Nexans 2014 Third-Quarter Financial Information

Today, Nexans announced that its sales for the third quarter of 2014 amounted to 1,574 million euros at current non-ferrous metal prices, or 1,130 million euros at constant1 non-ferrous metal prices, down 2.1%2 on an organic basis versus third-quarter 2013.

Business slowed compared with the first six months of the year due to the following factors: (i) the impact, as expected, of delivery schedules in the submarine high-voltage business, (ii) lower demand from utilities companies, (iii) weak sales of copper wires, and, to a lesser extent, (iv) an unfavorable basis of comparison for the Industry division. South America suffered declining demand in the building and energy distribution sectors, and Australia saw a further erosion of business – notably for Utilities – which weighed on performance in the Asia-Pacific region as a whole after sales had stabilized during the first half of 2014.

Overall, sales slowed considerably in July and August, but September saw a return to growth compared with the same month of 2013.

The third quarter of 2014 saw a number of commercial wins, including:

    the renewal of the framework agreement with the energy operator, Dong, for offshore array cables in the North Sea;
    the signature of two contracts for developing energy and rail infrastructure in Brazil;
    a contract to supply fiber optic cables for a new refinery in Qatar;
    the implementation of a new framework agreement with Swiss railway operator SBB for upgrading cabling infrastructure across its network.

During the period we also continued to implement our strategic initiatives at a sustained pace. Our capacity reduction measures in Europe and Australia are advancing in line with the announced schedule.

Overall, the Group is standing by the guidance it issued on October 1st, 2014, namely for full-year 2014 operating margin to come in at a similar level to 2013 (i.e., around 140 million euros), with sales volumes remaining stable year on year.

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