Slide 1: 9M 2016 Financial Results
9M 2016 Financial Results Milan – November 8th, 2016
Slide 2: Agenda
Agenda 9M 2016 Highlights o Group overview o Results by business o Outlook Financial results Appendix 9M 2016 Financial Results 2
Slide 3: 9M 2016 Highlights
9M 2016 Highlights Adj. EBITDA at € 527m (9.3% on Sales), with margin expansion in all businesses, except O&G. Continued focus on cost efficiency with relevant progress in manufacturing footprint optimization. +1.8% Organic Growth, driven by solid trends in the Telecom business and sound execu
Slide 4: 9M 2016 Key Financials
9M 2016 Key Financials Euro Millions, % on Sales Sales Adjusted EBITDA (1) **∆ OCI Contribution 9M’16 vs. 9M’15 * Excl. €24m WL previous loss write-up 7,361 **∆ OCI Contribution 9M’16 vs. 9M’15 +1.8%* 623 527 5,569 5,660 473 28** 403** 449* 8.5% 8.5% 9.3% 2015 9M '15 9M '16 2015 9M '15 9M '16 * Org.
Slide 5: Continued profitability improvement
Continued profitability improvement Underlying margin increase in all business excluding Oil&Gas 9M’15 9M’16 * Excl. €24m WL provision write-up ** Excl. €8m bad debt provision Adj. EBITDA Margin 15.8%** 15.4% 14.6% 12.6% ~13%* 9.3% 14.9% 9.3% 8.1% 8.5% 6.2% 4.5% 5.4% 4.1% 8.1%* Energy Industrial Pro
Slide 6: Production capacity rationalization in progress
Production capacity rationalization in progress. 15 plants closed to date since Draka acquisition, 2 closure ongoing: improve saturation in Europe 15 Plants Closed Since Draka Acquisition: St.Petersburg (RUS) • At 31 Dec 2010 (pro-forma): 98 Plants Delfzijl (NED) • Today: 85 Plants (including OCI’s
Slide 7: Agenda
Agenda 9M 2016 Highlights o Group overview o Results by business o Outlook Financial results Appendix 9M 2016 Financial Results 7
Slide 8: Energy Projects
Energy Projects Euro Millions, % on Sales Sales Highlights 1,416 +20.9%* Submarine 1,172 • Strong revenue growth driven by solid execution and favourable project 993 phasing in the first 9M. • Recent investments in execution capabilities and installation assets start paying-off, as shown by the shar
Slide 9: Energy & Infrastructure
Energy & Infrastructure Euro Millions, % on Sales Sales Highlights **∆ OCI Contribution 9M’16 vs. 9M’15 Trade & Installers 2,795 -1.9%* • Negative organic trend with an improving Adj. EBITDA margin thanks to 2,300 OCI consolidation, better mix and footprint optimization. 2,175 403** • Organic declin
Slide 10: Industrial & Network Components
Industrial & Network Components Euro Millions, % on Sales Sales Highlights 1,499 -2.5%* Specialties & OEMs • Negative organic sales in the first 9M driven by soft start in Renewables 1,137 1,021 (mainly in China) and market slowdown in Nuclear, Crane and Mining, partially offset by solid performance
Slide 11: Oil & Gas
Oil & Gas Euro Millions, % on Sales Sales Highlights 421 SURF -31.6%* • Umbilical: Volumes and profitability evolution in line with expectations, 331 reflecting the updated (new contractual terms) framework agreement in Brazil. 225 • DHT: Results in line with 9M 2015 benefitting from the full impact
Slide 12: Telecom
Telecom Euro Millions, % on Sales Sales Highlights 1,109 Telecom Solutions +8.4%* • Growth in optical cables and fiber businesses, with a continued solid 865 trend in Australia, US and France. 847 • Sharp margin expansion (also considering the €8mln bad-debt provision) fuelled by fiber manufacturing
Slide 13: Agenda
Agenda 9M 2016 Highlights o Group overview o Results by business o Outlook Financial results Appendix 9M 2016 Financial Results 13
Slide 14: FY 2016 Outlook
FY 2016 Outlook Margin improvement mainly driven by Energy Projects and Telecom. Negative FX. 2016 Adj.EBITDA Target (€ million)* 2016 Adj.EBITDA Target Assumptions (€ million) Above mid-point target assumptions: • Solid execution in Energy Projects 670 Mid-point Mid-point € 695m 720 • Strong market
Slide 15: Agenda
Agenda 9M 2016 Highlights o Group overview o Results by business o Outlook Financial results Appendix 9M 2016 Financial Results 15
Slide 16: Profit and Loss Statement
