Nexans Sa · EURONEXT:NEX

Nexans Sa — Debt Investor Presentation (February 2024)

46 slides from Nexans Sa's debt investor presentation, Feb 19, 2024

Slide 1: 2024 Fixed Income Roadshow
2024 Fixed Income Roadshow FY2023 – ROBUST PERFORMANCE Jean-Christophe Juillard, Deputy CEO & CFO Benoit Cuignet, VP Treasury & Financing Elodie Robbe-Mouillot, VP Investors Relations Marine Penicaut, Group Financing Director February 19&20, 2024 – Paris & London
Slide 2: Safe Harbour
2024 FIXED INCOME INVESTOR PRESENTATION #1 2023 Highlights #2 Business Overview Safe Harbour #3 Key Financials This presentation contains forward-looking statements which are subject to various expected or unexpected risks #4 Credit Profile and uncertainties that could have a material impact on the
Slide 3: Our strategy
2024 FIXED INCOME INVESTOR PRESENTATION Our strategy Distributed Distributed generation generation (Utility scale) (Private) DEMAND FOR ELECTRICITY Offshore WORLDWIDE BY 2030 Onshore wind wind Residential Datacenters OF THE ADDITIONAL Solar Infra- GENERATION CAPACITY TO structures BE ROLLED OUT BY 2
Slide 4: Nexans to acquire iconic La Triveneta Cavi in Italy
2024 FIXED INCOME INVESTOR PRESENTATION Nexans to acquire iconic La Triveneta Cavi in Italy Founded in 1965, primarily manufacturing low-voltage cables, mainly for the European market. MONTECCHIO MAGGIORE ‒ In-house copper drawing facility A profitable player with best-in-class innovation and PEOPLE
Slide 6: Delivering on our targets upgraded in July
2024 FIXED INCOME INVESTOR PRESENTATION Delivering on our targets upgraded in July OBJECTIVES 2023 GUIDANCE 2023 PERFORMANCE Adj. EBITDA OUTSTANDING ADJUSTED EBITDA Incl. share-based compensation expenses incl. share-based compensation expenses (€570m to €630m previously) NORMALIZED OUTSTANDING FREE
Slide 7: Main highlights
2024 FIXED INCOME INVESTOR PRESENTATION Main highlights FINANCIAL STRONG FINANCIAL RESULTS SUPERIOR CASH GENERATION ROBUST CAPITAL ELEVATED AHEAD OF TARGETS REFLECTING STRICT MANAGEMENT EFFICIENCY SHAREHOLDER RETURN OWC MANAGEMENT Group Adj. EBITDA margin Normalized cash conversion Group ROCE Propos
Slide 8: Structurally improved our business
2024 FIXED INCOME INVESTOR PRESENTATION Structurally improved our business REPORTED EBITDA(1) (€M) AND NORMALIZED FREE CASH ROCE(5) (%) EBITDA MARGIN(2) (%) FLOW(3) (€M) & NCCR(4) ELECTRIFICATION 665 14% 22% 29% 26% 599 GROUP 463 454 20.5% 20.7% 10% 376 393 16.4% 347 9% 108% 227 68% 10.2% 66% 8% 6%
Slide 9: Accelerated decarbonization journey
2024 FIXED INCOME INVESTOR PRESENTATION Accelerated decarbonization journey GHG EMISSION REDUCTION LEVERS OUTPERFORMING TARGETS Target Actual SCOPE 1 & 2: ‒ Optimize production processes and machinery to -4% reduce energy consumption -8% -13% -17% ‒ Decarbonize upstream and downstream transportation
Slide 10: Electrification strategic initiatives powering resilience
2024 FIXED INCOME INVESTOR PRESENTATION Electrification strategic initiatives powering resilience INCREMENTAL CONTRIBUTION STRATEGIC – €M Targets Actuals TO ELECTRIFICATION EBITDA INITIATIVES IN 2023 100 €80M 100 ACTUAL 80 80 €47M 60 60 ACTUAL €50M 40 40 TARGET €40M TARGET 20 20 STRATEGIC CAPEX 0 0
Slide 11: Shift transformation upgraded targets
2024 FIXED INCOME INVESTOR PRESENTATION Shift transformation upgraded targets ELECTRIFICATION PORTFOLIO CLUSTERING 3.0 UNLEASH PROFITABILTIY % of Electrification businesses 2023 standard sales ‒ 5 units deployed driving EBITDA margin x3 in 2023 INNOVATION 20% DRIVERS ‒ Strict OWC management and cash
