There is no peace for Prysmian. After the problems related to the WesternLink case - the cable connection between Scotland and Wales - the company that manages the energy and telecommunications cable systems is grappling with the disappointing accounts of 2018: the stock did not sell at the start and lost 7%, while mid-morning it was in decrease of 5,43% to 16,97 euros and marks the worst performance on the main list, with the Ftse Mib rising by 0,17%.
The data released yesterday with the stock market closed, as Morgan Stanley analysts report in a note, were disappointing for the whole of 2018 and the fourth quarter was not worthy of note. "Earnings trajectory has not changed significantly, with reasonable confidence on Western Link and Viking projects, synergies and debt, but valuations remain depressed," the note said.
The problems associated with the construction of the submarine cable between Scotland and Wales - built by Siemens and Prysmian - led Prysmian to set aside an additional €2018 million in the fourth quarter of 25, in addition to the 70 million already allocated in the first nine months of the year, which negatively impacted the adjusted Ebitda of the Projects division, and more generally of the group. Prysmian CEO Valerio Battista also spoke on the issue, stating during the conference call that he is confident that the situation is now under control, although he cannot guarantee 100% the absence of further setbacks.
Group revenues were in line with expectations, while adjusted ebitda was lower than expected. On the positive side, free cash flow generation was solid and net debt at $2,2 billion at the end of 2018 was better than expected. The company plans a adjusted ebitda between 950 and 1.020 million for 2019. 'Investors' patience was tested in 2018 - write the Morgan Stanley experts - and we would have hoped that the fourth quarter numbers were stronger. But what matters is the earnings trajectory which is perfectly in line with expectations'.
Equita analysts, on the other hand, have a hold rating with a target reduced to 21 euros, equal to -7%: 'They are weaker in 2018 at an operational level while the guidance for 2019 was substantially in line with expectations'. The analysts they also reduced their adjusted earnings per share estimates for 2019-2020 by 2 or 3%.
