Selective growth supporting 2021 performance

 PRESS RELEASE 

NEXANS: SELECTIVE GROWTH SUPPORTING 2021 PERFORMANCE

• Regular sales development regardless of difficult provide chain setting
• 2021 guidance confirmed
• First M&A milestone of Nexans 2022-2024 strategic ambition to Electrify the Future
  • +8.2% year-on-year customary¹ income natural development² within the first 9 months of 4,494 million euros, reflecting dynamic restoration and selective development according to SHIFT transformation and regardless of difficult provide chain setting. Within the third quarter, Group customary gross sales up +0.4% in comparison with third quarter 2020 at 1,382 million euros
  • Present gross sales land at 5,448 million euros within the first 9 months of the yr, up +27.2% alongside copper worth inflation
  • Profitable monitoring of provide chain challenges with no materials margin affect attributable to uncooked materials scarcity and price inflation
  • Demand drives wholesome backlog development (+9% year-on-year) throughout all companies; with Subsea Excessive-Voltage adjusted backlog at 1.5 billion euros³
  • Nexans Aurora inauguration and Charleston US excessive voltage plant commissioned to help the power transition.
  • Nexans 2022-2024 strategic ambition to Electrify the Future: groundwork initiated with the settlement to amass Centelsa in Colombia⁴
  • Confirmed 2021 steering⁵ supported by selective gross sales development, mounted prices reductions and SHIFT Efficiency program achievements

Paris, November 3, 2021 – At present, Nexans revealed its monetary data for the third quarter of 2021. Commenting on the Group’s achievements, Christopher Guérin, Nexans’ Chief Government Officer, stated: “Nexans confirms its strong trajectory and topline momentum supported by new worth creation levers round its mission: Electrify the longer term. Because of our amplified options, we have now initiated our strategic ambition 2022-2024 and reached first successes as our backlog is steadily up year-on-year and we verify our 2021 monetary steering upgraded in July. Nexans has a sound and clear roadmap to change into the Pure participant of Electrification. Within the final weeks, we have now:

1. Inaugurated with our key stakeholders our new vessel Nexans Aurora, an essential enabler to construct a safer, extra sustainable and inclusive international power system. This modern vessel will contribute to unlocking the large potential of offshore renewable power and subsea interconnection alongside our distinctive subsea cable manufacturing plant in Charleston, USA.
2. Reached a primary milestone of our new strategic ambition by saying September 10^th a Share Buy Settlement with Xignux SA to amass Centelsa⁴, a premium cable maker in Latin America. This world class and iconic South American operation will additional contribute to Nexans’ potential to serve renewable tasks within the Andean Area.
3. Continued to launch improvements to help additional worth creation whereas additionally reinforcing our ESG commitments by internet hosting Nexans’ second Local weather Day and proposing the election of Laura Bernardelli as an impartial director to the shareholders’ assembly.

Nexans strives to finest serve buyer wants whereas participating in a greater future and specializing in worth development for all its stakeholders.”

CONSOLIDATED SALES BY SEGMENT

I.   9M 2021 Highlights and General Operating Context

+8.2% natural development in 9M 2021 in comparison with 9M 2020

• Within the first 9 months of 2021, gross sales at customary steel costs totaled 4,494 million euros, up +8.2% organically in comparison with the primary 9 months of 2020 and up +0.4% within the third quarter 2021 in comparison with third quarter 2020, reflecting strong year-to-date dynamic and SHIFT transformation selective development, and regardless of difficult provide chain setting and third quarter seasonality.
• Nexans demonstrated wholesome backlog development in all segments due to sound business momentum and prolonged risk-reward selectivity. Continued demand drove backlog up +9% year-on-year.
• Tight monitoring of uncooked materials price inflation and provide scarcity avoidance had been ensured by: i) price cross by mechanism and different mitigation measures embedded in our operations, for instance hedging of non-ferrous supplies or materials costs (copper and aluminum) contracting and; ii) Nexans distinctive SHIFT Efficiency mannequin enabling agility and efficiency whereas lowering volumes to give attention to worth yield clients/merchandise.