Slide 12: Enhancing Electrification profile with recent acquisitions
2024 FIXED INCOME INVESTOR PRESENTATION Enhancing Electrification profile with recent acquisitions EXIT TELECOM & DATA AMPLIFY USAGE & DISTRIBUTION Nexans’ M&A Blueprint Integration – €M Base Case Revised Case 15 15 12 11 10 10 10 7 5 +20% 5 +50% run-rate synergies run-rate synergies significantly 6
Slide 13: High expected return on investments
2024 FIXED INCOME INVESTOR PRESENTATION High expected return on investments HALDEN PLANT EXPANSION, THIRD CABLE-LAYING MoU FOR A MEDIUM VOLTAGE €40M FIRE SAFETY AND NORWAY VESSEL GREENFIELD IN MOROCCO INDUSTRY 4.0 INVESTMENT IN AUTUN PLANT, FRANCE Completed on-time Benefits in 2026 and beyond Drivin
Slide 15: Gradual performance improvement in H2
2024 FIXED INCOME INVESTOR PRESENTATION Gradual performance improvement in H2 +1%(1) Adjusted EBITDA impacted by a combination RECORD GENERATION & TRANSMISSION +17% excl. of project mix and one-offs especially in H1. ADJUSTED BACKLOG (€Bn) Umbilicals Gradual margin upturn in H2 from improved project
Slide 16: Secular trends driving record margins
2024 FIXED INCOME INVESTOR PRESENTATION Secular trends driving record margins +5%(1) +78% Momentum supported by secular trends, INNOVATION including grid modernization and FROM PRODUCTS TO SOLUTIONS renewable energy projects. Absolute numbers reflecting Reka Cables acquisition 1,186 completed in Apr
Slide 17: Structural profitability improvement offsetting volume normalization
2024 FIXED INCOME INVESTOR PRESENTATION Structural profitability improvement offsetting volume normalization -6%(1) INNOVATION Focus on structural performance and FROM PRODUCTS TO SOLUTIONS selectivity supporting robust EBITDA margin at 14%. Performance resulting from successful transformation and A
Slide 19: Robust profitability: 10.2% Group adj. EBITDA margin
2024 FIXED INCOME INVESTOR PRESENTATION Robust profitability: 10.2% Group adj. EBITDA margin GROUP ELECTRIFICATION BUSINESSES NON-ELECTRIFICATION OTHER ACTIVITIES (INDUSTRY & SOLUTIONS) (MAINLY METALLURGY) +3.0% EXCL. OTHER ACTIVITIES +2.4% EXCL. UMBILICALS €6,745M €6,512M €3,884M €3,736M €1,559M €1
Slide 20: Adj. EBITDA up 8% in 2023 vs 2022
2024 FIXED INCOME INVESTOR PRESENTATION Adj. EBITDA up 8% in 2023 vs 2022 ADJ. EBITDA(1) EVOLUTION (€M) – GROUP In €M 2022 2023 +8% SALES AT CURRENT METAL PRICES 8,369 7,790 SALES AT STANDARD METAL PRICES 6,745 6,512 Organic growth +6.3% -0.9% Adj. EBITDA(1) 616 665 665 Adj. EBITDA on standard sales
Slide 21: Superior cash generation and robust balance sheet maintained
2024 FIXED INCOME INVESTOR PRESENTATION Superior cash generation and robust balance sheet maintained NET DEBT LAST 12 MONTHS EVOLUTION (€M) Strategic Capex Leverage Leverage 0.4x(1) 0.4x(1) NORMALIZED FCF NET DEBT Cash from Change in Reorganization Capital Other Financial Dividend & M&A IFRS16 & NET
Slide 23: Debt covenants
2024 FIXED INCOME INVESTOR PRESENTATION Low level of leverage ratio maintained over the past years NET DEBT LEVERAGE RATIO Covenant @3.2 x EBITDA 0.7 0.4 0,4 214 0.2 179 182 DEBT COVENANTS DEC 2020 DEC 2021 DEC 2022 DEC 2023 DEBT LEVEL Pro forma for LTC acquisition, leverage ratio estimated <1.0x GE
Slide 24: Reinforced by inaugural sustainability-linked bond issued in 2023
