WINDS OF CHANGE - 17 FEBRUARY 2021
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WINDS OF CHANGE 17 FEBRUARY 2021
01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
SAFE HARBOUR
NB: Any discrepancies are due local content requirements; operating profit and financial might occur in particular in the industry which has led our and for imposing changes to – The inherent risks associated Without having major
to rounding. position; context of further waves of the customers to revisit their order the agreed delivery schedules with major capital projects, operational impacts, the two
– Geopolitical and political
coronavirus pandemic; books for the coming months for contracted projects in the particularly the risk of following uncertainties may
This presentation contains instability, particularly in certain – The increase in credit risk
and years; context of the coronavirus completion delays and the risks have an impact on the financial
forward-looking statements countries, cities or regions such in certain countries (including – In the current context of
pandemic. of delays to win projects to fill statements:
which are subject to various as Qatar, Libya, Lebanon, Iraq, Brazil, Morocco and Turkey) in marked increase in non- – The fact i) that automotive
the new capacities. These risks
expected or unexpected risks the Persian/Arabian Gulf, Hong the context of the coronavirus ferrous metal prices, should sales may continue to be – The risk of the award or entry – Sudden changes in metal
notably concern the construction
and uncertainties that could Kong, Ivory Coast and Nigeria; pandemic; this increase trend continues adversely affected in the context into force of subsea and land prices that may affect customers’
of a new subsea cable laying
have a material impact on the it might have on impact of the of the coronavirus pandemic cable contracts being delayed buying habits in the short term;
– The instability of banking – Political, social and economic ship, the transformation of
Company’s future performance. non-ferrous market which could on a global basis with issues in or advanced, which could
system in Lebanon and uncertainty in South America, the Charleston plant in North – The impact of foreign
potentially lead to rarefaction of components supplies and slower interfere with schedules in a
Readers are also invited to visit uncertainties on the Lebanese such as in Brazil, Venezuela and America to produce subsea high exchange fluctuations on the
non-ferrous metal offers; recovery of the cars demand, given year;
the Group’s website where pound; Bolivia, which is i) affecting the voltage cables, two projects that translation of the financial
as well as that ii) the progress
they can view and download building market as well as major – The sustainability of growth – Inherent risks related to i) will be instrumental in ensuring statements of the Group’s
– The impact that the of electrical propulsion solutions
the 2020 annual results press infrastructure projects in the rates of the fiber and copper carrying out major turnkey that we meet our objectives; subsidiaries located outside the
coronavirus pandemic and the will penetrate markets slower
release as well as the 2020 region (such as the Maracaibo structured cabling (LAN) market projects for high-voltage cables, euro zone.
adoption by State authorities, than predicted; – The challenges created by
financial statements and project in Venezuela), ii) and the Group’s capacity to which will be exacerbated
in many countries around the the coronavirus pandemic Scenarios considered in the
Nexans Universal Registration creating exchange rate volatility seize opportunities relating to – Fluctuating oil and gas prices, in the coming years as this
world, of national restrictive (with subsequent measures current presentation will be
Document, which includes a and iii) increasing the risks of the move to higher performing and the downturn in the Oil & business becomes increasingly
measures (including prolonged taken by national States such further analyzed prior to
description of the Group’s risk customer default; categories in this market; Gas sector which have lead concentrated and centered on
measures to control the as country lockdowns or travel deciding their implementation
factors. Oil & Gas sector customers to a small number of large-scale
pandemic such as travel bans, – A marked drop in non-ferrous – The speed of deployment bans) for the performance of and projects resulting from those
revise their exploration and projects, ii) the high capacity
In addition to the risk factors curfews and country lockdowns) metal prices resulting in the of “ftth” (“fiber to the home”) projects in countries like the studies will be submitted to
production capex programs. utilization rates of the plants
described in Section 3.1 of the in particular in the context of impairment of Core exposure solutions in Europe and North United States (e.g. to meet relevant legal bodies including
The considerable uncertainty involved, iii) the projects’
2020 Universal Registration further waves of the pandemic (non-ferrous metal owned by West Africa and the Group’s the defined manufacturing to employees’ representative
about the implementation geographic location and the
Document, the uncertainties for in countries around the world Nexans and integral part of capacity to seize opportunities schedule in Charleston) as well bodies if applicable and when
of these customers’ capex political, social and economic
2021 mainly include: together with the appearance the production chain), not relating to the development of as for turnkey projects such as needed.
programs may also affect the environments in the countries
of variants to the coronavirus having an impact on cash or this market; Seagreen (United Kingdom) and
– The impact of protectionist Group’s ability to plan for future concerned (such as Philippines
(including in UK, Brazil and operating margin, but impacting Visayas-Mindanao (Philippines)
trade policies globally, as well – The impact of the coronavirus means of producing cables and for Visayas-Mindanao project);
South Africa) could have on net income. Such marked drop and onshore projects in Europe.
as growing pressure to increase pandemic on the aeronautic umbilicals for these customers,
our Group’s business prospects, in non-ferrous metal prices
INVESTOR RELATIONS:
Contact: Aurélia Baudey-Vignaud
Telephone: +33 1 78 15 03 94
Email: aurelia.baudey-vignaud@nexans.com
002 @2021 Nexans CMD presentation
01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
INTRODUCTION
FOCUS ON THE
WORLD’S
ELECTRIFICATION
003 @2021 Nexans CMD presentation
01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
1879
120
YEARS’
2001
NEX ANS
IPO
2018
NEW
NEX ANS
EDISON PATENTED THE
FIRST COM MERCIALLY INDUSTRIAL COMPANY
SUCCESSFUL BULB
Nexans is at the
heart of electricity
and pioneer of its
deployment
1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050
004 @2021 Nexans CMD presentation
01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
ELECTRIFICATION
IS IN OUR
DNA
It is at the heart of our existence.
It is the reason why we give the
best of ourselves to build a better
future for the world.
ELECTRIFY
THE
0 1990 2000 2010 2020 2030 2040 2050 FUTURE
005 @2021 Nexans CMD presentation
01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
ELECTRIFY
OUR
PURPOSE
THE
FUTURE Our past, present
and future converge
to electrification
006 @2021 Nexans CMD presentation
01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
OUR WE ARE PIONEERS
VALUES OF ENERGY TRANSITION.
WE ARE DEDICATED
TO DELIVERING TO THE HIGHEST
STANDARDS OF PERFORMANCE.
WE ARE UNITED
TO ACHIEVE OUR AMBITIOUS
GOAL: ELECTRIFY THE FUTURE.
