Q1 Group Sales €3,992 million, with High Voltage Submarine Power Cable up 29.5%
Prysmian group released
their Q1 results today. In it they identified that Group Sales amounted
to €3,992 million, Profits
rising by nearly 50%
with a +9.0% organic growth This was a better-than-expected performance
in almost all businesses and geographical areas.
Their report highlighted
strong acceleration of the sales organic growth (+29.5%) from their Projects
segment, in the main attributable to submarine cables and systems,
which are used both for developing interconnections and for connecting
offshore wind farms that are strategic to the energy transition.
“The first quarter
of 2023 closed with better-than-expected results, further confirming the
solid and long-term nature of the drivers that had fuelled our extraordinary
growth in 2022,” stated CEO Valerio Battista. “All the businesses and
geographical areas performed well, particularly the sectors that play a
strategic role in the energy transition and electrification processes —
from submarine cable systems for large interconnections and offshore wind
farms to cable for grid hardening, and applications for wind and solar
renewable energy generation. Worth of mention is our ability to translate
business results into cash generation, thus contributing to improving our
net financial debt. In short, after having reported our best ever results
in 2022, this excellent start to the year confirms the competitiveness
of our product range and our technology innovation capacity, the quality
and reliability of our supply chain and customer service, as well as our
execution capabilities for the important projects in the order book,”
The Energy segment’s
sales recorded a +6.6% organic growth, mainly driven by long-term drivers,
such as electrification,
grid hardening and wind and solar energy generation. Medium-voltage cables
and overhead lines recorded
a +12.2% organic growth. Sales of the renewables segment also improved.
Telecom recorded a +5.7% organic
growth, chiefly thanks to the demand for optical cables for the development
of broadband networks.
Projects revenues amounted
to €563 million, with a +29.5% organic growth compared to Q1 2022. Adjusted
EBITDA rose to €56
million (€32 million in Q1 2022), with a Sales improvement of 10.0%
compared to 7.8%
for Q1 2022.
The sales growth of the Projects segment was driven in particular by
the High Voltage Submarine Power Cable
and System business,
which provides strategic technological solutions for the development of
and cabling of offshore wind farms for the energy transition.
Prysmian stated this is an industry which went from an average of
approximately €3 billion of projects
assigned a year
until 2019 to approximately €13 billion of projects expected for 2023
and the coming years.
Prysmians profitability improvement was in their view attributable to both
a thorough approach in the selection of the projects to be acquired, thanks
to the full utilisation of the production assets, and the execution of
the projects in the order book. In particular, the execution of the major
German Corridor continued in line with expectations.
The Group has recently been awarded a new contract worth €800 million
for the Biscay Gulf project relating to a
new submarine power
interconnection between France and Spain on behalf of INELFE, a 50:50 joint
the Spanish grid operator Red Eléctrica and the French grid operator Réseau
de Transport d’Électricité
(RTE). The project falls within the European Commission’s Projects of
Common Interest, as it increases power
enables the further integration of renewable energy into electricity grids
and contributes to creating
a more efficient system.
This latter contract adds to two projects IJmuiden Ver Alpha and Nederwiek
1 of a total worth of approximately
€1.8 billion, for
the connection of offshore wind farms in the Netherlands, acquired in the
first quarter of the year. IJmuiden
Ver Alpha and Nederwiek 1 are the first projects in which the Prysmian
Group uses the 525 kV HVDC
submarine cable, an extremely innovative technology, developed to enable
the construction of lines with capacity
of 2 GW.