which I suppose some closing remarks.

Indeed. Catherine and Chris, I would like to share with you some final thoughts. What will be the focus points for Elia Group after the summer break?

Well. It's obvious -- of course, the most important focus point for the next 6 months will be on fair return. In the last 18 months, the financial markets have completely changed, and this current environment is characterized by increasing interest rates that needs a prompt consideration of adjustment of the fair return both in Belgium and Germany. If Elia would fail to raise sufficient capital, we as society may face a deficiency in essential infrastructure. Such a scenario would impact the speed of the progress of the energy transition and probably even more importantly, it would reduce the resilience of our industry and also have a negative impact on our welfare. Second point of focus is the capacity of our supply chain that is under pressure due to the extensive investments by European TSOs and other industries. We see today already that delivery times are increasing and there is limited room for negotiations. Suppliers selectively choose tender projects and customers to derisk their offers. Elia Group is taking measures to mitigate these circumstances, including building long-term strategic partnerships, reserving production capacity and implementing simplified tender processes. This is all to avoid that the execution of investment plans could be delayed. And finally, something that you know that I'm personally looking forward to what is the publication of our annual foresight study this year, it is on putting flexibility to work. This time, we're approaching this study in a very different way since we're -- have been collaborating with students from different universities in Belgium and Germany. We recently organized a student challenge, both in Brussels and Berlin, the students were asked to identify the current barriers for flexible consumption and to set up a start-up company that comes with ideas to put flexibility at work. On top of the student challenges, several use cases are being developed that will also be included in our paper that will be published third week of November.

Okay. We're clearly enthusiastic about this challenge. While we prepare the Q&A session, we have a few interviews with some of the students involved to share with you. [Presentation]

And Elia Group study on flexibility, putting flexibility to work. That will be the title will be presented on Tuesday, the 21st of November in the late afternoon during a live streamed event and you're most welcome to attend this live in the studio. For now, we have shared a lot of information with you today. I suggest we now move on to the Q&A session. Yannick Dekoninck, our Investor Relations Manager will guide us through this. Yannick, could you share the first question with us, please.

Thank you, Marleen. I propose to start Q&A, and I think maybe Juan Rodriguez from Kepler can kick off.

I have a couple of questions from my side. The first one is on the regulatory review that you're currently engaged. As you signaled today at 5.85% -- 5.87% proposal. In Germany, I want to double check with you, if this will imply both things equal that means that your incentives are maintained and the cost efficiencies as well. We'll put the total return on equity on the German side within the 8.5% to 10.5% range. If it is correct, and will this be in your view, a fair remuneration for your German activities? And similarly for Belgium, it is currently at 5.7%. What will be, in your view, a fair remuneration for these activities under the current discussion. The first one. The second one is I want to double check with you because you just signaled that the RAB target for the end of the year has been maintained EUR 12.3 billion, but you slightly revised upwards your CapEx for the year. So can you please provide more color on the moving parts on this adjustment? And the third one that I have is on end of the year guidance, you already posted a 3.58% adjusted return on equity at the first half results. And all things equal will put the group towards the upper range of the 6% to 7% guidance if we translate into the full year results. Should we expect some additional adjustments or a weaker performance in H2 in that sense?

So I will take, I think, all your question. So on the first question, Juan, regarding the adjustment of the regulatory return in Germany. The figures that you came with are too optimistic. Like I mentioned during the presentation until now what we have announced as a guidance for the period 2024 to 2028 in Germany was between 7% to 9%. So indeed, before that, we knew possible modifications in the regulatory return in Germany. Those modifications have still to be confirmed, but what we have on the table today is an increase of the fair return for new assets. So the assets that will be qualified as new as from 2024 -- the new assets as from 2024 for the onshore activities and those assets, which are qualified under the capital cost adjustment model. So like I mentioned in the presentation, it's a very small part of the total asset of the company. And today, if we apply the increased return on the portion of those assets, it would lead to an increase of 20 basis points, not more than the 20 basis points. There maybe more to come in terms of offshore. There might be more to come or not after the consultation. That's something that we will have to follow up. But based on the information we have today and assuming that all other elements would remain equal, it would lead to a 20 basis point increase in the guidance that we have announced. So nothing to change basically, the range between 7% to 9%. That's one. Secondly, in terms of RAB that's something on which we need to come back. So indeed, there was a slight increase of the CapEx in Germany. And we will come back to you with the half figures. You have a point there. And then on the last question that you mentioned, whether we expect to end in the upper range of the guidance. Not -- we don't expect that, so no. The reality is that some of the elements contributing positively to the results are front loaded. Small example, interest rates in the third segment at the holding level. You have seen in the first half a positive impact of interest on cash. This cash we need to pay back the hybrid securities in September, the EUR 700 million hybrid security that we have in September. And so we have a nice contribution coming from interest in the first half, but we will not see any more the same type of contribution in the second half of the year. Second example in Germany, you saw probably that the OpEx are well under control in the first half of the year. If you look historically at the transmission in Germany, you will see that usually in the second half of the year, there are higher OpEx than in the first half of the year, and that's also something that we expect in 2023 for Germany. So in total, no, we don't expect based on the information we have today to end in the upper range of the guidance because of the fact that some results and positive results are front-loaded in our 2023 first half year results.

