Prysmian Group records best year ever: 2022 results above all expectations

Via Prysmian Group

Mar 10, 2023

Milan, Italy   -   03/09/2023 - 12:30 pm

  • Sales at €16,067m, organic growth at +14.4%
  • Adjusted EBITDA at €1,488m, +52.5% vs 2021, with sharply improved margins at 9.3% vs 7.7% in 2021
  • Group net profit soar to €504m (+63.4%)
  • Strong cash generation, free cash flow at €559m (+ 53% vs 2021) and net debt down to €1,417m

Co2 (scope 1&2) emissions at –24%, scope 3 at -7.5% vs 2019 baseline (SBTI certified data);

Business performance driven by energy transition, electrification and digitalisation, with order book projects at €8.4bn

  • Projects sales at +30.3% thanks to submarine energy systems
  • Energy sales at +12.3%, fuelled by renewables, power distribution and data centres
  • Telecom sales at +10.9%, driven by sales of optical cables

Higher dividend: proposed a €0.60 per share (+9% vs 2021)

Capex of €500m per year in 2023-2025 for energy and digital transition

FY2023 guidance: adjusted EBITDA at €1,375m-€1,525m / FCF at €450m-€550m

Milan, Italy – The Board of Directors of Prysmian S.p.A. approved today the Group’s consolidated results for 2022 .

“Technology innovation, an efficient and effective supply chain and a customer-centric focus allowed us to fully seize the opportunities offered by the current energy transition, electrification and digitalisation trends, enabling us to report record results that exceeded all our expectations,” stated CEO Valerio Battista. “The strong sales growth was accompanied by the jump of over 50% in net profit and cash generation and debt reduction, with a debt ratio to Adjusted EBITDA falling below 1x and further reinforcing our financial structure. The positive start to 2023 confirms the competitive positioning achieved and enables us to set the goal for 2023 of consolidating our 2022 record performance,” concluded Battista.

“I would like to underscore that, in a year of record results such as 2022, we also paid strong attention to the adoption of new policies and tools for redistributing the value generated to all our stakeholders and for engaging all our employees, not only top managers,” Battista added.

FINANCIAL HIGHLIGHTS Group Sales rose to €16,067 million, with a +14.4% organic change. All the businesses exposed to secular energy transition, electrification and digitalisation trends reported the best results, such as submarine cables and systems for power interconnections and offshore wind farms links, cables for energy grid hardening, cables for the renewables and electric mobility sectors, data centres, cables for non-residential constructions and optical cables. The Projects segment reported the highest organic growth with +30.3%, followed by the Energy segment at +12.3% and Telecom at +10.9%.

Adjusted EBITDA jumped by +52.5% to €1,488 million, improving also compared to the upper part of the guidance, revised at €1,475 million in November 2022. Exchange rates generated a positive impact of approximately €110 million compared to 2021. Margins also improved, with the ratio of Adjusted EBITDA to Sales at 9.3%, increasing by 160 bps compared to 7.7% for 2021. The Telecom segment confirmed its record profitability, with margins at 14.5%. The profitability of the Energy segment improved significantly, with the ratio of Adjusted EBITDA to Sales at 8.1% compared to 5.7% in 2021. Adjusted EBITDA of the Projects segment grew to €243 million, although the sales mix and the impact of inflation on costs affected profitability, which stood at 11.2% (13.2% in 2021). It should be noted that the projects acquired in 2022 are more profitable than those already awarded in the 2018-2019 period.

EBITDA was €1,387 million (€927 million in 2021), including net expenses for company reorganisations, non-recurring expenses and other non-operating expenses totalling €101 million (€49 million in 2021). Operating income amounted to €849 million (€572 million in 2021).

Net profit attributable to owners of the parent jumped by +63.4% to €504 million compared to €308 million for the previous year.

Free Cash Flow before acquisitions and disposals amounted to €559 million (excluding antitrust-related flows), up +53.2% (€365 million for 2021), thus significantly exceeding the upper part of the guidance, which had been revised upwards to €500 million in last November.

As a result of the cash flow generation, Net Financial Debt fell sharply to €1,417 million at year-end (€1,760 million at 31 December 2021). This was driven by the Free Cash Flow of €559 million generated by the Group, excluding cash flows from acquisitions and disposals for €7 million and €44 million antitrust-related outflows. The factors that led to this €559 million positive cash flow were:

  • €1,405 million operating cash flows before changes in net working capital;
  • €7 million cash outlays for restructuring costs;
  • €105 million cash flow absorbed by the increasing net working capital;
  • €452 million cash outflows in net capital investments;
  • €71 million in payment of net finance;
  • €221 million in taxes payment;
  • €10 million in dividends received from associates.

ABOUT €500 MILLION YEARLY CAPEX IN THE 2023-2025 THREE-YEAR PERIOD FOR ENERGY AND DIGITAL TRANSITION

“The solidity of our financial structure allows us to keep a balanced position while sustaining the significant investments planned for the coming three years to further strengthen our positioning and our ambition to be a global benchmark for energy transition, electrification and digitalisation,” commented CEO Valerio Battista.

The CAPEX plan approved by the Group for the 2023-2025 period calls for investments up to about €500 million a year referring mainly to production capacity adjustments and the new submarine cable plant in the USA, a new cable-laying vessel alongside the Leonardo da Vinci, and technology innovation.

 

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