Prysmian S.p.a. · MIL:PRY
Prysmian — FY2017 Earnings Presentation
37 slides from Prysmian's earnings presentation, Feb 27, 2018
Slide 1: FY 2017 Financial Results
FY 2017 FINANCIAL RESULTS Milan – February 27th, 2018 1
Slide 2: Agenda
AGENDA ➢FY 2017 Highlights o Group overview o Results by business ➢Financial results ➢Appendix 2
Slide 3: Key Achievements of 2017
Key Achievements of 2017 General Cable Leadership in Expansion in Acquisition Submarine Telecom • High geographical and • ~€ 1bn order intake in 2017 • Double-digit organic growth business complementarity. in Optical Telecom business. • Key contracts: • Multisource synergies. - IFA2 (France-UK) • Ad
Slide 4: FY 2017 Financial Highlights
FY 2017 Financial Highlights Margin increase in core businesses Telecom and Energy Projects. Organic sales growth at -0.1%, with a positive trend in Q4 (+2.9%), supported by: - Double-digit progress in Optical & Connectivity. - Gradual recovery in E&I and Industrial. Adj. EBITDA at € 733m (9.3% of s
Slide 5: FY 2017 Key Financials
FY 2017 Key Financials Euro Millions, % on Sales Sales Adjusted EBITDA (1) -0.1%* 9.4% 9.3% (1) Adjusted excluding restructuring, non-operating income/expenses and non-recurring * Org. Growth income / expenses and cost for acquisition of General Cable; Operative Net Working Capital (2) Net Financial
Slide 6: Continued profitability improvement
Continued profitability improvement Further margin expansion in Energy Projects and Telecom businesses. FY’16 FY’17 Adj. EBITDA Margin 17.8% 17.0% 15.9% 14.0% 9.5% 7.9% 9.4% 9.3% 5.1% 4.0% 3.4% 2.7% Energy Industrial Telecom Total E&I Oil&Gas Projects & NWC. FY’16 FY’17 ±X.X% = Sales Organic Trend -
Slide 7: General Cable Acquisition
General Cable Acquisition Update of the transaction agenda Key Milestones of the Transaction December 4th, • Transaction Announcement √ 2017 • General Cable EGM approved the acquisition by large February 16th, majority (99% of total votes cast, also representing √ 2018 a majority of the total outsta
Slide 8: Capital Increase
Capital Increase Key Highlights • Prysmian’s BoD has decided to request the forthcoming General Meeting for authorization to launch a capital increase up to € 500 millions. • The launch is conditioned to the completion of the General Cable transaction. Maximum € 500 millions Amount Timing After clos
Slide 9: Agenda
AGENDA ➢FY 2017 Highlights o Group overview o Results by business ➢Financial results ➢Appendix 9
Slide 10: Energy Projects
Energy Projects Euro Millions, % on Sales Sales Highlights +18.5%* -4.8%* SUBMARINE • Sound order intake in FY2017 of approximately € 1 billion confirming the undisputed leadership in Submarine market. Strong tendering activity in the months ahead. • Adj.EBITDA margin growth underpinned by the highe
Slide 11: Energy & Infrastructure
Energy & Infrastructure Euro Millions, % on Sales Sales Highlights -3.1%* -0.2% * TRADE & INSTALLERS • Significant organic recovery in H2, also benefitting from CPR introduction which positively impacted performance in some European countries (Italy, Spain, Netherlands and the Nordics). • Weakness i
Slide 12: Industrial & Network Components
Industrial & Network Components Euro Millions, % on Sales Sales Highlights -4.6% * +3.5%* Specialties, OEMs & Renewables • Positive organic growth, improving in Q4 thanks to solid trend in Railways and Infrastructure, partially offset by the slowdown in Renewables, Defense and Crane. Adverse mix eff