I now propose to give the floor to Piotr Dzieciolowski from Citi. So Piotr, do you have any additional questions that are not yet covered by Juan.

I just wanted to question the 20 basis points uplift you expect in the Germany following the review. How much of the assets by the end of the regulatory period will be based on the new regulatory framework versus the old regulatory framework because I understand the uplift is roughly 200 basis points and you're going to spend more over this period than your entire RAB at the moment or similar to. So based on my calculation, the uplifts could be more in the range of, I don't know, 100 basis points other than 20. So can you please elaborate on this impact of this increased returns? And second question, I would have -- just I would stick to 2 questions. What is your expectations towards the remuneration in the Belgium? I know you are very relieved at the discussion process part, I would be keen to understand how much of an uplift you expect there.

Okay. So in terms of impact, maybe it's helpful to remind you that there are 4 categories of investment in Germany. There are the investments falling into the base year regime, there are -- the onshore, there are the investment falling into the investments measure regime, also onshore. You have the CCE onshore and finally you have the offshore investment. The consultation that has been published by the German regulator only addressed the category of the onshore CCE investment and more specifically, the new onshore CCE investment. And that's probably the reason why you might have had higher computation after the first element of publication because you were considering the entirety of the new investment and not necessarily and specifically the ones linked to the CCE. Second element, you are right to say that the figures that we're giving, so the 20 basis points is an average over the 5 years period. We will have years after years, more new investments, more investment qualification being new. And it means that what we can expect is in the beginning of the period, a lower contribution, but at the end of the period, a higher contribution. So there will be indeed a timing impact based on the publication of the increased return like done today by Germany. Lastly, for Belgium, it's very difficult to see anything relevant at this moment. Like Chris mentioned, we are engaged into talks and discussions with the Belgian regulator, but it's premature to mention anything. We don't know yet if something will be allocated or will be given by the CAC. And if something is -- would be given, what would be the exact mechanism. That's something we are currently discussing. We expect to have more visibility during Q3 and more specifically at the end of Q3. And of course, we will continue to keep you updated as soon as we can say something on possible outcome on those discussions.

I propose now to move on to KBC, where we have Wim Lewi. So Wim, please go ahead.

I have a follow-on on this German regulator question, and thanks for explaining that split. Now I was a bit surprised to see that the offshore consultation will be completed or will start only in October. So my question is on this is really, first, why do we think that's been separated? And do you think that can be finished these consultations and this new calculation before the year-end and also because your -- in your Capital Markets Day at the beginning of December. So what's your view on this? Why is it separated? Or do you expect this to be a similar formula as is done with the onshore and then just still in different variables or maybe just exactly the same format. What are your thoughts on that?

So in terms of timing, the consultation is indeed announced in October by BNetzA. I know that the 4 TSOs in Germany are trying to have some information published by BNetzA a little bit earlier. We expect indeed that this consultation will be finished by the end of the year. So we expect indeed that for the tariff settings of 2024, all the new elements onshore/offshore will be included in terms of what could it be as a mechanism or even as, let's say, percentage of possible increase. Sorry, but once again, it's too early to say. We really need to wait until the moment that regulators come with something official to be in a position to make any comments on those ones. So I will ask you a little bit more patience until October at least for offshore.

Okay. If I may, then a follow-up on WindGrid. And there you also mentioned that there were additional costs about EUR 2.8 million. Can you give a little bit of qualification what these costs are about? Is it investing in new people? Is it start-up costs? And really, what's the nature of those costs? Are they one-off or more recurrent kinds? And then lastly on that, when do you think you can kind of give more on the revenue side from the pipeline when we can expect some news on that front?

