Prysmian S.p.a. · MIL:PRY
Prysmian — FY2018 Earnings Presentation
42 slides from Prysmian's earnings presentation, Apr 17, 2019
Slide 1: FY 2018 Financial Results
FY 2018 FINANCIAL RESULTS MILAN – April 17th,2019
Slide 2: Agenda
AGENDA ➢ FY 2018 Highlights o Group overview o Results by business o Outlook ➢ Financial Results ➢ Appendix 2
Slide 3: FY 2018 Financial Highlights
FY 2018 Financial Highlights Fully combined organic sales growth at +2.8% supported by: - Sound organic growth in Underground HV - A solid performance in Telecom, with a high single digit growth in optical and double-digit growth in MMS General Cable positive organic growth mostly driven by North Am
Slide 4: FY 2018 Financial Highlights
FY 2018 Financial Highlights General Cable Prysmian excl. GC Euro Millions, % on Sales Sales (3)(6) Adjusted EBITDA (3)(4)(6) Reported(1) FY Fully Combined (2) Reported(1) FY Fully Combined (2) +2.8%* 940 +2.6%* 11,353 11,524 204 767 10,105 693 3,449 3,536 197 2,117 123 736 736 7,904 7,988 7,904 7,9
Slide 5: FY 2018 General Cable by Geographical Area
FY 2018 General Cable by Geographical Area Euro Millions, % on Sales – Fully Combined Results Sales (3) (6) (8) Adj. EBITDA (3) (6) (8) Key Comments North America +4.6%* 149 139 38 • Strong and improving Q4 as expected 2,039 2,131 27 • Recovery in PD, sound performance in Industrial and Telecom, gro
Slide 6: New Segment Reporting
New Segment Reporting Energy (1) reporting Segment Projects Telecom Energy & Industrial & Network Infrastructure Components High Voltage Trade & Installers Core Oil & Gas products (*) Telecom solutions Specialties, OEM & Submarine Energy Power Distribution Optical Fibre Renewables Businesses Overhea
Slide 7: Performance by Segment – FY 2018 Fully Combined results
Performance by Segment – FY 2018 Fully Combined results FY’17 FY’18 Adj. EBITDA 18.0% 17.0% 15.5% Margin 7.4% 7.1% 8.3% 6.7% 4.3% 3.8% 5.7% Project E&I Industrial & NWC. Telecom Total FY’17 FY’18 +2.8% ±X.X% = Sales Organic Trend Adj. EBITDA (€ million) / 940 % Org. Growth 767 +1.7% +2.1% +3.3% +6.4
Slide 8: Adj. EBITDA Bridge FY'17 – FY'18 Fully Combined
Adj.EBITDA Bridge FY’17 – FY’18 Fully Combined Euro Millions Previous Prysmian Perimeter GC Perimeter 940 ( 194) 204 54 ( 33 ) (4) 5 - 775 (8) 767 (3) 10 12 774 770 770 767 746 743 743 753 10 (2) 4 - 197 Bad debt provision Including 165 €M reversal in Brazil Western Link provision & Q4 GC Results 73
Slide 9: Starting to create value through the integration
Starting to create value through the integration 2018 Synergies achieved 1 2 3 Cost Efficiencies Working Capital Synergies Financial Synergies ✓ Fixed cost reduction with organizational streamlining started ✓ Efficient stock management ✓ General Cable net debt at closing (level of inventory and plan
Slide 10: Agenda
AGENDA ➢ FY 2018 Highlights o Group overview o Results by business o Outlook ➢ Financial Results ➢ Appendix 10
Slide 11: Projects
Projects Euro Millions, % on Sales – FY 2018 Fully Combined Results Sales Highlights +1.7%* SUBMARINE • Adj. EBITDA impacted by 165 €M provision related to the Western Link project • Q4 Adj. EBITDA drop (ex-WL) affected by delayed phasing on specific projects, operational reworks and tough comp with
Slide 12: Energy & Infrastructure
Energy & Infrastructure Euro Millions, % on Sales – FY 2018 Fully Combined Results Sales Highlights +2.1%* TRADE & INSTALLERS • Positive organic trend, consolidated in Q4 with continued volume growth in North America and Europe • Adj. EBITDA slightly improving (excluding forex effect), driven by pro
Slide 13: Industrial & Network Components
Industrial & Network Components Euro Millions, % on Sales –FY 2018 Fully Combined Results Sales Highlights +3.3%* SPECIALTIES, OEMS & RENEWABLES • Positive organic growth, weakening in Q4, with continued positive trend in Railways, Crane and Solar. Stable Mining and Wind activities • Overall growth,
Slide 14: Telecom
Telecom Euro Millions, % on Sales – FY 2018 Fully Combined Results Sales Highlights +6.4%* OPTICAL CABLE & FIBRE • Robust growth, supported by positive trend in Europe, North America (ribbon) and Latin America • EBITDA Margin benefitting from volume increase, capacity expansion in fiber, plant suppl
Slide 15: Agenda
AGENDA ➢ FY 2018 Highlights o Group overview o Results by business o Outlook ➢ Financial Results ➢ Appendix 15
Slide 16: Overperforming on synergies: upgrading targets and timing
Overperforming on synergies: upgrading targets and timing Updated Synergies Plan 2018-21 €M = total synergies 25 €M additional costs synergies 1 Year faster ~ 175 ~ 155 Other ~ 120 Industrial footprint Procurement ~ 35 Management & staff ~ 5-10 previous actual previous updated previous updated previ
Slide 17: 2019 Guidance
2019 Guidance Adj. EBITDA Outlook Bridge (€M) (1) Mid-point Assumptions • Continued growth in Telecom 1 2019 Adj. EBITDA target 950 Mid-point 985 1,020 business • Recovery of WL 2018 one-off Total growth in Projects Adj. EBITDA • Declining results in submarine, as a result of low 2018 order intake.
