Nexans takes impairment charge for poor economic environment

French cable maker Nexans announced January 22 that it is taking an impairment charge of €197 million ($228 million) against its accounts to reflect the deteriorating macroeconomic and financial environment in 2014.



The company said that this particularly applied to 2H 2014 at some of its cash generating units and reflects the impact of a significant fall in oil and raw materials prices as well as political developments in some countries.

The €197 million ($228 million) impairment charge is made up as follows:

    Nexans AmerCable: €80 million ($92.5 million)
    Australia: €66 million ($76.4 million)
    Brazil: €40 million ($46.2 million)
    Russia: €11 million ($12.7 million)


The company said that this adjustment in asset values will have a negative impact of the same magnitude on its net income in 2014. It will be neutral on the group's cash position as well as on its operating margin. Nexans will announce its 2014 results on February 13, 2015.

Nexans said that financial analysts' consensus as of January 21, 2015 for its operating margin for the years 2014 and 2015 is "reasonable".  The operating profit forecast by analysts and published on Nexans' website range from €131-144 million ($152 - 167 million) for 2014 and €180-215 million ($208-249 million) for 2015.

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