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• Revenue Growth: Standard sales grew 8.7% with an organic growth of 5.1% for 2024.

• EBITDA: EUR804 million, representing a 21% increase, with an adjusted EBITDA margin of 11.4%.

• Free Cash Flow: Record high normalized free cash flow of EUR454 million and free cash flow of EUR330 million.

• Order Backlog: EUR7.4 billion adjusted backlog in power transmission, providing visibility until 2028.

• Electrification Revenue: Electrification accounts for more than 74% of the group, with an adjusted EBITDA margin of 13%.

• Cash on Balance Sheet: EUR1.3 billion at the end of 2024.

• Leverage Ratio: Increased to 0.85 times due to acquisitions.

• Dividend Increase: Proposed increase of 13% to EUR2.6 per share.

• Return on Capital Employed: Improved to 21%, with electrification return at 26%.

• Power Transmission Growth: 50% organic growth year-on-year, with a 72% improvement in adjusted EBITDA.

• Warning! GuruFocus has detected 3 Warning Sign with NEXNY.

Release Date: February 19, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Nexans (NEXNY) achieved a record EBITDA of EUR 804 million in 2024, marking a 74% increase since 2021.

• The company reported a significant order intake of over EUR 8.2 billion, reflecting strong market demand.

• Electrification now accounts for more than 74% of Nexans (NEXNY)'s portfolio, with an adjusted EBITDA margin of 13%.

• Nexans (NEXNY) successfully integrated three companies, boosting electrification revenue by EUR 1.3 billion.

• The company reduced its carbon footprint by 29%, achieving a significant sustainability milestone.

Negative Points

• The leverage ratio increased slightly due to the acquisition of La Triveneta Cavi, impacting the balance sheet.

• Non-electrification sectors showed a decline of 2.5% in 2024, mainly due to a 27% drop in the automation business.

• The company faces uncertainties with the GSI project, which could impact EBITDA if not resolved.

• There was a higher income tax expense due to increased profits and origination in higher tax rate countries.

• The auto-harness business experienced a decline in sales, contributing to the overall decrease in non-electrification revenue.

Q & A Highlights

Q: Can you explain the key drivers behind Nexans' strong free cash flow in 2024 and any timing impacts on the 2025 cash flow? A: Jean-Christophe Juillard, Deputy CEO and CFO, explained that the shift from normalized to full free cash flow conversion resulted in a 34% cash conversion from EBITDA for 2025. The 2024 free cash flow was 39%, aided by significant working capital improvements due to increased backlog in transmission. For 2025, substantial CapEx investments are planned, including EUR100 million for a new vessel and other strategic projects, yet the cash conversion remains strong.