Prysmian — Earnings Release 2015

Feb 24, 2016

FY 2015 Financial Results

Milan – February 24th, 2016

Agenda

FY 2015 Highlights

• o Group overview
• o Results by business
• o Focus on OCI Acquisition
• Financial results
• Appendix

FY 2015 Highlights

• FY2015 Organic Growth ex. WL impact at +5.9% (+3.2% in Q4).
• Sound execution in Energy Projects (+18.2% organic growth ex WL)
• Solid market fundamentals in Telecom (+9.9% organic growth).

Adj. EBITDA at € 623m: guidance achieved in line with expectations. Strong contribution from Energy Projects and Telecom.

Net Financial Position at € 750m (€ 529m excl. acquisitions), much better than expected.

• "Bolt-on acquisition" of Oman Cables Industry:
• Increase geographic diversification of the group toward middle-east.
• Well known company with a solid track record.

1) Free Cash Flow levered excluding acquisitions, dividends paid and other equity movements

FY 2015 Key Financials

Euro Millions, % on Sales

* Org. Growth

150* 392 423 383 Dec-13 Dec-14 Dec-15 5.6% 6.2% 2.0%* * Excl. OCI and GCDT

(1) Adjusted excluding non-recurring income/expenses; (2) Defined as NWC excluding derivatives;

Continued organic growth and profitability improvement

Profitability increase driven by Energy Projects, Telecom & E&I

Production capacity rationalization in progress.

12 plants closed to date, 3 closure ongoing: improve saturation in Europe

FY 2015 Highlights

• o Group overview
• o Results by business
• o Focus on OCI Acquisition
• Financial results
• Appendix

Energy Projects

Euro Millions, % on Sales

* Org. Growth 2013 2014 2015 2013 2014 2015

Highlights

Submarine

• Markets remains mainly concentrated in Europe, with an increasing tendering activity for new off-shore wind projects in France and UK.
• Order book remains close to peak levels, with an order intake above €1bn in 2015.
• The new COBRA Cable project awarded in Jan-16 confirms solid market prospective.

Underground High Voltage

• Business was broadly stable vs. 2014: stability in Europe, North America and China, positive trend in the Middle East.

SURF

• Positive trend in Umbilical business thanks to the framework contract with Petrobras in place since 2013.
• Stabilization of DHT thanks to a broad customer base and geographical presence.
• Acquisition of GCDT expands presence in DHT business and complement the product range.

Leadership in submarine reconfirmed in 2015.

Record visibility in Submarine

Energy & Infrastructure

Euro Millions, % on Sales

* Org. Growth

Adj. EBITDA / % on Sales

Highlights

Trade & Installers

• Flat organic sales growth. Stable pricing environment.
• Positive trend in Europe (especially in Spain, UK and the Nordics) and North America.
• Weak demand in Brazil affected by negative macro evolution.

Power Distribution

• Solid growth driven by volume recovery in the Nordics and strong demand in Germany, North America and Argentina.

* Vs. previous year period

Industrial & Network Components

Euro Millions, % on Sales

* Org. Growth

Adj. EBITDA / % on Sales

Specialties & OEMs

• Moderate growth recorded in 2015.
• Positive performance in N. America and Europe, mainly driven by Nuclear, Crane and Railway.
• Marine and Mining segments suffering from low commodity prices and difficult macro scenario.

Oil & Gas

• Very tough market conditions with sharp decline in Projects, MRO and drilling businesses.

Elevator

• Positive organic growth in all geographies, with significant progresses in APAC and EMEA regions.

Automotive

• Strong competition on standard products deeply affected the performance of the business in H1 with a partial recovery in H2.

Network Components

• Positive performance in China and North America partially offset by weak demand of HV accessories in Europe.

Telecom Euro Millions, % on Sales

* Org. Growth

Adj. EBITDA / % on Sales

Highlights Optical, Connectivity & Fiber

• Solid demand in EU, US and Australia, while Brazil is still suffering from a difficult macro environment.

• Prices broadly stable vs. 2014. Margin improving thanks to scale effect, industrial footprint optimization and fibre cost reduction.

