(BFM Stock Exchange) – The cable manufacturer has released a gross operating result adjusted record for 2024, carried in particular by its electrification activities which have recorded significant organic growth. The group’s management has been confident on a risk contract and has also made crucial details on its 2025 objectives.

In the space of six years, Nexans has completely changed his face. The cable manufacturer has given its least efficient activities to square and refocused on its segments related to electrification, that is to say cables for production, use and transmission of electricity .

This transformation has notably passed through acquisitions (Centelsa in Colombia, Reka cables in Finland, the Triveneta Cavi in ​​Italy) and transfers (in particular its American subsidiary specializing in cables in extreme conditions).

The scholarship course followed the implementation of this strategy. While it had fallen at 24.6 euros in September 2018, the Nexans action is now evolving around 104 euros. Admittedly, the election of American president Donald Trump has somewhat abused the group’s stock market in recent months, because of his hostility towards renewable energies, in particular offshore wind.

But Nexans continues to trace his way. The Cabblier published this annual results this Wednesday, February 19 for 2024. “One word to qualify the results: Record”, title ODDO BHF in its note devoted to this publication, this Wednesday.

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The electrical transmission has been dynamic

Over the whole of 2024, the company has generated income of 7.1 billion euros (and 8.5 billion euros by integrating the variations in copper and aluminum prices since 2020), in Growth of 8.7% in published data and 5.1% in organic data, that is to say excluding exchange effects and perimeter. On the fourth quarter alone, organic growth reached 8.3%.

Its gross operating result (EBITDA) adjusted has reached a record both in value and in margin rate. This account line was established at 804 million euros in 2024, up 21% over one year. The corresponding margin is 11.4% against 10.2% in 2023.

Nexans notably benefited from the performance of its electrification activities, which represent approximately 65% ​​of its income. These activities displayed organic growth of 13% with a margin of Ebitda of 12.9%.

This increase in income was brought by the dynamism of the “Power-Transmission” segment, that is to say the cables linked to the electricity generation. This segment recorded organic growth of 50% in 2024, thanks to the increase, last year, of the production capacities of the Halden site (Norway), specialized in submarine cables. The EBITDA of this segment also increased by 72% to 142 million euros.

Nexans also gave net profit of 283 million euros against 223 million euros for 2023. The standard free cash flow reached 454 million euros, stable over one year.

Nexans beat expectations to almost all floors. According to a consensus put online by the company, analysts were tabling on income of 7 billion euros, an adjusted Ebitda of 772 million euros, a profit of 305 million euros and an available cash flow normalized of 330 million euros.

An important risky contract in the Mediterranean

For 2025, Nexans indicated to anticipate an adjusted Ebitda between 770 million euros and 850 million euros (against a consensus located at 804 million euros) and a free cash flow between 225 million and 325 million euros.

Several details must be made to fully understand these objectives. The financial director, Jean-Christophe Juillard, said that the adjusted Ebitda range included perimeter effects with a negative impact of around 30 million euros. In other words, by integrating this effect, the bottom of the range (770 million euros) corresponds to a stable adjusted ebitda compared to 2024.

“The range of the 2024 objective seems wide”, also points to an analyst. Jean-Christophe Juillard recognized that this interval was more important than usual. The financial director explained that this range also took into account the risks linked to the “Great Sea Interconnector” contract (GSI). This contract of 1.4 billion euros won in 2023 by Nexans relates to the supply of submarine cables for an electrical interconnection between Greece and Cyprus.

But political and geopolitical risks have cast doubt on the execution of this contract. The bottom of the range thus corresponds to an outright stop of the project, even if the company wants to be “rather optimistic” on the project, said the financial director. Jean-Christophe Juillard added that the company was waiting for “in the coming weeks”, the final notice to execute the contract.

The managing director, Christopher Guérin has abounded, declaring that he was more “confident” on this project for a few days, because marine analyzes on this project have restarted in Greece. In addition, society has the support of national governments and the European Commission. “I would say that today I see a lot of green fires,” he said.

Useful details on 2025 objectives

In addition, Jean-Christophe Juillard had to clarify an important point on the Treasury flow target available from analysts.

Nexans’ objective for 2025 is not immediately comparable to cash flow of 2024 or the 2025 consensus (317 million euros). Both the cash flow 2024 and the 2025 consensus relate to the so-called “normalized” cash flow while Nexans communicated an objective a free cash flow (very short) for 2025.

The difference is that the free cash flow includes more investments than the “standardized” cash flow. However in 2025 Nexans will carry out a series of strategic investments for its growth, in particular by finalizing the construction of a third cable ship, after the “Skagerrak” and “L’Aurora”, explained Jean-Christophe Juillard. The company has yet to spend around 100 million euros in investments linked to the construction of this ship in 2025.

These details seem to have had a certain impact. The Nexans action increased by more than 8% before completely erasing its earnings a few minutes later. The title then rediculated shortly after 9:30 am, just after the financial director brought the elements of understanding on the forecasts for cash flow and Ebitda range adjusted for 2025.

At the end of this publication, Oddo BHF confirmed his opinion to “outperformance” on action. The broker notes that Nexans exchange with a discount of 45% compared to his eternal Italian competitor Prysmian, based on the operating result expected in 2025, against a historic discount of 26%.