2019-2021 Transformation Plan: Closing steps

• 2021 confirmed steering on EBITDA, ROCE and Free Money Stream earlier than M&A and fairness operations supported by continued efficiency in all actions.
• Throughout the quarter, the Group pursued SHIFT transformation program throughout all operations additional implementing price and productiveness enhancements whereas additionally intently monitoring uncooked materials provide and price appreciation.
• Nexans unveiled its second cable-laying vessel, the Nexans Aurora, to clients and stakeholders at a devoted ceremony in Halden, Norway. Charleston plant within the US was commissioned and progressed on the manufacturing of HV cables for Seagreen Offshore Wind farm undertaking in Scotland.

2022-2024 strategic ambition: First M&A milestone

Over the interval, the Group began laying the groundwork on its three most important pillars:

• Simplify to Amplify: Nexans introduced its first M&A milestone aligned with the Group’s strategic ambition to change into a Pure Electrification Participant. The Group signed a Share Buy Settlement with Xignux to amass Centelsa, a premium cable maker based mostly in Colombia lively in Constructing and Utilities functions. Centelsa, a world class participant, had a complete turnover of greater than $250 million in 2020 and an enterprise worth of $225 million. Closing of the transaction is topic to regulatory approvals and is predicted to happen within the first half of 2022.
• Remodel and Innovate: the Group actively progressed on SHIFT Prime program implementation in its Constructing enterprise. Nexans stepped up its innovation program launching MOBIWAY UN’REEL within the quarter. This distinctive resolution offers less complicated and smarter set up of a big vary of cables. Additionally, the Group pursued its innovation roadmap by the rollout of VIGISHIELD which offers clients with a linked and full safety in opposition to cable theft.
• Scale-up to Step-up Efficiency: initiating metallurgy publicity discount.

II.   9M 2021 Gross sales per Enterprise Group

| BUILDING & TERRITORIES: +8.4% in 9M 2021 like-for-like⁶ reflecting selective development in dynamic markets

Constructing & Territories section gross sales amounted to 1,872 million euros at customary steel costs in first 9 months of 2021, up +3.0% organically and +8.4% on a like-for-like foundation in comparison with the primary 9 months of 2020. This market dynamic was fairly robust within the European and Latin American Constructing markets all through the interval. The great momentum was supported by robust plant utilization and continued selective development according to SHIFT Efficiency and initiating SHIFT Prime roll-out to drive margin enchancment additional.

Within the third quarter 2021, revenues had been down -1.5% reflecting closure of Chester plant within the US in June 2020. On a like-for-like foundation, gross sales had been up +2.4% within the third quarter of 2021, reflecting sound demand in Europe, North America and Africa & Center East regardless of third quarter seasonality.

The Constructing section witnessed robust demand within the third quarter throughout geographies and benefited from strong restoration within the development market all through the primary 9 months of the yr. The Territories (Utilities) exercise slowed-down through the interval attributable to frame-agreement ongoing renewal in Europe and an unfavorable base impact in Canada which had benefitted from contract renewals final yr.

The primary 9 months traits by geographies had been as comply with:

• Europe exercise stood at +5.5% within the first 9 months of 2021 in comparison with 2020 and +2.0% within the third quarter reflecting sustained dynamic notably within the development cable actions notably in France, Sweden and Spain.
• South America was strongly up by +27.1% within the first 9 months and +4.5% within the third quarter. The area benefitted from a double-digit development in Peru and Brazil in advantage of development exercise upturn, strong backlogs and bettering sanitary and political scenario. Chile benefitted from tasks contracts because the begin of the yr.
• Asia Pacific was down -4.7% within the first 9 months of 2021 and -1.7% in third quarter 2021. New Zealand continued to point out sound development, notably with the Utilities whereas Australia suffered from a slowdown in home demand attributable to continued Covid-19 lockdown measures, provide chain and freight constraints.
• North America declined by -30.4% within the first 9 months because of the US Chester plant closure in 2020 following SHIFT program evaluation. On a like-for-like foundation, gross sales had been up +13.6% within the first 9 months supported by strong market situations in Canada.
• Center East and Africa was up +13.0% within the first 9 months and +5.0% in third quarter 2021, boosted by document gross sales in Turkey and sound gross sales in Morocco and Ghana greater than offsetting decline in Lebanon, the place the geo-political scenario deteriorated within the first half and stays extremely unsure for the approaching months.

| INDUSTRY & SOLUTIONS: +13.5% in 9M 2021, strong development regardless of provide chain challenges

Trade & Options gross sales landed at 1,007 million euros at customary steel costs within the first 9 months of 2021, up +13.5% organically year-on-year supported by a document first half in Auto-harnesses enterprise. Third quarter 2021 was up +3.1%, reflecting strong momentum in Automation whereas Auto-harnesses enterprise was marginally impacted by semiconductor shortages.