007 @2021 Nexans CMD presentation
01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
OUR
A
COMMITMENT
CARBON
NEUTRAL
COMPANY
BY 2030
008 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
SIMPLIFY
OUR
STRATEGY
OUR BUSINESS
TO AMPLIFY
OUR IMPACT
009 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
OUR
SOLUTIONS FROM
GENERATION OF ENERGY,
TO TRANSMISSION OF ENERGY,
TO DISTRIBUTION OF ENERGY,
TO USAGE OF ENERGY
010 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
OUR
PURPOSE
ELECTRIFY THE FUTURE OUR
OUR PATH
VALUES OUR VALUE GROWTH
WE ARE PIONEERS OF
STRATEGY BY FOCUSING ON
ELECTRIFICATION
ENERGY TRANSITION. SIMPLIFY
WE ARE DEDICATED TO OUR BUSINESS OUR
DELIVERING TO THE HIGHEST TO AMPLIFY
STANDARDS OF PERFORMANCE. OUR IMPACT COMMITMENT
WE ARE UNITED TO ACHIEVE A CARBON NEUTRAL
OUR
OUR AMBITIOUS GOAL: COMPANY BY 2030
ELECTRIFY THE FUTURE. SOLUTIONS
FROM GENERATION OF ENERGY,
TO TRANSFORMATION OF ENERGY,
TO DISTRIBUTION OF ENERGY,
TO USAGE OF ENERGY
011 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
WHAT IS Distributed generation
(Utility scale)
Distributed generation
(Private)
ELECTRIFICATION?
Offshore wind
Residential
Onshore wind
Datacentres
Solar Infrastructures
Hydro Industrial
Centralised Transmission Distribution Usages
generation subsea and land Commercial
Nuclear
Mobility
Fossil
GENERATION AND TRANSMISSION DISTRIBUTION USAGES
012 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
RE
E D TU
Y RN
A LICENCE M
P LO
ENVIRONMENT FINANCIALS
O
E
MANAGEMENT
TO OPERATE
N
N
CA
BO
CIRCULAR 1 1 CUSTOMERS
AR
E
ECONOMY
PI
3
TA
NC
EC
2 2
N T
L EM
E
RETURN O
CLIMATE
M INNOVATION
O
ENVIRON
3 3
NO
PLOYED
MIC
LOW CARBON
OFFER 4
E
3 4 COMPETI-
TIVENESS
EN
GAGEMEN
T
COMMITTED
TO PERFORM 1
2 3
4
INCLUSION
AND DIVERSITY SAFETY
SUPPLIER
LEARNING
RE ENGAGEMENT
D
TU G E
RN A
ON EN G
COMPETENCE
013 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
2020 2024
WINDS
OF
CHANGE FROM: TO:
Nexans is historically a 6 Billion Euro generalist Nexans will simplify to amplify its role
covering 8 macro sectors offering mainly components as Electrification Pure Player
A €6bn COMPANY A COMPANY
SUPPORTED BY SUPPORTED BY
8 MACRO
SECTORS
Buildings Territories Industry Harnesses
4 MACRO
SECTORS
Generation & Transmission Distribution Usage
34 SUBSECTORS 12 SUBSECTORS
Telecom Subsea Inland Metallurgy
Network Grid Grid
Sales: Sales:
2020
2024
OTHERS 45% 55% ELECTRIFICATION €6bn 100% ELECTRIFICATION
014 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
TIME TO
MAKE
CHOICES 02 04
WHY HOW
CHANGE? TO CHANGE?
An increasingly Transform
electric world and innovate
03 05
WHAT NEW FINANCIAL
TO CHANGE? TRAJECTORY
Simplify our business. Scale-up to
Amplify our impact. step-up performance
015 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
WHY
CHANGE?
AN INCREASINGLY
ELECTRIC WORLD
016 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
2021 TO 2050 THE WORLD WILL BECOME ELECTRIC AND CARBON NEUTRAL.
ONLY A DECADE TO MAKE THE BIG SHIFT
POPULATION
GROWTH
ELECTRICITY
DEMAND
RENEWABLE
ENERGIES $2 TRILLION
BIDEN PLAN
11,763
9.7
4.4
$2tn to achieve 100% clean energy
& net-zero emissions at latest 2050
8.5
3.8
7.8
3.5
$1 TRILLION
7,037
EUROPE GREEN DEAL
4.1
$1tn investments over next 10 years
1.4
2,707
843
CARBON-NEUTRAL
CHINA GREEN DEAL
2000
2019
2030
2040
1975
2020
2030
2050
1975
2019
2030
2040
China to be carbon-neutral state by 2060*
WORLD POPULATION ELECTRICITY DEMAND RENEWABLE CAPACITY *On September 22 at the UN headquarters, President Xi Jinping announced a plan to
(BILLION PEOPLE) (MWH/CAPITA) (GW) make China a carbon-neutral state by 2060 and to reach an emissions peak by 2030
017 – Data source: Roland Berger
@2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
ELECTRIFICATION RISKS RISE FASTER THAN SOLUTIONS. ACTION IS NEEDED
MAJOR FIGHT GLOBAL WARMING & BIODIVERSITY ATTRITION AVOID BLACKOUT IN BIG CITIES GUARANTEE END USERS ELECTRICAL SAFETY
UPCOMING RISKS
NEW NEEDS
GREEN DEAL NEEDED GRID MODERNISATION NEEDED ELECTRICAL SAFETY NEEDED
NEW STAKES
€7 TRILLION 30 YEARS 1 FIRE EVERY 2 MINUTES
Investments in energy transition by 2030 Life time of a cable caused by an electrical origin in the EU
X4.3 +40 YEARS UP TO 80% OF FIRES
Renewable capacity between 2019 and 2040 Average age of grids in Europe & North America. are triggered by counterfeit cables in emerging area
IMPACTING THE GENERATION
DISTRIBUTION USAGES
ELECTRIFICATION AND TRANSMISSION
018 – Data source: Roland Berger
@2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
NEW CHALLENGES LEADING
TO NEW CLIENT NEEDS
ted
Client needs are changing to face CLIENTS DEMAND
ca
SOLUTIONS
isti
these challenges, and the cable
SY
2000 2010 2020
ph
NOT (ONLY)
ST
So
industry needs to shift from products
EM
COMPONENTS
Early Mid Early Mid Early to sub-systems & services
MA
OP
:
AS
ds
NA
ee
ER
SE
GE
rn
AT
TM
me
ME
IO
CA
AN
sto
NS
NT
BL
Cu
AG
ES
EM
ER
EN
VIC
CA
T
ES
BL
ES
sic
Ba
Automotive Electrical Cable
OEMs Equipment Manufacturers (World value including
accessories and assembly)
OEMs
€220bn €120bn
Telecom
OEMs
Consumer
Electronics
OEMs
019 – Data source: Nexans internal analysis
@2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
REMAINING A GENERALIST
WILL BE A WEAKNESS NOT A STRENGTH
EVOLUTION OF MARKET DEMAND… …CANNOT BE MATCHED BY A GENERALIST
• Differentiated products • Inability to lead innovation on all segments
• Combination of sub-systems, services and software • Product portfolio too large to focus on system development
• Sector specific skills • Larger but shallower skillset
• Long-standing partnerships • Spread customer base
• Investments focused on Innovation and scale • Fragmented investments
020 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
REINVENT OUR MODEL
TO TRANSFORM CUSTOMER EXPERIENCE
SWITCH FOCUS FROM COMPLEXITY
FROM: VOLUME GROWTH FOCUS MANAGEMENT TO CLIENT INTIMACY TO: VALUE SCALE FOCUS
Exhaustive coverage of markets 01. Deep understanding
of clients markets
Global expertise
of one ecosystem
Do-it-all cable range 02. Build up high added
value solutions
Cable + Sub-systems
& services
Invest to scale
Diluted maintenance &
growth investments 03. up and innovate
Focused value
scale investments
021 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
ELECTRIFICATION PURE PLAYER
ENGINEERING A NEW MODEL
By positioning ourselves as an electrification This unique positioning enables us to scale up
pure player, Nexans will combine market focus, offers and specialize assets on an ecosystem that
scale effect and a specialist customer intimacy will represent more than 65% of the total cable
REGIONAL /
with our global client reach, typical of a major
cable generalist.
business in 2030, while providing an end-to-end
management of the electrification challenge.