Slide 13: Oil & Gas
Oil & Gas Euro Millions, % on Sales Sales Highlights -29.3%* SURF -10.8%* • Umbilical: volume and margin decline due to low level of order intake in 2016 and price pressure. Brazil market conditions remain highly competitive. • DHT: moderate reduction due to low level of activity in international &
Slide 14: Telecom
Telecom Euro Millions, % on Sales Sales Highlights +5.3% * Telecom Solutions & Fibre +8.5%* • Optical business expanded double-digit organically supported by the favorable market environment, driven by fixed broadband expansion and investments preparing the 5G. Main growth areas were Europe (France
Slide 15: Agenda
AGENDA ➢ FY 2017 Highlights o Group overview o Results by business ➢ Financial results ➢Appendix 15
Slide 16: Profit and Loss Statement
Profit and Loss Statement Euro Millions FY 2017 FY 2016 Sales 7,901 7,567 YoY total growth 4.4% 2.8% YoY organic growth (0.1%) 1.0% Adj.EBITDA 733 711 % on sales 9.3% 9.4% Adjustments (76) (66) EBITDA 657 645 % on sales 8.3% 8.5% Adj.EBIT 556 538 % on sales 7.0% 7.1% Adjustments (76) (66) Special it
Slide 17: Adjustments and Special Items on EBIT
Adjustments and Special Items on EBIT Euro Millions FY 2017 FY 2016 Non-recurring Items (Antitrust investigation) (18) 1 Restructuring (30) (50) Acquisition General Cable (16) - Other Non-operating Income / (Expenses) (12) (17) EBITDA adjustments (76) (66) Special items (59) (25) Gain/(loss) on meta
Slide 18: Financial Charges
Financial Charges Euro Millions FY 2017 FY 2016 Net interest expenses (70) (62) of which non-cash conv.bond interest exp. (17) (8) Bank fees amortization (5) (4) Gain/(loss) on exchange effect (5) - Hedging costs (15) (12) Hedging costs for GC acquisition (17) - Non recurring effects (2) (2) Other n
Slide 19: Statement of financial position (Balance Sheet)
Statement of financial position (Balance Sheet) Euro Millions 31 Dec 2017 31 Dec 2016 Net fixed assets 2,610 2,630 of which: goodwill 438 448 of which: intangible assets 297 344 of which: property, plants & equipment 1,646 1,631 Net working capital 178 325 of which: derivatives assets/(liabilities)
Slide 20: Cash Flow
Cash Flow Euro Millions FY 2017 FY 2016 Adj.EBITDA 733 711 Adjustments (76) (66) EBITDA 657 645 Net Change in provisions & others (2) - Share of income from investments in op.activities (42) (31) Cash flow from operations (before WC changes) 613 614 Working Capital changes 88 67 Dividends received 1
Slide 21: Dividend proposal
Dividend proposal Dividend proposed to the forthcoming Shareholders’ Meeting Dividend Per Share € 0.43 • Ex-dividend date: 23 April 2018 Dividend Yield (1) • Record date: 24 April 2018 • Payment date: 25 April 2018 1.6% DPS evolution (Euro per share) Draka acquisition 0.417 0.417 0.417 0.42 0.42 0.4
Slide 22: Agenda
AGENDA ➢ FY 2017 Highlights o Group overview o Results by business ➢Financial results ➢ Appendix 22
Slide 23: Prysmian group at a glance
Prysmian group at a glance FY 2017 Financial Results Sales breakdown by business Sales breakdown by geography € 7,901m € 7,901 m Energy Products 62% Adj. EBITDA by business Adj. EBITDA margin 17.8% 17.0% 9.3% € 733 m 7.9% 4.0% 3.4% Energy E&I Industrial Oil&Gas Telecom Total Projects & Netw. Comp. 2
Slide 24: Energy Projects
Energy Projects FY2017 sales breakdown Sales breakdown by business Sales breakdown by geography € 1,490 m € 1,490 m 24
Slide 25: E&I FY2017 sales breakdown
