Corporate Credit Rating 2024 for OENERGY S.P.A.: B1 (Affirm)

Press release 9 May 2024

Solicited Corporate Credit Rating 2024 for OENERGY S.P.A.: B1 (Affirm)

modefinance published the Solicited Corporate Credit Rating of OENERGY S.P.A. on the CRA website and the rating assigned to the entity is B1 (Affirm). The analysis revealed that the company has an adequate economic-financial situation with average capability of repaying financial obligations and it is little affected by adverse economic scenarios.

OENERGY S.P.A. has been operating in the energy sector since 2010 and is licensed for retail and wholesale of natural gas andelectricity, serving a wide range of customers, from households to large companies. In the last two years, the Company managed thedifficulties that emerged in the energy sector by repositioning itself on the market, strengthening its sales network and directly contracting institutional operators. As a result, the company achieved very positive economic results, outperforming the management forecasts.

Key Rating Assumptions

The financial and economic situation of the Company has significantly improved compared to 2021. In 2023, the Company experienced a significant increase in sales revenue, which amounted to over EUR 67.8 million (+69% YoY). This result can be attributed to the Company's strategies regarding procurement, sales network enlargement and customer portfolio management. The ratios of the profitability area confirm fully sufficient values, thanks to the growing operating margins and net income (€457,000). The Company has a well-balanced management of liquidity, both in static terms and in the cash flow dynamics. Lastly, on the solvency front, the Company shows a satisfactory level of capitalization. The net financial debt, despite the increase, is still sustainable when compared to EBITDA and total shareholders’ funds.
The Bank of Italy's Central Risks Report shows correct management of credit lines.

The Company has an administrative body and a supervisory body, both in a collegial form, and adopts the organizational model ex-231/2001. The corporate structure is streamlined, with a single shareholder represented by M2R HOLDING S.R.L., fully controlledby the entrepreneur Mr. Mattia Pagani. OENERGY controls OEgreen S.p.A., which specializes in the sale of plants and power generation from renewable sources. In 2023, the management pursued the plan of consolidation of real estate assets in order to provide for the construction of photovoltaic plants. In the next five years, the Company plans to install a fleet of ten plants in Italy, which will further boost business volume. These investments in 2023 were financed also through the recourse of a new bank debt.

Compared to the reference peer group, the Company's positioning is above the 50th percentile in terms of size, while the performance in terms of solvency and profitability is aligned with the group median. The sector peer group expresses satisfactory solvency levels, adequate financial balance and good profitability.

The energy sector in Italy is of considerable strategic importance in Italy and has undergone strong and important changes due to recent geopolitical tensions. In the last months, however, the situation seems to have normalized, with a partial reduction in commodity prices.

The macroeconomic outllook for Italy projects a deceleration in growth for 2024, with consumption and investment affected by the high interest rates. In the medium to long term, however, inflationary pressure is expected to slow down, with benefits for both GDP growth and public debt sustainability. Macroeconomic forecast data could be revised upwards.

Sensitivity Analysis

In the following table, the addressing factors, actions or events that could lead to a rating upgrade or a downgrade are summarized: 

Important

The present Corporate Credit rating is issued by modefinance under EU Regulation N. 1060/2009 and following amendments.

The present rating is solicited, and 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.

Modefinance provided the rated company with ancillary services (ESG Rating). Modefinance ensures that the provision of ancillary services does not present conflicts of interest with its credit rating activities.

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.

Contacts

Head Analyst – Elisa Graffi (Rating Analyst)

elisa.graffi@modefinance.com


Responsible for Rating Approval – Pinar Dilek (Rating Process Manager)

pinar.dilek@modefinance.com