GLOBAL LOCAL
>3 regions 1 or 2 regions
AMPLIFY SIMPLIFY FOCUS ELECTRIFICATION
Electrification Portfolio Markets Coverage Resources PURE PLAYER
– M&A – Product range – CAPEX
CABLE
– Innovation – Industrial assets – Management
GENERALIST
– Selective organic growth – R&D
SEGMENT
SPECIALIST
022 – Data source: Nexans internal analysis
@2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
ELECTRIFICATION PURE PLAYER
ENGINEERING A NEW MODEL
#01 #02 #03
A HUGE ELECTRICITY A NEED FOR SYSTEMS A NEED FOR
BOOM TO COME AND SOLUTIONS GLOBAL REACH ELECTRIFICATION
PURE PLAYER
REQUIRING SELECTIVITY ENABLED BY AN IN A FRAGMENTED
ECOSYSTEMIC VIEW MARKET OFFER
023 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
WHAT TO
CHANGE?
SIMPLIFY
TO AMPLIFY
024 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
01
SIMPLIFY
OUR BUSINESS
Focus on electrification
02
AMPLIFY
OUR IMPACT
Pursue transformation
and value growth
025 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
WHAT IS THE NEXANS METALLURGY INDUSTRIAL SERVICES & PROJECTS
WE WISH TO SIMPLIFY? 18 Automotive Automation
% Harnesses
Wind turbine Aerospace Pumps, generator
internal cabling & drives
Nexans 2020 split of sales Solar LV O&G Rolling Handling
at constant metal price ME
TA
L LU
RG
Y
cabling downstream Stock
Nuclear plant O&G Shipbuilding Medical
internal cabling Upstream
Other gen. Mining Railway Electrical
internal cabling appliances
ELECTRIFICATION
Generators Resources Transport Industry
NEXANS
Residential Cabling
& SOLUTIONS
Commercial
SALES
ELECTRIFIC
20
Industrial
2020
Y
%
USTR
ATIO
IN D
N
Offshore Infrastructure
Wind Farms TELECOM
Onshore Distribution Mobility CO
M
LE
Renewable Farms Network TE
Other Centralised Interconnections Distributed Data Centres
Generators Generators Power Cables
55
Submarine
7 Telecom
Generation Transmission Distribution Usages %
% Telecom infra.
Fibre
Data Centers
- Data Cables
NEXANS SCALING PLAYGROUND Antennas Offices
Transmission Local Systems
026 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
3 REASONS TO SIMPLIFY OUR BUSINESS
BY FOCUSING ON ELECTRIFICATION
A tremendous organic & inorganic growth potential
#01 #02 #03
IN 2019, ELECTRIFICATION THANKS TO STRONG MEGATRENDS, ELECTRIFICATION AS A SEGMENT IS
REPRESENTED ABOUT 65% CAGR WILL BE ABOVE OTHER STILL FRAGMENTED AND OFFERS A
OF THE WORLD CABLE MARKET SEGMENTS ON THE PERIOD LARGE M&A PLAYING FIELD
Cable Market: €236bn 2019-2030 CAGR (in %) Number of manufacturers Totalling>40% of Market Share:
(in number of manufacturers)
Electrification €154bn €156bn
€99bn 4.3% 3.4% 3.6% >25
Telecom €39bn
€27bn
Industrial €40bn 4 5
(Inc. Harnesses) €28bn
Electrification Telecom Industrial Electrification Telecom Industrial
2019 2030 (Inc. harnesses) (Inc. harnesses)
027 – Data source: Nexans internal analysis
@2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
01
SIMPLIFY
OUR BUSINESS
Focus on electrification
02
AMPLIFY
OUR IMPACT
Pursue transformation
and value growth
028 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
AMPLIFY VALUE
MANAGEMENT FOCUS
GROWTH Pursue our
TRANSFORM OUR
OPERATIONAL MODEL
Pay our performance Debt
transformation
FOCUS ON programs on
Business Unit Portfolio Management 1.0 Business Unit Portfolio Management 2.0
ALL SEGMENTS
ELECTRIFICATION Cost reduction & efficiency initiatives
WHILE PUSHING SHIFT
ONE STEP FURTHER
THE FULL GROUP 2018 2019 2020 2021 2022 2023 2024
TRANSFORMATION
PROGRAM
MANAGEMENT FOCUS
TRANSFORM OUR POSITIONING
Amplify & accelerate Change playing field to grow value
our growth in value on
ELECTRIFICATION
M&A - Divestments
SEGMENTS
SCALE VALUE UP
SHIFT PRIME as an electrification
pure player
Innovation & Ecosystemic Partnerships
029 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
AMPLIFY VALUE
MANAGEMENT FOCUS
GROWTH Pursue our
TRANSFORM OUR
OPERATIONAL MODEL
Pay our performance Debt
transformation
PURSUE OUR programs on
Business Unit Portfolio Management 1.0 Business Unit Portfolio Management 2.0
ALL SEGMENTS
TRANSFORMATION Cost reduction & efficiency initiatives
PROGRAMS ON SHIFT
ALL SEGMENTS
2018 2019 2020 2021 2022 2023 2024
MANAGEMENT FOCUS
TRANSFORM OUR POSITIONING
Amplify & accelerate Change playing field to grow value
our growth in value on
ELECTRIFICATION
M&A - Divestments
SEGMENTS
SCALE VALUE UP
SHIFT PRIME as an electrification
pure player
Innovation & Ecosystemic Partnerships
030 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
NEXANS TRANSFORMATION MODEL 2.0
HUGE VALUE CREATION POTENTIAL ON THE EXISTING PORTFOLIO
BUSINESS PORTFOLIO ANALYSIS
– AN UPDATED PERSPECTIVE #01 BY DRIVING STRONG VALUE CHAIN MOVE
ON OUR INNOVATION DRIVERS
Our portfolio management model keeps the same spirit and principles while improving itself along side 2 axis:
– The matrix axis will display a stronger focus on cash generation trough CCR CUSTOMERS NEXANS
which represent our capability to convert EBITDA in Free Cash Flow
– A new category is introduced: Innovation Drivers – Productivity and cost efficiency improvement – Improved customer loyalty
– Increased thresholds to raise targets – Optimization of project Capex – ROCE and cash conversion improvement
– Reduction of Opex (e.g. smart inventory) (at ISO revenues)
– Guarantee of safe & reliable products – Synergies between services & hardware
Innovation Drivers
#02 BY TRANSFORMING THE REMAINING
UNITS WITHIN THE GROUP
0%
EBITDA %
Strategic Investments Profit Drivers Sales
Transformation Candidates EBITDA
Value Burners
FCF
Cash Conversion Ratio (%)
031 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
NEXANS TRANSFORMATION MODEL 2.0
A SYSTEMIC AND UNIQUE VALUE CREATION PROCESS
Nexans is today segmented into about 30 business units They are brought through a standardized transformation
each with their own financial statements, manufacturing process which covers cost structure, business model WORK IN PROGRESS
units and client portfolios. These units are managed trough engineering and offer engineering to maximize value
COMPLETED
a portfolio approach based on financial KPI’s. creation and reach upper range financial ratios.