E&I FY2017 sales breakdown Sales breakdown by business Sales breakdown by geography € 3,271 m € 3,271 m 25
Slide 26: Industrial & Network Components
Industrial & Network Components FY2017 sales breakdown Sales breakdown by business Sales breakdown by geography € 1,460 m € 1,460 m 26
Slide 27: Oil & Gas
Oil & Gas FY2017 sales breakdown Sales breakdown by business Sales breakdown by geography € 273 m € 273 m 27
Slide 28: Telecom
Telecom FY2017 sales breakdown Sales breakdown by business Sales breakdown by geography € 1,258 m € 1,258 m 28
Slide 29: Bridge Consolidated Sales
Bridge Consolidated Sales Euro Millions Energy Projects E&I Industrial & NWC ( 78 ) 9 ( 15 ) ( 74 ) ( 32 ) 102 ( 60 ) 335 47 ( 6) 1,634 Org.growth -4.8% 3,271 1,460 Org.growth 1,490 1,490 3,016 Org.growth 1,343 +3.5% -0.2% Oil & Gas Telecom Total Consolidated (8 ) 15 (138 ) 25 ( 45 ) ( 33 ) 13 (7 )
Slide 30: Profit and Loss Statement
Profit and Loss Statement Euro Millions FY 2017 FY 2016 Sales 7,901 7,567 YoY total growth 4.4% 2.8% YoY organic growth (0.1%) 1.0% Adj.EBITDA 733 711 % on sales 9.3% 9.4% of which share of net income 42 31 Adjustments (76) (66) EBITDA 657 645 % on sales 8.3% 8.5% Adj.EBIT 556 538 % on sales 7.0% 7.
Slide 31: Energy Projects Segment – Profit and Loss Statement
Energy Projects Segment – Profit and Loss Statement Euro Millions FY 2017 FY 2016 Sales to Third Parties 1,490 1,634 YoY total growth (8.8%) YoY organic growth (4.8%) Adj. EBITDA 266 260 % on sales 17.8% 15.9% Adj. EBIT 225 224 % on sales 15.1% 13.7% 31
Slide 32: Energy Products Segment – Profit and Loss Statement
Energy Products Segment – Profit and Loss Statement Euro Millions FY 2017 FY 2016 E&I 3,271 3,016 YoY total growth 8.5% Sales to Third Parties YoY organic growth (0.2%) Industrial & Netw. Comp. 1,460 1,343 YoY total growth 8.8% YoY organic growth 3.5% Other 149 110 YoY total growth 34.8% YoY organic
Slide 33: Oil&Gas Segment – Profit and Loss Statement
Oil&Gas Segment – Profit and Loss Statement Euro Millions FY 2017 FY 2016 Sales to Third Parties 273 300 YoY total growth (9.0%) YoY organic growth (10.8%) Adj. EBITDA 9 8 % on sales 3.4% 2.7% Adj. EBIT (7) (7) % on sales (2.5%) (2.4%) 33
Slide 34: Telecom Segment – Profit and Loss Statement
Telecom Segment – Profit and Loss Statement Euro Millions FY 2017 FY 2016 Sales to Third Parties 1,258 1,164 YoY total growth 8.1% YoY organic growth 5.3% Adj. EBITDA 214 163 % on sales 17.0% 14.0% Adj. EBIT 173 123 % on sales 13.8% 10.6% 34
Slide 35: IFRS 15
IFRS 15 New International Standard that regulates revenue recognition. Key Highlights & Impact • Effective for annual periods beginning after 1st January 2018; • Prysmian Group will apply the IFRS 15 standard using the full retrospective method; • The implementation of IFRS 15 standard will not have
Slide 36: Reference Scenario
Reference Scenario Commodities & Forex Brent Copper Aluminium Brent $/bbl Copper $/ton Aluminium $/ton Brent €/bbl Copper €/ton Aluminium €/ton 150 12,000 3,500 125 10,000 3,000 8,000 2,500 100 2,000 75 6,000 1,500 50 4,000 1,000 25 2,000 J- J- J- J- J- J- J- J- J- J- 500 J- J- J- J- J- J- J- J- J-
Slide 37: Disclaimer
Disclaimer • The managers responsible for preparing the company's financial reports, A.Bott and C.Soprano, declare, pursuant to paragraph 2 of Article 154-bis of the Consolidated Financial Act, that the accounting information contained in this presentation corresponds to the results documented in th