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Annual Report
of Enel Finance International N.V.
at December 31, 2021


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2
Contents
Director’s report 3
Financial statements for the year ended 31 December 2021 22
Statement of comprehensive income 23
Statement of financial position 24
Statement of changes in equity 25
Statement of cash flows 26
Notes to the financial statements 27
Other information 84
Report of the independent auditor 85


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Director’s report
Director’s report


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General information
The Management of the Company hereby presents its financial statements for the financial year ended
on 31 December 2021.
Enel Finance International N.V. (“the Company”) is a public company with limited liability, where
74.99% of the shares are held by Enel Holding Finance S.r.l (direct parent) and 25.01% of the shares
are held by Enel S.p.A., both companies, have their seats in Rome, Italy. 100% of the shares of Enel
Holding Finance S.r.l. are held by Enel S.p.A. Therefore, Enel S.p.A. is the ultimate controlling
shareholder of the Company.
The Company is registered with the trade register of the Dutch chamber of commerce under number
34313428. The Company operates as a financing company for the Enel Group (“Enel”), raising funds
through bond issuances, loans and other facilities and on turn lending the funds so raised to the
companies belonging to the Enel Group.
Significant events in 2021
The sustainability-linked revolving credit facility
On 5 March 2021 the Company jointly with Enel S.p.A. signed the sustainability-linked revolving credit
facility for an amount of Euro 10 billion on a maturity of five years. The Facility is linked to the Key
Performance Indicator (“KPI”) of Direct Green House Gas Emissions (i.e., Group Scope 1 CO2
equivalent emissions from the production of electricity and heat), contributing to the achievement of
the United Nations Sustainable Development Goal (SDG) 13 Climate Action” and in line with the Enel
Group’s “Sustainability-Linked Financing Framework”, with Vigeo Eiris providing a Second-Party
Opinion.
The Facility replaces the previous Euro 10 billion revolving credit line obtained in December 2017.
In 2021 the Company executed several liability management transactions which together with
issuance of new bonds will improve the long-term debt structure in terms of composition, maturity
profile and economic conditions and further accelerate the achievement of the Enel targets of
sustainable finance sources.
A triple-tranche Euro 3.25 billion sustainability-linked bond in the eurobond market
On 8 June 2021 the Company placed a triple-tranche Euro 3.25 billion Sustainability-Linked bond,
linked to the achievement of Enel’s sustainable objective related to the reduction of Direct Greenhouse
Gas Emissions, contributing to the United Nations Sustainable Development Goal 13 and in line with
the Enel Group’s Sustainability-Linked Financing Framework.
The issue is structured in the following three tranches:
- Euro 1 billion at a fixed rate of 0.000%, with settlement date set on 17 June 2021, maturing
17 June 2027:
the issue price was set at 98.909% and the effective yield at maturity is equal to 0.183%;


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the interest rate will remain unchanged to maturity, subject to achievement of a Sustainability
Performance Target (SPT) by the Enel Group equal to or lower than 148gCO2eq/kWh as of 31
December 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-party
expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Enel Group;
- Euro 1.25 billion at a fixed rate of 0.500%, with settlement date set on 17 June 2021, maturing
17 June 2030:
the issue price was set at 99.728% and the effective yield at maturity is equal to 0.531%;
the interest rate will remain unchanged to maturity, subject to achievement of a SPT equal to
or lower than 148gCO2eq/kWh as of 31 December 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-party
expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Enel Group;
- Euro 1 billion euros at a fixed rate of 0.875%, with settlement date set on 17 June 2021,
maturing 17 June 2036:
the issue price was set at 98.061% and the effective yield at maturity is equal to 1.015%;
the interest rate will remain unchanged to maturity, subject to achievement of a SPT equal to
or lower than 82gCO2eq/kWh as of 31 December 2030;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-party
expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Enel Group.
The partial refinancing of four series of conventional bonds
On 15 June 2021 the Company completed the non-binding voluntary tender for the repurchase, and
subsequent cancellation, of part of four outstanding series of conventional bonds in euros listed below:
- Euro 2.5 billion Notes issued on 17 September 2009, due 14 September 2022 and 5.000%
coupon (ISIN XS0452187916);
- Euro 1.0 billion Notes issued on 15 October 2012, due 17 April 2023 and 4.875% coupon (ISIN
XS0842659426);
- Euro 1.5 billion Notes issued on 27 January 2015, due 27 January 2025 and 1.966% coupon
(ISIN XS1176079843);
- Euro 1.3 billion Notes issued on 1 June 2016, due 1 June 2026 and 1.375% coupon (ISIN
XS1425966287).
The Company repurchased in cash part of the aforementioned bonds (amounting in total to Euro 6.3
billion) for an aggregate nominal amount of Euro 1,069 million. The repurchase transaction was settled
on 17 June 2021 at the same time of the settlement of the issuance of the multi-tranche Sustainability-
Linked bond.
Due to the refinancing process, the Company paid a cash consideration in amount of Euro 88 million.


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Multi-tranche USD 4 billion sustainability-linked bond in the U.S. and international markets
The Company placed a multi-tranche USD 4 billion equivalent to about Euro 3.4 billion.
The issue is structured in the following four tranches:
- USD 1.25 billion at a fixed rate of 1.375%, with settlement date set on 12 July 2021, maturing
12 July 2026:
the issue price was set at 99.510% and the effective yield at maturity is equal to 1.477%;
the interest rate will remain unchanged to maturity, subject to achievement of a Sustainability
Performance Target (“SPT”) equal to or lower than 148gCO2eq/kWh as of 31 December 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-party
expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Enel Group;
- USD 1 billion at a fixed rate of 1.875%, with settlement date set on 12 July 2021, maturing
12 July 2028:
the issue price was set at 99.596% and the effective yield at maturity is equal to 1.937%;
the interest rate will remain unchanged to maturity, subject to achievement of a SPT equal to
or lower than 148gCO2eq/kWh as of 31 December 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-party
expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Enel Group;
- USD 1 billion at a fixed rate of 2.250%, with settlement date set on 12 July 2021, maturing 12
July 2031:
the issue price was set at 99.378% and the effective yield at maturity is equal to 2.320%;
the interest rate will remain unchanged to maturity, subject to achievement of a SPT equal to
or lower than 148gCO2eq/kWh as of 31 December 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-party
expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Enel Group;
- USD 0.75 billion at a fixed rate of 2.875%, with settlement date set on 12 July 2021, maturing
12 July 2041:
the issue price was set at 98.769% and the effective yield at maturity is equal to 2.957%;
the interest rate will remain unchanged to maturity, subject to achievement of a SPT equal to
or lower than 82gCO2eq/kWh as of 31 December 2030;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-party
expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Group.
Bond repurchase for an aggregate nominal value of 6 billion US dollars
On 27 July 2021 the Company repurchased in cash four of its conventional bonds, guaranteed by Enel,
for an aggregate nominal value of USD 6 billion, following the exercise of a redemption option provided
for in the offering documents of the relevant bonds.


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Due to the repurchase transactions, the Company paid a cash consideration in amount of USD 417
million.
A triple-tranche Euro 3.5 billion sustainability-linked bond in the eurobond market
On 21 September 2021 launched a multi-tranche “Sustainability-Linked bond” for institutional
investors in the Eurobond market for a total of 3.5 billion euros.
The issue is structured in the following three tranches:
- 1,250 million euros at a fixed rate of 0.000%, with settlement date set on September 28th,
2021, maturing May 28th, 2026:
the issue price has been set at 99.702% and the effective yield at maturity is equal to 0.064%;
the interest rate will remain unchanged to maturity, subject to the achievement of a
Sustainability Performance Target (“SPT”) equal to or lower than 148gCO2eq/kWh as of
December 31st, 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-party
expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Group;
- 1,000 million euros at a fixed rate of 0.375%, with settlement date set on September 28th,
2021, maturing May 28th, 2029:
the issue price has been set at 99.902% and the effective yield at maturity is equal to 0.388%;
the interest rate will remain unchanged to maturity, subject to the achievement of an SPT
equal to or lower than 148gCO2eq/kWh as of December 31st, 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-party
expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Group;
- 1,250 million euros at a fixed rate of 0.875%, with settlement date set on September 28th,
2021, maturing September 28th, 2034:
the issue price has been set at 99.512% and the effective yield at maturity is equal to 0.915%;
the interest rate will remain unchanged to maturity subject to the achievement of an SPT
equal to or lower than 82gCO2eq/kWh at December 31st, 2030;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-party
expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Group.
The partial refinancing of conventional bonds
On October 2022 the Company repurchased and subsequently canceled part of the following series of
outstanding conventional bonds denominated in US dollars:
- 2.00 billion US dollar bonds issued on May 22nd, 2017, maturing on May 25th, 2027 and coupon
3.625% (ISIN 144A: US29278GAA67; ISIN Reg S: USN30707AC23) (“Notes 2027”);
- 1.25 billion US dollar bonds issued on September 11th, 2018, maturing on June 14th, 2029 and
coupon 4.875% (ISIN 144A: US29278GAK40; ISIN Reg S: USN30707AL22) (“Notes 2029”).
The Company accepted and repurchased in cash conventional bonds for a total nominal amount of
1,471.7 million US dollars.


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Due to the partial refinancing, the Company paid a cash consideration in amount of USD 207 million.
Lending Operations
During the reporting year the Company has resolved to enter as lender into several new intercompany
financial agreements to support mainly the growth of the investments in the renewable energy sector.
Please see a disclosure of long-term and short-term loans and facility agreements granted to the Enel
Group Companies in the notes 6 and 9 of the financial statements.
Equity contribution
In October the Company received an additional capital contribution in amount of Euro 8,100 million
from the parent companies.


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Overview of the Company’s performance and financial position
Analysis of the Company financial position
Millions of euro
at Dec. 31,
2021
at Dec. 31,
2020
Change
Net non-current assets:
-other non-current financial assets
709
182
527
-other non-current financial liabilities
(523)
(1,590)
1,067
Total net non-current assets/ (liabilities)
186
(1,408)
1,594
Net current assets/ (liabilities):
-net tax payable
4
(46)
50
-other current financial assets
216
244
(28)
-other current financial liabilities
(348)
(398)
50
-other current liabilities
(2)
(2)
0
Total net current assets/ (liabilities)
(130)
(202)
72
Gross capital employed
56
(1,610)
1,666
Provisions:
-deferred tax assets/ (liabilities)
357
-
357
Total provisions
357
-
357
Net Capital Employed
413
(1,610)
2,023
Total Shareholders' Equity
10,064
2,116
7,948
Net financial debt
(9,651)
(3,726)
(5,925)
The net non-current assets at 31 December 2021 increased by Euro 1,594 million compared to 31
December 2020 essentially due to the negative change of fair value of derivatives.
Net current liabilities totaled Euro 130 million with a decrease of Euro 72 million compared to
31 December 2020 mainly due to a decrease of interests accrued for bonds and deposits (Euro 71
million), a decrease of tax payable (Euro 50 million), an increase of interest receivables (Euro 31
million).
This decrease was partly offset by the negative change of fair value of derivatives (Euro 72 million),
and decrease of other current assets (Euro 8 million).
Deferred taxes increased by Euro 357 million reflecting temporary differences attributed to hedging
transactions accrued directly in other comprehensive income and temporary differences attributed to
cost capitalization of bond repurchasing, interest carry forwards and impairment of financial assets
accrued in profit and loss.
Net capital employed stood at 413 million at 31 December 2021, up Euro 2,023 million compared to
the same period of 2020. The variation is due to the decrease of the Net Financial Debt (Euro 5,925
million) and increase of shareholders’ equity (Euro 7,948 million). The increase of shareholders’ equity
is mainly attributed to capital contribution in amount of Euro 8,100 made by parents companies, offset
by decrease of hedge reserves and retain earnings.
The net debt-to-equity ratio at 31 December 2021 came to a negative 96% (negative 176% at
31 December 2020). Please see Note 12 of financial statements for more detailed information about
Capital Management.


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Net financial debt
Millions of euro
at Dec.
31,
2021
at Dec.
31,
2020
Change
Long-term debt:
- bonds 30,721
28,858
1,863
Long-term debt 30,721
28,858
1,863
- loans to Group companies and affiliates (39,787)
(31,662)
(8,125)
Long term financial receivables (39,787)
(31,662)
(8,125)
Net long-term financial debt (9,066)
(2,804)
(6,262)
Short-term debt/(liquidity):
- bonds (short-term portion) 2,146
532
1,614
- l/t receivables due from Group companies and affiliates (short-term
portion)
(958)
(515)
(443)
Current amount of long-term net financial debt 1,188
17
1,171
- commercial paper 5,084
2,739
2,345
- short-term loans from Group companies and affiliates 434
461
(27)
Short-term loans 5,518
3,200
2,318
- short-term financial receivables due from Group companies and affiliates (1,637)
(402)
(1,235)
- cash collateral on derivatives (126)
(1,290)
1,164
- financial Service Agreement with Enel S.p.A. (5,310)
(2,275)
(3,035)
- cash and cash equivalents (218)
(172)
(46)
Cash and cash equivalents and short-term financial receivables (7,291)
(4,139)
(3,152)
Net short-term financial debt (585)
(922)
337
NET FINANCIAL DEBT (9,651)
(3,726)
(5,925)
Net financial debt amounted to negative Euro 9,651 million at 31 December 2021 (Euro 3,726 million
at 31 December 2020).
Net long-term financial debt totaled to negative Euro 9,066 million, having a sharp change by Euro
6,262 million due to an increase of long-term financial receivables (Euro 8,125 million) and a decrease
of long-term debt (Euro 1,863 million).
Bonds stood at Euro 30,721 million increased by Euro 1,863 million mainly due to the issuance of USD
and Euro bonds (Euro 10,130 million), positive exchange rates on the outstanding bonds denominated
in non-Euro currencies (Euro 1,236 million), amortized costs for the period (Euro 113 million), and
capitalized interest on zero-coupon bonds (Euro 10 million).
This increase was partly offset by the repurchase and partial refinancing of Euro and USD bonds (Euro
5,746 million), a reclassification due to at maturity 2022 within the current financial liabilities (Euro
3,846 million), and fair value adjustment of GBP SDG bond (Euro 34).
Long-term financial receivables total to Euro 39,787 million increased by Euro 8,125 million compared
to the same period of 2020 mainly due to new loans granted to Enel S.p.A. and Group companies in
and Brazil.
Net short-term financial liquidity decreased by Euro 337 million to Euro 585 million with the
change principally referring to:


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- reclassification of bond within the current financial liabilities (Euro 3,846 million);
- issue of commercial papers (Euro 2,345 million);
- decrease of cash collaterals on (Euro 1,164 million);
- repayment of current portion of loans (Euro 515 million);
- increase of impairment allowance over short-term financial receivables and current portion of
long-term loans (Euro 3 million).
This decrease was partly offset by:
- increase of service agreement with Enel Spa (Euro 3,035 million);
- increase of outstanding amount of revolving lines granted to Group companies and other
receivables (Euro 1,237 million);
- increase of cash and cash equivalents (Euro 46 million);
- repayment of bonds (Euro 2,232 million);
- decrease of deposits placed by Group companies (Euro 27 million);
- reclassification of current portion of long-term loans (Euro 959 million).
At 31 December 2021 gross financial debt amounted to Euro 38,385 million increased by Euro 5,795
million on the previous year.
Millions of Euro
at Dec. 31,
2021
at Dec. 31,
2020
Gross long-
term debt
Gross short-
term debt
Gross debt
Gross long-
term debt
Gross short-
term debt
Gross debt
Gross financial debt
32,867
5,518
38,385
29,390
3,200
32,590
of which:
-debt linked with the
achievement of SDGs
18,000
5,084
23,084
7,707
2,739
10,446
Debt connected with
achievement of SDGs/Total
gross financial debt (%)
60%
32%
Gross long-term debt (including the short-term portion) amounted to Euro 32,867 million, of which
Euro 18,000 million in respect of financing connected with achievement of SDG.


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Main Risks and uncertainties
In compliance with the provisions in Dutch Accounting Standard 400, the Company has drawn up
elements of its risk section as follows.
Methodology
Enel Finance International N.V. (“EFI”) adopts risk governance and control arrangements defined at
the Enel Group level and applicable for all wholly owned companies and companies with controlling
interest of the Enel Group, with specific reference to financial risks (market, credit and liquidity risks).
In order to mitigate its risk exposure, the Company conducts specific analysis, monitoring,
management and control activities.
The Company operates within Treasury Guidelines, which provide capital markets and treasury
operational framework. Based on current power of attorney, hedging are the subject of Board of
Directors consideration and approval.
Current or planned improvements in the risk management system
The Board of Directors considers that the existing system of risk management and internal controls
provides reasonable assurance that risks are properly assessed and managed to achieve business
objectives.
The most significant risks and the risk reduction measures taken
The Company is willing to bear a low-to-moderate level of residual risk for those factors that are
intrinsically related to the pursuit of its mission of providing financial services, including funding,
lending and liquidity management, to Enel Group companies, namely liquidity, interest rate, foreign
exchange, credit and counterparty risk.
Additionally, the Company, as a global issuer, is exposed to compliance risks with applicable laws and
regulation, as well as fiscal risk. No risk appetite is defined for compliance risks and the Company
control activities aim at ensuring full compliance and consequently, no residual risk is acceptable.
Financial risks
Credit risk and counterparty risk
Lending and hedging transactions expose the Company to credit and counterparty risk, i.e. the
possibility of a deterioration in the creditworthiness of its counterparties that could have an adverse
impact on the expected value of the creditor position or could lead to a failure to honor their
obligations.
The lending activity is the most important source of credit risk, and, for the very nature of its activity,
the Company is prepared to bear a medium level of risk. However, such level of risk is mitigated as
borrowers are related parties and in case of specific risk situations, deemed not in line with acceptable
level, has been further reduced receiving a guarantee by a relevant shareholder with higher
creditworthiness.
The Company has a consistent counterparty risk exposure to banking counterparties, stemming from
derivative transactions traded for hedging purposes and short term treasury activity. The Company
has a very low appetite to counterparty risk and pursues risk mitigation through the selection of
counterparties with a high credit standing and the adoption of specific standardized contractual
frameworks that contain risk mitigation clauses and possibly the exchange of cash collateral.


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Liquidity risk
Liquidity risk is the risk that the Company, while solvent, would not be able to discharge its obligations
in a timely manner or would only be able to do so on unfavorable terms owing to situations of tension
or systemic crises (credit crunches, sovereign debt crises, etc.) or changes in the perception of
Company riskiness by the market.
Among the factors that define the risk perceived by the market, the credit rating assigned to Enel
Finance International NV by rating agencies plays a decisive role, since it influences its ability to access
sources of financing and the related financial terms of that financing. A deterioration in the credit
rating could therefore restrict access to the capital market and/or increase the cost of funding, with
consequent negative effects on the performance and financial situation of the Company. In 2021,
Moody’s has revised its rating for Enel upwards, from “Baa2” to “Baa1”. Accordingly, at the end of the
year, Enel’s rating was: (i) “BBB+” with a stable outlook for Standard & Poor’s; (ii) “A-” with a stable
outlook for Fitch; and (iii) “Baa1” with a stable outlook for Moody’s. Short-term rating at the end of
the year was: (i) “A-2” for Standard & Poor’s; (ii) “P-2” for Fitch; and (iii) “F2” for Moody’s.
EFI liquidity risk management policies are designed to maintain a level of liquidity sufficient to meet
its obligations over a specified time horizon, without having recourse to additional sources of financing,
as well as to maintain a prudential liquidity buffer sufficient to meet unexpected obligations. In
addition, in order to ensure that the Company can meet its medium and long-term commitments, EFI
pursues a borrowing strategy that provides for a diversified structure of financing sources to which it
can turn and a balanced maturity profile. Another source of financing was provided by parent
companies as a capital contribution in amount of Euro 8,100 million. Additionally, ENEL SpA is the
guarantor for the repayment of the issued Bonds and Commercial Papers, which is a relevant
consideration for management with respect to their liquidity risk management procedures.
Please see Risk management section of financial statements for more detailed information about
liquidity risk.
Exchange rate
Due to its international funding and lending activity, the Company is significantly exposed to exchange
rate risk associated with cash flows and value of financial assets and liabilities denominated in foreign
currencies.
Consistently with the Enel Group risk policy and with the Company’s low risk appetite, the currency
profiles of funding and lending portfolios are balanced by making recourse to derivative transactions,
with the aim of minimizing the residual exposure, or by means of a back to back structure to prevent
high hedging fee associated to not liquid currencies or in the case of high volatility in the underling
financial operation.
Interest rate risk
The Company is exposed to the risk that changes in the level of interest rates could produce
unexpected changes in net financial expense or the value of financial assets and liabilities measured
at fair value, related to its funding, lending and hedging portfolios.
The exposure to interest rate risk derives mainly from the variability of the terms of financing and
lending, in case of new issues, and from the variability of the cash flows of floating-rate assets and
liabilities.


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The policy for managing interest rate risk aims to contain financial expense and its volatility by
optimizing the Company’s portfolio of financial assets and liabilities and by entering financial
derivatives on OTC markets.
A certain level of interest rate risk is intrinsic in the Company’s mission and has been actively managed
to ensure value creation.
Compliance risks
Fiscal risk
The Company may be subject to unfavorable changes in the respective tax laws and regulations. The
financial position of the Company may be adversely affected by new laws, changes in the interpretation
of existing laws or tax policy. The Company adopts a conservative approach based on an open
collaboration with tax authorities.
Compliance with current legislation
The Company is committed to a high level of compliance with relevant legislation, regulation, industry
codes and standards. Internal monitoring activities allow prompt identification of possible breaches of
compliance and consequent remediation actions, when needed.
Compliance with bond and loan agreements
Bonds final terms and loan agreements prescribe a set of covenants, which the Company as the
borrower and by Enel S.p.A. as guarantor should comply with. Any breaches and defaults may have
high adverse effect on the Company’s activity.
Internal monitoring activities allow prompt identification of possible breaches of compliance and
consequent remediation actions, when needed.
COVID-19 Impact
The outbreak of COVID-19 does not directly and significantly affect the ability of the Company and its
ultimate Parent to continue as a going concern. The volatility that characterized the financial markets
from the outset of the pandemic has in many cases returned to pre-COVID 19 levels and was offset
by risk mitigation actions using derivative financial instruments.
There are no significant changes in estimates of the recoverability of financial receivables. None of
borrowers has asked for forbearance or payment moratoria measures.


