Prysmian accelerates and raises guidance

A Prysmian bigger and faster: the strong acceleration in cash and margins and the integration of the newly acquired Encore Wire are pushing the Italian group, specialised in the production of industrial cables, to raise the bar on targets. By the end of the year, Prysmian now indicates an adjusted Ebitda of between €1.9 billion and €1.95 billion, free cash flow in the range of €840 million to €920 million, a 36% reduction in Scope 1 and 2 Ghg emissions, and a Scope 3 reduction of 13% compared to 2019, even including Encore Wire within the scope. And for the future, the goal is aimed even higher: "in the first months of 2025 we will hold a new Capital Markets Day, since in many business units we have already reached and exceeded the targets of the previous one," said CEO Massimo Battaini commenting on the results with journalists. "We aim to focus our strategy on the integration with Enore Wire and on organic growth, considering the solid growth drivers present in the market today.

The Guided Group ended the first half of the year with a net profit of EUR 402 million, down slightly (-0.7%) year-on-year. Revenues amounted to EUR 7.8 billion (-3%). Ebitda stood at EUR 801m (compared to EUR 828m in H1 2023), including net charges for corporate reorganisations, non-recurring and other non-operating expenses of EUR 68m. Adjusted Ebitda reached 869 million, above the consensus of 864 million, with a margin of 11.1%, described by top management as 'high and satisfactory'. Free cash flow over the last twelve months increased to EUR 889 million, up 57% from EUR 567 million in June 2023. Net financial debt fell sharply to EUR 1.321bn, above the consensus of EUR 1.4bn, a reduction driven both by strong cash generation and the partial conversion of the Convertible Bond Loan completed in July.

"The results," explains Battaini, "show that Prysmian's profitability remains solid and that the company is well positioned to take advantage of the long-term trends of energy transition and digitalisation to continue to grow organically.

In terms of revenues, the strong organic growth generated by the Transmission (+9.5%) and Power Grid (+1.7%) business," a release explained, "was offset by a decrease in revenues in both the Electrification and Digital Solutions businesses. Transmission's adjusted Ebitda and adjusted Ebitda margin rose to EUR 150 million and 13.8% respectively, while Power Grid's adjusted Ebitda increased by 31.5% to EUR 238 million, with a margin of 13.2%. In the Electrification business, the adjusted Ebitda margin of the Specialities segment improved to 11.5%, with an adjusted Ebitda of 179 million, while in the Industrial & Construction segment the margin decreased to 9%, with an adjusted Ebitda of 224 million. The Digital Solutions business recorded the second consecutive quarter of improvement, reaching EUR 76 million, while the adjusted Ebitda margin was 11.6%.

"The increase in full-year guidance," Battaini added, "is due not only to the acquisition of Encore Wire, which was completed ahead of schedule, but also to our rigorous focus on profitability and excellent cash generation. These results were achieved as Prysmian continues to make strides in reducing carbon emissions and increasing revenues from sustainable products, which have a clear and measurable impact on the planet and society".