2024 FIXED INCOME INVESTOR PRESENTATION Reinforced by inaugural sustainability-linked bond issued in 2023 NET DEBT BREAKDOWN LIQUIDITY AND DEBT REDEMPTION SCHEDULE (€M) TOTAL AVAILABLE In €M DEC 22 DEC 23 LIQUIDITY GROSS DEBT 1,316 1,345 1,931 Cash & cash equivalents (1,134) (1,131) Undrawn 800 GROS
Slide 25: 67% of gross debt at fixed rate
2024 FIXED INCOME INVESTOR PRESENTATION 67% of gross debt at fixed rate FINANCING SOURCES (€M) DEBT REFINANCING SCHEDULE (€M) Other €101m 8% Bond €200m 2.75% NEU CP FINANCING SOURCES (€M) €287m Bond 24% €600m Sustainability- 51% Linked Bond €400m NEU CP 5.50% EIB(1) €287m €200m EIB(1) 17% €200m 2024
Slide 26: Successful transformation and strong performance recognized
2024 FIXED INCOME INVESTOR PRESENTATION To be updated in 2024 after S&P memo update Successful transformation and strong performance recognized “ BB+ Nexans’ operating performance has improved, thanks to progress made in outlook BB+ positive outlook its transformation plan, which focuses on electrif
Slide 28: Delivering on our 2024 commitments
2024 FIXED INCOME INVESTOR PRESENTATION Delivering on our 2024 commitments 2021 CMD COMMITMENTS 2024 OBJECTIVES 2023 ACHIEVEMENTS GROUP INLINE EBITDA MARGIN % (1) ELECTRIFICATION ACTIVITIES INLINE NORMALIZED CASH CONVERSION % (1) GROUP OUTSTANDING ROCE ELECTRIFICATION ACTIVITIES INLINE OWC GROUP OUT
Slide 29: 2024 guidance: tailwinds and headwinds
2024 FIXED INCOME INVESTOR PRESENTATION TAILWINDS OVERALL GROUP (Excluding non-closed ‒ Continuation of buoyant market acquisitions and divestments) demand, supported by global megatrends in electrification ‒ Transformation and value-added solutions to support structural profitability improvements ‒
Slide 30: Nexans Capital Markets Day 2024
NEXANS CAPITAL MARKETS DAY 2024 November 13th, 2024 London For more information contact investor.relations@nexans.com Page 30
Slide 32: Nexans actively engaging with investors
2024 FIXED INCOME INVESTOR PRESENTATION Nexans actively engaging with investors JUNE 12TH JP Morgan CEO conference, London FEB 15TH & 19TH FEB 26TH-27TH MARCH 4TH MARCH 19TH MAY 14TH MAY 28TH Paris roadshow NYC roadshow Berenberg Pan BofA Global Industrials ODDO BHF Sustainability Société Générale N
Slide 33: A global player of the energy transition
2024 FIXED INCOME INVESTOR PRESENTATION A global player of the energy transition ELECTRIFICATION BUSINESSES 2023 OUR PURPOSE WE ELECTRIFY THE FUTURE STANDARD SALES GENERATION & TRANSMISSION DISTRIBUTION USAGE OUR VALUES DEDICATED PIONNEERS UNITED PEOPLE OUR PROMISE COUNTRIES SCALE-UP TO STEP-UP OTHE
Slide 34: and balanced geographic footprint
2024 FIXED INCOME INVESTOR PRESENTATION and balanced geographic footprint 22% 45% 57% 70% NORTH AMERICA EUROPE 16% 2% OTHERS ELECTRIFICATION OTHERS ELECTRIFICATION 13% 12% GENERATION & GENERATION & TRANSMISSION TRANSMISSION €6.5Bn €665m 2023 SALES AT STANDARD 2023 ADJUSTED METAL PRICE 18% EBITDA 23%
Slide 35: Unleashing the Group's full potential
2024 FIXED INCOME INVESTOR PRESENTATION Unleashing the Group’s full potential +69% Reported EBITDA(1) (€m) 670-730 665 599 463 411 413 375 350 333 347 316 325 288 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 GUIDANCE (1) EBITDA is defined as operating margin before depreciation a
Slide 36: Sales at standard metal price and profitability