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Summary table
Following table represents the summary of main risks, controls and actions taken to mitigate risks.
Risk
area
Risk
component
Source of risk Risk control
Risk
appetite
Risk mitigation
Impact of
Company’s
results after
risk
mitigation
Financial risks
Credit and
counterparty
risk
Lending activity
Financial Risk Policy Medium
Related parties
Medium/Low
Cash deposits,
High credit profile,
cash collaterals
derivatives
Liquidity
risk
Different maturity of
funding and lending
facilities
Financial Risk Policy
Medium
Matching of short-
term cash-in and
cash-out
Low
Liquidity surplus
Monthly analysis of
funding-lending cash
flows
Available credit lines
Sufficient level of
available cash and
cash equivalents
Exchange
rate
Non-Euro
denominated funding
and lending
Financial Risk Policy
Medium
Full hedging
Low
policy with
derivatives
Treasury Guidelines
Interest rate
Floating rate
facilities
Financial Risk Policy Low Hedging Low
policy with
derivatives
Treasury guidelines
Future unknown
market conditions
Medium
Medium
Achievement of SDG
KPIs
Sustainable strategy
Very
low
Monitoring of the
sustainable plan
implementation
Very low
compliance risks
Fiscal
Change in applicable
tax laws or policy
Collaboration with tax
authorities
Nil
Collaboration and
regular
reconciliations with
tax authorities
Very low
Monitoring of
significant changes
Compliance
with current
legislation
Remote cases of
systems disruption,
new business
processes to be
integrated within
existing compliance
processes, possible
regulatory
uncertainties
Internal control
system
Nil
Permanent
improvement of
internal control
system and
procedures
Very low
Compliance
with bond
and loan
agreements
Covenants Covenants monitoring Nil
Preventive analysis of
covenants
compliance
Very low


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Quantification of the impact on the result and financial position if the main risks materialize
In 2021 the Company was exposed to exchange risk in relation with non-Euro denominated debt.
There was a significant exposure to fluctuation of the Euro against the U.S. dollar, which has recently
been subject to market volatility, British pound and Swiss franc.
At 31 December 2021 risk was fully covered by corresponding derivatives.
at Dec. 31,
2021
million euro Gross debt Derivatives After risk mitigation
Book value Notional value
Euro 18,332
18,668
55.98%
14,679
33,347
100.00%
US dollar 10,982
11,061
33.2%
(11,061)
-
0.00%
British pound 3,210
3,274
9.8%
(3,274)
-
0.00%
Swiss franc 344
344
1.0%
(344)
-
0.00%
Total Non-Euro 14,536
14,679
44.02%
(14,679)
-
0.00%
Total 32,868
33,347
100.00%
-
33,347
100.00%
At 31 December 2020 risk was fully covered by corresponding derivatives.
at Dec. 31,
2020
million euro Gross debt Derivatives After risk mitigation
Book value Notional value
Euro
13,060
13,510
45.12%
16,431
29,941
100.00%
US dollar 12,971
13,040
43.6%
(13,040)
-
0.00%
British pound 3,031
3,062
10.2%
(3,062)
-
0.00%
Swiss franc 328
329
1.1%
(329)
-
0.00%
Total Non-Euro 16,330
16,431
54.88%
(16,431)
-
0.00%
Total 29,390
29,941
100.00%
-
29,941
100.00%
The future significant variations in exchange rates would not materially and adversely affect the
Company’s financial position.
Please see Risk Management section for sensitivity analysis on exchange rate.
As shown in the table below, in 2021 the Company has low exposure to interest rate risk, nevertheless
the risk had not be fully eliminated. The Company used derivative instruments aiming at transforming
floating rate liabilities into fixed rate liabilities.
million euro
at Dec. 31,
2021
Before risk mitigation After risk mitigation
Floating rate 450
1.3%
50
0.1%
Fixed rate 32,897
98.7%
33,297
99.9%
Total
33,347
100.0%
33,347
100.0%


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The table below represented the exposure to interest risk in 2020.
million euro
at Dec. 31,
2020
Before risk mitigation After risk mitigation
Floating rate 450
1.5%
50
0.2%
Fixed rate 29,491
98.5%
29,891
99.8%
Total
29,941
100.0%
29,941
100.0%
The future significant variations in interest rates would not materially and adversely affect the
Company’s financial position.
Please see Risk Management section for sensitivity analysis on interest rate.
Related Parties
The main activity of Enel Finance International N.V. is to operate as financing company of the Enel
Group, raising funds through bonds issuance, loans and other facilities and on turn lending the funds
so raised to the companies belonging to the Enel Group; all the transactions are part of the ordinary
operations of the Company and are settled on arm’s length basis in line with Standard intra-Group
contract market prices.
Outlook
The Company should evolve normally during 2022, with the aim to maintain the same funding and
lending activities currently ongoing, keeping on supporting the Enel Group in its developing and
consolidation process.
The outbreak of COVID-19 does not impact the assessment of the ability to continue as a going
concern.
The escalation of the conflict between Russia/Belarus and the Ukraine and the imposition of sanctions
by EU and other governments on various Russian/Belarus organizations and individuals so far has
remote impact on the Company’s activity and no impact on 2021 financial statements. In this
constantly evolving environment, the Company is carefully monitoring international developments,
promptly assessing the impact of its business activities and financial situation.
Board of Directors composition
The Company’s organization is characterized by a Board of Directors charged with managing the
Company and a Shareholders’ Meeting.
The Company is a so-called Public Interest Entity (“Organisatie van Openbaar Belang”), since it has
issued listed bonds on EU-regulated markets, which requires the establishment of an audit committee.
The Company however makes use of the exemption in Article 3(a) of the Dutch Decree on the Audit
Committee ("Besluit instelling auditcommissie") as foreseen in Article 39(3)(a) of Directive
2006/43/CE, as amended by Directive 2014/56/EU of the European Parliament and of the Council, as
its Parent Company (Enel S.p.A.) is an entity that fulfils the requirements set out in paragraphs 39(1),
(2) and (5) of Directive 2006/43/CE, as amended by Directive 2014/56 EU, Article 11(1), Article 11(2)
and Article 16(5) of Regulation (EU) No 537/2014 of the European Parliament and of the Council.


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Pursuant to Article 19, subsection 2 of Italian Legislative Decree 39/2010 - as amended by Legislative
Decree 135/2016, implementing Directive 2014/56 EU - the audit committee of Enel S.p.A. coincides
with the “collegio sindacale” (board of statutory auditors). According to the legislation in force, the
members of the board of statutory auditors of Enel S.p.A. must possess the requisites of integrity,
professionalism and independence imposed upon the statutory auditors of listed companies, as
supplemented (only as regards the professionalism requisites) by specific provisions of the bylaws.
The Company does not have its own diversity policy, but follows the diversity policy of Enel S.p.A.,
which strives for example to have equal hiring of male/female and to increase the number of female
managers. The Company believes that the composition of its Board of directors has a broad diversity
of experience, expertise and backgrounds, and that the backgrounds and qualifications of the
directors, considered as a group, provide a significant mix of experience, knowledge, abilities and
independence that we believe will allow our board of directors to fulfill its responsibilities and properly
execute its duties.
Remuneration of Directors is defined in accordance with Remuneration policy of the management
board of Enel Finance International N.V., recently amended by the Shareholder (Resolution of the Sole
Shareholder 23.01.2017)
The Company’s control system
The appropriateness of the administrative and accounting procedures used in the preparation of the
financial statements has been verified in the assessment of the internal control system for financial
reporting. The assessment of the internal control system for financial reporting did not identify any
material issues.
On 16 December 2016 the Company adopted the new Enel Global Compliance Program (“EGCP”),
addressed to the foreign subsidiaries of the Enel Group. The aim of EGCP is to reinforce the
commitment of the Company to the highest ethical, legal and professional standards for enhancing
and preserving the reputation as well as the prevention of criminal behaviour abroad, which may lead
to a corporate criminal liability to the Company.
The Company follows the “Zero-Tolerance-of-Corruption Plan” (ZTC Plan) adopted by the Enel Group
in 2006, confirming the commitment, as also described in the Code of Ethics, to ensure propriety and
transparency in conducting company business and operations and to safeguard our image and
positioning, the work of our employees, the expectations of shareholders and all of the Enel Group’s
stakeholders.
Subsequent events
Triple-tranche 2.75 billion euro “Sustainability-Linked Bond” in the Eurobond market
On 10 January 2022 the Company launched a multi-tranche “Sustainability-Linked bond for
institutional investors in the Eurobond market for a total of 2.75 billion euros.
Specifically, the issue is structured in the following three tranches:
- 1,250 million euros at a fixed rate of 0.250%, with settlement date set on January 17th, 2022,
maturing November 17th, 2025:
the issue price has been set at 99.829% and the effective yield at maturity is equal to 0.295%;


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19
the interest rate will remain unchanged to maturity, subject to the achievement of a
Sustainability Performance Target (“SPT”) equal to or lower than 148gCO2eq/kWhas of December
31st, 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by an external
verifier in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Group;
- 750 million euros at a fixed rate of 0.875%, with settlement date set on January 17th, 2022,
maturing January 17th, 2031:
the issue price has been set at 98.700% and the effective yield at maturity is equal to 1.027%;
the interest rate will remain unchanged to maturity, subject to the achievement of an SPT
equal to or lower than 140gCO2eq/kWhas of December 31st, 2024;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by an external
verifier in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Group;
- 750 million euros at a fixed rate of 1.250%, with settlement date set on January 17th, 2022,
maturing January 17th, 2035:
the issue price has been set at 99.334% and the effective yield at maturity is equal to 1.306%;
the interest rate will remain unchanged to maturity, subject to the achievement of an SPT
equal to or lower than 82gCO2eq/kWhas of December 31st, 2030;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by an external
verifier in respect of the Direct Greenhouse Gas Emissions Amountand the methodology for
measuring CO2eq emissions applied by the Group.
750 million pound sterling “Sustainability-Linked Bond”
On 5 April 2022 the Company launched in the market a pound sterling single-tranche “Sustainability-
Linked Bond” for institutional investors totaling 750 million pounds sterling, equivalent to
approximately 900 million euros.
The new issuance is linked to the achievement of Enel’s sustainability objective relating to the
reduction of direct greenhouse gas emissions (Scope 1), contributing to United Nations Sustainable
Development Goal 13 (Climate Action) and in accordance with the Enel Group’s Sustainability-Linked
Financing Framework
The issuance is structured as a single tranche of 750 million pounds sterling paying a rate of 2.875%
maturing on 11 April 2029. The issue price has been set at 99.947% and the effective yield at maturity
is equal to 2.883%. The settlement date for the issue is on 11 April 2022.
The interest rate will remain unchanged to maturity, subject to the achievement of an SPT equal to or
lower than 140gCO2eq/kWh at December 31st, 2024.


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Geopolitical Crisis
Following the conflict between Russia and Ukraine, the Enel Group has carefully monitored the
evolution of this geopolitical crisis by assessing any potential impact on its operations and
consequences for its business.
Today, the Enel Group is present in Russia with a number of companies in which it holds control or
joint control with other investors. The Russian companies of Enel are involved in the electricity
generation, energy trading and ancillary services.
The contribution of the Russian companies to the main consolidated performance aggregates in 2021
(considering the average 2021 euro/ruble exchange rate of 87.18) is not significant and includes
revenue of 564 million (0.6% of the total consolidated revenue of the Enel Group), operating profit
of 51 million (0.7% of total Enel Group operating profit) and profit of 64 million (2.0% of Enel Group
profit).
No assets are held by the Enel Group in Ukraine and Belarus.
The Enel Group has activated a task force to carefully monitor macroeconomic and business variables
in order to develop the most accurate real-time estimates of impacts connected with regulatory
changes, sanctions and restrictions on assets, as well as on suppliers and contracts applicable to the
Enel Group, taking due account of the recommendations issued by national and supranational
organizations on this issue.
The Company has no operations with Enel subsidiaries in Russia and has no other direct exposure in
respect of Russia, Ukraine or Belarus.
Further escalation of the conflict may have indirect consequences for the Company, which are difficult
to quantify but the Company is paying appropriate attention to the developments.
Reporting of non-financial information
The Enel Group, in the implementation of the new EU (Directive 2014/97/EU) and national legislation
that has been introduced as mandatory of non-financial information from 2021 financial year for large
public-interest entities, has drafted a “Consolidated Non-Financial Statement” that covers the areas
provided for in that decree, accompanying the Group’s Sustainability Report.
Report can be obtained from the investor relations section of Enel S.p.A. official website
(http://www.enel.com).
Personnel
At 31 December 2021 the Company had, other than the directors, eleven employees (eleven people
at 31 December 2020). Average headcount comprised ten people (ten people for the 2020). All people
worked in the Netherlands.


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Statement of the Board of Directors
Statement ex Article 5:25c Paragraph 2 sub c Financial Markets Supervision Act (“Wet op net
Financieel Toezicht”).
To our knowledge,
- the financial statements give a true and fair view of the assets, liabilities, financial position
and result of Enel Finance International N.V.;
- the Director’s Report gives a true and fair view of the Company’s position as per 31 December
2021 and the developments during the financial year 2021;
- the Director’s Report describes the principal risks the Company is facing.
This annual report is prepared according to International Financial Reporting Standards as adopted by
the European Union (“IFRS-EU”) and its financial statement is audited by KPMG Accountants N.V. The
company complies with the conditions of article 3:2 Wft and therefore makes use of the group
financing company exemption”
Furthermore this annual report complies with the EU Transparency Directive enacted in the
Netherlands in 2008 and subsequently came into force as from 1 January 2009. The Company has to
comply with this transparency Directive, since the nominal value for certain bonds is lower than EUR
100.000. The Company’s main obligations under the aforementioned Transparency Directive can be
summarized as follows:
- filing its approved annual financial statements electronically with the AFM (Autoriteit Financiele
Markten) in the Netherlands within five days after their approval;
- making its annual financial report generally available to the public by posting it on Enel S.p.A.
official website within 4 months after the end of the 2021 fiscal year (by 30 April 2022);
- making its annual financial report generally available to the public by issuing an information
notice on a financial newspaper or on a financial system at European level within 4 months
after the end of the 2021 fiscal year (by 30 April 2022).
Amsterdam, 29 April 2022
A. Canta
E. Di Giacomo
H. Marseille
A.J.M. Nieuwenhuizen


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22
Financial statements
for the year ended 31 December 2021
prepared in ac
cordance with International
Financial Reporting Standards as adopted by
the European Union


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23
Statement of comprehensive income
Millions of euro Note
2021 2020
Interest income
Interest income 1 691
757
Interest income from derivatives 1 321
326
Other interest related income 1 -
710
(Subtotal)
1,012
1,793
Interest expenses
Interest expenses 1 (1,282)
(1,212)
Interest expense from derivatives 1 (192)
(233)
Other interest related expenses 1 (634)
(4)
(Subtotal)
(2,108)
(1,449)
Net interest income/ (expense)
(1,096)
344
Other operating expense 2 (5)
(5)
Financial income
Financial income from derivatives 3 1,700
360
Other financial income 3 299
1,424
(Subtotal)
1,999
1,784
Financial expense
Financial expense from derivative 3 (519)
(1,483)
Other financial expense 3 (1,294)
(345)
(Subtotal)
(1,813)
(1,828)
Net financial income/ (expense)
186
(44)
Income/(Loss) before taxes
(915)
295
Income Taxes 4 (175)
78
Net income/(loss) for the year (attributable to the shareholders)
(740)
217
Other components of comprehensive income recyclable to profit or loss in
future periods:
- effective portion of change in fair value of cash flow hedges net of deferred taxes 17 403
130
- Change in the fair value of costs of hedging net of deferred taxes 17 185
(101)
Total comprehensive income/(loss) for the period (attributable to the
shareholders)
(152)
246


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Statement of financial position
Millions of Euro Note
ASSETS
at Dec.31,
at Dec.31,
2021
2020
Non-current assets
Deferred tax assets 5 373
-
Long-term loans and financial receivables 6 39,787
31,662
Derivatives 7 671
144
Other non-current financial assets 8 38
37
(Subtotal)
40,869
31,843
Current assets
Current portion of long-term loans and financial receivables 6 958
515
Short-term loans and financial receivables 9 6,947
2,677
Derivatives 7 3
54
Other current financial assets 10 662
1,579
Other current assets
-
8
Income tax receivable
5
Cash and cash equivalents 11 218
172
(Subtotal)
8,793
5,005
TOTAL ASSETS
49,662
36,848
LIABILITIES AND SHAREHOLDERS’ EQUITY
Share capital 12 1,479
1,479
Share premium reserve 12 9,126
1,026
Cash flow hedge reserve 12 (508)
(911)
Cost of hedging reserve 12 2
(183)
Retained earnings 12 705
488
Net income for the period 12 (740)
217
Total shareholder's equity
10,064
2,116
Non-current liabilities
Long-term borrowings 13 30,721
28,858
Deferred tax liabilities 5 16
-
Derivatives 7 473
1,539
Other non-current financial liabilities
49
51
(Subtotal)
31,259
30,448
Current liabilities
Income tax payable
1
46
Current portion of long-term borrowings 13 2,146
532
Short-term borrowings 14 5,842
3,305
Derivatives 7 25
4
Other current financial liabilities 15 323
395
Other current liabilities
2
2
(Subtotal)
8,339
4,284
TOTAL EQUITY AND LIABILITIES
49,662
36,848


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Statement of changes in equity
Millions of euro
Share
capital
Share
premium
reserve
Cash flow
hedge
reserve
Costs of
hedging
reserve
Retained
earnings
Net income for
the period
Equity attributable
to the shareholders
At January 1, 2020 1,479
1026
(1,041)
(82)
408
80
1,870
Allocation of net income from the previous year -
-
-
80
(80)
-
Comprehensive income for the year: -
-
130
(101)
-
217
246
of which:
- other comprehensive income (loss) for the period -
-
130
(101)
-
-
29
- net income for period -
-
-
217
217
At January 1, 2021 1,479
1,026
(911)
(183)
488
217
2,116
Allocation of net income from the previous year -
-
-
217
(217)
-
Capital contribution -
8,100
-
-
-
-
8,100
Comprehensive income for the year: -
-
403
185
-
740
(152)
of which:
- other comprehensive income (loss) for the period -
-
403
185
-
-
588
- net income for period -
-
-
-
(740)
(740)
At December 31, 2021 1,479
9,126
(508)
2
705
(740)
10,064


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26
Statement of cash flows
Millions of euro Note
2021 2020
Income for the period
(740)
217
Adjustments for:
Interest (income) 1 (1,012)
(1,467)
Interest expense 1 2,108
1,216
Financial (income) 3 (1,999)
(2,110)
Financial expense 3 1,813
2,061
Income taxes 4 (175)
78
(Increase)/Decrease in working assets and other assets/liabilities
1,275
(672)
Interest income and other financial income collected
663
777
Interest expense and other financial expense paid
(1,720)
(1,147)
Income taxes paid
(39)
(32)
Cash flows from operating activities (a)
169
(1,079)
New loans granted to Enel S.p.A. and affiliates
(13,855)
(14,946)
Repayments from Enel S.p.A. and affiliates
1,250
15,935
Cash flows from investing/disinvesting activities (b)
(12,605)
989
Financial debt (new borrowings) 13,14 12,467
2,990
Financial debt (repayments) 13,14 (8,092)
(2,938)
Capital contribution
8,100
Cash flows from financing activities (c)
12,475
52
Impact of exchange rate fluctuations on cash and cash equivalent
(d)
7
-
Increase/(Decrease) in cash and cash equivalents (a+b+c+d)
46
(38)
Cash and cash equivalents at the beginning of the year
172
210
Cash and cash equivalents at the end of the year
218
172


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27
Notes to the financial statements
Form and content of the financial statement
Enel Finance International N.V. (“the Company”) is as a limited liability company under the laws of
the Netherlands on 26 September 2008. The Company is registered with the trade register of the
Dutch chamber of commerce under number 34313428 with business address at Herengracht 471,
1017 BS Amsterdam, the Netherlands. The Company is established for an indefinite duration.
The 74.99% of the shares of the Company are held by Enel Holding Finance S.r.l (direct parent) and
the 25.01% of the shares are held by Enel S.p.A., both companies, have their seats in Rome, Italy.
100% of shares of Enel Holding Finance S.r.l. are held Enel S.p.A.
Therefore, Enel S.p.A. is the ultimate controlling shareholder of the Company.
Company’s financial statements are included into the consolidated financial statements of Enel S.p.A.,
which can be obtained from the investor relations section of Enel S.p.A. official website
(http://www.enel.com).
Corporate purpose
The Company operates as a financing company for the Group, raising funds through bond issuances,
loans and other facilities and on turn, lending the funds so raised to the companies belonging to the
Enel Group. The Company is also part of the centralised financial process at the Enel Group level and
acts as the primary reference for the management of financial needs or liquidity generated by the Enel
Group companies.
The Company acts solely as a financing company for the Enel Group and therefore is not engaged in
market competition in the energy sector with third parties.
The Company is managed by a Board of Directors composed of five members, appointed by the general
meeting of shareholders, which may dismiss them at any time. The Board of Directors has the power
to perform all acts of administration and disposition in compliance with the corporate objects of the
Company.
The joint signatures of any two members of the management board or the single signature of any
person to whom such signatory shall have been appointed by the management board may bind the
Company.
Compliance with IFRS/IAS
The financial statements for the year ended 31 December 2021 have been prepared in accordance
with international accounting standards (International Accounting Standards IAS and International
Financial Reporting Standards IFRS) issued by International Accounting Standards Board (IASB),
the interpretations of the International Financial Reporting Interpretations Committee (IFRIC) and the
Standing Interpretations Committee (SIC), endorsed by the European Union pursuant to Regulation
(EC) no. 1606/2002 and in effect as of the close of the year. All of these standards and interpretations
are hereinafter referred to as the “IFRS-EU”. The financial statements have also been prepared in
conformity with the statutory provisions of the Netherlands Civil Code, Book 2, Title 9 and specifically
Section 2:362(9).
The financial statements were approved by the Board of Directors and authorised for issue effective
on 11 March 2022, with an update on the final version as per today.


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28
Basis of presentation
The financial statements consist of the statement of comprehensive income, the statement of financial
position, the statement of changes in equity, the statement of cash flows, and the related notes.
The assets and liabilities reported in the financial position are classified on a “current/non-current
basis”. Current assets, which include cash and cash equivalents, are assets that are intended to be
used during the normal operating cycle of the Company or in the twelve months following the balance-
sheet date; current liabilities are liabilities that are expected to be settled during the normal operating
cycle of the Company or due within the twelve months following the close of the financial year.
The income statement is classified on the basis of the nature of expenses, while the indirect method
is used for the cash flow statement.
Financial assets and liabilities are offset and the net amount presented in the statement of financial
position when, and only when, the Company has a legal right to offset the amounts and intends either
to settle on a net basis or to realize the asset and settle the liability simultaneously.
Change presentation of the Statement of Comprehensive income
During the reporting year 2021 the Company has reclassified interest income / interest expenses from
derivatives to the top lines Interest Income and Interest Expense respectively, split from Net Financial
income/ (expense).
As a consequence, for 2020 the amounts of Euro 326 million and Euro (233) million have been
reclassified in the top lines for comparative purpose only.
Functional and presentation currency
The financial statements are presented in euro, the functional currency of Enel Finance
International N.V. All figures are shown in millions of euro unless stated otherwise.
The accounting policies set out below have been applied consistently to all periods presented in these
financial statements.
The financial statements have been prepared on a going concern basis using the cost method, with
the exception of items measured at fair value in accordance with IFRS-EU.
Based upon the assessment of management, supported by the fact that Enel S.p.A. is the guarantor
of the bonds and the ECPs, management has not identified any going concern triggers and therefore
has prepared these financial statements on a going concern basis.
Since ENEL S.p.A. is the guarantor of the issued bonds and ECP’s and based on an internal compliance
policy, Enel S.p.A. is committed to provide financial support to the Company, should it not be able to
meet its obligations. In relation to this, this annual commitment has been formally re-confirmed by
Enel S.p.A. in a support letter issued on 3 February 2022, which is valid until next year’s approval
date of the Financial Statements, should the company remain under control of the Enel Group.
Solvency
Given the objectives of the company, the Company is highly economically interrelated with Enel S.p.A.
In assessing the solvency as well as the general risk profile of the Company, the solvency of the Enel
Group as a whole, headed by Enel S.p.A. should be considered.