MMS

• High single-digit organic growth Positive trend in Europe, supported by the growth of datacenters.

Quarter organic growth* and LTM Adj. Ebitda evolution

FY 2015 Highlights

• o Group overview
• o Results by business
• o Focus on OCI Acquisition
• Financial results
• Appendix

Focus on Oman Cables Industry Acquisition

A perfect example of "Bolt-on" acquisition.

2015 Sales Breakdown (€ million Structure of the Deal (1))

(1) 2015 average EUROMR spot FX rate 0.4268

Strategic Position

STRUCTURE OF THE DEAL

• Acquisition of approx. 16% stake in listed company OCI
• Total cash consideration € 105 million
• OCI Balance Sheet consolidated at 31 Dec 2015; P&L consolidated as of 1st Jan 2016.

STRATEGIC RATIONALE

• Geographic diversification toward middle-east region.
• No import duties in GCC market.
• Low integration risk. Solid track record.

Product Range

• Building Wire and Cable
• LV and MV power cables (up to 33kV)
• Control cables for industrial applications

FY 2015 Highlights

• o Group overview
• o Results by business
• o Focus on OCI Acquisition
• Financial results
• Appendix

	FY 2015	FY 2014	WL effect FY'15 vs. FY'14
Sales	7,361	6,840	(44)
YoY total growth	7.6%	(2.2%)
YoY organic growth	5.3%	1.8%	(26) in FY'15
YoY organic growth excl. WL	5.9%	2.7%	(94) in FY'14
Adj.EBITDA	623	509	6 8
% on sales	8.5%	7.4%
Adj.EBITDA excl. WL	649	603	-
% on sales	8.7%	8.7%
Non recurring items	(1)	(13)	-
EBITDA	622	496	6 8
% on sales	8.4%	7.2%
Adj.EBIT	473	365	6 8
% on sales	6.4%	5.3%
Non recurring items	(1)	(13)	-
Special items	(73)	(40)	-
EBIT	399	312	6 8
% on sales	5.4%	4.5%
Financial charges	(89)	(140)
EBT	310	172	6 8
% on sales	4.2%	2.5%	(18) in FY'15
Taxes	(96)	(57)	(20) (66) in FY'14
% on EBT	31.0%	33.0%
Net income	214	115	4 8
% on sales	2.9%	1.7%
Net income excl. WL	232	181
% on sales	3.2%	2.6%

Non Recurring and Special Items on EBIT

	FY 2015	FY 2014
Antitrust investigation Restructuring Price adjustments Other	2 9 (53) - 2 3	3 1 (48) 2 2 (18)
EBITDA adjustments	(1)	(13)
Special items Gain/(loss) on metal derivatives Assets impairment Other	(73) (27) (21) (25)	(40) 7 (44) (3)
EBIT adjustments	(74)	(53)

	FY 2015	FY 2014
Net interest expenses	(73)	(87)
of which non cash Conv.Bond interest exp.	(8)	(8)
Bank fees amortization	(4)	(7)
Gain/(loss) on exchange rates	(31)	(20)
Gain/(loss) on derivatives 1 )	1 2	(16)
Non recurring effects	7	(10)
Net financial charges	(89)	(140)

1) Includes currency and interest rate derivatives

Statement of financial position (Balance Sheet)

	31 Dec 2015	New Perimeter Acquired	31 Dec 2014
Net fixed assets	2,480	280	2,219
of which: goodwill	539	157	380
of which: other intangible assets	183	28	181
of which: property, plants & equipment	1,551	95	1,414
Net working capital	342	230	407
of which: derivatives assets/(liabilities)	(41)	(3)	(16)
of which: Operative Net working capital	383	233	423
Provisions & deferred taxes	(307)	(26)	(281)
Net Capital Employed	2,515	483	2,345
Employee provisions	341	4	360
Shareholders' equity	1,424		1,183
of which: attributable to minority interest	146	115	3 3
Net financial position	750	7 8	802
Total Financing and Equity	2,515	197	2,345

