Nexans : Nexans : 2013 First-Quarter Financial Information
2013 First-Quarter Financial Information
*Activity in the first quarter fell 3.4% at current scope and 5.6% at
constant scope as a result of a high baseline effect (strong first quarter
*Stable price environment
*Strong growth in submarine transmission reflecting a gradual return to
normal at operational level
*Implementation of the measures designed to deliver benefits in 2014 and
2015 from the strategic initiatives announced in February 2013
Paris, April 25, 2013 - Nexans today announced 2013 first-quarter sales of
1.668 billion euros, that is, 1.130 billion euros at constant non-ferrous
metal prices^. The corresponding figure for the first quarter 2012 was
1.169 billion euros resulting in an organic contraction of nearly 5.6%^.
As the company was expecting, the first quarter 2013 saw a significant organic
contraction caused by the combined effect of a high first-quarter 2012
baseline, a deteriorating global economy in the second half of 2012 and
unfavorable weather conditions that delayed the installation of infrastructure
This contraction resulted in a sharp slowdown in non-high voltage activities
(-8%) in all geographical areas and in all businesses. Within this same scope,
there was a sequential contraction (the first quarter 2013 compared with the
last quarter 2012), except in Europe which rose 1.7%. Within this same
context, the Group has not noted any price decreases.
High voltage activity rose, at a constant scope, overall by 8.3%, of which
submarine cables by 22.3% reflecting the gradual return to normal in Norway.
The start is slower in land high voltage but sales should increase in the
The company is expecting a second quarter 2013 to be significantly higher in
particular following the especially unfavorable weather conditions and a
correction in the land high voltage trend (see above).
Finally, the Group is putting in place the operational levers to improve
performance in 2014 and 2015. Additionally, in Europe, the Group is mobilizing
its teams to prepare a plan to generate savings which will be subject to
consultation with employee representatives in the third quarter.
CONSOLIDATED SALES BY BUSINESS
Q1 2012 Q1 2013 Organic Organic
(millions of euros) At constant At constant Q1 2013 vs. Q1 2013 vs.
metal prices metal prices Q1 2012 Q4 2012
Distributors and 332 295 -10.1% -3.1%
Industry 281 294 -2.5% -3.4%
Transmission, Distribution 481 470 -4.5% -13.2%
o/w Transmission +8.3% -25.5%
Other 75 71 -4.9% 3.7%
Group total 1,169 1,130 -5.6% -7.3%
With sales of 295 million euros, the Distributors & Installers business
reported an organic contraction of 10.1% compared with the first quarter 2012.
This evolution is mainly attributable to the sharp slowdown in Europe in the
middle of last year resulting in a very unfavorable base effect on the first
The sequential analysis reveals an organic contraction of 3.1% reflecting a
good performance in Brazil, steady sales in Europe and a slowdown in the other
In Europe, France showed a strong resilience compared with the last quarter.
On the other hand, sales in Scandinavia tapered because harsh weather
conditions slowed progress at construction sites.
Activity in North America was impacted by heavy stock reductions for mining
projects, especially in Canada.
In Asia-Pacific, the trend remains positive in South Korea, whereas the
situation in Australia remains delicate because of weak demand from the main
distributors. A reorganization plan involving 60 employees has been launched.
Industry business sales come to 294 million euros, that is, an organic
contraction of 2.5% compared with the first quarter 2012. This reflects weaker
activity in Europe in some capital goods segments starting in the second
The sequential analysis reveals an organic contraction of 3.4% for this
sector. This figure breaks down into the following contrasting trends:
*the good performance of automotive harnesses in Europe, which continue to
benefit from their position with high end German automotive manufacturers,
reporting double-digit growth;
*stable performance by the transportation sector in the first three months
of the year, both in Europe and in Asia. Growth in Europe is driven by
sales to the aeronautical, railways and shipbuilding industries; in Asia,
growth contracted sharply in China attributable to the two weeks of
Chinese New Year during which activity all but ceases. In South Korea,
dynamic offshore activity offset the more tempered rate in shipbuilding in
the first quarter;
*ongoing weak demand in the other European capital goods/automation
segments among others and a cable inventory reduction effect in the
resources sector in North America.
Sales for the Transmission, Distribution and Operators segment reported an
organic contraction of 4.5% from 481 million euros in 2012 to 470 million
euros in 2013.
Transmission (high voltage) reported organic growth of 8.3% compared with the
first quarter 2012.
For land high voltage cables, the expected slow start should correct itself in
the second quarter. The bidding activity in response to call for tenders
remains active ; the Westermost Rough Wind Farm contract has been recently
Submarine high voltage business grew by 22.3% compared with the first quarter
2012. The Halden plant is gradually regaining a normal level of production.
The improvement to the margin will be felt more strongly at the end of 2013,
after delivering those contracts with their margins affected by the
operational difficulties experienced in 2012.
Distribution and Operator business posted an organic contraction of 11.2%
compared with the first quarter 2012. This is attributable to the sharply
slowing sales since the second half 2012 in the MERA, South America and
Asia-Pacific areas, and to a lesser extent in the European markets.