2024 FIXED INCOME INVESTOR PRESENTATION Sales at standard metal price and profitability 2022 PRO FORMA(1) 2023 Adj. Adj. Adj. Standard Organic EBITDA Standard Organic In €M EBITDA EBITDA EBITDA EBITDA% Sales growth (2) reported Sales growth (2) % ELECTRIFICATION 3,884 +12.6% 468 12.0% 468 3,736 -1.5
Slide 37: Impact of foreign exchange and consolidation scope
2024 FIXED INCOME INVESTOR PRESENTATION impact of foreign exchange and consolidation scope 2022 Allocation 2022 Organic Scope Organic FX FX 2023 reported changes pro forma Growth effect growth ELECTRIFICATION 3,816 69 3,884 (226) (53) 131 3,736 -1.5% → Generation & Transmission 897 61 958 (95) 7 - 8
Slide 38: Adjusted EBITDA reconciliation
2024 FIXED INCOME INVESTOR PRESENTATION In €M 2020 2021 2022 2023 EBITDA (incl. share-based payment expenses - 2021 CMD guidance) 347 463 599 652 EBITDA margin on Standard sales 5.8% 7.6% 8.9% 10.0% IFRS 2 Share-based payment expenses 4 8 16 13 ADJUSTED EBITDA 351 470 616 665 Adjusted EBITDA on Stan
Slide 39: Normalized net income and free cash flow
2024 FIXED INCOME INVESTOR PRESENTATION In €M 2022 2023 OPERATING MARGIN 420 432 Cost of debt (net) (35) (59) Other financial income and expense restated (26) (23) Income taxes (incl. impact from normalization adjustments) (101) (96) Minority interests (3) (2) NORMALIZED NET INCOME (GROUP SHARE) 255
Slide 40: Debt covenants as of December 31, 2023
2024 FIXED INCOME INVESTOR PRESENTATION as of December 31, 2023 In €M DEC 2022 DEC 2023 GEARING RATIO Fixed assets and other non-currentassets 2,271 2,611 Covenant @120% Net Debt Gearing(1) of which: goodwill 289 293 Deferred tax assets 122 129 11% 12% NON-CURRENT ASSETS 2,393 2,740 5% Working Capit
Slide 41: The urgency of Electrification
2024 FIXED INCOME INVESTOR PRESENTATION The urgency CABLE MARKETS FORECAST of Electrification NET-ZERO TRANSITION GRID RENEWAL & STRENGTHENING SMART & SAFE BUILDINGS The beginning of a demand ‒ Shift from fossil fuel to renewables ‒ Replace and monitor ageing grids to ‒ Supply renovation wave and sm
Slide 42: €20Bn project pipeline for offshore wind and interconnection projects
2024 FIXED INCOME INVESTOR PRESENTATION €20Bn project pipeline for offshore wind and interconnection projects SELECTION OF FUTURE SUBSEA OFFSHORE WIND PROJECTS SELECTION OF FUTURE SUBSEA INTERCONNECTION PROJECTS Installation Capacity Fully Capacity Project AC / DC Country Project Countries date (MW)
Slide 43: Robust corporate governance and board practices
2024 FIXED INCOME INVESTOR PRESENTATION Robust corporate governance and board practices 14 MEMBERS (50%WOMEN, 50%MEN) JEAN MOUTON ANNE LEBEL JANE BASSON LAURA MARC GRYNBERG SYLVIE JÉHANNO HUBERT PORTE 4 DIRECTORS 11 MAIN AREAS 3 DIRECTORS Chairman Lead Independent Independent Director BERNARDELLI In
Slide 44: GHG emissions reduction
2024 FIXED INCOME INVESTOR PRESENTATION Targets validated by the SBTi SCOPE 3 SCIENCE BASED INITIATIVE (SBTi) TARGETS VS 2019 BASE YEAR EMISSIONS UPSTREAM PURCHASE OF FREIGHT RAW MATERIALS SCOPE 1 GHG emissions reduction (in -22% EMISSIONS -30% DIRECT INDUSTRIAL OPERATIONS -29% SCOPE 1&2 -46% SCOPE
Slide 45: Definitions
2024 FIXED INCOME INVESTOR PRESENTATION Adjusted Generation & Transmission backlog: Backlog adjusted for secured but not yet Organic growth: Standard sales growth as a percentage of prior-year standard sales. Organic implemented Subsea, Land and Special Telecom contracts. growth is a measure of grow
Slide 46: Thank you
Thank you

