Prysmian S.p.a. · MIL:PRY
Prysmian — Q1 2016 Earnings Presentation
33 slides from Prysmian's earnings presentation, May 10, 2016
Slide 1: Q1 2016 Financial Results
Q1 2016 Financial Results Milan – May 10th, 2016
Slide 2: Agenda
Agenda Q1 2016 Highlights o Group overview o Results by business o Outlook Financial results Appendix Q1 2016 Financial Results 2
Slide 3: Q1 2016 Highlights
Q1 2016 Highlights Organic Growth at +2.3%, mainly driven by a sound execution in Energy Projects and a resilient performance in Telecom. Adj. EBITDA at € 150m (8.3% on Sales), with a general margin improvement thanks to the ongoing implementation of efficiency measures and a better business mix
Slide 4: New segment reporting
New segment reporting ENERGY PRODUCTS REPORTED ENERGY Industrial & Energy & PROJECTS OIL&GAS Network Infrastructure Other TELECOM Components Trade & Optical, Connectivity OEMs & Submarine SURF Installers Other Specialties & Fiber OCI Consolidation Multimedia & High Voltage Core Oil&Gas Automotive Ar
Slide 5: Q1 2016 Key Financials
Q1 2016 Key Financials Euro Millions, % on Sales Sales Adjusted EBITDA (1) **∆ OCI Contribution **∆ OCI Contribution Q1’16 vs. Q1’15 623 Q1’16 vs. Q1’15 7,361 +2.3%* 1,753 1,810 150 143** 120 12** 8.5% 6.8% 8.3% 2015 Q1 '15 Q1 '16 2015 Q1 '15 Q1 '16 * Org. Growth Operative Net Working Capital (2) Ne
Slide 6: Continued organic growth and profitability improvement
Continued organic growth and profitability improvement Margin increase driven by Energy Projects, Telecom & OCI Consolidation. Q1’15 Q1’16 * OCI Fully Consolidated Adj. EBITDA Margin 15.4% 11.2% 9.4% 10.3% 10.1% 8.7% 8.3%* 7.2% 6.8% 5.0%* 3.8% 3.8% Energy Industrial Projects E&I Oil&Gas Telecom Tota
Slide 7: Key Technology Milestones
Key Technology Milestones P-Laser 525kV HVDC cable system homologation: Faster manufacturing process More efficient power transmission (up to 10%) thanks to higher thermal stability Reduced CO2 emissions and fully recyclable Prysmian P-Laser 525kV HVDS cable section 66kV submarine system f
Slide 8: Agenda
Agenda Q1 2016 Highlights o Group overview o Results by business o Outlook Financial results Appendix Q1 2016 Financial Results 8
Slide 9: Energy Projects
Energy Projects Euro Millions, % on Sales Sales Highlights 1,416 Submarine • Strong growth benefitting from sound project execution and low phasing in Q1 2015. +26.4%* • Margin improved thanks to a strong project management and full 346 utilization of the new installation assets. 281 • The market of
Slide 10: Energy & Infrastructure
Energy & Infrastructure Euro Millions, % on Sales Sales Highlights **∆ OCI Contribution Trade & Installers 2,795 Q1’16 vs. Q1’15 • Slightly negative organic trend affected by the decline in Brazil and Argentina, partially offset by the positive performance in the UK, -0.5%* Eastern Europe, North Ame
Slide 11: Industrial & Network Components
Industrial & Network Components Euro Millions, % on Sales Sales Highlights Specialties & OEMs 1,499 • Overall positive trend, with solid performance of Crane, Marine and Defense, partially offset by shrinking Mining and slow start of Nuclear, Railway & Rolling stock applications. +1.4%* • Continued
Slide 12: Oil & Gas
Oil & Gas Euro Millions, % on Sales Sales Highlights 421 Market outlook: • Market remains uncertain, with tough commercial environment • Steady tendering activity at low levels and slowdown in Offshore investments. -33.9%* Core Oil&Gas Cables: Prices and volumes drop across all supply chain. Leverag
Slide 13: Telecom
Telecom Euro Millions, % on Sales Sales Highlights 1,109 Telecom Solutions • Margin benefitting from fiber production cost reduction, growth of copper business in Australia and improved results of YOFC. +3.3%* • Strong optical cable demand in Australia and North America offset 279 272 by a weak mark
Slide 14: Agenda
Agenda Q1 2016 Highlights o Group overview o Results by business o Outlook Financial results Appendix Q1 2016 Financial Results 14
Slide 15: 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) Mid-point target assumptions: • Continued positive trend in Energy Projects and Telecom 670 Mid-point € 695m 720 • Moderate
Slide 16: Agenda
Agenda Q1 2016 Highlights o Group overview o Results by business o Outlook Financial results Appendix Q1 2016 Financial Results 16
Slide 17: Profit and Loss Statement
Profit and Loss Statement Euro Millions ∆ OCI contribution Q1 2016 Q1 2015 Q1 ‘16 vs. Q1’15 Sales 1,810 1,753 143 YoY total growth 3.3% 11.0% YoY organic growth 2.3% 5.9% Adj.EBITDA 150 120 12 % on sales 8.3% 6.8% Non recurring items (10) (14) EBITDA 140 106 12 % on sales 7.7% 6.0% Adj.EBIT 111 84 1
Slide 18: Non Recurring and Special Items on EBIT