Profit and Loss Statement Euro Millions ∆ OCI contrib. 9M 2016 9M 2015 9M ‘16 vs. 9M ’15 Sales 5,660 5,569 403 YoY total growth 1.6% 0.0% YoY organic growth 1.8% 0.0% Adj.EBITDA 527 473 28 % on sales 9.3% 8.5% Adjustments (39) (28) (5) EBITDA 488 445 23 % on sales 8.6% 8.0% Adj.EBIT 398 364 8 % on s
Slide 17: Adjustments and Special Items on EBIT
Adjustments and Special Items on EBIT Euro Millions 9M 2016 9M 2015 Non-recurring Items (Antitrust Investigation) - 21 Restructuring (27) (32) Other Non-operating Income / (Expenses) (12) (17) EBITDA adjustments (39) (28) Special items (26) (52) Gain/(loss) on metal derivatives 24 (29) Assets impair
Slide 18: Financial Charges
Financial Charges Euro Millions 9M 2016 9M 2015 Net interest expenses (44) (59) of which non-cash conv.bond interest exp. (6) (6) Bank fees amortization (2) (3) Gain/(loss) on exchange rates - (30) Gain/(loss) on derivatives 1) (11) 19 Non recurring effects (2) (3) Other 1 (1) Net financial charges
Slide 19: Statement of financial position (Balance Sheet)
Statement of financial position (Balance Sheet) Euro Millions 30 Sep 2016 New Perimeter 30 Sep 2015 31 Dec 2015* Acquired Net fixed assets 2,578 350 2,224 2,581 of which: goodwill 442 67 381 452 of which: intangible assets 339 192 164 371 of which: property, plants & equipment 1,580 91 1,418 1,552 N
Slide 20: Cash Flow
Cash Flow Euro Millions 9M 2016 9M 2015 Adj.EBITDA 527 473 Adjustments (39) (28) EBITDA 488 445 Net Change in provisions & others (12) (41) Share of income from investments in op.activities (24) (27) Cash Flow from operations (bef. WC changes) 452 377 Working Capital changes (342) (198) Dividends re
Slide 21: Agenda
Agenda 9M 2016 Highlights o Group overview o Results by business o Outlook Financial results Appendix 9M 2016 Financial Results 21
Slide 22: Bridge Consolidated Sales
Bridge Consolidated Sales Euro Millions Energy Projects E&I Industrial & NWC (8 ) (20 ) ( 28) ( 62 ) 207 (42 ) (26 ) (150 ) 403 ( 86 ) Org.growth 1,172 -2.5% 2,300 1,137 2,175 Org.growth 1,021 Org.growth 1,897 993 -1.9% +20.9% Oil & Gas Telecom Total Consolidated ( 15 ) ( ) 101 ( 71 33 ( 5) 245 ) 41
Slide 23: Profit and Loss Statement
Profit and Loss Statement Euro Millions ∆ OCI contrib. Full OCI 9M’16 9M 2016 9M 2015 9M‘16 vs. 9M’15 Results Sales 5,660 5,569 403 403 YoY total growth 1.6% 0.0% 0.0% YoY organic growth 1.8% 0.0% 0.0% Adj.EBITDA 527 473 28 39 % on sales 9.3% 8.5% 0.0% 9.7% of which share of net income 24 27 - 0 Adj
Slide 24: Energy Projects Segment – Profit and Loss Statement
Energy Projects Segment – Profit and Loss Statement Euro Millions 9M 2016 9M 2015 Sales to Third Parties 1,172 993 YoY total growth 18.0% 0.0% YoY organic growth 20.9% 0.0% Adj. EBITDA 172 153 % on sales 14.6% 15.4% Adj. EBIT 146 131 % on sales 12.4% 13.1% 9M 2016 Financial Results 24
Slide 25: Energy Products Segment – Profit and Loss Statement
Energy Products Segment – Profit and Loss Statement Euro Millions ∆ OCI Contribution 9M 2016 9M 2015 9M ‘16 vs. 9M ’15 E&I 2,300 2,175 403 YoY total growth 5.8% 0.0% 0.0% Sales to Third Parties YoY organic growth (1.9%) 0.0% 0.0% Industrial & Netw. Comp. 1,021 1,137 - YoY total growth (10.2%) 0.0% 0
Slide 26: Oil&Gas Segment – Profit and Loss Statement
Oil&Gas Segment – Profit and Loss Statement Euro Millions 9M 2016 9M 2015 Sales to Third Parties 225 331 YoY total growth (31.8%) 0.0% YoY organic growth (31.6%) 0.0% Adj. EBITDA 9 21 % on sales 4.1% 6.2% Adj. EBIT (2) 12 % on sales (1.0%) 3.7% 9M 2016 Financial Results 26
Slide 27: Telecom Segment – Profit and Loss Statement
Telecom Segment – Profit and Loss Statement Euro Millions 9M 2016 9M 2015 Sales to Third Parties 865 847 YoY total growth 2.2% YoY organic growth 8.4% Adj. EBITDA 129 106 % on sales 14.9% 12.6% Adj. EBIT 99 73 % on sales 11.4% 8.6% 9M 2016 Financial Results 27
Slide 28: 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 2,500 100 8,000 2,000 75 6,000 1,500 50 4,000 1,000 25 2,000 500 J-08 J-09 J-10 J-11 J-12 J-13 J-14 J-15 J-16 J-08 J-09 J-
Slide 29: 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