Within the first 9 months, Automation was firmly up (+38.3% year-on-year), boosted by demand in Europe and China. Railway Infrastructure & Rolling Inventory gross sales had been down -7.5% year-on-year in advantage of decrease Asian demand. Aerospace & Protection recovered strongly with gross sales up +9.1% within the first 9 months. After a number of quarters of dynamic exercise, in mild of uncooked materials enhance, Wind Turbine exercise was down (-23.9% in gross sales year-on-year).

Because of a document first half, Automotive harnesses enterprise was up +29.9% within the first 9 months of 2021. The enterprise was resilient within the third quarter in advantage of premium shopper publicity and regardless of being challenged by semiconductor scarcity.

| TELECOM & DATA: +5.4% in 9M 2021 continued restoration boosted by LAN & Techniques

Telecom & Information gross sales amounted to 241 million euros at customary steel costs within the first 9 months of the yr, up +5.4% organically (excluding Berk Tek bought in third quarter 2020) in comparison with first 9 months of 2020 and up +11.3% in third quarter 2021 displaying a rebound in demand throughout the three actions.

LAN cables and Techniques rebounded by +20.7% organically within the first 9 months 2021 and +8.8% in third quarter 2021 due to continued upturn in each in Asia and Europe.

Telecom Infrastructure was down -2.0% within the first 9 months of 2021 however up +11.5% within the third quarter according to second quarter momentum due to France and Belgium continued upturn greater than offsetting softer market demand within the Nordics. Pricing strain was mitigated due to price reductions and competitiveness measures.

Particular Telecom (Subsea) gross sales continued to carry out nicely, up +11.0% because the starting of the yr and +13.9% within the third quarter due to Nexans’ main place.

| HIGH VOLTAGE & PROJECTS: -6.0% in 9M 2021; return to development as anticipated in Q3 (+8.0% year-on-year) paving the best way to a powerful finish of the yr; adjusted Subsea backlog⁷ at €1.5bn

Excessive Voltage & Tasks customary gross sales stood at 520 million euros within the first 9 months of 2021, down    – 6.0% year-on-year, according to undertaking phasing and unfavorable comparative with first half 2020 which had benefitted from three restore contracts. Progress was +8.0% within the third quarter reflecting undertaking phasing and ramp up of Charleston plant greater than offsetting Skagerrak vessel upkeep. State-of-the-art Nexans Aurora cable laying vessel ceremony occurred in September 2021 with purchasers and authorities officers.

Consistent with the Group’s flawless and disciplined undertaking execution, progress was made on interconnector tasks reminiscent of NSL, Crete-Attica and Offshore Wind farm tasks Seagreen and Dolwin6 EPCI contracts combining subsea and land excessive voltage cables, engineering and set up actions. Adjusted Subsea backlog⁷ was at 1.5 billion euros on the finish of September, up +6.6% in comparison with June 2021. Each Halden and Charleston are absolutely loaded till the top of the yr. Tendering exercise continued to be robust in each interconnection and offshore wind tasks. Benefiting from its EPCI turnkey mannequin positioning, the Group was awarded aftermarket companies for Kintyre-Hunterston and Parkwind subsea transmission cable hyperlinks. Nexans’ groundbreaking deep-water excessive voltage dynamic cable was chosen for Jansz-Io Compression undertaking in Australia.

| OTHER ACTIVITIES

The Different Actions section – corresponding for probably the most half to copper wire gross sales and together with company structural prices that can’t be allotted to different segments, such because the IFRS 16 affect for lease belongings not allotted to particular actions – reported gross sales of 854 million euros at customary steel costs in first 9 months 2021, up +27.8% year-on-year primarily linked to robust copper wire demand in North America. The section was down -6.8% within the third quarter reflecting Group’s monitoring and discount of exterior copper gross sales.

III.   2021 Outlook

Following its first 9 months efficiency and, based mostly on present macro-economic setting and assuming no materials affect from COVID-19 and steel worth will increase, the Group confirms its targets for 2021 upgraded in July 2021:

• EBITDA between 430 and 460 million euros;
• Return on capital employed (ROCE) between 13% and 15%;
• Free Money Stream earlier than M&A and fairness operations between 100 and 150 million euros.