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29
Accounting policies and measurement criteria
COVID-19 disclosures
Given the complexities of the current environment, the Company has analysed the impacts of COVID-
19 on business activities, on the financial situation and on performance that are reported in the
paragraph“COVID-19 impacts” of the Director’s report.
Use of estimates and management judgments
Preparing the financial statements under IFRS-EU requires the use of estimates and assumptions that
affect the carrying amount of assets and liabilities and the related information on the items involved,
as well as the disclosure required for contingent assets and liabilities at the balance sheet date. The
estimates and the related assumptions are based on previous experience and other factors considered
reasonable in the circumstances. They are formulated when the carrying amount of assets and
liabilities is not easily determined from other sources. The actual results may therefore differ from
these estimates. The estimates and assumptions are periodically revised and the effects of any
changes are reflected in the income statement if they only involve that period. If the revision involves
both the current and future periods, the change is recognized in the period in which the revision is
made and in the related future periods
Expected credit losses on financial assets
Loss allowances for financial assets are based on assumptions about risk of default and on the
measurement of expected credit losses. Management uses judgement in making these assumptions
and selecting the inputs for the impairment calculation, based on the Company’s past history, existing
market conditions as well as forward looking estimates at the end of each reporting period.
Determining the fair value of financial instruments
Fair value of financial instruments is determined on the basis of prices directly observable in the
market, where available, or, for unlisted financial instruments, using specific valuation techniques
(mainly based on present value) that maximise the use of observable market inputs. In the rare
circumstances were this is not possible, the inputs are estimated by management considering the
characteristics of the instruments being measured.
Recovery of deferred tax assets
The financial statements report deferred tax assets in respect of income components whose
deductibility is deferred in an amount whose recovery is considered by management to be probable.
The recoverability of such assets is subject to the achievement of future profits sufficient to absorb
such tax losses and to use the benefits of the other deferred tax assets.
Significant management judgement is required to determine the amount of deferred tax assets that
can be recognised, based upon the likely timing and the level of future taxable profits together with
future tax planning strategies and the tax rates enacted or substantially enacted at the date of
reversal.
Classification and measurement of financial assets
At initial recognition, in order to classify financial assets as financial assets at amortised cost, at fair
value through other comprehensive income and at fair value through profit or loss, management
assesses both the contractual cash flows characteristics of the instrument and the business model
for managing financial assets in order to generate cash flows.


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30
For the purpose to evaluate the contractual cash flows characteristics of the instrument,
management performs the “SPPI test” at an instrument level, in order to define if it gives rise to cash
flows that are solely payments of principal and interest on the principal amount outstanding, performing
specific assessment on the contractual clauses of the financial instruments, as well as quantitative
analysis, if required.
The business model determines whether cash flows will result from collecting contractual cash flows,
selling the financial assets, or both.
Hedge Accounting
Hedge accounting is applied to derivatives in order to reflect into the financial statements the effect
of risk management strategies.
At such regard, the Company documents at the inception of the transaction the hedge relationship
between hedging instruments and hedged items, as well as its risk management objectives and
strategy. The Company also assesses, both at hedge inception and on an ongoing basis, whether
hedging instruments are highly effective in offsetting changes in fair values or cash flows of hedged
items.
Based on management judgement, the effectiveness assessment based on the existence of an
economic relationship between the hedging instruments and the hedged items, on the dominance of
credit risk on the value changes and on the hedge ratio, as well as the measurement of the
ineffectiveness, is evaluated through a qualitative assessment and/or a quantitative computation,
depending on the specific facts and circumstances and on the characteristics of the hedged items and
the hedging instruments.
For cash flow hedges of forecast transactions designated as hedged items, management assesses and
documents to what extent they are highly probable and present an exposure to changes in cash flows
that affect profit or loss.
Moreover, during the year, the Company has carefully monitored the effect of uncertainties related to
the COVID-19 pandemic on its hedge accounting relationships.
Uncertainty over income tax treatments
The Company determines whether to consider each uncertain income tax treatment separately or
together with one or more other uncertain tax treatments as well as whether to reflect the effect of
uncertainty by using the most likely amount or the expected value method (intended as sum of the
probability-weighted amounts in a range of possible outcomes), depending on which approach the
Company expects to better predicts the resolution of the uncertainty for each uncertain tax
treatments, taking account of local tax regulations.
The Company applies judgment in identifying uncertainties over income tax treatments and reassesses
any judgments and estimates made if a change in facts and circumstances might change a conclusions
about the acceptability of a tax treatment or the estimate of the effect of uncertainty, or both.
Significant accounting policies
Related parties
Related parties are mainly parties that have the same parent entity as Enel Finance International N.V.,
companies that directly or indirectly through one or more intermediaries control, are controlled or are
subject to the joint control of the Company. In addition, statutory directors, other key management
of the Company or the ultimate parent company and close relatives are regarded as related parties.


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Translation of foreign currencies
Transactions in currencies other than the functional currency are recognized in these financial
statements at the exchange rate prevailing on the date of the transaction.
Monetary assets and liabilities denominated in a foreign currency other than the functional currency
are later adjusted using the balance sheet exchange rate.
Any exchange rate differences are recognized in profit or loss.
Fair value measurement
For all fair value measurements and disclosures of fair value, that are either required or permitted by
international accounting standards, the Company applies IFRS 13.
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability,
in an orderly transaction, between market participants, at the measurement date (i.e. an exit price).
The fair value measurement assumes that the transaction to sell an asset or transfer a liability takes
place in the principal market, i.e. the market with the greatest volume and level of activity for the
asset or liability. In the absence of a principal market, it is assumed that the transaction takes place
in the most advantageous market to which the entity has access, i.e. the market that maximizes the
amount that would be received to sell the asset or minimizes the amount that would be paid to transfer
the liability.
The fair value of an asset or a liability is measured using the assumptions that market participants
would use when pricing the asset or liability, assuming that market participants act in their economic
best interest. Market participants are independent, knowledgeable sellers and buyers who are able to
enter into a transaction for the asset or the liability and who are motivated but not forced or otherwise
compelled to do so.
When measuring fair value an entity shall take into account the characteristics of the asset or liability,
in particular:
- for a non-financial asset, a fair value measurement takes into account a market participant’s
ability to generate economic benefits by using the asset in its highest and best use or by selling
it to another market participant that would use the asset in its highest and best use;
- for liabilities and own equity instruments, the fair value reflects the effect of non-performance
risk, i.e the risk that an entity will not fulfill an obligation, including but not limited to the
entity’s own credit risks;
- in the case of groups of financial assets and financial liabilities with offsetting positions in market
risk or counterparty credit risk, managed on the basis of an entity’s net exposure to such risks,
it is permitted to measure fair value on a net basis.
In measuring fair value of assets and liabilities, the Group uses valuation techniques that are
appropriate in the circumstances and for which sufficient data are available, maximizing the use of
relevant observable inputs and minimizing the use of unobservable inputs.
Financial instruments
Financial instruments are any contract that gives rise to a financial asset of one entity and a financial
liability or equity instrument of another entity; they are recognised and measured in accordance with
IAS 32 and IFRS 9.


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A financial asset or liability is recognised in the financial statements when, and only when, the
Company becomes party to the contractual provision of the instrument (trade date).
Conversely, the Company initially measures financial assets at their fair value plus, in the case of a
financial asset not at fair value through profit or loss, transaction costs.
Financial assets are classified, at initial recognition, as financial assets at amortised cost, at fair value
through other comprehensive income and at fair value through profit or loss, on the basis of both
Company’s business model and the contractual cash flows characteristics of the instrument.
For this purposes, the assessment in order to define if the instrument gives rise to cash flows that are
solely payments of principal and interest (SPPI) on the principal amount outstanding, is referred to as
the SPPI test and is performed at an instrument level.
The Company’s business model for managing financial assets refers to how it manages its financial
assets in order to generate cash flows. The business model determines whether cash flows will result
from collecting contractual cash flows, selling the financial assets, or both.
For purposes of subsequent measurement, financial assets are classified in four categories:
- financial assets at amortised cost (debt instruments);
- financial assets at fair value through OCI with recycling of cumulative gains and losses (debt
instruments);
- financial assets designated at fair value through OCI with no recycling of cumulative gains and
losses upon derecognition (equity instruments); and
- financial assets at fair value through profit or loss.
Financial assets measured at amortised cost
This category mainly includes trade receivables, other receivables and financial receivables.
Financial assets at amortised cost are held within a business model whose objective is to hold financial
assets in order to collect contractual cash flows and whose contractual terms give rise, on specified
dates, to cash flows that are solely payments of principal and interest on the principal amount
outstanding.
Such assets are initially recognised at fair value, adjusted for any transaction costs, and subsequently
measured at amortised cost using the effective interest method and are subject to impairment.
Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired.
Impairment of financial assets
At the end of each reporting date, the Company recognizes a loss allowance for expected credit losses
on trade receivables and other financial assets measured at amortised cost and all other assets in the
scope of IFRS 9 expected credit loss model.
The Company impairment model is based on the determination of expected credit losses (ECL) using
a forward- looking approach. In essence, the model provides for:
- the recognition of expected credit losses on an ongoing basis and the updating of the amount
of such losses at the end of each reporting period, reflecting changes in the credit risk of the
financial instrument;


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- the measurement of expected losses on the basis of reasonable information, obtainable without
undue cost, about past events, current conditions and forecasts of future conditions.
For all financial assets, other than trade receivables, the Company applies the general approach under
IFRS 9, based on the assessment of a significant increase in credit risk since initial recognition. Under
such approach, loss allowance on financial assets is recognized at an amount equal to the lifetime
expected credit losses, if the credit risk on those financial assets has increased significantly, since
initial recognition, considering all reasonable and supportable information, including also forward-
looking inputs.
If at the reporting date, the credit risk on financial assets has not increased significantly since initial
recognition, the Company measures the loss allowance for those financial assets at an amount equal
to 12-month expected credit losses.
For financial assets on which loss allowance equals to lifetime expected credit losses has been
recognized in the previous reporting date, the Company measures the loss allowance at an amount
equal to 12-month expected credit losses when significant increase in credit risk condition is no longer
met.
The Company recognizes in profit or loss, as impairment gain or loss, the amount of expected credit
losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount
that is required to be recognized in accordance with IFRS 9.
The loss allowances for financial assets are based on assumptions about risk of default and expected
credit losses. The Company uses judgement in making these assumptions and selecting the inputs for
the impairment calculation, based on the Company’s past history, existing market conditions as well
as forward looking estimates at the end of each reporting period.
Cash and cash equivalents
This category includes deposits that are available on demand or at very short term, as well as highly
short-term liquid financial investments that are readily convertible into a known amount of cash and
which are subject to insignificant risk of changes in value.
Financial liabilities at amortised cost
This category mainly includes borrowings, trade payable and debt instruments.
Financial liabilities, other than derivatives, are recognised when the Company becomes a party to the
contractual clauses of the instrument and are initially measured at fair value adjusted for directly
attributable transaction costs. Financial liabilities are subsequently measured at amortised cost using
the effective interest rate method.
Derecognition of financial assets and liabilities
Financial assets are derecognised whenever one of the following conditions is met:
- the contractual right to receive the cash flows associated with the asset expires;
- the Company has transferred substantially all the risks and rewards associated with the asset,
transferring its rights to receive the cash flows of the asset or assuming a contractual obligation
to pay such cash flows to one or more beneficiaries under a contract that meets the
requirements provided by IFRS 9 (the “pass through test”);
- the Company has not transferred or retained substantially all the risks and rewards associated
with the asset but has transferred control over the asset.


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Financial liabilities are derecognised when they are extinguished, i.e. when the contractual obligation
has been discharged, cancelled or expired.
When an existing financial asset or liability is replaced by another from the same borrower or lender
on substantially different terms, or the terms of an existing asset or liability are substantially modified,
such an exchange or modification is treated as the derecognition of the original asset or liability and
the recognition of a new asset or liability. The difference in the respective carrying amounts is
recognised in profit or loss.
Derivative financial instruments
A derivative is a financial instrument or another contract:
- whose value changes in response to the changes in an underlying variable such as an interest
rate, commodity or security price, foreign exchange rate, a price or rate index, a receivable
rating or other variable;
- that requires no initial net investment, or one that is smaller than would be required for a
contract with similar response to changes in market factors;
- that is settled at a future date.
Derivative instruments are classified as financial assets or liabilities depending on the positive or
negative fair value and they are classified as “held for trading” within “Other business model” and
measured at fair value through profit or loss, except for those designated as effective hedging
instruments.
For more details about hedge accounting, please refer to the note 17 “Derivatives and hedge
accounting”.
All derivatives held for trading, are classified as current assets or liabilities.
Derivatives not held for trading purposes, but measured at fair value through profit or loss since they
are not designed as hedge instruments for hedge accounting and derivative designated as effective
hedging instruments are classified as current or not current on the basis of their maturity date and
the Group intention to hold the financial instrument till maturity or not.
Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary
shares and share options are recognized as a deduction from equity, net of any tax effects.
Reference is made to note 13 for the other relevant elements of equity.
Interest income and expense
Interest income and expense is recognized on an accruals basis in line with interest accrued on the
net carrying amount of the related financial assets and liabilities using the effective interest method.
Interest income is recognised to the extent that it is probable that the economic benefits will flow to
the Company and the amount can be reliably measured.
Other interest income and expense
Other interest income and expense primarily includes gain/loss on the disposal of financial assets/
liabilities that are not an output of the Company’s ordinary activity.


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Financial income and expense
Financial income and expense from derivatives include:
- income and expense from derivatives measured at fair value through profit or loss;
- income and expense from fair value hedge derivatives;
- income and expense from cash flow hedge derivatives on interest rate and foreign exchange
risks.
Financial income and expense include also changes in the fair value of financial instruments other than
derivatives.
Dividends
Dividends and interim dividends payable to the Company’s sole shareholder are recognized as changes
in equity at the date they are approved by the Shareholders’ Meeting and the Board of Directors,
respectively.
Income taxes
Income tax expense comprises current and deferred tax.
Corporate income tax is calculated on the basis of the profit before taxation shown in the Statement
of comprehensive income, taking into account tax allowances and tax adjustments. As of 1 January
2015, the Company forms part of a fiscal unity with Enel Investment Holding B.V, whereby the
Company is the head of the fiscal unity. Starting from 1 January 2020 Enel Insurance N.V. has joined
the fiscal unity.
The Company is jointly and severally liable for all corporate income tax liabilities of the fiscal unity.
Taxation for entities within the fiscal unity is calculated on a stand-alone basis.
Current tax and deferred tax are recognised in profit or loss except to the extent that it relates to a
business combination, or items recognised directly in equity or in other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using
tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable
in respect of previous years. Current tax payable also includes any tax liability arising from the
declaration of dividends.
Deferred tax liabilities and assets are calculated on the temporary differences between the carrying
amounts of assets and liabilities in the financial statements and their corresponding values recognized
for tax purposes on the basis of tax rates in effect on the date the temporary difference will reverse,
which is determined on the basis of tax rates that are in force or substantively in force at the balance
sheet date.
Deferred tax assets are recognized when recovery is probable, i.e. when an entity expects to have
sufficient future taxable income to recover the asset.
The recoverability of deferred tax assets is reviewed at each year-end. Taxes in respect of components
recognized directly in equity are taken directly to equity.


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Recently issued accounting standards and Standards issued but not yet effective
New accounting standards applied in 2021
The Company has applied the following new standards, interpretation and amendments that took
effect as from January 1, 2021:
“Amendments to IFRS 9, IAS 39, IFRS 7, and IFRS 16 - Interest Rate Benchmark Reform -
Phase 2”, issued in August 2020. The amendments complement those issued in 2019 (“Interest Rate
Benchmark Reform-Phase 1”) and address issues that might affect financial reporting after the reform
of an interest rate benchmark, including its replacement with alternative benchmark rates. The
objectives of the Phase 2 amendments are to assist entities in: (i) applying IFRS Standards when
changes are made to contractual cash flows or hedging relationships because of the interest rate
benchmark reform; and (ii) providing useful information to users of financial statements. Moreover,
when the Phase 1 reliefs cease to apply, entities are required to amend the hedge documentation to
reflect changes that are required by IBOR reform by the end of the reporting period during which the
changes are made (such amendments do not constitute a discontinuation). The amounts accumulated
in the cash flow hedge reserve, when amending the description of a hedged item in the hedge
documentation, are deemed to be based on the alternative benchmark rate on which the hedged
future cash flows are determined. The amendments will require to disclose additional information
about the entity’s exposure to risks arising from Interest Rate Benchmark Reform and related risk
management activities.
“Amendment to IFRS 16: COVID 19-related rent concessions beyond 30 June 2021”, issued
on 28 May 2020 in order to allow lessees not to account for rent concessions (rent holidays, deferrals
of lease payments, rent reductions for a period, possibly followed by increased rent payments in future
periods) as lease modifications if they are a direct consequence of COVID-19 and meet certain
conditions. According to IFRS 16, a lease modification is a change in the scope or consideration of a
lease that was not part of the original terms and conditions of the lease; therefore, rent concessions
would be lease modifications, unless they were envisaged in the original lease agreement. The
amendment only applies to lessees, while lessors are required to apply the existing requirements of
IFRS 16. The amendment was intended to apply until 30 June 2021, but as the impact of the COVID-
19 pandemic is continuing, on March 31, 2021, the IASB extended the period of application of the
practical expedient to June 30, 2022.
The application of these amendments did not have material impact in the financial statements.
Standards issued but not yet effective
Below is a list of accounting standards, amendments and interpretations that will be effective for the
Company after December 31, 2021:
“Amendments to IAS 1 - Classification of Liabilities as Current or Non-current”, issued in
January 2020. The amendments affect requirements in IAS 1 for the presentation of liabilities. More
in detail, the amendments clarify:
- the criteria for classifying a liability as current or non-current, specifying what is meant by an
entity’s right to defer settlement and that this right must exist at the end of the reporting period;
- that classification is unaffected by management’s intentions or expectations about whether an
entity will exercise its right to defer settlement of a liability;


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- that a right to defer exists only if the entity complies with conditions specified in the loan
agreement at the end of the reporting period, even if the lender does not test compliance until
a later date; and
- that settlement refers to the transfer to the counterparty of cash, equity instruments, other
goods or services.
The amendments will be effective, subject to endorsement, for annual period beginning on or after
January 1, 2023, with earlier application permitted.
“Amendments to IFRS 3 - Reference to the Conceptual Framework”, issued in May 2020. The
amendments are intended to replace a reference to definitions of asset and liability as provided by the
replaced Conceptual Framework for Financial Reporting issued in March 2018 (‘Conceptual
Framework’) without significantly changing its requirements.
The amendments also added to IFRS 3 a requirement that, for transactions and other events within
the scope of IAS 37 Provisions, Contingent Liabilities and Contingent Assets or IFRIC 21 Levies, an
acquirer applies these standards, instead of the Conceptual Framework, to identify the liabilities it has
assumed in a business combination.
Lastly, the amendments clarify existing guidance in IFRS 3 for contingent assets acquired in a business
combination, specifying that, if it is uncertain whether an asset exists at the acquisition date, the
possible asset does not qualify for recognition.
The amendments will be effective for annual periods beginning on or after January 1, 2022.
Amendments to IAS 16 - Property, Plant and Equipment: Proceeds before Intended Use”,
issued in May 2020. The amendments prohibit entities to deduct from the cost of an item of property,
plant and equipment any proceeds received from selling items produced while bringing that asset to
the location and condition necessary for it to be capable of operating in the manner intended by
management. Instead, an entity shall recognize the proceeds from selling such items and the costs of
their production in profit or loss. The amendments will be effective for annual periods beginning on or
after January 1, 2022, with early application permitted.
“Amendments to IAS 37 - Onerous Contracts - Costs of Fulfilling a Contract”, issued in May
2020. The amendments specify which costs an entity includes in determining the cost of fulfilling a
contract for the purpose of assessing whether the contract is onerous. To this end, the “cost of
fulfilling” a contract comprises the costs that relate directly to the contract; they can be either
incremental costs of fulfilling that contract or an allocation of other costs that relate directly to contract
fulfillment. The amendments will be effective for annual periods beginning on or after January 1, 2022,
with early application permitted.
“Annual improvements to IFRS Standards 2018-2020”, issued in May 2020. The document
mainly makes any amendments to:
- “IFRS 1 First-time Adoption of International Financial Reporting Standards”; the amendment
simplifies the application of IFRS 1 for an investee (subsidiary, associates and joint ventures)
that becomes a first-time adopter of IFRSs later than its parent/investor. In particular, if the
investee adopts IFRSs later than its parent/investor and applies IFRS 1.D16(a), then this
investee may elect to measure cumulative translation differences for all foreign operations at
amounts included in the consolidated financial statements of the parent/investor, based on the
parent/investor’s date of transition to IFRSs.


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- “IFRS 9 Financial Instruments”; with reference to the fees included in the ’10 per cent’ test for
the derecognition of financial liabilities, the amendment clarifies the fees that an entity includes
when assessing whether the terms of a new or modified financial liability are substantially
different from the terms of the original financial liability. In particular, these fees include only
those paid or received between the borrower and the lender, including fees paid or received by
either the borrower or lender on the other’s behalf.
“IFRS 16 Leases”; the International Accounting Standards Board amended Illustrative
Example 13 accompanying IFRS 16 Leases. In particular, the amendment removes potential for
confusion in applying IFRS 16 because of the way Illustrative Example 13 had illustrated the
requirements for lease incentives. In fact, the example included a reimbursement for leasehold
improvements without an explanation on whether the reimbursement would meet the definition of a
lease incentive. The amendment removes from the example the illustration of the reimbursement
relating to leasehold improvements.
The amendments shall be applied prospectively for annual reporting periods beginning on or after
January 1, 2022, with early application permitted.
Amendments to IAS 1 and IFRS Practice Statement 2 - Disclosure of Accounting Policies”,
issued in February 2021. The amendments are intended to help entities in deciding which accounting
policies to disclose in their financial statements. The amendments to IAS 1 require entities to disclose
their material accounting policies rather than their significant accounting policies. Guidance on how to
apply the concept of materiality to the accounting policy disclosures is provided by the amendments
to IFRS Practice Statement 2. The amendments, subject to endorsement, are effective for annual
periods beginning on or after January 1, 2023, with early application permitted.
"Amendments to IAS 8 - Definition of Accounting Estimates", issued in February 2021. The
amendments help entities to distinguish between changes in accounting policies from changes in
accounting estimates; the definition of changes in accounting estimates is replaced with a definition
of accounting estimates as “monetary amounts in financial statements that are subject to
measurement uncertainty”. The amendments, subject to endorsement, are effective for annual
periods beginning on or after January 1, 2023, with early application permitted.
Amendments to IAS 12 Income Taxes: Deferred Tax related to Assets and Liabilities arising
from a Single Transaction”, issued in May 2021. The amendments require companies to recognize
deferred tax on transactions that, on initial recognition, give rise to equal amounts of taxable and
deductible temporary differences. The amendments, subject to endorsement, are effective for annual
periods beginning on or after January 1, 2023, with earlier application permitted.
“Amendments to IFRS 10 and IAS 28 - Sale or Contribution of Assets between an Investor
and its Associate or Joint Venture”, issued in September 2014. The amendments clarify the accounting
treatment for sales or contribution of assets between an investor and its associates or joint ventures.
They confirm that the accounting treatment depends on whether the assets sold or contributed to an
associate or joint venture constitute a ‘business’ (as defined in IFRS 3). The IASB has deferred the
effective date of these amendments indefinitely.
“IFRS 17 – Insurance Contracts”, issued in May 2017. The standard will take effect for annual
period beginning on or after January 1, 2023, with earlier application permitted.
The Company is assessing the potential impact of the future application of the new provisions.