EXAMPLE VALUE TRANSFORM. PROFIT INNOVATION
LEVERS BURNER CANDIDATE DRIVER DRIVERS
L23-31 – Innovation, Solutions
SEQUENCE 3 L22 – Brand Prime
SHIFT Prime L21 – Superior service offer
10 Levers
L6 to 20...
L5 – Cash Conversion Pool
SEQUENCE 2 L4 – Portfolio reegineering
SHIFT Performance
20 Levers (250 pages
handbook,15 tools)
L3 – Complexity reduction
Restructuration L2 – Lean Management
SEQUENCE 1
L1 – Fixed costs reduction
032 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
BUSINESS UNIT PORTFOLIO MANAGEMENT 2.0
OUR 2024 AMBITIONS
BUILDING BUSINESS UNITS PORTFOLIO TURNOVER EVOLUTION PER PERFORMANCE CLUSTER
2021E
Innovation Drivers
Building 2024E
EBITDA %
2021E
Strategic Investments Profit Drivers
Utilities 2024E
Transformation Candidates
2021E
High Voltage 2024E
Value Burners & Projects
Cash Conversion Ratio (%)
033 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
AMPLIFY VALUE
MANAGEMENT FOCUS
GROWTH Pursue our
TRANSFORM OUR
OPERATIONAL MODEL
Pay our performance Debt
transformation
AMPLIFY & programs on
Business Unit Portfolio Management 1.0 Business Unit Portfolio Management 2.0
ALL SEGMENTS
ACCELERATE Cost reduction & efficiency initiatives
OUR GROWTH SHIFT
IN VALUE ON
ELECTRIFICATION 2018 2019 2020 2021 2022 2023 2024
SEGMENTS
MANAGEMENT FOCUS
TRANSFORM OUR POSITIONING
Amplify & accelerate Change playing field to grow value
our growth in value on
ELECTRIFICATION
M&A - Divestments
SEGMENTS
SCALE VALUE UP
SHIFT PRIME as an electrification
pure player
Innovation & Ecosystemic Partnerships
034 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
FOCUSING ON
CUSTOMERS & INNOVATION
UP TO 200BPS
Gross Margin
observed on average
after 12 months
INITIAL SUPERIOR
PRIME
PERFORMANCE SERVICE VENDOR PERFORMANCE
BRAND PRIME SALES AMPLIFIERS MIX OPTIMIZATION SMART INNOVATION
Ensure higher availability, Develop Brand intimacy Enrich offers with Add incremental Replace generic offers by
reduce lead-times & through marketing accessories or services features to products to smarter ones
digital supply chain improve value
035 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
M&A AMPLIFY OUR ELECTRIFICATION SCOPE & OFFER
Nexans articulates its M&A strategy alongside two complementary axis: BOLT-ON INNOVATION ACQUISITIONS
– Consolidation deals in the field of electrification
– Bolt-On deals enabling to enrich our value offer in the
field of electrification
TRANSFORMATIVE CONSOLIDATION ACQUISITIONS
GENERATION TRANSMISSION DISTRIBUTION USAGES
Nexans is currently screening bolt on acquisition opportunities to enhance
its offer alongside the electrification value chain alongside 3 axes:
8 NORTH
AMERICA
32 EUROPE
39 ASIA #01 #02 #03
DATA COLLECTION,
DESIGN & ENGINEERING SMART
14 SOUTH
AMERICA 37 AFRICA &
MIDDLE EAST
SERVICES MANAGEMENT &
EXPLOITATION PRODUCTS
130 Amplify the impact of SHIFT PRIME and Nexans
OPPORTUNITIES HAVE
BEEN ALREADY IDENTIFIED
& 20 SHORTLISTED innovation program through our bolt on
acquisition portfolio
036 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
INNOVATE
TO ELECTRIFY GENERATION TRANSMISSION DISTRIBUTION USAGES
100% DEDICATED ANSWERING MANAGING
TO ELECTRIFICATION CUSTOMER NEEDS RISKS
Increase green generation
CUSTOMER EXPERIENCE reliability, monitoring
+€100m +1800
R&D Expenses Patents
– Supply chain
– Smart products
– Services
– Risk management
interconnections & OWF
connection to the shore
DIGITALISATION
Increase grid resilience to
– Industry 4.0 – Artificial intelligence blackout risk through asset live
+800 >50 – Connected products
(IoT)
– Digital twin monitoring & management
Technical Experts Innovation per year SUSTAINABILITY
Increase building safety
– Recycling – Circular economy trough live monitoring of the
– Carbon neutrality electrical system
037 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
SUPERCONDUCTING SYSTEMS - A BREAKTHROUGH FOR RELIABLE AND RESILIENT URBAN GRIDS
GENERATION TRANSMISSION DISTRIBUTION USAGES
NEXANS
SFCL
CROSS-BORDER
INTERCONNECTION
GRID
AUTOMATION
SUPERCONDUCTIVE
SMART SWITCH & HV LINK
DISTRIBUTION AUTOMATION
038 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
SUPERCONDUCTING SYSTEMS - A BREAKTHROUGH FOR RELIABLE AND RESILIENT URBAN GRIDS
GENERATION TRANSMISSION DISTRIBUTION USAGES
SUPERCONDUCTIVE
HV LINK
1-3 GW
at the heart of the town
90%
less civil work
ZERO
thermal and
electromagnetic
signature SUPERCONDUCTIVE
HV LINK
039 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
SUPERCONDUCTING SYSTEMS - A BREAKTHROUGH FOR RELIABLE AND RESILIENT URBAN GRIDS
GENERATION TRANSMISSION DISTRIBUTION USAGES
NEXANS
SUPERCONDUCTIVE FAULT CURRENT LIMITERS (SFCL)
- Divide fault probability by a factor 4
- Allow distributed generation integration
- Keep existing Network
NEXANS
SFCL
040 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
A DIGITAL TWIN IS A UNIQUE VIRTUAL MODEL OF A REAL GRID
GENERATION TRANSMISSION DISTRIBUTION USAGES
ASSET ELECTRICAL
SOFTWARE SOLUTION
- Provides visualization, analysis, prediction and optimization
- >20% efficiency in operation & optimized investments
- Targeted maintenance
REAL DIGITAL TWIN:
WORLD REAL TIME REPLICA - Reduced energy loss
50% 58% 53% +45 YEARS
value of lines (cables, support, network faults due to of the surface burned in is the average grid age in EU
connectors) in grid assets lines/cable network California was due to fires of
electrical power origin in 2017
041 – Data source: Roland Berger
@2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
NEXANS STRATEGY FOR IoT DEVELOPMENT
ENABLING AN HOLISTIC APPROACH OF THE GRID RISKS & CHALLENGES
#01 TRACKING
ASSETS
Track location, characteristics and status of
#02 MONITORING
ASSETS
Monitor the electrical assets during their lifetime
#03 MANAGE
ASSETS
Optimize the use of grid functioning, from
valuable grid components. to predict failures, ease maintenance increasing generation to usage. Make live decisions on
– Shorten operations time safety & reliability. energy routing.
