Prysmian has reported a drop in earnings for the full year 2014.
Italy’s cables manufacturer said its full year adjusted net profit amounted to 186 million euros.
Excluding the adverse impact of the Western Link project (€66 million net of tax effects), adjusted net profit would have been €252 million, down approximately 6% compared with €269 million in 2013.
Net profit amounted to €115 million compared with €153 million in 2013 (down approximately 33% year-over-year), and was heavily affected by the Western Link project and by €44 million in impairment losses recognised against property, plant and equipment and intangible assets, mainly in connection with those markets particularly hard in recent years, like Italy, Oceania and Brazil (for flexible pipes).
Group Sales amounted to €6,840 million, posting organic growth of +1.8% assuming the same group perimeter and excluding metal price and exchange rate effects (excluding the adverse impact of the Western Link project, organic growth would have been +2.7%). The decisive contribution to this good sales performance came from submarine cables and systems, where the Group had double-digit growth, proving, through this demonstration of market confidence, to have more than overcome the impact of the problems arising with the Western Link project.
Telecom Cables also posted a solid recovery, while Trade & Installers saw an upturn in volumes. Performance by High Voltage Cables and SURF was broadly in line with 2013, while there were no signs of recovery for Power Distribution. Performance by certain segments of the Industrial Cables OEM market was affected by increased competitive pressure, while Oil & Gas was affected by market sector weakness, nonetheless delivering a performance in line with 2013.
With reference to its submarine cables business, Prysmian expects that the impact of the Western HVDC Link project posted in 2014 (€94 million on Adjusted EBITDA) will be significantly lower in 2015.
“Our Group’s performance in 2014 confirms signs of a slight recovery in sales volumes, accompanied by a generally stable level of profitability,” commented CEO Valerio Battista. “The decisive contributions to this result were from the strategic Submarine Cables and Systems businesses, with strong growth, and from Optical Cables, with recovering volumes and profitability.”