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2018 Third Quarter Financial InformationNov 9, 2018
- Third quarter 2018 +1.9% organic sales growth (+6.1% excluding High Voltage & Projects segment), with a -0.5% organic decrease for the first nine months of the year;
- High Voltage & Projects segment down -16.0%, due to (i) postponements of contracts and awards of contracts in the first half of the year and (ii) a difficult third quarter for the land high voltage business (23.1% on an organic basis). Orders for the submarine high voltage business buoyant since July, should enable the order book to top one billion euros by year-end;
- Strong organic growth in sales of cables for the building market (+11.5%). Growth below expectations for industrial cables despite a favorable trend (+6.5%). Stable sales for Telecom & Data cables (-0.1%) and medium voltage cables (-0.2%);
- Persistently high commodity prices;
- In view of the context, operating margin is expected to come in around 185 million euros for full-year 2018, corresponding to an EBITDA of around 325 million euros.
Paris La Défense, November 9, 2018 – Nexans announces sales of 1,613 million euros for the third quarter of 2018, compared to 1,544 million euros in 2017. At constant metal prices, third quarter sales totaled 1,108 million euros, representing year-on-year organic growth of +1.9%. Excluding the High Voltage & Projects segment (-16.0%), the organic growth figure for cable sales was +6.1%.
For the first nine months of 2018, sales came to 4,895 million euros at current metal prices and 3,309 million euros at constant metal prices, corresponding to a -0.5% organic decrease.
Third quarter organic growth (+1.9%) followed the same pattern as first half of 2018, with another significant increase in sales of cables for the building market, while sales of distribution cables remaining roughly stable. The Group’s other segments performed as follows:
- Organic sales in the High Voltage & Projects segment continued to contract at the same rate as in first half 2018. The Group suffers from the adverse effect of postponements of projects originally scheduled for the second quarter, as well as a lower workload in the land high voltage business. The intense tendering activity, particularly in the submarine high voltage business, with robust order intakes over recent months confirm that the order book will exceed one billion euros by year-end.
- The positive momentum for specialty cables continued, with an improvement in quarter-on-quarter organic growth (from +0.6% in the first quarter of 2018 to +6.5% in the third quarter). Automotive harnesses and other industrial cables were both lifted by the trend. In the Telecom & Data segment, higher demand for optical fiber cables combined with the gradual recovery in sales of LAN cables and systems in the United States led to stable sales compared with the third quarter of 2017.
“ This third quarter, with its sharp growth in sales of cables not reflected in our margin, is demonstrative of the Group’s current challenges.
For this reason, we also announce today a transformation roadmap to change Nexans value delivery model.
This plan will focus the Group on selective growth rather than absolute growth, as well as on increasing return on capital employed and cash generation.
Nexans now has a precise, targeted roadmap to counter the specific challenges raised during fiscal year 2018 ”
Christopher GuérinNexans' Chief Executive Officer
Download the full 2018 Third Quarter Information press release in PDF including consolidated sales by segment on the right:
A conference call has been organized on November 9. You can listen to a replay of the conference (available in the afternoon) by dailing the following numbers
- In France: +33 (0)800 94 41 12
- In the United Kingdom: +44 (0)2071 369 233
- In the United States: +1 617 213 4164
To listen to the conference, please enter 76259678
You can also download the MP3 recording of this call on the right
Audio recording of the conference call Q3 09112018Download
 The third quarter 2018 sales figure used for like-for-like comparisons corresponds to sales at constant non-ferrous metal prices adjusted for the effects of exchange rates and changes in the scope of consolidation. Exchange rates had a -37 million euro impact on sales at constant nonferrous metal prices during the period and there was no impact from changes in the scope of consolidation.
 Organic growth is defined as the difference between (i) standard sales for the current period of the current year (year Y) calculated at constant nonferrous metal prices, and (ii) standard sales for the same period of the previous year (year Y-1), calculated at constant non-ferrous metal prices and applying the exchange rates prevailing in year Y and based on the year Y scope of consolidation.
 Consolidated EBITDA is defined as operating margin before depreciation and amortization.
 To neutralize the effect of fluctuations in non-ferrous metal prices and therefore measure the underlying sales trend, Nexans also calculates its sales using constant prices for copper and aluminum.