With 'outstanding' financial results in 2023, Prysmian upgrades its decarbonization strategy

With ‘outstanding’ financial results in 2023, Prysmian increases its decarbonization ambition

Italian cabling giant Prysmian in 2023 delivered what it says was a “remarkable performance” with “outstanding” financial results, record backlog in Transmission, as well as increased 2030 emission reduction ambition.

For the financial year 2023, Prysmian’s adjusted EBITDA rose by 9.4% to €1,628 million, with improving margins at 10.6% compared to 9.3% in 2022 – a year that Prysmian claimed was its best year ever in terms of financial results.

The Projects Business saw adjusted EBITDA up 23.5% at €300 million, while the Energy Business margins improved to 10.5% from 8.1% in 2022, said to be driven by higher profitability in power distribution and in particular in Industrial & Network Components, where adjusted EBITDA rose to €361 million, a 43.2% increase compared to 2022.

Net profit increased by 7.5% to €547 million, compared to €509 in 2022, and net profit attributable to owners of the parent company amounted to €529 million, compared to €504 million in 2022.

Group Sales amounted to €15,354 million, with a slightly negative organic growth of -1.1% compared to 2022. The Projects Business reported a double-digit organic growth (+15.3%) thanks to consistent execution of interconnection and offshore wind farm projects and projects with better margins, Prysmian said, adding that sales in the Energy Business continue to benefit from the growth drivers of the energy transition, including the expansion and upgrade of power grids, energy generation from renewable sources, and development of electric mobility and clouding.

In the Projects segment, consistent execution and improved projects’ margin are said to have driven solid results growth, with sales amounting to €2,508 million, with a strong +15.3% organic growth, and adjusted EBITDA leaping to €300 million, a 23.5% increase from 2022.

Sales in Energy & Infrastructure totaled €7,620 million with a -2.7% organic growth compared to 2022, and adjusted EBITDA increased by 14.6% to €843 million. Sales of Industrial & Network Components amounted to €3,358 million with a positive organic growth of 1.7% compared to 2022.

Renewables continued to grow double-digit year-on-year. Adjusted EBITDA grew by 43.2% to €361 million, compared to €252 million in 2022. According to Prysmian, profitability improved overall across all applications, in particular in OEM and Renewables.

“In a challenging environment, we achieved once again an excellent performance and ensured value creation to all our stakeholders. 2023 was my last year as CEO of Prysmian, and I am incredibly proud of the company we have built over the past 20 years, a strong organisation that is leading the industry, and that has the technology and resources to capitalize on exciting market opportunities and breaking new records year after year,” said Valerio Battista, Prysmian’s CEO.

In terms of projects, Prysmian completed the first utility-scale offshore wind farm in the U.S., Vineyard Wind 1, and the Viking Link HVDC interconnector linking the power grids of the UK and Denmark.

In 2023, the company acquired over €13 billion of new projects, bringing the total order book to approximately €20 billion. This February, the Italian cabling giant received the notice to proceed for the Amprion Frame Agreement and Eastern Green Link 2 (EGL2), projects awarded in 2023, bringing the total backlog up to approximately €18 billion.

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In 2023, GHG emissions (Scope 1 and Scope 2, market-based) amounted to 616 ktCO2eq, down 33% compared to the 2019 baseline, while Scope 3 GHG emissions were down 10% in the same period. In line with the net-zero trajectory approved by the Science Based Target initiative (SBTi), Prysmian has upgraded its decarbonization strategy, accelerating the transition plan, and foresees a Scope 1 and 2 GHG emissions reduction in the range of 55- 60% by 2030, going beyond the 47% target approved by SBTi.

For the financial year 2024, Prysmian expects to achieve an adjusted EBITDA in the range of €1,575-1,675 million, free cash flow in the range of €675-775 million, as well as scope 1&2 GHG emission reduction of 36% and Scope 3 reduction of 13% versus 2019.

“At our Capital Markets Day we laid out our “Connect, to Lead” strategy aimed at capitalizing on the Group’s leading market position to seize the opportunities presented by current market trends. We have reshaped our business into four new segments, effective from 1st January 2024 to better capture these opportunities,” said Massimo Battaini, CEO-designate at Prysmian.

“In light of our solid backlog across all segments, we are confident of achieving 2024 targets and are well on track to deliver the mid-term targets outlined at the Capital Markets Day, I look forward to driving this company and our great team to the next level and to strengthening our role as global cabling solution provider leading the Energy Transition and Digital Transformation.”