– Stock management – Reduce risks of grid failure – Increases grid resilience
– Anti Theft – Prevent fire risk in buildings – Maximize use of generated electricity
– Cost avoidance – Maintenance costs control – Balance energy offer & demand
– Electrical loss reductions
– CAPEX avoidance
Covered Assets: Covered Assets: Covered assets:
– Cable drums – Cables – Grid sensing Smart grids
– Accessories – Network components – HV & MV infrastructures
25% NEXANS CONNECTED PRODUCTS BY 2024 (IoT)
042 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
INNOVATE TO ELECTRIFY USTRY 4.0 RECY
CLIN
AMPLIFY – OUR IMPACT
IND G S
U
IN
ST
W
THANKS TO OUR PARTNERS L T
L
AI
I TA
TA
CA
GI
RB
NA
DI
DIG
ON
BIL
NE
Y
UTR
VIT
IT Y
ECTI
AL
IoT CONN
CIRCULAR ECO
D/A.I.
N
U
O
O
MY
CL
T
EN
EM
ES G
D
IG A
N AN
K M
RIS
SUPPLY
CU C E
STO I E N
MER EX PER
043 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
NEXANS INNOVATION PIPELINE
FULLY DEDICATED TO AMPLIFY THE ELECTRIFICATION
RESIDENT ENGINEER BUSINESS CONTINUITY MANAGEMENT ELECTRICAL ASSET MANAGEMENT SMART INVENTORY MANAGEMENT
RISK MANAGEMENT VIRTUAL TRAINING GRID MONITORING EV CHARGING SOLUTIONS
SERVICES
INSTALLATION INFRABIRD DIGITAL SUPPLY CHAIN
HEDGING IoT CABLE
RECYCLING
GENERATION TRANSMISSION DISTRIBUTION USAGES
POWERBOOST ® INFIT ®
TECHNOLOGIES
KELIOS HARNESS ALSECURE ®
HVAC SUPERCONDUCTIVITY CONNECTED EV CHARGING SYSTEM
FLEXIBLE CABLES HVDC 525KV SMART ACCESSORIES MARKING TECHNOLOGIES
(DISTING, LIFMARK, METRIUM)
044 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
HOW TO
CHANGE?
TRANSFORM
AND INNOVATE
045 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
01 GENERATION
& TRANSMISSION
02 DISTRIBUTION
03 USAGES
046 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
WHAT IS Distributed generation Distributed generation
GENERATION
(Utility scale) (Private)
AND TRANSMISSION?
Offshore wind
Residential
Onshore wind
Datacentres
Solar Infrastructures
Hydro Industrial
Centralised Transmission Distribution Usages
generation subsea and land Commercial
Nuclear
Mobility
Fossil
GENERATION AND TRANSMISSION DISTRIBUTION USAGES
047 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
OFFSHORE WIND FARMS ENABLE THE GREEN TRANSITION
2.5X CABLE MARKET GROWTH NEXT DECADE
CABLE MARKET FORECAST MAIN DRIVERS
€8bn* COMPETITIVE COST
OF ENERGY VS OTHER
CAGR
RENEWABLE SOURCES €250-400m +200GW
+11.5% of cable value per GW installed to be installed by 2030
€3bn* PEOPLE
ACCEPTANCE
2019 2030e
*per year
OFFSHORE VALUE CHAIN OF OFFSHORE WIND FARM
WIND FARMS
ESSENTIAL COMPONENT OFFSHORE PLATFORM EXPORT CABLE
CENTRALISED LAND SECTION
GENERATION
Cables are becoming more powerful,
dynamic and covering longer distances
83% SUBSTATION HIGH VOLTAGE
GRID
of the cost of Offshore Wind Farm INTER-ARRAY CABLE EXPORT CABLE SUBSEA SECTION
(33 OR 66 kV) (3220 kV HVAC OR HVDC)
construction claims are cables generated
048 – Data source: Roland Berger
@2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
BUILDING THE ENERGY HIGHWAY
BRINGING ENERGY FROM THE GENERATION AREA TO THE CONSUMPTION AREA
TRANSMISSION MAIN DRIVERS
>€25bn
INCREASING SHARE
OF RENEWABLES BUT
GEOGRAPHICAL MISMATCH MORE POWER,
+72.000 km >60+
LONGER DISTANCES, High voltage power to be invested in cable links in the large projects in
GREATER DEPTHS cables to be installed US over the 2021–2030 period. EU and APAC
MASSIVE INVESTMENTS between 2020 - 2030 Nexans estimate of HVDC Land
IN NEW CABLE LINKS TO cable to renew US grid by 2030
SECURE ELECTRICITY SUPPLY
INTERCONNECTIONS
VALUE CHAIN OF SUBSEA INTERCONNECTION
TRANSMISSION
CABLE MARKET FORECAST
€5bn
CAGR
+14.3%
HIGH VOLTAGE SUBSTATION SUBSTATION HIGH VOLTAGE
€1bn GRID GRID
INTERCONNECTOR
2019 2030e
049 – Data source: Roland Berger
@2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
NEXANS HAS INVESTED > €500m IN THE ENERGY TRANSITION
AT A TARGETED IRR > 20%
PHASE 1
CHARLESTON PLANT NEXANS AURORA
2018-2021
THE 1ST SUBSEA HV MANUFACTURING STATE-OF-THE ART CABLE
€360M
FACILITY IN THE US LAYING VESSEL
R&D FEED* ENGINEERING MANUFACTURING INSTALLATION AFTER MARKET
PHASE 2 UPGRADE CHARLESTON FACILITY EXPANSION OF THE HALDEN PLANT
TO INCREASE SUBSEA & LAND ADDING 2 NEW LINES FOR HVDC
2021-2024 HVDC MANUFACTURING CAPACITY CABLE MANUFACTURING
€200M For Offshore Wind Farm and Land
HVDC US corridors
F or Offshore Wind Farms
and Interconnections
050 *Front-End Engineering and Design @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
FOCUS OUR RESOURCES IN THE BEST PORTFOLIO
MODELIZE TO PRICE RISK AT ITS FAIR VALUE
#01 PROJECT RISK #02 ASSETS YIELD
Nexans has reshuffled the backlog, lowering risk
– Technology risk – Vessels & Installation tools while yielding capacity and improving returns.