Slide 18: Agenda
AGENDA ➢ FY 2018 Highlights o Group overview o Results by business o Outlook ➢ Financial Results ➢ Appendix 18
Slide 19: Profit and Loss Statement
Profit and Loss Statement FY 2017 FY 2018 Reported (1) Euro Millions Reported (6) of which Total Total General Cable Sales 10,105 2,117 7,904 YoY total growth 27.8% YoY organic growth 2.6% Adj.EBITDA 693 123 736 % on sales 6.9% 5.7% 9.3% Adjustments (192) (59) (76) EBITDA 501 64 660 % on sales 5.0%
Slide 20: Adjustments and Special Items on EBIT
Adjustments and Special Items on EBIT Euro Millions FY 2017 FY 2018 Reported (1) Reported of which Total Total General Cable Non-recurring Items (94) - (18) Restructuring (66) (39) (30) of which General Cable integration costs (49) (39) - Other Non-operating Income / (Expenses) (32) (20) (28) of whi
Slide 21: Financial Charges
Financial Charges Euro Millions FY 2018 Reported (1) FY 2017 Reported (6) Net interest expenses (80) (70) of which non-cash conv.bond interest exp. (12) (17) Bank fees amortization (8) (5) Gain/(loss) on exchange rates (11) (5) Gain/(loss) on derivatives (5) (15) Non recurring effects (2) (2) Other
Slide 22: Statement of financial position (Balance Sheet)
Statement of financial position (Balance Sheet) Euro Millions 31 December 2017 31 December 2018 Reported Reported* of which General Total Total Cable Net fixed assets 5,071 2,297 2,610 of which: goodwill 1,541 1,101 438 of which: intangible assets 591 314 297 of which: property, plants & equipment 2
Slide 23: Cash Flow
Cash Flow Euro Millions 1,215 (552) 105 (779) 110 278 84 2,857 (100) 2,747 2,663 2,485 39 2,222 2,385 2,385 Positive: 2,183 1,386 NwC Synergies 180 €M & GC seasonality 1,822 2,183 Negative: Increase in projects NwC Including acquisition, transaction and integration costs (96 €M) 436 436 31-Dec-17 GC
Slide 24: Prysmian Group Debt Profile
Prysmian Group Debt Profile Limited exposure to financial market volatility FIXED/VARIABLE RATE COMPOSITION REPAYMENT DATE (€M) Total gross debt: 3,172 (*) Convertible Unicredit Floating 200 Term Loan bond zero – 17% coupon 467 Acq Term RCF 2014 (**) Loan CDP 100 Eurobond 1,000 2,5% 1,000 Fixed 83%
Slide 25: Agenda
AGENDA ➢ FY 2018 Highlights o Group overview o Results by business o Outlook ➢ Financial Results ➢ Appendix 25
Slide 26: Bridge Consolidation Sales
Bridge Consolidation Sales Euro Millions - Fully Combined Results Projects Energy & Infrastructure 258 (260 ) 9 (41) 115 29 Total Consolidated Org.growth Org.growth ( 511) 322 360 1.7% 1,751 5,379 2.1% 5,492 1,754 Org.growth 2017 Organic Metal Exchange 2018 2017 Organic Metal Exchange 2018 2.8% Grow
Slide 27: Prysmian group at a glance
Prysmian group at a glance FY 2018 Financial Results - Fully Combined Results Sales breakdown by business Sales breakdown by geography €11.5 Billion €11.5 Billion LatAm 9% Telecom 14% Energy & Infrastructure 48% North America Energy 29% EMEA 71% Industrial & Network 54% Projects Components 20% 15% O
Slide 28: Projects
Projects FY2018 sales breakdown - Fully Combined Results Sales breakdown by business Sales breakdown by geography LatAm North America 4% 4% APAC High Voltage 8% Submarine 41% Energy 53% Offshore EMEA specialities 84% 5% Submarine TLC 1% €1.8 Billion €1.8 Billion 28
Slide 29: Energy & Infrastructure
Energy & Infrastructure FY2018 sales breakdown - Fully Combined Results Sales breakdown by business Sales breakdown by geography LatAm 10% Power Distribution 35% Trade & EMEA Installers 55% North America 62% 31% Overhead 3% APAC 5% €5.5 Billion €5.5 Billion 29
Slide 30: Industrial & Network Components