Yes. So in WindGrid is a combination of 2 things. On the one hand is, of course, that we are in the phase of the buildup of the team. To give an example, we recruited 2 people specifically focused in the U.S., on the U.S. market. As you know, WindGrid is focusing in a first instance, both on European markets outside of the Belgian and the German regulated space and also at the U.S. side, and we thought it was a good moment as well to reinforce the team in the U.S. to make sure that we can participate to a number of upcoming tenders that we have in the Northeast side of the U.S., which is the focus point that we have today. And as you know, we have already made 2 partnerships, one with PPL and one with NextEra in the U.S. And as well, we are looking at a couple of specific opportunities today in -- mainly in the Irish Sea and in the Baltic Sea that we're looking for. The other ones are, let's say, early stage direct cost that we have in a number of projects that we are assessing. It's early stage, which at the moment that we try to assess if we can have a valid origination of those projects that's mainly focused on the project that we have seen in the Irish Sea and in the Baltic Sea. And secondly, we are -- we have responded to a consultation around a -- preconsultation round in the state of New England, where we expect that there will be then the real consultation on a transmission-only tender later this year, and we expect the same. We have not yet spent a lot of time on that, but we expect the same also for the state of New York somewhere in the early part of next year that they will also have a consultation on a transmission-only tender. That's more or less where you see that the costs are going today. And so if you look at what is the expectation, if we look at the pipeline that is currently there and the maturity of that pipeline compared to FID and the real moment of investments, you should further look at the end of the decade before we start to have really, let's say, commissioned assets that could be part of that. So we think that investment will be starting, let's say, likely not in the coming 2 to 3 years. And then we will have a, let's say, a development phase and then you will have a phase that we can then either sell those assets, either monetize them for a while. So that is a little bit what you see in that pipeline. It looks like, let's say, a very positive and healthy pipeline. We remain very, let's say, optimistic about what WindGrid is doing, and we see as well that we have a lot of traction both in the U.S. and in Europe in the specific places that I mentioned because there's a lot of need of capabilities and Elia has developed those capabilities over the years. But there's a little bit, of course, like development time is there as it should be there. So we derisked those projects in the substantial steps in the stage process as we've always done that. And so that leads then to the time lines that we just proposed to you.

Then I propose to move on to Mafalda Pombeiro. She's representing Goldman Sachs.

I have two questions on my end because I believe most of them were already answered. The first one is still on the Belgium review, potential review. I know you probably can't comment or it's a bit too early to comment on what you could get from that potential negotiation, but if you could comment very high level, what would be your potential demand? Or what do you think could be improved versus the status quo, that would be great. The second one would be on the investments for this year. So as far as I understood, we invested so far a bit more than EUR 800 million, and there is a target of EUR 2.4 billion for the whole year. So I think there will be a heavy CapEx second half. So is this normal seasonal -- related to the seasonality of the projects, or is this driven by the constraints Chris were mentioning during the presentation, namely in terms of the supply chain? And any comment that you could provide in terms of the net debt evolution, excluding EEG towards the end of the year would be great as well.

So maybe on the first one, so about return on equity in Belgium. Look, what we see in Belgium is that we can expect higher investments in the next years, the next 5 years, which are absolutely necessary to maintain the high level of security that we have on the grid, the high reliability on the one hand; and second, for delivering on the energy transition. So it's not only that the interest rates have been set at the moment where the environment was different than what we have today. It's also that the magnitude of funding that you will need, both debt and equity in the future will be higher than what we have seen in the past. So that's the context in which we are. And those are the elements we are currently discussing with the regulator. To give any indication on the possible outcome is -- I'm sorry to say, once again, is really premature. That's something that we can't do at this stage. We really need to wait until the moment that CAC would come with any kind of signal and information towards the market. On the second element in terms of investment, if you would look at historical trends, you will see year after year the same kind of trends, namely that investments are more back loaded than front loaded. I commented earlier on our results, OpEx and interest impact on the net result. For the CapEx, the trend goes in the opposite direction. So usually, we have much less in the beginning of the year, and then we have more at the end of the year. It's linked to a number of factors, operational factors, winter conditions in the beginning of the period, especially in Germany. But it's also linked, you are right, to a number of capacity slots that we want to reserve at suppliers and so a number of prepayments that we will do and more at the end of the year than at the beginning of the year. So we are really confident in our ability to deliver on the total guidance for the CapEx. And the trends that you are currently seeing is something that you will see in the past as well.

Then I'm also very happy to have Exane in the call, Harry Wyburd.