– Statistics of past projects – Cable manufacturing plants SHIFT Project modeling enables us to go one step
– Terms & conditions further in asset modeling and risk management.
NEXANS BACKLOG PROFILE (ILLUSTRATION)
#03 Non attractive
risk/return area
Target risk/return
area
TENDER
BACKLOG OUTSIDE TARGETED
SELECTIVITY RISK/RETURN AREA
RETURN
BACKLOG WITH TARGETED
RISK/RETURN AREA
RISK
2018 2019 2020 2021 2022 2023 2024
051 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
BUILDING RELIABLE GREEN ENERGY GENERATION & TRANSMISSION
COMBINING ANALYTICS WITH A SOUND RISK MANAGEMENT TRACK RECORD
Nexans end-to-end approach of risk management for Subsea
and Land EPCI projects combine robust processes, advanced
modelization tools and an historic database for the best results.
DESIGN AND ENGINEERING MANUFACTURING INSTALLATION
A PARTNERSHIP TO BRING PROJECT & RISK
MANAGEMENT A STEP FURTHER
83%
of claims linked to Certifies the Nexans way of managing EPCI projects & risks
cables from 2012–2017 Develops new standards for the OWF and Interconnection industry
for Offshore Wind
Reduces risk profile of such projects
Farm projects
Reduces Nexans time to market
052 – Data source: Roland Berger
@2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
MANAGE CRITICAL GENERATION & TRANSMISSION ASSETS
SECURE ENERGY SUPPLY
€9.3bn 1 YEAR
Expected cost of 2020-2030 interconnection Worst case repair duration due to
cable outage, which is 2x to 5x more than complex engineering asset availability,
during the previous decade legal processes and expert availabilities
NEXANS BUSINESS CONTINUITY SOLUTIONS
Reduce downtime losses
Electricity transfer
downtime reduced by
70%
with a Nexans
Service subscription
SURVEILLANCE ASSET MANAGEMENT ANTICIPATION EMERGENCY REPAIR
053 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
PUSHING TECHNICAL FRONTIERS
BROADENING THE SCOPE OF POSSIBILITIES FOR OUR CLIENTS
2020 2024
CUTTING EDGE TECHNOLOGY AMPLIFY TECHNOLOGY LEADERSHIP
HVDC Extruded:
525kV Subsea and Land cable system • Increase voltage levels beyond 525kV for our subsea and
Long Distances: OFFSHORE land cables systems
World’s longest HVDC interconnector 525 kV – 623 km WIND FARMS • Deep water applications down to 3,000m
Deep Water Applications:
• Advanced cable systems for floating Offshore Wind Farms
• World’s deepest 420 kV XLPE cable – 550 m water depth
• Nexans’ deepest HVDC interconnector installed at 1,500 m water depth • Next generation cable installation and protection
• Hybrid cable at 2,300m
• Amplify technological leadership through HVDC
Dynamic Applications:
Powerboost™, Nexans proprietary solution for thermoplastics
Dynamic HV cables to world’s first floating offshore wind farm
INTERCONNECTORS
054 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
01 GENERATION
& TRANSMISSION
02 DISTRIBUTION
03 USAGES
055 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
WHAT IS Distributed generation
(Utility scale)
Distributed generation
(Private)
DISTRIBUTION?
Offshore wind
Residential
Onshore wind
Datacentres
Solar Infrastructures
Hydro Industrial
Centralised Transmission Distribution Usages
generation subsea and land Commercial
Nuclear
Mobility
Fossil
GENERATION AND TRANSMISSION DISTRIBUTION USAGES
056 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
A GROWING ENERGY DEMAND
BUT THROUGH AN AGEING GRID ASSET
GROWTH DRIVERS INVESTMENT
+1.8 BILLION +17% X2.6 €4.4tn
inhabitants to have access additional electrical energy renewable electricity to be invested from 2020 to 2030
to electricity by 2030 to be produced in 2030 capacity by 2030 for electrification, renewables
compared to 2019 & network replacement
BUT THE WORLD IS FACING AN AGEING ELECTRICAL GRID ASSETS... CABLE MARKET FORECAST
Estimates of average grid age per region and expected lifetime in years
DISTRIBUTION 45-50
DISTRIBUTION & UTILITY
SCALE DISTRIBUTED 35-40 €62bn
GENERATION
Average cable life time 30 years
25-30 25-30 25-30 CAGR
20-25 20-25
€40bn +4.2%
NORTH AMERICA
LATIN AMERICA
15-20
REST OF APAC
MIDDLE EAST
SOUTH-EAST
EUROPE
AFRICA
CHINA
ASIA
2019 2030e
057 – Data source: Roland Berger
@2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
STRENGTHEN THE DISTRIBUTION NETWORK
SECURE GRID SOLUTIONS TO FACE THE GROWTH AND REPLACEMENT
AS
SE
FROM: TO:
TM
AN
PRODUCT OFFERING SOLUTIONS OFFER
AR
AG
SM
CH
EM
AR
ITE
TS
IN
EN
CT
ST
YS
TS
UR
AL
TE
ED
OL
LA
MS
UT
ES
TIO
IO
IG
CABLES &
N
NS
N
CABLES ACCESSORIES
Turnkey Superconductors solutions Asset Management,
and preventive
maintenance for
Smart cables the aging grid with
& accessories
80
ENGINEERS 100% Turnkey solutions to connect utility scale renewable farms
DEDICATED TO
SUPPORT THESE
SOLUTIONS
Turnkey solutions for electrification - NEOGRID®
058 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
TURNKEY SOLUTIONS IMPROVE TOTAL COST OF OWNERSHIP TROUGH GRID ENGINEERING
TO CONNECT UTILITY SCALE Nexans brings end-to-end solutions to connect utility scale renewable farms connection to the grid.
We combine a unique architecture design know how with, installation, civil work, cables, active & passive accessories.
RENEWABLE FARMS
AN END-TO-END SOLUTION
ARCHITECTURE DESIGN CABLES ACCESSORIES INSTALLATION
ARCHITECTURE DESIGN: A UNIQUE KNOW HOW TO OPTIMIZE THE COLLECTOR DESIGN
STOCKYARD HILL WIND FARM
CABLE SIZING LAY-OUT OPTIMIZATION ARCHITECTURE
149 turbines, 540MWp, 1350GWh, Australia
– Reduce losses to optimize power output
-7%
CAPEX
-9.1%
20 years TCO vs.