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Risk management
Market risk
As part of its operation as a financing company for the Enel Group, Enel Finance International N.V. is
exposed to different market risks, notably interest rate and exchange rates risks. The primary
objective of the Company is to mitigate such risks appropriately so that they do not give rise to
unexpected changes in results.
In order to mitigate this risk, the Company employs financial derivative instruments such as interest
rate swaps, currency forwards and cross currency interest rate swaps, that are negotiated both with
Enel S.p.A. and on the market.
The derivatives compliant with IFRS 9 requirements can be designated as cash flow hedge or fair value
hedge, otherwise are classified as trading.
There we no significant changes in the source of exposure to interest rate and exchange rate risk
compared with the previous year.
Interest rate risk
Interest rate risk is the risk born by an interest-bearing financial instrument due to variability of
interest rates. The optimal debt structure results from the trade-off between reducing the interest rate
exposure and minimizing the average cost of debt.
The Company is exposed to interest rate fluctuation on both liabilities and assets.
Interest rate swaps are stipulated to mitigate the exposure to interest rates fluctuation, thus reducing
the volatility of economic results. Through an interest rate swap, the Company agrees with a
counterparty to exchange, with a specified periodicity, floating rate interest flows versus fixed rate
interest flows, both calculated on a reference notional amount. In order to ensure effectiveness, all
the contracts have notional amount, periodicity and expiry date matching the underlying financial
liability and its expected future cash flows.
The notional amount of outstanding contracts is reported below.
Millions of euro Notional amount
2021
2020
Interest rate derivatives:
Interest rate swap 2,628
2,605
Total 2,628
2,605
For more details, please refer to the note 16 and 17.
At 31 December 2021, 1.35% of gross long term debt towards third parties was floating rate (1.50%
at 31 December 2020). Taking into account interest rate derivatives designated as cash flow hedge
considered effective pursuant to the IFRS EU, gross long term debt is mostly fully hedged against
interest rate risk.
Having both assets and liabilities indexed to floating rate indices, the sensitivity of the Company
income statement to the fluctuation of interest rates depends upon its net long term financial position,
please refer to the sensitivity table.


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Interest rate risk sensitivity analysis
The Company performs sensitivity analysis by estimating the effects of changes in the level of interest
rates on financial instruments portfolio. In particular, sensitivity analysis measures the potential
impact of market scenarios both on equity, for the hedging component of derivatives in cash flow
hedge, and on income statement for all derivatives that do not qualify for hedge accounting and the
portion of net long term floating-rate debt not covered by derivatives. The Company’s assets and
liabilities are accounted for at amortised costs, and not impacted by changes in the level of interest
rates.
These scenarios are represented by parallel translation, measured in basis points (bps) in the interest
rate yield curve at the reporting date. All other variables held constant, the Company’s income and
equity before tax is impacted as follows:
Millions of euro
Interest rate risk sensitivity analysis
2021
Pre-tax impact on income
Pre-tax impact on equity
Interest
Rates
scenario
increase
decrease
increase
decrease
Change in interest expense related to long
term gross floating-rate debt after hedging
25 bp
-
-
-
-
Change in interest expense related to floating-
rate financial receivables after hedging
25 bp
44
(44)
-
-
Change in Fair value of Derivative financial
instruments not qualifying for hedge
accounting
25 bp
-
-
-
-
Change in Fair value of Derivative Financial
instruments designated as hedging
instruments
25 bp
-
-
(1)
1
Millions of euro
Interest rate risk sensitivity analysis
2020
Pre-tax impact on income
Pre-tax impact on equity
Interest
Rates
scenario
increase
decrease
increase
decrease
Change in interest expense related to long
term gross floating-rate debt after hedging
25 bp
-
-
-
-
Change in interest expense related to floating-
rate financial receivables after hedging
25 bp
42
(42)
Change in Fair value of Derivative financial
instruments not qualifying for hedge
accounting
25 bp
-
-
-
-
Change in Fair value of Derivative Financial
instruments designated as hedging
instruments
25 bp
-
-
(2)
2
Exchange rate risk
Exchange rate risk is a type of risk that arises from the change in price of one currency against
another. The Company exposure to such risk is mainly due to foreign currencies denominated flows,
originated by financial assets and liabilities.
In order to mitigate this risk, the Company enters into plain vanilla transactions such as currency
forwards and cross currency interest rate swaps. In order to ensure effectiveness, all the contracts
have notional amount and expiry date matching the underlying expected future cash flows.


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Cross currency interest rate swaps are used to transform a long-term fixed – or floating rate liability
in foreign currency into an equivalent fixed or floating rate liability in euro, while currency forwards
are used to hedge commercial papers and intercompany loans.
Millions of euro Notional amount
2021
2020
Foreign exchange derivatives:
Currency forwards: 2,494
3,738
Cross currency interest rate swaps 15,671
15,992
Total 18,165
19,730
For more details, please refer to the note 16 and 17.
Foreign exchange risk sensitivity analysis
The Company performs sensitivity analysis by estimating the effects on financial instruments portfolio
of changes in the level of exchange rates. In particular, sensitivity analysis measures the potential
impact of market scenarios both on equity, for the hedging component of cash flow hedges derivatives,
and on income statement for those derivatives that do not qualify for hedge accounting and the portion
of gross long-term foreign denominated debt not covered by derivatives.
These scenarios are represented by the 10% Euro appreciation/depreciation towards all foreign
currencies in comparison with end of year level. All other variables held constant, the carrying value
of the Company’s assets and liabilities denominated in foreign currencies are impacted following the
exchange rate scenario disclosed (10%), the Company’s income and equity before tax is impacted as
follows:
Millions of euro
Foreign exchange risk sensitivity analysis
2021
Pre-tax impact on income
Pre-tax impact on equity
Exchange
Rate
Euro Appr.
Euro Depr.
Euro Appr.
Euro Depr.
scenario
Change in Fair value of Derivative financial
instruments not qualifying for hedge
accounting
10%
-
-
-
-
Change in Fair value of Derivative Financial
instruments designated as hedging
instruments
10%
199
(243)
-
-
Cash Flow hedge 10%
-
-
(1,370)
1,675
Fair value hedge 10%
-
-
(54)
66
Millions of euro
Foreign exchange risk sensitivity analysis
2020
Pre-tax impact on income
Pre-tax impact on equity
Exchange
Rate
Euro Appr.
Euro Depr.
Euro Appr.
Euro Depr.
scenario
Change in Fair value of Derivative financial
instruments not qualifying for hedge
accounting
10%
235
(288)
-
-
Change in Fair value of Derivative Financial
instruments designated as hedging
instruments
10%
-
-
-
-
Cash Flow hedge 10%
-
-
(1,972)
2,411


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Credit risk
The Company’s financial operations expose it to credit risk, i.e. the possibility that a deterioration in
the creditworthiness of a counterparty has an adverse impact of the expected value of the creditor
position.
The exposure to credit risk is attributable to Lending and hedging transactions.
Enel Finance International N.V. is part of the centralised financial flow process and acts as the primary
reference for the management of financial needs or liquidity generated by the Enel Group entities. The
Company manages its lending operations in different countries and regions to minimise the
concentration of risks and therefore mitigate financial loss through a counterparty’s potential failure
to make payments.
Finally, with regard to derivative transactions, risk mitigation is pursued with a uniform system for
assessing counterparties, as well as with the adoption of specific risk mitigation clauses (e.g. netting
arrangements) and possibly the exchange of cash collateral.
The Company’s maximum exposure to credit risk for the components of the Balance Sheet at 31
December 2021 and 2020 is the carrying amounts as illustrated in Note 6, 7, 9, 10 and 11.
Credit risk measurement
The Expected Credit Loss (i.e. ECL), determined considering Probability of Default (PD), Loss Given
Default (LGD), and Exposure at Default (EAD), is the difference between all contractual cash flows
that are due in accordance with the contract and all cash flows that are expected to be received (i.e.,
all short falls) discounted at the original EIR.
EAD is established on a quarterly basis using outstanding exposure data. PD and LGD are determined
at least annually.
Probability of Default (PD) indicates the likelihood that a counterparty will default within one-year time
horizon.
The Company defines a default to have occurred when:
the counterparty is overdue by more then 90 days; or
the Company considers the borrower to be unlikely to meet its contractual obligations;
besides mandatory triggers, judgmental triggers also apply.
The PD is estimated mainly in relation to the creditworthiness of each counterparty. The Company
computes the PD as the average of the P provided by the major rating agencies (e.g. Standard &
Poor’s, Moody’s) for each credit score, updated on yearly basis. Internal methodology to assess the
creditworthiness considers qualitative and quantitative information (including the market data from
rating agencies) in order to reflect possible future events and macroeconomic scenarios, which may
affect the risk of the portfolio or the financial instrument.


Graphics
43
Rating Moody's PD % Standard&Poors PD% PD%
Aaa/AAA -
-
-
Aa1/AA+ -
-
-
Aa2/AA -
0.02
0.01
Aa3/AA- 0.04
0.03
0.04
A1/A+ 0.06
0.05
0.06
A2/A 0.04
0.05
0.05
A3/A- 0.05
0.06
0.06
Baa1/BBB+ 0.11
0.09
0.10
Baa2/BBB 0.14
0.15
0.15
Baa3/BBB- 0.23
0.24
0.24
Ba1/BB+ 0.42
0.32
0.37
Ba2/BB 0.68
0.48
0.58
Ba3/BB- 1.29
0.96
1.13
B1/B+ 1.93
1.98
1.96
B2/B 2.98
3.13
3.06
B3/B- 4.64
6.52
5.58
Caa 7.81
7.81
Exposure at Default (EAD) estimates the carrying exposure at the reporting date net of of eventual
cash deposits obtained as guarantees.
Loss Given Default (LGD) consider each specific exposure at default, date of default, guarantee and
deposit information, recovery rate (portfolio or benchmark), credit insurance and legal/post default
classification details.
The Company uses qualitative triggers to determine whether a financial instrument should be classified
as stage 1 (i.e. Performing) or stage 2 (i.e. Underperforming). The Company is monitoring the status
of borrower and the instruments is transferred from stage 1 to stage 2 if the credit risk increases and
there is a significant past due. A transfer to stage 3 (i.e. Non-performing) will always be the result of
default of the financial instrument.
The following table provides information about the exposure to credit risk and ECL, measured on an
individual basis, for financial assets subject to impairment:
Millions of euro
at Dec. 31,
2021
Staging
Basis for
recognition of
expected credit
loss provision
Weighted
average
expected credit
loss rate
(PD*LGD)
Gross carrying
amount
Expected credit
loss allowance
Net amount
Performing 12 m ECL 0.11%
47,747
(54)
47,693
Underperforming Lifetime ECL -
-
-
-
Non-performing Lifetime ECL -
-
-
-
Total
47,747
(54)
47,693


Graphics
44
The table below reports the movement in expected credit loss that has been recognized for financial
assets measured at amortized cost
Millions of euro
2021
2020
Change
Expected credit loss allowance as at 1 January (38)
(52)
14
Impairment losses recognized in profit or loss (24)
(16)
(8)
Reversal of impairment losses in profit or loss 10
28
(18)
Exchange rate differences (2)
2
(4)
Expected credit loss allowance as at 31 December (54)
(38)
(16)
Liquidity risk
Liquidity risk manifests itself as uncertainty about the Company’s ability to discharge its obligations
associated with financial liabilities that are settled by delivering cash or another financial asset.
The Company manages liquidity risk by implementing measures to ensure an appropriate level of
liquid financial resources minimizing the associated opportunity cost and maintaining debt structure
balanced in terms of its maturity profile and funding sources.
On short term, liquidity risk is mitigated by maintaining an appropriate level of unconditionally
available resources.
On long term, liquidity risk is mitigated by maintaining a debt maturity profile for our debt allowing
access to a range of resources of funding on different markets, in different currencies and with different
counterparties.
The mitigation of liquidity risk enables the Company to maintain a credit rating that ensures access
to the capital market and limits the cost of funds, with a positive impact on its performance and
financial position.
The Company holds the following undrawn lines of credit
Millions of euro
at Dec. 31,
2021
at Dec. 31,
2020
Expiring
within one
year
Expiring
beyond one
year
Expiring within
one year
Expiring beyond
one year
Committed credit lines
3,000
5,000
Commercial paper
916
3,261
Total
916
3,000
3,261
5,000
Millions of euro
at Dec. 31,
2020
Staging
Basis for
recognition of
expected credit
loss provision
Weighted
average expected
credit loss rate
(PD*LGD)
Gross carrying
amount
Expected credit
loss allowance
Net amount
Performing 12 m ECL 0.11%
34,892
(38)
34,854
Underperforming
Lifetime ECL -
-
-
-
Non-performing Lifetime ECL -
-
-
-
Total
34,892
(38)
34,854


Graphics
45
Sustainability-linked revolving credit facility in the amount of Euro 10 billion, with a term of five years
is available for both the Company and Enel S.pA. Enel S.p.A has draw down Euro 1 bln by the end of
2021.
Furthermore, Enel S.p.A. has confirmed through a letter dated January 2021 its commitment to
explicitly provide the Company with the financial support until the date of approval of full year 2021
financial statements of the Company.
Maturity analysis
The table below summarizes the maturity profile of the Company’s long-term debt on contractual
undiscounted payments.
Maturing in
Millions of Euro 2022
2023
2024
2025
2026
Beyond
Bond
Listed Bond (Fixed rate) 2,394
1,234
3,784
2,399
3,573
11,419
Listed Bond (Floating rate) 168
161
106
51
-
-
Unlisted Bond (Fixed rate) 465
413
1,737
377
1,481
12,526
Total Bond 3,027
1,808
5,627
2,828
5,054
23,945


Graphics
46
Notes to the financial statements
1 Interest income/ (expense) – Euro (1,096) million
Millions of euro
2021
2020
Change
Interest income:
- interest income on long-term financial assets 667
702
(35)
- interest income on short-term financial assets 30
57
(27)
- interest income from derivatives 321
326
(5)
- interest income from cash collaterals (6)
(2)
(4)
- other income 0
710
(710)
Total interest income 1,012
1,793
(781)
Interest expense:
- interest expense on borrowings (19)
(15)
(4)
- interest expense on bonds (1,218)
(1,147)
(71)
- interest expense on commercial papers 12
4
8
- interest expense from derivatives (192)
(233)
41
- interest expense from cash collaterals 0
3
(3)
- guarantee fee (57)
(57)
0
- other expense (634)
(4)
(630)
Total interest expense (2,108)
(1,449)
(659)
Net interest income/ (expense) (1,096)
344
(1,440)
Interest income from assets amounted to Euro 1,012 million on 31 December 2021, having a
decrease of Euro 781 million on 31 December 2020 with the variation mainly attributed to:
- the prior year transfer of long-term loans granted to E-Distribuzione S.p.A, Enel Produzione S.p.A
to Enel Italia S.p.A. (Euro 710 million);
- lower interest income from Enel subsidiaries and affiliates incorporated mainly in Italy (Euro 84
million), in Spain (Euro 27 million), in the Netherlands (Euro 21 million), in Mexico (Euro 12
million) and in Costa Rica (7 million);
- decrease of interest income from derivatives (Euro 5 million);
- decrease of interest income from cash collaterals (Euro 4 million)
This decrease was partly offset by higher interest income from Enel subsidiaries and affiliates
incorporated mainly in Norway (Euro 31 million), in Greece (Euro 23 million), in Brazil (Euro 15
million), in Chile (Euro 8 million), in Colombia (Euro 7 million), in Germany (Euro 5 million).
Interests expenses on financial debt totaled Euro 2,108 million increased by Euro 659 million mainly
due to:
- the interest expenses on the cash consideration paid in connection with early redemption of USD
and Euro bonds and other expenses associated to these transactions (Euro 634 million);
- an increase of interest expenses attributed to bond issuance made in 2021 and 2020 (Euro 56
million);
- higher interest expenses due to exchange rate differences (Euro 18 million);
- increase of amortised costs release to profit and loss for repurchased bonds (Euro 119 million)


Graphics
47
- increase of interest expenses for floating rate bonds (Euro 5 million).
- higher interests paid to Group companies (Euro 4 million) mainly to Enel S.p.A. as a result of
negative interests charged on financial service agreement
- increase of interest expense from cash collaterals (Euro 3 million)
This decrease was partly offset by:
- decrease of interest attributed to the bonds repaid in 2021 and 2020 (Euro 127 million);
- decrease of interest expense from derivatives (Euro 41 million);
- negative interest charges received from the Commercial Paper (Euro 8 million);
- prior year transfer of long-term loan granted to Enel Sole to Enel Italia S.p.A. (Euro 4 million);
2. Other operating expense – Euro (5) million
Other operating expense totaled to Euro 5 million remain unchanged in respect to the previous year
and refer to services (mainly related to legal and consultancy charges) for Euro 4 million, to personnel
costs for Euro 0,8 million and social security charges Euro 0,1 million.
At 31 December 2021 the Company had, other than the directors, eleven employees (eleven people
at 31 December 2020). Average headcount comprised ten people (ten people for the 2020).
3. Financial income/(expense) Euro (186 million
3.1 Financial income/(expense) from derivatives
Millions of euro
2021
2020
Change
Financial income from derivatives:
- income from cash flow hedge derivatives 1,389
305
1,084
- income from fair value hedge derivatives 44
10
34
- income from derivatives at fair value through profit or loss 267
371
(104)
Total finance income from derivatives 1,700
360
1,340
Financial expense from derivatives:
- expenses from cash flow hedge derivatives (104)
(1,346)
1,242
- expenses from fair value hedge derivatives (1)
-
(1)
- expenses from derivatives at fair value through profit or loss (414)
(137)
(277)
Total financial expense from derivatives (519)
(1,483)
964
Net income/(expense) from derivatives 1,181
(1,123)
2,304
Net financial expense from derivatives totaled to Euro 1,181 million and essentially reflected net
financial income from cash flow derivatives (Euro 1,285 million), net financial expenses from
derivatives at fair value through profit and loss (Euro 147 million) and income from fair value hedge
derivatives (Euro 43 million).
The deterioration of Euro 2,304 million compared with the previous year was due to increase in net
financial income from cash flow hedge derivatives (Euro 2,619 million) and increase of financial income
from fair value hedge derivatives (Euro 33 million) partly offset by increase of net financial expenses
from derivatives at fair value though profit and loss (Euro 348 million).
The net balance recognized in 2021 on both hedging and trading derivatives mainly reflected the
hedging of currency risk.


Graphics
48
For more detail about derivative financial instruments, please refer to the note 16 and 17.
3.2 Other net financial income/ (expense)
Millions of euro
2021
2020
Change
Other financial income
- positive exchange rate differences 299
1,412
(1,113)
-reversal of impairment -
12
(12)
Total other financial income 299
1,424
(1,125)
Other financial expenses
-negative exchange rate differences (1,280)
(345)
(935)
-impairment (14)
-
(14)
Total other financial expense (1,294)
(345)
(949)
Net other financial income/ (expense) (995)
1,079
(2,074)
Net other financial expenses totaled to Euro 995 million composed to net exchange rate differences
(Euro 981 million) and impairment (Euro14 million).
Net foreign exchange loss totaled to Euro 981 million consisted of: the negative revaluation of the
outstanding value of bonds denominated in foreign currencies (Euro 1,241 million), positive foreign
currency evaluation of non-euro group portfolio (Euro 240 million) and other foreign exchange gain
(Euro 20 million).
The amount of the foreign exchange losses arisen from the remeasuring of notional amount of bonds
(Euro 919 million) and the amount of forex exchange gains arisen from several BRL and USD loans
(Euro 72 million) are mitigated by the same amount recycled to the Cash Flow Hedge equity reserve.
The following table shows impairment losses recognized and reversed during the period.
Millions of euro
2021
2020
Change
Expected credit losses:
Long-term loans and financial receivables (including current portion) (21)
(14)
(7)
Short-term loans and financial receivables (3)
(2)
(1)
Total expected credit losses (24)
(16)
(8)
Reversals of impairment losses:
Long-term loans and financial receivables (including current portion) 9
17
(8)
Short-term loans and financial receivables 1
11
(10)
Total reversals of expected credit losses 10
28
(18)
Total expected credit losses/ (reversal of expected credit losses) (14)
12
(26)
Reversal of impairment is mainly attributed to the repayment of long-term loans and change in
structure of short-term revolving credit lines and loans granted to the Enel Group Companies.
4 Income tax (income)/expenses – Euro ( 175 )million
Millions of euro
2021
2020
Change
Profit before income taxes (915)
295
(1,210)
Withholding tax on foreign interests 12
11
1
Tax charge (7)
61
(68)
Deferred tax assets (180)
6
(186)
Income taxes (175)
78
(253)
Effective tax rate 19%
26%


Graphics
49
The following table reconciles the theoretical tax rate with the effective tax rate.
Millions of euro
2021
2020
Change
Accounting profit before income tax (915)
295
(1,210)
Tax rate applicable 25%
25%
0
Theoretical tax expense (229)
74
(303)
Permanent differences 49
Adjustments in respect of current income tax of previous years (4)
(4)
0
Withholding tax deduction (3)
(3)
0
Whithholding tax paid abroad 12
11
1
Impact on deferred taxation of changes in tax rates 1
11
(10)
Tax charge (175)
78
(253)
The Company has concluded a ruling with the taxation authority that covers the period January 1,
2017 until December 31, 2021. Having considered the results of the years under this agreement an
adjustment was deemed necessary and a permanent difference arose. The Company has historically
had an open collaboration with the taxation authority and is currently having conversations on the
applicability of the ruling (which conversation can be concluded when the 2021 tax return will be filed).
5 Deferred tax assets (liabilities) – Euro 356 million
Changes in deferred tax assets and deferred tax liabilities, grouped by type of temporary difference, are shown below.
Deferred tax assets have not been recognized in respect of the following items, because it is not
probable that future taxable profit will be available against which the Company can use the benefits
therefrom
Millions of euro
2021 2020
Gross
amount
Tax effect
Gross
amount
Tax effect
- deductible temporary difference taken to equity
-
-
1,103
276
- deductible temporary difference taken to income statement
-
-
7
2
Total unrecognised deferred tax assets
-
278
Millions of euro
at
Dec.
31,
2020
Increase/
(Decrease
) taken to
income
statement
Increase/
(Decrease
) taken to
equity
Impact of
tax rate
decrease ta
ken to
income
statemen
Impact
of tax
rate
decrease
taken to
equity
(De)recognitio
n
at
Dec.
31,
202
1
Deferred tax asset
Nature of temporary differences:
- derivatives
-
-
171
-
5
-
176
- losses with deferred deductibility
-
172
5
-
177
- measurement of financial instruments
-
19
-
-
-
-
19
Deferred tax asset
-
191
171
5
5
-
372
Deferred tax liability
Nature of temporary differences:
- measurement of financial instruments
-
(15)
-
(1)
-
-
(16)
Total deferred tax liabilities
(15)
-
(1)
-
-
(16)
Net deferred tax asset
-
176
171
4
5
-
356