So thanks very much for taking a question from a new face. I appreciate we've had a lot of good questions already. So I'll just keep two relatively short ones. So on -- I'm sorry to come back to regulation again. So on Germany, you mentioned in the prepared remarks that you thought it was important that you got higher remuneration on the existing asset base as well as new investments. So I just wanted to check whether you see any chance of getting an update or a change to the remuneration on the existing asset base in this regulatory cycle. So by the end of this year, or was that something that would have to wait until the next regulatory cycle in Germany? And then second one is sort of bigger picture, I guess. Looking internationally, some of the opportunities you mentioned just now on WindGrid, I guess, we're looking quite focused here on Germany and Belgium and there's a massive CapEx opportunity and if you extrapolate that globally, it's even bigger. So I wondered, do you have in mind an amount of capital that you'd be willing to allocate to international activities over time? Or maybe sort of what you see as the addressable market. Just give us a sense as to how material that could be towards the end of the decade for you internationally? And then how would you look at returns in international investments when you were deploying your own capital? Would you look for something that's just better than what you're getting domestically in Germany or Belgium, would you look for kind of IRR, WACC spread, something like the offshore wind developers target? I'm just interested in how you think about returns and value creation there.

Chris, would you like to take on regulation? Because I answered maybe a number of times, I'm happy to continue to do but do you think...

Yes. I mean you take maybe regulation, I will then comment on the, let's say, the WindGrid side, if you're okay with that?

Okay. So on regulation, so our view is, of course, that in order to fund properly the assets that we have, the return level needs to address both existing and new assets. But at the end, we will look at the return, let's say, in total, apply to the hub. So we believe it would be logical to have an increase on the existing assets and the new assets and not only on the new asset. And that's indeed one of the points we are putting on the table in our discussion with the regulator, whether we will be successful in this discussion is something that we will know later and by the end of the year.

Well, and then I will comment on the WindGrid situation. So what we see is the market is really speeding up. So we see that both in Europe, in other parts of the Baltic Sea. We see that in the Irish Sea. We see that also in the North Sea. Unfortunately, in the North Sea -- well, unfortunately, in the North Sea, we see that there are a little bit less opportunities because we have already a very capable existing other TSOs that are operating in the offshore space. So there's little space left then for somebody that is to say, not coming from the regulated side directly. And so that's the same case for WindGrid. So we're more focused on that side. In the U.S. side, we see as well that after, of course, the hit that we saw in that market by the inflation that everybody was a little bit taken by surprise and we saw that wind farms are paying the price for that. We see now a correction and that we see that IRRs and projects are again going into the direction of double-digit plus kind of returns. So above what we see and that's, of course, also the intention of WindGrid that we can benefit from places where we have a return which is higher than the current average return that we have as a group. Otherwise, it would not make a lot of sense to go for that expansion. Now the other thing, how much can we expose to that in terms of CapEx. I think that's a real question that we are working on today because we had made some, let's say, soft statements about that before, but that was, of course, before that we saw the huge increase in the organic side of the business. And I think that we have now to take into consideration what is the kind of capacity that we can have on our balance sheet to finance those different CapEx streams. We have, of course, made a commitment in the regulated space, and we will fulfill that commitment if they give us the fair return that we need for that. So that's a commitment that we made. And then we can see what the headroom is that we have for further investments outside of that space. And so that is with those, let's say, acceleration that we see. Of course, the opportunity becomes bigger at the outside, but also the stretch on our balance sheet by the existing business has become greater. And so that's something that we will have to rebalance and probably we will have some more comments on that later in the year when we have the Capital Markets Day.

That's very clear. And just maybe a very small follow-up. You mentioned the double-digit IRRs. Is that an equity IRR or an asset IRR?

That's an asset IRR. But if we look at the equity IRR that we would have, there are still, let's say, substantially higher than what we see in Europe today.

I see that Piotr still has a follow-up question, I believe. So I would say, Piotr, please go ahead.

Yes, I have 2 or 3 follow-up questions. Thank you for the opportunity to ask them. So firstly, I wanted to ask you about your capital position. How much, based on your calculation, you need equity to finance your current investment program? And how much can you wait until you have to do another rights issue essentially, is it based on your calculation, is it going to come in '24, '25, '26? Or can you please elaborate on this financing front. The other question I had was, can you please say if you see any influence or really across from the TenneT negotiation with the German government into your position on 50 heads, would an idea of disposing the asset come to you? Or how would you assess this situation in your context? And finally, I mean we talk a lot about the offshore cost inflation. Can you say roughly how much of a cost inflation for the offshore asset connections you've seen over the last 2, 3 years?

