Prysmian falls on Piazza Affari after the publication of the first half-year accounts. At mid-morning, the shares lost 3,59% to 61,26 euros per share, achieving one of the worst performances of the Ftse Mib.
Prysmian's half-yearly report
The cable company closed the first six months of the year with a net profit of 402 million euros, slightly decreasing (-0,7%) compared to the same period a year ago. They also go down revenues (-3%), which stood at 7,8 billion. In a note Prysmian explains that the strong organic growth generated by the Transmission (+9,5%) and Power Grid (+1,7%) businesses was offset by a decrease in revenues in both the Electrification and Digital businesses Solutions.
Moving forward with the data, the ebitda of the first half is equal to 801 million, down compared to the 828 million of the first six months of the previous year, including net charges for company reorganisations, non-recurring charges and other non-operating charges of 68 million. The adjusted Ebitda instead it reached 869 million, exceeding the consensus of 864 million while the free cash flow LTM increased to 889 million, up 57% from 567 million in June 2023.
Net financial debt is in sharp decline which fell to 1,321 billion from 2,06 billion a year ago “thanks to excellent cash generation and the partial conversion of the Convertible Bond” completed in July.
Prysmian increases guidance
In light of the results obtained, and to take into account the acquisition of Encore Wire, finalized at the beginning of July, Prysmian has raised the outlook for the year and now expects an adjusted EBITDA of between 1,9 and 1,95 billion euros and a free cash flow expected in the range of 840-920 million euros.
Prysmian also expects a reduction in Scope 1&2 GHG emissions by 36% and Scope 3 by 13% compared to 2019.
"Encore Wire integration contributes 200 million euros to increase the guidance for 2024", explained Prysmian CEO Massimo Battaini during the call with journalists. “The previous guidance was between 1,575 and 1,675 billion – said Battaini – while the one communicated today is between 1,9 and 1,95 billion. Prysmian's businesses contribute 1,7 billion to this new guidance, therefore already above forecasts, while the integration of Encore Wire contributes a further 200 million".
CEO Battaini: “New plan at the beginning of 2025, solid profitability”
Battaini also confirmed that the new business plan will be presented on the occasion of a new capital markets day a start 2025. “We must wait a few months to allow the further consolidation of Encore Wire in the perimeter – he explained – and the new plan will re-evaluate the strategy that had been developed before the acquisition of the American company and will also take into account that some of our segments activities have already exceeded the set objectives".
“The first half 2024 results highlight that Prysmian's profitability remains solid and that the company is well positioned to benefit from the long-term trends of the energy transition and digitalisation to continue to grow organically – he explains the CEO Massimo Battaini -. The increase in full-year 2024 guidance is due not only to the acquisition of Encore Wire, which completed ahead of schedule, but also to our rigorous focus on profitability and excellent cash generation. These results have been achieved as Prysmian continues to make progress in reducing carbon emissions and increasing revenues from sustainable products, which have a clear and measurable impact on the planet and society."
“We reported solid results for the first half of the year with excellent cash generation,” concluded the CEO.
Prysmian wins 500 million project, will connect Mallorca to the mainland
Prysmian has finally announced that it has received a letter of award for an energy transmission project that will connect the island of Mallorca with the Spanish mainland. The value of the project will exceed 500 million of Euro. Prysmian and Red Eléctrica, operator of the transmission network of the Spanish electricity system, will conduct the contract negotiations exclusively, with signature expected by the end of 2024.
Prysmian will be responsible for the design, installation, testing and commissioning of two single-core HVDC cables as well as a fiber optic cable for telecommunications and monitoring, which will connect the island of Mallorca with the mainland Spanish electricity grid, covering both the underwater and land sections.