Graphics
50
6 Long-term loans and financial receivables including portion falling due
within twelve month Euro 40,745 million
Following table represents medium long-term loans granted to the Enel Group companies and affiliated
companies:
Millions of Euro
at Dec.
31,
2021
at Dec. 31,
2020
Change
Long-term loans
Loan receivable from Enel S.p.A. 18,739
11,156
7,583
Loan receivable from Enel Italia S.p.A. 8,750
8,750
-
Loan receivable from Endesa SA 3,000
3,000
-
Loan receivable from Enel Iberia Srl 3,354
3,704
(350)
Loan receivable from Enel Green Power S.p.A. 1,670
1,755
(85)
Loan receivable from Enel Chile SA 1,363
815
548
Loan receivable from Enel Green Power del Sur SpA (Parque Eólico Renaico
SpA)
-
525
(525)
Loan receivable from Slovak Power Holding BV 656
453
203
Loan receivable from Enel Green Power México S de RL de Cv 237
231
6
Loan receivable from Enel Global Trading S.p.A. 200
200
-
Loan receivable from Enel Green Power Hellas SA 167
168
(1)
Loan receivable from Energía Limpia de Palo Alto S de RL de Cv 120
119
1
Loan receivable from Ampla Energia E Serviços S.A. 400
118
282
Loan receivable from Energia Limpia de Amistad S de RL de CV 85
78
7
Loan receivable from PH Chucas SA 50
70
(20)
Loan receivable from Energías Renovables La Mata SAPI de Cv -
75
(75)
Loan receivable from EGP Magdalena Solar SA DE CV 69
69
-
Loan receivables from EPM Eolica Dolores SA DE CV 69
69
-
Loan receivable from Parque Salitrillos SA de Cv 64
64
-
Loan receivable from Dominica Energía Limpia S de RL de Cv 45
41
4
Loan receivable from Villanueva Solar SA de CV 46
39
7
Loan receivables from Parque Amistad II SA DE CV 32
32
-
Loan receivable from Enel Green Power Panama SA 31
32
(1)
Loan receivables from Parque Amistad III SA DE CV 31
31
-
Loan receivable from Vientos del Altiplano S de RL de Cv 27
26
1
Loan receivable from Parque Solar Villanueva Tres SA de CV 31
26
5
Loan receivables from COHUNA SOLAR FARM Trust 27
24
3
Loan receivable from Parque Solar Don Jose SA de CV 18
16
2
Loan receivable from Enel X Korea Ltd 5
5
-
Loan receivables from NGONYE POWER COMPANY Ltd 3
2
1
Loan receivable from Viva Labs AS 3
2
1
Loan receivable from Enel X Polska Sp. Zo.O. -
1
(1)
Loan receivable from Celg Distribuicao S.A. Celg D. 362
-
362
Loan receivable from Companhia Energetica Do Ceara - Coelce 79
-
79
Loan receivables from Enel X S.r.l. 100
-
100
Total loans 39,833
31,696
8,137
Expected credit loss
(46)
(34)
(12)
Total loans net of expected credit loss 39,787
31,662
8,125


Graphics
51
Short-term portion of long-term loans represented in the table below:
Millions of euro
at Dec.
31,
2021
at Dec. 31,
2020
Change
Short
-
term portion of long
-
term loans
Loan receivable from EPM Eolica Dolores SA DE CV 6
-
6
Loan receivable from Enel Iberia Srl 350
350
-
Loan receivable from Enel Green Power S.p.A. 85
77
8
Loan receivable from Enel S.p.A. 117
46
71
Loan receivable from PH Chucas SA 12
11
1
Loan receivable from Enel Green Power México S de RL de Cv 9
4
5
Loan receivable from Energías Renovables La Mata SAPI de Cv -
8
(8)
Loan receivable from Energía Limpia de Palo Alto S de RL de Cv 9
7
2
Loan receivable from Enel Green Power Panama SA 3
4
(1)
Loan receivable from Enel Chile SA 353
-
353
Loan receivables from COHUNA SOLAR FARM Trust 1
3
(2)
Loan receivable from Parque Salitrillos SA de Cv 2
3
(1)
Loan receivable from Enel Green Power Hellas SA 1
2
(1)
Loan receivable from EGP Magdalena Solar SA DE CV 6
-
6
Loan receivables from Parque Amistad II SA DE CV 3
-
3
Loan receivables from Parque Amistad III SA DE CV 2
-
2
Total 959
515
444
Expected credit loss
(1)
-
(1)
Total loans net of expected credit loss 958
515
443
The table below reports long-term financial receivables by currency and interest rate.
Millions of Euro
at Dec. 31,
2021
at Dec. 31,
2021
at Dec. 31,
2020
Balance
Nominal value
Balance
Effective interest
rate
Total Euro 37,635
37,635
29,665
1.56%
Australian Dollar 27
27
26
2.86%
Brazilian Real 401
401
118
10.30%
Mexican Peso 158
158
150
12.45%
Norwegian Krone 3
3
2
4.25%
Polish zloty
-
-
1
US dollar 2,565
2,566
2,247
3.28%
Zambian Kwacha 3
3
2
25.90%
Total non-Euro currencies 3,157
3,158
2,546
Total 40,792
40,793
32,211
7. Derivatives – Euro 176 million
Derivative instruments refer to: (i) Cash flow hedge derivatives used by the Company to hedge the
exchange rate and interest rate fluctuations of bonds and long-term loans or receivables; (ii)
derivatives at fair value through profit and loss used by the Company to mitigate the loan interest
rate fluctuations and (iii) fair value hedge derivative on exchange rate risk.
Millions of euro Non Current Current
at Dec. 31,
2021
at Dec. 31,
2020
at Dec. 31,
2021
at Dec. 31,
2020
Derivative financial assets 671
144
3
54
Derivative financial liabilities (473)
(1,539)
(25)
(4)


Graphics
52
For more details about the nature, the recognition and classification of derivative financial assets
and liabilities, please refer to the note 17.
8 Other non-current financial assets – Euro 38 million
Other non-current financial assets totaled Euro 38 million as at 31 December 2021 (Euro 37 million
as at 31 December 2020) are essentially accounted for by transaction costs on Euro 10 billion revolving
credit facility agreed on 5 March 2021 between Enel SpA, Enel Finance International N.V. and
Mediobanca and prepaid expenses of derivative agreements.
9 Short-term loans and financial receivables – Euro 6,947 million
The following table shows the breakdown of the short-term loans granted to the Enel Group companies
and affiliated companies:
Millions of euro
at Dec.
31,
2021
at Dec.
31,
2020
Change
Short-term loans
Enel S.p.A. - Financial Services Agreement 5,310
2,275
3,035
Revolving short-term facility agreement with Enel Green Power Hellas Sa 147
152
(5)
Revolving short-term facility agreement with Enel Americas SA -
122
(122)
Revolving short-term facility agreement with Enel Green Power México S de RL de
Cv
71
37
34
Revolving short-term facility agreement with Enel Green Power RSA 38
16
22
Revolving short-term facility agreement with Enel Rinnovabile,S.A. de C.V. 17
16
1
Revolving short-term facility agreement with EPM Eolica Dolores SA DE CV 29
16
13
Revolving short-term facility agreement with PARQUE AMISTAD IV SA 32
12
20
Revolving short-term facility agreement with EGP Magdalena Solar SA DE CV 19
8
11
Revolving short-term facility agreement with PARQUE AMISTAD II SA 16
8
8
Revolving short-term facility agreement with PARQUE AMISTAD III SA 24
7
17
Revolving short-term facility agreement with PH Chucas SA -
6
(6)
Revolving short-term facility agreement with Parque Eolico Pampa Sa -
4
(4)
Revolving short-term facility agreement with Enel Green Power Bulgaria EAD -
2
(2)
Revolving short-term facility agreement with Ampla Energia E Serviços S.A. 160
-
160
Revolving short-term facility agreement with Juicenet Gmbh 2
-
2
Revolving short-term facility agreement with Enel Green Power Perú SA 5
-
5
Revolving short-term facility agreement with Enel Chile SA 477
-
477
Revolving short-term facility agreement with Enel Global Trading Spa IT 600
-
600
Revolving short-term facility agreement with Enel Trade Energy SRL 4
-
4
Revolving short-term facility agreement with Enel X Japan K.K. 1
-
1
Revolving short-term facility agreement with Enel X Norway AS 1
-
1
Total short term loans 6,953
2,681
4,272
Expected credit loss
(6)
(4)
(2)
Total loans net of expected credit loss 6,947
2,677
4,270


Graphics
53
Millions of Euro
at Dec. 31,
2021
at Dec. 31,
2021
at Dec. 31,
2020
Balance
Nominal value
Balance
Effective interest
rate
Total Euro 6,219
6,219
2,429
0.16%
US dollar 690
690
236
2.18%
Japanese yen
1
1
-
-
Norwegian Krone
1
1
-
-
South African rand 38
38
16
6.20%
Romanian leu
4
4
-
4.19%
Total non-Euro currencies 734
734
252
-
Total 6,953
6,953
2,681
The table below reports the short-term financial instruments granted to the Enel Group companies:
Facility Agreements denominated in
Millions of Euro
Financial
relationship
Commitm
ent
amount
as at 31
Dec 2021
Rate of
Interest
Spre
ad as
at 31
Dec
2021
Commitment
fee as at 31
Dec 2021
Enel Green Power Hellas SA
Revolving credit
facility
22.60
EUR
EURIBOR
3M
1.60%
35% of the
margin
Enel Green Power Hellas SA
Revolving credit
facility
2.15
EUR EURIBOR
3M
1.60%
35% of the
margin
Enel Green Power Hellas SA
Revolving credit
facility
5.05
EUR EURIBOR
3M
1.60%
35% of the
margin
Enel Green Power Hellas SA
Revolving credit
facility
34.40
EUR EURIBOR
3M
1.60%
35% of the
margin
Enel Green Power Hellas SA
Revolving credit
facility
15.45
EUR EURIBOR
3M
1.60%
35% of the
margin
Enel Green Power Hellas SA
Revolving credit
facility
2.90
EUR EURIBOR
3M
1.60%
35% of the
margin
Enel Green Power Hellas SA
Revolving credit
facility
5.80
EUR EURIBOR
3M
1.60%
35% of the
margin
Enel Green Power Hellas SA
Revolving credit
facility
38.90
EUR EURIBOR
3M
1.60%
35% of the
margin
Enel Green Power Hellas SA
Revolving credit
facility
19.40
EUR EURIBOR
3M
1.60%
35% of the
margin
Endesa SA
Revolving credit
facility
1,700.00
EUR EURIBOR
0.65%
0.20%
Enel Global Trading SPA
Revolving credit
facility
600.00
EUR EURIBOR
0.80%
35% of the
margin
JuiceNet GmbH
Revolving credit
facility
2.50
EUR EURIBOR
3M
1.20%
35% of the
margin
Enel X Taiwan Co.,Ltd.
Revolving credit
facility
0.20
EUR EURIBOR
3M
1.15%
35% of the
margin
Enel SpA Loan 1,500.00
Fixed 1.15%
0.00345
Millions of USD
Enel Americas S.A.
Revolving credit
facility
500.00
US LIBOR 1.07%
35% of the
margin
Parque Amistad IV SA DE CV
Revolving credit
facility
55.00
US LIBOR 3.50%
35% of the
margin
Parque Amistad II SA DE CV
Revolving credit
facility
35.00
US LIBOR 3M 1.50%
35% of the
margin
Parque Amistad III SA DE CV
Revolving credit
facility
35.00
US LIBOR 3M 1.50%
35% of the
margin
EPM Eolica Dolores SA DE CV
Revolving credit
facility
50.00
US LIBOR 3M 1.50%
35% of the
margin
EGP Magdalena Solar S.A de C.V
Revolving credit
facility
25.00
US LIBOR 3M 1.50%
35% of the
margin
Enel Green Power Mexico S.A.
Revolving credit
facility
45.00
US LIBOR 2.90%
35% of the
margin
Enel Green Power Mexico S.A.
Revolving credit
facility
35.00
US LIBOR 3M 3.20%
35% of the
margin
Enel Rinnovable SA DE CV
Revolving credit
facility
20.00
US LIBOR 3M 4.00%
35% of the
margin
Enel Green Power Peru S.A.
Revolving credit
facility
30.00
US LIBOR 3M 0.90%
35% of the
margin
Enel Chile S.A.
Revolving credit
facility
290.00
US LIBOR 1.00%
35% of the
margin
Enel Chile S.A.
Revolving credit
facility
200.00
US LIBOR 1.15%
30% of the
margin
Enel Chile S.A.
Revolving credit
facility
50.00
US LIBOR 0.90%
0.25% of the
margin
Enel Green Power Mexico Loan 155.00
US LIBOR 6M 3.75%
35% othe
margin


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54
Millions of GBP
JuiceNet Ltd
Revolving credit
facility
0.105
BP 3M 1.15%
35% of the
margin
Millions of JPY
Enel x Japan
Revolving credit
facility
135.00
JPY 3M 1.50%
35% of the
margin
Enel x Japan
Revolving credit
facility
42.00
JPY 3M 1.15%
35% of the
margin
Millions of NOK
Enel X Norway
Revolving credit
facility
11.00
NIBOR 3M 2.60%
35% of the
margin
Viva Labs AS Loan 50.00
NIBOR 6M 3.35%
35% of the
margin
Millions of PLN
Enel X Polska
Revolving credit
facility
2.50
WIBR 3M 1.50%
35% of the
margin
Millions of RON
ENEL TRADE ENERGY
Revolving credit
facility
77.00
BUBR 3M 2.15%
35% othe
margin
ENEL X ROMANIA
Revolving credit
facility
4.80
BUBR 3M 1.80%
35% othe
margin
ENEL X MOBILITY ROMANIA
Revolving credit
facility
2.40
BUBR 3M 1.80%
35% othe
margin
Millions of ZAR
EGP RSA PTY LTD
Revolving credit
facility
1,000.00
Fixed
0.90%
10 Other current financial assets – Euro 662 million
Millions of euro
at Dec.
31,
2021
at Dec. 31,
2020
Change
Cash collateral on derivatives 450
1,396
(946)
Current financial accrued income 212
183
29
Total other current financial assets 662
1,579
(917)
While other current financial assets are also subject to the impairment requirements of IFRS 9, the
identified impairment loss was immaterial.
11 Cash and cash equivalents – Euro 218 million
Cash and cash equivalent represent the cash availability deriving by the turnover of the lending
portfolio of the Company, temporary not invested in lending activities within the Enel Group and placed
in time deposits operations with primary bank counterparties.
While cash and cash equivalents are also subject to the impairment requirements of IFRS 9, the
identified impairment loss was immaterial.
Cash balances are mostly denominated in euro. Cash balances are not restricted by any
encumbrances.
12 Shareholder’s equity – Euro 10,064 million
Share capital – Euro 1,479 million
The authorized share capital of the company amounts to Euro 2,500 million, divided into 2,500 million
of shares, each share with a nominal value of Euro 1.0 each.
The issued and paid-up share capital amounts to Euro 1,478.8 million represented by 1,478,810,371
shares with nominal value of Euro 1.0 each increased by 1 share as a result of demerger in 2016 of
Enel Green Power International B.V.


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55
Share premium reserve– Euro 9,126 million
The reserve arises from the cross-border merger finalized during 2010 between Enel Finance
International S.A. and Enel Trading RUS B.V. (Euro 43 million), demerger of net assets from Enel
Green Power International B.V. in October 2016 (Euro 983 million) and capital contribution (Euro
8,100 million) made by parent companies in October 2021.
Legal reserves include reserves such as reserve from effective portion of change in the fair value of
cash flow hedges and reserve from cost of hedging.
Reserve from effective portion of change in the fair value of cash flow hedges (legal reserve) – Euro
(508) million
The reserve includes the effective portion of the cumulative net change in the fair value of cash flow
hedging instruments related to hedged transactions.
Considering the nature of the reserve (legal), up to the amount of the negative balance of this reserve,
no distributions may be charged to the free reserves.
For more details about the nature, the recognition and classification of derivative financial assets and
liabilities, please refer to the note 17.
Reserve from cost of hedging (legal reserve) – Euro 2 million
This reserve includes net gains (losses) recognised directly in equity resulting from the measurement
of fair value cost of hedging (i.e. time value, forward element and currency basis) when excluded from
hedging relationship.
Considering the nature of the reserve (legal), up to the amount of the negative balance of this reserve,
no distributions may be charged to the free reserves.
For more details please refer to the note 17.
Capital Management
It is the policy of the Company to maintain a strong capital base to preserve creditors and market
confidence and so to sustain future development of the business. The Board of Directors monitors the
return on capital that the Company defines as total shareholder’s equity, the developments in the
level of its debt in relation to equity and the level of dividends to ordinary shareholders.
The return of capital is calculated as a percentage of financial result on total equity net of cash flow
hedge reserve excluded in this key performance indicator because Company’s management preferred
to exclude evaluation equity reserves which might be quite volatile over the periods:
Millions of euro
at Dec. 31,
2021
at Dec. 31,
2020
Total Equity
10,064
2,116
Cash flow hedge and cost of hedging reserves
(506)
(1,094)
Adjusted equity
10,570
3,210
Net financial result
(740)
217
Return of capital (*)
-7%
7%
* Key Performance Indicator determined on a yearly basis.
The Board’s objective is to maintain a balance between the higher returns that might be possible with
higher levels of borrowings and the advantages and security afforded by a sound capital position.


Graphics
56
The developments in the level of its debt in relation to equity is summarised in the following table.
Millions of euro
at Dec. 31,
2021
at Dec. 31,
2020
Non-current financial debt
30,721
28,858
Net current financial position
(585)
(922)
Non-current financial receivables and long-term securities
(39,787)
(31,662)
Net financial debt
(9,651)
(3,726)
Shareholders’ equity
10,064
2,116
Debt/Equity ratio
(0.96)
(1.76)
There were no changes in the Company’s approach to capital management during 2021. The Company
is not subject to externally imposed capital requirements.
Proposal for net result appropriation
The Board of Directors proposes to the General meeting of Shareholders the allocation of the net result
of the year 2021 to the Company’s retained earnings/ (accumulated loss).
13 Long-term loans and borrowings (including the portion falling due within
twelve months for Euro 2,146 million) – Euro 32,867 million
This note provides information about the contractual terms of the Company’s interest bearing loans
and borrowings, which are measured at amortized cost. For more information about the Company’s
exposure to interest rate, foreign currency and liquidity risk, see paragraph “Risk management”.
The aggregate includes long-term payables in respect of bonds, bank loans, revolving credit facility
and other loans in Euro and other currencies.
The following table shows the nominal values, carrying amounts of long-term debt at 31 December
2021, including the portion falling due within 12 months, grouped by type of borrowing and type of
interest rate:
Millions of Euro
Balance
Nominal
value
Portion
falling due
after more
than 12
months
Current
portion
Balance
Nominal
value
Portion
falling due
after more
than 12
months
Current
portion
at Dec.
31,
2021
at Dec.
31,
2021
at Dec.
31,
2021
at Dec.
31,
2021
at Dec.
31,
2020
at Dec.
31,
2020
at Dec.
31,
2020
at Dec.
31,
2020
Bond
Listed Bond (Fixed rate) 21,211
21,604
19,264
1,947
15,757
16,229
15,225
532
Listed Bond (Floating
rate)
449
450
300
149
448
450
448
-
Unlisted Bond (Fixed
rate)
11,207
11,293
11,157
50
13,185
13,262
13,185
-
Total Bond 32,867
33,347
30,721
2,146
29,390
29,941
28,858
532


Graphics
57
The table below reports long-term financial debt by currency and interest rate.
Millions of Euro
at Dec. 31,
2021
at Dec. 31,
2021
at Dec. 31,
2020
at Dec. 31,
2021
Balance
Nominal value
Balance
Current average
interest rate
Effective
interest rate
Total Euro 18,332
18,668
13,060
1.68%
2.11%
US dollar 10,982
11,061
12,971
3.73%
3.89%
British pound 3,210
3,274
3,031
4.85%
5.00%
Swiss Franc 343
344
328
1.81%
1.84%
Total non-Euro currencies 14,535
14,679
16,330
Total 32,867
33,347
29,390
The table below reports changes in the nominal value of long-term debt during the year.
Millions of Euro
Nominal value
New
financing
Capitalised
interests
on ZCB
Repayments
Exchange
rate
differences
Nominal
value
at Dec. 31,
2020
at Dec.
31,
2021
Bonds in non-Euro
currencies and Euro
currency
29,941
10,130
10
(7,978)
1,244
33,347
Total long-term financial
debt
29,941
10,130
10
(7,978)
1,244
33,347
Global Medium Term Programme
Bond issue
In 2021 the Company executed several liability management transactions which together with new
issuance will improve the long-term debt structure in terms of composition, maturity profile and
economic conditions and further accelerate the achievement of the Enel targets of sustainable finance
sources.
A triple-tranche Euro 3.25 billion sustainability-linked bond in the eurobond market
On 8 June 2021 the Company placed a triple-tranche Euro 3.25 billion Sustainability-Linked bond,
linked to the achievement of Enel’s sustainable objective related to the reduction of Direct Greenhouse
Gas Emissions, contributing to the United Nations Sustainable Development Goal 13 and in line with
the Enel Group’s Sustainability-Linked Financing Framework.
The issue is structured in the following three tranches:
- Euro 1 billion at a fixed rate of 0.000%, with settlement date set on 17 June 2021, maturing
17 June 2027:
the issue price was set at 98.909% and the effective yield at maturity is equal to 0.183%;
the interest rate will remain unchanged to maturity, subject to achievement of a Sustainability
Performance Target (SPT) equal to or lower than 148gCO2eq/kWh as of 31 December 2023;


Graphics
58
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-
party expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology
for measuring CO2eq emissions applied by the Enel Group;
- Euro 1.25 billion at a fixed rate of 0.500%, with settlement date set on 17 June 2021, maturing
17 June 2030:
the issue price was set at 99.728% and the effective yield at maturity is equal to 0.531%;
the interest rate will remain unchanged to maturity, subject to achievement of a SPT equal to
or lower than 148gCO2eq/kWh as of 31 December 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-
party expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology
for measuring CO2eq emissions applied by the Enel Group;
- Euro 1 billion euros at a fixed rate of 0.875%, with settlement date set on 17 June 2021,
maturing 17 June 2036:
the issue price was set at 98.061% and the effective yield at maturity is equal to 1.015%;
the interest rate will remain unchanged to maturity, subject to achievement of a SPT equal to
or lower than 82gCO2eq/kWh as of 31 December 2030;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-
party expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology
for measuring CO2eq emissions applied by the Enel Group.
Multi-tranche USD 4 billion sustainability-linked bond in the U.S. and international markets
The Company placed a multi-tranche USD 4 billion equivalent to about Euro 3.4 billion.
The issue is structured in the following four tranches:
- USD 1.25 billion U.S. at a fixed rate of 1.375%, with settlement date set on 12 July 2021,
maturing 12 July 2026:
the issue price was set at 99.510% and the effective yield at maturity is equal to 1.477%;
the interest rate will remain unchanged to maturity, subject to achievement of a Sustainability
Performance Target (“SPT”) equal to or lower than 148gCO2eq/kWh as of 31 December 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-
party expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology
for measuring CO2eq emissions applied by the Enel Group;
- USD 1 billion at a fixed rate of 1.875%, with settlement date set on 12 July 2021, maturing
12 July 2028:
the issue price was set at 99.596% and the effective yield at maturity is equal to 1.937%;
the interest rate will remain unchanged to maturity, subject to achievement of a SPT equal to
or lower than 148gCO2eq/kWh as of 31 December 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-
party expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology
for measuring CO2eq emissions applied by the Enel Group;


Graphics
59
- USD 1 billion at a fixed rate of 2.250%, with settlement date set on 12 July 2021, maturing 12
July 2031:
the issue price was set at 99.378% and the effective yield at maturity is equal to 2.320%;
the interest rate will remain unchanged to maturity, subject to achievement of a SPT equal to
or lower than 148gCO2eq/kWh as of 31 December 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-
party expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology
for measuring CO2eq emissions applied by the Enel Group;
- USD 0.75 billion at a fixed rate of 2.875%, with settlement date set on 12 July 2021, maturing
12 July 2041:
the issue price was set at 98.769% and the effective yield at maturity is equal to 2.957%;
the interest rate will remain unchanged to maturity, subject to achievement of a SPT equal to
or lower than 82gCO2eq/kWh as of 31 December 2030;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-
party expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology
for measuring CO2eq emissions applied by the Group.
A triple-tranche Euro 3.5 billion sustainability-linked bond in the eurobond market
On 21 September 2021 launched a multi-tranche “Sustainability-Linked bond” for institutional
investors in the Eurobond market for a total of 3.5 billion euros.
The issue is structured in the following three tranches:
- 1,250 million euros at a fixed rate of 0.000%, with settlement date set on September 28th,
2021, maturing May 28th, 2026:
the issue price has been set at 99.702% and the effective yield at maturity is equal to 0.064%;
the interest rate will remain unchanged to maturity, subject to the achievement of a
Sustainability Performance Target (“SPT”) equal to or lower than 148gCO2eq/kWh as of
December 31st, 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-
party expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology
for measuring CO2eq emissions applied by the Group;
- 1,000 million euros at a fixed rate of 0.375%, with settlement date set on September 28th,
2021, maturing May 28th, 2029:
the issue price has been set at 99.902% and the effective yield at maturity is equal to 0.388%;
the interest rate will remain unchanged to maturity, subject to the achievement of an SPT
equal to or lower than 148gCO2eq/kWh as of December 31st, 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-
party expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology
for measuring CO2eq emissions applied by the Group;
- 1,250 million euros at a fixed rate of 0.875%, with settlement date set on September 28th,
2021, maturing September 28th, 2034:


Graphics
60
the issue price has been set at 99.512% and the effective yield at maturity is equal to 0.915%;
the interest rate will remain unchanged to maturity subject to the achievement of an SPT
equal to or lower than 82gCO2eq/kWh at December 31st, 2030;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by a third-
party expert in respect of the Direct Greenhouse Gas Emissions Amount and the methodology
for measuring CO2eq emissions applied by the Group.
Bond repayments
Repayment at maturity
On 12 July Euro bond with nominal amount of Euro 533 million was repaid at its maturity.
The partial refinancing of four series of conventional bonds
On 15 June 2021 the Company completed the non-binding voluntary tender for the repurchase, and
subsequent cancellatio.n, of part of four outstanding series of conventional bonds in euros listed
below:
- Euro 2.5 billion Notes issued on 17 September 2009, due 14 September 2022 and 5.000%
coupon (ISIN XS0452187916);
- Euro 1.0 billion Notes issued on 15 October 2012, due 17 April 2023 and 4.875% coupon (ISIN
XS0842659426);
- Euro 1.5 billion Notes issued on 27 January 2015, due 27 January 2025 and 1.966% coupon
(ISIN XS1176079843);
- Euro 1.3 billion Notes issued on 1 June 2016, due 1 June 2026 and 1.375% coupon (ISIN
XS1425966287).
The Company repurchased in cash part of the aforementioned bonds for an aggregate nominal amount
of Euro 1,069 million. The repurchase transaction was settled on 17 June 2021 at the same time of
the settlement of the issuance of the multi-tranche Sustainability-Linked bond.
Bond repurchase for an aggregate nominal value of 6 billion US dollars
On 27 July 2021 the Company repurchased in cash four of its conventional bonds, guaranteed by Enel,
for an aggregate nominal value of USD 6 billion, following the exercise of a redemption option provided
for in the offering documents of the relevant bonds.
The partial refinancing of four series of conventional bonds
On October 2022 the Company repurchased and subsequently canceled part of the following series of
outstanding conventional bonds denominated in US dollars, following the tenders received and not
validly withdrawn by the Early Expiry Dateof October 4th, 2021 provided for by the non-binding
voluntary tender offer("Tender Offer") launched last September 21st:
- 2.00 billion US dollar bonds issued on May 22nd, 2017, maturing on May 25th, 2027 and coupon
3.625% (ISIN 144A: US29278GAA67; ISIN Reg S: USN30707AC23) (“Notes 2027”);
- 1.25 billion US dollar bonds issued on September 11th, 2018, maturing on June 14th, 2029 and
coupon 4.875% (ISIN 144A: US29278GAK40; ISIN Reg S: USN30707AL22) (“Notes 2029”).