Nexans — Debt Investor Presentation (February 2024) on 6ix

Nexans Sa — Debt Investor Presentation (February 2024)

Slide 1: 2024 Fixed Income Roadshow

Slide 2: Safe Harbour

Slide 3: Our strategy

Slide 4: Nexans to acquire iconic La Triveneta Cavi in Italy

Slide 5: Section 01

Slide 6: Delivering on our targets upgraded in July

Slide 7: Main highlights

Slide 8: Structurally improved our business

Slide 9: Accelerated decarbonization journey

Slide 10: Electrification strategic initiatives powering resilience

Slide 11: Shift transformation upgraded targets

Slide 12: Enhancing Electrification profile with recent acquisitions

Slide 13: High expected return on investments

Slide 14: Section 02

Slide 15: Gradual performance improvement in H2

Slide 16: Secular trends driving record margins

Slide 17: Structural profitability improvement offsetting volume normalization

Slide 18: Section 03

Slide 19: Robust profitability: 10.2% Group adj. EBITDA margin

Slide 20: Adj. EBITDA up 8% in 2023 vs 2022

Slide 21: Superior cash generation and robust balance sheet maintained

Slide 22: Section 04

Slide 23: Debt covenants

Slide 24: Reinforced by inaugural sustainability-linked bond issued in 2023

Slide 25: 67% of gross debt at fixed rate

Slide 26: Successful transformation and strong performance recognized

Slide 27: Section 05

Slide 28: Delivering on our 2024 commitments

Slide 29: 2024 guidance: tailwinds and headwinds

Slide 30: Nexans Capital Markets Day 2024

Slide 31: Appendices

Slide 32: Nexans actively engaging with investors

Slide 33: A global player of the energy transition

Slide 34: and balanced geographic footprint

Slide 35: Unleashing the Group's full potential

Slide 36: Sales at standard metal price and profitability

Slide 37: Impact of foreign exchange and consolidation scope

Slide 38: Adjusted EBITDA reconciliation

Slide 39: Normalized net income and free cash flow

Slide 40: Debt covenants as of December 31, 2023

Slide 41: The urgency of Electrification

Slide 42: €20Bn project pipeline for offshore wind and interconnection projects

Slide 43: Robust corporate governance and board practices

Slide 44: GHG emissions reduction

Slide 45: Definitions

Slide 46: Thank you