Industrial & Network Components FY2018 sales breakdown - Fully Combined Results Sales breakdown by business Sales breakdown by geography Network Components Core Oil & Gas LatAm Other 7% 6% products Industrial 8% 11% EMEA 35% Elevators 9% Specialties, OEM & Renewables North America 40% 41% Automotive
Slide 31: Telecom
Telecom FY2018 sales breakdown - Fully Combined Results Sales breakdown by business Sales breakdown by geography LatAm 10% MMS 29% Telecom EMEA Solutions North America 53% 66% 28% Fiber 5% APAC 9% €1.6 Billion €1.6 Billion 31
Slide 32: Profit and Loss Statement
Profit and Loss Statement FY 2018 Reported (1) FY 2017 Reported (6) Euro Millions of which Total Total General Cable Sales 10,105 2,117 7,904 YoY total growth 27.8% YoY organic growth 2.6% Adj.EBITDA 693 123 736 % on sales 6.9% 5.7% 9.3% of which share of net income 59 - 42 Adjustments (192) (59) (7
Slide 33: Cash Flow Statement
Cash Flow Statement FY 2018 FY 2017 (1) Reported Reported (**) Euro Millions Adj.EBITDA 693 736 Adjustments (192) (76) EBITDA 501 660 Net Change in provisions & others 110 (2) Share of income from investments in op.activities (59) (42) Cash flow from operations (before WC changes) 552 616 Working Ca
Slide 34: Financial Highlights
Financial Highlights Euro Millions - Fully Combined Results Sales / Growth Adj.EBITDA / Adj.EBITDA Margin FY 2018 FY 2017 FY 2018 FY 2017 General General General General Prysmian Total Prysmian Total Prysmian Total Prysmian Total Cable Cable Cable Cable PROJECTS 1,485 266 1,751 1,533 221 1,754 79 21
Slide 35: Project Segment – P&L Statement
Project Segment – P&L Statement Euro Millions 12M 2018 12M 2017* Sales to Third Parties 1,751 1,754 YoY total growth (0.2%) YoY organic growth 1.7% Adj. EBITDA 100 298 % on sales 5.7% 17.0% Adj. EBIT 48 239 % on sales 2.7% 13.6% (*) Restated according to IFRS 15 35
Slide 36: Energy segment – P&L Statement
Energy segment – P&L Statement Euro Millions 12M 2018 12M 2017 E&I 5,492 5,379 YoY total growth 2.1% YoY organic growth 2.1% Sales to Third Parties Industrial & Netw. Comp. 2,353 2,302 YoY total growth 2.2% YoY organic growth 3.3% Other 294 326 YoY total growth (9.8%) YoY organic growth 0.0% ENERGY
Slide 37: Telecom Segment – P&L Statement
Telecom Segment – P&L Statement Euro Millions 12M 2018 12M 2017 Sales to Third Parties 1,634 1,592 YoY total growth 2.6% YoY organic growth 6.4% Adj. EBITDA 295 247 % on sales 18.0% 15.5% Adj. EBIT 245 199 % on sales 15.0% 12.5% 37
Slide 38: Dividend Proposal
Dividend Proposal Dividend proposed to the forthcoming Shareholders’ Meeting Dividend Per Share: € 0.43 Dividend Yield (1) • Ex-dividend date: 24 June 2019 1.9% • Record date: 25 June 2019 • Payment date: 26 June 2019 DPS evolution (Euro per share) Draka acquisition 0.417 0.417 0.417 0.42 0.42 0.42
Slide 39: IFRS 16 Estimated Impacts
IFRS 16 ESTIMATED IMPACTS Key Highlights • First release in Q1 2019, with Q1 2018 comparable numbers • The transitional effect will be reported as on opening balance adjustment for leased assets and the corresponding liabilities • Prysmian applies the modified retrospective approach and consequently
Slide 40: Notes
Notes (1) General Cable consolidated in the period 1 June 2018 – 31 December 2018; (2) General Cable included in the period 1 January – 31 December; General Cable figures are restated applying Prysmian accounting principles and policies; 2017 figures excludes General Cable “non-core“ perimeter alrea
Slide 41: Disclaimer
Disclaimer • The managers responsible for preparing the company's financial reports, A.Brunetti 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 i
Slide 42: Thank you
Thank you prysmiangroup.com