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61
The Company accepted and repurchased in cash conventional bonds for a total nominal amount of
1,471.7 million US dollars
Debt covenants
The main long-term financial debts of the Company are governed by covenants containing
undertakings by the borrowers (Enel S.p.A. and the Company) and by Enel S.p.A. as guarantor that
are commonly adopted in international business practice. The main covenants for the Company are
related to the bond issues carried out within the Euro / Global Medium-Term Notes Programme and
the Revolving Facility Agreement executed on 5 March 2021 by Enel S.p.A. and the Company with a
pool of banks of up to Euro 10 billion. Covenants are non-financial. To date none of the covenants
have been triggered.
The main covenants in respect of the bond issues under the Global/Euro Medium-Term Notes program
(including the Green Bonds of the Company guaranteed by Enel S.p.A., which are used to finance the
Group’s eligible green projects) and those related to the bonds issued by the Company on the US
market guaranteed by Enel SpA can be summarized as follows:
negative pledge clauses under which the issuer may not establish or maintain (except under
statutory requirement) mortgages, liens or other encumbrances on all or part of its assets or
revenues to secure any listed bond or bond for which listing is planned unless the same guarantee
is extended equally or pro rata to the bonds in question;
pari passu clauses, under which the securities constitute a direct, unconditional and unsecured
obligation of the issuer and are issued without preferential rights among them and have at least
the same seniority as other unsubordinated and unsecured obligations, present and future, of the
issuer;
under cross-default clauses, the occurrence of a default event (above a threshold level) in respect
of certain indebtedness of the issuer constitutes a default in respect of the bonds in question,
which may become immediately repayable;
From 2019, the Company issued some “sustainable” bonds on the European market (as part of the
Euro Medium Term Notes - EMTN bond issue program) and on the US market, guaranteed by Enel
SpA, linked to the achievement of a number of the Sustainable Development Goals (SDGs) of the
United Nations that contain the same covenants as other bonds of the same type.
The main covenants for the Revolving Facility Agreement involving the Company and Enel S.p.A. can
be summarized as follows:
negative pledge clause under which the borrower (and Enel S.p.A.’s significant subsidiaries) may
not establish or maintain (with the exception of permitted guarantees) mortgages, liens or other
encumbrances on all or part of their assets to secure certain financial indebtedness;
pari passu clause, under which the payment obligation of the borrower have at least the same
seniority as its other unsubordinated and unsecured payment obligations;
change of control clause which is triggered in the event (i) control of Enel is acquired by one or
more shareholders other than the Italian state or (ii) Enel or any of its subsidiaries transfer a
substantial portion of the Group’s assets to any other persons outside the Group such that the
financial reliability of the Group is significantly compromised. The occurrence of one of the two
circumstances may give rise to (a) the renegotiation of the terms and conditions of the facility or
(b) compulsory early repayment of the facility by the borrower;


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62
rating clauses, which provide for the borrower to maintain their rating above a certain specified
level;
under cross-default clause, the occurrence of a default event (above a threshold level) in respect
of certain financial indebtedness of the borrower or Enel S.p.A.’s “significant” subsidiaries (i.e.
consolidated companies whose gross revenues or total assets are at least equal to a specified
percentage (10% of gross consolidated revenues or total consolidated assets)) constitutes a
default in respect of the facility in question, which may become immediately repayable;
disposals clause, under which the borrower (and Enel S.p.A.’s controlled subsidiaries) may not
dispose of all or any material part of their assets or undertaking with the exception of permitted
disposals.
14 Short-term loans and borrowings – Euro 5,842 million
Millions of Euro
at Dec. 31,
2021
at Dec. 31,
2020
Change
Short-term loans from the Enel Group companies 434
460
(26)
Commercial papers 5,084
2,739
2,345
Cash collaterals on derivatives 324
106
218
Short-term financial debt 5,842
3,305
2,537
Short-term loans
At 31 December 2021 short-term loans decreased by Euro 26 million from 31 December 2020.
Millions of Euro
Original
currency
Euro
countervalue
at 31 Dec
2021
Euro
countervalue
at 31 Dec
2020
Change
Enel Green Power Romania Srl RON
203
124
79
Enel Iberia S.r.l. Euro
171
223
(52)
Generadora Montecristo SA USD
40
60
(20)
Enek Fortuna SA USD
9
33
(24)
Enel Green Power Costa Rica SA USD
-
7
(7)
Enel Investment Holding B.V. Euro
-
2
(2)
Kongul Energì Sanayive Tìcaret Anonìm Sìrket TRY
2
3
(1)
EnerNOC Ireland Limited Euro
-
3
(3)
Enel Green Power Mexico S de RL de CV
USD,
MXN
-
3
(3)
Enel X UK Limited GBP
1
1
0
EGP Australia Pty Ltd AUD
-
1
(1)
Enel Trade Energy SRL Euro
2
-
2
Proveedora de Electricidad de Occidente S de RL de Cv USD
6
-
6
Total
434
460
(26)


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63
Commercial Papers
The payables represented by commercial papers relate to outstanding issuances at 2021 year-end in
the context of the Euro Commercial Paper Programme (hereinafter, also “ECP Programme”), launched
in 2005 by the Company and guaranteed by Enel S.p.A.
Under the ECP Programme the Company can issue short-term promissory notes issued in the interest-
bearer form up to an amount of Euro 6,000 million. Each note can be denominated in any currency,
with a minimum denomination of Euro 500,000 (or GBP 100,000, or USD 500,000, or JPY 100 million
or its equivalent in the relevant currency) and a maturity between one day and one year. The notes
may be issued on a discounted basis or may bear fixed or floating interest rate or a coupon calculated
by reference to an index or formula, and are not listed on any stock exchange.
The total nominal value of commercial papers issued and not yet reimbursed as of 31 December 2021
was Euro 5,084 million (Euro 2,739 million at 31 December 2020).
The following table provides disclosures about changes in liabilities and activity arising from financing
activities, as defined in the cash flows statements, including both changes arising from cash flows and
non-cash changes.
Millions of CU
Notes
at Jan.1,
2021
Changes from
financing cash flows
Non-cash changes
at Dec.
31,
2021
New
issues
Repayments
and other
net changes
Effect of
changes
in foreign
exchange
rates
Other
changes
Long-term borrowings
13
29,390
10,130
(7,978)
1,244
81
32,867
Short-term loans from the Enel
Group companies
14
460
87
(113)
-
-
434
Commercial papers
14
2,739
2,357
-
-
(12)
5,084
Total
32,589
12,574
(8,091)
1,244
69
38,385
15 Other current financial liabilities Euro 323 million
Other current financial liabilities decreased by Euro 75 million and mainly related to interest expenses
accrued on debt outstanding at 31 December 2021.
All payments are expected within 12 months.
16 Fair value measurement
The fair value of assets and liabilities is categorized into a fair value hierarchy that provides three
levels defined as follows on the basis of the inputs to valuation techniques used to measure fair value:
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities to which the
company has access at the measurement date;
Level 2: inputs other than quoted prices included within level 1 that are observable for the asset or
liability, either directly (that is, as prices) or indirectly (that is, derived from prices);
Level 3: inputs for the asset or liability that are not based on observable market data (that is,
unobservable inputs).


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64
In this note, the relevant disclosures are provided in order to assess the following:
- for assets and liabilities that are measured at fair value on a recurring or non-recurring basis in the
balance sheet after initial recognition, the valuation techniques and inputs used to develop those
measurements; and
- for recurring fair value measurements using significant unobservable inputs (Level 3), the effect of
the measurements on profit or loss or other comprehensive income for the period.
For this purpose:
- recurring fair value measurements are those that IFRSs require or permit in the balance sheet at
the end of each reporting period;
- non-recurring fair value measurements are those that IFRSs require or permit in the balance sheet
in particular circumstances.
The fair value of derivative contracts is determined using the official prices for instruments traded on
markets.
The fair value of instruments not listed on a market is determined using valuation methods appropriate
for each type of financial instrument and market data as of the close of the period (such as interest
rates, exchange rates, volatility), discounting expected future cash flows on the basis of the market
yield curve and translating amounts in currencies other than the euro using exchange rates provided
by the European Central Bank.
The notional amount of a derivative contract is the amount on which cash flows are exchanged. This
amount can be expressed as a value or a quantity (for example tons, converted into euros by
multiplying the notional amount by the agreed price).
Amounts denominated in currencies other than euro are converted into euros at the exchange rate
provided by the European Central Bank.
The notional amounts of derivatives reported here do not necessarily represent amounts exchanged
between the parties and therefore are not a measure of the company’s credit risk exposure.
For listed debt instruments, the fair value is given by official prices. For unlisted instruments the fair
value is determined using appropriate valuation techniques for each category of financial instrument
and market data at the closing date of the year, including the credit spreads of Enel Finance
International N.V.


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65
Assets and liabilities measured at fair value in the financial statements
The following table shows the fair value measurement at the end of the reporting period and the level
in the fair value hierarchy into which the fair value measurements are categorised:
Milions of euro Non Current Current
at Dec.
31,
2021
Level 1 Level 2 Level 3
at Dec.
31,
2021
Level 1 Level 2 Level 3
DERIVATIVE ASSETS
Fair value hedge
on foreign exchange risk 12
-
12
-
-
-
-
-
Total 12
-
12
-
-
-
-
-
Cash flow hedge
on interest rate risk 29
-
29
-
-
-
-
on foreign exchange risk 592
-
592
-
-
-
-
Total 621
-
621
-
-
-
-
At fair value through
profit or loss
on interest rate risk 38
-
38
-
-
-
-
on foreign exchange risk -
-
-
-
3
-
3
-
Total 38
-
38
-
3
-
3
-
TOTAL DERIVATIVE
ASSETS
671
-
671
-
3
-
3
-
DERIVATIVE
LIABILITIES
Cash flow hedge
on interest rate risk (55)
-
(55)
-
-
-
-
on foreign exchange risk (380)
-
(380)
-
-
-
-
Total (435)
-
(435)
-
-
-
-
At fair value through
profit or loss
on interest rate risk (38)
-
(38)
-
(2)
-
(2)
-
on foreign exchange risk -
-
-
-
(23)
-
(23)
-
Total (38)
-
(38)
-
(25)
-
(25)
-
TOTAL DERIVATIVE
LIABILITIES
(473)
-
(473)
-
(25)
-
(25)
-


Graphics
66
Millions of euro Non Current Current
at Dec.
31,
2020
Level 1 Level 2 Level 3
at Dec.
31,
2020
Level 1 Level 2 Level 3
DERIVATIVE ASSETS
Fair value hedge
on foreign exchange risk 3
-
3
-
-
-
-
Total 3
-
3
-
-
-
-
Cash flow hedge
on interest rate risk 53
-
53
-
-
-
-
on foreign exchange risk 24
-
24
-
-
-
-
Total 77
-
77
-
-
-
-
At fair value through
profit or loss
on interest rate risk 64
-
64
-
-
-
-
on foreign exchange risk -
-
-
-
54
-
54
-
Total 64
-
64
-
54
-
54
-
TOTAL DERIVATIVE
ASSETS
144
-
144
-
54
-
54
-
DERIVATIVE
LIABILITIES
Cash flow hedge
on interest rate risk (94)
-
(94)
-
-
-
-
on foreign exchange risk (1,379)
-
(1,379)
-
-
-
-
Total (1,473)
-
(1,473)
-
-
-
-
At fair value through
profit or loss
on interest rate risk (66)
-
(66)
-
-
-
-
on foreign exchange risk -
-
-
-
(4)
-
(4)
-
Total (66)
-
(66)
-
(4)
-
(4)
-
TOTAL DERIVATIVE
LIABILITIES
(1,539)
-
(1,539)
-
(4)
-
(4)
-


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67
Assets and liabilities not measured at fair value in the financial statements
The following table shows, for each class of liabilities not measured at fair value in the balance sheet
but for which the fair value shall be disclosed, the fair value at the end of the reporting period and the
level in the fair value hierarchy into which the fair value measurements are categorized.
For listed debt instruments, the fair value is given by official prices while for unlisted instruments the
fair value is determined using appropriate valuation technique for each category of financial instrument
and market data at the closing date of the year.
Milions of euro
note
at Dec. 31,
2021
Level 1 Level 2 Level 3
Financial assets at amortized cost
Medium/long-term financial receivables 6
43,009
-
43,009
-
Short-term financial receivables 9
1,649
-
1,649
-
Total
44,658
-
44,658
-
Borrowings:
Bonds
-fixed rate 13
35,601
35,601
- -
-floating rate 13
469
469
- -
-deposits from the Group 14
431
-
431
-
Short-term borrowings at amortized cost 14
2,740
2,740
- -
Total
39,241
38,810
431
-
Level 2 includes financial assets/liabilities measured at fair value on the basis of the curve on the
market for each currency and the exchange rate for the non-euro currency.
17 Hedging activities and derivatives
Derivatives are initially recognised at fair value, on the trade date of the contract and are subsequently
re-measured at their fair value. The method of recognising the resulting gain or loss depends on
whether the derivative is designated as a hedging instrument, and if so, the nature of the item being
hedged.
Hedge accounting is applied to derivatives entered into, in order to reduce risks such as interest rate
risk, foreign exchange rate risk, when all the criteria provided by IFRS 9 are met.
The Company documents at the inception of the transaction the relationship between hedging
instruments and hedged items, as well as its risk management objectives and strategy. The Company
also documents its assessment, both at hedge inception and on an ongoing basis, of whether hedging
instruments are highly effective in offsetting changes in fair values or cash flows of hedged items.
For cash flow hedges of forecast transactions designated as hedged items, the Company assesses and
documents that they are highly probable and present an exposure to changes in cash flows that affect
profit or loss.


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68
To be effective a hedging relationship shall meet all of the following criteria:
- existence of an economic relationship between hedging instrument and hedged item;
- the effect of credit risk does not dominate the value changes resulting from the economic
relationship;
- the hedge ratio defined at designation resulting equal to the one used for risk management
purposes (i.e. same quantity of the hedged item that the entity actually hedges and the quantity
of the hedging instrument that the entity actually uses to hedge the quantity of the hedged item).
Based on the IFRS 9 requirements, the existence of an economic relationship is evaluated by the
Company through a qualitatively assessment or a quantitatively computation, depending of the
following circumstances:
- if the underlying risk of the hedging instrument and the hedged item is the same, the existence of
an economic relationship will be provided through a qualitative analysis;
- on the other hand, if the underling risk of the hedging instrument and the hedged item is not the
same, the existence of the economic relationship will be demonstrated through a quantitative
method in addition to a qualitative analysis of the nature of the economic relationship (i.e. linear
regression).
In order to demonstrate that the behaviour of the hedging instrument in line with those of the hedged
item, different scenarios will be analysed.
In order to evaluate the credit risk effects, the Company considers the existence of risk mitigating
measures (collateral, mutual break-up clauses, netting agreements, etc.).
The Company has established a hedge ratio of 1:1 for all the hedging relationships as the underlying
risk of the hedging derivative is identical to the hedged risk, in order to minimize hedging
ineffectiveness.
The hedge ineffectiveness will be evaluated through a qualitative assessment or a quantitative
computation, depending on the following circumstances:
- if the critical terms of the hedged item and hedging instrument match and there aren’t other
sources of ineffectiveness included the credit risk adjustment on the hedging derivative, the hedge
relationship will be considered fully effective on the basis of a qualitative assessment;
- if the critical terms of the hedged item and hedging instrument do not match or there is at least
one source of ineffectiveness, the hedge ineffectiveness will be quantified applying the dollar offset
cumulative method with hypothetical derivative. This method compares changes in fair values of
the hedging instrument and the hypothetical derivative between the reporting date and the
inception date.
The main causes of hedge ineffectiveness may be the followings:
- basis differences (i.e. the fair value or cash flows of the hedged item depend on a variable that is
different from the variable that causes the fair value or cash flows of the hedging instrument to
change);
- timing differences (i.e. the hedged item and hedging instrument occur or are settled at different
dates);
- quantity or notional amount differences (i.e. the hedged item and hedging instrument are based
on different quantities or notional amounts);
- other risks (i.e. changes in the fair value or cash flows of a derivative hedging instrument or hedged
item relate to risks other than the specific risk being hedged);
- credit risk (i.e. the counterparty credit risk differently impact the fair value movements of the
hedging instruments and hedging item)


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69
Fair value hedge
Fair value hedges are used to protect the Company against exposures to changes in the fair value of
assets, liabilities or firm commitment attributable to a particular risk that could affect profit or loss.
Changes in fair value of derivatives that qualify and are designated as hedging instruments are
recognised in the income statement, together with changes in the fair value of the hedged item that
are attributable to the hedged risk.
If the hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount
of a hedged item for which the effective interest rate method is used is amortized to profit or loss over
the period to maturity.
Cash flow hedge
Cash flow hedges are applied in order to hedge the Company exposure to changes in future cash flows
that are attributable to a particular risk associated with a recognised asset or liability or a highly
probable transaction that could affect profit or loss.
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash
flow hedges is recognised in other comprehensive income. The gain or loss relating to the ineffective
portion is recognised immediately in the income statement.
Amounts accumulated in equity are reclassified to profit or loss in the periods when the hedged item
affects profit or loss.
When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge
accounting, any cumulative gain or loss existing in equity at that time remains in equity and is
recognised when the forecast transaction is ultimately recognised in the income statement. When a
forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in
equity is immediately transferred to the income statement.
Hedging relationships using cross currency basis spread as hedging instrument, the Company
separates foreign currency basis spread, in designating the hedging derivative, and present them in
other comprehensive income (OCI).
The following tables report the notional amount and fair value of derivative financial assets and
liabilities by type of hedge relationship and hedged risk, broken down into current and non-current
derivative financial assets and liabilities.
The notional amount of a derivative contract is the amount on the basis of which cash flows are
exchanged. Amounts denominated in currencies other than the euro are converted at the end-year
exchange rates provided by the European Central Bank.


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70
Non Current Current
Notional amount Fair value Notional amount Fair value
at Dec.
31,
2021
at Dec.
31,
2020
at Dec.
31,
2021
at Dec.
31,
2020
at Dec.
31,
2021
at Dec.
31,
2020
at Dec.
31,
2021
at Dec.
31,
2020
DERIVATIVE ASSETS
Fair value hedge
on foreign exchange risk
595
557
12
3 -
- -
-
Total
595
557
12
3 -
- -
-
Cash flow hedge
on interest rate risk
722
806
29
53
-
- -
-
on foreign exchange risk
10,090
2,479
592
24
-
- -
-
Total
10,812
3,285
621
77
-
- -
-
DERIVATIVE
LIABILITIES
Cash flow hedge
on interest rate risk
841
900
(55)
(94)
100
- -
-
on foreign exchange risk
5,581
13,513
(380)
(1,379)
-
- -
-
Total
6,422
14,413
(435)
(1,473)
100
- -
-
Interest rate benchmark reform and associated risks
Overview
Interbank Offered Rates (“IBORs”) are benchmark rates at which banks can borrow funds on the
interbank market on an unsecured basis for a given period ranging from overnight to twelve months,
in a specific currency.
In recent years there have been several cases of manipulation of these rates by the banks contributing
to their calculation. For this reason, regulators around the world have begun a fundamental reform of
major interest rate benchmarks, including the replacement of some IBORs with alternative nearly risk-
free rates (IBOR reform).
The Company’s main IBOR exposure is based to EURIBOR, USD LIBOR.
Euribor is still considered compliant with the European Benchmarks Regulation (BMR) and this allows
market participants to continue to use Euribor for both existing and new contracts.
According to the most recent announcements on this matter published from the relevant regulators:
- USD LIBOR 1-month, 3-month and 6-month will become non-representative after June 30, 2023
and the alternative reference rate is the Secured Overnight Financing Rate (SOFR);
- GBP LIBOR 1-month, 3-month and 6-month became non-representative after December 31,
2021 and the alternative reference rate is the Sterling Overnight Index Average (SONIA).
As a consequence of the IBOR reform some temporary reliefs to hedge accounting rules are provided
by the amendments to IFRS 9 issued in September 2019 (Phase 1) and in August 2020 (Phase 2), in
order to address, respectively:
- pre-replacement issues affecting financial reporting in the period preceding the replacement of
an existing interest rate benchmark with an alternative risk-free rate; (i.e. Phase 1); and
- replacement issues that might affect financial reporting when an existing interest rate
benchmark is either reformed or replaced, hence when initial uncertainty is gone, but contracts
and hedging relationships are to be updated in order to reflect new rates (i.e. Phase 2).