The sequential analysis reveals a 3.4% contraction compared with the last
quarter. It reflects a slightly positive trend in Europe and Latin America
(Peru), but negative in North America and the MERA area (Morocco in
Operator business sales rose sharply largely because copper cable business
continues to trend well in Lebanon and Latin America.
Sales for Other business came to 71 million euros, reflecting negative organic
growth of 4.9% compared with the first quarter 2012.
For the purposes of consolidating Nexans by the equity method in the Madeco's
first-quarter consolidated accounts, the following non-operational accounting
data is provided: change in shareholders' equity linked to the fair value of
metal hedging instruments (-9 million euros), change in shareholders' equity
attributable to conversion differences (+39 million euros), and core exposure
effect (-3 million euros).
There will be a telephone conference (in English) today at 10:00 a.m. (GMT+1).
The local numbers to call are:
*In France: 01 70 77 09 43
*In the UK: +44 (0) 203 367 9458
*In the USA: +1 866 907 5924
The local numbers to call to listen to a repeat of the conference (available
within 2 hours) are:
*In France: 01 72 00 15 00 (in English)
*In the UK: +44 (0) 203 367 9460
*In the USA: +1877 642 3018
To listen to the conference, when requested, please dial 281428 followed by
the pound (#) sign.
May 14, 2013: Annual Shareholders' Meeting
May 30, 2013: Individual shareholder information meeting in Lille*
July 25, 2013: 2013 first-half financial results
* Provisional date subject to change
Readers are also invited to log onto the Group Internet site where they can in
particular consult the presentation of the annual results to analysts, the
full financial statements for the year ended at December 31^st, 2012 and the
registration document for 2012 including details of risk factors for the Group
and confirmation of the risks related to the competition investigations in
Europe, the United States, Canada, Brazil, Australia and South Korea for
alleged anticompetitive behavior in submarine and underground power cables and
associated services and equipment, the results and consequences of which could
have a material adverse effect on the Group's results and thus its financial
Information of a prospective nature in this press release is dependent on the
risks and uncertainties, known or unknown at this date, that may impact on the
Company's future performance, and which may differ considerably.
In addition to the risk factors, the main uncertainties weighing on 2013
concern in particular:
*The global economic environment
*The resilience of energy infrastructure markets in emerging countries
*The growth of renewable energy and the oil & gas markets, as well as
clients' investment programs in these segments
*The recovery of cables for industry in certain segments of the
transportation industry, such as shipbuilding, automation and the growth
of railways in China
*The Group's ability to improve its profitability and increase its
*The assumption of limited impact in 2013 of the competition investigations
commenced in 2009, and in any event consistent with the accounting options
*The Group's ability to integrate its acquisitions, benefit from its
partnerships and complete planned divestments under the best possible
*The risk of client credit, especially in Europe and Egypt, and even more
particularly in Greece where credit risk is no longer insurable
*The business risk in the Middle East and in North Africa.
With energy at the basis of its development, Nexans, worldwide expert in the
cable industry, offers an extensive range of cables and cabling solutions. The
Group is a global player in the energy transmission and distribution, industry
and building markets. Nexans addresses a wide series of market segments: from
energy and telecom networks to energy resources (wind turbines, photovoltaic,
oil and gas, and mining) to transportation (shipbuilding, aerospace,
automotive and automation, and railways). Nexans is a responsible industrial
company that regards sustainable development as integral to its global and
operational strategy. Continuous innovation in products, solutions and
services, employee development and commitment, customer orientation and the
introduction of safe industrial processes with limited environmental impact
are among the key initiatives that place Nexans at the core of a sustainable
With an industrial presence in 40 countries and commercial activities
worldwide, Nexans employs 25,000 people and had sales in 2012 of nearly 7.2
billion euros. Nexans is listed on NYSE Euronext Paris, compartment A.
For more information, please consult: www.nexans.com
Financial Communication Communication
Michel Gédéon Jean-Claude Nicolas
Tel: +33 (0)1 73 23 85 31 Tel : + 33 (0)1 73 23 84 51
e-mail: email@example.com e-mail : firstname.lastname@example.org
Laura Duquesne Angéline Afanoukoe
Tél: + 33 (0)1 73 23 84 61 Tel: + 33 (0)1 73 23 84 12
e-mail : email@example.com e-mail: firstname.lastname@example.org
Tél: + 33 (0)1 73 23 84 56
(in millions of euros)
At current metal prices 1,752 1,668
At constant metal prices 1,169 1,130
Sales at current metal prices by business
Transmission, Distribution and Operators 582 581
Industry 364 377
Distributors & Installers 579 513
Other 228 197
Total Group 1,752 1,668
Sales at constant metal prices by business
Transmission, Distribution and Operators 481 470
Industry 281 294
Distributors & Installers 332 295
Other 75 71
Total Group 1,169 1,130
To neutralize the effect of variations in the purchase price of
non-ferrous metals and therefore measure the underlying sales trend, Nexans
also calculates its sales using a constant price for copper and aluminum.
The 2012 sales on the basis of comparable data correspond to constant
non-ferrous metal sales, recalculated after adjustments for exchange rates and
scope. The exchange effect on 2012 first-quarter sales at constant non-ferrous
metal prices is -6 million euros and the scope effect is 32 million euros.
130425-Nexans Q1 13-GB
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