Scienza e Tecnologia
NEXANS TO BECOME THE FIRST ELECTRIFICATION PURE PLAYER
PRESS RELASE _
NEXANS TO BECOME THE FIRST ELECTRIFICATION PURE PLAYER
Paris, February 17, 2021 – Nexans is hosting today at 2:00pm CET it's Virtual Capital Markets Day. Christopher Guérin, CEO, Jean-Christophe Juillard, CFO, and other members of the Executive Committee will highlight the Group's industrial ambition, operational roadmap and financial objectives for 2021-2024.
Since 2018, Nexans has undertaken an in-depth transformation, building a leaner, more customer centric and profitable Group. In just two years, the successful deployment of the New Nexans operating model, has enabled the Group to unlock value and set strong financial footing.
Today, Nexans is steered for growth.
Our strategy: from a generalist cable manufacturer to pure electrification player
For the last 120 years, Nexans has played a major role in the world's electrification. This market represents 65% of the world cable market and is expected to grow by +4.3% per annum over the next 10 years driven by key growth trends: growing energy consumption, demand for sustainable energies, grid modernization and protection. The world is becoming more electric and carbon neutral. Likewise, customer needs are changing from cables to systems and interconnected solutions.
Convinced that remaining a generalist will be more a weakness than a strength, Nexans intends to become a pure electrification player.
Simplify to Amplify. The Group will simplify its business model by moving from 8 macro sectors, representing 34 subsectors, to 4 sectors, representing 12 subsectors. Nexans will become a unique fully integrated player covering the entire electrification value chain: from the very start of production of energy, to transmission and distribution of energy, all the way to usage of energy.
The Group will amplify its impact through two axes:
Our purpose: “Electrify the future”
Nexans will position all its operations across the electrification value chain. From Generation and Transmission to Distribution and Usages . The Group will enhance its positioning in the Offshore Windfarms and Interconnection markets notably through additional 200 million euros investments, while maintaining a value proposition based on three pillars: i) Risk & project portfolio management, ii) Asset management, and iii) Cutting-edge technology. In Distribution , Nexans will reinforce its turnkey solutions combining cables and accessories with installation, architecture design, smart systems and asset management. In Usages , the Group will focus its offer on end-user electrical safety, support to client competitiveness through seamless supply chain for easy to handle and install products, and smart products integrated in a digital ecosystem.
Nexans will lead the electrification of the future in a sustainable way. As announced during its Climate Day on September 22, 2020, Nexans will reach carbon neutrality by 2030.
2021-2024 financial targets: accelerate value growth and cash generation
By 2024, Nexans will become a 6 to 7 billion euros standard sales pure Electrification player , with higher profitability - EBITDA expected between 10% to 12% of sales and stronger cash generation between 500 to 600 million euros before M&A and equity operations.
First, on its existing Electrification portfolio, the Group aims to generate standard sales of 3.5 to 3.7 billion euros and an EBITDA margin of 11% to 13% compared to 8% to 10% in 2021. To reach this stage in its development, the Group intends to continue to streamline its cost base and improve industrial performance, build on its smart innovations, ramp-up of its investments in state-of-the-art Aurora vessel and the expansion of its Charleston high-voltage subsea plant in the USA, as well as the additional capacity investments in High-Voltage & Projects business.
Second, the Group will rotate the remaining of its portfolio through divestments while also target transformative deals and bolt-on acquisitions to complete its electrification offer and enable Nexans to scale-up with a new value proposition. The related EBITDA improvement is expected between +50 to +150 bps.
Nexans will also maintain strict financial discipline with a leverage ratio of less than 2.5. Over the next three years, the Group's cash generation before M&A is expected between 500 and 600 million euros to finance capex investments, raise shareholder returns to achieve a dividend pay-out ratio above 20% and become debt-free by 2024.
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Nexans will hold today at 2:00 p.m. CET a virtual investor and analyst conference.
Live webcast link: https://channel.royalcast.com/landingpage/nexans/20210217_2/
Audio dial-in
Confirmation code: nexans cmd
We suggest connecting 10-20 minutes prior to start time of the event.
NB: Any discrepancies are due to rounding
This press release contains forward-looking statements which are subject to various expected or unexpected risks and uncertainties that could have a material impact on the Company's future performance.
Readers are also invited to visit the Group's website where they can view and download the presentation of the 2020 annual results to analysts as well as the 2020 financial statements and Nexans Universal Registration Document, which includes a description of the Group's risk factors
In addition to the risk factors described in Section 3.1 of the 2020 Universal Registration Document, the uncertainties for 2021 mainly include:
Without having major operational impacts, the two following uncertainties may have an impact on the financial statements:
Scenarios considered in the current CMD presentation will be further analyzed prior to deciding their implementation and projects resulting from those studies will be submitted to relevant legal bodies including to employee representative bodies if applicable and when needed.
About Nexans
Nexans is a global player in energy transition. Our purpose: electrify the future. For over a century, Nexans has played a crucial role in the electrification of the planet. With close to 25,000 people in 34 countries, the Group is leading the charge to the new world of electrification: safer, sustainable, renewable, decarbonized and accessible to everyone. In 2020, Nexans generated 5.7 billion euros in standard sales.
The Group designs solutions and services along the entire value chain in three main business areas: Building & Territories (including utilities and e-mobility), High Voltage & Projects (covering offshore wind farms, subsea interconnections, land high voltage), and Industry & Solutions (including renewables, transportation, oil and gas, automation, and others).
Corporate Social Responsibility is a guiding principle of Nexans' business activities and internal practices. As a signatory of the Global Compact since 2008, Nexans is committed to contribute to a responsible global economy and strives to promote the ten principles defined by the UN to all its stakeholders. The Group pledged to contribute to carbon neutrality by 2030 and was the first cable provider to create a Foundation supporting sustainable initiatives bringing access to energy to disadvantaged communities worldwide. Nexans' commitment to developing ethical, sustainable and high-quality cables also drives its active involvement within leading industry associations, including Europacable, the NEMA, ICF and CIGRE.
Nexans is listed on Euronext Paris, compartment A.
For more information, please visit www.nexans.com
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Leverage ratio of last two published nebt debt on last twelve months EBITDA
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