Graphics
71
Impact of IBOR reform on the Company
Loans, debt and derivatives
The Company holds floating rate lending portfolio mainly indexed to Euribor and USD Libor.
At the reporting date, no actions are planned by the Company for Euribor since, as mentioned before,
it has been fully reformed to comply with the European Union Benchmarks Regulation.
Notwithstanding the Euribor continuation, fallback provisions may be required and therefore would be
implemented by the Company within new contracts according to the evolution of market’s best
practice.
The Company’s derivative instruments are governed by contracts mainly based on the International
Swaps and Derivatives Association (ISDA)’s master agreements.
ISDA reviewed its standard contracts in light of IBOR reform and amended certain floating-rate options
in the 2006 ISDA definitions to include fallback clauses that would apply on the permanent
discontinuation of specific key IBORs; these changes came into effect on January 25, 2021.
Transactions incorporating the 2006 ISDA Definitions, that are entered into on or after January 25,
2021, include the amended floating rate option (i.e., the floating rate option with the fallback), while
the other transactions, signed previous to this date (so called “legacy derivative contracts”), continue
to be based on the 2006 ISDA Definitions. For this reason, ISDA published an IBOR fallback protocol
to facilitate multilateral amendments to include the amended definitions. The Company is still
evaluating whether: (i) to adhere to the protocol, based on its exposure and on the IBOR Reform
evolution, or; (ii) to early amend the contracts impacted by the reform bilaterally.
Hedge Accounting
The Company’s hedged items and hedging instruments as at the reporting date are mainly indexed to
USD Libor.
The Company has assessed the impact of uncertainty engendered by the IBOR reform on hedging
relationships at December 31, 2021 with reference to both hedging instruments and hedged items.
Both the hedged items and the hedging instruments will change their indexation from IBORs to RFRs
(Risk Free Rate) as a result of contractual amendments that are expected to come into effect in the
following years.
In particular, there is still uncertainty on how the replacement may occur, with respect to both relevant
hedged items and hedging instruments indexed to USD Libor. In order to deal with the uncertainties
related to such hedging relationships, the Company, therefore, continues to apply the temporary
reliefs provided by the amendments to IFRS 9 issued in September 2019 (Phase 1). Hence, it has
considered that the interest rate benchmark on which the cash flows of the hedged item or of the
hedging instrument were based is not altered because of the IBOR reform. The relief has been applied
for the purposes of the following hedge accounting requirements:
- determining whether a forecast transaction is highly probable;
- determining whether the hedged future cash flows are still expected to occur for a discontinued
cash flow hedging; and
- assessing the economic relationship between the hedged item and the hedging instrument.


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72
The hedging relationships impacted may experience ineffectiveness attributable to the different
replacement of the existing IBOR benchmark rates to their alternative RFRs. However, the Company
will work in order to implement the same replacements at the same time.
The following table provides a breakdown of the notional amounts of the hedging instruments for
which the Phase 1 amendments or Phase 2 amendments to IFRS 9 have been applied as of December
31, 2021, disaggregated by IBOR rate:
Milions of CU
at Dec. 31, 2021
Hedging instruments
(1)
Phase 1
Phase 2
USD LIBOR / SOFR 164
0
GBP LIBOR / SONIA 0
0
Total 164
0
(1) Since the hedging relationships mentioned in this respect are highly effective, the amount specified in the table as “hedging instruments” de facto
represent equivalent amounts in hedged items.
Unreformed contracts including those with an appropriate fallback clause
The Company monitors the progress of transition from IBORs to new benchmark rates by reviewing
the total amounts of contracts that have yet to transition to an alternative benchmark rate and the
amounts of such contracts that include an appropriate fallback clause. The Company considers that a
contract is not yet transitioned to an alternative benchmark rate when interest under the contract is
indexed to a benchmark rate that is still subject to IBOR reform, hence when uncertainties related to
how and when the replacement with a new rate still exists.
Hedge relationships by type of risk hedged
Interest rate risk
The following table shows the notional amount and the average price of interest rate risk hedging
instruments outstanding as at December 31, 2021 broken down by maturity:
Millions of euro
Maturity
2022
2023
2024
2025
2026
Beyond
Total
Interest rate swap:
Total Notional value
150
150
100
50
-
2,128
2,578
Notional value in Euro 150
150
100
50
-
1,099
1,549
Average interest rate in Euro
4
4.5633
6.0790
4.9150
-
0.5063
-
Notional value in USD
-
-
-
-
-
1,029
1,029
Average interest rate in USD
-
-
-
-
-
1.4471
-
The following table reports the notional amount and fair value of the hedging instruments on interest
rate risk of transactions outstanding as at 31 December 2021 and 31 December 2020, broken down
by type of hedged item:
Millions of euro Fair value
Notional
amount
Fair
value
Notional
amount
Hedged instruments Hedged item
at Dec. 31,
2021
at Dec.
31,
2021
at Dec.
31,
2020
at Dec.
31,
2020
Interest rate swaps Floating-rate borrowings (60)
900
(94)
900
Interest rate swaps Floating-rate lendings 30
763
53
806
Total
(30)
1,663
(41)
1,706


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73
The following table shows the notional amount and the fair value of hedging derivatives on interest
rate risk as at 31 December 2021 and 31 December 2020, broken down by type of hedge:
Millions of euro Notional amount Fair value assets
Notional amount
Fair value liabilities
Derivatives
at Dec.
31,
2021
at Dec.
31,
2020
at
Dec.
31,
2021
at Dec.
31,
2020
at Dec.
31,
2021
at
Dec.
31,
2020
at Dec.
31,
2021
at Dec.
31,
2020
Interest rate swaps 872
806
32
53
791
900
(62)
(94)
Total interest rate derivatives 872
806
32
53
791
900
(62)
(94)
Cash flow hedge derivatives
The following table shows the cash flows expected in coming years from cash flow hedge derivatives
on interest rate risk:
Millions of euro
Fair value
Distribution of expected cash flows
at Dec. 31,
2022
2023
2024
2025
2026
Beyond
Cash flow hedge derivatives on
interest rates:
- Positive fair value 29
10
7
5
3
3
4
- Negative fair value (55)
(16)
(14)
(11)
(9)
(8)
(3)
Total Interest rate derivatives (26)
(6)
(7)
(6)
(6)
(5)
1
Exchange rate risk
The following table shows the notional amount and the average price of foreign exchange risk hedging
instruments outstanding as at 31 December 2020 broken down by maturity.
Millions of euro
Maturity
2022
2023
2024
2025
2026
Beyond
Total
Cross currency interest rate swap:
Total Notional value
-
203
3,507
432
1,104
11,021
16,266
Notional value CCIRS Euro-USD
-
-
2,158
353
1,104
8,633
12,248
Average exchange rate Euro/USD
-
-
1.1345
1.1846
1.1790
1.2094
-
Notional value CCIRS Euro-GBP
-
-
1,012
-
-
2,262
3,274
Average exchange rate Euro/GBP
-
-
- 0.8765
-
-
0.8840
-
The following table shows the notional amount and the fair value of the hedging instruments on foreign
exchange risk of transactions outstanding as at 31 December 2021 and 31 December 2020, broken
down by type of hedged item:
Millions of euro Fair value
Notional
amount
Fair
value
Notional
amount
Hedged instruments Hedged item
at Dec. 31,
2021
at Dec.
31,
2021
at Dec.
31,
2020
at Dec.
31,
2020
Cross currency interest rate swap
(CCIRS)
Fixed-rate borrowings in
foreign currencies
327
14,083
(1,355)
15,992
Cross currency interest rate swap
(CCIRS)
Fixed-rate lendings in
foreign currencies
(75)
1,588
-
-
Total
252
15,671
(1,355)
15,992
The following table shows the notional amount and the fair value of hedging derivatives on foreign
exchange risk of transactions outstanding as at 31 December 2021 and 31 December 2020, broken
down by type of hedge:


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74
Millions of euro
Notional
amount
Fair value
assets
Notional amount Fair value liabilities
Derivatives
at Dec.
31,
2021
at
Dec.
31,
2020
at
Dec.
31,
2021
at Dec.
31,
2020
at Dec.
31,
2021
at Dec.
31,
2020
at Dec.
31,
2021
at Dec.
31,
2020
Cross currency interest rate swap
(CCIRS)
11,652
2,479
631
24
4,019
13,513
(379)
(1,379)
Total interest rate derivatives
11,65
2
2,479
631
24
4,019
13,51
3
(379)
(1,379
)
Fair value hedge derivatives
The following table shows separately gains or losses of fair value hedge derivatives on foreign
exchange risk and those on the hedged items attributable to the hedged risk for
Millions of CU 2021 2020
Net Gains /(Losses)
Net Gains /(Losses)
Hedging instruments 10
3
Hedged items 34
3
Ineffectiveness -
-
Cash flow hedge derivatives
The following table reports expected cash flows related to derivatives for the coming years:
Millions of euro
Fair value
Distribution of expected cash flows
at Dec. 31,
2022
2023
2024
2025
2026
Beyond
Cross currency interest rate swap
Positive Fair value derivatives 593
135
135
178
136
175
1,457
Negative fair value derivatives (380)
22
10
(36)
(10)
10
289
Total Exchange rate derivatives
213
157
145
142
126
185
1,746
Impact of hedging derivatives on balance sheet, statement of profit or loss and other
comprehensive income and equity
The impact of the hedging instruments on the balance sheet is, as follows:
Millions of Euro
Notional
amount
Carrying
amount
Line item in
the
statement
of financial
position
Fair value
used for
measuring
ineffectiveness
for the period
at Dec. 31,
2021
Interest rate swap (IRS)
1,663
(27)
Derivatives
(27)
Cross currency interest rate swap (CCIRS)
15,671
213
Derivatives
214
at Dec. 31,
2020
Interest rate swap (IRS)
1,706
(41)
Derivatives
(41)
Cross currency interest rate swap (CCIRS)
15,992
(1,355)
Derivatives
(1,172)


Graphics
75
The impact of the hedged item on the balance sheet is, as follows:
Millions of Euro
2021
2020
Fair value
used for
measuring
ineffectiveness
Cash
flow
hedge
reserve
Cost of
hedging
reserve
Fair value
used for
measuring
ineffectiveness
Cash
flow
hedge
reserve
Cost of
hedging
reserve
Floating-rate borrowings
54
(54)
-
94
(94)
-
Floating-rate lendings
(27)
27
-
(54)
54
-
Floating-rate lendings in foreign
currencies
67
(67)
-
2
-
-
Fixed-rate borrowings in foreign
currencies
(281)
281
2
1,172
(1,172)
(183)
Total
(187)
187
2
1,210
(1,212)
(183)
The effect of the cash flow hedge in the statement of profit or loss and other comprehensive income
is:
Millions of Euro
Total
hedging
gain/(loss)
recognised
in OCI
Ineffectiveness
recognised in
profit or loss
Line item
in the
statement
of profit
or loss
Cost of
hedging
recognised
in OCI
Amount
reclassified
from OCI
to profit or
loss
Line item in the
statement of
profit or loss
at Dec. 31,
2021
Floating-rate
borrowings
40
-
Derivatives
-
-
Financial expense
from derivative
Floating-rate lendings (27)
-
Derivatives
-
-
Financial expense
from derivative
Floating-rate lendings
in foreign currencies
(69)
-
Derivatives
-
-
Financial expense
from derivative
Fixed-rate borrowings
in foreign currencies
1,453
-
Derivatives
185
(1,102)
Financial expense
from derivative
at Dec. 31,
2020
Floating-rate
borrowings
79
-
Derivatives
-
-
Financial expense
from derivative
Floating-rate lendings 15
-
Derivatives
-
-
Financial expense
from derivative
Fixed-rate borrowings
in foreign currencies
(1,077)
-
Derivatives
(78)
1,342
Financial expense
from derivative
The following table reports the impact of cash flow hedge derivatives on equity during the period,
gross of the fiscal impact:
2021
2020
Millions of
Euro
Cost of
hedgin
g
Gross
changes in
fair value
recognized
in
equity (b
)
Gross
changes in
fair value
transferre
d to
income –
Recycling
Gross changes
in fair value
transferred to
income -
Ineffectivenes
s
Cost of
hedgin
g
Gross
changes in
fair value
recognized
in
equity (b
)
Gross
changes in
fair value
transferre
d to
income –
Recycling
Gross changes
in fair value
transferred to
income -
Ineffectivenes
s
Interest
rate
hedging
-
13
-
-
-
94
-
-
Exchange
rate
hedging
185
1,384
-
-
(78)
(1,077)
-
-
Hedging
derivative
s
185
1,397
-
-
(78)
(983)
-
-


Graphics
76
The amount of effective changes in the fair value of cash flow hedge derivatives, not yet settled,
corresponding to hedges on the exchange rate on hedged items released in order to offset the
adjustment at the spot exchange rate of the hedged assets/liabilities denominated in a foreign
currency at the end of the reporting period totalled to Euro 1,102 million.
Derivatives at fair value through profit or loss
The following tables show the notional amount and the fair value of derivatives assets and liabilities
at FVTPL, as at 31 December 2021 and 31 December 2020, classified on the basis of each type of risk,
broken down into current and non-current.
Milions of euro Non Current Current
Notional amount Fair value Notional amount Fair value
at Dec.
31,
2021
at Dec.
31,
2020
at Dec.
31,
2021
at Dec.
31,
2020
at Dec.
31,
2021
at Dec.
31,
2020
at Dec. 31,
2021
at Dec.
31,
2020
DERIVATIVE ASSETS
At fair value through
profit or loss
on interest rate risk
433
449
38
64
50
-
1
-
on foreign exchange risk -
-
-
-
968
3,230
2
54
Total
433
449
38
64
1,018
3,230
3
54
DERIVATIVE
LIABILITIES
At fair value through
profit or loss
on interest rate risk
433
449
(38)
(66)
50
-
(2)
-
on foreign exchange risk -
-
-
-
1,526
508
(23)
(4)
Total
433
449
(38)
(66)
1,576
508
(25)
(4)
The following table reports expected cash flows related to derivatives for the coming years:
Fair value
Distribution of expected cash flows
at Dec. 31, 2021 2022 2023 2024 2025 2026 Beyond
Fair value through
profit or loss
derivatives on interest
rates:
Positive Fair value
derivatives
39 14 10 7 6 6 3
Negative fair value
derivatives
(40) 35 (10) (7) (6) (6) (3)
Total (1) 49 -
- - - -
Fair value
Distribution of expected cash flows
at Dec. 31, 2021 2022 2023 2024 2025 2026 Beyond
Fair value through
profit or loss
derivatives on
exchange rates:
Positive Fair value
derivatives
2 2 - - - - -
Negative fair value
derivatives
(23) 23 - - - - -
Total (21) 21 - - - - -


Graphics
77
18 Related parties
Transactions between Enel Finance International N.V. and other companies of the Enel Group involve
Financing and Treasury management.
The main activity of Enel Finance International N.V. is to operate as financing company of the Enel
Group, raising funds through bonds issuance, loans and other facilities and on turn lending the funds
so raised to the companies belonging to Enel Group.
Enel Finance International N.V. is also part of the centralizing financial flow process and acts as the
primary reference for the management of financial needs or liquidity generated by the entities that
operate outside of Italy and are part of the Enel Group.
The company enters into plain vanilla transaction with Enel S.p.A., such as currency forwards and
cross currency interest rate swaps in order to mitigate the interest and exchange rates risks.
These transactions are part of the ordinary operations of the Company and are settled on the basis of
Standard intra-Group contract market prices.
Enel Finance International N.V. has no business relations with Key management personnel during the
financial year.
The following table summarizes the financial relationships between the Company and its related
parties at 31 December 2021 and 31 December2020 respectively:
Millions of euro
Receivables Payables Income Cost
at Dec. 31,
2021
2021
Shareholder
Enel S.p.A
24,236
1
204
67
(Subtotal)
24,236
1
204
67
Other affiliated companies
Villanueva Solar, S.A. De C.V.
47
-
7
-
Ampla Energia E Servicos S.A.
562
-
14
1
Parque Solar Villanueva Tres, S.A. De C.V.
31
-
5
-
Parque Solar Don Jose, S.A. De C.V.
19
-
3
-
Energia Limpia De Amistad, S.A De C.V.
84
-
15
-
Enel Green Power Peru Sa (USD)
5
-
-
-
Slovak Power Holding B.V.
655
-
31
-
Enel Green Power Romania Srl
-
203
3
1
Parque Salitrillos, S.A. de C.V.
70
-
9
-
Ngonye Power Company Limited
3
-
1
-
Enel Green Power Australia Pty Ltd
-
-
1
1
Enel X S.r.l.
101
-
1
-
Companhia Energetica Do Ceara - Coelce
81
-
11
-
Enel Rinnovabile, S.A. de C.V.
17
-
2
-
Dolores Wind Sa De Cv
104
-
11
-
Parque Amistad Ii Sa De Cv
51
-
6
-
Parque Amistad Iii Sa De Cv
57
-
6
-
Parque Amistad Iv Sa De Cv
32
-
4
1
Enel Green Power Hellas Sa
316
-
23
(1)
Endesa SA
3,014
-
93
-
Enel Brasil S.A
-
-
1
-


Graphics
78
Enel Green Power Costa Rica S.A.
-
-
2
3
Enel Iberia SRL
3,712
171
25
-
Enel Fortuna SA
-
9
-
1
Enel Green Power Spa GLO
1,809
-
39
38
Enel Investment Holding BV
-
2
-
(1)
Enel Green Power Panama SA
34
-
5
-
Enel Italia S.p.A.
8,767
-
136
(1)
Egp Magdalena Solar SA de CV
94
-
11
-
Enel Global Trading Spa IT
799
-
11
1
Enel X Uk Limited
-
1
-
-
Enel Americas S.A.
1
2
9
1
Generadora Montecristo, S.A.
-
40
-
5
Enel Green Power Mexico S de RL de CV
314
-
41
2
Enel X Korea Limited
5
-
-
-
PH Chucas S.A.
62
-
12
-
Enel X Japan K.K.
1
-
-
-
Juicenet Gmbh
2
-
-
-
Cohuna Solar Farm Pty Ltd
27
-
2
1
Proveedora de Electricidad de Occidente Srl de
cv
-
6
-
-
Enel X Norway AS
1
-
-
-
Celg Distribuicao S.A. Celg D.
366
-
21
1
Enel Insurance NV
5
-
-
-
Viva Labs AS
3
-
-
-
EGP Americas SpA
-
-
-
14
Enel Trade Energy SRL
4
2
-
-
Dominica Energia Limpia S. de R.L. de C.V.
44
-
8
-
Energias Renovables La Mata SAPI de CV
-
-
5
(1)
Enel Green Power Rsa (PTY) Ltd
38
-
3
1
Kongul Enerji Sanayi Ve Ticaret Anonim Sirketi
2
2
1
Enel Green Power Chile SA
-
-
24
-
Energia Limpia De Palo Alto, S. De R.L. De C.V.
139
1
18
-
Vientos de Altiplano, S. de R.L. de C.V.
27
-
5
-
Enel Chile S.A.
2,199
-
161
(1)
(Subtotal)
23,702
439
787
68
Total
47,938
440
991
136
Millions of euro
Receivables Payables Income Cost
at Dec. 31,
2020
2020
Shareholder
Enel S.p.A
13524
63
165
175
(Subtotal)
13,524
63
165
175
Other affiliated companies
Open Fiber SpA
-
-
-
-
Villanueva Solar, S.A. De C.V.
40
-
2
4
Ampla Energia E Servicos S.A.
117
-
-
2
Parque Solar Villanueva Tres, S.A. De C.V.
27
-
2
2
Parque Solar Don Jose, S.A. De C.V.
16
-
1
2
Energia Limpia de Amistad, S. de R.L. de C.V.
77
-
11
13
Enel Green Power Peru Sa (USD)
-
-
7
6
Slovak Power Holding B.V.
452
-
25
-
Enel Green Power Romania Srl
-
124
2
1
Parque Salitrillos, S.A. de C.V.
72
-
4
7
Enel Energia, S.A. de C.V.
-
-
1
-
Ngonye Power Company Limited
2
-
1
1


Graphics
79
Enel Green Power Argentina Sa
-
-
-
-
Enel Green Power Australia Pty Ltd
-
-
2
4
Enel Green Power Canada Inc.
-
-
5
10
Tynemouth Energy Storage Limited
7
1
-
-
Enel Green Power Australia Trust
-
1
-
-
Enel X North America, Inc.
-
-
-
-
Companhia Energetica Do Ceara - Coelce
-
-
-
-
El Paso Solar Sas Esp
-
-
-
-
Enel Rinnovabile, S.A. de C.V.
16
-
1
1
Kino Contractor S.A. de C.V.
-
-
1
1
Dolores Wind Sa De Cv
85
-
10
12
Parque Amistad Ii Sa De Cv
40
-
4
6
Parque Amistad Iii Sa De Cv
38
-
5
6
Parque Amistad Iv Sa De Cv
12
-
8
6
Enel Green Power Hellas Sa
322
-
21
2
Endesa SA
3,014
-
90
(1)
Enel Brasil S.A
1
-
1
-
Enel Green Power Costa Rica
-
7
1
1
e-distribuzione SpA
-
-
102
(9)
Enel X International S.R.L.
-
-
-
-
Parque Eolico Pampa Sa
4
-
-
-
Enel Iberia SRL
4,066
223
30
(1)
Enel Fortuna SA
-
33
5
2
Enel Green Power Bulgaria EAD
3
-
-
-
Enel Green Power Spa IT
1,940
-
63
(1)
Enel Investment Holding BV
-
5
-
(1)
Enel North America, Inc.
-
-
-
-
Enel Green Power Panama SA
36
-
2
4
Enel Produzione IT
-
-
32
(3)
Enel Italia Srl IT
8,766
-
829
8
Servizio Elettrico Nazionale SpA
-
-
-
1
Enel Sole Srl
-
-
1
-
Egp Magdalena Solar SA de CV
77
-
8
8
Enel Global Trading Spa IT
199
-
18
-3
EnerNOC Ireland Limited
-
3
-
-
Enel X Polska Sp. Zo.O.
1
-
-
-
Eletropaulo Metropolitana Eletricidade De Sao
Paulo S.A.
-
-
-
-
Pincher Creek Lp
-
-
-
-
Riverview Lp
-
1
1
1
Enel Americas S.A.
123
-
2
15
Generadora Montecristo, S.A.
-
60
6
2
Enel Green Power Mexico S de RL de CV
270
3
38
31
Enel Finance America, Llc
-
-
2
5
Enel X Korea Limited
5
-
-
-
PH Chucas S.A.
87
-
7
9
Juicenet Gmbh
-
-
-
-
Enel X Mobility Romania SRL
-
-
-
-
For further details of the each relation with related parties please refer to notes 6, 9, 14.
The impact of transactions with related parties on the balance sheet, income statement and cash flows
is reported in the following tables.