	FY 2015	FY 2014
Adj.EBITDA	623	509
Non recurring items	(1)	(13)
EBITDA	622	496	∆ NFP 2010PF -2015
Net Change in provisions & others	(75)	(53)
Share of income from investments in op.activities	(39)	(43)	NFP Pro-forma 2010*	(1,214)
Cash flow from operations (before WC changes)	508	400	NFP 2015	(750)
Working Capital changes	243	(1)	∆ NFP	464
Dividends received	17	36
Paid Income Taxes	(71)	(72)
Cash flow from operations	697	363	Of which:	Cumulated 2011-15
Acquisitions	(138)	9	FCF lev. excl. acquisitions	1171
Net Operative CAPEX	(200)	(155)	Dividends & Buyback	(374)
Free Cash Flow (unlevered)	359	217	Acquisitions	(215)
Financial charges	(100)	(110)
Free Cash Flow (levered)	259	107	NFP acquired from M&A	(83)
Free Cash Flow (levered) excl. acquisitions	397	98	Other non-cash movements** (35)
Dividends	(91)	(90)	∆ NFP	464
Other equity movements & treasury shares buy-back	3	(20)
Net Cash Flow	171	(3)
NFP beginning of the period	(802)	(805)
Net cash flow	171	(3)
Other variations (including OCI gross debt)	(119)	6
NFP end of the period	(750)	(802)

* Includes debt originated by Transaction costs (€ 19m) and Refinancing costs (€ 7m) related to Draka acquisition in 2011

** Includes Other Equity movements and Other variations

Dividend proposal

(1) Outstanding as of February 23, 2016

(2) Shares with dividend right: Total shares outstanding (216,720,922) – Treasury shares owned by the Company (2,707,176)

(3) Based on 2015 average price (€ 19.1)

FY 2015 Highlights

• o Group overview
• o Results by business
• o Focus on OCI Acquisition
• Financial results

Appendix

Prysmian group at a glance

FY 2015 Financial Results

EMEA 63% North America 16% Latin America 8% APAC 13% € 7,361m

Adj. EBITDA by business Adj. EBITDA margin

Sales breakdown by geography

1) Excluding WL submarine project effect

Energy Projects

Sales breakdown

Energy & Infrastructure

Sales breakdown

Industrial & Network Components

Sales breakdown

Telecom Sales breakdown

Bridge Consolidated Sales

Profit and Loss Statement

	FY 2015 excl. WL submarine project effect	FY 2015 WL submarine project effect	FY 2015	FY 2014 excl. WL submarine project effect	FY 2014 WL submarine project effect	FY 2014
Sales YoY total growth	7,466 8.2%	(105)	7,361 7.6%	6,901 (1.3%)	(61)	6,840 (2.2%)
YoY organic growth	5.9%		5.3%	2.7%		1.8%
Adj.EBITDA % on sales	649 8.7%	(26)	623 8.5%	603 8.7%	(94)	509 7.4%
Non recurring items	(1)	-	(1)	(13)	-	(13)
EBITDA % on sales	648 8.7%	(26)	622 8.4%	590 8.5%	(94)	496 7.2%
Adj.EBIT % on sales	499 6.7%	(26)	473 6.4%	459 6.7%	(94)	365 5.3%
Non recurring items Special items	(1) (73)	- -	(1) (73)	(13) (40)	- -	(13) (40)
EBIT % on sales	425 5.7%	(26)	399 5.4%	406 5.9%	(94)	312 4.5%
Financial charges	(89)	-	(89)	(140)	-	(140)
EBT % on sales	336 4.5%	(26)	310 4.2%	266 3.9%	(94)	172 2.5%
Taxes % on EBT	(104) 30.9%	8	(96) 31.0%	(85) 32.0%	2 8	(57) 33.0%
Net income % on sales	232 3.1%	(18)	214 2.9%	181 2.6%	(66)	115 1.7%