–
–
–
Reduce total CAPEX
Support arbitration on the OPEX vs. CAPEX balance
Reduce risk of electrical failure trough more resilient designs
Standard Blueprint
059 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
NEOGRID®
TURNKEY SOLUTIONS Nexans NEOGRID® offer is dedicated to emerging area searching solutions
to electrify safely, rapidly and at the best cost a specific region
FOR ELECTRIFICATION
NEOGRID® TURNKEY SOLUTION
ARCHITECTURE
FINANCING CABLES ACCESSORIES INSTALLATION
DESIGN
A FOCUS ON HARDWARE SOLUTION:
ACTIVE & PASSIVE COMPONENTS
PIONEER PROJECT
ELECTRIFICATION PROJECT IN IVORY COAST, FULL TURNKEY
€10m 51
Project villages
35
completed
Polls Transformers Substation Cables -EDR Max –
low civil work
Connections
& protections
to electrify
060 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
01 GENERATION
& TRANSMISSION
02 DISTRIBUTION
03 USAGES
061 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
WHAT IS Distributed generation
(Utility scale)
Distributed generation
(Private)
USAGES?
Offshore wind
Residential
Onshore wind
Datacentres
Solar Infrastructures
Hydro Industrial
Centralised Transmission Distribution Usages
generation subsea and land Commercial
Nuclear
Mobility
Fossil
GENERATION AND TRANSMISSION DISTRIBUTION USAGES
062 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
BUILDING CABLE MARKET
BRING SAFE ELECTRICAL POWER AT THE HEART OF OUR LIFE PLACES CABLE MARKET FORECAST
€81bn
>30 MILLION 43 CAGR
of EVCS will be installed by between megacities in 2030 €55bn +3.8%
2019 and 2030 (residential, commercial - Urbanization
and workplace) in Europe
Predicted Sales
2019 2030e
ELECTRICAL SAFETY
+6 GWP MAIN +1.8 BILLION
of BIPV capacity to be
USAGES installed between 2018 and DRIVERS inhabitants to have access
to electricity by 2030
2022 worldwide
BUILDINGS,
INFRASTRUCTURES,
MOBILITY, DATACENTERS
NEW REGULATIONS AND 1 FIRE EVERY
OPTIMIZATION (BIM) 2 MINUTES UP TO 80%
BUILDING caused by an electrical
of fire outbreaks due
to counterfeit cables
RETROFIT origin in the EU in emerging countries
063 – Data source: Roland Berger
@2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
BUSINESS UNIT PORTFOLIO MANAGEMENT 2.0
SCALE UP SUCCESSFUL UNITS DNA SEQUENCE
BUSINESS UNIT 1
BUILDING BUSINESS UNITS PORTFOLIO
SHIFT PERFORMANCE & SHIFT PRIME DEPLOYED:
Branded product innovation program focused on
Strategic Investments Profit Drivers Innovation Drivers
ease to use & packaging
BU2
BU1
BU4 BU3
€70m ~16% ~50%
SALES EBITDA ROCE
BU6 BU5
BU7
BU8
EBITDA %
BU10 BU9 BUSINESS UNIT 2
BU11
BU12 BU13 SHIFT PERFORMANCE & SHIFT PRIME DEPLOYED:
Branded differentiation based on product safety
Transformation Candidates BU14 and full electrification kit delivery
BU17 BU16 BU15
Value Burners
>€50m ~21% ~35%
SALES EBITDA ROCE
Cash Conversion Ratio (%)
064 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
STRENGTHEN THE DISTRIBUTION NETWORK
RESILIENCE AND EFFICIENCY TROUGH SMART SOLUTIONS
FROM: TO:
EN
DI
D-
PRODUCT OFFERING SOLUTIONS OFFER
GI
AC
TO
TA
-EN
CE
L
SS
FA
EA
D
OR
CT
OP
SY
OR
IES
ER
TO
Y
/T
AT
HA
OO
IO
ND
PVC
NS
FIRE SAFETY
LS
CABLES
LE
CABLES
Product Innovations to ease installation & EASYCALC
25%
NEXANS
80
DEDICATED
6
REGIONAL
3
SPECIALTY
Fire Resistant transport, enhance safety and increase
installer productivity
End-to-end
supply chain
Cable
Dimensioning
App
CONNECTED PEOPLE DESIGN LABS DESIGN LABS
PRODUCTS BY MOBIWAY®
2024
50% of interviewed client
HFFR would be ready to change AGICITY®
distribution branch to have it
ONE UNIQUE – IoT/Connected products
– End-to-end Supply Chain
PLATFORM – Digital Customer Apps, Web
065 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
AGICITY®
ELECTRIC VEHICLES CHARGING From power distribution to asset management, Nexans offers a complete solution
for AC and DC Electrical Vehicles Charging Stations (EVCS)
STATIONS SOLUTIONS
AN END-TO-END SOLUTION
POWER CONNECTION EVCS INSTALLATION ASSET MANAGEMENT
EVCS: ELECTRICAL VEHICLE CHARGING STATION
AGICITY AP
7 TO 22KVA-AC
SERVICES BY AGICITY
A hotline, a real-time supervision software, experts, to
AGICITY FAST
guarantee faultless operation of the installations.
24 KVA DC
Nexans offers preventative and on-going maintenance
services based on real-time supervision tools (SIGP).