Non Recurring and Special Items on EBIT Euro Millions Q1 2016 Q1 2015 Antitrust investigation - (6) Restructuring (7) (8) Price adjustments - - Other (3) - EBITDA adjustments (10) (14) Special items (25) 13 Gain/(loss) on metal derivatives 2 20 Assets impairment (15) (6) Other (12) (1) EBIT adjustme
Slide 19: Financial Charges
Financial Charges Euro Millions Q1 2016 Q1 2015 Net interest expenses (15) (21) of which non-cash conv.bond interest exp. (2) (2) Bank fees amortization - (1) Gain/(loss) on exchange rates 7 (11) Gain/(loss) on derivatives 1) (9) 14 Non recurring effects (1) (1) Net financial charges (18) (20) 1) In
Slide 20: Statement of financial position (Balance Sheet)
Statement of financial position (Balance Sheet) Euro Millions 31 Mar 2016 New Perimeter 31 Mar 2015 31 Dec 2015 Acquired Net fixed assets 2,449 271 2,260 2,480 of which: intangible assets 708 180 560 722 of which: property, plants & equipment 1,535 91 1,442 1,552 Net working capital 641 223 716 342
Slide 21: Cash Flow
Cash Flow Euro Millions Q1 2016 Q1 2015 Adj.EBITDA 150 120 Non recurring items (10) (14) EBITDA 140 106 Net Change in provisions & others (16) (6) Share of income from investments in op.activities (7) (7) Cash Flow from operations (bef. WC changes) 117 93 Working Capital changes (294) (286) Dividend
Slide 22: Agenda
Agenda Q1 2016 Highlights o Group overview o Results by business o Outlook Financial results Appendix Q1 2016 Financial Results 22
Slide 23: New segment reporting
New segment reporting Sales and Adj.EBITDA breakdowns Previous Segment Reporting FY 2015 New Segment Reporting FY 2015 Sales Sales Telecom Energy Energy Telecom 15% Projects Projects 15% Other 22% 19% 2% Oil&Gas 6% Other € 7,361m 2% € 7,361m Industrial & Netw.Comp. Energy Industrial & Energy 24% Pro
Slide 24: Bridge Consolidated Sales
Bridge Consolidated Sales Euro Millions Energy Projects Oil & Gas Energy Products ( 2) ( 7) 74 1 ( 60 ) 143 ( 44 ) (37 ) (2 ) (9 ) 7 346 130 1,063 Org.growth 1,110 281 +0.1% 967 Org.growth +26.4% Org.growth 75 82 -33.9% Telecom Total Consolidated 10 - (15 ) 41 ( 2) ( 64) 148 ( 68 ) Org.growth 1,810
Slide 25: Profit and Loss Statement
Profit and Loss Statement Euro Millions ∆ OCI contribution Full OCI Q1’16 Q1 2016 Q1 2015 Q1 ‘16 vs. Q1’15 Results Sales 1,810 1,753 143 143 YoY total growth 3.3% 11.0% YoY organic growth 2.3% 5.9% Adj.EBITDA 150 120 12 16 % on sales 8.3% 6.8% 10.9% of which share of net income from OCI - 4 - - Non
Slide 26: Energy Projects Segment – Profit and Loss Statement
Energy Projects Segment – Profit and Loss Statement Euro Millions Q1 2016 Q1 2015 Sales to Third Parties 346 281 YoY total growth 23.3% YoY organic growth 26.4% Adj. EBITDA 39 26 % on sales 11.2% 9.4% Adj. EBIT 31 19 % on sales 8.8% 6.9% Q1 2016 Financial Results 26
Slide 27: Energy Products Segment – Profit and Loss Statement
Energy Products Segment – Profit and Loss Statement Euro Millions ∆ OCI Contribution Q1 2016 Q1 2015 Q1 ‘16 vs. Q1’15 E&I 754 686 143 YoY total growth 10.0% 0.0% Sales to Third Parties YoY organic growth (0.5%) 0.0% Industrial & Netw. Comp. 333 352 - YoY total growth (5.4%) 0.0% YoY organic growth 1
Slide 28: Oil&Gas Segment – Profit and Loss Statement
Oil&Gas Segment – Profit and Loss Statement Euro Millions Q1 2016 Q1 2015 Sales to Third Parties 82 130 YoY total growth (36.8%) YoY organic growth (33.9%) Adj. EBITDA 3 13 % on sales 3.8% 10.3% Adj. EBIT (2) 10 % on sales (1.8%) 7.7% Q1 2016 Financial Results 28
Slide 29: Telecom Segment – Profit and Loss Statement
Telecom Segment – Profit and Loss Statement Euro Millions Q1 2016 Q1 2015 Sales to Third Parties 272 279 YoY total growth (2.6%) 18.4% YoY organic growth 3.3% 13.1% Adj. EBITDA 42 28 % on sales 15.4% 10.1% Adj. EBIT 32 19 % on sales 11.7% 6.8% Q1 2016 Financial Results 29
Slide 30: New segment reporting: 2014-15 Sales & Org. Growth by quarter
New segment reporting: 2014-15 Sales & Org. Growth by quarter Euro Millions SALES and ORG. GROWTH FY 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 FY 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 FY 2015 ENERGY PROJECTS 1,248 250 302 300 389 1,241 281 358 355 423 1,416 1.1% 8.4% 14.7% 15.8% 8.9% 11.9% E&I 2,747 638 6
Slide 31: New segment reporting: 2014-15 Adj. EBITDA by quarter
New segment reporting: 2014-15 Adj. EBITDA by quarter Euro Millions ADJ. EBITDA and % ON SALES FY 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 FY 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 FY 2015 ENERGY PROJECTS 215 6 26 52 56 140 26 73 53 68 221 17.2% 2.4% 8.6% 17.3% 14.4% 11.3% 9.4% 20.4% 14.9% 16.1% 15.6% E&I
Slide 32: 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 33: 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