Slide 1: 9M 2017 Financial Results
9M 2017 Financial Results Milan – November 7th 2017
Slide 2: Agenda
Agenda 9M 2017 Highlights o Group overview o Results by business o Outlook Financial results Appendix 9M 2017 Financial Results 2
Slide 3: 9M 2017 Financial Highlights
9M 2017 Financial Highlights Organic growth at -1.1%, sequentially improving in Q3 (-0.4%) supported by: Double-digit growth in Optical Telecom; Gradual recovery of T&I in Europe; Adj. EBITDA at € 545m (9.3% of sales), up from € 527m in 9M 2016 mainly driven by: Volume & margin expansion in Te
Slide 4: 9M 2017 Key Financials
9M 2017 Key Financials Euro Millions, % on Sales Sales Adjusted EBITDA (1) * 9M Adj.EBITDA excluding OCI (OCI Contribution: €26m in 9M’17 vs. €39m in 9M’16) 7,567 -1.1%* 711 5,660 5,865 545 527 519* 488* 9.4% 9.3% 9.3% 2016 9M'16 9M'17 2016 9M'16 9M'17 * Org. Growth Operative Net Working Capital (2)
Slide 5: Further margin expansion in value added businesses
Further margin expansion in value added businesses 9M’16 9M’17 Adj. EBITDA Margin 17.2% 17.6% 14.6% 14.9% 9.3% 8.0% 9.3% 9.3% 5.4% 4.3% 4.1% 2.3% Energy Industrial Projects E&I Oil&Gas Telecom Total & NWC. 9M’16 9M’17 ±X.X% = Sales Organic Growth -1.1% Adj. EBITDA (€ million) / % Org. Growth 527 545
Slide 6: Agenda
Agenda 9M 2017 Highlights o Group overview o Results by business o Outlook Financial results Appendix 9M 2017 Financial Results 6
Slide 7: Energy Projects
Energy Projects Euro Millions, % on Sales Sales Highlights 1,634 Submarine -6.7%* • Adj.EBITDA margin improved over the year supported by insourced 1,172 1,039 installation activities and favourable mix. • Recent offshore wind auctions in UK at record-low LRoE demonstrates the increasing competitive
Slide 8: Offshore Wind Market Outlook
Offshore Wind Market Outlook Cost reduction driven by technological innovation and projects scale European Offshore Wind Project Pipeline 6 • Robust project pipeline. Annual Capacity Installation (GW) 5 • Market will be driven by wind farm technology upgrades 4 CAGR 17-21: and cost effectiveness. +9
Slide 9: Energy & Infrastructure
Energy & Infrastructure Euro Millions, % on Sales Sales Highlights 3,016 -1.2%* Trade & Installers 2,467 • Recovery in Europe after a soft start of the year, led by Netherlands, Italy, 2,300 Spain and Nordics, also helped by CPR introduction. • Weakness in Middle-East (OCI) due to tough macro enviro
Slide 10: Industrial & Network Components
Industrial & Network Components Euro Millions, % on Sales Sales Highlights Specialties, OEMs & Renewables 1,343 +2.2%* • Moderate organic increase driven by volume pick-up in Railways and 1,100 recovery in Mining. Slowdown in Crane, Defense and Marine mainly linked 1,021 to difficult market conditio
Slide 11: Oil & Gas
Oil & Gas Euro Millions, % on Sales Sales Highlights SURF 300 -13.0%* • Umbilical: volumes and margin slump as market conditions remain highly competitive in Brazil. 225 201 • DHT: recovery in US (driven by Shale Oil) partially offset by low activities in international & offshore projects. Core Cabl
Slide 12: Telecom
Telecom Euro Millions, % on Sales Sales Highlights 1,164 +5.9%* Telecom Solutions & Fiber 953 • Double-digit growth in optical business, confirmed in Q3 despite 865 challenging comparison base. Solid market growth particularly in Europe (mainly France and Italy fixed broadband) and in US. • Slowdown
Slide 13: Agenda
Agenda 9M 2017 Highlights o Group overview o Results by business o Outlook Financial results Appendix 9M 2017 Financial Results 13
Slide 14: FY 2017 Outlook
FY 2017 Outlook 2017 Adj.EBITDA Target (€ million) 710 Mid-point € 730m 750 NEGATIVES POSITIVES - OCI - SUBMARINE - FOREX: ~€10m negative impact expected in FY2017 - OPTICAL CABLES (INCLUDING YOFC) 9M 2017 Financial Results 14
Slide 15: Agenda
Agenda 9M 2017 Highlights o Group overview o Results by business o Outlook Financial results Appendix 9M 2017 Financial Results 15
Slide 16: Profit and Loss Statement