I will take the first, maybe on the capital. And so the capital increase that might be expected or not. So first element, you will remember that we said at the beginning of the year, and we can confirm that we don't see any need of additional equity for funding the investment program we have in Belgium, we have in Germany in 2023. So that's something that we clearly not have on the agenda. Second, in terms of equity raise that might be necessary in, let's say, the longer term, based on the current investment plans that we have in Germany and that we have in Belgium, it's not that we see an urgent need to do an equity raise in the next 12 months. Of course, we can be opportunistic at certain moment of the time depending on market conditions and evolution of the market. But in terms of, let's say, funding needs, and you know that we fund based on gearing ratios, the regulated gearing ratio for Belgium and 25% equity, 75% debt at German level. Based on, let's say, evolution of those ratios and current investment plans that we have, we still -- with the capital increase that we did last year, we still have some buffer. So it will mostly depend on market circumstances then on the one hand. Second, of course, outcome of the regulatory discussions. And depending on possible revision that will be done, it will impact or not the cash flow that we have at level of Belgium and at level of Germany, and so it could also have an impact on the possible timing and success of the operation. And so that's the reason why in terms of amount and in terms of timing, we are not more precise for the time being. And that's for first something on which we will comment in December during the Capital Markets Day giving much more precise indications about the financial means that will be requested over not only then 2024, but also the longer period and the longer regulatory frameworks.

Then maybe on the second question, as we have mentioned in previous calls, this is, of course, a situation that we monitor closely because any move in ownership could have an impact on the 50Hertz situation. And so we have, of course, the benefit that through our partnership with KFW, we have a quite open dialogue with the government on potential consequences. And what we see today is that they are relatively happy with the way how 50Hertz is run and the way how they can have transparency on the operations as well on the role that Elia Group plays into making sure that the energy vendor gets delivered. So in that perspective, we feel quite comfortable that we are in a position that at least when something would happen, there will be a dialogue in which we can participate. And there seems to be no urgency or at least less urgency from the government to look at a fast consolidation of the TSOs. They are now focused on making the deal happen. And that, of course, has been quite influenced by the fact that the Dutch government has changed into a government of current affairs, meaning actually that all negotiations as far as we know, has been stopped, waiting for the list of topics on which the current government in currents affairs can work on and that need to be voted by the Dutch Parliament somewhere in the second week of September. And so we wait is -- the TenneT deal is on the list, yes. No, it will have an impact on the way, of course, how that negotiation will go. We are not in the driver seat of that negotiation, and it's very clear that the negotiation topic is a 100% carve-out of TenneT Germany and taken over in a first step by KFW. There are some discussions today about what could be a second step of replacement of that capital, but they're very immature at this point of time. But as said, like it's not something that we would worry too much about today because we think that we're in a relatively okay position. Maybe last thing to add in our press conference in Germany, I stated the official position of the group towards this deal. And so it's very clear that Elia is committed to its relevance in the German market. And so that means that we will defend our position or look at potential opportunities that a shift in ownership will bring, and then we will evaluate that at due time and come back to the information that will follow out of that, but it's too early now, given the fact that any negotiation around the TenneT deal has been stopped and is waiting for this parliamentary discussion in early September.

I think that we had a very interactive Q&A.

Still sorry to interrupt you. I realize that I forgot to answer one question that was raised on expected evolution of the net debt, sorry for that. But looking at all the questions that were raised, that's one I skipped. And so to give a quick answer on this one. And if I remember well, the question was relating to a net debt position, excluding EEG, which makes it much easier to answer because you know that on EEG, we might have indeed some kind of fluctuations. And the answer is that we don't expect, let's say, material changes on the net debt by the end of the year compared to what we have today. We will have, let's say, some cash movement, but not something to materially impact the position of the net debt. compared to where we are at June.

Thank you, Catherine, for this additional clarification on the question asked by Mafalda. Then I think we can now close the Q&A and I wish you all a very nice afternoon.

Thank you, Yannick. Indeed, if there are no further questions, I suggest that we bring this presentation to a close. Thank you, Yannick, Chris, Catherine, for your contribution. Thank you also to Stéphanie Luyten working behind the scenes and the whole technical theme. A recording of today's presentation, the slides and the script will be made available online later today. Thank you for joining us, and enjoy the summer.