Energy Projects Segment – Profit and Loss Statement

	FY 2015 excl. WL effect	FY 2015 WL effect	FY 2015	FY 2014 excl. WL effect	FY 2014 WL effect	FY 2014
Sales to Third Parties YoY total growth YoY organic growth	1,692 19.5% 18.2%	(105)	1,587 17.1% 15.8%	1,416 4.2% 6.1%	(61)	1,355 (0.3%) 1.7%
Adj. EBITDA % on sales	272 16.1%	(26)	246 15.5%	248 17.5%	(94)	154 11.3%
Adj. EBIT % on sales	228 13.5%	(26)	202 12.7%	208 14.7%	(94)	114 8.4%

Energy Products Segment – Profit and Loss Statement

		FY 2015	FY 2014
	E&I	2,795	2,677
	YoY total growth	4.4%	(2.6%)
s e	YoY organic growth	3.0%	2.7%
rti a	Industrial & Netw. Comp.	1,749	1,708
P d	YoY total growth	2.4%	(4.4%)
r hi	YoY organic growth	(2.3%)	(0.3%)
T	Other	121	106
o s t	YoY total growth	14.1%	(7.6%)
e	YoY organic growth	11.8%	(4.8%)
al S	ENERGY PRODUCTS	4,665	4,491
	YoY total growth	3.9%	(3.4%)
	YoY organic growth	1.2%	1.4%
	E&I	128	108
A	% on sales	4.6%	4.1%
D T	Industrial & Netw. Comp.	113	126
BI E	% on sales	6.5%	7.4%
dj.	Other	2	5
A	% on sales	1.9%	4.6%
	ENERGY PRODUCTS	243	239
	% on sales	5.2%	5.3%
	E&I	93	74
	% on sales	3.3%	2.8%
T BI	Industrial & Netw. Comp.	88	100
E	% on sales	5.0%	5.9%
dj.	Other	0	3
A	% on sales	0.3%	3.2%
	ENERGY PRODUCTS	181	177
	% on sales	3.9%	3.9%

Telecom Segment – Profit and Loss Statement

	FY 2015	FY 2014
Sales to Third Parties	1,109	994
YoY total growth	11.6%	0.8%
YoY organic growth	9.9%	4.0%
Adj. EBITDA	134	116
% on sales	12.1%	11.7%
Adj. EBIT	90	74
% on sales	8.1%	7.4%

Western Link effect: new financial impact

Euro 35 Millions project's result improvement

Reference Scenario

Commodities & Forex

25 50 75 100 125 150 J-08 J-09 J-10 J-11 J-12 J-13 J-14 J-15 J-16 Brent \$/bbl Brent €/bbl

Based on monthly average data Source: Nasdaq OMX

Disclaimer

• The managers responsible for preparing the company's financial reports, A.Bott and C.Soprano, declare, pursuant to paragraph 2 of Article 154-bis of the Consolidated Financial Act, that the accounting information contained in this presentation corresponds to the results documented in the books, accounting and other records of the company.
• Certain information included in this document is forward looking and is subject to important risks and uncertainties that could cause actual results to differ materially. The Company's businesses include its Energy Projects, Energy Products and Telecom Operating Segments, and its outlook is predominantly based on its interpretation of what it considers to be the key economic factors affecting these businesses.
• Any estimates or forward-looking statements contained in this document are referred to the current date and, therefore, any of the assumptions underlying this document or any of the circumstances or data mentioned in this document may change. Prysmian S.p.A. expressly disclaims and does not assume any liability in connection with any inaccuracies in any of these estimates or forward-looking statements or in connection with any use by any third party of such estimates or forward-looking statements. This document does not represent investment advice or a recommendation for the purchase or sale of financial products and/or of any kind of financial services. Finally, this document does not represent an investment solicitation in Italy, pursuant to Section 1, letter (t) of Legislative Decree no. 58 of February 24, 1998, or in any other country or state.
• In addition to the standard financial reporting formats and indicators required under IFRS, this document contains a number of reclassified tables and alternative performance indicators. The purpose is to help users better evaluate the Group's economic and financial performance. However, these tables and indicators should not be treated as a substitute for the standard ones required by IFRS.