IV.   Considering Surroundings, Social and Governance affect of our actions

Throughout the third quarter, Nexans made vital progresses in the direction of its bold Company Social Accountability technique and dedication to contribute to carbon neutrality:

• Nexans introduced collectively Nordic Power Leaders to fight local weather change at its second annual Nexans Local weather Day in Stockholm. Designed as a free debate between those that will design the electrification of the longer term, the Nexans Local weather Day “Sustainable electrification – Making Local weather Imaginative and prescient a Actuality” introduced collectively international power specialists to debate the challenges in driving the sustainable electrification of the world, and the important thing function of the power sector within the combat in opposition to local weather change.
• Engaged in sustainable buying practices, the Group joined the Copper Mark as a associate dedicated to advertise accountable copper manufacturing, being the primary cable producer to hitch the group aligned with United Nations objectives.
• From a governance standpoint, upon advice of the Appointments and Company Governance Committee, the Nexans Board of Administrators has resolved to nominate Laura Bernardelli as censor and suggest her election as an impartial director to the shareholders’ assembly of Could 11^th, 2022. If that’s the case appointed, Laura will succeed Kathleen Wantz-O’Rourke.

V.   Vital occasions because the finish of September

October 14 – TotalEnergies chooses Nexans photo voltaic trackers to recycle a landfill website right into a photo voltaic farm. Nexans revolutionary KEYLIOS photo voltaic trackers had been put in on the La Fenasse website, a former Technical Landfill Heart situated close to Béziers in southwestern France, which is at present being transformed to a 1.6 MW photo voltaic photovoltaic (PV) farm.

October 5 – Nexans has received a contract with Parkwind to offer turnkey enterprise continuity companies to 4 of its offshore wind farms in Belgium. The five-year partnership will see Nexans offering a variety of companies reminiscent of pre-engineering of potential restore scenarii, periodic spare inspections and emergency response time of restore vessel in case of contingency scenario on each inter-array and export cables.

October 4 – Nexans is awarded a major turnkey contract to produce and set up a groundbreaking deep-water excessive voltage dynamic cable resolution for the Jansz-Io Compression (J-IC) undertaking operated by Chevron Australia.

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Monetary calendar

February 16, 2022:                 2021 full-year earnings

About Nexans

For over a century, Nexans has performed a vital function within the electrification of the planet and is dedicated to impress the longer term. With round 25,000 individuals in 38 international locations, the Group is main the cost to the brand new world of electrification: secure, sustainable, renewable, decarbonized and accessible to everybody. In 2020, Nexans generated 5.7 billion euros in customary gross sales.
The Group is a pacesetter within the design and manufacturing of cable programs and companies throughout 4 most important enterprise areas: Constructing & Territories, Excessive Voltage & Tasks, Trade & Options and Telecom & Information.
Nexans is the primary firm of its business to create a Basis supporting sustainable initiatives bringing entry to power to deprived communities worldwide. The Group pledged to contribute to carbon neutrality by 2030.

Nexans. Electrify the longer term.

Nexans is listed on Euronext Paris, compartment A.
For extra data, please go to www.nexans.comwww.nexans.com

Contacts:

NB: Any discrepancies are attributable to rounding

This press launch accommodates forward-looking statements that are topic to varied anticipated or sudden dangers and uncertainties that would have a fabric affect on the Firm’s future efficiency.

Readers are invited to go to the Group’s web site the place they’ll view and obtain the 2020 monetary statements and Nexans Common Registration Doc, which features a description of the Group’s threat elements. 

¹ To neutralize the impact of fluctuations in non-ferrous steel costs and subsequently measure the underlying gross sales development, Nexans additionally calculates its gross sales utilizing customary costs for copper (customary worth at 5,000 €/t) and aluminum (customary worth at 1,200 €/t).
² The primary 9 months of 2021 gross sales determine used for like-for-like comparisons corresponds to gross sales at customary non-ferrous steel costs, adjusted for the results of change charges and adjustments within the scope of consolidation. Change charges and adjustments within the scope of consolidation impacted gross sales at customary non-ferrous steel costs by +€5m and -€152m respectively.
³ Adjusted subsea backlog together with contracts secured not but enforced.
⁴ Topic to regulatory approval.
⁵ Steering confirmed for EBITDA, ROCE and FCF.
⁶ Excluding Chester plant within the US, closed in 2020
⁷ Adjusted subsea backlog together with contracts secured not but enforced.

• Nexans_Third quarter 2021 Press release_Final