Graphics
80
Impact on balance sheet
Millions of Euro
Total
Related
parties
%of total
Total
Related
parties
%of
total
at Dec. 31,
2021
at Dec. 31,
2020
Assets
Long-term loans and financial receivables
including current portion
40,745
40,745
100%
32,177
32,177
100%
Derivatives- non-current 671
80
12%
144
121
84%
Short-term loans and financial receivables 6,947
6,947
100%
2,677
2,677
100%
Derivatives - current 3
-
0%
54
1
2%
Other current financial assets 662
161
24%
1,579
132
8%
Other current assets -
-
0%
8
8
100%
Liabilities
Derivatives- non-current 473
2
0%
1,539
2
0%
Income tax payable 1
1
100%
46
2
4%
Short-term loans and borrowings 5,842
434
7%
3,305
460
14%
Derivatives - current 25
-
0%
4
0
0%
Other current financial liabilities 323
1
0%
395
61
15%
Other current liabilities 2
1
50%
2
2
100%
Impact on income statement
Millions of Euro
Total
Related
parties
%of total
Total
Related
parties
%of
total
at Dec. 31,
2021
at Dec. 31,
2020
Interest income 691
696
101%
757
757
100%
Interest income from derivatives 321
25
8%
326
51
16%
Other income -
-
0%
710
710
100%
Interest expense 1,282
65
5%
1,212
66
5%
Interest expense from derivatives 192
26
14%
233
112
48%
Other expenses 634
-
0%
4
4
100%
Other operating expenses 5
2
40%
5
1
20%
Financial income on derivatives 1,700
1
0%
360
9
3%
Other financial income 299
271
91%
1,424
65
5%
Financial expense on derivatives 519
1
0%
1,483
8
1%
Other financial expense 1,294
45
3%
345
305
88%


Graphics
81
19 Contractual commitments and guarantees
The notes issued by the Company under the GMTN programme are guaranteed by Enel
S.p.A. Commercial papers issued in the context of the Euro Commercial Paper Programme
launched in 2005 by the Company are also guaranteed by Enel S.p.A. Furthermore, Enel S.p.A has
confirmed their commitment to provide the Company with support until next year's approval of the
financial statements, should the Company remain under control of Enel S.p.A. The Company has not
given guarantees to third parties up to the reporting date.
20 Offsetting financial assets and financial liabilities
At December 31, 2021, the Company did not hold offset positions in assets and liabilities, as it is not
the Enel policy to settle financial assets and liabilities on a net basis.
21 Compensation of Directors
The emoluments of the Company Directors as intended in Section 2:383 (1) of the Dutch Civil Code,
which were charged in 2021, amounted to Euro 111 thousand (Euro 116 thousand in 2020)
represented short-term employee benefits and summarized in the following table:
Thousands of euro
at Dec. 31,
2021
at Dec. 31,
2020
A.J.M. Nieuwenhuizen 29
29
H. Marseille 29
29
E. Di Giacomo 29
29
J. Homan 24
29
A. Canta -
-
Total 111
116
22 Fees of the auditors
The independent auditor of the Company is KPMG Accountants N.V. which succeeded Ernst & Young
Accountants LLP having been appointed by the shareholders’ meeting of ENEL N.V. held on 20 May
2020.
With reference to Section 2:382 a (1) and (2) of the Netherlands Civil Code, below a summary is
provided of services performed by KPMG Accountants N.V. and Ernst & Young Accountants LLP and
fees for each year accrued as per 31 December in the respective years.
Thousands of euro
at Dec. 31,
2021
at Dec. 31,
2020
Audit
124
70
Audit related services in connection with GMTN prospectus
29
61
Tax
-
-
Other
-
-
Total
153
131


Graphics
82
23 Subsequent events
Triple-tranche 2.75 billion euro “Sustainability-Linked Bond” in the Eurobond market
On 10 January 2022 the Company launched a multi-tranche “Sustainability-Linked bond for
institutional investors in the Eurobond market for a total of 2.75 billion euros.
Specifically, the issue is structured in the following three tranches:
- 1,250 million euros at a fixed rate of 0.250%, with settlement date set on January 17th, 2022,
maturing November 17th, 2025:
the issue price has been set at 99.829% and the effective yield at maturity is equal to 0.295%;
the interest rate will remain unchanged to maturity, subject to the achievement of a
Sustainability Performance Target (“SPT”) equal to or lower than 148gCO2eq/kWhas of
December 31st, 2023;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by an external
verifier in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Group;
- 750 million euros at a fixed rate of 0.875%, with settlement date set on January 17th, 2022,
maturing January 17th, 2031:
the issue price has been set at 98.700% and the effective yield at maturity is equal to 1.027%;
the interest rate will remain unchanged to maturity, subject to the achievement of an SPT
equal to or lower than 140gCO2eq/kWhas of December 31st, 2024;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by an external
verifier in respect of the Direct Greenhouse Gas Emissions Amount and the methodology for
measuring CO2eq emissions applied by the Group;
- 750 million euros at a fixed rate of 1.250%, with settlement date set on January 17th, 2022,
maturing January 17th, 2035:
the issue price has been set at 99.334% and the effective yield at maturity is equal to 1.306%;
the interest rate will remain unchanged to maturity, subject to the achievement of an SPT
equal to or lower than 82gCO2eq/kWhas of December 31st, 2030;
if the SPT is not achieved, a step-up mechanism will be applied, increasing the rate by 25 bps
as of the first interest period subsequent to the publication of the report issued by an external
verifier in respect of the Direct Greenhouse Gas Emissions Amountand the methodology for
measuring CO2eq emissions applied by the Group.
750 million pound sterling “Sustainability-Linked Bond”
On 5 April 2022 the Company launched in the market a pound sterling single-tranche “Sustainability-
Linked Bond” for institutional investors totaling 750 million pounds sterling, equivalent to
approximately 900 million euros.
The new issuance is linked to the achievement of Enel’s sustainability objective relating to the
reduction of direct greenhouse gas emissions (Scope 1), contributing to United Nations Sustainable
Development Goal 13 (Climate Action) and in accordance with the Enel Group’s Sustainability-Linked
Financing Framework


Graphics
83
The issuance is structured as a single tranche of 750 million pounds sterling paying a rate of 2.875%
maturing on 11 April 2029. The issue price has been set at 99.947% and the effective yield at maturity
is equal to 2.883%. The settlement date for the issue is on 11 April 2022.
The interest rate will remain unchanged to maturity, subject to the achievement of an SPT equal to or
lower than 140gCO2eq/kWh at December 31st, 2024.
Geopolitical Crisis
Following the conflict between Russia and Ukraine, the Enel Group has carefully monitored the
evolution of this geopolitical crisis by assessing any potential impact on its operations and
consequences for its business.
Today, the Enel Group is present in Russia with a number of companies in which it holds control or
joint control with other investors. The Russian companies of Enel are involved in the electricity
generation, energy trading and ancillary services.
The contribution of the Russian companies to the main consolidated performance aggregates in 2021
(considering the average 2021 euro/ruble exchange rate of 87.18) is not significant and includes
revenue of 564 million (0.6% of the total consolidated revenue of the Enel Group), operating profit
of 51 million (0.7% of total Enel Group operating profit) and profit of 64 million (2.0% of Enel Group
profit).
No assets are held by the Enel Group in Ukraine and Belarus.
The Enel Group has activated a task force to carefully monitor macroeconomic and business variables
in order to develop the most accurate real-time estimates of impacts connected with regulatory
changes, sanctions and restrictions on assets, as well as on suppliers and contracts applicable to the
Enel Group, taking due account of the recommendations issued by national and supranational
organizations on this issue.
The Company has no operations with Enel subsidiaries in Russia and has no other direct exposure in
respect of Russia, Ukraine or Belarus.
Further escalation of the conflict may have indirect consequences for the Company, which are difficult
to quantify but the Company is paying appropriate attention to the developments.
Amsterdam, 29 April 2022
E. Di Giacomo
A. Canta
H. Marseille
A.J.M. Nieuwenhuizen


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Other information
Provisions in the articles of association governing the appropriation of profit
Under article 16 of the Company’s articles of association, the profit is at the disposal of the General
Meeting of Shareholders, which can allocate said profit either wholly or partly to the formation of – or
in addition to – one or more general or special reserve funds.
The Company can only make distributions to shareholders from profits qualifying for payment insofar
as the shareholders’ equity is greater than the paid-up and called-up part of the capital plus the legally
required reserves.


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/
Report of the independent auditor
Report of the independent audit
firm on the 2021 financial statements of
Enel Financial International BV
The auditor’s report is set forth on the following page.


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KPMG Accountants N.V., a Dutch limited liability company registered with the trade register in the Netherlands under number 33263683, is a member firm of the global organization of
independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.


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Independent auditor's report


To: the General Meeting of Shareholders of ENEL Finance International N.V. and the Audit
Committee of ENEL S.p.A.
Report on the audit of the financial statements 2021 included in the annual report
Our opinion
In our opinion the accompanying financial statements give a true and fair view of the financial
position of ENEL Finance International N.V. as at 31 December 2021 and of its result and its
cash flows for the year then ended, in accordance with International Financial Reporting
Standards as adopted by the European Union (EU-IFRS) and with Part 9 of Book 2 of the Dutch
Civil Code.
What we have audited
We have audited the financial statements 2021 of ENEL Finance International N.V. based in
Amsterdam.
The financial statements comprise:
1 the statement of financial position as at 31 December 2021;
2 the statement of comprehensive income for the year ended 31 December 2021;
3 the statement of changes in equity for the year ended 31 December 2021;
4 the statement of cash flows for the year ended 31 December 2021; and
5 the notes comprising a summary of the significant accounting policies and other explanatory
information.


Basis for our opinion
We conducted our audit in accordance with Dutch law, including the Dutch Standards on
Auditing. Our responsibilities under those standards are further described in the ‘Our
responsibilities for the audit of the financial statements’ section of our report.
We are independent of ENEL Finance International N.V. in accordance with the Verordening
inzake de onafhankelijkheid van accountants bij assurance-opdrachten(ViO, Code of Ethics for
Professional Accountants, a regulation with respect to independence) and other relevant
independence regulations in the Netherlands. Furthermore, we have complied with the
Verordening gedrags- en beroepsregels accountants(VGBA, Dutch Code of Ethics).


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Our audit procedures were determined in the context of our audit of the financial statements as a
whole. Our observations in respect of going concern, fraud and non-compliance with laws and
regulations and the key audit matters should be viewed in that context and not as separate
opinions or conclusions.
We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.


Audit approach
Summary
Materiality
Materiality of EUR 287 million
0,75% of Total Assets


Going concern and Fraud/Noclar
Going concern: no significant going concern risk identified
Fraud & Non-compliance with laws and regulations (Noclar): management override of
controls


Key audit matter
Recoverability of the long-term and short-term loans and financial receivables due from
ENEL S.p.A. (parent company) and the ENEL S.p.A. group companies


Opinion
Unqualified
Materiality
Based on our professional judgement we determined the materiality for the financial statements
as a whole at EUR 287 million (2020: EUR 295 million). The materiality is determined with
reference to 0,75% of total assets. We consider total assets, which mainly include accounts
related to financing activities, as an appropriate benchmark given the activities of ENEL Finance
International N.V. as a group financing company. We have also taken into account
misstatements and/or possible misstatements that in our opinion are material for the users of the
financial statements for qualitative reasons.




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We agreed with the Board of Directors of ENEL Finance International N.V. and the Audit
Committee of the ultimate parent company, ENEL S.p.A., that misstatements identified during
our audit in excess of EUR 14.3 million, would be reported to them as well as smaller
misstatements that in our view must be reported on qualitative grounds.
Audit response to going concern no significant going concern risks identified
As explained on page 28 of the financial statements, the Management Board has performed its
going concern assessment, in which amongst others, the Company’s high dependency of the
parent company’s and group companies’ ability to fulfill its obligations towards the Company was
considered, and has not identified any going concern risk.
To assess the Board of Directors’ assessment, we performed, inter alia, the following
procedures:
We considered whether the Board of Directors’ assessment of the going concern risks
includes all relevant information of which we are aware as a result of our audit;
We considered whether (new) strategic decisions and targets, developments in the electricity
industry, and evolution of recent geopolitical events indicate a significant going concern risk;
We inspected the (new) financing agreements in terms of conditions that could lead to
significant going concern risks, including the term of the agreement and we did not identify
specific financial covenants;
We analysed the Company’s financial position, result of the year and cashflow as at year-end
and compared it to the previous financial year in terms of indicators that could identify
significant going concern risks;
Considering the Group is guarantor for the bonds issued by the Company, through inspection
of audited consolidated financial statement as of 31 December 2021, we verified the going
concern basis of the Group as a whole;
We considered whether the outcome of our audit procedures to determine the recoverability
of the intercompany loans, as described in the key audit matter on recoverability of loans,
could indicate a significant going concern risk.


The outcome of our risk assessment procedures did not give reason to perform additional audit
procedures on the Board of Directors’ going concern assessment.


Audit response to the risk of fraud and non-compliance with laws and regulations
In the paragraph “Main risk and uncertainties” of the Directors’ report, the directors describe the
procedures in respect of the risk of fraud and non-compliance with laws and regulations.
As part of our audit, we gained insight into the Company and its business environment, and
assessed the design and implementation of the Company’s risk management in relation to fraud
and non-compliance.


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Our procedures included, among other things, assessing the Company’s code of ethics,
whistleblowing procedures, and its procedures to investigate indications of possible fraud and
non-compliance. Furthermore, we performed relevant inquiries with management and those
charged with governance.
In addition, we performed procedures to obtain an understanding of the legal and regulatory
frameworks that are applicable to the Company and did not identify areas that likely have a
material effect on the financial statements.
We evaluated the fraud and non-compliance risk factors to consider whether those factors by
themselves would cause the existence of a reasonable possibility of a risk of material
misstatement in the financial statements.
Further we assessed the presumed fraud risk on revenue recognition as irrelevant, since the
Company’s sole significant source of income is finance income. Such finance income is derived
from long- and short-term loan agreements with the parent Company and with the group
companies including fixed terms and conditions in respect of interest. As a consequence, we did
not identify an incentive nor pressure for the Management Board members to achieve certain
results or specific finance income targets and there appears to be limited perceived opportunity
to commit a material fraud in this area.
Based on the above and the relevant auditing standards, we identified the following presumed
fraud risk in respect of management override of controls that is relevant to our audit and
responded as follows:
Management override of controls (a presumed risk)
Risk:
- Management is in a unique position to manipulate accounting records and prepare
fraudulent financial statements by overriding controls that otherwise appear to be
operating effectively such as: accounting records around the estimate related to the
recoverability of loans (principle and interest) receivable from related parties.
Response:
We evaluated the design and the implementation of internal controls that mitigate fraud
and non-compliance risks, such as processes related to journal entries and estimates;
We performed a data analysis of journal entries to determine any potential high risk
criteria and performed procedures for any identified risk;
We involved a specialist to challenge the assumptions underlying the fair value of the
derivatives and the valuation assessment of loans and interest receivables from the
parent Company and other ENEL S.p.A. group companies. The latter is considered a key
audit matter and we refer to the procedures performed to the KAM paragraph below;


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- We incorporated elements of unpredictability in our audit, including the review of the
authorization and related internal policy of expense reports submitted by senior
management and Board of Directors
Our procedures to address the identified risk of fraud in respect of management override of
controls did not result in any other key audit matter.
We communicated our risk assessment, audit responses and results to the Management Board
and the Audit Committee (of ENEL S.p.A.).
Our audit procedures did not reveal indications and/or reasonable suspicion of fraud and non-
compliance that are considered material for our audit.
Our key audit matter
Key audit matters are those matters that, in our professional judgement, were of most
significance in our audit of the financial statements. We have communicated the key audit matter
to the to the Board of Directors of ENEL Finance International N.V. and the Audit Committee of
ENEL S.p.A. The key audit matter is not a comprehensive reflection of all matters discussed.












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Recoverability of the long-term and short-term loans and financial receivables due from ENEL S.p.A. (parent
Company) and the ENEL S.p.A. group companies
Description
As included in note 6 and 9 to the financial statements, the Company’s exposure, in terms of
credit risk, to group companies may have a significant effect on the Company’s financial
statements. The outstanding balances at 31 December 2021 of EUR 48,366 million
(EUR 35,052 million in 2020) (long-term and short-term loans and financial receivables, net of
the impairment loss allowance of EUR 53 million (EUR 38 million as at 31 December 2020)
represent approx. 97% (2020: approx. 95%) oof the balance sheet total.
The Company’s most significant assets are the long-term and short-term loans and financial
receivables due from ENEL S.p.A. and/or the ENEL S.p.A. group companies. In the event that
ENEL S.p.A. and/or group companies can no longer fulfill their financial obligations towards
the Company this would have a significant impact on the Company. The Company’s ability to
meet its financial obligations depends on the cash flows generated from the repayment of
(accrued) interest and principal by ENEL S.p.A. and/or ENEL S.p.A. group companies. Current
and future developments of the COVID-19 outbreak are merely examples of factors that can
impact the Company’s ability to meet its financial obligations.
The Company records the long-term and short-term loans and financial receivables, net of the
impairment loss allowance, which is done by estimating intercompany Probability of Default
(PD) and Loss Given Default (LGD) on the basis of the creditworthiness of ENEL S.p.A. and/or
ENEL S.p.A. group companies and the applicable market data.
As the long-term and short-term loans and financial receivables from ENEL S.p.A. and/or
ENEL S.p.A. group companies are material to the Company’s balance sheet and given the
related estimation uncertainty on impairment losses, the risk of a financial loss of the Company
is significant when ENEL S.p.A. and/or ENEL S.p.A. group companies fail to meet their
contractual obligations towards the Company. We therefore consider the valuation on the long-
term and short-term loans and financial receivables provided to the ENEL S.p.A. and/or ENEL
S.p.A. group companies to be a key audit matter.




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Our response
We evaluated the design and implementation of the controls regarding the valuation
assessment by the Board of Directors in respect to the long-term and short-term loans and
financial receivables.
We performed, amongst others, the following procedures with respect to management’s
assessment of the recoverability of the long-term and short-term loans and financial
receivables from the ENEL S.p.A. and/or ENEL S.p.A. group companies:
We inquired with the Board of Directors of the Company about their assessment of the
valuation of the long-term and short-term loans and financial receivables, based upon their
knowledge of the developments in the financial position and cash flows of ENEL S.p.A.
and/or ENEL S.p.A. group companies considering among others the impact, if any, of the
COVID-19 pandemic, and about their evaluation with respect to the recoverability of the
long-term and short-term loans and financial receivables from ENEL S.p.A. and/or ENEL
S.p.A. group companies;
We inspected and analysed ENEL S.p.A.’s financial position by evaluating its audited
consolidated financial figures for the year 2021. Furthermore, we inquired the auditor of
ENEL S.p.A. and/or ENEL S.p.A. group companies with respect to their going concern
evaluation;
We inspected the terms and conditions of the loan agreements between ENEL S.p.A. and
certain ENEL S.p.A. group companies and the Company;
We involved a specialist in evaluating the reasonableness of the Board of Directors’ key
judgements and estimates in relation to Probability of Default (PD) and Loss Given Default
(LGD) made in respect of IFRS 9, including selection of methods, models, assumptions
and data sources;
We evaluated the long-term credit ratings and outlook of ENEL S.p.A., from Standard &
Poor’s, Fitch and Moody’s;
In addition, we evaluated the appropriateness of the accounting principles applied based
on IFRS 9’s requirements and the adequacy of the Company’s related disclosures as
presented in the notes to the financial statements.


Our observation
The results of our audit procedures relating to the valuation of the long-term and short-term
loans and financial receivables from ENEL S.p.A. and/or ENEL S.p.A. group companies were
satisfactory and we consider the disclosures relating to credit risk as included in the credit risk
paragraph on pages 42-44 and Notes 6 and 9 of the financial statements to be adequate.








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Report on the other information included in the annual report
In addition to the financial statements and our auditor’s report thereon, the annual report
contains other information.
Based on the following procedures performed, we conclude that the other information:
is consistent with the financial statements and does not contain material misstatements; and
contains the information as required by Part 9 of Book 2 of the Dutch Civil Code for the
management report and other information.
We have read the other information. Based on our knowledge and understanding obtained
through our audit of the financial statements or otherwise, we have considered whether the other
information contains material misstatements.
By performing these procedures, we comply with the requirements of Part 9 of Book 2 of the
Dutch Civil Code and the Dutch Standard 720. The scope of the procedures performed is less
than the scope of those performed in our audit of the financial statements.
The Board of Directors is responsible for the preparation of the other information, including the
information as required by Part 9 of Book 2 of the Dutch Civil Code.
Report on other legal and regulatory requirements and ESEF
Engagement
We were engaged by the General Meeting of Shareholders as auditor of ENEL Finance
International N.V. on 20 May 2020, as of the audit for the year 2020 and have operated as
statutory auditor ever since that financial year.
No prohibited non-audit services
We have not provided prohibited non-audit services as referred to in Article 5(1) of the EU
Regulation on specific requirements regarding statutory audits of public-interest entities.
Services rendered
For the period to which our statutory audit relates, in addition to this audit, we have provided the
following services to the ENEL Finance International N.V. and its controlled undertakings:
Issuance of Consent letter
European Single Electronic Format (ESEF)
ENEL Finance International N.V. has prepared its annual report in ESEF. The requirements for
this format are set out in the Commission Delegated Regulation (EU) 2019/815 with regard to
regulatory technical standards on the specification of a single electronic reporting format (these
requirements are hereinafter referred to as: the RTS on ESEF”).


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In our opinion, the annual report prepared in XHTML format, including the financial statements of
ENEL Finance International N.V., has been prepared in all material respects in accordance with
the RTS on ESEF.
Management is responsible for preparing the annual report including the financial statements, in
accordance with the RTS on ESEF. Our responsibility is to obtain reasonable assurance for our
opinion whether the annual report is in accordance with the RTS on ESEF.
Our procedures, taking into consideration Alert 43 of NBA (the Netherlands Institute of Chartered
Accountants), included amongst others:
obtaining an understanding of the entity's financial reporting process, including the
preparation of the annual financial report in XHTML-format;
examining whether the annual report in XHTML-format is in accordance with the RTS on
ESEF.
Description of responsibilities regarding the financial statements
Responsibilities of the Board of Directors of ENEL Finance N.V. and the Audit
Committee of ENEL S.p.A. for the financial statements
The Board of Directors is responsible for the preparation and fair presentation of the financial
statements in accordance with EU-IFRS and Part 9 of Book 2 of the Dutch Civil Code.
Furthermore, the Board of Directors is responsible for such internal control as management
determines is necessary to enable the preparation of the financial statements that are free from
material misstatement, whether due to fraud or error. In that respect the Board of Directors,
under supervision of the the Audit Committee of ENEL S.p.A., is responsible for the prevention
and detection of fraud and non-compliance with laws and regulations, including determining
measures to resolve the consequences of it and to prevent recurrence.
As part of the preparation of the financial statements, the Board of Directors is responsible for
assessing the Company’s ability to continue as a going concern. Based on the financial reporting
frameworks mentioned, the Board of Directors should prepare the financial statements using the
going concern basis of accounting unless the Board of Directors either intends to liquidate the
Company or to cease operations, or has no realistic alternative but to do so. The Board of
Directors should disclose events and circumstances that may cast significant doubt on the
Company’s ability to continue as a going concern in the financial statements.
The Audit Committee of ENEL S.p.A. is responsible for overseeing the Company’s financial
reporting process.
Our responsibilities for the audit of the financial statements
Our objective is to plan and perform the audit engagement in a manner that allows us to obtain
sufficient and appropriate audit evidence for our opinion.
Our audit has been performed with a high, but not absolute, level of assurance, which means we
may not detect all material errors and fraud during our audit.


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Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users
taken on the basis of these financial statements. The materiality affects the nature, timing and
extent of our audit procedures and the evaluation of the effect of identified misstatements on our
opinion.
A further description of our responsibilities for the audit of the financial statements is located at
the website of the ‘Koninklijke Nederlandse Beroepsorganisatie van Accountants’ (NBA, Royal
Netherlands Institute of Chartered Accountants) at eng_oob_01.pdf
(nba.nl)/eng_beursgenoteerd_01.pdf (nba.nl). This description forms part of our auditor’s report.
Amstelveen, 29 April 2022
KPMG Accountants N.V.
L.M.A. van Opzeeland RA