Nexans to become the first electrification pure player

• Electrify the Future - Bedrijfsmodel van Nexans gericht op electrificatie, van energieopwekking tot transmissie en distributie tot het verbruik van energie
• Simplify to amplify - Nexans zal zich richten op vier sectoren en schaalvergroting door organische en anorganische versterking
• 200 miljoen euro investering in Subsea High Voltage tot 2023 - Nexans zal in Noorwegen en de VS investeren om de enorme groei van duurzame elektrificatie te beantwoorden.
• Financiële ambities voor 2024 uiteengezet - Nexans zal haar portefeuille verleggen naar pure elektrificatie, meerwaarde creëren om prestaties en kasstroomgeneratie aanzienlijk te verbeteren en tegelijkertijd een robuuste balans handhaven en zich verbinden aan een stijgend dividend

Parijjs, 17 februari 2021 - Nexans heeft vandaag haar jaarlijkse Virtuale Capital Markets Day gehouden. Christopher Guérin, CEO, Jean-Christophe Juillard, CFO en andere leden van het Executive Committee hebben de industriële ambitie, de operationele routekaart en de financiële doelstellingen van de Groep voor 2021-2024 toelichten.

Sinds 2018 heeft Nexans een diepgaande transformatie ondernomen om een slankere, meer klantgerichte en winstgevende Groep op te bouwen. In slechts twee jaar tijd heeft de succesvolle invoering van het Nieuwe Nexans-bedrijfsmodel, de Groep in staat gesteld haar waarde te verhogen en een sterke financiële voet aan de grond te krijgen.

Vanaf nu is Nexans gericht op groei.

Our strategy: from a generalist cable manufacturer to pure electrification player

For the last 120 years, Nexans has played a major role in the world’s electrification. This market represents 65% of the world cable market and is expected to grow by +4.3% per annum over the next 10 years driven by key growth trends: growing energy consumption, demand for sustainable energies, grid modernization and protection. The world is becoming more electric and carbon neutral. Likewise, customer needs are changing from cables to systems and interconnected solutions.

Convinced that remaining a generalist will be more a weakness than a strength, Nexans intends to become a pure electrification player.

Simplify to Amplify. The Group will simplify its business model by moving from 8 macro sectors, representing 34 subsectors, to 4 sectors, representing 12 subsectors. Nexans will become a unique fully integrated player covering the entire electrification value chain: from the very start of production of energy, to transmission and distribution of energy, all the way to usage of energy.

The Group will amplify its impact through two axes:

• Pursue transformation program on all segments through 3 main actions: i) deploy an updated activity portfolio management method, enabling a stronger focus on cash generation; ii) continue the implementation of cost and productivity improvement programs; and iii) implement SHIFT Performance program wherever still needed.
• Amplify and accelerate growth on electrification segments through: i) both on transformative deals and bolt-on acquisitions; ii) SHIFT Prime program focused on customer and innovation, and iii) innovations and partnership programs thanks to its global R&D capabilities, partner ecosystem and digital solutions.

Our purpose: “Electrify the future”

Nexans will position all its operations across the electrification value chain. From Generation and Transmission to Distribution and Usages. The Group will enhance its positioning in the Offshore Windfarms and Interconnection markets notably through additional 200 million euros investments, while maintaining a value proposition based on three pillars: i) Risk & project portfolio management, ii) Asset management, and iii) Cutting-edge technology. In Distribution, Nexans will reinforce its turnkey solutions combining cables and accessories with installation, architecture design, smart systems and asset management. In Usages, the Group will focus its offer on end-user electrical safety, support to client competitiveness through seamless supply chain for easy to handle and install products, and smart products integrated in a digital ecosystem.

Nexans will lead the electrification of the future in a sustainable way. As announced during its Climate Day on September 22, 2020, Nexans will reach carbon neutrality by 2030.

2021-2024 financial targets: accelerate value growth and cash generation

By 2024, Nexans will become a 6 to 7 billion euros standard sales pure Electrification player, with higher profitability - EBITDA expected between 10% to 12% of sales and stronger cash generation between 500 to 600 million euros before M&A and equity operations.

First, on its existing Electrification portfolio, the Group aims to generate standard sales of 3.5 to 3.7 billion euros and an EBITDA margin of 11% to 13% compared to 8% to 10% in 2021. To reach this stage in its development, the Group intends to continue to streamline its cost base and improve industrial performance, build on its smart innovations, ramp-up of its investments in state-of-the-art Aurora vessel and the expansion of its Charleston high-voltage subsea plant in the USA, as well as the additional capacity investments in High-Voltage & Projects business.

Second, the Group will rotate the remaining of its portfolio through divestments while also target transformative deals and bolt-on acquisitions to complete its electrification offer and enable Nexans to scale-up with a new value proposition. The related EBITDA improvement is expected between +50 to +150 bps.

Nexans will also maintain strict financial discipline with a leverage ratio1 of less than 2.5. Over the next three years, the Group's cash generation before M&A is expected between 500 and 600 million euros to finance capex investments, raise shareholder returns to achieve a dividend pay-out ratio above 20% and become debt-free by 2024.

Nexans will hold today at 2:00 p.m. CET a virtual investor and analyst conference.
Live webcast link: https://channel.royalcast.com/landingpage/nexans/20210217_2/
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• France: +33 (0) 1 7037 7166
• United Kingdom: +44 (0) 33 0551 0200
• United States: +1 212 999 6659
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