Profit and Loss Statement Euro Millions 9M 2017 9M 2016 Sales 5,865 5,660 YoY total growth 3.6% 1.6% YoY organic growth (1.1%) 1.8% Adj.EBITDA 545 527 % on sales 9.3% 9.3% Adjustments (33) (39) EBITDA 512 488 % on sales 8.7% 8.6% Adj.EBIT 413 398 % on sales 7.0% 7.0% Adjustments (33) (39) Special it
Slide 17: Adjustments and Special Items on EBIT
Adjustments and Special Items on EBIT Euro Millions 9M 2017 9M 2016 Non-recurring Items (Antitrust Investigation) (17) - Restructuring (12) (27) Other Non-operating Income / (Expenses) (4) (12) EBITDA adjustments (33) (39) Special items (39) (26) Gain/(loss) on metal derivatives (2) 24 Assets impair
Slide 18: Financial Charges
Financial Charges Euro Millions 9M 2017 9M 2016 Net interest expenses (50) (44) of which non-cash conv.bond interest exp. (13) (6) Bank fees amortization (4) (2) Gain/(loss) on exchange rates (4) - Gain/(loss) on derivatives 1) (10) (11) Non recurring effects (2) (2) Other non-operating financial ex
Slide 19: Statement of financial position (Balance Sheet)
Statement of financial position (Balance Sheet) Euro Millions 30 Sep 2017 30 Sep 2016 31 Dec 2016 Net fixed assets 2,598 2,578 2,630 of which: goodwill 439 442 448 of which: intangible assets 304 339 344 of which: property, plants & equipment 1,632 1,580 1,631 Net working capital 794 693 325 of whic
Slide 20: Cash Flow
Cash Flow Euro Millions 12 Months (from 9M 2017 9M 2016 1/10/2016 to 30/9/2017) Adj.EBITDA 545 527 729 Adjustments (33) (39) (60) EBITDA 512 488 669 Net Change in provisions & others (21) (12) (9) Share of income from investments in op.activities (36) (24) (43) Cash Flow from operations (bef. WC cha
Slide 21: Agenda
Agenda 9M 2017 Highlights o Group overview o Results by business o Outlook Financial results Appendix 9M 2017 Financial Results 21
Slide 22: Bridge Consolidated Sales
Bridge Consolidated Sales Euro Millions Energy Projects E&I Industrial & NWC ( 33 ) ( 12 ) ( 78 ) 229 68 5 (8) 23 ( 52 ) ( 29 ) 1,172 Org.growth 2,467 1,100 -6.7% Org.growth Org.growth 1,039 1,039 2,300 -1.2% 1,021 +2.2% Oil & Gas Telecom Total Consolidated 15 ( 53 ) ( 37 ) ( 29 ) ( 3) 17 5 8 357 51
Slide 23: Profit and Loss Statement
Profit and Loss Statement Euro Millions 9M 2017 9M 2016 Sales 5,865 5,660 YoY total growth 3.6% 1.6% YoY organic growth (1.1%) 1.8% Adj.EBITDA 545 527 % on sales 9.3% 9.3% of which share of net income 36 24 Adjustments (33) (39) EBITDA 512 488 % on sales 8.7% 8.6% Adj.EBIT 413 398 % on sales 7.0% 7.
Slide 24: Energy Projects Segment – Profit and Loss Statement
Energy Projects Segment – Profit and Loss Statement Euro Millions 9M 2017 9M 2016 Sales to Third Parties 1,039 1,172 YoY total growth (11.4%) 18.0% YoY organic growth (6.7%) 20.9% Adj. EBITDA 179 172 % on sales 17.2% 14.6% Adj. EBIT 149 146 % on sales 14.3% 12.4% 9M 2017 Financial Results 24
Slide 25: Energy Products Segment – Profit and Loss Statement
Energy Products Segment – Profit and Loss Statement Euro Millions 9M 2017 9M 2016 E&I 2,467 2,300 YoY total growth 7.3% 5.8% Sales to Third Parties YoY organic growth (1.2%) (1.9%) Industrial & Netw. Comp. 1,100 1,021 YoY total growth 7.7% (10.2%) YoY organic growth 2.2% (2.5%) Other 105 77 YoY tota
Slide 26: Oil&Gas Segment – Profit and Loss Statement
Oil&Gas Segment – Profit and Loss Statement Euro Millions 9M 2017 9M 2016 Sales to Third Parties 201 225 YoY total growth (10.9%) YoY organic growth (13.0%) Adj. EBITDA 5 9 % on sales 2.3% 4.1% Adj. EBIT (8) (2) % on sales (3.8%) (1.0%) 9M 2017 Financial Results 26
Slide 27: Telecom Segment – Profit and Loss Statement
Telecom Segment – Profit and Loss Statement Euro Millions 9M 2017 9M 2016 Sales to Third Parties 953 865 YoY total growth 10.2% 2.2% YoY organic growth 5.9% 8.4% Adj. EBITDA 167 129 % on sales 17.6% 14.9% Adj. EBIT 138 99 % on sales 14.5% 11.4% 9M 2017 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 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 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