066 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
NEXANS UNIQUE VALUE PROPOSITION END-TO-END SUPPLY CHAIN
FROM... ...TO
MAKE TO ORDER MAKE TO AVAILABILITY
STATIC INVENTORY DIGITAL END-TO-END MONITORING (IoT)
ROCE 2
SUPPLY CHAIN DISRUPTION VERTICAL INTEGRATION: COPPER/ALU/RECYCLING
COST FOCUS ONLY ROCE2 : RETURN ON CAPITAL EMPLOYED
VS RETURN ON CARBON EMPLOYED
NEXANS SUPPLY CHAIN 4.0: AMPLIFY OUR IMPACT
SECURE COPPER CABLES CABLES DISTRIBUTORS DISTRIBUTORS
END USERS RECYCLING
SCARCITY PRODUCTION INVENTORY WAREHOUSES AGENCIES
END-TO-END SUPPLY CHAIN TO OPTIMIZE ROCE2
067 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
NEXANS OWNS
CABLE FIRE +150 PATENTS THAT
TECHNOLOGIES ARE FIRE SAFETY
RELATED
FOR A SAFER
ELECTRIFICATION 1 FIRE EVERY 1,000 GROWING POWER IN
2 MINUTES 25% TO 30% FATALITIES RESIDENTIAL BUILDING
caused by an electrical of domestic fires caused by in the EU each year 24M EVCS to be installed in
origin in the EU an electrical origin in the EU residential building by 2030
PVC / PE STANDARD CABLES FIRE RESISTANT & RETARDANT CABLES
FIRE IGNITION Catch fire easily in case of short circuit Heat but does not burn
The Construction Products
Regulation (CPR) in Europe,
FIRE PROPAGATION Transmit fire between rooms across cable pipes HFFR Does not transmit fire is setting fire requirements
for cables which can prevent
or accelerate fire depending
TOXIC FUMES Fire smoke opacity blocks visibility at 5m 50m visibility through HFFR cables smoke on the chosen technology
SAFETY SYSTEMS Melt and stop powering safety systems such as HFFR withstand 1000 °C more than 2 hours
RELIABILITY lighting or ventilation still transmitting electric current
068 – Data source: Roland Berger
@2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
INDUSTRY 4.0
MANUFACTURING COMPETITIVENESS
PERFORMANCE MONITORING PREDICTIVE MAINTENANCE
Process Efficiency & Data Visibility Analytics to increase Overall Equipment
Effectiveness (OEE)
ENERGY MONITORING CONTROL TOWER
Carbone Emission Reduction Quality Reliability and Stability
AUGMENTED OPERATOR LEAN DIGITALISATION SYSTEM
In Hands Information (Real Time Data and Analytics Kanban, Work Instructions, Work Orders
Model Combination)
On-line Training Support INTEGRATION OF DIGITAL SOLUTION IN INDUSTRIAL
PROCESS AND DATA DRIVEN FACTORY
069 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
SCALE-UP
TO STEP-UP
PERFORMANCE
NEW
FINANCIAL
TRAJECTORY
2021–2024
070 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
01 02
INTRODUCTION AMPLIFY
ELECTRIFICATION
Organic Growth
03 04
STEP-UP SCALE-UP TO STEP-UP
ELECTRIFICATION PERFORMANCE
M&A Group Financial Trajectory
2021 - 2024
071 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
EBITDA (€m)
ROCE (%) FREE CASH FLOW (€m)
WHERE DO WE % sales at standard metal prices
COME FROM? 5.3% 6.4% 6.1% 6.5-8%
STEERED FOR GROWTH
410-450 12.5%-14.5% 157
100-150
413
Since 2019 Nexans has restored its profitability,
reinforced its balance sheet and shifted the
financial mindset to cash generation 347 11.1%
325
10.2%
The company has delivered:
9.0%
#01 #02 #03
Cost SHIFT Portfolio
reductions program management
covering & selective 54
fixed costs growth
and industrial
performance
25
2018 2019 2020 2021 2018 2019 2020 2021 2018 2019 2020 2021
Notes:
– 2018 pre IFRS16 implementation
– Scenarios considered in the current CMD presentation will be further analyzed prior to deciding their implementation and projects resulting from those
– Starting January 1st 2020, change in copper standard price from 1,500 €/ton to 5,000€/ton. 2018 and 2019 EBITDA% calculated based on restated sales at standard metal price studies will be submitted to relevant legal bodies including to employee representatives bodies if applicable and when needed.
– ROCE calculated as 12 months Operating Margin on end of period / Closing Capital Employed, excluding antitrust provision
– FCF before M&A and equity flows
072 – 2021 as per current perimeter, i.e excluding M&A and/or divestments @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
OUR COMMITMENTS
AMPLIFY AND SCALE-UP WITH DISCIPLINE
SUSTAINABLE & SOUND
ROTATE TO ELECTRIFICATION SCALE-UP IN VALUE BALANCE SHEET
SALES AT STANDARD METAL PRICES:
EXISTING ELECTRIFICATION OVERALL GROUP
(Organic, including (Including M&A, Divestments)
strategic CAPEX)
€6 - 7bn
2021 2024 2021 2024
€0.5bn
€6bn REVENUES
Sales standard
metal price €3 - 3.2bn €3.5 - 3.7bn ~€6bn €6 - 7bn
OWC %
(3) ≤ 6%
€1bn
≤ 2.5%
Metallurgy
CAPEX %
Telecom (4)
INORGANIC EBITDA
% Sales 8 -10% 11 -13% 6.5 - 8% 10 -12%
(M&A)
≤ 2.5x
Industry
& solutions Leverage
Ratio
NCCR (5)
(1) ≥ 30% ≥ 40% ≥ 20% ≥ 40%
€3.5 - 3.7bn
€3 - 3.2bn
ROCE
ORGANIC (2) ≥ 15% ≥ 20% 12.5 -14.5% N/A
(including
Electrification strategic CAPEX)
– Notes: – (3) OWC% as Closing / (Previous Quarter Actual Sales x 4)
– (1) NCCR (Normalized Cash Conversion Ratio) defined as Normalized Free Cash Flow / EBITDA – NFCF excludes strategic capex, PP&E divestment, – (4) CAPEX% as Recurring CAPEX / 12 months Standard Sales
2021 2024 one off-change in working capital and material restructuring plans cash out. Segment NCCR computed after allocation of Group mutualized costs
– (5) Leverage Ratio: Average of last two published net debt on
– (2) Excluding potential goodwill and PPA assets arising from M&A / Assuming Nexans cumulated depreciation ratios for acquired fixed assets Last Twelve Months EBITDA
073 – Scenarios considered in the current CMD presentation will be further analyzed prior to deciding their implementation and projects resulting from those
studies will be submitted to relevant legal bodies including to employee representatives bodies if applicable and when needed. @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
01 02
INTRODUCTION AMPLIFY
ELECTRIFICATION
Organic Growth
03 04
STEP-UP SCALE-UP TO STEP-UP
ELECTRIFICATION PERFORMANCE
M&A Group Financial Trajectory
2021 - 2024
074 @2021 Nexans CMD presentation01 02 03 04 05
INTRODUCTION WHY CHANGE? WHAT TO CHANGE? HOW TO CHANGE? NEW FINANCIAL TRAJECTORY
ELECTRIFICATION DRIVING NEXANS PROFITABILITY IN 2020
A HIGHLY ACCRETIVE SEGMENT... ...DISPLAYING IN SUPERIOR RATIOS
VS. OTHER CABLES SEGMENTS
2% 3%
Metallurgy
18%
21%
Other Cable
32% ROCE
≥200 BPS NCCR %
(2)
≥500 BPS
Segments
27% 55%
OWC %
≤500 BPS EBITDA %
≥50 BPS
Electrification 77%
(HV + B&T) 66%
55% In light of the 2020 financial performance, Electrification displays
45%
the most appealing metrics.
Nexans has been paving the way for Electrification over the past
3 years with most of CAPEX allocated to this Segment.
As of 2020 financial data SALES (1) EBITDA OWC CAPEX
(last 3 years)
– (1) At standard metal prices
075
– Scenarios considered in the current CMD presentation will be further analyzed prior to deciding their
– (2) NCCR (Normalized Cash Conversion Ratio) defined as Normalized Free Cash Flow / EBITDA – NFCF excludes strategic CAPEX, PP&E divestment, implementation and projects resulting from those studies will be submitted to relevant legal bodies including to @2021 Nexans CMD presentation
one-off change in working capital and material restructuring plans cash out. Segment NCCR computed after allocation of Group mutualized costs employee representatives bodies if applicable and when needed.You can also read
